724500R38HLH2G58KQ512021-01-012021-12-31724500R38HLH2G58KQ512021-12-31iso4217:UAH724500R38HLH2G58KQ512020-12-31724500R38HLH2G58KQ512019-12-31iso4217:EUR724500R38HLH2G58KQ512020-01-012020-12-31xbrli:sharesiso4217:EURxbrli:sharesiso4217:UAHxbrli:shares724500R38HLH2G58KQ512019-12-31ifrs-full:IssuedCapitalMember724500R38HLH2G58KQ512019-12-31ifrs-full:AdditionalPaidinCapitalMember724500R38HLH2G58KQ512019-12-31ifrs-full:RetainedEarningsMember724500R38HLH2G58KQ512019-12-31ifrs-full:RevaluationSurplusMember724500R38HLH2G58KQ512019-12-31ifrs-full:TreasurySharesMember724500R38HLH2G58KQ512019-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:IssuedCapitalMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:AdditionalPaidinCapitalMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:RetainedEarningsMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:RevaluationSurplusMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:TreasurySharesMember724500R38HLH2G58KQ512020-01-012020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember724500R38HLH2G58KQ512020-12-31ifrs-full:IssuedCapitalMember724500R38HLH2G58KQ512020-12-31ifrs-full:AdditionalPaidinCapitalMember724500R38HLH2G58KQ512020-12-31ifrs-full:RetainedEarningsMember724500R38HLH2G58KQ512020-12-31ifrs-full:RevaluationSurplusMember724500R38HLH2G58KQ512020-12-31ifrs-full:TreasurySharesMember724500R38HLH2G58KQ512020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:IssuedCapitalMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:AdditionalPaidinCapitalMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:RetainedEarningsMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:RevaluationSurplusMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:TreasurySharesMember724500R38HLH2G58KQ512021-01-012021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember724500R38HLH2G58KQ512021-12-31ifrs-full:IssuedCapitalMember724500R38HLH2G58KQ512021-12-31ifrs-full:AdditionalPaidinCapitalMember724500R38HLH2G58KQ512021-12-31ifrs-full:RetainedEarningsMember724500R38HLH2G58KQ512021-12-31ifrs-full:RevaluationSurplusMember724500R38HLH2G58KQ512021-12-31ifrs-full:TreasurySharesMember724500R38HLH2G58KQ512021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember
ANNUAL
REPORT
2021
3
ASTARTA ANNUAL REPORT 2021
CONTENTS
COMPANY AT A GLANCE
OVERVIEW
Letter to Shareholders ........................................................ 4
Astarta’s History .................................................................. 5
Business Model ................................................................... 6
Value Creation ...................................................................... 8
Key Operational Results ...................................................... 10
Key Financial Results .......................................................... 11
Selected Financial Data ...................................................... 12
REPORT ON OPERATIONS
Agriculture ............................................................................ 16
Sugar Production ................................................................. 19
Soybean Processing ............................................................ 22
Cattle Farming...................................................................... 24
Shareholders and Share Price Performance .................... 26
Risk Management ............................................................... 27
Outlook ................................................................................. 31
SUSTAINABILITY
Energy ................................................................................... 35
Waste .................................................................................... 36
Emissions and Acting on Climate Change ......................... 38
Water Withdrawal and Discharge ....................................... 41
Animal Welfare ..................................................................... 43
Land Use and Biodiversity .................................................. 44
Human Capital ..................................................................... 45
Occupational Health and Safety......................................... 48
Training ................................................................................. 49
Diversity and Equal Opportunities ..................................... 51
Freedom of Association and Collective Bargaining .......... 52
Human Rights ...................................................................... 52
Certification and Sustainable Products and Services ...... 53
Local Communities .............................................................. 54
Managing COVID-19 Related Risks .................................... 56
Business Ethics.................................................................... 57
Anti-corruption ..................................................................... 58
Task Force on Climate-related Financial Disclosures ....... 58
EU Taxonomy Disclosure ..................................................... 61
CORPORATE GOVERNANCE REPORT
FINANCIAL STATEMENTS
Consolidated financial statements .................................... 94
Company financial statements ........................................... 177
INDEPENDENT AUDITOR’S REPORT
Ukraine’s agricultural
businesses by land bank
market share in domestic
sugar production
soybean
processors in Ukraine
country’s industrial
milk producer
One of the Top-5
One of the largest
22%
№1
562kt
Total storage
capacity of
290kt
Domestic
sugar sales
50
countries
Exports to
45%
Export share
(by volume)
41%
EBITDA
margin
4,820
employees
36%
of total workforce
are women
EUR0.5
Dividends for 2020
EUR231m
Market capitalization
(as of 31/12/2021)
Hereinafter differences between totals and sums
of the parts are possible due to rounding.
For the purposes of the Dutch Civil Code the Director’s report constitutes the following sections of this document:
the Overview, Report on Operations, Sustainability, Corporate Governance report (excluding Remuneration report).
per share
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
4 5
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Dear colleagues and friends,
2022 started traditionally with the analysis of Astarta’s
annual results and us preparing to proudly present them to
our stakeholders. By mid-February large part of this report
was prepared with optimism and confidence in the future as
the strong results of 2021 give us confidence for ambitious
development plans.
Little did we know about an imminent danger of a full-scale
invasion from Russia that brought immeasurable pain and
distress to all Ukrainians. One can read the details of Astarta’s
operating and financial results for 2021 in this Annual Report
but let us briefly describe the state of current affairs.
Since the February 24, 2022, Ukraine faces in a new reality
in which core human rights such as to life and safety are at
risk. Thus, starting from this day the key goals of the Company
are the health and safety of its employees and their families,
as well as continuity of its operations under the warfare
conditions.
Astarta’s top management stayed in Ukraine to support
employees and mobilize all efforts to sturdy the asset base
and production processes. As Astarta is one of the top
domestic food producers it plays a crucial role in securing
the food safety for Ukraine. Astarta’s team works 24/7 on
providing humanitarian aid, running its business operations
and maintaining food security.
The management believes that Astarta has to contribute to
the provision of food for civilians and army, provide necessary
assistance and shelter to those who lost home and had to
move to other regions of Ukraine. The Company also joined
the World Food Programme by offering inhouse logistic
capability for delivery of humanitarian aid across the country.
The management and all employees bear the responsibility
to plant, grow, harvest and deliver key agricultural crops to
domestic and overseas customers.. Ukraine is able to grow
and supply food products to the international market even
under current extreme conditions. That’s why Astarta and its
industry peers continue to deliver on its key mission.
At the time of this report Astarta’s assets in the key regions
of our presence are intact despite heavy military infighting in
several Ukrainian regions. Each day the Company’s employees
go into the fields to perform routine work except for 4kha of
farmland located in the Chernihiv region. Astarta has secured
key inputs for the spring planting and is in the process of
obtaining supplies in preparation for the harvesting and
processing of crops.
Without any doubt this year’s agricultural season will be the
most difficult one in Astarta’s business history and in Ukraine.
At the same time the Company’s operations are supported by
its professional and brave employees, its financial partners,
suppliers, customers and other stakeholders. There is the
strongest foundation ever to overcome any challenges and
contribute to the victory of Ukraine and its people..
Sincerely,
Viktor Ivanchyk
Founder and CEO
LETTER
TO SHAREHOLDERS
Astarta is one of the largest vertically-integrated agroindustrial
holdings in Ukraine. The Company’s main activities include
grain and oilseeds production, sugar production from sugar
beets and raw cane sugar processing, soybean crushing,
milk production, as well as grain and oilseeds storage and
handling services.
Since 1993, the Company has proven to be a reliable
and trustworthy partner and supplier, committed to best
international standards in terms of quality, innovation, and
sustainability. Integrity, transparency, and strengths of its
human capital has also been among Astarta’s key priorities.
The Company maintains a nation-wide presence with around
5k employees based at its production and storage facilities
in seven regions. Their dedication and expertise determine
Astarta’s success.
The Company has established stable long-term business
relationships with leaders of the Ukrainian food processing,
confectionary and retail industries. The Company exports its
produce to 50 countries.
Astarta’s achievements have been built on continued
development and innovation to meet changing needs of
its customers, to improve operations and to work with
independent crop growers via the Partnership Centre to
ensure sustainable agricultural production.
Through an effective leadership effort from everyone across
the Company, combined with the right resources and trust
in regional teams, Astarta delivered revenues and operating
profit at levels way above previous years.
ASTARTA’S
HISTORY
1993
Foundation
of the Company
1999
Acquisition of
the first sugar plant
1997
Start of the agricultural
business
2003-2013
Expansion of
the sugar business
2006
Astarta’s shares listed
on the Warsaw Stock Exchange
2014
Launch of the soybean
processing plant
2007
Active farmland
expansion
2020
Partnership Centre
for co-operation
with independent farmers
2015-2019
Building the grain
and oilseeds silo
network
2021
Debut dividends
payment for 2020
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
6 7
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Raw cane sugar: 75kt
BUSINESS MODEL
Sugar beets: 1 844 kt
Organic produce: 4kt
Corn: 507kt
Wheat: 268kt
Sunseeds: 76kt
Rapeseeds: 23kt
Soybeans: 94kt
Sugar beets: 1 584kt
Sugar: 340kt
Sugar by–products: 85kt
Corn: 483kt
Wheat: 290kt
Sunseeds: 45kt
Rapeseeds: 28kt
Sugar: 290kt
Sugar by–products: 70kt
Sugarbeet pulp
Gas
Gas
Production
Production
Processing
Soybean: 172ktProcessing
Sales
Sales
Soybean oil: 32kt
Soybean meal: 128kt
Soybean husk: 9kt
Soybean oil: 31kt
Soybean meal: 123kt
Soybean husk: 8kt
Production Sales
22k heads
Milk: 97kt Milk: 94kt
Headcount
Production Sales
Network of 7 grain and
oilseeds silos with storage
capacity of up to 562kt
Land bank
c. 220kha
Agriculture
Cattle farming
Sugar production
Soybean processign
Bioenergy plant with capacity
up to 75k m
3
equivalent of
natural gas per day
Astarta aims at maximising value for all stakeholders through organic growth of its core business segments. At the same time,
long-term value creation is viewed by Astarta through the prism of sustainability of its business model with the particular attention
to the environmental and social aspects.
AGRICULTURE
• c. 220kha under management. Key crops:
corn, wheat, sunseeds, sugar beet, soybeans,
rapeseeds.
• In-house storage & handling facilities with
capacity of 562kt.
• Modern agriculture machinery fleet.
• A proprietary integrated multi-module IT
solution for agribusiness management.
SUGAR PRODUCTION
• Certified producer of high-quality sugar
• Six sugar production plants.
• Biggest sugar producer in Ukraine with 22%
market share.
• Self-sufficient in raw materials with 80% of
sugar beet grown in-house.
• Partnerships with local farmers to secure
sugar beets supply.
Innovations is the important element of Astarta’s business
model as they can provide for better operational results
and enhance the sustainability aspect of its activities. The
Company has a proprietary integrated multi-module IT
software, called AgriChain, for agribusiness management. The
core of AgriChain is a WEB-portal, consisting of eight modules
aimed at streamlining business processes in the sphere of
farmland management, field operations, storage, purchase
and supply processes, crop monitoring, agrochemical soil
and meteorological data and plant vegetation status (NDVI).
In 2021 a new module of the software dedicated to crop
monitoring, called “AgriChain Scout”, was extended to cover
100% of the Company’s arable land area (vs 75% in 2020).
The system is aimed at improving harvest predictability
by integrating crop monitoring, agrochemical status,
meteorological data and plant vegetation status.
INNOVATIONS AND R&D
ENVIRONMENTAL ASPECT SOCIAL ASPECT
The aim of Astarta’s strategy is to contribute to environmental
objectives by using elements of carbon farming and similar
sustainable technologies.
Astarta has a huge potential in carbon sequestration
through organic or carbon farming which implies reduced
tillage, planting cover crops, among, others and building up
organic matter in the soil, thereby improving its health. This
way organic farming contributes to removal of CO
2
from the
atmosphere.
Such regenerative farming also contributes to the protection
and restoration of biodiversity as it implies reduced
mechanical treatment of the soil which is one of the reasons
for biodiversity decline. It also contributes to the transition
to a circular economy through the reduction of use raw
materials such as fertilizers.
Astarta strategy implies gradual switch to reduced tillage at
its farms.
Astarta also continuously works on the improvement of its
production assets and renewal of agricultural equipment
increase efficiency in use of natural resources, prevent or
minimise impact on environment.
Social aspect of Astarta’s business is hard to overestimate
as people is its most valuable resource.
The aim of our strategy is to build favourable environment
for sustainable development, cooperation and comfortable
life of people with whom we interact in the course of our
activities.
The key components of the strategy are human capital,
employees’ development, human rights, community
relations, occupational health and safety.
Realisation of the strategy is conducted through different
projects directed at the development of communities,
establishing of safe and comfortable working conditions,
promoting diversity etc (for more information refer to the
section Local Communities of this report). Thereby, Astarta
sets up a strong basis for future growth within sustainable
business model.
SOYBEAN PROCESSING
• One of the biggest soybean processors
in Ukraine with 13% share.
• 43% of inhouse high quality non-GMO
soybeans.
• Partnerships with local farmers to
secure soybeans supply.
CATTLE FARMING
• Biggest industrial dairy farmer
supplying premium quality milk in
Ukraine.
• 22k heads of cattle.
• 97kt of milk produced.
• Own feed centre and inputs.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
8 9
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
VALUE CREATION
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FOR PEOPLE
Astarta believes that people are the most vulnerable and valuable capital of its business. Thus,
the Company pays a lot of attention to the development of its employees, works hard towards
retention of talent and adheres to a collaborative approach in relations with the workforce.
To this end, Astarta not only meets the requirements of local legislation but also
implements in-house initiatives focusing on the needs of personnel. Among them
are medical insurance or wellness programmes, talent pool, a “Think Tank” for
employees’ ideas management, school of internal coaching, scholarship
programme etc.
By conducting its business Astarta creates jobs mainly in the rural area.
In 2021 the Company employed 4,820 people 92% of which were
employed in the rural area.
Beside comfortable working conditions Astarta offers competitive
wages. In 2021 average salary in Astarta was UAH20k per month,
or 44% higher compared to an average Ukrainian salary.
Total contribution of the Company in the form of salary, wages
and additional financial incentives was EUR57m in 2021.
FOR SHAREHOLDERS AND CREDITORS
Astarta proved to be a reliable and trusted financial partner
for top local and international financial institutions. During its
history Astarta built mutually beneficial relations with its financial
partners. In 2021 Astarta made EUR3m in loan interest payments.
One of the Company’s top priorities is increasing value for
the shareholders. Astarta strives to build strong relations with
shareholders through meeting their expectations. In 2021 it made
a debut dividend payment for 2020 of EUR12m or EUR0.5 per share.
FOR LOCAL COMMUNITIES AND ENVIRONMENT
Astarta is one of the largest land operators in Ukraine which conducts its business activity in
different regions of Ukraine. Its nature implies strong involvement of local communities which,
among others, include landowners who lease out land to the Company.
Astarta carries out dedicated programmes in the sphere of healthcare, education, culture, infrastructure etc. In
2021 the Company spent EUR0.9m on such projects. Astarta operates c. 220kha of land leased from almost 57k landowners-
physical individuals through lease agreements. Total amount of payments of interests on lease liabilities in 2021 was EUR21m.
As a big agroindustrial holding Astarta operates production assets and infrastructure which implies certain impact on the
environment. Astarta conducts its business in alignment with policies, requirements of local legislation, and the commitment to
international standards and best practices. the Company endeavours to minimise its negative impact and to maximize potential
benefits. With this purpose Astarta continuously conducts modernisation of its assets, introduces modern technologies, increases
operational efficiency. By way of an example, Astarta’s biogas facility uses renewable sources as a raw material for biogas
production and the application of modern agricultural technologies expand sustainability principals into its business model.
EUR2.4m spent on CSR and environmental programmes.
FOR SUPPLIERS AND CLIENTS
Astarta’s production assets and infrastructure in Ukraine create a value chain in agriculture
and food processing. The Company takes best efforts to improve its assets and products to
meet the highest requirements of clients. Assets are permanently assessed by external
audits to confirm high quality of the products produced. In 2021 Astarta sold 290kt
of sugar, 861kt of grains and oilseeds, 161kt of soybean products and 94kt of
milk resulting in EUR491m of total sales.
Considering its business scale the Company deals with significant number
of suppliers. In 2021 Astarta had 13k suppliers. Spending for products
and services received from the suppliers totalled EUR250m in
2021, with more than 80% derived from local suppliers.
FOR FARMERS
Astarta closely cooperates with local farmers on supply of sugar
beets to sugar plants as well as grains and oilseeds to silos.
The Company strives to establish strong relations with farmers
located in the regions of Astarta’s operations. With this purpose
the Company created a Centre for Partnerships with Independent
Farmers and developed dedicated programmes which include
finance and agricultural services as well as supply of various
farming inputs. In 2021 Astarta procured over 360kt of sugar beet
and 120kt of grains and oilseeds from local farmers.
FOR THE ECONOMY
By conducting its business Astarta directly and indirectly creates value for
the Ukrainian economy. One of the key direct contributions is taxes paid by the
Company. In 2021 Astarta paid a total of UAH1.6bn (EUR52m) in taxes and
duties in Ukraine including UAH614m (EUR20m) into the State budget of Ukraine
and UAH972m (EUR31m) in the local budgets of the regions of Astarta’s presence.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
10 11
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
KEY OPERATIONAL
RESULTS
KEY FINANCIAL
RESULTS
786
1065
1014
814
974
2017 2018
2019 2020 2021
463
110
153
158
169
152
128
32
40
44
40
39
106
96
93
97
352
302
226
340
2017 2018 2019
2020 2021
Soybean meal Soybean oil
2017 2018 2019 2020 2021
2017 2018 2019 2020 2021
REVENUES, EURmGRAIN AND OILSEEDS PRODUCTION, kt EBITDA, EURm*SUGAR PRODUCTION, kt
NET DEBT, EURm, NET DEBT TO EBITDA, x* SOYBEAN MEAL AND OIL PRODUCTION, kt NET PROFIT, EURmMILK PRODUCTION, kt
459
2017
2017
2017
2017
372
2018
2018
2018
2018
448
2019
2019
2019
2019
416
2020
2020
2020
2020
2021
2021
491
152130 324 276 129
120
122
2017
68
62
78
2018
113
2
(18)
2021
2021
201
9
0.8
1.1
4.8
3.5
1.1
Net Debt
* 2017 data is before IFRS16
Net Debt/EBITDA
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
12 13
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
SELECTED FINANCIAL DATA
SUMMARY P&L
EURk 2020 2021
Revenues*, including 415 630 491 355
Agriculture 175 137 185 049
Sugar production 126 973 170 197
Soybean processing 75 157 89 814
Cattle farming 33 167 38 474
Cost of sales, including (348 182) (415 958)
Effect of FV remeasurement of AP** (43 314) (87 747)
Changes in FV of BA and AP** 54 084 143 835
Gross profit 121 532 219 232
Gross profit margin 29% 45%
EBIT 56 278 150 073
Depreciation & Amortisation, including: 55 510 51 386
Charge of right-of-use assets 18 729 18 248
EBITDA***, including 113 421 201 459
Agriculture 80 190 153 966
Sugar production 21 522 35 671
Soybean processing 7 446 5 084
Cattle farming 8 748 8 804
EBITDA margin 27% 41%
Interest expense on lease liability (22 162) (20 814)
Finance costs and income (10 421) (3 922)
Forex gain/(loss) (17 134) 1 003
Net profit/(loss) 8 611 122 491
Net profit/(loss) margin 2% 25%
* Including grains and oilseeds trading operations in the amount of EUR47m in 2021 and EUR36m in 2020
** FV – Fair Value, BA – Biological Assets, AP – Agricultural Produce
*** EBITDA is calculated as the sum of the profit from operations plus amortization and depreciation
EURk 2020 2021
Gross Profit, ex BA & AP remeasurement 110 762 163 144
Gross Margin, ex BA & AP remeasurement 27% 33%
EBITDA, ex BA & AP remeasurement 102 651 145 371
EBITDA margin, ex BA & AP remeasurement 25% 30%
Astarta’s consolidated revenues amounted to EUR491m in 2021, up 18% y-o-y, on higher sales prices of grains, sugar and
soybean products. Revenues in the Agricultural segment increased by 6% to EUR185m, 38% of the total consolidated revenues.
Revenues in the Sugar Production segment increased by 34% y-o-y to EUR170m. The Soybean Processing and the Cattle Farming
segments generated EUR90m and EUR38m of revenues, correspondingly, vis-à-vis EUR75m and EUR33m in 2020. Exports
contributed EUR218m, or 44% of the consolidated revenues. Gross profit increased by 80% y-o-y to EUR219m. Cost of sales
increased by 19% y-o-y to EUR416m. EBITDA grew by 78% y-o-y to EUR201m on higher contribution from Agriculture and Sugar
Production. As a result, Net profit for 2021 totalled at EUR122m, a 14x higher than in 2020.
SUMMARY BALANCE SHEET
EURk YE20 YE21
Right-of-use asset (mainly land) 94 178 117 058
Biological assets 23 917 27 703
PP&E and other 199 053 200 531
Non-current assets 317 148 345 292
Inventories, including RMI* 107 482 227 040
Biological assets 21 452 41 438
AR and other 42 826 65 024
Cash and equivalents 22 448 11 763
Current assets 194 208 345 265
Total assets 511 356 690 557
Equity 337 326 495 142
Long-term loans 35 078 20 855
Lease liability (mainly land) 72 600 92 182
Other 5 935 4 668
Non-current liabilities 113 613 117 705
Short term debt and similar 18 008 17 630
Current lease liability (mainly land) 25 864 33 080
Other 16 545 27 000
Current liabilities 60 417 77 710
Total equity and liabilities 511 356 690 557
EBITDA LTM 113 421 201 459
RMI* 74 074 170 670
Net debt total** 129 102 151 984
ND total/EBITDA (х) 1.1 0.8
Adjusted net debt = (ND-RMI) 55 028 (18 686)
Adj ND/EBITDA (x) 0.5 (0.1)
Solvency ratio 0.7 0.7
*RMI = Finished Goods **Net Debt = LT and ST debt + Lease Liabilities - Cash
As of the YE21 Lease liabilities grew from EUR98m to EUR125m due to increase in maturity period of lease agreements and land
rental rates. Net debt/EBITDA improved from 1.1x to 0.8x. Net debt excluding lease liabilities decreased from EUR31m to EUR27m.
SUMMARY CASH FLOWS
EURk 2020 2021
Pre-tax income 9 209 128 773
Depreciation & Amortisation 55 510 51 386
Financial interest expenses, net 10 433 4 274
Interest on lease liability 22 162 20 814
Changes in FV of BA and AP* (54 084) (143 835)
Disposal of revaluation in AP in the COS 43 314 87 747
Forex gain/loss 17 134 (1 003)
Income taxes paid (2 346) (5 937)
Working Capital changes 51 222 (85 235)
Other 3 684 305
Operating cash flows 156 238 57 289
Investing cash flows (13 634) (4 017)
Debt proceeds 81 720 82 016
Debt repayment (169 430) (100 151)
Dividends paid - (12 155)
Purchase of treasury shares - (576)
Finance interest paid (8 292) (3 160)
Land lease repayment (30 949) (30 827)
Financing cash flows (126 951) (64 853)
*FV – Fair Value, BA – Biological Assets, AP – Agricultural Produce
Astarta reported Operating cash flows of EUR57m vs EUR156m in 2020 due to changes in working capital and fair value of bio-
logical assets and agricultural produce reflecting change in soft commodity prices. Operating cash flows before Working Capital
changes increased to EUR143m (EUR105m in 2020). Investing cash outflow decreased from EUR14m to EUR4m on the back
of proceeds from disposal of subsidiaries. In 2021 the Company distributed annual dividends for 2020 of EUR0.5 per ordinary
share, with the total amount of EUR12m.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
REPORT ON
OPERATIONS
Agriculture 16
Sugar Production 19
Soybean Processing 22
Cattle Farming 24
Shareholders and Share Price Performance 26
Risk Management 27
Outlook 31
16 17
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Second year in a row Astarta
practices organic farming
— production of crops
without the use of synthetic
chemicals or genetically
modified components,
thereby promoting healthier
and more sustainable use
of natural resources. In
2021 the area under organic
farming was 1.8kha. Harvest
of soybeans, winter wheat,
sunseeds, corn, millet and
mustard totalled 3.8kt.
Organic produce was sold
domestically and exported
to EU. All organic products
are certified according to
Ukrainian and EU legislation
on organic farming (Organic
Standard and Bio Suisse).
AGRICULTURE
1.6mt, 7% higher y-o-y. Soybeans
output grew by 51% to 94kt on back of
16% y-o-y increase in acreage to 31kha
and a record 3.0t/ha yield.
Agricultural segment is an export-
oriented business, with overseas sales
accounting for 84% of the segment
revenues. Exports of grains and
oilseeds by volume amounted to 786kt
in 2021, down by 11% y-o-y on lower
2020 harvest which was sold during
2021 calendar year.
38%
Share in consolidated revenues
EUR185 m
Segment revenues
84%
Export sales (by value)
KEY CROPS ACREAGE
AND GROSS OUTPUT
2020
kha
2020
kt
2021
kha
2021
kt
Corn 61 418 59 508
Wheat 48 230 47 268
Sunseeds 41 89 28 76
Soybeans 27 63 31 94
Rapeseeds 1 4 7 23
Sugar beets 34 1 483 33 1 584
SALES VOLUMES OF KEY
CROPS AND REALIZED
PRICES
2020
kt
2020
EUR/t
2021
kt
2021
EUR/t
Corn 630 150 483 176
Wheat 265 169 290 206
Sunseeds 83 325 45 469
Rapeseeds 12 369 28 503
Higher yields combined with price
growth for agricultural products and
increased sales volumes of wheat in
2021 turned into a higher Agriculture
segment revenues of EUR185m, up
6% y-o-y.
Gross profit more than doubled and
reached EUR153m. EBITDA increased
from EUR80m in 2020 to EUR154m
in 2021, the corresponding margin
increased from 46% to 83% in 2021.
Favourable growing conditions in
the Company’s area of operations
boosted production and contributed
to record yields in grains and oilseeds,
in particularly wheat, soybeans
and rapeseeds. All key crops’ yields
increased significantly in 2021 (+10-
30% y-o-y), and the volume of grains
and oilseeds reached 974kt, 20%
above 2020.
Corn traditionally remained a key crop
with 8.6t/ha yield (compared to 6.9t/
ha in 2020) and 508kt (+22% y-o-y)
output. Sugar beet harvest totalled
FINANCIAL RESULTS
EURk 2020 2021
Revenues, including 175 137 185 049
Corn 94 440 85 126
Wheat 44 726 59 764
Sunseeds 26 914 21 324
Rapeseeds 4 515 14 257
Cost of sales, including (155 787) (177 531)
Land lease depreciation (17 740) (17 729)
Changes in FV of BA & AP* 52 721 145 262
Gross profit 72 071 152 780
Gross profit margin 41% 83%
G&A expenses (12 772) (16 648)
S&D expenses (18 129) (19 962)
Other operating expenses (2 882) (1 462)
EBIT 38 288 114 708
EBITDA 80 190 153 966
EBITDA margin 46% 83%
Interest on lease liability (20 132) (19 220)
CAPEX (10 182) (11 465)
Cash outflow on land lease liability (32 421) (31 494)
*FV – Fair Value, BA – Biological Assets, AP – Agricultural Produce
ASTARTA YIELDS VS AVERAGE UKRAINIAN
t/ha
2020
AST
2020
UKR
2021
AST
2021
UKR
Corn 6.9 5.6 8.6 7. 5
Wheat 4.8 3.8 5.8 4.6
Sunseeds 2.2 2.1 2.7 2.5
Soybeans 2.3 2.1 3.0 2.7
Rapeseeds 2.6 2.2 3.2 2.9
Sugar beets 43 42 47 47
ASTARTA’S GRAINS AND OILSEEDS YIELDS (GROSS), t/ha
2017
6,4
9,8
8,7
6,9
8,6
5,1
4,7
5,1
4,8
5,8
2,3
2,9
2,9
2,2
2,7
2,2
2,9
2,5
2,3
3,0
2,6
3,2
20192018 2020 2021
Corn
Wheat
Sunseeds
Soybeans
Rapeseeds
Source: Company’s data
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
18 19
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The Company’s silos handled 1.1mt
of grain and oilseed crops during
2021, up 34% y-o-y. Extra 12kt silo
capacity was added in Krasyliv in
the Khmelnytsky region in 2021,
increasing the total grain and oilseeds
storage capacity to 562kt.
In 2021 the in-house IT AgriChain
Scout module was extended to 100%
of the Company’s arable land area (vs
75% in 2020). The module is aimed
at improving harvest predictability
by integrating crops monitoring,
agrochemical and meteorological
data and plant vegetation status.
Along with the overall economy the
Ukrainian agriculture was negatively
affected by the new Covid variants,
subdued economic growth, along with
a sharp increase in energy prices,
leading higher prices for services and
products, including for grain drying,
transportation and fertilizers.
According to the Ministry of Agrarian
Policy and Food of Ukraine (Minagro)
Ukraine had a new record-high
harvest of corn in 2021 of 40mt,
with an average yield of 7.5t/ha. Corn
prices grew by 38% y-o-y supported
by the Chinese demand, coming from
pork production rebound after a long
period of African Swine Fever. Since
Ukraine produces high-quality non-
GMO corn it received a premium price
and preference by China.
2021 wheat harvest totalled 32mt (vs
25mt in 2020) from the area of 7mha
(5% higher y-o-y). Wheat yielded 4.6t/
ha, compared to 3.8t/ha in 2020.
Price positive factors such as poor
harvest prospects in USA, Turkey and
Iran, export duties on Russian wheat,
lower quality crop in the EU helped
Ukraine to sell its record harvest to
foreign markets at an annual average
price of EUR217/t (+22% y-o-y).
In December 2021 the Ukrainian
grain prices started a downward slide
under the pressure from international
markets.
To stem food price growth and to equal
fiscal terms for agriculture and food-
processing industries, the VAT rate for
certain agricultural products, including
wheat, corn, soybeans, sunseeds and
rapeseeds, was reduced from 20% to
14% from March 2021.
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
lan-20
Apr-20
Jul-20
Oct-20
Jan-21
Apr-21
Jul-21
Oct-21
Jar-22
Feb-22
300
250
200
150
100
50
0
Wheat Ukraine, CPT Corn Ukraine, CPT
Source: APK-inform
GRAINS PRICE PERFORMANCE, EUR/t
Average price 2021:
Corn – EUR216 (+38% y-o-y)
Wheat – EUR217 (+22% y-o-y)
SUGAR PRODUCTION
party sugar beet supply was about
20% of total coming from growers via
Astarta’s Partnership Centre (PC).
“A” grade quality sugar output was
96% of total in 2021 (incl. raw cane
sugar processing) versus 99% in 2020
but the total volume increased by 46%
y-o-y to 326kt. The share of sugar with
turbidity of up to 20 units increased
from 31% to 32% of total in 2021.
Astarta is the sector leader in Ukraine
and increased its share in domestic
sugar production to 22% in 2021, also
due to adding volumes from raw cane
sugar refining.
Major customers include confectionary,
beverage and retail companies (c. ½ of
total by volume).
Astarta enjoyed positive market
environment last year. In the first half
of 2021 domestic market faced sugar
shortages amid decrease in domestic
production in the previous season
due to weak sugar beet yields. As a
result, sugar price reached USD655/t
excl. VAT (up 66% y-o-y).
35%
Share in consolidated revenues
EUR170 m
Segment revenues
100%
Domestic sales of sugar
Strong demand and higher prices led
to a significant increase in revenues by
34% y-o-y to EUR170m in 2021. Gross
profit margin improved by 5pp to 27%.
EBITDA increased from EUR22m in
2020 to EUR36m in 2021.
Sugar sales decreased by 12% y-o-y
to 290kt in 2021 on lower sugar beet
harvest and processing volumes from
the previous season.
Favourable weather conditions
allowed Astarta to achieve better
sugar beet yield (up by 10% y-o-y to 47
t/ha) in 2021. Astarta’s sugar plants
processed 1.8mt of sugar beets,
compared to 1.6mt in 2020. Third-
FINANCIAL RESULTS
EURk 2020 2021
Revenues 126 973 170 197
Cost of sales (98 728) (123 711)
Gross profit 28 245 46 486
Gross profit margin 22% 27%
G&A expenses (6 118) (8 667)
S&D expenses (7 315) (8 205)
Other operating expenses (2 708) (2 045)
EBIT 12 104 27 569
EBITDA 21 522 35 671
EBITDA margin 17% 21%
CAPEX (1 622) (2 249)
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
20 21
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The Company continuously
strengthens customer
relationships by focusing
on quality, innovations and
sustainability. To widen
its product range Astarta
launched a pilot production
of inverted sugar syrup
used by beekeepers. Pilot
volume of 35t was sold to
75 customers. Following the
market acceptance of the
new product, the Company
plans to increase its output.
The project helped to expand
Astarta’s ecosystem by
establishing partnership with
beekeeping organisations,
key honey producers and
exporters.
Ukraine turned into an importer of
124kt (out of 260kt quota for 2021)
of raw-cane sugar for processing at
a preferential 2% rate of import duty.
As a socially responsible company,
Astarta was one of two Ukrainian sugar
producers to create sugar reserves
in the interest of its consumers
and ensure food security and price
stabilization. The Company’s sugar
plant refined 61% raw-cane sugar
volumes imported into Ukraine for
processing in 2021.
According to the National Association
of Sugar Producers “Ukrsugar” beet
sugar output totalled 1.4mt (up by 25%
y-o-y) with 33 sugar plants running in
2021. As domestic consumption is
estimated at 1.3mt, the production
is expected to fully satisfy internal
demand during the season. The
acreage under sugar beet grew to
227kha, or 20kha more than in 2020.
Weather conditions were favourable
for the plant and sugar content growth
(17% in 2021 vs 16% in 2020), yields
up to 47t/ha (compared to Ukraine’s
average 42t/ha in 2020).
The new sugar production season
was characterised by sharp gas price
increases leading to production cost
growth, since energy is the second
largest production cost item after
sugar beets. Prices for mineral
fertilizers also rose and increased
costs of growing sugar beets in the
new season.
The international sugar market was
characterised by production shortfalls
in some major producing countries,
resulting in a tight global sugar
balance and an upward pressure on
prices. Since the beginning of 2021,
expectations of a sugar deficit, rising
global prices for all raw materials and
utilities (especially gas) caused white
sugar prices to hike to an annual
average of USD471/t (increase of 25%
y-o-y).
Fluctuations in ethanol pricing linked
to price of sugar cane, also contributed
to the volatility of prices for raw cane
sugar, resulting in an annual average
of USD394/t ( up by 45% y-o-y).
On the back of domestic sugar market
imbalance and high domestic prices
sugar exports from Ukraine declined
from 151kt in 2020 to 26kt in 2021.
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
lan-20
Apr-20
Jul-20
Oct-20
Jan-21
Apr-21
Jul-21
Oct-21
Jar-22
Feb-22
700
600
500
400
300
200
100
0
White sugar, Ukraine White sugar, LIFFE Raw sugar, NYBOT
Source: Bloomberg
GLOBAL SUGAR PRICES, USD/t
Average sugar price 2021:
Ukraine — USD655 (+66% y-o-y)
LIFFE — USD471 (+25% y-o-y)
NYBOT — USD394 (+45% y-o-y)
UKRAINIAN SUGAR MARKET SHARE (INCL. RAW SUGAR REFINING), %, 2021
Source: Ukrsugar, Astarta’s estimates
TOTAL SUGAR
PRODUCTION, 2021
1 563kt
Ukrprominvest-Agro
17%
Other 44%
Astarta
22%
Radekhiv Sugar
17%
PRODUCTION 2020 2021
Total sugar production, kt 226 340
Sugar from beets, kt 226 266
Sugar beet processed, kt 1 559 1 844
Own sugar beet, % 86% 80%
Sugar from raw cane sugar, kt nil 73
Raw cane sugar processed, kt nil 75
SALES VOLUMES OF SUGAR AND SUGAR
BY-PRODUCTS AND REALIZED PRICES
2020 2021
Sugar, kt 329 290
Sugar by-products*, kt 91 70
Sugar prices, EUR/t 351 555
* Granulated sugar beet pulp, molasses
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
22 23
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
AdamPolSoya
11%
Other
46%
Viktor&K
10%
MHP
20%
Astarta
13%
SOYBEAN
PROCESSING
18%
Share in consolidated revenues
EUR90 m
Segment revenues
66%
Export sales of soybean products (by value)
SALES VOLUMES
OF SOYBEAN
PRODUCTS
AND REALIZED
PRICES
2020
kt
2020
EUR/t
2021
kt
2021
EUR/t
Soybean meal 142 338 123 462
Soybean oil 40 651 31 1 035
2021 Soybean Processing segment
revenues were boosted by 20% to
EUR90m by strong selling prices for
soybean products. Gross profit margin
went down from 15% to 8% in 2021
due to higher cost of sales. EBITDA
decreased by 32% to EUR5m and
EBITDA margin dropped by 4pp to 6%
in 2021.
Astarta crushed 172kt of soybeans
during the reporting period, down by
17% y-o-y, on the back of modest crop
harvest in 2020. Share of in-house
soybeans processed increased to
43% from 28% in 2020.
Production and sales of soybean meal
declined by 16% and 13% to 128kt
and 123kt correspondingly as a result
of reduced processing volumes of
soybeans. While average selling price
advanced by 37% y-o-y to EUR462/t.
PRODUCTION
kt 2020 2021
Soybeans processed 208 172
Soybean meal 152 128
Soybean oil 40 32
FINANCIAL RESULTS
EURk 2020 2021
Revenues, including 75 157 89 814
Soybean meal 47 873 57 006
Soybean oil 25 999 31 598
Cost of sales (64 060) (82 379)
Gross profit 11 097 7 435
Gross profit margin 15% 8%
G&A expenses (636) (774)
S&D expenses (4 326) (2 281)
Other operating expenses (246) (847)
EBIT 5 889 3 533
EBITDA 7 446 5 084
EBITDA margin 10% 6%
CAPEX (481) (407)
Sales of soybean oil dropped by 24%
to 31kt (40kt in 2020) on back of
lower crushing volumes. This was
compensated by higher average
selling price of EUR1,035 (up 59%
y-o-y) vs EUR651 in 2020.
Share of exports decreased to 66% of
Segment revenues in 2021 from 76%
in 2020. Astarta’s soybean products
were exported to 14 countries in
2021.
Production of soybean meal and oil by
domestic crushing plants decreased
by 3% y-o-y to 1.3mt. In 2021 Astarta
retained the position of the second
largest soybean processor with 13%
of domestic output.
In 2021 the Ukrainian soybean harvest
totalled 3.4mt, with the average yield
2.7t/ha, compared to 2.8mt and
2.1t/ha in 2020.
2021 was a turbulent year for the
global soybean oil market due to the
increasing supply volumes to biofuels
production, as some major global
consumers were using soybean oil
as the main feedstock to produce
biodiesel, therefore squeezing its
availability as an edible oil.
Domestic soybean products prices
are linked to an international soybean
oil market as exports account for
92% of total production. In 2021
soybean oil prices soared by 62%
compared to 2020 to EUR981/t, on
the back of economic recovery from
Covid as consumption normalized,
with a temporary price reduction in
July-August following the decline in
biodiesel demand in USA. Domestic
soybean meal priced increased by
20% y-o-y to EUR461/t The firm
demand for the by-product in the main
consuming countries explains price
increases.
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
lan-20
Apr-20
Jul-20
Oct-20
Jan-21
Apr-21
Jul-21
Oct-21
Jar-22
Feb-22
1200
1000
800
600
400
200
0
Soybean oil Soybean meal Soybean
UKRAINIAN PRICES FOR SOYBEAN PRODUCTS AND SOYBEANS, EUR/t
Average price 2021:
Soybeans — EUR467 (+40% y-o-y)
Soybean oil — EUR981 (+62% y-o-y)
Soybean meal — EUR461 (+20% y-o-y)
UKRAINIAN SOYBEAN PROCESSORS SHARE IN
DOMESTIC OUTPUT, %, 2021
Source: AgroChart, Company’s data
Source: APK-inform
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
24 25
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CATTLE FARMING
8%
Share in consolidated revenues
EUR38 m
Segment revenues
100%
Domestic sales
PRODUCTION 2020 2021
Milk production, kt 93 97
Herd, k heads 22 22
Milk yield, kg/day 21.4 22.6
SALES VOLUMES OF MILK
AND REALIZED PRICES
2020 2021
Milk sales, kt 90 94
Milk price, EUR/t 330 375
2021 Cattle Farming segment revenues
amounted to EUR38m (EUR33m in
2020), up by 16% y-o-y mainly due to
the increase in average selling price of
raw milk. Gross profit increased by 9%
to EUR10m in 2021. EBITDA was flat
at EUR9m with corresponding margin
declining from 26% to 23%.
Sales volumes of milk increased 4%
y-o-y to 94kt at an average selling
price of EUR375/t (up 14% y-o-y). Yet
inflation in raw material costs and
energy offset milk price increase.
Astarta produces premium quality
raw milk for industrial customers
which process it into dairy products
The Company operated 42 dairy
farms housing over 22k cows in three
regions. The herd is based on high-
end Holstein and Ukrainian black-and-
white dairy breed, with good physical
health and high productivity.
2021 milk production was 97kt,
4% higher y-o-y. Milk output per cow
averaged 22.6kg/day from 21.4kg/
day in 2020 due to improvements
in herd management and its health,
technological enhancement in animal
feed and housing conditions (e.g.,
upgrade of ventilation to reduce
heat stress). Within the framework
of in-house operational efficiency
programme three projects were
implemented at dairy farms leading to
EUR102k savings in 2021.
2021 investments were spent on
maintenance of dairy farms, increasing
their capacities and furthering animal
welfare.
The farm’s livestock feed needs are
almost entirely met in-house. Haylage
and silage come from the crop
growing side of Astarta’s business,
compound feed from the soybean
processing plant, pulp and molasses
- from its sugar plants. The ProFeed
feeding system, introduced in 2020
and implemented at nine farms,
simplifies the feeding process and
allows efficient feed use.
In 2021 the Ukrainian industrial milk
production totalled 2.8mt, flat y-o-y.
The ratio of industrial versus private
household milk production in Ukraine
was 32% and 68% correspondingly.
Domestic premium quality milk prices
increased steadily and averaged
EUR324/t (up 12% y-o-y). The all-time
record was set in November 2021 at
EUR366/t.
The Ukrainian dairy market followed
the trends in the global dairy
sector with price increases in bulk
commodities but tight supply of feed
ingredients leading to increase in feed
costs in 2021.
ASTARTA MILK PRODUCTION AND UNIT MILK YIELD
2017 2018 2019 2020
2021
97
110
106
96
93
22,6
19,7
19,6
20,1
21,4
Milk production, kt Milk yield, kg/day
Source: Company’s data
FINANCIAL RESULTS
EURk 2020 2021
Revenues 33 167 38 474
Cost of revenues (25 015) (26 721)
BA revaluation 1 363 (1 427)
Gross profit 9 515 10 326
Gross profit margin 29% 27%
G&A expenses (1 575) (1 960)
S&D expenses (485) (444)
Other operating income/expense (16) (261)
EBIT 7 439 7 661
EBITDA 8 748 8 804
EBITDA margin 26% 23%
CAPEX (465) (1 490)
#AstartaRecommends
Jointly with its key business
partners the Company
launched a promotion project
“Astarta Recommends”
about milk products and
dairy companies in 2021.
The project aims to
popularise Astarta’s partners
and their cooperation,
describe the milk production
process, explain food safety
measures, compliance with
animal welfare legislation
and, thereby boost consumer
confidence.
UKRAINIAN PREMIUM QUALITY MILK PRICE, EUR/t
Source: Infagro
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
lan-20
Apr-20
Jul-20
Oct-20
Jan-21
Apr-21
Jul-21
Oct-21
Jar-22
Feb-22
400
350
300
250
200
150
50
0
Average price 2021:
Milk: EUR324 (+12% y-o-y)
2021 average price Milk price
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
26 27
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Astarta is a public company with
shares listed on the Warsaw Stock
Exchange since 2006.
As of the end of 2021, there were
two major long-term shareholders:
the family of Viktor Ivanchyk
(the CEO), who owned 40.0% of
total shares outstanding through
Albacon Ventures Limited, and
Fairfax Financial Holdings Ltd
which owned 29.9%. The free
float portion of Astarta’s shares is
held mainly by Polish institutional
investors, EU and US investment
companies.
In May 2021 Astarta announced
the fourth 18-month’s buyback
programme and repurchased 0.2%
of shares. As of the end of the year
the Company held 3.0% in treasury
shares.
In June 2021 the Company
distributed debut dividends of
EUR0.5 per ordinary share, with
the total amount of EUR12.5m.
Astarta’s share price was strongly
influenced by developments in the
agricultural and sugar markets in
2021 and the Covid pandemic.
SHAREHOLDERS AND SHARE
PRICE PERFORMANCE
DATA/YEAR 2017 2018 2019 2020 2021
Opening price (PLN per share) 55 52 24 16 29
Highest trading price (PLN per share) 72 58 33 27 57
Lowest trading price (PLN per share) 46 23 15 10 28
Closing price (PLN per share) 51 23 16 26 42
Closing price (EUR per share) 12 5 4 6 9
Market capitalisation as of 31 December PLNk 1 287 250 575 000 400 000 655 000 1 060 000
Market capitalisation as of 31 December EURk 308 626 133 721 94 025 143 121 230 963
Dividend* EUR/share nil nil nil nil 0.5
Dividend yield % nil nil nil nil 4.3
Feb-17
Apr-17
Jun-17
Aug-17
Oct-17
Dec-17
Feb-18
Apr-18
Jun-18
Aug-18
Oct-18
Dec-18
Feb-19
Apr-19
Jun-19
Aug-19
Oct-19
Dec-19
Feb-20
Apr-20
Jun-20
Aug-20
Oct-20
Dec-20
Feb-21
Mar-21
May-21
Jul-21
Aug-21
Oct-21
Dec-21
160
140
120
100
80
60
40
20
0
Astarta WIGUKR
ASTARTA AND WIG-UKR PERFORMANCE IN 2017-2021
(factor = 100 as of 02 January 2017)
Source: Bloomberg
(25,000,000 shares)
SHAREHOLDER STRUCTURE AT
31 DECEMBER, 2021
Fairfax
29.9%
Ivanchyk Family
40.0%
Free float
27.1%
Treasury shares
3.0%
Source: Company’s data
Communication
and consultation
Control
and monitoring
Analysis
and assessment
Astarta defines risk management as a process for risk identification, assessment, monitoring and control. The key purpose of
the risk management is to find an optimal balance between the Company growth and risks that are accepted.
The Company considers governance of top business risks a high priority. It focuses on risks with a high impact on the business
and/or high probability of occurrence, taking into consideration the Company’s risk appetite. The risk appetite refers to the nature
and extent of risks the Company is willing to incur to achieve strategic objectives. Among others, the risk appetite considers
revenue growth, earnings sustainability, environmental impact, employee well-being, health and safety, and value creation for all
stakeholders.
THE COMPANY IDENTIFIES FOUR GROUPS OF RISKS:
• regulatory;
• financial;
• commercial;
• operational.
The organizational structure of risk management is based on the three lines of defence model. This approach allows
establishing a system of risk management that provides reliable process for identification, assessment, control and monitoring
of all types of risks at all levels within the Company. The management has primary responsibility for the daily oversight of
risks. They form the first line of defence. The functions of the second line of defence are to identify and incorporate legal
and regulatory requirements and risk appetite into internal regulations, to support and monitor risk control by operational
managers and to integrate risk acceptance into strategic planning. The second line of defence is conducted by dedicated
internal committees. The third line of defence is the internal audit function. The internal audit service evaluates for the
Board and Senior management the effectiveness of the first and second lines and provide an independent assessment of
effectiveness of risk management.
1. Identification. The Company identifies internal and external risks which have an impact or can have an impact on the
business.
2. Analysis and assessment. The Company evaluates the nature of risks which can have considerable impact on the
Company’s ability to achieve its goals including risk probability and degree of the impact on the business.
3. Control and monitoring. The control and monitoring are conducted at all levels by the owners of risks within the operational
process.
4. Communication and consultation. In order to provide the participants of the risk management process with accurate and
timely information about risks the Company undertakes distribution of relevant in-house information.
RISK MANAGEMENT
KEY COMPONENTS OF RISK MANAGEMENT PROCESS
Identification
* Dividends were first distributed in 2021
OVERVIEW
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ASTARTA ANNUAL REPORT 2021
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MATERIAL RISK FACTORS AND THREATS
RISK IMPACT MITIGATION
REGULATORY RISKS
Legal risk Non-compliance with applicable
legislation can expose the business to
legal liabilities, penalties and material
losses (financial, reputational).
Non-compliance of transactions with
current legislation.
The business may be affected
by changes in fiscal, tax or other
regulations.
• Adherence to relevant compliance
procedures and legislation, regular
management of risks by the
compliance committee. Professional
competence of the staff
• Participation in industry associations
for the purpose of representing the
interests of the Company
Compliance risk Losses (financial, reputational) due
to violations of laws, corporate rules,
codes of conduct, etc.
• Adherence to the relevant procedures
of current legislation and internal
policies. Professional competence
of the staff responsible for the
compliance
• Raising staff awareness and
knowledge of relevant compliance
procedures and regulations
Reputational risk Inappropriate actions of business
partners, management or employees
can harm the good name of the
Company resulting in reputation
impairment
• Open and proactive communication
policy
• Appropriate response and contingency
plans
• Encouraging ethical behavior of
employees
Corruption risk The inability to manage the corruption
risk may damage Company’s
reputation and impact financial
results
• Strict adherence to the Anticorruption
policy and controls
• Robust internal audit to identify any
discrepancies in the application of
the Anticorruption policy in business
processes
FINANCIAL RISKS
Liquidity risk The Company’s inability to meet
its financial obligations in a timely
manner may have a negative impact
on the financial results
• Strategic and financial assessment of
the Company’s current performance
and quick response to deviations from
set targets
• Prioritization of investment projects
and steady pace of maintenance
capex
• Diversification of sources of financial
resources
RISK IMPACT MITIGATION
FINANCIAL RISKS
Interest rate risk Changes in interest rates may affect
the financial performance
• A financing strategy aimed at utilising
opportunities to fix interest rates. For
more details see the corresponding
notes on the consolidated financial
statements
Currency risk High volatility of the Ukrainian hryvnia
and exchange rate fluctuations may
negatively affect the business
• Balanced sales strategy ensuring
sufficient export revenues
• Matching the timing of export
sales with the purchase of inputs
denominated in foreign currencies
• Fixing purchase and sales prices
COMMERCIAL RISKS
Price risk (for
purchasing/
selling)
Volatility of prices for raw materials,
grains, oilseeds, sugar, milk and
soybean products may affect
operating results and profitability
• Product price fixing
• Diversified portfolio of products
• Balanced portfolio of customers
• Flexible sales policy
• Tight control of the trade positions
• Strategic long-term cooperation with
suppliers and a diversified supplier
base
• Energy and other resources saving
Counterparty risk Non-fulfilment of financial obligations
by counterparties may adversely
impact the Company’s financial
position
• Risk management policies and
counterparty risk assessment systems
• Regular analysis, verification and
monitoring of counterparties
OPERATIONAL RISKS
Climate risk Unfavourable weather conditions
and low precipitation could have a
negative impact on crops’ yields and
per-unit cost of production.
Introduction of legislation aimed
at reduction of GHG can result in
additional taxes and/or fines. Decline
in demand for some products due
to change in consumer preferences
in favour of new climate sustainable
products
• Location of business units in different
climatic zones of Ukraine to ensure
the geographical diversification of the
risk
• Expanding irrigation
• Adjusting the crop mix towards
changing climate conditions
• Modern agronomic solutions including
precision farming to minimize and
deliver inputs at the right place and
time
• Assessment of global food trends and
scenario analysis
• Cooperation with food industry leaders
and key off-takers
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ASTARTA ANNUAL REPORT 2021
RISK IMPACT MITIGATION
OPERATIONAL RISKS
Personnel risk Lack of experienced staff can
negatively impact the business
• Educational projects to encourage
young people to join agriculture and
promote attractiveness of the industry
for prospective employees
• Internship for students with a further
job placement
• Professional training and development
programmes
Technical/
Technological risk
Deterioration of product quality may
negatively affect the Company’s
reputation and customer relationships.
The use of outdated technologies may
carry risk of productivity loss
• Quality management and certification
• In-house control systems
• Modernisation of production
processes and technologies
• R&D solutions
Ecological risk Under business expansion the
Company may face a risk of
environmental components pollution
(air, water, soil, flora and fauna) which
can result in disruption of expansion
plans or complicate the business
activities.
• Strict environmental monitoring
according to national legislation and
internal corporate standards.
Logistics and
storage risk
Logistical challenges may negatively
impact relations with clients and
interfere with business processes
• Inhouse network of grain and oilseeds
storage and handling facilities
• Inhouse transportation fleet
IT risk/cyber risk Data loss or dissemination may have
a negative impact on the financial
position and reputation of the
Company
• Implementation of the information
security and cyber-risk management
systems, Business Continuity Planning
(BCP)
• Cloud storage systems, systems of
independent servers, and backup
systems
Assets loss risk Loss of assets as a result of natural
disasters, robbery, fraud, military
actions, etc.
• Assets insurance, if commercially
available
• Efficient health and safety system
including fire-fighting capability
• Monitoring and control of employees’
actions (internal security function).
Video surveillance
ASSESSMENT OF RISKS ASSOCIATED WITH MILITARY INVASION OF UKRAINE
While the Group’s operations were not largely impacted so far and management prepared its 12 months budget based on the
known facts and events, 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.
Main specific risks factors include:
• Ability to negotiate with the banks and attract new credit limits (facilities) in Q3 2022, to finance operating activities of
the Group. This is contingent upon uncertainty related to availability and will of the banks to provide such new financing
• Ability to obtain cash from the banks available under the already approved, unused credit facilities granted to date or
expected to be obtained during the year. Because those facilities are not legally binding and depend, on the ability of
banks (mainly Ukrainian banks) to provide cash
• The safety of fixed assets and inventories (the assets), and access to logistic routs is highly contingent upon the
development of military activities. There is a significant uncertainty of whether the assets or routs of transportation might
be damaged or available and therefore or the Group would not be able to move its assets between locations, customers
and suppliers. This may result in additional costs or loss of revenues
In order to analyze the impact of these risks and support its ability to continue as a going concern, management has prepared
actualized financial forecast as of the end of March 2022 which shows that the ability of Group to operate as a going concern
would be dependent on the following significant assumptions:
• Banks have already approved most of the credit facilities required for the financing of Q1, Q2 and partially Q3 or the
approval is in pipeline with the banks. Management would be able to draw the cash from the approved credit facilities to
finance operating activities
• Management would be able to negotiate with the banks and attract additional credit facilities in Q3 2022. Historically
management maintained a fruitful relation with the banks and was able to attract new financing
• When preparing the actualized financial forecast, management has made the following adjustments to the initial financial
forecast, i.e.:
- decreased sales volume due to possible complications with altering the available routes of transportation, i.e. through
the western border instead of the ports of the Black Sea
- decreased costs due to postponement of large investment projects and removing the non-essential capital
expenditures.
OUTLOOK
Since Russia started the full-scale war against Ukraine all local businesses operate under conditions which make it difficult to
specify development plans in detail. Currently the major task is to ensure food security for the country and concentrate on the
short-term objectives of vital importance for Ukraine and its citizens. After the end of war, the business will be able to return
to implementing previously developed projects considering the new post-war realities.
Among the general directions for the development of Astarta should be:
• Investments into new products and jobs such as new processing and storage capabilities.
• Focus on climate change adaptation and mitigation in agricultural activities through the use of drought resistant varieties
of spring crops, applying reduced tillage to preserve moisture in the ground, tailoring density of sowing and fertiliser
application to specific soil conditions irrigation and sequestration of carbon in soil.
• Benefit from decarbonisation of the industrial processes of Astarta’s business via reduction of natural gas consumption
at the sugar mills under the energy efficiency programme and expansion of bioenergy use.
• In partnership with EBRD and E&Y develop a comprehensive system of ‘climate corporate governance’ covering GHG
methodology for Scope 1-3, scenario analysis for 1.5ºС-4ºС growth in global temperature, identifying physical and
transitional climate risks, analysis of existing and prospective decarbonisation initiatives in crop and dairy farming, food-
processing, setting short- and long-term GHG reduction targets (SBTi).
OVERVIEW
REPORT
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STATEMENTS
SUSTAINABILITY
Energy 35
Waste 36
Emissions and Acting on Climate Change 38
Water Withdrawal and Discharge 41
Animal Welfare 43
Land Use and Biodiversity 44
Human Capital 45
Occupational Health and Safety 48
Training 49
Diversity and Equal Opportunities 51
Freedom of Association
and Collective Bargaining 52
Human Rights 52
Certification and Sustainable
Products and Services 53
Local Communities 54
Managing COVID-19 Related Risks 56
Business Ethics 57
Anti-corruption 58
Task Force on Climate-related
Financial Disclosures 58
EU Taxonomy Disclosure 61
34 35
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ASTARTA ANNUAL REPORT 2021
As the world’s population is expected to continue its growth
the global food demand will consequently put pressure on
the agriculture and food systems which need to produce
more food. At the same time the amount of land suitable
for agriculture is expected to decline due to climate
change, pollution, water scarcity, soil erosion etc. In these
circumstances the agriculture sector needs to become not
only more productive but also more sustainable. Agriculture
has a significant potential for carbon sequestration by
removing CO
2
from the atmosphere and storing it in the
soil. In order to intensify this process the agriculture sector
needs to switch from conventional tillage to minimal or no-till
farming. There is a significant difference in carbon footprint
depending on the way the farming is performed. Traditional
tillage adds to the CO
2
emissions while no-till farming,
planting cover crops, building up more organic matter in
the soil removes CO
2
from the atmosphere. Astarta plans to
adjust its farming operations to reduced tillage.
KEY DEVELOPMENTS IN 2021
Astarta acknowledges the importance of the agriculture
sector in curbing the global warming which is the key driver
for many changes in the climate system and pays a lot of
attention to sustainable farming.
In partnership with the European Bank for Reconstruction
and Development Astarta initiated development of a climate
action plan aimed at identifying major climate change
risks and opportunities, climate change mitigation actions,
carbon reduction targets, and general improvement of its
corporate governance.
In 2021 Astarta joined a regenerative agriculture project
of Syngenta, LLC (Ukraine) to develop farming practices
for sequestering carbon in the soil and enhance its health.
The Company developed a Baseline report for 2020 and
received a set of recommendations to decarbonise its field
operations through reduced tillage, cover cropping, use of
emission inhibitors and lower consumption of fertilisers and
energy. Astarta intends to follow the recommendations and
reduce its carbon footprint over several years. The reduction
will be measured by the Cool Farm Tool. After independent
verification the Company plans to create Voluntary Carbon
Credits for sale.
Astarta was awarded for introduction of principles of circular
economy by ECОtransformation-2021 - the local platform for
ecological and technological solutions.
The Company’s crop growing subsidiary List-Ruchki confirmed
the status of an organic producer and successfully passed
the certification of land and warehouses by the Organic
Standard and Bio Suisse. Certification allows the Company
to sell its organic products to the European Union.
As a big farmland operator Astarta pays special attention
to the social aspect and supports development of local
communities in the regions of its operations. Having
participated in the XII Corporate Social Responsibility (CSR)
Contest by the Centre for CSR development and EY Ukraine,
Astarta was awarded for the best CSR project “My future in
Agro” among 83 nominees. The project aims at promoting
agricultural profession among young people.
Astarta was also among finalists for the Partnership for
Sustainability Award 2021 contest and was recognised in
the nomination called “Economic growth” for the “SMART
impulse” project devoted to the development of local
communities. In addition, Astarta was the only agricultural
company to become an approved employer of the Association
of Chartered Certified Accountants in Ukraine.
Astarta joined the national initiative “The Green Country”
to reforest the country by planting a billion trees across
Ukraine. Astarta’s employees took an active part in the event
and planted c. 112k trees in different regions of Ukraine.
Traditionally, Astarta is among top employers in Ukraine.
The business magazine “Delo” recognised Astarta among
the five best employers in the country by reputation, social
responsibility, personnel development.
ENERGY
The nature of Astarta’s business implies use of different
energy resources like natural gas which is mainly used by the
Sugar Production and Soybean Processing segments and
liquid fuels mostly consumed in the Agriculture segment.
Sugar production is one of the most energy intensive
processes in the food industry. Astarta acknowledges
that the use of energy resources is directly linked to the
greenhouse gas (GHG) emissions. Thus, efficient energy
management is a top priority for the Company.
Astarta aims to achieve the highest economic effect and
reduce its negative impact on the environment through
developing and implementing energy efficiency programmes.
In 2021 key production sites in the Sugar Productions and
Soybean Processing were successfully certified according to
the international standard ISO 50001 “Energy management”.
In the Sugar Production which is the biggest energy consumer
among its business segments Astarta continuously
implements the energy and resources efficiency programme
based on the Best Available Techniques. The main goal of
the programme is to reduce energy resources consumption
using modern equipment and practices. In 2021 natural gas
consumption per tonne of sugar beet processed declined
by 9% y-o-y to 21.5m3. Overall energy consumption in the
Sugar Production increased by 22% to 2,655k GJ reflecting
new raw cane sugar processing activities which were
introduced in 2021. The share of the Sugar Production in
the total energy consumption was 65%.
The Agriculture segment is the main consumer of diesel used
by agricultural machinery. Astarta continuously improves
energy efficiency through modernisation of field machinery
with higher productivity and lower consumption of fuel. In
2021 diesel consumption per ha of farm land reduced by
2% y-o-y to 71kg/ha as machinery and vehicles running on
gasoline were replace with the new ones running on diesel.
Overall energy consumption in the Agriculture increased
by 2% y-o-y to 1,074k GJ representing a 26% share in total
energy consumption.
Energy consumption in the Soybean Processing reduced
by 15% y-o-y to 232k GJ due to lower soybean processing
volumes in 2021. The share of the segment in total energy
consumption was 6%.
The Cattle Farming increased energy consumption by 7%
y-o-y to 115k GJ due to installation of additional ventilation
equipment to enhance animal welfare. The share of the
segment in total energy consumption was 3%.
Responding to climate change Astarta seeks ways to reduce
its negative impact through the use of sustainable energy
sources like pellets and biogas produced by an in-house
bioenergy facility which allows to partially replace natural
gas at several production sites.
Total energy consumption from renewable energy sources
grew by 11% y-o-y to 115k GJ representing 3% of the
Company’s total energy balance.
Considering different type of fuels used in its business
segments the Company changed its approach to calculation
methodology by adopting “kGJ” as a unit of equivalence to
improve the comparability and accuracy of the data on energy
consumption across business segments and types of energy
used. An automatic data collection and translation system
of energy consumption was developed and implemented in
2021. The system generates a report on specific indicators
related to the amount of energy consumed in absolute and
relative terms in a unified format for all business segments.
The methodology for calculation is based on the Order of
the State Statistics Committee of Ukraine № 374 dated
23.12.2011 “Methodological statements for the formation
of the energy balance”, UNSTATS and internal technical
documentation.
Based on the new calculation methodology the Company
recalculated and restated energy consumption for the
previous reporting period. The updated data is presented
below.
In 2021 Astarta received an ESG Risk Rating
score of 27.4 (vs 32.6 in 2020). As of September
2021, Astarta is ranked No 2 out of 89 companies
that Sustainalytics covers in their Agriculture
Subindustry globally, and 93rd out of 561 in their
Food Products Industry.
For the third year in a row Astarta confirms its high
ESG performance with Silver Medal from Eco Vadis
platform.
In 2021 Astarta submitted debut application to
CDP and was scored D.
OVERVIEW
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
TOTAL ENERGY CONSUMPTION
k GJ 2020 2021
Sugar Production 2 182 2 655
Agriculture 1 050 1 074
Soybean Processing 271 232
Cattle Farming 108 115
Bioenergy Facility 15 4
Total 3 627* 4 080
* restated
TOTAL ENERGY CONSUMPTION PER SOURCE OF ENERGY
k GJ 2020 2021
Non-renewable sources, including 3 524 3 966
Natural gas 2 171 2 378
Liquid fuels (diesel, petrol, LPG) 842 837
Coal 347 587
Electricity purchased 164 164
Renewable sources, including 103 115
Biogas 73 17
Other (pellets and fuelwood) 31 97
Total 3 627* 4 080
* restated
ENERGY INTENSITY PER UNIT OF PRODUCTION
k GJ 2020 2021
Energy used per tonne of sugar produced 7.22 7.1 9
Energy used per tonne of crop grown 0.34 0.33
Energy used per tonne of soybean processed 1.29 1.33
Energy used per tonne of milk produced 1.17 1.19
In the process of sugar beets processing Astarta produces
sugar and generates by-products such as sugar beet pulp
and molasses. Sugar is sold in 50kg polypropylene bags
and in bulk. Bags for sugar packaging are supplied by
third parties. Customers who buy sugar in bags can either
dispose of or reuse these bags. Molasses is sold as is while
sugar beet pulp is partially baked into a granulated product
and partially used as feed for livestock.
The key products produced in the Agricultural segment
are grains and oilseeds as well as sugar beets. Grains
and oilseeds are sold in bulk mainly for export and sugar
beets are processed internally by the Sugar Production
segment. Agricultural waste consists mainly of residue
after harvesting of row crops. Those are left in the fields to
preserve the quality of soil as well as used in cattle farming
as a bedding material for cows. The Agricultural segment
also uses pesticides in crop growing. Pesticides are supplied
by third parties in specialised packaging. After the use of
pesticides, the packaging is disposed through the licensed
companies.
Soybean meal and oil are the key products in soybean
crushing which are sold in bulk. The by-product of the
crushing process is husk which is sold to third parties.
Therefore, the volume of waste generated in this process
is minor.
Milk is the key product produced in the Cattle Farming
segment. The milk is sold in bulk without packaging. The key
element of waste in the Cattle Farming is manure which is
used as a fertilizer on the fields.
In 2021 the Company conducted an independent analysis of
lime cake and filtration sludge for toxicological properties of
hazardous components. According to the analysis, lime cake
and filtration sludge were recognized as materials which can
be used as a fertilizer.
In 2021 the total amount of waste, excluding by-products,
generated by the Company totalled 100kt, down by 85%
y-o-y due to changes in the methodology of calculation of
the filtration sludge (moisture was excluded). Thus, it can’t
be directly compared to the previous year.
WASTE
As a big agroindustrial holding Astarta generates hazardous
and non-hazardous waste in the process of its daily operating
activities. To organise waste collection, temporary storage
and utilization the Company implemented an internal
standard on waste management based on applicable
domestic legislation and international standards.
The waste generated by the Company is determined by the
level of hazard: 1st, 2nd, 3rd and 4th categories in line
with national requirements. The share of hazardous waste
is negligible and mainly comes from fluorescent lamps,
battery packs, used oils, residue from the use of pesticides
etc. Before disposing of hazardous waste, it is temporary
stored in special yards with marked boxes for waste sorting.
To dispose the hazardous waste, Astarta cooperates with
companies that are reputable and licensed by relevant
authorities to handle such waste.
Non-hazardous waste generated by the Company mainly
includes residue from the production process such as
paper, plastic, waste from packaging materials, used tires
etc. Before disposing of non-hazardous waste, it can be
temporary stored at production sites while observing all
appropriate precautions.
TOTAL WASTE GENERATED AND ITS BREAKDOWN BY THE METHOD OF DISPOSAL
Waste by disposal method, kt 2021
Hazard waste (1-3 hazard category) by disposal method:
Recycle (transfer to disposal) 0.19
Total 0.19
Non-hazardous waste (4 hazard category) by disposal method:
Reuse (by facility) 89
Recycle (transfer for disposal (4 category of hazard) 0.11
Landfills 7
Other (sale to third parties) 4
Total 100
OVERVIEW
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
EMISSIONS
AND ACTING
ON CLIMATE
CHANGE
GHG AND OTHER EMISSIONS
Among emissions generated by Astarta’s activities are
greenhouse gas emissions such as carbon dioxide (CO
2
),
methane (CH4), nitrous oxide (N2O), particulate matters
(PM), nitrogen oxides (NO
X
), sulphur dioxide (SO
X
) and others.
The Company developed and implemented the environmental
monitoring system to measure and assess actual and
potential impact of these emissions. The system includes:
• control of air emissions from stationary and mobile
sources;
• efficiency assessment of dust and gas capture;
• control of air emissions at the borders of the sanitary
protection zones;
• training on operating and maintenance of dust and gas
capture for relevant personnel.
In 2021 Astarta expanded disclosure on emissions by adding
indirect GHG emissions from purchased electricity (Scope 2)
and some other elements of indirect GHG emissions from
absorption fields, atmospheric deposition of nitrogen and
manure management (Scope 3).
Under Scope 1 the Company also changed its approach
to calculation of emissions from energy consumption
and Cattle Farming and added emissions from the use of
fertilizers. Therefore, Scope 1 emissions were restated for
the previous period.
Scope 1 emissions
Under an updated methodology, the Agriculture is the
biggest emitter of direct GHG emissions (Scope 1) with
45% share of total. In 2021 the segment generated 160kt
of CO
2eq
(up by 1% y-o-y) with the most significant share of
emissions coming from synthetic fertilizers application (58%
of total) and mobile sources (33%).
Increase in sugar production led to growth of energy
resources consumption in 2021. As a result, direct GHG
emissions by this segment increased by 25% y-o-y to 149kt
of CO
2eq
or 33% of total direct GHG emissions.
The Scope 1 emissions in Cattle Farming comes from cows’
enteric fermentation, manure management, stationary and
mobile sources. In 2021 these remained flat and totaled
69kt of CO
2eq
or 19% of total direct GHG emissions.
Direct GHG emissions from the soybean processing
operations totaled 10kt of CO
2eq
, or flat y-o-y.
In 2021 total direct GHG emissions by the Company came at
388kt of CO
2eq
, representing an 8% y-o-y increase.
Scope 2 emissions
Scope 2 emissions are derived from consumption of
purchased electricity. The Agriculture segment consumes
purchased electricity mainly during the process of cleaning
and drying grains and oilseeds. In 2021 the Agriculture was
the biggest consumer of purchased electricity and emitter
of 7kt of CO
2eq
(down by 10% y-o-y) or 36% of total Scope 2
emissions. The Soybean Processing segment accounted for
27% of total Scope 2 emissions or 5kt of CO
2eq
(down by 27%
y-o-y) in 2021.
The Sugar Production segment uses electricity mainly during
the plant maintenance period. Its share in total Scope 2
emissions is insignificant at 15% or 3kt of CO
2eq
(down by
25% y-o-y).
Total indirect Scope 2 emissions amounted to 20kt of CO
2eq
,
down by 18% y-o-y.
Scope 3 emissions
In 2021 the Company started to quantify indirect Scope 3
emissions from absorption fields, atmospheric deposition of
nitrogen and manure management. The Sugar Production
segment uses absorption fields for wastewater discharge
and its share in total quantified Scope 3 emissions was the
biggest at 61% or 14kt of CO
2eq
(flat y-o-y) in 2021.
In the Agriculture Scope 3 emissions mainly come from the
atmospheric deposition of nitrogen after applying synthetic
fertilisers and manure to soil. The share of the segment was
30% or 7kt of CO
2eq
(down by 2% y-o-y) in 2021. The Cattle
Farming Scope 3 emissions come from manure management
and totaled 2kt of CO
2eq
(flat y-o-y). The Soybean Processing
Scope 3 emissions are insignificant.
SUMMARY DATA ON EMISSIONS
2020 2021
Scope 1 CO
2eq
, kt 359* 388
by gas type
CO
2
200 231
N2O 98 96
CH4 61 61
by segment
Agriculture 162 160
Sugar production 119 149
Soybean processing 10 10
Cattle farming 69 69
by source
Fuel consumption 200 231
Synthetic fertilizers application 94 92
Enteric fermentation 61 61
Manure management 2 2
Manure application to soil 2 2
Scope 2 CO
2eq
, kt 24 20
by segment
Agriculture 8 7
Sugar production 4 3
Soybean processing 7 5
Cattle farming 5 4
Scope 3 CO
2eq
, kt 23 23
by segment
Agriculture 7 7
Sugar production 14 14
Soybean processing n/m n/m
Cattle farming 2 2
by source
Absorption fields 14 14
Nitrogen emissions from manure management 2 2
Nitrogen emissions from manure application to soil 2 1
Nitrogen emissions from application of synthetic fertilizers 6 6
* restated
Astarta uses the GHG Protocol to calculate GHG emissions
from stationary and mobile sources. Emissions from cattle
farming, manure management, application of manure
and synthetic fertilizers are calculated according to the
Estimating Greenhouse Gas Emissions in Agriculture by FAO.
Scope 2 emissions are based on Ukrainian methodology
and grid emissions factors from the Harmonized IFI Default
Grid Factors 2021 v3.1 and the Harmonized IFI Default Grid
Factors 2018 v2.4. The global warming potential used in
the calculations is based on the IPCC’s Fifth Assessment
Report, 2014 (AR5). 2020 was determined as the base year.
Also, the Company submits GHG emissions from stationary
sources under the national law using the local methodology
“The list of emissions indicators (specific emissions) of
pollutants into the atmosphere by various industries” which
differs from GHG protocol.
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OTHER EMISSIONS
The other significant emissions come from stationary
sources such as boilers, grain dryers, limestone kilns and
include particulate matters (PM), nitrogen oxides (NO
X
),
sulphur dioxide (SO
X
) and others. To reduce negative impact
the Company captures dust and gas with specialized
equipment. Astarta also complies with all relevant national
legislation, obtains corresponding permits and monitors
emissions not to exceed set concentration limits.
Significant air emissions, t 2021
NO
x
293
SO
x
169
Volatile organic compounds and CH4
1 124
Particulate matter 227
Other significant air emissions 1 369
Total 3 182
ACTING ON CLIMATE CHANGE
Land use and land use change in the largest component of
climate mitigation after energy and industry. It is estimated
that 25%-30% of total human-related emissions come from
agriculture, forestry and other land use (AFOLU). Agriculture
occupies c.40% of global ice-free land, uses 75%-84% of
global consumption of water and, among others, causes the
biodiversity loss at the highest rate in history. Conventional
agricultural methods also mean that up to 50% of synthetic
fertilisers are not delivered to plants but sunk into the surface
and groundwater or emitted into atmosphere contributing to
the temperature rise.
Scientists call for taking out 10%-30% of land out of
agricultural production for ecological conservation and, if
done via reforestation, the decarbonisation would be an
additional benefit. Water and fertilizer use can be reduced
via precise application and soil analysis, recycling of at least
50% of nutrients (manure, sewage, food processing waste).
There is a need to increase efficiency of water use by drip
irrigation, recirculation in greenhouses on top of buffering
of water resources in lakes and aquifers, and in soil
through increasing organic matter content. Farmers need
to change crop rotation by switching to crops with lower
water needs in water scarce regions and develop circular
farming business model.
Agriculture has a large potential to sequester carbon in plant
biomass and in the soil. Worldwide soil contains 2,000-
2,500Gt of carbon, which is 3X as much as all plants and 2X
the amount of carbon in atmosphere. Agricultural soils have
potential to sequester up to 2.5Gt of CO
2
per annum and
achieve more than 60% of CO
2
sequestration targets for the
Net Zero target according to IPPC.
There are two main ways for increasing soil organic carbon
(SOC) in soils and its storage:
• increase carbon-reach inputs (crop residues, compost,
manure)
• reduce decomposition rate of organic matter and soil
carbon losses due to erosion (reduced tillage, crop
diversity, erosion management).
It is estimated that agricultural soils lost 30%-75% of original
SOC due to conventional farming practices. The process of
reaching a new SOC stock takes 10-50 years. Agricultural
practices for sequestering carbon in the soil and biomass
is called “carbon farming”. The main additional benefit of
these practices is enhanced soil health and plant resilience
to withstand different weather patterns.
As one of the largest agricultural producers in Ukraine,
Astarta is actively studying and utilising the elements of
carbon and regenerative farming across its farmlands.
In 2021 Astarta further expanded the scale of precision
farming aided by an in-house soil analysis laboratory.
Today, the company has a unique database with a tight grid
covering most of the fields under operational management.
All key soil nutrients are regularly collected and monitored,
and this information is used for adjusting the agronomy to
the physical chemistry of the soil.
By way of example, Differentiated Sowing and S-Control
Monopile techniques tailor the amount of planting material
to the specific land plot and allow increasing productivity of
crops while saving on seeds. At the same time, the remote
monitoring of the crop growth process via AgriChain Scout
(one of the key modules of AgriChain, Astarta’s proprietary
IT software system) increased from ¾ of the operating land
area in 2020 to 100% last year.
The increase in the average annual temperature and lower
precipitation levels in Ukraine command a gradual change
of crop mix towards a higher share of winter crops such as
wheat and rapeseeds total acreage increase from 49kha in
2020 to 54kha in 2021, focus on drought resistant varieties
of spring crops, applying reduced tillage to preserve moisture
in the ground, tailoring density of sowing and fertiliser
application to specific soil conditions.
Another area of expansion for Astarta under changing climate
conditions is irrigation. Currently, 500ha of land operated
by the Company is under irrigation, and there is potential to
increase the scale several-fold in the next few years.
Agricultural science links climate risk mitigation to
sequestration of carbon in soil and, at the same time,
improving its health and productivity. In 2021 Astarta joined
a project by Syngenta, one of the leading global providers of
agricultural science and technology aimed at reduction of
GHG emissions via applying the Cool Farm Tool.
The aim of the project is to identify methods to decarbonise
Astarta’s primary agricultural activities such as crop growing.
The pilot area covers over 30kha of farmland operations and
the data was used to generate the Baseline 2020 report with
the help of the Cool Farm tool. Some of the ‘carbon farming’
methods Astarta has already put into practice, and the
project will allow to achieve verifiable carbon sequestration.
The key areas of focus in ‘carbon farming’ and improving
soil health are soil management (reduced till or no till
combined with preservation of plant residue), growing cover
crops to avoid bare soil, reduced use of nitrogen fertilisers
(application by injection or with nitrification inhibitors).
Astarta practised reduced (minimal and subsoil) tillage at
110kha of farmland in 2021.
Decarbonisation of the industrial processes of Astarta’s
business has been long established via reduction of
natural gas consumption at the sugar mills under the
energy efficiency programme of BAT (best available
technology) and introduction of the bioenergy feed
(pellets) at one of the sugar mills. In addition, Astarta
is planning to ramp up biogas production at the plant
which converts sugar beet pulp into gas to replace half
of annual natural gas needs of the sugar mill and the
soybean crusher in Globyno.
In 2021 Astarta also joined a global community of 13,000
largest companies reporting under the carbon disclosure
project (CDP) about its activities aimed at climate change
adaptation and mitigation.
At the beginning of 2022 Astarta entered into a tri-
party agreement with the EBRD and E&Y to develop a
comprehensive system of ‘climate corporate governance’
covering GHG methodology for Scope 1-3, scenario analysis
for 1.5ºС-4ºС growth in global temperature, identifying
physical and transitional climate risks, analysis of existing
and prospective decarbonisation initiatives in crop and
dairy farming, food-processing, setting short- and long-term
GHG reduction targets (SBTi). The project aims to develop
a detailed roadmap to allow Astarta adapt its business
segments to climate change while mitigating own impact on
the environment.
WATER
WITHDRAWAL
AND DISCHARGE
Water is the most widespread resource on the planet,
nevertheless only 2.5% of its total is suitable for human
consumption. According to FAO agriculture is the largest water
user, accounting for 70 percent of total freshwater withdrawals
on average. Ukraine is among the countries with insufficient
access to freshwater resources which is especially noticeable
in its southern regions in need for irrigation.
Astarta’s business operations are in the central and western
regions with higher levels of precipitation and availability of
water resources. Yet, responsible consumption of water is
among key priorities for the Company.
Astarta withdraws fresh water from surface and underground
sources according to limits and permits from local authorities.
All water intake points are equipped with water meters.
From 2021 Astarta calculates water withdrawal and
discharge in the Agriculture and Cattle Farming segments
separately. In the Agriculture segment water is mainly used
in irrigation and application of plant protection products,
and general household needs. Total water withdrawal by the
Agriculture segment was 1,052 megalitres in 2001.
The discharged water is mainly wastewater collected in
special reservoirs for further discharging and treatment
by specialist organisations. Total water discharge by the
Agriculture segment was 2 megalitres.
In the Sugar Production water is used for washing sugar
beets and for cooling power stations at sugar mills. Sugar
plants have different categories of water used in sugar beet
processing. The First category of water is technical water
from a water reservoir, the Second category of water is clean
water used for sugar beets washing and their transportation
along the conveyor belt. The Third category of water is
wastewater that contains sludge from the technological
process. The latter category of water is not returned to the
production cycle but discharged to the absorption fields next
to the sugar plants for biologic treatment of wastewater.
In 2021 water withdrawal by the Sugar Production segment
increased by 55% y-o-y to 2,120 megalitres due to raw
cane sugar processing, while water discharge was 1,970
megalitres (up by 57% y-o-y).
The Soybean Processing segment withdraws relatively
small amount of water. In 2021 the soybean processing
operations withdrew 128 megalitres (down by 16 % y-o-y).
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Like sugar operations wastewater is discharged to the absorption fields. In 2021 wastewater discharged by the segment was
46 megalitres (down by 11 % y-o-y).
Cattle Farming operations withdraw water mainly for watering the animals and washing milking equipment. In 2021 water
withdrawal by the segment was 652 megalitres while water discharge totalled 521 megalitres.
ANIMAL
WELFARE
Astarta is committed to the humane treatment of animals
and prioritizes improvement in animal health and welfare.
The Company’s livestock management team continuously
seeks feedback from experts on animal health and welfare
to align to science-based practices. Advice from specialist
business partners is available for each employee to
enhance their knowledge and improve professional skills.
Online training for farm staff is provided in veterinary care
and treatment, feeding, calf care, planning and accounting
in animal husbandry, etc.
Astarta ensures good living conditions for animals in the
cowshed and during the outdoor grazing. In the cowshed,
cows have thick mattresses, sufficient room to move and
walk around, massage brushes, constant access to clean
drinking water, balanced and timely feed.
The welfare standards are raised for their animal comfort.
In 2021 specific improvements included: reconstruction of
two cowsheds for 400 heads and construction of cubicle
housing for 400 calvers, heifers and calves, overhaul of
summer cowsheds with milking stalls, 800 stalls equipped
with special comfortable bedding, four farms equipped with
modern ventilation systems, construction of fodder storage
facilities and new hay and forage harvesting equipment.
The Company’s automated ProFeed animal feeding system
became operational at nine farms out of 42. Astarta
continuously adjusts its feed safety system via systematic
analysis of in-house and purchased ingredients. All feed
components are tested for quality and safety before use.
Further operational improvements concern implementation
of HACCP (Hazard Analysis and Critical Control Points)
activities plan at all dairy farms. Within the framework of
in-house operational efficiency programme 83 ideas in
livestock breeding were generated and three projects were
implemented on their basis in 2021 resulting in EUR102k
savings. The Company’s livestock managers seek practices
that enhance animal well-being and productivity, especially
those that reduce stress and increase yields. Special cattle
exercises were piloted at one of Astarta’s dairy farms.
Improvements of animal welfare are also promoted by
developing standardized procedures, instructions and
checklists for precise and coordinated actions for livestock
care personnel. These include HACCP and animal welfare
information posters at all dairy farms, description and
visualization of milking technology and instructions for
selecting heifers.
One of Astarta’s dairy farms participated in a pilot
digitization project on implementation of the Raw Milk
Control Programme based on the specialist Milk Module
software. The programme’s objective is to increase value
added in domestic trade from the dairy sector for the
common goal of sustainable growth in Ukraine. The project
is realized by the State Food and Consumer Service within
the framework of the Quality FOOD Trade Programme,
funded by the Swiss State Secretariat for Economic Affairs
(SECO), under the leadership of the Research Institute
of Organic Agriculture (FiBL) in Switzerland together with
SAFOSO, a Swiss consultancy advocating safe food from
healthy animals.
The Company’s recently renewed whistleblower policy allows
its employees to report any suspected incidents of abuse,
neglect or improper animal handling practices.
The main risk facing the Company on the animal welfare
front is climate change, affecting feed quality and animal
health in summer season. To minimize it livestock managers
constantly review feed diets and seek suitable alternatives
and ventilation systems are installed to prevent heat stress.
The risk of rising feed prices dictates constant revision of
procurement of ingredients. Since the developments in the
field of animal health and welfare are constantly evolving,
new approaches and practices will be considered in the
years to come.
To control the quality of discharged wastewater Astarta performs a specialized analysis on a quarterly and annually basis.
Water withdrawal
ML All areas
Areas with
water stress*
Water withdrawal by
source
Surface water 2 704 706
Groundwater 1 230 257
Third-party water 28 11
Total water withdrawal Surface water (total) + groundwater (total) + third-party water (total) 3 962 974
Water discharge
ML All areas
Areas with
water stress*
Water discharge by destination
Surface water** 237 237
Absorption fields 1 972 558
Third-party water 549 151
Total water discharge Surface water + absorption fields + third-party water (total) 2 758 947
Water discharge by freshwater
and other water
Freshwater - -
Other water 2 758 947
Water consumption
ML All areas
Water consumption Total water consumption 1 204
Facilities in areas with water stress*
ML
Zhdanivsky
sugar plant
Narkevytsky
sugar plant
Viytovetsky
grain silo
Khmilnytsky
grain silo
Krasylivsky
grain silo
Water
withdrawal
Surface water 360 343 - - -
Ground water 3 0.6 0.7 1.2 0.9
Third-party - 11 - - -
Water consumption 3 12 1 1 1
* Water stress areas are defined according to Water Risk Atlas
** Second category water
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LAND USE AND
BIODIVERSITY
Biodiversity is the variety of life on earth such as animals,
plants, fungi as well as microorganisms. Due to increasing
pressure from human activities through consuming
resources in the amounts never seen before the world
faces the risks of losing the biodiversity which is a base for
a balanced nature ecosystem. Continuous intensification of
land-use in agriculture to meet the demand for food from
the growing population caused significant reduction in
biodiversity. According to WWF three-quarters of the land-
based environment have been significantly altered, more
than a third of the world’s land surface is devoted to crop or
livestock production. Thus, the protection and conservation
of biological diversity, the maintenance of ecosystem and the
balanced management of living natural and land resources
are fundamental to sustainable development.
Ukraine has a significant biodiversity potential. According to
national experts Ukraine is home to more than 70k animals
and plants species which represents 35% of the estimated
European biodiversity. Given the size of its farmland bank and
agricultural crops’ business Astarta pays special attention to
sustainable land use and protection of biodiversity across
its geography of operations.
Management approach to land use and biodiversity is based
on the corresponding policies and standards developed
according to national and international requirements and
voluntary initiatives such as the concept of the national
programme for biodiversity conservation, the IFC and EBRD
standards, the Convention on Biological Diversity, the
Ramsar Convention etc.
Astarta implemented the following key standards, policies
and procedures in the sphere of land use and biodiversity:
the Sustainability Policy, the Environmental Policy, the
Sustainable Agriculture Policy, the Deforestation Policy, the
Biodiversity Corporate Standard.
Basing on the above-mentioned documents management of
the Company is committed to:
• assesses the potential effects, cumulative, direct and
indirect impacts of any new or reconstruction project on
biodiversity;
• use the components of biological diversity in such a
way and at a speed that does not lead to its long-term
reduction;
• abide by the principle of avoiding the impact on
biodiversity and minimization of potential impact;
• keep the Company’s operating activities out of protected
areas, such as nature reserves;
• introduce modern regenerative farming practices;
• use species that are naturally adapted to local and regional
ecosystem for higher resistance to pests and diseases;
• implement best practices for sustainable management
of living organisms.
One of the key elements of preserving the biodiversity and
land resources in farming operations is the reduced or
no-till approach as the depth of tillage is linked to the soil
degradation and change in biodiversity. Such regenerative
farming practices contribute to the protection and restoration
of biodiversity as it assumes minimal mechanical treatment
of the soil. In 2021 the Company performed minimal and
subsoil tillage on almost 110kha.
Another important element of regenerative farming is use
of cover crops and reduction in use of nitrogen fertilizers
by applying nitrification inhibitors. These protects soil from
erosion, therefore improving its health. In 2021 Astarta used
cover crops and nitrification inhibitors on the area of 0.5kha.
Astarta continuously invests in upgrading of its agricultural
machinery fleet. To this end, in 2019 Astarta announced a
five-year programme of renewal of agricultural machinery. Use
of modern equipment results in lower impact on soil during
the farming operations through more precise operations and
inputs application and reduction in energy use.
Astarta actively uses digital solutions for land management
such as proprietary IT software called AgriChain developed
by its in-house agritech subsidiary. In 2021 the AgriChain
Land module was updated with additional elements such as
those allowing to monitor and control location of land plots
operated by the Company in relation to the nature reserve
areas. Astarta can make a fast verification whether a land plot
which is considered for potential lease belongs to such areas.
There are also other elements of digitalisation and precision
farming operations such as Differentiated Sowing and
S-Control Monopile techniques which allow to reduce
seeds application and improve productivity while mitigating
negative impact on soil.
In the context of supply chain management when purchasing
raw materials and products from suppliers, Astarta considers
their location and checks whether there is a significant risk the
habitat of species. If such risk is identified the Company does
not enter into contractual relationships with such suppliers.
Raw materials such as soybeans and sugar beets supplied
to the Company’s processing assets are grown in-house or
by local farmers. Neither Astarta’s agricultural subsidiaries
engaged in raw materials and milk production, nor local
farmers use deforested land or involved in any kind of
deforestation activities.
According to the biodiversity risk assessment results, there
are no high-level risks for biodiversity from activities in the
regions of Astarta’s presence.
HUMAN CAPITAL
Astarta believes that people are the most vulnerable and
valuable capital of the company. The Company use a
partnership approach in relation to its employees and aims
at creating favourable climate, so that everyone can fully
discover and realise their potential, including development
of leadership skills.
Such partnership approach positioned Astarta among the
best employers in Ukraine, which is by various ratings:
• for the second year in a row business magazine “Delo”
recognised Astarta among the five best employers in
Ukraine and gave the “Best Employer Brand” award on
the basis of excellent reputation, social responsibility,
personnel development;
• business magazine “Focus” rated Astarta among the
best three employers in the Agrosector category;
• Astarta was also awarded a status of an ACCA (the
“Association of Chartered Certified Accountants”)
Approved Employer becoming the only Ukrainian
agricultural company which obtained such status.
Astarta’s top priority is the health and safety of its
employees and their families during COVID-19 pandemic
development. In 2021 management kept daily health
records of employees and their families, supported during
illness and rehabilitation, provided vitamins paid by the
Company. Astarta also continued to support hospitals in the
regions of its presence by providing the required supplies
and organising training for medical staff.
To support the mental health of its employees during the
pandemic, Astarta launched the programme called “Well-
being: improving health at the workplace” run by a qualified
expert and supported by online consultations.
The Company also secured an access to distance learning
and supported professional development of its employees in
the pandemic conditions.
To further support the team spirit, Astarta has increased
the number of channels for internal communication and
activities for cross-functional co-operation to prevent
psychological burnout and increase efficiency of information
exchange within the Company.
ASTARTA’S ACTION PLAN
Astarta developed a dedicated human capital action plan
to support development and meet its strategic business
goals. The action plan covers 2022-2024 and considers
recent changes in the country, key trends in the Ukrainian
employment market and key HR risks.
EMPLOYEES ENGAGEMENT
Astarta’s relations with its employees are guided by
corresponding legislation and internal policies such as the
Human Rights Policy, the Social Policy and the Remuneration
Policy which envisage creating conditions, opportunities and
incentives to stimulate engagement of employees.
The Company implemented the following internal projects to
promote employees’ engagement:
1. The Operational Improvement System of Astarta
(OISA). This is a management system designed
for creation of perfect business processes and the
involvement of each employee in the process of
continuous improvement.
Since its launch the economic benefits have totalled
UAH28m. Almost 900 employees participated in the
programme, i.e. nearly 14% of the total headcount. On
average UAH32k of economic benefit was achieved per
Internal
coaching
Leadership
skills
development
Cross-
functional
education
Promotion
of business
ethics
Students
involvement
Training
programmes
System of
transformation
agents
COMPONENTS
OF THE ACTION
PLAN
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BENEFITS PROVIDED TO EMPLOYEES
To create comfortable working conditions and stimuluses,
the Company provides the following benefits for the
employees:
• Financial incentives. One-time financial assistance,
Reimbursable financial assistance (loans)
• Medical insurance and services. Preventive medical
examination for the employees with harmful working
conditions, voluntary medical insurance or wellness
programmes; measures against COVID-19
• Working and living conditions. Assistance in improving
housing conditions for the key employees, professional
development and training; transportation services
including personal cars for key employees, mobile
telephony
• Other. Additional paid leave, nomination of the best
employees for corporate and state awards.
PARENTAL LEAVE
Astarta respects the right of the employees to parental
leave which is secured in corresponding legislation and
internal policies of the Company. In 2021 196 employees
were entitled to parental leave. 165 employees exercised
their right of parental leave, 163 of which were female.
53 employees (all female) discontinued parental leave, of
which 17 returned to work (all female). Return to-work and
retention ratios were 32% and 89% correspondingly.
Number of employees
2020 2021
Right to parental leave 202 196
Female 200 194
Male 2 2
Exercised the right to parental leave, incl. 202 165
Female 199 163
Male 3 2
Discontinued parental leave, incl. 59 53
Female 58 53
Male 1 -
Returned to work 18 17
Female 17 17
Male 1 -
Still employed 12 months after return
to work
n/a 16
Female n/a 15
Male n/a 1
Return to work rate, % 0 0
Female 29% 32%
Male 2% -
Retention rate, % n/a 89%
Female n/a 88%
Male n/a 100%
MINIMUM NOTICE PERIODS REGARDING
OPERATIONAL CHANGES
Astarta abides by the requirements of corresponding
national legislation in relation to minimum notice periods
prior to operational changes.
In case the Company plans operational changes that can
impact labour conditions of employees, it notifies the affected
individuals or their representative two months before the
planned changes. If an employee works for a subsidiary of
the Company with a trade union, the notification is made
three months before the planned changes.
There is also a minimum notice period set by the collective
agreements. According to a standard agreement the minimum
notice period is two months before the planned changes.
participant of the OISA. Over two years more than 2,100
ideas were submitted in all segments of the Company’s
business and 31 operational improvement projects
had been implemented. Fourteen “kaizen projects” are
currently in the process of realisation. The Company paid
UAH2.5m in bonuses to the authors of ideas and the
implementation teams.
2. Staff reserve. The project aims to identify talented
employees with potential leadership skills. Having
selected such employees, the Company conducts
special training to create a talent pool for potential
senior positions.
3. Think Tank. The project’s goal is to collect ideas on
efficiency improvements from the Company’s employees.
This allows to identify creative and motivated individuals
who are ready to take leadership role in transformation
processes within the business and, at the same time,
stimulate engagement of other employees.
4. School of Internal Experts. The key purpose of the
project is to share knowledge and successful experience
within the Company by providing opportunities for self-
realisation of employees.
As a big agroindustrial holding Astarta seeks ways to increase
the popularity of the agriculture as an industry for building a
career for young people. With this purpose Astarta launched
an educational career guidance project “My Future in Agro”
in different regions of Ukraine.
EMPLOYMENT
Astarta conducts its business nationwide, thus hiring people
in different regions of Ukraine.
As of the end of 2021 the total number of employees was
4,820. A 4% decline is explained by the higher labour
productivity in the agricultural segment, the share of which
came down from 50% to 46% of the total. The breakdown
of employees by gender, age, professional level, and type
remained stable.
Number of employees
as of YE 2019 2020 2021
Age 5 470 5 027 4 820
up to 30 y.o. 824 710 618
15% 14% 13%
30-50 y.o. 3 025 2 760 2 696
55% 55% 56%
over 50 y.o 1 621 1 557 1 506
30% 31% 31%
Gender 5 470 5 027 4 820
male 3 458 3 211 3 077
63% 64% 64%
female 2 012 1 816 1 743
37% 36% 36%
Level 5 470 5 027 4 820
managers 790 667 641
14% 13% 13%
specialists 1 285 1 248 1 272
24% 25% 26%
workers 3 236 2 967 2 769
59% 59% 58%
other employees 159 145 138
3% 3% 3%
Segment 5 470 5 027 4 820
agriculture 2 524 2 515 2 214
46% 50% 46%
sugar production 1 073 711 729
20% 14% 15%
soybean processing 204 202 195
4% 4% 4%
cattle farming 1 246 1 177 1 191
23% 24% 25%
other 423 422 491
7% 8% 10%
Type 5 470 5 027 4 820
permanent 4 566 4 250 4 046
83% 85% 84%
seasonal 904 777 774
17% 15% 16%
The gender gap is due to the nature of agricultural operations.
The level of staff turnover cannot be measured precisely due
to the specifics of the business – i.e. each business segment
has different start and end dates, as well as different use of
seasonal workforce.
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OCCUPATIONAL
HEALTH AND
SAFETY
Astarta’s occupational and health safety system is based on
the Integrated Corporate Management system and a risk-
oriented approach according to requirements of national
legislation and international standards such as the Ukrainian
Law on Labour Safety and the ISO 45001 standard. Key
production managers and specialists are engaged into the
system improvement through the assessment of the system
meeting current legal requirements. The system covers all
production-related employees as well as contractors.
Identification of risks related to occupational safety and health,
and road safety is based on the internal Standard called “Risk
Identification and Assessment”. The identification of relevant
risks is performed through an analysis of the technological
processes, parameters and technical characteristics of the
equipment (substances) used, inspection at all stages of the
production processes for deviations from set parameters and
the analysis of the impact of these deviations on the reliability
of the technological processes.
Accidents are entered into the internal monitoring system
to be investigated according to the internal Standard called
“Incidents” and to prevent personnel injury and fatalities in
the future. Responsible employees distribute information
indicating the reasons for incidents and actions taken. All
measures in relation to avoidance of incidence are also
discussed by management of the Company monthly. The
internal procedures on occupational health and safety are
revised annually for improvement.
Astarta constantly conducts training and knowledge testing
on health and safety issues under the internal Standard
“Education and Expertise”. In 2021 2,610 employees (one
employee can participate in several trainings) took part in the
training on health and safety including following key topics:
fire safety, electrical safety, road traffic safety, hazardous
chemicals, incidents investigation, high risk works.
The Company makes every effort to prevent occupational health
and safety risks arising from technological processes through:
• taking preventive and safety actions including
replacement or elimination of hazardous conditions or
substances;
• provision of the necessary equipment and equipment to
minimise risk;
• professional training for employees and implementation
of appropriate incentives to adhere procedure on labour
protection and safe use of equipment;
• dissemination of information on incidents;
• measures to prevent specific emergencies and training
on actions in case of such emergencies.
There is health and safety induction conducted for visitors
including contractors and employees before starting the
work or visiting the facilities.
There are small medical surgeries at some production
facilities where employees can get first medical aid
and some basic health care procedures. In response to
COVID-19 Astarta provided cleaning and sanitizing means
for use by its employees. The Company also conducts
intensive communication and education to promote disease
prevention among employees.
All Astarta’s key production assets such as sugar plants,
soybean crusher and grain silos have been certified
under ISO 45001 – the Occupational health and safety
management systems.
Work-related injuries data
2019 2020 2021
Fatal Injury Frequency Rate
(FIFR)
0.1 0.1 -
Lost Time Injury Frequency
Rate (LTIFR)
0.4 0.2 0.5
Lost Day Rate (LDR) 55.3 6.0 18.3
TRAINING
Management approach to training is based on the internal
documents that define common rules and requirements.
Each employee has a right to improve professional skills via
training and can make a corresponding application through
defined internal procedures.
The Company identifies following types and forms of training:
long-term and short-term, external and internal.
• Long-term training is provided on the basis of higher
education institutions to obtain tertiary qualification or
in lyceums to master a new trade;
• Short-term training is targeted at an in-depth study of
a particular area of activity, including modernization,
reorientation or restructuring of business units,
significant changes in the regulatory framework
governing its activities, training on best available
technologies;
• Internal training is conducted by in-house personnel;
• External training is conducted by third-party service
providers.
Development of corporate skills is carried out through
trainings, master classes, seminars, conferences, forums,
business games, etc.
After the training the Human Resources Department
conducts appraisal of the level of acquired knowledge and
skills as well as overall quality of the training.
Astarta focuses on the professional development of its
employees and implements various projects that help to
reveal and realize their potential. To this end, the Company
implemented the following programmes:
• Mentoring targeted at building an effective team;
• School of Internal Experts to share knowledge and
successful experience within the Company by providing
opportunities for self-realisation of employees;
• Astarta Managers’ Development programme to develop
professional skills of the key managers.
In 2021, annual weighted average number of training hours
per employee in 2021 was 11 hours, including:
By level:
• managers – 9 hours;
• specialists – 11 hours;
• workers – 11 hours.
By gender:
• male - 10 hours;
• female – 12 hours.
Training included educational courses in the Head Office,
subsidiaries, and dedicated educational centres. Employees
also took part in specialised conferences, forums, trade
shows. Key training topics included:
• professional training (training for the new employees,
additional training in the employee’s specialty);
• development of personal and managerial skills;
• occupational health and safety, fire safety etc;
• environmental issues and product quality.
Total spending on training was EUR0.2m in 2021 vs
EUR0.1m in 2020.
PERSONNEL ASSESSMENT
Personnel assessment is a set of the appraisal activities
which involve all employees of the Head Office as well as
directors and managers of the subsidiaries. The assessment
includes four key components:
The assessment is based on annual appraisal of the results
of the employee according to previously set KPIs and
professional skills development. Such assessment is a good
stimulus for motivation of the employees. It allows to focus
on efficiency improvement and development of personal
professional skills to meet the required targets.
In 2021 Astarta initiated an ideas
contest on health and safety issues.
The contest generated 104 ideas for
improving health and safety in the
technological processes. 18 ideas were
recognized as the best ones with a
corresponding reward to its authors.
Performance assessment (KPI)
Skill level assesment
Development plans
Identification of objectives for the next year
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The process of assessment consists of four stages:
Self-assessment –employees
assess individual results
for the year according
to previously set KPIs by
themselves, prepare plan
for the next year and create
professional development
plan
Assessment interviews –
managers conduct interview
with their team members
to assess results for the
year, level of professional
development, adjust the
plans for the following years
Assessment approval –the
results of the assessment
are approved by the top
managers
Assessment finalisation
–the assessment results
and plans for the next
year are incorporated into
corresponding documents
aligned with the Company’s
values and targets
The results of the assessment are translated into an annual bonus based on the annual KPIs performance. Annual bonuses
as well as other financial incentives are set by the Remuneration Committee.
DIVERSITY
AND EQUAL
OPPORTUNITIES
Astarta treats people with dignity and respect, provides
necessary conditions and creates working environment
where human rights are respected. Astarta is not involved in
any activities that directly or indirectly violate human rights.
The Company does not tolerate contempt or inappropriate
destructive behaviour, revenge, unfair treatment.
Astarta values diversity of its employees and is committed
to providing equal opportunities and does not accept any
form of discrimination or harassment. The Company does
the utmost to ensure that its workplaces is free from
discrimination or harassment on the grounds of race,
gender, colour, national, ethnic or social origin, religion, age,
special needs, sexual orientation, political views or any other
status protected by law and internal policies.
The basis for the selection of candidates for employment,
recruitment, employment, training, remuneration and career
growth in the Company is qualification, skills and experience.
The Company does not have a formal Diversity Policy.
However, in 2007 it has adopted the Rules of the Board of
Directors, which include the Profile of the Board of Directors,
Resignation schedule for the members of the Board and
other documents regulating the Board’s composition,
decision-making process, working mode, allocation of
powers and general functioning.
The Board of Directors of Astarta consists only of men.
Effective corporate governance is very much dependent on
the skills and experience of members of the Board, Executive
and Non-Executive Directors as members of the Board are
selected only based on qualifications, abilities (including
reputation and integrity) but not gender. When there is a
vacancy at the Board of Directors, the Company will strive to
promote gender diversity by trying to engage women to join
the Board of Directors.
BREAKDOWN OF EMPLOYEES BY DIVERSITY
CATEGORIES:
By gender:
• male - 64%;
• female – 36%.
By age:
• up to 30 y.o. – 13%;
• 30-50 y.o. – 56%;
• over 50 y.o. – 31%.
Ratio of basic salary and remuneration
of women to men
2019 2020 2021
Total, including: 90% 97% 97%
managers 67% 69% 75%
specialists 106% 109% 98%
workers 85% 93% 91%
other employees 79% 76% 82%
In 2021 767 employees or 12% of the annual average number of employees passed an annual assessment including:
By level:
• managers – 142 employees or 27% of the average number of managers;
• specialists – 369 employees or 34% of the average number of specialists;
• workers – 256 employees or 6% of the average of workers.
By gender:
• male - 598 employees or 14% of the total number of male employees;
• female – 169 employees or 8% of the total number of female employees.
Self-
assessment
Assessment
interviews
Assessment
approval
Assessment
finalisation
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FREEDOM OF
ASSOCIATION
AND COLLECTIVE
BARGAINING
The Company’s approach to the freedom of associations and
collective bargaining is based on the national legislation.
Astarta’s collective agreement clearly states prevention of
any direct or indirect limitation of any rights, no direct or
indirect privileges related to the membership in trade unions
or any other association of people. The agreement also
includes guarantees for freedom of association, functioning
of primary trade union organisation, civic organisation. In
addition, the Company is committed to:
• during non-working hours to provide employees space for
holding of general meetings (conferences) of employees
including necessary equipment, communications,
heating, lighting, cleaning, transport, security;
• providing an opportunity to visit and inspect workplaces
for the trade union committee;
• provide to the trade union committee an opportunity
to access relevant documentation, information
and explanations concerning the conditions and
remuneration, the implementation of collective
agreements, compliance with labour legislation and
socio-economic rights of workers;
• provide an opportunity to directly address the employer
and officials of the Company on the issues that are the
subject of the collective agreement;
• provide an opportunity to inspect the social infrastructure
facilities owned by the Company;
• provide the opportunity to publish information by
employees in agreed upon places;
• transfer 0.3 percent of the payroll to the fund of the
primary trade union organisation to promote cultural
and health-related activities;
• abstain from actions that can interfere with work of the
primary trade union organisation.
In 2021 there were no disputes between the Company and
the trade unions.
As of the end of 2021 99% of Astarta’s employees were part
of the collective agreement.
HUMAN RIGHTS
Astarta is guided by an internal Human Rights Policy
based on best international practices defined in the Global
Declaration of Human Rights and UN Global Compact. The
policy is available and promoted at all production facilities of
the Company via information boards and HR departments.
In 2021 the Human Rights Policy was updated. The Code
of Corporate Ethics also defines the basic principles of the
Company’s culture: openness, tolerance, respect.
In 2021 64 employees completed a dedicated training programme
on protection of human rights and prevention of discrimination.
Educational resources on the topic were also distributed through
the corporate knowledge base, including recommendations on
preventing and counteraction of discrimination, links to video
courses and training materials were published at the corporate
resources. The training also addressed issues of gender equality,
ethics, prevention of harassment and abuse. Testing was
conducted at the end of training.
Astarta respects human rights and does not discriminate on
political, religious, ethnical, gender, sexual or other grounds.
The Company provides equal opportunities in employment,
professional and personal growth to all employees.
The Company guarantees safety at workplace. There is a
Corporate Integrated Management System in place, the
mandatory component of which is employee’s health and
occupational safety. All production facilities were assessed
internally for occupational health and safety risks.
The Ukrainian law prohibits the use of child and forced
labour. No person under the age of 18 works at the
production facilities and there were no cases of forced
labour at Astarta. The Company treats these issues as a
matter of principle and strictly adheres to the rule of the law.
When making economic decisions, the Company always
considers and assesses potential risks to human rights.
Potential cases of human rights violations can be reported
to the local management team via a dedicated hotline. The
procedure for handling complaints and appeals is described
in the Stakeholder Engagement Plan.
Astarta performs a regular internal audit to verify compliance
with the Human Rights Policy. All of the Companies
subsidiaries are covered by the audits. The internal audit
confirmed that there were no violations of human rights at
the Company’s business units in 2021.
The policy is also shared by contractors and subcontractors,
who work with the Company. Monitoring of potential use of
forced and child labour is also included into the Sustainable
Development Questionnaire for suppliers, which is filled out by
them and submitted as part of procurement tenders by Astarta.
CERTIFICATION
AND
SUSTAINABLE
PRODUCTS AND
SERVICES
Astarta aims to run its production in the most efficient
way in terms of economic-soundness and sustainability
which implies earning profits while minimizing negative
environmental impact, conserving natural resources and
developing communities as well as ensuring high product
quality and safety.
In 2001 the Company’s crop growing subsidiary List-Ruchki
confirmed the status of an organic producer and successfully
passed the certification of land and warehouses by the
Organic Standard and Bio Suisse. Certification allows the
Company to sell its organic products to the European Union.
In the reporting period Astarta allocated 1.8kha for organic
farming and produced more than 4kt of organic wheat, corn,
soybeans and other crops.
The Company’s proprietary IT software AgriChain together
with other digital solutions allow improving operational
processes and add to the overall efficiency of the business
in terms of economic return and sustainability. These
solutions include farmland management, field operations,
storage, purchase and supply processes, crop monitoring,
agrochemical field profile, meteorological data and plant
vegetation status (NDVI). As a result, Astarta improves
productivity while reducing use of inputs such as fertilizers,
seeds, fuel etc.
Carbon farming was one of the key sustainability topics
analysed by the Company in 2021. Astarta joined a
regenerative agriculture project of Syngenta, LLC (Ukraine) to
develop farming practices for sequestering carbon in the soil
and enhance its health. The Company developed a Baseline
report for 2020 and received a set of recommendations to
decarbonise its field operations through reduced tillage,
cover cropping, use of emission inhibitors and lower
consumption of fertilisers and energy.
Astarta intends to follow the recommendations and reduce
its carbon footprint over several years. The reduction will
be measured by the Cool Farm Tool. After independent
verification the Company plans to create Voluntary Carbon
Credits for sale.
Some of the elements of carbon farming had already been
used by the Company in crops production, for example
subsoil and minimal tillage. In 2021 the Company performed
minimal tillage and subsoil tillage on almost 110kha and
expects to increase such practices to 145kt in 2022.
Another important element of regenerative farming is use
of cover crops and reduction in use of nitrogen fertilizers by
applying nitrification inhibitors. In 2021 Astarta used cover
crops and nitrification inhibitors on the area of 0.5kha and
expects to increase it to 5.5kha in 2022.
In 2021 Astarta launched a pilot production of inverted
sugar syrup. Since the inverted syrup’s digestibility is similar
to honey it can be fed to bees in spring and autumn to
increase their productivity. In 2021 Astarta sold pilot 35t of
inverted syrup to local beekeepers and honey producers.
In Sugar production and Soybean processing Astarta uses
biogas from an inhouse biogas facility to replace natural
gas consumption. This biogas facility uses sugar beet pulp,
a residue from sugar production, as a raw material for
biogas production. Therefore, use of biogas not only adds
the sustainability aspect to the business of the Company but
reduces costs amid high energy prices.
One of the key sustainability elements of the Company’s
business is the quality of its products. Astarta developed a
strong system of health and safety measures while producing
high-quality products that correspond to international
standards.
Astarta’s key production assets are certified in accordance
with FSSC, ISO 22000, GMP + and HACCP standards. To
ensure high quality and safety of products, the Company
constantly controls raw materials and other inputs. The main
criteria for quality and safety of raw materials are defined
by national and international regulatory and technological
documents (TU, DSTU, Council of Europe Directives, etc.),
and include among others GMO content, microbiological
indicators, pesticides, radionuclides and others.
Astarta puts special emphasis on the quality and safety of its
milk production. The quality is controlled through fat, protein
and water content, as well as density and freezing point of
the milk. Food safety control includes an assessment of
antibiotics use, cow health, the quality and safety of the feed,
the sanitary and hygienic requirements and the temperature
of the milk cooler tanks.
To strengthen the food safety system, the Company also
monitors risks related to malicious spoilage of food products
and vulnerabilities to falsified food.
In 2021 there were no cases of non-compliance with
regulations on health and safety of products identified.
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COMPLETED AUDITS
Facility ISO 9001
FSSC
22000
ISO
14001
ISO
45001
ISO
50001
ISO
22000
GMP+B2 ISSC+
Organic
standard
Narkevytsky sugar plant ----- ----- -----
Zhdanivsky sugar plant ----- ----- -----
Yareskivsky sugar plant -----
Globynsky sugar plant ----- ----- -----
Novoorzhytsky sugar plant ----- ----- -----
Globynsky processing plant GMP+B2 ----- -----
Viytovetsky grain silo ----- ----- ----- -----
Khmilnytsky grain silo ----- ----- ----- -----
Krasylivsky grain silo ----- ----- ----- -----
Lutovynisky grain silo ----- ----- ----- -----
Semenivsky grain silo ----- ----- ----- -----
Skorokhodivsky grain silo ----- ----- ----- -----
Yareskivsky grain silo ----- ----- ----- -----
Agriculture firm named after
Dovzhenka
----- ----- ----- ----- ----- ----- -----
LLC “Khmilnitsky” ----- ----- ----- ----- ----- ----- -----
LLC “Lysk-Ruchky” ----- ----- ----- ----- ----- ----- -----
Key development
programmes
MY FUTURE IN AGRO
Astarta started the programme in 2018 to introduce
students to modern agriculture and related professions.
Currently 25 schools from different Ukrainian regions take
part in the programme.
The programme includes training courses which consist of
theoretical and practical parts.
The participating schools have dedicated greenhouses,
where students grow plants independently, explore
application of plant protective agents, perform experiments
and write research.
Key results of the programme:
• 800 children completed training;
• 35 children took part in a scientific contest;
• 32 projects were created.
SMART-IMPULSE FOR THE COMMUNITY.
The programme was fostered in partnership with the
Embassy of Switzerland and consulting firm Deloitte in
Ukraine. The authorities of the Volochysk Community began
transformation of their community in close cooperation with
experts in the field of self-governance, economic analysis
and sustainable development.
Key results of the programme:
• A comprehensive community diagnostic was conducted,
40 recommendations were prepared and 11 were
implemented;
• To identify priorities for the community development a
hackathon was organized involving local population;
• Several business projects were implemented.
UPRISE!
“Uprise!” programme stated in 2018 and is aimed at
encouraging rural youth to engage in life of their communities
using leadership skills, project thinking and experience of
undertaking personal projects. The programme is a result
of joint efforts by Astarta, charity “Trust in Yourself” and the
Ukrainian Academy of Leadership (the UAL).
Key results of the programme:
• 688 children completed training on leadership and
project management;
• 160 projects aimed at development of communities
were created;
• 53 ideas implemented.
IT EDUCATION
In 2017 Astarta, in partnership with BrainBasket Foundation
and Miratex company, initiated an ambitious educational
programme “IT Education in Rural Areas” to promote IT
skills to children and adults. The programme has become
a unique opportunity for free learning in rural areas. The
adult course is designed for people over the age of 40 and
is aimed at developing basic IT skills.
The course for children is designed for students aged 9 to 15
years. It is based on visual programming language SCRATCH
(developed by the Massachusetts Institute of Technology).
Key results of the programme
• 1,040 children completed training in SCRATCH and
ROBOTOTECH;
• 673 adults completed training on basic IT skills;
• 400 children took part in IT contests;
• 55 IT projects were created.
DREAMACTIONS 4.0
The programme was implemented by educational platform
CANactions School and regional fund Western NIS
Enterprise Fund in partnership with Astarta. The programme
is designed to support development and transformation
of local communities through providing microgrants and
popularisation of international practices in the sphere of city
planning around Ukraine.
Local communities create and register projects to improve
city-planning across the country. Under the programme
eight projects were chosen for implementation. Among the
chosen were three projects from the local communities in
regions of Astarta’s activities.
LOCAL
COMMUNITIES
Since its foundation, Astarta has been following international
standards and norms of corporate social responsibility and
sustainable development. Creating positive changes in
society is also a challenge for the Company’s business as
its growth is interconnected with the development of the
related communities. Astarta maintains relationships of
mutual respect, responsibility and cooperation in all areas
where it operates. The Company’s partnership with the
communities engages workers, promotes the environmental
enhancement and maintain sustainable supply chains.
Astarta proactively interacts with local communities through
dedicated engagement plans to maximize involvement and
create productive partnerships.
At the management level, the responsibility for engagement
of local communities is assigned to the Director of HR, while
Corporate Partnership and Communications Department is
responsible for coordination. In the regions of operations
the responsibility for interaction with local communities is
assigned to the directors of regional production sites and
relevant social workers.
Astarta also has developed a grievance mechanism for
handling complaints and appeals received from local
communities. Information on the exact procedure is
published on the Company’s website and on the information
stands at production sites.
If there is a new development project/extension or reconstruction
of existing facilities Astarta conducts an assessment of
potential environmental and socio-economic impact on local
communities which is required by national legislation and at
request of international development institutions.
On a permanent basis the Company also identifies priority
areas for local development and sponsors relevant
programmes through a dedicated advisory council.
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WINGS
The project started in 2020 with joint efforts from Pact
Ukraine, Light of Hope, Astarta and the Government
of Canada. It is directed at women to stimulate their
professional development and promote welfare.
Astarta supported 18 business start-ups from different
communities. The estimated number of women who took
part in the project – 3,000.
DUAL EDUCATION
In 2020 Astarta in partnership with the EBRD, EY and
Kharkiv National Agrarian University started a partnership
programme to support young specialists in receiving higher
education with particular attention to practical experience.
The theoretical part is provided by the University and the
practical part is realised at Astarta’s production sites.
In 2021 there were nine students on internship working
along experienced agronomists. Five students were hired by
the Company.
EFFECTIVE COMMUNITY
The programme was initiated by the Kyiv School of Public
Administration and supported by Astarta. Its goal is to
support economic development of local communities.
25 participants, mainly heads and deputy heads of local
communities, completed training.
THE SCHOOL OF CAREER ADVISER
The School of Career Adviser is an official programme for
professional development by the Institute of Modernisation
of Education Content of the Ministry of Education of Ukraine.
The programme involves school students and their parents,
teachers, school psychologists, as well as all those who
want to study the basics of career advising.
MANAGING
COVID-19
RELATED RISKS
In 2021 the world kept fighting against COVID-19 armed with
vaccine which significantly smoothed negative impact and
saved huge number of lives and helped counties worldwide
to return to normal. Due to vaccination Ukraine was also able
to soften the strictness of lockdowns allowing businesses to
operate in the environment closer to normal while keeping
minimum required preventive measures in place.
Astarta’s operations had not been materially affected by
the COVID-19 pandemic due to the outdoor nature of its
agricultural operations. The Company also took a proactive
stance by promoting vaccination along with other measures
aimed at securing employees’ safety in line with the
guidelines issued by the Government of Ukraine.
In 2021 Astarta organised vaccination for its employees at
business premises and in local medical institutions. By the
end of the year 62% of the employees in the Head Office and
51% of the employees in the regions were vaccinated.
At the same time Astarta kept safety measures in place for
continuity of business operations.
(1) Personnel
• Communication and education campaign on COVID-19
related risks.
• Mandating working from home for office-based
employees.
• Promotion of personal hygiene and distribution of
cleaning and sanitising means for use by employees.
• Daily health records of employees and their families.
• Support during illness and rehabilitation and supply of
vitamins.
• Psychological support for employees to reduce negative
impact of self-isolation.
• Access to distance learning to support professional
development in the pandemic conditions.
(2) Operations
• The Company continued to replace field equipment
with machinery which allows for significant savings
on human resources and maintenance at agricultural
operations.
• Digitalisation of the farming operations providing for
better accuracy and timeliness of the information.
(3) Finances
• The Company kept close contact with its lending banks,
with majority of them having financed its business for
many years.
• Investments were limited to maintenance capex only.
• In 2021 Astarta continued to support hospitals in the
regions of presence by providing the required materials
and organised training for medical staff.
BUSINESS
ETHICS
Business ethics is a set of principles and moral standards
that guides the Company while interacting with its
stakeholders. Through its history Astarta developed own
values which lay behind its success providing benefits to the
Company’s internal and external stakeholders.
The corporate values of the Company are presented on the
Company’s website and in the Code of Conduct, which sets
out and systematizes the rules and principles of conduct
that all employees of the Company must adhere to. Among
them are as follows: impeccable business reputation, social
responsibility, respect for partners, quality of goods and
services, conscientious performance of official duties, respect
for colleagues and management team of the Company.
Key Company’s values are delivered by the management
through open communication with employees on regular basis,
day-to-day work, and personal behavior. Management is open
to ideas from the employees and takes them on board on
regular basis. Any documents relating Company’s values are
usually reviewed and approved by the Compliance Committee.
BELOW ARE THE WAYS HOW VALUES ARE
INCORPORATED IN THE COMPANY
Impeccable business reputation
Each team member solves any task on a daily basis and takes
care of maintaining and ensuring an impeccable business
reputation of the Company. The Company precludes any
possible violations of the law by its team members and
partners, defends the principles of justice and honesty.
Social responsibility
The Company takes responsibility for the quality and
procedures of product creation by all its affiliate enterprises
towards the consumers, employees and partners. The
Company takes an active social position, which consists in
harmonious coexistence, interaction and ongoing dialogue
with society, participation in addressing acute social issues. By
setting a goal for social responsibility the Company promotes
sustainable development, including the health and well-
being of society, and considers the expectations of parties
concerned. The social responsibility value is integrated into
the activities of all structural subdivisions of the Company.
Respect for partners
When building cooperation with partners, the Company
takes into account not only its own interests, but also the
interests of the partners, strives for cooperation on mutually
beneficial terms and makes every effort to protect the
rights and interests of third parties when implementing the
Company’s business strategy. The Company gains the loyalty
and trust of the partners by doing business only by fair
means and in accordance with the standards of business
integrity.
Quality of goods and services
The Company is constantly working on important innovations,
individualization of solutions, and implementation of
industry-wide quality and compliance systems to constantly
upgrade the quality of its goods and services. Certification
of manufacturing processes and highly qualified specialists
is the Company’s standard practice.
Conscientious performance of official duties
The Company supports responsible work of each employee.
Correcting mistakes and learning, constantly improving, and
making work better are the principles of each employee and
the Company itself.
Respect for colleagues and management team of
the Company
The Company promotes a friendly working environment
based on respect for each individual and creating
possibilities for professional development. All employees
and management of the Company focus on working together
to achieve a common excellent result.
Key Company’s values are delivered by the management
through open communication with employees on regular
basis, day-to-day work, and personal behavior. Management
is open to ideas from the employees and takes them on
board on regular basis.
The Company systematically monitors the effectiveness of
the Code of Conduct.
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ANTI-
CORRUPTION
Anti-corruption compliance with relevant anti-corruption laws
are important elements of the Company’s business activity.
Astarta is committed to conduct all activities with integrity
and keeps zero tolerance towards breach of anti-bribery
and anti-corruption (ABC) Procedures. The Procedures are
applicable to all employees, regardless their position and
obligations. All employees are obliged to understand and
follow the above Procedures in order to struggle against the
corruption and bribery.
The basic internal regulations containing anti-corruption
procedures are as follows:
• Security Policy adopted in 2018. The Policy specifies
a common vision and approach to security, anti-
corruption, fraud, abuse and other violations based on
principles of complexity, timeliness, continuity.
• ABC Procedures adopted in 2020 that define goals, tasks,
principles, and directions of the Company’s anti-corruption
activities.
The ABC Procedures are integrated and comprehensive and are
applied at all activity levels and structural units of the Company.
As a preventive and precautionary measure of the Company’s
management and security department informational and
explanatory work regarding the relevant anti-corruption
provisions is performed within the Company. Any person
may report of any known or suspected violation either
personally to authorised employee, or unanimously through
the Whistleblowing line.
The Whistleblowing line is an effective mechanism of tracking
information regarding the existing or potential violations,
including anti-corruption ones, within the Company. All
potential counterparties are subject to security check for
compliance with anti-corruption laws.
Astarta effectively prevents the conflicts of interest among
employees and counterparts. The new procedures and
Regulation governing the real and potential conflicts of
interest were recently adopted.
The Company does not participate in charitable and
sponsorship projects with the direct or indirect purpose to
influence decisions of governing bodies or similar related
parties, that eventually may influence its business activity.
Information on all expenses of the Company in relation to
charitable and sponsorship activity is publicly available.
TASK FORCE ON
CLIMATE-RELATED
FINANCIAL
DISCLOSURES
Human activity has significantly influenced the climate
system change mainly as a result of use of fossil fuels,
deforestation and intensive agriculture leading to the
warming up of atmosphere, ocean and land.
Sustainability agenda became top priority worldwide
resulting in introduction of new regulations and standards
which require business to assess their environmental, social
and governance performance.
Although TCFD recommendations remain voluntary they
are recognised as a reliable guidance for reporting of
climate-related information and are embedded into the EU
legislation.
This report contains climate-related financial disclosure in
accordance with TCFD.
GOVERNANCE
The Board of Directors is responsible for overseeing the
climate-related issues. With this purpose the Sustainability
and Corporate Responsibility Committee was established in
2020 and consists of the members of the Board. It assists the
Board of Directors in fulfilling its responsibility for oversight
of relevant sustainability and corporate social responsibility
policies, strategy and projects s of the Company.
There is also an ESG committee at the executive
management level which is responsible for executing
sustainability strategy. The ESG committee consists of the
key members of executive management is chaired by the
CEO. The committee sets and reviews key ESG performance
indicators together with other issues including risks, strategy
and realisation of sustainability projects by the Company.
Sustainability issues are also considered by the Investment
Committee when reviewing new development projects to
identify potential risks, benefits and overall impact.
From 2021 the Director for Business Development and
Investor Relations leads the sustainability function on
behalf of the executive management board. The scope of
responsibilities covers sustainability strategy, monitoring
of implementation of sustainable practices, overseeing
compliance with local and international standards and
requirements in the sphere of sustainable development, as
well as reporting to stakeholders.
On a quarterly basis the Director for Business Development
and Investor Relations reports key ESG KPIs, progress
key concerns to the ESG committee of the Executive
Management Board and to the Board of Directors.
STRATEGY
Around 30 years ago the climate change became a front-
page issue in the global agenda when the United Nations
Framework Convention on Climate Change was adopted.
Since then, the topic picked up momentum as a global
warming became obvious and notable. Currently businesses
view climate change among the most significant risks and
embed these risks into their business models. Astarta
considers climate risks while planning its operational
activities and plans to perform a formal scenario analysis
of such risks.
Impact of climate change is first and foremost observed
in the Agriculture segment due to increase climate-related
hazards such as heat stress, lower precipitation and drought
leading to lower harvests and financials results. Astarta
adapted to these climate change risks by increasing the
share of winter crops in the crop rotation cycle. Winter crops
have better access to moisture in soil in spring and are
harvested before the hottest summer months.
The Agriculture segment is the key supplier of raw materials,
sugar beets and soybeans, to the Sugar production and the
Soybean processing segments. Therefore, the agricultural
output has a direct impact on the results of other segments.
Following a gradual shift in climate favourable zones for crop
growing from South-East to North-West of Ukraine sugar
beet growing activities in certain areas such as the Kharkiv
region became significantly riskier. In response to these
changes Astarta divested two sugar plants and stopped
growing sugar beet in this region. The Company is expanding
soybean growing in North-Western regions of Ukraine which
enjoys higher precipitation.
To have a better understanding of possible long-term climate
risks for its business and measures that Astarta can undertake
to reduce the negative impact it initiated the development of
a Climate Action Plan in partnership with the European Bank
for Reconstruction and Development in 2022.
The Climate Action Plan anticipates producing a set of
measures for the whole company and for each business
segment after the following stages:
a) Review of Astarta’s operations and their environmental
impact, including greenhouse gas emissions;
b) Analysis of the Company’s exposure to key climate risks
(transition and physical) and opportunities;
c) Identification of potential climate sensitivities in the
supply value chain;
d) Stress-testing and financial materiality assessment of
the Company’s business operations under different climate
change scenarios;
e) Implementation and monitoring reporting and evaluation
(“MRV”) of relevant metrics and targets for each business
segment;
f) Identification of climate action priorities and climate-
aligned investment planning.
Also with the support from DEG, the German development
finance institution, Astarta plans to start cooperation
with IfaS, the German Institute for applied Material Flow
Management to perform an Energy Efficiency Check of its
production assets in 2022. The project is also tasked with
developing specific targets for reduction of energy use,
input resources, carbon emissions and identifying required
technologies and investments.
The above projects will assist Astarta with crystallising a
dedicated climate change strategy with a decarbonisation
pathway and comprehensive climate risks analysis for
sustainable development of its business in the next decades.
SUSTAINABILITY GOVERNANCE
Strategic
level
Board
of Directors
ESG Committee
Dedicated ESG
functions
Investment
Committee
(ESG pre-screening)
Sustainability
and Corporate Respon-
sibility Committee
Operational
level
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RISK MANAGEMENT
Efficient risk management is the basis for delivering the
Company’s strategic goals. Astarta sees risk management
as an important element of future business growth in a
sustainable manner considering all types of risk it may face.
Among such risks are climate risks which are incorporated
into general risk management framework of the Company.
Astarta developed AgriChain, a proprietary software platform for
agribusiness management which provides IT solutions helping
the Company to better manage the physical risks through
precise application of agricultural inputs and technology.
Astarta also actively works with local farmers through
a dedicated Partnership centre to secure the required
volumes of raw materials such as sugar beets and soybeans
for processing.
The Company buys insurance against harvest loss from
droughts, natural disasters, abnormally low or high
temperatures.
Astarta’s farmland bank is spread among different regions
of Ukraine providing diversification against unfavourable
weather patterns on its operations.
Use of modern drought-resistant crop hybrids and increase
in share of winter crops reduces risks related to volatility in
precipitation.
According to TCFD Astarta identifies two groups of climate
risks: transition and physical risks.
Climate related risks relevant to Astarta
Group of Transition risks
• Policy and legal risks
Impact: adoption of climate regulatory controls and
imposition or increase in environmental payments such as a
tax and carbon-pricing mechanisms may lead to additional
costs in the form of taxes, or fines in case of violation of
corresponding legislation.
Ways for mitigation: strengthening of the corporate
governance, legal and compliance functions.
• Technology risk
Impact: the development and use of emerging technologies
may lead to loss of competitiveness of the Company’s
products due to higher cost of production.
Ways for mitigation: permanent assessment of new
technologies, professional growth of key employees
responsible for R&D, integration of the technology cost-
benefit analysis into the investment decision process.
• Market risk
Impact: decline in demand for the Company’s products due
to change in consumer preferences in favour of new climate
sustainable products.
Ways for mitigation: expansion of the product range,
assessment of global food trends and scenario analysis,
cooperation with food industry leaders.
• Reputation risk
Impact: potential negative media coverage on the
Company’s contribution to climate change can damage
reputation among stakeholders.
Ways for mitigation: crisis management plan, monitoring
of media activity, proactive communication with all
stakeholders, professional PR team.
Group of Physical risks
• Acute risk
Impact: increase in severity of weather events such as
heat stress, low precipitation and drought may lead to
deterioration of production results in agriculture.
Ways for mitigation: increase the share of winter crops in
crop rotation, use of drought-resistant crop hybrids with
shorter vegetation period, irrigation, precision farming,
regenerative agricultural technology.
• Chronic risk
Impact: gradual shift in climate favourable zones for crops
growing from South-East to North-West of Ukraine may lead
to the decline in yields of crops that are more sensitive to
precipitation and high temperatures.
Ways for mitigation: increase the share of winter crops in crop
rotation as winter crops are better secured in terms of moisture,
use of drought-resistant crop hybrids with shorter vegetation
period season, irrigation, precision farming, regenerative
agricultural technology, further geographical diversification of
the land bank towards North-West of the country.
For more information on risk management please refer to
the Risk Management section of this report.
Astarta also sees opportunities related to climate change
such as participation in the voluntary carbon credit markets.
If carbon farming is used across all farmlands, the Company
may potentially remove significant volumes of CO
2
from the
atmosphere creating carbon credits which can be used by
high emitters to offset their unavoidable emissions.
Transition to a low carbon economy will stimulate farmers
to switch from conventional farming methods in favour of
minimal or no-tillage turning agriculture into a key carbon
sink. Reduced tillage also improves soil health, preserves
from erosion, protects biodiversity and eventually leads
to higher productivity. Currently Astarta has 110kha of
farmland under minimal and subsoil tillage.
METRICS AND TARGETS
Astarta launched development a Climate Action Plan in
partnership with the European Bank for Reconstruction and
Development. The action plan will include targets developed
in line with the Science Based Targets Initiative (SBTi).
The Company also enhanced its reporting of GHG emissions
extending the disclosure to include Scope 2 and partial Scope
3 emissions. For more information, please refer to the section
Emissions and Acting on Climate Change of this report.
Along with setting the long- and medium-term SBTi based
targets within the Climate Action Plan Astarta also expects to
come up with specific targets for improvement in energy and
other natural resources use, GHG emissions and required
investments with assistance from IfaS, the German Institute
for applied Material Flow Management.
EU TAXONOMY
DISCLOSURE
According to the EU Taxonomy regulation, 2021 annual
reports by non-financial undertakings are under obligation
to publish non-financial information pursuant to Article 19a
or Article 29a of Directive 2013/34/EU. The report needs
to single out the proportion of business activities that are
considered as eligible and non-eligible with the Taxonomy
in their turnover, capital expenditure and operational
expenditure.
To identify eligible activities Astarta conducted preliminary
screening of its activities with respect to their eligibility with
the Taxonomy. As a result, the Company has not identified
any activities that meet the scope of the Taxonomy.
Therefore, 100% of the Company’s revenues (EUR491m),
capital expenditures (EUR16m) and operational
expenditure (EUR140m) were derived from non-eligible
activities per below.
For this disclosure:
• Total revenues – revenues from external customers
(Note 14 to the Consolidated Financial Statements);
• Capital expenditure - additions to tangible and
intangible assets considered before depreciation,
amortisation and re-measurements, including those
resulting from revaluations, impairments, excluding fair
value changes, and additions to tangible and intangible
assets resulting from business combinations (Note 21
to the Consolidated Financial Statements);
• Operational expenditure - R&D costs, building renovation
costs, short term leases, maintenance and repair costs,
all other direct costs necessary to operate the asset
(Notes 15, 16, 17, 18 to the Consolidated Financial
Statements).
At the same time Astarta has activities which it believes to
be environmentally sustainable and are not EU taxonomy
eligible. Among these activities are:
1. Anaerobic digestion of organic material with the
resulting production of biogas. The Company operates a
biogas facility which uses sugar beet pulp, a by-product
of sugar beet processing, for production of biogas. The
biogas is supplied to other production subsidiaries of
the Company. Therefore, the revenues from this supply
are recognised as intercompany revenues;
2. Organic farming. The organic farming methods utilised
by Astarta improve soil health and contribute to removal
of CO
2
from the atmosphere. One of the Company’s
subsidiaries obtained the status of an organic producer
and uses 1.8kha of farmland for its operations. In 2021
revenues from sale of organic produce to external
customers were EUR0.8m.
Within the process of development of a climate action
plan in future, Astarta will conduct a more detailed
screening for the eligibility and alignment of its activities
with the Taxonomy.
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Board of Directors of Astarta Holding N.V.
06 April 2022
Amsterdam, the Netherlands
Mr. V.Ivanchyk (signed)
Mr. H.A. Dahl (signed)
Mr. V.Gladky (signed)
Mr. M.M.L.J. van Campen (signed)
Mr. G. Mettetal (signed)
Mr. H. Arslan (signed)
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1 GENERAL
Astarta Holding N.V. (hereinafter referred to as “Astarta” or “Company”) was incorporated as a public limited liability company
(naamloze vennootschap) under Dutch law on 9 June 2006.
The Company is registered in the commercial register of the Chamber of Commerce and Industry for Amsterdam under number
34248891.
Astarta’s statutory seat is in Amsterdam, the Netherlands. The Company’s registration address is Jan van Goyenkade 8, 1075
HP, Amsterdam, the Netherlands.
The Articles of Association (statuten) were executed on 9 June 2006 and amended on 05 June 2018.
Astarta’s share capital is divided in ordinary shares with a par value of one cent (EUR0.01) each, all of the same class and kind;
there are no shares issued with special rights or privileges attached to them. There are no restrictions imposed by the Company
to transfer shares or certificates.
Astarta is pleased to present the corporate governance report of the Company for the 2021 financial year.
2 BOARD OF DIRECTORS
(a) Appointment and composition of the Board of Directors
The Company has a one-tier system of management that means that managing and supervisory duties are joined in the Board of
Directors. Appointment and/or dismissal and/or suspension of the members of the Board of Directors is the prerogative power of
the General Meeting of Shareholders. The General Meeting of Shareholders is authorised to determine the number of Directors.
The Board of Directors of the Company consists of six members: two Executive Directors A, one Executive Director B, and three
Non-Executive Directors С.
Directors A and Director B perform management duties and they are responsible for operational activity of the Company when
the Non-Executive Directors have the supervisory obligations and shall bring specific expertise on activity of Executive Directors.
Besides that two Non-Executive Directors – Mr. Dahl and Mr. Mettetal, are independent from the Company, shareholders of the
Company and the other Directors. One of the Executive Directors – Mr. Van Campen – is also independent.
Astarta promotes a balanced composition of the Board. The Company makes every effort for Board members to be selected
exclusively based on their qualification and abilities (including reputation and integrity), regardless of age, gender or any other
personal characteristics. Currently Astarta has a one-tier Board consisting of male members only. When the Company has a
vacancy at the Board, it will endeavor to engage female professionals to join the Board to promote gender diversity.
The members of the Board of Directors shall be appointed for a maximum period of four years. Reappointment is possible on
each occasion for a maximum period of four years, whereby the Non-Executive Directors may be reappointed once for another
four-year period. The Non-Executive Directors may then subsequently be reappointed again for a period of two years, which
appointment may be extended by at most two years. The profiles of the Board Members and re-appointment schedule can be
found on page 69-70.
The composition, duties and other issues of the Board of Directors of the Company are regulated by the Rules of the Board of
Directors adopted in accordance with article 15 paragraph 10 of the Company’s Articles of Association, Chapter 2 of the Dutch
Corporate Governance Code (as defined hereafter) applicable at the time and Best Practice of GPW-listed Companies (as defined
hereafter). The Rules of the Board of Directors are applied and interpreted with reference to the Dutch Corporate Governance
Code and the WSE Corporate Governance Rules. It can be viewed on the Company’s website (www.astartaholding.com).
The Board of Directors of Astarta consists of Mr. Viktor Ivanchyk and Mr. Viktor Gladky, as the Executive Directors A, Mr. Marcus
Van Campen, as the Executive Director B, Mr. Howard Dahl, Mr. Gilles Mettetal and Mr. Huseyin Arslan as the Non-Executive
Directors C.
(b) Representation
The Company is represented by the Board of Directors, however the Board may entrust the Executive Director A acting jointly with
Executive Director B with operational management of Company and Non-Executive Directors will supervise the policy and the
fulfilment of the duties by Executive Directors.
The Board of Directors is also authorised to grant power of attorney to represent the Company to one official with general or
limited power of representation. Nevertheless, such official shall meet requirements of having no conflict of interest and with due
observance of the limitations imposed on his or her powers. The Board of Directors determines the titles of such officials.
On 28 May 2021 the General Meeting of Shareholders resolved to appoint Mr. Valeriy Sokolenko, the Executive Director of LLC
Firm “Astarta-Kyiv”, as the person that will be temporarily charged with the management of the Company when all Directors are
absent or unable to act. Such appointment is in accordance with Article 19 of the Articles of Association. In 2021 there were no
cases of absence or inability to act of all Directors.
(c) The Directors
Following the demands of the best practice provision 2.1.1. of the Dutch Corporate Governance Code the Company has a profile
for its Directors, which indicates the information on size, composition and independence of the Board of Directors, the activities,
expertise and background of the Directors as well as desired diverse composition of the Board.
The Board of Directors is formed by the following persons:
VIKTOR IVANCHYK (born in 1956)
Executive Director A, Chief Executive Officer, Ukrainian national
Mr. Viktor Ivanchyk serves as an Executive Director A with the Company
and as the Chief Executive Officer since the Company’s incorporation.
Prior to founding Astarta-Kyiv in 1993, he worked for the Kyiv Aviation
Industrial Association (KiAPO) and then served at the State service. In
1993 he founded Astarta-Kyiv, which he has been the General Director
of since then.
In 2005 he became a Deputy Chairman of the Counsel of the National
Association of Sugar Producers of Ukraine “Ukrsugar” and, in 2007, a
member of the Presidium of Ukrainian Agrarian Confederation.
He graduated from the Kharkiv Aviation Institute named after N. E.
Zhukovsky (1979) and from the French Business School in Toulouse
(1994). In 2007 he completed a Senior Executive MBA Programme from
the International Management Institute (IMI Kyiv).
Shares owned in the Company (as at 31 December 2021): 5,000,000
(20.00%) (Ivanchyk Family: 10,000,000 (40.00%)) shares in the Company
held through a Cypriot holding company named Albacon Ventures Ltd.
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HOWARD DAHL (born in 1949)
Non-Executive Director C, Chairman of the Board of Directors, US citizen
Mr. Howard Dahl was appointed as a Non-Executive Director C with the
Company and the Chairman of the Board of Directors on 17 March 2017.
From 1987 till 2016 Mr. Howard Dahl was the member of Board for several
organizations, such as, North Dakota Council for the Arts, University of
North Dakota Foundation, North Dakota Trade Office, Federal Reserve
Bank of Minneapolis, Trinity International University. At present time Mr.
Howard Dahl serves the positions in the Amity Technology LLC, Ethics and
Public Policy Center and, The Trinity Forum, Washington DC, Stoneridge
Software, LongWater Opportunities, and the Center for Innovation
Foundation (University of North Dakota).
Mr. Howard Dahl graduated from the University of North Dakota B.S.,
University of Florida and Trinity Evangelical Divinity School M.A.
Shares owned in the Company (as at 31 December 2021): 6,717 (0.03%).
VIKTOR GLADKY (born in 1963)
Executive Director A, Chief Financial Officer, Ukrainian national
Mr. Viktor Gladky joined Astarta in 2012 and has been serving as an
Executive Director A with the Company since 2014.
Prior to joining Astarta, Mr. Gladky worked at the National Bank of
Ukraine (NBU) and was the Member of the Board of several state and
commercial banks, including the State Export-Import Bank of Ukraine
and Citi (Ukraine).
In 1985 Viktor Gladky graduated from the Kyiv State Shevchenko
University with a degree in international economics.
Shares owned in the Company (as of 31 December 2021): 13,109
(0.05%).
MARC VAN CAMPEN (born in 1944)
Executive Director B, Chief Corporate Officer, Dutch national
Mr. Marc van Campen serves as an Executive Director B with the Company
since its incorporation.
Prior to joining Astarta, Mr. Van Campen served in several positions
with Océ Van der Grinten N.V. and most recently, until 2002, as a
general counsel of NBM-Amstelland N.V. a Dutch company listed on the
Amsterdam Stock Exchange and at that time one of the largest companies
in the Netherlands in the field of construction and project development.
Mr. van Campen has, in the previous seven years, been Director at
Montferland Beheer BV at Schoonhoven (NL), Director at Ovostar Union
NV, Amsterdam, quoted on the Warsaw Stock Exchange, Director of the
European subsidiaries (outside Italy) of Salvatore Ferragamo SpA at
Florence, Italy, Director of International Internet Investments Coöperatief
U.A. at Amsterdam and Director of Global Worth Poland Real Estate N.V.
at Amsterdam.
Mr. van Campen is still holding the positions in the following entities:
Salvatore Ferragamo SpA and International Internet Investments
Coöperatief U.A.
He graduated with a master’s in law from the University of Nijmegen in
1968.
Shares owned in the Company: 0.
GILLES METTETAL (born in 1961)
Non-Executive Director C, French national
Mr. Gilles Mettetal has more than 30 years of international experience
in financing agriculture, agribusiness and real estate corporate sectors.
He has led and managed more than 600 transactions with EUR7bn
of financing, and conducted key transactions with corporates, banks,
investment funds and government and public institutions in over 40
countries.
Until June 2017 Mr. Mettetal was Director of the Agribusiness and
Property and Tourism teams at the European Bank for Reconstruction and
Development and also the Managing Director (interim) for the Corporate
Sector. He has held various positions as a non-executive director both for
multinational and local enterprises, such as Danone Industrial, Lu Polska,
Kraft Bolchevik, Bonduelle Kuban, Agrokor and Axereal PEC. Today, he is
also a member of the Supervisory Board of Nibulon and Chairman of the
Investment Committee of Diligent Capital Partners. He also serves as a
senior agribusiness expert for the United Nations Food and Agriculture
Organization, the African and the Asian Development Banks. He has
knowledge of English, French and Spanish languages.
In 1983, Gilles Mettetal graduated from the Ecole Nationale Supérieure
Agronomique de Montpellier: Diplôme d’Ingénieur Agronome.
Shares owned in the Company: 0.
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HUSEYIN ARSLAN (born in 1962)
Non-Executive Director C, Canadian citizen
Mr. Huseyin Arslan has 30 years of international experience in global
pulses and staple foods business. He presided as the President of AGT’s
Arbel Group subsidiaries in Turkey for 21 years. Mr. Arslan was one of the
founding shareholders of Saskcan, where he has served as a director or
trustee since 2008 and Executive Chairman of the Board since 2009. He
also served as a director of AGT subsidiary, Durum Gida Sanayi ve Ticaret
A.Ş. (“Durum”) and other companies in Turkey.
Mr. Arslan holds a Bachelor of Science in Electronics Engineering from
Middle East Technical University in Turkey.
In 2015, Mr. Arslan was a President of the Global Pulse Confederation, as
well as held positions in the Mersin Trade Commodity Exchange Council.
Currently the president of Mediterranean grain pulses and oily seeds
Exporters Union in Turkey.
Shares owned in the Company: 0.
The Resignation Schedule for Members of the Board of Directors has been drawn up in accordance with article 6.2 of the Rules
of the Board of Directors. It can be viewed on the Company’s website (www.astartaholding.com)
This schedule is completed, considering that a member of the Board of Directors will be appointed or reappointed for four-year
terms, whereby the Non-Executive Directors may be reappointed once for another four-year period and then subsequently be
reappointed again for a period of two years, which appointment may be extended by at most two years.
The Resignation Schedule is as follows:
Name
Date of first
appointment as director
Date of (possible)
reappointment Max. term
VIKTOR IVANCHYK June 2006 May/June 2022 Not Applicable
VIKTOR GLADKY June 2014 May/June 2022 Not Applicable
MARC VAN CAMPEN June 2006 May/June 2022 Not Applicable
HOWARD DAHL March 2017 May/June 2025 May/June 2029
GILLES METTETAL May 2018 May/June 2022 May/June 2030
HUSEYIN ARSLAN May 2019 May/June 2023 May/June 2031
(d) Shareholding by Directors and Insider Trading
The total number of the Company’s ordinary shares held by the members of the Board of Directors as of 31 December 2021 was
5,019,826 amounting to approximately 20,08% of the issued and paid-up share capital of the Company. The shareholding of the
Directors has been notified to the AFM (Autoriteit Financiële Markten).
With respect to acquiring ownership interest of securities and transactions in securities by the Directors, the Company applies the
Securities Rules of the Board of Directors.
With respect to acquiring shares in the Company’s capital by the Directors and other people that are involved with the Company,
the Company follows the provisions of the EU Market Abuse Directive and the Company’s Insider Trading Rules that reflect the
provisions of this Directive.
The Securities Rules of the Board of Directors and the Insider Trading Rules can be viewed on the Company’s website
(www.astartaholding.com)
In accordance with Article 2:98 of the Dutch Civil Code and article 10 of the Company’s Articles of Association the Company may
repurchase shares in set cases, but the number of shares, the manner and the price in which they may be acquired should be specified.
The General Meeting of Shareholders on 28 May 2021 (a) authorised the Board of Directors to continue repurchasing shares in
the capital of the Company up to a maximum of 12,500,000 shares, being 50% of the currently issued and paid up share capital
for a purchase price per share of up to PLN 125.00, and (b) to authorise that the repurchase shall take place through a broker
in the open market and is for the purpose of meeting obligations arising from (i) debt financial instruments exchangeable for or
convertible into equity instruments and/or (ii) employee share option programmes, or other allocations of shares to employees of
the Company or of a group entity of the Company, and (c) to resolve that the authorization is valid for a period of eighteen months
from 28 May 2021. Should the repurchased shares not (entirely) be used for its stock option plan, or for obligations arising from
debt financial instruments exchangeable for or convertible into equity instruments, such repurchased shares may be sold again
in the open market in accordance with Dutch law and the terms of the Company’s insider trading policy.
As of 31 December 2021, the Company repurchased 750,000 shares.
(e) Chairman of the Board of Directors and the Corporate Secretary
The Chairman of the Board of Directors is the person who determines the agenda for the Board of Directors’ meetings, chairs the
meetings and monitors the proper functioning of the Board of Directors and its committees.
Detailed information on competence of the Chairman of the Board of Directors can be viewed on the Company’s website
(www.astartaholding.com).
Mr. Howard Dahl held the position of the Chairman of the Board of Directors in 2021. The General Meeting of Shareholders on
28 May 2021 reappointed Mr. Howard Dahl as Non-Executive Director C in accordance with the Articles of Association of the
Company for the period of 4 (four) years.
The Board of Directors is assisted by the corporate secretary responsible for ensuring that accurate and sufficient documentation
exists to meet legal requirements, and to enable authorised persons to determine when, how, and by whom the business of the
Board of Directors was conducted.
From 09 November 2021 Mrs. Tetiana Gromova acts as the corporate secretary of the Company, her profile is available on the
Company’s website (www.astartaholding.com).
(f) Independence of the Board of Directors
The Company meets all requirements of the Dutch Corporate Governance Code regarding the independence of the Non-Executive
Directors according to the provision 5.1.1. Following the best practice provision 5.1.3 of the Code the Chairman of the Board of
Directors was not a former Executive Director and is independent within the best practice provision 2.1.8.
In opinion of the Board, the independence requirements referred to in best practice provisions 2.1.7 to 2.1.9 inclusive, have been
fulfilled.
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(g) Board meetings and attendance rate
For the reporting period the Board has held 6 (six) Board meetings and 3 (three) committee meetings. As a general rule, all Board
members were present at the Board meetings and committee meetings. An exclusion was the Board meeting as of 09 August
2021, during which Mr. Marc van Campen was absent due to a medical reason and in accordance with the best practice provision
9 of the Articles of Association of the Company Mr. van Campen authorized Mr. Ivanchyk to represent him at this meeting by
means of a written proxy.
(h) Evaluation of the Board of Directors
In summer 2021 the members of the Board of Directors have performed self-assessment by filling the corresponding questionnaire
in relation to their professional efficiency, presence of expertise to perform the Company’s strategic planning, establishment and
sharing of the Company’s mission and corporate values. Consequently, all Board members are deemed to be qualified for their
positions.
3 COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors formed three committees to aid compliance with applicable corporate governance requirements with a view
to financial transparency: the Audit committee, the Remuneration committee and the Sustainability and Corporate Responsibility
Committee. The powers and responsibilities of each Committee are established in the applicable Committee Charter, which
is approved by the General Meeting of Shareholders, Charters of the Committees are available on the Company website
(www.astartaholding.com).
(a) Audit Committee
The Audit Committee is responsible for reviewing annually and reassessing the adequacy of the rules governing the committee
as established by the Board of Directors. The Audit Committee is charged with advising on and monitoring the activities of the
Board of Directors with respect to inter alia, the integrity of the financial statements, the financing and finance related strategies
and tax planning.
The Audit Committee consists of the Chairman – Mr. Mettetal, and one member – Mr. Van Campen.
To make the activity of the Committee more efficient employees of the Company may be invited to the meetings as well as external
professionals for consultations.
Within 2021 financial year the Audit Committee, inter alia, discussed effectiveness of the risk-management and internal control
systems functioning, held the meeting with external auditors and discussed the audit. Additionally, the Audit Committee also
considered the Internal Audit Reports and the annual summary of the Whistleblowing line’s operation.
The Charter of the Rules governing the Audit Committee can be viewed on the Company’s website (www.astartaholding.com).
(b) Remuneration Committee
The Remuneration Committee is appointed by the Board of Directors.
The Remuneration Committee proposes to the Board, and the Board submits to the General Meeting’s approval, the remuneration
policies for Executive Directors and other Directors and the individual remuneration package of each Director.
Within 2021 the members of the Remuneration Committee were Mr. Dahl (the Chairman) and Mr. Mettetal.
The Remuneration Committee may request the attendance of Executive Directors or any key employee of the Company. The
members of the Remuneration Committee of the Company are qualified persons and before making some decisions or proposals
take into account all factors which they deem necessary, including having regard to the remuneration trends in other companies
similar to the Company in terms of size and/or complexity, results of fulfilment obligations by Directors, furthermore agreements
concluded and projects realized within the year.
During 2021 the Remuneration Committee conducted one meeting, during which remuneration and short-term incentive targets
(STI) for Executive Directors A were discussed.
The Charter of the Rules governing the Remuneration Committee can be viewed on the Company’s website
(www.astartaholding.com).
(c) Sustainability and Corporate Responsibility Committee
The Sustainability and Corporate Responsibility Committee assists the Board of Directors in fulfilling its responsibility for oversight
of relevant sustainability and corporate social responsibility policies, strategies and programmes of the Company.
The Sustainability and Corporate Responsibility Committee consists of the Chairman – Viktor Ivanchyk and two members –
Howard Dahl and Gilles Mettetal.
The Charter of the Rules governing the sustainability and corporate responsibility committee can be viewed on the Company’s
website (www.astartaholding.com).
4 CORPORATE VALUES
The corporate values of the Company are presented on the Company’s website and in the Code of Conduct. Among them are as
follows: impeccable business reputation, social responsibility, respect for partners, quality of goods and services, conscientious
performance of official duties, respect for colleagues and management team of the Company. Below are the ways how the
abovementioned values are incorporated into the Company’s business practices.
(a) Impeccable business reputation
Each team member performs daily tasks while taking care impeccable business reputation of the Company. The Company
prevents any violations of the law by its team members and partners, defends the principles of justice and honesty.
(b) Social responsibility
The Company takes responsibility for the quality and production processes by all its affiliate enterprises towards consumers,
employees and partners. The Company performs an active role in the society by harmonious coexistence, interaction and ongoing
dialogue within society, participation in resolving acute social issues. By setting social responsibility goals the Company promotes
sustainable development, including health and well-being of society, and considers expectations of all parties concerned. The
social responsibility value is integrated into the activities of all structural subdivisions of the Company.
(c) Respect for partners
When building cooperation, the Company considers not only its own interests, but also the interests of its partners, strives
for cooperation on mutually beneficial terms and makes every effort to protect the rights and interests of third parties when
implementing the Company’s business strategy. The Company gains loyalty and trust of the partners by doing business fairly and
with high integrity.
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(d) Quality of goods and services
The Company is constantly working on important innovations, tailored solutions, and implementation of industry-wide quality and
compliance systems to constantly upgrade quality of its goods and services. Certification of manufacturing processes and of its
highly qualified specialists is the Company’s standard practice.
(e) Conscientious performance of official duties
The Company supports responsible work of each employee. Correcting mistakes and learning, constantly improving, and
performing better are the principles of each employee and the Company itself.
(f) Respect for colleagues and management team of the Company
The Company promotes a friendly working environment based on respect for each individual and creating possibilities for
professional development. All employees and management of the Company focus on working together for common results.
Key Company’s values are delivered by the management through open communication with employees on regular basis, day-to-
day work, and personal behavior. Management is open to ideas from the employees and takes them on board on regular basis.
5 MONITORING THE EFFECTIVENESS
OF THE CODE OF CONDUCT
The Company systematically monitors the effectiveness of the Code of Conduct. The above function lies with the HR department
and Compliance Committee. During the reporting period the Compliance Committee held two meetings. The Committee has not
identified gross violations of the Code of Conduct. In August 2021 the Company appointed a compliance officer to conduct further
monitoring of effectiveness of the Code of Conduct more thoroughly.
6 REMUNERATION POLICY
The Remuneration Policy indicates the principal objectives that the amount and structure of the remuneration of the members of
the Board of Directors is such that (i) qualified managers can be retained and motivated; (ii) the smooth and effective management
of the Company is ensured, and (iii) the remuneration package with shareholder’s interests is aligned over both the short and
long term. Individual-specific responsibilities are taken into consideration in respect of the determination and differentiation of
the remuneration of the members of the Board of Directors.
The Company has committed itself to provide a total remuneration that is competitive, comparable to and consistent with the
practice in the agri-industry on a comparable market and is reasonable in relation to the Company’s operating results and size.
The Remuneration Policy for the Board of Directors can be viewed on the Company’s website (www.astartaholding.com).
7 SHAREHOLDERS MEETINGS, BOARD
MEETINGS AND COMMITTEES MEETINGS
IN 2021
The Company started its financial year from the discussion of the main operational and financial objectives, proposals in respect
of strategy of the Company and corporate social responsibility matters.
The date for the Board Meeting in 2021 was decided well in advance and communicated to the Directors. The Agenda along with
the explanatory notes was sent in advance to the Directors. The Chairman of the Board of Directors took all steps to ensure that
the necessary time is allowed for an effective discussion of the items on the agenda during the meeting, and to take point of
view from every Director who wished to put it forward. To make the meeting more effective the Company invited persons directly
responsible for the areas related to the Board’s agenda.
The Company has a one-tier structure where management and supervisory functions are joined in the Board of Directors. With
evaluation purposes the Company encourages the Non-Executive Directors to hold meetings for discussing the management
performance of the Executive Directors and Committee’s activity without Executive Directors being present.
The annual General Meeting of Shareholders of the Company was held in Amsterdam, the Netherlands on 28 May 2021.
Within the financial year 2021, the Board of Directors held: six meetings via a conference call, on 07 April 2021, 17 May 2021,
27 May 2021, 28 May 2021, 09 August 2021, 09 November 2021.
Within the financial year 2021, the Audit Committee was held via conference call on 17 April 2021 and 09 November 2021.
Within the financial year 2021, the Remuneration Committee was held via conference call on 28 May 2021.
8 GOVERNANCE AND CONTROL
(a) Dutch Corporate Governance Code
On 9 December 2003, a committee commissioned by the Dutch Government (Commissie Tabaksblat) published the Dutch
corporate governance code, which was amended on 10 December 2008 and became effective on 1 January 2009 (the “Dutch
Corporate Governance Code”). The Dutch Corporate Governance Code contains principles and best practice provisions for
management boards, supervisory boards, shareholders and general meetings of shareholders, financial reporting, auditors,
disclosure, compliance and enforcement standards. Dutch companies, whose shares are listed on a government-recognised
stock exchange, whether in the Netherlands or elsewhere, are required under Dutch law to disclose in their annual reports
whether or not and to what extent they apply the provisions of the Dutch Corporate Governance Code. If a company does not apply
the best practice provisions of the Dutch Corporate Governance Code, it must explain the reasons why it does not apply them.
On 8 December 2016 the Dutch Corporate Governance Code Monitoring Committee has published the revised Dutch Corporate
Governance Code (the Code). The Code has been revised at the request of the National Federation of Christian Trade Unions
in the Netherlands (CNV), Eumedion, the Federation of Dutch Trade Unions (FNV), Euronext NV, the Association of Stockholders
(VEB), the Association of Securities-Issuing Companies (VEUO) and the Confederation of Netherlands Industry and Employers
(VNO-NCW). The most important change is the central role given to long-term value creation, and the introduction of ‘culture’ as
a component of effective corporate governance. In addition, the Code has been updated in a number of other areas. The revised
Code came into effect as of January 01, 2017.
The Code is publicly available on the Company’s website: www.astartaholding.com and on the website of the Monitoring
Commissie: www.mccg.nl/english .
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(b) WSE Corporate Governance Rules
The Polish principles of corporate governance are provided in “The Code of Best Practice for WSE Listed Companies” approved by
the Resolution No. 12/1170/2007 of the Exchange Supervisory Board dated 4 July 2007. On 13 October 2015 the Code of Best
Practice for WSE Listed Companies was amended by Resolution № 26/1413/2015 of the Warsaw Stock Exchange Supervisory
Board and new amendments took effect from 1 January 2016.
Amended principles of “The Code of Best Practice for WSE Listed Companies” are applicable to companies listed on the Warsaw
Stock Exchange. The document is available on the website (www.astartaholding.com) in part “Corporate documents”.
(c) Application of the Corporate Governance Codes
The Company intends to comply with the Corporate Governance Codes, inter alia, by approval of the corporate governance
documents.
The above-mentioned set of corporate governance documents includes:
1. By-laws of the General Meeting of Shareholders
2. Rules of the Board of Directors
3. Rules on external auditor independence and selection
4. Profile of the Board of Directors
5. Resignation Schedule for the Members of the Board of Directors
6. Remuneration Policy
7. Charter of the Rules governing the Audit Committee
8. Charter of the Rules governing the Remuneration Committee
9. Charter of the rules governing the sustainability and corporate responsibility committee
10. Profile and Tasks of the Compliance Officer
11. Securities Rules of the Board of Directors
12. Code of Conduct
13. Whistleblower Rules
14. Insider Trading Rules
15. Dividend Policy
All these documents are available on Astarta’s corporate website (www.astartaholding.com).
(d) Confirmations in relation to the Dutch Corporate Governance Code
There has not been conflict of interest situations between the Directors and the Company during financial year 2021 in line
with the Principle 2.7 of the Dutch Corporate Governance Code. The Board of Directors would like to confirm that if there had
been such situations, the Board of Directors would report any potential conflict of interest in a transaction that is of material
significance to the Company and/or to such Director, to the Non-Executive Directors and to other members of the Board of
Directors without delay following the best practice provisions 2.7.3 of the Dutch Corporate Governance Code. The Director and/
or Non-Executive Director would have provided all relevant information with that regard, including the information relevant to the
situation concerning a spouse, registered partner or other life companion, foster child and relatives by blood or marriage up to
the second degree. The Director and/or Non-Executive Director would have reported any conflict of interest or potential conflict of
interest in a transaction that is of a material significance to the Company and/or to such Director, to the Non-Executive Directors
or to the Chairman of the Board of Directors. The Board would have decided outside the presence of such Director and/or Non-
Executive Director concerned, whether there is a conflict of interests.
The Board of Directors also confirms that there has not been any conflict of interest situations between the Company and
shareholders holding more than 10% of the shares in the Company’s capital during the financial year 2021. The Board of Directors
also confirms that if there had been any such situations, it would have acted in compliance with the best practice provision 2.7.5.
of the Dutch Corporate Governance Code assuring that such transactions should be agreed on terms that are customary in the
market. Decisions to enter in such transactions that are of material significance to the Company and/or such shareholders would
have required prior approval of the Non-Executive Directors. Such transactions would have been published in the management
report, together with a declaration that best practice provision 2.7.5. has been complied with.
The Board of Directors also confirms that no personal loans, guarantees, or the like, unless in normal course of business, were
granted to Directors and/or Non-Executive Directors in compliance with the best practice provision 2.7.6 of the Dutch Corporate
Governance Code.
Anti-takeover measures are a precautionary strategy used to protect the company’s autonomy and market competitiveness.
Management of Astarta tries to consider appropriate measures to mitigate the main risks in connection with takeover.
In accordance with the best practice provision 4.1.3. of the Dutch Corporate Governance Code resolutions to approve the policy
of the management board (discharge of management board members from liability) and to approve the supervision exercised
by the supervisory board (discharge of supervisory board members from liability) shall be dealt as separate agenda items of the
general meeting. By Laws of the General Meeting of Shareholders of Astarta Holding N.V. effective from 29 June 2007 set the list
of issues which the agenda of the General Meeting of Shareholders shall contain.
(e) Long-term value creation
Following the Principle 1.1. of the Dutch Corporate Governance Code, the Board of Directors is focused on long-term value
creation for the Company and its affiliated enterprises and takes into account stakeholders’ interests. Non-Executive Directors
monitor adherence to the above principle. The Company’s management aims to develop a sustainable strategy for the long-term
monitoring of new technologies and changes in business models and meeting stakeholder expectations.
The Company’s interpretation of the concept of long-term value creation is to create sustainable long-term value through the
achievement of operating and sustainability goals. The Company’s view on long-term value creation includes increasing the
Company’s capital and social return on investments. The Company is a reliable and trustworthy business partner and supplier,
committed to the best international standards of quality, innovation and sustainability.
The Company’s annual report states that Astarta adopts and shares the UN’s 2030 Agenda for Sustainable Development with 17
goals and contributes to their achievement. The Sustainability goals are closely connected with the Company’s mission and values
which are aimed at building strong Ukraine and strengthen its credibility in the world, unlocking and multiplying the potential of
its land and people and inspiring the society with exemplary business conduct, based on the principles of fair partnership, ethics
and development.
The Company’s policy is based on continuous improvement in the areas of environmental protection, labour protection, safety,
energy consumption and safety of products. These elements are part of the corporate integrated management system. The Energy
Efficiency Programme was developed to improve energy use and reduce its consumption at Astarta’s production subsidiaries.
Management targets reduction of gas and electricity consumption as an important element of business sustainability.
The Company has also determined the main principles of climate actions in the Policy on Climate change, GHGs emissions and
Energy efficiency for the purposes of emissions control. The Company also supports sustainable approach in relation to handling
waste.
Following the provisions 1.1.3, 1.1.4. of the Dutch Corporate Governance Code Non-Executive Directors supervise how the
Executive Directors work on the Company’s long-term value creation. The Board regularly discusses the progress and planned
steps in this regard and works on the long-term value creation strategy. The Executive Directors on a regular basis present their
views on long-term value creation strategy, discuss the suggested short-term and long-term developments considering the work
performed for the past financial year.
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9 INTERNAL CONTROL
General
The Board of Directors is responsible for the system of internal risk management and controls, and for reviewing their operational
effectiveness.
Internal risk management and control systems are designed to identify significant risks and to assist in managing those
risks that could prevent the Company from achieving its objectives. The systems however cannot provide absolute assurance
against material misstatements, errors, noncompliance, fraud, or violations of laws and regulations. Besides, any internal risk
management and control systems cannot provide total assurance of achievement objectives.
Since all key business operations are located in Ukraine, the risk management and internal control framework mentioned below
describes corresponding elements of such control at the level of the Ukrainian company – Astarta (unless stipulated otherwise),
which is established under and acting within Ukrainian legislation.
Control Systems
The internal risk management and control systems have two principal organizational forms:
(i) a structural and functional form, including regulations for functional collaboration of departments both horizontally (job
descriptions, charters of subsidiaries, rules of agreements, adjustment, regulations etc.) and vertically (rules of budgeting and
planning, financial and economic analysis, and control etc.) and
(ii) a direct control form.
With respect to (i), the control elements provide for functioning of overall control, which foresees, among other things, the following:
1) Control over the whole stage of business planning (budgeting)
Preliminary control over relative processes is executed over Astarta vertically, starting from designation of Astarta’s objectives
and tasks for the planning period and ending with adoption by the management of subsidiaries, prepared and coordinated with
all participants following verification concerning conformity with objectives.
Current control over business plans (budgets) is executed firstly by comparing actual budgets with adopted plans in order to
control fixed deviations and prevent adverse forthcomings for particular subsidiaries and Astarta as a whole. All deviations are
analysed in order to reveal the reasons for deviating and the measures to be taken in order to eliminate these deviations.
2) Control over revenues and expenses
Control over revenues and expenses of the subsidiaries of Astarta as well as over crediting and withdrawal of funds of these
subsidiaries is executed by way of elaboration on regulations regarding budgeting and elaboration of the budget of Astarta’s
subsidiaries.
The Budget Committee functions in order to improve efficiency of control over revenues and expenses of subsidiaries, which
holds meetings on a regular basis to approve budgets and control over budgeting in Astarta and its subsidiaries.
3) Control over sales of subsidiaries of the Group
Astarta provides for centralized sales of the Group’s core products. This occurs via negotiations with consumers, drafting
schedules of dispatching and sending them to subsidiaries. Control over sales is established in a way of control over execution of
the dispatching schedules by the subsidiaries as well as cooperating with the consumers.
4) Control over purchasing and logistic functions of the Group
Astarta provides centralization of purchasing and logistic functions. In addition, the most tenders of purchasing are executed
centrally with further control of compliance. It provides for effective and productive operational results.
Functional departments undertake measures for automation of purchasing in order to make the processes more efficient.
5) Control over investment decisions
Astarta has been developing procedures for formalizing investment decisions. The Investment Committee functions to improve
efficiency of the investment-making process and to minimize risks associated with wrong investment decisions. Regulations of
investment processes are being improved to decrease risks when implementing projects. The Company’s internal control system
encompasses thorough due diligence of companies, which it regards as a potential investment candidate.
6) Control over financial and tangible assets
Astarta provides for centralized and automated control over accounts receivable in subsidiaries. It helps to increase essentially
the financial liquidity system of the Group and the effectiveness of use of financial resources. In addition, Astarta exercises
centralized control over the retirement of basic assets and effectiveness of their utilization.
7) Policy of economic security
This policy is realized by a well-established system within the economic security service, which is a vertically integrated chain of
security departments at the level of Astarta and its operational subsidiaries. The Company has created a monitoring system for
preventing conflicts of interest and fraud. Astarta has also improved regulations of IT security.
8) Whistleblowing Line
In accordance with recommendations of an external consulting company, Astarta maintains a Whistleblowing Line. Everyone
who works in the Company or with Astarta can provide information about suspected fraud or other violations by telephone, post,
e-mail, or the Company’s website. This information may be left anonymously if the contacting person decides so.
9) Compliance Committee
At the level of LLC Firm “Astarta-Kyiv” the Compliance committee has been functioning for the second year and in 2021 consists
of eight members, in particular:
• CEO (Chairman).
• Chief financial officer.
• Chief legal officer.
• Executive Director.
• Business development and IR Director.
• HR Director.
• Head of IT Development Department.
• Head of the Corporate governance and Compliance Department.
The compliance committee supports the Board of Directors with its responsibility in assuring and managing compliance. Under
the scope of the compliance committee mainly fall the following fields of expertise such as (i) issues relating to the Code of
Conduct, (ii) anti-bribery, (iii) fraud, (iv) conflicts if interests (v) data protection, (vi) human rights, (vii) KYC procedures and (viii)
results of operations of the Whistleblowing line. The compliance committee systematically identifies material compliance risks
in the abovementioned fields, assists in assurance of compliance with laws and regulations, monitors compliance and report
findings and recommendations to the Board of Directors. In 2021, the key focus area was reviewing of the internal procedures
regarding the conflict of interests, KYC procedures, human rights protection and data protection. In this respect, the numerous
trainings were provided on compliance related topics to the dedicated audiences.
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10) Focus on the risk of fraud
The primary responsibility for the prevention and detection of fraud lies with the Board of Directors.
As a part of process of identifying fraud risks, the Company evaluated fraud risk factors with respect to financial reporting fraud,
misappropriation of assets and bribery and corruption. Forensic specialists evaluated the fraud risk factors to consider whether
those factors indicated a risk of material misstatement due to fraud. Besides that, to avoid the abovementioned risks, the
Company amended corresponding internal Regulations and procedures, and also strengthened the control over the Company’s
operations at all levels in 2021.
At the same time, in order to prevent abuse in prices formation for the sale of products in the company, there is a Pricing
Committee, which analyses the trends of price changes in world markets and compares them with the prices used by the
Company in the sale of products.
The Company also has an electronic procurement system that ensures competitive procedures while selecting product suppliers.
All procurements starting from 5 thousand dollars by value shall be processed by this electronic procurement system and
approved by the Tender Committee.
In addition, the Company performed procedures to obtain an understanding of the legal and regulatory frameworks that are
applicable for Astarta. The Company identified provisions of those laws and regulations, generally recognised to have a direct
effect on the determination of material amounts and disclosures in the financial statements, such as the financial reporting
framework and tax and pension laws and regulations.
The Company pays considerable attention to preventive measures. Compliance and security departments monitor compliance
with internal Security and Anti-Corruption Regulations. Cases of fraud, in case of their detection, are subject to consideration by
the compliance committee. If necessary, internal investigations may be conducted.
As in all audits, the Company addressed the risk of management override of internal controls, including evaluating whether there
was evidence of bias by management that may represent a risk of material misstatement due to fraud. The audit procedures
to respond to the assessed risks include, amongst others, that the Company evaluated the design and the implementation of
internal controls that mitigate fraud risks, retrospective review of the previous year’s estimates and incorporated elements of
unpredictability in audit. In addition, the Company assessed matters reported on the Astarta’s whistleblowing procedures and
management’s investigation of such matters.
Astarta continues to develop automation of the different internal control functions.
The department of accounting and taxes develops uniform accounting policies for all Astarta’s subsidiaries, exercises control over
the subsidiaries periodically, and examines compliance of the subsidiaries with the accounting standards and policies in place.
The Internal Audit Department plays an important role in the internal control system assessment and its activities are designed to
add value and improve the operations of Astarta and its subsidiaries. It helps the Company to accomplish its objectives by bringing
a systematic disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance. An
internal audit function aims to enhance and defend the Company’s organizational value by providing risk-based and objective
assurance, advice, and insight.
In connection with the abovementioned, Astarta is aware that some functions of its internal risk management and control systems
need to be reviewed, evaluated, and improved. The Company believes that it takes adequate and appropriate steps to strengthen
internal risk management and control systems regularly.
Deficiencies
Over the period covered by this annual report, the Company had not identified any control issues that could be classified as a
material weakness or having a material impact on the operational and financial results. The Company had, however, identified
some needs for control improvement as outlined below.
The first group of issues is related to the IT system and control improvement, including issues of usage of the system as well as
a means of control. Astarta strengthened its IT department in order to use IT as a measure of control for efficiency improvement
and a cooperation tool with the security department, department of procurement, financial department, operating departments,
internal audit department, and other subdivisions.
The second group relates to insufficient formalization and optimization of processes of financial and management accounting. In
order to resolve these issues, Astarta initiated the analysis to enable:
(i) standardization and improvement of the financial accounting system and its compliance with IFRS as adopted by the European
Union and part 9 of book 2 of the Dutch Civil Code, as well as
(ii) formalization of management accounting aimed at control of the fulfilment of designated tasks in the process of business
planning.
According to specific regulations, Astarta can also verify and improve system of internal control over financial reports. The
Company’s external auditors are obligated to consider internal control over financial reporting as a basis for designing their
auditing procedures for the purpose of expressing their opinion on the consolidated financial statements. In addition, Astarta has
discussed own assessment of control and risk management framework with external auditors.
The Board of Directors believes that the Company’s internal risk management and control systems have not led to any major
problems or material errors in the 2021 financial reporting of the Company. The corresponding internal risk management and
control issues were regularly considered by the Audit Committee, when required. The Board of Directors makes every effort for
the Company’s internal risk management and control systems to be implemented effectively, but note that there are areas where
the deficiencies as described above were identified, in relation to which adequate remedial actions have been taken in 2021.
10 DEVIATION FROM THE DUTCH CORPORATE
GOVERNANCE CODE AND THE CODE OF BEST
PRACTISE FOR WSE LISTED COMPANIES
As the Company is incorporated under the laws of the Netherlands, apart from applying the Code of Best Practice for WSE Listed
Companies, the Company complies with the Dutch Corporate Governance Code by applying its principles and provisions that are
applicable, or by explaining why the Company deviates from them. The Company adheres to both Dutch Corporate Governance
Code and Warsaw Stock Exchange Corporate Governance Rules.
Since the WSE Corporate Governance Rules are similar to the rules provided under the Dutch Corporate Governance Code, a
majority of the principles and best practice provisions of the Dutch Corporate Governance Code are being complied with. Since
the first General Meeting of Shareholders held after the listing of the Company’s shares on the Warsaw Stock Exchange, all the
internal documents and regulations concerning the corporate governance rules of the Company were adopted and amended
from time to time.
The Company currently does not apply the following provisions of the Dutch Corporate Governance Code:
Best practice provision 2.1.5. diversity policy
The Company has a one-tier board consisting only of male members. When the Company has a vacancy at the Board, it will
endeavor to engage female professionals to join the Board to promote gender diversity.
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Best practice provision 2.3.2.: establishment of committees
The Company has a one-tier structure with only three Non-executive directors and is therefore not obliged to have committees.
However, the Company has a remuneration committee and an audit committee.
Best practice provision 5.1.4: composition of committees
In accordance with this provision, the committees referred to in best practice provision 2.3.2 should be comprised exclusively of
Non-Executive directors. Since the Company has only three Non-Executive Directors, the executive directors are also committee
members.
Best practice provision 5.1.1: composition of the management board
In accordance with this best practice provision, the majority of members of the management board shall be non-executive
directors and shall meet the independence requirements stipulated in the best practice provisions 2.17 and 2.18 of the Dutch
Corporate Governance Code. As for the Company, it has three Non-Executive Directors out of six Directors; three members of
the Board of Directors are independent. The reason for this is to keep the Board of Directors as small and simple as possible. To
apply the best provision 5.1.1 would mean that the Board of Directors should be comprised of nine persons; since Mr. Dahl and
Mr. Mettetal are independent non-executive directors, three additional independent non-executive directors would be required.
This is not considered to be in the best interests of the Company and would rather complicate matters.
As for “The Code of Best Practice for WSE Listed Companies” the Company does not apply the following:
I. Disclosure Policy, Investor Communications
I.Z.1.15. information about the company’s diversity policy applicable to the company’s governing bodies and key managers; the
description should cover the following elements of the diversity policy: gender, education, age, professional experience, and
specify the goals of the diversity policy and its implementation in the reporting period; where the company has not drafted and
implemented a diversity policy, it should publish the explanation of its decision on its website.
The Company does not have Diversity policy, as the separate document, however since 2007 year the Company has adopted
Rules of the Board of Directors, which include Profile of the Board of Directors, Resignation schedule for members of the Board
of Directors and other documents regulating the Board of Directors’ composition, decision making process, working method,
allocation of powers and general functioning. Corporate documents of the Company don’t contain the information with respect
to gender or age requirements to members of the Board of Directors as the main principles in engagement of Directors are
their qualifications, experience and compliance with the independence criteria and principles of their past and current activity
in other companies. The Company has consistently applied a policy whereby governing and managerial positions are filled by
competent, creative individuals possessing the necessary experience and education. Recently the Company has started working
on development of the Diversity Policy as a separate document.
II. Management Board, Supervisory Board
II.Z.3. At least two members of the supervisory board should meet the criteria of being independent referred to in principle
II.Z.4. and II.Z.4. Annex II to the European Commission Recommendation of 15 February 2005 on the role of non-executive or
supervisory directors of listed companies and on the committees of the (supervisory) board applies to the independence criteria
of supervisory board members.
Irrespective of the provisions of point 1(b) of the said Annex, a person who is an employee of the company or its subsidiary
or affiliate or has entered into a similar agreement with any of them cannot be deemed to meet the independence criteria. In
addition, a relationship with a shareholder precluding the independence of a member of the supervisory board as understood in
this principle is an actual and significant relationship with any shareholder who holds at least 5% of the total vote in the company.
There is only one governing body in the Company, the Board of Directors comprising both Executive and Non-Executive Directors,
which fulfils the duties respectively, both of a Polish-style management board and supervisory board. According to the Articles
of Association (Article 12.3), at least half of the Non-Executive Directors have to be independent and if the Company has a
shareholder holding shares carrying more than fifty per cent (50%) of all voting rights, then the Board of Directors should have at
least two independent Non-Executive Directors.
Pursuant to the Articles of Association such independent Non-Executive Director may therefore not be:
a. an officer, employee or agent of the Company;
b. a director, officer, employee or agent of any affiliated company or enterprise;
c. a shareholder holding at least ten per cent (10%) of shares in the Company;
d. a director – or a representative in some other way – of a legal entity holding at least ten percent (10%) of shares in the
Company, unless the entity is a group company.
Currently there are two independent Non-Executive Directors in the Board of Directors. The Company believes that due to its
single board structure, it is not necessary to appoint more independent Non-Executives Directors. The present composition of the
Board of Directors allows protecting properly interests of both minority and majority shareholders and ensures the transparency
in functioning. However, if the Company considers that protection of shareholders’ interests is not sufficient, another independent
member of the Board of Directors will be immediately recommended to be appointed.
II.Z.5. Each supervisory board member should provide the other members of the supervisory board as well as the company’s
management board with a statement of meeting the independence criteria referred to in principle II.Z.4.
The Company has a one-tier board structure, managerial and supervisory duties are joined by the Board of Directors consisting
of Executive and Non-Executive Directors. Non-Executive Directors perform supervising duties. Subject to Rules of the Board
of Directors, at least fifty per cent (50%) of the total number of Non-Executive Directors shall be independent in the meaning
provided in the Articles of Association of the Company. If the Company has a shareholder holding shares carrying more than fifty
per cent (50%) of all voting rights at the General Meeting, then the Board of Directors shall consist of at least two independent
Non-Executive Directors. At this stage, there are no shareholders holding more than fifty per cent (50%), however the Company
has three independent Non-Executive Directors. The information with respect to profile of the Non-Executive Directors and their
activity is set in corporate governance report which is the part of the annual report. II.Z.10.2. a report on the activity of the
supervisory board containing at least the following information:
- full names of the members of the supervisory board and its committees;
- supervisory board members’ fulfilment of the independence criteria;
- number of meetings of the supervisory board and its committees in the reporting period;
- self-assessment of the supervisory board.
The Company has a one-tier board structure, there are Executive and Non-Executive Directors in the Board of Directors of the
Company. The information in respect of the Non-Executive Directors and their activity is set in corporate governance report which
is the part of the annual report.
III. General Meeting, Shareholder Relations
IV.R.2. If justified by the structure of shareholders or expectations of shareholders notified to the company, and if the company
is in a position to provide the technical infrastructure necessary for a general meeting to proceed efficiently using electronic
communication means, the company should enable its shareholders to participate in a general meeting using such means, in
particular through:
1) real-life broadcast of the general meeting;
2) real-time bilateral communication where shareholders may take the floor during a general meeting from a location other
than the general meeting;
3) exercise of the right to vote during a general meeting either in person or through a plenipotentiary.
The corporate documents of the Company provide that all the meetings take place where the company’s registered office is
situated, in the municipality Haarlemmermeer (Shiphol) or any other place within the Netherlands agreed upon by the Board
of Directors. In a meeting held elsewhere, valid resolutions can only be taken if the entire issued capital is represented. The
Company however supports its shareholders to exercise their voting rights by authorizing the company’s proxies who are bound
by instruction or a third party.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
84 85
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
11 REMUNERATION REPORT
Background
This remuneration report was drawn up in accordance with requirements of the engagement EU Directive on the encouragement
of long-term shareholder engagement (SRD II) and Art. 2:135b of the Dutch Civil Code.
Astarta is interested to remunerate the Directors in such way that they may expect to receive estimation in line with the market,
taking into account the annual results of Astarta and individual achievements, namely contribution of each Director to the
development of the Company.
Gross profit increased by 80% y-o-y to EUR219m due to the record-breaking yields in grains and oilseeds and higher market
prices of agricultural produce. EBITDA increased from EUR113m in 2020 to EUR201m in 2021 with higher contribution from the
Agriculture and Sugar Production segments.
In 2021 the Company continued development of elevator business and completed construction of additional 12kt silo tower
on the site of Krasyliv elevator which increased total grain and oilseeds storage capacity to 562kt. Besides, the in-house
AgriChain Scout system was rolled out on 100% of the Company’s arable land area in 2021 (vs 75% in 2020). The system is
aimed to improve harvest predictability by integrating crops monitoring, agrochemical status, meteorological data and plant
vegetation status. Also, due to Astarta’s Partnership Centre amid efficient cooperation with independent farmers was realised
and as consequence third-party sugar beet supply reached 20% of total.
The remuneration of the Directors of the Company is also influenced by market trends such as market remuneration rates,
market prices for key products, industry trends in types of compensations to retain high-qualified directors. Global sugar prices
increased by 25% y-o-y to USD471/t due to expectations of a sugar deficit and rising global prices for all raw materials and
utilities (especially gas). In the first half of 2021 domestic market faced sugar shortages amid decrease in sugar production in
the previous season caused by a decline in areas under cultivation and weak sugar beet yields. As the result yearly average sugar
price in Ukraine increased to USD655/t (+66% y-o-y). Indeed, the new sugar production season was delineated with dynamically
rising gas prices causing a severe increase in production costs, since the energy component is the second largest in the cost of
production after sugar beet. Prices for mineral fertilizers are also expected to rise and affect the costs of growing sugar beets
in the new season. According to the National Association of Sugar Producers “Ukrsugar” beet sugar output in Ukraine totalled
1.44mt (up by 25% y-o-y) with 33 sugar plants running in 2021. Astarta retained its leading position in the Ukrainian sugar
market with a 22% share.
During 2020 and 2021 there were no changes in the composition of the Directors of the Company.
The Directors of the Company are remunerated according to the Remuneration Policy adopted on 28 May 2021. The Company
shall not make any payments as remuneration to the members of the Board of Directors, whether annual payments, periodical
payments/rewards, payments payable on a certain term, entitlements to profits, bonuses or pension payments, whether in cash
or in kind, other than in accordance with the Remuneration Policy.
As previously reported the Company is a holding company with all production assets situated in Ukraine. Considering this fact,
the Executive Directors A shall be involved in the operational process in Ukraine, therefore the operational management of the
Company is carried out at the sub-holding level – by the management of LLC Firm “Astarta-Kyiv”. Thus, the Company defines
management remuneration - (i) for directors who do not take part in the operational management (the Executive Directors B
and the Non-Executive Directors), and (ii) for directors who take part in the operational management (the Executive Directors A).
Total remuneration
The remuneration policy seeks to enable members of the Board of Directors to receive market competitive levels of
remuneration. To this end, the Company uses principles regarding total remuneration that are competitive, comparable to
and consistent with the practice in the agricultural industry on a comparable market, as well as in reasonable relation to the
Company’s operating results.
Members of the Board of Directors who do not take part in a day-to-day operational activity of the Company can receive
remuneration in the form of an annual fixed remuneration and are not entitled to any variable performance-related remuneration.
Those members of the Board of Directors (Executive Directors A) who take part in a day-to-day operational activity of the Company,
can receive remuneration package consisting of an annual fixed and variable remuneration. The Remuneration Committee
performs scenario analysis to assess the impact that different performance levels will have on the total remuneration of the
Executive Directors A in amount of variable part.
Annual fixed remuneration
Annual fixed remuneration is set in the Remuneration Policy range by the Board of Directors upon proposal of the Remuneration
Committee. Annual fixed remuneration is usually reviewed annually, without any commitment to increase, after adoption of the
annual accounts.
On 28 May 2021, in accordance with Remuneration Policy dated 28 May 2021 year the Board of Directors approved and ratified
the remuneration of the Chairman of the Board at EUR75,000 per year, Non-executive director at EUR40,000 per year, Chief
Corporate officer at EUR40,000 per year for financial year 2021.
The Executive Directors A shall be remunerated by its subsidiary LLC Firm “Astarta-Kyiv”. Thus, the Board of Directors approved
the following recommended fixed remuneration of Executive Directors A for 2021: Mr. Ivanchyk, CEO – equivalent of EUR360,000
and Mr. Gladky, CFO – equivalent of EUR276,000.
The abovementioned resolutions are approved based on the Remuneration Policy, the results of examination of the consolidated
financial statements as at and for the year 2020 approved by the General Meeting of Shareholders as well as upon the
Remuneration Committee’s proposals dated 28 May 2021.
Remuneration of the Executive and Non-Executive Directors for reported financial years
all in EURk
Director’s
name
Position
Financial
year
Fixed remuneration Variable remuneration
Total
remuneration
Proportion
of fixed and
variable
remuneration
Base
salary
Reimbursable
expenses
One-year
variable*
Multi-year
variable**
Viktor
Ivanchyk
Executive Director
A (Chief Executive
Officer)
2021 382 - 360 - 74 2 51% / 49%
2020 360 - - - 360 100% / 0%
Viktor
Gladky
Executive Director
A (Chief Financial
Officer)
2021 271 - 240 - 511 53% / 47%
2020 240 - - - 240 100% / 0%
Marc van
Campen
Executive Director
B (Chief Corporate
Officer)
2021 40 - - - 40 100% / 0%
2020 40 - - - 40 100% / 0%
Howard A.
Dahl
Non-Executive
Director (Chairman
of the Board of
Directors)
2021 75 - - - 75 100% / 0%
2020 75 - - - 75 100% / 0%
Gilles
Mettetal
Non-Executive
Director
2021 40 - - - 40 100% / 0%
2020 40 - - - 40 100% / 0%
Arslan
Huseyin
Non-Executive
Director
2021 40 - - - 40 100% / 0%
2020 40 - - - 40 100% / 0%
* The one-year variable remuneration consists of the annual bonus which is recognised as an expense in the year that the Board of Directors decides that the bonus will
be paid based on the performance of the previous financial year. The STI outcome for Net Profit and EBITDA as estimated as of 31 December 2020 and disclosed in the
Group’s Remuneration report for 2020, amounted to 150% and 138% of fixed remuneration, respectively. Following the decision made by the Board of Directors based on
recommendations of the Remuneration Committee in the respective meeting held in May 2021, the actual STI payments were reduced to 100% of fixed remuneration for the
financial year ended 2020 for both, Victor Ivanchyk and Viktor Gladky.
** The multi-year variable remuneration relates to the performance of LTI targets
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
86 87
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Additionally, expenses on the LTI plan (Multi-year variable) for the year ended 31 December 2021 were accrued for Mr.Ivanchyk
in the amount of EUR 600 thousand and for Mr. Gladky in the amount of EUR 415 thousand (2020: no expenses were accrued).
These expenses are not part of total 2021 remuneration in the table above, as these LTI awards were not received by management.
Total remuneration including accrual for multi-year variable for Mr.Ivanchyk resulted in amount of EUR 1,342 thousand and for
Mr. Gladky resulted in amount of EUR 926 thousand for 2021 (2020: for Mr.Ivanchyk in amount of EUR 360 thousand and for
Mr. Gladky in amount of EUR 240 thousand).
VARIABLE REMUNERATION
As the Company is public, it is essential that the Company can attract and retain qualified officers to the Board of Directors.
Equally, their performance should be focused on achieving those strategic aims which promote the business of Astarta, safeguard
and create sustainable long-term value through the achievements of operating goals. Therefore, annual remuneration of the
Executive Directors A who take part in a day-to-day operational activity of the Company should reflect performance of Astarta.
The total value of remuneration that can be earned rises with the level of performance that is delivered. For this purpose, the
Company includes a variable part into the annual remuneration of Executive Directors A. The Company expects that variable
compensation will represent between 0% and 80% (depending on whether relevant goals are achieved) of total remuneration of
the Executive Directors A. The remuneration structure serves as a motivation for Executive directors A to achieve high results in
development of the business that are in line with the long-term interests of the Company and its shareholders.
According to the Remuneration Policy variable remuneration of the Executive Directors A is affected by short-term (STI) and
long-term incentives (LTI). The STI is designed to give focus to a range of strategically important annual objectives for a one-year
performance period. Collectively, these objectives are targeted to deliver a level of performance which is in line with operational
plans, that are vital to create value in the long term. They do not incentivize undue risk-taking or other behaviours which are
contrary to the Company’s interests. Under the STI, Executive directors A are granted opportunities to earn cash bonuses based
on the level of achievement of Net profit and EBITDA metrics for the applicable annual performance period. Measures will
normally be weighted as 50% for Net profit and 50% for EBITDA. These metrics are used or defined in the Company’s annual
report and annual remuneration report, subject to minor adjustments if required, in order to provide an appropriate indicator
of management’s performance. On 28 May 2021 the Board of Directors acting on the recommendation of the Remuneration
Committee set the following performance ranges for the financial year 2021: (i) up to 150% of fixed remuneration, payout will
be made if Net profit is no less than EUR25m and EBITDA is no less than EUR115m; (ii) intermediate percentage payments will
be made if Net profit is no less than EUR0m and EBITDA is no less than EUR95m; (iii) no payouts will be made if Net profit is
less than EUR0m and EBITDA is less EUR95m. Correlation between the performance ranges and variable remuneration of the
Executive Directors A based on the STI in the reported financial year is presented in the table below. The STI is paid in cash when
performance over the previous year has been assessed, at which time the conditional grant is vested. A decision regarding the STI
payment will be made by the Board of Directors based on recommendations of the Remuneration Committee in the respective
meeting in 2022.
Performance of the Executive Directors A on STI targets in reported financial year
Information on performance targets
Director’s
name
Position Metric
Relative
Weighing
a) Minimum target /
threshold
b) Corresponding
award
a) Maximum target /
threshold
b) Corresponding
award
a) Measured
performance
b) Actual award
outcome
Viktor Ivanchyk
Executive
Director (Chief
Executive
Officer)
Net profit 50%
a) less than EUR0k
b) 0%
a) not less than
EUR25,000k
b) 150%
a) EUR122,491k
b) 150%
EBITDA 50%
a) less than
EUR95,000k
b) 0%
a) not less than
EUR115,000k
b) 150%
a) EUR201,459k
b) 150%
Viktor Gladky
Executive
Director (Chief
Financial
Officer)
Net profit 50%
a) less than EUR0k
b) 0%
a) not less than
EUR25,000k
b) 150%
a) EUR122,491k
b) 150%
EBITDA 50%
a) less than
EUR95,000k
b) 0%
a) not less than
EUR115,000k
b) 150%
a) EUR201,459k
b) 150%
The Company’s LTI is designed on give focus to the strategic priorities that will contribute to building sustainable long-term value
creation. By making awards in equity of the Company, alignment is created between the Board of Directors and shareholders.
The long-term performance is stimulated through the opportunity for the members of the Board of Directors, namely Executives
Directors A, to get shares following achievement of key ROE (Return on Equity) goal which is measured for a three-year period.
Such incentive is a subject to prior approval of the Board acting on the recommendation of the Remuneration Committee. The
Board of Directors acting on the recommendation of the Remuneration Committee determined average ROE in the amount of
7% as a LTI target for performance period 2020-2022. Award payouts range from 0% to 200% of the target number of shares.
According to the Remuneration Policy maximum amount of remuneration related to the STI and LTI targets is 80% of the total
remuneration. It is expressed in proportion as fixed part to variable part 1:4 or, in other word, variable compensation amounts 4
fixed parts. As the STI part cannot exceed 150% of the fixed remuneration the ceiling for the LTI part is calculated in the following
way: (4 - 1.5) = 2.5 fixed parts or 250% of fixed remuneration. Thus, the maximum number of performance-related shares (200%
of the target number of shares) is determined by dividing of the amount of the LTI remuneration (250% of fixed salary) by the
actual share price. Once the performance period has ended, the Remuneration Committee assesses the extent to which the
targets have been met and what part of the shares should vest. The number of shares to vest is adjusted for dividends that have
been paid to shareholders over the three-year performance period. Executive Directors A are vested with the performance-related
shares only from the treasury shares without any additional issue. In total, the performance share plan covers five financial years,
as any vested shares must be retained by the relevant Directors for a further two financial years.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
88 89
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Number of performance-related shares
Plan
Perfor-
mance
period
Offer
date
Award
date
Vesting
Date
End of
holding
period
Share
balance at
January 1,
2021
Awarded
in 2021
Vested
in 2021
Share
balance at
December 31,
2021
Viktor
Ivanchyk
Executive
Director
A (Chief
Executive
Officer)
LTI
2020-
2022
2020-
2022
May
2020
May
2023*
May
2023
May
2025
- - - -
Viktor
Gladky
Executive
Director
A (Chief
Financial
Officer)
LTI
2020-
2022
2020-
2022
May
2020
May
2023*
May
2023
May
2025
- - - -
* Based on the actual performance as of 31 December 2021 the estimated potential maximum LTI awards amounted to 250% of fixed remuneration or to EUR900 thousand and
EUR 690 thousand for Mr.Ivanchyk and Mr. Gladky respectively.
The Company believes that the goals for the STI and LTI described above contribute to the achievement of the Company’s
strategic and long-term goals, and the Company’s long-term viability as a business, by allowing the Company to attract high-
caliber executives who share the Company’s long-term goals and values.
Comparative information on the remuneration and the Company performance over the last five financial years
In compliance with point (b), paragraph 1 of Article 9b of the EU Directive on long-term shareholder engagement and Art. 2:135b
of the Dutch Civil Code Astarta presents below: the annual change of remuneration of Executive Directors A, the performance of
the Company and the average remuneration on a full-time equivalent basis of the Company’s employees over at least five most
recent financial years.
Annual change
2017 vs
2016
2018 vs
2017
2019 vs
2018
2020 vs
2019
2021 vs
2020
Information
regarding 2021,
thsEUR
Total remuneration of Executive Directors A
Viktor Ivanchyk, Chief Executive Officer 31% -1% -50% 2% 106% 74 2
Viktor Gladky, Chief Financial Officer 43% -10% -51% -13% 113% 511
Total remuneration of Executive Directors B
Marc van Campen, Chief Corporate Officer 14% 9% -8% 0% 0% 40
Total remuneration of Non - Executive Directors
Howard A. Dahl, Chairman of the Board of Directors n.a. 7% -11% -6% 0% 75
Gilles Mettetal, Non-Executive Director n.a n.a -3% -9% 0% 40
Arslan Huseyin, Non-Executive Director n.a n.a n.a 0% 0% 40
Company performance
Net profit -25% -130% 109% 409% 1323% 122 491
EBITDA -21% -47% 23% 46% 78% 201 459
Average remuneration on a full-time equivalent basis of employees
Employees of the Company 0% 0% 0% 0% 0% -
Employees of the Group 42% 12% 19% 9% 15% 7,5
*Employees of the Company are only Directors
PAY RATIO
The pay ratio compares the total remuneration of the CEO against the average remuneration of Astarta’s employees, calculated
as an average of all employees as of December 31, 2021. In respect of 2021, the ratio is 98.9 (2020: 55.4). The pay ratio change
in the reported financial year was caused by the increase of the average remuneration of full - time employees from EUR6.5k
per year to EUR7.5k per year or by 15%. At the same time total remuneration of the CEO increased by 106%. LTI remuneration is
excluded from the pay ratio calculation.
LOANS AND GUARANTEES
The company does not grant loans, advance payments or guarantees to members of the Board of Directors or any family member
of such persons.
REMUNERATION POLICY
The Board of Directors has evaluated the Remuneration Policy. It has considered the input from stakeholders and the requirements
of the engagement EU Directive on the encouragement of long-term shareholder engagement (SRD II) and in accordance with
Art. 2:135b of the Dutch Civil Code. As a result, amended and restated Policy was approved at the AGM dated 28 May 2021. It
became effective from 1 January 2020 (retroactively). The Policy must be resubmitted to the general meeting of shareholders for
approval at the 2025 annual general meeting of shareholders. The Remuneration Report 2020 was submitted to the 2021 AGM
for its advisory vote, and the meeting unanimously approved the report.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
90 91
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
12 REPORT OF NON-EXECUTIVE DIRECTORS
The Non-Executive Directors of the Board of Directors, Mr. Dahl, Mr. Mettetal and Mr. Arslan have performed the following actions
and duties in their role as Non-Executive Directors in 2021.
The Non-Executive Directors are charged with supervising the policy, strategy and fulfilment of duties of the Executive Directors A
and the Executive Director B, and the general affairs of the Company.
Mr. Dahl, Mr. Mettetal and Mr. Arslan can be considered independent within the meaning of Best Practice Provision 5.1.1 of the
Dutch Corporate Governance Code.
In carrying out their task, they participated in the Board meetings mentioned in paragraph 5 above and advised the Board of
Directors on their management activities. Besides this, Mr. Dahl is the Chairman of the Remuneration Committee, and Mr.
Mettetal is the member of the Remuneration Committee and the Chairman of the Audit Committee.
In the 2021 financial year Mr. Dahl and Mr. Mettetal held meetings during which the main items discussed were – the remuneration
of the members of the Board of Directors, the short-term incentive targets (STI) for Executive directors A, payment of bonuses and
the Remuneration Policy of the Company.
As for Mr. Mettetal, as the Chairman of the Audit Committee, he held three meetings with Mr. Van Campen and provided the Board
of Directors with notification in this respect.
There were no irregularities in the 2021 financial year that required intervention by the Non-Executive Directors.
REPRESENTATIONS OF THE BOARD OF DIRECTORS
A. Representation of the Board of Directors on the Compliance of Annual Financial Statements
The Board of Directors hereby represents, to the best of its knowledge, that the statutory financial statements of the Company and
its consolidated subsidiaries for the year ended 31 December 2021 are prepared in accordance with the applicable accounting
standards and that they give a true and fair view of the assets, liabilities, financial position and the result of the Company and
its consolidated subsidiaries, and that the report of the Board of Directors for the year ended 31 December 2021 gives a true
and fair view of the position of the Company and its consolidated subsidiaries as at 31 December 2021 and of the development
and the performance of the Company and its consolidated subsidiaries during the year ended 31 December 2021, including a
description of the key risks that the Company is confronted with.
B. Representation of the Board of Directors on Appointment of an Entity Qualified to Audit Annual Financial Statements
The Board of Directors hereby represents that PricewaterhouseCoopers Accountants N.V. which performed the audit of the
statutory financial statements of the Company for the period that ended 31 December 2021, has been appointed in accordance
with the applicable laws and that this entity and the accountants performing the audit met the conditions necessary to issue an
impartial and independent report on the audit in accordance with the applicable provisions of law.
C. Representation of the Board of Directors Relating to the System of Internal Control
The System of internal controls maintains internal control framework, the compliance and includes updates regarding the
emergence of new risks.
We routinely work towards continuous improvement of our processes and procedures regarding financial reporting. In line with
the best practice provision 1.4.3 of the Dutch Corporate Governance Code, the Board of Directors states in the management
report with clear substantiation, that:
• the report provides sufficient insights into any failings in the effectiveness of the internal risk management and control
systems;
• the aforementioned systems provide reasonable assurance that the financial reporting does not contain any material
inaccuracies;
• based on the current state of affairs, it is justified that the financial reporting is prepared on a going concern basis; and
• the report states those material risks and uncertainties that are relevant to the expectation of the Company’s continuity for
the period of twelve months after the preparation of the report.
Board of Directors of Astarta Holding N.V.
06 April 2022
Amsterdam, the Netherlands
Mr. V.Ivanchyk (signed)
Mr. H.A. Dahl (signed)
Mr. V.Gladky (signed)
Mr. M.M.L.J. van Campen (signed)
Mr. G. Mettetal (signed)
Mr. H. Arslan (signed)
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
FINANCIAL
STATEMENTS
Consolidated financial statements 94
Company financial statements 177
INDEPENDENT AUDITOR’S REPORT 192
94 95
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021
(in thousands of Ukrainian hryvnias) Notes
31 December
2021
31 December
2020
31 December
2019
ASSETS
Non-current assets
Property, plant and equipment 5 6 149 558 6 780 822 7 779 761
Right-of-use assets 6 3 619 723 3 271 712 3 752 857
Investment property - 84 103 70 690
Intangible assets 21 613 35 872 35 378
Biological assets 7 856 658 830 893 792 939
Long-term receivables and prepayments 9 22 863 6 510 20 767
Deferred tax assets 6 929 7 732 25 095
Total non-current assets 10 677 344 11 017 644 12 477 487
Current assets
Inventories 8 7 020 675 3 733 947 5 117 473
Biological assets 7 1 281 360 745 222 425 624
Trade accounts receivable 9 663 074 466 513 607 870
Other accounts receivable and prepayments 9 1 344 237 853 779 1 032 787
Current income tax 3 410 9 730 12 551
Short-term cash deposits 6 878 4 986 18 318
Cash and cash equivalents 10 356 869 774 831 326 046
Non-current assets held for sale - 157 727 43 283
Total current assets 10 676 503 6 746 735 7 583 952
Total assets 21 353 847 17 764 379 20 061 439
EQUITY AND LIABILITIES
Equity 11
Share capital 1 663 1 663 1 663
Additional paid-in capital 369 798 369 798 369 798
Retained earnings 13 096 200 9 066 354 8 349 380
Revaluation surplus 1 521 501 1 926 064 2 482 363
Treasury shares (137 875) (119 260) (119 260)
Currency translation reserve 459 821 474 036 508 868
Total equity 15 311 108 11 718 655 11 592 812
Non-current liabilities
Loans and borrowings 12 644 890 1 218 613 15 608
Net assets attributable to non-controlling participants 12 852 24 586 24 909
Other long-term liabilities 5 855 4 094 4 093
Lease liability 6 2 850 501 2 522 108 2 731 803
Deferred tax liabilities 125 644 177 495 259 791
Total non-current liabilities 3 639 742 3 946 896 3 036 204
Current liabilities
Loans and borrowings 12 245 520 - 3 874 935
Current portion of long-term loans and borrowings 299 628 625 581 56 943
Trade accounts payable 235 060 149 949 158 145
Current portion of lease liability 6 1 022 921 898 493 953 127
Current income tax 78 590 25 762 45 886
Other liabilities and accounts payable 13 521 278 315 043 343 387
Liabilities classified as held for sale - 84 000 -
Total current liabilities 2 402 997 2 098 828 5 432 423
Total equity and liabilities 21 353 847 17 764 379 20 061 439
The notes on pages 106 to 176 are an integral part of these consolidated financial statements.
CONSOLIDATED FINANCIAL
STATEMENTS
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021
(in thousands of Euros) Notes
31 December
2021
31 December
2020
31 December
2019
ASSETS
Non-current assets
Property, plant and equipment 5 198 869 195 189 294 442
Right-of-use assets 6 117 058 94 178 142 035
Investment property - 2 421 2 675
Intangible assets 699 1 033 1 340
Biological assets 7 27 703 23 917 30 011
Long-term receivables and prepayments 9 739 187 786
Deferred tax assets 224 223 950
Total non-current assets 345 292 317 148 472 239
Current assets
Inventories 8 227 040 107 482 193 681
Biological assets 7 41 438 21 452 16 109
Trade accounts receivable 9 21 443 13 429 23 007
Other accounts receivable and prepayments 9 43 471 24 577 39 086
Current income tax 110 280 47 5
Short-term cash deposits 222 14 4 693
Cash and cash equivalents 10 11 541 22 304 12 340
Non-current assets held for sale - 4 540 1 638
Total current assets 345 265 194 208 287 029
Total assets 690 557 511 356 759 268
EQUITY AND LIABILITIES
Equity 11
Share capital 250 250 250
Additional paid-in capital 55 638 55 638 55 638
Retained earnings 650 995 521 311 492 290
Revaluation surplus 68 922 87 251 112 451
Treasury shares (6 103) (5 527) (5 527)
Currency translation reserve (274 560) (321 597) (216 347)
Total equity 495 142 337 326 438 755
Non-current liabilities
Loans and borrowings 12 20 855 35 078 591
Net assets attributable to non-controlling participants 416 708 94 3
Other long-term liabilities 189 118 15 5
Lease liability 6 92 182 72 600 103 391
Deferred tax liabilities 4 063 5 109 9 832
Total non-current liabilities 117 705 113 613 114 912
Current liabilities
Loans and borrowings 12 7 940 - 146 656
Current portion of long-term loans and borrowings 9 690 18 008 2 155
Trade accounts payable 7 602 4 316 5 985
Current portion of lease liability 6 33 080 25 864 36 073
Current income tax 2 541 74 2 1 736
Other liabilities and accounts payable 13 16 857 9 069 12 996
Liabilities classified as held for sale - 2 418 -
Total current liabilities 77 710 60 417 205 601
Total equity and liabilities 690 557 511 356 759 268
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
96 97
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Ukrainian hryvnias) Notes 2021 2020
Revenues 14 15 631 176 12 927 064
Cost of revenues 15 (13 206 756) (10 846 636)
Changes in fair value of biological assets and agricultural produce 4 655 507 1 664 254
Gross profit 7 079 927 3 744 682
Other operating income 103 916 49 297
General and administrative expense 16 (983 843) (700 304)
Selling and distribution expense 17 (993 473) (951 472)
Other operating expense 18 (323 466) (359 455)
Impairment of property, plant and equipment 5 - (55 034)
Profit from operations 4 883 061 1 727 714
Interest expense on lease liability 19 (671 724) (673 189)
Other finance costs 19 (141 401) (334 267)
Foreign currency exchange gain/(loss) 34 926 (527 750)
Finance income 19 12 133 10 754
Other income 81 375 81 569
Profit before tax 4 198 370 284 831
Income tax expense 20 (199 833) (18 433)
Net profit 3 998 537 266 398
Net profit attributable to:
Equity holders of the parent company 3 998 537 266 398
Weighted average basic and diluted shares outstanding (in thousands owf shares) 24 298 24 310
Basic and diluted earnings per share attributable to shareholders of the company
from continued operations (in Ukrainian hryvnias)
164,56 1 0,96
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Euros) Notes 2021 2020
Revenues 14 491 355 415 630
Cost of revenues 15 (415 958) (348 182)
Changes in fair value of biological assets and agricultural produce 143 835 54 084
Gross profit 219 232 121 532
Other operating income 3 212 1 600
General and administrative expense 16 (30 741) (22 795)
Selling and distribution expense 17 (31 475) (30 884)
Other operating expense 18 (10 155) (11 542)
Impairment of property, plant and equipment 5 - (1 633)
Profit from operations 150 073 56 278
Interest expense on lease liability 19 (20 814) (22 162)
Other finance costs 19 (4 290) (10 767)
Foreign currency exchange gain/(loss) 1 003 (17 134)
Finance income 19 368 346
Other income 2 433 2 648
Profit before tax 128 773 9 209
Income tax expense 20 (6 282) (598)
Net profit 122 491 8 611
Net profit attributable to:
Equity holders of the parent company 122 491 8 611
Weighted average basic and diluted shares outstanding (in thousands of shares) 24 298 24 310
Basic and diluted earnings per share attributable to shareholders of the company
from continued operations (in Euros)
5,04 0,35
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
98 99
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Ukrainian hryvnias) 2021 2020
Profit for the period 3 998 537 266 398
Other comprehensive income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Translation difference (14 215) (34 832)
Net other comprehensive income to be reclassified to profit or loss in subsequent
periods
(14 215) (34 832)
Other comprehensive income not to be reclassified to profit or loss in subsequent
periods:
Decrease of revaluation reserve 164 (119 041)
Income tax effect (25) 13 318
Net other comprehensive income not to be reclassified to profit or loss in subsequent
periods
1 39 (105 723)
Total other comprehensive income (14 076) (140 555)
Total comprehensive income 3 984 461 125 843
Attributable to:
Equity holders of the parent 3 984 461 125 843
Total comprehensive income for the year 3 984 461 125 843
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Euros) 2021 2020
Profit for the period 122 491 8 611
Other comprehensive income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Translation difference 47 037 (105 250)
Net other comprehensive income to be reclassified to profit or loss in subsequent
periods
47 037 (105 250)
Other comprehensive income not to be reclassified to profit or loss in subsequent
periods:
Decrease of revaluation reserve 5 (5 173)
Income tax effect (1) 383
Net other comprehensive income not to be reclassified to profit or loss in subsequent
periods
4 (4 790)
Total other comprehensive income 47 041 (110 040)
Total comprehensive income 169 532 (101 429)
Attributable to:
Equity holders of the parent 169 532 (101 429)
Total comprehensive income for the year 169 532 (101 429)
The notes on pages 106 to 176 are an integral part of these consolidated financial statements.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
100 101
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Ukrainian hryvnias) Notes 2021 2020
Operating activities
Profit before tax 4 198 370 284 831
Adjustments for:
Depreciation and amortization 5,6 1 659 822 1 709 791
Allowance for trade and other accounts receivable 9 10 986 23 727
Loss on disposal of property, plant and equipment 18 43 018 27 257
VAT written off 18 40 647 18 821
Interest income 19 (9 490) (7 227)
Other finance income 19 (2 643) (3 527)
Interest expense 19 98 107 234 775
Other finance costs 19 54 888 99 854
Interest expense on lease liability 6,19 671 724 673 189
Impairment of property, plant and equipment 5 - 55 034
Changes in fair value of biological assets and agricultural produce 7 (4 655 507) (1 664 254)
Disposal of revaluation in agricultural produce in the cost of revenues 15 2 785 993 1 349 313
Recovery of assets previously written off (74 890) (5 488)
Net profit attributable to non-controlling participants in limited liability company
subsidiaries
19 (11 594) (362)
Foreign exchange (gain)/loss (34 926) 527 750
Working capital adjustments:
(Increase)/decrease in inventories (2 129 315) 1 276 010
(Increase)/decrease in trade and other receivables (777 345) 403 980
Decrease in biological assets due to other changes 225 088 70 393
Decrease in trade and other payables (71 576) (187 868)
Income taxes paid (191 764) (72 275)
Cash flows provided by operating activities 1 829 593 4 813 724
Investing activities
Purchase of property, plant and equipment, intangible assets and other non-current
assets
(413 805) (457 115)
Proceeds from disposal of property, plant and equipment 30 813 17 255
Interest received 19 9 490 7 227
Disposal of subsidiaries 4 250 450 -
Cash deposits placement (5 623) (4 987)
Cash deposits withdrawal 3 707 17 750
Cash flows used in investing activities (124 968) (419 870)
Financing activities
Proceeds from loans and borrowings 12 2 649 200 2 517 098
Repayment of loans and borrowings 12 (3 234 986) (5 218 660)
Dividends paid (406 171) -
Purchase of treasury shares (18 615) -
Payment of lease liabilities 6 (324 012) (280 079)
Payment of interest on lease liabilities 6 (671 724) (673 189)
Interest paid (102 064) (255 408)
Cash flows used in financing activities (2 108 372) (3 910 238)
Net (decrease)/increase in cash and cash equivalents (403 747) 483 616
Cash and cash equivalents as at 1 January 774 831 326 046
Currency translation difference (14 215) (34 831)
Cash and cash equivalents as at 31 December 356 869 774 831
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Euros) Notes 2021 2020
Operating activities
Profit before tax 128 773 9 209
Adjustments for:
Depreciation and amortization 5,6 51 386 55 510
Allowance for trade and other accounts receivable 9 345 76 2
Loss on disposal of property, plant and equipment 18 1 351 87 5
VAT written off 18 1 276 604
Interest income 19 (288) (233)
Other finance income 19 (80) (113)
Interest expense 19 2 976 7 562
Other finance costs 19 1 666 3 217
Interest expense on lease liability 6,19 20 814 22 162
Impairment of property, plant and equipment 5 - 1 633
Changes in fair value of biological assets and agricultural produce 7 (143 835) (54 084)
Disposal of revaluation in agricultural produce in the cost of revenues 15 87 747 43 314
Recovery of assets previously written off (2 315) (1 78)
Net profit attributable to non-controlling participants in limited liability company subsidiaries 19 (352) (12)
Foreign exchange (gain)/loss (1 003) 17 134
Working capital adjustments:
(Increase)/decrease in inventories (65 921) 41 920
(Increase)/decrease in trade and other receivables (24 066) 13 116
Decrease in biological assets due to other changes 6 968 2 285
Decrease) in trade and other payables (2 216) (6 099)
Income taxes paid (5 937) (2 346)
Cash flows provided by operating activities 57 289 156 238
Investing activities
Purchase of property, plant and equipment, intangible assets and other non-current assets (12 811) (14 841)
Proceeds from disposal of property, plant and equipment 954 560
Interest received 19 288 233
Disposal of subsidiaries 4 7 611 -
Cash deposits placement (1 7 4) (162)
Cash deposits withdrawal 115 5 76
Cash flows used in investing activities (4 017) (13 634)
Financing activities
Proceeds from loans and borrowings 12 82 016 81 720
Repayment of loans and borrowings 12 (100 151) (169 430)
Dividends paid (12 155) -
Purchase of treasury shares (576) -
Payment of lease liabilities 6 (10 013) (8 787)
Payment of interest on lease liabilities 6 (20 814) (22 162)
Interest paid (3 160) (8 292)
Cash flows used in financing activities (64 853) (126 951)
Net (decrease)/increase in cash and cash equivalents (11 581) 15 653
Cash and cash equivalents as at 1 January 22 304 12 340
Currency translation difference 81 8 (5 689)
Cash and cash equivalents as at 31 December 11 541 22 304
The notes on pages 106 to 176 are an integral part of these consolidated financial statements.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
102 103
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
.CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2021
Attributable to equity holders of the parent company
(in thousands of Ukrainian hryvnias)
Share capital
Additional
paid-in capital
Retained
earnings
Revaluation
surplus
Treasury shares
Currency
translation reserve
Total equity
As at 31 December 2019 1 663 369 798 8 349 380 2 482 363 (119 260) 508 868 11 592 812
Net ґprofit - - 266 398 - - - 266 398
Decrease of revaluation reserve, net of tax - - - (105 684) - - (105 684)
Share of non-controlling participants in LLC in revaluation surplus, net of deferred tax - - - (39) - - (39)
Translation difference - - - - - (34 832) (34 832)
Total other comprehensive loss, net of tax - - - (105 723) - (34 832) (140 555)
Total comprehensive income/(loss) - - 266 398 (105 723) - (34 832) 125 843
Realisation of revaluation surplus, net of tax - - 450 576 (450 576) - - -
As at 31 December 2020 1 663 369 798 9 066 354 1 926 064 (119 260) 474 036 11 718 655
Net profit - - 3 998 537 - - - 3 998 537
Share of non-controlling participants in LLC in revaluation surplus, net of deferred tax - - - 1 39 - - 1 39
Translation difference - - - - - (14 215) (14 215)
Total other comprehensive income, net of tax - - - 1 39 - (14 215) (14 076)
Total comprehensive income - - 3 998 537 139 - (14 215) 3 984 461
Distribution of dividends - - (406 171) - - - (406 171)
Purchase of own shares - - - - (18 615) - (18 615)
Share-based incentive plans - - 32 778 - - - 32 778
Realisation of revaluation surplus, net of tax - - 404 702 (404 702) - - -
As at 31 December 2021 1 663 369 798 13 096 200 1 521 501 (137 875) 459 821 15 311 108
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
104 105
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2021
Attributable to equity holders of the parent company
(in thousands of Euros)
Share capital
Additional
paid-in capital
Retained
earnings
Revaluation surplus Treasury shares
Currency
translation reserve
Total equity
As at 31 December 2019 250 55 638 492 290 112 451 (5 527) (216 347) 438 755
Net profit
- - 8 611 - - - 8 611
Decrease of revaluation reserve, net of tax - - - (4 789) - - (4 789)
Share of non-controlling participants in LLC in revaluation surplus, net of deferred tax
- - - (1) - - (1)
Translation difference - - - - - (105 250) (105 250)
Total other comprehensive income, net of tax - - - (4 790) - (105 250) (110 040)
Total comprehensive income/(loss) - - 8 611 (4 790) - (105 250) (101 429)
Realisation of revaluation surplus, net of tax - - 20 410 (20 410) - - -
As at 31 December 2020 250 55 638 521 311 87 251 (5 527) (321 597) 337 326
Net profit - - 122 491 - - - 122 491
Share of non-controlling participants in LLC in revaluation surplus, net of deferred tax
- - - 4 - - 4
Translation difference - - - - - 47 037 47 037
Total other comprehensive income, net of tax - - - 4 - 47 037 47 041
Total comprehensive income
- - 122 491 4 - 47 037 169 532
Distribution of dividends - - (12 155) - - - (12 155)
Purchase of own shares - - - - (576) - (576)
Share-based incentive plans - - 1 015 - - - 1 015
Realisation of revaluation surplus, net of tax - - 18 333 (18 333) - - -
As at 31 December 2021 250 55 638 650 995 68 922 (6 103) (274 560) 495 142
The notes on pages 106 to 176 are an integral part of these consolidated financial statements
.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
106 107
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
1 BACKGROUND
Organisation and operations
These consolidated financial statements are prepared by Astarta Holding N.V. (the ”Company”), a Dutch public company
incorporated in Amsterdam, the Netherlands, on 9 June 2006 under the Dutch law.
The Company’s legal address is Jan van Goyenkade 8, 1075 HP Amsterdam, the Netherlands.
On 4 July 2006 the shareholders of the Company contributed their shares in the Cyprus based company Ancor Investments Ltd
to Astarta Holding N.V. After the contribution, Astarta Holding N.V. owns 100% of share capital of Ancor Investment Ltd.
Ancor Investments Ltd owns 99.99% of the capital of LLC ”Firm ”Astarta-Kyiv” (Astarta-Kyiv) registered in Ukraine, which in turn
controls a number of subsidiaries in Ukraine (hereinafter the Company and its subsidiaries are collectively referred to as the
”Group”).
On 16 August 2006 the Company’s shares were admitted for trading on the Warsaw Stock Exchange. The first quotation of the
shares on the Warsaw Stock Exchange took place on 17 August 2006.
The Group specializes in sugar production, crop growing, soybean processing and cattle farming. The croplands, sugar and
soybean processing plants and cattle operations are mainly located in the Poltava, Vinnytsia, Khmelnytsky, Chernihiv, Cherkasy
and Kharkiv oblasts (administrative regions) of Ukraine. The Group’s business is vertically integrated because sugar is produced
primarily using own-grown sugar beet.
The number of employees were presented as follows:
2021 2020
operating personnel 3 533 3 718
administrative personnel 982 1 005
sales personnel 285 270
non-operating personnel 20 31
Total number of employees 4 820 5 024
(a) Ukrainian business environment and the impact on the Group
(i) In 2021, Ukraine faced significant public debt repayments, which required mobilising substantial domestic and external
financing in an increasingly challenging financing environment for emerging markets.
The events which led to the annexation of Crimea by the Russian Federation in February 2014 and the conflict in the East of
Ukraine which started in spring 2014 has not been resolved to date. On 24 February 2022 Russian Federation started its military
invasion of Ukraine. As result the government has introduced a martial law across the country. The relationship between Ukraine
and the Russian Federation became very strained.
Under martial law the NBU has introduced some temporary restrictions that has impact on economic environment, such as
restriction of cross-border payments in foreign currency, fixing the official exchange rate for 24 February 2022, release of cash
from client accounts in foreign currency, suspending debit transactions from the accounts of residents of the state that has carried
out armed aggression against Ukraine. These measures aim to ensure the reliable and stable operation of Ukraine’s financial
system and facilitate the support for the Armed Forces of Ukraine, as well as the smooth operation of critical infrastructure.
In February 2022 inflation rate increased in annual terms up to 10.7%. Inflation pressures due to tensions over a military invasion
and then the actual Russian invasion of Ukraine on 24 February. As result food and fuel prices rose most rapidly due to excessive
demand and disruptions in supply chains. Together with disrupted logistical chains and higher production costs, stronger demand
from the population and a further increase in global energy prices impacts inflation rate in Ukraine.
On 9 March 2022, the International Monetary Fund has approved an additional financing for Ukraine under an emergency
support program known as the Rapid Financing Instrument (“RFI”) in amount of USD 1.4 billion. The funds disbursed under the
RFI program will help to finance priority expenditures of the government and support Ukraine’s balance of payments.
On 15 March 2022 the Verkhovna Rada of Ukraine has adopted the following tax till the end of martial law:
• Cancellation of excise duty on fuel and decrease in VAT rate for fuel import from 20% to 7%;
• Annual revenue limit for applying simplified taxation system and pay a single tax has increased from UAH 10mln up to UAH
10 billion and tax rate fixed at 2%, no limitation on employees quantity for large companies;
• Landowners are exempt from paying land tax and land rent in areas where fighting is taking place or temporarily occupied
territories, or littered with explosive objects (The list of such territories will be determined by the Cabinet of Ministers of
Ukraine), period of exemption is from March 2022 to December 31 of the year following the year in which the martial law will
be cancelled;
• Transactions on voluntary transfer of any inventory, provision of services to the Armed Forces of Ukraine and territorial
defense units are not taxed;
• Penalty for violating tax law is not charged;
• Amount of VAT paid on the value of purchased goods and services will be included in the tax credit on the basis of primary
documents due to the impossibility of registration of tax invoices in the Unified Register of Tax Invoices (“URTI”) (Registration
of tax invoices in URTI will be completed within six months after the abolition of martial law);
• Environmental tax on facilities located in areas where fighting took place or temporarily occupied territories was cancelled
for 2022;
In March 2022 the government has introduced a zero quota on export of mineral fertilizers, cattle, cattle meat, rye, buckwheat,
millet, sugar and table salt. Export of wheat, corn, chicken meat, eggs, sunflower oil are subject to licensing. Export of gas is
prohibited.
Due to Russia invasion of Ukraine all seaports are blocked and transportation of goods by Black and Azov seas is impossible.
Transportation of goods is performed by railway and trucks.
Further economic growth depends upon the resolving the Russia invasion of Ukraine and upon success of the Ukrainian
government in realization of new reforms and recovery strategy after stopping the invasion, cooperation with the international
funds.
Despite certain improvements in 2021, the ongoing political and economic uncertainties are difficult to predict due to Russia
military invasion of Ukrainian territory in February 2022 and they significantly affect the Ukrainian economy and the Company’s
business.
(ii) The Group is well diversified geographically with its main assets being located in in the Central part of Ukraine (Poltava region),
and Western part (Khmelnytskyi, Vinnytsya, Zhytomyr and Ternopil regions) with less than 1% of assets located in Northern
(Chernihiv region) and Eastern (Kharkiv region) parts. As at the date of these consolidated financial statements:
• the most intensive military actions are localized in the regions, where Astarta does not operate and, hence, does not have
significant assets;
• no critical assets preventing the Group to continue operations are damaged;
• no material assets are lost or located in the uncontrolled territories.
In March 2022 Astarta already started its spring planting campaign of sugar beets in Poltava, Khmelnytskyi and Vinnytsya
regions; shortly followed by other regions. All machinery and equipment went under the regular maintenance processes to get
ready for the start of the agricultural season. The Group plans to carry out its sowing campaign in similar volumes and period
as before in order to ensure food security of the country. The Group already accumulated in Ukraine almost all of the necessary
seeds, fertilizers and fuel for the sowing campaign in its warehouses in Ukraine. Half of the fertilizers for spring crops were already
implicated into the fields. Each agri subsidiary operates within its own storages of seeds, fuel, fertilizers located in the areas in
close proximity to the arable land plots.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
108 109
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The Group plans to commence its harvesting campaign of winter crops as usual in early July and continues till August. Depending
on the weather conditions and other factors it is possible to postpone the harvest for one-two weeks without major impact on
yields and quality. Procurement of fuel for harvesting season is already in process jointly with the Ministry of Agri and Food and
grain associations.
In 2022 the Group plans to operate all of its sugar plants at a capacity of 3% higher than in previous year. The soybean processing
plant operates at its normal crushing capacity.
The production cycle of sugar beets of 2020/21 agricultural season is completed; produced sugar is in stock as at 31 December
2021.
Apart from sugar, as at the reporting date the Group has stock of other inventory in its warehouses, like corn, soy and soy
products, wheat and sunflower, refer to Note 8. The Group partially sold its agricultural products in January-March 2022 to the
local buyers and on export. As at the date of these consolidated financial statements the Group still has significant balances of
inventory in good conditions. Currently, Astarta continues to sell its crops, sugar, milk, and soybean crushing products on the
domestic market. Given the second year of a sugar deficit on the local market and higher than budgeted price for sugar, the Group
believes that will positively affect 2022 financial results. While export by means of sea carriages temporarily is impossible due
to suspension of seaports operations, the Group intends to exercise export sales of wheat, corn and soy via railway. The Group
is already in the process of rearranging its usual delivery routes from southern to western regions. Due to temporary restrictions
on export of certain agricultural products, on 14 March 2022 Group obtain its first license on export of wheat, which it plans
to transport via Western border. Transportation routes in the Central and Western parts of Ukraine are not affected by military
actions.
Astarta is not trading with the entities in the Ukrainian, EU and US sanctions list or entities associated with the individuals under
those sanctions.
In-house agricultural and office IT solutions allow Astarta to maintain business processes remotely in current circumstances.
However, in case of any disruption of centralized systems, all Astarta’s subsidiaries can operate autonomously according to the
internal procedures and regulations.
The Ukrainian government takes various measures to support agricultural operations in Ukraine. The government has approved
a mechanism of state guarantees for the loans of small and medium-sized enterprises in the agri sector. The same mechanism
for bigger agro companies is in process of implementation and has been already discussed with banks and market players via
associations. It was already approved to decrease taxation of fuel supply to the territory of Ukraine. This action will allow further
supply of fuel to Ukraine.
As at 31 December 2021 the Group was in compliance with covenants on its loans. As at 17 March 2022 management also
prepared the forecast of covenants up until and covering Q1 2023. Based on this, management expects that the Group will
be able to meet the covenants for the upcoming 12 months from the date of these consolidated financial statements with
considerable headroom for the contracted ratios. In management’s view, the sustainability of headroom will be ensured through
the reduced level of external debts as well as positive operating results. Reduced level of external debt will be maintained through
the servicing of existing debt as intended in the initial loan schedules. Group repaid EUR 11 million of loans in January 2022 and
obtained a new tranche for EUR 11 million in March 2022.
As of the date of these consolidated financial statements, condition and safety of the Group’s assets are not significantly affected
by the current invasion by the Russian Federation and the operational, logistic processes were reassessed by the Group to ensure
continuity of its business, as described above. Management is taking appropriate actions to continuously revise its businesses
processes and practices and prepared a 12 months budget based the assumption of that the degree of intensity of military
actions in the regions where the Group’s assets are located and the area of Ukrainian territory currently invaded by the Russian
troops is not largely increased; the Group is able to carry out the sowing and harvesting campaigns; the railway infrastructure will
function and can be used as a way of executing export sales during the period of seaports closure; it will be possible to operate
sugar processing plans for the harvested sugar beet in 2022/23; the Group will be able to obtain export licenses for its certain
agricultural products.
2 BASIS OF PREPARATION
(a) Statement of compliance
These consolidated financial statements are prepared in accordance with International Financial Reporting Standards as adopted
by the European Union (IFRS-EU) and in accordance with the Title 9, Book 2 of the Netherlands Civil Code. The consolidated
financial statements were authorized by the Board of Directors on 06 April 2022.
(b) Going Concern
On 24 February 2022 Russia initiated a full-scale military invasion of Ukraine. This was followed up by the immediate enactment
of martial law by the Ukrainian President’s Decree approved by Verkhovna Rada of Ukraine and corresponding introduction of the
related temporary restrictions that impact the economic environment. Considering the above, Astarta has assessed the going
concern assumption based on which the financial statements have been prepared.
While the Group’s operations were not largely impacted so far and management prepared its 12 months budget based on the
known facts and events, 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.
Main specific risks factors include:
• Ability to negotiate with the banks and attract new credit limits (facilities) in Q3 2022, to finance operating activities of the
Group. This is contingent upon uncertainty related to availability and will of the banks to provide such new financing
• Ability to obtain cash from the banks available under the already approved, unused credit facilities granted to date or expected
to be obtained during the year. Because those facilities are not legally binding and depend, on the ability of banks (mainly
Ukrainian banks) to provide cash
• The safety of fixed assets and inventories (the assets), and access to logistic routs is highly contingent upon the development
of military activities. There is a significant uncertainty of whether the assets or routs of transportation might be damaged or
available and therefore or the Group would not be able to move its assets between locations, customers and suppliers. This
may result in additional costs or loss of revenues
In order to analyze the impact of these risks and support its ability to continue as a going concern, management has prepared
actualized financial forecast as of the end of March 2022 which shows that the ability of Group to operate as a going concern
would be dependent on the following significant assumptions:
• Banks have already approved most of the credit facilities required for the financing of Q1, Q2 and partially Q3 or the approval
is in pipeline with the banks. Management would be able to draw the cash from the approved credit facilities to finance
operating activities
• Management would be able to negotiate with the banks and attract additional credit facilities in Q3 2022. Historically
management maintained a fruitful relation with the banks and was able to attract new financing
• When preparing the actualized financial forecast, management has made the following adjustments to the initial financial
forecast, i.e.:
- decreased sales volume due to possible complications with altering the available routes of transportation, i.e. through
the western border instead of the ports of the Black Sea
- decreased costs due to postponement of large investment projects and removing the non-essential capital expenditures.
Based on these steps that management is taking, management concluded that it is appropriate to prepare the financial
statements on a going concern basis. However, due to the uncertain impact of the future development of the military invasion
on the above-mentioned significant assumptions underlying managements forecasts, management concludes that a material
uncertainty exists, 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..
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(c) Basis of consolidation
These consolidated financial statements have been prepared on a going concern basis which assumes the Group will be able to
realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.
The consolidated financial statements comprise the financial statements of the Group and its subsidiaries as at 31 December
2021. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and
has the ability to affect those returns through its power over the investee.
Specifically, the Group controls an investee if and only if the Group has:
• Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
• Exposure, or rights, to variable returns from its involvement with the investee, and
• The ability to use its power over the investee to affect its returns
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
• The contractual arrangement with the other vote holders of the investee
• Rights arising from other contractual arrangements
• The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or
more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary
and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or
disposed of during the year are included in the statement of comprehensive income from the date the Group gains control until
the date the Group ceases to control the subsidiary.
Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the parent of
the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. When
necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the
Group’s accounting policies.
If the Group loses control over a subsidiary, it:
• Derecognises the assets (including goodwill) and liabilities of the subsidiary
• Derecognises the cumulative translation differences recorded in equity
• Recognises the fair value of the consideration received
• Recognises the fair value of any investment retained
• Recognises any surplus or deficit in profit or loss
• Reclassifies the parent’s share of components previously recognised in OCI to profit or loss or retained earnings, as
appropriate, as would be required if the Group had directly disposed of the related assets or liabilities.
31 December
2021
31 December
2020
Name of Subsidiaries: Activity Place of business
% of
ownership
% of
ownership
Ancor Investments Ltd
Trade and investment
activities
Cyprus 100,00% 100,00%
LLC Firm “Astarta-Kyiv” Asset management Ukraine 99,99% 99,99%
LLC “APO “Tsukrovyk Poltavshchyny” Sugar production Ukraine 99,73% 99,73%
LLC “Agricultural company “Dovzhenko” Agricultural Ukraine 99,99% 99,99%
LLC “Astarta Agro Trade”**** Trade Ukraine 99,99% 90,57%
LLC “Agricultural company “Dobrobut” Agricultural Ukraine 99,99% 99,99%
LLC “Agricultural company “Musievske” Agricultural Ukraine 99,99% 99,99%
LLC “Globinskiy processing factory” Soybean processing Ukraine 99,99% 99,99%
LLC “Investment company “Poltavazernoproduct” Agricultural Ukraine 99,99% 99,99%
LLC “List-Ruchky” Agricultural Ukraine 74,99% 74,99%
LLC “Agropromgaz” Trade Ukraine 99,97% 99,97%
LLC “Khmilnitske” Agricultural Ukraine 99,99% 99,99%
LLC “Volochysk-Agro” Agricultural Ukraine 99,99% 99,99%
LLC “Agricultural company “Astarta Prykhorollia” Agricultural Ukraine 99,99% 99,99%
LLC “Agricultural company “Lan”* Agricultural Ukraine 0,00% 99,99%
LLC “Nika” Agricultural Ukraine 99,99% 99,99%
LLC “Zhytnytsya Podillya” Agricultural Ukraine 99,99% 97,00%
LLC “Astarta Service” Service Ukraine 99,99% 99,99%
LLC “Agrosvit Savyntsi”** Agricultural Ukraine 0,00% 99,99%
ALC “Novoivanivskiy sugar plant”** Sugar production Ukraine 0,00% 95,10%
LLC “Tsukragromprom” Sugar production Ukraine 99,99% 99,99%
LLC “Zerno-Agrotrade” Storage and trade Ukraine 99,99% 99,99%
LLC “Novoorzhytskiy sugar plant” Sugar production Ukraine 99,99% 99,99%
LLC “APK Savynska” Sugar production Ukraine 0,00% 0,00%
LLC “Globinskiy bioenergetichniy complex” Sugar production Ukraine 99,99% 99,99%
PE “TMG” Agricultural Ukraine 99,99% 99,99%
LLC “Eco Energy” Agricultural Ukraine 99,99% 99,99%
АLLC «Lyaschivka»** Agricultural Ukraine 0,00% 99,99%
LLC “Agri Chain”
Research and
development
Ukraine 99,99% 99,99%
ALC “Narkevitskiy sugar plant” Sugar production Ukraine 99,99% 99,99%
PJSC “Ukrainian Agro-Insurance Company” Insurance Ukraine 99,99% 99,99%
Astarta Trading GmbH Trade Switzerland 100,00% 100,00%
LLC «Pochayna-Office»** Asset management Ukraine 0,00% 99,99%
LLC “Astarta Invest Service”*** Land management Ukraine 99,99% 0,00%
LLC “Astarta Agro Protein”*** Soybean processing Ukraine 99,99% 0,00%
Place of business of all subsidiaries has not changed since previous year.
* LLC “Agricultural company “Lan” as at 31 December 2021 was liquidated.
** In February 2021 ALLC “Lyaschivka” and ALC “Novoivanivskiy sugar plant” were disposed to third party. In March 2021 LLC “Agrosvit Savyntsi” was disposed to third
party. In September 2021 LLC “Pochayna-Office” was disposed to third party.
*** In July 2021 LLC “Astarta Invest Service” was established. In October 2021 LLC “Astarta Agro Protein” was established.
**** In July 2021 LLC “Shyshaki combined forage factory” changed its legal name to LLC “Astarta Agro Trade” and its activity from fodder production to trade.
All subsidiaries, except for Ancor Investments Ltd and Astarta Trading GmbH, are incorporated in Ukraine. Ancor Investments Ltd
is incorporated in Cyprus, Astarta Trading GmbH is incorporated in Switzerland.
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(d) Business combinations and goodwill
Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate
of the consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the
acquire. For each business combination, the acquirer measures the non-controlling interest in the acquiree either at fair value
or at the proportionate share of the acquiree’s identifiable net assets. Acquisition costs incurred are expensed and included in
administrative expenses.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in
the acquiree is remeasured to fair value at the acquisition date through income statement. Goodwill is initially measured at cost
being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interest over
the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of
the subsidiary acquired, the difference is recognised in income statement.
(e) Basis of accounting
The consolidated financial statements are prepared on a historical cost basis, except for buildings and machines and equipment
classified as property, plant and equipment accounted under revaluation model, biological assets at fair value less estimated
costs to sell and agricultural produce stated at cost which is determined as fair value less estimated costs to sell at the point of
harvest.
(f) Transactions eliminated on consolidation
Intercompany balances and transactions, and any unrealized gains arising from intercompany transactions, are eliminated in
preparing the consolidated financial statements. Unrealized gains arising from transactions with associate are eliminated to
the extent of the Group’s interest in the enterprise. Unrealized gains resulting from transactions with associates are eliminated
against the investment in the associate. Unrealized losses are eliminated in the same way as unrealized gains except that they
are only eliminated to the extent that there is no evidence of impairment.
(g) Net assets attributable to non-controlling participants in limited liability companies
Substantially all of the Group’s subsidiaries are Ukrainian limited liability companies. Under Ukrainian law, a participant in a
limited liability company may unilaterally withdraw from the company. In such case, the company is obliged to pay the withdrawing
participant’s share of the net assets of the company not later than in 12 months from the date of the withdrawal. Since the
non-controlling participants in limited liability companies did not announce about their intentions to withdraw their interest, their
interest was recognized as a non-current liability. Limited liability company non-controlling interest share in the net profit/loss is
recorded as a finance expense.
(h) Functional and presentation currency
Each entity in the Group determines its own functional currency and items included in the separate financial statements of each
entity are measured using that functional currency. The functional currency of the Company and its Swiss and Cypriot subsidiaries
is Euro (EUR). The operating subsidiaries registered in Ukraine have the Ukrainian hryvnia (UAH) as their functional currency.
The consolidated financial statements are presented in UAH, which is primary presentation currency, and all values are rounded
to the nearest thousand, except when otherwise indicated. For the benefit of certain users, the Group also presents all numerical
information in EUR. The translation of UAH denominated assets and liabilities into EUR in these consolidated financial statements
does not necessarily mean that the Group could realize or settle in EUR the reported values of these assets and liabilities.
Likewise, it does not necessarily mean that the Group could return or distribute the reported EUR value retained earnings to its
shareholders. For the purposes of presenting financial information in EUR, assets and liabilities of the Ukrainian subsidiaries are
translated from UAH to EUR using the official closing rates at each reporting date. Income and expense items are translated at
the average exchange rates for the quarter, unless the exchange rates fluctuate significantly during that period, in which case the
exchange rates at the dates of the transactions are used. Disclosure line items are translated using annual weighted average
official exchange rate. For translation of UAH figures into EUR figures for the cash flow statement the Group uses average UAH/
EUR exchange rate. For the purposes of presenting financial information in UAH, assets and liabilities of the subsidiaries for which
functional currency in EUR are translated from EUR to UAH using the official closing rates at each reporting date and income and
expenses are translated at the official spot rates at the date of transaction.
Translation differences arising, if any, are recognized in other comprehensive income and accumulated in the Currency translation
reserve.
The principal Ukrainian Hryvnia (“UAH”) exchange rates used in the preparation of the consolidated financial statements are as
follows:
Currency Average reporting period rate Reporting date rate
2021 2020 31 December 2021 31 December 2020
EUR
32.30 30.80 30.92 34.74
USD 27.28 26.96 27.28 28.28
The average exchange rates for each period are calculated as the arithmetic mean of the exchange rates for all trading days
during this period. The sources of exchange rates are the official rates set by the National Bank of Ukraine.
All foreign exchange gain or loss that occurs on revaluation of monetary balances, presented in foreign currencies, is presented
as a separate line in the Consolidated Income Statement.
(i) Critical accounting estimates and judgements in applying accounting policies
The preparation of the consolidated financial statements requires management to make judgements, estimates and assumptions
that affect the application of policies and the reported amounts of assets, liabilities, income and expense and the disclosure
of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material
adjustment to the carrying amount of assets or liabilities affected in future periods. Estimates and judgements are continually
evaluated and are based on management’s experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. Management also makes certain judgements, apart from those involving
estimations, in the process of applying the accounting policies.
Other disclosures relating to the Group’s exposure to risks and uncertainties includes:
• Capital risk management Note 11
• Sensitivity analyses disclosures
- fair value of biological assets Note 7
- impairment of property, plant and equipment Note 5
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year,
are described below. The Group based its assumptions and estimates on parameters available when the consolidated financial
statements are prepared. Existing circumstances and assumptions about future developments, however, may change due to
market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when
they occur.
In the process of applying the Group’s accounting policies, management has made the following estimates, which have the most
significant effect on the amounts recognised in the consolidated financial statements.
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Impairment of property, plant and equipment
The Group and its subsidiaries are required to perform impairment tests for their assets or cash-generating units when there
is indication that an asset or a cash-generating unit (“CGU”) may be impaired. As at 31 December 2021 impairment test was
performed.
For the purpose of impairment testing, the Group identified four cash-generating units (CGUs): sugar, agricultural, soybean
processing and cattle. One of the determining factors in identifying a cash-generating unit is the ability to measure independent
cash flows for that unit. Within the Group’s identified cash-generating units a significant proportion of their output is input to
another cash-generating unit. Therefore, judgement is needed in determining a cash-generating unit.
Impairment testing is performed based on value-in-use calculation using the cash flow projection not exceeding the five-year
period. Cash flow projection is based on the next year budget approved by the Group’s Budget Committee, comprising CFO, CEO,
COO, Commercial Director and Production Director of the Group and for the subsequent years - on the extrapolated forecasts
based on the consumer price index and sugar price forecasts of World Bank.
The most recent detailed calculations of impairment for all segments were performed as of 31 December 2021, key assumptions
made and reasonably possible changes in these assumptions are disclosed in Note 5. Judgement is required to determine
principal assumptions made and the impact on the aggregate value-in-use calculation.
The impact of climate related risks on major assumption incorporated in forecasts and disclosures to relevant assets and
obligations remains uncertain and therefore our estimations were not adjusted accordingly. This will remain an area of increased
focus in the upcoming reporting period.
Fair value of biological assets
Due to the absence of an active market, the fair value of biological assets is estimated by present valuing the net cash flows
expected to be generated from the assets discounted at a current market-determined rate based on WACC with asset specific
adjustments. The fair value of biological assets is determined by the Group’s own agricultural, sales and financial reporting
experts based on production technological cards for each type of biological assets, next year budget approved by the Group’s
Budget Committee and future market prices and economic outlooks. Key estimates and assumptions involved in valuation apart
of discount rate are yield, prices for output to be harvested and remaining production costs for crops and milk yield, milk and
meat prices for cows of and their sensitivities are disclosed in Note 7. Fair valuation is made in accordance with IFRS 13 Fair
Value Measurement.
The Group’s business by nature is highly susceptible to weather conditions during planting and harvesting time as well as during
the time when crops are growing. Unexpected changes in weather conditions can impact the costs of production and the yields of
crops, used in estimating the fair value of the biological assets, and ultimately have a significant impact on the Group’s financial
results. The Group continuously monitors forecasts and is taking necessary actions to minimise impact.
Fair value of agricultural produce
Management estimates the fair value of agricultural produce by reference to quoted prices in an active market. Fair valuation is made
in accordance with IFRS 13 Fair Value Measurement. In addition, costs to sell at the point of harvest are estimated and deducted from
the fair value. The fair value less costs to sell becomes the carrying value of inventories at the date of harvesting. A 10% increase or
decrease in crops prices at 31 December 2021 would result in an increase or decrease in agriculture produce of UAH 262,43 thousand
(EUR 8,488 thousand) (31 December 2020: UAH 105,495 thousand (EUR 3,037 thousand). Potential increase or decrease in crops
price determined at the point of harvest for crops sold during the year does not impact the Group’s operating profit.
Lease liabilities
Management uses some estimates for land lease liabilities calculation:
• lease rate;
• discount rate;
• lease term.
The Group includes into lease payments used in measurement of land lease liability total amount of actual variable lease
payments that comprise lease rate that vary to reflect changes in market rent rates. The Group is exposed to potential future
increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect.
When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against
the right-of-use assets. A 10% increase or decrease in lease payments at 31 December 2021 would result in an increase or
decrease in lease liabilities of UAH 387,342 thousand (EUR 12,526 thousand), (31 December 2020: UAH 342,060 thousand
(EUR 9,846 thousand).
The lease payments are discounted using the incremental borrowing rate since the interest rate implicit in the lease could not be
determined. A 10% increase or decrease in discount rate at 31 December 2021 would result in an decrease or increase in lease
liabilities of UAH 199,518 thousand (EUR 6,452 thousand), (31 December 2020: UAH 187,763 thousand (EUR 5,405 thousand).
Extension and termination options are included in a number of leases across the Group. These terms are used to maximise
operational flexibility in terms of managing contracts. In determining the land lease term, management considers all facts and
circumstances that create an economic incentive to exercise an extension option. Extension option is considered exercisable by
the Group and is included in measurement of assets and liabilities arising from warehouse and office premises lease and lease
term for office premises considered as 15 years and for warehouses as 3 years as at each reporting date. For land lease the Group
considered extension option as not exercisable given long-term period of contracts best represents reasonably certain period of
lease supported by the past history of termination of the lease agreements and expected pattern of use for the land leases.
Depreciation
Management estimates are necessary to identify the useful lives of property, plant and equipment. Management assesses
the remaining useful lives in accordance with the current technical conditions of the assets and estimated period during which
the assets are expected to earn benefits for the Group. Were the estimated useful lives to differ by 10% from management’s
estimates, the impact on depreciation for the year ended 31 December 2021 would be to increase it by UAH 99,920 thousand
(EUR 2,876 thousand), (31 December 2020: UAH 119,349 thousand UAH (EUR 3,436 thousand) or decrease it by UAH 93,602
thousand (EUR 2,694 thousand), (31 December 2020: UAH 90,503 thousand (EUR 2,605 thousand).
We assessed the possible effects of climate change and consider, among others, physical risks, such as those associated with
water scarcity, flooding and weather events, as well as transitional risks that can lead to changes in technology, market dynamics
and regulations. In our view the resulting impact on the financial position, including underlying assumptions and estimates to be
not material and therefore our estimations were not adjusted for this impact. This will remain an area of increased focus in the
upcoming reporting period.
3 SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies are applied in the preparation of the consolidated financial statements
(a) Foreign currency transactions
Transactions in foreign currencies are translated to the functional currency of each entity at the official foreign exchange rate ruling
at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at reporting date are translated to
the functional currency at the foreign exchange rate ruling at that date. Non-monetary assets and liabilities denominated in foreign
currencies, which are stated at historical cost, are translated to the functional currency at the foreign exchange rate ruling at the
date of the transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at
the date when fair value is determined. Foreign exchange differences arising on translation are recognized in the income statement.
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(b) Property, plant and equipment
Owned assets
Buildings and constructions held for production, selling and distribution or administrative purposes, machinery and equipment are
stated at their revalued amounts, being the fair value at the date of revaluation, less any subsequent accumulated depreciation
and subsequent accumulated impairment losses, if any.
Buildings and constructions, machinery and equipment are subject to revaluation with sufficient regularity to ensure that the carrying
amount does not differ materially from that which would be determined using fair value at the end of the reporting period. Increases
in the carrying amount arising on revaluation are credited to other comprehensive income and increase the revaluation surplus in
equity. At the date of the revaluation accumulated depreciation is eliminated against the gross carrying amount of the asset and the
net amount restated to the revalued amount of the asset. The revaluations are carried out by independent appraisers.
A revaluation increase on property is recognized directly in other comprehensive income, except to the extent that it reverses
a previous impairment recognized in the income statement. A impairment of property is recognized in the income statement,
except to the extent that it reverses a previous revaluation increase recognized directly in equity.
An annual transfer from the asset revaluation reserve to retained earnings is made for the difference between depreciation
based on the revalued carrying amount of the assets and depreciation based on the asset’s original cost. Upon disposal, any
revaluation reserve relating to the buildings, and machinery and equipment being sold is transferred to retained earnings.
Vehicles and other items of property, plant and equipment are stated at cost, net of accumulated depreciation and/or impairment
losses, if any. The cost of an item of property, plant and equipment comprises (a) its purchase price, including import duties and
non-refundable purchase taxes, after deducting trade discounts and rebates; (b) any costs directly attributable to bringing the
item to the location and condition necessary for it to be capable of operating in the manner intended by the management of the
Group; (c) the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located. The
cost of self-constructed assets includes the cost of material, direct labour and an appropriate portion of production overheads.
Construction is a tripartite building that does not have a roof, a foundation or a wall. Constructions are mainly used in agriculture
and sugar production and are presented by hangars, silos, stockpile sites and grain dryings.
Not installed equipment comprises costs directly related to construction of property, plant and equipment including an appropriate
allocation of directly attributable variable overheads that are incurred in construction.
The gain or loss arising on a sale or disposal of an item of property, plant and equipment is determined as the difference between
the sales proceeds and the carrying amount of the asset and is recognized in the income statement.
Depreciation methods, useful lives and residual values are reviewed at each reporting date. The effect of any changes from
previous estimates is accounted for as a change in the accounting estimate.
Where an item of property, plant and equipment comprises major components having different useful lives, they are accounted
for as separate items of property, plant and equipment.
Subsequent expenditure
Expenditure incurred to replace a component of an item of property, plant and equipment that is accounted for separately, is
capitalized and the carrying amount of the component replaced is written off. Subsequent expenditure is capitalized only when
it increases the future economic benefits embodied in the item of property, plant and equipment. All other expenditures are
recognized in the income statement as expenses as incurred.
Depreciation
Depreciation of property, plant and equipment is charged to the income statement on a straight-line basis over the estimated
useful lives of the individual assets.
Depreciation commences when the item of property, plant and equipment is available for use. Land, assets under construction
and Not installed equipment are not depreciated.
The estimated initial useful lives are as follows
Buildings 50 years
Constructions 50 years
Machinery and equipment 20 years
Vehicles 10 years
Other property, plant and equipment 5 years
(c) Investment property
Investment property is initially and subsequently measured at cost less any accumulated depreciation and any accumulated
impairment losses.
Depreciation of investment property is charged to the income statement on a straight-line basis over the estimated useful lives
of the individual assets.
Investment property consists of buildings. The estimated useful life is 50 years.
(d) Intangible assets, other than goodwill
Intangible assets, which are acquired by the Group and which have finite useful lives, consist mainly from computer software.
Software is stated at cost less accumulated amortization and impairment losses. Amortization is charged to the income statement
in the expense category consistent with the function of intangible asset on a straight-line basis over the estimated useful lives,
normally 4 years.
The amortization period and the amortization method for intangible asset with a finite useful life are reviewed at least at each year end.
(e) Leases
The Group is a party to lease contracts as a lessee for, among others:
• land plots;
• building for office space and warehouses;
• equipment.
Leases are recognized, measured and presented in line with IFRS 16 Leases.
The Group recognizes assets and liabilities for all leases applying exceptions listed in the standard from 1 January 2018.
Contracts that were not identified as leases under IAS 17 and IFRIC 4 were not reassessed for whether there is lease. Therefore,
the definition of a lease under IFRS 16 was applied only to contracts entered into or changed on or after 1 January 2018.
The right-of-use assets are initially measured at cost, which comprises:
• the amount of the initial measurement of the lease liability;
• any lease payments made at or before the commencement date, less any lease incentives;
• any initial direct costs incurred by the lessee;
• an estimate of costs to be incurred by the lessee in dismantling and removing the underlying assets or restoring the site on
which the assets are located.
The commencement date is the date on which a lessor makes an underlying asset available for use by a lessee.
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After the commencement date the right-of-use assets are measured at cost less any accumulated depreciation and any
accumulated impairment losses and adjusted for any re-measurement of the lease liability. Right-of-use assets are generally
depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. If the Group is reasonably certain
to exercise a purchase option, the right-of-use assets is depreciated over the underlying assets’ useful lives. Depreciation on the
items of the right-of-use assets is calculated using the straight-line method over their estimated useful lives as follows:
Useful lives in years
Land 1 to 49
Buildings 1 to 15
Machinery 1 to 5
Motor vehicles 1 to 3
The lease term determined by the Group comprises:
• non-cancellable period of lease contracts;
• periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option;
• periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option.
The lease liability is initially measured at the present value of the lease payments that are not paid at that date. The lease
payments are discounted using the incremental borrowing rate as of the commencement date of the contract. Each lease
payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period.
Lease liabilities include the net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable, and
• variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the
commencement date.
The lease liability is measured subsequently at amortised cost using the effective interest method. It is remeasured when there
is a change in future lease payments arising from a change in an index or rate and when there is a change in the Group’s
assessment of whether it will exercise extension or termination option.
Each lease payment is allocated between the liability and interest expense on lease liability. Interest expense on lease liability is
charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the
liability for each period. The Group has applied the cost model to right-of-use assets. The right-of-use assets is depreciated over
the shorter of the asset’s useful life and the lease term on a straight-line basis. In addition, the right-of-use assets is periodically
reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use
assets, or is recorded in profit or loss if the carrying amount of the right-of-use assets has been reduced to zero.
Contracts may contain both lease and non-lease components. The Group allocates the consideration in the contract to the lease
and non-lease components based on their relative stand-alone prices.
The lease payments exclude variable elements which are dependent on internal and external factors such as e.g. energy usage,
motor-hours limits etc. Such variable lease payments are not included in the initial measurement of the lease liability are
recognized directly in the profit and loss.
The Group has elected not to recognize right-of-use assets and lease liabilities for short-term leases of machinery and other lease
that have a term of 12 months or less and leases of low-value assets. Payments associated with short-term leases of other assets
are recognised on a straight-line basis as an expense in profit or loss.
(f) Biological assets
The Group classifies livestock (primarily cattle) and unharvested crops as biological assets. Biological assets are carried at their
fair value less estimated costs to sell, except when the fair value cannot be measured reliably. If fair value cannot be measured
reliably, biological assets are carried at cost less accumulated depreciation and accumulated impairment losses. Costs to sell are
the incremental costs directly attributable to the disposal of an asset, excluding finance costs and income taxes.
Gain (loss) from changes in fair value of biological assets is included in the income statement line “Changes in fair value of
biological assets and agricultural produce”. The Group classifies biological assets as current or non-current depending upon the
average useful life of the particular group of biological assets.
(g) Agricultural produce
The Group classifies harvested crops as agricultural produce. Agricultural produce is carried in the statement of financial position
at lower of cost (equal to fair value at the point of harvest less cost to sell, which is considered to be the cost at that date) or net
realisable value. A gain or loss arising on initial recognition of agricultural produce at fair value less costs to sell is included in the
income statement line “Changes in fair value of biological assets and agricultural produce”.
(h) Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as financial assets subsequently measured at amortised cost (AC), fair value
through other comprehensive income (FVOCI) or fair value through profit or loss (FVTPL), as appropriate. All financial assets are
recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction
costs that are attributable to the acquisition of the financial asset. Fair value at initial recognition is best evidenced by the
transaction price.
Financial assets – classification and subsequent measurement – business model
The business model reflects how the Group manages the assets in order to generate cash flows – whether the Group’s objective
is: (i) solely to collect the contractual cash flows from the assets (“hold to collect contractual cash flows”) or (ii) to collect both the
contractual cash flows and the cash flows arising from the sale of assets (“hold to collect contractual cash flows and sell”) or, if
neither of (i) and (ii) is applicable, the financial assets are classified as part of “other” business model and measured at FVTPL.
Business model is determined for a group of assets (on a portfolio level) based on all relevant evidence about the activities that
the Group undertakes to achieve the objective set out for the portfolio available at the date of the assessment. Factors considered
by the Group in determining the business model include the purpose and composition of a portfolio, past experience on how
the cash flows for the respective assets were collected, how risks are assessed and managed, how the assets’ performance is
assessed and how managers are compensated.
Financial assets – classification and subsequent measurement – cash flow characteristics
Where the business model is to hold assets to collect contractual cash flows or to hold contractual cash flows and sell, the Group
assesses whether the cash flows represent solely payments of principal and interest (“SPPI”). Financial assets with embedded
derivatives are considered in their entirety when determining whether their cash flows are consistent with the SPPI feature. In
making this assessment, the Group considers whether the contractual cash flows are consistent with a basic lending arrangement,
i.e. interest includes only consideration for credit risk, time value of money, other basic lending risks and profit margin.
Where the contractual terms introduce exposure to risk or volatility that is inconsistent with a basic lending arrangement, the
financial asset is classified and measured at FVTPL. The SPPI assessment is performed on initial recognition of an asset and it
is not subsequently reassessed.
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Subsequent measurement
For purposes of subsequent measurement financial assets are classified as:
• Amortised cost (AC);
• Fair value through other comprehensive income (FVOCI);
• Fair value through profit or loss (FVTPL).
Financial assets subsequently measured at amortised cost
After initial recognition such financial assets are subsequently measured at amortized cost using the effective interest method,
less any impairment losses. After the initial recognition, an expected credit loss (“ECL”) allowance is recognised for financial assets
measured at AC, resulting in an immediate accounting loss. Financial assets of the Group that are subject to expected credit loss
model are represented by trade and other accounts receivable, short-term cash deposits and cash and cash equivalents. The
Group measures ECL and recognises net impairment losses on financial assets at each reporting date.
The Group does not have financial assets subsequently measured at FVOCI and at FVTPL as at 31 December 2021 and
31 December 2020.
Financial assets – derecognition
The Group derecognises financial assets when (a) the assets are redeemed or the rights to cash flows from the assets otherwise
expire or (b) the Group has transferred the rights to the cash flows from the financial assets or entered into a qualifying pass-
through arrangement whilst (i) also transferring substantially all the risks and rewards of ownership of the assets or (ii) neither
transferring nor retaining substantially all the risks and rewards of ownership but not retaining control.
Control is retained if the counterparty does not have the practical ability to sell the asset in its entirety to an unrelated third party
without needing to impose additional restrictions on the sale.
Financial liabilities – measurement categories
Financial liabilities are classified as subsequently measured at AC.
Financial liabilities – derecognition
Financial liabilities are derecognised when they are extinguished (i.e. when the obligation specified in the contract is discharged,
cancelled or expires).
(i) Fair value measurement principles
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the
asset or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability
The principal or the most advantageous market must be accessible to by the Group.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits
by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest
and best use. The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair
value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly
or indirectly observable
Level 3 Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether
transfers have occurred between Levels in the hierarchy by re-assessing categorization (based on the lowest level input that is
significant to the fair value measurement as a whole) at the end of each reporting period.
(j) Inventories
Inventories are stated at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary
course of business, less the estimated costs of completion and selling expenses. The cost of raw materials and finished goods
at the agricultural and sugar production facilities is determined using the weighted average method including costs incurred in
bringing them to their existing location and condition, such as transportation.
Work in progress and finished goods include the cost of raw materials, labour and manufacturing overheads allocated
proportionately to the stage of completion of the finished goods.
Investments into future crops represent fertilizers and land cultivation to prepare for the subsequent growing season. After
seeding the cost of field preparation is recognized as biological assets held at fair value less cost to sell.
(k) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and deposits with an original maturity date of three months or less and are
initially recognized at fair value and subsequently measured at amortized cost using the effective interest rate method, less any
impairment losses. For details refer to Note 3(h).
(l) Cash deposits
Cash deposits are held for the investment activities. For the purpose of the consolidated statement of cash flows, short-term
deposits are included in the investing activities.
(m) Non-current assets classified as held for sale
Non-current assets are classified in the consolidated statement of financial position as ‘non-current assets held for sale’ if their
carrying amount will be recovered principally through a sale transaction (including loss of control of a subsidiary holding the
assets) within twelve months after the reporting period. Assets are reclassified when all of the following conditions are met: (a)
the assets are available for immediate sale in their present condition; (b) the Group’s management approved and initiated an
active programme to locate a buyer; (c) the assets are actively marketed for sale at a reasonable price; (d) the sale is expected
within one year; and (e) it is unlikely that significant changes to the plan to sell will be made or that the plan will be withdrawn.
Non-current assets classified as held for sale in the current period’s consolidated statement of financial position are not
reclassified or re-presented in the comparative consolidated statement of financial position to reflect the classification at the end
of the current period.
Non-current assets 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.
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Liabilities directly associated with the disposal group that will be transferred in the disposal transaction are reclassified and
presented separately in the consolidated statement of financial position.
(n) Treasury shares
Own equity instruments that are reacquired (treasury shares) are recognised at cost and deducted from equity. No gain or loss is
recognised in profit or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments.
(o) Impairment
Financial assets
The Group measures ECL and recognises net impairment losses on financial assets at each reporting date. The Group applies
the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade
receivables. Lifetime ECL are the ECL that result from all possible default events over the expected life of a financial instrument.
The measurement of ECL reflects: (i) an unbiased and probability weighted amount that is determined by evaluating a range of
possible outcomes, (ii) time value of money and (iii) all reasonable and supportable information that is available without undue
cost and effort at the end of each reporting period about past events, current conditions and forecasts of future conditions.
At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit-impaired. A financial
asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the
financial asset have occurred.
Evidence that a financial asset is credit-impaired includes the following observable data:
• significant financial difficulty of the borrower or issuer;
• a breach of contract such as a default;
• it is probable that the borrower will enter bankruptcy.
Non-financial assets
The carrying amounts of non-financial assets, other than inventories, carried at cost less accumulated depreciation are reviewed
at each reporting date to determine whether there is any indication of impairment. If any such indication exists then the asset’s
recoverable amount is estimated.
An impairment loss is recognized if the carrying amount of an asset or cash-generating unit exceeds its recoverable amount. A
cash-generating unit is the smallest identifiable asset group that generates cash flows that largely are independent from other
assets and groups. Impairment losses are recognized in profit and loss. Impairment losses are recognized in respect of cash-
generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the
carrying amount of the other assets in the unit (group of units) on a pro rata basis.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
Further disclosures relating to impairment of non-financial assets are also provided in the following notes:
• Disclosures for significant assumptions Note 2 (i)
• Property, plant and equipment Note 4
Reversal of impairment of non-financial assets
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognized in prior periods
are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is
reversed if there is any indication that an impairment loss recognized in prior periods for an asset other than goodwill may no
longer exist or may be decreased and there has been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would
been determined, net of depreciation or amortization, if no impairment loss had been recognized.
(p) Earnings per share
Earnings per share are calculated by dividing net profit attributable to shareholders of the Company by the weighted average
number of shares outstanding during the period.
(q) Additional paid-in capital
The additional paid-in capital reserve relates to the excess of proceeds from the issuance of shares above the nominal value.
(r) Currency translation reserve
The currency translation reserve comprises all foreign exchange differences arising from the translation of the financial
statements denominated in functional currencies to presentation currencies. Currency translation difference is recognised in
other comprehensive income.
(s) Loans and borrowings
Loans and borrowings are recognized initially at fair value, net of any transaction costs incurred. Subsequent to initial recognition,
loans and borrowings are stated at amortized cost with any differences between cost and redemption value being recognized in
the income statement over the period of the borrowings using effective interest rate method.
When borrowings are repurchased or settled before maturity, any difference between the amount repaid and the carrying amount
is recognized immediately in the income statement.
(t) Trade accounts payable
Trade payables are accrued when the counterparty performs its obligations under the contract and are recognised initially at fair
value and subsequently carried at AC using the effective interest method.
(u) Taxes
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted, by the reporting date, in the countries where the Group operates and generates taxable income.
Current income tax relating to items recognised in other comprehensive income is recognised in the statement of other
comprehensive income and not in the income statement. Management periodically evaluates positions taken in the tax returns
with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where
appropriate.
The Group’s income was subject to taxation in Ukraine, Cyprus, Switzerland and the Netherlands. In 2021, Ukrainian corporate
income tax was levied at a rate of 18%. 16 subsidiaries of the Group are subject to CPT in Ukraine for the year ended 31
December 2021 (2020 – 21 subsidiaries).
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In 2021, the tax rates in Cyprus and the Netherlands were 12.5% and 25% (2020: 12,5% and 25%), respectively. For Switzerland
subsidiary tax rate is 12,5% (2020: 14,6%).
Deferred tax
Deferred tax is provided using the liability method on temporary differences at the reporting date between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
In respect of taxable temporary differences associated with investments in subsidiaries, where the timing of the reversal of the
temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax
losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry forward of unused tax credits and unused tax losses can be utilised except:
Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or
liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss;
In respect of deductible temporary differences associated with investments in subsidiaries, deferred tax assets are recognised
only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be
available against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised
deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that
future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised
or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Deferred tax relating to items recognised outside income statement is recognised outside income statement. Deferred tax items
are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against
current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
Fixed agricultural tax
In accordance with Tax Code of Ukraine, agricultural companies engaged in the production, processing and sale of agricultural
products might choose to be registered as payers of fixed agricultural tax (FAT), provided that their sales of agricultural goods of
their own production accounted for more than 75% of their gross revenues for the preceding year.
Fixed agricultural tax is paid in lieu of corporate income tax, land tax, duties for special use of water objects, municipal tax, vehicle
tax, duties for geological survey works and duties for trade patents. The amount of fixed agricultural tax payable is calculated as
a percentage of the deemed value of all land plots (determined by the state) leased or owned by a taxpayer. Fixed agricultural tax
is expensed as incurred.
Value added tax
Output value added tax related to sales is payable to tax authorities on the earlier of (a) collection of receivables from customers
or (b) delivery of goods or services to customers. Input VAT is generally recoverable against output VAT upon receipt of the VAT
invoice. The tax authorities permit the settlement of VAT on a net basis. VAT related to sales and purchases is recognised in the
consolidated statement of financial position on a gross basis and disclosed separately as an asset and a liability. Where provision
has been made for ECL of receivables, the impairment loss is recorded for the gross amount of the debtor, including VAT.
(v) Accounting for government grants
The Ukrainian legislation provides for a number of different grants and tax benefits for companies involved in agricultural
operations. There are grants and benefits established by Verkhovna Rada (the Parliament) as well as by the Ministry of Agrarian
Policy, the Ministry of Finance, the State Committee of Water Industry, the customs authorities and local district administrations.
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions
will be complied with. Government grants are recognised as income on a systematic basis over the periods that the related costs,
which they are intended to compensate, are expensed. To the extent the conditions attached to the grants are not met at the
reporting date, the received funds are recorded in the Group’s consolidated financial statements as deferred income.
Government grants related to crop production and cattle farming
According to the Law of Ukraine On Agricultural Support, all agricultural producers that apply for the subsidy must be included
in the State Registry of Budget Subsidy Recipients. An agricultural producer is defined as a farm or a company that derived 75
percent of its sales over the last 12 reporting periods (months) from sales of agricultural products.
The list of subsidized agricultural products of the Group includes: sugar beet, milk and meat.
Partial compensation for finance costs and other subsidies
The Group is entitled to receive reimbursement from various government programs for the cost of agricultural machinery
manufactured in Ukraine and fertilizers produced in Ukraine. Agricultural producers are required to meet certain conditions to
qualify for these subsidies.
Because interest and other subsidies are payable only when the governmental budget allows, they are recognized on a cash
basis, and are reflected in other operating income.
(w) Revenue
Revenue is income arising in the course of the Group’s ordinary activities. Revenue from sales of goods is 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.
Revenue from contracts with customers is recognised in the amount of transaction price net of discounts, returns and value
added taxes, export duties, other similar mandatory payments. 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. The Group does not expect to have any contracts where the period between the
transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence,
the Group does not adjust any of the transaction prices for the time value of money.
Generally sales are made with a credit term, 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 9).
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).
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(x) Interest income
For all financial instruments measured at amortised cost interest income is recorded using the effective interest rate (EIR)
method. The EIR is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial
instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset. Interest income is included
in finance income in the statement of profit or loss.
(y) Expenses
Expenses are accounted for on an accrual basis.
(z) Finance cost and income
Finance costs comprise interest expenses on loans and borrowings and foreign exchange difference. All interest and other costs
incurred in connection with borrowings are expensed using the effective interest method.
Finance income comprises mostly interest income on bank deposits. Interest income is recognized using the effective interest
rate method.
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial
period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are
expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection
with the borrowing of funds. The Group does not apply IAS 23 Borrowing Costs to borrowing costs directly attributable to the
acquisition, construction or production of a qualifying asset measured (will be measured) at fair value:
• biological asset within the scope of IAS 41 Agriculture;
• inventories that are manufactured, or otherwise produced, in large quantities on a repetitive basis.
(aa) Offsetting
Financial assets and liabilities are offset and the net amount is reported in the consolidated financial statements only when there
is a legally enforceable right to offset the recognized amounts, and there is an intention to either settle on a net basis, or to realize
the asset and settle the liability simultaneously.
(bb) Statement of cash flows
The statement of cash flows is prepared using the indirect method. Changes in statement of financial position items that have not
resulted in cash flows such as translation differences, fair value changes, etc., have been eliminated for the purpose of preparing
this statement. Assets and liabilities acquired as part of a business combination are included in investing activities (net of
cash acquired). Dividends paid to ordinary shareholders are included in financing activities. Dividends received are classified as
investing activities. Interest paid is included in financing activities. Interest received is included in investing activities. Payments
on lease liabilities – interest and principal part are included to finance activity.
(cc) Change in presentation
In order to provide users of the consolidated financials statements with more relevant information in respect of cash-related
changes in working capital, gain on agricultural produce remeasurement recognised according to IAS 41 Agriculture was
excluded from the line «(Increase)/decrease in inventories» in Cash Flow statement and included into separate line – “Disposal of
revaluation in agricultural produce in the cost of revenues” with respective changes in total «non-cash adjustments» and «Working
capital adjustments“.
(dd) New and amended standards and interpretations adopted
The following amended standards became effective from 1 January 2021, but did not have any material impact on the Group:
• Interest rate benchmark (IBOR) reform – phase 2 amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 (issued on 27
August 2020 and effective for annual periods beginning on or after 1 January 2021).
• Covid-19-Related Rent Concessions – Amendments to IFRS 16 (issued on 31 March 2021 and effective for annual periods
beginning on or after 1 April 2021).
(ee) New and amended standards and interpretations not yet adopted
The Group has not adopted the following new standards and amendments to standards, including any conse-
quential amendments to other standards, with a date of initial application of 1 January 2022:
Effective for annual period beginning on or after in EU
International Financial Reporting Standards (“IFRS”)
• IFRS 17 Insurance Contracts not yet endorsed
Amendments to existing standards and interpretations
• Classification of liabilities as current or non-current – Amendments to IAS 1 (issued on 23 January 2020
and effective for annual periods beginning on or after 1 January 2022)
1 January 2022
• Classification of liabilities as current or non-current, deferral of effective date – Amendments to IAS
1 (issued on 15 July 2020 and effective for annual periods beginning on or after 1 January 2023).
not yet endorsed
• Proceeds before intended use, Onerous contracts – cost of fulfilling a contract, Reference to the Conceptual
Framework – narrow scope amendments to IAS 16, IAS 37 and IFRS 3, and Annual Improvements to
IFRSs 2018-2020 – amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41 (issued on 14 May 2020 and
effective for annual periods beginning on or after 1 January 2022).
1 January 2022
• Amendments to IFRS 17 and an amendment to IFRS 4 (issued on 25 June 2020 and effective for annual
periods beginning on or after 1 January 2023).
not yet endorsed
• Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure of Accounting policies (issued on
12 February 2021 and effective for annual periods beginning on or after 1 January 2023).
not yet endorsed
• Amendments to IAS 8: Definition of Accounting Estimates (issued on 12 February 2021 and effective for
annual periods beginning on or after 1 January 2023).
not yet endorsed
• Deferred tax related to assets and liabilities arising from a single transaction – Amendments to IAS
12 (issued on 7 May 2021 and effective for annual periods beginning on or after 1 January 2023).
not yet endorsed
Unless otherwise described above, the new standards and interpretations are not expected to affect significantly the Group’s
consolidated financial statements.
4 DISCONTINUED OPERATIONS
In December 2020, management committed to sell ALC “Novoivanivskiy sugar plant”, which constitutes a part of the Sugar
production segment and АLLC “Lyaschivka”, which constitutes a part of the Agriculture segment. As at 31 December 2020,
management had also plans to sell LLC “Agrosvit Savyntsi”, which constitutes a part of the Agriculture segment.
Mainly, efforts to sell these assets have been started during the financial year 2020 and accordingly, these facilities are presented
as disposal groups held for sale as at 31 December 2020.
In February 2021 the Group has transferred control over 100% shares in LLC “Lyaschivka” for consideration of UAH 91,611 thousand or
EUR 2,836 thousand. The excess of consideration received over the net assets disposed amounting to UAH 69,785 thousand or EUR
2,161 thousand is recognised in the income statement as a gain on disposal of subsidiaries.
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In February 2021 the Group disposed 95% shares in ALC “Novoivanivskiy sugar plant” for consideration received of UAH 28,500
thousand or EUR 882 thousand. The excess of the net assets disposed over consideration received amounting to UAH 3,792
thousand or EUR 118 thousand is recognised in the income statement as a loss on disposal of subsidiaries.
In March 2021 the Group disposed 100% shares in LLC “Agrosvit Savyntsi” for consideration received of UAH 63,845 thousand
or EUR 1,977 thousand. The excess of consideration received over the net assets disposed amounting to UAH 52,692 thousand
or EUR 1,631 thousand is recognised in the income statement as a gain on disposal of subsidiaries.
In September 2021 the Group disposed 100% shares in LLC “Pochayna-Office” for consideration received of UAH 66,531
thousand or EUR 2,060 thousand. The excess of the net assets disposed over consideration received amounting to UAH 17,434
thousand or EUR 540 thousand is recognised in the income statement as a loss on disposal of subsidiaries.
The carrying amounts of assets and liabilities as at the date of sale were as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
LLC
“Lyaschivka”
ALC
“Novoivanivskiy
sugar plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochayna-
Office”
LLC
“Lyaschivka”
ALC
“Novoivanivskiy
sugar plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochana
Office”
Property, plant and
equipment
12 395 27 136 563 66 384 840 17 2
Investment
property
- - - 97 478 - - - 3 018
Right-of-use assets
39 346 13 200 21 465 663 1 218 409 665 21
Deferred tax
assets
- - - 232 - - - 7
Inventories 10 713 2 032 13 525 - 332 63 419 -
Trade accounts
receivables
- 1 299 - - - 40 - -
Other accounts
receivable and
prepayments
108 3 411 589 21 472 3 106 18 665
Cash and cash
equivalents
8 1 1 27 - - - 1
Total assets 62 570 47 079 36 143 119 938 1 937 1 458 1 119 3 714
Other long-term
liabilities
19 - - - 1 - - -
Lease liability 31 416 11 278 16 544 550 973 349 512 17
Trade accounts
payable
4 - - 12 - - - -
Current portion of
lease liability
9 098 2 553 8 443 116 282 79 261 4
Other liabilities
and accounts
payable
207 956 3 35 295 6 30 - 1 093
Total liabilities 40 744 14 787 24 990 35 973 1 262 458 773 1 114
Net assets 21 826 32 292 11 153 83 965 675 1 000 346 2 600
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
LLC
“Lyaschivka”
ALC
“Novoivanivs-
kiy sugar
plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochayna-
Office”
LLC
“Lyaschiv-
ka”
ALC
“Novoivanivs-
kiy sugar
plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochana
Office”
Consideration received
or receivable:
Cash received 91 611 28 500 63 845 66 531 2 836 882 1 977 2 060
Total disposal
consideration
91 611 28 500 63 845 66 531 2 836 882 1 977 2 060
Carrying amount of
net assets sold
21 826 32 292 11 153 83 965 675 1 000 346 2 600
Gain/(loss) on sale
of subsidiaries
69 785 (3 792) 52 692 (17 434) 2 161 (118) 1 631 (540)
The net cash flows generated from the sale of subsidiaries are, as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
LLC
“Lyaschivka”
ALC
“Novoivanivs-
kiy sugar
plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochayna- Of-
fice”
LLC
“Lyaschivka”
ALC
“Novoivanivskiy
sugar
plant”
LLC
“Agrosvit
Savyntsi”
LLC
“Pochana
Office”
Cash received
from sale of the
subsidiaries
91 611 28 500 63 845 66 531 2 836 882 1 977 2 060
Cash sold
as a part of
subsidiaries
(8) (1) (1) (27) - - - (1)
Net cash inflow
from disposal
91 603 28 499 63 844 66 504 2 836 882 1 977 2 059
As subsidiaries were sold prior to 31 December 2021, the assets and liabilities classified as held for sale are no longer included
in the statement of financial position.
The following assets and liabilities were reclassified as held for sale in relation to the discontinued operation as at 31 December 2021:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
31 December 2021 31 December 2020 31 December 2021 31 December 2020
ALC “Novoivanivskiy sugar plant” - 49 493 - 1 425
АLLC “Lyaschivka” - 63 821 - 1 837
LLC “Agrosvit Savyntsi” - 44 413 - 1 278
Non-current assets held for sale - 157 727 - 4 540
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
31 December 2021 31 December 2020 31 December 2021 31 December 2020
ALC “Novoivanivskiy sugar plant” - 15 066 - 434
АLLC “Lyaschivka” - 43 643 - 1 256
LLC “Agrosvit Savyntsi” - 25 291 - 728
Liabilities classified as held for sale - 84 000 - 2 418
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
130 131
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
5 PROPERTY, PLANT AND EQUIPMENT
The movements of property, plant and equipment in 2021 are as follows:
(in thousands of Ukrainian
hryvnias) Buildings
Construc-
tions
Machines
and
equipment Vehicles
Other
property,
plant and
equipment
Not
installed
equipment Total
Cost or valuation
1 January 2021
1 771 515 2 553 358 4 282 105 188 073 176 078 91 243 9 062 372
Additions - - - - - 496 872 496 872
Disposals (28 656) (17 408) (131 606) (5 201) (4 556) - (187 427)
Transfer from not installed
equipment
38 789 24 277 271 236 86 353 10 591 (431 246) -
31 December 2021 1 781 648 2 560 227 4 421 735 269 225 182 113 156 869 9 371 817
Accumulated depreciation
1 January 2021
221 365 296 174 1 538 817 103 438 121 756 - 2 281 550
Depreciation charge 97 642 132 889 754 381 34 549 25 275 - 1 044 736
Disposals (5 003) (5 722) (84 973) (4 355) (3 974) - (104 027)
31 December 2021 314 004 423 341 2 208 225 133 632 143 057 - 3 222 259
Net book value
31 December 2021
1 467 644 2 136 886 2 213 510 135 593 39 056 156 869 6 149 558
(in thousands of Euros) Buildings
Construc-
tions
Machines
and
equipment Vehicles
Other
property,
plant and
equipment
Not
installed
equipment Total
Cost or valuation
1 January 2021 50 994 73 500 123 264 5 414 5 067 2 626 260 865
Additions
- - - - - 15 383 15 383
Disposals (887) (539) (4 074) (161) (141) - (5 802)
Transfer from not installed
equipment 1 201 752 8 397 2 673 328 (13 351) -
Currency translation
difference 6 308 9 082 15 407 780 635 415 32 627
31 December 2021 57 616 82 795 142 994 8 706 5 889 5 073 303 073
Accumulated depreciation
1 January 2021 6 372 8 526 44 296 2 977 3 505 - 65 676
Depreciation charge 3 023 4 114 23 355 1 070 782 - 32 344
Disposals (155) (177) (2 631) (135) (123) - (3 221)
Currency translation
difference 915 1 227 6 392 409 462 - 9 405
31 December 2021 10 155 13 690 71 412 4 321 4 626 - 104 204
Net book value
31 December 2021
47 461 69 105 71 582 4 385 1 263 5 073 198 869
The movements of property, plant and equipment in 2020 are as follows:
(in thousands of Ukrainian hryvnias) Buildings
Construc-
tions
Machines
and
equipment Vehicles
Other
property,
plant and
equipment
Not
installed
equipment Total
Cost or valuation
1 January 2020
1 892 856 2 588 863 4 117 014 139 222 168 213 148 786 9 054 954
Additions - - - - - 412 297 412 297
Disposals (29 306) (25 183) (104 239) (3 023) (4 256) - (166 007)
Impairment (11 147) (17 966) (25 921) - - - (55 034)
Decrease in revaluation reserve (73 902) (12 864) (32 275) - - - (119 041)
Elimination of depreciation (8 892) (10 729) (53 720) - - - (73 341)
Transfer from not installed equipment 26 165 41 773 322 634 49 630 13 619 (453 821) -
Transfer to non-current assets held for
sale
(24 259) (10 536) (11 014) (1 418) (1 538) (680) (49 445)
Transfer to/from lease - - 69 626 3 662 40 - 73 328
Transfer to Investment property - - - - - (15 339) (15 339)
31 December 2020 1 771 515 2 553 358 4 282 105 188 073 176 078 91 243 9 062 372
Accumulated depreciation
1 January 2020
128 765 171 880 796 613 78 786 99 149 - 1 275 193
Depreciation charge 107 639 145 710 811 426 24 877 27 865 - 1 117 517
Disposals (4 321) (9 425) (33 667) (2 473) (3 889) - (53 775)
Decrease due to elimination of
depreciation
(8 892) (10 729) (53 720) - - - (73 341)
Decrease due to transfer to non-
current assets held for sale
(1 826) (1 262) (1 105) (1 094) (1 409) - (6 696)
Change due to transfer to/from lease - - 19 270 3 342 40 - 22 652
31 December 2020 221 365 296 174 1 538 817 103 438 121 756 - 2 281 550
Net book value
31 December 2020
1 550 150 2 257 184 2 743 288 84 635 54 322 91 243 6 780 822
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
132 133
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
(in thousands of Euros) Buildings
Construc-
tions
Machines
and
equipment Vehicles
Other
property,
plant and
equipment
Not
installed
equipment Total
Cost or valuation
1 January 2020
71 639 97 981 155 818 5 269 6 366 5 632 342 705
Additions - - - - - 13 386 13 386
Disposals (951) (818) (3 384) (98) (138) - (5 389)
Impairment (331) (533) (769) - - - (1 633)
Decrease in revaluation reserve (3 211) (559) (1 403) - - - (5 173)
Elimination of depreciation (256) (309) (1 546) - - - (2 111)
Transfer from not installed
equipment
849 1 356 10 475 1 611 442 (14 733) -
Transfer to non-current assets held
for sale
(698) (303) (317) (41) (44) (20) (1 423)
Transfer to/from lease - - 2 260 119 1 - 2 380
Currency translation difference (16 047) (23 315) (37 870) (1 446) (1 560) (1 141) (81 379)
Transfer to Investment property - - - - - (498) (498)
31 December 2020 50 994 73 500 123 264 5 414 5 067 2 626 260 865
Accumulated depreciation
1 January 2020
4 873 6 505 30 150 2 982 3 753 - 48 263
Depreciation charge 3 495 4 731 26 344 808 905 - 36 283
Disposals (140) (306) (1 093) (80) (126) - (1 745)
Decrease due to elimination of
depreciation
(256) (309) (1 546) - - - (2 111)
Decrease due to transfer to non-
current assets held for sale
(53) (36) (32) (31) (41) - (193)
Change due to transfer
to/from lease
- - 626 109 1 - 736
Currency translation difference (1 547) (2 059) (10 153) (811) (987) - (15 557)
31 December 2020 6 372 8 526 44 296 2 977 3 505 - 65 676
Net book value
31 December 2020
44 622 64 974 78 968 2 437 1 562 2 626 195 189
Impairment test – Assumptions and their sensitivity
The key assumptions used for impairment testing are: discount rates, selling prices and cost of production. Discount rates were
estimated based on weighted average cost of capital and comprised:
• Sugar CGU: 17.4% p.a. for five year period and 12.6% in the terminal period;
• Agricultural CGU: 17.6% p.a. for five year period and 12.8% in the terminal period;
• Soybean processing CGU: 17.4% p.a. for five year period and 12.6% in the terminal period;
• Cattle CGU: 17.6% p.a. for five year period and 12.8% in the terminal period.
• The discount rates in the terminal period are real discount rates (i.e. excluding the impact of inflation).
Production volume was estimated based on current production level according to the annual budget approved by senior
management. Potential increase in land, crop yields, number of cows or milk yields is not taken into account. Cost of production
was estimated based on budgeted costs for next year inflated by expected level of inflation, taking into account higher or lower
inflation levels for costs directly or indirectly pegged to USD or specific indexes. When determining selling prices the Group
analysed available forecasts for export and domestic markets, including forecasted supply and demand and legislative restrictions
on export sales. The following selling prices were used:
• Wheat – UAH 7,082 – UAH 7,656 per ton (EUR 223 - EUR 224)
• Corn – UAH 6,074– UAH 6,545 per ton (EUR 191 - EUR 192)
• Soybeans – UAH 14,426 – UAH 14,753 per ton (EUR 454– EUR 430)
• Soybean oil - UAH 36,367 – UAH 42,606 per ton (EUR 1,143 – EUR 1,242)
• Milk – UAH 12,887 – UAH 15,196 per ton (EUR 405 – EUR 443)
• Sugar – UAH 19,167 – UAH 23,275 per ton (EUR 603 – EUR 680)
For each CGU the identified recoverable determined with value-in-use model amount exceeded its carrying value as at
31 December 2021. The sensitivity analysis disclosed below consider impact reasonably possible changes in key assumptions
on carrying value of property, plant and equipment at the end of the reporting period. The sensitivity analysis is based on a
change in a significant assumption, keeping all other assumptions constant. The sensitivity analysis may not be representative of
an actual change on carrying value of property, plant and equipment of as it is unlikely that changes in assumptions would occur
in isolation of one another.
Decrease in carrying value of property, plant and equipment and respective impairment and/or decrease of revaluation reverse:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
Sugar Agriculture Cattle
Soybean
processing Sugar Agriculture Cattle
Soybean
processing
Increase in discount rate by 1% - - 56 127 - - - 1 815 -
Decrease in price by 10% - 3 680 095 315 645 212 464 - 119 010 10 208 6 871
Increase in cost by 10% - 3 680 095 315 645 - - 119 010 10 208 -
Impairment test conducted as at 31 December 2021 indicated that in the sugar segment recoverable amount is UAH 4,282,530
thousand or EUR 138,492 thousand and exceeds its total carrying amount by UAH 2,887,966 thousand or EUR 93,393 thousand,
in the agriculture segment recoverable amount is UAH 4,203,632 thousand or EUR 135,940 thousand and exceeds its total
carrying amount by UAH 452,125 thousand or EUR 14,621 thousand, in the cattle segment recoverable amount is UAH 1,232,743
thousand or EUR 39,865 thousand and exceeds its total carrying amount by UAH 53,441 thousand or EUR 1,728 thousand, and
the soybean-processing segment recoverable amount is UAH 3,139,475 thousand or EUR 101,527 thousand and exceeds its
total carrying amount by UAH 2,556,160 thousand or EUR 82,663 thousand.
Other matters
As at 31 December 2021, the carrying amount of property, plant and equipment that would have been included in the consolidated
financial statements had the buildings been carried at cost less any accumulated depreciation and any accumulated impairment
losses is UAH 723,245 thousand or EUR 21,428 thousand (2020: UAH 760,108 thousand or EUR 21,880 thousand), machinery
and equipment is UAH 1,859,135 thousand or EUR 53,516 thousand (2020: UAH 2,090,596 thousand or EUR 60,179 thousand)
and construction is UAH 1,699,257 thousand or EUR 48,914 thousand (2020: UAH 1,779,820 thousand or EUR 51,233 thousand).
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
134 135
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
In 2021 revaluation surplus of UAH 404,702 thousand or EUR 18,333 thousand (2020: UAH 450,576 thousand or EUR
20,410 thousand) was reclassified from revaluation reserve to retained earnings because it was realized through depreciation
or disposal of the revalued items of property, plant and equipment.
The most recent valuation of the Group’s buildings, constructions, machinery and equipment was performed as at 31 December
2018 by an independent appraiser in accordance with International Valuation Standards. Most buildings and some machinery
and equipment were valued using the market approach, which is within level 3 of the fair value hierarchy. Other items of buildings,
machinery and equipment and constructions were valued using depreciated replacement cost approach, which is within level 3
of the fair value hierarchy.
For carrying values of property, plant and equipment pledged to secure bank loans refer to Note 12.
6 RIGHT-OF-USE ASSETS AND LEASE LIABILITY
Amounts recognised in the consolidated statement of financial position
The balance sheet shows the following amounts relating to leases:
(in thousands of Ukrainian hryvnias) 31 December 2021 31 December 2020
Right-of-use assets
Land 3 443 687 3 061 307
Office premises 174 510 194 267
Agriculture equipment - 13 632
Warehouse 1 526 2 506
3 619 723 3 271 712
Lease liabilities
Non-current 2 850 501 2 522 108
Current portion
1 022 921 898 493
3 873 422 3 420 601
(in thousands of Euros) 31 December 2021 31 December 2020
Right-of-use assets
Land 111 366 88 122
Office premises 5 643 5 592
Agriculture equipment - 392
Warehouse 49 72
117 058 94 178
Lease liabilities
Non-current 92 182 72 600
Current portion
33 080 25 864
125 262 98 464
Movements for the right-of-use assets during the 2021 financial year were the following:
(in thousands of Ukrainian hryvnias)
Right-of-use
assets:
Land
Right-of-use
assets:
Office
premises
Right-of-use
assets:
Agriculture
equipment
Right-of-use
assets:
Warehouse Total
Cost as at 31 December 2020 4 378 511 208 770 13 632 2 976 4 603 889
Accumulated depreciation
(1 317 204) (14 503) - (470) (1 332 177)
Net book value as at 31 December 2020
3 061 307 194 267 13 632 2 506 3 271 712
Additions to the right-of-use assets 984 940 1 594 - 962 987 496
Depreciation (573 638) (14 772) - (1 812) (590 222)
Other changes - (6 579) - - (6 579)
Disposals
(1) (28 922) - (13 632) (130) (42 684)
Cost of the right-of-use assets (159 610) - (13 632) (1 334) (174 576)
Accumulated depreciation 130 688 - - 1 204 131 892
Cost as at 31 December 2021 5 203 841 203 785 - 2 604 5 410 230
Accumulated depreciation (1 760 154) (29 275) - (1 078) (1 790 507)
Net book value as at 31 December 2021
3 443 687 174 510 - 1 526 3 619 723
(in thousands of Euros)
Right-of-use
assets:
Land
Right-of-use
assets:
Office
premises
Right-of-use
assets:
Agriculture
equipment
Right-of-use
assets:
Warehouse Total
Cost as at 31 December 2020 126 038 6 009 392 86 132 525
Accumulated depreciation
(37 916) (417) - (14) (38 347)
Net book value as at 31 December 2020
88 122 5 592 392 72 94 178
Additions to the right-of-use assets 30 493 49 - 30 30 572
Depreciation (17 729) (462) - (57) (18 248)
Other changes - (204) - - (204)
Currency translation differences 11 376 668 30 8 12 082
Disposals
(1) (896) - (422) (4) (1 322)
Cost of the right-of-use assets (4 942) - (422) (41) (5 405)
Accumulated depreciation 4 046 - - 37 4 083
Cost as at 31 December 2021 168 286 6 590 - 84 174 960
Accumulated depreciation (56 920) (947) - (35) (57 902)
Net book value as at 31 December 2021
111 366 5 643 - 49 117 058
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
136 137
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Movements for the right-of-use assets during the 2020 financial year were the following:
(in thousands of Ukrainian hryvnias)
Right-of-use
assets:
Land
Right-of-use
assets:
Office premises
Right-of-use
assets:
Agriculture
equipment
Right-of-use
assets:
Warehouse Total
Cost as at 31 December 2019 4 452 345 172 377 94 000 15 046 4 733 768
Accumulated depreciation
(963 927) (1 930) (12 841) (2 213) (980 911)
Net book value as
at 31 December 2019
3 488 418 170 447 81 159 12 833 3 752 857
Additions to the right-of-use assets 231 984 36 394 4 401 6 722 279 501
Depreciation (545 881) (12 442) (7 990) (9 981) (576 294)
Reclassification to non-current assets
held for sale
(75 231) - - - (75 231)
Other changes (82) (132) (5 453) 595 (5 072)
Disposals
(1) (37 901) - (58 485) (7 663) (104 049)
Cost of the right-of-use assets (205 701) - (79 316) (18 826) (303 843)
Accumulated depreciation 167 800 - 20 831 11 163 199 794
Cost as at 31 December 2020 4 378 511 208 770 13 632 2 976 4 603 889
Accumulated depreciation (1 317 204) (14 503) - (470) (1 332 177)
Net book value as
at 31 December 2020
3 061 307 194 267 13 632 2 506 3 271 712
(in thousands of Euros)
Right-of-use
assets:
Land
Right-of-use
assets:
Office premises
Right-of-use
assets:
Agriculture
equipment
Right-of-use
assets:
Warehouse Total
Cost as at 31 December 2019 168 509 6 524 3 558 569 179 160
Accumulated depreciation
(36 482) (73) (486) (84) (37 125)
Net book value as
at 31 December 2019
132 027 6 451 3 072 485 142 035
Additions to the right-of-use assets 7 532 1 182 143 218 9 075
Depreciation (17 740) (405) (260) (324) (18 729)
Reclassification to non-current assets
held for sale
(2 166) - - - (2 166)
Other changes (3) (4) (177) 19 (165)
Currency translation differences (30 298) (1 632) (487) (77) (32 494)
Disposals
(1) (1 230) - (1 899) (249) (3 378)
Cost of the right-of-use assets (6 678) - (2 575) (611) (9 864)
Accumulated depreciation 5 448 - 676 362 6 486
Cost as at 31 December 2020 126 038 6 009 392 86 132 525
Accumulated depreciation (37 916) (417) - (14) (38 347)
Net book value as
at 31 December 2020
88 122 5 592 392 72 94 178
(1)
For the year ended 31 December 2021 and 2020 the line item Disposal presented result of cost and acсumulated depreciation set off due to expiration or early termination of land
lease agreements in 2021 and 2020 respectively.
Movements for the lease liabilities during the 2021 financial year were the following:
(in thousands of Ukrainian hryvnias)
Lease
liabilities:
Land
Lease
liabilities:
Office premises
Lease
liabilities:
Agriculture
equipment
Lease
liabilities:
Warehouse Total
Non-current lease liabilities
at 31 December 2020
2 342 535 175 110 3 466 997 2 522 108
Current portion of lease liabilities
at 31 December 2020
855 018 35 768 5 680 2 027 898 493
Total liabilities as
at 31 December 2020
3 197 553 210 878 9 146 3 024 3 420 601
Additions to the lease liabilities 918 396 410 - 962 919 768
Interest expense on lease liability 638 306 31 823 1 287 308 671 724
Payment of lease liabilities (408 940) (7 285) (9 146) (1 782) (427 153)
Payment of interest on lease liabilities (638 306) (31 823) (1 287) (308) (671 724)
Disposals (44 736) - - (208) (44 944)
Other changes - 5 150 - - 5 150
Non-current lease liabilities
at 31 December 2021
2 679 447 170 821 - 233 2 850 501
Current portion of lease liabilities
at 31 December 2021
982 826 38 332 - 1 763 1 022 921
Total liabilities as
at 31 December 2021
3 662 273 209 153 - 1 996 3 873 422
(in thousands of Euro)
Lease
liabilities:
Land
Lease
liabilities:
Office
premises
Lease
liabilities:
Agriculture
equipment
Lease
liabilities:
Warehouse Total
Non-current lease liabilities at 31 December
2020 67 431 5 040 100 29 72 600
Current portion of lease liabilities at 31
December 2020 24 612 1 030 164 58 25 864
Total liabilities as at 31 December 2020 92 043 6 070 264 87 98 464
Additions to the lease liabilities 28 432 13 - 30 28 475
Interest expense on lease liability 19 778 986 40 10 20 814
Payment of lease liabilities (12 643) (225) (283) (55) (13 206)
Payment of interest on lease liabilities (19 778) (986) (40) (10) (20 814)
Disposals (1 385) - - (6) (1 391)
Other changes - 159 - - 159
Currency translation differences 11 986 747 19 9 12 761
Non-current lease liabilities at 31 December
2021 86 650 5 524 - 8 92 182
Current portion of lease liabilities at 31
December 2021 31 783 1 240 - 57 33 080
Total liabilities as at 31 December 2021 118 433 6 764 - 65 125 262
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
138 139
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Movements for the lease liabilities during the 2020 financial year were the following:
(in thousands of Ukrainian hryvnias)
Lease
liabilities:
Land
Lease
liabilities:
Office
premises
Lease
liabilities:
Agriculture
equipment
Lease
liabilities:
Warehouse Total
Non-current lease liabilities at 31
December 2019 2 569 703 144 903 12 775 4 422 2 731 803
Current portion of lease liabilities at 31
December 2019 896 230 27 264 18 130 11 503 953 127
Total liabilities as at 31 December 2019 3 465 933 172 167 30 905 15 925 3 684 930
Additions to the lease liabilities 253 816 36 394 3 585 6 764 300 559
Interest expense on lease liability 631 878 33 734 5 230 2 347 673 189
Payment of lease liabilities (337 771) (481) (25 344) (12 143) (375 739)
Payment of interest on lease liabilities (631 878) (33 734) (5 230) (2 347) (673 189)
Disposals (105 555) - - (7 438) (112 993)
Reclassification to liabilities classified as
assets held for sale (78 627) - - - (78 627)
Other changes (243) 2 798 - (84) 2 471
Non-current lease liabilities at 31
December 2020 2 342 535 175 110 3 466 997 2 522 108
Current portion of lease liabilities at 31
December 2020 855 018 35 768 5 680 2 027 898 493
Total liabilities as at 31 December 2020 3 197 553 210 878 9 146 3 024 3 420 601
(in thousands of Euro)
Lease
liabilities:
Land
Lease
liabilities:
Office
premises
Lease
liabilities:
Agriculture
equipment
Lease
liabilities:
Warehouse Total
Non-current lease liabilities
at 31 December 2019
97 257 5 484 483 167 103 391
Current portion of lease liabilities
at 31 December 2019
33 920 1 032 686 435 36 073
Total liabilities as at 31 December 2019
131 177 6 516 1 169 602 139 464
Additions to the lease liabilities 8 240 1 182 116 220 9 758
Interest expense on lease liability 20 802 1 111 172 77 22 162
Payment of lease liabilities (10 692) (15) (802) (384) (11 893)
Payment of interest on lease liabilities (20 802) (1 111) (172) (77) (22 162)
Disposals (3 427) - - (241) (3 668)
Reclassification to liabilities classified
as assets held for sale
(2 263) - - - (2 263)
Other changes (8) 91 - (3) 80
Currency translation differences (30 984) (1 704) (219) (107) (33 014)
Non-current lease liabilities
at 31 December 2020
67 431 5 040 100 29 72 600
Current portion of lease liabilities
at 31 December 2020
24 612 1 030 164 58 25 864
Total liabilities as at 31 December 2020
92 043 6 070 264 87 98 464
(ii) Amounts recognised in the consolidated income statement
The consolidated income statement shows the following amounts relating to leases:
(in thousands
of Ukrainian hryvnias) (in thousands of Euros)
Notes 2021 2020 2021 2020
Depreciation charge of right-of-use assets
Land 573 638 545 881 17 729 17 740
Office premises 14 772 12 442 462 405
Agriculture equipment - 7 990 - 260
Warehouse 1 812 9 981 57 324
590 222 576 294 18 248 18 729
Interest expense on lease liabilities (cost of disposal included) 18 671 724 673 189 20 814 22 162
Expenses relating to short-term leases (included in operating
expense) 12 856 16 399 397 533
Expenses relating to variable lease payments not included in the
measurement of lease
liabilities (included in operating expenses) 40 165 54 717 1 241 1 778
The total cash outflow for leases for 2021 was UAH 1,098,877 thousand or EUR 34,020 thousand (2020: UAH 1,048,928
thousand or EUR 34,055 thousand) and are classified as finance activities in the consolidated statement of cash flows, including
cash outflow for land lease in amount of UAH 1,047,246 thousand or EUR 32,421 thousand (2020: UAH 969,649 thousand or
EUR 31,494 thousand) and are classified as finance activities in the consolidated statement of cash flows.
(iii) The group’s leasing activities
The Group leases land, office premises and warehouses for operating activities. Land lease contracts are typically made for fixed
periods of 1 to 49 years. Warehouse lease contracts are typically made for fixed periods less than 12 months, management
considers usage period for some warehouses of 3 years, other premises are used by the Group for current storage of finished
goods and the Group has no intentions to extend the lease. Lease payment associated with short-term lease are recognized as
an expense as occurred. Lease terms are negotiated on an individual basis and contain a range of different terms and conditions.
The lease agreements do not impose any covenants and leased assets may not be used as security for borrowing purposes.
7 BIOLOGICAL ASSETS
Biological assets consist of current biological assets (crops) and non-current biological assets (livestock).
Livestock include cattle and other livestock. Cattle consist of dairy livestock with an average yearly lactation period of nine
months, immature cattle and cattle intended for sale. Other livestock mainly represent pigs, horses and sheep. The valuation of
the biological assets is within level 3 of the fair value hierarchy.
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 harvested grains and oilseeds. For dairy cattle
revenue is projected based on the expected milk produced during their productive life after the reporting date and expected
volume of meat at the date of slaughter
• the average productive life of a cow is determined based on internal statistical information
• prices for grains, oilseeds, milk and meat are obtained from market resources as at the end of the reporting period
• production and costs to sell are projected based on actual operating costs
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
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FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
• the growth in sales prices as well as in production expenses and costs to sell is assumed to be in line with forecasted
consumer price index in Ukraine
• a pre-tax discount rate is applied in determining fair value of biological assets. The discount rate is based on the market rate
at the reporting date.
The key assumptions represent management’s assessment of future trends in agriculture and cattle farming business and are
based on both external and internal sources of data.
The significant inputs used in the fair value measurement of the crops are as follows:
• Discount rate (18.0%) (2020: 16.1%)
• Yields of crops on average (5.8 tonnes per hectare for winter wheat, 3.1 tons per hectare for rapeseeds) (2020: 5.6 tonnes
per hectare for winter wheat, 3.0 tons per hectare for rapeseeds)
• Prices of crops (UAH 7,084 per tonne for winter wheat, UAH 17,169 per ton for rapeseeds) (2020: UAH 4,788 per tonne for
winter wheat, UAH 11,900 per ton for rapeseeds)
The significant inputs used in the fair value measurement of the cattle are as follows:
• Discount rate (17.3%) (2020: 18%)
• Milk prices (UAH 13.00 per litre) (2020: UAH 10.76 per litre)
• Meat prices (UAH 42.08 per kilogram) (2020 UAH 29.98 per kilogram)
• Milk yield per day (22.63 litres per day) (2020: 21.54 litres per day)
Significant increases or decreases in any of those inputs in isolation would result in a significantly lower (higher) fair value
measurement. An increase in discount rate leads to a decrease in fair value, whereas increase in prices and yields leads to
increase in fair values.
As at 31 December biological assets comprise the following groups:
(in thousands of Ukrainian hryvnias)
31 December 2021 31 December 2020
Units Amount Units Amount
Non-current biological assets:
Cattle 22 494 856 529 21 966 830 718
Other livestock 129 175
856 658 830 893
Сurrent biological assets
Crops: Hectares Hectares
Winter wheat 55 456 1 085 621 46 530 620 770
Rapeseeds 7 493 195 739 7 244 124 452
62 949 1 281 360 53 774 745 222
Total biological assets 2 138 018 1 576 115
(in thousands of Euros)
31 December 2021 31 December 2020
Units Amount Units Amount
Non-current biological assets:
Cattle 22 494 27 699 21 966 23 912
Other livestock 4 5
27 703 23 917
Сurrent biological assets
Crops: Hectares Hectares
Winter wheat 55 456 35 108 46 530 17 869
Rapeseeds 7 493 6 330 7 244 3 583
62 949 41 438 53 774 21 452
Total biological assets 69 141 45 369
The information about the output of agricultural products during the period, natural losses were not deducted:
(in tonns) 2021 2020
Sugar beet 1 584 133 1 483 366
Corn 507 952 417 659
Winter wheat 268 280 230 039
Milk 96 656 92 579
Sunflower 76 210 89 396
Soy 94 492 62 780
Rapeseeds 23 413 3 647
Barley 2 131 5 713
OVERVIEW
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STATEMENTS
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ASTARTA ANNUAL REPORT 2021
The following table represents the changes during the years ended 31 December in the carrying amounts of non-current and
current biological assets:
(in thousands of Ukrainian hryvnias)
Non-current
livestock
Crops Total
As at 1 January 2020 792 939 425 624 1 218 563
Investments into livestock and future crops 168 092 3 400 395 3 568 487
Gain arising from changes in fair value attributable to physical changes
and to changes in market prices
41 956 1 622 298 1 664 254
Sales (172 094) - (172 094)
Decrease due to harvest - (4 703 095) (4 703 095)
As at 31 December 2020 830 893 745 222 1 576 115
Investments into livestock and future crops 71 940 3 897 340 3 969 280
Gain arising from changes in fair value attributable to physical changes
and to changes in market prices
(46 175) 4 701 682 4 655 507
Decrease due to harvest - (8 062 884) (8 062 884)
As at 31 December 2021 856 658 1 281 360 2 138 018
(in thousands of Euros)
Non-current
livestock
Crops Total
As at 1 January 2020 30 011 16 109 46 120
Investments into livestock and future crops 5 396 109 154 114 550
Gain arising from changes in fair value attributable to physical changes
and to changes in market prices
1 363 52 721 54 084
Sales (5 524) - (5 524)
Decrease due to harvest - (150 972) (150 972)
Currency translation difference (7 329) (5 560) (12 889)
As at 31 December 2020 23 917 21 452 45 369
Investments into livestock and future crops 2 266 122 750 125 016
Gain arising from changes in fair value attributable to physical changes
and to changes in market prices
(1 427) 145 262 143 835
Decrease due to harvest - (249 108) (249 108)
Currency translation difference 2 947 1 082 4 029
As at 31 December 2021 27 703 41 438 69 141
Changes in key assumptions used to estimate biological assets fair value would have the following effect on the fair value
biological assets and on earnings per share:
2021
Biological assets Earnings per share
(in thousands
of Ukrainian
hryvnias)
(in thousands
of Euros)
(Ukrainian
hryvnias)
(Euros)
10% increase in price for milk 297 949 9 635 12,3 0,40
10% decrease in prices for milk (297 949) (9 635) (12,3) (0,40)
10% increase in price for meat 21 467 694 0,9 0,03
10% decrease in price for meat (21 467) (694) (0,9) (0,03)
10% increase in milk yield 64 187 2 076 2,6 0,09
10% decrease in milk yield (64 187) (2 076) (2,6) (0,09)
10% increase in prices for crops 233 818 7 561 9,6 0,31
10% decrease in prices for crops (233 818) (7 561) (9,6) (0,31)
10% increase in yield for crops 233 818 7 561 9,6 0,31
10% decrease in yield for crops (233 818) (7 561) (9,6) (0,31)
10% increase in production costs until harvest (102 875) (3 327) (4,2) (0,14)
10% decrease in production costs until harvest 102 875 3 327 4,2 0,14
5% increase in annual consumer price index 412 630 13 344 17,0 0,55
5% decrease in annual consumer price index (370 145) (11 970) (15,2) (0,49)
1% increase in discount rate (28 246) (913) (1,2) (0,04)
1% decrease in discount rate 28 919 935 1,2 0,04
2020
Biological assets Earnings per share
(in thousands
of Ukrainian
hryvnias)
(in thousands
of Euros)
(Ukrainian
hryvnias)
(Euros)
10% increase in price for milk 220 885 6 358 9,1 0,26
10% decrease in prices for milk (220 885) (6 358) (9,1) (0,26)
10% increase in price for meat 16 861 485 0,7 0,02
10% decrease in price for meat (16 861) (485) (0,7) (0,02)
10% increase in milk yield 65 795 1 894 2,7 0,08
10% decrease in milk yield (65 795) (1 894) (2,7) (0,08)
10% increase in prices for crops 129 542 3 729 5,3 0,15
10% decrease in prices for crops (129 542) (3 729) (5,3) (0,15)
10% increase in yield for crops 129 542 3 729 5,3 0,15
10% decrease in yield for crops (129 542) (3 729) (5,3) (0,15)
10% increase in production costs until harvest (58 419) (1 682) (2,4) (0,07)
10% decrease in production costs until harvest 58 419 1 682 2,4 0,07
5% increase in annual consumer price index 261 375 7 524 10,8 0,31
5% decrease in annual consumer price index (237 949) (6 849) (9,8) (0,31)
1% increase in discount rate (21 320) (614) (0,9) (0,03)
1% decrease in discount rate 21 715 625 0,9 0,03
OVERVIEW
REPORT
ON OPERATIONS
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CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
The sensitivity analyses above have been determined as a result of reasonable changes in key assumptions occurring at the end
of the reporting period. The sensitivity analyses are based on a change in a significant assumption, keeping all other assumptions
constant. The sensitivity analyses may not be representative of an actual change in the fair value of biological assets as it is
unlikely that changes in assumptions would occur in isolation of one another.
For financial risk management regarding biological assets refer to section Material risk factors and threats to the Group of the
Directors’ report.
8 INVENTORIES
Inventories as at 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
31 December
2021
31 December
2020
31 December
2021
31 December
2020
Finished goods:
Agricultural produce 2 628 077 1 064 968 84 989 30 656
Sugar products 2 356 632 1 255 243 76 211 36 133
Soybean processing 291 556 251 890 9 429 7 251
Cattle farming 1 266 1 191 41 34
5 277 531 2 573 292 170 670 74 074
Raw materials and consumables for:
Agricultural produce 484 225 139 070 15 659 4 003
Cattle farming 180 185 183 663 5 827 5 287
Consumables for joint utilization 34 546 38 017 1 117 1 094
Sugar production 32 393 38 670 1 048 1 113
Other production 20 618 12 831 666 368
751 967 412 251 24 317 11 865
Investments into future crops 991 177 748 404 32 053 21 543
7 020 675 3 733 947 227 040 107 482
For carrying value of inventories pledged to secure bank loans refer to Note 12.
9 TRADE AND OTHER ACCOUNTS RECEIVABLE
AND PREPAYMENTS
Trade and other accounts receivable, and prepayments as at 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021
2020
2021
2020
Long-term receivables and prepayments
Advances to suppliers 6 112 6 395 198 184
Other long-term receivables 16 751 115 541 3
22 863
6 510
739
187
Current accounts receivable and
prepayments
Trade receivables 700 511 518 139 22 654 14 915
Less credit loss allowance (37 437) (51 626) (1 211) (1 486)
663 074
466 513
21 443
13 429
Prepayments and other non-financial assets:
VAT recoverable and prepaid 1 046 003 705 500 33 826 20 308
Advances to suppliers 361 442 192 975 11 689 5 555
Less allowance (92 481) (94 655) (2 991) (2 725)
1 314 964
803 820
42 524
23 138
Other financial assets:
Government bonds 20 427 43 488 661 1 252
Other receivables 11 186 10 265 362 296
Less credit loss allowance (2 340) (3 794) (76) (109)
29 273
49 959
947
1 439
1 344 237
853 779
43 471
24 577
2 007 311
1 320 292
64 914
38 006
During the year ended 31 December 2021 the Group received VAT budget refund in cash amounting to UAH 354,818 thousand
or EUR 10,985 thousand (2020: UAH 680,644 thousand or EUR 22,098 thousand).
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Changes in credit loss allowances for trade and other accounts receivable during the year ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021
2020
2021
2020
Balance as at 1 January 55 420 72 992 1 595 2 762
Charge in income statement 13 076 (13 632) 411 (438)
Amounts written off (28 719) (3 919) (889) (127)
Reclassification to non-current assets held
for sale
- (21) - (1)
Currency translation difference - - 170 (601)
Balance as at 31 December
39 777
55 420
1 287
1 595
Changes in allowances for advances to suppliers during the year ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2 021
2 020
2 021
2 020
Balance as at 1 January 94 655 65 695 2 725 2 486
Charge in income statement (2 090) 37 359 (66) 1 200
Amounts written off (84) (3 609) (3) (117)
Reclassification to non-current assets held
for sale
- (4 790) - (155)
Currency translation difference -
-
335
(689)
Balance as at 31 December
92 481
94 655
2 991
2 725
The ageing of trade receivables at the reporting date is as follows:
Gross Lifetime ECL Gross Lifetime ECL
(in thousands of Ukrainian hryvnias) 2021 2021 2020 2020
Not past due 625 621 (8 450) 352 771 (4 308)
Past due 1-30 days 43 467 (510) 113 331 (1 135)
Past due 31-120 days 2 593 (76) 5 721 (118)
Past due 121-365 days 10 293 (9 864) 1 316 (1 065)
More than one year 18 537 (18 537) 45 000 (45 000)
700 511
(37 437)
518 139
(51 626)
Gross Lifetime ECL Gross Lifetime ECL
(in thousands of Euros) 2021 2021 2020 2020
Not past due 20 232 (274) 10 155 (124)
Past due 1-30 days 1 406 (16) 3 262 (33)
Past due 31-120 days 84 (2) 165 (3)
Past due 121-365 days 333 (320) 38 (31)
More than one year 599 (599) 1 295 (1 295)
22 654
(1 211)
14 915
(1 486)
Trade receivables that are past due relate to customers with no recent history of significant indebtness or default and hence
management believes collection is probable.
The ageing of other receivables at the reporting date is as follows:
Gross Lifetime ECL Gross Lifetime ECL
(in thousands of Ukrainian hryvnias)
2021
2021
2020
2020
Not past due 8 159 (30) 5 762 (54)
Past due 1-30 days 134 (1) 21 -
Past due 31-120 days 533 (5) 205 (17)
Past due 121-365 days 59 (3) 572 (18)
More than one year 2 301 (2 301) 3 705 (3 705)
11 186
(2 340)
10 265
(3 794)
Gross Lifetime ECL Gross Lifetime ECL
(in thousands of Euros)
2021
2021
2020
2020
Not past due 264 (1) 166 (1)
Past due 1-30 days 4 - 1 -
Past due 31-120 days 17 - 6 -
Past due 121-365 days 2 - 16 (1)
More than one year 75 (75) 107 (107)
362
(76)
296
(109)
10 CASH AND CASH EQUIVALENTS
Cash and cash equivalents as at 31 December are as follows:
(in thousands of Ukrainian hryvnias)
(in thousands of Euros)
2021 2020 2021 2020
Cash in banks in UAH
218 259 371 645 7 060 10 698
Cash in banks in USD
125 591 397 770 4 061 11 450
Cash in banks in PLN
2 915 3 746 94 108
Cash in banks in EUR
392 1 196 13 34
Cash in banks in CHF
139 176 4 5
Total cash in banks 347 296 774 533 11 232 22 295
Cash in transit in USD
8 849 - 286 -
Cash on hand in UAH
724 298 23 9
Total cash and equivalents 356 869 774 831 11 541 22 304
OVERVIEW
REPORT
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CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
As at 31 December 2021 and 31 December 2020, cash and cash equivalents consisted of current accounts in banks and
overnight deposits. As at 31 December 2021 weighted average interest of current accounts and overnight deposits denominated
in USD is 0.0% p.a., in UAH – up to 5.2% p.a.
The identified impairment loss arising on short-term cash deposits and cash and cash equivalents was immaterial as at
31 December 2021 and 31 December 2020.
11 EQUITY
Share capital
Astarta Holding N.V. has one class of common shares with par value of EUR 0.01. All shares have equal voting rights. The number
of authorized shares as at 31 December 2021 is 30,000 thousand (2020: 30,000 thousand) and the number of issued and fully
paid-up shares is 25,000 thousand (2020: 25,000 thousand).
Shareholders structure as at 31 December is as follows:
2021
2020
Astarta Holding N.V.
Ivanchyk family 40,00% 39,57%
Fairfax Financial Holdings LTD and its subsidiaries 29,91% 29,91%
Other shareholders 30,09% 30,52%
100,00%
100,00%
The earnings and weighted average number of ordinary shares used in calculation of earnings per share are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Net profit attributable to equity holders of the
company
3 998 537 266 398 122 491 8 611
Weighted average basic and diluted shares
outstanding (in thousands of shares)
24 298 24 310 24 298 24 310
Earnings per share attributable to shareholders of
the company
164,56 10.96 5,04 0.35
On 28 May 2021, the annual general meeting of shareholders approved an annual dividend of EUR 0.5 per share, which were
paid in full in the amount of EUR 12,155 thousand in June 2021.
Capital risk management
The objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide
returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of
capital. The policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain
future development of the business.
The Board of Directors seeks to maintain a balances between levels of borrowings and the capital position. The Group’s capital
management policy is to hold sufficient capital to cover the statutory requirements, including any additional amounts required
by the regulator.
In order to achieve the overall objective, the Group’s capital management, amongst other things, aims to ensure that it meets
financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches
in meeting the financial covenants, in the absence of waivers from the bank, would permit the bank to immediately call loans
and borrowings.
Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio. The objective is to maintain
gearing ratio below 60%. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings
and lease liabilities (including current and non-current portion as shown in the consolidated statement of financial position) less
cash, cash equivalents and short-term deposits. Total capital is calculated by adding net debt to equity.
As at 31 December 2021, the gearing ratio was 24% compared to 28% a year before. The decrease in gearing ratio is attributable
to decrease in net debt. The gearing ratios at 31 December are as follows:
(in thousands
of Ukrainian hryvnias) (in thousands of Euros)
2021
2020
2021
2020
Total borrowings (note 12) 5 063 460 5 264 795 163 747 151 550
Less cash, cash equivalents and short-term deposits (363 747) (779 817) (11 763) (22 448)
Net debt 4 699 713 4 484 978 151 984 129 102
Total equity 15 311 108 11 718 655 495 142 337 326
Total capital 20 010 821 16 203 633 647 126 466 428
Gearing ratio
23%
28%
23%
28%
There were no changes in the approach to capital management during the reporting period.
Dividend policy
The Company’s policy is to pay dividends at a level consistent with the Group’s growth and development plans, while maintaining
a reasonable level of liquidity.
The dividend policy will, however, be reviewed from time to time and payment of any future dividends will be effectively at the
discretion of the General Meeting of Shareholders by recommendation of the Board of Directors and after taking into account
various factors including business prospects, future earnings, cash requirements, financial position, expansion plans and
requirements of Dutch law. In addition, payment of future dividends may be made only if shareholders’ equity exceeds the sum
of the paid-in share capital plus the reserves required to be maintained by law and by the Articles of Association. All shares carry
equal dividend rights.
Treasury shares
As at 31 December 2021, the Group had 750,000 of treasury shares with total cost of UAH 137,875 thousand (EUR 6,103
thousand) (2020: 689,898 of treasury shares with total cost of UAH 119,260 thousand (EUR 5,527 thousand).
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
150 151
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
12 LOANS AND BORROWINGS
This note provides information about the contractual terms of loans and borrowings. Refer to Note 22 for more information on
exposure to interest rate, foreign currency risk and information on financial risk management. Loans and borrowings as at 31
December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Long-term loans and borrowings:
Bank loans 648 778 1 230 697 20 981 35 426
Transaction costs (3 888) (12 084) (126) (348)
644 890 1 218 613 20 855 35 078
Current portion of long-term loans and
borrowings:
Bank loans 206 722 535 026 6 685 15 401
Borrowings from non-financial institutions 95 413 98 937 3 086 2 848
Transaction costs (2 507) (8 382) (81) (241)
299 628 625 581 9 690 18 008
Short-term loans and borrowings:
Bank loans 245 520 - 7 940 -
Transaction costs - - - -
245 520 - 7 940 -
1 190 038 1 844 194 38 485 53 086
The following table summarises borrowings as of 31 December:
(in thousands
of Ukrainian
hryvnias)
(in thousands of
Euros)
Currency WAIR1 2021 2021
Short-term loans and borrowings and on demand:
USD 2,73% 245 504 7 939
Interest payable 16 1
Total short-term loans and borrowings 245 520 7 940
Long-term loans and current portion of long-term loans and borrowings:
USD 4,55% 944 205 30 534
Interest payable 6 708 218
Transaction costs (6 395) (207)
Total long-term loans and borrowings 944 518 30 545
Total loans and borrowings 1 190 038 38 485
(in thousands
of Ukrainian
hryvnias)
(in thousands of
Euros)
Currency WAIR
1
2020 2020
Long-term loans and current portion of long-term loans and borrowings:
USD 6,56% 1 839 452 52 949
Interest payable 25 208 726
Transaction costs (20 466) (589)
Total long-term loans and borrowings 1 844 194 53 086
Total loans and borrowings 1 844 194 53 086
1
WAIR represents the weighted average interest rate on outstanding borrowings.
As of 31 December the Group’s total bank borrowings are repayable as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Total current portion repayable in one year or on
demand
452 242 535 026 14 625 15 401
Transaction costs (2 507) (8 382) (81) (241)
Borrowings from non-financial institutions 95 413 98 937 3 086 2 848
545 148 625 581 17 630 18 008
Due in the second year 205 328 369 027 6 641 10 623
Transaction costs (1 922) (5 617) (62) (162)
203 406 363 410 6 579 10 461
Due thereafter 443 449 861 670 14 340 24 803
Transaction costs (1 965) (6 467) (64) (186)
441 484 855 203 14 276 24 617
1 190 038 1 844 194 38 485 53 086
As at 31 December 2021, the Group had a USD denominated loan from the entity under control of the same controlling shareholder
of UAH 95,413 thousand (2020: UAH 98,937 thousand) or EUR 3 million (2020: EUR 3 million) bearing an interest of 4,0% p.a.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
152 153
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Reconciliation of movements of liabilities to cash flows arising from financing activities:
(in thousands of Ukrainian hryvnias) Bank loans
Borrowings from non-
financial institutions Total
Balance as at 31 December 2020 1 745 257 98 937 1 844 194
Changes from financing cash flows
Proceeds from loans and borrowings 2 649 200 - 2 649 200
Repayment of loans and borrowings (3 234 986) - (3 234 986)
Interest paid (97 809) (4 255) (102 064)
Total changes from financing cash flows (683 595) (4 255) (687 850)
The effect of changes in foreign exchange rates (60 945) (3 468) (64 413)
Other changes related to liability
Interest expense 93 908 4 199 98 107
Total liability-related other changes 93 908 4 199 98 107
Balance as at 31 December 2021 1 094 625 95 413 1 190 038
(in thousands of Euros) Bank loans
Borrowings from non-
financial institutions Total
Balance as at 31 December 2020 50 238 2 848 53 086
Changes from financing cash flows
Proceeds from loans and borrowings 82 016 - 82 016
Repayment of loans and borrowings (100 151) - (100 151)
Interest paid (3 028) (132) (3 160)
Total changes from financing cash flows (21 163) (132) (21 295)
The effect of changes in foreign exchange rates (1 750) (100) (1 850)
Other changes related to liability
Interest expense 2 849 127 2 976
Total liability-related other changes 2 849 127 2 976
Currency translation differences 5 225 343 5 568
Balance as at 31 December 2021 35 399 3 086 38 485
(in thousands of Ukrainian hryvnias) Bank loans
Borrowings from non-
financial institutions Total
Balance as at 31 December 2019 3 905 325 42 161 3 947 486
Changes from financing cash flows
Proceeds from loans and borrowings 2 467 615 49 483 2 517 098
Repayment of loans and borrowings (5 210 548) (8 112) (5 218 660)
Interest paid (252 045) (3 363) (255 408)
Total changes from financing cash flows (2 994 978) 38 008 (2 956 970)
The effect of changes in foreign exchange rates 604 115 14 788 618 903
Other changes related to liability
Interest expense 230 795 3 980 234 775
Total liability-related other changes 230 795 3 980 234 775
Balance as at 31 December 2020 1 745 257 98 937 1 844 194
(in thousands of Euros) Bank loans
Borrowings from non-
financial institutions Total
Balance as at 31 December 2019 147 806 1 596 149 402
Changes from financing cash flows
Proceeds from loans and borrowings 80 113 1 607 81 720
Repayment of loans and borrowings (169 167) (263) (169 430)
Interest paid (8 183) (109) (8 292)
Total changes from financing cash flows (97 237) 1 235 (96 002)
The effect of changes in foreign exchange rates 19 613 480 20 093
Other changes related to liability
Interest expense 7 434 128 7 562
Total liability-related other changes 7 434 128 7 562
Currency translation differences (27 378) (591) (27 969)
Balance as at 31 December 2021 50 238 2 848 53 086
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
154 155
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Bank loans are secured as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
(in thousands of Ukrainian hryvnias) 2021 2020 2021 2020
Property, plant and equipment (Note 5) 1 161 873 3 151 109 37 574 90 707
Inventories (Note 8) 435 086 546 344 14 070 15 727
1 596 959 3 697 453 51 644 106 434
13 OTHER LIABILITIES AND ACCOUNTS PAYABLE
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Other liabilities:
Advances received from customers 122 755 80 704 3 970 2 323
VAT payable 74 523
42 955
2 410
1 236
197 278
123 659
6 380
3 559
Other accounts payable:
Provision for annual bonuses 156 244 - 5 051 -
Accrual for unused vacations 69 517 64 736 2 248 1 863
Other taxes and charges payable 39 441 33 204 1 275 956
Salaries payable 27 554 19 463 891 560
Social insurance payable 5 959 4 190 193 121
Accounts payable for property, plant and
equipment
2 586 15 961 84 459
Other payables 22 699 53 830 735 1 551
324 000
191 384
10 477
5 510
521 278
315 043
16 857
9 069
14 REVENUES
Revenues for the years ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Sugar production 5 414 370 3 949 165 170 197 126 973
Crops 5 886 830 5 447 162 185 049 175 137
Soybean processing products 2 857 199 2 337 570 89 814 75 157
Cattle farming 1 223 959 1 031 557 38 474 33 167
Other sales 248 818 161 610 7 821 5 196
15 631 176 12 927 064 491 355 415 630
The Group derives revenue from the transfer of goods and services over time and at a point in time in the following major product lines.
In 2021, 56% of revenue is generated from sales to customers in Ukraine (2020: 50%).
15 COST OF REVENUES
Cost of revenues for the years ended 31 December by product is as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020
2021 2020
Sugar production 3 927 841 3 075 602 123 711 98 728
Crops 5 636 672 4 853 108 177 531 155 787
Soybean processing products 2 615 543 1 995 615 82 379 64 060
Cattle farming 848 402 779 261 26 721 25 015
Other sales 178 298 143 050 5 616 4 592
13 206 756 10 846 636 415 958 348 182
The Group’s costs include, inter alia, the following expenses:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Raw materials 7 001 066 6 210 562 220 505 199 362
Depreciation and amortization costs 1 492 418 1 558 232 47 005 50 020
Employee benefits expenses 913 381 1 030 828 28 768 33 090
Gain from agriculture produce remeasurement 2 785 993 1 349 313 87 747 43 314
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
156 157
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
16 GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses for the years ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Salary and related charges 724 258 440 425 22 630 14 336
Professional services 91 248 89 168 2 851 2 902
Depreciation 89 543 73 298 2 798 2 386
Fuel and other materials 15 087 15 213 471 495
Taxes other than corporate income tax 12 994 10 984 406 358
Insurance 8 270 7 819 258 255
Other 42 443 63 397 1 327 2 063
983 843 700 304 30 741 22 795
17 SELLING AND DISTRIBUTION EXPENSES
Selling and distribution expenses for the years ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Transportation 498 540 518 424 15 795 16 828
Storage and logistics 283 415 248 117 8 979 8 054
Salary and related charges 126 246 96 592 4 000 3 135
Fuel and other materials 25 902 22 147 821 719
Depreciation 23 049 22 309 730 724
Professional services 6 660 18 702 211 607
Other 29 661 25 181 939 817
993 473 951 472 31 475 30 884
18 OTHER OPERATING EXPENSES
Other operating expenses for the years ended 31 December are as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Other salary and related charges 63 858 24 682 2 005 793
Depreciation 54 812 55 949 1 721 1 797
Penalties paid 53 498 128 389 1 680 4 123
Loss on disposal of property, plant and equipment 43 018 27 257 1 351 875
VAT written off 40 647 18 821 1 276 604
Charity and social expenses 35 168 53 670 1 104 1 723
Allowance for other accounts receivable 10 986 23 727 345 762
Other 21 479 26 960 673 865
323 466 359 455 10 155 11 542
19 FINANCE COSTS AND INCOME
Finance (costs) income for the years ended 31 December is as follows:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Finance costs
Interest expense
Bank loans (93 908) (230 795) (2 849) (7 434)
Borrowings from non-financial institutions (4 199) (3 980) (127) (128)
Net profit attributable to non-controlling interests of
limited liability company subsidiaries
11 594 362 352 12
Interest expense on lease liability (671 724) (673 189) (20 814) (22 162)
Other finance costs (54 888) (99 854) (1 666) (3 217)
Total finance costs (813 125) (1 007 456) (25 104) (32 929)
Finance income
Interest income 9 490 7 227 288 233
Other finance income 2 643 3 527 80 113
Total finance income 12 133 10 754 368 346
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
158 159
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
20 INCOME TAX EXPENSE
In 2021, 11 subsidiaries elected to pay FAT in lieu of other taxes (2020: 11 companies). FAT expense is included to cost of
revenues. The remaining companies were subject to the Ukrainian corporate income tax at 18% rate (2020:18%), Dutch corporate
income tax rate of 25%, Cypriot income tax rate of 12.5% and Switzerland income tax rate of 12.5%.
As at 31 December 2021 the Group has not recognized deferred tax asset of UAH 75,285 thousand or EUR 2,435 thousand (2020:
UAH 173,046 thousand or EUR 4,981 thousand) in respect of tax losses carried forward originating on Ukrainian subsidiaries
because realization of this asset is uncertain. There is no expiration period for these tax losses.
As at 31 December 2021 the Group did not recognize deferred tax asset relating to tax losses of UAH 364,313 thousand or
EUR 11,781 thousand and in 2020 UAH 200,447 thousand or EUR 5,770 thousand originated at Astarta Holding N.V. since
realization of this asset is uncertain. In 2021 cumulative carried forward tax losses in amount UAH 35,156 thousand or EUR
1,137 thousand are expired for utilization (2020: UAH 32,268 thousand or EUR 929 thousand).
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Current tax expenses (250 457) (63 623) (7 873) (2 065)
Deferred tax benefit 50 624 45 190 1 591 1 467
(199 833) (18 433) (6 282) (598)
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Profit before tax 4 198 370 284 831 128 773 9 209
including:
Profit attributable to companies not subject to income tax 3 488 605 616 281 106 461 19 970
Profit attributable to companies subject to income tax 709 765 (331 450) 22 312 (10 761)
Profit before tax 709 765 (331 450) 22 312 (10 761)
Income tax benefit/(expense) at statutory rate of 18% (127 758) 59 661 (4 016) 1 937
Effects of different tax rates in other countries (3 464) 20 942 (109) 680
Non-taxable income/(expense) (83 224) (61 255) (2 616) (1 989)
Previously unrecognised tax loss that is used
to reduce tax expense
50 138 31 334 1 576 1 017
Unrecognised tax loss of current year (35 525) (63 304) (1 117) (2 055)
Derecognition of deferred tax asset due to changes
in status of subsidiary
- (5 811) - (188)
Income tax benefit/(expense) (199 833) (18 433) (6 282) (598)
Movements in temporary differences during the years ended 31 December are as follows:
(in thousands of Ukrainian hryvnias)
As at 31
December
2020
Recognized
in OCI
Derecognition
due to
disposal
Recognized
in income
statement
As at 31
December
2021
Deferred tax assets
Property, plant and equipment - CIP 13 333 - (166) 3 874 17 041
Inventories 2 119 -
-
(462) 1 657
Trade and other accounts receivable and
prepayments
10 010 -
-
732 10 742
Offset of deferred tax assets and deferred tax
liabilities
(17 730)
- - (4 781)
(22 511)
Total deferred tax assets 7 732 - (166) (637) 6 929
Deferred tax liabilities
Property, plant and equipment (195 225) 656 (67) 46 482 (148 154)
Offset of deferred tax assets and deferred tax
liabilities
17 730
- - 4 780
22 510
Total deferred tax liabilities (177 495) 656 (67) 51 262 (125 644)
(in thousands of Euros)
As at 31
December
2020
Recognized
in OCI
Derecognition
due to disposal
Recognized
in income
statement
Currency
translation
difference
As at 31
December
2021
Deferred tax assets
Property, plant and
equipment - CIP
384 - (5) 122 50 551
Inventories 61 - - (15) 8 54
Trade and other
accounts receivable and
prepayments
288 - - 23 36 347
Offset of deferred tax
assets and deferred tax
liabilities
(510)
- - (150)
(68) (728)
Total deferred tax
assets
223
- (5) (20) 26
224
Deferred tax liabilities
Property, plant and
equipment
(5 620) 21 (2) 1 461 (651) (4 791)
Offset of deferred tax
assets and deferred tax
liabilities
511
- - 150
67
728
Total deferred tax
liabilities
(5 109)
21 (2) 1 611 (584) (4 063)
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
160 161
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
(in thousands of Ukrainian hryvnias)
As at 31
December
2019
Recognized
in OCI
Recognized
in income
statement
As at 31
December
2020
Deferred tax assets
Property, plant and equipment - CIP 9 499 - 3 834 13 333
Inventories 6 749 - (4 630) 2 119
Trade and other accounts receivable and prepayments 30 083 - (20 073) 10 010
Offset of deferred tax assets and deferred tax liabilities (21 236)
- 3 506
(17 730)
Total deferred tax assets 25 095 - (17 363) 7 732
Deferred tax liabilities
Property, plant and equipment (273 098) 19 743 58 130 (195 225)
Intangible assets (945) - 945 0
Loans and borrowings (6 409) - 6 409 -
Trade and other accounts payable (575) - 575 -
Offset of deferred tax assets and deferred tax liabilities 21 236
- (3 506)
17 730
Total deferred tax liabilities (259 791) 19 743 62 553 (177 495)
(in thousands of Euros)
As at 31
December
2019
Recognized
in OCI
Recognized
in income
statement
Currency
translation
difference
As at 31
December
2020
Deferred tax assets
Property, plant and equipment - CIP 359 - 124 (99) 384
Inventories 255 - (150) (44) 61
Trade and other accounts receivable
and prepayments
1 139 - (652) (199) 288
Offset of deferred tax assets and
deferred tax liabilities
(803)
- 114
179 (510)
Total deferred tax assets 950
- (564) (163)
223
Deferred tax liabilities
Property, plant and equipment (10 334) 641 1 887 2 186 (5 620)
Intangible assets (36) - 31 5 -
Loans and borrowings (243) - 208 35 -
Trade and other accounts payable (22) - 19 3 -
Offset of deferred tax assets and
deferred tax liabilities
803
- (114)
(178)
511
Total deferred tax liabilities (9 832)
641 2 031 2 051 (5 109)
21 SEGMENT REPORTING
An operating segment is a group of assets and operations engaged in providing products or services that are subject to risks and
returns that are different from those of other operating segments.
At 31 December 2021 and 2020, the group is organized into four main operating/ reportable segments:
• production and wholesale distribution of sugar (sugar production)
• growing and selling grain and oilseeds crops (agriculture)
• dairy cattle farming (cattle farming)
• soybean processing
Other Group operations mainly comprise the production and sales of fodder and gas. Neither of these constitutes a separately
reportable operating segment.
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-
maker. The chief operating decision-maker that makes strategic decisions is the Board of Director. Operating profit and net profit
are main measures of segment profit or loss that Group uses to evaluate performance and make decisions about the allocation
of resources. The reported measures are determined in accordance with the measurement principles most consistent with those
used in measuring the corresponding amounts in the financial statements.
Revenues from external customers are derived primarily from the sales of sugar, crops, soybean processing and cattle farming
products and are measured in a manner consistent with that in the income statement. Transfer prices between operating
segments are on arm’s length basis in a manner similar to transactions with third parties.
The amounts provided to the Board of Directors with respect of total assets are measured in a manner consistent with that of
the consolidated financial statements. These assets are allocated based on the operations of the segment and the physical
location of the asset. The amounts of total liabilities are measured in a manner consistent with that of the consolidated financial
statements. Liabilities are allocated based on the operations of the segment.
All unallocated items relate to overall Group’s operational activity and may not be allocated to the identified reporting segments.
Items which are not disclosed separately in segment income and expenses are as follows: other operating income, general and
administrative expenses, selling and distribution expenses, other operating expenses and income tax.
Unallocated assets mainly represent assets relating to corporate function, assets jointly used by segments and certain financial
assets. Liabilities not allocated to segments are items related to corporate functions and certain financial liabilities.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
162 163
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The segment information for the years ended 31 December is as follows:
Sugar production Agriculture Cattle farming Soybean processing Unallocated Total
(in thousands of Ukrainian hryvnias) 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020
Revenues from external customers 5 414 370 3 949 165 5 886 830 5 447 162 1 223 959 1 031 557 2 857 199 2 337 570 248 818 161 610 15 631 176 12 927 064
Inter-segment revenues - - 3 334 980 2 231 882 - - - - - - 3 334 980 2 231 882
Cost of revenues (3 927 841) (3 075 602) (5 636 672) (4 853 108) (848 402) (779 261) (2 615 543) (1 995 615) (178 298) (143 050) (13 206 756) (10 846 636)
Inter-segment cost of revenues (1 794 088) (1 247 229) - - (583 307) (455 446) (957 585) (529 207) - - (3 334 980) (2 231 882)
Changes in fair value of biological assets and
agricultural produce
- - 4 701 682 1 622 298 (46 175) 41 956 - - - - 4 655 507 1 664 254
Gross profit 1 486 529 873 563 4 951 840 2 216 352 329 382 294 252 241 656 341 955 70 520 18 560 7 079 927 3 744 682
General and administrative expense (277 376) (187 967) (532 807) (392 372) (62 713) (48 397) (24 781) (19 526) (86 166) (52 042) (983 843) (700 304)
Selling and distribution expense (258 975) (225 368) (630 092) (558 509) (13 999) (14 940) (72 009) (133 281) (18 398) (19 374) (993 473) (951 472)
Other operating (expense) income (64 973) (84 166) (45 168) (90 615) (8 262) (550) (27 143) (7 647) (74 004) (127 180) (219 550) (310 158)
Impairment of property, plant and equipment - - - - - - - - - (55 034) - (55 034)
Profit (loss) from operations 885 205 376 062 3 743 773 1 174 856 244 408 230 365 117 723 181 501 (108 048) (235 070) 4 883 061 1 727 714
Interest expense on lease liability (18 833) (23 904) (620 301) (611 538) - - - - (32 590) (37 747) (671 724) (673 189)
Foreign currency exchange gain (loss) 6 835 (182 834) 31 710 (336 702) - - 440 (31 123) (4 059) 22 909 34 926 (527 750)
Interest expense (19 619) (66 847) (70 593) (157 542) - - (7 828) (7 914) (67) (2 472) (98 107) (234 775)
Interest income - - - - - - - - 9 490 7 227 9 490 7 227
Other income (expense) - - - - - - - - 40 724 (14 396) 40 724 (14 396)
Profit (loss) before tax 853 588 102 477 3 084 589 69 074 244 408 230 365 110 335 142 464 (94 550) (259 549) 4 198 370 284 831
Taxation - - - - - - - - (199 833) (18 433) (199 833) (18 433)
Net profit (loss) 853 588 102 477 3 084 589 69 074 244 408 230 365 110 335 142 464 (294 383) (277 982) 3 998 537 266 398
Consolidated total assets 4 517 709 3 429 229 13 262 166 10 281 635 1 416 716 1 365 511 1 377 006 1 153 375 780 250 1 534 629 21 353 847 17 764 379
Consolidated total liabilities 295 011 468 192 5 081 575 4 868 776 3 866 4 020 111 134 103 592 551 153 601 144 6 042 739 6 045 724
Other segment information:
Depreciation and amortisation 261 688 290 077 1 268 067 1 290 644 36 922 40 312 50 114 47 960 43 031 40 798 1 659 822 1 709 791
Additions to non-current assets:
Property, plant and equipment 72 437 49 947 359 633 311 222 48 072 14 329 12 764 14 702 3 966 6 078 496 872 396 278
Intangible assets 205 5 10 677 2 409 80 - 379 108 1 385 3 780 12 726 6 302
Right-of-use asset 11 018 583 974 022 242 997 - - - - 2 456 35 921 987 496 279 501
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
164 165
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The segment information for the years ended 31 December is as follows:
(in thousands of Euros) Sugar production Agriculture Cattle farming Soybean processing Unallocated Total
2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020
Revenues from external customers 170 197 126 973 185 049 175 137 38 474 33 167 89 814 75 157 7 821 5 196 491 355 415 630
Inter-segment revenues - - 104 833 71 759 - - - - - - 104 833 71 759
Cost of revenues (123 711) (98 728) (177 531) (155 787) (26 721) (25 015) (82 379) (64 060) (5 616) (4 592) (415 958) (348 182)
Inter-segment cost of revenues (56 396) (40 101) - - (18 336) (14 643) (30 101) (17 015) - - (104 833) (71 759)
Changes in fair value of biological assets and
agricultural produce
- - 145 262 52 721 (1 427) 1 363 - - - - 143 835 54 084
Gross profit 46 486 28 245 152 780 72 071 10 326 9 515 7 435 11 097 2 205 604 219 232 121 532
General and administrative expense (8 667) (6 118) (16 648) (12 772) (1 960) (1 575) (774) (636) (2 692) (1 694) (30 741) (22 795)
Selling and distribution expense (8 205) (7 315) (19 962) (18 129) (444) (485) (2 281) (4 326) (583) (629) (31 475) (30 884)
Other operating (expense) income (2 045) (2 708) (1 462) (2 882) (261) (16) (847) (246) (2 328) (4 090) (6 943) (9 942)
Impairment of property, plant and equipment - - - - - - - - - (1 633) - (1 633)
Profit (loss) from operations 27 569 12 104 114 708 38 288 7 661 7 439 3 533 5 889 (3 398) (7 442) 150 073 56 278
Interest expense on lease liability (584) (787) (19 220) (20 132) - - - - (1 010) (1 243) (20 814) (22 162)
Foreign currency exchange gain (loss) 196 (5 936) 911 (10 931) - - 13 (1 010) (117) 743 1 003 (17 134)
Interest expense (595) (2 153) (2 142) (5 074) - - (237) (255) (2) (80) (2 976) (7 562)
Interest income - - - - - - - - 288 233 288 233
Other income (expense) - - - - - - - - 1 199 (444) 1 199 (444)
Profit (loss) before tax 26 586 3 228 94 257 2 151 7 661 7 439 3 309 4 624 (3 040) (8 233) 128 773 9 209
Taxation - - - - - - - - (6 282) (598) (6 282) (598)
Net profit (loss) 26 586 3 228 94 257 2 151 7 661 7 439 3 309 4 624 (9 322) (8 831) 122 491 8 611
Consolidated total assets 146 097 98 712 428 883 295 963 45 815 39 307 44 531 33 201 25 231 44 173 690 557 511 356
Consolidated total liabilities 9 540 13 477 164 332 140 151 125 116 3 594 2 982 17 824 17 304 195 415 174 030
Other segment information:
Depreciation and amortisation 8 102 9 418 39 258 41 902 1 143 1 309 1 551 1 557 1 332 1 324 51 386 55 510
Additions to non-current assets:
Property, plant and equipment 2 243 1 622 11 134 10 104 1 488 465 395 477 123 200 15 383 12 868
Intangible assets 6 - 331 78 2 - 12 4 43 123 394 205
Right-of-use asset 341 19 30 155 7 890 - - - - 76 1 166 30 572 9 075
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
166 167
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
Geographic information:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Revenue from external customers
Ukraine 8 706 217 6 417 480 273 674 206 334
Euroland 5 777 532 5 467 136 181 613 175 779
incl. Switzerland 3 944 316 3 251 898 123 987 104 555
Asia 675 274 880 975 21 227 28 325
Australia and Oceania 247 599 141 511 7 783 4 550
Other 224 554 19 962 7 058 642
15 631 176 12 927 064 491 355 415 630
22 FINANCIAL RISK MANAGEMENT
Overview
The Group has exposure to the following risks from its use of financial instruments:
• credit risk
• liquidity risk
• market risk.
This note presents information about exposure to each of these risks and the Group’s objectives, policies and processes for
measuring and managing risk. Further quantitative disclosures are included throughout these consolidated financial statements.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
The risk management policies are established to identify and analyze the risks faced by the Group, to set appropriate risk limits
and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and
procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles
and obligations.
The Audit Committee oversees how management monitors compliance with risk management policies and procedures and
reviews the adequacy of the risk management framework in relation to the risks.
a) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Group is exposed to credit risk from its operating activities (primarily for trade receivables) and from its
financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial
instruments.
Trade accounts receivable
The exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the
Group’s customer base, including the default risk of the industry and country, in which customers operate, has less of an influence
on credit risk.
Management established a credit policy under which each new customer is analyzed individually for creditworthiness before
standard payment and delivery terms and conditions are offered. The review includes external ratings, where available, and in
some cases bank references.
Majority of customers have been transacting with the Group for over three years, and no losses are expected from non-performance
by these counterparties. In monitoring customer credit risk, customers are grouped according to their credit characteristics, including
whether they are an individual or legal entity, whether they are a wholesale, retail or end-user customer, geographic location,
industry, aging profile, maturity and existence of previous financial difficulties. Trade and other receivables relate mainly to wholesale
customers. Customers that are graded as «high risk» are placed on a restricted customer list, and future sales are made on a
prepayment basis with approval of management. The Group does not require collateral in respect of trade and other receivables.
The Group establishes an allowance that represents its estimate of lifetime expected credit losses in respect of trade and other
receivables. The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected
loss allowance for all trade and other receivables. To measure the expected credit losses, trade and other receivables have been
grouped based on shared credit risk characteristics and the days past due. The expected loss rates are based on the payment
profiles of sales over a period of 24 months before 31 December 2021 and the corresponding historical credit losses experienced
within this period. The historical loss rates are adjusted to current and macroeconomic information on macroeconomic factors
affecting the ability of the customers to settle the receivables.
Evidence that a financial asset is credit-impaired includes the following observable data:
• significant financial difficulty of the borrower or issuer;
• a breach of contract such as a default or being more than 120 days past due;
• it is probable that the borrower will enter bankruptcy.
Guarantees
The Group’s policy is to provide financial guarantees only to wholly-owned subsidiaries. At 31 December 2021 and 2020 no
guarantees are outstanding.
Credit quality of financial assets
The Group trades only with recognised, creditworthy third parties. It is the Group’s policy that all customers who wish to trade on
credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis.
The credit quality of receivables is analysed based on provision matrix or can be assessed by reference to external credit ratings
(if available) or to historical information about counterparty default rates.
(in thousands
of Ukrainian hryvnias)
(in thousands
of Euros)
2021 2020 2021 2020
Counterparties without external credit rating
Group A 610 804 338 977 19 753 9 758
Group B 14 817 13 794 479 397
Gross carrying amount
625 621 352 771 20 232 10 155
Loss allowance
(8 450) (4 308) (274) (124)
Carrying amount - Counterparties without external credit rating
617 171 348 463 19 958 10 031
Past due trade receivables
Gross carrying amount
74 890 165 368 2 422 4 760
Loss allowance
(28 987) (47 318) (937) (1 362)
Carrying amount - Past due trade receivables
45 903 118 050 1 485 3 398
663 074 466 513 21 443 13 429
OVERVIEW
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Group A represents existing customers (more than one year) which did not breach payment terms. Group B represents new
customers (less than one year) for whom there is no recent history of defaults.
Past due trade receivables are mostly due from counterparties without external credit rating.
The information about the exposure to credit risk and ECL for trade and other receivables as at 31 December 2021 provided in
Note 9.
In the year ended 31 December 2021 approximately 13% of revenues (2020: 13%) are derived from two customers. Trade
receivables from these customers as at 31 December 2021 equal to UAH 98,397 thousand or EUR 3,182 thousand (2020: trade
receivables of UAH 30,986 thousand or EUR 892 thousand).
The credit quality of cash deposits by external credit rating:
(in thousands
of Ukrainian hryvnias)
(in thousands
of Euros)
2021 2020 2021 2020
Banks with external credit rating (Moody’s):
Short-term deposits
NP 1 578 2 036 51 59
Banks without external credit rating:
Group A 5 300 2 950 171 85
6 878 4 986 222 144
The credit quality of cash and cash equivalents assessed by reference to external credit ratings:
(in thousands
of Ukrainian hryvnias)
(in thousands
of Euros)
2021 2020 2021 2020
Cash and cash equivalents
Banks with external credit rating (Moody’s):
P-1
120 276 105 201 3 890 3 028
NP
38 519 229 024 1 246 6 593
Banks without external credit rating:
Group A
185 586 436 562 6 002 12 566
Group B
2 915 3 746 94 108
Cash in transit
8 849 - 286 -
Cash on hand
724 298 23 9
356 869 774 831 11 541 22 304
Group A represents Ukrainian banks. Group B represents non-Ukrainian banks. No external ratings in respect of financial
instruments available-for-sale, promissory notes available-for-sale and other accounts receivable are available.
The Group keeps cash and deposits mostly in Ukrainian banks, which are subsidiaries of reputable foreign banks. In 2021 the
Group continued to work with the same banks as in 2020.
The geographic location of the Group’s customers is presented in the table below:
(in thousands
of Ukrainian hryvnias)
(in thousands of Euros)
2021 2020 2021 2020
Trade receivables neither past due nor impaired
Ukraine 550 504 321 908 17 802 9 266
Switzerland 41 164 13 928 1 331 401
Asia 14 633 3 545 473 102
EU 8 152 9 082 264 262
USA 2 718
- 88 -
Past due trade receivables
45 903 118 050 1 485 3 398
663 074 466 513 21 443 13 429
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The approach to managing
liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both
normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
Typically the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60
days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot
reasonably be predicted, such as natural disasters.
The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments
(including future interest payments). Trade and other payables included in the table below exclude advances received from
customers.
31 December 2021
(in thousands of Ukrainian hryvnias)
Carrying
amount
Contractual
cash flows
Less than
one year
From one to
two years
From two to
five years
More than
five years
Bank loans 1 190 038 1 272 145 582 026 227 360 435 481 27 278
Lease liability 3 873 422 7 804 633 1 002 944 991 960 2 598 912 3 210 817
Trade and other accounts payable 639 438 639 438 633 583 4 338 1 517 -
Net assets attributable to non-controlling
participants in limited liability companies
12 852 12 852 - 12 852 - -
5 715 750 9 729 068 2 218 553 1 236 510 3 035 910 3 238 095
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31 December 2021
(in thousands of Euros)
Carrying
amount
Contractual
cash flows
Less than
one year
From one to
two years
From two to
five years
More than
five years
Bank loans 38 485 41 140 18 822 7 353 14 083 882
Lease liability 125 262 252 393 32 434 32 079 84 046 103 834
Trade and other accounts payable 20 678 20 678 20 489 140 49 -
Net assets attributable to non-controlling
participants in limited liability companies
416 416 - 416 - -
184 841 314 627 71 745 39 988 98 178 104 716
31 December 2020
(in thousands of Ukrainian hryvnias)
Carrying
amount
Contractual
cash flows
Less than
one year
From one to
two years
From two to
five years
More than
five years
Bank loans 1 844 194 2 067 215 721 030 425 438 892 287 28 460
Lease liability 3 420 601 7 303 811 888 134 907 041 2 383 273 3 125 363
Trade and other accounts payable 388 382 388 382 384 288 2 165 1 929 -
Non-controlling interests in limited
liability companies
24 586 24 586 - 24 586 - -
5 677 763 9 783 994 1 993 452 1 359 230 3 277 489 3 153 823
31 December 2020
(in thousands of Euros)
Carrying
amount
Contractual
cash flows
Less than
one year
From one to
two years
From two to
five years
More than
five years
Bank loans 53 086 59 505 20 755 12 246 25 685 819
Lease liability 98 464 210 245 25 566 26 110 68 604 89 965
Trade and other accounts payable 11 181 11 181 11 063 62 56 -
Non-controlling interests in limited
liability companies
708 708 - 708 - -
163 439 281 639 57 384 39 126 94 345 90 784
(c) Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect
income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control
market risk exposures within acceptable parameters, while optimizing the return on risk.
Currency risk
The Group is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than
the respective functional currencies of Group entities, which is primarily the Ukrainian hryvnia. The currencies in which these
transactions primarily are denominated are U.S. dollars and EUR. In order to hedge exposure to foreign currency risk, management
attempts to balance the amount of payments in foreign currencies including debt repayments with inflows of currencies from
exports sales.
The exposure to foreign currency risk is as follows:
(in thousands of Ukrainian hryvnias)
2021 2020
EUR USD EUR USD
Trade accounts receivable - 72 176 1 262 66 681
Short-term deposits - - 222 -
Cash and cash equivalents 392 134 440 1 196 397 770
Bank loans - (1 196 416) - (1 864 660)
Trade accounts payable (83) (3 126) (93) (2 684)
Other liabilities and accounts payable (446) - (100) (236)
Net exposure
(137)
(992 926)
2 487
(1 403 129)
(in thousands of Euros)
2021 2020
EUR USD EUR USD
Trade accounts receivable - 2 334 36 1 919
Short-term deposits - - 6 -
Cash and cash equivalents 13 4 347 34 11 450
Bank loans - (38 691) - (53 675)
Trade accounts payable (3) (101) (3) (77)
Other liabilities and accounts payable (14) - (3) (7)
Net exposure
(4)
(32 111)
70
(40 390)
A weakening of the Ukrainian hryvnia against the following currencies as at 31 December would have decreased pre-tax profit as
shown below. This analysis assumes that all other variables, in particular interest rates, remain constant.
pre-tax profit
(Effect in thousands
of Ukrainian hryvnias)
(Effect in thousands
of Euros)
2021 2020 2021 2020
Weakening of UAH, % 10% 10% 10% 10%
EUR
(14) 249 (0) 7
pre-tax profit
2021 2020 2021 2020
Weakening of UAH, % 10% 10% 10% 10%
USD
(99 293) (140 313) (3 211) (4 039)
As stated under Note 2 (h) the consolidated financial statements are presented in UAH. For the benefit of certain users, the
Group also presents all numerical information in EUR. A weakening of the Ukrainian hryvnia against the EUR by 10% as at 31
December 2021 would have decreased total equity by UAH 11 thousand or EUR nil thousand (31 December 2020: UAH 204
OVERVIEW
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thousand or EUR 6 thousand). A weakening of the Ukrainian hryvnia against the USD by 10% as at 31 December 2021 would
have decreased total equity by UAH 81,420 thousand or EUR 2,633 thousand (31 December 2020: UAH 115,057 thousand or
EUR 3,312 thousand).
Strengthening of the Ukrainian hryvnia against the above currencies as at 31 December would have had the equal but opposite
effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.
During the year ended 31 December 2021 the Ukrainian Hryvnia appreciated against the EUR and USD by 10,99% and 3,52%
respectively (2020: depreciated against the EUR and USD by 31.48% and 19.37% respectively). As a result, during the year
ended 31 December 2021 the Group recognized net foreign exchange gain in the amount of UAH 34,926 thousand (2020: net
foreign exchange loss in the amount of UAH 527,750 thousand) in the consolidated income statement.
Interest rate risk
Changes in interest rates impact primarily borrowings by changing either their fair value (fixed rate debt) or future cash flows
(variable rate debt).
At 31 December the interest rate profile of interest bearing financial instruments is as follows:
(in thousands
of Ukrainian hryvnias)
(in thousands
of Euros)
2021 2020 2021 2020
Fixed rate instruments
Financial liabilities (690 576) (1 326 313) (22 331) (38 178)
Variable rate instruments
Financial liabilities (492 738) (492 673) (15 935) (14 182)
The floating interest rates reflect the real market price for the facility utilized by the company which is often based on London
interbank offered rate for loans nominated in US dollars. Taking into account possible growth of interest rates based on London
interbank offered rate in the future periods Management attempts to mitigate the interest rates risks by negotiating with banking
institutions the introduction of the corresponding hedging mechanisms. Currently the Group does not use any cash flow hedges.
The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss, and the Group does
not designate derivatives (interest rate swaps) as hedging instruments under a fair value hedge accounting model.
Sensitivity of the Group’s profit before tax to a reasonably possible change in interest rates, with all other variables held constant,
through the impact on variable rate instruments, is as follows:
Increase (decrease)
in interest rate
(in thousands
of Ukrainian hryvnias)
(in thousands
of Euros)
2021 2020 2021 2020
Libor 1,00% 4 927 4 927 159 142
Libor -1,00% (4 927) (4 927) (159) (142)
Other market price risk
The Group does not enter into commodity contracts other than to meet expected usage and sale requirements; such contracts
are not settled net.
Agricultural risk
The agricultural business of the Group is exposed to significant risks associated with outbreaks of livestock diseases and loss of
the crop as a result of unfavourable weather conditions. Epidemiological surveillance system adopted by the Group minimizes the
risks associated with the disease of cattle. The loss of harvests is minimized at the expense of reseeding damaged winter crops
by spring crops and partial harvest insurance.
Fair values of financial instruments
The fair value of financial instruments that are traded in active markets at each reporting date is determined by reference to
quoted market prices or dealer price quotations (bid price for long positions and ask price for short positions), without any
deduction for transaction costs. This fair value is within level 1 of fair value hierarchy. For financial instruments not traded
in an active market, the fair value is determined using appropriate valuation techniques. Such techniques may include using
recent arm’s length market transactions; reference to the current fair value of another instrument that is substantially the same;
discounted cash flow analysis or other valuation models and are within level 2 or 3 of fair value hierarchy.
As at 31 December 2021 and 2020, the carrying value of the Group’s financial instruments approximates their fair values.
23 TAX AND LEGAL MATTERS
The Group’s operations are concentrated in Ukraine. Ukrainian legislation and regulations regarding taxation and other operational
matters continue to evolve as a result of an economy in transition. Legislation and regulations are not always clearly written and
their interpretation is subject to the opinions of local, regional and national authorities, and other governmental bodies. Instances
of inconsistent opinions are not unusual.
Companies of the Group have significant controlled operations which are governed by transfer pricing rules. Such operations
include export trade operations of agricultural products, as well as interest expenses and royalty. Specified operations are
conducted both with related parties - non-residents, and third parties from low-taxing jurisdiction. In connection with absence of
common methodology of transfer pricing in Ukraine, as well as judiciary practice in the sphere of the transfer pricing, there are
risks that the approaches of tax authorities in the valuation of controlled operations will be different from approaches applied
by the companies of the Group. If the tax authorities establish failure to comply with these rules, they may demand transfer
pricing adjustments. If substantial transfer pricing adjustments were upheld by the relevant Ukrainian authorities or courts and
implemented, the Group’s financial results could be adversely affected; however, the potential amount could not be estimated
reliably. Given risks can be implemented during seven years from the date of submission of the appropriate income tax returns.
According to Ukrainian legislation land lease agreements should be registered by state authorities. As at 31 December 2021
and 31 December 2020 the Group has a number of land lease agreements in respect of which registration procedure was
not finalised. This includes both lease agreements that are not temporarily registered due to lengthy procedure of registration
and which will not be registered at all. Therefore in respect of these agreements the risk of collusion by rivals and/or lessors to
cancel the right of the Group to lease the land plots area according to these agreements exists. Total area leased according to
not registered agreements as at 31 December 2021 comprised 8 thousand hectares which approximate 4% of total land lease
area of the Group and right-of-use assets and lease liability recognised in respect of these agreements as at 31 December 2021
comprised UAH 124,699 thousand or EUR 4,033 thousand and UAH 126,560 thousand or EUR 4,093 thousand respectively (31
December 2020: UAH 98,454 thousand or EUR 2,834 thousand and UAH 99,425 thousand or EUR 2,862 thousand).
The Group’s operations and financial position will continue to be affected by Ukrainian political developments including the
application of existing and future legislation and tax regulations. Management believes that the Group has complied with all
regulations and paid or accrued all taxes that are applicable. In the ordinary course of business, the Group is subject to various
legal actions and complaints. Management believes that the ultimate liability, if any, arising from such actions or complaints will
not have a material adverse effect on the financial condition or the results of the Group’s operations. Where the risk of outflow of
resources is probable, the Group has accrued liabilities based on management’s best estimate.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
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ASTARTA ANNUAL REPORT 2021
24 RELATED PARTY TRANSACTIONS
The Group enters into transactions with related parties in the ordinary course of business. Related parties comprise the Group’s
the shareholders, companies that are under control of the Group’s shareholders, key management personnel and their close
family members and companies that are controlled or significantly influenced by shareholders. Prices for related party transactions
are determined on an market basis.
The following table summarises transactions that have been entered into with related parties for the year ended 31 December
2021 as well as balances with related parties as at 31 December 2021:
(in thousands of Ukrainian hryvnias )
Sales to related
parties:
Purchases from
related parties:
Amounts owed by
related parties:
Amounts owed to
related parties:
Companies under control of one of the
shareholders with significant influence over
the Group
9 619 47 216 8 047 99 189
9 619 47 216 8 047 99 189
(in thousands of Euros)
Sales to related
parties:
Purchases from
related parties:
Amounts owed by
related parties:
Amounts owed to
related parties:
Companies under control of one of the
shareholders with significant influence over
the Group
298 1 462 260 3 208
298 1 462 260 3 208
The following table summarises transactions that have been entered into with related parties for the year ended 31 December
2020 as well as balances with related parties as at 31 December 2020:
(in thousands of Ukrainian hryvnias)
Sales to related
parties:
Purchases from
related parties:
Amounts owed by
related parties:
Amounts owed to
related parties:
Companies under control of one of the
shareholders with significant influence over
the Group
1 485 40 716 5 951 104 129
1 485 40 716 5 951 104 129
(in thousands of Euros)
Sales to related
parties:
Purchases from
related parties:
Amounts owed by
related parties:
Amounts owed to
related parties:
Companies under control of one of the
shareholders with significant influence over
the Group
48 1 322 171 2 997
48 1 322 171 2 997
Other transactions
As at 31 December 2021, the Group had a USD denominated loan from the entity under control of the same controlling
shareholder of UAH 95,413 thousand (2020: UAH 98,937 thousand ) or EUR 3,086 thousand (2020: EUR 2,848 thousand)
bearing an interest of 4.0% p.a.
The Group rents an office premises from related party under control of the shareholder with significant influence over the Group
and has accounted these lease agreements according IFRS 16. As at 31 December 2021, the Group had the lease liability
in amount of UAH 209,153 thousand or EUR 6,764 thousand and respective right-of-use asset in amount of UAH 174,510
thousand or EUR 5,643 thousand (2020: UAH 210,878 thousand or EUR 6,070 thousand and UAH 194,264 thousand or EUR
5,592 thousand respectively) (Note 6). In 2021 the Group recognized depreciation charge of right-of-use asset in amount of UAH
14,772 thousand or EUR 462 thousand as General and administrative expenses (2020: UAH 12,442 thousand or EUR 405
thousand) (Note 6 and Note 16). During 12 months 2021 the interest expense was charged in amount of UAH 31,823 thousand
or EUR 986 thousand (2020: UAH 33,734 thousand or EUR 1,111 thousand) (Note 6 and Note 19).
Management remuneration
The total remuneration of executive and non-executive Board members is specified below:
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021 2020 2021 2020
Viktor Ivanchyk 43 114 11 123 1 342 361
Viktor Gladky 29 766 7 402 926 240
Marc van Campen 1 318 1 166 40 40
Howard Dahl 2 471 2 206 75 75
Gilles Mettetal 1 318 1 166 40 40
Arslan Huseyin 1 318 1 170 40 40
79 305 24 233 2 463 796
Key management are those having the authority and responsibility for planning, directing and controlling the activities of the
Group (totalling six persons). Executive Directors who take part in a day-to-day operational activity of the Company, are entitled
to a remuneration package consisting of an annual fixed and variable remuneration. Variable remuneration comprises long-
term incentives based on long-term incentive plan and short-term incentives in the form of bonuses. Remuneration of key
management for the year ended 31 December 2021 is UAH 79,305 thousand or EUR 2,463 thousand (2020: UAH 24,233
thousand or EUR 796 thousand). This remuneration consist of three components: fixed remuneration of UAH 26,512 thousand
or EUR 848 thousand (2020: UAH 24,233 thousand or EUR 796 thousand), variable remuneration in form of bonuses which
were accrued for Mr.Ivanchyk amounting to UAH 12,012 thousand or EUR 360 thousand (2020: EUR nil) and for Mr. Gladky
amounting to UAH 8,003 thousand or EUR 240 thousand (2020: EUR nil) and expenses on the long-term incentive plan for the
year ended 31 December 2021 were accrued for Mr.Ivanchyk in the amount of UAH 19,376 thousand or EUR 600 thousand
and for Mr. Gladky in the amount of UAH 13,402 thousand or EUR 415 thousand (2020: no expenses were accrued). These
expenses are not part of total 2021 remuneration disclosed in the remuneration report, as these LTI awards were not received
by management. The company does not grant loans, advance payments or guarantees to members of the Board of Directors
or any family member of such persons.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
25 EVENTS SUBSEQUENT
TO THE REPORTING DATE
On 14 February 2022 the Group purchased 100% shares in LLC “Podil Agricultural Traditions” for consideration of UAH 15,139
thousand or EUR 473 thousand. Upon acquisition the company had land area under lease of 790 hectares.
On 24 February 2022 Russian Federation starts its military invasion of Ukraine. As result the government has introduced a
martial law throughout Ukraine. Chernihiv region was temporarly under military invasion, where the Group operates up to 4k ha
of arable land. Currently land under the Group control and sowing campaign in this region is in process.
As at date of issuing of this report the Company continue running its operations without any restrictions. Management of the
Company maintain control over all its operations. Office-based personnel are working remotely while production-based employees
perform their duties at their areas of operations. About 200 of Group’s employees have been mobilized to the Army Forces of
Ukraine. The Company supports these employees with the necessary protective equipment and provides financial support to
such employees. Ministry of Agrarian Policy and Food of Ukraine is working together with Ministry of Defense of Ukraine in order
to reserve workforce for the agricultural sector to proceed with spring sowing campaign.
Agricultural segment of the Group performs maintenance operations to be ready for the start of spring sowing campaign. Both
western part and central part of Group’s business clusters delivering outstanding inputs on its warehouses. The Company plans
to carry out its sowing campaign in order to ensure food security of the country.
Debt service payments are not significant for the Group at this stage and can be covered by current operational cash flow
obtained from sale of goods. The Group has sufficient funds to serve the existing debt. The Company has access to local credit
facilities which disburse funds for main operational needs (incl. salaries, taxes, inputs etc). The Group has already disbursed
UAH 340 mln or EUR 10 mln from local banks for operational needs which are required in March 2022. The Company works with
existing and potential lenders (incl. state banks) in order to attract additional funding when it is needed in the future. The Group
monitors its obligations on the regular basis and is in close contact with all its lenders. The covenants are to be reassessed on
quarterly basis and next reassessment should happen in April 2022 based on results of 1Q ended 31 March 2022.
Business information of the Group is secured and properly stored. Back up storages for all business data are located in different
places.
While the Group’s operations were not largely impacted so far and management prepared its 12 months budget based on the
known facts and events, 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.
COMPANY BALANCE SHEET AS AT 31 DECEMBER 2021
(before appropriation of the result)
(in thousands of Ukrainian hryvnias) 31 December 2021 31 December 2020
Assets
Fixed assets
Intangible assets 183 -
Financial fixed assets
Investments in subsidiaries 3 14 398 633 11 520 750
Accounts receivable from subsidiary - 4 006
14 398 816 11 524 756
Current assets
Receivables
Loan granted to subsidiary 4 27 609 158 195
Other accounts receivable and prepayments 5 884 25 901
Cash and cash equivalents 6 7 409 10 307
35 902 194 403
Total assets 14 434 718 11 719 159
Equity and liabilities
Equity
Called-up share capital 7 1 663 1 663
Share premium 369 798 369 798
Revaluation reserve 2 637 057 2 641 315
Other reserve 458 824 520 161
Retained earnings 7 845 229 7 919 320
Unappropriated profits 3 121 881 266 398
Total equity 14 434 452 11 718 655
Current liabilities
Other liabilities 8 266 504
266 504
Total equity and liabilities 14 434 718 11 719 159
The balance sheet is to be read in conjunction with the notes to and forming part of the company financial statements set out on
pages 180 to 190.
COMPANY FINANCIAL
STATEMENTS
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
COMPANY BALANCE SHEET AS AT 31 DECEMBER 2021
(before appropriation of the result)
(in thousands of Euros) 31 December 2021 31 December 2020
Assets
Fixed assets
Intangible assets 6 -
Financial fixed assets
Investments in subsidiaries 3 465 634 331 629
Accounts receivable from subsidiary - 115
465 640 331 744
Current assets
Receivables
Loan granted to subsidiary 4 893 4 554
Other accounts receivable and prepayments 5 28 74 5
Cash and cash equivalents 6 240 297
1 161 5 596
Total assets 466 801 337 340
Equity and liabilities
Equity
Called-up share capital 7 250 250
Share premium 55 638 55 638
Revaluation reserve 139 055 144 991
Other reserve (274 591) (320 099)
Retained earnings 452 299 447 935
Unappropriated profits 94 141 8 611
Total equity 466 792 337 326
Current liabilities
Other liabilities 8 9 14
9 14
Total equity and liabilities 466 801 337 340
The balance sheet is to be read in conjunction with the notes to and forming part of the company financial statements set out on
pages 180 to 190.
COMPANY PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousands of Ukrainian hryvnias) 2021 2020
Dividend income 9 258 407 -
Interest income related parties 10 2 326 6 745
Royalty income 11 24 032 22 331
Operating income 284 765 29 076
Impairment on participations - -
Interest expense related parties - -
Other operating expense (56 624) (15 061)
Impairment of investments in subsidiaries 3 (876 656) -
Operating expense (933 280) (15 061)
Operating (loss)/profit (648 515) 14 015
Other finance income and expense 2 778 (14 015)
Loss before taxation (645 737) -
Income tax expense 12 - -
Share in profit/loss of participations 3 767 618 266 398
Profit after taxation 3 121 881 266 398
(in thousands of Euros) 2021 2020
Dividend income 9 8 000 -
Interest income related parties 10 72 219
Royalty income 11 74 4 725
Operating income 8 816 944
Impairment on participations - -
Interest expense related parties - -
Other operating expense (1 753) (489)
Impairment of investments in subsidiaries 3 (28 350) -
Operating expense (30 103) (489)
Operating (loss)/profit (21 287) 455
Other finance income and expense 86 (455)
Loss before taxation (21 201) -
Income tax expense 12 - -
Share in profit/loss of participations 115 342 8 611
Profit after taxation 94 141 8 611
The profit and loss account is to be read in conjunction with the notes to and forming part of the company statements set out on
pages 180 to 190.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
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ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
1 GENERAL
Astarta Holding N.V. (the Company) is a Dutch public company with limited liability, incorporated in Amsterdam on 9 June 2006,
registered with the Chamber of Commerce of the Netherlands number 34.24.88.91. The Company acts as a holding company for
a number of entities operating in the agricultural sector in Ukraine.
These financial statements are prepared in accordance with Section 9, Book 2 of the Netherlands Civil Code.
Information on the use of financial instruments and on related risks for the Group has been provided under note 22 of the
consolidated financial statements.
2 SUMMARY OF PRINCIPAL
ACCOUNTING POLICIES
BASIS OF PREPARATION
For setting the principles for the recognition and measurement of assets and liabilities and determination of the result for
its company financial statements, the Company makes use of the option provided in Article 362-8 of Book 2 Section 9 of
the Netherlands Civil Code. This means that the principles for the recognition and measurement of assets and liabilities and
determination of the result (hereinafter referred to as principles for recognition and measurement) of the company’s financial
statements are the same as those applied for the consolidated financial statements prepared in accordance with International
Financial Reporting Standards (“IFRS”) as adopted by EU. These principles also include the classification and presentation of
financial instruments, being equity instruments or financial liabilities.
BASIS OF RECOGNITION OF PARTICIPATIONS IN SUBSIDIARIES
Investments in subsidiaries are valued using the equity method, determined applying the IFRS accounting policies as described
in the consolidated financial statements. The share in the result of participating interests consists of the share of the Company
in the result of these participating interests. Results on transactions, where the transfer of assets and liabilities between the
Company and its participating interests and mutually between participating interests themselves, are not incorporated insofar as
they can be deemed to be unrealized.
3 INVESTMENTS IN SUBSIDIARIES
As at 31 December 2021 and 2020 the Company owns 100% of the shares of Ancor Investments Ltd, a subsidiary based in
Cyprus. These shares and control over the subsidiary were received in July 2006 in exchange for a contribution-in-kind transaction.
In August 2017 the Company has incorporated Astarta Trading GmbH, a subsidiary based in Switzerland with share capital of CHF
20,000. The Company owns 100% of the shares of Astarta Trading GmbH, all shares are fully paid. The Company controls Astarta
Trading GmbH since its incorporation.
NOTES TO THE COMPANY
FINANCIAL STATEMENTS
The movements in the valuation of this investment may be summarised as follows:
(in thousands of Ukrainian hryvnias) 2021 2020
Balance as at 1 January 11 520 750 11 439 708
Incorporation of new subsidiary
- -
Net income 3 998 537 266 398
Decrease in reserves (182 661) (222 625)
Impairment of investments in subsidiaries (876 656) -
Other movements - -
Translation differences (61 337) 37 269
Balance as at 31 December 14 398 633 11 520 750
(in thousands of Euros) 2021 2020
Balance as at 1 January 331 629 432 961
Incorporation of new subsidiary
- -
Net income 122 491 8 611
Decrease in reserves (5 644) (7 089)
Impairment of investments in subsidiaries (28 350) -
Other movements
- -
Translation differences 45 508 (102 854)
Balance as at 31 December 465 634 331 629
As at 31 December 2021 the Company recognized impairment of investments in subsidiaries in amount of UAH 876,656 thousand
or EUR 28,350 thousand as equity value of its subsidiaries is lower than carrying value of subsidiaries as at 31 December 2021.
For a list of subsidiaries refer to note 2 of the consolidated financial statements.
4 LOAN GRANTED TO SUBSIDIARY
The terms and repayment schedule for loan granted are as follows:
(in thousands of Ukrainian hryvnias)
Nominal
interest rate Year of maturity
31 December
2021
31 December
2020
Loans granted to subsidiary in USD 5% 2021 - 158 195
Loans granted to subsidiary in USD 2,25% 2022 27 609 -
27 609 158 195
(in thousands of Euros)
Nominal
interest rate Year of maturity
31 December
2021
31 December
2020
Loans granted to subsidiary in USD 5% 2021 - 4 554
Loans granted to subsidiary in USD 2,25% 2022 893 -
893 4 554
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
182 183
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
As at 31 December 2021 the Company granted a loan to its subsidiaries of UAH 27,278 thousand (USD 1,000 thousand) (2020:
UAH 141,373 thousand or USD 5,000 thousand). The loans are unsecured and bears interest of 2,25% p.a. (2020: 5% p.a.).
Fair value of the loans approximates its carrying value.
5 OTHER ACCOUNTS RECEIVABLE
AND PREPAYMENTS
Other accounts receivable and prepayments as at 31 December are as follows:
(in thousands of Ukrainian hryvnias) 31 December 2021 31 December 2020
Other financial assets:
Other accounts receivable - 25 164
Prepayments and other non-financial assets:
Prepayments 884 737
884 25 901
(in thousands of Euros) 31 December 2021 31 December 2020
Other financial assets:
Other accounts receivable - 724
Prepayments and other non-financial assets:
Prepayments 28 21
28 74 5
As at 31 December 2021 other accounts receivable presented by a royalty income receivables for granting a non-exclusive
license to use a trade and services mark to its subsidiaries for 2021 are nil (2020: UAH 25 164 thousand or EUR 724 thousand).
These balances primarily are denominated in U.S. dollars.
Fair value of royalty income receivables approximates its carrying value. The carrying amount of these receivables are not impaired
represents the maximum credit exposure. Other accounts receivables are not impaired and not past due.
6 CASH
As at 31 December 2021, amount of cash is UAH 7,409 thousand (EUR 240 thousand) (2020: UAH 10,307 thousand or EUR 297
thousand). There is no restricted cash.
7 EQUITY
The authorized share capital as at 31 December 2021 and 2020 amounts to EUR 300,000 and consists of 30,000,000 ordinary
shares with a nominal value of EUR 0.01 each. As at 31 December 2021, 25,000,000 shares are issued and fully paid. Pursuant
to the Dutch regulation “Disclosure of Remuneration of Board Members Act”, the total number of shares held by executive and
non-executive Board members, and third parties is specified below:
2021 2020
Astarta Holding N.V.
Ivanchyk family 40,00% 39,57%
Fairfax Financial Holdings LTD and its subsidiaries 29,91% 29,91%
Other shareholders 30,09% 30,52%
100,00% 100,00%
The difference between equity according to the Company balance sheet and equity according to the consolidated balance sheet
of UAH 876,656 thousand (EUR 28,350 thousand) (2020: UAH nil or EUR nil), as well as the result according to the Company
income statement and result according to the consolidated income statement of UAH 876,656 thousand (EUR 28,350 thousand)
(2020: UAH nil or EUR nil) is due to recognized impairment of investments in subsidiaries in amount of UAH 876,656 thousand
or EUR 28,350 thosand) (2020: UAH nil or EUR nil) as equity value of its subsidiaries is lower than carrying value of subsidiaries
as at 31 December 2021.
In 2021 and 2020 there were no pledged shares. For movements in equity refer to the consolidated statement of changes
in equity.
With respect to the total equity, not all reserves are available for distribution to the shareholders. The restricted reserves, which
are not available for distribution to the shareholders, include the following:
• the accumulated gain on revaluation of property, plant and equipment of UAH 1,521,501 thousand (EUR 68,922 thousand)
(2020: UAH 1,926,064 thousand or EUR 87,251 thousand) presented within revaluation reserve caption in the balance sheet;
• the accumulated gain on revaluation of biological assets of UAH 1,115,556 thousand (EUR 70,133 thousand) (2020: UAH
715,251 thousand or EUR 57,740 thousand) presented within revaluation reserve caption in the balance sheet;
• the accumulated gain from currency translation adjustment of UAH 458,824 thousand (loss of EUR 274,591 thousand)
(2020: gain of UAH 520,161 thousand or loss of EUR 320,099 thousand) presented within other reserve caption in the
balance sheet.
As at 31 December 2021, the Group had 750,000 of treasury shares with total cost of UAH 137,875 thousand (EUR 6,103
thousand) (2020: 689,898 of treasury shares with total cost of UAH 119,260 thousand or EUR 5,527 thousand). Par value of
each share is EUR 0.01.
In the balance sheet the treasury shares are presented as a deduction from the retained earnings.
In 2021 the Company has declared and paid dividends in amount of EUR 12,155 thousand (UAH 406,171 thousand).
As at 31 December 2021 the Company accrued liability for variable remuneration of the Executive Directors A based on fulfilment
of short-term (STI) and long-term incentives (LTI) in 2020 and 2021 according to the Remuneration Policy in amount of UAH
32,778 thousand (EUR 1,060 thousand).
PROPOSAL FOR PROFIT ALLOCATION
The Board of Directors will propose to the Annual General Meeting of Shareholders to transfer the net profit of UAH 3,121,881
thousand (EUR 94,141 thousand) to retained earnings.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
184 185
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The movements in shareholders’ equity are as follows:
Issued share capital
Share
premium
Revaluation
reserve
Other
reserves
Retained
earnings
Unappropri-
ated
profits Total
(in thousands
of Ukrainian
hryvnias)
Ordinary
shares
Preference
shares
At 1
January
2020
1 663 - 369 798 2 950 868 482 892 7 726 037 61 554 11 592 812
Net result for
the year
- - - - - - 266 398 266 398
Exchange rate
differences
- - - - 37 269 - - 37 269
Remeasure-
ments
- - - (177 824) - - - (177 824)
Reclassification
to profit or loss
- - - (131 729) - 131 729 - -
- - - (309 553) 37 269 131 729 266 398 125 843
Transactions
with sharehold-
ers
Appropriation
of the result of
preceding year
- - - - - 61 554 (61 554) -
Total move-
ments
- - - (309 553) 37 269 193 283 204 844 125 843
At 31
December
2020
1 663 - 369 798 2 641 315 520 161 7 919 320 266 398 11 718 655
Net result for
the year
- - - - - - 3 121 881 3 121 881
Exchange rate
differences
- - - - (61 337) - - (61 337)
Remeasure-
ments
- - - 28 646 - - - 28 646
Reclassification
to profit or loss
- - - (32 904) - 32 904 - -
- - - (4 258) (61 337) 32 904 3 121 881 3 089 190
Transactions with
shareholders
Appropriation
of the result of
preceding year
- - - - - 266 398 (266 398) -
Share-based
incentive plans
- - - - - 32 778 - 32 778
Distribution of
dividends
- - - - - (406 171) - (406 171)
Total move-
ments
- - - (4 258) (61 337) (74 091) 2 855 483 2 715 797
At 31
December
2021
1 663 - 369 798 2 637 057 458 824 7 845 229 3 121 881 14 434 452
Issued share capital
Share pre-
mium
Revaluation
reserve
Other re-
serves
Retained
earnings
Unappropri-
ated profits
Total
(in thousands of
Euros)
Ordinary
shares
Preference
shares
At 1
January
2020
250 - 55 638 162 180 (217 245) 435 342 2 590 438 755
Net result for
the year
- - - - - - 8 611 8 611
Exchange rate
differences
- - - - (102 854) - - (102 854)
Remeasure-
ments
- - - (7 186) - - - (7 186)
Reclassification
to profit or loss
- - - (10 003) - 10 003 - -
- - - (17 189) (102 854) 10 003 8 611 (101 429)
Transactions
with sharehold-
ers
Appropriation
of the result of
preceding year
- - - - - 2 590 (2 590) -
Total move-
ments
- - - (17 189) (102 854) 12 593 6 021 (101 429)
At 31
December
2020
250 - 55 638 144 991 (320 099) 447 935 8 611 337 326
Net result for
the year
- - - - - - 94 141 94 141
Exchange rate
differences
- - - - 45 508 - - 45 508
Remeasure-
ments
- - - 958 - - - 958
Reclassification
to profit or loss
- - - (6 894) - 6 894 - -
- - - (5 936) 45 508 6 894 94 141 140 607
Transactions with
shareholders
Appropriation
of the result of
preceding year
- - - - - 8 611 (8 611) -
Share-based
incentive plans
- - - - - 1 015 - 1 015
Distribution of
dividends
- - - - - (12 155) - (12 155)
Total move-
ments
- - - (5 936) 45 508 4 365 85 530 129 467
At 31
December
2021
250 - 55 638 139 055 (274 591) 452 299 94 141 466 792
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
186 187
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
8 OTHER LIABILITIES
Other liabilities as at 31 December are as follows:
(in thousands of Ukrainian hryvnias) 31 December 2021 31 December 2020
Other liabilities 266 504
266 504
(in thousands of Euros) 31 December 2021 31 December 2020
Other liabilities 9 14
9 14
9 DIVIDEND INCOME
The Company has received interim dividends from its subsidiary Ancor Investments Ltd in amount of EUR 8 million or UAH 258
million. Dividends are distributed from Ancor Investments Ltd profits for 2015 and 2016 in amounts of EUR 5 million and EUR 3
million respectively.
10 INTEREST INCOME RELATED PARTIES
The Company’s interest income is presented by interest income received for loans granted to subsidiaries for 2021 in amount of
UAH 2,326 thousand (EUR 72 thousand) (2020: UAH 6,745 thousand or EUR 219 thousand).
11 ROYALTY INCOME
The Company’s royalty income is presented by a royalty income received for granting a non-exclusive license to use a trade and
services mark to its subsidiaries for 2021 in amount UAH 24,032 thousand (EUR 744 thousand) (2020: UAH 22,331 thousand
or EUR 725 thousand).
12 INCOME TAXES
The Company is subject to Dutch corporate income tax at 25% rate. The effective tax rate is nil for 2021 and 2020.
There is no income tax payable for the current year. The Company’s cumulative carried forward tax losses are UAH 152
million (EUR 4.9 million) as of 31 December 2021 (2020: UAH 215 million or EUR 6.2 million). In 2021 EUR 208 thousand of
cumulative carried forward tax losses are used due to loss in 2021 (2020: nil). In 2021 cumulative carried forward tax losses
in amount EUR 1.1 million are expired for utilization (2020: nil). No deferred tax asset has been recognized due to insufficient
future taxable income.
13 NUMBER OF EMPLOYEES
AND EMPLOYMENT COSTS
The Company has no employees other than directors. Hence, it did not pay any wages and related social security contributions.
14 COMMITMENTS
As at 31 December 2021 and as at 31 December 2020 there were no pledged shares.
As at 31 December 2021 the Company has guaranteed repayment of certain loan agreements incurred by Group subsidiaries
in amount of UAH 5,308 million (EUR 181 million) (2020: UAH 7,264 million or EUR 209 million). Such loans are included as
liabilities in the consolidated financial statements.
15 DIRECTORS
The Company is managed by the Board of Directors which consists of six members: three Executive Directors and three Non-
Executive Directors. The composition of the Board of Directors is as follows:
Viktor Ivanchyk Chief Executive Officer
Victor Gladky Chief Financial Officer
Marc van Campen Chief Corporate Officer
Howard Dahl Chairman of the Board, Non-Executive Director
Gilles Mettetal Vice Chairman of the Board, Non-Executive Director
Arslan Huseyin Non-Executive Director
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
188 189
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
The total remuneration of executive and non-executive Board members is specified below:
(in thousands of Ukrainian
hryvnias)
(in thousands of Euros)
2021 2020 2021 2020
Remuneration of executive Board members
Viktor Ivanchyk 43 114 11 123 1 342 361
Viktor Gladky 29 766 7 402 926 240
Marc van Campen 1 318 1 166 40 40
Total remuneration of executive Board members 74 198 19 691 2 308 641
Remuneration of non-executive Board members
Howard Dahl 2 471 2 206 75 75
Gilles Mettetal 1 318 1 166 40 40
Arslan Huseyin 1 318 1 170 40 40
Total remuneration of non-executive Board members 5 107 4 542 155 155
Total remuneration of Board members 79 305 24 233 2 463 796
Key management are those having the authority and responsibility for planning, directing and controlling the activities of the
Group (totaling six persons). Executive Directors who take part in a day-to-day operational activity of the Company, are entitled to
a remuneration package consisting of an annual fixed and variable remuneration. Variable remuneration comprises long-term
incentives based on long-term incentive plan and short-term incentives in the form of bonuses. Remuneration of key management
for the year ended 31 December 2021 is UAH 79,305 thousand or EUR 2,463 thousand (2020: UAH 24,233 thousand or EUR
796 thousand). These remuneration consist of three components: fixed remuneration of UAH 26,512 thousand or EUR 848
thousand (2020: UAH 24,233 thousand or EUR 796 thousand), variable remuneration in form of bonuses which were accrued
for Mr.Ivanchyk amounting to UAH 12,012 thousand or EUR 360 thousand (2020: EUR nil) and for Mr. Gladky amounting to
UAH 8,003 thousand or EUR 240 thousand (2020: EUR nil) and expenses on the long-term incentive plan for the year ended 31
December 2021 were accrued for Mr.Ivanchyk in the amount of UAH 19,376 thousand or EUR 600 thousand and for Mr. Gladky
in the amount of UAH 13,402 thousand or EUR 415 thousand (2020: no expenses were accrued). These expenses are not part
of total 2021 remuneration disclosed in the remuneration report, as these LTI awards were not received by management. The
company does not grant loans, advance payments or guarantees to members of the Board of Directors or any family member of
such persons.
The amount due from the Company’s Directors as at 31 December 2021 is nil (31 December 2020 is nil).
16 AUDIT FEES
The following audit fees relate to the audit of 2021 and 2020 financial statements, regardless of whether the work was performed
during the financial year.
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2021
PWC -
Ukraine
PWC - Neth-
erlands
Total Net-
works
PWC -
Ukraine
PWC - Neth-
erlands
Total Net-
works
Audit of the financial statements 2 179 3 737 5 916 67 116 183
Other audit services 6 472 - 6 472 200 - 200
Tax services - - - - - -
Other non-audit services - - - - - -
8 651 3 737 12 388 267 116 383
(in thousands of Ukrainian hryvnias) (in thousands of Euros)
2020
PWC -
Ukraine
PWC - Neth-
erlands
Total Net-
works
PWC -
Ukraine
PWC - Neth-
erlands
Total Net-
works
Audit of the financial statements 6 263 2 988 9 251 203 97 300
Other audit services 3 611 - 3 611 117 - 117
Tax services - - - - - -
Other non-audit services - - - - - -
9 874 2 988 12 862 320 97 417
Other audit services include fees related to the audit of standalone financial statements of Ukrainian subsidiaries.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
190 191
ASTARTA ANNUAL REPORT 2021
ASTARTA ANNUAL REPORT 2021
17 EVENTS SUBSEQUENT
TO THE REPORTING DATE
For events subsequent to the reporting date refer to note 25 of the consolidated financial statements.
Board of Directors of Astarta Holding N.V.
06 April 2022
Amsterdam, the Netherlands
Mr. V.Ivanchyk (signed)
Mr. H.A. Dahl (signed)
Mr. V.Gladky (signed)
Mr. M.M.L.J. van Campen (signed)
Mr. G. Mettetal (signed)
Mr. H. Arslan (signed)
OTHER INFORMATION
Profit allocation and distribution in accordance with articles of association
The corporate Articles of Association lay down the following conditions regarding the appropriation of profit (sum-
mary):
Article 24
1. The profits shall be at the disposal of the General Meeting.
2. The Company can only make profit distributions to the extent its equity exceeds the paid and called up
capital plus reserves which must be maintained pursuant to the law.
3. Dividend payments may be made only after adoption of the annual accounts which show that such pay-
ments are permitted. Dividends shall be payable immediately after they have been declared, unless the
General Meeting should fix a different date when adopting the relevant resolution. Shareholders’ claims
vis-à-vis the Company in respect of the payment of a dividend shall lapse after a period of five years from
the point at which they are made payable.
4. With due observance of the provisions of paragraph 2 and provided that the requirements of paragraph 2
are fulfilled as evidenced by the interim balance sheet as mentioned in article 2:105, paragraph 4 Dutch
Civil Code (Burgerlijk Wetboek), the General Meeting may adopt a resolution to distribute an interim divi-
dend or to make distributions from a reserve which need not be maintained by law.
Within eight days of the day the payment was announced, the Company must deposit such interim balance
sheet with the Trade Register where the Company is registered. If the General Meeting adopts a resolution
to that effect, distributions may be made otherwise than in cash.
OVERVIEW
REPORT
ON OPERATIONS
SUSTAINABILITY
CORPORATE
GOVERNANCE REPORT
FINANCIAL
STATEMENTS
YCR66Q6RTYXT-116575674-72
PricewaterhouseCoopers Accountants N.V., Thomas R. Malthusstraat 5, 1066 JR Amsterdam, P.O. Box 90357,
1006 BJ Amsterdam, the Netherlands
T: +31 (0) 88 792 00 20, F: +31 (0) 88 792 96 40, www.pwc.nl
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Independent auditor’s report
Financi al Stat ements
31 Decem ber 2021
1 Januar y 2021
ASTARTA Holding N.V.
Con t r ol e
Goedkeur end
NLE000 05684 .1.1
KVK
3424889 1 000 0
Create SBR Exte nsion
1.
Am st er d am
7 Ap ril 20 22
To: the general meeting and the board of directors of Astarta Holding N.V.
Report on the financial statements 2021
Our opinion
In our opinion:
the consolidated financial statements of Astarta Holding N.V. together with its subsidiaries
(‘the Group’) give a true and fair view of the financial position of the Group as at 31 December
2021 and of its result and cash flows for the year then ended in accordance with International
Financial Reporting Standards as adopted by the European Union (‘EU-IFRS’) and with Part 9
of Book 2 of the Dutch Civil Code;
the company financial statements of Astarta Holding N.V. (‘the Company’) give a true and fair
view of the financial position of the Company as at 31 December 2021 and of its result for the
year then ended in accordance with Part 9 of Book 2 of the Dutch Civil Code.
What we have audited
We have audited the accompanying financial statements 2021 of Astarta Holding N.V., Amsterdam.
The financial statements comprise the consolidated financial statements of the Group and the
company financial statements.
The consolidated financial statements comprise:
the consolidated statement of financial position as at 31 December 2021;
the following consolidated statements for the year 2021: income statement, statement of
comprehensive income, statement of cash flows and statement of changes in equity; and
the notes to the consolidated financial statements, comprising a summary of the significant
accounting policies and other explanatory information.
The company financial statements comprise:
the company balance sheet as at 31 December 2021;
the company profit and loss account for the year ended 31 December 2021;
the notes to the company financial statements, comprising a summary of the accounting policies
applied and other explanatory information.
The financial reporting framework applied in the preparation of the financial statements is EU-IFRS
and the relevant provisions of Part 9 of Book 2 of the Dutch Civil Code for the consolidated financial
statements and Part 9 of Book 2 of the Dutch Civil Code for the company financial statements.
Astarta Holding N.V. - YCR66Q6RTYXT-116575674-72
Page 2 of 16
The basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing.
We have further described our responsibilities under those standards in the section
‘Our responsibilities for the audit of the financial statements’ of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
We are independent of Astarta Holding N.V. in accordance with the European Union Regulation on
specific requirements regarding statutory audit of public-interest entities, the ‘Wet toezicht
accountantsorganisaties’ (Wta, Audit firms supervision act), the ‘Verordening inzake de
onafhankelijkheid van accountants bij assuranceopdrachten’ (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence regulations
in the Netherlands. Furthermore, we have complied with the ‘Verordening gedrags- en beroepsregels
accountants’ (VGBA, Dutch Code of Ethics).
Material uncertainty related to going concern
We draw attention to the going concern paragraph in Note 2(b) on page 108 of the financial statements
which indicates that since 24 February 2022, the Group's operations are significantly affected by the
ongoing military invasion of Ukraine and that the magnitude of the further developments or timing of
when those actions will cease are uncertain. These conditions indicate the existence of a material
uncertainty which may cast significant doubt about the Group’s ability to continue as a going concern.
Our opinion is not modified in respect of this matter.
We designed our audit procedures in the context of our audit of the financial statements as a whole.
Our comments and observations regarding our audit approach towards going concern should be read
in this context and not as a separate opinion or conclusion on these matters.
Management’s most significant assumptions underlying their plans to address these conditions that
indicate the existence of a material uncertainty which may cast significant doubt about the Group’s
ability to continue as a going concern (hereafter: going concern risks) are:
management assume that it would be able to draw the cash from the approved credit facilities to
finance operating activities. Banks have already approved most of the credit facilities required
for the financing of Q1, Q2 and partially Q3 or the approval is in pipeline with the banks
management would be able to negotiate with the banks and attract additional credit facilities in
Q3 2022. Historically management maintained a fruitful relation with the banks and was able to
attract new financing
when preparing the actualized financial forecast, management has made the following
adjustments to the initial financial forecast:
- decreased sales volume due to possible complications with altering the available routes of
transportation, i.e. through the western border instead of the ports of the Black Sea
- decreased costs due to postponement of large investment projects and removing the non-
essential capital expenditures
Astarta Holding N.V. - YCR66Q6RTYXT-116575674-72
Page 3 of 16
In order to evaluate the appropriateness of management’s use of the going concern basis of
accounting, including management’s expectation that their plans sufficiently address the identified
going concern risks and the adequacy of the related disclosures we, with support of restructuring and
finance specialists amongst others, performed the following procedures.
Based on our knowledge obtained regarding the Group, its environment and current financial
situation, we assessed whether the information obtained regarding events or conditions that may
result in going concern risks has been included in management’s assessment. We have considered
external information such as relevant market data, our understanding of recent developments, read
the terms of contracts with banks and determined whether any have been breached and read relevant
communication with important customers and suppliers. In addition, we have inquired of
management as to their knowledge of going concern risks beyond the period of management’s
assessment.
Regarding the assumptions underlying management’s plans, we:
read the terms of contracts for the existing credit facilities as well as communications with the
banks and verified the terms and conditions of the credit facility amount. We also corroborated
the history of cooperation with the banks and verified that in the past the Group was able to
draw the approved credit facilities
analyzed the history of the management’s cooperation with the banks and verified that in the
past the Group was able to obtain additional financing when it was needed
using the publicly available information on the scale and location of Group’s operations and
location of military activities we verified that assets are not located in the areas of active conflict.
Through reading news, we verified that logistics related assumptions are consistent with the
generally made public Government announcements and industry expectations
compared the amount of expenditure related to the large investment projects and non-essential
capital expenditures in the actualized forecast to initial forecast and assessed the consistency of
aforementioned with other significant assumptions underlying the actualized forecast
corroborated the consistency of these assumptions with assumptions made by management in
other significant estimates such as forecasts used in valuation of property plant and equipment
and in valuation of biological assets
Regarding management’s plans, we:
evaluated whether the scenario applied in management’s actualized financial forecast analysis
regarding the expected outcome of management’s plans is acceptable based on corroboration of
management estimates to publicly available internet resources on open market and state
statistics portals (Bloomberg, Reuters, state statistical portals)
evaluated the possibility whether management can realize their plans timely, specifically with
regard to the spring sowing campaign, possibility to export, logistic restrictions and pricing of
commodities through corroboration of management assumptions to publicly available internet
resources on open market and state statistics portals (Bloomberg, Reuters, state statistical
portals)
assessed whether the expected outcome of management’s plans has been adequately included in
management’s cash flow forecast
evaluated the consistency of management’s business plan and the aforementioned actualized
financial forecast
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Regarding the cash flow forecast, we
evaluated the sufficiency of the liquidity headroom as included in the forecast, specifically with
regard to availability of financing to support operating activities and the major liquidity needs in
the 12 months period from the date of preparation of the financial statements
evaluated, where necessary, that financing of expected shortages in liquidity can be covered
through the disposal of current assets (i.e., available inventories) and will be sufficient for 12
months from the date of preparation of the financial statements.
To consider whether any additional facts or information have become available that may be relevant
for the identified going concern risks including management’s expectation on the sufficiency of
management’s plans to mitigate the identified risks, we:
read minutes of the management meetings, those charged with governance and relevant
committees for reference to potential financing difficulties and impact of the war on the
business
consulted publicly available information sources, like Bloomberg and Reuters
analyzed and discussed the Group’s latest available interim financial information
We evaluated whether the going concern risks including management’s plans to address the identified
risks and the most significant underlying assumptions have been sufficiently described in notes to the
financial statements. We found the disclosure in section ‘Going Concern’ on page 109 of the financial
statements, where management disclosed conditions that indicate the existence of a material
uncertainty which may cast significant doubt about the Group’s ability to continue as a going concern,
to be adequate.
Our procedures did not result in outcomes contrary to management’s assumptions and judgments
used in the application of the going concern assumption and as reflected in the Note 2(b).
Our audit approach
We designed our audit procedures with respect to the key audit matters and fraud, and the matters
resulting from that, in the context of our audit of the financial statements as a whole and in forming
our opinion thereon. The information in support of our opinion, like our findings and observations
related to individual key audit matters and the audit approach fraud risks was addressed in this
context, and we do not provide a separate opinion or conclusion on these matters.
Overview and context
Astarta Holding N.V. is a vertically integrated agro-industrial holding incorporated in Amsterdam, the
Netherlands, operating mainly in Ukraine and Cyprus. The Group specialises in sugar production, crop
growing, soybean processing and cattle farming. The Group is comprised of several components and
therefore we considered our group audit scope and approach as set out in the section ‘The scope of our
group audit’. We paid specific attention to the areas of focus driven by the operations of the Group, as
set out below.
The adverse effects of the COVID-19 pandemic on the global economy diminished during 2021
however was still observable in the specific areas like supply chain disruptions and travel restrictions.
We carefully considered this impact on the Company and took that into account in designing and
executing our audit.
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As part of designing our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements. In particular, we considered where the board of directors
made important judgements, for example, in respect of significant accounting estimates that involved
making assumptions and considering future events that are inherently uncertain. In paragraph 2(i) of
the financial statements, the Company describes the areas of judgement in applying accounting
policies and the key sources of estimation uncertainty. Given the significant estimation uncertainty
and the related higher inherent risks of material misstatement in the valuation of biological assets, we
considered this matter as key audit matter as set out in the section ‘Key audit matters’ of this report.
Another area of focus was the use of the going-concern assumption as a result of a full-scale military
invasion of Ukraine initiated by Russia on 24 February 2022. Reference is made to the paragraph
‘Material uncertainty related to going concern’.
In executing our audit, we ensured that the audit team included the appropriate skills and
competences which are needed for the audit of an agricultural company. We therefore included
specialists in the areas of restructuring and finance, information technology, taxation, and experts in
valuation in our team.
The outline of our audit approach was as follows:
Materiality
Overall materiality: UAH 156.3 million (EUR 4.8 million).
Audit scope
We conducted audit work over eighteen components and covered all
significant components of the Group.
Site visits were conducted in Ukraine.
Because of the centralised structure, the entire Group was audited by
one engagement team.
Audit coverage: 99% of consolidated revenue, 97% of consolidated
total assets and 97% of consolidated profit before tax.
Key audit matters
Valuation of biological assets.
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Materiality
The scope of our audit is influenced by the application of materiality, which is further explained in the
section ‘Our responsibilities for the audit of the financial statements’.
Based on our professional judgement we determined certain quantitative thresholds for materiality,
including the overall materiality for the financial statements as a whole as set out in the table below.
These, together with qualitative considerations, helped us to determine the nature, timing and extent
of our audit procedures on the individual financial statement line items and disclosures and to
evaluate the effect of identified misstatements, both individually and in aggregate, on the financial
statements as a whole and on our opinion.
Overall group
materiality
UAH 156.3 million (EUR 4.8 million) (2020: UAH 129.2 million (EUR 4.2
million)).
Basis for determining
materiality
We used our professional judgement to determine overall materiality. As a basis for
our judgement we used 1% of revenue.
Rationale for
benchmark applied
We used revenue as the primary benchmark, based on our analysis of the common
information needs of users of the financial statements. We believe that total
revenue is an important metric for the financial performance of the Group.
Although we believe that the profit of the business is one of the key performance
measures, at this stage revenue is the most objective benchmark. Revenue is the
least affected by accounting estimates and is relatively stable.
On this basis, we believe that revenue is an important metric for the financial
performance of the Group.
Profit before tax was not considered as an appropriate benchmark as it was highly
volatile over the recent years considering turbulence of market prices for
agricultural produce which are also used as input for valuation of biological assets
that impact the operating income. At the same time, operating and non-operating
costs are not impacted to the same extent by the market sugar prices but are
significantly affected by the impairment of property, plant and equipment as well as
exchange rate fluctuations. We chose 1%, which in our experience is within the
range of acceptable quantitative materiality thresholds for this benchmark.
Component
materiality
To each component in our audit scope, we, based on our judgement, allocate
materiality that is less than our overall group materiality. The range of materiality
allocated across components was between UAH 33 million (EUR 1 million) and
UAH 156.3 million (EUR 4.8 million).
We also take misstatements and/or possible misstatements into account that, in our judgement, are
material for qualitative reasons.
We agreed with the board of directors that we would report to them misstatements identified during
our audit above UAH 15.6 million (EUR 0.48 million) (2020: UAH 12.9 million (EUR 0.42 million)) as
well as misstatements below that amount that, in our view, warranted reporting for qualitative
reasons.
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The scope of our group audit
Astarta Holding N.V. is the parent company of a group of entities operating primarily in Ukraine,
Switzerland and Cyprus. The financial information of this Group is included in the consolidated
financial statements of Astarta Holding N.V., refer to the Note 2(c) to the consolidated financial
statements for the detailed Group structure.
We tailored the scope of our audit to ensure that we, in aggregate, provide sufficient coverage of the
financial statements for us to be able to give an opinion on the financial statements as a whole, taking
into account the management structure of the Group, the nature of operations of its components, the
accounting processes and controls, and the markets in which the components of the Group operate.
In establishing the overall group audit strategy and plan, we determined the type of work required to
be performed at component level.
The group audit included six components in Ukraine and Cyprus, which were subjected to audits of
their complete financial information, as those components are individually financially significant to
the Group. Additionally, we selected twelve components for specified audit procedures to achieve
appropriate coverage on financial line items in the consolidated financial statements.
In total, in performing these procedures, we achieved the following coverage on the financial line
items:
Revenue 99%
Total assets 97%
Profit before tax 97%
None of the remaining components represented more than 1% of total group revenue or 1% of total
group assets. For those remaining components we performed, among other things, analytical
procedures to corroborate our assessment that there were no significant risks of material
misstatements within those components.
The Group’s operating activities are primarily located in Ukraine. The Group accounting function is
centralised in Kyiv and the Group is primarily managed as a single operating unit with multiple
operating segments. The Group uses a centralised IT system for its business processes and final
reporting, including consolidation. Therefore, all of the audit work was performed by the Group
engagement team including the audit of the Group’s consolidation and financial statements
disclosures.
By performing the procedures above, we have been able to obtain sufficient and appropriate audit
evidence on the Group’s financial information, as a whole, to provide a basis for our opinion on the
financial statements.
The impact on the climate change on our audit
Sustainability is a core value at Astarta Holding N.V., viewed by management central to the continual
growth and success of any business. In 2021 management of Astarta Holding N.V. further expanded
the climate change related risk assessment. We refer to sections ‘Task Force on Climate-related
Financial Disclosures’, ’Governance’, ‘Strategy’, ‘Risk management’, ‘Climate related risks relevant to
Astarta’, ‘Metrics and Targets’ and ‘EU Taxonomy Disclosure’ on the pages of the Annual report where
management defined potential physical as well as transitional risks, strategy, risk governance and their
ongoing initiatives with respect to development of targets and metrics.
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Management acknowledged the complexity of regulatory environment and stakeholders’ expectations.
In adopting its strategic approach to sustainability management was focusing on addressing material
external risks, to become more resilient and adaptable in the face of challenges such as climate change
and creating a space for innovation.
Climate change initiatives and commitments impact the preparation of the financial statements in a
variety of ways, all with inherent uncertainties. In note 2(i) ‘Critical accounting estimates and
judgements in applying accounting policies’ to the consolidated financial statements, management
pointed out that climate-related risks do not have a material impact on the financial statements for the
financial year ended 31 December 2021, however concluded that this will remain an area of increased
focus in the upcoming reporting periods.
As we have not been engaged in expressing assurance over the sustainability reporting, our procedures
in this context consisted primarily of making inquiries with officers of the entity and determining the
plausibility of the information reported. During our planning procedures, we have made enquiries of
management to understand and assess the extent of potential impact of climate related risk on the
financial statements.
We challenged the appropriateness of management’s assessment of the potential impact on major
accounting estimates. The impact of climate related risks is not considered to be a separate key audit
matter.
Audit approach fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to
fraud. During our audit we obtained an understanding of the entity and its environment and the
components of the system of internal control, including management’s process for responding to the
risks of fraud and monitoring the system of internal control and how the one-tier board of directors
exercises oversight, as well as the outcomes. We refer to section ‘Risk management’ (‘Report on
operations’) and section ‘Internal control’ (‘Corporate governance report’) of the Annual report for
description of governance structure and policies in place on which management relies when managing
the risk of fraud.
We further evaluated fraud risk factors with respect to financial reporting fraud, misappropriation of
assets and bribery and corruption. We assessed whether those factors indicate that a risk of material
misstatement due to fraud is present. In doing this:
We performed an inquiry of the audit committee and the board of directors as to fraud risks and
related party transactions to identify the areas of their concerns in relation to fraud.
We inquired with executive management and accounting personal as to whether they have any
knowledge of (suspected) fraud, their views on overall fraud risks within the Group and their
perspectives on the Group’s mitigating controls addressing the risk of fraud.
We assessed the matters reported through the Group’s whistleblowing and complaints
procedure and results of management’s investigation and follow-up on such matters.
We assessed the IT environment around key systems. We paid specific attention to the access
safeguards in the IT system and the possibility that these lead to violations of the segregation of
duties.
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Based on the fraud risk factors identified we performed the following specific procedures over the
identified fraud risks:
[]
Identified fraud risks
Our audit work and observations
Risk of management override of
controls
It is generally presumed that
management is in a unique
position to perpetrate fraud
because of the available
opportunity to manipulate
accounting records and prepare
fraudulent financial statements by
overriding controls that otherwise
appear to be operating effectively.
Management measures
performance of the Group through
monitoring of EBITDA, revenue
and cash flow, which are
considered to be one of the key
performance indicators.
A risk of override or bypassing of
controls as management may be
inclined to ensure targets are met,
has been identified.
In this context, we paid specific
attention to non-routine
transactions and areas of
significant management
estimations where management
bias may result in fraudulent
reporting.
To address this specific risk, we executed the following strategy:
Where relevant to our audit, we evaluated the design and
effectiveness of controls in the processes of generating and
processing journal entries. We assessed whether deficiencies in
controls may create additional opportunities for fraud and
incorporated respective corroborative procedures in our audit
approach.
We considered the outcome of our audit procedures over the
estimates and significant accounting areas and assessed whether
control deficiencies and misstatements identified were indicative
of fraud. Where necessary, we planned and performed additional
auditing procedures to ensure that fraud risk is sufficiently
addressed in our audit.
We evaluated key accounting estimates and judgements used in
key accounting areas (like valuation of biological assets,
impairment of property plant and equipment) for biases,
including retrospective reviews of prior year’s estimates where
available. Further reference is made to key audit matters in this
auditor’s report.
We performed data analysis and focused on journal entries
related to the fraud risk factors identified during fraud risk
assessment. Where we identified instances of unexpected journal
entries, we performed additional audit procedures to address
each identified risk.
We evaluated whether the business rationale (or lack thereof) of
the significant transactions concluded in 2021 suggests that the
Group may have been entered into to engage in fraudulent
financial reporting or to conceal misappropriation of assets.
We performed physical observation of the Group’s property,
plant and equipment, biological assets and inventories.
We verified the appropriateness of the authorisation of the
purchase agreements.
We incorporated an element of unpredictability in the nature
timing and extent of procedures.
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We performed substantive testing procedures over the
consolidation entries.
Our audit procedures did not lead to specific indications of fraud
or suspicions of fraud with respect to management override of
the internal controls.
Risk of fraud in revenue recognition
Management performance is
linked to financial results, thus
there may be intention from
management's side to improve
Group's performance through
fictitious revenue postings,
premature revenue recognition or
deliberate manipulation with
manual inputs to invoice or
journal entries.
To address this specific risk, we executed the following strategy:
We discussed with the audit committee and executive
management (e.g. the chief financial officer) the increased risk of
overriding or bypassing controls in order to meet certain key
performance indicators.
We discussed and inquired with management with respect to the
tone at the top, to assess to what extent not meeting targets have
an impact on career opportunities or bonuses within the
Company, and whether they have any knowledge of (suspected)
fraud.
In our conversations we addressed their views on overall fraud
risks within the Group and their perspectives on the Groups
mitigating controls addressing the risk of fraud in revenue.
We updated our understanding of the revenue and receivable
process through performing an end-to end walkthrough of the
process whereby identifying individual revenue streams
applicable to the Company and its subsidiaries.
We assessed the IT environment around key systems, including
IT dependent controls related to the revenue and receivables
cycle. We also assessed the design and effectiveness of the
internal control measures related to revenue recognition and
processing journal entries related to revenue.
Using data analysis, we identified revenue reversal entries
accounted for close to the year end and substantively tested them
to verify that their nature did not represent fraudulent
transactions or reporting.
We performed substantive audit procedures to assess whether
IFRS 15 criteria for recognising revenue in 2021, were met.
Our audit procedures did not lead to specific indications of fraud
or suspicions of fraud with respect to the accuracy of the revenue
reporting.
[]
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Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
the audit of the financial statements. We have communicated the key audit matters to the board of
directors. The key audit matters are not a comprehensive reflection of all matters identified by our
audit and that we discussed. In this section, we described the key audit matters and included a
summary of the audit procedures we performed on those matters.
In addition to the matter described in the section ‘Material uncertainty related to going concern’ we
have determined the matter described below to be the key audit matter to be communicated in our
report.
Impairment of property plan and equipment in sugar segment was included in the list of key audit
matters in 2020. In 2021, this matter no longer required a significant auditor attention due to recovery
of sugar segment. This positive market development resulted in a significant headroom between the
recoverable amount, being value-in-use, and the carrying amount at the year end and considerably
rebutted the sensitivity of the impairment model to the one of key assumptions - sugar selling price.
Taking the above into consideration, the key audit matter for impairment of property plant and
equipment in sugar segment has been removed from our audit opinion.
Key audit matter
Our audit work and observations
Valuation of biological assets
Refer to Notes 2(i) and 7 to the
consolidated financial
statements for related disclosures
The Group measures biological assets (crops and
livestock) at fair value less costs to sell in accordance
with IAS 41 Agriculture and IFRS 13 Fair Value
Measurement. The Group has current biological assets,
comprised of winter crops of UAH 1.086 million
(EUR 35 million) and rapeseeds of UAH 196 million
(EUR 6 million) as well as non-current biological assets,
mainly consisting of cattle UAH 857 million
(EUR 28 million).
The Group assesses the fair value less cost to sell of its
biological assets based on the discounted cash flow
technique. This valuation is significant to our audit
because the assessment process is complex and
judg
emental.
The key assumptions used in the preparation of future
cash flow (see Note 7 to the consolidated financial
statements) are:
expected yields;
prices;
discount rates.
Due to the absence of an active market it is based on
unobservable data from Group’s internal agricultural,
sales and financial reporti
ng experts who accumulate
Among other audit procedures, we performed an
evaluation of the Group’s accounting policy and
methodology for valuation of biological assets.
We verified that the valuation methods used are in
accordance with IAS 41, IFRS 13 and consistent with
international valuation standards and industry norms.
We assessed the competence, capabilities and
experience of the preparers of the valuation, and
verified their
qualifications.
We challenged management’s assumptions with
reference to historical data (yields) and, where
applicable, external benchmarks (prices) and market
data noting the assumptions used fell within an
acceptable range.
Further, we compared those key assumptions to the
ones used in the next year budget approved by the
Budget Committee; and historical performance, where
considered relevant, and evaluated rationale for any
change.
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Key audit matter
Our audit work and observations
this information based on prior years’ performance and
publicly available resources, i.e. market analysts’
forecasts and industry expert reports, therefore
inherently susceptible to the risk of material
misstatement.
Therefore, we consider valuation of biological assets to
be a key audit matter.
We involved our valuation experts to evaluate the
reasonableness and appropriateness of the discount
rates.
We reviewed a sensitivity analysis of the significant
assumptions to evaluate their impact on and adequacy
of disclosures made relating to the fair value less costs
to sell of biological assets.
We verified the mathematical accuracy of the valuation
model and the adequacy of the Group’s
disclosures in Note 7 to the consolidated financial
statements.
No material misstatements or exceptions were noted as
a result of our audit procedures.
Report on the other information included in the annual report
The annual report contains other information (the ‘Other Information’). This includes all information
in the annual report in addition to the financial statements and our auditor’s report thereon.
Based on the procedures performed as set out below, we conclude that the other information:
is consistent with the financial statements and does not contain material misstatements;
contains all the information regarding the directors’ report and the other information that is
required by Part 9 of Book 2 and regarding the remuneration report required by the
sections 2:135b and 2:145 subsection 2 of the Dutch Civil Code.
We have read the other information. Based on our knowledge and the understanding obtained in our
audit of the financial statements or otherwise, we have considered whether the other information
contains material misstatements.
By performing our procedures, we comply with the requirements of Part 9 of Book 2 and
section 2:135b subsection 7 of the Dutch Civil Code and the Dutch Standard 720. The scope of such
procedures was substantially less than the scope of those procedures performed in our audit of the
financial statements.
The board of directors is responsible for the preparation of the other information, including the
directors’ report and the other information in accordance with Part 9 of Book 2 of the Dutch Civil
Code. The board of directors is responsible for ensuring that the remuneration report is drawn up and
published in accordance with sections 2:135b and 2:145 subsection 2 of the Dutch Civil Code.
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Report on other legal and regulatory requirements and ESEF
Our appointment
We were appointed as auditors of Astarta Holding N.V. following the passing of a resolution by the
shareholders at the annual general meeting held on 2 August 2019. Our appointment has been
renewed annually by the shareholders.
European Single Electronic Format (ESEF)
Astarta Holding N.V. has prepared the annual report, including the financial statements, in ESEF.
The requirements for this format are set out in the Commission Delegated Regulation (EU) 2019/815
with regard to regulatory technical standards on the specification of a single electronic reporting
format (these requirements are hereinafter referred to as: the RTS on ESEF).
In our opinion, the annual report prepared in XHTML format, including the partially marked-up
consolidated financial statements, as included in the reporting package by Astarta Holding N.V.,
complies, in all material respects, with the RTS on ESEF.
The board of directors is responsible for preparing the annual report, including the financial
statements, in accordance with the RTS on ESEF, whereby the board of directors combines the various
components into a single reporting package. Our responsibility is to obtain reasonable assurance for
our opinion on whether the annual report in this reporting package complies with the RTS on ESEF.
Our procedures, taking into account Alert 43 of the NBA (Royal Netherlands Institute of Chartered
Accountants), included amongst others:
Obtaining an understanding of the entity’s financial reporting process, including the preparation
of the reporting package.
Obtaining the reporting package and performing validations to determine whether the reporting
package, containing the Inline XBRL instance document and the XBRL extension taxonomy
files, has been prepared, in all material respects, in accordance with the technical specifications
as included in the RTS on ESEF.
Examining the information related to the consolidated financial statements in the reporting
package to determine whether all required mark-ups have been applied and whether these are in
accordance with the RTS on ESEF.
No prohibited non-audit services
To the best of our knowledge and belief, we have not provided prohibited non-audit services as
referred to in article 5(1) of the European Regulation on specific requirements regarding statutory
audit of public-interest entities.
Services rendered
The services, in addition to the audit, that we have provided to the Company or its controlled entities,
for the period to which our statutory audit relates, are disclosed in Note 15 to the company financial
statements.
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Responsibilities for the financial statements and the audit
Responsibilities of the board of directors
The board of directors is responsible for:
the preparation and fair presentation of the financial statements in accordance with EU-IFRS
and Part 9 of Book 2 of the Dutch Civil Code; and for
such internal control as the board of directors determines is necessary to enable the preparation
of the financial statements that are free from material misstatement, whether due to fraud or
error.
As part of the preparation of the financial statements, the board of directors is responsible for
assessing the Company’s ability to continue as a going concern. Based on the financial reporting
frameworks mentioned, the board of directors should prepare the financial statements using the
going-concern basis of accounting unless the board of directors either intends to liquidate the
Company or to cease operations or has no realistic alternative but to do so. The board of directors
should disclose in the financial statements any event and circumstances that may cast significant
doubt on the Company’s ability to continue as a going concern.
The non-executive directors that are part of the one-tier board of directors are responsible for
overseeing the Company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our responsibility is to plan and perform an audit engagement in a manner that allows us to obtain
sufficient and appropriate audit evidence to provide a basis for our opinion. Our objectives are to
obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high but not absolute level of assurance, which makes it possible that we
may not detect all material misstatements. Misstatements may arise due to fraud or error. They are
considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of the financial statements.
Materiality affects the nature, timing and extent of our audit procedures and the evaluation of the
effect of identified misstatements on our opinion.
A more detailed description of our responsibilities is set out in the appendix to our report.
Amsterdam, 8 April 2022
PricewaterhouseCoopers Accountants N.V.
/PwC_P artner _Signat ure/
Original has been signed by A.G.J. Gerritsen RA
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Appendix to our auditor’s report on the financial statements
2021 of Astarta Holding N.V.
In addition to what is included in our auditor’s report, we have further set out in this appendix our
responsibilities for the audit of the financial statements and explained what an audit involves.
The auditor’s responsibilities for the audit of the financial statements
We have exercised professional judgement and have maintained professional scepticism throughout
the audit in accordance with Dutch Standards on Auditing, ethical requirements and independence
requirements. Our audit consisted, among other things of the following:
Identifying and assessing the risks of material misstatement of the financial statements, whether
due to fraud or error, designing and performing audit procedures responsive to those risks, and
obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the intentional override of internal control.
Obtaining an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control.
Evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the Board of Directors.
Concluding on the appropriateness of the board of directors’ use of the going-concern basis of
accounting, and based on the audit evidence obtained, concluding whether a material
uncertainty exists related to events and/or conditions that may cast significant doubt on the
Company’s ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report
and are made in the context of our opinion on the financial statements as a whole. However,
future events or conditions may cause the Company to cease to continue as a going concern.
Evaluating the overall presentation, structure and content of the financial statements, including
the disclosures, and evaluating whether the financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
Considering our ultimate responsibility for the opinion on the consolidated financial statements, we
are responsible for the direction, supervision and performance of the group audit. In this context, we
have determined the nature and extent of the audit procedures for components of the Group to ensure
that we performed enough work to be able to give an opinion on the financial statements as a whole.
Determining factors are the geographic structure of the Group, the significance and/or risk profile of
group entities or activities, the accounting processes and controls, and the industry in which the Group
operates. On this basis, we selected group entities for which an audit or review of financial information
or specific balances was considered necessary.
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We communicate with the board of directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit. In this respect, we also issue an additional report to the audit
committee in accordance with article 11 of the EU Regulation on specific requirements regarding
statutory audit of public-interest entities. The information included in this additional report is
consistent with our audit opinion in this auditor’s report.
We provide the board of directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
actions taken to eliminate threats or safeguards applied.
From the matters communicated with the board of directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, not communicating the
matter is in the public interest.