ANNUAL REPORT 2021

Annual report 2021 Železiarne Podbrezová a.s. 18 19 15 OTHER NON-CURRENT LIABILITIES 31 December 2021 31 December 2020 Deferred income 3 026 961 2 130 147 Of which: Subsidies 3 016 373 2 110 738 Other 10 588 19 409 Accrued expenses 7 682 - Other non - current liabilities 56 557 47 210 Total 3 091 200 2 177 357 16 PROVISION FOR EMPLOYEE BENEFITS In accordance with Slovak labour legislation and in accordance with the Board of Directors’ programme, the Group pays certain benefits to its employees as described below. The long - term employee benefit scheme is a programme of defined benefits under which employees are entitled to a one - off bonus upon retirement or disability, and depending on the defined terms also to regular service loyalty bonuses for years served with the Company, and jubilee benefits. As at 31 December 2021, the programme was applicable to 2 977 employees of the Company. As at the aforementioned date, the programme was unfunded, i.e. no specific assets were allocated to cover liabilities arising from the scheme. 31 December 2021 31 December 2020 Present value of benefits paid on retirement 6 678 945 6 273 462 Present value of length of service benefits 1 234 731 934 368 Present value of jubilee benefits 190 673 195 834 Total 8 104 349 7 403 664 Key assumptions used in the actuarial valuation: 31 December 2021 Annual future real rate of salary increases 2022: 5%; future years: 2.00% Annual employee turnover 9.7% Retirement age 64 years or less, as per applicable legislation To calculate the provision for employee benefits, the Company applied the current average NBS interest rate provided to non - financial institutions in the Eurozone. 17 DEFERRED TAX LIABILITY The table below provides details on the major items of deferred tax assets and liabilities recognised by the Company, and debits/credits made to the items during the current and prior reporting periods: 1 January 2021 (Debited)/credited to the current-year profit (Debited) credited to equity 31 December 2021 Property, plant and equipment (8 317 870) (629 015) - (8 946 885) Inventories 397 042 (238 275) - 158 767 Receivables 9 263 (3 682) - 5 581 Tax loss - 147 884 - 147 884 Liabilities 261 006 (9 691) - 251 315 Employee benefits 1 554 769 147 144 - 1 701 913 Research and development 395 308 2 094 108 - 2 489 416 Subsidies 29 995 37 860 - 67 855 Total (5 670 487) 1 546 333 - (4 124 154) 1 January 2020 (Debited)/credited to the current-year profit (Debited) credited to equity 31 December 2020 Property, plant and equipment (9 762 664) 1 444 794 - (8 317 870) Inventories 248 454 148 588 - 397 042 Receivables 13 402 (4 139) - 9 263 Liabilities 251 409 9 597 - 261 006 Employee benefits 1 660 220 (105 451) - 1 554 769 Research and development 395 308 - - 395 308 Subsidies 90 894 (60 899) - 29 995 Total (7 102 977) 1 432 490 - (5 670 487) Following the existing accounting principles, the Company offset its deferred tax assets against deferred tax liabilities. The table below provides resulting deferred tax balances (after clearing) to be disclosed on the balance sheet: 31 December 2021 31 December 2020 Deferred tax asset 5 448 997 3 671 014 Deferred tax liability (9 573 151) (9 341 501) Total (4 124 154) (5 670 487) NOTES TO THE SEPARATE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 (IN EUROS)