Current Report No.: 37/2019
Date of preparation: 09.09.2019
Abbreviated name of the Issuer: CIECH S.A.
Legal basis: Art. 17.1 of the MAR – inside information
Subject: Information on creating a write-down
Contents of the Report:
With reference to Current Report No. 32/2019 of 9 August 2019, CIECH S.A. (the “Company” or “Issuer”) herewith informs that after receiving today confirmation of the applied approach from the auditor of the Company – PricewaterhouseCoopers Polska spółka z ograniczoną odpowiedzialnością Audyt sp.k., the Management Board of the Company has decided to create a write-down in the amount of PLN 36,655,000 (the “Write-down”), in the consolidated financial statements of the CIECH Group for the first half of 2019, related to impairment of assets of CIECH Soda Romania S.A. based in Romania (the “Subsidiary”). The reason for creating the Write-down is the risk of cessation of supply of process steam by its sole supplier - S.C. CET Govora S.A. based in Romania in composition bankruptcy (“CET”). The decision to create the Write-down was taken after the analysis of the premises pointing to impairment of fixed assets in accordance with the provisions of IAS 36 Impairment of Assets (the “Analysis”).
The analysis was based on the following feasible action scenarios:
The implementation of Scenario 1 will result in the release of the Write-down. The implementation of Scenario 2 will result in a corresponding increase in the amount of the Write-down by PLN 36,655,000, and if applicable, by the amounts following the update of the assumptions and calculations adopted for the Analysis.
The Write-down will have no impact on the consolidated adj. EBITDA of the CIECH Group (calculated as EBITDA adjusted for extraordinary one-off events), consolidated financial flows and the separate financial statements of the Company. The value of the Write-down will affect the consolidated operating result, consolidated EBITDA and consolidated net result of the CIECH Group for the first half of 2019. The Write-down will be presented in the Extended Consolidated Report of the CIECH Group for 1H 2019 to be published on 10 September 2019.
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).
Signatures of the persons representing the Company:
Dawid Jakubowicz – President of the Management Board
Artur Osuchowski – Member of the Management Board