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AB LINAS AGRO GROUP

CONSOLIDATED FINANCIAL STATEMENTS


FOR THE 6 MONTH PERIOD OF THE YEAR 2011/2012 (UNAUDITED)

PREPARED ACCORDING TO ADDITIONAL INFORMATION PREPARING AND PRESENTATION INSTRUCTIONS ISSUED BY THE SECURITIES COMMISSION OF THE REPUBLIC OF LITHUANIA

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Notes ASSETS Non-current assets Intangible assets Property, plant and equipment Investment property Animals and livestock Non-current financial assets Investments into associates Investments into joint ventures Other investments Prepayments for financial assets Non-current receivables Non-current receivables from related parties Total non-current financial assets Deferred income tax asset Total non-current assets Current assets Crops Inventories Prepayments Accounts receivable Trade receivables Receivables from related parties Other accounts receivable Total accounts receivable Other current assets Cash and cash equivalents Total current assets Total assets 16

As of 31 December 2011

As of 30 June 2011

5 6 7

625 136,993 9,087 13,905 457 26,886 305 5,781 1,359 34,788 5,852 201,250

366 123,208 9,012 14,007 347 25,821 365 2,223 10,317 1,359 40,432 8,797 195,822

8 8 9 9 16

5,393 178,188 20,256 120,702 8,310 10,682 139,694 6,189 37,882 387,602 588,852

29,682 128,226 49,674 160,768 3,899 29,257 193,924 5,284 7,624 414,414 610,236 (contd on the next page)

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (contd)


Notes EQUITY AND LIABILITIES Equity attributable to equity holders of the parent Share capital Share premium Legal reserve Reserve for own shares Foreign currency translation reserve Retained earnings Total equity attributable to equity holders of the parent Non-controlling interest Total equity Liabilities Non-current liabilities Grants and subsidies Non-current borrowings Finance lease obligations Deferred income tax liability Other non-current liabilities Total non-current liabilities Current liabilities Current portion of non-current borrowings Current portion of finance lease obligations Current borrowings Trade payables Payables to related parties Income tax payable Derivative financial instruments Other current liabilities Total current liabilities Total equity and liabilities 10, 16 10 16 15,170 798 150,109 41,409 3,249 4,489 26,881 242,105 588,852 14,814 1,028 180,884 47,280 5,482 2,933 618 32,749 285,788 610,236 10 8,961 29,410 1,875 839 3,701 44,786 9,473 28,295 1,789 2,613 2,329 44,499 1 1 158,940 79,545 4,401 1,600 (757) 36,732 280,461 21,500 301,961 158,940 79,545 4,151 (3,208) 23,930 263,358 16,591 279,949 As of 31 December 2011 As of 30 June 2011

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


(for the period 1 July to 31 December)
Notes 2011/2012 2010/2011 6 month 6 month Sales Cost of sales Gross profit Operating (expenses) Other income Other (expenses) Operating profit Income from financing activities (Expenses) from financing activities Share of profit of associates Share of profit of joint ventures Profit before tax Income tax Net profit Attributable to: Equity holders of the parent Non-controlling interest Basic and diluted earnings per share (LTL) Net profit Other comprehensive income Exchange differences on translation of foreign operations Total comprehensive income Attributable to: Equity holders of the parent Non-controlling interest 21,817 3,992 25,809 11,412 (863) 10,549 14 14 4 11 12 13 13 868,668 (814,473) 54,195 (27,313) 5,052 (247) 31,687 748 (5,271) 128 1,104 28,396 (6,762) 21,634 796,135 (753,931) 42,204 (20,734) 619 (4,728) 17,361 1,094 (4,217) 56 1,368 15,662 (2,835) 12,827

19,366 2,268 21,634 0.14 21,634 4,175 25,809

12,851 (24) 12,827 0.08 12,827 (2,278) 10,549

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


(for the period 1 October to 31 December)
Notes 2011/2012 2010/2011 2Q 2Q Sales Cost of sales Gross profit Operating (expenses) Other income Other (expenses) Operating profit Income from financing activities (Expenses) from financing activities Share of profit of associates Share of profit of joint ventures Profit before tax Income tax Net profit Attributable to: Equity holders of the parent Non-controlling interest Basic and diluted earnings per share (LTL) Net profit Other comprehensive income Exchange differences on translation of foreign operations Total comprehensive income Attributable to: Equity holders of the parent Non-controlling interest 7,198 1,418 8,616 (1,793) 340 (1,453) 14 14 4 11 12 13 13 424,735 (402,123) 22,612 (15,616) 3,857 (105) 10,748 373 (2,018) 45 (29) 9,119 (2,583) 6,536 417,242 (405,161) 12,081 (10,807) 8 (1,095) 187 648 (2,283) 17 (512) (1,943) (142) (2,085)

5,954 582 6,536 0.04 6,536 2,080 8,616

(2,201) 116 (2,085) (0.014) (2,085) 632 (1,453)

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Notes

Share capital

Equity attributable to equity holders of the parent Share Legal Reserve for Foreign Retained Subtotal Nonpremium reserve acquisition currency earnings controlling of own translation interest shares reserve 79,545 79,545 79,545 79,545 4,100 (51) 4,151 4,151 250 4,401 (133) (1,439) (1,439) (1,572) (3,208) 2,451 2,451 (757) 8,079 12,851 12,851 (3,500) (51) 596 17,975 23,930 19,366 19,366 (4,714) (250) (1,600) 36,732 250,531 12,851 (1,439) 11,412 (3,500) 596 259,039 263,358 19,366 2,451 21,817 (4,714) 280,461 12,817 (24) (839) (863) (611) 10,918 (2,987) 19,274 16,591 2,268 1,724 3,992 938 (21) 21,500

Total

Balance as of 1 July 2010 Net profit for the year Other comprehensive income Total comprehensive income Dividends declared by Rosenkrantz A/S Dividends declared by Company Minority interest arising on acquisition of subsidiaries Reserves made Acquisition of minority interest Balance as of 31 December 2010 Balance as of 1 July 2011 Net profit for the year Other comprehensive income Total comprehensive income Acquisition of minority interest Declared dividends Reserves made Reserves made Balance as of 31 December 2011

158,940 158,940 158,940 158,940

263,348 12,827 (2,278) 10,549 (611) (3,500) 10,918 (2,391) 278,313 279,949 21,634 4,175 25,809 (3,776) (21) 301,961

1,600 1,600

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF CASH FLOW


Notes 2011/2012 6 month 2010/2011 6 month

Cash flows from (to) operating activities Net profit (loss) Adjustments for non-cash items: Depreciation and amortization Subsidies amortization Share of profit of associates and joint ventures (Gain) on disposal of property, plant and equipment Loss form acquisition of subsidiary Loss (gain) from disposal of investments Change in accrued expenses Change in allowance for receivables and prepayments Change in inventories write down to net realizable value Change in fair value of biological assets Change in impairment of investments Change in deferred income tax Current income tax expenses Expenses (income) from change in fair value of financial instruments Change of provision for onerous contracts Change in foreign currency translation reserve Dividend (income) Interest (income) Interest expenses Changes in working capital: Decrease in biological assets (Increase) in inventories Decrease in prepayments (Increase) in trade and other accounts receivable (Increase) in restricted cash Increase in trade and other accounts payable Income tax (paid) Net cash flows from (to) operating activities 24,552 (48,604) 29,417 54,372 (3,453) (14,869) (5,576) 77,651 13,337 (44,302) (9,917) (64,538) (20,621) (799) (1,203) (105,084) (contd on the next page) 3 21,643 5,453 (716) (1,214) (87) (1,066) 4,007 1,956 110 23 1,171 6,321 (267) (36) (748) 5,271 41,812 12,827 5,227 (741) (1,424) (89) 670 253 802 406 (25) (2,272) (22) (2,210) 4,803 3,910 (2,279) (1,094) 4,217 22,959

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

CONSOLIDATED STATEMENT OF CASH FLOW (contd)

Notes Cash flows from (to) investing activities (Acquisition) of intangible assets, property, plant and equipment and investment property Proceeds from sale of intangible assets, property, plant and equipment and investment property Acquisition of subsidiaries (less received cash balance in the Group) Disposal of subsidiaries (Acquisition) of non-controlling interests and other investments Disposal of joint venture Loans (granted) Repayment of granted loans Interest received Dividend received Net cash flows (to) investing activities Cash flows from (to) financing activities Proceeds from loans (Repayment) of loans Finance lease (payments) Interest (paid) Dividends (paid) to non-controlling shareholders Dividends (paid) to shareholders of the Company Net cash flows from (to) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year Supplemental information of cash flows: Non-cash investing activity: Property, plant and equipment acquisitions financed by finance lease Property, plant and equipment acquisitions financed by grants and subsidies

2011/2012 6 month

2010/2011 6 month

(13,469) 156 3 (1,704) 2,007 (370) 1,004 930 36 (11,410)

(6,537) 320 7,657 477 (2,390) (150) 7,879 738 7,994

198,352 (227,276) (641) (6,418) (35,983) 30,258 7,624 37,882

448,353 (353,403) (542) (4,455) (611) (3,500) 85,842 (11,248) 34,014 22,766

484 383

452 734

The accompanying notes are an integral part of these financial statements.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

NOTES TO THE FINANCIAL STATEMENTS


1. GENERAL INFORMATION
AB Linas Agro Group (hereinafter the Company or the parent) is a public limited liability company registered in the Republic of Lithuania. The Company was registered on 27 November 1995. On 12 September 2008 the Company changed its name from UAB Agriveta to AB Linas Agro Group and the legal form from private to public limited liability company. The address of its registered office is as follows: Smlyns Str. 2C Panevys Lithuania The principal activities of the Group are described in Note 4. The financial year of the Group starts on 1 July of the calendar year and ends on 30 June of the following calendar year. As of 31 December and as of 30 June 2011 the shareholders of the Company were: As of 31 December 2011 Number of Percentage shares held 86,081,551 54.16% 22,774,330 14.33% 17,049,995 10.73% 11,063,527 6.96% 21,970,995 13.82% 158,940,398 100.00% As of 30 June 2011 Number of Percentage shares held 86,081,551 54.16% 21,221,849 13.35% 17,049,995 10.73% 9,816,217 6.18% 24,770,786 15.58% 158,940,398 100.00%

Akola ApS (Denmark) Skandinaviska Enskilda Banken AB (Sweden) Darius Zubas Swedbank (Estonia) Clients Other shareholders (private and institutional investors) Total

All the shares of the Company are ordinary shares with the par value of LTL 1 each as of 31 December 2011 (LTL 1 each as of 30 June 2011) and were fully paid as of 31 December and as of 30 June 2011. The Company, its subsidiaries and other related companies did not hold any shares of the Company as of 31 December and as of 30 June 2011. All of the Companys 158,940,398 ordinary shares are included in the Official list of NASDAQ OMX Vilnius stock exchange (ISIN code LT0000128092). The Companys trading ticker in NASDAQ OMX Vilnius stock exchange is LNA1L. As of 31 December 2011 the number of employees of the Group was 803 (775 as of 30 June 2011).

Changes in share capital during the year ended 30 June 2011 No changes in share capital occurred during the year ending 30 June 2011. Changes in share capital during the year ended 31 December 2011 No changes in share capital occurred during the year ending 31 December 2011.

2. ACCOUNTING PRINCIPLES
These financial statements were prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union (hereinafter the EU), which include IAS 34. In all material respects, the same accounting principles have been followed as in the preparation of financial statements for 2010/2011 financial year.

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

3. GROUP STRUCTURE AND CHANGES IN THE GROUP


As of 31 December and as of 30 June 2011 the Company held these directly and indirectly controlled subsidiaries (hereinafter the Group):

Place of registration

Effective share of the stock held by the Group 31 December 30 June 2011 2011

Main activities

Investments into directly controlled subsidiaries


AB Linas Agro UAB Linas Agro Konsultacijos B Landvesta 1 B Landvesta 2 B Landvesta 3 B Landvesta 4 B Landvesta 5 B Landvesta 6 PC-JS UKRAGRO NPK Lithuania Lithuania Lithuania Lithuania Lithuania Lithuania Lithuania Lithuania Ukraine 100% 100% 100% 100% 100% 100% 100% 100% 58.04% 100% 100% 100% 100% 100% 100% 100% 100% 58.04% Wholesale trade of grains and oilseeds, feedstuffs and agricultural inputs Management of the subsidiaries engaged in agriculture Rent and management of agricultural purposes land Rent and management of agricultural purposes land Rent and management of agricultural purposes land Rent and management of agricultural purposes land Rent and management of agricultural purposes land Rent and management of agricultural purposes land Manufacturing of fertilizers, wholesale of grains and oilseeds

Investments into indirectly controlled subsidiaries (through AB Linas Agro)


Wholesale trade of grains and oilseeds, agricultural programs Not operating company Management services Preparation and warehousing of grains for trade Wholesale trade of grains and oilseeds, feedstuffs Manufacturing of lignin

SIA Linas Agro UAB Gerera UAB Linas Agro Grd Centras UAB Linas Agro Grd Centras KB Linas Agro A/S UAB Lignineko

Latvia Lithuania Lithuania Lithuania Denmark Lithuania

100% 100% 100% 100% 100% 100%

100% 100% 100% 100% 60% 100%

Investments into indirectly controlled subsidiaries (through UAB Linas Agro Konsultacijos)
K KUPIKIO GRDAI Birai district Medeiki B akiai district Luki B Panevys district Auktadvario B Sidabravo B Uups B UAB Edfermus 2 Lithuania Lithuania Lithuania Lithuania Lithuania Lithuania Lithuania 95.71% 98.39% 98.69% 96.03% 66.22% 100% 100% 92.88% 98.36% 98.37% 65.35% 66.22% 70% Preparation and warehousing of grains for trade Growing and sale of crops Mixed agricultural activities Mixed agricultural activities Mixed agricultural activities Growing and sale of crops Growing and sale of crops

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

3. GROUP STRUCTURE AND CHANGES IN THE GROUP (contd)


Changes in the Group during the year ended 30 June 2011 On 1 July 2010 the Company acquired additional 50% shares of PC-JS UKRAGRO NPK for EUR 3,694 thousand (LTL 12,757 thousand equivalent) from UAB Arvi ir Ko. After the share acquisition the Group directly controlled 63.38% of the investee. The mentioned company is consolidated to the Group from 1 July 2010. At the acquisition date the fair value was higher than the carrying value of the net assets by LTL 9,029 thousand representing the differences on non-current assets. Differences between the purchase consideration and fair values of the acquired assets, liabilities and contingent liabilities at the acquisition date were the following: Acquisition date Non-current assets Inventories Prepayments and other current assets Cash and cash equivalents Total assets Deferred tax liability Interest bearing financial liabilities Trade payables Other current liabilities Total liabilities Total identifiable net assets at fair value Attributable to non-controlling interests Attributable to the equity holders of the parent Acquisition date fair value of initially held equity interest Cost Group (loss) on remeasuring to fair value the initially held equity interest Consideration transferred Fair value of initially held equity interest Total fair value of investment Gain from a bargain purchase Group (loss) on remeasuring to fair value the initially held equity interest (Loss) recognized on acquisition of subsidiary, recognised under Other (expenses) Purchase consideration* Less: cash acquired Total purchase consideration, net of cash acquired Revenue for the year ended 30 June 2011 Profit for the year ended 30 June 2011 1 July 2010 16,442 46,735 27,676 7,407 98,260 (3,090) (54,445) (8,417) (4,488) (70,440) 27,820 10,188 17,632 3,414 (5,545) (2,131) 12,757 3,414 16,171 1,461 (2,131) (670) 12,757 7,407 5,350 356,027 11,786

*As at 30 June 2010 the Company had a payment amounting to LTL 12,757 thousand made for the acquired additional 50% shares of PJ-SC UKRAGRO NPK.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

3. GROUP STRUCTURE AND CHANGES IN THE GROUP (contd)


The Group elected to measure the non-controlling interest in the acquiree at the proportionate share of the value of the net identifiable assets acquired. The acquisition resulted in LTL 1,461 thousand gain. The entity is not listed and no active market for fair value estimation exists. The sales price of the shares was determined by the previous equity interest holders. The gain from transaction resulted due to the fact that the sales price of the business was determined based on the historic EBITDA, which was relatively low due to the economic slowdown in the year, preceding to the acquisition. On 27 July 2010 Birai district Medeiki B has acquired additional 36.36% shares of K KUPIKIO GRDAI for LTL 920 thousand. On 18 October 2010 AB Linas Agro has acquired additional 18.18% shares of K KUPIKIO GRDAI for LTL 460 thousand. After the acquisition the effective share of K KUPIKIO GRDAI owned by the Group increased to from 37.24% to 92.88%. The difference of LTL 303 thousand between the consideration transferred and the carrying value of the interest acquired has been recognised within equity due to the below mentioned reasons. On 1 July 2008 the Group companies signed a shareholders agreement with the members of K KUPIKIO GRDAI. The total shareholding of the members that entered into the agreement is 63.63%. According to the clauses of the agreement AB Linas Agro obtained control over K KUPIKIO GRDAIs operations and financial decisions and as a result of the agreement of the other shareholders to transfer their rights to appoint the board of directors. AB Linas Agro was able to appoint the chairman and the majority of the board members of K Kupikio Grdai and, therefore, the mentioned company is consolidated to the Group from 1 July 2008. After the above described acquisition the shareholder agreement was terminated (as at 7 October 2010), however, the control remained within the Group and investment remained consolidated. As at 30 December 2010 and 10 January 2011 the Company sold 2.34% and 3% of PJ-SC UKRAGRO NPK shares for LTL 477 thousand and LTL 612 thousand, respectively, to the management of PJ-SC UKRAGRO NPK. For the Group consolidation purposes the difference of LTL 577 thousand between the considerations received and the carrying value of the interest disposed has been recognised within equity. In addition, AB Linas Agro Group entered to the Shareholders agreement with the non-controlling shareholders of its subsidiary. According to the agreement AB Linas Agro Group has an obligation to acquire the shares from the non-controlling shareholders, if put option is exercised. The Group has accounted the financial liability amounting to LTL 1,953 thousand under other non-current liabilities as at 30 June 2011 in relation to this and accounted for the difference of LTL 109 thousand between the liability and the derecognised non-controlling interest in equity. On 6 April 2011 UAB Linas Agro Konsultacijos together with other shareholders established new subsidiary Uups B. The total share capital of the company is LTL 10 thousand. The effective share of the stock held by the Group is 70%. During the year ended 30 June 2011 the Group acquired 4.44% of akiai district Luki B share capital for LTL 139 thousand, 10.32% of Sidabravo B share capital for LTL 53 thousand. All the shares were acquired from the non-controlling shareholders. UAB Linas Agro Konsultacijos increased Birai district Medeiki B share capital by LTL 920 thousand. Due to the changes in the shareholders of Birai district Medeiki B the effective Group ownership increased from 96.54% to 98.36%. The difference of LTL 828 thousand between the consideration transferred and the carrying value of the interests acquired has been recognised within equity. Changes in the Group during the 6 month period ended 31 December 2011 On 1 July 2011 the Group company Rosenkrantz A/S (registered and operating in Denmark) changed its name to Linas Agro A/S. On 1 July 2011 the Group acquired additional 40% interest of the voting shares of Linas Agro, A/S increasing its ownership interest to 100%. Purchase price EUR 800 thousand (LTL 2,762 thousand equivalent) will be paid by schedule till 15 July 2014. The difference of LTL 7,129 thousand between the consideration transferred and the carrying value of the interest acquired has been recognised within equity. As part of the purchase agreement a contingent consideration has been agreed with the previous owner of Linas Agro A/S. There will be additional cash payment to the previous owner amounting to maximum EUR 400 thousand (undiscounted). Contingent consideration is related to collection of doubtful Linas Agro A/S trade receivables. The due date of contingent consideration arrangement is 1 October 2014.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

3. GROUP STRUCTURE AND CHANGES IN THE GROUP (contd)


The potential undiscounted amount of all future payments that the Group could be required to make under the contingent consideration arrangement is between EUR 0 and EUR 400 thousand. The fair value of the contingent consideration arrangement is EUR 173 thousand as at acquisition date. It was estimated using probability-weighted payout approach. During the 6 month period ended 31 December 2011 the Group acquired 0.32% of akiai district Luki B share capital for LTL 10 thousand, 0.03% Birai district Medeiki B share capital for LTL 1 thousand, 30.68% Panevys district Auktadvario B share capital for LTL 140 thousand, 30% Uups B share capital for LTL 3 thousand, 100% Edfermus 2 UAB share capital for LTL 10 thousand. All the shares were acquired from the non-controlling shareholders. The difference of LTL 2,413 thousand between the consideration transferred and the carrying value of the interest acquired has been recognised within equity.

4. SEGMENT INFORMATION
For management purpose the Group is organized into five operating segments based on their products and services as follows: the grains and oilseeds segment includes trade in wheat, rapeseed, barley and other grains and oilseeds; the feedstuffs segment includes trade in suncake and sunmeal, sugar beat pulp, soymeal, vegetable oil, rapecake and other feedstuffs; the agricultural inputs segment includes sales of fertilizers, seeds, plant protection products and other related products to agricultural produce growers; the farming segment includes growing of grains, rapeseed and others as well as sales of harvest, breeding of livestock and sales of milk and livestock. Milk is sold to local dairy companies, other production is partly used internally, partly sold; the other products and services segment includes sales of biofuel, provision of elevator services and other products and services. Transfer prices between the Group companies are based on normal selling prices in a manner similar to transactions with third parties.
6 month period ended 31 December 2011 Grains and oilseeds Feedstuffs Agricultural inputs Farming Other products and services Not Adjustattributed ments and to any eliminaspecified tions segment (39,483)1) (39,483)1) Total

Revenue From one client UAB MESTILLA Other third parties Intersegment Total revenue Results Operating expenses Segment operating profit (loss) 5,509 3,307 2,259 6,140 8,487 22,073 2,178 (3,550) 1,893 9,385 6,987 (5,668) 27,313 31,687 88,228 273,290 361,518 38 142,242 1,430 143,710 340,014 4,577 344,591 11,842 16,220 28,062 72 12,943 17,255 30,270 88,337 780,331 868,668

6 month period ended 31 December 2010

Grains and oilseeds

Feedstuffs

Agricultural inputs

Farming

Other products and services

Not Adjustattributed ments and to any eliminaspecified tions segment 3,604 (4,566) (34,155)1) (34,155)1) -

Total

Revenue From one client UAB MESTILLA Other third parties Intersegment Total revenue Results Operating expenses Segment operating profit (loss) 4,773 (8,390) 3,010 4,177 5,752 17,230 1,811 1,763 1,784 7,147 20,734 17,361 11,860 299,666 419,526 13 123,515 875 124,403 231,815 4,812 236,627 11,122 13,630 24,752 125 10,019 14,838 24,982 119,998 676,137 796,135

1) Intersegment revenue is eliminated on consolidation.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

4. SEGMENT INFORMATION (contd)

Below is the information relating to the geographical segments of the Group:

Revenue from external customers Lithuania Europe (except for Scandinavian countries, CIS and Lithuania) Scandinavian countries Africa Asia CIS

6 month period ended 31 December 31 December 2011 2010 212,781 144,430 88,763 42,520 96,423 283,751 868,668 241,531 162,681 70,947 46,755 77,664 196,557 796,135

The revenue information above is based on the location of the customer. As of 31 December 2011 123,561 22,807 152 185 146,705 As of 30 June 2011 113,730 18,444 207 205 132,586

Non-current assets Lithuania Ukraine Denmark Latvia

Non-current assets for this purpose consist of property, plant and equipment, investment property and intangible assets.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

5. INTANGIBLE ASSETS

Software

Other intangible assets

Total

Cost: Balance as of 30 June 2010 Additions Acquisition of subsidiaries Write-offs Exchange differences Balance as of 30 June 2011 Additions Write-offs Exchange differences Balance as of 31 December 2011 Accumulated amortization: Balance as of 30 June 2011 Charge for the year Write-offs Exchange differences Balance as of 31 December 2011 Net book value as of 31 December 2011 Net book value as of 30 June 2011 Net book value as of 30 June 2010 1,179 47 1,226 124 5 2 131 1,303 52 2 1,357 1,343 170 57 (50) (8) 1,512 312 2 1,826 201 17 (60) (1) 157 157 1,544 187 57 (110) (9) 1,669 312 2 1,983

599 333 156

26 33 38

625 366 194

The Group has no internally generated intangible assets. Amortization expenses of intangible assets are included within operating expenses in the income statement.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

6. PROPERTY, PLANT AND EQUIPMENT

Land Buildings and Machinery structures and equipment

Vehicles

Other Construction property, in progress plant and and equipment prepayments

Total

Cost: Balance as of 30 June 2010 Additions Acquisition of subsidiaries Disposals and write-offs Transfers to/from investment property Reclassifications Exchange differences Balance as of 30 June 2011 Additions Acquisition of subsidiaries Disposals and write-offs Transfers to/from investment property Reclassifications Exchange differences Balance as of 31 December 2011 Accumulated depreciation: Balance as of 30 June 2010 Charge for the year Disposals and write-offs Exchange differences Balance as of 30 June 2011 Charge for the year Disposals and write-offs Reclassifications Exchange differences Balance as of 31 December 2011 Impairment losses: Balance as of 30 June 2010 (Reversal) charge for the year Balance as of 30 June 2011 (Reversal) charge for the year Balance as of 31 December 2011 Net book value as of 31 December 2011 Net book value as of 30 June 2011 Net book value as of 30 June 2010

6,381 190 249 (13) 156 (40) 6,923 2,043 194 164 23 9,347

79,102 3,291 13,221 (420) 2,797 (2,006) 95,985 3,505 (6) 14,028 1,912 115,424

46,948 5,748 671 (370) (299) (97) 52,601 6,032 (60) 4,636 394 63,603

5,561 1,252 874 (527) 26 (137) 7,049 852 (100) 131 7,932

9,140 666 1,035 (518) (168) 10,155 321 (8) 208 130 10,806

2,388 15,394 335 (205) (2,524) (141) 15,247 4,804 (18,872) (271) 908

149,520 26,541 16,385 (2,053) 156 (2,589) 187,960 17,557 194 (174) 164 2,319 208,020

19,068 5,355 (182) (39) 24,202 2,925 (6) 101 27,222

25,915 4,238 (249) (21) 29,883 2,374 (60) (459) 56 31,794

3,120 914 (293) (11) 3,730 447 (97) 26 4,107

5,594 1,235 (389) (24) 6,416 480 (7) 459 36 7,384

53,697 11,742 (1,113) (95) 64,231 6,226 (170) 219 70,506

206 (156) 50 50 9,297 6,873 6,175

266 182 448 448 87,755 71,335 59,768

19 19 19 31,790 22,699 21,014

4 (1) 3 3 3,822 3,316 2,437

2 (1) 1 1 3,421 3,738 3,544

908 15,247 2,388

497 24 521 521 136,993 123,208 95,326

15

AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

7. INVESTMENT PROPERTY

Investment property of the Group consists of land and buildings leased out under the operating lease which generates lease income. Land Cost: Balance as of 30 June 2010 Additions Transfers from property, plant and equipment Balance as of 30 June 2011 Additions Disposals Transfers to/from property, plant and equipment Balance as of 31 December 2011 Accumulated depreciation: Balance as of 30 June 2010 Charge for the year Balance as of 30 June 2011 Charge for the year Transfers to/from property, plant and equipment Balance as of 31 December 2011 Impairment losses: Balance as of 30 June 2010 Charge for the year Balance as of 30 June 2011 Balance as of 31 December 2011 Net book value as of 31 December 2011 Net book value as of 30 June 2011 Net book value as of 30 June 2010 591 (349) 242 242 7,662 7,539 7,083 1,389 (261) 1,128 1,128 1,425 1,473 1,315 1,980 (610) 1,370 1,370 9,087 9,012 8,398 593 103 696 48 744 593 103 696 48 744 7,674 263 (156) 7,781 351 (64) (164) 7,904 3,297 3,297 3,297 10,971 263 (156) 11,078 351 (64) (164) 11,201 Buildings Total

The Groups management considers that the difference between the carrying value and fair value of investment property is not significant. Fair value has been determined based on valuations performed by independent valuators at near reporting date using the comparable prices method.

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

8. INVESTMENTS INTO ASSOCIATES AND JOINT VENTURES


As of 31 December and as of 30 June 2011 the Group had investments into the following associates and joint ventures: Effective share held by the Group Place of registration Associates UAB Jungtin Ekspedicija Joint ventures UAB Dotnuvos Projektai Companies controlled by UAB Dotnuvos Projektai UAB Dotnuvos Technika SIA DOTNUVOS PROJEKTAI AS Dotnuvos Projektai UAB Dotnuvos Agroservisas Lithuania Latvia Estonia Lithuania 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 49.98% Dormant Sale of seeds, agricultural machinery Sale of seeds, agricultural machinery Agricultural equipment maintenance and related services As of 31 December 2011 45.05% 50.00% As of 30 June 2011 45.05% 50.00% Main activities

Lithuania Lithuania

Expedition and ships agency services Sale of seeds, agricultural machinery

Information on associates and joint ventures of the Group as of 31 December 2011 was as follows (full amounts of revenue and profit and full amounts of statement of financial position):
Investment at Profit (loss) for equity the reporting method period Sales revenue Non-current assets Current assets Non-current liabilities Current liabilities

Investments into associates UAB Jungtin Ekspedicija Investments into joint ventures UAB Dotnuvos Projektai (consolidated)

457 457

244

2,893

130

2,050

1,167

26,886 26,886

2,131

87,334

37,176

86,653

4,631

65,108

Information on associates and joint ventures of the Group as of 30 June 2011 was as follows (full amounts of revenue and profit and full amounts of statement of financial position):
Investment at Profit (loss) for equity the reporting method period Sales revenue Non-current assets Current assets Non-current liabilities Current liabilities

Investments into associates UAB Jungtin Ekspedicija Investments into joint ventures UAB Kustodija UAB Dotnuvos Projektai (consolidated) Classified as held for sale

347 347 1,802 25,821 27,623 (1,802) 25,821

139

4,315

166

1,112

507

(83) 9,823

38,787 176,194

689 35,689

30,220 133,218

102 5,413

27,204 111,851

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

9. OTHER INVESTMENTS
Other investments of the Group consist of: Share held As of 31 As of 30 by the December June 2011 Group 2011 Panevys district riki B Other investments 24.97% 173 131 304 173 192 365

The investment into Panevys district riki B is not classified as an associate and therefore not accounted for using the equity method because the Group does not have voting rights in the company and does not have the ability to exercise significant influence.

10. BORROWINGS
As of 31 December 2011 Non-current borrowings Bank borrowings secured by the Group assets Other non-current borrowings Current borrowings Current portion of non-current bank borrowings Current portion of other non-current borrowings (Note 16) Current bank borrowings secured by the Group assets Factoring with recourse liability Other current borrowings 13,128 2,042 134,711 13,748 1,650 165,279 194,689 12,814 2,000 160,109 18,894 1,881 195,698 223,993 28,343 1,067 29,410 As of 30 June 2011 27,228 1,067 28,295

Interest payable is normally settled monthly throughout the financial year. Accrued interest on bonds issued is settled annually.

11. COST OF SALES


2011/2012 6 month 755,872 44,622 7,185 3,977 2,296 110 411 814,473 2010/2011 6 month 689,828 50,047 7,557 3,520 1,849 (2,272) 3,402 753,931

Cost of inventories recognized as an expense Logistics expenses Wages and salaries and social security Depreciation Utilities expenses (Income) expense from change in fair value of biological assets Other

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

12. OPERATING EXPENSES


2011/2012 6 month Wages and salaries and social security Consulting expenses Depreciation and amortization Other 17,382 879 773 8,279 27,313 2010/2011 6 month 12,961 545 870 6,358 20,734

13. OTHER INCOME (EXPENSES)


2011/2012 2010/2011 6 month 6 month Other income Currency exchange gain Rental income from investment property and property, plant and equipment Gain from disposal of investment property and property, plant and equipment Gain from disposal of joint venture Other income Other (expenses) Direct operating expenses arising on rental and non-rental earning investment properties Loss from disposal of property, plant and equipment Currency exchange loss Loss recognized on acquisition of subsidiary (Note 3) Loss recognized on disposal of subsidiary (Note 3) Other expenses (193) (2) (52) (247) (118) (9) (3,577) (670) (253) (101) (4,728) 2,110 423 88 1,060 1,371 5,052 461 98 60 619

14. INCOME (EXPENSES) FROM FINANCING ACTIVITIES


2011/2012 2010/2011 6 month 6 month Income from financing activities Interest income Income from overdue payments (Expenses) from financing activities Interest expenses 720 28 748 (5,271) (5,271) 842 252 1,094 (4,217) (4,217)

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

15. COMMITMENTS AND CONTINGENCIES


As of 31 December 2011 the Group is committed to purchase property, plant and equipment for the total amount of LTL 395 thousand (LTL 9,960 thousand as of 30 June 2011). Additional investments are required for cattle farms located in Panevys district Auktadvario B and Sidabravo B due to stiffening environmental regulation in Lithuania. Incompliance with such regulations may result in significant fines. Total estimated investment value for modernization till compliance level with the environmental regulations set by the Republic of Lithuania amounts to LTL 1,300 thousand (Panevys district Auktadvario B LTL 650 thousand and Sidabravo B LTL 650 thousand). A few Group companies (akiai district Luki B and Sidabravo B) received grants from the European Union and National Paying Agency mostly for acquisition of agricultural heavy duty equipment. akiai district Luki B is committed not to discontinue operations related to agriculture up to 2015, Sidabravo B up to 2013. UAB Linas Agro Grd Centras KB received grant from the European Union and National Paying Agency for grain handling and storage facility upgrade. UAB Linas Agro Grd Centras KB is committed not to discontinue operations related to preparation and warehousing of grains for trade agriculture up to 2015. In case of non-compliance with the requirements the Group companies will have to return funds received to the state of Lithuania amounting to LTL 4,157 thousand as of 31 December 2011 (LTL 2,854 thousand as of 30 June 2011).

16. RELATED PARTIES TRANSACTIONS


The parties are considered related when one party has the possibility to control the other or have significant influence over the other party in making financial and operating decisions. The related parties of the Company and Group for the years ended 31 December and 30 June 2011 were as follows: Members of the board of the Company: Darius Zubas (chairman of the board, ultimate controlling shareholder); Vytautas idlauskas; Dainius Pilkauskas; Arnas Zubas; Andrius Pranckeviius; Arnas Jarmolaviius; Tomas Tumnas (member of the board from 1 October 2008). Subsidiaries: List provided in Note3; Joint ventures (Note 8): UAB Dotnuvos Projektai; B Dotnuvos agroservisas (till 28 December 2011, reorganized); UAB Dotnuvos Technika; SIA DOTNUVOS PROJEKTAI (related from 26 April 2010); AS Dotnuvos projektai (related from 11 November 2010); UAB Kustodija (till 19 October 2011). Associates (Note 8): UAB Jungtin Ekspedicija. Akola ApS group companies: Akola ApS (Denmark) (controlling shareholder); UAB MESTILLA (same ultimate controlling shareholders); OOO Ukrkalyj (Ukraine), in liquidation status (same ultimate controlling shareholders); PJ-SC UKRAGRO NPK (Ukraine) (same ultimate controlling shareholders, subsidiary since 1 July 2010); UAB Baltic Fund Investments (Tomas Tumnas is a director of this company).

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AB LINAS AGRO GROUP, COMPANY CODE 148030011, SMLYNS ST. 2C, PANEVYS, LITHUANIA CONSOLIDATED FINANCIAL STATEMENTS FOR THE 6 MONTH PERIOD YEAR 2011/2012 (all amounts are in LTL thousand unless otherwise stated)

16. RELATED PARTIES TRANSACTIONS (contd)


The Groups transactions with related parties in 6 month period ended 31 December, 2011 were as follows: Receivables Trade Current receivables loans receivable 23 72 6,127 6,223 2,087 2,087

Purchases

Sales

Non-current loans receivable 1,359 1,359

Payables

Current loans received 679 691 1,370

Members of the board Joint ventures Associates Akola ApS group companies

23 6,117 4,749 7,580 18,469

826 72 94,671 95,569

2,498 550 201 3,249

* Loans borrowed from related parties are accounted for under current portion of non-current borrowings in the statements of financial position (Note 10). As of 31 December and as of 30 June 2011 annual interest rate of the Groups loans borrowed and non-current loans receivable from related parties are fixed and equal to 7% and 8%, respectively. Current loans receivable from related parties bear 1m EURIBOR + 4.1% margin annual interest rate. Transactions with related parties include sales and purchases of goods and services, sales and purchases of property, plant and equipment as well as financing transactions in the ordinary course of business. There were no guarantees or pledges related to the Groups payables to or receivables from related parties. Receivables and payables from / to related parties will be settled in cash or offset with the payables / receivables from / to respective related parties. Terms and conditions of the financial assets and liabilities: Receivables from related parties are non-interest bearing and are normally settled on 30-day terms. Payables to related parties are non-interest bearing and are normally settled on 30-90-day terms. Interest payable is normally settled at the end of the loan term. The Groups receivables from related parties were not past due as of 31 December and 30 June 2011.

17. SUBSEQUENT EVENTS


As of 6 February 2012 Company sold 58.04% of shares of the PJ-SC UKRAGRO NPK for LTL 90.505 thousand.

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