Orzeł Biały S.A. (“The Company”) announces that on 30.08.2018 the Management Board of the Company decided, by Resolution No 51/2018, to create and reverse receivables revaluation write-downs related to its subsidiary Orzeł Surowce sp. o.o.
Such allowances will have a significant positive impact on the operating result in the Company’s financial statements for the first half of 2018, to the estimated amount of PLN 6.5 million, and a negative impact on the operating result in the consolidated financial statements for the first half of 2018, to the estimated amount PLN 0.5 million. The above includes:
• the reversal of the receivables revaluation write-down on account of the loan granted to Orzeł Surowce sp. o.o. in the amount of PLN 7 million, due to the setting off of the receivables. The estimated value of the reversed write-off will have a positive effect on the separate operating result in the Company’s financial statements for the first half of 2018.
• the reversal of the receivables revaluation write-down on account of the interest payable on the granted loan for Orzeł Surowce sp. o.o. in the amount of PLN 0.5 million, due to the setting off of receivables. The estimated value of the reversed write-off will have a positive effect on the separate operating result in the Company’s financial statements for the first half of 2018 and the consolidated operating result in the consolidated financial statements of the Company for the first half of 2018.
• the reversal of a part of the receivables revaluation write-down on account of the repayment of the loan of the subsidiary Orzeł Surowce Sp. z o.o. by Orzeł Biały S.A. (by entering into the rights of the paid-off creditor) in the amount of PLN 0.7 million, due to the setting off of receivables. The estimated value of the reversed write-off will have a positive effect on the separate operating result in the Company’s financial statements for the first half of 2018 and the consolidated operating result in the consolidated financial statements for the first half of 2018.
• the creation of a receivables revaluation write-down for receivables from Orzeł Surowce Sp. z o.o. resulting from the assignment of receivables from its contractors, in the amount of PLN 1.7 million, the recovery of which is, in The Issuer’s opinion, unlikely. The estimated value of the write-off will negatively affect the separate operating result in the Company’s financial statements for the first half of 2018 and the consolidated operating result in the consolidated financial statements of the Company for the first half of 2018.
The reversals of the above write-offs are a consequence of the receipt by the Company of the notified decision by the District Court in Katowice, 19th Department Companies Appeals to turn down the insolvency application of subsidiary Orzeł Surowce Sp. z o.o., which The Issuer notified in the Current Report No 19/2018 dated 13.08.2018 and, therefore, recovered control by The issuer over the said subsidiary and its affiliates.
The Issuer reserves that the interim abridged financial statement of the Company for 1H2018 is at the moment subject to the review by a statutory auditor and, therefore, above-mentioned amounts are not final and may be subject to change.
Legal basis: Art. 17, Act 1 MAR
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