KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT
ANNUAL FINANCIAL STATEMENTS
31 December 2023
Financial statements in English are translation from the original in Bulgarian. This version of the financial statements is a
translation from the original, which was prepared in Bulgarian. All possible care has been taken to ensure that the translation
is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the
original language version of the report takes precedence over this translation.
ANNUAL ACTIVITY REPORT
ANNUAL FINANCIAL STATEMENTS
31 December 2023
Financial statements in English are translation from the original in Bulgarian. This version of the financial statements is a
translation from the original, which was prepared in Bulgarian. All possible care has been taken to ensure that the translation
is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the
original language version of the report takes precedence over this translation.
KORADO-BULGARIA AD
GENERAL INFORMATION
i
MANAGEMENT BOARD
Jiri Reznicek – Chairman of MB and Executive Director
Silviya Stefanova
Jana Havlova
SUPERVISORY BOARD
Tomas Kollert – chairman of SB
Eva Voborova
Ivan Lyaskov
Evelina Miltenova
AUDIT COMMITTEE
Sneznanka Kaloyanova
Marketa Strjinkova
Irena Mihaylova
LEGAL CONSULTANTS
Ivan Asenov Lyaskov
Konechna and Zaha Legal Firm
REGISTERED AND MANAGEMENT ADDRESS
Town of Strazhitsa, 5150
28 Gladstone Street
REGISTRATION NUMBER
UIC 814190902
BANKERS
UBB
DSK Bank
AUDITOR
Deloitte Audit OOD
Balkan Business Centre
4, M. Tenev str.
Sofia, 1784
GENERAL INFORMATION
i
MANAGEMENT BOARD
Jiri Reznicek – Chairman of MB and Executive Director
Silviya Stefanova
Jana Havlova
SUPERVISORY BOARD
Tomas Kollert – chairman of SB
Eva Voborova
Ivan Lyaskov
Evelina Miltenova
AUDIT COMMITTEE
Sneznanka Kaloyanova
Marketa Strjinkova
Irena Mihaylova
LEGAL CONSULTANTS
Ivan Asenov Lyaskov
Konechna and Zaha Legal Firm
REGISTERED AND MANAGEMENT ADDRESS
Town of Strazhitsa, 5150
28 Gladstone Street
REGISTRATION NUMBER
UIC 814190902
BANKERS
UBB
DSK Bank
AUDITOR
Deloitte Audit OOD
Balkan Business Centre
4, M. Tenev str.
Sofia, 1784
KORADO-BULGARIA AD
TABLE OF CONTENTS
31 December 2023
ii
Contents Page
Annual activity report ............................................................................... iii-xxii
Corporate governance statement ............................................................... xxiii-xxxii
Remuneration report ................................................................................. xxxiii-xl
Statement of comprehensive income......................................................... 1
Statement of financial position.................................................................. 2
Statement of changes in equity ................................................................. 3
Statement of cash flows ............................................................................ 4
Notes to the financial statements ............................................................... 5 - 34
Independent Auditor’s report
Declaration under art. 100m, para 4, p. 3 of the POSA
TABLE OF CONTENTS
31 December 2023
ii
Contents Page
Annual activity report ............................................................................... iii-xxii
Corporate governance statement ............................................................... xxiii-xxxii
Remuneration report ................................................................................. xxxiii-xl
Statement of comprehensive income......................................................... 1
Statement of financial position.................................................................. 2
Statement of changes in equity ................................................................. 3
Statement of cash flows ............................................................................ 4
Notes to the financial statements ............................................................... 5 - 34
Independent Auditor’s report
Declaration under art. 100m, para 4, p. 3 of the POSA
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT
31 December 2023
iii
Dear Shareholders,
Even in 2023, like other manufacturers, we were struggling with a complex economic and geopolitical situation,
influenced especially by the military conflict in Ukraine. This resulted in year-on-year significant decrease in sales.
The prices of inputs have increased due to the lack of some materials and at the same time there has also been a
significant increase in energy prices, while the further development of input prices as well as supply and demand
are very difficult to predict.
As a Chairman of the Management Board of KORADO- Bulgaria AD (“The
Company”), I am pleased to announce that despite these limiting factors, smooth
operation was ensured in the Company, KORADO-Bulgaria AD ended 2023 with
a profit after taxation in the amount of BGN 3,569 thousand.
We are glad that despite the problems, the Company managed to achieve a positive
economic result.
We optimized our costs as much as possible and sought favourable prices for raw
materials for our production.
I would like to thank the entire management team of the Company, all employees
and workers who with their energy and high professionalism made our Company reliable for our partners and
made it possible to meet the expectations of our shareholders by fulfilling another successful year.
ENG. JIRI REZNICEK
Chairman of MB and Executive Director of
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT
31 December 2023
iii
Dear Shareholders,
Even in 2023, like other manufacturers, we were struggling with a complex economic and geopolitical situation,
influenced especially by the military conflict in Ukraine. This resulted in year-on-year significant decrease in sales.
The prices of inputs have increased due to the lack of some materials and at the same time there has also been a
significant increase in energy prices, while the further development of input prices as well as supply and demand
are very difficult to predict.
As a Chairman of the Management Board of KORADO- Bulgaria AD (“The
Company”), I am pleased to announce that despite these limiting factors, smooth
operation was ensured in the Company, KORADO-Bulgaria AD ended 2023 with
a profit after taxation in the amount of BGN 3,569 thousand.
We are glad that despite the problems, the Company managed to achieve a positive
economic result.
We optimized our costs as much as possible and sought favourable prices for raw
materials for our production.
I would like to thank the entire management team of the Company, all employees
and workers who with their energy and high professionalism made our Company reliable for our partners and
made it possible to meet the expectations of our shareholders by fulfilling another successful year.
ENG. JIRI REZNICEK
Chairman of MB and Executive Director of
KORADO-BULGARIA AD
KORADO-BULGARIA AD
INTERIM ACTIVITY REPORT
For the period ended 31 December 2023
iv
Management of KORADO- Bulgaria AD (“The Company”) presents the annual activity report and annual financial
statements as of 31 December 2023 prepared in accordance with International Financial Reporting Standards
(IFRS) as adopted for use in the European Union.
THIS MANAGEMENT REPORT HAS BEEN PREPARED IN ACCORDANCE WITH THE
PROVISIONS OF ART. 39 AND THE FOLLOWING OF THE ACCOUNTANCY ACT, ART. 100m,
PARA 7 OF THE LAW ON THE PUBLIC OFFERING OF SECURITIESACT AND ANNEXES 2 AND 3
OF ORDINANCE No. 2 OF 09.11.2021 ON INITIAL AND SUBSEQUENT DISCLOSURE OF
INFORMATION IN PUBLIC OFFERING OF SECURITIES AND ADMISSION OF SECURITIES TO
TRADING ON A REGULATED MARKET
DESCRIPTION OF THE ACTIVITY
KORADO-Bulgaria AD is registered with the Commercial Register at the Registry Agency under Unified
Identification Code (UIC) 814190902, incorporated and domiciled at its registered address in the Republic of
Bulgaria, VelikoTarnovo Region, Strazhitsa Municipality 5150, Strazhitsa town, 28 Gladstone Street.
The main scope of activity of the Company includes: manufacture and sale of heating equipment, domestic and
foreign trade in all their varieties, domestic and international transport, representation and agency. The Company
may perform also any other types of activities not prohibited by the laws of the Republic of Bulgaria.
The Company has no branches registered in the country and abroad.
Since 1994, the Company has been manufacturing primarily steel water heating panel radiators. The traditional
brand KORADO is perceived as a good product of European quality.
In 2023 the Company sells mostly to the European market, with the biggest share of sales being directed to
KORADO a.s. Czech Republic ( the „parent company” ).
The main suppliers of materials to the Company in 2023 were: Borcelik Turkey, Balkan Steel Engineering Sofia,
Liberti Galati Romania, Huss Ltd. Lom, Berg Metal Turkey, Comital Turkey, Profsan Turkey, Frei Lacke
Germany
The Company does not depend on its suppliers as it is able to choose among numerous companies according to
the prices offered, quality and method payment.
RESEARCH AND DEVELOPMENT ACTIVITIES
In the area of research and development activity, the most important part is the continuing fruitful collaboration
with the parent company. The project completed, directed towards reducing the costs of maintenance and
improving the production efficiency and quality and satisfying the customer’s requirements towards the products
manufactured, is a good example of that collaboration.
The project aiming at replacing materials supplied by the parent the Company with Bulgarian supplies continued.
Successes and positive results had been achieved in this area.
ANALYSIS OF THE OPERATING RESULTS
Production
As of 31.12.2023, the Company manufactured 252,424 water heating panel radiators. The Holding’s management
implements an appropriate marketing strategy aiming at preserving the share on the existing markets and keeping
people in jobs.
The radiators manufactured in 2023, as also in the previous years of 2021 and 2022, are shown in the table and
graph below:
Year I Quarter II Quarter III Quarter IV Quarter Total
2021 113 347 130 980 138 546 97 092 479 965
2022 118 053 94 194 81 915 49 209 343 371
2023 49 797 63 155 72 258 67 244 252 454
INTERIM ACTIVITY REPORT
For the period ended 31 December 2023
iv
Management of KORADO- Bulgaria AD (“The Company”) presents the annual activity report and annual financial
statements as of 31 December 2023 prepared in accordance with International Financial Reporting Standards
(IFRS) as adopted for use in the European Union.
THIS MANAGEMENT REPORT HAS BEEN PREPARED IN ACCORDANCE WITH THE
PROVISIONS OF ART. 39 AND THE FOLLOWING OF THE ACCOUNTANCY ACT, ART. 100m,
PARA 7 OF THE LAW ON THE PUBLIC OFFERING OF SECURITIESACT AND ANNEXES 2 AND 3
OF ORDINANCE No. 2 OF 09.11.2021 ON INITIAL AND SUBSEQUENT DISCLOSURE OF
INFORMATION IN PUBLIC OFFERING OF SECURITIES AND ADMISSION OF SECURITIES TO
TRADING ON A REGULATED MARKET
DESCRIPTION OF THE ACTIVITY
KORADO-Bulgaria AD is registered with the Commercial Register at the Registry Agency under Unified
Identification Code (UIC) 814190902, incorporated and domiciled at its registered address in the Republic of
Bulgaria, VelikoTarnovo Region, Strazhitsa Municipality 5150, Strazhitsa town, 28 Gladstone Street.
The main scope of activity of the Company includes: manufacture and sale of heating equipment, domestic and
foreign trade in all their varieties, domestic and international transport, representation and agency. The Company
may perform also any other types of activities not prohibited by the laws of the Republic of Bulgaria.
The Company has no branches registered in the country and abroad.
Since 1994, the Company has been manufacturing primarily steel water heating panel radiators. The traditional
brand KORADO is perceived as a good product of European quality.
In 2023 the Company sells mostly to the European market, with the biggest share of sales being directed to
KORADO a.s. Czech Republic ( the „parent company” ).
The main suppliers of materials to the Company in 2023 were: Borcelik Turkey, Balkan Steel Engineering Sofia,
Liberti Galati Romania, Huss Ltd. Lom, Berg Metal Turkey, Comital Turkey, Profsan Turkey, Frei Lacke
Germany
The Company does not depend on its suppliers as it is able to choose among numerous companies according to
the prices offered, quality and method payment.
RESEARCH AND DEVELOPMENT ACTIVITIES
In the area of research and development activity, the most important part is the continuing fruitful collaboration
with the parent company. The project completed, directed towards reducing the costs of maintenance and
improving the production efficiency and quality and satisfying the customer’s requirements towards the products
manufactured, is a good example of that collaboration.
The project aiming at replacing materials supplied by the parent the Company with Bulgarian supplies continued.
Successes and positive results had been achieved in this area.
ANALYSIS OF THE OPERATING RESULTS
Production
As of 31.12.2023, the Company manufactured 252,424 water heating panel radiators. The Holding’s management
implements an appropriate marketing strategy aiming at preserving the share on the existing markets and keeping
people in jobs.
The radiators manufactured in 2023, as also in the previous years of 2021 and 2022, are shown in the table and
graph below:
Year I Quarter II Quarter III Quarter IV Quarter Total
2021 113 347 130 980 138 546 97 092 479 965
2022 118 053 94 194 81 915 49 209 343 371
2023 49 797 63 155 72 258 67 244 252 454
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
v
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
Production (continued)
As of 31.12.2023 Company manufactured 95,951 tubular heating units. The tubular radiators manufactured during
2023, as also in the previous years of 2021 and 2022, are shown in the table and graph below:
I Quarter II Quarter III Quarter IV Quarter Total
2021 27 290 35 610 33 980 17 033 113 913
2022 26 918 24 550 31 283 19 536 102 287
2023 26 526 22 660 24 639 22 126 95 951
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
I Quarter II Quarter III Quarter IV Quarter
2021
2022
2023
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
I Quarter II Quarter III Quarter IV Quarter
2021
2022
2023
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
v
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
Production (continued)
As of 31.12.2023 Company manufactured 95,951 tubular heating units. The tubular radiators manufactured during
2023, as also in the previous years of 2021 and 2022, are shown in the table and graph below:
I Quarter II Quarter III Quarter IV Quarter Total
2021 27 290 35 610 33 980 17 033 113 913
2022 26 918 24 550 31 283 19 536 102 287
2023 26 526 22 660 24 639 22 126 95 951
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
I Quarter II Quarter III Quarter IV Quarter
2021
2022
2023
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
I Quarter II Quarter III Quarter IV Quarter
2021
2022
2023
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
Sales
As of 31 December 2023, the major trading partners of the Company are KORADO a.s. and companies in the
European market.
In 2023, the sales of KORADO-Bulgaria AD amount to 354,301 incl. panel radiators, tubular radiators and design
radiators.
The sales in the territory of the country amount to 3,616 which forms a minimum share of total sales of 1%.
To EU partners there have been sold 337,761 panel radiators and tubular radiators, and to countries outside the
EU 12,924 units. Compared to the same period of the previous year, there is a stabilization in the volume of
products sold to countries outside the EU with an increase of 13%, and a 22% decrease in sales to countries in the
European Union. Sales in Bulgaria marked a 21% decrease compared to the previous period - January - December
2022.
The sales of heating units in 2023 and the previous years of 2021 and 2022 are shown in the following table and
graph:
Period Units EU Bulgaria Other Total
I – XII. 2021 number 543 425 10 144 47 288 600 857
I – XII. 2022 number 433 621 4 594 11 486 449 701
I – XII. 2023 number 337 761 3 616 12 924 354 301
The following table illustrates the number of tubular and design heating units sold in 2023 and previous 2021 and
2022:
Period Units EU Bulgaria Total
I – XII. 2021 number 114 285 2 414 116 699
I – XII. 2022 number 103 011 1 296 104 307
I – XII. 2023 number 96 269 1 094 97 363
0
100 000
200 000
300 000
400 000
500 000
600 000
700 000
І - XII. 2021 І - XII. 2022 І - XII. 2023
EU
Bulgaria
Other
Total
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
Sales
As of 31 December 2023, the major trading partners of the Company are KORADO a.s. and companies in the
European market.
In 2023, the sales of KORADO-Bulgaria AD amount to 354,301 incl. panel radiators, tubular radiators and design
radiators.
The sales in the territory of the country amount to 3,616 which forms a minimum share of total sales of 1%.
To EU partners there have been sold 337,761 panel radiators and tubular radiators, and to countries outside the
EU 12,924 units. Compared to the same period of the previous year, there is a stabilization in the volume of
products sold to countries outside the EU with an increase of 13%, and a 22% decrease in sales to countries in the
European Union. Sales in Bulgaria marked a 21% decrease compared to the previous period - January - December
2022.
The sales of heating units in 2023 and the previous years of 2021 and 2022 are shown in the following table and
graph:
Period Units EU Bulgaria Other Total
I – XII. 2021 number 543 425 10 144 47 288 600 857
I – XII. 2022 number 433 621 4 594 11 486 449 701
I – XII. 2023 number 337 761 3 616 12 924 354 301
The following table illustrates the number of tubular and design heating units sold in 2023 and previous 2021 and
2022:
Period Units EU Bulgaria Total
I – XII. 2021 number 114 285 2 414 116 699
I – XII. 2022 number 103 011 1 296 104 307
I – XII. 2023 number 96 269 1 094 97 363
0
100 000
200 000
300 000
400 000
500 000
600 000
700 000
І - XII. 2021 І - XII. 2022 І - XII. 2023
EU
Bulgaria
Other
Total
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
The trade relationships between KORADO-Bulgaria AD and the companies from the economic group are on equal
trade footing and no preferences or reliefs are provided on the basis that they are related parties.
Operating expenses
The structure of operating expenses of the Company was not changed considerably in 2023 compared to the
previous year.
Comprehensive income
The Company’s Comprehensive income for 202 3 is a profit after taxes amounting to BGN 3,569 thousand (2022:
BGN 4,382 thousand).
The Comprehensive income for the last three years is shown in the following table:
Comprehensive income (BGN’000)
2021 4,759
2022 4,382
2023 3,569
SHARE CAPITAL
Shareholders Share Number of shares Nominal value (BGN)
KORADOa.s., Czech Republic 82.15 % 10 817 923 10 817 923
Legal entities 15,94 % 2 098 741 2 098 741
Individuals 1.91 % 251 950 251 950
TOTAL 100 % 13 168 614 13 168 614
At 31 December 2023 the Company held no shares in the capital of other companies.
0
20 000
40 000
60 000
80 000
100 000
120 000
I – XII. 2021 I – XII. 2022 I – XII. 2023
EU
Bulgaria
Total
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
ANALYSIS OF THE OPERATING RESULTS (CONTINUED)
The trade relationships between KORADO-Bulgaria AD and the companies from the economic group are on equal
trade footing and no preferences or reliefs are provided on the basis that they are related parties.
Operating expenses
The structure of operating expenses of the Company was not changed considerably in 2023 compared to the
previous year.
Comprehensive income
The Company’s Comprehensive income for 202 3 is a profit after taxes amounting to BGN 3,569 thousand (2022:
BGN 4,382 thousand).
The Comprehensive income for the last three years is shown in the following table:
Comprehensive income (BGN’000)
2021 4,759
2022 4,382
2023 3,569
SHARE CAPITAL
Shareholders Share Number of shares Nominal value (BGN)
KORADOa.s., Czech Republic 82.15 % 10 817 923 10 817 923
Legal entities 15,94 % 2 098 741 2 098 741
Individuals 1.91 % 251 950 251 950
TOTAL 100 % 13 168 614 13 168 614
At 31 December 2023 the Company held no shares in the capital of other companies.
0
20 000
40 000
60 000
80 000
100 000
120 000
I – XII. 2021 I – XII. 2022 I – XII. 2023
EU
Bulgaria
Total
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
CERTIFICATION
The Company has implemented a Quality Management System according to ISO 9001 system standard. The
system guarantees a much better quality through the continuous improvement of process management. In April
2018 the Company shifted to ISO 9001:2015.
During the supervisory audit in April 2023, carried out by the certification organization BUREAU VERITAS
CERTIFICATION, it was established that the QMS was built in accordance with the requirements of the standards
and the normative acts applicable to the Company's activities.
ENVIRONMENTAL PROTECTION
The Company has assessed the importance of environmental aspects and set specific and measurable objectives
related to the environmental protection, having defined activities to achieve them. The goals set include measures
and tasks as well as deadlines and those responsible for their implementation. The Company monitors the
environmental parameters in accordance with the Monitoring Plan. Environmental monitoring covers all structural
units and processes. The Company has signed contracts with companies that possess permits from the Ministry of
the Environment and Water for waste operating activities and to which KORADO Bulgaria AD promptly delivers
its waste.
Management of hazardous waste - emulsions and other solutions not containing halogen elements, oils, etc. is at
the required level: the constructed sites for the temporary storage of hazardous waste meet the regulatory
requirements and are maintained in good condition. The release of emissions into the air is monitored in order to
comply with the current regulations.
Annual monitoring of the released emissions is carried out by an accredited laboratory. Based on their results, a
Solvents Management Plan /SMP/ is developed and approved by RIEW - Veliko Tarnovo. The measures and
actions set out in the Volatile Organic Emissions Reduction Program are followed.
The Company is committed on environmentally responsible behaviour in all aspects of its operations. Its activity
complies with the national environmental policy following the principles of the EU Directives and any activities
relating thereto, which underlie the effective Bulgarian law in the field of environment.:
✓ Since 2013 the Company has been using natural gas in the technological processes and for heating.
✓ Waste waters – periodic measurements of waste waters.
✓ A contract was signed in 2017 with BULECOPACK AD, an organization that deals with the separate collection
and recycling of packaging waste.
The Management environmental management policy guarantees the Company’s commitment to permanently
improve the environmental condition by reducing and preventing environmental pollution.
HUMAN RESOURCES
The main human resource processes in 2023 were directed towards improving the qualification of the Company
staff as the major resource to achieve the stated objectives and to improve effectiveness.
The average number of staff employed by KORADO-Bulgaria AD as at 31 December 2023 is 171, including 39
women.
✓ Employees with higher education degree - 31, including 15 women;
✓ Employees with secondary education degree – 118, including 23 women.
✓ Employees with elementary education degree – 19, including 1 women;
✓ Management positions occupied by women – 3.
To reach a high level of development of professional skills and qualification of workers and employees,
professional training, participation in professional training courses and seminars on various topics were organized
in 2023.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
CERTIFICATION
The Company has implemented a Quality Management System according to ISO 9001 system standard. The
system guarantees a much better quality through the continuous improvement of process management. In April
2018 the Company shifted to ISO 9001:2015.
During the supervisory audit in April 2023, carried out by the certification organization BUREAU VERITAS
CERTIFICATION, it was established that the QMS was built in accordance with the requirements of the standards
and the normative acts applicable to the Company's activities.
ENVIRONMENTAL PROTECTION
The Company has assessed the importance of environmental aspects and set specific and measurable objectives
related to the environmental protection, having defined activities to achieve them. The goals set include measures
and tasks as well as deadlines and those responsible for their implementation. The Company monitors the
environmental parameters in accordance with the Monitoring Plan. Environmental monitoring covers all structural
units and processes. The Company has signed contracts with companies that possess permits from the Ministry of
the Environment and Water for waste operating activities and to which KORADO Bulgaria AD promptly delivers
its waste.
Management of hazardous waste - emulsions and other solutions not containing halogen elements, oils, etc. is at
the required level: the constructed sites for the temporary storage of hazardous waste meet the regulatory
requirements and are maintained in good condition. The release of emissions into the air is monitored in order to
comply with the current regulations.
Annual monitoring of the released emissions is carried out by an accredited laboratory. Based on their results, a
Solvents Management Plan /SMP/ is developed and approved by RIEW - Veliko Tarnovo. The measures and
actions set out in the Volatile Organic Emissions Reduction Program are followed.
The Company is committed on environmentally responsible behaviour in all aspects of its operations. Its activity
complies with the national environmental policy following the principles of the EU Directives and any activities
relating thereto, which underlie the effective Bulgarian law in the field of environment.:
✓ Since 2013 the Company has been using natural gas in the technological processes and for heating.
✓ Waste waters – periodic measurements of waste waters.
✓ A contract was signed in 2017 with BULECOPACK AD, an organization that deals with the separate collection
and recycling of packaging waste.
The Management environmental management policy guarantees the Company’s commitment to permanently
improve the environmental condition by reducing and preventing environmental pollution.
HUMAN RESOURCES
The main human resource processes in 2023 were directed towards improving the qualification of the Company
staff as the major resource to achieve the stated objectives and to improve effectiveness.
The average number of staff employed by KORADO-Bulgaria AD as at 31 December 2023 is 171, including 39
women.
✓ Employees with higher education degree - 31, including 15 women;
✓ Employees with secondary education degree – 118, including 23 women.
✓ Employees with elementary education degree – 19, including 1 women;
✓ Management positions occupied by women – 3.
To reach a high level of development of professional skills and qualification of workers and employees,
professional training, participation in professional training courses and seminars on various topics were organized
in 2023.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
HUMAN RESOURCES (CONTINUED)
The commitment of workers and employees to follow steadily the principles of integrity and morality in their
relationships and to precisely comply with the laws of the countries in which we operate is one of the basic
principles underlying the Code of Ethics of KORADO-Bulgaria AD. It is mandatory to follow these principles in
the relationships with clients and business partners, as also in personal and business relationships.
The Company’s management expects and requires all employees at all levels to comply unconditionally with the
above principles and requirements. Any non-compliance would jeopardize the confidence of our clients, suppliers,
employees and other counterparties, and would harm and seriously threaten not only our competitiveness and
image, but also our upward development.
KORADO-Bulgaria AD is committed to provide its employees with safe and secure work environment. Safety is
particularly critical in our production workshops that are subject to strict work safety regulations. Safety rules
apply to each workplace. We comply with all provisions, including with our own policies, which often introduce
requirements not covered by law. All employees and other persons working in our premises are well informed
about the safety requirements relating to their work. The lack of labour incidents during the last year supports this
fact.
In all its business initiatives, KORADO-Bulgaria AD is attempting to be fair and correct company. We compete
actively, but do it fairly and by observing all applicable competition laws and equality in the market. We adhere
strictly to the laws for the protection of global markets from unfair competition.
KORADO-Bulgaria AD will pursue the highest standards in its activity with the aim to maintain and develop in
the long run its positions won in the competitive environment, in which it has chosen to operate. We are committed
to the sustainable development of our society. This requires reaching a balance between short-term and long-term
interests and reporting of all economic, ecological and social concerns in taking business solutions.
KORADO-Bulgaria AD acknowledges that its efforts to maintain confidence and security of shareholders,
employees, clients and all other stakeholders, as well as of the communities where it operates are of the utmost
importance to ensuring the Company’s constant development and success.
FINANCIAL RATIOS
Liquidity
General liquidity = Current assets / Current liabilities = BGN 17,777 thousand / BGN 3,911 thousand = 4,55
Quick liquidity = (Current assets – Inventories) / Current liabilities = (BGN 17,777 thousand –
BGN 6,967 thousand) / 3,911 thousand = 2,76
Absolute liquidity = Cash and cash equivalents / Current liabilities = BGN 1,296 thousand / BGN 3,911 thousand
= 0,33
Net working capital = Current assets – Current liabilities = BGN 17,777 thousand – BGN 3,911 thousand =
BGN 13,866 thousand
Profitability
Sales profit margin = Gross profit / Sales revenue = BGN 3,972 thousand / BGN 39,274 thousand = 10,11 %
Return on assets before taxes = Gross profit / Total assets = BGN 3,972 thousand / BGN 31,987 thousand =
12,42 %
Return on equity = Comprehensive income / Equity = BGN 3,569 thousand / BGN 25,061 thousand = 14,24 %
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
HUMAN RESOURCES (CONTINUED)
The commitment of workers and employees to follow steadily the principles of integrity and morality in their
relationships and to precisely comply with the laws of the countries in which we operate is one of the basic
principles underlying the Code of Ethics of KORADO-Bulgaria AD. It is mandatory to follow these principles in
the relationships with clients and business partners, as also in personal and business relationships.
The Company’s management expects and requires all employees at all levels to comply unconditionally with the
above principles and requirements. Any non-compliance would jeopardize the confidence of our clients, suppliers,
employees and other counterparties, and would harm and seriously threaten not only our competitiveness and
image, but also our upward development.
KORADO-Bulgaria AD is committed to provide its employees with safe and secure work environment. Safety is
particularly critical in our production workshops that are subject to strict work safety regulations. Safety rules
apply to each workplace. We comply with all provisions, including with our own policies, which often introduce
requirements not covered by law. All employees and other persons working in our premises are well informed
about the safety requirements relating to their work. The lack of labour incidents during the last year supports this
fact.
In all its business initiatives, KORADO-Bulgaria AD is attempting to be fair and correct company. We compete
actively, but do it fairly and by observing all applicable competition laws and equality in the market. We adhere
strictly to the laws for the protection of global markets from unfair competition.
KORADO-Bulgaria AD will pursue the highest standards in its activity with the aim to maintain and develop in
the long run its positions won in the competitive environment, in which it has chosen to operate. We are committed
to the sustainable development of our society. This requires reaching a balance between short-term and long-term
interests and reporting of all economic, ecological and social concerns in taking business solutions.
KORADO-Bulgaria AD acknowledges that its efforts to maintain confidence and security of shareholders,
employees, clients and all other stakeholders, as well as of the communities where it operates are of the utmost
importance to ensuring the Company’s constant development and success.
FINANCIAL RATIOS
Liquidity
General liquidity = Current assets / Current liabilities = BGN 17,777 thousand / BGN 3,911 thousand = 4,55
Quick liquidity = (Current assets – Inventories) / Current liabilities = (BGN 17,777 thousand –
BGN 6,967 thousand) / 3,911 thousand = 2,76
Absolute liquidity = Cash and cash equivalents / Current liabilities = BGN 1,296 thousand / BGN 3,911 thousand
= 0,33
Net working capital = Current assets – Current liabilities = BGN 17,777 thousand – BGN 3,911 thousand =
BGN 13,866 thousand
Profitability
Sales profit margin = Gross profit / Sales revenue = BGN 3,972 thousand / BGN 39,274 thousand = 10,11 %
Return on assets before taxes = Gross profit / Total assets = BGN 3,972 thousand / BGN 31,987 thousand =
12,42 %
Return on equity = Comprehensive income / Equity = BGN 3,569 thousand / BGN 25,061 thousand = 14,24 %
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
FINANCIAL RATIOS (CONTINUED)
The amounts of the financial ratios for the last three years are shown in the following table:
CORPORATE GOVERNANCE
Pursuant to the effective Commercial Act of Bulgaria, at 31 December 2023 KORADO-Bulgaria AD is a joint-
stock company with a two-tier management system: Supervisory Board and Management Board.
Members of the Supervisory Board at 31 December 2023:
1. Tomas Kollert – Chairman
2. Eva Voborova
3. Ivan Lyaskov
4. Evelina Miltenova
Members of the Management Board at 31 December 2023:
1. Jiri Reznicek – Chairman of MB
2. Silviya Stefanova
3. Jana Havlova
Jiri Reznicek is the Executive Director of the Company.
FINANCIAL RISK MANAGEMENT
The Company’s activities expose it to various financial risks, such as market risk (including currency risk, interest
rate risk, and other price risk), credit risk and liquidity risk. Management monitors the overall risk exposure and seeks
ways to eliminate any potential negative effects on the financial position of the Company, as disclosed in Note 19 to
the financial statements.
GOING CONCERN PRINCIPLE
Based on the analysis described in Note 1.1. Going concern principle, management has not identified material
uncertainty that the Company will be able to continue to exist as a going concern.
EVENTS AFTER THE END OF THE REPORTING PERIOD
No events have occurred after the reporting date, which require adjustments and/or disclosures in the Company’s
financial statements.
Ratio 2021 2022 2023
Liquidity
General liquidity 2,40 5,67 4,55
Quick liquidity 0,82 1,72 2,76
Absolute liquidity 0,13 0,15 0,33
Net working capital 12,246 14,958 13,866
Profitability
Sales profit margin 9,3% 8,8% 10,11%
Return on assets before taxes 15% 14,8% 12,42%
Return on equity 21,3% 19,1% 14,24%
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
FINANCIAL RATIOS (CONTINUED)
The amounts of the financial ratios for the last three years are shown in the following table:
CORPORATE GOVERNANCE
Pursuant to the effective Commercial Act of Bulgaria, at 31 December 2023 KORADO-Bulgaria AD is a joint-
stock company with a two-tier management system: Supervisory Board and Management Board.
Members of the Supervisory Board at 31 December 2023:
1. Tomas Kollert – Chairman
2. Eva Voborova
3. Ivan Lyaskov
4. Evelina Miltenova
Members of the Management Board at 31 December 2023:
1. Jiri Reznicek – Chairman of MB
2. Silviya Stefanova
3. Jana Havlova
Jiri Reznicek is the Executive Director of the Company.
FINANCIAL RISK MANAGEMENT
The Company’s activities expose it to various financial risks, such as market risk (including currency risk, interest
rate risk, and other price risk), credit risk and liquidity risk. Management monitors the overall risk exposure and seeks
ways to eliminate any potential negative effects on the financial position of the Company, as disclosed in Note 19 to
the financial statements.
GOING CONCERN PRINCIPLE
Based on the analysis described in Note 1.1. Going concern principle, management has not identified material
uncertainty that the Company will be able to continue to exist as a going concern.
EVENTS AFTER THE END OF THE REPORTING PERIOD
No events have occurred after the reporting date, which require adjustments and/or disclosures in the Company’s
financial statements.
Ratio 2021 2022 2023
Liquidity
General liquidity 2,40 5,67 4,55
Quick liquidity 0,82 1,72 2,76
Absolute liquidity 0,13 0,15 0,33
Net working capital 12,246 14,958 13,866
Profitability
Sales profit margin 9,3% 8,8% 10,11%
Return on assets before taxes 15% 14,8% 12,42%
Return on equity 21,3% 19,1% 14,24%
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
1. National Corporate Governance Code
KORADO-Bulgaria AD implements its own long-term good corporate governance program. The program
envisages various initiatives in a number of key directions, the performance of which facilitates the achievement
of its priority objectives: independence and responsibility of corporate management, protection of the rights of
shareholders; ensuring equal treatment of all shareholders (including minority and foreign shareholders); ensuring
recognition of the rights of any persons concerned of the Company’s management and steady development and
encouraging cooperation with them; ensuring timely and precise disclosure of important information on the
financial performance, operating results, property and management of KORADO-Bulgaria AD, as required by
law; facilitating strategic management of KORADO-Bulgaria AD; efficient control over the activities of the
Management Board (MB) and Supervisory Board (SB), and their reporting to all stakeholders.
Having regard to the important role of modern corporate governance in promoting the sustainable development of
the national economy of the Republic of Bulgaria and being guided by their commitment to continue implementing
the internationally recognized good corporate governance standards, MB and SB of KORADO-Bulgaria AD have
decided that the Company shall carry out its activity in compliance with the principles and provisions of the
National Corporate Governance Code.
2. Implementation of the National Corporate Governance Code
Management of KORADO- Bulgaria AD implements the National Code of the basis of the principle “comply or
explain”. The observance of this principle is based on the recommendation of the European Commission on the
quality of the reporting in the area of corporate governance.
The main direction in fulfilling the commitments of the Code was bringing all in-house acts of the Company and
its overall activity in accordance with the constantly changing effective regulations.
All financial statements of the Company are prepared in accordance with International Financial Reporting
Standards (IFRS) as adopted by EU and the annual audit is carried out by an independent auditor to ensure the
unbiased and objective assessment of the method of preparation and presentation of these financial statements.
These financial statements are accompanied by detailed activity reports.
MB and SB manage the Company independently and responsibly, in line with the Company’s vision, goals,
strategies and the shareholders’ interests. They establish and monitor the strategic guidance for developing the
Company. MB and SB have established a risk management policy and supervise the development and operation
of an internal control and risk management system. MB and SB ensure compliance with statutory, regulatory and
contractual obligations of the Company, provide guidelines, approve and monitor the performance of the
Company’s business plan, significant transactions and activities provided for by in-house regulations. A financial
and information system of the Company has been developed and operates reliably.
SB has adopted an information disclosure and investor relations policy. Following the policy for more transparency
in its relationships with shareholders, investors and the public, KORADO-Bulgaria AD has announced the media
through which it discloses regulated information: X3-News platform of Service Financial Markets EOOD, owned
by Bulgarian Stock Exchange – Sofia AD.
The members of MB and SB base their actions on common principles of integrity and managerial and professional
competence, a basis of which is the adopted Code of Ethics. MB and SB report to the General Meeting of
Shareholders on their activities. The General Meeting of Shareholders appoints and discharges the members of SB
in compliance with the law and the Company’s Articles of Association, by observing the principles of continuity
and stability of the governing bodies’ activities. The members of SB are elected through a transparent procedure,
which ensures timely and sufficient information on the applicant’s personal and professional skills. Management
contracts comply with the requirements of the law, constituent acts and good professional and management
practice, and define the competences, rights and obligations of the members of SB and MB, criteria to apply in
determining their remuneration, their obligation to be loyal to the Company, as also the grounds for their dismissal.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xi
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
1. National Corporate Governance Code
KORADO-Bulgaria AD implements its own long-term good corporate governance program. The program
envisages various initiatives in a number of key directions, the performance of which facilitates the achievement
of its priority objectives: independence and responsibility of corporate management, protection of the rights of
shareholders; ensuring equal treatment of all shareholders (including minority and foreign shareholders); ensuring
recognition of the rights of any persons concerned of the Company’s management and steady development and
encouraging cooperation with them; ensuring timely and precise disclosure of important information on the
financial performance, operating results, property and management of KORADO-Bulgaria AD, as required by
law; facilitating strategic management of KORADO-Bulgaria AD; efficient control over the activities of the
Management Board (MB) and Supervisory Board (SB), and their reporting to all stakeholders.
Having regard to the important role of modern corporate governance in promoting the sustainable development of
the national economy of the Republic of Bulgaria and being guided by their commitment to continue implementing
the internationally recognized good corporate governance standards, MB and SB of KORADO-Bulgaria AD have
decided that the Company shall carry out its activity in compliance with the principles and provisions of the
National Corporate Governance Code.
2. Implementation of the National Corporate Governance Code
Management of KORADO- Bulgaria AD implements the National Code of the basis of the principle “comply or
explain”. The observance of this principle is based on the recommendation of the European Commission on the
quality of the reporting in the area of corporate governance.
The main direction in fulfilling the commitments of the Code was bringing all in-house acts of the Company and
its overall activity in accordance with the constantly changing effective regulations.
All financial statements of the Company are prepared in accordance with International Financial Reporting
Standards (IFRS) as adopted by EU and the annual audit is carried out by an independent auditor to ensure the
unbiased and objective assessment of the method of preparation and presentation of these financial statements.
These financial statements are accompanied by detailed activity reports.
MB and SB manage the Company independently and responsibly, in line with the Company’s vision, goals,
strategies and the shareholders’ interests. They establish and monitor the strategic guidance for developing the
Company. MB and SB have established a risk management policy and supervise the development and operation
of an internal control and risk management system. MB and SB ensure compliance with statutory, regulatory and
contractual obligations of the Company, provide guidelines, approve and monitor the performance of the
Company’s business plan, significant transactions and activities provided for by in-house regulations. A financial
and information system of the Company has been developed and operates reliably.
SB has adopted an information disclosure and investor relations policy. Following the policy for more transparency
in its relationships with shareholders, investors and the public, KORADO-Bulgaria AD has announced the media
through which it discloses regulated information: X3-News platform of Service Financial Markets EOOD, owned
by Bulgarian Stock Exchange – Sofia AD.
The members of MB and SB base their actions on common principles of integrity and managerial and professional
competence, a basis of which is the adopted Code of Ethics. MB and SB report to the General Meeting of
Shareholders on their activities. The General Meeting of Shareholders appoints and discharges the members of SB
in compliance with the law and the Company’s Articles of Association, by observing the principles of continuity
and stability of the governing bodies’ activities. The members of SB are elected through a transparent procedure,
which ensures timely and sufficient information on the applicant’s personal and professional skills. Management
contracts comply with the requirements of the law, constituent acts and good professional and management
practice, and define the competences, rights and obligations of the members of SB and MB, criteria to apply in
determining their remuneration, their obligation to be loyal to the Company, as also the grounds for their dismissal.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiii
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
The number of the members of the governing bodies is defined by the Company’s Articles of Association. The
composition of Boards is structured in a manner which ensures that their decisions concerning the Company’s
management will be professional, unbiased and independent. MB and SB have made an appropriate division of
tasks and duties among its members. The members of the governing bodies possess appropriate skills and
experience, and after being elected new members are introduced to the major legal and financial matters relating
to the Company’s operations. It is a constant practice to improve the competence and qualification of the members
of the governing bodies. Consistency in mandates to ensure the effective operation of the Company and compliance
with legal requirements.
The members of the governing bodies have the time required to fulfil their tasks and obligations. The rules of
procedure of MB and SB define the maximum number of the companies outside the portfolio of KORADO-
Bulgaria AD, in which the members may occupy governing positions. The amount and structure of remuneration
of the members of the governing bodies are determined by the General Meeting of Shareholders. They take into
account the obligations and contribution of each member, the likelihood of selecting and retaining qualified and
loyal members, the need to ensure consistency between the member’s interests and the long -term interests of the
Company. The members of MB and SB receive fixed remuneration.
The General Meeting of Shareholders adopted a Remuneration Policy applicable to the members of MB and SB,
with the objective to support the long-term business goals of the Company and to encourage behaviour that
facilitates the creation of value for the shareholders, at the same time ensuring competitive remuneration that is
sufficient to attract and retain directors possessing the skills necessary for the successful management and
development of the Company. Information on the remuneration of the members of the governing bodies is
disclosed in an annual report, a separate document to the annual financial statements of the Company. The
Remuneration Policy and the annual report are published on the Company’s website.
MB and SB of KORADO-Bulgaria AD have adopted procedures for the avoidance and disclosure of conflicts of
interest. These procedure put the members under the obligation to avoid any real or potential conflicts of interest,
and if necessary, to disclose immediately any conflicts of interest and to ensure access for the shareholders to
information about transactions among them and the Company or their related parties. On the other hand, any
conflict of interest within the Company shall be notified to the governing bodies.
Taking into account the specifics of the Company, the SB has judged that an Audit Committee should be
established. Simultaneously, following the amendments to the law, the Audit Committee was established by the
General Meeting of Shareholders and its composition and mandate were set. The Audit Committee operates on its
own operational rules and work schedule. Its activity is directed towards improving effectiveness of financial
reporting processes, internal control systems and risk management.
The Audit Committee, being guided by the established professional requirements, makes a substantiated proposal
to the General Meeting of Shareholders for the election of an external auditor. The Company has implemented an
internal control system, which guarantees the effective functioning of the reporting systems and disclosure of
information aimed at identifying the risks inherent to the activity of the Company and facilitating their efficient
management.
The corporate governance of KORADO-Bulgaria AD ensures equal treatment for all shareholders, including
minority and foreign shareholders, and protects their rights. All shareholders have the right to participate in the
General Meeting of Shareholders and to express their opinions. They are able to exercise their right to vote at the
General Meeting of Shareholders of the Company through representatives as well.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiii
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
The number of the members of the governing bodies is defined by the Company’s Articles of Association. The
composition of Boards is structured in a manner which ensures that their decisions concerning the Company’s
management will be professional, unbiased and independent. MB and SB have made an appropriate division of
tasks and duties among its members. The members of the governing bodies possess appropriate skills and
experience, and after being elected new members are introduced to the major legal and financial matters relating
to the Company’s operations. It is a constant practice to improve the competence and qualification of the members
of the governing bodies. Consistency in mandates to ensure the effective operation of the Company and compliance
with legal requirements.
The members of the governing bodies have the time required to fulfil their tasks and obligations. The rules of
procedure of MB and SB define the maximum number of the companies outside the portfolio of KORADO-
Bulgaria AD, in which the members may occupy governing positions. The amount and structure of remuneration
of the members of the governing bodies are determined by the General Meeting of Shareholders. They take into
account the obligations and contribution of each member, the likelihood of selecting and retaining qualified and
loyal members, the need to ensure consistency between the member’s interests and the long -term interests of the
Company. The members of MB and SB receive fixed remuneration.
The General Meeting of Shareholders adopted a Remuneration Policy applicable to the members of MB and SB,
with the objective to support the long-term business goals of the Company and to encourage behaviour that
facilitates the creation of value for the shareholders, at the same time ensuring competitive remuneration that is
sufficient to attract and retain directors possessing the skills necessary for the successful management and
development of the Company. Information on the remuneration of the members of the governing bodies is
disclosed in an annual report, a separate document to the annual financial statements of the Company. The
Remuneration Policy and the annual report are published on the Company’s website.
MB and SB of KORADO-Bulgaria AD have adopted procedures for the avoidance and disclosure of conflicts of
interest. These procedure put the members under the obligation to avoid any real or potential conflicts of interest,
and if necessary, to disclose immediately any conflicts of interest and to ensure access for the shareholders to
information about transactions among them and the Company or their related parties. On the other hand, any
conflict of interest within the Company shall be notified to the governing bodies.
Taking into account the specifics of the Company, the SB has judged that an Audit Committee should be
established. Simultaneously, following the amendments to the law, the Audit Committee was established by the
General Meeting of Shareholders and its composition and mandate were set. The Audit Committee operates on its
own operational rules and work schedule. Its activity is directed towards improving effectiveness of financial
reporting processes, internal control systems and risk management.
The Audit Committee, being guided by the established professional requirements, makes a substantiated proposal
to the General Meeting of Shareholders for the election of an external auditor. The Company has implemented an
internal control system, which guarantees the effective functioning of the reporting systems and disclosure of
information aimed at identifying the risks inherent to the activity of the Company and facilitating their efficient
management.
The corporate governance of KORADO-Bulgaria AD ensures equal treatment for all shareholders, including
minority and foreign shareholders, and protects their rights. All shareholders have the right to participate in the
General Meeting of Shareholders and to express their opinions. They are able to exercise their right to vote at the
General Meeting of Shareholders of the Company through representatives as well.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiii
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
Rules have been adopted for the organization and holding of regular and extraordinary General Meetings of
Shareholders, which guarantee equal treatment for all shareholders and the right of each shareholder to express
his/her opinion on the agenda topics. The procedures and order for convening a General Meeting of Shareholders
do not prevent or make the voting unnecessary more expensive. These procedures encourage the shareholders’
participation in the General Meeting of Shareholders, but do not envisage a possibility for remote presence through
technical devices as this would make the holding of the General Meeting more onerous. Rules on proxy voting
have been adopted. The wording of written materials on the agenda of the General Meeting of Shareholders are
specific and clear, and do not mislead the shareholders. All proposals on major corporate events are presented as
separate agenda items, including the proposal for profit distribution.
To improve the confidence of shareholders, investors and stakeholders in the Company’s management and
operations is one of the key tasks of corporate governance. With respect to that, the Company constantly reaffirms
its position of a stable institution.
In 2023 as well, the approval and implementation of various ways for disclosure of current information on the
Company’s financial and business performance and important corporate events, and their promotion, continued.
KORADO-Bulgaria AD has approved a policy and system for disclosure of information in compliance with the
legal requirements. It guarantees equality of the information addressees (shareholders, stakeholders, investment
society) and prevents abuses in the form of insider dealing.
The system for disclosure of information ensures complete, timely, true and understandable information, which
enables objective and informed decisions and valuations. The Company has implemented in-house rules for the
preparation of annual and interim reports, and disclosure procedure.
The Company maintains its website, which contains corporate information, information about the governing
bodies and shareholding structure of KORADO-Bulgaria AD. The investor section contains internal documents of
the Company, information about the shareholders’ rights and their participation in the General Meeting of
Shareholders, the financial statements for the last 10 years, information about the payment of dividends, as also
for personal data protection. This section also contains materials for the forthcoming General Meetings of
Shareholders of the Company, information on the decisions passed by the General Meeting of Shareholders.
Information about initiatives of the Company, for the auditors and the media that publish news about the holding
is publicly available.
The News section contains information on the periodical publications of the Company, forthcoming events and
important information concerning the Company’s activity. There is a procedure for payment of prior year’s
dividends to be followed by the shareholders.
The practice of sending timely responses to letters and inquiries of shareholders, including such received by email
and their recording in a register duly kept by the Investor relation Directors continues. There is a practice that,
irrespective of the nature of the question, the answer shall contain a detailed explanation of the rights of the
shareholders of the holding. The procedure for transfer of shares by way of inheritance is described in detail. Each
shareholder who, on various occasions, addresses the Company is thoroughly informed of his rights and provided
with information on various matters concerning the activity and current status of the Company, including for the
movement of share prices of KORADO-Bulgaria AD on the stock market.
The corporate governance of KORADO-Bulgaria AD ensures efficient relationships with all stakeholders,
identified by the Company as such. The policy to stakeholders is compliant with statutory requirements and in
conformity with the principles of transparency, reporting and business ethics. A policy for taking into account the
stakeholders’ interest, which ensures their attraction and guarantees the balance between the development of the
Company and the environment, in which it operates, has been developed. Efficient connections with all
stakeholders are maintained. The Company informs periodically its shareholders, stakeholders and the investment
society on significant matters.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiii
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
Rules have been adopted for the organization and holding of regular and extraordinary General Meetings of
Shareholders, which guarantee equal treatment for all shareholders and the right of each shareholder to express
his/her opinion on the agenda topics. The procedures and order for convening a General Meeting of Shareholders
do not prevent or make the voting unnecessary more expensive. These procedures encourage the shareholders’
participation in the General Meeting of Shareholders, but do not envisage a possibility for remote presence through
technical devices as this would make the holding of the General Meeting more onerous. Rules on proxy voting
have been adopted. The wording of written materials on the agenda of the General Meeting of Shareholders are
specific and clear, and do not mislead the shareholders. All proposals on major corporate events are presented as
separate agenda items, including the proposal for profit distribution.
To improve the confidence of shareholders, investors and stakeholders in the Company’s management and
operations is one of the key tasks of corporate governance. With respect to that, the Company constantly reaffirms
its position of a stable institution.
In 2023 as well, the approval and implementation of various ways for disclosure of current information on the
Company’s financial and business performance and important corporate events, and their promotion, continued.
KORADO-Bulgaria AD has approved a policy and system for disclosure of information in compliance with the
legal requirements. It guarantees equality of the information addressees (shareholders, stakeholders, investment
society) and prevents abuses in the form of insider dealing.
The system for disclosure of information ensures complete, timely, true and understandable information, which
enables objective and informed decisions and valuations. The Company has implemented in-house rules for the
preparation of annual and interim reports, and disclosure procedure.
The Company maintains its website, which contains corporate information, information about the governing
bodies and shareholding structure of KORADO-Bulgaria AD. The investor section contains internal documents of
the Company, information about the shareholders’ rights and their participation in the General Meeting of
Shareholders, the financial statements for the last 10 years, information about the payment of dividends, as also
for personal data protection. This section also contains materials for the forthcoming General Meetings of
Shareholders of the Company, information on the decisions passed by the General Meeting of Shareholders.
Information about initiatives of the Company, for the auditors and the media that publish news about the holding
is publicly available.
The News section contains information on the periodical publications of the Company, forthcoming events and
important information concerning the Company’s activity. There is a procedure for payment of prior year’s
dividends to be followed by the shareholders.
The practice of sending timely responses to letters and inquiries of shareholders, including such received by email
and their recording in a register duly kept by the Investor relation Directors continues. There is a practice that,
irrespective of the nature of the question, the answer shall contain a detailed explanation of the rights of the
shareholders of the holding. The procedure for transfer of shares by way of inheritance is described in detail. Each
shareholder who, on various occasions, addresses the Company is thoroughly informed of his rights and provided
with information on various matters concerning the activity and current status of the Company, including for the
movement of share prices of KORADO-Bulgaria AD on the stock market.
The corporate governance of KORADO-Bulgaria AD ensures efficient relationships with all stakeholders,
identified by the Company as such. The policy to stakeholders is compliant with statutory requirements and in
conformity with the principles of transparency, reporting and business ethics. A policy for taking into account the
stakeholders’ interest, which ensures their attraction and guarantees the balance between the development of the
Company and the environment, in which it operates, has been developed. Efficient connections with all
stakeholders are maintained. The Company informs periodically its shareholders, stakeholders and the investment
society on significant matters.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiv
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
KORADO-Bulgaria AD participates actively in various forms of mutual cooperation with government institutions
and non-governmental organizations on corporate government matters. The process of information disclosure by
KORADO-Bulgaria AD is subject to multiple controls. So far, no violations of the provisions and terms of
disclosure have been established. The financial statements are published on the Company’s website immediately
after they have been forwarded to the regulatory authority and the public, thus providing for controls by the
shareholders, investors and all stakeholders.
In conclusion, we may summarize that the activities of the governing bodies of KORADO-Bulgaria AD in 2023
were compliant with the National Corporate Governance Code and international standards.
The review and the report on the implementation of the program have found that the basic principles have been
observed, and namely:
✓ Fair presentation and transparency with respect to the occurrence of important corporate events relating to the
Company’s activity;
✓ Protection of the shareholders’ rights and their equal treatment;
✓ Good corporate governance aiming at attracting the interest of potential investors;
✓ Loyalty to the Company;
✓ Regular control over the Company’s business activity by employees of Internal Audit of the parent company;
✓ Compliance with the Code of Ethics with respect to the internal rules of ethics, business behaviour standards,
and prevention of abuses in the form of insider dealing.
In the course of the year, through their regular meetings, Management Board and Supervisory Board, and the
independent Audit Committee assist in ensuring efficient management of the Company.
The procedure for prior notification to the members of SB and MB of the meetings, and their detailed and precise
recording, has been complied with.
As a result of the current control on the activity of the person in charge of investor relations it has been found the
following:
✓ Timely presentation of reports and current information to the Financial Supervision Commission,
Bulgarian Stock Exchange, Central Depository. Information is published on the Company’s website at
www.korado.bg and presented to the public through the e-media www.X3news.com.
✓ Regular keeping of registers for the materials of the General Meeting of Shareholders, minutes of the
meetings of MB and SB, reports and current information sent;
✓ The deadlines for publication of the official notices convening a General Meeting of Shareholders have
been complied with and the notifications required by POSA have been sent;
All quarterly, six months and annual financial statements have been prepared in accordance with International
Financial Reporting Standards, as adopted by EU.
In addition to the above-specified information, the Executive Director has drawn up and signed a Statement of
Corporate Governance pursuant to Article 100m, paragraphs 7 – 9 of POSA, which is enclosed to this report and
forms an integral part hereof.
Dividend
On 21 June 2023 the General Meeting of Shareholders approved distribution of dividends for 2022 amounting to
BGN 1,316 thousand, gross dividend of BGN 0.10 per share.
The dividends are paid through the system of Central Depository AD and the branches of DSK Bank. Their
payment commenced on 19 July 2023.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xiv
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
KORADO-Bulgaria AD participates actively in various forms of mutual cooperation with government institutions
and non-governmental organizations on corporate government matters. The process of information disclosure by
KORADO-Bulgaria AD is subject to multiple controls. So far, no violations of the provisions and terms of
disclosure have been established. The financial statements are published on the Company’s website immediately
after they have been forwarded to the regulatory authority and the public, thus providing for controls by the
shareholders, investors and all stakeholders.
In conclusion, we may summarize that the activities of the governing bodies of KORADO-Bulgaria AD in 2023
were compliant with the National Corporate Governance Code and international standards.
The review and the report on the implementation of the program have found that the basic principles have been
observed, and namely:
✓ Fair presentation and transparency with respect to the occurrence of important corporate events relating to the
Company’s activity;
✓ Protection of the shareholders’ rights and their equal treatment;
✓ Good corporate governance aiming at attracting the interest of potential investors;
✓ Loyalty to the Company;
✓ Regular control over the Company’s business activity by employees of Internal Audit of the parent company;
✓ Compliance with the Code of Ethics with respect to the internal rules of ethics, business behaviour standards,
and prevention of abuses in the form of insider dealing.
In the course of the year, through their regular meetings, Management Board and Supervisory Board, and the
independent Audit Committee assist in ensuring efficient management of the Company.
The procedure for prior notification to the members of SB and MB of the meetings, and their detailed and precise
recording, has been complied with.
As a result of the current control on the activity of the person in charge of investor relations it has been found the
following:
✓ Timely presentation of reports and current information to the Financial Supervision Commission,
Bulgarian Stock Exchange, Central Depository. Information is published on the Company’s website at
www.korado.bg and presented to the public through the e-media www.X3news.com.
✓ Regular keeping of registers for the materials of the General Meeting of Shareholders, minutes of the
meetings of MB and SB, reports and current information sent;
✓ The deadlines for publication of the official notices convening a General Meeting of Shareholders have
been complied with and the notifications required by POSA have been sent;
All quarterly, six months and annual financial statements have been prepared in accordance with International
Financial Reporting Standards, as adopted by EU.
In addition to the above-specified information, the Executive Director has drawn up and signed a Statement of
Corporate Governance pursuant to Article 100m, paragraphs 7 – 9 of POSA, which is enclosed to this report and
forms an integral part hereof.
Dividend
On 21 June 2023 the General Meeting of Shareholders approved distribution of dividends for 2022 amounting to
BGN 1,316 thousand, gross dividend of BGN 0.10 per share.
The dividends are paid through the system of Central Depository AD and the branches of DSK Bank. Their
payment commenced on 19 July 2023.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xv
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
Dividend (continued)
The unpaid dividends will be paid at the registered address of the Company within the statutory deadlines and by
applying the statutory methods.
ISIN code of issue - BG11LUSTAT13.
INFORMATION UNDER ARTICLE 187E AND ARTICLE 247 OF THE COMMERCIAL ACT
Holding of own shares by the Company
The Company holds no own shares.
Holding of shares of the Company by the members of the corporate management of the Company
At 31 December 2023 the chairman of Management Board Jiri Reznicek, held 180 shares, the member of the
Management Board, Silviya Stefanova, held 507 shares of the Company and the member of the Supervisory board
Evelina Miltenova, held 900 shares of the Company.
The other members of the Management and Supervisory Boards hold no shares or bonds of KORADO-Bulgaria
AD, or rights to acquire shares and bonds of the Company. These shares were acquired on the free market on the
conditions of public offering carried out. The other members of the Management and Supervisory Boards hold no
shares or bonds of KORADO-Bulgaria AD, or rights to acquire shares and bonds of the Company, and no such
shares, bonds or rights were acquired in 2023.
Rights of the corporate management members to acquire shares and bonds of the Company
There are no plans at group level of KORADO Group for the acquisition of shares or share options by management
or employees, relating to the shares of the Company. Rights for the acquisition of bonds of the Company have not
been granted to any of the member of the Management Board and/or Supervisory Board.
Participation of the corporate management members in other companies
The members of the Management and Supervisory Boards do not participate in entities as unlimited liability
shareholders.
The members of the Management and Supervisory Boards hold more than 25% of the capital of other entities, as
follows:
Ivan Lyaskov • Smile OOD
• Vitop OOD
• Esam OOD
• Dike-2003 OOD
• Citistroy OOD
• Krameks OOD
Shares of the Company were neither acquired nor transferred by the Board members in 2023.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xv
INFORMATION ON THE PERFORMANCE OF THE RPOGRAM FOR IMPLEMENTATION OF THE
INTERNATIONALLY RECOGNISED GOOD CORPORATE GOVERNANCE STANDARDS
(CONTINUED)
2. Implementation of the National Corporate Governance Code (continued)
Dividend (continued)
The unpaid dividends will be paid at the registered address of the Company within the statutory deadlines and by
applying the statutory methods.
ISIN code of issue - BG11LUSTAT13.
INFORMATION UNDER ARTICLE 187E AND ARTICLE 247 OF THE COMMERCIAL ACT
Holding of own shares by the Company
The Company holds no own shares.
Holding of shares of the Company by the members of the corporate management of the Company
At 31 December 2023 the chairman of Management Board Jiri Reznicek, held 180 shares, the member of the
Management Board, Silviya Stefanova, held 507 shares of the Company and the member of the Supervisory board
Evelina Miltenova, held 900 shares of the Company.
The other members of the Management and Supervisory Boards hold no shares or bonds of KORADO-Bulgaria
AD, or rights to acquire shares and bonds of the Company. These shares were acquired on the free market on the
conditions of public offering carried out. The other members of the Management and Supervisory Boards hold no
shares or bonds of KORADO-Bulgaria AD, or rights to acquire shares and bonds of the Company, and no such
shares, bonds or rights were acquired in 2023.
Rights of the corporate management members to acquire shares and bonds of the Company
There are no plans at group level of KORADO Group for the acquisition of shares or share options by management
or employees, relating to the shares of the Company. Rights for the acquisition of bonds of the Company have not
been granted to any of the member of the Management Board and/or Supervisory Board.
Participation of the corporate management members in other companies
The members of the Management and Supervisory Boards do not participate in entities as unlimited liability
shareholders.
The members of the Management and Supervisory Boards hold more than 25% of the capital of other entities, as
follows:
Ivan Lyaskov • Smile OOD
• Vitop OOD
• Esam OOD
• Dike-2003 OOD
• Citistroy OOD
• Krameks OOD
Shares of the Company were neither acquired nor transferred by the Board members in 2023.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xvi
INFORMATION UNDER ARTICLE 187E AND ARTICLE 247 OF THE COMMERCIAL ACT
(CONTINUED)
Membership in the management board of other entities
The members of the Management Board and Supervisory Board participate in the management of the following
entities:
Tomas Kollert • Licon Heat s.r.o. – member of the Supervisory board
Contracts with Board members and their related parties
No contracts, which fall beyond the ordinary course of business or significantly deviate from market conditions,
were concluded between members of the Management Board and / or Supervisory Board in 2023.
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC
1. Information given in value or quantitative terms about the main categories of commodities, products
and/or provided services, with indication of their share in the revenues from sales of the Company as a
whole and the changes that occurred during the reporting fiscal year.
Information is given in the following table:
Finished product
manufactured, Pcs. Finished products sold (without goods)
Quantity Amount
(BGN thousand)
2022 2023 2022 2023 2022 2023
Panel radiators 343 371 252 454 343 649 255 773 46,712 32,036
Steel rail bathroom radiators 102 287 95 951 102 287 95 951 7,535 6,519
2. Information about the revenues allocated by separate categories of activities, domestic and external
markets as well as information about the sources for supply of materials required for the manufacture of
finished products or the provision of services with indication of the degree of dependence in relation to any
individual seller or buyer/user and in the event that the relative share of any of them exceeds 10 percent of
the costs or revenues from sales, information is provided for each person separately, about his share in sales
or purchases and his relations with the issuer, respectively the person under § 1e of the additional provisions
of the POSA.
REVENUE in BGN’000
Net sales revenue:
1.Finished products 38,555
2.Goods 679
3. Services 40
Total revenue 39,274
Sales revenue by markets:
✓ Domestic market – amounting to BGN 722 thousand, representing 1,84 %.
✓ Export market - amounting to BGN 38,552 thousand, representing 98,16%, including sales amounting to
BGN 33,083 thousand to KORADO a.s., Czech Republic – 84.24%, BGN 1,426 sales to clients in Ukraine – 3,63%
and BGN 1,022 thousand sales to a client Sekpral Pro Instalatii (Romania) – 2,6%, BGN 1,273 thousand sales to
client Hegedus Hungary – 3.24%, client from Greece BGN 1,256 thousand – 3,2% and other clients -
BGN 492 thousand.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xvi
INFORMATION UNDER ARTICLE 187E AND ARTICLE 247 OF THE COMMERCIAL ACT
(CONTINUED)
Membership in the management board of other entities
The members of the Management Board and Supervisory Board participate in the management of the following
entities:
Tomas Kollert • Licon Heat s.r.o. – member of the Supervisory board
Contracts with Board members and their related parties
No contracts, which fall beyond the ordinary course of business or significantly deviate from market conditions,
were concluded between members of the Management Board and / or Supervisory Board in 2023.
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC
1. Information given in value or quantitative terms about the main categories of commodities, products
and/or provided services, with indication of their share in the revenues from sales of the Company as a
whole and the changes that occurred during the reporting fiscal year.
Information is given in the following table:
Finished product
manufactured, Pcs. Finished products sold (without goods)
Quantity Amount
(BGN thousand)
2022 2023 2022 2023 2022 2023
Panel radiators 343 371 252 454 343 649 255 773 46,712 32,036
Steel rail bathroom radiators 102 287 95 951 102 287 95 951 7,535 6,519
2. Information about the revenues allocated by separate categories of activities, domestic and external
markets as well as information about the sources for supply of materials required for the manufacture of
finished products or the provision of services with indication of the degree of dependence in relation to any
individual seller or buyer/user and in the event that the relative share of any of them exceeds 10 percent of
the costs or revenues from sales, information is provided for each person separately, about his share in sales
or purchases and his relations with the issuer, respectively the person under § 1e of the additional provisions
of the POSA.
REVENUE in BGN’000
Net sales revenue:
1.Finished products 38,555
2.Goods 679
3. Services 40
Total revenue 39,274
Sales revenue by markets:
✓ Domestic market – amounting to BGN 722 thousand, representing 1,84 %.
✓ Export market - amounting to BGN 38,552 thousand, representing 98,16%, including sales amounting to
BGN 33,083 thousand to KORADO a.s., Czech Republic – 84.24%, BGN 1,426 sales to clients in Ukraine – 3,63%
and BGN 1,022 thousand sales to a client Sekpral Pro Instalatii (Romania) – 2,6%, BGN 1,273 thousand sales to
client Hegedus Hungary – 3.24%, client from Greece BGN 1,256 thousand – 3,2% and other clients -
BGN 492 thousand.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xvii
ADDITIONAL INFORMATION UNDER SECTION ІVА OF APPENDIX 2 TO ORDINANCE 2 OF FSC
(CONTINUED)
2. Information about the revenues allocated by separate categories of activities, domestic and external
markets as well as information about the sources for supply of materials required for the manufacture of
finished products or the provision of services with indication of the degree of dependence in relation to any
individual seller or buyer/user and in the event that the relative share of any of them exceeds 10 percent of
the costs or revenues from sales, information is provided for each person separately, about his share in sales
or purchases and his relations with the issuer, respectively the person under § 1e of the additional provisions
of the POSA. (continued)
Total purchases of materials for 2023 amount to BGN 18,819 thousand. Purchases are concentrated in 6 major
suppliers, which constitute 70% of total purchases. The general suppliers which deliver more than 10 % of all
materials are:
✓ Borcelik Tikaret (Turkey) - BGN 9,071 thousand or 48%
✓ Профсан Бору Челик /Турция/ BGN 1,029 thousand or 5,47%
✓ Хъс ООД/България BGN 1,158 thousand or 6,15%
3. Information about concluded large transactions and such of material importance for the Company’s
activity.
In the reporting year of 2023, there were no large transactions or such of significant importance to the activity of
the Company.
4. Information about the transactions concluded between the issuer , respectively the person under § 1e of
the additional provisions of the POSAand related parties during the reporting period, proposals for
conclusion of such transactions as well as transactions, which are outside its usual activity or substantially
deviate from the market conditions, to which the issuer, respectively the person under § 1e of the additional
provisions of the POSA or its subsidiary, is a party, indicating the value of the transactions, the nature of
the relation and any information necessary to assess the impact on the issuer's financial condition,
respectively, the person under § 1e of the additional provisions of the POSA.
During the reporting period, there were no transactions, which are outside the usual activity of the Company, and
proposals for conclusion of such transactions were not received. Besides with the parent company KORADO a.s.,
Czech Republic, in 2023, the Company had deals with other related parties as well, such as LICON HEAT, Czech
Republic (a 100% subsidiary of KORADO a.s., Czech Republic).All related party transactions of the Company
are concluded on usual market conditions, including, but not limited to, their price levels. Related party
transactions concluded in 2023 are disclosed in Note 16 to the financial statements.
5. Information about events and indicators of unusual for the issuer, respectively the person under § 1e of
the additional provisions of the POSAnature, having substantial influence over its operation and the
realized revenues and expenses incurred; assessment of their influence over the results during the current
year.
In 2023, there were no events or indicators of unusual for the Company nature.
6. Information about off-balance transactions- nature and business purpose, indication of the financial
impact of the transactions on the activity, if the risk and benefits of these transactions are material for the
issuer, respectively the person under § 1e of the additional provisions of the POSA, and if the disclosure of
this information is essential for the assessment of the financial position of the issuer, respectively, the person
under § 1e of the additional provisions of the POSA.
Off-balance sheet transactions were not concluded in 2023.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xvii
ADDITIONAL INFORMATION UNDER SECTION ІVА OF APPENDIX 2 TO ORDINANCE 2 OF FSC
(CONTINUED)
2. Information about the revenues allocated by separate categories of activities, domestic and external
markets as well as information about the sources for supply of materials required for the manufacture of
finished products or the provision of services with indication of the degree of dependence in relation to any
individual seller or buyer/user and in the event that the relative share of any of them exceeds 10 percent of
the costs or revenues from sales, information is provided for each person separately, about his share in sales
or purchases and his relations with the issuer, respectively the person under § 1e of the additional provisions
of the POSA. (continued)
Total purchases of materials for 2023 amount to BGN 18,819 thousand. Purchases are concentrated in 6 major
suppliers, which constitute 70% of total purchases. The general suppliers which deliver more than 10 % of all
materials are:
✓ Borcelik Tikaret (Turkey) - BGN 9,071 thousand or 48%
✓ Профсан Бору Челик /Турция/ BGN 1,029 thousand or 5,47%
✓ Хъс ООД/България BGN 1,158 thousand or 6,15%
3. Information about concluded large transactions and such of material importance for the Company’s
activity.
In the reporting year of 2023, there were no large transactions or such of significant importance to the activity of
the Company.
4. Information about the transactions concluded between the issuer , respectively the person under § 1e of
the additional provisions of the POSAand related parties during the reporting period, proposals for
conclusion of such transactions as well as transactions, which are outside its usual activity or substantially
deviate from the market conditions, to which the issuer, respectively the person under § 1e of the additional
provisions of the POSA or its subsidiary, is a party, indicating the value of the transactions, the nature of
the relation and any information necessary to assess the impact on the issuer's financial condition,
respectively, the person under § 1e of the additional provisions of the POSA.
During the reporting period, there were no transactions, which are outside the usual activity of the Company, and
proposals for conclusion of such transactions were not received. Besides with the parent company KORADO a.s.,
Czech Republic, in 2023, the Company had deals with other related parties as well, such as LICON HEAT, Czech
Republic (a 100% subsidiary of KORADO a.s., Czech Republic).All related party transactions of the Company
are concluded on usual market conditions, including, but not limited to, their price levels. Related party
transactions concluded in 2023 are disclosed in Note 16 to the financial statements.
5. Information about events and indicators of unusual for the issuer, respectively the person under § 1e of
the additional provisions of the POSAnature, having substantial influence over its operation and the
realized revenues and expenses incurred; assessment of their influence over the results during the current
year.
In 2023, there were no events or indicators of unusual for the Company nature.
6. Information about off-balance transactions- nature and business purpose, indication of the financial
impact of the transactions on the activity, if the risk and benefits of these transactions are material for the
issuer, respectively the person under § 1e of the additional provisions of the POSA, and if the disclosure of
this information is essential for the assessment of the financial position of the issuer, respectively, the person
under § 1e of the additional provisions of the POSA.
Off-balance sheet transactions were not concluded in 2023.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xviii
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
7. Information about holdings of the issuer, respectively the person under § 1e of the additional provisions
of the POSA, about its main investments in the country and abroad (in securities, financial instruments,
intangible assets and real estate), as well as the investments in equity securities outside its economic group
according to the Accountancy Act and the sources/ways of financing.
At 31 December 2023, KORADO-Bulgaria AD held no shares in other companies and/or participations in
subsidiaries. Information with regards to the acquired intangible assets and property, plant and equipment is
disclosed in Notes 6 and 7 to the financial statements.
8. Information about the concluded by the issuer, respectively the person under § 1e of the additional
provisions of the POSA, by its subsidiary in their capacity as borrowers, loan contracts with indication of
the terms and conditions thereof, including the deadlines for repayment as well as information on the
provided guarantees and assuming of liabilities.
The loan from the parent company granted in 2016 was repaid and as of 31.12.2023 is 0 BGN.
In October 2022 the Company signed a new loan contract with the parent company at the amount of BGN 2,347
thousand which is due in 2027. As of 31 December 2023 the due loan amounts to BGN 2,347 thousand.
Contracts were not concluded and commitments for provision of guarantees and assumption of liabilities were not
taken by the Company.
The parent company has received financing for the total amount of CZK 107 111 million
(2022: CZK 75 356 million) maturing in 2024-2030 years from financial institutions with an interest rate of
1M EURIBOR+1.55% and 1M EURIBOR +0.95.
9. Information about the loans, granted by the issuer, respectively by a person under § 1e of the Additional
Provisions of the POSA, or by their subsidiaries, providing guarantees or assuming obligations in total to
one person or his subsidiary, including related parties with name and UIC of the person, the nature of the
relationship between the issuer, respectively the person under § 1e of the additional provisions of the POSA,
or their subsidiaries and the borrower, the amount of outstanding principal, interest rate, contract date,
repayment deadline, the amount of the commitment, specific conditions other than those provided for in
this provision, as well as the purpose for which they were granted, in case they were concluded as targeted.
Contracts were not concluded by the Company in the capacity as a lender and guarantees of any type were not
provided by the Company in 2023. The parent company has provided financing to Licon Heat in the total amount
of CZK 37 mil (2022: CZK 37 million) maturing on 31.12.2027 with an interest rate of 1MPRIBOR+1%, to
KORADO Polska in the total amount of CZK 37 million (2021: CZK 37 million) maturing on 31.12.2023 and
with an interest rate of 1.7% .
10. Information on the use of the funds from a new issue of securities carried out during the reported period.
The Company has not issued new securities in 2023.
11. Analysis of the ratio between the achieved financial results reflected in the financial statement for the
fiscal year and previously published forecasts for these results.
The Company has published forecasted results for 2023.
12. Analysis and assessment of the policy concerning the management of the financial resources with
indication of the possibilities for servicing of the liabilities, eventual jeopardizes and measures which the
issuer, respectively by a person under § 1e of the Additional Provisions of the POSA, has undertaken or is
to undertake with a view to their removal.
In 2023, the Company continued to implement systemically its financial resource management policy and thanks
to that, it has sufficient funds to meet its liabilities in 2024. The Company’s management is of the opinion that
there are no threats to such current servicing, which go beyond the ordinary course of the activity. Therefore,
measures for the removal of such threats are not envisaged. Liquidity ratios are described above.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xviii
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
7. Information about holdings of the issuer, respectively the person under § 1e of the additional provisions
of the POSA, about its main investments in the country and abroad (in securities, financial instruments,
intangible assets and real estate), as well as the investments in equity securities outside its economic group
according to the Accountancy Act and the sources/ways of financing.
At 31 December 2023, KORADO-Bulgaria AD held no shares in other companies and/or participations in
subsidiaries. Information with regards to the acquired intangible assets and property, plant and equipment is
disclosed in Notes 6 and 7 to the financial statements.
8. Information about the concluded by the issuer, respectively the person under § 1e of the additional
provisions of the POSA, by its subsidiary in their capacity as borrowers, loan contracts with indication of
the terms and conditions thereof, including the deadlines for repayment as well as information on the
provided guarantees and assuming of liabilities.
The loan from the parent company granted in 2016 was repaid and as of 31.12.2023 is 0 BGN.
In October 2022 the Company signed a new loan contract with the parent company at the amount of BGN 2,347
thousand which is due in 2027. As of 31 December 2023 the due loan amounts to BGN 2,347 thousand.
Contracts were not concluded and commitments for provision of guarantees and assumption of liabilities were not
taken by the Company.
The parent company has received financing for the total amount of CZK 107 111 million
(2022: CZK 75 356 million) maturing in 2024-2030 years from financial institutions with an interest rate of
1M EURIBOR+1.55% and 1M EURIBOR +0.95.
9. Information about the loans, granted by the issuer, respectively by a person under § 1e of the Additional
Provisions of the POSA, or by their subsidiaries, providing guarantees or assuming obligations in total to
one person or his subsidiary, including related parties with name and UIC of the person, the nature of the
relationship between the issuer, respectively the person under § 1e of the additional provisions of the POSA,
or their subsidiaries and the borrower, the amount of outstanding principal, interest rate, contract date,
repayment deadline, the amount of the commitment, specific conditions other than those provided for in
this provision, as well as the purpose for which they were granted, in case they were concluded as targeted.
Contracts were not concluded by the Company in the capacity as a lender and guarantees of any type were not
provided by the Company in 2023. The parent company has provided financing to Licon Heat in the total amount
of CZK 37 mil (2022: CZK 37 million) maturing on 31.12.2027 with an interest rate of 1MPRIBOR+1%, to
KORADO Polska in the total amount of CZK 37 million (2021: CZK 37 million) maturing on 31.12.2023 and
with an interest rate of 1.7% .
10. Information on the use of the funds from a new issue of securities carried out during the reported period.
The Company has not issued new securities in 2023.
11. Analysis of the ratio between the achieved financial results reflected in the financial statement for the
fiscal year and previously published forecasts for these results.
The Company has published forecasted results for 2023.
12. Analysis and assessment of the policy concerning the management of the financial resources with
indication of the possibilities for servicing of the liabilities, eventual jeopardizes and measures which the
issuer, respectively by a person under § 1e of the Additional Provisions of the POSA, has undertaken or is
to undertake with a view to their removal.
In 2023, the Company continued to implement systemically its financial resource management policy and thanks
to that, it has sufficient funds to meet its liabilities in 2024. The Company’s management is of the opinion that
there are no threats to such current servicing, which go beyond the ordinary course of the activity. Therefore,
measures for the removal of such threats are not envisaged. Liquidity ratios are described above.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xix
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
13. Assessment of the possibilities for realization of the investment intentions indicating the amount of
available funds and showing possible changes in the financing structure of this activity.
The activity of KORADO-Bulgaria AD is directed primarily towards management of current investments.
14. Information about changes occurred during the reporting period changes in the basic principles for
management of the issuer, respectively by a person under § 1e of the Additional Provisions of the POSA
and its economic group according to the Accountancy Act.
The base principles for management of the Company and its economic group have not been changed.
15. Information about the main characteristics of the applied by the issuer, respectively by a person under
§ 1e of the Additional Provisions of the POSA in the course of preparation of the financial statements
internal controls system and risk management system.
In the process of preparation of the financial statements for 2023, internal control activities include stocktaking of
inventories carried out once a year and of work in progress carried out on a monthly basis, with all required
accounting adjustments according to the inventory lists expressed in values.
The control on the waste of inventories is exercised on a monthly basis. Cash is counted on a quarterly basis. At
the end of each financial year, the balances of the Company – receivables and payables, are checked as well.
Financial control is exercised currently by management and on annual basis by internal auditors of the parent
company in accordance with International Standards on Internal Auditing.
16. Information on the changes in the management and supervisory bodies during the reporting fiscal year.
In 2023 there are no changes to the management bodies. By decision of GM dated 14.02.2023 a change in the
members of Audit committee has been made.
17. Information on the amount of remuneration, rewards and / or benefits of each of the members of the
management and supervisory bodies for the reporting financial year, paid by the issuer, which is not a
public company, respectively the person under § 1e of the additional provisions of POSA and its subsidiary
companies, regardless of whether they were included in the expenses of the issuer, which is not a public
company, respectively the person under § 1e of the additional provisions of the POSA, or arise from the
distribution of profit, including:
(a) Received amounts and non-monetary remuneration;
(b) Conditional or rescheduled remuneration arisen during the year, even if the remuneration is due at a later date;
c) An amount payable by the issuer, which is not a public company, respectively the person under § 1e of the
additional provisions of the POSA, or its subsidiaries for payment of pensions, retirement benefits or other similar
benefits.
The remuneration of the members of the management and control bodies is as follows:
• The members of the Management Board include the Executive Director, the Chief Accountant and a non-
employee member of the Company, who is an employee of the Group. The remuneration they receive for the
performance of their duties as employees are disclosed in Note 16 to the financial statements. They are remunerated
for their role as board members from 16.09.2021 according to Decision of GM/15.09.2021 with the annual amount
of BGN 9 thousand to each member.
• Two of the members of the Supervisory Board have received remuneration in 2023 and each of them has
received the amount of BGN 23 thousand. Two of the members of the Supervisory Board have received
remuneration for their role as SB members from 16.09.2021 according to Decision of GM/15.09.2021 at the
amount of BGN 9 thousand to each member, as they are employees of the Group.
Unpaid remunerations as at 31 December to 2023 amount to BGN 8 thousand.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xix
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
13. Assessment of the possibilities for realization of the investment intentions indicating the amount of
available funds and showing possible changes in the financing structure of this activity.
The activity of KORADO-Bulgaria AD is directed primarily towards management of current investments.
14. Information about changes occurred during the reporting period changes in the basic principles for
management of the issuer, respectively by a person under § 1e of the Additional Provisions of the POSA
and its economic group according to the Accountancy Act.
The base principles for management of the Company and its economic group have not been changed.
15. Information about the main characteristics of the applied by the issuer, respectively by a person under
§ 1e of the Additional Provisions of the POSA in the course of preparation of the financial statements
internal controls system and risk management system.
In the process of preparation of the financial statements for 2023, internal control activities include stocktaking of
inventories carried out once a year and of work in progress carried out on a monthly basis, with all required
accounting adjustments according to the inventory lists expressed in values.
The control on the waste of inventories is exercised on a monthly basis. Cash is counted on a quarterly basis. At
the end of each financial year, the balances of the Company – receivables and payables, are checked as well.
Financial control is exercised currently by management and on annual basis by internal auditors of the parent
company in accordance with International Standards on Internal Auditing.
16. Information on the changes in the management and supervisory bodies during the reporting fiscal year.
In 2023 there are no changes to the management bodies. By decision of GM dated 14.02.2023 a change in the
members of Audit committee has been made.
17. Information on the amount of remuneration, rewards and / or benefits of each of the members of the
management and supervisory bodies for the reporting financial year, paid by the issuer, which is not a
public company, respectively the person under § 1e of the additional provisions of POSA and its subsidiary
companies, regardless of whether they were included in the expenses of the issuer, which is not a public
company, respectively the person under § 1e of the additional provisions of the POSA, or arise from the
distribution of profit, including:
(a) Received amounts and non-monetary remuneration;
(b) Conditional or rescheduled remuneration arisen during the year, even if the remuneration is due at a later date;
c) An amount payable by the issuer, which is not a public company, respectively the person under § 1e of the
additional provisions of the POSA, or its subsidiaries for payment of pensions, retirement benefits or other similar
benefits.
The remuneration of the members of the management and control bodies is as follows:
• The members of the Management Board include the Executive Director, the Chief Accountant and a non-
employee member of the Company, who is an employee of the Group. The remuneration they receive for the
performance of their duties as employees are disclosed in Note 16 to the financial statements. They are remunerated
for their role as board members from 16.09.2021 according to Decision of GM/15.09.2021 with the annual amount
of BGN 9 thousand to each member.
• Two of the members of the Supervisory Board have received remuneration in 2023 and each of them has
received the amount of BGN 23 thousand. Two of the members of the Supervisory Board have received
remuneration for their role as SB members from 16.09.2021 according to Decision of GM/15.09.2021 at the
amount of BGN 9 thousand to each member, as they are employees of the Group.
Unpaid remunerations as at 31 December to 2023 amount to BGN 8 thousand.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xx
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
18. For the public companies – information about the owned by the members of the management and of the
control bodies and procurators shares of the Company, including the shares held by anyone of them
separately or as a percent from the shares of each class, as well as provided to them options on securities of
the Company by the latter – type and amount of the securities over which the options have been set up, price
of exercising of the options, purchase price, if any, and term of the options.
At 31 December 2023 the Chairman of MB Jiri Reznicek held 180 shares, the member of MB, Silviya Stefanova,
held 507 shares and the member of SB, Evelina Miltenova, held 900 shares of the Company. The other members
of the Management and Supervisory Boards hold no shares or bonds of KORADO-Bulgaria AD, or rights to
acquire shares and bonds of the Company.
19. Information about the known to the Company agreements (including also after the fiscal year closing)
as a result of which changes may occur at a future time in the owned percent of shares or bonds by current
shareholders and bondholder.
The Company has no information for such agreements.
20. Information about pending court, administrative or arbitration proceedings relating to liabilities or
receivables of the issuer, respectively by a person under § 1e of the Additional Provisions of the POSA of an
amount of at least 10 percent of its equity; if the total amount of the liabilities or receivables of the issuer,
respectively by a person under § 1e of the Additional Provisions of the POSA under all initiated proceedings
exceeds 10 per cent of its equity, information shall be submitted for each procedure separately.
As at 31 December 2023, there were no pending courts, administrative or arbitration proceedings, involving the
Company, relating to liabilities of an amount of at least 10 percent of its equity.
21. For public entities - name of the Investor Relations Director, including telephone and address for
correspondence.
The person in charge of investor relations is Snezhana Petrova Baycheva,
Correspondence address: town of Strazhitsa, 28 Gladstone Street
е -mail: snezhana.baycheva@korado.bg, tel.: 06161 4245
22. Non-financial declaration under Art. 41 of the Accountancy Act - for financial statements on an
individual basis, respectively under Art. 51 of the Accountancy Act - for financial statements on a
consolidated basis, where applicable.
23. Other information at the discretion of the Company.
Changes in the price of the stocks of the Company
All shares of the issuer are registered and traded on Bulgarian Stock Exchange – Sofia AD, Premium Segment.
Number of shares in circulation: 13 168 614.
Issuer: KORADO Bulgaria AD
Stock exchange code: KBG(4KX)
ISIN code: BG11LUSTAT13
In the period 01.01.2023 – 31.12.2023 the issue of shares was traded as follows:
Turnover /BGN/: 315,326
Shares transferred 64,825
Number of transactions 352
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xx
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
18. For the public companies – information about the owned by the members of the management and of the
control bodies and procurators shares of the Company, including the shares held by anyone of them
separately or as a percent from the shares of each class, as well as provided to them options on securities of
the Company by the latter – type and amount of the securities over which the options have been set up, price
of exercising of the options, purchase price, if any, and term of the options.
At 31 December 2023 the Chairman of MB Jiri Reznicek held 180 shares, the member of MB, Silviya Stefanova,
held 507 shares and the member of SB, Evelina Miltenova, held 900 shares of the Company. The other members
of the Management and Supervisory Boards hold no shares or bonds of KORADO-Bulgaria AD, or rights to
acquire shares and bonds of the Company.
19. Information about the known to the Company agreements (including also after the fiscal year closing)
as a result of which changes may occur at a future time in the owned percent of shares or bonds by current
shareholders and bondholder.
The Company has no information for such agreements.
20. Information about pending court, administrative or arbitration proceedings relating to liabilities or
receivables of the issuer, respectively by a person under § 1e of the Additional Provisions of the POSA of an
amount of at least 10 percent of its equity; if the total amount of the liabilities or receivables of the issuer,
respectively by a person under § 1e of the Additional Provisions of the POSA under all initiated proceedings
exceeds 10 per cent of its equity, information shall be submitted for each procedure separately.
As at 31 December 2023, there were no pending courts, administrative or arbitration proceedings, involving the
Company, relating to liabilities of an amount of at least 10 percent of its equity.
21. For public entities - name of the Investor Relations Director, including telephone and address for
correspondence.
The person in charge of investor relations is Snezhana Petrova Baycheva,
Correspondence address: town of Strazhitsa, 28 Gladstone Street
е -mail: snezhana.baycheva@korado.bg, tel.: 06161 4245
22. Non-financial declaration under Art. 41 of the Accountancy Act - for financial statements on an
individual basis, respectively under Art. 51 of the Accountancy Act - for financial statements on a
consolidated basis, where applicable.
23. Other information at the discretion of the Company.
Changes in the price of the stocks of the Company
All shares of the issuer are registered and traded on Bulgarian Stock Exchange – Sofia AD, Premium Segment.
Number of shares in circulation: 13 168 614.
Issuer: KORADO Bulgaria AD
Stock exchange code: KBG(4KX)
ISIN code: BG11LUSTAT13
In the period 01.01.2023 – 31.12.2023 the issue of shares was traded as follows:
Turnover /BGN/: 315,326
Shares transferred 64,825
Number of transactions 352
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xxi
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
23. Other information at the discretion of the Company. (continued)
According to BSE, the changes in the price of the Company's shares during 2023 are as follows:
✓ minimum – 4.06 BGN
✓ maximum – 6.40 BGN
✓ average - 4.924 BGN
✓ last – 4.06 BGN
The Company has submitted on time the required by the Public Information Act information to the Financial
Supervision Commission and the Bulgarian Stock Exchange. This information is available to shareholders and
investors on the company's website -www.korado.bg и www.x3news.com.
KORADO – Bulgaria AD is aware that maintaining the trust and security of shareholders, employees, customers
and all the people it works with, as well as the communities in which it operates, is extremely important for the
Company's continued development and success.
The following graph shows the movements in the price of the Company’s shares in 2023:
The Company timely submitted to FSC and BSE the statutory information within the relevant deadlines.
ANALYSIS AND EXPLANATION OF INFORMATION PURSUANT TO APPENDIX 3 TO ORDINANCE 2
OF FSC
1. Information about securities that have not been admitted to trading on a regulated market in the Republic
of Bulgaria or another Member State.
As of December 31, 2023, the Company has not issued securities that have not been admitted to trading on a
regulated market in the Republic of Bulgaria or another Member State.
2. Information about the direct and indirect holding of 5 or more per cent of the voting rights at the General
Meeting of the Company, including information about the shareholders, the amount of their shareholding
and the manner in which the shares are owned.
More than 5 per cent of the shares of the Company are held directly only by the shareholder KORADO a.s. Czech
Republic. This shareholder is registered with the Register of the local court Hradec Králové, Section B, Batch
1500, Date of entry: 01 September 1996, UIC 25255843 /according to the system of Czech Republic/, with
registered address and address of management: Czech Republic, město ČeskáTřebová, okres Ústínad Orlicí, ulice
Bří Hubálku 869, Postal Code 560 02.
The amount of the shareholding of this shareholder as of 31.12.2023 includes 10 817 923 shares, or 82.15% of the
total shares of the Company.
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xxi
ADDITIONAL INFORMATION UNDER APPENDIX 2 TO ORDINANCE 2 OF FSC (CONTINUED)
23. Other information at the discretion of the Company. (continued)
According to BSE, the changes in the price of the Company's shares during 2023 are as follows:
✓ minimum – 4.06 BGN
✓ maximum – 6.40 BGN
✓ average - 4.924 BGN
✓ last – 4.06 BGN
The Company has submitted on time the required by the Public Information Act information to the Financial
Supervision Commission and the Bulgarian Stock Exchange. This information is available to shareholders and
investors on the company's website -www.korado.bg и www.x3news.com.
KORADO – Bulgaria AD is aware that maintaining the trust and security of shareholders, employees, customers
and all the people it works with, as well as the communities in which it operates, is extremely important for the
Company's continued development and success.
The following graph shows the movements in the price of the Company’s shares in 2023:
The Company timely submitted to FSC and BSE the statutory information within the relevant deadlines.
ANALYSIS AND EXPLANATION OF INFORMATION PURSUANT TO APPENDIX 3 TO ORDINANCE 2
OF FSC
1. Information about securities that have not been admitted to trading on a regulated market in the Republic
of Bulgaria or another Member State.
As of December 31, 2023, the Company has not issued securities that have not been admitted to trading on a
regulated market in the Republic of Bulgaria or another Member State.
2. Information about the direct and indirect holding of 5 or more per cent of the voting rights at the General
Meeting of the Company, including information about the shareholders, the amount of their shareholding
and the manner in which the shares are owned.
More than 5 per cent of the shares of the Company are held directly only by the shareholder KORADO a.s. Czech
Republic. This shareholder is registered with the Register of the local court Hradec Králové, Section B, Batch
1500, Date of entry: 01 September 1996, UIC 25255843 /according to the system of Czech Republic/, with
registered address and address of management: Czech Republic, město ČeskáTřebová, okres Ústínad Orlicí, ulice
Bří Hubálku 869, Postal Code 560 02.
The amount of the shareholding of this shareholder as of 31.12.2023 includes 10 817 923 shares, or 82.15% of the
total shares of the Company.
KORADO-BULGARIA AD
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xxii
ANALYSIS AND EXPLANATION OF INFORMATION PURSUANT TO APPENDIX 3 TO ORDINANCE 2
OF FSC (CONTINUED
3. Information about the shareholders with special control rights and description of these rights
There are no shareholders with special control rights.
4. Agreements among the shareholders, which are known to the Company and which may result in
limitations over the transfer of shares or the voting right.
The Company is not aware of and it has not been notified of any agreements among the shareholders, which may
result in limitations over the transfer of shares and/or the voting rights.
5. Significant contracts of the Company which give rise to action, have been amended or terminated due to
change in the control of the Company upon carrying out of obligatory tender offer and the consequences
thereof, save for the cases when the disclosure of such information may cause serious damages to the
Company; the exception of the previous sentence shall not apply in the cases when the Company must
disclose information by virtue of the law.
The Company has no significant contracts concluded, which correspond to the type and nature described herein,
including giving rise to action upon the occurrence of these conditions.
FUTURE DEVELOPMENT PERSPECTIVES
Management has set the following goals to be achieved in 2024:
• Maintenance and increase of the production volumes;
• Seeking new partners in order to increase the sales on the Bulgarian market and most of all, of radiators
manufactured by using new technology;
• Preserving the share of trade in heating units on the Bulgarian market;
• Maintaining the optimal volume of sales in the territories in which KORADO-Bulgaria AD recently
conducts its sales (Romania, France, Hungary, Tunisia and Greece);
• Full utilisation of all benefits of the memberships in KORADO Group;
KORADO-Bulgaria AD strives for high standards in its activity, aiming to maintain and develop its long-term
positions in the competitive environment in which it has chosen to operate. We are committed to contributing to
the sustainable development of society. This requires striking a balance between short-term and long-term interests
and taking all economic, environmental and social considerations into account when making business decisions.
MANAGEMENT’S RESPONSIBILITIES
Management is required by Bulgarian legislation to prepare financial statements each financial year that give a
true and fair view of the financial position of the Company as at the year end and of its financial performance and
its cash-flows for the year then ended in accordance with IFRS.
Management confirms that appropriate accounting policies have been used and applied consistently and that
reasonable and prudent judgments and estimates have been used in the preparation of the financial statements for
the year ended 31 December 2023. Management also confirms that all applicable accounting standards have been
followed and that the financial statements have been prepared on a going concern basis.
Management is responsible for keeping proper accounting records, for safeguarding the assets of the Company
and for taking reasonable steps for the prevention and detection of fraud and other irregularities.
JIRI REZNICEK
Executive Director
KORADO-Bulgaria AD
Town of Strazhitsa
ANNUAL ACTIVITY REPORT (CONTINUED)
For the period ended 31 December 2023
xxii
ANALYSIS AND EXPLANATION OF INFORMATION PURSUANT TO APPENDIX 3 TO ORDINANCE 2
OF FSC (CONTINUED
3. Information about the shareholders with special control rights and description of these rights
There are no shareholders with special control rights.
4. Agreements among the shareholders, which are known to the Company and which may result in
limitations over the transfer of shares or the voting right.
The Company is not aware of and it has not been notified of any agreements among the shareholders, which may
result in limitations over the transfer of shares and/or the voting rights.
5. Significant contracts of the Company which give rise to action, have been amended or terminated due to
change in the control of the Company upon carrying out of obligatory tender offer and the consequences
thereof, save for the cases when the disclosure of such information may cause serious damages to the
Company; the exception of the previous sentence shall not apply in the cases when the Company must
disclose information by virtue of the law.
The Company has no significant contracts concluded, which correspond to the type and nature described herein,
including giving rise to action upon the occurrence of these conditions.
FUTURE DEVELOPMENT PERSPECTIVES
Management has set the following goals to be achieved in 2024:
• Maintenance and increase of the production volumes;
• Seeking new partners in order to increase the sales on the Bulgarian market and most of all, of radiators
manufactured by using new technology;
• Preserving the share of trade in heating units on the Bulgarian market;
• Maintaining the optimal volume of sales in the territories in which KORADO-Bulgaria AD recently
conducts its sales (Romania, France, Hungary, Tunisia and Greece);
• Full utilisation of all benefits of the memberships in KORADO Group;
KORADO-Bulgaria AD strives for high standards in its activity, aiming to maintain and develop its long-term
positions in the competitive environment in which it has chosen to operate. We are committed to contributing to
the sustainable development of society. This requires striking a balance between short-term and long-term interests
and taking all economic, environmental and social considerations into account when making business decisions.
MANAGEMENT’S RESPONSIBILITIES
Management is required by Bulgarian legislation to prepare financial statements each financial year that give a
true and fair view of the financial position of the Company as at the year end and of its financial performance and
its cash-flows for the year then ended in accordance with IFRS.
Management confirms that appropriate accounting policies have been used and applied consistently and that
reasonable and prudent judgments and estimates have been used in the preparation of the financial statements for
the year ended 31 December 2023. Management also confirms that all applicable accounting standards have been
followed and that the financial statements have been prepared on a going concern basis.
Management is responsible for keeping proper accounting records, for safeguarding the assets of the Company
and for taking reasonable steps for the prevention and detection of fraud and other irregularities.
JIRI REZNICEK
Executive Director
KORADO-Bulgaria AD
Town of Strazhitsa
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT
31 December 2023
xxiii
CORPORATE GOVERNANCE STATEMENT FOR 2023
OF KORADO– Bulgaria AD
The undersigned,
Jiri Reznicek , in my capacity as a representative of KORADO – Bulgaria AD , a company, incorporated and
existing in accordance with the laws of the Republic of Bulgaria, with head office and address of management in
Veliko Tarnovo Region, Strazhitsa Municipality, town of Strazhitsa 5150, 28 Gladstone Street, registered with the
Commercial Register of the Registry Agency under UIC814190902 (hereinafter referred to as the „Company” ),
HEREBY DECLARE:
I. Substance and subject-matter of the Corporate Governance Statement
1. This Corporate Governance Statement (hereinafter referred to as the „ Statement ”) has been prepared in
accordance with Article 100 m, paragraphs 7 and 8 of POSA and Article 40, paragraphs 1 and 2 of the Accountancy
Act and forms an integral part of the annual management report on the Company’s activity for the period 01
January 2023 – 31 December 2023 (hereinafter referred to as the „ Reporting period ”). The purpose of the
Statement is to provide information on the higher criteria and standards implemented by the Company in the area
of corporate governance, which the Company intends to implement in future as well. In pursuance with the legal
requirements, the Company has published its Statement on the website at: www.korado.bg.
II. Compliance with the Code of Corporate Governance
2. The Company is guided by the principles of good corporate governance. Pursuant to a decision of the
Management Board of the Company, as of September 2017 the Company observes, as appropriate, the National
Corporate Governance Code (hereinafter referred to as the „NCGC”) . Being a member of KORADO Group, the
Company complies with any and all internal corporate governance regulations. These regulations include, among
others, also:
(a) . Corporate governance key principles policy;
(b) . Code of Ethics; and
(c). Prevention of corruptive practices rules.
The above internal regulations have been developed in compliance with the effective legislation, the provisions of
the Articles of Association of the Company, NCGC, and the corporate governance principles of the Organisation
of Economic Cooperation and Development. By applying these regulations, the Company ensures full compliance
with corporate governance best practices and standards.
The Company applies the following mandatory requirements:
• protection of shareholders' rights;
• ensuring fair treatment of all shareholders irrespective of the number of shares held by the m;
• recognition of stakeholders' rights and promotion of cooperation between the Company and stakeholders;
• ensuring timely and accurate disclosure of information on all matters relating to the Company, including
with regard to its financial performance, property and management;
• ensuring effective control of Company's management and supervisory bodies and reporting to
shareholders.
3. Good corporate governance standards are applied based on the principle “comply or explain”. This
requires that in case of deviation from the standards the corporate management of the Company to explain the
reasons for the deviation and to disclose the m. During the reporting period, there were no deviations or indications
of possible deviations.
CORPORATE GOVERNANCE STATEMENT
31 December 2023
xxiii
CORPORATE GOVERNANCE STATEMENT FOR 2023
OF KORADO– Bulgaria AD
The undersigned,
Jiri Reznicek , in my capacity as a representative of KORADO – Bulgaria AD , a company, incorporated and
existing in accordance with the laws of the Republic of Bulgaria, with head office and address of management in
Veliko Tarnovo Region, Strazhitsa Municipality, town of Strazhitsa 5150, 28 Gladstone Street, registered with the
Commercial Register of the Registry Agency under UIC814190902 (hereinafter referred to as the „Company” ),
HEREBY DECLARE:
I. Substance and subject-matter of the Corporate Governance Statement
1. This Corporate Governance Statement (hereinafter referred to as the „ Statement ”) has been prepared in
accordance with Article 100 m, paragraphs 7 and 8 of POSA and Article 40, paragraphs 1 and 2 of the Accountancy
Act and forms an integral part of the annual management report on the Company’s activity for the period 01
January 2023 – 31 December 2023 (hereinafter referred to as the „ Reporting period ”). The purpose of the
Statement is to provide information on the higher criteria and standards implemented by the Company in the area
of corporate governance, which the Company intends to implement in future as well. In pursuance with the legal
requirements, the Company has published its Statement on the website at: www.korado.bg.
II. Compliance with the Code of Corporate Governance
2. The Company is guided by the principles of good corporate governance. Pursuant to a decision of the
Management Board of the Company, as of September 2017 the Company observes, as appropriate, the National
Corporate Governance Code (hereinafter referred to as the „NCGC”) . Being a member of KORADO Group, the
Company complies with any and all internal corporate governance regulations. These regulations include, among
others, also:
(a) . Corporate governance key principles policy;
(b) . Code of Ethics; and
(c). Prevention of corruptive practices rules.
The above internal regulations have been developed in compliance with the effective legislation, the provisions of
the Articles of Association of the Company, NCGC, and the corporate governance principles of the Organisation
of Economic Cooperation and Development. By applying these regulations, the Company ensures full compliance
with corporate governance best practices and standards.
The Company applies the following mandatory requirements:
• protection of shareholders' rights;
• ensuring fair treatment of all shareholders irrespective of the number of shares held by the m;
• recognition of stakeholders' rights and promotion of cooperation between the Company and stakeholders;
• ensuring timely and accurate disclosure of information on all matters relating to the Company, including
with regard to its financial performance, property and management;
• ensuring effective control of Company's management and supervisory bodies and reporting to
shareholders.
3. Good corporate governance standards are applied based on the principle “comply or explain”. This
requires that in case of deviation from the standards the corporate management of the Company to explain the
reasons for the deviation and to disclose the m. During the reporting period, there were no deviations or indications
of possible deviations.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxiv
4. In addition to the above internal regulations, the Company has developed and operate effectively the
following corporate governance policies and documents:
(a). Rules of Activity of the Management Board and the Supervisory Board (hereinafter referred to as „MB”
and „SB ”, respectively) ;
(b). Internal control and risk management systems, and financial and information system;
(c). Remuneration policy applicable to the members of MB and SB; and
(d) . Policy of diversity with respect to the governing, managing, and supervisory authorities of the Company.
During the Reporting period, there were no deviations from the requirements of the se company regulations.
5. The Company has implemented a Quality Management System according to ISO 9001:2015 system
standard. The system guarantees a much better quality through the continuous improvement of process
management.
III. Internal control system
6. The Company has developed and implemented an internal control system. The operating activity in this
field is entrusted to a specialist internal group unit – Internal Audit Department, which is part of the structure of
the majority shareholder, KORADO a.s., Czech Republic, and performs the Group’s activity. The activities are
subject to an audit plan prepared annually, which contains a description of the envisaged audit engagements in
terms of: scope, duration, organisers and participants in the engagement; and estimated results. the Internal Audit
Department prepares a report on the completed audit engagement, which contains the main findings, proposed
corrective measures and the subsequent activities to be carried out after the audit completion.
The Internal Audit Department reports on its activity to the Audit Committee of the Company. The reporting is
carried out on an ongoing basis at the regular and extraordinary meetings of the Audit Committee. The summarized
findings of the Audit Committee from the reporting of the Internal Audit Department are included in the annual
report on the activity of the Audit Committee, which is prepared and submitted to the General Meeting of
Shareholders of the Company for approval (hereinafter referred to as the „GMS” ).
7. In the process of financial reporting for the Reporting period, the internal control takes the form of stock
taking /check-ups of inventories, work in progress, and cash, which are carried out regularly (on a monthly or
quarterly basis). At the end of every financial year, the balances of the Company – receivables and payables, are
checked-up as well. Accounting adjustments are made currently, according to the inventory lists expressed in
values.
8. The internal control system has been organised and implemented in such a way as to ensure, to the extent
necessary, that:
• the Company adheres to the statutory accounting requirements, observing the applicable legislation and
accounting standards, and during the reporting period these are the International Financial Reporting Standards
adopted for implementation in the European Union;
• the necessary level of awareness of the relevant addressees of financial information is ensured and
maintained;
• the relevant transparency and completeness requirements of financial information and the principle of
documentary reasoning are complied with; and
• a set of basic principles are respected by persons engaged in financial accounting, including objectivity,
impartiality, independence and transparency.
9. In general, the internal control system ensures efficient reporting and disclosure of information in view of
identifying the risks inherent to the Company’s activity.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxiv
4. In addition to the above internal regulations, the Company has developed and operate effectively the
following corporate governance policies and documents:
(a). Rules of Activity of the Management Board and the Supervisory Board (hereinafter referred to as „MB”
and „SB ”, respectively) ;
(b). Internal control and risk management systems, and financial and information system;
(c). Remuneration policy applicable to the members of MB and SB; and
(d) . Policy of diversity with respect to the governing, managing, and supervisory authorities of the Company.
During the Reporting period, there were no deviations from the requirements of the se company regulations.
5. The Company has implemented a Quality Management System according to ISO 9001:2015 system
standard. The system guarantees a much better quality through the continuous improvement of process
management.
III. Internal control system
6. The Company has developed and implemented an internal control system. The operating activity in this
field is entrusted to a specialist internal group unit – Internal Audit Department, which is part of the structure of
the majority shareholder, KORADO a.s., Czech Republic, and performs the Group’s activity. The activities are
subject to an audit plan prepared annually, which contains a description of the envisaged audit engagements in
terms of: scope, duration, organisers and participants in the engagement; and estimated results. the Internal Audit
Department prepares a report on the completed audit engagement, which contains the main findings, proposed
corrective measures and the subsequent activities to be carried out after the audit completion.
The Internal Audit Department reports on its activity to the Audit Committee of the Company. The reporting is
carried out on an ongoing basis at the regular and extraordinary meetings of the Audit Committee. The summarized
findings of the Audit Committee from the reporting of the Internal Audit Department are included in the annual
report on the activity of the Audit Committee, which is prepared and submitted to the General Meeting of
Shareholders of the Company for approval (hereinafter referred to as the „GMS” ).
7. In the process of financial reporting for the Reporting period, the internal control takes the form of stock
taking /check-ups of inventories, work in progress, and cash, which are carried out regularly (on a monthly or
quarterly basis). At the end of every financial year, the balances of the Company – receivables and payables, are
checked-up as well. Accounting adjustments are made currently, according to the inventory lists expressed in
values.
8. The internal control system has been organised and implemented in such a way as to ensure, to the extent
necessary, that:
• the Company adheres to the statutory accounting requirements, observing the applicable legislation and
accounting standards, and during the reporting period these are the International Financial Reporting Standards
adopted for implementation in the European Union;
• the necessary level of awareness of the relevant addressees of financial information is ensured and
maintained;
• the relevant transparency and completeness requirements of financial information and the principle of
documentary reasoning are complied with; and
• a set of basic principles are respected by persons engaged in financial accounting, including objectivity,
impartiality, independence and transparency.
9. In general, the internal control system ensures efficient reporting and disclosure of information in view of
identifying the risks inherent to the Company’s activity.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxv
IV. Risk management system
10. The Company has developed and implemented a risk management system. The operating activity in this
field is entrusted to a specialist internal group unit – Risk Management Department, which is part of the structure
of the majority shareholder, KORADO a.s., Czech Republic, and performs the Group’s activity. The activity
consists of identification, measurement and assessment of risks inherent to the Company’s operations. It shall also
ensure the effective functioning of the reporting and disclosure activities. The Risk Management Department
prepares a report on the assessment and reports on its activity to the Audit Committee at its regular and
extraordinary meetings. The summarized findings of the Audit Committee from the reporting of the Department
are included in the annual report on the activity of the Audit Committee.
11. In making its investment decision the corporate management of the Company aims at improving the
operational and financial stability of the Company, and achieving a validity by employing the results of current
and future risk analyses.
V. Composition and functioning of the administrative, management and supervisory bodies and
committee
12. The Company has a two-tier system of governance and strictly adheres to the principles of transparency,
independence and liability of the corporate management. This system includes the following bodies:
• SB comprises 4 (four) members, including 2 /two/ independent members in accordance with the
requirements of Article 116a, paragraph 2 of POSA. SB operates in compliance with the Articles of Association
of the Company and the Rules of Activity of the SB.
• MB comprises 3 (three) members. MB operates in compliance with the Articles of Association of the
Company and the Rules of Activity of the MB.
13. The SB and MB are structured in a way that guarantees the professionalism, impartiality and
independence of the decisions and actions of their members in relation to the governance and control of the
management of the Company.
14. The MB and SB ensure a proper segregation of the functions and responsibilities of their members,
subject to the principle of equal right and under the legal requirements, as well as effective participation in the
management of the Company in accordance with the interests and rights of shareholders.
15. The members of the MB and SB are elected in a transparent manner, providing timely information
insufficient capacity on the personal and professional qualities of each candidate for a member of the Board in
order to ensure that the relevant competent body of the Company will make an informed decision.
16. If a proposal for the election of a new member of the Board is made, the principles of compliance and
competence of applicants with the nature of the Company's activities and the nature of the functions and /or powers
assigned are respected.
17. The members of the MB and SB of the Company have the necessary qualifications, knowledge and
experience to perform properly, in compliance with the highest professional standards, their obligations. The
Company stimulates the qualification upgrading of the members of the MB and SB, and when a new member is to
be elected, he/she is acquainted with the Company's overall activity, its financial performance and the main legal
aspects related to business operations.
18. In their activity, the members of SB and MB apply the principle of avoidance and prevention of any real
or potential conflicts of interest. Moreover, they are obliged to immediately disclose a conflict of interest and to
provide shareholders with information about transactions between Company and a Board member or his/her related
parties. The procedure for the avoidance and disclosure of conflicts of interest is governed by the regulations
enumerated in clauses 2-4 of the Statement.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxv
IV. Risk management system
10. The Company has developed and implemented a risk management system. The operating activity in this
field is entrusted to a specialist internal group unit – Risk Management Department, which is part of the structure
of the majority shareholder, KORADO a.s., Czech Republic, and performs the Group’s activity. The activity
consists of identification, measurement and assessment of risks inherent to the Company’s operations. It shall also
ensure the effective functioning of the reporting and disclosure activities. The Risk Management Department
prepares a report on the assessment and reports on its activity to the Audit Committee at its regular and
extraordinary meetings. The summarized findings of the Audit Committee from the reporting of the Department
are included in the annual report on the activity of the Audit Committee.
11. In making its investment decision the corporate management of the Company aims at improving the
operational and financial stability of the Company, and achieving a validity by employing the results of current
and future risk analyses.
V. Composition and functioning of the administrative, management and supervisory bodies and
committee
12. The Company has a two-tier system of governance and strictly adheres to the principles of transparency,
independence and liability of the corporate management. This system includes the following bodies:
• SB comprises 4 (four) members, including 2 /two/ independent members in accordance with the
requirements of Article 116a, paragraph 2 of POSA. SB operates in compliance with the Articles of Association
of the Company and the Rules of Activity of the SB.
• MB comprises 3 (three) members. MB operates in compliance with the Articles of Association of the
Company and the Rules of Activity of the MB.
13. The SB and MB are structured in a way that guarantees the professionalism, impartiality and
independence of the decisions and actions of their members in relation to the governance and control of the
management of the Company.
14. The MB and SB ensure a proper segregation of the functions and responsibilities of their members,
subject to the principle of equal right and under the legal requirements, as well as effective participation in the
management of the Company in accordance with the interests and rights of shareholders.
15. The members of the MB and SB are elected in a transparent manner, providing timely information
insufficient capacity on the personal and professional qualities of each candidate for a member of the Board in
order to ensure that the relevant competent body of the Company will make an informed decision.
16. If a proposal for the election of a new member of the Board is made, the principles of compliance and
competence of applicants with the nature of the Company's activities and the nature of the functions and /or powers
assigned are respected.
17. The members of the MB and SB of the Company have the necessary qualifications, knowledge and
experience to perform properly, in compliance with the highest professional standards, their obligations. The
Company stimulates the qualification upgrading of the members of the MB and SB, and when a new member is to
be elected, he/she is acquainted with the Company's overall activity, its financial performance and the main legal
aspects related to business operations.
18. In their activity, the members of SB and MB apply the principle of avoidance and prevention of any real
or potential conflicts of interest. Moreover, they are obliged to immediately disclose a conflict of interest and to
provide shareholders with information about transactions between Company and a Board member or his/her related
parties. The procedure for the avoidance and disclosure of conflicts of interest is governed by the regulations
enumerated in clauses 2-4 of the Statement.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxvi
V. Composition and functioning of the administrative, management and supervisory bodies and
committee (continued)
19. The members of the MB and SB should fulfill their obligations with the care of responsible merchant
ship, in a manner that the y believe is in the interest of all shareholders of the Company, and to prefer the interests
of the Company and shareholders and /or investors in the Company to their own interests. The members of the
MB and SB should avoid direct or indirect conflicts between their own interest and the interest of the Company
or, should any such conflicts arise, to disclose the said conflicts promptly and fully in writing to the competent
body and not participating nor exerting influence on the rest of the members of the SB, and respectively the MB,
indecision-making in such cases.
20. The members of the MB and SB are obliged to protect Company's trade secrets and not to disclose non-
public information even after they cease to be members of the relevant bodies until public disclosure of the relevant
circumstances by the Company.
21. In compliance with the requirements of article 114b, paragraph 1 of the Public Offering of Securities Act,
the members of the MB and SB are obligated to disclose to the Company, as well as to the Financial Supervision
Commission and Bulgarian Stock Exchange-Sofia, information regarding:
• The legal persons where in the said persons hold, directly or indirectly, at least25 percent of the voting
rightsin the General Meeting or which the said persons control;
• The legal persons where of the said persons are members of the management bodies or supervisory bodies
or managerial agents;
• Any current and future transactions of which they are aware and in which, in their opinion, the said
persons may be treated as interested parties.
22. The MB and SB convene at regular meetings at least once every three months. Incompliance with the
requirements of the law and Articles of Association of the Company, MB and SB may also take their resolutions
non-attended.
23. Minutes shall be drawn up for all decisions of the MB and SB, which shall be signed by the members of
the relevant board who have attended the meeting (in the case of resolutions attended), respectively by all members
of the relevant board (in case of resolutions non-attended). The minutes shall be recorded and kept by the Investors
Relation Director of the Company, who is responsible for their accuracy and completeness.
24. The minutes of MB and SB meetings shall constitute a trade secret. Facts and circumstances thereof may
be published, disclosed or presented in any way to the knowledge of third parties/outside the members of the SB
only incompliance with a statutory requirement or by a decision of the MB and respectively, of the SB.
25. The SB shall be entitled to authorize one or more of its members to participate in meetings of the MB of
the Company, and to receive materials and information identical to that of the members of the MB. The SB may
at any time ask the MB to provide information or report on any matter affecting the Company. The SB, at least
once every three months, listens to a report of the MB on the Company's activities.
26. The members of the MB and SB are obliged to lodge a management guarantee within seven days of their
election. The amount of the guarantee is determined by the General Meeting of Shareholders and may not be less
than the 3-month gross remuneration of the relevant member of the MB, respectively the SB.
27. The Audit Committee is a specialized, mandatory for the Company body, which has its own operational
rules and work schedule. Its activity aims improving effectiveness of financial reporting processes, internal control
systems and risk management. The Audit Committee makes a substantiated proposal to the General Meeting of
Shareholders for the election of an external auditor and monitors the independent financial audit of the Company.
28. At 31 December 2023 the Audit Committee consists of three persons.
29. The members of the Audit Committee have the necessary qualifications and professional expertise to
perform properly, in compliance with corporate governance best practices, their functions.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxvi
V. Composition and functioning of the administrative, management and supervisory bodies and
committee (continued)
19. The members of the MB and SB should fulfill their obligations with the care of responsible merchant
ship, in a manner that the y believe is in the interest of all shareholders of the Company, and to prefer the interests
of the Company and shareholders and /or investors in the Company to their own interests. The members of the
MB and SB should avoid direct or indirect conflicts between their own interest and the interest of the Company
or, should any such conflicts arise, to disclose the said conflicts promptly and fully in writing to the competent
body and not participating nor exerting influence on the rest of the members of the SB, and respectively the MB,
indecision-making in such cases.
20. The members of the MB and SB are obliged to protect Company's trade secrets and not to disclose non-
public information even after they cease to be members of the relevant bodies until public disclosure of the relevant
circumstances by the Company.
21. In compliance with the requirements of article 114b, paragraph 1 of the Public Offering of Securities Act,
the members of the MB and SB are obligated to disclose to the Company, as well as to the Financial Supervision
Commission and Bulgarian Stock Exchange-Sofia, information regarding:
• The legal persons where in the said persons hold, directly or indirectly, at least25 percent of the voting
rightsin the General Meeting or which the said persons control;
• The legal persons where of the said persons are members of the management bodies or supervisory bodies
or managerial agents;
• Any current and future transactions of which they are aware and in which, in their opinion, the said
persons may be treated as interested parties.
22. The MB and SB convene at regular meetings at least once every three months. Incompliance with the
requirements of the law and Articles of Association of the Company, MB and SB may also take their resolutions
non-attended.
23. Minutes shall be drawn up for all decisions of the MB and SB, which shall be signed by the members of
the relevant board who have attended the meeting (in the case of resolutions attended), respectively by all members
of the relevant board (in case of resolutions non-attended). The minutes shall be recorded and kept by the Investors
Relation Director of the Company, who is responsible for their accuracy and completeness.
24. The minutes of MB and SB meetings shall constitute a trade secret. Facts and circumstances thereof may
be published, disclosed or presented in any way to the knowledge of third parties/outside the members of the SB
only incompliance with a statutory requirement or by a decision of the MB and respectively, of the SB.
25. The SB shall be entitled to authorize one or more of its members to participate in meetings of the MB of
the Company, and to receive materials and information identical to that of the members of the MB. The SB may
at any time ask the MB to provide information or report on any matter affecting the Company. The SB, at least
once every three months, listens to a report of the MB on the Company's activities.
26. The members of the MB and SB are obliged to lodge a management guarantee within seven days of their
election. The amount of the guarantee is determined by the General Meeting of Shareholders and may not be less
than the 3-month gross remuneration of the relevant member of the MB, respectively the SB.
27. The Audit Committee is a specialized, mandatory for the Company body, which has its own operational
rules and work schedule. Its activity aims improving effectiveness of financial reporting processes, internal control
systems and risk management. The Audit Committee makes a substantiated proposal to the General Meeting of
Shareholders for the election of an external auditor and monitors the independent financial audit of the Company.
28. At 31 December 2023 the Audit Committee consists of three persons.
29. The members of the Audit Committee have the necessary qualifications and professional expertise to
perform properly, in compliance with corporate governance best practices, their functions.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxvii
VI. Remuneration of the members of the MB and SB
30. In accordance with the legal requirements and the normal corporate governance standards adopted, the
amount and structure of remuneration determined in accordance with the Remuneration policy of the members of
the MB and SB shall take into consideration:
• The obligations, responsibilities and contribution of each of the members of the Boards to the activities
and performance of the Company;
• The qualifications and professional experience of the Board members and the need to retain in the
Company the most qualified and loyal members;
• The need to match the interests of the Board members with the long-term interests of the Company, with
remuneration being formed on the basis of Company's performance and in line with Company's business strategy,
objectives, values and long-term business plans;
• Remuneration and bonuses (to the extent applicable) of the members of the MB and SB are determined
by the GMS.
VII. Policy of diversity
31. The company shall devote the necessary efforts to prevent discrimination and to ensure equal
opportunities for recruitment, regardless of gender, race, nationality, ethnic origin, human genome, citizenship,
religion or belief, education, beliefs, political affiliation, personal or social situation, disability, age, sexual
orientation, family status, property situation or any other signs laid down in the applicable legislation.
32. The main criteria and principles of the Policy of diversity in the selection and assessment of the members
of the administrative, management and supervisory bodies of the Company are:
• members of these bodies can be natural persons and legal entities having legal capacity, without any
restrictions in terms of age, gender, nationality, education;
• only non-discriminatory criteria may be applied as requirements for the appointment of members of these
bodies, such as: good reputation, professional experience and managerial skills, depending on the complexity and
specifics of the Company’s operations; and
• The following are also among the goals for achieving compliance with the principles of diversity in the
Company’s management: independence and objectivity in expression of opinions, taking into account of maximum
wide scope of views and interests of a maximum wide range of social groups upon taking decisions, etc.
33. The Company complies with the principle of diversity with respect to the composition of its corporate
bodies. The MB of the Company, by its decision dated 1 March 2017, adopted a Policy of diversity.
34. No cases of discrimination were found in the Company during the reporting period.
VIII. Protection of shareholders’ rights
35. The corporate management of the Company guarantees equal treatment of all shareholders, including
minority and foreign shareholders, and protects their rights. All shareholders have the right to participate in the
GMS and to express their opinion in person or through proxies. The procedures and order of holding GMS
facilitates at maximum the shareholders and comply with the principle of undue obstruction or unnecessary
increase in costs. Actions shall be taken to encourage the participation of minority shareholders in the GMS. the
corporate management shall endeavor to provide at least one MB and SB representative to each GMS to provide
information to shareholders and to answer the questions raised in the field of his/her competence and in accordance
with the requirements of the law.
36. The shareholders have been informed of the rules of convocation and holding a GMS, and of the right
to add items to the agenda of a convened GMS and /or to make alternative proposals for a resolution on items
already included in the agenda, in strict compliance with any legal restrictions.
37. Materials on the agenda items shall be made available to the shareholders in a timely manner. These
materials shall be fair and clear as far as possible. Thus, it is guaranteed that informed decisions will be passed and
the shareholders will not be misled.
38. All shareholders of one class are treated equally.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxvii
VI. Remuneration of the members of the MB and SB
30. In accordance with the legal requirements and the normal corporate governance standards adopted, the
amount and structure of remuneration determined in accordance with the Remuneration policy of the members of
the MB and SB shall take into consideration:
• The obligations, responsibilities and contribution of each of the members of the Boards to the activities
and performance of the Company;
• The qualifications and professional experience of the Board members and the need to retain in the
Company the most qualified and loyal members;
• The need to match the interests of the Board members with the long-term interests of the Company, with
remuneration being formed on the basis of Company's performance and in line with Company's business strategy,
objectives, values and long-term business plans;
• Remuneration and bonuses (to the extent applicable) of the members of the MB and SB are determined
by the GMS.
VII. Policy of diversity
31. The company shall devote the necessary efforts to prevent discrimination and to ensure equal
opportunities for recruitment, regardless of gender, race, nationality, ethnic origin, human genome, citizenship,
religion or belief, education, beliefs, political affiliation, personal or social situation, disability, age, sexual
orientation, family status, property situation or any other signs laid down in the applicable legislation.
32. The main criteria and principles of the Policy of diversity in the selection and assessment of the members
of the administrative, management and supervisory bodies of the Company are:
• members of these bodies can be natural persons and legal entities having legal capacity, without any
restrictions in terms of age, gender, nationality, education;
• only non-discriminatory criteria may be applied as requirements for the appointment of members of these
bodies, such as: good reputation, professional experience and managerial skills, depending on the complexity and
specifics of the Company’s operations; and
• The following are also among the goals for achieving compliance with the principles of diversity in the
Company’s management: independence and objectivity in expression of opinions, taking into account of maximum
wide scope of views and interests of a maximum wide range of social groups upon taking decisions, etc.
33. The Company complies with the principle of diversity with respect to the composition of its corporate
bodies. The MB of the Company, by its decision dated 1 March 2017, adopted a Policy of diversity.
34. No cases of discrimination were found in the Company during the reporting period.
VIII. Protection of shareholders’ rights
35. The corporate management of the Company guarantees equal treatment of all shareholders, including
minority and foreign shareholders, and protects their rights. All shareholders have the right to participate in the
GMS and to express their opinion in person or through proxies. The procedures and order of holding GMS
facilitates at maximum the shareholders and comply with the principle of undue obstruction or unnecessary
increase in costs. Actions shall be taken to encourage the participation of minority shareholders in the GMS. the
corporate management shall endeavor to provide at least one MB and SB representative to each GMS to provide
information to shareholders and to answer the questions raised in the field of his/her competence and in accordance
with the requirements of the law.
36. The shareholders have been informed of the rules of convocation and holding a GMS, and of the right
to add items to the agenda of a convened GMS and /or to make alternative proposals for a resolution on items
already included in the agenda, in strict compliance with any legal restrictions.
37. Materials on the agenda items shall be made available to the shareholders in a timely manner. These
materials shall be fair and clear as far as possible. Thus, it is guaranteed that informed decisions will be passed and
the shareholders will not be misled.
38. All shareholders of one class are treated equally.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxviii
VIII. Protection of shareholders’ rights (continued)
39. In compliance with the requirements of article 114b, paragraph 1 of the Public Offering of Securities Act,
the persons holding, directly or indirectly, at least 25 percent of the votes in the General Meeting of the Company
or controlling the Company, are obligated to disclose to the Company, as well as to the Financial Supervision
Commission and Bulgarian Stock Exchange-Sofia, information regarding:
• the legal persons where in the said persons hold, directly or indirectly, at least 25 percent of the votes in
the General Meeting or which the said persons control;
• the legal persons where of the said persons are members of the management bodies or supervisory bodies
or managerial agents;
• any current and future transactions of which they are aware and in which, in their opinion, the said persons
may be treated as interested parties.
IX. Information disclosure system
40. The Information disclosure policy and system, approved by the Company, guarantee equality of the
information addressees (shareholders, stakeholders, investment society) and prevent abuses in the form of insider
dealing. The system for disclosure of information ensures complete, timely, true and understandable information,
which enables objective and informed decisions and valuations. The Company has implemented in-house rules for
the preparation of annual and interim reports, and disclosure procedure.
41. The system for disclosure of information ensures provision and /or disclosure of timely, correct and
understandable information in accordance with the requirements of the law and good corporate practices. The
system for disclosure of information ensures access to relevant, sufficient and reliable information about the
Company, as well as information about the decisions taken by the GMS.
42. The Company maintains its website. The investor section contains internal documents of the Company,
information about the shareholders’ rights and their participation in the General Meeting of Shareholders, the
financial statements for the last 10 years, information about the payment of dividends, as also for personal data
protection. This section also contains materials for the forthcoming General Meetings of Shareholders of the
Company and information on the decisions passed by the General Meeting of Shareholders.
43. Pursuant to the regulatory requirements, the Company has Investors Relation Director, who has been
appointed to ensure due disclosure of regulated information that must be disclosed, and to maintain active
communication with shareholders and /or investors in the Company.
44. The Company discloses regulated information that must be disclosed by providing it to the Financial
Supervision Commission, Bulgarian Stock Exchange– Sofia and Central Depository and making it available to the
general public through the information system of the portal www.X3news.com. Thus, information is disseminated
effectively and reaches simultaneously the widest possible range of people in a way that is not discriminatory to
them
45. The Company ensures adequate transparency regarding its commercial activities, financial results,
decisions made, and maintains its relationships with investors, media, financial and market analysis at professional
level.
X. Information on the existence of takeover/merger bids and according to Article 10, paragraph 1,
letters "c", "d", "f", "h" and "i" of Directive 2004/25/E C of the European Parliament and the Council of
21April 2004 on takeover bids
46. During the reporting period, takeover/merger bids were not sent to the Company.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxviii
VIII. Protection of shareholders’ rights (continued)
39. In compliance with the requirements of article 114b, paragraph 1 of the Public Offering of Securities Act,
the persons holding, directly or indirectly, at least 25 percent of the votes in the General Meeting of the Company
or controlling the Company, are obligated to disclose to the Company, as well as to the Financial Supervision
Commission and Bulgarian Stock Exchange-Sofia, information regarding:
• the legal persons where in the said persons hold, directly or indirectly, at least 25 percent of the votes in
the General Meeting or which the said persons control;
• the legal persons where of the said persons are members of the management bodies or supervisory bodies
or managerial agents;
• any current and future transactions of which they are aware and in which, in their opinion, the said persons
may be treated as interested parties.
IX. Information disclosure system
40. The Information disclosure policy and system, approved by the Company, guarantee equality of the
information addressees (shareholders, stakeholders, investment society) and prevent abuses in the form of insider
dealing. The system for disclosure of information ensures complete, timely, true and understandable information,
which enables objective and informed decisions and valuations. The Company has implemented in-house rules for
the preparation of annual and interim reports, and disclosure procedure.
41. The system for disclosure of information ensures provision and /or disclosure of timely, correct and
understandable information in accordance with the requirements of the law and good corporate practices. The
system for disclosure of information ensures access to relevant, sufficient and reliable information about the
Company, as well as information about the decisions taken by the GMS.
42. The Company maintains its website. The investor section contains internal documents of the Company,
information about the shareholders’ rights and their participation in the General Meeting of Shareholders, the
financial statements for the last 10 years, information about the payment of dividends, as also for personal data
protection. This section also contains materials for the forthcoming General Meetings of Shareholders of the
Company and information on the decisions passed by the General Meeting of Shareholders.
43. Pursuant to the regulatory requirements, the Company has Investors Relation Director, who has been
appointed to ensure due disclosure of regulated information that must be disclosed, and to maintain active
communication with shareholders and /or investors in the Company.
44. The Company discloses regulated information that must be disclosed by providing it to the Financial
Supervision Commission, Bulgarian Stock Exchange– Sofia and Central Depository and making it available to the
general public through the information system of the portal www.X3news.com. Thus, information is disseminated
effectively and reaches simultaneously the widest possible range of people in a way that is not discriminatory to
them
45. The Company ensures adequate transparency regarding its commercial activities, financial results,
decisions made, and maintains its relationships with investors, media, financial and market analysis at professional
level.
X. Information on the existence of takeover/merger bids and according to Article 10, paragraph 1,
letters "c", "d", "f", "h" and "i" of Directive 2004/25/E C of the European Parliament and the Council of
21April 2004 on takeover bids
46. During the reporting period, takeover/merger bids were not sent to the Company.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxix
X. Information on the existence of takeover/merger bids and according to Article 10, paragraph 1,
letters "c", "d", "f", "h" and "i" of Directive 2004/25/EC of the European Parliament and the Council of
21April 2004 on takeover bids (continued)
47. Information about direct or indirect significant shareholdings:
• The Company is controlled by KORADO, a.s., Czech Republic, a company holding 82.15% of the share
capital of the Company as at 31December 2023, or 10,817,923 shares.
• In turn, the majority shareholder of KORADO a.s. is the Ministry of Finance of the Czech Republic, and
other significant shareholders, such as the European Bank for Development and Reconstruction and 3 individuals.
• The only shareholder with significant shareholding is KORADO a.s., Czech Republic, a company
registered with the Register of the local court Hradec Králové, Section B, Batch 1500, Czech UIC 25255843.
• At 31 December 2023, 15.94 % (2,098,741 shares) of the Company’s capital is held by other legal entities
and 1.91% (251,950 shares) of the capital by other individuals; there are no other significant, direct or indirect
shareholdings which must be disclosed.
48. As at 31 December 2023, the Company held no shares in the capital of other entities.
XI. Information about the shareholders with special control rights and description of these rights
49. The Company has not issued shares with special control rights.
XII. Information about the limitations over the voting rights, such as limitations over the voting rights
of the shareholders with a given percent or number of votes, deadline for exercising the voting rights or
systems whereby with the company’s assistance, the financial rights attaching to the shares are separated
from the holding of shares.
50. The financial rights derived from the shares are indissolubly linked to the holding of shares. There are
no restrictions on the voting right, besides those imposed by the law as mandatory (such as non-exercising the
right to vote by a shareholder who is also a stakeholder in the case of transactions under Article 114 of POSA).
Votes are exercised only by open ballot (no secret ballots were held so far) at place where the session of the GMS
takes place. Until now, electronic means for remote participation within the meaning of Article115, paragraph 8 –
10 of POSA were not allowed.
XIII. Information about the provisions for the appointment and dismissal of the members of the
Company’s management bodies and about introduction of amendments to the articles of association
51. Members of the Supervisory Board are appointed and dismissed by the General Meeting of Shareholders
on the grounds of a decision passed by ordinary majority. Members of the Management Board are appointed and
dismissed by the SB of the Company on the grounds of a decision passed by ordinary majority.
52. A member of the MB and SB can be a natural person with legal capacity, as well as a legal entity. Where
a member of the MB and /or SB is a legal entity, it designates a representative(s) for the performance of its duties
in the board. If more than one representative has been appointed by a legal entity, only one of them participates in
the work of the MB and /or SB. The legal entity is jointly and unlimitedly liable together with the other members
of the board for the obligations arising from the actions of its representative.
53. The members of the MB and SB cannot be persons sentenced to imprisonment for willful crime of general
character, as well as persons, who at the time of their appointment were convicted by a final judgment for crime
against property, economy or against the financial, tax and social security systems committed in the Republic of
Bulgaria or abroad, unless they have been rehabilitated. A member of the MB and SB cannot be also a person,
who has been a member of an executive or supervisory body in a company, when it is terminated due to bankruptcy
in the past two years preceding the date of the resolution for bankruptcy, if there have been unsatisfied creditors
remaining; a person who has been a manager, member of a management or supervisory body of a company, for
which was established, through an effective administrative penalty deed, the non-performance of obligations for
accumulation and maintenance of the determined levels of reserves under the Bulgarian Oil and Oil Products
Reserves Act; and a person who does not meet the requirements of the Articles of Association of the Company.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxix
X. Information on the existence of takeover/merger bids and according to Article 10, paragraph 1,
letters "c", "d", "f", "h" and "i" of Directive 2004/25/EC of the European Parliament and the Council of
21April 2004 on takeover bids (continued)
47. Information about direct or indirect significant shareholdings:
• The Company is controlled by KORADO, a.s., Czech Republic, a company holding 82.15% of the share
capital of the Company as at 31December 2023, or 10,817,923 shares.
• In turn, the majority shareholder of KORADO a.s. is the Ministry of Finance of the Czech Republic, and
other significant shareholders, such as the European Bank for Development and Reconstruction and 3 individuals.
• The only shareholder with significant shareholding is KORADO a.s., Czech Republic, a company
registered with the Register of the local court Hradec Králové, Section B, Batch 1500, Czech UIC 25255843.
• At 31 December 2023, 15.94 % (2,098,741 shares) of the Company’s capital is held by other legal entities
and 1.91% (251,950 shares) of the capital by other individuals; there are no other significant, direct or indirect
shareholdings which must be disclosed.
48. As at 31 December 2023, the Company held no shares in the capital of other entities.
XI. Information about the shareholders with special control rights and description of these rights
49. The Company has not issued shares with special control rights.
XII. Information about the limitations over the voting rights, such as limitations over the voting rights
of the shareholders with a given percent or number of votes, deadline for exercising the voting rights or
systems whereby with the company’s assistance, the financial rights attaching to the shares are separated
from the holding of shares.
50. The financial rights derived from the shares are indissolubly linked to the holding of shares. There are
no restrictions on the voting right, besides those imposed by the law as mandatory (such as non-exercising the
right to vote by a shareholder who is also a stakeholder in the case of transactions under Article 114 of POSA).
Votes are exercised only by open ballot (no secret ballots were held so far) at place where the session of the GMS
takes place. Until now, electronic means for remote participation within the meaning of Article115, paragraph 8 –
10 of POSA were not allowed.
XIII. Information about the provisions for the appointment and dismissal of the members of the
Company’s management bodies and about introduction of amendments to the articles of association
51. Members of the Supervisory Board are appointed and dismissed by the General Meeting of Shareholders
on the grounds of a decision passed by ordinary majority. Members of the Management Board are appointed and
dismissed by the SB of the Company on the grounds of a decision passed by ordinary majority.
52. A member of the MB and SB can be a natural person with legal capacity, as well as a legal entity. Where
a member of the MB and /or SB is a legal entity, it designates a representative(s) for the performance of its duties
in the board. If more than one representative has been appointed by a legal entity, only one of them participates in
the work of the MB and /or SB. The legal entity is jointly and unlimitedly liable together with the other members
of the board for the obligations arising from the actions of its representative.
53. The members of the MB and SB cannot be persons sentenced to imprisonment for willful crime of general
character, as well as persons, who at the time of their appointment were convicted by a final judgment for crime
against property, economy or against the financial, tax and social security systems committed in the Republic of
Bulgaria or abroad, unless they have been rehabilitated. A member of the MB and SB cannot be also a person,
who has been a member of an executive or supervisory body in a company, when it is terminated due to bankruptcy
in the past two years preceding the date of the resolution for bankruptcy, if there have been unsatisfied creditors
remaining; a person who has been a manager, member of a management or supervisory body of a company, for
which was established, through an effective administrative penalty deed, the non-performance of obligations for
accumulation and maintenance of the determined levels of reserves under the Bulgarian Oil and Oil Products
Reserves Act; and a person who does not meet the requirements of the Articles of Association of the Company.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxx
XIII. Information about the provisions for the appointment and dismissal of the members of the
Company’s management bodies and about introduction of amendments to the articles of association
(continued)
54. The natural persons who represent the legal entities – members of the MB and /or SB must comply with
the requirements applicable to a member of SB and MB.
55. One and the same person cannot a member of the SB and the MB, at the same time.
56. At least 1/3 of the members of the SB must be independent persons. the independent member of the SB
cannot be:
• an employee of a public company;
• a shareholder, who holds, directly or through related parties, at least 25 percent of the votes in the General
Meeting or is related party to the Company;
• a person, who has secret relations with the public company; a member of a management or supervisory
body, managerial agent or employee of a commercial company or another legal person under items2 and 3;
• a related party to another member of a management or supervisory body of the public company.
57. The members of the MB and SB may be re-elected without limitation.
58. The General Meeting of Shareholders is the body exclusively competent to amend and supplement the
Articles of Association of the Company. In accordance with the law and Articles of Association of the Company,
the required majority to pass such a decision is equal to 2/3 of the voting shares presented or represented at the
GMS meeting.
XIV. Information on the powers of the Board members, in particular the right to issue and redeem (buy-
back) shares
59. The share capital of the Company amounts to BGN 13,168,614 at 31 December 2023, split into
13,168,614 dematerialized, registered, voting shares with nominal value of BGN 1 each. All shares are of one
class. All shares of the Company provide equal rights to their holders. A share gives the right to one vote in GMS,
right to dividend and liquidation share proportionate to the share’s nominal value.
60. According to the requirements of the Articles of Association and the effective legislation, the decision to
issue or buy-back shares is among the powers of the GMS. During the Reporting period, shares, share options or
other financial instruments, envisaged to be provided to or to be subscribed by Board members or key personnel,
were not issued by the Company. Shares with buy-back reference were not issued by the Company.
61. According to the Company’s Articles of Association, the General Meeting of Shareholders of the
Company has the exclusive power to take decisions on share buy-backs. The decision shall be registered with the
Commercial Register. The majority required to pass such a decision is equal to1/2 of the voting shares presented
or represented at the GMS meeting.
XV. Disclosure of financial and non-financial information.
62. The Management Board shall implement the policy for disclosure of information in accordance with the
law requirements and bylaws.
63. In accordance with this policy under item 1, the Management Board uses a system for disclosure of financial
and non-financial information.
64. The financial and non-financial disclosure system seeks to ensure equality of the addressees of the information
(shareholders, stakeholders, investment community) and to prevent the misuse of inside information.
65. The Management Board shall endeavor to ensure that the financial and non-financial disclosure system
information provides complete, timely, accurate and understandable information that enables objective and
informed decisions and assessments.
66. The Management Board shall promptly disclose the capital structure of the Company and agreements leading
to controls under its disclosure rules information and current legislation.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxx
XIII. Information about the provisions for the appointment and dismissal of the members of the
Company’s management bodies and about introduction of amendments to the articles of association
(continued)
54. The natural persons who represent the legal entities – members of the MB and /or SB must comply with
the requirements applicable to a member of SB and MB.
55. One and the same person cannot a member of the SB and the MB, at the same time.
56. At least 1/3 of the members of the SB must be independent persons. the independent member of the SB
cannot be:
• an employee of a public company;
• a shareholder, who holds, directly or through related parties, at least 25 percent of the votes in the General
Meeting or is related party to the Company;
• a person, who has secret relations with the public company; a member of a management or supervisory
body, managerial agent or employee of a commercial company or another legal person under items2 and 3;
• a related party to another member of a management or supervisory body of the public company.
57. The members of the MB and SB may be re-elected without limitation.
58. The General Meeting of Shareholders is the body exclusively competent to amend and supplement the
Articles of Association of the Company. In accordance with the law and Articles of Association of the Company,
the required majority to pass such a decision is equal to 2/3 of the voting shares presented or represented at the
GMS meeting.
XIV. Information on the powers of the Board members, in particular the right to issue and redeem (buy-
back) shares
59. The share capital of the Company amounts to BGN 13,168,614 at 31 December 2023, split into
13,168,614 dematerialized, registered, voting shares with nominal value of BGN 1 each. All shares are of one
class. All shares of the Company provide equal rights to their holders. A share gives the right to one vote in GMS,
right to dividend and liquidation share proportionate to the share’s nominal value.
60. According to the requirements of the Articles of Association and the effective legislation, the decision to
issue or buy-back shares is among the powers of the GMS. During the Reporting period, shares, share options or
other financial instruments, envisaged to be provided to or to be subscribed by Board members or key personnel,
were not issued by the Company. Shares with buy-back reference were not issued by the Company.
61. According to the Company’s Articles of Association, the General Meeting of Shareholders of the
Company has the exclusive power to take decisions on share buy-backs. The decision shall be registered with the
Commercial Register. The majority required to pass such a decision is equal to1/2 of the voting shares presented
or represented at the GMS meeting.
XV. Disclosure of financial and non-financial information.
62. The Management Board shall implement the policy for disclosure of information in accordance with the
law requirements and bylaws.
63. In accordance with this policy under item 1, the Management Board uses a system for disclosure of financial
and non-financial information.
64. The financial and non-financial disclosure system seeks to ensure equality of the addressees of the information
(shareholders, stakeholders, investment community) and to prevent the misuse of inside information.
65. The Management Board shall endeavor to ensure that the financial and non-financial disclosure system
information provides complete, timely, accurate and understandable information that enables objective and
informed decisions and assessments.
66. The Management Board shall promptly disclose the capital structure of the Company and agreements leading
to controls under its disclosure rules information and current legislation.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxxi
XV. Disclosure of financial and non-financial information. (continued)
67. The Management Board shall approve and control the observance of internal rules for preparation of the
annual and interim reports and the procedure for disclosing information.
68. The Management Board shall use internal rules to ensure the timely disclosure of any material periodic and
incidental information concerning the Company, its management, its corporate management, its operational
activities, its shareholder structure.
69. Where applicable, the Management Board shall apply rules that ensure disclosure of annual basis of non –
financial information in accordance with national law; and applicable European law. In this regard, the
Management Board is making efforts to include its annual reports information on how and to what extent the
Company's activities can be qualify as environmentally sustainable, such as: what part of its turnover is the result
of products and services that relate to economic activities that qualify as environmentally sustainable; what part of
its capital expenditure, where applicable, and what part of operating costs are related to assets or processes related
to economic activities that qualify as environmentally sustainable.
70. The Company, as part of the disclosure system, has developed and maintains website of the Company approved
content, scope and periodicity of the disclosed through it information.
The information disclosed through the Company's website includes at least:
- basic information identifying the Company and its business model;
- up-to-date information on the shareholder structure;
- the by-laws of the Company and the adopted policies related to the activity and the functioning of the
Company;
- information on the structure and composition of the management and control bodies of the Company, as well
as basic information about their members, including information about the Audit committee;
- financial statements for the last 10 years;
- the materials for the forthcoming general meetings of the shareholders of the Company.
Information on the decisions taken by the general meetings of shareholders for at least the last five years, incl.
information on the dividends distributed by the Company for this period;
- information on auditors;
- information about upcoming events;
- information on issued shares and o the r financial instruments;
- important information related to the Company's activities;
- information on the rights of the shareholders, incl. sufficient information on the right to shareholders to request
the inclusion of issues and to propose solutions to issues already included in the agenda of the general meeting by
the order of art. 223a of the Commercial Law;
- contact information for the Investor Relations Director of the Company.
71. The Company also maintains an English language version of the corporate website with similar content.
72. The Company periodically discloses information about corporate governance. The disclosure on information
on corporate governance is in accordance with the "comply or explain" principle.
All recommendations of the Code are followed.
XVI. Stakeholders. Sustainable Development.
73. Sustainable development aims to meet the needs of the current generation without exposing at risk the ability
of future generations to meet their own needs.
74. The Management Board is committed to identifying specific actions for sustainable development of the
Company
75. The Management Board shall ensure effective interaction with stakeholders. To the group of the interested
parties refer to certain groups of persons on whom the Company directly influences an which in turn may affect
its activities, including suppliers, customers, employees, creditors, etc.
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxxi
XV. Disclosure of financial and non-financial information. (continued)
67. The Management Board shall approve and control the observance of internal rules for preparation of the
annual and interim reports and the procedure for disclosing information.
68. The Management Board shall use internal rules to ensure the timely disclosure of any material periodic and
incidental information concerning the Company, its management, its corporate management, its operational
activities, its shareholder structure.
69. Where applicable, the Management Board shall apply rules that ensure disclosure of annual basis of non –
financial information in accordance with national law; and applicable European law. In this regard, the
Management Board is making efforts to include its annual reports information on how and to what extent the
Company's activities can be qualify as environmentally sustainable, such as: what part of its turnover is the result
of products and services that relate to economic activities that qualify as environmentally sustainable; what part of
its capital expenditure, where applicable, and what part of operating costs are related to assets or processes related
to economic activities that qualify as environmentally sustainable.
70. The Company, as part of the disclosure system, has developed and maintains website of the Company approved
content, scope and periodicity of the disclosed through it information.
The information disclosed through the Company's website includes at least:
- basic information identifying the Company and its business model;
- up-to-date information on the shareholder structure;
- the by-laws of the Company and the adopted policies related to the activity and the functioning of the
Company;
- information on the structure and composition of the management and control bodies of the Company, as well
as basic information about their members, including information about the Audit committee;
- financial statements for the last 10 years;
- the materials for the forthcoming general meetings of the shareholders of the Company.
Information on the decisions taken by the general meetings of shareholders for at least the last five years, incl.
information on the dividends distributed by the Company for this period;
- information on auditors;
- information about upcoming events;
- information on issued shares and o the r financial instruments;
- important information related to the Company's activities;
- information on the rights of the shareholders, incl. sufficient information on the right to shareholders to request
the inclusion of issues and to propose solutions to issues already included in the agenda of the general meeting by
the order of art. 223a of the Commercial Law;
- contact information for the Investor Relations Director of the Company.
71. The Company also maintains an English language version of the corporate website with similar content.
72. The Company periodically discloses information about corporate governance. The disclosure on information
on corporate governance is in accordance with the "comply or explain" principle.
All recommendations of the Code are followed.
XVI. Stakeholders. Sustainable Development.
73. Sustainable development aims to meet the needs of the current generation without exposing at risk the ability
of future generations to meet their own needs.
74. The Management Board is committed to identifying specific actions for sustainable development of the
Company
75. The Management Board shall ensure effective interaction with stakeholders. To the group of the interested
parties refer to certain groups of persons on whom the Company directly influences an which in turn may affect
its activities, including suppliers, customers, employees, creditors, etc.
KORADO-BULGARIA AD
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxxii
XVI. Stakeholders. Sustainable Development. (continued)
The Company identifies the interested parties in relation to its activities based on their degree and spheres of
influence, role and attitude towards its sustainable development.
76. The Management Board shall ensure respect for the rights of the persons concerned, established by law or by
mutual agreement with the company, guided by the understanding that good corporate governance practice requires
compliance with stakeholder’s according with the principles of transparency, accountability and business ethics
and protection of human rights.
77. The Management Board shall ensure that all stakeholders are adequately informed about their legally
established rights.
78. The Management Board shall maintain effective relations with stakeholders.
79. The Management Board shall guarantee the right of timely and regular access to relevant, sufficient and reliable
information about the Company when stakeholders are involved in the process corporate management.
XVII. Miscellaneous
80. The Company participates actively in various forms of mutual cooperation whit government institutions
and non-government organizations on corporate government matters.
The process of information disclosure by the Company is subject to multiple controls. So far, violations of the
provisions and forms of disclosure have been established. The financial statements are published on the Company's
website immediately after the y have been forwarded to the regulatory authority and the public, thus providing for
controls by shareholders, investors and all stakeholders.
81. This declaration has been prepared and adopted on the basis of the current provisions of the National
Corporate Governance Code from BSE-Sofia, which is mandatory for public companies, whose shares are traded
on an official market adopted in October 2007. The Code was approved by the National Commission for Corporate
Governance and subsequently amended in February 2012, April 2016 and July 1, 2021.
For KORADO – Bulgaria AD
__________________________
Jiri Reznicek
CORPORATE GOVERNANCE STATEMENT (CONTINUED)
31 December 2023
xxxii
XVI. Stakeholders. Sustainable Development. (continued)
The Company identifies the interested parties in relation to its activities based on their degree and spheres of
influence, role and attitude towards its sustainable development.
76. The Management Board shall ensure respect for the rights of the persons concerned, established by law or by
mutual agreement with the company, guided by the understanding that good corporate governance practice requires
compliance with stakeholder’s according with the principles of transparency, accountability and business ethics
and protection of human rights.
77. The Management Board shall ensure that all stakeholders are adequately informed about their legally
established rights.
78. The Management Board shall maintain effective relations with stakeholders.
79. The Management Board shall guarantee the right of timely and regular access to relevant, sufficient and reliable
information about the Company when stakeholders are involved in the process corporate management.
XVII. Miscellaneous
80. The Company participates actively in various forms of mutual cooperation whit government institutions
and non-government organizations on corporate government matters.
The process of information disclosure by the Company is subject to multiple controls. So far, violations of the
provisions and forms of disclosure have been established. The financial statements are published on the Company's
website immediately after the y have been forwarded to the regulatory authority and the public, thus providing for
controls by shareholders, investors and all stakeholders.
81. This declaration has been prepared and adopted on the basis of the current provisions of the National
Corporate Governance Code from BSE-Sofia, which is mandatory for public companies, whose shares are traded
on an official market adopted in October 2007. The Code was approved by the National Commission for Corporate
Governance and subsequently amended in February 2012, April 2016 and July 1, 2021.
For KORADO – Bulgaria AD
__________________________
Jiri Reznicek
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxiii
REPORT
ON THE IMPLEMENTATION OF THE POLICY ON THE REMUNERATION OF THE MEMBERS
OF THE SUPERVISORY BOARD, THE MANAGEMENT BOARD AND THE AUDIT COMMITTEE
OF KORADO - BULGARIA AD FOR THE YEAR 2022
1. INTRODUCTION
1.1. Legal Grounds of the Report
During the period January 1, 2023 - December 31, 2023 (hereinafter referred to as the “Reporting Period”),
KORADO- Bulgaria AD (hereinafter referred to as the “Company”) applied the Remuneration Policy of the
members of the Supervisory Board, the Management Board and the Audit Committee of the Company, approved
in its current version by the General Meeting of the Company (hereinafter referred to as the “General Meeting”),
held on May 13, 2015, a new version adopted by decision of the General Meeting of the Company, held on 19 05.
2021 and respectively partially amended by a decision of the General Meeting of the Company, held on 15. 09.
2021 and published on the Internet at the following address: www.korado.bg (hereinafter "the Policy").
This present report was prepared by the Management Board of the Company (hereinafter referred to as the “MB” )
in execution of the requirement of Art. 12, Par. 1 of Ordinance No. 48 of 20 March 2013 on the Requirements to
Remuneration issued by the Financial Supervision Commission (hereinafter referred to as “Ordinance No. 48” ).
The Report constitutes a separate document appended to the Annual Financial Statements of the Company for the
year 2023. The Report is presented to the attention of the shareholders of the Company and could be discussed on
with the members of the MB at the regular annual session of the General Meeting of the Shareholders of the
Company.
1.2. Subject-Matter and Scope of the Report
In accordance with Art. 12, Par. 2 of Ordinance 48, the Report consists of:
(a). review of the manner of implementation of the Policy during the Reported Period; and
(b). programme on the implementation of the Policy during the period 1 January 2024 –
31 December 2024.
Furthermore, the Report also contains all of the mandatory requisites pursuant to Art. 13 of
Ordinance No. 48.
Given the repeal of the existing policy by a decision of the General Meeting of Shareholders held on
19 May 2021 and its amendment by a decision of the General Meeting of Shareholders held on
15 September 2021 and both amendments before the reporting period, the Report contains the necessary
information on adopted amendments.
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD
2.1. Information about the process of adopting resolutions upon the determination of the Policy
In accordance with Art. 116e, Par. 1 of the POSA, the Articles of Association of the Company and the Policy, the
determination of the amount of the remuneration of the members of the MB, the members of the Supervisory Board
of the Company (hereinafter referred to as the “SB” ) and of the members of the Audit Committee of the Company
(referred to hereinafter as the “AC” ), their right to receive a portion of the profit, as well as their right to acquire
shares or debt instruments of the Company, are within the competence of the General Meeting.
Pursuant to the Policy, the remuneration of the members of the MB, SB and AC is determined by a resolution of
the General Meeting. The Policy does not envisage the creation of a permanent Remuneration Committee of the
Company as an optional body.
REMUNERATION REPORT
31 December 2023
xxxiii
REPORT
ON THE IMPLEMENTATION OF THE POLICY ON THE REMUNERATION OF THE MEMBERS
OF THE SUPERVISORY BOARD, THE MANAGEMENT BOARD AND THE AUDIT COMMITTEE
OF KORADO - BULGARIA AD FOR THE YEAR 2022
1. INTRODUCTION
1.1. Legal Grounds of the Report
During the period January 1, 2023 - December 31, 2023 (hereinafter referred to as the “Reporting Period”),
KORADO- Bulgaria AD (hereinafter referred to as the “Company”) applied the Remuneration Policy of the
members of the Supervisory Board, the Management Board and the Audit Committee of the Company, approved
in its current version by the General Meeting of the Company (hereinafter referred to as the “General Meeting”),
held on May 13, 2015, a new version adopted by decision of the General Meeting of the Company, held on 19 05.
2021 and respectively partially amended by a decision of the General Meeting of the Company, held on 15. 09.
2021 and published on the Internet at the following address: www.korado.bg (hereinafter "the Policy").
This present report was prepared by the Management Board of the Company (hereinafter referred to as the “MB” )
in execution of the requirement of Art. 12, Par. 1 of Ordinance No. 48 of 20 March 2013 on the Requirements to
Remuneration issued by the Financial Supervision Commission (hereinafter referred to as “Ordinance No. 48” ).
The Report constitutes a separate document appended to the Annual Financial Statements of the Company for the
year 2023. The Report is presented to the attention of the shareholders of the Company and could be discussed on
with the members of the MB at the regular annual session of the General Meeting of the Shareholders of the
Company.
1.2. Subject-Matter and Scope of the Report
In accordance with Art. 12, Par. 2 of Ordinance 48, the Report consists of:
(a). review of the manner of implementation of the Policy during the Reported Period; and
(b). programme on the implementation of the Policy during the period 1 January 2024 –
31 December 2024.
Furthermore, the Report also contains all of the mandatory requisites pursuant to Art. 13 of
Ordinance No. 48.
Given the repeal of the existing policy by a decision of the General Meeting of Shareholders held on
19 May 2021 and its amendment by a decision of the General Meeting of Shareholders held on
15 September 2021 and both amendments before the reporting period, the Report contains the necessary
information on adopted amendments.
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD
2.1. Information about the process of adopting resolutions upon the determination of the Policy
In accordance with Art. 116e, Par. 1 of the POSA, the Articles of Association of the Company and the Policy, the
determination of the amount of the remuneration of the members of the MB, the members of the Supervisory Board
of the Company (hereinafter referred to as the “SB” ) and of the members of the Audit Committee of the Company
(referred to hereinafter as the “AC” ), their right to receive a portion of the profit, as well as their right to acquire
shares or debt instruments of the Company, are within the competence of the General Meeting.
Pursuant to the Policy, the remuneration of the members of the MB, SB and AC is determined by a resolution of
the General Meeting. The Policy does not envisage the creation of a permanent Remuneration Committee of the
Company as an optional body.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxiv
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.1. Information about the process of adopting resolutions upon the determination of the Policy
(continued)
In fulfilment of this authority, the General Assembly, during the previous period,
• determines the amount of the remuneration of the members of the Management Board, the Supervisory Board
and the А udit Committee with decisions on the agenda of the regular annual General Meetings held on May
19, 2021 and September 15, 2021.
• determines the amount of the remuneration of the members of the Management Board, the Supervisory Board
and the Audit Committee which is based on the adopted decision under item 12 of the agenda of the regular
annual meeting of the General Meeting held on 19 May 2021:
1. remuneration is determined for all members of the Management Board, the Supervisory Board and the
Audit Committee in accordance with the effective rules of the respective body;
2. the respective remuneration of the employees of the holding is also determined;
3. the remuneration determined for employees under an employment contract may be different from that
for those not working in the holding.
• in compliance with the rules contained in the adopted program for the implementation of the Policy for the
current reporting period, no changes were made to the remuneration of the members of the Supervisory Board,
the Management Board and the Audit Committee:
2.2. Information about the relative weight of the variable and the fixed remuneration of the members of
the MB and the SB
Pursuant to item 6.2 of the Policy, the remuneration of the members of the MB, SB and AC consists of a fixed
component only (i.e. no variable component was determined for any of those members).
According to the adopted Policy, remuneration for their activities in this capacity can be received by all members
of the Management Board, the Supervisory Board and the А udit Committee.
During the Reported Period:
• to each of the entitled members of the MB, SB and AC was paid permanent remuneration containing only
a fixed component, which represented 100% (one hundred percent) of the remuneration accordingly
accrued by the Company for their activity as such members during the Reported Period; and
• none of the bodies of the Company resolved on the payment of additional remuneration, tantiemes, tangible
incentives, in-kind remuneration or payments or fringe benefits to the members of MB, SB and AC.
2.3. Information about the assessment criteria, on the basis of which variable remuneration could be
accrued; substantiation of how these criteria benefit to the long-term interests of the Company;
explanation of the methods adopted for the assessment of the achieved results and of the relevance
between the remuneration and the achieved results, as well as regarding the periods of deferral of
the payment of variable remuneration
During the Reported Period, no variable remuneration was accrued or paid to any of the members of the MB, SB
and AC. Respectively, no assessment criteria of the achieved results, on the basis of which such remuneration
could be paid, were elaborated. Neither were applied methods of assessment of meeting such criteria and relevance
between the achieved results and such remuneration.
During the reporting period, none of the payments of remuneration of the members of the MB, SB and AC whether
in whole or in any portion, was deferred. These remunerations were paid, as permanent remunerations per se , in
their full amounts and by the deadline provided for in the individual agreements between the respective member
of the MB, SB or AC and the Company.
REMUNERATION REPORT
31 December 2023
xxxiv
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.1. Information about the process of adopting resolutions upon the determination of the Policy
(continued)
In fulfilment of this authority, the General Assembly, during the previous period,
• determines the amount of the remuneration of the members of the Management Board, the Supervisory Board
and the А udit Committee with decisions on the agenda of the regular annual General Meetings held on May
19, 2021 and September 15, 2021.
• determines the amount of the remuneration of the members of the Management Board, the Supervisory Board
and the Audit Committee which is based on the adopted decision under item 12 of the agenda of the regular
annual meeting of the General Meeting held on 19 May 2021:
1. remuneration is determined for all members of the Management Board, the Supervisory Board and the
Audit Committee in accordance with the effective rules of the respective body;
2. the respective remuneration of the employees of the holding is also determined;
3. the remuneration determined for employees under an employment contract may be different from that
for those not working in the holding.
• in compliance with the rules contained in the adopted program for the implementation of the Policy for the
current reporting period, no changes were made to the remuneration of the members of the Supervisory Board,
the Management Board and the Audit Committee:
2.2. Information about the relative weight of the variable and the fixed remuneration of the members of
the MB and the SB
Pursuant to item 6.2 of the Policy, the remuneration of the members of the MB, SB and AC consists of a fixed
component only (i.e. no variable component was determined for any of those members).
According to the adopted Policy, remuneration for their activities in this capacity can be received by all members
of the Management Board, the Supervisory Board and the А udit Committee.
During the Reported Period:
• to each of the entitled members of the MB, SB and AC was paid permanent remuneration containing only
a fixed component, which represented 100% (one hundred percent) of the remuneration accordingly
accrued by the Company for their activity as such members during the Reported Period; and
• none of the bodies of the Company resolved on the payment of additional remuneration, tantiemes, tangible
incentives, in-kind remuneration or payments or fringe benefits to the members of MB, SB and AC.
2.3. Information about the assessment criteria, on the basis of which variable remuneration could be
accrued; substantiation of how these criteria benefit to the long-term interests of the Company;
explanation of the methods adopted for the assessment of the achieved results and of the relevance
between the remuneration and the achieved results, as well as regarding the periods of deferral of
the payment of variable remuneration
During the Reported Period, no variable remuneration was accrued or paid to any of the members of the MB, SB
and AC. Respectively, no assessment criteria of the achieved results, on the basis of which such remuneration
could be paid, were elaborated. Neither were applied methods of assessment of meeting such criteria and relevance
between the achieved results and such remuneration.
During the reporting period, none of the payments of remuneration of the members of the MB, SB and AC whether
in whole or in any portion, was deferred. These remunerations were paid, as permanent remunerations per se , in
their full amounts and by the deadline provided for in the individual agreements between the respective member
of the MB, SB or AC and the Company.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxv
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.4. Information about the main payments and substantiation of the annual bonus payment schedule
and/or of all additional in-kind remuneration
For the reporting period, the total value of the basic remunerations charged and paid by the Company, as we
indicated above, retains the existing dimensions and grounds and amounts to:
• the members of the Supervisory Board who are remunerated on the basis of the Policy and under the
conditions of Article 5, paragraph 3 of it are paid remuneration in the amount of
EUR 1000 (one thousand euros) and 400 EUR / for employees of the group "KORADO - decision of GMS
from 15. 09. 2021 / per month;
• the members of the Management Board to whom remuneration is due on the basis of the Policy and under
the conditions of Article 5, paragraph 3 of it, are remunerated in the amount of
EUR 400 per month. /for the employees of the KORADO Group - decision of the GMS from 15.09.2021/;
• the members of the AC to whom remuneration is due on the basis of the Policy and under the conditions of
Article 5, paragraph 3 of it are remunerated in the amount of EUR 500 (five hundred euros) and 400 EUR
/for employees of the group "KORADO - decision of GMS from
15.09.2021/ per month;
In each accrual or payment of remuneration to the members of the Supervisory Board, the Management Board and
the Supervisory Board, the Company has withheld and paid into the respective budgets within the statutory period
each and all public obligations (including but not limited to: tax, state social security contributions, additional
mandatory insurance and health insurance) in the manner in which these obligations are established by law.
For the reporting period
• no other tangible incentives were accrued or due by the Company to any of the members of the MB, SB
and AC; and
• the Company did not adopt or implement any annual scheme for the payment of bonuses and/or other in-
kind remuneration to members of the MB, SB and AC.
2.5. Description of the main characteristics of any adopted additional voluntary pension insurance
scheme and information about the paid and/or due by the Company contributions on behalf of the
members of the MB, SB and AC
For the Reported Period, the Company did not adopt or realize any additional voluntary pension insurance scheme
on behalf of the members of the MB, SB and AC and no contributions in relation to such scheme were either paid
or due by the Company.
2.6. Information about the policy on compensations for premature termination of contracts
The rules, which govern the compensations to the members of the MB, SB and AC in the event of premature
termination of their contracts, are set forth in item 10 of the Policy. The Company brings the individual contracts
of each of the members of the MB, SB and the AC into full alignment with these rules.
No management and control contracts were terminated with any of the members of the Company ’s Management
and Supervisory Boards during the reporting period.
A Control Services Contract with a member of the Company’s Audit Committee , Mr. Martin Preisler, was
terminated during the reporting period and a new member, Ms. Marketa Strzhinkova, was elected to replace him
by decision of the Company ’s General Meeting from 14 February 2023.
Benefits for early termination are not accrued and paid.
REMUNERATION REPORT
31 December 2023
xxxv
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.4. Information about the main payments and substantiation of the annual bonus payment schedule
and/or of all additional in-kind remuneration
For the reporting period, the total value of the basic remunerations charged and paid by the Company, as we
indicated above, retains the existing dimensions and grounds and amounts to:
• the members of the Supervisory Board who are remunerated on the basis of the Policy and under the
conditions of Article 5, paragraph 3 of it are paid remuneration in the amount of
EUR 1000 (one thousand euros) and 400 EUR / for employees of the group "KORADO - decision of GMS
from 15. 09. 2021 / per month;
• the members of the Management Board to whom remuneration is due on the basis of the Policy and under
the conditions of Article 5, paragraph 3 of it, are remunerated in the amount of
EUR 400 per month. /for the employees of the KORADO Group - decision of the GMS from 15.09.2021/;
• the members of the AC to whom remuneration is due on the basis of the Policy and under the conditions of
Article 5, paragraph 3 of it are remunerated in the amount of EUR 500 (five hundred euros) and 400 EUR
/for employees of the group "KORADO - decision of GMS from
15.09.2021/ per month;
In each accrual or payment of remuneration to the members of the Supervisory Board, the Management Board and
the Supervisory Board, the Company has withheld and paid into the respective budgets within the statutory period
each and all public obligations (including but not limited to: tax, state social security contributions, additional
mandatory insurance and health insurance) in the manner in which these obligations are established by law.
For the reporting period
• no other tangible incentives were accrued or due by the Company to any of the members of the MB, SB
and AC; and
• the Company did not adopt or implement any annual scheme for the payment of bonuses and/or other in-
kind remuneration to members of the MB, SB and AC.
2.5. Description of the main characteristics of any adopted additional voluntary pension insurance
scheme and information about the paid and/or due by the Company contributions on behalf of the
members of the MB, SB and AC
For the Reported Period, the Company did not adopt or realize any additional voluntary pension insurance scheme
on behalf of the members of the MB, SB and AC and no contributions in relation to such scheme were either paid
or due by the Company.
2.6. Information about the policy on compensations for premature termination of contracts
The rules, which govern the compensations to the members of the MB, SB and AC in the event of premature
termination of their contracts, are set forth in item 10 of the Policy. The Company brings the individual contracts
of each of the members of the MB, SB and the AC into full alignment with these rules.
No management and control contracts were terminated with any of the members of the Company ’s Management
and Supervisory Boards during the reporting period.
A Control Services Contract with a member of the Company’s Audit Committee , Mr. Martin Preisler, was
terminated during the reporting period and a new member, Ms. Marketa Strzhinkova, was elected to replace him
by decision of the Company ’s General Meeting from 14 February 2023.
Benefits for early termination are not accrued and paid.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxvi
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.7. Information about the non-transferability period of shares or of the vesting period of options
whenever shares are provided as variable remuneration and information about the period of
retaining of a definite number of shares up to the end of the mandate of the MB, SB and AC members
No variable remuneration based on shares or share options was due or paid during the reporting period.
Respectively, in the Company were not adopted any terms and conditions for the restriction of the transfer of such
shares or options on shares or for the retention of a specific number of shares up until the expiry of the mandate of
the members of the MB, SB and AC.
2.8. Information about the contracts of the MB, SB and AC members of the Company
During the reporting period, members of the MB were:
• Jiří Řezníček (during the whole reporting period);
• Sylvia Drumeva Stefanova (during the whole reporting period); and
• Jana Havlová (during the whole reporting period).
The mandate of all members of the MB is 5 years. It was determined by a resolution of the SB starting from 15
August 2022 and expiring on 15 August 2027.
The duration of the contracts of the members of the MB in the reporting period and the advance notice period in
the event of premature termination of the contracts by the Company are, as follows:
Member of the MB Duration of the Contract Advance Notice Period in the Event
of Premature Termination by the
Company
Jiří Řezníček until the expiry of the 5-year
mandate
as per the requirements of the law
Sylvia Drumeva Stefanova until the expiry of the 5-year
mandate
as per the requirements of the law
Jana Havlová until the expiry of the 5-year
mandate
as per the requirements of the law
During the reporting period, members of the SB were:
• Tomas Kollert (during the whole reporting period)
• Eva Voborová (during the whole reporting period);
• Ivan Lyaskov (during the whole reporting period); and
• Evelina Miltenova Velikova (during the whole reporting period);
The mandate of all members of the SB is 5 years. It was determined by a resolution of the General Meeting held
on 23 May 2018 and expires on 13 June 2023.
By decision of the General Meeting of the Company / GMC of 21 June 2023 / all members of the Supervisory
Board are elected for a new five-year term, which expires on 21 June 2028 year.
REMUNERATION REPORT
31 December 2023
xxxvi
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.7. Information about the non-transferability period of shares or of the vesting period of options
whenever shares are provided as variable remuneration and information about the period of
retaining of a definite number of shares up to the end of the mandate of the MB, SB and AC members
No variable remuneration based on shares or share options was due or paid during the reporting period.
Respectively, in the Company were not adopted any terms and conditions for the restriction of the transfer of such
shares or options on shares or for the retention of a specific number of shares up until the expiry of the mandate of
the members of the MB, SB and AC.
2.8. Information about the contracts of the MB, SB and AC members of the Company
During the reporting period, members of the MB were:
• Jiří Řezníček (during the whole reporting period);
• Sylvia Drumeva Stefanova (during the whole reporting period); and
• Jana Havlová (during the whole reporting period).
The mandate of all members of the MB is 5 years. It was determined by a resolution of the SB starting from 15
August 2022 and expiring on 15 August 2027.
The duration of the contracts of the members of the MB in the reporting period and the advance notice period in
the event of premature termination of the contracts by the Company are, as follows:
Member of the MB Duration of the Contract Advance Notice Period in the Event
of Premature Termination by the
Company
Jiří Řezníček until the expiry of the 5-year
mandate
as per the requirements of the law
Sylvia Drumeva Stefanova until the expiry of the 5-year
mandate
as per the requirements of the law
Jana Havlová until the expiry of the 5-year
mandate
as per the requirements of the law
During the reporting period, members of the SB were:
• Tomas Kollert (during the whole reporting period)
• Eva Voborová (during the whole reporting period);
• Ivan Lyaskov (during the whole reporting period); and
• Evelina Miltenova Velikova (during the whole reporting period);
The mandate of all members of the SB is 5 years. It was determined by a resolution of the General Meeting held
on 23 May 2018 and expires on 13 June 2023.
By decision of the General Meeting of the Company / GMC of 21 June 2023 / all members of the Supervisory
Board are elected for a new five-year term, which expires on 21 June 2028 year.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxvii
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.8. Information about the contracts of the MB, SB and AC members of the Company (continued)
The duration of the contracts of the members of the SB in the Reported Period and the advance notice period in
the event of premature termination of the contracts by the Company are, as follows:
Members of the SB Duration of the Contract Advance Notice Period in the Event
of Premature Termination by the
Company
Tomas Kollert until the expiry of the 5-year
mandate
as per the requirements of the law
Eva Voborová until the expiry of the 5-year
mandate
as per the requirements of the law
Ivan Lyaskov until the expiry of the 5-year
mandate
as per the requirements of the law
Evelina Miltenova Velikova until the expiry of the 5-year
mandate
as per the requirements of the law
In the reporting period members of the AC were:
• Martin Priceler - until 14 February 2023;
• Marketa Strzhinkova – from 14 February 2023;
• Irena Milcheva Mihaylova; and
• Snezhanka Kaloyanova (the last two throughout the reporting period).
The mandate of all AC members is 3 years, determined by a decision of the General Assembly held on 19 May
2021, 14 September 2022 and 14 February 2023 and expires on 19 May 2024
Pursuant to item 10, Par. 1 of the Policy, compensation for a premature termination of the contracts for
management or supervisory services in the Company shall not be due.
Pursuant to item 10, Par. 2 of the Policy the total of all compensations in the event of premature termination,
including compensation for non-compete following such termination of the respective contract (inasmuch as such
would become due) does not exceed the total of the respective fixed remuneration for the last 2 years ending on
the date of termination.
2.9. Information about the remuneration of each person, who has been a member of the MB, SB and AC
of the Company for a specific period within the respective financial year
2.9.1. Remunerations from the Company
The total amount of the remuneration accrued and/or paid by the Company to the persons, who were members of
the MB, SB and AC in the Reported Period is indicated in item 2.4 of the Report.
2.9.2. Other payments by the Company for services provided by the members of the MB, SB and AC beyond the
scope of their usual functions
In the Reported Period, the Company accrued and made payments for services beyond the scope of the ordinary
functions of those members only to the member of the SB Ivan Lyaskov. That is namely remuneration for services
provided by him as a lawyer under a separate agreement for legal services. The remuneration is determined on
market terms and is at the expense of the Company and not relating to the functions of Mr. Lyaskov as a member
of the SB.
REMUNERATION REPORT
31 December 2023
xxxvii
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.8. Information about the contracts of the MB, SB and AC members of the Company (continued)
The duration of the contracts of the members of the SB in the Reported Period and the advance notice period in
the event of premature termination of the contracts by the Company are, as follows:
Members of the SB Duration of the Contract Advance Notice Period in the Event
of Premature Termination by the
Company
Tomas Kollert until the expiry of the 5-year
mandate
as per the requirements of the law
Eva Voborová until the expiry of the 5-year
mandate
as per the requirements of the law
Ivan Lyaskov until the expiry of the 5-year
mandate
as per the requirements of the law
Evelina Miltenova Velikova until the expiry of the 5-year
mandate
as per the requirements of the law
In the reporting period members of the AC were:
• Martin Priceler - until 14 February 2023;
• Marketa Strzhinkova – from 14 February 2023;
• Irena Milcheva Mihaylova; and
• Snezhanka Kaloyanova (the last two throughout the reporting period).
The mandate of all AC members is 3 years, determined by a decision of the General Assembly held on 19 May
2021, 14 September 2022 and 14 February 2023 and expires on 19 May 2024
Pursuant to item 10, Par. 1 of the Policy, compensation for a premature termination of the contracts for
management or supervisory services in the Company shall not be due.
Pursuant to item 10, Par. 2 of the Policy the total of all compensations in the event of premature termination,
including compensation for non-compete following such termination of the respective contract (inasmuch as such
would become due) does not exceed the total of the respective fixed remuneration for the last 2 years ending on
the date of termination.
2.9. Information about the remuneration of each person, who has been a member of the MB, SB and AC
of the Company for a specific period within the respective financial year
2.9.1. Remunerations from the Company
The total amount of the remuneration accrued and/or paid by the Company to the persons, who were members of
the MB, SB and AC in the Reported Period is indicated in item 2.4 of the Report.
2.9.2. Other payments by the Company for services provided by the members of the MB, SB and AC beyond the
scope of their usual functions
In the Reported Period, the Company accrued and made payments for services beyond the scope of the ordinary
functions of those members only to the member of the SB Ivan Lyaskov. That is namely remuneration for services
provided by him as a lawyer under a separate agreement for legal services. The remuneration is determined on
market terms and is at the expense of the Company and not relating to the functions of Mr. Lyaskov as a member
of the SB.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxviii
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.9. Information about the remuneration of each person, who has been a member of the MB, SB and AC
of the Company for a specific period within the respective financial year (continued)
2.9.3. Remunerations and other payments to the members of the MB, SB and AC by other persons / legal entities
belonging to the same group as the Company
No payments were made to the MB, SB and AC members by other individuals / legal entities belonging to the
same group as the Company.
2.9.4. Paid and/or accrued compensations in the event of termination of the functions of members of the MB, SB
and AC
In the Reported Period, no compensation in the event of termination of functions was either accrued or paid to any
of the members of the MB, SB and AC.
All terminated contracts are voluntary and no compensation is due
2.9.5. Overall estimation of all in-kind benefits, equal to remuneration, granted to the members of the MB, SB
and AC
In the Reported Period, no in-kind benefit, equal to remuneration, was either accrued, paid or granted in any way
whatsoever to any of the members of the MB, SB and AC.
2.9.6. Information about all the loans and the social benefits granted and the warranties made by the Company
or by subsidiary companies which were a subject to consolidation into its annual financial statements,
including data of the yet unpaid instalments and the interests due thereto
For the Reported Period, the members of the MB, SB and AC did not receive any loans, payments as social benefits
or grant of warranty by the Company, a subsidiary of the Company or any other company, which is subject to
consolidation into the Annual Financial Statements of the Company.
2.9.7. Shares and/or options on shares and/or other incentive schemes based on shares to the members of the MB,
SB and AC
In the Reported Period was not accrued, paid or granted any remuneration or payment based on shares or options
on shares to any of the members of the MB, SB and AC. Neither did incentive schemes based on shares, regarding
the members of the MB, SB and AC, function in the Company.
3. ANNUAL CHANGE IN THE REMUNERATION, THE RESULTS OF THE COMPANY AND THE
AVERAGE AMOUNT OF REMUNERATION ON THE BASIS OF FULL-TIME EMPLOYEES OF
THE COMPANY, WHO ARE NOT DIRECTORS, DURING THE PREVIOUS AT LEAST FIVE
FINANCIAL YEARS, PRESENTED TOGETHER IN A WAY THAT ALLOWS COMPARISON;
The results of the company's activity in the previous five financial years are the following:
/ In thousands BGN /
2019 - profit 4,262
2020 - profit 4,591
2021 - profit 4,759
2022 - profit 4,382
2023 - profit 3,569
REMUNERATION REPORT
31 December 2023
xxxviii
2. INFORMATION ABOUT THE IMPLEMENTATION OF THE POLICY DURING THE
REPORTED PERIOD (CONTINUED)
2.9. Information about the remuneration of each person, who has been a member of the MB, SB and AC
of the Company for a specific period within the respective financial year (continued)
2.9.3. Remunerations and other payments to the members of the MB, SB and AC by other persons / legal entities
belonging to the same group as the Company
No payments were made to the MB, SB and AC members by other individuals / legal entities belonging to the
same group as the Company.
2.9.4. Paid and/or accrued compensations in the event of termination of the functions of members of the MB, SB
and AC
In the Reported Period, no compensation in the event of termination of functions was either accrued or paid to any
of the members of the MB, SB and AC.
All terminated contracts are voluntary and no compensation is due
2.9.5. Overall estimation of all in-kind benefits, equal to remuneration, granted to the members of the MB, SB
and AC
In the Reported Period, no in-kind benefit, equal to remuneration, was either accrued, paid or granted in any way
whatsoever to any of the members of the MB, SB and AC.
2.9.6. Information about all the loans and the social benefits granted and the warranties made by the Company
or by subsidiary companies which were a subject to consolidation into its annual financial statements,
including data of the yet unpaid instalments and the interests due thereto
For the Reported Period, the members of the MB, SB and AC did not receive any loans, payments as social benefits
or grant of warranty by the Company, a subsidiary of the Company or any other company, which is subject to
consolidation into the Annual Financial Statements of the Company.
2.9.7. Shares and/or options on shares and/or other incentive schemes based on shares to the members of the MB,
SB and AC
In the Reported Period was not accrued, paid or granted any remuneration or payment based on shares or options
on shares to any of the members of the MB, SB and AC. Neither did incentive schemes based on shares, regarding
the members of the MB, SB and AC, function in the Company.
3. ANNUAL CHANGE IN THE REMUNERATION, THE RESULTS OF THE COMPANY AND THE
AVERAGE AMOUNT OF REMUNERATION ON THE BASIS OF FULL-TIME EMPLOYEES OF
THE COMPANY, WHO ARE NOT DIRECTORS, DURING THE PREVIOUS AT LEAST FIVE
FINANCIAL YEARS, PRESENTED TOGETHER IN A WAY THAT ALLOWS COMPARISON;
The results of the company's activity in the previous five financial years are the following:
/ In thousands BGN /
2019 - profit 4,262
2020 - profit 4,591
2021 - profit 4,759
2022 - profit 4,382
2023 - profit 3,569
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xxxix
3. ANNUAL CHANGE IN THE REMUNERATION, THE RESULTS OF THE COMPANY AND THE
AVERAGE AMOUNT OF REMUNERATION ON THE BASIS OF FULL-TIME EMPLOYEES OF
THE COMPANY, WHO ARE NOT DIRECTORS, DURING THE PREVIOUS AT LEAST FIVE
FINANCIAL YEARS, PRESENTED TOGETHER IN A WAY THAT ALLOWS COMPARISON;
(CONTINUED)
The average remuneration based on full-time employees of the company who are not directors in the previous at
least five financial years are as follows:
2019 - BGN 1 530
2020 - BGN 1 580
2021 - BGN 1 870
2022 – BGN 1 840
2023 - BGN 1 980
4. INFORMATION ON THE EXERCISE OF THE POSSIBILITY TO DEMAND A REFUND OF
THE VARIABLE REMUNERATION;
As stated above, during the reporting period variable remuneration was not paid and there is no objective
possibility for its return.
5. INFORMATION ON ALL DEVIATIONS FROM THE PROCEDURE FOR THE
IMPLEMENTATION OF THE REMUNERATION POLICY IN CONNECTION WITH
EXTRAORDINARY CIRCUMSTANCES UNDER ART. 11, PARA. 13, INCLUDING AN
EXPLANATION OF THE NATURE OF THE EXCEPTIONAL CIRCUMSTANCES AND AN
INDICATION OF THE SPECIFIC COMPONENTS THAT HAVE NOT BEEN APPLIED.
So far, no procedure has been discussed and a procedure for deviation from the application of the adopted
Remuneration Policy has been discussed in connection with and / or on the basis of extraordinary circumstances,
as well as the definition of such circumstances.
6. PROGRAMME ON THE IMPLEMENTATION OF THE POLICY THROUGH THE FINANCIAL
YEAR 1 JANUARY 2024 – 31 DECEMBER 2024
For the period January 1, 2024 - December 31, 2024, the Company intends to adhere to the current Remuneration
Policy of the members of the Management Board, the Supervisory Board and Audit committee. These
remunerations would be determined as fixed, unless the General Meeting adopts a resolution on the introduction
of a variable component of such remuneration, in compliance with the relevant requirements to the introduction of
assessment criteria for the achieved results and the deferral of the payment of a specific portion of such variable
remuneration.
In the event that in the period 1 January 2024 – 31 December 2024 the General Meeting adopts a resolution on
granting to the MB, SB or AC members any remuneration based on shares or on any other way of granting tangible
or in-tangible incentives, the accrual and the payment of such remuneration will be performed only following the
adoption of scheme on granting of remuneration based on shares, as proposed to and approved by the General
Meeting and/or in accordance with adopted rules on determination of a bonus scheme.
In the event that in the period 1 January 2024 – 31 December 2024 any amendments or supplementations to the
legislation occur, which require any respective amendment or supplementation to the contracts on the assignment
of management or supervisory services, as already concluded, such amendments will be accomplished and realised
on the basis of negotiations with the respective members of the MB, SB and AC in accordance with the adopted
Policy, the Articles of Association of the Company and the applicable legislation.
In view of the changes in the legislation during the reporting period, a new Remuneration Policy is to be adopted
and approved by the forthcoming GMS, which will accordingly take into account and include all changes that have
occurred.
REMUNERATION REPORT
31 December 2023
xxxix
3. ANNUAL CHANGE IN THE REMUNERATION, THE RESULTS OF THE COMPANY AND THE
AVERAGE AMOUNT OF REMUNERATION ON THE BASIS OF FULL-TIME EMPLOYEES OF
THE COMPANY, WHO ARE NOT DIRECTORS, DURING THE PREVIOUS AT LEAST FIVE
FINANCIAL YEARS, PRESENTED TOGETHER IN A WAY THAT ALLOWS COMPARISON;
(CONTINUED)
The average remuneration based on full-time employees of the company who are not directors in the previous at
least five financial years are as follows:
2019 - BGN 1 530
2020 - BGN 1 580
2021 - BGN 1 870
2022 – BGN 1 840
2023 - BGN 1 980
4. INFORMATION ON THE EXERCISE OF THE POSSIBILITY TO DEMAND A REFUND OF
THE VARIABLE REMUNERATION;
As stated above, during the reporting period variable remuneration was not paid and there is no objective
possibility for its return.
5. INFORMATION ON ALL DEVIATIONS FROM THE PROCEDURE FOR THE
IMPLEMENTATION OF THE REMUNERATION POLICY IN CONNECTION WITH
EXTRAORDINARY CIRCUMSTANCES UNDER ART. 11, PARA. 13, INCLUDING AN
EXPLANATION OF THE NATURE OF THE EXCEPTIONAL CIRCUMSTANCES AND AN
INDICATION OF THE SPECIFIC COMPONENTS THAT HAVE NOT BEEN APPLIED.
So far, no procedure has been discussed and a procedure for deviation from the application of the adopted
Remuneration Policy has been discussed in connection with and / or on the basis of extraordinary circumstances,
as well as the definition of such circumstances.
6. PROGRAMME ON THE IMPLEMENTATION OF THE POLICY THROUGH THE FINANCIAL
YEAR 1 JANUARY 2024 – 31 DECEMBER 2024
For the period January 1, 2024 - December 31, 2024, the Company intends to adhere to the current Remuneration
Policy of the members of the Management Board, the Supervisory Board and Audit committee. These
remunerations would be determined as fixed, unless the General Meeting adopts a resolution on the introduction
of a variable component of such remuneration, in compliance with the relevant requirements to the introduction of
assessment criteria for the achieved results and the deferral of the payment of a specific portion of such variable
remuneration.
In the event that in the period 1 January 2024 – 31 December 2024 the General Meeting adopts a resolution on
granting to the MB, SB or AC members any remuneration based on shares or on any other way of granting tangible
or in-tangible incentives, the accrual and the payment of such remuneration will be performed only following the
adoption of scheme on granting of remuneration based on shares, as proposed to and approved by the General
Meeting and/or in accordance with adopted rules on determination of a bonus scheme.
In the event that in the period 1 January 2024 – 31 December 2024 any amendments or supplementations to the
legislation occur, which require any respective amendment or supplementation to the contracts on the assignment
of management or supervisory services, as already concluded, such amendments will be accomplished and realised
on the basis of negotiations with the respective members of the MB, SB and AC in accordance with the adopted
Policy, the Articles of Association of the Company and the applicable legislation.
In view of the changes in the legislation during the reporting period, a new Remuneration Policy is to be adopted
and approved by the forthcoming GMS, which will accordingly take into account and include all changes that have
occurred.
KORADO-BULGARIA AD
REMUNERATION REPORT
31 December 2023
xl
6. PROGRAMME ON THE IMPLEMENTATION OF THE POLICY THROUGH THE FINANCIAL
YEAR 1 JANUARY 2024 – 31 DECEMBER 2024 (CONTINUED)
This report on the implementation of the Remuneration Policy of the members of the Supervisory and Management
Boards of KORADO-Bulgaria AD in 2023 was adopted at a meeting of the Management Board of the company,
held in 28 February 2024.
Chairman of the Management Board of KORADO-Bulgaria AD:
________________
Jiří Řezníček
REMUNERATION REPORT
31 December 2023
xl
6. PROGRAMME ON THE IMPLEMENTATION OF THE POLICY THROUGH THE FINANCIAL
YEAR 1 JANUARY 2024 – 31 DECEMBER 2024 (CONTINUED)
This report on the implementation of the Remuneration Policy of the members of the Supervisory and Management
Boards of KORADO-Bulgaria AD in 2023 was adopted at a meeting of the Management Board of the company,
held in 28 February 2024.
Chairman of the Management Board of KORADO-Bulgaria AD:
________________
Jiří Řezníček
KORADO-BULGARIA AD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 1
Financial statements in English are translation from the original in Bulgarian
Note 2023 2022
хил. лв. хил. лв.
Sale of products 38,555 54,247
Sale of goods 679 810
Sales of services 40 76
Revenue from contracts with customers 3.1 39,274 55,133
Other income 3.2 341 383
Government grants 3.2 151 1,921
Expenses for materials 8 (25,693) (42,091)
Employee benefit expense 3.3 (5,885) (6,427)
Expenses for hired services 3.4 (1,443) (1,747)
Depreciation and amortization expenses 6, 7, 12.2 (1,088) (1,065)
Other expenses 3.5 (998) (1,156)
Changes in finished goods and work in progress (484) 39
Operating profit 4,175 4,990
Finance costs 3.6 (203) (118)
Profit before income tax 3,972 4,872
Income tax expense 4 (403) (490)
Profit for the year 3,569 4,382
Other comprehensive income
Other comprehensive income not to be reclassified to
profit or loss in subsequent periods
Actuarial losses on defined benefit plans 13 (87) (40)
Income tax effect 4 8 4
Other comprehensive income, net of taxes (78) (36)
Total comprehensive income 3,491 4,346
Basic and diluted earnings per share 5 0,27 0,33
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 1
Financial statements in English are translation from the original in Bulgarian
Note 2023 2022
хил. лв. хил. лв.
Sale of products 38,555 54,247
Sale of goods 679 810
Sales of services 40 76
Revenue from contracts with customers 3.1 39,274 55,133
Other income 3.2 341 383
Government grants 3.2 151 1,921
Expenses for materials 8 (25,693) (42,091)
Employee benefit expense 3.3 (5,885) (6,427)
Expenses for hired services 3.4 (1,443) (1,747)
Depreciation and amortization expenses 6, 7, 12.2 (1,088) (1,065)
Other expenses 3.5 (998) (1,156)
Changes in finished goods and work in progress (484) 39
Operating profit 4,175 4,990
Finance costs 3.6 (203) (118)
Profit before income tax 3,972 4,872
Income tax expense 4 (403) (490)
Profit for the year 3,569 4,382
Other comprehensive income
Other comprehensive income not to be reclassified to
profit or loss in subsequent periods
Actuarial losses on defined benefit plans 13 (87) (40)
Income tax effect 4 8 4
Other comprehensive income, net of taxes (78) (36)
Total comprehensive income 3,491 4,346
Basic and diluted earnings per share 5 0,27 0,33
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
KORADO-BULGARIA AD
STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 2
Financial statements in English are translation from the original in Bulgarian
Notes 31.12.2023 31.12.2022
BGN’000 BGN’000
ASSETS
Non-current assets
Property, plant and equipment 6 13,751 14,210
Right-of-use assets 12.2 450 557
Intangible assets 7 7 14
14,208 14,781
Current assets
Inventories 8 6,967 12,651
Trade and other receivables 9 702 997
Related party trade receivables 16 8,812 4,023
Cash and cash equivalents 10 1,296 489
17,777 18,160
TOTAL ASSETS 31,985 32,941
EQUITY AND LIABILITIES
Equity
Share capital 11.1 13,169 13,169
Share premium 11.2 119 119
Reserves 11.4 566 644
Retained earnings 11,207 8,954
Total equity 25,061 22,886
Non-current liabilities
Lease liabilities 12.1 141 254
Retirement benefit obligation 13 519 529
Loan payables to related parties 16 2,347 6,063
4 6 7
Current liabilities 3,013 6,853
Trade and other payables 14 3,362 2,001
Related party trade payables 16 69 823
Current tax liabilities 102 148
Provisions 15 264 107
Lease liabilities 12.1 114 123
3,911 3,202
Total liabilities 6,925 10,055
TOTAL EQUITY AND LIABILITIES 31,985 32,941
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 2
Financial statements in English are translation from the original in Bulgarian
Notes 31.12.2023 31.12.2022
BGN’000 BGN’000
ASSETS
Non-current assets
Property, plant and equipment 6 13,751 14,210
Right-of-use assets 12.2 450 557
Intangible assets 7 7 14
14,208 14,781
Current assets
Inventories 8 6,967 12,651
Trade and other receivables 9 702 997
Related party trade receivables 16 8,812 4,023
Cash and cash equivalents 10 1,296 489
17,777 18,160
TOTAL ASSETS 31,985 32,941
EQUITY AND LIABILITIES
Equity
Share capital 11.1 13,169 13,169
Share premium 11.2 119 119
Reserves 11.4 566 644
Retained earnings 11,207 8,954
Total equity 25,061 22,886
Non-current liabilities
Lease liabilities 12.1 141 254
Retirement benefit obligation 13 519 529
Loan payables to related parties 16 2,347 6,063
4 6 7
Current liabilities 3,013 6,853
Trade and other payables 14 3,362 2,001
Related party trade payables 16 69 823
Current tax liabilities 102 148
Provisions 15 264 107
Lease liabilities 12.1 114 123
3,911 3,202
Total liabilities 6,925 10,055
TOTAL EQUITY AND LIABILITIES 31,985 32,941
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
KORADO-BULGARIA AD
STATEMENT OF CHANGES IN EQUITY
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 3
Financial statements in English are translation from the original in Bulgarian
Share
capital
(Note
11.1)
Share
premium
(Note 11.2)
Statutory
and other
reserves
(Note
11.4)
Reserve
from
actuarial
valuations
Retained
earnings Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
At 1 January 2022 13,169 119 1,327 (646) 8,391 22,360
Profit for the year - - - - 4,382 4,382
Other comprehensive income - - - (36) - (36)
Total comprehensive income - - - (36) 4,382 4,346
Transactions with owners
Dividends (Note 11.5) - - - - (3,819) (3,819)
Total transactions with owners - - - - (3,819) (3,819)
At 31 December 2022 13,169 119 1,327 (683) 8,954 22,886
At 1 January 2023 13,169 119 1,327 (683) 8,954 22,886
Current profit - - - - 3,569 3,569
Other comprehensive income - - - (78) - (78)
Total comprehensive income - - - (78) 3,569 3,491
Transactions with owners
Dividends (Note 11.5) - - - - (1,316) (1,316)
Total transactions with owners - - - - (1,316) (1,316)
At 31 December 2023 13,169 119 1,327 (761) 11,207 25,061
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
STATEMENT OF CHANGES IN EQUITY
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 3
Financial statements in English are translation from the original in Bulgarian
Share
capital
(Note
11.1)
Share
premium
(Note 11.2)
Statutory
and other
reserves
(Note
11.4)
Reserve
from
actuarial
valuations
Retained
earnings Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
At 1 January 2022 13,169 119 1,327 (646) 8,391 22,360
Profit for the year - - - - 4,382 4,382
Other comprehensive income - - - (36) - (36)
Total comprehensive income - - - (36) 4,382 4,346
Transactions with owners
Dividends (Note 11.5) - - - - (3,819) (3,819)
Total transactions with owners - - - - (3,819) (3,819)
At 31 December 2022 13,169 119 1,327 (683) 8,954 22,886
At 1 January 2023 13,169 119 1,327 (683) 8,954 22,886
Current profit - - - - 3,569 3,569
Other comprehensive income - - - (78) - (78)
Total comprehensive income - - - (78) 3,569 3,491
Transactions with owners
Dividends (Note 11.5) - - - - (1,316) (1,316)
Total transactions with owners - - - - (1,316) (1,316)
At 31 December 2023 13,169 119 1,327 (761) 11,207 25,061
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
KORADO-BULGARIA AD
STATEMENT OF CASH FLOWS
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 4
Financial statements in English are translation from the original in Bulgarian
Notes 31.12.2023 31.12.2022
BGN’000 BGN’000
CASH FLOWS FROM OPERATING ACTIVITY
Proceeds from customers* 29,692 54,055
Payments to suppliers* (21,278) (46,910)
Payments to personnel and social security (5,893) (6,763)
Taxes and customs duties paid (other than income taxes) (2,229) (4,462)
Taxes refunded (other than income taxes) 3,621 6,359
Income tax paid (437) (562)
Interest paid (3) (4)
Bank charges paid and foreign currency differences (41) (49)
Other payments, net (298) (257)
Net cash flows from operating activity 3,134 1,407
CASH FLOWS FROM INVESTING ACTIVITY
Purchase of property, plant and equipment (887) (420)
Net cash flows used in investing activity (887) (420)
CASH FLOWS FROM FINANCING ACTIVITY
Lease payments 12.1, 20 (122) (196)
Loan received 16, 20 - 2,347
Dividends paid 11.5, 20 (1,318) (3,819)
Net cash flows used in financing activity (1,440) (1,668)
Net increase/(decrease) in cash and cash equivalents 807 (681)
Cash and cash equivalents at 1 January 10 489 1,170
Cash and cash equivalents at 31 December 2023 10 1,296 489
*Proceeds from customers and payments to suppliers are presented gross including Value Added Tax (VAT)
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
STATEMENT OF CASH FLOWS
31 DECEMBER 2023
The notes set out on pages 5-34 are an integral part of these financial statements. 4
Financial statements in English are translation from the original in Bulgarian
Notes 31.12.2023 31.12.2022
BGN’000 BGN’000
CASH FLOWS FROM OPERATING ACTIVITY
Proceeds from customers* 29,692 54,055
Payments to suppliers* (21,278) (46,910)
Payments to personnel and social security (5,893) (6,763)
Taxes and customs duties paid (other than income taxes) (2,229) (4,462)
Taxes refunded (other than income taxes) 3,621 6,359
Income tax paid (437) (562)
Interest paid (3) (4)
Bank charges paid and foreign currency differences (41) (49)
Other payments, net (298) (257)
Net cash flows from operating activity 3,134 1,407
CASH FLOWS FROM INVESTING ACTIVITY
Purchase of property, plant and equipment (887) (420)
Net cash flows used in investing activity (887) (420)
CASH FLOWS FROM FINANCING ACTIVITY
Lease payments 12.1, 20 (122) (196)
Loan received 16, 20 - 2,347
Dividends paid 11.5, 20 (1,318) (3,819)
Net cash flows used in financing activity (1,440) (1,668)
Net increase/(decrease) in cash and cash equivalents 807 (681)
Cash and cash equivalents at 1 January 10 489 1,170
Cash and cash equivalents at 31 December 2023 10 1,296 489
*Proceeds from customers and payments to suppliers are presented gross including Value Added Tax (VAT)
These financial statements have been approved by the Management Board of KORADO – Bulgaria AD on
28 February 2024.
Jiri Reznicek Silviya Stefanova
Executive Director Chief Accountant
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager at Deloitte Audit OOD
Registration number 033 in the Register under Art. 20 of IFAA
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2023
5
Financial statements in English are translation from the original in Bulgarian
1. Corporate information
KORADO-Bulgaria AD (“the Company”) is a joint -stock company, registered with the Veliko Tarnovo District Court
under UIC 814190902, with registered address and address of management in the town of Strazhitsa, Veliko Tarnovo
Region, 28 Gladstone Street. All shares of the Company are registered and traded on Bulgarian Stock Exchange – Sofia
AD, Premium Segment. Number of shares in circulation: 13 168 614. Stock exchange code is KBG (4KX).
The main scope of activity of the Company includes: manufacture and sale of heating equipment.
At 31 December 2023 the Company’s shareholders are:
- KORADO a.s., Czech Republic 82,15 %
- Individuals and legal entities 17,85 %
The ultimate parent company is KORADO a.s., Czech Republic. None of the owners of the ultimate parent company
owns more than 35% of the parent’s shares.
The Company’s management consists of Management Board. Those charged of governance are represented by the
Supervisory Board and the Audit Committee of the Company.
According to the Bulgarian legislation, a decision of the General Meeting for approval of these annual financial
statements can be subsequently revoked (by applying the relevant procedure) and in case it is considered appropriate,
new revised financial statements can be prepared and issued for the same financial year.
1.1. Basis of preparation
Statement of compliance
The financial statements of the Company have been prepared in accordance with International Financial Reporting
Standards (IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) as adopted by the
European Union (EU). IFRS as adopted by the EU is the commonly accepted name of the general purpose framework
– the basis of accounting equivalent to the framework definition introduced by § 1, p. 8 of the Additional Provisions of
the Accountancy Act “International Accounting Standards” (IASs).
Historical cost convention
The financial statements have been prepared on a historical cost basis.
The preparation of financial statements in conformity with IFRS requires the use of certain critical and accounting
estimates. It also requires management of the Company to execute its judgment and assumptions. The areas involving
a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial
statements are disclosed in Note 2.
Going concern
The financial statements have been prepared on a going concern basis. The financial statements have been prepared in
Bulgarian leva and all amounts have been rounded off to the nearest thousand (BGN’000), unless otherwise stated.
The Company's current assets exceed its current liabilities as of 31 December 2023 with the amount of
BGN 13,866 thousand (31 December 2022: BGN 14,958 thousand). For the year ended 31 December 2023 the
Company generates profit before tax in the amount of BGN 3,972 thousand (31 December 2022: BGN 4,872 thousand).
As at 31 December 2023 t he Company has equity in the amount of BGN 25,061 thousand (31 December 2022:
BGN 22,886 thousand) and cash equivalents in the amount of BGN 1,296 thousand (31 December 2022:
BGN 489 thousand). For the year ended 31 December 2023 the Company generates positive net cash flows from
operating activities in the amount of BGN 3,134 thousand. (2022: BGN: 1,407 thousand).
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2023
5
Financial statements in English are translation from the original in Bulgarian
1. Corporate information
KORADO-Bulgaria AD (“the Company”) is a joint -stock company, registered with the Veliko Tarnovo District Court
under UIC 814190902, with registered address and address of management in the town of Strazhitsa, Veliko Tarnovo
Region, 28 Gladstone Street. All shares of the Company are registered and traded on Bulgarian Stock Exchange – Sofia
AD, Premium Segment. Number of shares in circulation: 13 168 614. Stock exchange code is KBG (4KX).
The main scope of activity of the Company includes: manufacture and sale of heating equipment.
At 31 December 2023 the Company’s shareholders are:
- KORADO a.s., Czech Republic 82,15 %
- Individuals and legal entities 17,85 %
The ultimate parent company is KORADO a.s., Czech Republic. None of the owners of the ultimate parent company
owns more than 35% of the parent’s shares.
The Company’s management consists of Management Board. Those charged of governance are represented by the
Supervisory Board and the Audit Committee of the Company.
According to the Bulgarian legislation, a decision of the General Meeting for approval of these annual financial
statements can be subsequently revoked (by applying the relevant procedure) and in case it is considered appropriate,
new revised financial statements can be prepared and issued for the same financial year.
1.1. Basis of preparation
Statement of compliance
The financial statements of the Company have been prepared in accordance with International Financial Reporting
Standards (IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) as adopted by the
European Union (EU). IFRS as adopted by the EU is the commonly accepted name of the general purpose framework
– the basis of accounting equivalent to the framework definition introduced by § 1, p. 8 of the Additional Provisions of
the Accountancy Act “International Accounting Standards” (IASs).
Historical cost convention
The financial statements have been prepared on a historical cost basis.
The preparation of financial statements in conformity with IFRS requires the use of certain critical and accounting
estimates. It also requires management of the Company to execute its judgment and assumptions. The areas involving
a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial
statements are disclosed in Note 2.
Going concern
The financial statements have been prepared on a going concern basis. The financial statements have been prepared in
Bulgarian leva and all amounts have been rounded off to the nearest thousand (BGN’000), unless otherwise stated.
The Company's current assets exceed its current liabilities as of 31 December 2023 with the amount of
BGN 13,866 thousand (31 December 2022: BGN 14,958 thousand). For the year ended 31 December 2023 the
Company generates profit before tax in the amount of BGN 3,972 thousand (31 December 2022: BGN 4,872 thousand).
As at 31 December 2023 t he Company has equity in the amount of BGN 25,061 thousand (31 December 2022:
BGN 22,886 thousand) and cash equivalents in the amount of BGN 1,296 thousand (31 December 2022:
BGN 489 thousand). For the year ended 31 December 2023 the Company generates positive net cash flows from
operating activities in the amount of BGN 3,134 thousand. (2022: BGN: 1,407 thousand).
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
6
Financial statements in English are translation from the original in Bulgarian
1.1. Basis of preparation (continued)
Going concern (continued)
Due to the unfavourable economic conditions, the Company’s revenue sales for 2023 was reduced by 28.8% compared
of the same period previous year.
Based on the current analysis, management has not identified a significant uncertainty as to whether the Company will
be able to continue as a going concern. The Company also has the intention and ability to take the measures necessary
to continue as a going concern. Currently, the Company has no liquidity difficulties and delays in deliveries, it performs
timely payments to its suppliers and takes measures to reduce operating costs.
1.2. Summary of significant accounting policies
a) Foreign currency translation
The financial statements are presented in Bulgarian leva, which is also the functional and presentation currency of the
Company. Transactions in foreign currencies are initially recorded in the functional currency rate ruling at the date of
the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated on a monthly basis
by applying the exchange rate published by the Bulgarian National Bank for the last working day of the respective
month.
All exchange differences are taken to the statement of comprehensive income. Non-monetary items that are measured
in terms of historical cost in a foreign currency are translated using the exchange rate as of the date of initial transaction
(acquisition).
b) Revenue from contracts with customers
The Company produces and sells radiators. Customers of the Company are wholesalers. Respectively, sales are
recognised when control of the products (finished goods and goods for resale) has transferred, being when the products
are delivered to the client, the client has full discretion over the channel and price to sell the products, and there is no
unfulfilled obligation that could affect the client’s acceptance of the products. Delivery occurs when the products have
been shipped to the specific location, the risks of obsolescence and loss have been transferred to the client, and either
the client has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the
Company has objective evidence that all criteria for acceptance have been satisfied.
For the purposes of management, the Company has only one operating segment.
The products are often sold with retrospective volume discounts based on aggregate sales over a 12 months period.
Revenue from these sales is recognised based on the price specified in the contract, net of the estimated volume
discounts. Accumulated experience is used to estimate and provide for the discounts, using the expected value method,
and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur.
A refund liability (included in trade and other payables) is recognised for expected volume discounts payable to
customers in relation to sales made until the end of the reporting period. No element of financing is deemed present as
the sales are made with a credit term of 30- 60 days, which is consistent with market practice. The Company’s obligation
to repair or replace faulty products under the standard warranty terms is recognised as a provision.
A receivable is recognised when the goods are delivered as this is the point in time that the consideration is
unconditional because only the passage of time is required before the payment is due.
The Company analyses its sales arrangements according to specific criteria in order to determine whether it acts as a
principal or agent. It has reached the conclusion that it acts as a principal in relation to all such arrangements, as it
controls the goods before transferring them to the customers.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
6
Financial statements in English are translation from the original in Bulgarian
1.1. Basis of preparation (continued)
Going concern (continued)
Due to the unfavourable economic conditions, the Company’s revenue sales for 2023 was reduced by 28.8% compared
of the same period previous year.
Based on the current analysis, management has not identified a significant uncertainty as to whether the Company will
be able to continue as a going concern. The Company also has the intention and ability to take the measures necessary
to continue as a going concern. Currently, the Company has no liquidity difficulties and delays in deliveries, it performs
timely payments to its suppliers and takes measures to reduce operating costs.
1.2. Summary of significant accounting policies
a) Foreign currency translation
The financial statements are presented in Bulgarian leva, which is also the functional and presentation currency of the
Company. Transactions in foreign currencies are initially recorded in the functional currency rate ruling at the date of
the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated on a monthly basis
by applying the exchange rate published by the Bulgarian National Bank for the last working day of the respective
month.
All exchange differences are taken to the statement of comprehensive income. Non-monetary items that are measured
in terms of historical cost in a foreign currency are translated using the exchange rate as of the date of initial transaction
(acquisition).
b) Revenue from contracts with customers
The Company produces and sells radiators. Customers of the Company are wholesalers. Respectively, sales are
recognised when control of the products (finished goods and goods for resale) has transferred, being when the products
are delivered to the client, the client has full discretion over the channel and price to sell the products, and there is no
unfulfilled obligation that could affect the client’s acceptance of the products. Delivery occurs when the products have
been shipped to the specific location, the risks of obsolescence and loss have been transferred to the client, and either
the client has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the
Company has objective evidence that all criteria for acceptance have been satisfied.
For the purposes of management, the Company has only one operating segment.
The products are often sold with retrospective volume discounts based on aggregate sales over a 12 months period.
Revenue from these sales is recognised based on the price specified in the contract, net of the estimated volume
discounts. Accumulated experience is used to estimate and provide for the discounts, using the expected value method,
and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur.
A refund liability (included in trade and other payables) is recognised for expected volume discounts payable to
customers in relation to sales made until the end of the reporting period. No element of financing is deemed present as
the sales are made with a credit term of 30- 60 days, which is consistent with market practice. The Company’s obligation
to repair or replace faulty products under the standard warranty terms is recognised as a provision.
A receivable is recognised when the goods are delivered as this is the point in time that the consideration is
unconditional because only the passage of time is required before the payment is due.
The Company analyses its sales arrangements according to specific criteria in order to determine whether it acts as a
principal or agent. It has reached the conclusion that it acts as a principal in relation to all such arrangements, as it
controls the goods before transferring them to the customers.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
7
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
c) Taxes
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that
are enacted or substantially enacted by the reporting date. Management analyses the individual items of the tax return
for which the applicable tax provisions are subject to interpretation and recognises provisions where appropriate.
Current income tax is recognised directly in the equity or in other comprehensive income (and not in profit or loss)
where the tax relates to items that have been recognised directly in the equity or in other comprehensive income.
Deferred income tax
Deferred income tax is provided using the liability method on temporary differences at the reporting date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognized for all taxable temporary differences, except where the deferred income
tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination
and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.
Deferred income tax assets are recognized for all deductible temporary differences, carry forward of unused tax credits
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except where
the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset
to be utilised. Unrecognized deferred income tax assets are reassessed at each reporting date and are recognized to the
extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.
Deferred taxes relating to items recognized outside profit and loss are recognized out of profit and loss. Deferred taxes
are recognized depending on the transaction they relate to in other comprehensive income, or directly in equity.
Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off
current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity
and the same taxation authority. As of reporting date – offsetting is applied by Company.
Value added tax (VAT)
Revenue, expenses and assets are recognised net of VAT except:
• when the VAT incurred on a purchase of assets or services is not recoverable from the taxation authority, in which
case the VAT is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
• receivables and payables that are stated with the amount of VAT included.
The net amount of VAT recoverable from, or payable to, the taxation authority is included as part of receivables or
payables in the statement of financial position.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
7
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
c) Taxes
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that
are enacted or substantially enacted by the reporting date. Management analyses the individual items of the tax return
for which the applicable tax provisions are subject to interpretation and recognises provisions where appropriate.
Current income tax is recognised directly in the equity or in other comprehensive income (and not in profit or loss)
where the tax relates to items that have been recognised directly in the equity or in other comprehensive income.
Deferred income tax
Deferred income tax is provided using the liability method on temporary differences at the reporting date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognized for all taxable temporary differences, except where the deferred income
tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination
and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.
Deferred income tax assets are recognized for all deductible temporary differences, carry forward of unused tax credits
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except where
the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset
to be utilised. Unrecognized deferred income tax assets are reassessed at each reporting date and are recognized to the
extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.
Deferred taxes relating to items recognized outside profit and loss are recognized out of profit and loss. Deferred taxes
are recognized depending on the transaction they relate to in other comprehensive income, or directly in equity.
Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off
current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity
and the same taxation authority. As of reporting date – offsetting is applied by Company.
Value added tax (VAT)
Revenue, expenses and assets are recognised net of VAT except:
• when the VAT incurred on a purchase of assets or services is not recoverable from the taxation authority, in which
case the VAT is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
• receivables and payables that are stated with the amount of VAT included.
The net amount of VAT recoverable from, or payable to, the taxation authority is included as part of receivables or
payables in the statement of financial position.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
8
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
d) Financial instruments
(d.1.) Investments and other financial assets
Debt instruments
(i) Classification
The Company classifies its financial assets depending on the business model used to manage these assets and the
specifics of their contractual cash flows as follows:
• those to be measured subsequently at fair value through profit or loss;
• those to be measured subsequently at fair value through OCI, and
• those to be measured at amortised cost.
(ii) Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Company
commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the
financial assets have expired or have been transferred and the Company has transferred substantially all the risks and
rewards of ownership.
(iii) Measurement
At initial recognition, the Company measures a financial asset at its fair value less the costs directly related to the
transaction for the acquisition of the financial asset , except in the case of financial assets that are reported at fair value
in profit or loss Transaction costs of financial assets carried at fair value through profit and loss are expensed in profit
or loss.
At initial recognition, the Company measures trade receivables at their transaction price, as defined in IFRS 15, as
based on standard contract terms applied to them, these do not contain a significant financing component.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows
are solely payment of principal and interest.
Subsequent measurement of debt instruments depends on the Company's business model for managing the asset and
the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies
its debt instruments:
• Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. As the below are immaterial, the following
presentation is applied: Interest income from these financial assets is included in finance income using the effective
interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in
other gains/(Losses) together with foreign exchange gains and losses. Impairment losses are presented in other
expenses.
• Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'
cash flows represent solely payments of principal and interest, are measured at fair value at other comprehensive
income. Movements in the carrying amount are taken through other comprehensive income, except for the recognition
of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit or
loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in other
comprehensive income is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest
income from these financial assets is included in finance income using the effective interest rate method. Foreign
exchange gains and losses are presented in other gains/(losses) and impairment expenses are presented as separate line
item in the statement of comprehensive income.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
8
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
d) Financial instruments
(d.1.) Investments and other financial assets
Debt instruments
(i) Classification
The Company classifies its financial assets depending on the business model used to manage these assets and the
specifics of their contractual cash flows as follows:
• those to be measured subsequently at fair value through profit or loss;
• those to be measured subsequently at fair value through OCI, and
• those to be measured at amortised cost.
(ii) Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Company
commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the
financial assets have expired or have been transferred and the Company has transferred substantially all the risks and
rewards of ownership.
(iii) Measurement
At initial recognition, the Company measures a financial asset at its fair value less the costs directly related to the
transaction for the acquisition of the financial asset , except in the case of financial assets that are reported at fair value
in profit or loss Transaction costs of financial assets carried at fair value through profit and loss are expensed in profit
or loss.
At initial recognition, the Company measures trade receivables at their transaction price, as defined in IFRS 15, as
based on standard contract terms applied to them, these do not contain a significant financing component.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows
are solely payment of principal and interest.
Subsequent measurement of debt instruments depends on the Company's business model for managing the asset and
the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies
its debt instruments:
• Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. As the below are immaterial, the following
presentation is applied: Interest income from these financial assets is included in finance income using the effective
interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in
other gains/(Losses) together with foreign exchange gains and losses. Impairment losses are presented in other
expenses.
• Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets'
cash flows represent solely payments of principal and interest, are measured at fair value at other comprehensive
income. Movements in the carrying amount are taken through other comprehensive income, except for the recognition
of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit or
loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in other
comprehensive income is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest
income from these financial assets is included in finance income using the effective interest rate method. Foreign
exchange gains and losses are presented in other gains/(losses) and impairment expenses are presented as separate line
item in the statement of comprehensive income.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
9
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
d) Financial instruments (continued)
(d.1.) Investments and other financial assets (continued)
Debt instruments (continued)
(iii) Measurement (continued)
• Assets that do not meet the criteria for amortised cost or fair value in other comprehensive income are measured
at fair value in profit and loss. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised
in profit or loss and presented net within other gains/(losses) in the period in which it arises.
The Company owns only financial assets stated at amortised cost.
(iv)Impairment
The Company assesses on a forward looking basis the expected credit losses associated with its debt instruments carried
at amortised cost and fair value in other comprehensive income. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
For trade receivables, the Company applies the simplified approach permitted by IFRS 9, which requires expected
lifetime losses to be recognised from initial recognition of the receivables.
(d.2.) Financial liabilities
Initial recognition and measurement
Financial liabilities are classified as financial liabilities subsequently measured at fair value through profit or loss, or
at amortized cost such as loans and borrowings. The Company determines the classification of its financial liabilities
at initial recognition.
Financial liabilities are recognised initially at fair value and in the case of loans and borrowings, plus the transaction
costs directly related to the acquisition of the financial liability.
The Company’s financial liabilities include trade and other payables, and interest -bearing borrowings and lease
liabilities.
Subsequent measurement
The measurement of financial liabilities depends on their classification as follows:
Loans and borrowings
Subsequent to initial recognition, loans and borrowings are measured at amortised cost using the EIR method. Gains
and losses are recognised in the profit and loss when the liabilities are derecognised as well as through the amortisation
process.
Amortised cost is calculated by taking into account any discounts or premiums on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is included in finance cost in the statement of comprehensive income.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified (NPV changes by more than 10%), such an exchange or
modification is treated as a derecognition of the original liability and the recognition of a new liability, and the
difference in the respective carrying amounts is recognised in the statement of comprehensive income.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
9
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
d) Financial instruments (continued)
(d.1.) Investments and other financial assets (continued)
Debt instruments (continued)
(iii) Measurement (continued)
• Assets that do not meet the criteria for amortised cost or fair value in other comprehensive income are measured
at fair value in profit and loss. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised
in profit or loss and presented net within other gains/(losses) in the period in which it arises.
The Company owns only financial assets stated at amortised cost.
(iv)Impairment
The Company assesses on a forward looking basis the expected credit losses associated with its debt instruments carried
at amortised cost and fair value in other comprehensive income. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
For trade receivables, the Company applies the simplified approach permitted by IFRS 9, which requires expected
lifetime losses to be recognised from initial recognition of the receivables.
(d.2.) Financial liabilities
Initial recognition and measurement
Financial liabilities are classified as financial liabilities subsequently measured at fair value through profit or loss, or
at amortized cost such as loans and borrowings. The Company determines the classification of its financial liabilities
at initial recognition.
Financial liabilities are recognised initially at fair value and in the case of loans and borrowings, plus the transaction
costs directly related to the acquisition of the financial liability.
The Company’s financial liabilities include trade and other payables, and interest -bearing borrowings and lease
liabilities.
Subsequent measurement
The measurement of financial liabilities depends on their classification as follows:
Loans and borrowings
Subsequent to initial recognition, loans and borrowings are measured at amortised cost using the EIR method. Gains
and losses are recognised in the profit and loss when the liabilities are derecognised as well as through the amortisation
process.
Amortised cost is calculated by taking into account any discounts or premiums on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is included in finance cost in the statement of comprehensive income.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified (NPV changes by more than 10%), such an exchange or
modification is treated as a derecognition of the original liability and the recognition of a new liability, and the
difference in the respective carrying amounts is recognised in the statement of comprehensive income.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
10
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
e) Offsetting of financial instruments
Financial assets and liabilities are off set and the net amount reported in the statement of financial position only when
there is a legally enforceable right to offset the recognised amounts, and there is an intention to either settle on a net
basis, or to realise the asset and settle the liability simultaneously. Such a right of set off (a) must not be contingent on
a future event and (b) must be legally enforceable in all of the following circumstances: (i) in the normal course of
business, (ii) in the event of default and (iii) in the event of insolvency or bankruptcy.
(f) Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value measurement is based on the presumption that the
transaction to sell the asset or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible to by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when
pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value
measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by
using the asset in its highest and best use or by selling it to another market participant that would use the asset in its
highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within
the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value
measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
directly or indirectly observable
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable
For assets and liabilities that are measured at fair value in the financial statements on a recurring basis, the Company
determines whether transfer(s) have occurred between Levels in the hierarchy by re-assessing categorisation (based on
the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
As of 31 December 2023, and 31 December 2022 all financial instruments are measured at amortized cost. The carrying
amounts of the short-term trade receivables and trade payables approximate their fair value. The fair value is classified
at level 2 and it is determined based on the discounted cash flows (the discount rate reflects the current market interest
rate for the similar instruments). The fair value of borrowings is estimated via discounting technique based on Bulgarian
National Bank statics for similar types of financing lent by commercial banks to companies – respectively, classified as
level 2. The Company has no financial instruments at fair value.
g) Share capital
The share capital is presented at the par value of shares issued (or subscribed) and paid. Any proceeds from shares
issued over their nominal value are stated as share premiums.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
10
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
e) Offsetting of financial instruments
Financial assets and liabilities are off set and the net amount reported in the statement of financial position only when
there is a legally enforceable right to offset the recognised amounts, and there is an intention to either settle on a net
basis, or to realise the asset and settle the liability simultaneously. Such a right of set off (a) must not be contingent on
a future event and (b) must be legally enforceable in all of the following circumstances: (i) in the normal course of
business, (ii) in the event of default and (iii) in the event of insolvency or bankruptcy.
(f) Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value measurement is based on the presumption that the
transaction to sell the asset or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible to by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when
pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value
measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by
using the asset in its highest and best use or by selling it to another market participant that would use the asset in its
highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within
the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value
measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
directly or indirectly observable
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable
For assets and liabilities that are measured at fair value in the financial statements on a recurring basis, the Company
determines whether transfer(s) have occurred between Levels in the hierarchy by re-assessing categorisation (based on
the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
As of 31 December 2023, and 31 December 2022 all financial instruments are measured at amortized cost. The carrying
amounts of the short-term trade receivables and trade payables approximate their fair value. The fair value is classified
at level 2 and it is determined based on the discounted cash flows (the discount rate reflects the current market interest
rate for the similar instruments). The fair value of borrowings is estimated via discounting technique based on Bulgarian
National Bank statics for similar types of financing lent by commercial banks to companies – respectively, classified as
level 2. The Company has no financial instruments at fair value.
g) Share capital
The share capital is presented at the par value of shares issued (or subscribed) and paid. Any proceeds from shares
issued over their nominal value are stated as share premiums.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
11
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
h) Property, plant and equipment
Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses.
Cost comprises all expenses directly related to the acquisition of the asset. Such cost includes also the cost of replacing
parts of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are
met. When a major inspection of an item of plant and/or equipment is performed, its cost is recognised in the carrying
amount of the respective assets as a replacement if the recognition criteria are satisfied. All other repair and maintenance
costs are recognised in the statement of comprehensive income for the period in which they were incurred.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets, determined for the current
and previous period as follows:
2023 2022
Buildings 10-50 years 10-50 years
Plant and equipment 3-30 years 3-30 years
Hardware 4-7 years 4-7 years
Motor vehicles 7-15 years 7-15 years
Fixtures and fittings 5-10 years 5-10 years
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and the carrying amount of the asset) is included in the statement of comprehensive
income for the period in which the asset is derecognised.
The assets residual values, useful lives and methods of depreciation are reviewed at each financial year end, and if the
expectations differ from the estimates, the latter are adjusted prospectively.
i) Lease - the Company as a lessee
Leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Company. Each lease payment is allocated between the liability and finance cost. The finance
cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining
balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life
and the lease term on a straight-line basis.
The right-of-use asset is presented separately in the statement of financial position.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the
net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payment that are based on an index or a rate
• amounts expected to be payable by the lessee under residual value guarantees
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the
lessee’s incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds
necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions.
Lease liabilities are subsequently measured using the effective interest method. The carrying amount of liability is
remeasured to reflect any reassessment, lease modification or revised in-substance fixed payments.
The lease term is a non-cancellable period of a lease; periods covered by options to extend and terminate the lease are
only included in the lease term if it is reasonably certain that the lease will be extended or not terminated.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
11
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
h) Property, plant and equipment
Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses.
Cost comprises all expenses directly related to the acquisition of the asset. Such cost includes also the cost of replacing
parts of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are
met. When a major inspection of an item of plant and/or equipment is performed, its cost is recognised in the carrying
amount of the respective assets as a replacement if the recognition criteria are satisfied. All other repair and maintenance
costs are recognised in the statement of comprehensive income for the period in which they were incurred.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets, determined for the current
and previous period as follows:
2023 2022
Buildings 10-50 years 10-50 years
Plant and equipment 3-30 years 3-30 years
Hardware 4-7 years 4-7 years
Motor vehicles 7-15 years 7-15 years
Fixtures and fittings 5-10 years 5-10 years
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and the carrying amount of the asset) is included in the statement of comprehensive
income for the period in which the asset is derecognised.
The assets residual values, useful lives and methods of depreciation are reviewed at each financial year end, and if the
expectations differ from the estimates, the latter are adjusted prospectively.
i) Lease - the Company as a lessee
Leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Company. Each lease payment is allocated between the liability and finance cost. The finance
cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining
balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life
and the lease term on a straight-line basis.
The right-of-use asset is presented separately in the statement of financial position.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the
net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payment that are based on an index or a rate
• amounts expected to be payable by the lessee under residual value guarantees
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the
lessee’s incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds
necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions.
Lease liabilities are subsequently measured using the effective interest method. The carrying amount of liability is
remeasured to reflect any reassessment, lease modification or revised in-substance fixed payments.
The lease term is a non-cancellable period of a lease; periods covered by options to extend and terminate the lease are
only included in the lease term if it is reasonably certain that the lease will be extended or not terminated.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
12
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
i) Lease - the Company as a lessee (continued)
Right-of-use assets are measured initially at cost comprising the following:
• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any lease incentives received
• any initial direct costs, and
• restoration costs.
Subsequently, the right-of-use assets, are measured at cost less accumulated depreciation and any accumulated
impairment losses and adjusted for remeasurement of the lease liability due to reassessment or lease modifications.
If the lease transfers ownership of the underlying asset to the lessee by the end of the lease term or if the cost of the
right-of-use asset reflects that the lessee will exercise a purchase option, the lessee shall depreciate the right-of-use
asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the lessee shall
depreciate the right-of-use asset from the commencement date to the earlier of the end of the useful life of the right-of-
use asset or the end of the lease term.
The amortisation periods for the right-of-use assets, depreciated using the straight-line method are as follows:
• right of use for vehicles 7-15 years
Payments associated with short-term leases and leases of low-value assets are recognized on a straight-line basis as an
expense in the statement of comprehensive income. The Company applies the exemption for low-value assets on a
lease-by-lease basis i.e., for the leases where the asset is sub-leased, a right-of-use asset is recognised with
corresponding lease liability; for all other leases of low value asset, the lease payments associated with those leases
will be recognised as an expense on a straight-line basis over the lease term.
Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT-equipment and small
items of office furniture.
The Company’s lease activity
The Company has lease agreements for vehicles. The lease agreements are concluded on an individual basis and contain
a wide range of different conditions. The lease agreements do not contain covenants, but lease assets cannot be used as
collateral for borrowings.
j) Borrowings costs
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective
assets. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest
and other costs that the Company incurs in connection with the borrowing of funds.
k) Earnings per share
Basic earnings per share are calculated by dividing the net profit or loss for the period, subject to distribution among
the shareholders, to the weighted average number of ordinary shares held for the period. The weighted average number
of shares is the number of ordinary shares held in the beginning of the period, adjusted by the number of redeemed
ordinary shares and the shares newly issued over the period, multiplied by the time-weighting factor. This factor is the
number of days that the shares are outstanding as a proportion of the total number of days in the period. In case of
capitalization of reserves, bonus issues, etc., which do not result in change in the Company’s resources, the number of
the ordinary shares before the transaction is adjusted proportionately to their change as if the transaction has been
carried out at the earliest period presented. As a result, the number of ordinary shares is recalculated and respectively,
the earnings per share for the comparative period.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
12
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
i) Lease - the Company as a lessee (continued)
Right-of-use assets are measured initially at cost comprising the following:
• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any lease incentives received
• any initial direct costs, and
• restoration costs.
Subsequently, the right-of-use assets, are measured at cost less accumulated depreciation and any accumulated
impairment losses and adjusted for remeasurement of the lease liability due to reassessment or lease modifications.
If the lease transfers ownership of the underlying asset to the lessee by the end of the lease term or if the cost of the
right-of-use asset reflects that the lessee will exercise a purchase option, the lessee shall depreciate the right-of-use
asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the lessee shall
depreciate the right-of-use asset from the commencement date to the earlier of the end of the useful life of the right-of-
use asset or the end of the lease term.
The amortisation periods for the right-of-use assets, depreciated using the straight-line method are as follows:
• right of use for vehicles 7-15 years
Payments associated with short-term leases and leases of low-value assets are recognized on a straight-line basis as an
expense in the statement of comprehensive income. The Company applies the exemption for low-value assets on a
lease-by-lease basis i.e., for the leases where the asset is sub-leased, a right-of-use asset is recognised with
corresponding lease liability; for all other leases of low value asset, the lease payments associated with those leases
will be recognised as an expense on a straight-line basis over the lease term.
Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT-equipment and small
items of office furniture.
The Company’s lease activity
The Company has lease agreements for vehicles. The lease agreements are concluded on an individual basis and contain
a wide range of different conditions. The lease agreements do not contain covenants, but lease assets cannot be used as
collateral for borrowings.
j) Borrowings costs
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective
assets. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest
and other costs that the Company incurs in connection with the borrowing of funds.
k) Earnings per share
Basic earnings per share are calculated by dividing the net profit or loss for the period, subject to distribution among
the shareholders, to the weighted average number of ordinary shares held for the period. The weighted average number
of shares is the number of ordinary shares held in the beginning of the period, adjusted by the number of redeemed
ordinary shares and the shares newly issued over the period, multiplied by the time-weighting factor. This factor is the
number of days that the shares are outstanding as a proportion of the total number of days in the period. In case of
capitalization of reserves, bonus issues, etc., which do not result in change in the Company’s resources, the number of
the ordinary shares before the transaction is adjusted proportionately to their change as if the transaction has been
carried out at the earliest period presented. As a result, the number of ordinary shares is recalculated and respectively,
the earnings per share for the comparative period.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
13
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
l) Intangible assets
Intangible assets are measured on initial recognition at cost. Following initial recognition, intangible assets are carried
at cost less any accumulated amortisation and/ or any accumulated impairment losses, if any.
The useful lives of intangible assets are assessed to be finite, and are estimated as follows:
2023 2022
Licenses 5-10 years 5-10 years
Software 5-10 years 5-10 years
Intangible assets with finite lives are amortised over the useful economic life applying straight-line amortization method
and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation
period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at each financial
year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits
embodied in the asset is accounted for by changing the amortisation period or method, as appropriate, and treated as
changes in accounting estimates. Gains or losses arising from derecognition of an intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profits and
losses when the asset is derecognised.
m) Inventories
Inventories are measured at the lower of cost and net realisable value.
Costs incurred in bringing each item of inventory to its present location and condition, are accounted for as follows:
Materials and goods – acquisition cost determined under the weighted average value method
Finished products and work in
progress
– cost of direct materials used, labour and overheads allocated based on the
normal production capacity, excluding borrowing costs, determined under the
weighted average value method
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion
and the estimated costs necessary to make the sale.
n) Impairment of non-financial assets
The Company assesses at each reporting date whether there are indications that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the
asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash - generating unit’s (CGU)
fair value less costs to sell and its value in use. It is determined for an individual asset, unless the asset does not generate
cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of
an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable
amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining
fair value less costs of disposal, recent market transactions, if any, are taken into account. If no such transactions can
be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiple and
other available sources of fair values of assets or CGUs.
The Company bases its impairment calculation on detailed budgets and forecast calculations which are prepared
separately for each of the Company’s cash-generating units to which individual assets are allocated. These budgets and
forecast calculations generally cover a period of five years. For longer periods, a long-term growth index is calculating
and applied to future cash flows after the fifth year.
Impairment losses are recognized as other expenses in the statement of comprehensive income.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
13
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
l) Intangible assets
Intangible assets are measured on initial recognition at cost. Following initial recognition, intangible assets are carried
at cost less any accumulated amortisation and/ or any accumulated impairment losses, if any.
The useful lives of intangible assets are assessed to be finite, and are estimated as follows:
2023 2022
Licenses 5-10 years 5-10 years
Software 5-10 years 5-10 years
Intangible assets with finite lives are amortised over the useful economic life applying straight-line amortization method
and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation
period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at each financial
year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits
embodied in the asset is accounted for by changing the amortisation period or method, as appropriate, and treated as
changes in accounting estimates. Gains or losses arising from derecognition of an intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profits and
losses when the asset is derecognised.
m) Inventories
Inventories are measured at the lower of cost and net realisable value.
Costs incurred in bringing each item of inventory to its present location and condition, are accounted for as follows:
Materials and goods – acquisition cost determined under the weighted average value method
Finished products and work in
progress
– cost of direct materials used, labour and overheads allocated based on the
normal production capacity, excluding borrowing costs, determined under the
weighted average value method
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion
and the estimated costs necessary to make the sale.
n) Impairment of non-financial assets
The Company assesses at each reporting date whether there are indications that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the
asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash - generating unit’s (CGU)
fair value less costs to sell and its value in use. It is determined for an individual asset, unless the asset does not generate
cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of
an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable
amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining
fair value less costs of disposal, recent market transactions, if any, are taken into account. If no such transactions can
be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiple and
other available sources of fair values of assets or CGUs.
The Company bases its impairment calculation on detailed budgets and forecast calculations which are prepared
separately for each of the Company’s cash-generating units to which individual assets are allocated. These budgets and
forecast calculations generally cover a period of five years. For longer periods, a long-term growth index is calculating
and applied to future cash flows after the fifth year.
Impairment losses are recognized as other expenses in the statement of comprehensive income.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
14
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
n) Impairment of non-financial assets (continued)
An assessment is made by the Company at each reporting date whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Company
estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there
has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss
was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount,
nor exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been
recognised for the asset in prior years. Such reversal is recognised in profits and losses.
о) Cash and cash equivalents
Cash and short-term deposits in the statement of financial position comprise cash in bank accounts and in hand, and
short-term deposits with an original maturity of three months or less.
For the purpose of the cash flow statement, cash and cash equivalents consist of cash and cash equivalents as defined
above.
p) Employee benefits
Short-term benefits
Short-term employee benefits include salaries, wages, interim and annual bonuses, social security contributions and
paid annual leave of current employees expected to be settled wholly within twelve months after the end of the reporting
period. When the Company receives the service, they are recognised as an employee benefit expense in profit or loss
or are capitalised to the asset’s value. Short -term employee benefits are measured at the undiscounted amount of the
expected cost of benefits. See Note 3.3. for further details.
Retirement benefits
The Company operates a defined benefit plan arising from the requirement of the Bulgarian labour legislation and the
Collective Labour Agreement to pay a certain number of gross monthly salaries to its employees upon retirement,
depending on the length of their service. If an employee has worked for KORADO-Bulgaria AD for 10 years, the
retirement benefit amounts to six gross monthly salaries upon retirement, if he/she has worked for the Company from
5 to 10 years – four gross monthly salaries, and if he/she has worked for less than five years - two gross monthly
salaries. Besides, if an employee has worked for KORADO-Bulgaria AD for more than twenty years, he/she received
eight gross monthly salaries upon retirement. These retirement benefits are unfunded.
The cost of providing benefits under the retirement benefit plan is determined by the Company using the projected unit
credit method. Re-measurements, comprising of actuarial gains and losses, are recognised immediately in the statement
of financial position with a corresponding debit or credit to the reserve from actuarial valuations through other
comprehensive income in the period in which they occur. Re-measurements are not reclassified to profit or loss in
subsequent periods.
Interest expense is calculated by applying the discount rate to the defined benefit liability. The Company recognises
the following changes in the defined benefit obligation in profit or loss for the period:
• interest expense;
• current and past-service costs.
Share based payment plans
Payments for share based plans to employees are valued at the fair of the equity instrument at the date, when the shares
are provided. Remuneration for conditional share based payment plans, which have not vested is measured at the he
fair value at the grant date of the share based payment reflecting these conditions and having no difference between the
expected and actual results.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
14
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
n) Impairment of non-financial assets (continued)
An assessment is made by the Company at each reporting date whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Company
estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there
has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss
was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount,
nor exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been
recognised for the asset in prior years. Such reversal is recognised in profits and losses.
о) Cash and cash equivalents
Cash and short-term deposits in the statement of financial position comprise cash in bank accounts and in hand, and
short-term deposits with an original maturity of three months or less.
For the purpose of the cash flow statement, cash and cash equivalents consist of cash and cash equivalents as defined
above.
p) Employee benefits
Short-term benefits
Short-term employee benefits include salaries, wages, interim and annual bonuses, social security contributions and
paid annual leave of current employees expected to be settled wholly within twelve months after the end of the reporting
period. When the Company receives the service, they are recognised as an employee benefit expense in profit or loss
or are capitalised to the asset’s value. Short -term employee benefits are measured at the undiscounted amount of the
expected cost of benefits. See Note 3.3. for further details.
Retirement benefits
The Company operates a defined benefit plan arising from the requirement of the Bulgarian labour legislation and the
Collective Labour Agreement to pay a certain number of gross monthly salaries to its employees upon retirement,
depending on the length of their service. If an employee has worked for KORADO-Bulgaria AD for 10 years, the
retirement benefit amounts to six gross monthly salaries upon retirement, if he/she has worked for the Company from
5 to 10 years – four gross monthly salaries, and if he/she has worked for less than five years - two gross monthly
salaries. Besides, if an employee has worked for KORADO-Bulgaria AD for more than twenty years, he/she received
eight gross monthly salaries upon retirement. These retirement benefits are unfunded.
The cost of providing benefits under the retirement benefit plan is determined by the Company using the projected unit
credit method. Re-measurements, comprising of actuarial gains and losses, are recognised immediately in the statement
of financial position with a corresponding debit or credit to the reserve from actuarial valuations through other
comprehensive income in the period in which they occur. Re-measurements are not reclassified to profit or loss in
subsequent periods.
Interest expense is calculated by applying the discount rate to the defined benefit liability. The Company recognises
the following changes in the defined benefit obligation in profit or loss for the period:
• interest expense;
• current and past-service costs.
Share based payment plans
Payments for share based plans to employees are valued at the fair of the equity instrument at the date, when the shares
are provided. Remuneration for conditional share based payment plans, which have not vested is measured at the he
fair value at the grant date of the share based payment reflecting these conditions and having no difference between the
expected and actual results.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
15
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
q) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker.
The Board of Directors assesses the financial performance and position of the Company and makes strategic decisions.
The Board of Directors has been identified as being the chief operating decision maker and consists of the chief
executive officer, chief accountant and financial officer of the Company.
1.3. Changes in accounting standards
Initial application of new amendments to the existing standards effective for the current reporting period
The following new standard and amendments to the existing standards issued by the International Accounting Standards
Board (IASB) and adopted by the EU are effective for the current reporting period:
• IFRS 17 Insurance Contracts including amendments to IFRS 17 adopted by the EU in June 2020 and December
2021 (effective for annual periods beginning on or after January 1, 2023);
• Amendments to IAS 1 Presentation of Financial Statements: Disclosure of Accounting policies adopted by the
EU on March 2, 2022 (effective for annual periods beginning on or after January 1, 2023);
• Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors: Definition of
Accounting Estimates adopted by the EU on March 2, 2022 (effective for annual periods beginning on or after
January 1, 2023);
• Amendments to IAS 12 Income Taxes - Deferred Tax related to Assets and Liabilities arising from a Single
Transaction adopted by the EU on 11 August 2022 (effective for annual periods beginning on or after January 1,
2023).
• Amendments to IAS 12 International Tax Reform — Pillar Two Model Rules (IASB effective date: 1 January
2023*);
* exception specified in amendments to IAS 12 (that an entity does not recognise and does not disclose information
about deferred tax assets and liabilities related to the OECD pillar two income taxes) is applicable immediately upon
issuance of the amendments and retrospectively in accordance with IAS 8. The remaining disclosure requirements
are required for annual reporting periods beginning on or after 1 January 2023.
The adoption of amendments to the existing standards has not led to any material changes in the Company’s financial
statements.
Standards and amendments to the existing standards issued by IASB and adopted by the EU but not yet effective
At the date of authorisation of these financial statements, the following revised IFRS Accounting Standard has not been
applied that has been issued by IASB and adopted by EU but are not yet effective:
• Amendments to IFRS 16 Leases - Lease Liability in a Sale and Leaseback issued by IASB on 22 September
2022 (effective for annual periods beginning on or after 1 January 2024);
New standards and amendments to the existing standards issued by IASB but not yet adopted by the EU
At present, IFRS as adopted by the EU do not significantly differ from regulations adopted by IASB except for
the following new standards and amendments to the existing standards, which were not endorsed for use in EU as at
the date of publication of these financial statements (the effective dates stated below is for IFRS as issued by IASB):
• Amendments to IAS 1 Presentation of Financial Statements : Classification of Liabilities as Current or Non-
current and Non-current Liabilities with Covenants (effective for annual periods beginning on or after January 1,
2024);
• Amendments to IAS 7 and IFRS 7: Supplier Finance Arrangements (effective for annual periods beginning
on or after 1 January 2024);
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
15
Financial statements in English are translation from the original in Bulgarian
1.2 Summary of significant accounting policies (continued)
q) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker.
The Board of Directors assesses the financial performance and position of the Company and makes strategic decisions.
The Board of Directors has been identified as being the chief operating decision maker and consists of the chief
executive officer, chief accountant and financial officer of the Company.
1.3. Changes in accounting standards
Initial application of new amendments to the existing standards effective for the current reporting period
The following new standard and amendments to the existing standards issued by the International Accounting Standards
Board (IASB) and adopted by the EU are effective for the current reporting period:
• IFRS 17 Insurance Contracts including amendments to IFRS 17 adopted by the EU in June 2020 and December
2021 (effective for annual periods beginning on or after January 1, 2023);
• Amendments to IAS 1 Presentation of Financial Statements: Disclosure of Accounting policies adopted by the
EU on March 2, 2022 (effective for annual periods beginning on or after January 1, 2023);
• Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors: Definition of
Accounting Estimates adopted by the EU on March 2, 2022 (effective for annual periods beginning on or after
January 1, 2023);
• Amendments to IAS 12 Income Taxes - Deferred Tax related to Assets and Liabilities arising from a Single
Transaction adopted by the EU on 11 August 2022 (effective for annual periods beginning on or after January 1,
2023).
• Amendments to IAS 12 International Tax Reform — Pillar Two Model Rules (IASB effective date: 1 January
2023*);
* exception specified in amendments to IAS 12 (that an entity does not recognise and does not disclose information
about deferred tax assets and liabilities related to the OECD pillar two income taxes) is applicable immediately upon
issuance of the amendments and retrospectively in accordance with IAS 8. The remaining disclosure requirements
are required for annual reporting periods beginning on or after 1 January 2023.
The adoption of amendments to the existing standards has not led to any material changes in the Company’s financial
statements.
Standards and amendments to the existing standards issued by IASB and adopted by the EU but not yet effective
At the date of authorisation of these financial statements, the following revised IFRS Accounting Standard has not been
applied that has been issued by IASB and adopted by EU but are not yet effective:
• Amendments to IFRS 16 Leases - Lease Liability in a Sale and Leaseback issued by IASB on 22 September
2022 (effective for annual periods beginning on or after 1 January 2024);
New standards and amendments to the existing standards issued by IASB but not yet adopted by the EU
At present, IFRS as adopted by the EU do not significantly differ from regulations adopted by IASB except for
the following new standards and amendments to the existing standards, which were not endorsed for use in EU as at
the date of publication of these financial statements (the effective dates stated below is for IFRS as issued by IASB):
• Amendments to IAS 1 Presentation of Financial Statements : Classification of Liabilities as Current or Non-
current and Non-current Liabilities with Covenants (effective for annual periods beginning on or after January 1,
2024);
• Amendments to IAS 7 and IFRS 7: Supplier Finance Arrangements (effective for annual periods beginning
on or after 1 January 2024);
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
16
Financial statements in English are translation from the original in Bulgarian
1.3. Changes in accounting standards(continued)
New standards and amendments to the existing standards issued by IASB but not yet adopted by the EU (continued)
• Amendments to IAS 21: The Effects of Changes in Foreign Exchange Rates - Lack of Exchangeability (IASB
effective date: 1 January 2025);
• IFRS 14 Regulatory Deferral Accounts (effective for annual periods beginning on or after January 1, 2016) -
the European Commission has decided not to launch the endorsement process of this interim standard and to wait
for the final standard;
• Amendments to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and
Joint Ventures - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture and
further amendments (effective date deferred by IASB indefinitely but earlier application permitted). Endorsement
process postponed indefinitely until the research project on the equity method has been concluded.
The Company anticipates that the adoption of these new standards and amendments to the existing standards will have
no material impact on the financial statements of the Company in the period of initial application.
Hedge accounting for a portfolio of financial assets and liabilities whose principals have not been adopted by the EU
remains unregulated.
According to the Company’s estimates, the application of hedge accounting to a portfolio of financial assets or
liabilities pursuant to IAS 39: “Financial Instruments: Recognition and Measurement” would not significantly impact
the financial statements, if applied as at the reporting date.
2. Significant accounting judgments, estimates and assumptions
The preparation of the financial statements requires the management to apply accounting judgements, estimates and
assumptions, which have effect on the amount of reported assets and liabilities, and the disclosure of the contingent
liabilities at the reporting date, as well as on the income and expenses reported for the period. Uncertainties related to
these assumptions and estimates may lead to actual results requiring material adjustments in the carrying amounts of
the respective assets or liabilities in subsequent reporting periods.
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that
have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
reporting period are discussed below.
Net realisable value of inventories
Inventories are written-down in accordance with the accounting policy of KORADO Group based on the estimated sale
/ turnover of goods. The related write-downs are presented as other expenses in the statement of comprehensive income.
The Company’s management believes that the carrying amount of goods as of reporting date is the best estimate of
their net realizable value in compliance with the requirements of IAS 2 Inventories. Respectively, there were no
inventory write offs as at 31 December 2023 and 31 December 2022.
Impairment of receivables
Based on the available information the management has assessed the future cash flows of the receivables from clients
and has not recognised other than immaterial in amount expected credit losses as at 31 December 2023- 0 thousand and
(31 December 2022 – 69 thousand), and respectively are not separately disclosed in the statement of comprehensive
income. Additional information is presented in Note 19.
Applicability of the Organisation for Economic Co-operation and Development ’s ( OECD) Pillar Two Model Rules
At the end of 2023, amendments to the Corporate Income Tax Act (CITA) were adopted, effectively implementing
taxation with a global minimum corporate tax of 15% for multinational and large national groups of entities from
January 1, 2024, in accordance with the conditions specified in the CITA. These amendments are in the context of the
so-called OECD Pillar Two Model Rules in line with the global and European level agreement launched by the OECD's
BEPS (Base Erosion and Profit Shifting) initiative to address tax challenges arising as a result of the digitalisation of
the economy. The Company is not subject to the additional corporate tax.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
16
Financial statements in English are translation from the original in Bulgarian
1.3. Changes in accounting standards(continued)
New standards and amendments to the existing standards issued by IASB but not yet adopted by the EU (continued)
• Amendments to IAS 21: The Effects of Changes in Foreign Exchange Rates - Lack of Exchangeability (IASB
effective date: 1 January 2025);
• IFRS 14 Regulatory Deferral Accounts (effective for annual periods beginning on or after January 1, 2016) -
the European Commission has decided not to launch the endorsement process of this interim standard and to wait
for the final standard;
• Amendments to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and
Joint Ventures - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture and
further amendments (effective date deferred by IASB indefinitely but earlier application permitted). Endorsement
process postponed indefinitely until the research project on the equity method has been concluded.
The Company anticipates that the adoption of these new standards and amendments to the existing standards will have
no material impact on the financial statements of the Company in the period of initial application.
Hedge accounting for a portfolio of financial assets and liabilities whose principals have not been adopted by the EU
remains unregulated.
According to the Company’s estimates, the application of hedge accounting to a portfolio of financial assets or
liabilities pursuant to IAS 39: “Financial Instruments: Recognition and Measurement” would not significantly impact
the financial statements, if applied as at the reporting date.
2. Significant accounting judgments, estimates and assumptions
The preparation of the financial statements requires the management to apply accounting judgements, estimates and
assumptions, which have effect on the amount of reported assets and liabilities, and the disclosure of the contingent
liabilities at the reporting date, as well as on the income and expenses reported for the period. Uncertainties related to
these assumptions and estimates may lead to actual results requiring material adjustments in the carrying amounts of
the respective assets or liabilities in subsequent reporting periods.
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that
have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
reporting period are discussed below.
Net realisable value of inventories
Inventories are written-down in accordance with the accounting policy of KORADO Group based on the estimated sale
/ turnover of goods. The related write-downs are presented as other expenses in the statement of comprehensive income.
The Company’s management believes that the carrying amount of goods as of reporting date is the best estimate of
their net realizable value in compliance with the requirements of IAS 2 Inventories. Respectively, there were no
inventory write offs as at 31 December 2023 and 31 December 2022.
Impairment of receivables
Based on the available information the management has assessed the future cash flows of the receivables from clients
and has not recognised other than immaterial in amount expected credit losses as at 31 December 2023- 0 thousand and
(31 December 2022 – 69 thousand), and respectively are not separately disclosed in the statement of comprehensive
income. Additional information is presented in Note 19.
Applicability of the Organisation for Economic Co-operation and Development ’s ( OECD) Pillar Two Model Rules
At the end of 2023, amendments to the Corporate Income Tax Act (CITA) were adopted, effectively implementing
taxation with a global minimum corporate tax of 15% for multinational and large national groups of entities from
January 1, 2024, in accordance with the conditions specified in the CITA. These amendments are in the context of the
so-called OECD Pillar Two Model Rules in line with the global and European level agreement launched by the OECD's
BEPS (Base Erosion and Profit Shifting) initiative to address tax challenges arising as a result of the digitalisation of
the economy. The Company is not subject to the additional corporate tax.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
17
Financial statements in English are translation from the original in Bulgarian
3. Income and expenses
3.1 Revenue from contracts with customers and segment information
а) Geographic information
2023 2022
BGN’000 BGN’000
Bulgaria 722 916
Other countries:
Czech Republic 33,083 46,924
Romania 1,022 2,041
Ukraine 1,426 1,209
Hungary 1,273 2,182
Greece 1, 256 1,439
France 297 86
Tunisia 74 138
Cyprus 121 198
39,274 55,133
The geographic information on the revenue from sales of products is based on the customers’ location. There are no
differences between the measurements of the reportable segments’ profits or losses - only one segment identified and
the entity’s profit or loss before income tax expense or income from continuing operations
b) Information by key customers in 2023 and 2022
2023 2022
BGN’000 BGN’000
Customer 1 33,083 46,924
Customer 2 1,273 2,182
Customer 3 1,022 2,041
3.2 Other income
2023 2022
BGN’000 BGN’000
Income from sale of materials 197 323
Income from Government 151 1,921
Other 144 60
492 2,304
The sale of materials is incidental to the main activities. The materials were sold to the Bulgaria company. Respectively,
it is accounted as other income. Income from government is a subsidy for electricity prices.
3.3 Employee benefit expense
2023 2022
BGN’000 BGN’000
Salaries (4,622) (5,453)
Social security contributions (850) (974)
Vaucher (413) -
(5,885) (6,427)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
17
Financial statements in English are translation from the original in Bulgarian
3. Income and expenses
3.1 Revenue from contracts with customers and segment information
а) Geographic information
2023 2022
BGN’000 BGN’000
Bulgaria 722 916
Other countries:
Czech Republic 33,083 46,924
Romania 1,022 2,041
Ukraine 1,426 1,209
Hungary 1,273 2,182
Greece 1, 256 1,439
France 297 86
Tunisia 74 138
Cyprus 121 198
39,274 55,133
The geographic information on the revenue from sales of products is based on the customers’ location. There are no
differences between the measurements of the reportable segments’ profits or losses - only one segment identified and
the entity’s profit or loss before income tax expense or income from continuing operations
b) Information by key customers in 2023 and 2022
2023 2022
BGN’000 BGN’000
Customer 1 33,083 46,924
Customer 2 1,273 2,182
Customer 3 1,022 2,041
3.2 Other income
2023 2022
BGN’000 BGN’000
Income from sale of materials 197 323
Income from Government 151 1,921
Other 144 60
492 2,304
The sale of materials is incidental to the main activities. The materials were sold to the Bulgaria company. Respectively,
it is accounted as other income. Income from government is a subsidy for electricity prices.
3.3 Employee benefit expense
2023 2022
BGN’000 BGN’000
Salaries (4,622) (5,453)
Social security contributions (850) (974)
Vaucher (413) -
(5,885) (6,427)
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
18
Financial statements in English are translation from the original in Bulgarian
3. Income and expenses (continued)
3.4 Expenses for hired services
2023 2022
BGN’000 BGN’000
Management services from related parties (294) (279)
Insurances (72) (254)
Consulting services (156) (143)
Security (267) (238)
Transport costs (98) (154)
Repair and maintenance (171) (117)
Commissions (95) (109)
Advertising (36) (48)
Taxes and charges (77) (73)
Legal services (22) (25)
Telephone charges (60) (48)
Training (5) (2)
Other (90) (257)
(1,443) (1,747)
3.5 Other expenses
2023 2022
BGN’000 BGN’000
Carrying amount of goods for resale sold (530) (656)
Carrying amount of materials sold (197) (283)
Business trips (65) (62)
Scrap of assets (23) (21)
Entertainment expenses (11) (9)
Expenses of provision (123) (21)
Impairment of trade receivables (-) (69)
Court fees (4) (19)
Other (45) (16)
(998) (1,156)
3.6 Finance costs
2023 2022
BGN’000 BGN’000
Interest expenses on borrowings and leasing (183) (92)
Expenses on charges and commission fees (16) (23)
FX gains and losses, net (4) (3)
(203) (118)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
18
Financial statements in English are translation from the original in Bulgarian
3. Income and expenses (continued)
3.4 Expenses for hired services
2023 2022
BGN’000 BGN’000
Management services from related parties (294) (279)
Insurances (72) (254)
Consulting services (156) (143)
Security (267) (238)
Transport costs (98) (154)
Repair and maintenance (171) (117)
Commissions (95) (109)
Advertising (36) (48)
Taxes and charges (77) (73)
Legal services (22) (25)
Telephone charges (60) (48)
Training (5) (2)
Other (90) (257)
(1,443) (1,747)
3.5 Other expenses
2023 2022
BGN’000 BGN’000
Carrying amount of goods for resale sold (530) (656)
Carrying amount of materials sold (197) (283)
Business trips (65) (62)
Scrap of assets (23) (21)
Entertainment expenses (11) (9)
Expenses of provision (123) (21)
Impairment of trade receivables (-) (69)
Court fees (4) (19)
Other (45) (16)
(998) (1,156)
3.6 Finance costs
2023 2022
BGN’000 BGN’000
Interest expenses on borrowings and leasing (183) (92)
Expenses on charges and commission fees (16) (23)
FX gains and losses, net (4) (3)
(203) (118)
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
19
Financial statements in English are translation from the original in Bulgarian
4. Income tax
The major components of the income tax expense as at 31 December 2023 and 31 December 2022 are:
2023 2022
BGN’000 BGN’000
Current income tax expense (396) (467)
Deferred tax expense (7) (23)
Income tax expense recognized in profit or loss (403) (490)
Deferred tax on actuarial gains and losses 8 4
Income tax credit recognized in other comprehensive income 8 4
The applicable tax rate in 2023 and 2022 is 10%. A reconciliation between the income tax expense and the accounting
profit at the applicable tax rate as at 31 December 2023 and 31 December 2022 are:
2023 2022
BGN’000 BGN’000
Profit before taxes 3,972 4,872
Income tax expense at the applicable tax rate of 10% for 2023 and 2022 (396) (487)
Permanent differences (7) (3)
Income tax expense at an effective tax rate of 10 % (403) (490)
As at 31 December 2023 and 31 December 2022 deferred taxes are related to the following:
Statement of financial position Comprehensive income
31.12.2023 31.12.2022 2023 2022
BGN’000 BGN’000 BGN’000 BGN’000
Deferred tax assets/(liabilities)
Accelerated depreciation (84) (78) (6) (7)
Unused paid leave 24 11 16 (16)
Remuneration of personnel - 1 (1)
Impairment - 6 (7) 6
Retirement benefits liability 52 53 (9) (2)
Deferred tax assets/(liabilities), net (6) (7) (7) (19)
Reconciliation of deferred taxes, net
2023 31.12.2022
BGN’000 BGN’000
At 1 January (7) 11
Deferred taxes recognized in profit or loss for the period (7) (23)
Deferred taxes recognized in other comprehensive income 8 4
At 31 December (6) (7)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
31 DECEMBER 2023
19
Financial statements in English are translation from the original in Bulgarian
4. Income tax
The major components of the income tax expense as at 31 December 2023 and 31 December 2022 are:
2023 2022
BGN’000 BGN’000
Current income tax expense (396) (467)
Deferred tax expense (7) (23)
Income tax expense recognized in profit or loss (403) (490)
Deferred tax on actuarial gains and losses 8 4
Income tax credit recognized in other comprehensive income 8 4
The applicable tax rate in 2023 and 2022 is 10%. A reconciliation between the income tax expense and the accounting
profit at the applicable tax rate as at 31 December 2023 and 31 December 2022 are:
2023 2022
BGN’000 BGN’000
Profit before taxes 3,972 4,872
Income tax expense at the applicable tax rate of 10% for 2023 and 2022 (396) (487)
Permanent differences (7) (3)
Income tax expense at an effective tax rate of 10 % (403) (490)
As at 31 December 2023 and 31 December 2022 deferred taxes are related to the following:
Statement of financial position Comprehensive income
31.12.2023 31.12.2022 2023 2022
BGN’000 BGN’000 BGN’000 BGN’000
Deferred tax assets/(liabilities)
Accelerated depreciation (84) (78) (6) (7)
Unused paid leave 24 11 16 (16)
Remuneration of personnel - 1 (1)
Impairment - 6 (7) 6
Retirement benefits liability 52 53 (9) (2)
Deferred tax assets/(liabilities), net (6) (7) (7) (19)
Reconciliation of deferred taxes, net
2023 31.12.2022
BGN’000 BGN’000
At 1 January (7) 11
Deferred taxes recognized in profit or loss for the period (7) (23)
Deferred taxes recognized in other comprehensive income 8 4
At 31 December (6) (7)
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
20
Financial statements in English are translation from the original in Bulgarian
5. Earnings per share
Basic earnings per share are calculated by dividing the profit for the period to the weighted average number of
ordinary shares held for the period.
The Company’s basic earnings per share are calculated by using the following data:
2023 2022
Net profit for the year (in BGN’000) 3,569 4,382
Weighted average number of ordinary shares held for the period (in thousand) 13,169 13,169
Basic earnings per share (in BGN) 0,27 0,33
6. Property, plant and equipment
Land
(terrains)
Buildings,
installations
and
outdoor
equipment
Plant,
equipment,
fixtures
and fittings
Motor
vehicles
Assets
under
construction Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Cost
At 1 January 2022 407 5,018 19,795 975 2,092 28,287
Additions - - 101 - 860 961
Disposals - - (42) (5) - (47)
Transferred from right of use assets - - - 17 - 17
Transfers - 53 266 - (319) -
At 31 December 2022 407 5,071 20,120 987 2,633 29,218
At 1 January 2023 407 5,071 20,120 987 2,633 29,218
Additions - - 154 9 354 517
Disposals - - (55) (96) (151)
Transferred from right of use assets - - - 31 - 31
Transfers - - 724 - (724) -
At 31 December 2023 407 5,071 20,943 931 2,263 29,615
Accumulated depreciation:
At 1 January 2022 - 3,288 10,152 601 - 14,041
Depreciation charge for the period - 83 853 70 - 1,006
Transferred from right of use assets - - - 8 - 8
Written off - - (42) (5) - (47)
At 31 December 2022 - 3,371 10,963 674 - 15,008
At 1 January 2023 - 3,371 10,963 674 - 15,008
Depreciation charge for the period - 87 852 65 - 1,004
Transferred from right of use assets - - - - -
Written off - - (55) (93) - (148)
At 31 December 2023 - 3,458 11,760 646 - 15,864
Carrying amount
At 1 January 2022 407 1,730 9,643 374 2,092 14,246
At 31 December 2022 407 1,700 9,157 313 2,633 14,210
At 31 December 2023 407 1,613 9,183 285 2,263 13,751
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
20
Financial statements in English are translation from the original in Bulgarian
5. Earnings per share
Basic earnings per share are calculated by dividing the profit for the period to the weighted average number of
ordinary shares held for the period.
The Company’s basic earnings per share are calculated by using the following data:
2023 2022
Net profit for the year (in BGN’000) 3,569 4,382
Weighted average number of ordinary shares held for the period (in thousand) 13,169 13,169
Basic earnings per share (in BGN) 0,27 0,33
6. Property, plant and equipment
Land
(terrains)
Buildings,
installations
and
outdoor
equipment
Plant,
equipment,
fixtures
and fittings
Motor
vehicles
Assets
under
construction Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Cost
At 1 January 2022 407 5,018 19,795 975 2,092 28,287
Additions - - 101 - 860 961
Disposals - - (42) (5) - (47)
Transferred from right of use assets - - - 17 - 17
Transfers - 53 266 - (319) -
At 31 December 2022 407 5,071 20,120 987 2,633 29,218
At 1 January 2023 407 5,071 20,120 987 2,633 29,218
Additions - - 154 9 354 517
Disposals - - (55) (96) (151)
Transferred from right of use assets - - - 31 - 31
Transfers - - 724 - (724) -
At 31 December 2023 407 5,071 20,943 931 2,263 29,615
Accumulated depreciation:
At 1 January 2022 - 3,288 10,152 601 - 14,041
Depreciation charge for the period - 83 853 70 - 1,006
Transferred from right of use assets - - - 8 - 8
Written off - - (42) (5) - (47)
At 31 December 2022 - 3,371 10,963 674 - 15,008
At 1 January 2023 - 3,371 10,963 674 - 15,008
Depreciation charge for the period - 87 852 65 - 1,004
Transferred from right of use assets - - - - -
Written off - - (55) (93) - (148)
At 31 December 2023 - 3,458 11,760 646 - 15,864
Carrying amount
At 1 January 2022 407 1,730 9,643 374 2,092 14,246
At 31 December 2022 407 1,700 9,157 313 2,633 14,210
At 31 December 2023 407 1,613 9,183 285 2,263 13,751
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
21
Financial statements in English are translation from the original in Bulgarian
6. Property, plant and equipment(continued)
Assets under construction
At 31 December 2023 and 31 December 2022 assets under construction progress are related to the completion of
the production facilities’ renovation.
Impairment of property, plant and equipment
Based on the impairment testing of fixed tangible assets conducted at 31 December 2023 and 31 December 2022,
the Company’s management did not find any indications that the assets’ carrying amounts might exceed their
recoverable amounts. Therefore, no impairment of property, plant and equipment has been recognized at
31 December 2023 and 31 December 2022.
Fully depreciated assets
At 31 December 2023 the Company held assets with a cost of BGN 5,830 thousand (31 December 2022:
BGN 5,447 thousand), which were fully depreciated but still in use. These included: buildings of
BGN 1,648 thousand (31 December 2022: BGN 1,648 thousand), production equipment of BGN 3,745 thousand
(31 December 2022: BGN 3,383 thousand), motor vehicles of BGN 209 thousand (31 December 2022:
BGN 237 thousand), fixture and fittings of BGN 123 thousand (31 December 2022: BGN 74 thousand), hardware
of BGN 95 thousand (31 December 2022: BGN 93 thousand), and other equipment of BGN 10 thousand
(31 December 2022: BGN 12 thousand).
Items of property, plant and equipment has not been mortgaged by the Company.
Geographic information
All items of property, plant and equipment are located in the territory of Bulgaria.
7. Intangible assets
Software
BGN’000
Cost:
At 1 January 2022 97
Additions 8
Disposals -
At 31 December 2022 105
At 1 January 2023 105
Additions -
Disposals -
At 31 December 2023 105
Accumulated amortisation
At 1 January 2022 84
Amortisation charge for the period 7
Amortisation of disposals -
At 31 December 2022 91
At 1 January 2023 91
Amortisation charge for the period 7
Amortisation of disposals -
At 31 December 2023 98
Carrying amount
At 1 January 2022 13
At 31 December 2022 14
At 31 December 2023 7
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
21
Financial statements in English are translation from the original in Bulgarian
6. Property, plant and equipment(continued)
Assets under construction
At 31 December 2023 and 31 December 2022 assets under construction progress are related to the completion of
the production facilities’ renovation.
Impairment of property, plant and equipment
Based on the impairment testing of fixed tangible assets conducted at 31 December 2023 and 31 December 2022,
the Company’s management did not find any indications that the assets’ carrying amounts might exceed their
recoverable amounts. Therefore, no impairment of property, plant and equipment has been recognized at
31 December 2023 and 31 December 2022.
Fully depreciated assets
At 31 December 2023 the Company held assets with a cost of BGN 5,830 thousand (31 December 2022:
BGN 5,447 thousand), which were fully depreciated but still in use. These included: buildings of
BGN 1,648 thousand (31 December 2022: BGN 1,648 thousand), production equipment of BGN 3,745 thousand
(31 December 2022: BGN 3,383 thousand), motor vehicles of BGN 209 thousand (31 December 2022:
BGN 237 thousand), fixture and fittings of BGN 123 thousand (31 December 2022: BGN 74 thousand), hardware
of BGN 95 thousand (31 December 2022: BGN 93 thousand), and other equipment of BGN 10 thousand
(31 December 2022: BGN 12 thousand).
Items of property, plant and equipment has not been mortgaged by the Company.
Geographic information
All items of property, plant and equipment are located in the territory of Bulgaria.
7. Intangible assets
Software
BGN’000
Cost:
At 1 January 2022 97
Additions 8
Disposals -
At 31 December 2022 105
At 1 January 2023 105
Additions -
Disposals -
At 31 December 2023 105
Accumulated amortisation
At 1 January 2022 84
Amortisation charge for the period 7
Amortisation of disposals -
At 31 December 2022 91
At 1 January 2023 91
Amortisation charge for the period 7
Amortisation of disposals -
At 31 December 2023 98
Carrying amount
At 1 January 2022 13
At 31 December 2022 14
At 31 December 2023 7
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
22
Financial statements in English are translation from the original in Bulgarian
7. Intangible assets (continued)
Impairment of intangible assets
The Company performed an impairment testing of intangible assets at 31 December 2023 and 31 December 2022.
No indications were found out that the assets’ carrying amounts might exceed their recoverable amounts and
therefore, no impairment loss was recognized in the financial statements.
Fully amortised intangible assets
At 31 December 2023 the Company held software with a cost of BGN 46 thousand (31 December 2022: BGN 48
thousand), which were fully amortised but still in use.
8. Inventories
31.12.2023 31.12.2022
BGN’000 BGN’000
Raw materials 5,794 10,961
Finished goods 796 1,169
Goods 198 213
Work in progress 179 308
6,967 12,651
No write downs to NRV were made in the period. No inventories were pledged as a security. The inventories
forming the cost of sales during the period and respectively recognized as an expense are at the amount of BGN
25,693 thousand (2022: BGN 42,091 thousand).
9. Trade and other receivables
31.12.2023 31.12.2022
BGN’000 BGN’000
Trade receivables, gross 9 197
VAT refundable 649 801
Other receivables 44 68
Impairment on trade receivables - (69)
702 997
Trade receivables are not interest-bearing and are normally settled within 0 - 60 days.
As at 31 December 2023 and 31 December 2022 the ageing analysis of trade receivables is presented in the table
below:
Overdue
Total Regular
< 30
days
30-60
days
60-90
days
90-120
days
>120
days
31.12.2023 9 9 - - - - -
31.12.2022 197 25 - - - - 172
As at 31 December 2023 trade and other receivables of BGN 0 thousand (31 December 2022: BGN 95 thousand)
are denominated in Euro and BGN 9 thousand (31 December 2022: 102 thousand) are denominated in Bulgarian
leva.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
22
Financial statements in English are translation from the original in Bulgarian
7. Intangible assets (continued)
Impairment of intangible assets
The Company performed an impairment testing of intangible assets at 31 December 2023 and 31 December 2022.
No indications were found out that the assets’ carrying amounts might exceed their recoverable amounts and
therefore, no impairment loss was recognized in the financial statements.
Fully amortised intangible assets
At 31 December 2023 the Company held software with a cost of BGN 46 thousand (31 December 2022: BGN 48
thousand), which were fully amortised but still in use.
8. Inventories
31.12.2023 31.12.2022
BGN’000 BGN’000
Raw materials 5,794 10,961
Finished goods 796 1,169
Goods 198 213
Work in progress 179 308
6,967 12,651
No write downs to NRV were made in the period. No inventories were pledged as a security. The inventories
forming the cost of sales during the period and respectively recognized as an expense are at the amount of BGN
25,693 thousand (2022: BGN 42,091 thousand).
9. Trade and other receivables
31.12.2023 31.12.2022
BGN’000 BGN’000
Trade receivables, gross 9 197
VAT refundable 649 801
Other receivables 44 68
Impairment on trade receivables - (69)
702 997
Trade receivables are not interest-bearing and are normally settled within 0 - 60 days.
As at 31 December 2023 and 31 December 2022 the ageing analysis of trade receivables is presented in the table
below:
Overdue
Total Regular
< 30
days
30-60
days
60-90
days
90-120
days
>120
days
31.12.2023 9 9 - - - - -
31.12.2022 197 25 - - - - 172
As at 31 December 2023 trade and other receivables of BGN 0 thousand (31 December 2022: BGN 95 thousand)
are denominated in Euro and BGN 9 thousand (31 December 2022: 102 thousand) are denominated in Bulgarian
leva.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
23
Financial statements in English are translation from the original in Bulgarian
10. Cash and cash equivalents
31.12.2023 31.12.2022
BGN’000 BGN’000
Cash in bank accounts 1,286 483
Cash on hand 10 6
1,296 489
Cash at banks accrue interest at floating interest rates based on the intraday interest rates on bank deposits.
As at 31 December 2023 cash and cash equivalents of BGN 894 thousand (31 December 2022: BGN 285 thousand)
are denominated in Euro and BGN 402 thousand (31 December 2022: 204 thousand) are denominated in Bulgarian
leva.
11. Share capital and reserves
11.1 Share capital
number BGN’000
1 January 2022 13,168,614 13,169
At 31 December 2022 13,168,614 13,169
At 31 December 2023 13,168,614 13,169
All subscribed shares were paid at 31 December 2023 and 31 December 2022.
11.2 Share premium
As at 31 December 2023 and 31 December 2022 the share premium is amounting to BGN 119 thousand.
11.3 Redeemed own shares
In 2019 the Company redeemed 12,000 shares at the total amount of BGN 66 thousand. During the year 945
treasury shares were sold at the amount of BGN 5 thousand.
On 18 September 2019 the shareholders approved a decision for purchase of 12,000 redeemed shares to be
provided to employees in the form of an additional one off compensation to all individuals employed by the
Company for more than 1 year under a labour or management contract. The shares are allocated to 213 qualifying
employees based on a step rate depending on the number of years of employment.
As at 31 December 2023 and 31 December 2022 there are no redeemed shares owned by the Company.
11.4 Statutory reserves and other reserves
Statutory reserves are formed by joint-stock companies, such as KORADO-Bulgaria AD, through distribution of
profits on the grounds of article 246 of the Commercial Act. They are set aside until they reach one-tenth or more
of the capital. Sources of statutory reserves are at least one-tenth of the net profit, share premiums and funds,
stipulated in the Articles of Association or approved by decision of the General Meeting of Shareholders. The
statutory reserves may only be used to cover losses of the Company from the current and previous reporting
periods.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
23
Financial statements in English are translation from the original in Bulgarian
10. Cash and cash equivalents
31.12.2023 31.12.2022
BGN’000 BGN’000
Cash in bank accounts 1,286 483
Cash on hand 10 6
1,296 489
Cash at banks accrue interest at floating interest rates based on the intraday interest rates on bank deposits.
As at 31 December 2023 cash and cash equivalents of BGN 894 thousand (31 December 2022: BGN 285 thousand)
are denominated in Euro and BGN 402 thousand (31 December 2022: 204 thousand) are denominated in Bulgarian
leva.
11. Share capital and reserves
11.1 Share capital
number BGN’000
1 January 2022 13,168,614 13,169
At 31 December 2022 13,168,614 13,169
At 31 December 2023 13,168,614 13,169
All subscribed shares were paid at 31 December 2023 and 31 December 2022.
11.2 Share premium
As at 31 December 2023 and 31 December 2022 the share premium is amounting to BGN 119 thousand.
11.3 Redeemed own shares
In 2019 the Company redeemed 12,000 shares at the total amount of BGN 66 thousand. During the year 945
treasury shares were sold at the amount of BGN 5 thousand.
On 18 September 2019 the shareholders approved a decision for purchase of 12,000 redeemed shares to be
provided to employees in the form of an additional one off compensation to all individuals employed by the
Company for more than 1 year under a labour or management contract. The shares are allocated to 213 qualifying
employees based on a step rate depending on the number of years of employment.
As at 31 December 2023 and 31 December 2022 there are no redeemed shares owned by the Company.
11.4 Statutory reserves and other reserves
Statutory reserves are formed by joint-stock companies, such as KORADO-Bulgaria AD, through distribution of
profits on the grounds of article 246 of the Commercial Act. They are set aside until they reach one-tenth or more
of the capital. Sources of statutory reserves are at least one-tenth of the net profit, share premiums and funds,
stipulated in the Articles of Association or approved by decision of the General Meeting of Shareholders. The
statutory reserves may only be used to cover losses of the Company from the current and previous reporting
periods.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
24
Financial statements in English are translation from the original in Bulgarian
11. Share capital and reserves (continued)
11.5. Dividends
Dividends distributed in 2023
On 21 June 2023 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 1,316 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2022
On 18 May 2022 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 14 September 2022 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2021
On 19 May 2021 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 15 September 2021 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2020
On 20 May 2020 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 16 September 2020 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
12.1. Lease liabilities
The Company concluded lease contracts for vehicles. For leases previously classified as finance lease, the
Company recognised the carrying value of the leased asset and lease liability before the adoption of IFRS 16 and
as carrying value the right of use asset and lease liability as at the date of initial adoption. The Company has only
finance leases with a clause for transferring of ownership of vehicles, these are not modified in the period, no
extension or termination options have been assessed as relevant in determining the lease terms of the respective
vehicles leases. In the period there were no contracts for short term or low value leases, for which the associated
lease payments have been directly expensed.
Interest expense on lease liabilities for the period is BGN 15 thousand (2022: BGN 7 thousand).
As at 31 December 2023 the lease liability amounts to BGN 255 thousand and as at 31 December 2022 amounts
to BGN 377 thousand.
31.12.2023 31.12.2022
Lease
payments
Present
value of
payments
Lease
payments
Present
value of
payments
BGN’000 BGN’000 BGN’000 BGN’000
Within one year 120 114 131 123
From one to five years 151 141 268 254
Total minimum lease payments 271 255 399 377
Less finance charges (16) - (22) -
Present value of lease payments 255 255 377 377
The lease payments presented above do not include a variable component. The vehicles leased are not subleased.
No sale and lease back transactions have been concluded. The total cash outflow on leases is BGN 107 for principal
lease payments and BGN 15 thousand for interest.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
24
Financial statements in English are translation from the original in Bulgarian
11. Share capital and reserves (continued)
11.5. Dividends
Dividends distributed in 2023
On 21 June 2023 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 1,316 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2022
On 18 May 2022 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 14 September 2022 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2021
On 19 May 2021 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 15 September 2021 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
Dividends distributed in 2020
On 20 May 2020 the General Meeting of Shareholders approved distribution of dividends amounting to
BGN 2,502 thousand or a dividend of BGN 0.19 per share.
On 16 September 2020 the General Meeting of Shareholders approved distribution of interim dividends amounting
to BGN 1,317 thousand or a dividend of BGN 0.10 per share.
12.1. Lease liabilities
The Company concluded lease contracts for vehicles. For leases previously classified as finance lease, the
Company recognised the carrying value of the leased asset and lease liability before the adoption of IFRS 16 and
as carrying value the right of use asset and lease liability as at the date of initial adoption. The Company has only
finance leases with a clause for transferring of ownership of vehicles, these are not modified in the period, no
extension or termination options have been assessed as relevant in determining the lease terms of the respective
vehicles leases. In the period there were no contracts for short term or low value leases, for which the associated
lease payments have been directly expensed.
Interest expense on lease liabilities for the period is BGN 15 thousand (2022: BGN 7 thousand).
As at 31 December 2023 the lease liability amounts to BGN 255 thousand and as at 31 December 2022 amounts
to BGN 377 thousand.
31.12.2023 31.12.2022
Lease
payments
Present
value of
payments
Lease
payments
Present
value of
payments
BGN’000 BGN’000 BGN’000 BGN’000
Within one year 120 114 131 123
From one to five years 151 141 268 254
Total minimum lease payments 271 255 399 377
Less finance charges (16) - (22) -
Present value of lease payments 255 255 377 377
The lease payments presented above do not include a variable component. The vehicles leased are not subleased.
No sale and lease back transactions have been concluded. The total cash outflow on leases is BGN 107 for principal
lease payments and BGN 15 thousand for interest.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
25
Financial statements in English are translation from the original in Bulgarian
12.2.Right of Use Assets
As at 31 December 2023 the carrying amount of the right of use assets (vehicles previously presented as finance
lease liabilities) is BGN 450 thousand (31 December 2022: BGN 557 thousand).
The carrying amount of the right of use asset could be analysed as follows:
Vehicles 31.12.2023 31.12.2022
BGN’000 BGN’000
Carrying amount
At 1 January 557 219
Additions – new lease contracts - 400
Termination of lease contracts (31) (17)
Depreciation for the year (76) (45)
At 31 December 450 557
In further detail, the movement of right of use asset and transfers to property, plant and equipment is shown below:
Right-of-use
assets
Cost BGN’000
At 1 January 2022 282
Additions 400
Disposals
Transferred to motor vehicles (PP&E) (17)
At 31 December 2022 665
At 1 January 2023 665
Additions -
Disposals
Transferred to motor vehicles (PP&E) (31)
At 31 December 2023 634
Accumulated depreciation:
At 1 January 2022 63
Depreciation charge for the period 53
Transferred to motor vehicles (PP&E) (8)
At 31 December 2022 108
At 1 January 2023 108
Depreciation charge for the period 76
Transferred to motor vehicles (PP&E) -
At 31 December 2023 184
Carrying value
At 1 January 2022 219
At 31 December 2022 557
At 31 December 2023 450
13. Retirement benefits
Pursuant to the requirement of the Bulgarian labour legislation and the Collective Labour Agreement, the Company
is obliged to pay two to six gross monthly salaries to its employees upon retirement, depending on the length of
their service in the Company. If an employee has worked for KORADO-Bulgaria AD for 10 years or more, the
retirement benefit amounts to six gross monthly salaries upon retirement, if he/she has worked for the Company
from 5 to 10 years – four gross monthly salaries, and if he/she has worked for less than five years - two gross
monthly salaries. An employee, who has worked for KORADO-Bulgaria AD for more than 20 years, shall be
entitled to receive 8 gross monthly salaries upon retirement. These retirement benefits are unfunded.
The components of the expenses for retirement benefits recognised in the statement of comprehensive income for
2023 and the liabilities recognised in the statement of financial position as at 31 December 2023 are as follows:
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
25
Financial statements in English are translation from the original in Bulgarian
12.2.Right of Use Assets
As at 31 December 2023 the carrying amount of the right of use assets (vehicles previously presented as finance
lease liabilities) is BGN 450 thousand (31 December 2022: BGN 557 thousand).
The carrying amount of the right of use asset could be analysed as follows:
Vehicles 31.12.2023 31.12.2022
BGN’000 BGN’000
Carrying amount
At 1 January 557 219
Additions – new lease contracts - 400
Termination of lease contracts (31) (17)
Depreciation for the year (76) (45)
At 31 December 450 557
In further detail, the movement of right of use asset and transfers to property, plant and equipment is shown below:
Right-of-use
assets
Cost BGN’000
At 1 January 2022 282
Additions 400
Disposals
Transferred to motor vehicles (PP&E) (17)
At 31 December 2022 665
At 1 January 2023 665
Additions -
Disposals
Transferred to motor vehicles (PP&E) (31)
At 31 December 2023 634
Accumulated depreciation:
At 1 January 2022 63
Depreciation charge for the period 53
Transferred to motor vehicles (PP&E) (8)
At 31 December 2022 108
At 1 January 2023 108
Depreciation charge for the period 76
Transferred to motor vehicles (PP&E) -
At 31 December 2023 184
Carrying value
At 1 January 2022 219
At 31 December 2022 557
At 31 December 2023 450
13. Retirement benefits
Pursuant to the requirement of the Bulgarian labour legislation and the Collective Labour Agreement, the Company
is obliged to pay two to six gross monthly salaries to its employees upon retirement, depending on the length of
their service in the Company. If an employee has worked for KORADO-Bulgaria AD for 10 years or more, the
retirement benefit amounts to six gross monthly salaries upon retirement, if he/she has worked for the Company
from 5 to 10 years – four gross monthly salaries, and if he/she has worked for less than five years - two gross
monthly salaries. An employee, who has worked for KORADO-Bulgaria AD for more than 20 years, shall be
entitled to receive 8 gross monthly salaries upon retirement. These retirement benefits are unfunded.
The components of the expenses for retirement benefits recognised in the statement of comprehensive income for
2023 and the liabilities recognised in the statement of financial position as at 31 December 2023 are as follows:
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
26
Financial statements in English are translation from the original in Bulgarian
13. Retirement benefits(continued)
Expenses for retirement benefits
2023 2022
BGN’000 BGN’000
Interest expense 28 3
Current service costs 95 18
Expenses for retirement benefits, recognised in profit and loss 123 21
Actuarial losses recognised in other comprehensive income 87 40
Changes in the present value of the retirement benefit obligation are as follows:
2023 2022
BGN’000 BGN’000
At 1 January 529 543
Interest expense 28 3
Current service costs 95 18
Benefits paid (220) (75)
Actuarial losses 87 40
31 December 519 529
The actuarial gains and losses arising from experience adjustments are at the amount of BGN (78) thousand (2022:
BGN (67) thousand), from changes in demographic assumptions are the amount of BGN (4) thousand (2022:
BGN 6 thousand), while those arising from changes in financial assumptions are BGN (5) thousand (2022: BGN
21 thousand).
The key assumptions used in determining the retirement benefit liability are stated in the table below:
31.12.2023 31.12.2022
Discount rate 4,5% 6%
Future salary increases 20% 10%
The tables below contain a quantitative sensitivity analysis of the retirement benefit liability as at 31 December
2023 and 31 December 2022:
Sensitivity level Interest rate Salary growth
Assumptions 2023
Increase by
1%
Decrease
by 1%
Increase by
1%
Decrease
by 1%
BGN’000 BGN’000 BGN’000 BGN’000
Effect on the pension liability increase/(decrease) 54 (44) 50 (48)
Assumptions 2022
Effect on the pension liability increase/(decrease) (47) 54 48 (43)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
26
Financial statements in English are translation from the original in Bulgarian
13. Retirement benefits(continued)
Expenses for retirement benefits
2023 2022
BGN’000 BGN’000
Interest expense 28 3
Current service costs 95 18
Expenses for retirement benefits, recognised in profit and loss 123 21
Actuarial losses recognised in other comprehensive income 87 40
Changes in the present value of the retirement benefit obligation are as follows:
2023 2022
BGN’000 BGN’000
At 1 January 529 543
Interest expense 28 3
Current service costs 95 18
Benefits paid (220) (75)
Actuarial losses 87 40
31 December 519 529
The actuarial gains and losses arising from experience adjustments are at the amount of BGN (78) thousand (2022:
BGN (67) thousand), from changes in demographic assumptions are the amount of BGN (4) thousand (2022:
BGN 6 thousand), while those arising from changes in financial assumptions are BGN (5) thousand (2022: BGN
21 thousand).
The key assumptions used in determining the retirement benefit liability are stated in the table below:
31.12.2023 31.12.2022
Discount rate 4,5% 6%
Future salary increases 20% 10%
The tables below contain a quantitative sensitivity analysis of the retirement benefit liability as at 31 December
2023 and 31 December 2022:
Sensitivity level Interest rate Salary growth
Assumptions 2023
Increase by
1%
Decrease
by 1%
Increase by
1%
Decrease
by 1%
BGN’000 BGN’000 BGN’000 BGN’000
Effect on the pension liability increase/(decrease) 54 (44) 50 (48)
Assumptions 2022
Effect on the pension liability increase/(decrease) (47) 54 48 (43)
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
27
Financial statements in English are translation from the original in Bulgarian
14. Trade and other payables
2023 2022
BGN’000 BGN’000
Payables to suppliers 2,746 1,461
Payables to personnel 346 328
Payables for social securities 166 123
Other liabilities 104 89
3,362 2,001
Terms and conditions of the financial liabilities, set out in the table above, are as follows:
• Trade payables are non-interest bearing and are normally settled on 30- 60 day’s term;
• Tax payables are non-interest bearing and are settled within the legal deadlines;
• Other payables are non- interest bearing and are normally settled on 30 day’s term.
As at 31 December 2023 trade and other payables of BGN 2,001 thousand (31 December 2022:
BGN 1,486 thousand) are denominated in Euro and BGN 1,361 thousand (31 December 2022: 515 thousand) are
denominated in Bulgarian leva.
15. Provisions
As at 31 December 2023 and 31 December 2022 provisions consist of unused paid leave provisions at the amount
of BGN 223 thousand and BGN 107 thousand, respectively, and as at 31 December 2023 the Company also
allocated a provision for litigations at the amount of BGN 41 thousand.
16. Related party disclosures
Ultimate parent company
The ultimate parent company is KORADO a.s., Czech Republic.
Entities with controlling interest in the Company
At 31 December 2023, 82,15% of the shares of KORADO-Bulgaria AD are held by KORADO a.s., Czech
Republic. The remaining 17,85% of the shares are held by legal entities and individuals.
Besides with the parent company, KORADO a.s., Czech Republic, in 2023 and 2022 the Company concluded
transactions with other related companies as well, namely Licon Heat s.r.o., Czech Republic (a subsidiary of
KORADO a.s., Czech Republic).
The following table provides the total amount of related party transactions and the outstanding balances for the
current and previous reporting period:
Nature 2023 2023
BGN’000 BGN’000
Purchases from related parties
Ultimate parent company
KORADO a.s. Czech Republic Purchase of materials and goods 848 1,822
Purchase of services 327 309
Interest on loan 163 85
Licon Heat s.r.o. Czech Republic Purchase of materials and goods 72 79
1,410 2,295
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
27
Financial statements in English are translation from the original in Bulgarian
14. Trade and other payables
2023 2022
BGN’000 BGN’000
Payables to suppliers 2,746 1,461
Payables to personnel 346 328
Payables for social securities 166 123
Other liabilities 104 89
3,362 2,001
Terms and conditions of the financial liabilities, set out in the table above, are as follows:
• Trade payables are non-interest bearing and are normally settled on 30- 60 day’s term;
• Tax payables are non-interest bearing and are settled within the legal deadlines;
• Other payables are non- interest bearing and are normally settled on 30 day’s term.
As at 31 December 2023 trade and other payables of BGN 2,001 thousand (31 December 2022:
BGN 1,486 thousand) are denominated in Euro and BGN 1,361 thousand (31 December 2022: 515 thousand) are
denominated in Bulgarian leva.
15. Provisions
As at 31 December 2023 and 31 December 2022 provisions consist of unused paid leave provisions at the amount
of BGN 223 thousand and BGN 107 thousand, respectively, and as at 31 December 2023 the Company also
allocated a provision for litigations at the amount of BGN 41 thousand.
16. Related party disclosures
Ultimate parent company
The ultimate parent company is KORADO a.s., Czech Republic.
Entities with controlling interest in the Company
At 31 December 2023, 82,15% of the shares of KORADO-Bulgaria AD are held by KORADO a.s., Czech
Republic. The remaining 17,85% of the shares are held by legal entities and individuals.
Besides with the parent company, KORADO a.s., Czech Republic, in 2023 and 2022 the Company concluded
transactions with other related companies as well, namely Licon Heat s.r.o., Czech Republic (a subsidiary of
KORADO a.s., Czech Republic).
The following table provides the total amount of related party transactions and the outstanding balances for the
current and previous reporting period:
Nature 2023 2023
BGN’000 BGN’000
Purchases from related parties
Ultimate parent company
KORADO a.s. Czech Republic Purchase of materials and goods 848 1,822
Purchase of services 327 309
Interest on loan 163 85
Licon Heat s.r.o. Czech Republic Purchase of materials and goods 72 79
1,410 2,295
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
28
Financial statements in English are translation from the original in Bulgarian
16. Related party disclosures (continued)
Nature 2023 2023
BGN’000 BGN’000
Sales to related parties
Ultimate parent company
KORADO a.s. Czech Republic Sales of products 33,082 46,924
Sales of materials 15 11
33,097 46,935
Nature 31.12.2023 31.12.2022
BGN’000 BGN’000
Related party receivables
Ultimate parent company
KORADO a.s. Czech Republic Trade receivables 8,812 4,023
8,812 4,023
Payables to related parties Nature 31.12.2023 31.12.2022
BGN’000 BGN’000
Ultimate parent company
KORADO a.s. Czech Republic Interest-bearing loan 2,347 6,063
KORADO a.s. Czech Republic Trade payables 64 787
KORADO a.s. Czech Republic Trade interest - 36
Licon Heat s.r.o. Czech Republic Trade payables 5 -
2,416 6,886
Agreements were concluded and executed under which a portion of trade receivables amounting to BGN 2,096
thousand (31 December 2022: BGN 2,181 thousand) due from related parties were settled against trade payables
of BGN 1,898 thousand (31 December 2022: BGN 2,132 thousand) and interest payable of BGN 198 thousand
(31 December 2022: BGN 49 thousand and interest payable) without payment.
As at 31 December 2023and 31 December 2022 receivables from related parties of BGN 3,592 thousand (31
December 2022: BGN 0 thousand) are overdue within 30 days.
The receivables from related parties are subject to individual credit risk assessment, which takes into consideration
the available qualitative and non-statistical quantitative information. Based on this information, the management
has not accrued impairment loss allowance for the receivables from related parties as at 31 December 2023 and 31
December 2022 as it is insignificant.
All receivables and payables to related parties as at 31 December 2023 and 31 December 2022 are denominated
in euro.
Interest-bearing loan and borrowings from a related party
The first tranche of BGN 1,174 thousand of a loan from KORADO a.s. Czech Republic was received in February
2016, and in April 2016 the second tranche of BGN 3,520 thousand. The loan amounted to BGN 4,694 thousand.
The main purpose of these funds was to finance the acquisition and implementation of a production line for tube
heating units and renovation of production facilities. The loan was long-term and with initial maturity in 2022.
The agreed interest rate is 1 М EURBOR+ a fixed margin of 1. 00%. As of 31 December2023, the loan has been
repaid.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
28
Financial statements in English are translation from the original in Bulgarian
16. Related party disclosures (continued)
Nature 2023 2023
BGN’000 BGN’000
Sales to related parties
Ultimate parent company
KORADO a.s. Czech Republic Sales of products 33,082 46,924
Sales of materials 15 11
33,097 46,935
Nature 31.12.2023 31.12.2022
BGN’000 BGN’000
Related party receivables
Ultimate parent company
KORADO a.s. Czech Republic Trade receivables 8,812 4,023
8,812 4,023
Payables to related parties Nature 31.12.2023 31.12.2022
BGN’000 BGN’000
Ultimate parent company
KORADO a.s. Czech Republic Interest-bearing loan 2,347 6,063
KORADO a.s. Czech Republic Trade payables 64 787
KORADO a.s. Czech Republic Trade interest - 36
Licon Heat s.r.o. Czech Republic Trade payables 5 -
2,416 6,886
Agreements were concluded and executed under which a portion of trade receivables amounting to BGN 2,096
thousand (31 December 2022: BGN 2,181 thousand) due from related parties were settled against trade payables
of BGN 1,898 thousand (31 December 2022: BGN 2,132 thousand) and interest payable of BGN 198 thousand
(31 December 2022: BGN 49 thousand and interest payable) without payment.
As at 31 December 2023and 31 December 2022 receivables from related parties of BGN 3,592 thousand (31
December 2022: BGN 0 thousand) are overdue within 30 days.
The receivables from related parties are subject to individual credit risk assessment, which takes into consideration
the available qualitative and non-statistical quantitative information. Based on this information, the management
has not accrued impairment loss allowance for the receivables from related parties as at 31 December 2023 and 31
December 2022 as it is insignificant.
All receivables and payables to related parties as at 31 December 2023 and 31 December 2022 are denominated
in euro.
Interest-bearing loan and borrowings from a related party
The first tranche of BGN 1,174 thousand of a loan from KORADO a.s. Czech Republic was received in February
2016, and in April 2016 the second tranche of BGN 3,520 thousand. The loan amounted to BGN 4,694 thousand.
The main purpose of these funds was to finance the acquisition and implementation of a production line for tube
heating units and renovation of production facilities. The loan was long-term and with initial maturity in 2022.
The agreed interest rate is 1 М EURBOR+ a fixed margin of 1. 00%. As of 31 December2023, the loan has been
repaid.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
29
Financial statements in English are translation from the original in Bulgarian
16. Related party disclosures (continued)
In October 2022, a new loan was received from KORADO a.s. Czech Republic in the amount of BGN 2,347
thousand. These funds are intended for the purchase of raw materials. The loan is long-term, with an initial
repayment period of December 31, 2027. The interest rate is 1M EURBOR+1.00 fixed margin.
31.12.2023 31.12.2022
BGN’000 BGN’000
Borrowings from related parties
Ultimate parent company
KORADO a.s. Czech Republic 2,347 6,063
2,347 6,063
Changes in borrowings is as follows:
2023 2022
BGN’000 BGN’000
At 1 January 6,063 3,716
New credit - 2,347
Interest expense 163 85
Interest offset to trade receivables (3,879) (49)
Outstanding interest presented in current payables to related parties - (36)
At 31 December 2,347 6,063
Terms of the transactions with related parties
Sales and purchases to/from related parties are at contractual prices. The outstanding trade payables and
receivables at year end are unsecured, interest-free (except for loans) and their settlement is done with cash. For
the payables to or receivables from related parties, there are no guarantees received or issued. The Company did
not impair its related party receivables as of 31 December 2023 and 31 December 2022. A review for impairment
of the related party receivables is performed at the end of each year and is based on the financial performance of
the related party and the market it operates on, including actual cash flow settlements.
Remuneration to key management staff 2023 2022
BGN’000 BGN’000
Short-term benefits of MB and SB 94 94
Short-term benefits of AC 35 33
129 127
No post employment benefits or share based payments are provided to key management staff.
17. Commitments and contingencies
Legal claims
No material legal claims have been brought against the Company. The Company has allocated a provision for
litigations as disclosed in Note 15.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
29
Financial statements in English are translation from the original in Bulgarian
16. Related party disclosures (continued)
In October 2022, a new loan was received from KORADO a.s. Czech Republic in the amount of BGN 2,347
thousand. These funds are intended for the purchase of raw materials. The loan is long-term, with an initial
repayment period of December 31, 2027. The interest rate is 1M EURBOR+1.00 fixed margin.
31.12.2023 31.12.2022
BGN’000 BGN’000
Borrowings from related parties
Ultimate parent company
KORADO a.s. Czech Republic 2,347 6,063
2,347 6,063
Changes in borrowings is as follows:
2023 2022
BGN’000 BGN’000
At 1 January 6,063 3,716
New credit - 2,347
Interest expense 163 85
Interest offset to trade receivables (3,879) (49)
Outstanding interest presented in current payables to related parties - (36)
At 31 December 2,347 6,063
Terms of the transactions with related parties
Sales and purchases to/from related parties are at contractual prices. The outstanding trade payables and
receivables at year end are unsecured, interest-free (except for loans) and their settlement is done with cash. For
the payables to or receivables from related parties, there are no guarantees received or issued. The Company did
not impair its related party receivables as of 31 December 2023 and 31 December 2022. A review for impairment
of the related party receivables is performed at the end of each year and is based on the financial performance of
the related party and the market it operates on, including actual cash flow settlements.
Remuneration to key management staff 2023 2022
BGN’000 BGN’000
Short-term benefits of MB and SB 94 94
Short-term benefits of AC 35 33
129 127
No post employment benefits or share based payments are provided to key management staff.
17. Commitments and contingencies
Legal claims
No material legal claims have been brought against the Company. The Company has allocated a provision for
litigations as disclosed in Note 15.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
30
Financial statements in English are translation from the original in Bulgarian
17. Commitments and contingencies (continued)
Other
The last tax audit by the tax administration authorities covered the following types of liabilities, by periods:
• Corporate income tax – until 31 December 2010;
• VAT – until 31 July 2008;
• Personal income tax – until 31 December 2007;
• Social security – until 31 January 2012; 30 September 2009
• Local taxes and charges – until 31 December 2006;
• Income tax foreign legal entities - until 31 December 2013.
The Company’s management believes that no material risks exist as a result of the dynamic fiscal and regulatory
environment in Bulgaria, which might require adjustments in the financial statements for the period ended 31
December 2023.
18. Fair value of financial instruments
Set out below is a comparison by class of carrying amounts and fair values of all of the Company’s financial
instruments that are carried in the financial statements:
Book value Fair value
31.12.2023 31.12.2022 31.12.2023 31.12.2022
BGN’000 BGN’000 BGN’000 BGN’000
Financial assets
Trade receivables 9 197 9 197
Related party receivables 8,812 4,023 8,812 4,023
Cash and short-term deposits 1,296 489 2,823 489
Book value Fair value
31.12.2023 31.12.2022 31.12.2023 31.12.2022
BGN’000 BGN’000 BGN’000 BGN’000
Financial liabilities
Interest-bearing borrowings to related parties 2,347 6,063 2,347 6,063
Trade payables 2,746 1,461 2,746 1,461
Payables to related parties 69 823 69 823
The fair value of the financial instruments of the Company is determined as the price at which a financial asset
could be sold or a financial liability could be transferred in an arm’s length transaction between market participants
at the date of the valuation. The following methods and assumptions were used to estimate the fair values:
• Cash and cash equivalents, trade receivables, trade payables, and other current assets and liabilities
approximate - their fair values approximate their book values due to the short-term maturities of these instruments;
• Interest-bearing loans and borrowings - the fair value is estimated by applying the DCF model and using
a discount factor based on the interest rates for debt instruments of similar terms and remaining maturities.
The Company’s principal financial liabilities comprise interest -bearing loans and borrowings, and trade payables.
The main objective of these financial instruments is to secure financing for the Company's operations. The
Company holds financial assets such as trade receivables, cash and short-term deposits, which arise directly as a
result of its operation. As of 31 December 2023, and 31 December 2022 the Company neither held nor traded in
derivative financial instruments.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
30
Financial statements in English are translation from the original in Bulgarian
17. Commitments and contingencies (continued)
Other
The last tax audit by the tax administration authorities covered the following types of liabilities, by periods:
• Corporate income tax – until 31 December 2010;
• VAT – until 31 July 2008;
• Personal income tax – until 31 December 2007;
• Social security – until 31 January 2012; 30 September 2009
• Local taxes and charges – until 31 December 2006;
• Income tax foreign legal entities - until 31 December 2013.
The Company’s management believes that no material risks exist as a result of the dynamic fiscal and regulatory
environment in Bulgaria, which might require adjustments in the financial statements for the period ended 31
December 2023.
18. Fair value of financial instruments
Set out below is a comparison by class of carrying amounts and fair values of all of the Company’s financial
instruments that are carried in the financial statements:
Book value Fair value
31.12.2023 31.12.2022 31.12.2023 31.12.2022
BGN’000 BGN’000 BGN’000 BGN’000
Financial assets
Trade receivables 9 197 9 197
Related party receivables 8,812 4,023 8,812 4,023
Cash and short-term deposits 1,296 489 2,823 489
Book value Fair value
31.12.2023 31.12.2022 31.12.2023 31.12.2022
BGN’000 BGN’000 BGN’000 BGN’000
Financial liabilities
Interest-bearing borrowings to related parties 2,347 6,063 2,347 6,063
Trade payables 2,746 1,461 2,746 1,461
Payables to related parties 69 823 69 823
The fair value of the financial instruments of the Company is determined as the price at which a financial asset
could be sold or a financial liability could be transferred in an arm’s length transaction between market participants
at the date of the valuation. The following methods and assumptions were used to estimate the fair values:
• Cash and cash equivalents, trade receivables, trade payables, and other current assets and liabilities
approximate - their fair values approximate their book values due to the short-term maturities of these instruments;
• Interest-bearing loans and borrowings - the fair value is estimated by applying the DCF model and using
a discount factor based on the interest rates for debt instruments of similar terms and remaining maturities.
The Company’s principal financial liabilities comprise interest -bearing loans and borrowings, and trade payables.
The main objective of these financial instruments is to secure financing for the Company's operations. The
Company holds financial assets such as trade receivables, cash and short-term deposits, which arise directly as a
result of its operation. As of 31 December 2023, and 31 December 2022 the Company neither held nor traded in
derivative financial instruments.
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
31
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy
The major risks arising from the Company’s financial instruments are liquidity risk, foreign currency risk, interest
risk and credit risk. The risk management policy the Company’s management implemented to manage these risks
is summarized below.
Interest rate risk
The Company is exposed to the risk of changes in market interest rates primarily to its short-term and long-term
financial liabilities in the form of a related party loan at the amount of BGN 2,347 thousand bearing floating
(variable) interest rate based on 1-month Euribor and margin of 1.00%.
The following table demonstrates the sensitivity to possible changes in interest rates of the Company’s profit before
tax (through the effect on variable rate loans and borrowings), with all other variables held constant. There is no
effect on other equity components of the Company.
Increase/
Decrease in
interest rates
Effect on the pre-
tax profit
BGN’000
31 December 2023
In EUR +0.5% (1)
In EUR -1% 2
Increase/
Decrease in
interest rates
Effect on the pre-
tax profit
BGN’000
31 December 2022
In EUR +0.5% (19)
In EUR -1% 37
Liquidity risk
The effective management of the Company’s liquidity presumes that sufficient working capital will be ensured
mainly through maintenance of sufficient cash and other current assets and financing from related parties.
Company’s quick ratio, calculated as current assets over current liabilities is 4.55 in 2023 (2022: 5.67), which
shows an appropriate ability of the Company to settle its liabilities coming due over the next 12 months.
At 31 December 2023 and 31 December 2022, the maturity structure of the Company’s financial liabilities, based
on the agreed undiscounted payments, is presented below:
At 31 December 2023
On demand
< 3
months
3-12
months
1-5
year > 5 years Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Lease liabilities - - 120 151 - 271
Trade payables - 2,746 - - - 2,746
Payables to related parties - 69 - - - 69
Interest-bearing loans and
borrowings - - 2,369 - 2,369
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
31
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy
The major risks arising from the Company’s financial instruments are liquidity risk, foreign currency risk, interest
risk and credit risk. The risk management policy the Company’s management implemented to manage these risks
is summarized below.
Interest rate risk
The Company is exposed to the risk of changes in market interest rates primarily to its short-term and long-term
financial liabilities in the form of a related party loan at the amount of BGN 2,347 thousand bearing floating
(variable) interest rate based on 1-month Euribor and margin of 1.00%.
The following table demonstrates the sensitivity to possible changes in interest rates of the Company’s profit before
tax (through the effect on variable rate loans and borrowings), with all other variables held constant. There is no
effect on other equity components of the Company.
Increase/
Decrease in
interest rates
Effect on the pre-
tax profit
BGN’000
31 December 2023
In EUR +0.5% (1)
In EUR -1% 2
Increase/
Decrease in
interest rates
Effect on the pre-
tax profit
BGN’000
31 December 2022
In EUR +0.5% (19)
In EUR -1% 37
Liquidity risk
The effective management of the Company’s liquidity presumes that sufficient working capital will be ensured
mainly through maintenance of sufficient cash and other current assets and financing from related parties.
Company’s quick ratio, calculated as current assets over current liabilities is 4.55 in 2023 (2022: 5.67), which
shows an appropriate ability of the Company to settle its liabilities coming due over the next 12 months.
At 31 December 2023 and 31 December 2022, the maturity structure of the Company’s financial liabilities, based
on the agreed undiscounted payments, is presented below:
At 31 December 2023
On demand
< 3
months
3-12
months
1-5
year > 5 years Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Lease liabilities - - 120 151 - 271
Trade payables - 2,746 - - - 2,746
Payables to related parties - 69 - - - 69
Interest-bearing loans and
borrowings - - 2,369 - 2,369
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
32
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy (continued)
Liquidity risk (continued)
At 31 December 2022
On demand
< 3
months
3-12
months
1-5
year > 5 years Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Lease liabilities - - 131 268 - 399
Trade payables - 1,461 - - - 1,461
Payables to related parties - 823 - - - 823
Interest-bearing loans and
borrowings - - 129 6,354 - 6,483
Currency risk
The Company performs purchases, sales, and receives loans in foreign currencies – EUR. Since the exchange rate
BGN/EUR is fixed at ratio of EUR 1: BGN 1.95583, the currency risk relating to the EUR exposures of the
Company is immaterial. The FX gains and losses reported by the Company are the outcome of the bid-ask spread
on the fixed rate.
Credit risk
The Company trades only with recognised, creditworthy contractors. It is the Company’s policy that all customers
who wish to trade on credit terms are subject to credit verification procedures. Moreover, the trade receivable
balances are monitored currently, and as a result of that the Company’s exposure to bad and doubtful debts is
insignificant. There are no significant concentrations of credit risk within the Company. With respect to credit risk
arising from the other financial assets of the Company, which comprise cash and other financial assets, the
Company’s credit exposure arises from default of its counterparties.
The maximum credit exposure of the Company in relation to the recognised financial assets equals their respective
carrying amount as per the statement of financial position as at 31 December 2023.
Cash transactions are made only with financial institutions with high credit ratings. Cash and cash equivalents are
held with banks having a credit rating of BBB or higher or those with an excellent longstanding goodwill.
Approximately 98% (31 December 2022: 81%) of the cash and cash equivalents are concentrated in one bank.
Credit quality of financial assets
The credit quality of financial assets can be assessed by reference to external credit ratings (if available) or to
historical information about counterparty default rates:
31.12.2023 31.12.2022
BGN’000 BGN’000
Existing customers
Trade receivables 9 197
Receivables from related parties 8,812 4,023
Cash and cash equivalents
A- (Fitch) 1,138 280
Banks with no credit rating 148 203
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
32
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy (continued)
Liquidity risk (continued)
At 31 December 2022
On demand
< 3
months
3-12
months
1-5
year > 5 years Total
BGN’000 BGN’000 BGN’000 BGN’000 BGN’000 BGN’000
Lease liabilities - - 131 268 - 399
Trade payables - 1,461 - - - 1,461
Payables to related parties - 823 - - - 823
Interest-bearing loans and
borrowings - - 129 6,354 - 6,483
Currency risk
The Company performs purchases, sales, and receives loans in foreign currencies – EUR. Since the exchange rate
BGN/EUR is fixed at ratio of EUR 1: BGN 1.95583, the currency risk relating to the EUR exposures of the
Company is immaterial. The FX gains and losses reported by the Company are the outcome of the bid-ask spread
on the fixed rate.
Credit risk
The Company trades only with recognised, creditworthy contractors. It is the Company’s policy that all customers
who wish to trade on credit terms are subject to credit verification procedures. Moreover, the trade receivable
balances are monitored currently, and as a result of that the Company’s exposure to bad and doubtful debts is
insignificant. There are no significant concentrations of credit risk within the Company. With respect to credit risk
arising from the other financial assets of the Company, which comprise cash and other financial assets, the
Company’s credit exposure arises from default of its counterparties.
The maximum credit exposure of the Company in relation to the recognised financial assets equals their respective
carrying amount as per the statement of financial position as at 31 December 2023.
Cash transactions are made only with financial institutions with high credit ratings. Cash and cash equivalents are
held with banks having a credit rating of BBB or higher or those with an excellent longstanding goodwill.
Approximately 98% (31 December 2022: 81%) of the cash and cash equivalents are concentrated in one bank.
Credit quality of financial assets
The credit quality of financial assets can be assessed by reference to external credit ratings (if available) or to
historical information about counterparty default rates:
31.12.2023 31.12.2022
BGN’000 BGN’000
Existing customers
Trade receivables 9 197
Receivables from related parties 8,812 4,023
Cash and cash equivalents
A- (Fitch) 1,138 280
Banks with no credit rating 148 203
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
33
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy (continued)
Impairment of financial assets
The Company has the following financial assets, which are subject to the expected credit loss model:
• Trade receivables
• Cash and cash equivalents
The Company applies the IFRS 9 simplified approach to measure expected credit losses which uses a lifetime
expected loss allowance for all trade receivables. To measure the expected credit losses, trade receivables have
been analysed on an individual basis. The expected loss rates are based on the payment profiles of sales over a
period of 24 month before 31 December 2023 or 31 December 2022 respectively and the corresponding historical
credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-
looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.
Based on this analysis, the Company concluded that all trade receivables are paid within 60 days and no receivables
were written off in the period analysed..
Cash and cash equivalents are also subject to the impairment requirements of IFRS 9, but the impairment loss was
immaterial.
Impairment of financial assets (continued)
Trade receivables and contract assets are written off when there is no reasonable expectation of recovery. Indicators
that there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a
repayment plan with the group, and a failure to make contractual payments for a period of greater than 120 days
past due. Impairment losses on trade receivables and contract assets are presented as net impairment losses within
operating profit. Subsequent recoveries of amounts previously written off are credited against the same line item.
Capital management
The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating
and healthy capital ratios to support its business and maximise owner’s value.
The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions.
To maintain or adjust the capital structure, the Company may adjust the payment of dividends to the shareholders,
to redeem its treasury shares, to increase or decrease its share capital, by decision of the shareholders. No changes
were made in the objectives, policies or processes for managing the Company’s capital during 202 3 and 2022.
The Company monitors its equity through the realized financial result for the reporting period ending 31 December
2023 and 31 December 2022, as follows:
2023 2022
BGN’000 BGN’000
Net profit 3,569 4,382
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
33
Financial statements in English are translation from the original in Bulgarian
19. Financial risk management objectives and policy (continued)
Impairment of financial assets
The Company has the following financial assets, which are subject to the expected credit loss model:
• Trade receivables
• Cash and cash equivalents
The Company applies the IFRS 9 simplified approach to measure expected credit losses which uses a lifetime
expected loss allowance for all trade receivables. To measure the expected credit losses, trade receivables have
been analysed on an individual basis. The expected loss rates are based on the payment profiles of sales over a
period of 24 month before 31 December 2023 or 31 December 2022 respectively and the corresponding historical
credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-
looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.
Based on this analysis, the Company concluded that all trade receivables are paid within 60 days and no receivables
were written off in the period analysed..
Cash and cash equivalents are also subject to the impairment requirements of IFRS 9, but the impairment loss was
immaterial.
Impairment of financial assets (continued)
Trade receivables and contract assets are written off when there is no reasonable expectation of recovery. Indicators
that there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a
repayment plan with the group, and a failure to make contractual payments for a period of greater than 120 days
past due. Impairment losses on trade receivables and contract assets are presented as net impairment losses within
operating profit. Subsequent recoveries of amounts previously written off are credited against the same line item.
Capital management
The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating
and healthy capital ratios to support its business and maximise owner’s value.
The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions.
To maintain or adjust the capital structure, the Company may adjust the payment of dividends to the shareholders,
to redeem its treasury shares, to increase or decrease its share capital, by decision of the shareholders. No changes
were made in the objectives, policies or processes for managing the Company’s capital during 202 3 and 2022.
The Company monitors its equity through the realized financial result for the reporting period ending 31 December
2023 and 31 December 2022, as follows:
2023 2022
BGN’000 BGN’000
Net profit 3,569 4,382
KORADO-BULGARIA AD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
34
Financial statements in English are translation from the original in Bulgarian
20. Reconciliation of the movements in liabilities the cash flows of which are presented in financing activity
Borrowings Lease
liabilities
Retained
earnings
Total
BGN’000 BGN’000 BGN’000 BGN’000
At 1 January 2022 3,716 166 8,391 12,273
Cash flows 2,347 (196) (3,819) (1,668)
New leasing contracts - 400 - 400
Interest expense 85 7 - 92
Profit for the year - - 4,382 4,382
Non-cash transactions (49) - - (49)
Interest payables presented in current
liabilities to related parties (36) - - (36)
At 31 December 2022 6,063 377 8,954 15,394
At 1 January 2023 6,063 377 8,954 15,394
Cash flows - (122) (1,318) (1,440)
Other - - 2 2
Interest expense 163 - - 163
Profit for the year - - 3,569 3,569
Non-cash transactions (3,716) - - (3,716)
Interest payables presented in current
liabilities to related parties (163) - (163)
At 31 December 2023 2,347 255 11,207 13,809
21. Events after the reporting date
No events have occurred after the reporting date, which require additional adjustments and/or disclosures in the
Company’s financial statements.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
At 31 DECEMBER 2023
34
Financial statements in English are translation from the original in Bulgarian
20. Reconciliation of the movements in liabilities the cash flows of which are presented in financing activity
Borrowings Lease
liabilities
Retained
earnings
Total
BGN’000 BGN’000 BGN’000 BGN’000
At 1 January 2022 3,716 166 8,391 12,273
Cash flows 2,347 (196) (3,819) (1,668)
New leasing contracts - 400 - 400
Interest expense 85 7 - 92
Profit for the year - - 4,382 4,382
Non-cash transactions (49) - - (49)
Interest payables presented in current
liabilities to related parties (36) - - (36)
At 31 December 2022 6,063 377 8,954 15,394
At 1 January 2023 6,063 377 8,954 15,394
Cash flows - (122) (1,318) (1,440)
Other - - 2 2
Interest expense 163 - - 163
Profit for the year - - 3,569 3,569
Non-cash transactions (3,716) - - (3,716)
Interest payables presented in current
liabilities to related parties (163) - (163)
At 31 December 2023 2,347 255 11,207 13,809
21. Events after the reporting date
No events have occurred after the reporting date, which require additional adjustments and/or disclosures in the
Company’s financial statements.
KORADO-BULGARIA AD
DECLARATION
At 31 DECEMBER 2023
35
D E C L A R A T I O N
under Art. 100m, paragraph 4, item 4of POSA
The undersigned, JIRI REZNICEK, Executive Director, and Silviya Stefanova, Head of Finance
Department and preparer of the financial statements of KORADO-Bulgaria AD, town of Strazhitsa,
HEREBY DECLARE that to the best of our knowledge and belief:
1. The set of financial statements as at 31 December 2023 drawn up in accordance with the applicable
accounting standards give a true and fair view of the assets, liabilities, financial position and financial
performance of the Company;
2. The management activity report includes a fair review of the development and the performance of the
business and the position of the Company, together with a description of the principal risks and
uncertainties that the Company faces.
DECLARANTS:
Head of Finance Department: Executive Director:
Silviya Stefanova Eng. JIRI REZNICEK
DECLARATION
At 31 DECEMBER 2023
35
D E C L A R A T I O N
under Art. 100m, paragraph 4, item 4of POSA
The undersigned, JIRI REZNICEK, Executive Director, and Silviya Stefanova, Head of Finance
Department and preparer of the financial statements of KORADO-Bulgaria AD, town of Strazhitsa,
HEREBY DECLARE that to the best of our knowledge and belief:
1. The set of financial statements as at 31 December 2023 drawn up in accordance with the applicable
accounting standards give a true and fair view of the assets, liabilities, financial position and financial
performance of the Company;
2. The management activity report includes a fair review of the development and the performance of the
business and the position of the Company, together with a description of the principal risks and
uncertainties that the Company faces.
DECLARANTS:
Head of Finance Department: Executive Director:
Silviya Stefanova Eng. JIRI REZNICEK
Deloitte Audit OOD
UIC 121145199
4 Mihail Tenev Str., fl. 12
Balkan Business Center
1784 Sofia, Bulgaria
Tel: +359 (2) 802 3300
Fax: +359 (2) 802 3350
www.deloitte.bg
Делойт Одит ООД
ЕИК 121145199
ул. Михаил Тенев 4, ет. 12
Балкан Бизнес Център
1784 София, България
Tел: +359 (2) 802 3300
Факс: +359 (2) 802 3350
Делойт се отнася към едно или повече дружества - членове на Делойт Туш Томацу Лимитид („ДТТЛ“ ), както и към глобалната мрежа от дружества – членове и
свързаните с тях дружества (заедно наричани „организацията на Делойт). ДТТЛ (наричано също “Делойт Глобъл“) и всяко дружество– член и неговите свързани
дружества са юридически самостоятелни и независими лица, които не могат да поемат задължения или да се обвързват взаимно по отношение на трети страни.
ДТТЛ и всяко дружество член на ДТТЛ и свързаните с него дружества са отговорни единствено и само за своите собствени действия и бездействия, но не и за тези
на останалите. ДТТЛ не предоставя услуги на клиенти. Моля, посетете www.deloitte.com/about, за да научите повече.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte
organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot
obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each
other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
This document is a translation of the original Bulgarian text, in case
of divergence the Bulgarian original shall prevail
INDEPENDENT AUDITOR’S REPORT
To the shareholders of Korado-Bulgaria AD
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
Opinion
We have audited the accompanying financial statements of Korado-Bulgaria AD (the Company), which
comprise the statement of financial position as at December 31, 2023, and the statement of comprehensive
income, the statement of changes in equity and the statement of cash flows for the year then ended, and notes
to the financial statements, including material accounting policy information and other explanatory
information.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial
position of the Company as at December 31, 2023, and its financial performance and its cash flows for the
year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the
European Union (EU).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Company in accordance with the International
Code of Ethics for Professional Accountants (including International Independence Standards) of the
International Ethics Standards Board for Accountants (IESBA Code) together with the ethical requirements
of the Independent Financial Audit Act (IFAA) that are relevant to our audit of the financial statements in
Bulgaria, and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code and the
requirements of IFAA. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
UIC 121145199
4 Mihail Tenev Str., fl. 12
Balkan Business Center
1784 Sofia, Bulgaria
Tel: +359 (2) 802 3300
Fax: +359 (2) 802 3350
www.deloitte.bg
Делойт Одит ООД
ЕИК 121145199
ул. Михаил Тенев 4, ет. 12
Балкан Бизнес Център
1784 София, България
Tел: +359 (2) 802 3300
Факс: +359 (2) 802 3350
Делойт се отнася към едно или повече дружества - членове на Делойт Туш Томацу Лимитид („ДТТЛ“ ), както и към глобалната мрежа от дружества – членове и
свързаните с тях дружества (заедно наричани „организацията на Делойт). ДТТЛ (наричано също “Делойт Глобъл“) и всяко дружество– член и неговите свързани
дружества са юридически самостоятелни и независими лица, които не могат да поемат задължения или да се обвързват взаимно по отношение на трети страни.
ДТТЛ и всяко дружество член на ДТТЛ и свързаните с него дружества са отговорни единствено и само за своите собствени действия и бездействия, но не и за тези
на останалите. ДТТЛ не предоставя услуги на клиенти. Моля, посетете www.deloitte.com/about, за да научите повече.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte
organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot
obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each
other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
This document is a translation of the original Bulgarian text, in case
of divergence the Bulgarian original shall prevail
INDEPENDENT AUDITOR’S REPORT
To the shareholders of Korado-Bulgaria AD
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
Opinion
We have audited the accompanying financial statements of Korado-Bulgaria AD (the Company), which
comprise the statement of financial position as at December 31, 2023, and the statement of comprehensive
income, the statement of changes in equity and the statement of cash flows for the year then ended, and notes
to the financial statements, including material accounting policy information and other explanatory
information.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial
position of the Company as at December 31, 2023, and its financial performance and its cash flows for the
year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the
European Union (EU).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Company in accordance with the International
Code of Ethics for Professional Accountants (including International Independence Standards) of the
International Ethics Standards Board for Accountants (IESBA Code) together with the ethical requirements
of the Independent Financial Audit Act (IFAA) that are relevant to our audit of the financial statements in
Bulgaria, and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code and the
requirements of IFAA. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
2
Key audit matter How our audit addressed the key audit matter
Revenue Recognition
See Notes 1.2 (b) and 3.1 to the financial
statements
The Company had one major revenue stream in 2023
consisting of sale of finished products and goods for
resale, i.e. household heating radiators, amounting to
BGN 39,274 thousand.
Sales are recognized when control of the products
has transferred, being when the products are
delivered to the client, the client has full discretion
over the channel and price to sell the products, and
there is no unfulfilled obligation that could affect the
client’s acceptance of the products.
The finished products and goods for resale are often
sold with retrospective volume discounts based on
the aggregate sales over a 12 months period.
Revenue from these sales is recognized based on the
price specified in the contract, net of the estimated
volume discounts.
The majority of the revenue is derived from a limited
number of customers, who settle their due balances
within agreed terms. The sales to the parent
company represent approximately 85% of total
revenue. This structure of the Company’s sales is
driven by the business of the group the Company is
part of, where trading is centralized. The Company
is focused on the production of one of the major
products sold by the group.
The remuneration of the Management of the
Company is related to a certain extend to the
achievement of pre-defined results. There is a risk
that the management could influence the financial
statements to report better results. The financial
result could be potentially influenced by the
management through revenue recognition.
Due to the significance of the circumstances set out
above that: (a) revenue recognition is an area of
significant risk and requires significant time and
resource to audit; and (b) its significance as a whole
for the financial statements of the Company, we
have considered this matter as a key audit matter.
In this area, our audit procedures included,
among others:
• Inquiries and obtaining of an understanding
of the Company's process of revenue recognition.
• Review and assessment of the adequacy and
the consistency of application of the revenue
recognition policy of the Company. Our audit
procedures included also testing the adequacy of the
adopted accounting policy for revenue recognition
in accordance with the applicable standards.
• Assessment of design and implementation
of key controls over the revenue recognition process.
Tests of operating effectiveness of relevant controls,
with specific focus on the key control over matching
dispatch notes, issued invoices and cash receipts, as
well as over the confirmation of the documents
supporting credit notes, including those for
discounts.
Based on the procedures set out above, we
developed tailored audit procedures to enable us to
address the risk of material misstatement associated
with the revenue recognition, including that
management could influence the revenue
recognition.
Our substantive procedures consisted mainly of
confirming sales transactions for the year by sending
confirmation letters. With this procedure, based on
the received responses we confirmed a sample of the
annual revenues from selected clients.
We have tested selected revenue transactions
realized close after the year-end in order to assess
the recognition of revenue in the correct accounting
period.
We assessed the relevance and adequacy of the
disclosures in the Company's financial statements
related to revenue recognition and reporting.
Key audit matter How our audit addressed the key audit matter
Revenue Recognition
See Notes 1.2 (b) and 3.1 to the financial
statements
The Company had one major revenue stream in 2023
consisting of sale of finished products and goods for
resale, i.e. household heating radiators, amounting to
BGN 39,274 thousand.
Sales are recognized when control of the products
has transferred, being when the products are
delivered to the client, the client has full discretion
over the channel and price to sell the products, and
there is no unfulfilled obligation that could affect the
client’s acceptance of the products.
The finished products and goods for resale are often
sold with retrospective volume discounts based on
the aggregate sales over a 12 months period.
Revenue from these sales is recognized based on the
price specified in the contract, net of the estimated
volume discounts.
The majority of the revenue is derived from a limited
number of customers, who settle their due balances
within agreed terms. The sales to the parent
company represent approximately 85% of total
revenue. This structure of the Company’s sales is
driven by the business of the group the Company is
part of, where trading is centralized. The Company
is focused on the production of one of the major
products sold by the group.
The remuneration of the Management of the
Company is related to a certain extend to the
achievement of pre-defined results. There is a risk
that the management could influence the financial
statements to report better results. The financial
result could be potentially influenced by the
management through revenue recognition.
Due to the significance of the circumstances set out
above that: (a) revenue recognition is an area of
significant risk and requires significant time and
resource to audit; and (b) its significance as a whole
for the financial statements of the Company, we
have considered this matter as a key audit matter.
In this area, our audit procedures included,
among others:
• Inquiries and obtaining of an understanding
of the Company's process of revenue recognition.
• Review and assessment of the adequacy and
the consistency of application of the revenue
recognition policy of the Company. Our audit
procedures included also testing the adequacy of the
adopted accounting policy for revenue recognition
in accordance with the applicable standards.
• Assessment of design and implementation
of key controls over the revenue recognition process.
Tests of operating effectiveness of relevant controls,
with specific focus on the key control over matching
dispatch notes, issued invoices and cash receipts, as
well as over the confirmation of the documents
supporting credit notes, including those for
discounts.
Based on the procedures set out above, we
developed tailored audit procedures to enable us to
address the risk of material misstatement associated
with the revenue recognition, including that
management could influence the revenue
recognition.
Our substantive procedures consisted mainly of
confirming sales transactions for the year by sending
confirmation letters. With this procedure, based on
the received responses we confirmed a sample of the
annual revenues from selected clients.
We have tested selected revenue transactions
realized close after the year-end in order to assess
the recognition of revenue in the correct accounting
period.
We assessed the relevance and adequacy of the
disclosures in the Company's financial statements
related to revenue recognition and reporting.
3
Information Other than the Financial Statements and Auditor’s Report Thereon
Management Board of the Company (Management) is responsible for the other information. The other
information comprises the annual activity report, the corporate governance statement and the report on the
implementation of the policy on the remuneration, prepared by the management in accordance with Chapter
Seven of the Accountancy Act, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form
of assurance conclusion thereon, unless it is not specifically stated in our auditor’s report and to the extent it
is specifically stated.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based
on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with IFRSs as adopted by the EU, and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud
or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Supervisory Board and Audit Committee of the Company (Those charged with governance) are responsible
for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Information Other than the Financial Statements and Auditor’s Report Thereon
Management Board of the Company (Management) is responsible for the other information. The other
information comprises the annual activity report, the corporate governance statement and the report on the
implementation of the policy on the remuneration, prepared by the management in accordance with Chapter
Seven of the Accountancy Act, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form
of assurance conclusion thereon, unless it is not specifically stated in our auditor’s report and to the extent it
is specifically stated.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based
on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with IFRSs as adopted by the EU, and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud
or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Supervisory Board and Audit Committee of the Company (Those charged with governance) are responsible
for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
4
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Company to cease to continue as a going
concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not
be communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
Reporting in relation to the compliance with the electronic format of the financial statements, included
in the annual financial report on activities under Art. 100m, para 4 of the Public Offering of Securities
Act (POSA) with the requirements of the ESEF Regulation
In addition to our reporting responsibilities according to ISAs described in the section above Auditor’s
Responsibilities for the Audit of the Financial Statements , we performed the procedures in accordance with
the Guidelines on the issuing of audit opinion with respect to the application of the European Single
Electronic Format (ESEF) to the financial statements of companies which securities are admitted to trading
on a regulated market in the European Union (EU) by the Professional Organization of the Registered
Auditors in Bulgaria - Institute of Certified Public Accountants (ICPA). These procedures are related to the
verification of the structure and whether the human readable part of this electronic format corresponds to the
audited financial statements and issuing an opinion on the compliance of the electronic format of the
financial statements of Korado-Bulgaria AD for the year ending on December 31, 2023, attached in the
electronic file "8945006GNF19M54P6947-20231231-EN-SEP.xhtml", with the requirements of the
Commission Delegated Regulation (EU) 2019/815 from December 17, 2018 supplementing Directive
2004/109/EC of the European Parliament and of the Council by means of regulatory technical standards to
define the European Single Electronic Format for reporting (ESEF Regulation). Based on these requirements,
the electronic format of the financial statements included in the annual financial report on activities under
Art. 100m, para. 4 of POSA, should be presented in XHTML format.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Company to cease to continue as a going
concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not
be communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
Reporting in relation to the compliance with the electronic format of the financial statements, included
in the annual financial report on activities under Art. 100m, para 4 of the Public Offering of Securities
Act (POSA) with the requirements of the ESEF Regulation
In addition to our reporting responsibilities according to ISAs described in the section above Auditor’s
Responsibilities for the Audit of the Financial Statements , we performed the procedures in accordance with
the Guidelines on the issuing of audit opinion with respect to the application of the European Single
Electronic Format (ESEF) to the financial statements of companies which securities are admitted to trading
on a regulated market in the European Union (EU) by the Professional Organization of the Registered
Auditors in Bulgaria - Institute of Certified Public Accountants (ICPA). These procedures are related to the
verification of the structure and whether the human readable part of this electronic format corresponds to the
audited financial statements and issuing an opinion on the compliance of the electronic format of the
financial statements of Korado-Bulgaria AD for the year ending on December 31, 2023, attached in the
electronic file "8945006GNF19M54P6947-20231231-EN-SEP.xhtml", with the requirements of the
Commission Delegated Regulation (EU) 2019/815 from December 17, 2018 supplementing Directive
2004/109/EC of the European Parliament and of the Council by means of regulatory technical standards to
define the European Single Electronic Format for reporting (ESEF Regulation). Based on these requirements,
the electronic format of the financial statements included in the annual financial report on activities under
Art. 100m, para. 4 of POSA, should be presented in XHTML format.
5
The Management of the Company is responsible for the application of the requirements of the ESEF
Regulation in preparing the electronic format of the financial statements in XHTML.
Our report covers only the electronic format of the financial statements, attached in the electronic file
"8945006GNF19M54P6947-20231231-EN-SEP.xhtml" and does not cover the other information, included
in the annual financial report on activities under Art. 100m, para. 4 of the POSA.
Based on the procedures performed in our opinion, the electronic format of the financial statements of the
Company for the year ended December 31, 2023, contained in the attached electronic file
"8945006GNF19M54P6947-20231231-EN-SEP.xhtml", has been prepared in all material respects in
accordance with the requirements of the ESEF Regulation.
Additional Matters Required to be Reported by the Accountancy Act and Public Offering of Securities
Act (POSA)
In addition to our reporting responsibilities according to ISAs described in section Information Other than
the Financial Statements and Auditor’s Report Thereon, with respect to the annual activity report, the
corporate governance statement and the report on the implementation of the policy on the remuneration, we
have also performed the procedures, together with the required under ISAs, in accordance with the
Guidelines regarding new extended reports and communication by the auditor of the Professional
Organization of Registered Auditors in Bulgaria - Institute of Certified Public Accountants (ICPA). These
procedures include tests over the existence, form and content of the other information in order to assist us in
forming an opinion as to whether the other information includes the disclosures and reporting as required by
Chapter Seven of the Accountancy Act and the Public Offering of Securities Act (Art. 100m, paragraph 10
of POSA in relation to Art. 100m, paragraph 8, p. 3 and 4 of POSA, as well as Art. 100m, paragraph 13 of
POSA in relation to Art. 116c, paragraph 1 of POSA), applicable in Bulgaria.
Opinion under Art. 37, paragraph 6 of the Accountancy Act
Based on the procedures performed, in our opinion:
• The information included in the annual activity report for the financial year for which the financial
statements have been prepared, is consistent with the financial statements.
• The annual activity report has been prepared in accordance with the requirements of Chapter Seven of
the Accountancy Act and of Art. 100m, paragraph 7 of the Public Offering of Securities Act.
• The information required by Chapter Seven of the Accountancy Act and Art. 100m, paragraph 8 of
the Public Offering of Securities Act is presented in the corporate governance statement covering the
financial year for which the financial statements have been prepared.
• The report on the implementation of the policy on the remuneration, covering the financial year for
which the financial statements have been prepared, has been provided and meets the requirements
defined in the Ordinance referred to in Art. 116c, paragraph 1 of the Public Offering of Securities Act.
The Management of the Company is responsible for the application of the requirements of the ESEF
Regulation in preparing the electronic format of the financial statements in XHTML.
Our report covers only the electronic format of the financial statements, attached in the electronic file
"8945006GNF19M54P6947-20231231-EN-SEP.xhtml" and does not cover the other information, included
in the annual financial report on activities under Art. 100m, para. 4 of the POSA.
Based on the procedures performed in our opinion, the electronic format of the financial statements of the
Company for the year ended December 31, 2023, contained in the attached electronic file
"8945006GNF19M54P6947-20231231-EN-SEP.xhtml", has been prepared in all material respects in
accordance with the requirements of the ESEF Regulation.
Additional Matters Required to be Reported by the Accountancy Act and Public Offering of Securities
Act (POSA)
In addition to our reporting responsibilities according to ISAs described in section Information Other than
the Financial Statements and Auditor’s Report Thereon, with respect to the annual activity report, the
corporate governance statement and the report on the implementation of the policy on the remuneration, we
have also performed the procedures, together with the required under ISAs, in accordance with the
Guidelines regarding new extended reports and communication by the auditor of the Professional
Organization of Registered Auditors in Bulgaria - Institute of Certified Public Accountants (ICPA). These
procedures include tests over the existence, form and content of the other information in order to assist us in
forming an opinion as to whether the other information includes the disclosures and reporting as required by
Chapter Seven of the Accountancy Act and the Public Offering of Securities Act (Art. 100m, paragraph 10
of POSA in relation to Art. 100m, paragraph 8, p. 3 and 4 of POSA, as well as Art. 100m, paragraph 13 of
POSA in relation to Art. 116c, paragraph 1 of POSA), applicable in Bulgaria.
Opinion under Art. 37, paragraph 6 of the Accountancy Act
Based on the procedures performed, in our opinion:
• The information included in the annual activity report for the financial year for which the financial
statements have been prepared, is consistent with the financial statements.
• The annual activity report has been prepared in accordance with the requirements of Chapter Seven of
the Accountancy Act and of Art. 100m, paragraph 7 of the Public Offering of Securities Act.
• The information required by Chapter Seven of the Accountancy Act and Art. 100m, paragraph 8 of
the Public Offering of Securities Act is presented in the corporate governance statement covering the
financial year for which the financial statements have been prepared.
• The report on the implementation of the policy on the remuneration, covering the financial year for
which the financial statements have been prepared, has been provided and meets the requirements
defined in the Ordinance referred to in Art. 116c, paragraph 1 of the Public Offering of Securities Act.
6
Opinion under Art. 100m, paragraph 10 in relation to Art. 100m, paragraph 8, p. 3 and 4 of the Public
Offering of Securities Act
Based on the procedures performed and as a result of the acquired knowledge and understanding of the
Company and the environment in which it operates, acquired during our audit, in our opinion, the description
of the main features of the Company’s internal control and risk management systems in relation to the
financial reporting process as part of the annual activity report (as element of the content of the corporate
governance statement) and the information under Art. 10, paragraph 1, letter "c", "d", "f", "h" and "i" of the
Directive 2004/25/EC of the European Parliament and of the EU Council of April 21, 2004 related to
takeover bids do not contain cases of material misrepresentations.
Additional Reporting in Relation to the Audit of the Financial Statements under Art. 100m, paragraph
4, p. 3 of the Public Offering of Securities Act
Reporting in relation to Art. 100m, paragraph 4, p. 3, l. "b" of the Public Offering of Securities Act
Information on related party transactions is disclosed in Note 16 to the accompanying financial statements.
Based on the procedures performed on related party transactions in the context of our audit of the financial
statements as a whole, nothing has come to our attention indicating that the related party transactions are not
disclosed in the accompanying financial statements for the year ended December 31, 2023, in all material
respects, in accordance with the requirements of IAS 24 Related Party Disclosures. We have considered the
results of our audit procedures on related party transactions in forming our opinion on the financial statements
as a whole and not for the purpose of providing a separate opinion on the related party transactions.
Reporting in relation to Art. 100m, paragraph 4, p. 3, l. "c" of the Public Offering of Securities Act
Our responsibilities for the audit of the financial statements described in section Auditor’s Responsibilities
for the Audit of the Financial Statements include evaluating whether the financial statements represent the
underlying transactions and events in a manner that achieves fair presentation. Based on the procedures
performed on the material transactions underlying the financial statements for the year ended December 31,
2023, nothing has come to our attention indicating any instances of material unfair presentation and
disclosure under the applicable IFRSs as adopted by the EU. We have considered the results of our audit
procedures on the material transactions underlying the financial statements in forming our opinion on the
financial statements as a whole and not for the purpose of providing a separate opinion on these material
transactions.
Reporting in Accordance with Art. 10 of Regulation (EU) No 537/2014 in Connection with the
Requirements of Art. 59 of the Independent Financial Audit Act
In accordance with the requirements of the Independent Financial Audit Act in connection with Art. 10 of
Regulation (EU) No 537/2014, we hereby additionally report the information stated below.
• Deloitte Audit OOD was appointed as a statutory auditor of the financial statements of the Company
for the year ended December 31, 2023 by the General Meeting of Shareholders held on June 21, 2023
for a period of one year.
• The audit of the financial statements of the Company for the year ended December 31, 2023 represents
third total consecutive statutory audit engagement for that entity carried out by us.
• We hereby confirm that the audit opinion expressed by us is consistent with the additional report,
provided to the Company’s Audit Committee on March 15, 2024, in compliance with the requirements
of Art. 60 of the Independent Financial Audit Act.
Opinion under Art. 100m, paragraph 10 in relation to Art. 100m, paragraph 8, p. 3 and 4 of the Public
Offering of Securities Act
Based on the procedures performed and as a result of the acquired knowledge and understanding of the
Company and the environment in which it operates, acquired during our audit, in our opinion, the description
of the main features of the Company’s internal control and risk management systems in relation to the
financial reporting process as part of the annual activity report (as element of the content of the corporate
governance statement) and the information under Art. 10, paragraph 1, letter "c", "d", "f", "h" and "i" of the
Directive 2004/25/EC of the European Parliament and of the EU Council of April 21, 2004 related to
takeover bids do not contain cases of material misrepresentations.
Additional Reporting in Relation to the Audit of the Financial Statements under Art. 100m, paragraph
4, p. 3 of the Public Offering of Securities Act
Reporting in relation to Art. 100m, paragraph 4, p. 3, l. "b" of the Public Offering of Securities Act
Information on related party transactions is disclosed in Note 16 to the accompanying financial statements.
Based on the procedures performed on related party transactions in the context of our audit of the financial
statements as a whole, nothing has come to our attention indicating that the related party transactions are not
disclosed in the accompanying financial statements for the year ended December 31, 2023, in all material
respects, in accordance with the requirements of IAS 24 Related Party Disclosures. We have considered the
results of our audit procedures on related party transactions in forming our opinion on the financial statements
as a whole and not for the purpose of providing a separate opinion on the related party transactions.
Reporting in relation to Art. 100m, paragraph 4, p. 3, l. "c" of the Public Offering of Securities Act
Our responsibilities for the audit of the financial statements described in section Auditor’s Responsibilities
for the Audit of the Financial Statements include evaluating whether the financial statements represent the
underlying transactions and events in a manner that achieves fair presentation. Based on the procedures
performed on the material transactions underlying the financial statements for the year ended December 31,
2023, nothing has come to our attention indicating any instances of material unfair presentation and
disclosure under the applicable IFRSs as adopted by the EU. We have considered the results of our audit
procedures on the material transactions underlying the financial statements in forming our opinion on the
financial statements as a whole and not for the purpose of providing a separate opinion on these material
transactions.
Reporting in Accordance with Art. 10 of Regulation (EU) No 537/2014 in Connection with the
Requirements of Art. 59 of the Independent Financial Audit Act
In accordance with the requirements of the Independent Financial Audit Act in connection with Art. 10 of
Regulation (EU) No 537/2014, we hereby additionally report the information stated below.
• Deloitte Audit OOD was appointed as a statutory auditor of the financial statements of the Company
for the year ended December 31, 2023 by the General Meeting of Shareholders held on June 21, 2023
for a period of one year.
• The audit of the financial statements of the Company for the year ended December 31, 2023 represents
third total consecutive statutory audit engagement for that entity carried out by us.
• We hereby confirm that the audit opinion expressed by us is consistent with the additional report,
provided to the Company’s Audit Committee on March 15, 2024, in compliance with the requirements
of Art. 60 of the Independent Financial Audit Act.
7
• We hereby confirm that no prohibited non-audit services referred to in Art. 64 of the Independent
Financial Audit Act were provided.
• We hereby confirm that in conducting the audit we have remained independent of the Company.
• For the period to which our statutory audit refers, we have provided to the Company, in addition to
the statutory audit, the following services which have not been disclosed in the Company’s annual
activity report or financial statements:
o Audit of the group reporting package as of December 31, 2023 of Korado-Bulgaria AD, prepared in
accordance with the accounting policies of Korado A.S. Group, Czech Republic, based on IFRS, in
accordance with ISA
Deloitte Audit OOD
Reg. No 033 in the Register of the registered auditors
under Art. 20 of Independent Financial Audit Act
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager
4, Mihail Tenev Str.
1784 Sofia, Bulgaria
• We hereby confirm that no prohibited non-audit services referred to in Art. 64 of the Independent
Financial Audit Act were provided.
• We hereby confirm that in conducting the audit we have remained independent of the Company.
• For the period to which our statutory audit refers, we have provided to the Company, in addition to
the statutory audit, the following services which have not been disclosed in the Company’s annual
activity report or financial statements:
o Audit of the group reporting package as of December 31, 2023 of Korado-Bulgaria AD, prepared in
accordance with the accounting policies of Korado A.S. Group, Czech Republic, based on IFRS, in
accordance with ISA
Deloitte Audit OOD
Reg. No 033 in the Register of the registered auditors
under Art. 20 of Independent Financial Audit Act
Rositsa Boteva
Registered Auditor, in charge of the audit
Statutory Manager
4, Mihail Tenev Str.
1784 Sofia, Bulgaria
Deloitte Audit OOD
UIC 121145199
4 Mihail Tenev Str., fl. 12
Balkan Business Center
1784 Sofia, Bulgaria
Tel: +359 (2) 802 3300
Fax: +359 (2) 802 3350
www.deloitte.bg
Делойт Одит ООД
ЕИК 121145199
ул. Михаил Тенев 4, ет. 12
Балкан Бизнес Център
1784 София, България
T ел : +359 (2) 802 3300
Факс : +359 (2) 802 3350
Делойт се отнася към едно или повече дружества - членове на Делойт Туш Томацу Лимитид („ДТТЛ“ ), както и към глобалната мрежа от дружества – членове и
свързаните с тях дружества (заедно наричани „организацията на Делойт). ДТТЛ (наричано също “Делойт Глобъл“) и всяко дружество– член и неговите свързани
дружества са юридически самостоятелни и независими лица, които не могат да поемат задължения или да се обвързват взаимно по отношение на трети страни.
ДТТЛ и всяко дружество член на ДТТЛ и свързаните с него дружества са отговорни единствено и само за своите собствени действия и бездействия, но не и за тези
на останалите. ДТТЛ не предоставя услуги на клиенти. Моля, посетете www.deloitte.com/about, за да научите повече.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte
organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot
obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each
other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
To
The shareholders of
Korado-Bulgaria AD
DECLARATION
Under art. 100m, para 4, p. 3
of the Public Offering of Securities Act
The undersigned:
Rositsa Boteva, in my capacity of:
- Statutory Manager of audit firm Deloitte Audit OOD, with UIC 121145199, with a
seat and management address in Sofia 1784, 4, Mihail Tenev Str., and correspondence address in
in Sofia 1784, 4, Mihail Tenev Str., and
- Registered auditor (with reg. № 0500 of the register of CPOSA under art. 20 of the
Independent Financial Audit Act), responsible for the audit engagement performed by the audit firm
Deloitte Audit OOD (with reg. № 033 the register of CPOSA under art. 20 of the Independence
Financial Act),
Declare that:
Deloitte Audit OOD was engaged to perform statutory financial audit of the annual
financial statements of Korado-Bulgaria AD for 2023, prepared in accordance with the International
Financial Reporting Standards, as endorsed by EU, generally accepted name of accounting
framework, as defined in art. 8 of the additional provisions of the Accountancy Act with name
“International accounting standards”. As a result of our audit we issued audit report dated March
18, 2024.
Hereby I declare that as reported in our auditor’s report regarding the annual financial
statements of Korado-Bulgaria AD for 2023, issued on March 18, 2024 that:
1. Art. 100m, para 4, p. 3, l. “a” Audit opinion: In our opinion, the accompanying
financial statements present fairly, in all material respects, the financial position of
the Company as at December 31, 2023, and its financial performance and its cash
flows for the year then ended in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the European Union (EU). (page 1 of the auditor’s
report) ;
UIC 121145199
4 Mihail Tenev Str., fl. 12
Balkan Business Center
1784 Sofia, Bulgaria
Tel: +359 (2) 802 3300
Fax: +359 (2) 802 3350
www.deloitte.bg
Делойт Одит ООД
ЕИК 121145199
ул. Михаил Тенев 4, ет. 12
Балкан Бизнес Център
1784 София, България
T ел : +359 (2) 802 3300
Факс : +359 (2) 802 3350
Делойт се отнася към едно или повече дружества - членове на Делойт Туш Томацу Лимитид („ДТТЛ“ ), както и към глобалната мрежа от дружества – членове и
свързаните с тях дружества (заедно наричани „организацията на Делойт). ДТТЛ (наричано също “Делойт Глобъл“) и всяко дружество– член и неговите свързани
дружества са юридически самостоятелни и независими лица, които не могат да поемат задължения или да се обвързват взаимно по отношение на трети страни.
ДТТЛ и всяко дружество член на ДТТЛ и свързаните с него дружества са отговорни единствено и само за своите собствени действия и бездействия, но не и за тези
на останалите. ДТТЛ не предоставя услуги на клиенти. Моля, посетете www.deloitte.com/about, за да научите повече.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte
organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot
obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each
other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
To
The shareholders of
Korado-Bulgaria AD
DECLARATION
Under art. 100m, para 4, p. 3
of the Public Offering of Securities Act
The undersigned:
Rositsa Boteva, in my capacity of:
- Statutory Manager of audit firm Deloitte Audit OOD, with UIC 121145199, with a
seat and management address in Sofia 1784, 4, Mihail Tenev Str., and correspondence address in
in Sofia 1784, 4, Mihail Tenev Str., and
- Registered auditor (with reg. № 0500 of the register of CPOSA under art. 20 of the
Independent Financial Audit Act), responsible for the audit engagement performed by the audit firm
Deloitte Audit OOD (with reg. № 033 the register of CPOSA under art. 20 of the Independence
Financial Act),
Declare that:
Deloitte Audit OOD was engaged to perform statutory financial audit of the annual
financial statements of Korado-Bulgaria AD for 2023, prepared in accordance with the International
Financial Reporting Standards, as endorsed by EU, generally accepted name of accounting
framework, as defined in art. 8 of the additional provisions of the Accountancy Act with name
“International accounting standards”. As a result of our audit we issued audit report dated March
18, 2024.
Hereby I declare that as reported in our auditor’s report regarding the annual financial
statements of Korado-Bulgaria AD for 2023, issued on March 18, 2024 that:
1. Art. 100m, para 4, p. 3, l. “a” Audit opinion: In our opinion, the accompanying
financial statements present fairly, in all material respects, the financial position of
the Company as at December 31, 2023, and its financial performance and its cash
flows for the year then ended in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the European Union (EU). (page 1 of the auditor’s
report) ;
2.
Art. 100m, para 4, p. 3, l. “b” Information regarding Korado
-Bulgaria AD related
party transactions. Information on related party transactions is disclosed in Note 16
to the accompanying financial statements. Based on the procedures performed on
related party transactions in the context of our audit of the financial statements as a
whole, nothing has come to our attention indicating that the related party transactions
are not disclosed in the accompanying financial statements for the year ended
December 31, 2023, in all material respects, in accordance with the requirements of
IAS 24 Related Party Disclosures. We have considered the results of our audit
procedures on related party transactions in forming our opinion on the financial
statements as a whole and not for the purpose of providing a separate opinion on the
related party transactions. ( page 6 of the auditor’s report ).
3. Art. 100m, para 4, p. 3, l. “c” Information regarding material transactions . Our
responsibilities for the audit of the financial statements described in section Auditor’s
Responsibilities for the Audit of the Financial Statements include evaluating whether
the financial statements represent the underlying transactions and events in a manner
that achieves fair presentation. Based on the procedures performed on the material
transactions underlying the financial statements for the year ended December 31,
2023, nothing has come to our attention indicating any instances of material unfair
presentation and disclosure under the applicable IFRSs as adopted by the EU. We
have considered the results of our audit procedures on the material transactions
underlying the financial statements in forming our opinion on the financial statements
as a whole and not for the purpose of providing a separate opinion on these material
transactions. ( page 6 of the auditor’s report ).
The declarations made in the current declaration should be considered only in the context
of our auditor’s report regarding the performed independent financial audit of the annual
financial statements of Korado-Bulgaria AD for the reporting period ended December 31, 2023,
dated March 18, 2024. This declaration is intended only for the above stated addressee and is
prepared solely and only for the purpose of complying with the requirements of A rt. 100m, para
4, p.3 of the Public Offering of Securities Act (POSA) and should not be accepted as replacement
of our conclusions, included in our auditor’s report, dated March 18, 2024 regarding the matters,
as scoped by art. 100m, para 4, p. 3 of POSA.
March 18, 2024 For audit firm Deloitte Audit OOD:
Sofia
Rositsa Boteva
Statutory Manager
Registered Auditor, in charge of the audit
party transactions. Information on related party transactions is disclosed in Note 16
to the accompanying financial statements. Based on the procedures performed on
related party transactions in the context of our audit of the financial statements as a
whole, nothing has come to our attention indicating that the related party transactions
are not disclosed in the accompanying financial statements for the year ended
December 31, 2023, in all material respects, in accordance with the requirements of
IAS 24 Related Party Disclosures. We have considered the results of our audit
procedures on related party transactions in forming our opinion on the financial
statements as a whole and not for the purpose of providing a separate opinion on the
related party transactions. ( page 6 of the auditor’s report ).
3. Art. 100m, para 4, p. 3, l. “c” Information regarding material transactions . Our
responsibilities for the audit of the financial statements described in section Auditor’s
Responsibilities for the Audit of the Financial Statements include evaluating whether
the financial statements represent the underlying transactions and events in a manner
that achieves fair presentation. Based on the procedures performed on the material
transactions underlying the financial statements for the year ended December 31,
2023, nothing has come to our attention indicating any instances of material unfair
presentation and disclosure under the applicable IFRSs as adopted by the EU. We
have considered the results of our audit procedures on the material transactions
underlying the financial statements in forming our opinion on the financial statements
as a whole and not for the purpose of providing a separate opinion on these material
transactions. ( page 6 of the auditor’s report ).
The declarations made in the current declaration should be considered only in the context
of our auditor’s report regarding the performed independent financial audit of the annual
financial statements of Korado-Bulgaria AD for the reporting period ended December 31, 2023,
dated March 18, 2024. This declaration is intended only for the above stated addressee and is
prepared solely and only for the purpose of complying with the requirements of A rt. 100m, para
4, p.3 of the Public Offering of Securities Act (POSA) and should not be accepted as replacement
of our conclusions, included in our auditor’s report, dated March 18, 2024 regarding the matters,
as scoped by art. 100m, para 4, p. 3 of POSA.
March 18, 2024 For audit firm Deloitte Audit OOD:
Sofia
Rositsa Boteva
Statutory Manager
Registered Auditor, in charge of the audit