Current Report No.: 9/2019

Intention to make collective redundancies in a subsidiary

Current Report No.: 9/2019

Date of preparation:

Abbreviated name of the Issuer: CIECH S.A.

Subject: Intention to make collective redundancies in a subsidiary

Legal basis: Art. 17.1 of the MAR – inside information

Text of the Report:

The Management Board of CIECH S.A. with its registered office in Warsaw (the "Issuer" or "Company") informs that on 20 March 2019, a subsidiary of the Issuer – CIECH Soda Romania S.A. (the “Subsidiary”) made a decision to initiate the procedure of collective redundancies in the Subsidiary.

The reason for the planned collective redundancies is the need to restructure fixed costs by reducing the level and the costs of employment in the Subsidiary. This decision is a result of the increase in prices of process steam as of 1 January 2019, and the risk arising from the limitation of steam supply by about 20%, as compared to the current status, in the period from 15 May 2019 until the beginning of the next heating season, as announced by the sole supplier of process steam - S.C. CET Govora S.A. ("CET"). The limitation of steam supply may result in the reduction of soda production at a comparable level.

As part of collective redundancies, the Subsidiary intends to dismiss up to 95 employees, which represents 16,1% of the plant team, starting from 15 May 2019.

The Subsidiary will notify today the company's trade union organisation operating in the Subsidiary and the relevant Romanian authorities – the Employment Office and the State Labour Inspection Service about the intention and causes of collective redundancies.

At the same time, in reference to Current Report No. 37/2018 of 28 December 2018, the Issuer informs that negotiations are underway to determine the price formula for the supply by CET to the Subsidiary of the process steam in 2019-2026.

Legal basis: Article 17.1 of the Regulation of the European Parliament and of the Council (EU) No. 596/2014 of 16 April 2014 on Market Abuse (the Market Abuse Regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (Official Journal of the European Union L No. 173, p. 1) (the “MAR”).

Signatures of the Company’s representatives:

Dawid Jakubowicz – President of the Management Board 

Artur Osuchowski – Member of the Management Board

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