ANNUAL REPORT 2020

Železiarne Podbrezová a.s. ANNUAL REPORT 2020 22 As a result of these activities and various cultural events, the interest of the general public in this historical monument continues to grow. Despite the COVID-19 pandemic restrictions, 21 575 visitors visited the castle in 2020, which is comparable to 2019. CORPORATE SOCIAL RESPONSIBILITY In addition to business activities, the Company and its management have supported socially beneficial activities mainly in the Horehronie region. It cooperates with and supports its current employees and also pensioners in social or healthcare need. Since 2000, the Company has used the Železiarne Podbrezová Foundation for systematic support, which distributes funds to individuals, legal entities and interest groups in healthcare, education, culture and sports every year. In 2020, the Company used its foundation to distribute a total of EUR 596 thousand in the region, most of which for healthcare support. The specific supported project was “Reconstruction and Modernisation of Hospital with Polyclinic in Brezno”: we funded the complete project documentation in the amount of EUR 500 thousand via the foundation. The Company also supports a healthy lifestyle of children and young people. We support young footballers in the Football Academy via FK Železiarne Podbrezová. The academy covers 13 different boys’ and girls’ categories: preparatory (U7 to U11), junior (U12 to U15) and youth teams (U16 to U19). A total of 280 children are engaged in youth training with the total expenses for 2020 amounting to EUR 389 thousand. Via ŠK Železiarne Podbrezová a.s., we support 12 talented young athletes in the biathlon club, 19 racers in the cycling club, 17 children and young people in bowling and a downhill skiing club. The total support for these clubs in 2020 amounted to approx. EUR 80 thousand. REPORT ON ASSETS AND FINANCIAL MANAGEMENT ASSETS AND FUNDS The Company’s assets recognised as at 31 December 2020 in accordance with International Financial Reporting Standards (IFRS) amounted to EUR 291 029 thousand, a year-on- year increase of EUR 10 386 thousand. The overall increase was mainly due to an increase in non- current assets by EUR 6 362 thousand as a result of higher investments in machinery, equipment and buildings, exceeding depreciation charges by EUR 5 172 thousand (5%), and an increase in financial investments. Current assets increased by EUR 4 025 thousand, despite the decline of their largest group – inventories by almost EUR 1 400 thousand, to EUR 53 453 thousand. The only item of current assets that grew were trade receivables (by EUR 7 383 thousand). The Company’s cash decreased by EUR 487 thousand. As at 31 December 2020, the Company’s equity decreased by EUR 5 395 thousand to EUR 205 639 thousand due to the payment of dividends and the recognition of a loss for 2020. The increase in assets combined with a decrease in equity resulted in a lower equity-to-assets ratio from 75.2% to 70.7% as at 31 December 2020. Liabilities increased by EUR 15 781 thousand. The highest growth was recorded in short-term interest-bearing loans and borrowings (EUR 15 692 thousand) and trade payables (EUR 1 756 thousand). In total, interest- bearing loans and borrowings amounted to EUR 47 922 thousand, and their share of total funds was 16.5% as at 31 December 2020. As at 31 December 2020, the Company’s trade receivables amounted to EUR 40 439 thousand, an increase of EUR 7 383 thousand over the previous year. Inventories amounted to EUR 53 453 thousand and trade payables amounted to EUR 22 216 thousand as at 31 December 2020. Throughout the period, the Company’s overdue receivables and overdue payables were at no time a significant percentage of total receivables and payables. The equity-to-total-assets ratio decreased to 70.7%. REPORT BY THE BOARD OF DIRECTORS ON BUSINESS ACTIVITIES, ASSETS AND FINANCIAL PERFORMANCE IN 2020 AND INFORMATION ON THE BUSINESS PLAN