ADDITIONAL INFORMATION 01.07.2014 --- 30.09.2014 QUARTERLY REPORT · Functional currency and presentation currency ... presentation currency at the mid-exchange rate of the National

Additional information for the Corporate Group SYNTHOS S.A.

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ADDITIONAL INFORMATION 01.07.2014 --- 30.09.2014 QUARTERLY REPORT


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Additional notes and explanations for

the SYNTHOS S.A. Group

Quarterly report for the period

from 1 July 2014 to 30 September 2014

THE MANAGEMENT BOARD OF SYNTHOS S.A.:

- PRESIDENT OF THE BOARD .................................................

- VICE-PRESIDENT OF THE BOARD .................................................

- BOARD MEMBER .................................................

- BOARD MEMBER .................................................

- BOARD MEMBER .................................................


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Accounting policies adopted in the preparation of the report.

In these condensed consolidated financial statements the Synthos S.A. Group applied the International Financial Reporting Standards (IFRS) which were also binding in the comparative period.

In accordance with the resolution of the Issuer’s General Shareholders’ Meeting of 30/05/2005, the separate financial statements have been prepared under IAS.

Functional currency and presentation currency

The Group has two functional currencies due to the fact that it operates on two markets:

a. in Czech companies, the Czech koruna is the functional currency;

b. in Polish entities, the Polish zloty is the functional currency.

The presentation currency in which these financial statements are prepared is the Polish zloty. Assets and liabilities & equity measured in the functional currencies were translated into the presentation currency at the mid-exchange rate of the National Bank of Poland as at the balance sheet date.

Transactions expressed in foreign currencies are recognized in the functional currency as at the transaction date using the mid-exchange rate of the NBP or the CNB (the Czech National Bank) as at the transaction date.

Assets and liabilities expressed in foreign currencies are translated as at the balance sheet date at the mid-exchange rate of a given functional currency as at that date. Foreign exchange gains and losses resulting from the settlement of transactions in foreign currencies and valuation of monetary assets and liabilities expressed in foreign currencies as at the balance sheet date are recognized in profit or loss. Non-monetary assets and liabilities measured at historical cost in a foreign currency are translated at the mid-exchange rate of the functional currency as at the transaction date.

Financial data in CZK has been translated as follows:

a. individual assets and liabilities & equity – at the exchange rate as at 30 September 2014 – PLN/CZK 0.1520.

Significant changes in the estimates made by the Synthos S.A. Group in the 3rd quarter of 2014

The Group did not make any significant changes to its estimates in the reporting period.


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I. BRIEF DESCRIPTION OF SIGNIFICANT ACHIEVEMENTS OR FAILURES OF THE SYNTHOS

S.A. GROUP IN THE 3RD QUARTER OF 2014 AND A LIST OF MAJOR EVENTS

RELATING TO SUCH ACHIEVEMENTS OR FAILURES.

Building the AGRO segment

For many years, the Synthos S.A. Group has been consistently following a strategy of consolidating its market position and creating a modern, highly profitable product portfolio. In pursuing these goals, Synthos S.A. has decided to develop a new activity, i.e. the manufacture of plant protection products. Its primary objective is to gain the largest possible share in the global market for plant protection products as soon as possible. Synthos S.A. will achieve these aims through:

a. acquisitions;

b. registrations and sale of plant protection products in Poland and abroad;

c. building its own R&D centre for plant protection products;

d. conducting research and devising new formulas for plant protection products;

e. building an installation for the synthesis of active substances;

f. building installations for formulating and packaging plant protection products;

g. building distribution structures in selected countries.

In April 2014, Synthos acquired 68% of the shares in the share capital of Zakład Doświadczalny “Organika” Spółka z ograniczoną odpowiedzialnością (a research and innovation centre), with its registered office in Nowa Sarzyna. In its product portfolio, the Company has a plant protection product called ORKAN 350 SL used for killing weeds in apple tree orchards. The product’s effectiveness is based on the combination of two active substances, namely glyphosate and MCPA.

Zakład Doświadczalny “Organika” Sp. z o.o. has production lines which make it possible to manufacture plant protection products and put them in trade packaging – bottles and canisters. The Company also offers formulation services for other companies.

The 3rd quarter of 2014 saw the finalization of the takeover of the registration of plant protection products and biocidal products from Zakłady Chemiczne Organika-Azot S.A. in Jaworzno. This is an enterprise with a long tradition, which has products intended both for the domestic market and for foreign markets in its offer.

The main area of Organika-Azot’s activities is the production of fungicides for protecting orchards and vegetables against fungal infections. The main products are fungicides which carry the trade names of Miedzian, Kaptan and Funaben as well as well-known biocidal products such as Muchozol (a fly repellent), Mrówkozol (an ant repellent), and Insektozol (an insect repellent).

The purchase of registrations for plant protection products and biocidal products from Organika-Azot as well as the production and formulation services offered by ZDO allow the Synthos Group to enter the market quickly with products bearing the Synthos AGRO mark. The Synthos Group’s current entry into the market with new products, namely plant


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protection products, will allow it to prepare customers for a much broader and greater-scale product portfolio which will be offered after the completion of the construction of its own complex of installations for the production of active substances and plant protection products.

Acquisition in the dispersion and adhesives segments

On 18 July 2014, an agreement was concluded with SPV Boryszew 3 Spółka z .o.o., with its registered office in Warsaw (a subsidiary of Boryszew S.A.) for the sale of 20,550 (in words: twenty thousand five hundred and fifty) shares representing 100% of the share capital of Oristano Investment Spółka z o.o. for PLN 40,000,000.00 (in words: forty million). The ownership of the shares was transferred to Synthos SA on 12 August 2014.

In October 2014, Oristano Investment Sp. z o.o., which is engaged in the production of vinyl dispersions and adhesives, was incorporated into Synthos S.A. (the part thereof associated with trading activities, i.e. purchases, sales) and into Synthos Dwory 7 Sp. z o.o. spółka jawna (the production part thereof).

The acquisition is yet another step in building the position of the leading supplier of chemical products and market leader offering high quality solutions in the dispersion and adhesives segments, taken mainly to meet the needs of end customers and users.

The Synthos Group has considerably increased its share in the Polish market for vinyl dispersions, wood adhesives, and adhesives for the papermaking industry.

Synthos S.A.’s long-term strategy provides for building the market value of the dispersion and adhesives business gradually. It is aimed at using the production potential of the Sochaczew Plant to the maximum and, in the longer term, developing this entity.

Building an installation for the production of SSBR rubber

In the 3rd quarter of 2014, the works associated with building an installation for the production of modern S-SBR rubber were continued at the Oświęcim plant. In the said period, a shop floor was being assembled, amongst others, which will house four lines for the expansion drying of rubber. The first assembly of the facilities was commenced at the beginning of October. Foundations for future storage facilities were also prepared. Moreover, the assembly of butadiene tanks and the assembly works consisting of developing a network of pipelines servicing the butadiene tanks and pump house were completed.

In June 2012, Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna signed a licence agreement with The Goodyear Tire & Rubber Company. Under the licence agreement, Goodyear will make available the S-SBR advanced rubber production technology (purchase of a licence and know-how). The capital expenditure project will lead to extending the Synthos S.A. Group’s production capacity in the area of modern S-SBR nominally by ca. 90,000 tonnes a year. The launch of a production unit operating on the basis of the technology acquired will take place in 2015. The recipients of S-SBR will be the leading tyre manufacturers from all parts of the world. The installation concerned can also be used for the production of polybutadiene rubber.


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S-SBR rubber, which is produced on the basis of the licence, is used in the manufacture of modern tyres, both summer and winter tyres, with enhanced properties in the area of abrasion resistance, rolling resistance, and adhesion to wet surface (“performance tires”). These properties decrease fuel consumption and improve driving safety and comfort. The market for such tyres will grow faster than the market for traditional tyres, which is also associated with energy saving and CO2 emission reduction policies followed by developed countries (including the EU, Japan, USA, and South Korea), which are reflected in the laws concerning tyre labelling.

Capital expenditure projects carried out in the area of power engineering

In the 3rd quarter of 2014, preparatory works were under way in Synthos Dwory 7 sp. z o.o. spółka jawna in Oświęcim, for the construction of a new fluidized bed boiler. The boiler is to be commissioned for use at the end of 2015. The total cost of this task will amount to ca. PLN 160 million.

Obtaining permits to operate in the Kraków Special Economic Zone

On 1 July 2014, a meeting was held at the Marshal’s Office of the Lesser Poland Voivodeship, during which three new permits to operate in the Kraków Special Economic Zone were awarded. The permits will make it possible to carry out three new capital expenditure projects planned by the Synthos Group:

a. to build an installation for the production of butadiene-styrene solvent rubber (under the periodic method);

b. to build a plant protection products facility;

c. to build an installation for the production of innovative polystyrene for foam formation to be used for manufacturing improved insulation materials for the construction industry.

The projects will be carried out in Oświęcim, on the premises of Synthos Dwory 7 sp. z o.o. spółka jawna.

II. DESCRIPTION OF FACTORS AND EVENTS, PARTICULARLY THOSE OF AN UNUSUAL

NATURE, WHICH SIGNIFICANTLY AFFECTED THE FINANCIAL RESULTS OF THE

SYNTHOS S.A. GROUP.

In the Company’s opinion, the 3rd quarter of 2014 was a period full of challenges. Apart from the improvement in the level of economic activity in the automotive sector in Europe and the USA, negative market factors affecting the results of the Synthos S.A. Group’s operations could be felt. In particular, the following factors affected its results of operations:

a. Gradual improvement in the situation in the European automotive industry. In September 2014, sales of cars in the European Union increased for the thirteenth time in a row. The number of new car registrations increased by 6.4% on an annual basis to 1,235,501 (source: European Automobile Manufacturers’ Association (ACEA)). In the period from January to September 2014, the sales were 6.1% higher than a year


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ago and totalled 9,572,259 cars, with the largest increases being recorded in Spain and Great Britain.

b. Stable (compared with the previous year) demand on the markets for replacement tyres in Europe (except for agricultural tyres). In the case of cars, the increase in the 3rd quarter of 2014 amounted to 1% (source: European Tyre & Rubber Manufacturers’ Association (ETRMA)). In the case of agricultural tyres, in the reporting period a 9% drop was recorded compared with the previous year.

c. China’s growth rate lower than expected. This factor reduced the possibilities of generating profits for European manufacturers of synthetic rubber, including the Synthos S.A. Group companies.

d. Low rate of growth in the value of production sold in the construction industry. IBnGR has estimated it at 1.3%. This is the lowest quarterly growth rate recorded in this sector in 2014. Although the deterioration of the situation in the construction sector should be treated as temporary, it is worth noting the depth of this deterioration (source: The condition of and a forecast for the level of economic activity, IBnGR, October 2014). This situation affected the results of the segment of dispersions and styrene insulation plastics (mainly EPS) manufactured by the Synthos S.A. Group.

e. In the 3rd quarter of 2014, the prices of the basic types of polystyrene, i.e. GPPS and HIPS polystyrene, were still under the influence of high styrene prices. Thanks to this situation, satisfactory margins were earned.

f. Low butadiene prices which ultimately had an adverse effect on the margins earned on synthetic rubber and, consequently, on the financial results of the Synthos S.A. Group for the 3rd quarter of 2014.

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Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2009 2010 2011 2012 2013 2014

Synthetic rubbers sales volume dynamics (2008 = 100)

Q LTM Q1 2008 = 100 2008=100


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III. EXPLANATIONS RELATING TO THE SEASONAL OR CYCLICAL NATURE OF THE

OPERATIONS OF THE SYNTHOS S.A. GROUP IN THE 3RD QUARTER OF 2014.

The procurement of strategic raw materials does not show any seasonal or cyclical nature of deliveries. All deliveries of strategic raw materials are made under multi-year or annual agreements, in quantities necessary to ensure the continuity of production.

IV. INFORMATION ON THE ISSUE, REDEMPTION AND REPAYMENT OF DEBT AND EQUITY

SECURITIES.

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2009 2010 2011 2012 2013 2014

Styrenics sales volume dynamics (2008 = 100)

Q LTM

Q1 2008 = 100 2008=100

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2009 2010 2011 2012 2013 2014

Dispersions and adhesives sales volume dynamics (2008 = 100)

Q LTM

Q1 2008 = 100 2008=100


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On 30 September 2014, Synthos Finance AB, the Issuer’s subsidiary, issued senior notes with a value of EUR 350 million (the Bonds). The issued bonds bear a fixed interest rate of 4% p.a. and will mature on 30 September 2021. Interest will be payable on a semi-annual basis (on 30 March and 30 September)

The bonds are unsecured and are guaranteed by Synthos S.A. and its subsidiaries: Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna, Synthos Kralupy a.s., Tamero Invest s.r.o., and Synthos PBR s.r.o. The funds raised from the issue of the bonds were earmarked for paying off the Group’s current debt of EUR 258.6 million and for the general corporate purposes of Synthos S.A. and the other guarantors.

At the same time, in order to transfer the funds from the issue of the Bonds, on 30 September 2014 the Issuer’s Management Board passed a resolution on the issue of intra-Group bonds which were taken up by Synthos Finance AB and which constitute unsecured registered bonds issued pursuant to the Bonds Act of 29 June 1995. The nominal value of the intra-Group bonds amounts to EUR 350,000,000 and is the same as the nominal value of the Bonds. The total issue price of the intra-Group bonds is EUR 344,001,000. The funds raised from the issue of the intra-Group bonds will be used to pay off the Group’s current debt, cover the costs of the issue of the Bonds and for the general corporate purposes of the Group, including the Issuer and other Guarantors. The terms of redemption and the terms of payment of interest on the intra-Group bonds are the same as those for the Bonds. The total value of liabilities incurred by Synthos S.A. as at the last day of the quarter preceding the issue of the intra-Group bonds (i.e. as at 30 June 2014) amounts to PLN 360.8 million. The Issuer’s prospects for the period up until the redemption of all the intra-Group bonds are stable.

V. INFORMATION ON DIVIDENDS PAID (OR DECLARED), IN THE TOTAL AMOUNT AND

PER SHARE, FOR ORDINARY AND PREFERENCE SHARES.

In the reporting period, no dividend was paid.

VI. EVENTS WHICH OCCURRED AFTER THE PREPARATION OF THESE QUARTERLY

FINANCIAL STATEMENTS AND WERE NOT RECOGNIZED IN THESE FINANCIAL

STATEMENTS, WHICH COULD HAVE A SIGNIFICANT EFFECT ON THE FUTURE RESULTS

OF THE SYNTHOS S.A. GROUP

There were none.

VII. CHANGES IN CONTINGENT LIABILITIES OR ASSETS WHICH OCCURRED AFTER THE END

OF THE PREVIOUS FINANCIAL YEAR.

As at the balance sheet date of 30 September 2014, the Group did not grant any contingent liabilities outside the Group.


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VIII. SELECTED FINANCIAL DATA, INCLUDING BASIC ITEMS OF THE CONDENSED

FINANCIAL STATEMENTS (ALSO TRANSLATED INTO EUR) PRESENTING DATA

CUMULATIVELY FOR ALL FULL QUARTERS OF THE CURRENT AND PRECEDING

FINANCIAL YEARS.

SELECTED FINANCIAL DATA in PLN’000 in EUR’000

period from 2014-01-01

to 2014-09-30

period

from 2013-01-01 to 2013-09-30

period

from 2014-01-01 to 2014-09-30

period

from 2013-01-01 to 2013-09-30

data relating to the condensed consolidated financial statements

I. Net sales of finished goods, goods for resale and materials 3 575 380 3 900 522 855 293 923 616

II. Operating profit/(loss) 391 956 348 356 93 763 82 488

III. Profit/(loss) before tax 370 822 343 653 88 707 81 375

IV. Net profit/(loss) attributable to the shareholders of the Parent Company 290 858 306 010 69 578 72 461

V. Net cash from operating activities 421 390 502 393 100 804 118 963

VI. Net cash from investing activities ( 225 745) ( 218 079) ( 54 002) ( 51 640)

VII. Net cash from financing activities 9 433 ( 536 636) 2 257 ( 127 072) VIII. Net increase/(decrease) in cash and cash equivalents 205 078 ( 252 322) 49 058 ( 59 748)

Balance sheet data from the consolidated statement of financial position (comparative period 31.12.2013)

IX. Total assets 4 469 559 4 023 106 1 070 425 929 295

X. Total liabilities 2 327 578 1 731 845 557 437 400 038

XI. Long-term liabilities 1 672 445 576 220 400 538 133 101

XII. Short-term liabilities 655 133 1 155 625 156 899 266 937

XIII. Equity 2 141 981 2 291 261 512 988 529 257

XIV. Share capital 39 698 39 698 9 507 9 170

data relating to the separate financial statements

XV. Net sales of finished goods, goods for resale and materials 79 040 72 030 18 908 17 056

XVI. Operating profit/(loss) 998 308 481 548 238 813 114 027

XVII. Profit/(loss) before tax 1 000 211 474 277 239 268 112 305

XVIII. Net profit/(loss) 997 460 470 622 238 610 111 440 XIX. Net increase/(decrease) in cash and cash equivalents 254 666 ( 10 571) 60 921 ( 2 503)

Balance sheet data from the separate statement of financial position (comparative period 31.12.2013)

XX. Total assets 2 977 787 875 799 713 157 202 300

XXI. Long-term liabilities 1 456 030 77 534 348 708 17 910

XXII. Short-term liabilities 395 280 263 058 94 667 60 764

XXIII. Equity 1 126 477 535 207 269 783 123 627

XXIV. Share capital 39 698 39 698 9 507 9 170


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IX. DESCRIPTION OF THE ORGANIZATION OF THE SYNTHOS S.A. GROUP WITH

SPECIFICATION OF CONSOLIDATED ENTITIES.

The parent company of the SYNTHOS S.A. Group is SYNTHOS Spółka Akcyjna (hereinafter also: the Issuer). The main activity of the Issuer is the management of the Group. The Issuer’s share capital amounts to PLN 39,697,500 (thirty-nine million six hundred and ninety-seven thousand five hundred zlotys) and comprises:

a. 854,250,000 (eight hundred and fifty-four million two hundred and fifty thousand) A-series ordinary bearer shares with PLN 0.03 (three groszy) par value each, with numbers from A 000.000.001 to A 854.250.000;

b. 469,000,000 (four hundred and sixty-nine million) B-series ordinary bearer shares with PLN 0.03 (three groszy) par value each, with numbers from B 000.000.001 to B 469.000.000.

The Synthos S.A. Group consists of three manufacturing companies: Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna, Synthos Kralupy a.s., and Synthos PBR s.r.o., whose operations comprise mainly the production of rubber and styrene plastics.

In the period from 1 January 2014 to 30 September 2014, the Issuer’s Group comprised the following consolidated subsidiaries:

a. The Synthos S.A. Branch operating under the name of Synthos S.A. (organizačni složka), with its registered office in Kralupy nad Vltavou, the Czech Republic, which commenced operations on the date of its registration in the Czech Commercial Register, i.e. on 22 January 2008.

b. Synthos Dwory 7 sp. z o.o., with its registered office in Oświęcim. The Issuer holds 100% of the share capital and represents 100% of the votes at the General Shareholders’ Meeting of Synthos Dwory 7 sp. z o.o.

c. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna, with its registered office in Oświęcim. The Company was formed as a result of the transformation of Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka komandytowo-akcyjna in accordance with the provisions of Article 551 § 1 and the following ones of the Commercial Companies Code based on the resolution of the Extraordinary General Shareholders’ Meeting of the Company dated 25 November 2013. The transformation was registered with the District Court for Kraków-Śródmieście in Kraków on 12 December 2013.

Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna is the legal successor of Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka komandytowo-akcyjna and is engaged in the production of synthetic rubber and synthetic latex, styrene plastics, vinyl dispersions and acrylic copolymer dispersions, as well as the generation and distribution of electricity, the generation and distribution of heat, and water collection and treatment.


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The Company’s shareholders are: Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością, with its registered office in Oświęcim, in which the Issuer holds 100% of the shares, and Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością Holding spółka komandytowo-akcyjna, with its registered office in Oświęcim (the Issuer’s indirect subsidiary).

The shareholder authorized to sole representation is Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością, a subsidiary wholly-owned by the Issuer.

d. Synthos Kralupy, a.s. with its registered office in Kralupy nad Vltavou, the Czech Republic. This is a chemical company that produces, amongst others, synthetic rubber, styrene plastics, ethylbenzene, and butadiene. The Issuer is the sole shareholder of Synthos Kralupy a.s., representing 100% of its share capital.

e. Synthos PBR s.r.o. with its registered office in Kralupy nad Vltavou, the Czech Republic. The Company is engaged in the production of synthetic rubber based on the licence granted by the Michelin Group. The Issuer holds 100% of the shares in the share capital and votes at the General Shareholders’ Meeting of that Company.

f. Tamero Invest s.r.o., with its registered office in Kralupy nad Vltavou, the Czech Republic. The Company is engaged in the generation and distribution of electricity, the generation and distribution of heat, and water collection and treatment. Synthos Kralupy a.s. holds 100% of the shares in this Company.

g. Synthos Dwory 4 Sp. z o.o., with its registered office in Oświęcim. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna holds 99% of the shares in the share capital and represents 99% of the votes at the General Shareholders’ Meeting of this Company. SYNTHOS S.A. holds 1% of the shares in the share capital and represents 1% of the votes at the General Shareholders’ Meeting of this Company. The Company is engaged, amongst others, in the generation of electricity.

h. Synthos Dwory 5 Sp. z o.o., with its registered office in Oświęcim. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna holds 99% of the shares in the share capital and represents 99% of the votes at the General Shareholders’ Meeting of this Company. SYNTHOS S.A. holds 1% of the shares in the share capital and represents 1% of the votes at the General Shareholders’ Meeting of this Company. The Company is engaged, amongst others, in the generation of electricity.

i. Synthos Dwory 8 Sp. z o.o., with its registered office in Oświęcim. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna 100% of the shares in the share capital and represent 100% of the votes at the General Shareholders’ Meeting of this Company. The Company is engaged, amongst others, in the generation of electricity.

j. Miejsko-Przemysłowa Oczyszczalnia Ścieków Sp. z o.o., with its registered office in Oświęcim. The Company’s activities comprise the collection, treatment and disposal of sewage, treatment of waste, providing sanitary services and related services. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna holds 76.79% of the shares in the share capital and votes at the General Shareholders’ Meeting of this Company. The remaining 23.21% of the shares in the share capital and votes at the General Shareholders’ Meeting of this Company are held by the Oświęcim Municipality.


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k. SYNTHOS Fundusz Inwestycyjny Zamknięty (Closed-end Investment Fund) – entered in the register of investment funds with the reference number 655, managed by FORUM TFI S.A., with its registered office in Kraków. The Issuer holds indirectly all certificates issued by SYNTHOS FIZ. Out of a total of 1 718 certificates, two (A series) are held by the Issuer, and the remaining 1 716 (B series) are held by Red Chilli Limited (a wholly-owned subsidiary of the Issuer).

l. CALGERON INVESTMENT LIMITED, with its registered office in Nicosia, Cyprus. On 15 July 2011, Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna held 100% of the share capital of CALGERON INVETMENT Ltd., which is engaged in investment and equity operations in the Synthos S.A. Group.

m. Red Chilli Ltd., with its registered office in Nicosia, Cyprus. Synthos S.A. holds 100% of the shares in the share capital and represents 100% of the votes at the General Shareholders’ Meeting of this Company, which is engaged in investment and equity operations in the Synthos S.A. Group.

n. Butadien Kralupy a.s., with its registered office in Kralupy nad Vltavou, the Czech Republic. Synthos Kralupy a.s. holds 49% of the shares in the share capital of this Company. Butadien Kralupy a.s. is engaged in the processing of C4 fraction to extract butadiene and raffinate 1. The Company is consolidated under the IFRS 11 regulations.

o. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością Holding spółka komandytowo-akcyjna, with its registered office in Oświęcim, entered in the National Court Register on 26 September 2013 with the reference number KRS 0000478085. The Company’s share capital amounts to PLN 50,000.00.

Synthos Dwory 7 sp. z o.o. (a subsidiary wholly-owned by the Issuer) is the sole general partner of the Company, and at the same time is a holder of 100 B-series registered shares. 49,900 (forty-nine thousand and nine hundred) A-series shares in the Company are held by Synthos Fundusz Inwestycyjny Zamknięty (an indirectly, wholly-owned subsidiary of the Issuer).

p. Zakład Doświadczalny “Organika” Sp. z o.o., with its registered office in Nowa Sarzyna, in which the Issuer holds 68% of the shares in the share capital and votes at the General Shareholders’ Meeting of this Company. ZDO Organika is engaged in the production of pesticides.

q. Synthos Finance AB (publ.) – a Swedish special purpose company, acquired by Synthos S.A. as a non-operating newly established company for the purpose of issuing bonds (the details of the issue are presented in point IV above). The Company’s share capital amounts to EUR 55,005.61 and consists of 4,951 shares with a nominal value of EUR 11.11 each. Synthos S.A. is the sole owner of all shares.

In the reporting period, the Group also included the following non-consolidated companies:

a. Synthos Dwory 2 Sp. z o.o., with its registered office in Oświęcim. The planned operations of this Company comprise laboratory activities. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna holds 100% of the shares in the share


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capital and represents 100% of the votes at the General Shareholders’ Meeting of this Company.

b. Synthos XEPS s.r.o., with its registered office in Kralupy nad Vltavou, the Czech Republic. The Issuer holds 100% of the shares in the share capital and votes at the General Shareholders’ Meeting of this Company. This Company will be used as a special purpose vehicle for planned investment activities relating to new products.

c. Synthos Agro Sp. z o.o. (formerly Synthos Dwory 6 Sp. z o.o.), with its registered office in Oświęcim. Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna holds 99% of the shares in the share capital and represents 99% of the votes at the General Shareholders’ Meeting of this Company. SYNTHOS S.A. holds 1% of the shares in the share capital and represents 1% of the votes at the General Shareholders’ Meeting of this Company. The Company will engage in trading and marketing activities relating to plant protection products.

d. Synthos do Brasil Industria e Comercio de Quimicos Limitada, listed in the National Register of Legal Entities of the Federal Republic of Brazil on 21 November 2013 with the reference number 19.297.642/0001-22. On 11 August 2014, the Company’s share capital was increased and currently amounts to PLN 3,544,400.00 Brazilian reals and consists of 3,544,400,000 shares. Synthos S.A. holds 3,542,400 shares in the share capital. Synthos Dwory 2 Sp. z o.o. holds 2,000 shares in the share capital.

e. Oristano Investment spółka z ograniczoną odpowiedzialnością in liquidation, with its registered office in Oświęcim. The Issuer is the sole shareholder of this Company and represents 100% of the shares in its share capital.


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X. EFFECTS OF CHANGES IN THE ENTITY’S STRUCTURE, INCLUDING THOSE RESULTING

FROM BUSINESS COMBINATIONS, ACQUISITIONS OR DISPOSALS OF SYNTHOS S.A.

GROUP COMPANIES, LONG-TERM INVESTMENTS, SPLIT, RESTRUCTURING OR

DISCONTINUATION OF BUSINESS.

In the reporting period, the Issuer purchased 20,550 (in words: twenty thousand five hundred and fifty) shares in Oristano Investment Spółka z ograniczoną odpowiedzialnością, representing 100% of the Company’s share capital. Next, on 30 September 2014 the Issuer sold the Company’s business to its indirect subsidiary, Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością spółka jawna. On 15 October 2014, the Extraordinary General Shareholders’ Meeting passed a resolution on the dissolution of Oristano Investment sp. z o.o. and the commencement of its liquidation.

XI. THE MANAGEMENT BOARD’S POSITION WITH RESPECT TO THE POSSIBILITY OF

ACHIEVING THE RESULTS FOR THE CURRENT YEAR PRESENTED IN PREVIOUSLY

PUBLISHED FORECASTS IN THE LIGHT OF THE RESULTS PRESENTED IN THE

QUARTERLY REPORT COMPARED WITH THE FORECAST RESULTS.

The Management Board of Synthos S.A. did not publish any forecasts of the financial results of the Company and the Synthos S.A. Group for the third quarter of 2014.

XII. INDICATION OF THE SHAREHOLDERS DIRECTLY OR INDIRECTLY (THROUGH THEIR

SUBSIDIARIES) HOLDING AT LEAST 5% OF THE TOTAL NUMBER OF VOTES AT THE

GENERAL SHAREHOLDERS’ MEETING OF SYNTHOS S.A. AS AT THE DATE OF

RELEASE OF THE QUARTERLY REPORT.

As at 30 September 2014:

Mr. Michał Sołowow holds indirectly (through subsidiaries) 826,559,009 shares in SYNTHOS S.A., which represent 62.46% of the share capital and carry 826,559,009 votes at the GSM, representing 62.46% of the total number of votes at the GSM of SYNTHOS S.A. indirectly through FTF Galleon S.A., with its registered office in Luxembourg. The Company holds 826,559,009 shares in SYNTHOS S.A., which represent 62.46% of the share capital and the total number of votes at the GSM of SYNTHOS S.A.

Information on the holdings of the above-mentioned shareholders is provided by the Issuer on the basis of, inter alia, the list of shareholders who participated in the General Shareholders’ Meeting of SYNTHOS S.A. on 17 April 2014 and the list of shareholders entitled to a dividend, in accordance with the Issuer’s best knowledge.

In the period from January 2014 to the date of release of this Report, there were changes in the ownership structure of significant blocks of the Issuer’s shares. The Issuer provided information on these changes in its Current Reports Nos. 15/2014 and 19/2014.


16

XIII. SPECIFICATION OF SYNTHOS S.A. SHARES OR SHARE OPTIONS HELD BY MEMBERS

OF THE MANAGEMENT AND SUPERVISORY BODIES OF SYNTHOS S.A. AS AT THE

DATE OF RELEASE OF THIS QUARTERLY REPORT, INCLUDING INFORMATION ON ANY

CHANGES IN THE SHAREHOLDING FROM THE DATE OF THE PREVIOUS QUARTERLY

REPORT, FOR EACH PERSON SEPARATELY.

According to the Company’s knowledge (based on the notices provided by the obliged persons), members of the management bodies hold the blocks of Synthos S.A. shares presented in the following table.

No. Name Number of shares held

(as at 30.09.2014)

Change in the shareholding

in the period from 25.08.2014

to 30.09.2014

1.

Tomasz Kalwat

President of the Board

786 000

no change

2. Zbigniew Warmuz

Vice-President of the Board 0 no change

3. Tomasz Piec

Board Member

0

no change

4. Zbigniew Lange

Board Member 0 no change

5. Jarosław Rogoża

Board Member

0 no change

According to the Company’s knowledge (based on the notices provided by the obliged persons), members of the supervisory bodies hold the blocks of Synthos S.A. shares presented in the following table.


17

No. Name Number of shares held

(as at 30.09.2014)

Change in the shareholding

in the period from 25.08.2014

to 30.09.2014

1. Jarosław Grodzki

Chairman of the Supervisory Board 350 no change

2.

Mariusz Waniołka

Deputy Chairman of the Supervisory Board

0 no change

3.

Krzysztof Kwapisz

Deputy Chairman of the Supervisory Board

0 no change

4.

Grzegorz Miroński

Secretary of the Supervisory Board 0 no change

5. Robert Oskard

Supervisory Board Member 0 no change

XIV. INDICATION OF PROCEEDINGS PENDING BEFORE A COURT, A COURT OF

ARBITRATION OR A PUBLIC ADMINISTRATION AUTHORITY, INCLUDING

INFORMATION ON: A. PROCEEDINGS RELATING TO THE LIABILITIES OR RECEIVABLES

OF THE ISSUER OR ITS SUBSIDIARY WHOSE VALUE REPRESENTS NOT LESS THAN

10% OF THE ISSUER’S EQUITY; B. TWO OR MORE PROCEEDINGS RELATING TO THE

LIABILITIES AND RECEIVABLES WHOSE TOTAL VALUE REPRESENTS, RESPECTIVELY,

NOT LESS THAN 10% OF THE ISSUER’S EQUITY.

There were no such proceedings in the reporting period.

XV. INFORMATION ABOUT TRANSACTIONS CONCLUDED BY SYNTHOS S.A. OR ITS

SUBSIDIARY WITH RELATED ENTITIES ON TERMS OTHER THAN ARM’S-LENGTH, IF

THEY ARE MATERIAL EITHER INDIVIDUALLY OR CUMULATIVELY.

There were no such events in the reporting period.

XVI. INFORMATION ON LOAN GUARANTEES AND WARRANTIES GRANTED BY THE ISSUER

OR ITS SUBSIDIARY TO A SINGLE ENTITY OR ITS SUBSIDIARY, IF THE CUMULATIVE

AMOUNT OF THE EXISTING GUARANTEES OR WARRANTIES IS NOT LOWER THAN

10% OF THE ISSUER’S EQUITY.

The Issuer and its subsidiaries: Synthos Dwory 7 spółka z ograniczoną odpowiedzialnością sp. j., SYNTHOS Kralupy a.s., TAMERO INVEST s.r.o. and SYNTHOS PBR s.r.o. (as “the Guarantors”) granted a guarantee to Synthos Finance AB.


18

The guarantee granted by the Guarantors covers all of the obligations of Synthos Finance AB (publ) arising from the Bonds issued (including the obligation to pay the nominal value of the Bonds and interest on the Bonds) and was granted to all Bondholders. The maximum guarantee amount granted by the Issuer covers 150% of the nominal value of the Bonds issued. The guarantee will expire after the expiration of the Bondholders’ claims against Synthos Finance AB. The consideration received for granting the guarantee was paid on an arm’s length basis.

XVII. OTHER INFORMATION WHICH, IN THE OPINION OF SYNTHOS S.A., IS SIGNIFICANT

FOR THE ASSESSMENT OF THE COMPANY’S AND THE GROUP’S SITUATION IN TERMS

OF HUMAN RESOURCES, ASSETS, LIQUIDITY, FINANCIAL RESULT AND CHANGES

THEREOF, AND INFORMATION WHICH IS SIGNIFICANT FOR THE ASSESSMENT OF THE

ABILITY OF THE SYNTHOS S.A. GROUP TO SETTLE ITS LIABILITIES.

There is no such information.

XVIII. INDICATION OF FACTORS, WHICH IN THE OPINION OF SYNTHOS S.A. WILL AFFECT

THE RESULTS OF THE SYNTHOS S.A. GROUP AT LEAST IN THE NEXT QUARTER.

In the Company’s opinion, the following factors will have a significant effect on the results achieved by the Synthos S.A. Group in the coming quarters:

a. The completion of a number of projects extending the product offer and capital expenditure projects in the power sector by Synthos S.A. Group companies in recent years.

b. The slow recovery of economic growth in Poland and other EU countries which are the main sales markets for the products of the Synthos S.A. Group companies. In the case of the Polish economy, the reduction in interest rates by the Polish Monetary Policy Council in October 2014 may be very important. The record low borrowing costs should contribute to stimulating the level of economic activity in 2015, including in the construction sector.

c. Geographical diversification through boosting sales of the Synthos Group’s products on South American and North American markets. Pursuing a market development strategy which consists of making a more expansive entry into new sales markets with the existing products should increase sales and profits as early as within the next two years.

d. The escalation of the Ukrainian-Russian conflict which has already resulted in an economic recession in Ukraine and a significant drop in the rate of economic growth in Russia. In the near future, the international sanctions imposed on Russia and its retaliatory actions will also lead to negative economic consequences. At present, it is difficult to estimate the effect of the sanctions on the level of economic growth in the countries of the region and the entire EU. However, due to the Synthos S.A. Group’s exposure to Eastern markets being relatively low, it should not suffer any material consequences.


19

e. The situation in the market for replacement tyres. The situation in the European market for replacement tyres should improve slowly. In the longer term, a real growth in demand for tyres is expected on Asian markets, such as China and India, and, although to a smaller extent, on South American markets (mainly in Brazil). The tyre industry consumes ca. 70% of the global production of SBR.

f. The situation in the Polish construction sector which has a significant effect on the results of the dispersion and adhesives segments. According to the forecast by the National Institute for Market Economics (IBnGR), in 2015 the added value in the construction sector will increase by 6.1% compared with 5.3% in 2014. In 2015, the situation in this sector will be increasingly positively affected by infrastructural investments financed under the new budget perspective of the European Union (source: The condition of and a forecast for the level of economic activity, IBnGR, October 2014).

g. The gradual development of the product offer and an increase in the scale of the operations should contribute to an improvement in the results in the adhesives segment in the mid-term.

h. The rate of economic growth in China and the USA which determines, inter alia, the situation on the global petrochemical market. In the case of the USA, the unknown consequences of withdrawing from the programme of support for economic growth by following a lax monetary policy are a significant element.

i. The exchange rates of the Polish zloty and Czech koruna against the euro and American dollar.

j. Long-term effect of the tyre marking regulations resulting in an increase in demand for Nd BR and S-SBR rubber used in the manufacture of modern tyres with enhanced properties in the area of abrasion resistance, rolling resistance, and adhesion to wet surface.

SYNTHOS GROUP - Financial part of the report. (in thousands of zlotys, unless otherwise stated)

1

FINANCIAL INFORMATION 01.07.2014 – 30.09.2014 QUARTERLY REPORT


2

FINANCIAL PART OF THE REPORT (all figures in thousands of zlotys, unless otherwise stated)

I. CONSOLIDATED REPORT

Consolidated statement of comprehensive income for the 9 months ended 30 September

2014

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

restated

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Sales revenue 1 225 403 3 575 380 1 307 027 3 900 522

Cost of sales ( 1 020 351) ( 2 976 314) ( 1 144 030) ( 3 327 081)

Gross profit on sales 205 052 599 066 162 997 573 441

Other operating income 11 573 24 560 10 275 21 579

Selling costs ( 35 544) ( 102 092) ( 37 872) ( 108 037)

Administrative expenses ( 38 933) ( 118 733) ( 37 103) ( 114 944)

Other operating expenses ( 2 408) ( 10 845) ( 7 663) ( 23 683)

Operating profit 139 740 391 956 90 634 348 356

Finance income 990 3 303 11 410 17 604

Finance costs ( 2 122) ( 24 437) ( 12 232) ( 22 307)

Net finance costs ( 1 132) ( 21 134) ( 822) ( 4 703)

Profit before tax 138 608 370 822 89 812 343 653

Income tax ( 16 273) ( 79 580) ( 7 381) ( 37 257)

Net profit 122 335 291 242 82 431 306 396

Other comprehensive income that may be later

reclassified to profit or loss

Foreign exchange gains/ (losses) on translation

of subsidiaries and joint operations 883 12 148 ( 24 410) ( 292)

Measurement of available-for-sale financial

assets 6 263 ( 42 462) 9 994 51 589

Other comprehensive income (net) 7 146 ( 30 314) ( 14 416) 51 297

Total comprehensive income 129 481 260 928 68 015 357 693

Profit attributable to:

Shareholders of the parent company 122 102 290 858 82 288 306 010

Non-controlling interests 233 384 143 386

Net profit for the period 122 335 291 242 82 431 306 396

Comprehensive income attributable to:

Shareholders of the parent company 129 248 260 544 357 307 357 307


Comprehensive income for the period 129 481 260 928 357 693 357 693

Profit per share attributable to the Company's

shareholders in the perod (in PLN per share):

Basic (PLN) 0,09 0,22 0,06 0,23

Diluted (PLN) 0,09 0,22 0,06 0,23


3

Costs by type

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

restated

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Amortization and depreciation 37 614 115 390 40 210 119 787

Materials and energy used 878 918 2 555 407 866 521 2 688 371

External services 92 114 198 992 88 161 201 627

Taxes and fees 6 137 17 810 6 078 18 975

Wages and salaries 31 542 99 438 31 349 100 744

Social insurance and similar charges 8 632 28 697 9 123 30 054

Other costs by type 4 789 15 983 8 114 17 912

Total costs by type 1 059 746 3 031 717 1 049 556 3 177 470

Changes in inventories, finished goods, and

prepayments ( 27 274) ( 7 085) 126 850 164 733

Changes in settled expenses 230 ( 2 244) 1 964 735

Selling costs (a negative amount) ( 35 544) ( 102 092) ( 37 872) ( 108 037)

Administrative expenses (a negative amount) ( 38 933) ( 118 733) ( 37 103) ( 114 944)

Cost of products sold 958 225 2 801 563 1 103 395 3 119 957

Cost of goods for resale and materials sold 62 126 174 751 40 635 207 124

Cost of sales 1 020 351 2 976 314 1 144 030 3 327 081

Revenues from sales

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

restated

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Revenues from sales of products 1 160 171 3 385 502 1 245 477 3 687 704

Revenues from sales of services 5 718 18 086 6 078 17 734

Revenues from sales of materials and goods 59 249 170 903 54 991 193 574

Income from rental of investment properties 265 889 481 1 510

Total sales 1 225 403 3 575 380 1 307 027 3 900 522


4

Consolidated statement of financial position as at 30 September 2014

30.09.2014 30.06.2014 31.12.201330.09.2013

restated30.06.2013

Non-current assets

Property, plant and equipment 1 775 844 1 702 625 1 646 299 1 651 486 1 652 601

Intangible assets 165 565 161 554 151 393 139 679 135 840

Prepayment for perpetual of land 973 - - - -

Investment property 441 456 483 3 294 3 338

Shares in subsidiaries 44 142 2 295 2 106 2 116 2 118

Goodwill 1 929 4 475 - - -

Loans granted 2 097 1 067 726 513 513

Available-for-sale financial assets 216 955 210 520 258 715 238 747 229 002

Deferred tax assets 25 763 29 929 81 894 89 341 91 963

Total non-current assets 2 233 709 2 112 921 2 141 616 2 125 176 2 115 375

Current assets

Inventories 468 155 442 903 454 931 436 483 613 698

Income tax receivables 39 455 73 429 66 296 68 691 55 599

Trade and other receivables 1 072 545 1 062 340 913 208 1 125 401 1 213 110

Cash and cash equivalents 655 695 180 191 447 055 503 430 633 061

Total current assets 2 235 850 1 758 863 1 881 490 2 134 005 2 515 468

Total assets 4 469 559 3 871 784 4 023 106 4 259 181 4 630 843

Equity and liabilities

Equity

Share capital 39 698 39 698 39 698 39 698 39 698

Revaluation reserve 32 775 26 512 75 237 55 421 45 427

Foreign exchange gains and losses on

translation of subordinated entities3 512 2 629 ( 8 636) 109 752 134 162

Retained earnings, including: 2 051 789 1 929 688 2 171 139 2 060 258 1 977 970

net profit of the current period 290 858 168 756 416 891 306 010 223 722

Equity attributable to equity holders of the

parent 2 127 774 1 998 527 2 277 438 2 265 129 2 197 257

Non-controlling interests 14 207 13 974 13 823 15 003 14 860

Total equity 2 141 981 2 012 501 2 291 261 2 280 132 2 212 117

Liabilities

Liabilities in respect of bonds 1 461 425 - - - -

Liabilities in respect of loans, borrowings 5 334 587 267 428 873 407 572 434 530

Employee benefit liabilities 3 740 3 765 3 816 4 288 4 288

Deferred income and income from

government subsidies99 310 66 141 42 761 37 874 18 550

Provisions 30 260 30 260 30 260 30 260 30 260

Deferred tax 43 919 41 253 42 147 44 010 44 689

Other liabilities 28 457 28 400 28 363 30 762 31 287

Total long-term liabilities 1 672 445 757 086 576 220 554 766 563 604

Overdrafts - 371 071 456 231 637 488 616 331

Liabilities in respect of loans, borrowings

and other debt instruments3 556 128 248 131 644 183 619 185 791

Employee benefit liabilities 150 150 150 219 221

Income tax liabilities 4 397 1 402 3 969 5 913 21 969

Dividend payable - - - - 344 045

Trade and other payables 638 684 593 944 554 954 584 494 675 502

Provisions 4 000 3 992 3 951 4 227 4 293

Derivatives 4 346 3 390 4 726 8 323 6 970

Total short-term liabilities 655 133 1 102 197 1 155 625 1 424 283 1 855 122

Total liabilities 2 327 578 1 859 283 1 731 845 1 979 049 2 418 726

Total equity and liabilities 4 469 559 3 871 784 4 023 106 4 259 181 4 630 843


5

30.09.2014 30.06.2014 31.12.2013 30.09.2013 30.06.2013

Carrying amount 2 141 981 2 012 501 2 291 261 2 280 132 2 212 117

Number of shares (in units) 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Weighted average number of shares 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Book value per share (in PLN) 1,62 1,52 1,73 1,72 1,67

Diluted number of shares (in units) 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Diluted book value per share (in PLN) 1,62 1,52 1,73 1,72 1,67


6

Consolidated statement of changes in equity for the 9 months ended 30 September 2014

Share capital Other reserves

Retained

earnings

Foreign

exchange

differences

on

translation

Revaluation

reserve

Attributable

to non-

controll ing

interests Total equity

1 January 2014 39 698 - 2 171 139 ( 8 636) 75 237 13 823 2 291 261

Payment of dividend - - ( 410 208) - - - ( 410 208)

Total comprehensive income - - 290 858 12 148 - 42 462 384 260 928

30 September 2014 39 698 - 2 051 789 3 512 32 775 14 207 2 141 981


Retained

earnings

Foreign

exchange

differences

on

translation

Revaluation

reserve

Attributable

to non-

controll ing

interests Total equity

1 January 2013 39 698 252 875 2 507 043 110 044 3 832 14 617 2 928 109

Payment of dividend - - ( 1 005 670) - - - ( 1 005 670)

Reclassification - ( 252 875) 252 875 - - - -

Total comprehensive income - - 306 010 ( 292) 51 589 386 357 693

30 September 2013 39 698 - 2 060 258 109 752 55 421 15 003 2 280 132

Attributable to shareholders of the Company



7

Consolidated statement of cash flows for the 9 months ended 30 September 2014

Q3 2014 period

from 2014-07-01 to

2014-09-30

Q3 2014 period

from 2014-01-01 to

2014-09-30

Q3 2013 period

from 2013-07-01 to

2013-09-30

restated

Q3 2013 period

from 2013-01-01 to

2013-09-30

restated


Adjustments:


Foreign exchange (gains)/ losses ( 1 292) 6 380 ( 12 861) ( 6 484)

(Gains)/losses on investing activities 1 311 859 564 3 561

(Gains)/ losses on disposal of fixed assets ( 3 856) ( 5 737) ( 209) ( 170)

Interest 4 716 12 709 5 267 9 651

Others ( 1 344) ( 745) - -

Operating profit before changes in working capital 175 757 499 678 122 783 469 998

Change in receivables ( 5 329) ( 109 927) 38 289 ( 62 989)

Change in inventories ( 17 232) ( 2 370) 193 152 199 848

Change in trade and other payables 13 737 29 079 ( 31 646) ( 20 735)

Change in employee benefit l iabil ities ( 25) ( 76) - -

Cash flows generated from operating activities 166 908 416 420 322 457 586 160

Tax paid 27 214 4 970 ( 35 649) ( 83 767)

Net cash flows from operating activities 194 122 421 390 286 808 502 393

Cash flows from investing activities

Disposal of intangible assets and property, plant and

equipment 9 851 11 578 281 676

Dywidendy otrzymane 0 0 0 0

Interest received 266 2 016 865 5 849

Subsidies received 33 911 56 985 - -

Proceeds from forward transactions realized 85 2 357 408 408

Purchase of intangible assets and property, plant and

equipment ( 92 119) ( 236 442) ( 75 896) ( 194 121)

Purchase of shares in subsidiaries ( 41 848) ( 49 596) - -

Loans granted ( 1 175) ( 1 492) - -

Cash pool received/(granted) 11 420 ( 11 151) ( 3 775) ( 30 891)

Net cash from investing activities ( 79 609) ( 225 745) ( 78 117) ( 218 079)

Cash flows from financing activities

Loans and borrowings received - 276 122 - -

Overdrafts (repaid)/taken ( 371 618) ( 456 107) 21 157 588 587

Outflows in respect of swap transactions ( 267) ( 3 343) ( 972) ( 3 969)

Dividends and other payments to shareholders ( 931) ( 411 122) ( 344 046) ( 1 005 633)

Outflows on repayment of loans and borrowings ( 706 785) ( 826 004) ( 13 644) ( 100 945)

Issue of bonds 1 445 081 1 445 081 - -

Interest paid ( 5 170) ( 15 194) ( 5 567) ( 14 676)

Net cash from financing activities 360 310 9 433 ( 343 072) ( 536 636)

Net increase/(decrease) in cash and cash equivalents 474 823 205 078 ( 134 381) ( 252 322)

Change in cash and cash equivalents in the balance sheet,

including:

475 504

208 640 ( 129 631) ( 243 171)

Cash and cash equivalents at the beginning of the year 180 191 447 055 633 061 746 601

Effect of changes in foreign exchange differences on cash

and cash equivalents 681 3 562 4 750 9 151

Cash and cash equivalents at the end of the year 655 695 655 695 503 430 503 430


8

II. SEPARATE REPORT

Separate statement of comprehensive income for the 9 months ended 30 September 2014

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

Q3 2013 period

from 2013-01-01

to 2013-09-30

Revenues from sales 26 560 79 040 24 141 72 030

Cost of sales ( 23 020) ( 68 168) ( 22 125) ( 64 874)

Gross profit on sales 3 540 10 872 2 016 7 156

Other operating income 21 2 129 109 164

Administrative expenses ( 1 291) ( 5 085) ( 587) ( 2 479)

Other operating expenses ( 49) ( 291) ( 261) ( 696)

Dividends - 990 683 - 477 403

Operating profit 2 221 998 308 1 277 481 548

Finance income 10 282 17 726 557 1 136

Finance costs ( 3 568) ( 15 823) ( 1 452) ( 8 407)

Net finance income / (costs) 6 714 1 903 ( 895) ( 7 271)


Income tax ( 2 329) ( 2 751) ( 160) ( 3 655)

Net profit 6 606 997 460 221 470 622

Other comprehensive income that may be

later reclassified to profit or loss

Foreign exchange differences on

translation of a foregin branch 1 262 1 027 ( 1 194) 447

Measurement of available-for-sale

financial assets 733 2 991 ( 1 066) ( 522)

Other comprehensive income (net) 1 995 4 018 ( 2 260) ( 75)

Total comprehensive income 8 601 1 001 478 ( 2 039) 470 547

Basic (PLN) 6 606 997 460 221 470 622

Diluted (PLN) 6 606 997 460 221 470 622

Earnings per share:

Basic (PLN) 0,00 0,75 0,00 0,36

Diluted (PLN) 0,00 0,75 0,00 0,36


9

Costs by type

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

Q3 2013 period

from 2013-01-01

to 2013-09-30


Materials and energy used 794 2 349 718 2 449

External services 7 201 18 492 4 235 15 658

Taxes and fees 88 316 80 238

Wages and salaries 9 727 29 411 8 735 26 714

Social insurance and similar charges 1 687 6 000 1 743 5 899

Other costs by type 2 415 8 586 4 873 9 912

Total costs by type 24 311 73 253 22 712 67 353

Administrative expenses (a negative

amount) ( 1 291) ( 5 085) ( 587) ( 2 479)

Cost of sales 23 020 68 168 22 125 64 874

Revenues from sales

Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

Q3 2013 period

from 2013-01-01

to 2013-09-30

Revenues from sales of services 26 560 79 040 24 141 72 030

Total revenues from sales 26 560 79 040 24 141 72 030


10

Separate statement of financial position as at 30 September 2014

30.09.2014 30.06.2014 31.12.201330.09.2013

restated30.06.2013

Assets

Non-current assets

Property, plant and equipment 44 103 45 972 68 201 56 962 43 417

Intangible assets 89 244 85 614 73 962 59 858 56 931

Shares in subsidiaries 736 585 694 507 642 895 642 895 642 895

Long-term financial assets 574 000 574 000 - - -

Loans granted 1 190 408 387 44 644 48 251 7 334

Available-for-sale financial assets 10 516 9 611 6 823 6 018 48 938

Deferred tax assets - 1 585 2 397 2 176 1 970

Total non-current assets 2 644 856 1 411 676 838 922 816 160 801 485

Current assets

Current financial assets 17 411 7 143 - - -

Income tax receivables 92 136 8 26 -

Trade and other receivables 57 967 56 759 33 552 35 102 32 737

Cash and cash equivalents 257 461 2 943 3 317 2 824 354 741

Total current assets 332 931 66 981 36 877 37 952 387 478

Total assets 2 977 787 1 478 657 875 799 854 112 1 188 963

Equity

Share capital 39 698 39 698 39 698 39 698 39 698

Revaluation reserve 3 936 3 203 945 293 1 359

Foreign exchange differences on

translation of a foreign branch ( 5 310) ( 6 572) ( 6 337) ( 99) 1 095

Retained earnings, including: 1 088 153 1 081 547 500 901 502 114 501 892

Current net profit/(loss) 997 460 990 854 469 409 470 622 470 400

Total equity 1 126 477 1 117 876 535 207 542 006 544 044

Liabilities

Liabilities in respect of bonds 1 436 376 - - 240 000 240 000


and other debt instruments - 81 143 68 965 - -


Deferred revenue from government

subsidies18 543 11 188 8 227 6 607 -

Deferred tax 771 - - - -

Total long-term liabilities 1 456 030 92 672 77 534 247 022 240 415

Liabilities in respect of bonds 252 734 250 187 245 177 2 630 -


and other debt instruments 124 933 - - 41 289 25 841


Income tax liabilities - - - - 33

Trade and other payables 17 602 17 911 17 870 21 138 378 603

Provisions - - - 13 13

Total short-term liabilities 395 280 268 109 263 058 65 084 404 504

Total liabilities 1 851 310 360 781 340 592 312 106 644 919

Total equity and liabilities 2 977 787 1 478 657 875 799 854 112 1 188 963


11

Off-balance sheet items in PLN '000

30.09.2014 30.06.2014 31.12.2013 30.09.2013 30.06.2013

2. Contingent liabilities 1 761 425 1 445 506 1 444 451 701 116 719 890

2.1. To related entities 1 761 425 1 445 506 1 444 451 701 116 719 890

- Guarantee for Synthos Finance AB - bond

repayment guarantee * 1 611 425 - - - -

- guarantee of loan instalments 150 000 1 445 506 1 444 451 701 116 719 890

Total off-balance-sheet items ( 1 761 425) ( 1 445 506) ( 1 444 451) ( 701 116) ( 719 890)

*Issuers of the guarantee: Synthos SA, SD 7 Sp. z o.o. sp. j., Synthos Kralupy a.s., Synthos PBR s.r.o., Tamero Invest s.r.o.

30.09.2014 30.06.2014 31.12.2013 30.09.2013 30.06.2013

Carrying amount 1 126 477 1 117 876 535 207 542 006 544 044

Number of shares (in units) 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Weighted average number of shares 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Book value per share (in PLN) 0,85 0,84 0,40 0,41 0,41

Diluted number of shares (in units) 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000 1 323 250 000

Diluted book value per share (in PLN) 0,85 0,84 0,40 0,41 0,41


12

Statement of changes in equity for the 9 months ended 30 September 2014


Retained

earnings

Foreign

exchange

differences on

translation

Revaluation

reserve Total equity

1 January 2014 39 698 - 500 901 ( 6 337) 945 535 207

Payment of dividend - ( 410 208) - - ( 410 208)

Total comprehensive income - - 997 460 1 027 2 991 1 001 478

30 September 2014 39 698 - 1 088 153 ( 5 310) 3 936 1 126 477


Retained

earnings

Foreign

exchange

differences on

translation

Revaluation

reserve Total equity

1 January 2013 39 698 252 875 784 287 ( 546) 815 1 077 129

Payment of dividend - - ( 1 005 670) - - ( 1 005 670)

Reclassification - ( 252 875) 252 875 - - -

Total comprehensive income - - 470 622 447 ( 522) 470 547

30 September 2013 39 698 - 502 114 ( 99) 293 542 006




13

Separate statement of cash flows for the 9 months ended 30 September 2014 Q3 2014 period

from 2014-07-01

to 2014-09-30

Q3 2014 period

from 2014-01-01

to 2014-09-30

Q3 2013 period

from 2013-07-01

to 2013-09-30

Q3 2013 period

from 2013-01-01

to 2013-09-30


Adjustments


Dividends received - ( 985 792) - ( 477 403)

Foreign exchange (gains)/ losses 510 588 ( 712) ( 6)

(Gains)/ losses on disposal of fixed assets ( 9) ( 2 083) ( 26) ( 13)

Interest ( 7 098) ( 8 249) 2 073 6 990

Others ( 6) ( 16) - -

Operating profit before changes in working capital 4 731 12 758 4 045 10 328

Change in receivables ( 5 867) ( 24 051) ( 8 236) ( 19 349)

Change in trade and other payables 2 038 7 032 8 891 12 297

Change in employee benefit l iabil ities ( 4) ( 2) - -

Cash flows generated from operating activities 898 ( 4 263) 4 700 3 276

Tax paid ( 101) ( 155) ( 174) ( 457)

Net cash from operating activities 797 ( 4 418) 4 526 2 819


Disposal of intangible assets and property, plant

and equipment 5 377 5 543 40 168

Dividends received - 411 792 - 771 599

Interest received 11 236 428 750

Subsidies received 7 360 10 331 - -

Purchase of intangible assets and property, plant

and equipment ( 5 958) ( 9 135) ( 28 993) ( 55 452)

Purchase of shares in dependent parties ( 42 078) ( 49 827) - -

Borrowings granted ( 1 192 525) ( 1 192 525) - -

Net cash from investing activities ( 1 227 813) ( 823 585) ( 28 525) 717 065

Loans and borrowings received 42 635 74 954 16 173 35 158

Outflows on repayment of loans and borrowings - ( 21 497) - -

Issue of bonds 1 439 403 1 439 403 - 240 000

Dividends and other payments to shareholders - ( 410 191) ( 344 026) ( 1 005 613)

Net cash from financing activities 1 482 038 1 082 669 ( 327 853) ( 730 455)

Net increase/(decrease) in cash and cash equivalents 255 022 254 666 ( 351 852) ( 10 571)

Change in cash and cash equivalents in the balance

sheet, including: 254 518 5 866 ( 351 917) ( 10 602)

Cash and cash equivalents at the beginning of the

year 2 943 3 317 354 741 13 426

Effect of changes resulting from foreign exchange

differences on cash and cash equivalents 504 522 65 31

Cash and cash equivalents at the end of the year 257 461 257 461 2 824 2 824


14

III. Operating segment report

Business segments

30.09.2014 30.09.2013 30.09.2014 30.09.2013 30.09.2014 30.09.2013 30.09.2014 30.09.2013 30.09.2014 30.09.2013 30.09.2014 30.09.2013

Sales revenue

Sales of goods/finished products

(external customers) 1 821 053 2 100 148 1 480 304 1 520 134 99 544 88 538 137 630 164 592 17 875 7 865 3 556 406 3 881 277

Sales of services 18 086 17 735 18 086 17 735

Rental income 888 1 510 888 1 510

Total income 1 821 053 2 100 148 1 480 304 1 520 134 99 544 88 538 137 630 164 592 36 849 27 110 3 575 380 3 900 522

Total costs 1 581 022 1 851 694 1 381 402 1 472 644 99 076 85 658 115 133 127 400 20 506 12 666 3 197 139 3 550 062

Segment result 240 031 248 454 98 902 47 490 468 2 880 22 497 37 192 16 343 14 444 378 241 350 460

Unallocated income 24 560 21 579

Unallocated costs 10 845 23 683

Operating profit 240 031 248 454 98 902 47 490 468 2 880 22 497 37 192 16 343 14 444 391 956 348 356

Finance income 3 303 17 604

Finance costs 24 437 22 307

Profit before tax 240 031 248 454 98 902 47 490 468 2 880 22 497 37 192 16 343 14 444 370 822 343 653

Corporate income tax 79 580 37 257

Net profit 240 031 248 454 98 902 47 490 468 2 880 22 497 37 192 16 343 14 444 291 242 306 396

Segment assets 1 471 604 1 390 313 948 662 1 006 684 52 969 53 641 430 636 317 253 234 354 230 104 3 138 225 2 997 995

Unallocated assets 1 331 334 1 261 186

Total assets 1 471 604 1 390 313 948 662 1 006 684 52 969 53 641 430 636 317 253 234 354 230 104 4 469 559 4 259 181

Capital expenditure 136 334 96 736 17 247 21 090 713 3 054 67 683 27 848 14 465 45 393 236 442 194 121

Amortization and depreciation 26 521 28 062 44 999 50 543 4 461 4 117 18 712 17 232 20 697 19 833 115 390 119 787

TotalOtherRubber and Latex Styrene derivatives Vinyl dispersions Energy

Geographic information

30.09.2014 30.09.2013 30.09.2014 30.09.2013 30.09.2014 30.09.2013

Segment revenue (sales to third party customers) 2 892 931 3 172 759 682 449 727 763 3 575 380 3 900 522

Poland, Czech Republic Other countries Total


15

IV. Change in the accounting policies resulting from the application of IFRS 11

In accordance with IFRS 11, joint arrangements are classified as joint ventures or joint operations. The

Group analysed a joint arrangement (Butadien Kralupy a.s.) existing as at 1 January 2013 in the light of

IFRS 11 and concluded that it satisfied the conditions for being classified as a joint operation on the basis

of the assessment of other facts and circumstances in accordance with IFRS 11, paragraph B29-B33.

Butadien Kralupy a.s. is a separate legal entity, however, due to the agreement in place between the

shareholders, the parties are obliged to purchase products manufactured by the joint operation.

Therefore, in practice the parties are the sole source of cash flows for continuation of the joint operation

and the parties have rights to substantially all of the benefits from assets of this joint operation and are

required to meet its liabilities.

Pursuant to IFRS 11, a new accounting policy was applied to recognize interest in a joint operation. The

Group removed the shares in Butadien Kralupy a.s. (recognized under the equity method) from the

balance sheet and recognized the percentage interest in the assets and liabilities of a joint arrangement

instead. The Group determines the part of assets and liabilities, as well as non-operating income and

costs relating to joint operations, which is attributable to the Group, on the basis of its rights and

obligations in the proportion resulting from the contract, amounting to 49% (i.e. the percentage of share

in capital held in Butadien Kralupy a.s.). The Group determines the part of operating income and costs

relating to joint operations, which is attributable to the Group, based on its percentage share in the sales

of the joint operation.

The transactions and balances from joint operations were eliminated. In The Group liabilities / assets

there is liabilitiy to / receivable from the other operator of joint operation recognized respectively to

compensate the Group’s share to the level of 49% share of the net profit from joint operation and share

of the net assets of Butadiene Kralupy a.s.

The Group restated the comparative figures as at 30 September 2013, as at 31 March 2014, as at 31

March 2013, to comply with IFRS 11.

Restated consolidated statement of financial position as at 30 September 2013

30.09.2013

publishedAdjustment 30.09.2013

restated

Non-current assets

Property, plant and equipment 1 575 975 75 511 1 651 486

Intangible assets 129 743 9 936 139 679

Investment property 3 294 3 294

Shares in subsidiaries 2 116 2 116

Shares in entities accounted for under the

equity method90 068

( 90 068) -

Loans granted 45 738 ( 45 225) 513

Available-for-sale financial assets 238 747 238 747

Deferred tax assets 89 341 89 341

Total non-current assets 2 175 022 ( 49 846) 2 125 176

Current assets

Borrowings granted 7 538 ( 7 538) -

Inventories 432 371 4 112 436 483

Income tax receivables 68 691 68 691

Trade and other receivables 1 119 718 5 683 1 125 401

Cash and cash equivalents 503 410 20 503 430

Total current assets 2 131 728 2 277 2 134 005

Total assets 4 306 750 ( 47 569) 4 259 181


16


Equity

Share capital 39 698 39 698

Revaluation reserve 55 421 55 421


translation of subordinated entities 109 752109 752

Retained earnings, including: 2 060 258 2 060 258

net profit of the current period 306 010 306 010


parent 2 265 129

- 2 265 129


Total equity 2 280 132 - 2 280 132

Liabilities


and other debt instruments 384 507 23 065 407 572

Employee benefit liabilities 4 288 4 288


government subsidies 37 87437 874

Provisions 30 260 30 260

Deferred tax 43 661 349 44 010

Other liabilities 30 762 30 762

Total long-term liabilities 531 352 23 414 554 766

Overdrafts 637 488 637 488



Employee benefit liabilities 219 219

Income tax liabilities 4 006 1 907 5 913

Trade and other payables 661 228 ( 76 734) 584 494


Derivatives 8 323 8 323

Total short-term liabilities 1 495 266 ( 70 983) 1 424 283

Total liabilities 2 026 618 ( 47 569) 1 979 049

Total equity and liabilities 4 306 750 ( 47 569) 4 259 181


17

Restated consolidated statement of financial position as at 31 March 2014

31.03.2014


restated

Non-current assets



Investment property 470 470



equity method90 603

( 90 603) -

Loans granted 14 845 ( 13 964) 881




Current assets


Inventories 466 312 6 097 472 409


Trade and other receivables 993 006 ( 14 069) 978 937


Total current assets 2 146 918 ( 14 932) 2 131 986

Total assets 4 311 311 ( 42 658) 4 268 653


Equity




translation of subordinated entities ( 3 390) ( 3 390)




parent 2 349 685

- 2 349 685


Total equity 2 363 487 - 2 363 487

Liabilities

Overdrafts 509 417 509 417


and other debt instruments 472 284 7 121479 405





Deferred tax 41 859 613 42 472


Total long-term liabilities 1 161 424 7 734 1 169 158




Income tax liabilities 2 582 995 3 577




Total short-term liabilities 786 400 ( 50 392) 736 008




18

Restated consolidated statement of financial position as at 31 March 2013

31.03.2013


restated

Non-current assets



Investment property 3 382 3 382



equity method80 259

( 80 259) -

Loans granted 48 908 ( 48 397) 511




Current assets


Inventories 733 787 8 181 741 968


Trade and other receivables 1 238 648 ( 8 553) 1 230 095


Total current assets 2 659 403 ( 7 802) 2 651 601

Total assets 4 738 104 ( 49 040) 4 689 064


Equity




translation of subordinated entities 100 833 100 833

Other reserves 252 875 252 875




parent 3 049 517

- 3 049 517


Total equity 3 064 279 - 3 064 279

Liabilities







Deferred tax 43 121 1 43 122


Total long-term liabilities 597 075 24 683 621 758

Overdrafts 79 319 79 319




Income tax liabilities 14 004 5 895 19 899




Total short-term liabilities 1 076 750 ( 73 723) 1 003 027




19

Q3 2013 period

from 2013-01-01

to 2013-09-30

published

Adjustment

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Sales revenue 4 186 841 ( 286 319) 3 900 522

Cost of sales ( 3 633 165) 306 084 ( 3 327 081)

Gross profit on sales 553 676 19 765 573 441

Other operating income 21 579 21 579

Selling costs ( 108 037) ( 108 037)

Administrative expenses ( 114 944) ( 114 944)

Other operating expenses ( 23 683) ( 23 683)

Operating profit 328 591 19 765 348 356


Finance costs ( 22 307) ( 22 307)

Net finance costs ( 4 703) - ( 4 703)

Share in profits of companies recognised under

the equity method 16 007 ( 16 007) -

Profit before tax 339 895 3 758 343 653

Income tax ( 33 499) ( 3 758) ( 37 257)

Net profit 306 396 - 306 396




of subsidiaries and joint operations ( 292) ( 292)


assets 51 589 51 589

Other comprehensive income (net) 51 297 - 51 297

Total comprehensive income 357 693 - 357 693


Shareholders of the parent company 306 010 306 010

Non-controlling interests 386 386

Net profit for the period 306 396 - 306 396




Comprehensive income for the period 357 693 357 693



Basic (PLN) 0,23 0,00 0,23

Diluted (PLN) 0,23 0,00 0,23

Restated consolidated statement of comprehensive income for the 9 months ended 30 September 2013


20

Costs by type

Q3 2013 period

from 2013-01-01

to 2013-09-30

published

Adjustment

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Amortization and depreciation 115 195 4 592 119 787

Materials and energy used 2 763 069 ( 74 698) 2 688 371

External services 205 572 ( 3 945) 201 627

Taxes and fees 18 970 5 18 975

Wages and salaries 99 788 956 100 744

Social insurance and similar charges 29 700 354 30 054

Other costs by type 17 602 310 17 912

Total costs by type 3 249 896 ( 72 426) 3 177 470


prepayments 164 636 97 164 733

Changes in settled expenses 737 ( 2) 735

Selling costs (a negative amount) ( 108 037) ( 108 037)

Administrative expenses (a negative amount) ( 114 944) ( 114 944)

Cost of products sold 3 192 288 ( 72 331) 3 119 957

Cost of goods for resale and materials sold 440 877 ( 233 753) 207 124

Cost of sales 3 633 165 ( 306 084) 3 327 081

Revenues from sales

Q3 2013 period

from 2013-01-01

to 2013-09-30

published

Adjustment

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated

Revenues from sales of products 3 733 049 ( 45 345) 3 687 704

Revenues from sales of services 24 956 ( 7 222) 17 734

Revenues from sales of materials and goods 427 326 ( 233 752) 193 574

Income from rental of investment properties1 510 1 510

Total sales 4 186 841 ( 286 319) 3 900 522


21

Q1 2014 period

from 2014-01-01

to 2014-03-31

published

Adjustment

Q1 2014 period

from 2014-01-01

to 2014-03-31

restated

Sales revenue 1 279 564 ( 93 464) 1 186 100

Cost of sales ( 1 084 095) 101 023 ( 983 072)



Selling costs ( 35 064) ( 35 064)





Finance costs ( 8 679) ( 8 679)





Income tax ( 13 230) ( 1 438) ( 14 668)

Net profit 108 058 - 108 058




of subsidiaries and joint operations 5 246 5 246


assets ( 41 078) ( 41 078)

Other comprehensive income (net) ( 35 832) - ( 35 832)




Non-controlling interests ( 21) ( 21)




Non-controlling interests ( 21) ( 21)




Basic (PLN) 0,08 0,00 0,08

Diluted (PLN) 0,08 0,00 0,08

Restated consolidated statement of comprehensive income for the 3 months ended 31 March 2014


22

Costs by type

Q1 2014 period

from 2014-01-01

to 2014-03-31

published

Adjustment

Q1 2014 period

from 2014-01-01

to 2014-03-31

restated


Materials and energy used 885 301 ( 16 557) 868 744








prepayments ( 26 865) 855 ( 26 010)

Changes in settled expenses 2 383 2 383



Cost of products sold 940 549 ( 24 292) 916 257


Cost of sales 1 084 095 ( 101 023) 983 072

Revenues from sales

Q1 2014 period

from 2014-01-01

to 2014-03-31

published

Adjustment

Q1 2014 period

from 2014-01-01

to 2014-03-31

restated




Income from rental of investment properties312 312

Total sales 1 279 564 ( 93 464) 1 186 100


23

Q1 2013 period

from 2013-01-01

to 2013-03-31

published

Adjustment

Q1 2013 period

from 2013-01-01

to 2013-03-31

restated

Sales revenue 1 432 771 ( 109 859) 1 322 912

Cost of sales ( 1 202 666) 118 687 ( 1 083 979)



Selling costs ( 36 883) ( 36 883)





Finance costs ( 6 190) ( 6 190)





Income tax ( 21 384) ( 1 684) ( 23 068)

Net profit 135 003 - 135 003




of subsidiaries and joint operations ( 9 211) ( 9 211)


assets 10 378 10 378

Other comprehensive income (net) 1 167 - 1 167












Basic (PLN) 0,10 0,00 0,10

Diluted (PLN) 0,10 0,00 0,10

Restated consolidated statement of comprehensive income for the 3 months ended 31 March 2013


24

Costs by type

Q1 2013 period

from 2013-01-01

to 2013-03-31

published

Adjustment

Q1 2013 period

from 2013-01-01

to 2013-03-31

restated


Materials and energy used 1 027 475 ( 25 831) 1 001 644








prepayments ( 76 289) 717 ( 75 572)

Changes in settled expenses ( 946) ( 946)



Cost of products sold 1 035 410 ( 24 270) 1 011 140


Cost of sales 1 202 666 ( 118 687) 1 083 979

Revenues from sales

Q1 2013 period

from 2013-01-01

to 2013-03-31

published

Adjustment

Q1 2013 period

from 2013-01-01

to 2013-03-31

restated




Income from rental of investment properties 499 499

Total sales 1 432 771 ( 109 859) 1 322 912


25

Q3 2013

period from

2013-01-01 to

2013-09-30

published

Adjustment

Q3 2013 period

from 2013-01-01

to 2013-09-30

restated


Adjustments:


Foreign exchange (gains)/ losses ( 6 944) 460 ( 6 484)

(Gains)/losses on investing activities 3 561 3 561

(Gains)/ losses on disposal of fixed assets ( 170) ( 170)

Interest 9 651 9 651

Share in profits of companies recognised under the

equity method ( 16 007) 16 007 -

Operating profit before changes in working capital 445 181 24 817 469 998

Change in receivables ( 87 276) 24 287 ( 62 989)

Change in inventories 198 729 1 119 199 848

Change in trade and other payables ( 16 001) ( 4 734) ( 20 735)

Change in provisions 38 38

Cash flows generated from operating activities 540 671 45 489 586 160

Tax paid ( 77 922) ( 5 845) ( 83 767)

Net cash flows from operating activities 462 749 39 644 502 393



equipment 676 676

Repayments of loans granted 7 495 ( 7 495) -

Interest received 5 845 4 5 849

Proceeds from forward transactions realized 408 408


equipment ( 193 363) ( 758) ( 194 121)

Cash pool received/(granted) - ( 30 891) ( 30 891)

Net cash from investing activities ( 178 939) ( 39 140) ( 218 079)


Overdrafts (repaid)/taken 588 587 588 587

Outflows in respect of swap transactions ( 3 969) ( 3 969)

Dividends and other payments to shareholders ( 1 005 633) ( 1 005 633)

Outflows on repayment of loans and borrowings ( 100 945) ( 100 945)

Interest paid ( 14 178) ( 498) ( 14 676)

Net cash from financing activities ( 536 138) ( 498) ( 536 636)

Net increase/(decrease) in cash and cash equivalents ( 252 328) 6 ( 252 322)


including:

( 243 177)

6 ( 243 171)

Cash and cash equivalents at the beginning of the year 746 587 14 746 601


and cash equivalents 9 151 9 151

Cash and cash equivalents at the end of the year 503 410 20 503 430

Restated consolidated cash flow statement for the 9 months ended 30 September 2013


26

Q1 2014

period from

2014-01-01 to

2014-03-31

published

Adjustment

Q1 2014 period

from 2014-01-01

to 2014-03-31

restated


Adjustments:


Foreign exchange (gains)/ losses ( 451) ( 451)

(Gains)/losses on investing activities ( 2 084) ( 2 084)

(Gains)/ losses on disposal of fixed assets 662 662

Interest 3 932 59 3 991


equity method ( 6 121) 6 121 -

Others 1 015 1 015


Change in receivables ( 49 106) ( 1 887) ( 50 993)

Change in inventories ( 14 501) 1 098 ( 13 403)

Change in trade and other payables 6 375 1 353 7 728

Change in provisions ( 20) ( 20)

Cash flows generated from operating activities 98 151 9 627 107 778

Tax paid ( 3 414) ( 1 088) ( 4 502)

Net cash flows from operating activities 94 737 8 539 103 276



equipment 669 669

Repayments of loans granted 3 491 ( 3 491) -

Interest received 732 1 733

Subsidies received 32 831 32 831

Proceeds from forward transactions realized 2 130 2 130


equipment ( 64 732) ( 1) ( 64 733)

Purchase of shares in subsidiaries ( 690) ( 690)

Loans granted ( 154) ( 154)




Loans and borrowings received 83 417 83 417


Expenditures relating to executed IRS ( 46) ( 46)


Interest paid ( 4 660) ( 73) ( 4 733)

Net cash from financing activities 101 584 ( 73) 101 511

Net increase/(decrease) in cash and cash equivalents 170 598 8 170 606


including:

173 362

8 173 370



and cash equivalents 2 764 2 764


Restated consolidated cash flow statement for the 3 months ended 31 March 2014


27

Q1 2013

period from

2013-01-01 to

2013-03-31

published

Adjustment

Q1 2013 period

from 2013-01-01

to 2013-03-31

restated


Adjustments:


Foreign exchange (gains)/ losses 9 448 156 9 604

(Gains)/ losses on disposal of fixed assets 13 13

Interest 429 429


equity method ( 7 144) 7 144 -


Change in receivables ( 193 754) 12 190 ( 181 564)

Change in inventories ( 97 243) ( 3 024) ( 100 267)

Change in trade and other payables 40 079 8 586 48 665

Cash flows generated from operating activities ( 53 717) 28 256 ( 25 461)

Tax paid ( 24 005) ( 75) ( 24 080)

Net cash flows from operating activities ( 77 722) 28 181 ( 49 541)



equipment 268 268

Repayments of loans granted 3 723 ( 3 723) 0

Interest received 2 843 2 843


equipment ( 49 117) ( 737) ( 49 854)




0



Interest paid ( 2 208) ( 170) ( 2 378)

Net cash from financing activities 17 897 ( 170) 17 727

Net increase/(decrease) in cash and cash equivalents ( 102 108) 2 ( 102 106)


including:

( 101 397)

2 ( 101 395)



and cash equivalents 711 711


Restated consolidated cash flow statement for the 3 months ended 31 March 2013


28

SYNTHOS S.A.

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Documents

ADDITIONAL INFORMATION 01.07.2014 --- 30.09.2014 QUARTERLY REPORT · Functional currency and presentation currency ... presentation currency at the mid-exchange rate of the National