Ovostar Union Public : 05.07.2022 pdf9.18 mb Annual Report for the year ended 31 December 2021

OVOSTAR UNION ANNUAL REPORT

FINANCIAL YEAR ENDED 31 DECEMBER 2021

CONTENTS

MANAGEMENT REPORT
Corporate summary	5
Market Overview	10
Key Financials	12
Segment Activities	13
Financial Results	16
Outlook for 2022	18
Human Resources	19
Risk Management and Internal Control	20
Shareholders and Share Information	26

CORPORATE GOVERNANCE
The Board of Directors	28
Committees of the Board of Directors	32
Meetings with Shareholders	33
Corporate Governance and Control	35
Non-financial Information	37

FINANCIAL STATEMENTS
Consolidated financial statements	40
Company financial statements	85

MANAGEMENT REPORT 1

CEO's

Statement

Dear Shareholders,

While reporting on the results of the financial year 2021 we have to at all times bear in mind the tragedy that befell Ukraine on February 24, 2022. Once a peaceful flourishing country was blatantly attacked by the Russian military forces who ever since keep bringing chaos and destruction to our homes and taking lives of our people. On the background of these horrible events Ovostar Union strives to make its modest contribution to the common effort aimed at defending Ukraine. As a producer of basic foods like eggs and egg products, we realize how important our work is for the country's food security. Since the beginning of the invasion our productions sites never stopped operating producing and delivering nutrition to the people. I want to thank everyone from Ovostar team for their dedication and courage that has been leading the company through the hardest of times. I also

want to say words of appreciation to our suppliers and customers and, of course, to the brave men and women who are fighting for our victory over the enemy. Back in 2021 Ovostar had many plans for the year ahead. The company had progress in terms of operational efficiency that together with favorable market conditions laid solid basis for further development. The Group became #1 egg producer in Ukraine and remained one of the biggest exporters to Europe. Today, however, like most Ukraine-located businesses we have to shift focus and adjust the strategy to the new business environment full of risks and uncertain- ties. We believe that the day is close when the justice will be restored and the enemy defeated.

Sincerely,

Borys Bielikov

2021 ANNUAL REPORT 3

MANAGEMENT REPORT

MANAGEMENT REPORT 1

CORPORATE SUMMARY

COMPANY OVERVIEW

Ovostar Union Public Company Limited is a holding entity originally incorporated under the laws of the Netherlands in 2011 and re- domiciled to Cyprus in 2018. It consolidates companies with production assets located in Ukraine and non-Ukrainiantrading companies in Latvia, British Virgin Islands and United Arab Emirates (hereinafter referred to as "we, us"). Our shares have been quoted on the Warsaw Stock Exchange since June 2011.

Our goal has been to produce ecologically clean and healthy food for our clients in Ukraine and abroad. We are growing organically by gradually increasing the volume of eggs produced and expanding the range of egg products offered. For over a decade Ovostar Union has been one of leaders of the local egg industry belonging to the top 3 producers in Ukraine.

With focus on developing the export mar- kets, we are expanding our sales geography supplying shell eggs and egg products of consistently high quality around the countries of Europe, Middle East, Africa and Asia.

Within the egg segment, we possess shell egg portfolio of over 20 sub-brands and supply our branded eggs to the largest retail chains in Ukraine. As a result of export markets development we are gradually increasing the deliveries of shell eggs outside of Ukraine.

Within the egg products segment, we offer the full range of egg products of both liquid and dry forms. We enjoy loyalty of the largest food processing companies in Ukraine and abroad by adjusting our products to the clients' needs while maintaining the superior quality.

2021 ANNUAL REPORT 5