Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 98/2024 of 12 September 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 7 November 2024 the Company, acting on its own behalf and on behalf of its two subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Chemiczne Police S.A., signed an annex to the letter of intent recently entered into with ORLEN S.A. (the “LoI”), extending the term of the LoI until 31 December 2024. The remaining provisions of the LoI have remained unchanged.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024 , No. 46/2024 of 26 April 2024, No 61/2024 of 29 May 2024, No 68/2024 of 14 June 2024, No 87/2024 of 6 August 2024, No 94/2024 of 30 August 2024  and 102/2024 of 1 October 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 31 October 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement effective as of 31 July 2024 (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 29 November 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 28 November 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the third quarter and the first nine months of 2024.

Discussion of the Q3 2024 results:

In the third quarter of 2024, the Group generated consolidated revenue of PLN 3,085 million and EBITDA of PLN -120 million, with an EBITDA margin of -3.9%, which improved by almost PLN 228 million year on year.

The net loss for the third quarter of 2024 was PLN 226 million, compared to a net loss of PLN 743 million for the third quarter of 2023.

The third quarter of 2024 saw an ongoing economic downturn in Europe and globally, resulting in insufficient demand for fertilizer and chemical products. European producers continued to be adversely affected by product imports into the EU, which had a key impact on the Group’s performance in all core business segments.

The prices of most production raw materials and energy carriers experienced a year-on-year decline in the reporting quarter, particularly significant on the case of coal and electricity.  Natural gas prices went up by 6% year on year (TTF prices), and remained unchanged as the Group’s unit costs.  Consistent recovery measures, including those designed to increase sales and reduce operating expenses, led to an improvement in the financial results for the quarter. Despite the positive effect of lower unit costs on the Group’s results, EBITDA margins delivered by the key segments were negative, although significantly better compared with the third quarter of 2023.

Main factors with a bearing on the Group’s financial performance in the key segments in the third quarter of 2024 compared with the third quarter of 2023:

Agro

In the Agro Segment in the third quarter of 2024, compared with the same period the previous year, fertilizer imports from Russia and Belarus were the primary factor impacting results, leading to a decline in both product prices and sales volumes.

The ongoing global economic downturn, especially the influx of cheaper fertilizers into the EU – primarily from Russia and Belarus – adversely impacted the competitive position of European producers, leading to further price declines. In the case of the Group, average prices for the segment’s products fell by 7% year on year. In addition to the impact of imports, fertilizer market activity was further constrained by the broader economic conditions in the agriculture sector. Farmers expressed a negative outlook on production profitability, citing uncertainties related to weather conditions, geopolitical conflicts, and other factors. Compared with the same quarter of 2023, the Group reported a 9% decline in fertilizer sales, including sales of nitrogen fertilizers (down 6% year on year) and compound fertilizers (down 18% year on year, despite a 11% year-on-year increase in sales of speciality fertilizers).

The Agro Segment posted an EBITDA margin of -4.4% for the third quarter of 2024, having improved by 3.2 pp year on year.

Chemicals

The Chemicals Segment reported a year-on-year increase in total sales volume for the third quarter of 2024, accompanied by a simultaneous drop in prices of products and raw materials.

The segment’s performance was mainly determined by a challenging macroeconomic environment and persistent oversupply of products, including from countries with lower production costs compared with Europe. As a result, the Group reduced its output of technical-grade urea and melamine, among other products (in early July, Grupa Azoty Zakłady Azotowe Puławy S.A. again shut down the Melamine III unit). The segment’s profitability benefited from a year-on-year decline in prices of the vast majority of key production raw materials. Prices dropped significantly year on year for Pulnox and NOXy, while sulfur prices rose markedly. Logistical disruptions in the Red Sea region led to reduced imports of Asian products and increased their costs. However, this was insufficient to significantly improve the situation for European manufacturers.

The Chemicals Segment posted an EBITDA margin of -6.7% for the third quarter of 2024, up by 21.9 pp year on year.

Plastics

In the three months to 30 September 2024, the Plastics Segment recorded a year-on-year increase in both production and sales volumes, with a concurrent drop in the price of the raw material (phenol) and higher prices of the main product (natural polyamide).

The market situation for the entire product chain was heavily influenced by demand and supply conditions in end-application markets, which were impacted by challenging macroeconomic conditions. Imports of products (fibres, films) from regions with higher cost competitiveness continued to reach the European market, despite logistical challenges arising from the conflict in the Middle East. Due to the persistently challenging demand-supply conditions in the third quarter of 2024, caprolactam production at Grupa Azoty Puławy was not resumed, aside from the temporary launch of production units to process existing stocks of raw materials and semi-finished products.

The Plastics Segment posted an EBITDA margin of -16.1% for the third quarter of 2024, having improved by 17.9 pp year on year. The segment’s results also encompass the production and sales of Grupa Azoty Polyolefins S.A., which is currently at the stage of plant commissioning and test runs. In the third quarter of 2024, the company’s total sales volume was 56,000 tonnes, of which 99% were sales of homopolymer.

Results for the first nine months of 2024

In the first nine months of 2024, the Group generated consolidated revenue of PLN 9,828 million and EBITDA of PLN -299 million, with an EBITDA margin of -3.0%, which improved by PLN 1,058 million year on year.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the three months ended 30 September 2024, to be issued on 6 November 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 91/2024 of 29 August 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 18 October 2024 the Management Board of Grupa Azoty Zakłady Azotowe Puławy S.A., the Company’s subsidiary (the “Subsidiary”), following a round of negotiations, concluded an agreement (the “Agreement”) with the Subsidiary’s Trade Union Organisations regarding the suspension of certain cost-intensive provisions of the Collective Bargaining Agreement and executed a supplement to the Collective Bargaining Agreement.

As per the arrangements agreed at the Subsidiary, the provisions of the Collective Bargaining Agreement (the “Collective Bargaining Agreement”) concerning, among other things, the grant of the annual employee bonus, special awards, performance bonuses and retirement benefits in excess of the Labour Code entitlement, unless an employee retires within periods specified in the Agreement, will be suspended from 1 December 2024 to 31 December 2026. In the period from 1 January 2025 to 31 December 2026, the amounts of jubilee awards and contributions to the Company Social Benefits Fund will be reduced. In addition, while the aforementioned provisions of the Collective Bargaining Agreement remain suspended, retirement benefits and jubilee awards will be paid in instalments.

The Subsidiary has declared that, following the suspension period and upon meeting certain financial and liquidity conditions specified in the Agreement, the amounts that would have been paid to employees if the Collective Bargaining Agreement had not been suspended will be paid retroactively to those individuals who remain the Subsidiary’s employees after the suspension period. In the case of jubilee awards, the retroactive payment will be made regardless of the above conditions.

The agreed suspension periods may be shortened by mutual consent of the parties. However, this can only occur after 31 December 2025 following an analysis of the Subsidiary’s current economic, financial and payment situation, and subject to compliance with the bank covenants.

The conclusion of the Agreement marks the end of the process triggered by the Subsidiary’s notice of intent to terminate the Collective Bargaining Agreement, as the Subsidiary has declared that it revokes the notice.

The conclusion of the Agreement was announced by the Subsidiary in Current Report No. 73/2024 of 18 October 2024.

As a result of the Agreement, the temporary suspension of selected provisions of the Collective Bargaining Agreement has been implemented at all the key companies of the Grupa Azoty Group.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information                                                                                                                                      

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 16 October 2024 the District Court for Kraków-Śródmieście in Kraków, 12th Commercial Division of the National Court Register, registered amendments to the Company’s Articles of Association.

The registered amendments were adopted by Resolution No. 7 of the Company’s Extraordinary General Meeting held on 26 September 2024.

On 9 October 2024, the Company’s Supervisory Board resolved to restate the Articles of Association of the Company by incorporating the amendments adopted by Resolution No. 7 of the Extraordinary General Meeting of 26 September 2024.

The restated Articles of Association are attached as an appendix hereto.

The amendments to the Articles of Association are detailed in a separate appendix hereto.

Legal basis: Par. 5.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023, Current Report No. 10/2024 of 2 February 2024, Current Report No. 23/2024 of 29 February 2024, Current Report No. 33/2024 of 27 March 2024, Current Report No. 44/2024 of 26 April 2024, Current Report No. 60/2024 of 29 May 2024 and Current Report No. 86/2024 of 31 July 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 11 October 2024 the Company, acting on its own behalf and on behalf of certain Grupa Azoty Group companies (the “Grupa Azoty Group”), as listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex (the “Annex”) to the standstill agreement signed on 2 February 2024 (as subsequently amended) with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Poland Branch, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A., Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures the continued availability of credit facility limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in the event of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex until 29 November 2024.

This will support the ongoing restructuring efforts and aid in finalising the development of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities.

The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024 , No. 46/2024 of 26 April 2024, No 61/2024 of 29 May 2024, No 68/2024 of 14 June 2024, No 87/2024 of 6 August 2024 and No 94/2024 of 30 August 2024  the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 1 October 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement effective as of 31 July 2024 (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 31 October 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 30 October 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

GENERAL MEETING, SHAREHOLDER RELATIONS

4.8. Draft resolutions of the general meeting on matters put on the agenda of the general meeting should be tabled by shareholders no later than three days before the general meeting.

The principle has been breached incidentally.

Company’s comment on the breach:

The Management Board of Grupa Azoty S.A. (the “Company”) announces that during the Extraordinary General Meeting held on 26 September 2024 a draft resolution was tabled by an individual shareholder of the Company regarding agenda item 7 – Consideration of the request to amend the Remuneration Policy for Members of the Management Board and Supervisory Board of Grupa Azoty S.A.

In the notice of the General Meeting, the Management Board requested, and will continue to request in the future, that draft resolutions be submitted by eligible shareholders promptly, and in any case no later than three days prior to the date of the General Meeting.

Indication whether the principle has been breached incidentally in the past two years:

Principle 4.8 has been incidentally breached once in the past two years.

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Extraordinary General Meeting held on 26 September 2024, specifying the number of votes conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at that Extraordinary General Meeting and in the total voting rights.

Legal basis: Art. 70.3 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies (consolidated text: Dz.U. of 2024, item 620).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Extraordinary General Meeting (“EGM”) on 26 September 2024, together with the results of voting.

The documents voted on by the Extraordinary General Meeting are available from the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia and attached to Current Report No. 93/2024 and No. 95/2024 of 30 August 2024 and Current Report No. 99/2024 of 23 September 2024.

The Company’s Management Board also publishes, attached to this report, draft resolutions submitted by a shareholder during the Company’s Extraordinary General Meeting which were put to the vote at but were not carried.

Objections to Resolution No. 7 was raised by shareholders during the Annual General Meeting for the record in the minutes.

Legal basis: Section 19.1.4, Section 19.1.6, Section 19.1.8, and Section 19.1.9 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 23 September 2024 it received a notification from the Ministry of State Assets – acting on behalf of the State Treasury, which is a shareholder of the Company – that a draft resolution has been submitted regarding item 7 of the agenda of the Company’s Extraordinary General Meeting convened for 26 September 2024. The draft resolution sent by the Ministry of State Assets, along with the grounds, is provided in the appendix to this Current Report.

The Company will post the draft resolution in the General Meeting section of its website.

Legal basis: Section 19.1.4 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 12 September 2024 the Company, acting on its own behalf and on behalf of its two subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Chemiczne Police S.A., and ORLEN S.A. (jointly, the “Parties”) signed a letter of intent (the “Letter”) in connection with the Parties’ intention to undertake analyses of strategic options with a view to making decisions regarding the conclusion of potential transactions between the Parties in the following areas: polymers (with particular emphasis on Grupa Azoty Polyolefins S.A.), activities related to the production and sale of caprolactam and polyamide 6, as well as components of the port infrastructure of Grupa Azoty FOSFORY Sp. z o.o. of Gdańsk (the “Areas under Analysis”).

During the term of the Letter, the Parties will aim to select specific areas among the Areas under Analysis and strategic options within those selected areas in order to advance further work. Additionally, the Parties will agree in a separate agreement on various aspects, including dedicated areas from the Areas under Analysis and the strategic options related to them, which will be ultimately selected for negotiations and detailed due diligence.

The conclusion of the Letter of Intent is solely an expression of the Parties’ willingness to undertake potential future cooperation in good faith. It outlines the terms and conditions for discussions and activities concerning potential collaboration but does not establish any binding obligations between the Parties, other than those related to acting loyally in good faith to the extent agreed by the Parties and adhering to confidentiality obligations in accordance with the information protection clause and applicable laws.

The signed document is valid for a period of two months from the date of its execution, with the option for renewal for additional periods.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information                                                                                                                                        

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 9 September 2024 the Company, acting on its own behalf and on behalf of selected other Grupa Azoty Group companies (the “Grupa Azoty Group”) specified in the appendix to Current Report No. 10/2024 of 2 February 2024, which are parties to the financing agreements, entered into waiver letters (the “Waiver Letters”) with 13 institutions providing financing to the Grupa Azoty Group: Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bankiem Polska S.A., Caixabank S.A. Poland Branch, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o., Banco Santander S.A., Frankfurt Branch, the European Bank for Reconstruction and Development, and the European Investment Bank, under which these institutions agreed to waive selected terms of the Grupa Azoty Group’s financing agreements, including the covenant concerning the net debt to EBITDA ratio calculated as at 30 June 2024.

The terms of the Waiver Letters do not differ from standard terms used in such agreements.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 21/2023 of 24 May 2023, Current Report No. 52/2023 of 13 November 2023, Current Report No. 11/2024 of 2 February 2024, and Current Report No. 12/2024 of 6 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 6 September 2024 the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”) received from Hyundai Engineering Co., Ltd, the General Contractor for the Polimery Police project, two change proposals (the “Change Proposals”) concerning the turnkey engineering, procurement and construction contract for the Polimery Police project of 11 May 2019 (the “EPC Contract”).

The first change proposal submitted by the General Contractor (the “First Change Proposal”) seeks an extension of the completion deadline for the Polimery Police project by an additional 43 days (in addition to the 261 days specified in the General Contractor’s notices of initiation of a change procedure under the EPC Contract to extend the project completion date, announced in Current Report No. 52/2023 of 13 November 2023 and Current Report No. 11/2024 of 2 February 2024) and an increase in the General Contractor’s remuneration by EUR 9,609,408.94. The General Contractor cites events affecting specific parts of the project, which resulted from insufficient coordination of work, as the reasons for requesting an extension of the completion deadline and the increase in remuneration under the First Change Proposal.

The second change proposal submitted by the General Contractor (the “Second Change Proposal”) concerns an increase of EUR 116,220,264 in the General Contractor’s remuneration. The General Contractor stated that the basis for requesting the remuneration increase under the Second Change Proposal is the additional costs that the General Contractor had incurred as a result of activities undertaken by the Subsidiary’s personnel during the commissioning phase.

Both Change Proposals will be thoroughly reviewed and verified in terms of their appropriateness under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the General Contractor, as well as in the light of facts.

The Subsidiary is currently negotiating with the General Contractor regarding the final settlement of the Polimery Police project, including reaching an agreement on mutual claims. As part of the negotiations, the Subsidiary informed the General Contractor of its position and assessment regarding the previously submitted change proposals (published in Current Report No. 21/2023 of 24 May 2023, Current Report No. 52/2023 of 13 November 2023, Current Report No. 11/2024 of 2 February 2024, and Current Report No. 12/2024 of 6 February 2024), stating that, based on the documents and information provided, the Subsidiary, for the most part, does not find grounds to grant the General Contractor’s claims specified above.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 93/2024 of 30 August 2024, the Management Board of Grupa Azoty S.A. (the “Company”), in connection with the Extraordinary General Meeting (“EGM”) convened for 26 September 2024, provides, as an appendix hereto, the resolution of the Company’s Supervisory Board of 28 August 2024 presenting its opinion on the draft resolutions to be voted on at the EGM. The resolution supplements the materials submitted by the Company for consideration by the EGM thus far.

The document referred to above will be posted on the Company’s website in the General Meetings section.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024, No. 46/2024 of 26 April 2024, No. 61/2024 of 29 May 2024, No. 68/2024 of 14 June 2024 and No. 87/2024 of 6 August 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces the extension of the term of the standstill agreement executed by Grupa Azoty Polyolefins S.A. (the “Subsidiary”) with the following financial institutions: Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Branch in Poland, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”), concerning the financing of the Polimery Police project (the “Project”) and related to the existing Project financing agreement (the “Credit Facilities Agreement”), reported on by the Company in Current Report No. 23/2020 of 31 May 2020. The term of the Standstill Agreement was extended from 30 August 2024 to 30 September 2024.

As a result of the extension, the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) will contribute the balance of the support loan to the Subsidiary, in the amount of up to EUR 105 million (the upper limit), by 29 August 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Extraordinary General Meeting of the Company convened for 26 September 2024, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes the Extraordinary General Meeting of the Company to be held on 26 September 2024, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Section 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 August 2024 the Management Board of the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) submitted to the Trade Union Organisations (the “Trade Unions”) which are parties to the Collective Bargaining Agreement for Employees Employed by the Subsidiary (the “Collective Bargaining Agreement”) a notice to the effect that the Subsidiary intends to terminate the Collective Bargaining Agreement, in accordance with generally applicable laws and the provisions of the Collective Bargaining Agreement.

The decision to submit the above notice was preceded by unsuccessful negotiations regarding a proposal to suspend certain cost-intensive provisions of the Collective Bargaining Agreement.

The Collective Bargaining Agreement will be terminated at the end of a three-month notice period, which the Subsidiary will be entitled to initiate after completing with the Trade Unions the negotiation process outlined in the Collective Bargaining Agreement. This process is triggered if the Trade Unions submit objections to the notice of intent to terminate within seven days of receiving it.

The Subsidiary announced its intention to submit a termination notice for the Collective Bargaining Agreement in Current Report No. 61/2024, dated 29 August 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (‘the Company’) hereby corrects the entry communicated in current report No. 90/2024 published on 26 August 2024 with regard to the effective date of suspension of additional retirement severance payments.

It is:

Under the Agreement the key provisions of the Collective Bargaining Agreement, including those on granting employees quarterly incentive bonuses, annual bonuses, and retirement severance payments, were suspended for a period of 27 months, from 1 October 2024 to 31 December 2026. Starting from 1 January 2025, for a period of 24 months until 31 December 2026, contributions to the Company Social Benefits Fund will be reduced to the statutory rate.

It should be:

Under the Agreement the key provisions of the Collective Bargaining Agreement, including those on granting employees quarterly incentive bonuses, annual bonuses, , were suspended for a period of 27 months, from 1 October 2024 to 31 December 2026. Starting from 1 January 2025, for a period of 24 months until 31 December 2026, retirement severance payments and contributions to the Company Social Benefits Fund will be reduced to the statutory rate.

The remaining contents of current report No. 90/2024 remain unchanged.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 26 August 2024 the Company’s Management Board entered into an agreement with the Company’s Trade Union Organisations (the “Agreement”) regarding the suspension of selected cost-intensive provisions of the Collective Bargaining Agreement (the “Collective Bargaining Agreement”).

Under the Agreement the key provisions of the Collective Bargaining Agreement, including those on granting employees quarterly incentive bonuses, annual bonuses, and additional illness and retirement severance payments, were suspended for a period of 27 months, from 1 October 2024 to 31 December 2026.Starting from 1 January 2025, for a period of 24 months until 31 December 2026, contributions to the Company Social Benefits Fund will be reduced to the statutory rate.

Similar agreements to temporarily suspend the application of certain provisions of collective bargaining agreements have been concluded by two key companies of the Grupa Azoty Group: Grupa Azoty Zakłady Chemiczne Police S.A. (as announced by the subsidiary in Current Report No. 62/2024 of 26 August 2024) and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A.

The concluded agreements include a declaration that, following the suspension period and upon meeting certain financial and liquidity conditions specified in the agreements, the amounts that would have been paid to employees if the Collective Bargaining Agreement had not been suspended will be paid retroactively.

The suspension periods or changes of specific provisions of the Collective Bargaining Agreement as set out in the Agreements may be shortened by mutual consent of the parties. However, this cannot occur before 31 December 2025 after an analysis of the companies’ current economic, financial and payment situation, and subject to compliance with bank covenants.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the second quarter and the first half of 2024.

Discussion of the results for the second quarter of 2024

The challenging market conditions in the European fertilizer and chemical industry are evident in the financial results for the second quarter and first half of 2024. The results are also adversely impacted by the absence of effective corrective and adaptation measures in 2023 and previous years.

In the second quarter of 2024, the Grupa Azoty Group generated consolidated revenue of PLN 3,344 million and EBITDA of PLN -128 million, with an EBITDA margin of -3.8%.

The second quarter of 2024 did not bring a reversal of the persistently unfavourable macroeconomic trends in Europe and globally. Globally, however, there are noticeable signs that could indicate a slow economic recovery and the potential to emerge from the economic crisis. Demand for Grupa Azoty Group’s products, despite some periodic increases, remained unsatisfactory, particularly in light of the product price declines in the Agro Segment.

In the reporting quarter, the prices of almost all raw materials used in production also fell year on year, and in the case of natural gas the decline reached 10% (based on TTF prices). There was also a significant drop of up to 50% in unit costs of energy carriers, including electricity and coal. Despite the positive effect of lower unit costs on Grupa Azoty Group’s results, EBITDA margins delivered by the key segments were negative.

Main factors with bearing on the Grupa Azoty Group’s financial performance within the key segments in the second quarter of 2024 compared with the second quarter of 2023:

Agro

In the Agro Segment, key performance drivers in the three months ended 30 June 2024 compared with the second quarter of 2023 included an uptick in production volumes and sales, with a concurrent decline in the prices for products and most raw materials.

In the second quarter of 2024, a slowdown in the downward trend of agricultural produce prices and a slight economic improvement in the agriculture sector were observed. However, the increase in fertilizer market activity was constrained by the broader economic environment. A seasonal increase in interest in fertilizers at sales outlets resulted in a 36% year-on-year increase in fertilizer sales, including nitrogen fertilizers (up 35% year on year) and compound fertilizers (up 40% year on year). Simultaneously, the ongoing global economic crisis and the availability of competitively priced imports, particularly urea, led to further reductions in fertilizer prices in the European market. In the case of the Grupa Azoty Group, average prices for the segment’s products fell by 23% year on year.

The Agro Segment saw a year-on-year drop in prices of natural gas and most other raw materials used in production. However, this reduction was insufficient to achieve a positive EBITDA margin for the segment, partly due to the steeper decline in product prices.

The Agro Segment posted an EBITDA margin of -5.4% for the second quarter of 2024, having improved by almost PLN 418 million year on year.

Chemicals

The Chemicals Segment reported a year-on-year increase in total sales volume for the second quarter of 2024, accompanied by a simultaneous reduction in prices for most products and raw materials.

The segment’s results were most significantly impacted by the weak global economy, high customer stock levels, and the influx of cheaper imports into the European market. These factors led to a decline in prices for most of Grupa Azoty Group’s products within the Segment and production cuts (Grupa Azoty Zakłady Azotowe Puławy S.A., the Company’s subsidiary, operated only one of its three melamine units during the second quarter of 2024). On the other hand, there were also some favourable developments, including a year-on-year decrease in the prices of all essential production raw materials as well as logistical challenges related to imports through the Red Sea, which led to longer delivery times and increased transportation costs to the European market, thus decelerating imports from Asia. Sulfur and plasticizer prices also increased.

The Chemicals Segment posted an EBITDA margin of -9.4% in the second quarter of 2024, having improved by PLN 189 million year on year.

Plastics

The Plastics Segment recorded a year-on-year increase in both production and sales volumes in the three months to 30 June 2024, with a concurrent increase in the price of the raw material (phenol) and the main product (natural polyamide).

The segment’s performance in terms of volume was primarily hampered by the ongoing economic crisis. The PA6 product chain market is closely tied to the broader economic conditions, which continued to be very weak in Europe. Logistical constraints caused by attacks in the Red Sea and subsequent route changes led to greater demand for products from Europe. However, the real demand from application sectors remained low compared to historical levels, with variations observed depending on the specific end use.

Due to the continued demand-supply challenges in the second quarter of 2024, production of caprolactam at the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. was not resumed in the period.

The Plastics Segment’s EBITDA margin generated in the second quarter of 2024 was -6.6% and improved by PLN 93 million in relation to the same quarter last year (the Segment’s results also include the production and sales of the Company’s subsidiary Grupa Azoty Polyolefins S.A., which is currently undergoing plant start-up and commissioning tests).

Results achieved in the first half of 2024

In the first half of 2024, the Group generated consolidated revenue of PLN 6,743 million and EBITDA of PLN -179 million, with an EBITDA margin of -2.7%, which improved by almost PLN 830 million year on year.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the six months ended 30 June 2024, scheduled for issue on 11 September 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 7/2024 of 26 January 2024 and No 50/2024 of 16 May 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the release date for the consolidated report for the first half of 2024 has been changed from 28 August 2024 to 11 September 2024.

The release date for the interim report for the third quarter of 2024 remains unchanged, with the updated release dates for interim reports in 2024 provided below:

1. Quarterly report:

Q3 2024 complete consolidated report – 6 November 2024

2. Half-year report:

H1 2024 complete consolidated report – 11 September 2024

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024 , No. 46/2024 of 26 April 2024, No 61/2024 of 29 May 2024 and No 68/2024 of 14 June 2024,  the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 6 August 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement effective as of 31 July 2024 (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 30 August 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 30 August 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023, Current Report No. 10/2024 of 2 February 2024, Current Report No. 23/2024 of 29 February 2024, Current Report No. 33/2024 of 27 March 2024, Current Report No. 44/2024 of 26 April 2024 and Current Report No. 60/2024 of 29 May 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 31 July 2024 the Company, acting on its own behalf and on behalf of certain Grupa Azoty Group companies (the “Grupa Azoty Group”), as listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex, effective as of 30 July 2024  (the “Annex”), to the standstill agreement signed on 2 February 2024 (as subsequently amended) with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Oddział w Polsce, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A. Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures the continued availability of credit facility limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in the event of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex until 11 October 2024.

This will facilitate the completion of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities.

The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 11/2024 of 2 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 31 July 2024 the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”), in the performance of the turnkey engineering, procurement and construction contract for the Polimery Police Project of 11 May 2019 (the “EPC Contract”), executed bilaterial Provisional Acceptance certificates for the Polypropylene Unit sub-project (the “PP Unit”) and the Handling and Storage Terminal sub-project (the “H&ST”) with Hyundai Engineering Co., Ltd, the General Contractor for the Polimery Police Project.

The Provisional Acceptance procedure has been implemented in view of the fact that the parties to the EPC Contract are seeking to expedite all activities required for the General Contractor to deliver the Polimery Police Project for commercial operation.

The procedure gives the Subsidiary full management control of the polypropylene production portfolio, aligned with the prevailing market conditions. The PP Unit’s production capacities amount to 437 thousand tonnes of polypropylene per year. Its key process parameters have been achieved and confirmed through test runs.

Formal handover of the Polimery Police Project is conditional on the execution of an annex to the EPC Contract whereby the parties agree on final approval of the Full-Load Run, settlement terms for the Polimery Police Project, and their respective rights and obligations in connection with completion of the Project’s construction phase.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 70.1 of the Public Offering Act – acquisition or disposal of major holdings of shares

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 July 2024 it received a notification from an attorney-in-fact acting on behalf of Radosław Leszek Kwaśnicki (the “Notifying Party”) in the performance of the obligation set forth in Art. 69.1.2 in conjunction with Art. 69a.1 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated 29 July 2005 (the “Act”) to the effect that the Notifying Party had lost control over shares in the company under the name of: Grupa Azoty Spółka Akcyjna of Tarnów (National Court Register (KRS) number: 0000075450), LEI code: 259400Z9C99U5B36R274, held by the following entities (collectively: the “Companies under Administration”):

a) the company under the name of: Rainbee Holdings Limited of Nicosia (registered address: Kastoros 2, Nicosia, 1087, Cyprus) (“Rainbee Holdings”);
b) the company under the name of: Norica Holding Sàrl (registered address: 121 Avenue de la Faïencerie L-1511, Luxembourg)(“Norica Holding”);
c) the company under the name of: Opansa Enterprises Limited (registered address: Kastoros 2, Nicosia, 1087, Cyprus) (“Opansa Enterprises”),

i.e. a total of 19,657,350 shares in the Company, conferring 19,657,350 voting rights at the Company’s General Meeting, which represent 19.82% of total voting rights in the Company.

According to the notification:

The Notifying Party’s loss of control over the shares resulted from his ceasing to carry out temporary administration of the Companies under Administration in connection with the following court judgments becoming final:

1) judgment by the Provincial Administrative Court of Warsaw dated 10 January 2024 issued in connection with an appeal filed by Rainbee Holdings (case No. I SA/Wa 1777/23), reversing the decision of 11 July 2023 that had placed the appellant under administration, final as of 3 April 2024;
2) judgment by the Provincial Administrative Court of Warsaw dated 10 January 2024 issued in connection with an appeal filed by Norica Holding (case No. I SA/Wa 1775/23), reversing the decision of 11 July 2023 that had placed the appellant under administration, final as of 6 April 2024;
3) judgment by the Provincial Administrative Court of Warsaw dated 10 January 2024 issued in connection with an appeal filed by Opansa Enterprises (case No. I SA/Wa 1776/23), reversing the decision of 11 July 2023 that had placed the appellant under administration, final as of 13 April 2024.

On 29 July 2024, the Notifying Party was notified over the telephone by the Provincial Administrative Court of Warsaw that the aforementioned decisions had become final.

Before the judgments became final, the Notifying Party had had control over a total of 19,657,350 ordinary bearer shares in the Company, representing approximately 19.82% of the Company’s share capital, conferring 19,657,350 voting rights at the Company's General Meeting, representing approximately 19.82% of total voting rights in the Company, i.e.:

1) through Rainbee Holdings, he had had control over 9,820,352 shares in the Company, representing 9.90% of the Company’s share capital and 9,820,352 voting rights at the Company’s General Meeting, accounting for 9.90% of total voting rights in the Company;
2) through Norica Holding, he had had control over 406,998 shares in the Company, representing 0.41% of the Company’s share capital and 406,998 voting rights at the Company’s General Meeting, accounting for 0.41% of total voting rights in the Company;
3) through Opansa Enterprises, he had had control over 9,430,000 shares in the Company, representing 9.51% of the Company’s share capital and 9,430,000 voting rights at the Company’s General Meeting, accounting for 9.51% of total voting rights in the Company.

Following the cessation of temporary administration at the Companies under Administration, the Notifying Party has no control over any Company shares held by the Companies under Administration.

Furthermore, a statement was made on behalf of the Notifying Party to the effect that:

1) there are no subsidiaries of the Notifying Party within the meaning of Art. 4.5 of the Act holding any Company shares;
2) there are no persons referred to in Art. 87.1.3(c) of the Act with respect to the Notifying Party; and
3) the Notifying Party is not entitled to exercise any voting rights attached to Company shares as referred to in Art. 69.4.8 of the Act.

Legal basis: Art. 70.1 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated 29 July 2005 (consolidated text: Dz.U. of 2024, item 620, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Extraordinary General Meeting held on 18 July 2024, specifying the number of votes conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at that Extraordinary General Meeting and in the total voting rights.

Legal basis: Art. 70.3 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies (consolidated text: Dz.U. of 2024, item 620).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Extraordinary General Meeting (“EGM”) on 18 July 2024, together with the results of voting.

The documents voted on by the Extraordinary General Meeting are available from the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia and attached to Current Report No. 73/2024 of 21 June 2024 and Current Report No. 81/2024 of 17 July 2024.

In connection with the use of a computer system for voting and counting the votes, the Extraordinary General Meeting decided not to appoint a Ballot Counting Committee.

Furthermore, the Extraordinary General Meeting decided not to consider item 5 of the agenda ‘Resolution to abolish the secrecy of voting on the election of committees to be appointed by the Extraordinary General Meeting’.

The Company’s Management Board also publishes, attached to this report, draft resolutions which were put to the vote at the Company’s Extraordinary General Meeting but were not carried.

Legal basis: Section 19.1.4, Section 19.1.6, Section 19.1.7, Section 19.1.8, and Section 19.1.9 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 73/2024 of 21 June 2024, the Management Board of Grupa Azoty S.A. (the “Company”), in connection with the Extraordinary General Meeting (“EGM”) convened for 18 July 2024, provides, as an appendix hereto, the resolution of the Company’s Supervisory Board of 17 July 2024 presenting its opinion on the draft resolutions to be voted on at the EGM. The resolution supplements the materials submitted by the Company for consideration by the EGM thus far.

The document referred to above will be posted on the Company’s website in the General Meetings section.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 70.1 of the Public Offering Act – acquisition or disposal of major holdings of shares

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 16 July 2024 it received from Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. (“Pension Fund Management Company”), ul. Topiel 12, 00-342 Warsaw, a notification under Art. 69 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated 29 July 2005. According to the notification from the Pension Fund Management Company, following the disposal of Company shares with LEI code 259400Z9C99U5B36R274 in a transaction executed on the Warsaw Stock Exchange on 9 July 2024, Nationale-Nederlanden Otwarty Fundusz Emerytalny (“Open-End Pension Fund”) reduced its holding of Company shares below 5% of the total voting rights at the Company’s General Meeting. The number of Company shares and votes at the Company’s General Meeting held by the Open-End Pension Fund before the settlement of the transaction was 5,790,189 shares/votes, representing 5.837% of the total voting rights at the Company’s General Meeting. Following the settlement, the number reached 4,765,122 shares/votes, representing 4.804% of the total voting rights at the Company’s General Meeting.

Legal basis: Art. 70.1 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated 29 July 2005 (consolidated text: Dz.U. of 2024, item 620, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Acting pursuant to Article 428.5 of the Commercial Companies Code, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached to this Current Report, its answers to the questions asked by shareholders under Article 428.1 of the Commercial Companies Code during the Annual General Meeting of June 27th 2024.

Legal basis: Par. 19.1.12 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 54/2024 of Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”), dated 4 July 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that it has been notified by the Subsidiary of the stoppage, on 4 July 2024, of the Melamine III unit (Agro Segment) due to economic reasons.

The other two melamine units also remain shut down, following stoppage decisions announced by the Subsidiary in Current Reports No. 21/2022 of 8 July 2022 and 24/2022 of 22 August 2022 with respect to the Melamine I unit, and in Current Report No. 45/2023 of 9 November 2023 with respect to the Melamine II unit.

Production will be resumed as soon as an acceptable market price can be obtained relative to production costs.

Potential demand of strategic customers will be met using accumulated stocks. The intermediate product – urea alloy - will be utilised to make other, more profitable products.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Annual General Meeting held on 27 June 2024, specifying the number of voting rights conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at the Annual General Meeting and in total voting rights.

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated 29 July 2005 (consolidated text: Dz.U. of 2024, item 620).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Annual General Meeting (“AGM”) on 27 June 2024, together with the results of voting.

The documents voted on by the Annual General Meeting are available from the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia. They have also been published with the Company’s separate and consolidated annual reports for 2023, and attached to Current Report No. 58/2024 of 24 May 2024, Current Report No. 59/2024 of 28 May 2024, Current Report No. 69/2024 of 18 June 2024, and Current Report No. 74/2024 of 25 June 2024.

In connection with the use of a computer system for voting and counting the votes, the Annual General Meeting decided not to appoint a Ballot Counting Committee.

Furthermore, the Annual General Meeting decided not to consider item 5 of the agenda ‘Resolution to abolish the secrecy of voting on the election of committees to be appointed by the Annual General Meeting’.

The Company’s Management Board also publishes, attached to this report, draft resolutions which were put to the vote at the Company’s Annual General Meeting but were not carried.

Furthermore, the Management Board publishes, attached hereto, draft resolutions submitted by eligible individual shareholders during the Annual General Meeting.

Objections to Resolutions No. 3, 6, 11, 13, 15, 19, 21, 23 and 25 were raised by shareholders during the Annual General Meeting for the record in the minutes.

Legal basis: Section 19.1.4, Section 19.1.6, Section 19.1.7, Section 19.1.8, and Section 19.1.9 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 27 June 2024, pursuant to resolutions of the Company’s Annual General Meeting, the following persons were appointed as members to the Company’s Supervisory Board of the 12th joint term of office:

Artur Kucharski – Chair of the Supervisory Board 
Robert Bednarski
Piotr Marciniak
Artur Rzempała
Mirosław Sobczyk
Robert Kapka – elected by the Company’s employees
Tomasz Klikowicz – elected by the Company’s employees
Roman Romaniszyn – elected by the Company’s employees.

The resolutions to appoint members of the Company’s Supervisory Board of the 12th term of office took effect from their date.

The Company’s Management Board further states that: The newly appointed Chair and Members of the Supervisory Board have submitted representations to the effect that the activities they are engaged in outside the Company are not competing with the Company’s business and that they are not shareholders or partners in any company or partnership or members of the governing bodies of any other legal persons which would compete with the Company’s business. 

The representations also include statements to the effect that the new Chair and Members of the Supervisory Board of the 12th term of office are not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

A brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Members of the Company’s Supervisory Board of the 12th term is attached to this current report.

Section 5.5. of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 25 June 2024 it received a notification from the Ministry of State Assets – acting on behalf of the State Treasury, which is a shareholder of the Company – that

1. Artur Kucharski – also for the position of Chair of the Supervisory Board
2. Mirosław Sobczyk
3. Piotr Marciniak
4. Artur Rzempała
5. Robert Bednarski

as candidates for members of the Company’s Supervisory Board of the 12th term. The notification was sent in connection with items 18 and 19 of the agenda of the Annual General Meeting of the Company convened for 27 June 2024.

All candidates have received a positive opinion from the Council for State-Owned Companies and State Legal Persons, referred to in Art. 19.1 of the Act on State Property Management of 16 December 2016, and meets the requirements set out in the laws of general application.

A brief description of the educational background, qualifications, previously held positions and employment record of each of the above candidates to the Company’s Supervisory Board is attached to this current report.

The Company’s Management Board also announces that the candidates have made a representation to the effect that they are not engaged in any activities competing with the Company’s business, nor are they partners in any competing partnership under civil law or any other type of partnership, shareholders in any competing company or members of governing bodies of any other competing legal entities.

The representations received by the Company include a statement to the effect that the candidates to the Supervisory Board are not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Extraordinary General Meeting of the Company convened for 18 July 2024, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes the Extraordinary General Meeting of the Company to be held on 18 July 2024, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Extraordinary General Meeting attached as an appendix hereto.

Legal basis: Section 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 10/2024 of 2 February 2024, Current Report No. 23/2024 of 29 February 2024, Current Report No. 33/2024 of 27 March 2024, Current Report No. 44/2024 of 26 April 2024, and Current Report No. 60/2024 of 29 May 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 21 June 2024 it passed a resolution in the performance of the agreement concluded with its financing parties (the “Agreement”), as announced in Current Report No. 10/2024, subject to relevant approvals by the Company’s Supervisory Board and Extraordinary General Meeting authorising actions to be implemented in connection with the Agreement related, among other things, to:

1. future conclusion by the Company of an agreement or agreements between the Company’s creditors, including: Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląsk S.A., Santander Bank Polski S.A., CaixaBank S.A. Branch in Poland, BNP Paribas Bank Polski S.A., the European Investment Bank and the European Bank for Reconstruction and Development, Banco Santander S.A. Frankfurt Branch, Santander Factoring Sp. z o.o., Pekao Faktoring Sp. z o.o., ING Commercial Finance Polska S.A. and BNP Paribas Faktoring Sp. z o.o. (or some of these entities) to which the Company or certain other companies of the Grupa Azoty Group would be parties, with the proviso that such agreement or agreements could provide, without limitation, for:

(i) the appointment of a financial institution indicated therein as a security agent or to act in a similar role (the “Security Agent”),

(ii) an irrevocable and unconditional obligation of the Company to pay to the Security Agent specific sums in the currency and in amounts equal to any amounts payable by the Company to each of the creditors named in the relevant agreement between the Company’s creditors as such amounts become or would become due and payable under the relevant document, i.e. a Parallel Debt obligation, or any other obligation of the Company to pay certain amounts to a specified entity as they become or would become due and payable under the relevant document;

2. the basic scope of security interests to be established over selected assets of the Company, including the creation of registered pledges (e.g. a floating charge over a set of movables or rights or other groups of assets), financial or civil pledges, creation of joint contractual mortgages over ownership or perpetual usufruct rights, and notarised consent to enforcement.

The other key companies of the Grupa Azoty Group, including Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., will request their respective governing bodies for approval of the creation of similar security interests over their own assets.

These decisions have been made as part of the schedule of steps agreed with the financing institutions with a view to developing a long-term agreement concerning the Grupa Azoty Group’s financing.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 38/2024 of 5 April 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 21 June 2024 the Annual General Meeting of the Company’s subsidiary Grupa Azoty Zakłady Chemiczne Police S.A. (the “Subsidiary”), acting pursuant to Art. 397 of the Commercial Companies Code, passed a resolution regarding continuation of the Subsidiary’s existence, confirming that the Subsidiary would continue as a going concern.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, the updated documents concerning item 15 of the agenda of the Company’s Annual General Meeting convened for 27 June 2024. The previous versions of these documents were published by Current Report No. 58/2024 of 24 May 2024.

As of the date hereof, the documents have been supplemented with Supervisory Board resolutions of 18 June 2024 on providing an opinion on discharging Members of the Management Board of liability for their activities in 2023.

The adoption of theses resolutions necessitated changes in the statements of reasons for the draft discharge resolutions to be submitted to the Annual General Meeting for consideration.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024 , No. 46/2024 of 26 April 2024 and No 61/2024 of 29 May 2024,  the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 14 June 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 31 July 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 31 July 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 36/2024 of 29 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 7 June 2024 the Extraordinary General Meeting of the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”), acting pursuant to Art. 397 of the Commercial Companies Code, passed a resolution regarding continuation of the Subsidiary’s existence, confirming that the Subsidiary would continue its existence.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Extraordinary General Meeting held on 16 May 2024 and resumed after an adjournment on 4 June 2024, specifying the number of votes conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at that Extraordinary General Meeting and in the total voting rights.

Legal basis: Art. 70.3 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies (consolidated text: Dz.U. of 2024, item 620).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 51/2024 of 16 May 2024, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, the resolutions voted on by the Company’s Extraordinary General Meeting resumed after an adjournment on 4 June 2024, together with the results of voting on the resolutions. 

Documents pertaining to matters voted on at the Extraordinary General Meeting have been posted on the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia and attached to Current Report No. 48/2024 of 13 May 2024, Current Report No. 49/2024 of 14 May 2024, and Current Report No. 62/2024 of 31 May 2024.

The Management Board also provides, attached to this Current Report, draft resolutions which were put to the vote but were not carried.

During the Extraordinary General Meeting resumed after an adjournment on 4 June 2024, no objections were raised to be recorded in the minutes.

The resolutions voted on by the Extraordinary General Meeting on 16 May 2024 were previously disclosed by the Company together with Current Report No. 52/2024 of 16 May 2024.

Legal basis: Section 19.1.6 and Section 19.1.8 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 4 June 2024, the Extraordinary General Meeting passed a resolution to appoint Robert Bednarski to the Company’s Supervisory Board.

At the same time, the Extraordinary General Meeting passed a resolution to appoint Artur Kucharski, who previously served as Deputy Chair of the Supervisory Board, as Chair of the Supervisory Board.

These resolutions took effect upon adoption.

Robert Bednarski has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of governing bodies of any other competing legal entities. 

The representation received by the Company includes a statement to the effect that the new Member of the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

A brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Member of the Company’s Supervisory Board is attached to this Current Report.

Legal basis: Section 5.5 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 31 May 2024 it received a notice from Mr Jacek Lampart, a shareholder of the Company, withdrawing his own candidature to the Supervisory Board, proposed on 26 April 2024 with reference to item 7 of the agenda of the Extraordinary General Meeting convened for 16 May 2024 (and adjourned to 4 June 2024), as announced by the Company in Current Report No. 45/2024.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it received a notice dated 30 May 2024 from Towarzystwo Funduszy Inwestycyjnych PZU Spółka Akcyjna, acting on behalf of the investment fund PZU SFIO Universum managed by Towarzystwo Funduszy Inwestycyjnych PZU SA of Warsaw, being a shareholder of the Company, to the effect that during the Company’s Extraordinary General Meeting convened for 16 May 2024 and adjourned to 4 June 2024,the Fund plans to nominate Mr Marcin Paluch as a candidate for member of the Grupa Azoty S.A. Supervisory Board.

 A brief description of the educational background, qualifications, previously held positions and employment record of the candidate to the Company’s Supervisory Board has been attached by the Company to this Current Report.

The Company’s Management Board further reports that the candidate for member of the Supervisory Board has submitted a representation stating that he is not a member of the supervisory board or management board of any business entity competing with the Company, does not have an employment relationship with such entity or provide work or services to such entity on a similar legal basis, nor is he a partner or shareholder in any competing business entity.

The representation received by the Company includes a statement to the effect that the candidate to the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024, No. 34/2024 of 28 March 2024 and No. 46/2024 of 26 April 2024,  the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 May 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 14 June 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 14 June 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023, Current Report No. 10/2024 of 2 February 2024, Current Report No. 23/2024 of 29 February 2024, Current Report No. 33/2024 of 27 March 2024 and Current Report No. 44/2024 of 26 April 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 May 2024 the Company, acting on its own behalf and on behalf of certain Grupa Azoty Group companies (the “Grupa Azoty Group”), as listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex, effective as of 28 May 2024  (the “Annex”), to the standstill agreement signed on 2 February 2024 (as subsequently amended) with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Oddział w Polsce, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A. Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures the continued availability of credit facility limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in the event of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex until 30 July 2024.

This will facilitate the continued development of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities.

The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 28 May 2024 it received a notice from Mr Jacek Heliodor Lampart, a shareholder of the Company, proposing himself as a candidate to the Supervisory Board of the 12th term of office, with reference to item 18 of the agenda of the Annual General Meeting convened 27 June 2024.

A brief description of the educational background, qualifications, previously held positions and employment record submitted by the candidate to the Company’s Supervisory Board is provided below.

Jacek Heliodor Lampart, aged 63, has secondary education. He runs his own business. His experience includes serving as Chair of the Supervisory Board of the Pomeranian Regional Development Agency of Słupsk. As represented by Mr Lampart, he has been involved in the work of companies through active participation in the General Meetings for more than 30 years. He has been actively involved with Grupa Azoty S.A. as its shareholder for more than 10 years.

The Company’s Management Board also announces that the candidate has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the candidate to the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Annual General Meeting of the Company convened for 27 June 2024, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes the Annual General Meeting of the Company to be held on 27 June 2024, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Section 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 53/2024 of 17 May 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 23 May 2024 the Company’s Supervisory Board issued a positive assessment of the proposal of the Company’s Management Board that the Company’s net loss for the financial year ended 31 December 2023, amounting to PLN 1,600,306,401.62, be fully covered from the Company’s share premium account.

The Supervisory Board gave a favourable opinion on the Management Board’s proposal concerning coverage of the net loss for the financial year 2023, as stated above, submitted to the Annual General Meeting.

A final decision on coverage of the net loss for the financial year 2023 will be made by the Annual General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, selected estimated consolidated financial results of the Grupa Azoty Group (the “Group”) for the three months ended 31 March 2024.

Discussion of Q1 2024 estimated results

In the three months ended 31 March 2024, the Grupa Azoty Group generated estimated consolidated revenue of PLN 3,399 million and EBITDA of PLN -50 million, with an EBITDA margin of -1.5%.

The first quarter of 2024 witnessed ongoing challenges due to adverse global macroeconomic conditions. Overall demand for the Grupa Azoty Group’s products remained insufficient for the Group to regain operating profitability, especially amid a further decline in product selling prices.

In the reporting quarter, the prices of all raw materials used in production also experienced significant year-on-year declines, which in the case of the key feedstock, natural gas, reached 50% (based on TTF prices). The unit costs of energy carriers such as electricity and coal also fell. However, these declines were not substantial enough to deliver a positive EBITDA margin.

Main factors with bearing on the Grupa Azoty Group’s financial performance within the key segments in Q1 2024 compared with Q1 2023:

Agro

In the Agro Segment, key performance drivers in the three months ended 31 March 2024 included an uptick in production volumes and sales, with a concurrent market-wide decline in the prices for products, raw materials and agricultural crops compared to the same period last year.

Increased purchasing activity of customers translated into year-on-year growth in fertilizer sales, both in the case of nitrogen and compound fertilizers (up by 52% and 37%, respectively). The increase in customer activity has been weaker this year and interest in the segment's products only began to pick up toward the quarter’s end. The fertilizer market faced challenges due to the prolonged downward trend in crop prices, spanning a number of months, as well as pressure from fertilizer imports from outside the EU, encompassing both pricing and supply aspects given increased product volumes available on the market.

In the Agro Segment, a significant year-on-year decline was observed in the price of the key feedstock for nitrogen fertilizers, that is natural gas, which offset the decline in product prices, allowing the segment to ultimately report a positive EBITDA margin. Also in the case of compound fertilizers, the prices of key raw materials (phosphate rock and potassium chloride) fell significantly year on year.

The Agro Segment’s EBITDA margin generated in the three months ended 31 March 2024 came in at 1.2%.

Chemicals

The Chemicals Segment experienced a year-on-year decline in sales volumes during the three months to 31 March 2024, accompanied by a reduction in both raw material and product prices.

The segment’s performance was adversely impacted by the persistently challenging global macroeconomic climate and ongoing low structural demand for its products. Conversely, logistic disruptions, leading to extended delivery times and driving up transport costs for imported products, were a positive factor stimulating interest in products from European manufacturers. Additionally, a drop in raw material prices, such as propylene, positively influenced the segment. Despite this, the prices of all segment products were lower year on year, with the most significant declines observed for NOXy, Pulnox and technical grade urea.

At the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. one of the melamine production units came back on-stream.

The Chemicals Segment’s EBITDA margin for the three months ended 31 March 2024 came in at -14.9%.

Plastics

The Plastics Segment recorded a year-on-year increase in both production and sales volumes in the three months to 31 March 2024, with a concurrent decrease in raw material (phenol) and product prices.

The European market experienced an economic downturn, with escalating geopolitical tensions adversely affecting consumer buying sentiment. Logistic constraints caused by the Red Sea attacks led to reduced and delayed imports of PA6 and its derivatives from Asia, thereby boosting demand for the European products. However, real demand from the primary product application sectors in Europe remained subdued, albeit stable, resulting in only a modest year-on-year increase in polyamide sales by the Grupa Azoty Group.

Due to the continued demand-supply challenges in the first quarter of 2024, production of caprolactam at the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. was not resumed in the period.

The Plastics Segment’s EBITDA margin for the three months ended 31 March 2024 came in at -13.4%. The segment’s results also encompass the production and sales activities of the Company’s subsidiary Grupa Azoty Polyolefins S.A., which is currently at the stage of plant commissioning and test runs.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the three months ended 31 March 2024, scheduled to be published on 28 May 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of 22 February 2023, the Management Board of Grupa Azoty S.A. announces that the Company will discontinue the monthly publication of production volume data starting from April 2024.

Production volume data will be reported on a quarterly basis in periodic reports.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 17 May 2024, it passed a resolution proposing that the Company’s net loss for the financial year ended 31 December 2023, amounting to PLN 1,600,306,401.62, be fully covered from the Company’s share premium account.

In order to implement this resolution, the Management Board will request:

• The Supervisory Board to assess and give an opinion on the proposal.
• The General Meeting to vote on a resolution to cover the net loss for the financial year 2023. The final decision on the coverage of the 2023 net loss will be made by the General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Extraordinary General Meeting (“EGM”) on 16 May 2024, together with the results of voting on the resolutions.

As there was only one nomination for Chair of the EGM, the Extraordinary General Meeting elected the Chair by acclamation, as permitted under Section 10 of the Rules of Procedure for the General Meeting.

Considering that a professional third party was commissioned to provide technical and organisational support for the General Meeting, the Extraordinary General Meeting resolved not to appoint a Ballot Counting Committee and not to vote on the resolution to abolish the secrecy of voting.

During the Extraordinary General Meeting, an objection was raised and recorded in the minutes with regard to Resolution No. 1.

The Company’s Management Board also provides, attached to this Current Report, a draft resolution which was put to the vote, but was not carried.

Legal basis: Section 19.1.6, Section 19.1.7, Section 19.1.8, and Section 19.1.9 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Extraordinary General Meeting convened for 16 May 2024 passed a resolution to adjourn the Meeting.

The Extraordinary General Meeting will resume at 10am on 4 June 2024 at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland.

Legal basis: Section 19.1.5 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 7/2024 of 26 January 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the release date for the consolidated report for the first quarter of 2024 has been changed from 22 May 2024 to 28 May 2024.

The release dates for the interim reports for the first half and the third quarter of 2024 remain unchanged, with the updated release dates for interim reports in 2024 provided below:

1. Quarterly reports:

• Q1 2024 complete consolidated report – 28 May 2024
• Q3 2024 complete consolidated report – 6 November 2024

2. Half-year report:

• H1 2024 complete consolidated report – 28 August 2024

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information                                                                                                                                    

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 14 May 2024, it received the nomination of Piotr Dziwok as a candidate for the Company’s Supervisory Board from Nationale-Nederlanden Otwarty Fundusz Emerytalny of Warsaw, represented by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. The nomination pertains to item 7 of the agenda for the Extraordinary General Meeting of the Company scheduled for 16 May 2024.

A brief description of the educational background, qualifications, previously held positions and employment record of the candidate to the Company’s Supervisory Board is attached to this current report.

The Company’s Management Board also announces that the candidate has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the candidate to the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 13 May 2024 it received a notification from the Ministry of State Assets – acting on behalf of the State Treasury, which is a shareholder of the Company – that Mr Robert Bednarski has been nominated as a candidate for a member of the Company’s Supervisory Board. The notification was sent in connection with item 7 of the agenda of the Extraordinary General Meeting of the Company convened for 16 May 2024.

The candidate has received a positive opinion from the Council for State-Owned Companies and State Legal Persons, referred to in Art. 19.1 of the Act on State Property Management of 16 December 2016, and meets the requirements set out in the laws of general application.

A brief description of the educational background, qualifications, previously held positions and employment record of the candidate to the Company’s Supervisory Board is attached to this current report.

The Company’s Management Board also announces that the candidate has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the candidate to the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 April 2024 the Company was notified that on 26 April 2024 the District Court for Kraków-Śródmieście in Kraków, 12th Commercial Division of the National Court Register, registered amendments to the Company’s Articles of Association.

The registered amendments were adopted by Resolution No. 16 of the Company’s Extraordinary General Meeting held on 14 February 2024.

On 19 February 2024, the Company’s Supervisory Board resolved to restate the Articles of Association of the Company by incorporating the amendments adopted by Resolution No. 16 of the Extraordinary General Meeting of 14 February 2024.

The restated Articles of Association are attached as an appendix hereto.

The amendments to the Articles of Association are detailed in a separate appendix hereto.

Legal basis: Par. 5.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023, No. 22/2024 of 29 February 2024 and No. 34/2024 of 28 March 2024 the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 26 April 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 29 May 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 29 May 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 26 April 2024 it received a notice from Mr Jacek Heliodor Lampart, a shareholder of the Company, proposing himself as a candidate to the Supervisory Board, with reference to item 7 of the agenda of the Extraordinary General Meeting convened 16 May 2024.

A brief description of the educational background, qualifications, previously held positions and employment record submitted by the candidate to the Company’s Supervisory Board is provided below.

Jacek Heliodor Lampart, aged 63, has secondary education. He runs his own business. His experience includes serving as Chair of the Supervisory Board of the Pomeranian Regional Development Agency of Słupsk. As represented by Mr Lampart, he has been involved in the work of companies through active participation in the General Meetings for more than 30 years. He has been actively involved with Grupa Azoty S.A. as its shareholder for more than 10 years.

The Company’s Management Board also announces that the candidate has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the candidate to the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023, Current Report No. 10/2024 of 2 February 2024, Current Report No. 23/2024 of 29 February 2024 and Current Report No. 33/2024 of 27 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 25 April 2024 the Company, acting on its own behalf and on behalf of certain Grupa Azoty Group companies (the “Grupa Azoty Group”), as listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex (the “Annex”) to the standstill agreement signed on 2 February 2024 (as subsequently amended) with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Oddział w Polsce, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A. Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures the continued availability of credit facility limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in the event of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex until 28 May 2024. This will facilitate the continued development of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities. The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Furthermore, on 25 April 2024, the Company, acting on its own behalf and on behalf of the other Grupa Azoty Group companies being parties to the Financing Agreements, executed Waiver and Amendment Letters with the Financing Parties whereby these institutions consented to waive selected covenants under the Grupa Azoty Group’s Financing Agreements, including waiver of the covenant regarding the net debt to EBITDA ratio tested as at 31 December 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, in an appendix to this Report, the estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the fourth quarter of 2023 and for 2023.

Discussion of Q4 2023 results

In the fourth quarter of 2023, the Grupa Azoty Group generated consolidated revenue of PLN 3,083m and EBITDA of PLN -10m, with an EBITDA margin of -0.3%.

The Group’s results in the fourth quarter of 2023 were adversely affected by significant impairment losses on non-financial non-current assets. The recognition of impairment losses on these assets was announced by the Company in Current Report No. 38/2024 on 5 April 2024.

The impairment losses on non-financial non-current assets recognised following impairment testing led to a PLN 1,562m decrease in the Group’s consolidated EBIT for the fourth quarter of 2023. In accordance with the Group’s accounting policies, impairment losses of PLN 1,425m are one-off non-cash events with no effect on the consolidated EBITDA of the Company. The balance of PLN 137m reduces the EBIT and EBITDA of the Group. Main factors with a bearing on the Group’s financial performance in the key segments in Q4 2023 compared with Q4 2022:

Agro

In the Agro Segment, key performance drivers in the fourth quarter of 2023 included the stabilisation of natural gas, coal, and most other commodity prices, alongside an increase in electricity prices. Additionally, there was a continued downward trend in the prices of agricultural produce, and although demand for nitrogen fertilizers remained relatively stable year on year, there was a weakening observed in the subsequent months of the quarter.

During the period under review, natural gas prices exhibited a diminishing amplitude of change, trending towards relative stability. Spot prices for the TTF index fluctuated between EUR 28/MWh and EUR 55/MWh, with an average for the entire quarter at EUR 41/MWh. This marks a 57% decrease compared to the fourth quarter of 2022.

The purchasing power of the agricultural industry was constrained by low prices of agricultural produce, coupled with the anticipation of further reductions in fertilizer prices. Furthermore, European producers continued to face pressure from low prices for fertilizer imports from outside the EU. In the fourth quarter of 2023, demand for nitrogen and compound fertilizers saw an uptick compared to the same period last year. Consequently, the Group’s total fertilizer production volume rose by 16% in the fourth quarter of 2023, with a 13% increase in sales volume.

The EBITDA margin delivered by the Agro Segment in the fourth quarter of 2023 improved year on year, reaching +5.5%. The Segment’s results were reduced by impairment losses.

Chemicals

In the Chemicals Segment, low demand was recorded in the fourth quarter of 2023, attributed to the unfavourable global macroeconomic conditions, which included the absence of the anticipated economic recovery in China. Customers’ inventories were high, with competitively priced imports from Asia emerging as a significant source of supply. Product sales by volume saw significant declines for most products compared to the same quarter of the previous year. However, there were increases in sales volumes for titanium white, melamine, technical grade urea, and plasticizers. Weak demand for the segment’s products and their oversupply in the market resulted in a decline in the average prices of all Group products in the segment compared to the same period last year, with the largest price declines recorded for technical grade urea (-66% y/y), melamine (-65% y/y) and NOXy (-60% y/y).

As a result of technical issues, Grupa Azoty Zakłady Azotowe Puławy S.A., a subsidiary of the Company, ceased melamine production entirely in November 2023, following earlier production cuts due to market conditions.

The Chemicals Segment’s EBITDA margin for the fourth quarter of 2023 was positive at 2.7%. The Segment’s results were reduced by impairment losses.

Plastics

In the Plastics Segment, the fourth quarter of 2023 saw a year-on-year decrease in raw material (phenol) and product prices. Key sectors consuming PA6 operated at significantly reduced rates, reflecting weak end-user demand and unfavourable macroeconomic conditions. There was a notable improvement in indicators within the automotive sector, although they remained below pre-pandemic levels. Demand in other PA6 application industries, such as packaging, textiles, and consumer goods, was perceived as stable but low.

Due to the challenging demand-supply situation, production of caprolactam at Grupa Azoty Zakłady Azotowe Puławy S.A., a subsidiary of the Company, was suspended in March 2023 and did not resume until the end of the year.

In the fourth quarter of 2023, the Plastics Segment recorded an EBITDA margin of -79.8%, primarily due to the impact of high plant start-up costs incurred by the Company’s subsidiary Grupa Azoty Polyolefins S.A.

Key performance drivers in 2023

In 2023, the Group generated consolidated revenue of PLN 13,545m and EBITDA of PLN -1,366m, with an EBITDA margin of -10.1%.

Last year, the Group faced an extremely challenging financial situation as a result of a combination of internal and external factors.

The Group’s performance during the reporting period was largely due to the Company’s failure to adapt to increasingly challenging market conditions. The first signs of unfavourable market trends were evident as early as 2022, and in June 2023 the Group requested its financing institutions to waive selected covenants. Despite the significant decline in financial performance, the Company failed to come up with a comprehensive plan of corrective measures in the following quarters. As a consequence, this led to a strained relationship with the market and continuously high production costs due to excessive gas purchase costs relative to market prices.

During the reporting period, the prices of gas and most key raw materials stabilised, especially in relation to the dynamic fluctuations seen in 2022, forcing down the prices of the Group’s products. Financial performance was also impacted by unfavourable global macroeconomic conditions, including the lack of significant recovery in many sectors of European and global economies, as well as inflation, particularly high in early 2023. Demand in the key markets was insufficient to ensure profitable production levels, although it improved gradually over the course of 2023. At the same time, the Group failed to take effective measures to optimise production.

The presented amounts are estimates and may be subject to change. The final results will be presented in the consolidated report for the 12 months of 2023, to be issued on 29 April 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the  “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Extraordinary General Meeting of the Company convened for 16 May 2024, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. of Tarnów (the  “Company”) hereby convenes an Extraordinary General Meeting of the Company for 16 May 2024, at 10.00am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Extraordinary General Meeting attached as an appendix hereto.

Legal basis: Section 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 12 April 2024 the Company received a letter of resignation of Mr Hubert Kamola, stepping down from the position of Member of the Company’s Supervisory Board. The resignation took effect at the end of day on 12 April 2024. Mr Hubert Kamola served as Chair of the Company’s Supervisory Board. In addition, he was the Supervisory Board Member delegated as of 20 March 2024 to perform the duties of Vice President of the Company’s Management Board.

Mr Hubert Kamola did not give a reason for his resignation in his letter.

On the same day, the Supervisory Board passed a resolution to appoint Mr Hubert Kamola as a member of the Company’s Management Board of the 12th term of office, effective 13 April 2024, entrusting him with the role of Vice President of the Management Board.

A brief description of the newly appointed Management Board Member’s educational background, qualifications, previously held positions and employment records is attached to this Current Report.

The Company further announces that the new Member of the Management Board has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of the governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the new Member of the Management Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Par. 5.4) and 5.5) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of 22 February 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in March 2024.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces the estimated effect of non-cash events on the Company’s consolidated and separate financial statements for the 2023 financial year.

I. Following impairment testing of non-current assets performed for the Company’s Fertilizers Cash Generating Unit (CGU) and Plastics Cash Generating Unit (CGU), it was determined that the estimated recoverable amount of assets was below their carrying amount for the Plastics CGU. As a result, a decision was made to recognise an impairment loss of - (minus) PLN 59m. This stems from the projected decline in profitability, driven by the weakening of long-term market forecasts. No need to recognise impairment losses for the Fertilizers CGU was identified.

This event affects the Company’s financial statements for 2023 by reducing the separate EBIT by - (minus) PLN 59m. In accordance with Grupa Azoty Group’s accounting policies, the impairment loss is a one-off non-cash event with no effect on the Company’s separate EBITDA.

Following impairment testing of non-current assets at the Company’s subsidiaries, it was determined that the recoverable amount of assets was below the carrying amount for the Fertilizers CGU at Grupa Azoty Zakłady Chemiczne Police S.A. (“Grupa Azoty POLICE”). As a result, a decision was made to recognise an impairment loss of - (minus) PLN 151m.

The impairment loss at the Fertilizers CGU was recognised primarily as a result of the deterioration of long-term market forecasts and future cash flow projections, particularly for technical-grade nitrogen products.

The Company also announces, further to Current Reports No. 14/2024 of 9 February 2024 and No. 36/2024 of 29 March 2024, that following verification by the auditor of the impairment test submitted for audit, the impairment loss on assets at Grupa Azoty Polyolefins S.A. (“Grupa Azoty POLYOLEFINS”) has increased by - (minus) PLN 206m to - (minus) PLN 1,343m.

These events affect the Company’s financial statements for 2023 by reducing consolidated EBIT by PLN 1,494m. In accordance with Grupa Azoty Group’s accounting policies, the impairment losses are one-off non-cash events with no effect on the Company’s consolidated EBITDA.

The above events related to the recognition of impairment losses on non-current assets in the Company and its subsidiaries affect the Company’s consolidated financial statements for 2023 by reducing consolidated EBIT by a total amount of PLN 1,553m. In accordance with Grupa Azoty Group’s accounting policies, the impairment losses are one-off non-cash events with no effect on the Company’s consolidated EBITDA.

II. Moreover, the following categories of events have been identified in connection with the update of Grupa Azoty POLYOLEFINS’ Financial Model, as announced by the Company in Current Report No. 36/2024 of 29 March 2024, with a significant effect on the Company’s results:

1. Remeasurement in relation to the valuation as at 30 September 2023 of the put and call options held by the Shareholders of Grupa Azoty POLYOLEFINS in the amount of - (minus) PLN 145m decreases the separate pre-tax result in the fourth quarter of 2023;
2. The calculation of the expected estimated loss on loans granted by the Company to Grupa Azoty POLYOLEFINS in the amount of - (minus) PLN 138m reduces the separate pre-tax result in the fourth quarter of 2023.

The events described in Sections II.1 and II.2 have no effect on the Company’s separate EBIT and EBITDA.

3. Recognition of a Liability resulting from the rate-of-return stabilisation mechanism for the Co-Sponsors, set out in Grupa Azoty POLYOLEFINS’ Shareholders’ Agreement, in the amount of - (minus) PLN 104m, which reduces the consolidated pre-tax result by - (minus) PLN 104m and the separate pre-tax result by - (minus) PLN 49m.

The event described in Section II.3 has no effect on the Company’s separate and consolidated EBIT and EBITDA.

III. In addition, the events indicated in Sections I and II result in the Company having to write down the value of shares in the subsidiaries in the separate financial statements for 2023:

1. Grupa Azoty POLICE – by approximately - (minus) PLN 503m;
2. Grupa Azoty POLYOLEFINS – by - (minus) PLN 463m, up by PLN 63m from the previously estimated amount of - (minus) PLN 400m specified in Current Report No. 36/2024 of 29 March 2024.

The potential estimated non-cash effect of the event described in Section III reduces the pre-tax result disclosed in the Company’s separate financial statements for 2023 by approximately - (minus) PLN 966m, compared with the original estimate of - (minus) PLN 400m.

The event has no effect on the Company’s separate and consolidated EBIT and EBITDA.

1. The events related to the update of Grupa Azoty POLYOLEFINS’ Financial Model have an effect on the separate and consolidated results of the Company’s subsidiary, Grupa Azoty POLICE, as announced by Grupa Azoty POLICE in Current Report No. 24/2024 of 5 April 2024. At the same time, the Management Board of Grupa Azoty POLICE has announced that, considering the above estimates, there will be grounds for convening a General Meeting under Article 397 of the Code of Commercial Companies, concerning adoption of a resolution on the company’s continued existence as a going concern.

The Company’s 2023 financial statements are being verified and audited by the auditor, so the above estimates are subject to change. The final amounts will be presented in the Company’s consolidated and separate full-year report, scheduled for issue on 29 April 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 7/2024 of 26 January 2024, the Management Board of Grupa Azoty S.A. announces that the release date for the separate and consolidated full-year reports for 2023 has been changed from 10 April 2024 to 29 April 2024.

The 2023 consolidated report on payments to governments will be released on 29 April 2024.

The release dates for the consolidated quarterly reports and the consolidated half-year report remain unchanged. The revised timetable for releasing the periodic reports in 2024 is as follows:

1. Quarterly reports:

• Q1 2024 complete consolidated report – 22 May 2024
• Q3 2024 complete consolidated report – 6 November 2024

2. Half-year report:

• H1 2024 complete consolidated report – 28 August 2024

3. Full-year reports:

• 2023 separate full-year report – 29 April 2024
• 2023 consolidated full-year report – 29 April 2024.

The 2023 consolidated report on payments to governments will be released on 29 April 2024.

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 14/2024 of 9 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) presents an update of the estimated effect of one-off non-cash events on the Company’s consolidated and separate financial statements for 2023.

The Management Board announces that during the preparation of the full-year consolidated financial statements for 2023, indications of asset impairment were identified at the subsidiary Grupa Azoty Polyolefins S.A. (“Grupa Azoty POLYOLEFINS”, “Subsidiary”), affecting the value of the Company’s assets.

Following an update of the Subsidiary’s Financial Model, made to reflect current market forecasts, macroeconomic data, and operational information, which showed a deterioration in the financial indicators of the Polimery Police Project compared to the Financial Model used for the asset impairment test at the end of 2022, impairment tests performed at Grupa Azoty POLYOLEFINS showed valid reasons for the recognition of an impairment loss on the Subsidiary’s assets.

Consequently, the Management Board of the Subsidiary will propose to the General Meeting of Grupa Azoty POLYOLEFINS to vote on a resolution regarding the continued existence of the Subsidiary, as required by Art. 397 of the Commercial Companies Code.

The potential estimated non-cash effect of the above event will reduce consolidated EBIT for 2023 by approximately - (minus) PLN 1,138m, compared with the initial estimate of - (minus) PLN 900m, as announced by the Company in Current Report No. 14/2024. The event will have no effect on consolidated EBITDA.

In addition, the impairment loss on Grupa Azoty POLYOLEFINS’ assets in the full-year consolidated financial statements for 2023 may necessitate recognition of an impairment loss of approximately - (minus) PLN 400m on the Subsidiary’s shares in the Company’s full-year separate financial statements for 2023, compared with the initial estimate of - (minus) PLN 300m, as announced by the Company in Current Report No. 14/2024.

The potential estimated non-cash effect of the above event will be a reduction of the pre-tax profit/loss disclosed in the Company’s full-year separate financial statements for 2023 by approximately - (minus) PLN 400m, compared with the initial estimate of - (minus) PLN 300m. The impairment loss will be charged against finance costs so it will not reduce the Company’s separate EBIT and EBITDA for 2023.

The Company’s 2023 financial statements are being reviewed and audited by the auditor, so the above estimates are subject to change. The Company’s full-year consolidated and separate report is scheduled for issue on 10 April 2024.

The potential estimated non-cash effect of the impairment loss recognised on a portion of Grupa Azoty POLYOLEFINS assets may affect other components of the Company’s financial statements. The Company is currently analysing the effect on other components of its financial statements.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information                                                                                                   

Further to Current Report No. 22/2022 of 20 July 2022, Current Report No. 37/2022 of 23 December 2022, Current Report No. 48/2023 of 19 October 2023, Current Report No. 61/2023 of 15 December 2023, Current Report No. 24/2024 of 11 March 2024, and Current Report No. 26/2024 of 13 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 28 March 2024 it passed a resolution to terminate negotiations with the shareholders of Solarfarm Brzezinka sp. z o.o. of Wrocław (“Solarfarm”) (VSB Holding GmbH of Dresden, Germany, and Mr Janusz Franciszek Siemieniec) and to terminate the agreement to hold negotiations, on an exclusive basis, regarding the potential acquisition of 100% of the share capital of Solarfarm, the company established to implement a minimum 270MWp solar PV power plant project located in Brzezinka and Syców in the Province of Wrocław.

The reason for the termination of negotiations is the negative opinion of the Company’s Supervisory Board regarding the proposed acquisition of Solarfarm, which was submitted by the Management Board for approval by the Extraordinary General Meeting (Current Report No. 24/2024), and failure by the Extraordinary General Meeting (held on 14 February 2024 and resumed after adjournment on 13 March 2024) to adopt the relevant resolution (Current Report No. 26/2024). Approval from the Extraordinary General Meeting was a necessary condition for the execution of the agreement to acquire 100% of shares in Solarfarm.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 62/2023 of 15 December 2023 and No. 22/2024 of 29 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 February 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 26  April 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 26  April 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023, Current Report No. 10/2024 of 2 February 2024 and Current Report No. 23/2024 of 29 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 27 March 2024 the Company, acting on its own behalf and on behalf of the Grupa Azoty Group companies (the “Grupa Azoty Group”) listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex, effective as of 26 March 2024 (the “Annex”), to the standstill agreement signed on 2 February 2024 with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Oddział w Polsce, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A. Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures the continued availability of credit facility limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in the event of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex until 25 April 2024.

This will facilitate the continued development of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities.

The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 31/2024 of 21 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached hereto, a brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Member of the Company’s Supervisory Board, Artur Rzempała.

The Company further announces that Artur Rzempała has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the new Member of the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Sec. 5.5 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces the receipt, on 21 March 2024, of a statement from the Undersecretary of State at the Ministry of State Assets, authorised to act on behalf of the Minister of State Assets, dated 21 March 2024, on the appointment, pursuant to Art. 16.2 of the Company’s Articles of Association, of Artur Rzempała to the Company’s Supervisory Board.

A brief description of the newly appointed Supervisory Board Member’s educational background, qualifications, previously held positions and employment record, together with all the representations he is required to submit, will be published by the Company as soon as practicable.

Sec. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 29/2024 of 19 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached hereto, a brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Members of the Company’s Supervisory Board:

Adam Leszkiewicz – President of the Management Board
Krzysztof Kołodziejczyk – Vice President of the Management Board
Andrzej Skolmowski – Vice President of the Management Board
Andrzej Dawidowski – Vice President of the Management Board
Paweł Bielski – Vice President of the Management Board
Hubert Kamola – Supervisory Board Member delegated to serve as Vice President of Management Board of the Company.

The newly appointed Members of the Management Board of the Company have submitted representations to the effect that the activities they are engaged in outside the Company are not competing with the Company’s business and that they are not shareholders in any company or partners in any partnership under civil law or another type of partnership and are not members of the governing bodies of any companies or other legal persons competing with the Company’s business.

The representations also include statements to the effect that the new Members of the Management Board of the Company are not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Sec. 5.5 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 19 March 2024 the Company’s Supervisory Board passed a resolution to remove Mr Marek Wadowski from the position of Vice President of the Company’s Management Board with effect from the end of day on 19 March 2024. The resolution became effective upon adoption.

At the same time, the Company’s Supervisory Board passed resolutions to appoint, with effect from 20 March 2024, the following persons to the Company’s Management Board of the 12th term:

Mr Adam Leszkiewicz – as President of the Management Board,
Mr Krzysztof Kołodziejczyk – as Vice President of the Management Board,
Mr Andrzej Skolmowski – as Vice President of the Management Board,
Mr Andrzej Dawidowski – as Vice President of the Management Board,
Mr Paweł Bielski – as Vice President of the Management Board.

The Supervisory Board also passed a resolution to delegate Mr Hubert Kamola, Member of the Supervisory Board, to serve as acting Vice President of the Management Board in the period from 20 March 2024 to the date of appointment of a Management Board Vice President selected through a recruitment process, that period not to be longer than three months.

The resolutions to appoint members of the Management Board and delegate a member of the Supervisory Board to serve as acting Vice President of the Management Board came into effect upon adoption.

A brief description of the newly appointed Management Board Members’ educational background, qualifications, previously held positions and employment records, together with the representations required from them, will be published by the Company as soon as practicable.

Legal basis: Section 5.4 and Section 5.5 of the Polish Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 19 March 2024 the Company received a letter of resignation of Mr Krzysztof Kołodziejczyk, stepping down from the position of Member of the Company’s Supervisory Board. The resignation took effect at the end of day on 19 March 2024.

Mr Krzysztof Kołodziejczyk did not give a reason for his resignation in his letter.

Legal basis: Par. 5.4) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Extraordinary General Meeting convened on 14 February 2024 and resumed after an adjournment on 13 March 2024, specifying the number of votes conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at that Extraordinary General Meeting and in the total voting rights.

Legal basis: Art. 70.3 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies (consolidated text: Dz.U. of 2022, item 2554, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a draft resolution considered by the Extraordinary General Meeting of Grupa Azoty S.A. convened on 14 February 2024 and continued after an adjournment on 13 March 2024. 

The resolution, provided as an appendix to this current report, has not been adopted.

The Extraordinary General Meeting , reconvened on 13 March 2024 after an adjournment, did not pass any resolutions. Resolutions passed by the Extraordinary General Meeting of the Company on 14 February 2024 were previously disclosed by the Company together with Current Report No. 20/2024 of 15 February 2024.

Legal basis: Sec. 19.1.8 of the Minister of Finance’s Regulation of 29 March 2018 on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of 22 February 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in February 2024.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 2/2024 and Current Report No. 3/2024 of 10 January 2024, Current Report No. 5/2024 of 18 January 2024 and Current Report No. 6/2024 of 25 January 2024, in connection with the Extraordinary General Meeting convened for 14 February 2024 (the “EGM”), to be resumed after an adjournment on 13 March 2024, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto as a supplementary document relating to matters placed on the EGM’s agenda, the resolution of the Company’s Supervisory Board of 11 March 2024 concerning:

• providing an opinion on the matter and the Management Board’s request to the General Meeting concerning acquisition by the Company of 100% of the shares in the share capital of Solarfarm Brzezinka Sp. z o.o.

The Company will post the documents in the General Meeting section of its website.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023, Current Report No. 41/2023 of 31 August 2023 and Current Report No. 10/2024 of 2 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 February 2024 the Company, acting on its own behalf and on behalf of the Grupa Azoty Group companies (the “Grupa Azoty Group”) listed in the appendix to Current Report No. 10/2024, being parties to the relevant financing agreements (the “Financing Agreements”), executed an amending annex, effective as of 28 February 2024 (the “Annex”), to the standstill agreement signed on 2 February 2024 with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. Oddział w Polsce, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A. Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank (the “Standstill Agreement”).

The Annex to the Standstill Agreement ensures continued availability of credit limits under the Financing Agreements, prevents the Financing Institutions from taking any steps to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in case of a breach or potential breach of the Financing Agreements occurring during the term of the Standstill Agreement, which has been extended under the Annex to 25 March 2024 (and, after the availability of one of the working capital facilities is extended at least to 26 March 2024, will also be extended to 26 March 2024).

This will facilitate the development of a long-term restructuring plan for the Grupa Azoty Group. The Standstill Agreement may be subject to further extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide certain documents to the Financing Institutions in accordance with the agreed schedule, and to continue to apply the agreed restrictions provided for in the Standstill Agreement on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities.

The Company fulfils all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits thereunder ensure liquidity and secure financing for the Grupa Azoty Group to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 62/2023 of 15 December 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 29 February 2024 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with Alior Bank S.A., Bank Gospodarstwa Krajowego, Bank Ochrony Środowiska S.A., Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska S.A., the European Bank for Reconstruction and Development, Haitong Bank Polska S.A., ICBC Standard Bank PLC, Industrial and Commercial Bank of China (Europe) S.A. (Spółka Akcyjna) Poland Branch, mBank S.A., Powszechna Kasa Oszczędności Bank Polski S.A., Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2 and Santander Bank Polska S.A. (the “Financial Institutions”) an amending agreement (the “Amendment”) to the stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of 31 May 2020. Under the Amendment, the parties have agreed on the terms under which the Financial Institutions will provide financing of the Project during another term of the Stabilisation Agreement, i.e. until 27 March 2024.

It has also been agreed that the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of the balance of the support loan of up to EUR 105m (the upper limit) to the Subsidiary will be made by 27 March 2024 at the latest.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Polish Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 19 February 2024 the Supervisory Board passed resolutions to remove the following Members from the Management Board:

• Tomasz Hinc
• Mariusz Grab
• Filip Grzegorczyk
• Grzegorz Kądzielawski
• Marcin Kowalczyk

The resolutions became effective upon adoption.

At the same time, the Supervisory Board passed a resolution to delegate Krzysztof Kołodziejczyk, Member of the Supervisory Board, to serve as acting President of the Management Board in the period from the date of the resolution until the appointment of a new President of the Management Board selected through a recruitment process, that period not to be longer than three months. The resolution became effective upon adoption.

The Company further announces that Krzysztof Kołodziejczyk has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of governing bodies of any other competing legal entities. 

The representation received by the Company includes a statement by Krzysztof Kołodziejczyk to the effect that he is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

A brief description of the educational background, qualifications, previously held positions and employment record of Krzysztof Kołodziejczyk, delegated to temporarily serve as President of the Management Board, is attached to this Current Report.

Legal basis: Section 5.4 and Section 5.5 of the Polish Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed to date by the Company’s Extraordinary General Meeting (“EGM”) on 14 February 2024, together with the results of voting on the resolutions.

The documents voted on by the Extraordinary General Meeting are available on the Company’s website at https://tarnow.grupaazoty.com/en/investor-relations/general-meeting-of-shareholders and attached to Current Report No. 3/2024 of 10 January 2024, Current Report No. 5/2024 of 18 January 2024, Current Report No. 6/2024 of 25 January 2024, and Current Report No. 13/2024 of 9 February 2024.

In connection with the use of a computer system for voting and counting the votes, the Extraordinary General Meeting decided not to appoint a Ballot Counting Committee.

The Extraordinary General Meeting decided not to consider item 5 of the agenda ‘Resolution to abolish the secrecy of voting on the election of committees to be appointed by the Extraordinary General Meeting’.

During the Extraordinary General Meeting, the proxy of the Shareholder – the State Treasury submitted corrections to the Shareholder’s draft resolutions:

1. to appoint a member to the Company’s Supervisory Board – the correction consists in removing the phrase “current term of office” in Section 1 of the resolution,
2. to appoint the Chair of the Company’s Supervisory Board – the correction consists in removing the phrase “current term of office” in Section 1 of the resolution.

The Company’s Management Board also provides, attached to this Current Report, a draft resolution which was put to the vote, but was not carried.

Objections to Resolutions No. 4, 5, 6, 7, 8, 9, 10, 12 and 13 were raised by shareholders during the Extraordinary General Meeting for the record in the minutes.

Legal basis: Par. 19.1.6–9 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Extraordinary General Meeting convened for 14 February 2024 passed a resolution to adjourn the Meeting.

The Extraordinary General Meeting will be resumed at 10:00 a.m. on 13 March 2024 at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland.

Legal basis: Par. 19.1.5 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that Current Report No. 18/2024 of 14 February 2024 contains an obvious error, stating incorrect information about a General Meeting resolution to appoint the Chair of the Company’s Supervisory Board.

The report reads:

“At the same time, by resolution of the Company’s Supervisory Board, Mr Hubert Kamola was appointed Chair of the Company’s Supervisory Board.”

The report should read:

“At the same time, by resolution of the Company’s Extraordinary General Meeting, Mr Hubert Kamola was appointed Chair of the Company’s Supervisory Board.”

Legal basis: Par. 5.5 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 14 February 2024 the Extraordinary General Meeting passed resolutions to remove the following persons from the Company’s Supervisory Board:

Ms Magdalena Butrymowicz,
Ms Monika Fill,
Mr Bartłomiej Litwińczuk,
Mr Michał Maziarka.

During the Extraordinary General Meeting held on 14 February 2024, the Company received from a shareholder of the Company – the State Treasury – a nomination of Mr Krzysztof Kołodziejczyk as Member of the Company’s Supervisory Board, in place of Mr Artur Rzempała, previously nominated as a candidate to the Supervisory Board. The Company announced the candidates nominated by the State Treasury in Current Report No. 13/2024 of 9 February 2024.

The Extraordinary General Meeting passed resolutions to appoint the following persons to the Supervisory Board: 

Mr Hubert Kamola,
Mr Krzysztof Kołodziejczyk,
Mr Artur Kucharski,
Mr Piotr Marciniak,Mr Mirosław Sobczyk.

At the same time, by resolution of the Company’s Supervisory Board, Mr Hubert Kamola was appointed Chair of the Company’s Supervisory Board.

The resolutions to remove and appoint Members of the Supervisory Board and to appoint the Chair of the Supervisory Board took effect upon adoption.

The newly appointed Chair and Members of the Supervisory Board submitted representations to the effect that the activities they are engaged in outside the Company are not competing with the Company’s business and that they are not shareholders in any company or partners in any partnership under civil law or another type of partnership and are not members of the governing bodies of any companies or other legal persons competing with the Company’s business. 

The representations also include statements to the effect that the new Chair and Members of the Supervisory Board are not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

A brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Members of the Company’s Supervisory Board is attached to this Current Report.

Legal basis: Par. 5.4 and Par. 5.5 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it has received the resignation of Mr Krzysztof Kołodziejczyk as Member of the Company’s Supervisory Board. The resignation is effective at the end of 13 February 2024.

In the letter, Mr Krzysztof Kołodziejczyk did not give a reason for his resignation.

Legal basis: Par. 5.4) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of 22 February 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in January 2024.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it has received the resignation of Mr Wojciech Krysztofik as Member and Deputy Chair of the Company’s Supervisory Board, effective 11 February 2024.

In the letter, Mr Wojciech Krysztofik did not give a reason for his resignation.

Legal basis: Par. 5.4) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces the estimated effect of one-off non-cash events on the Company’s consolidated and separate financial statements for the 2023 financial year.

The Company’s Management Board announces that in the course of work on the preparation of the full-year consolidated financial statements for 2023, indications of asset impairment at the subsidiary Grupa Azoty Polyolefins S.A. (“Grupa Azoty POLYOLEFINS”, “Subsidiary”), with an effect on the value of the Company’s assets, have been identified.

Following preliminary analyses, impairment tests of Grupa Azoty POLYOLEFINS showed that the Subsidiary’s assets may be impaired. The analyses showed that recognising an impairment loss on some of the assets at the Subsidiary is potentially justified. This is due to the observed decline in the short- and medium-term prospects for the polypropylene market, as well as the reported delays in project implementation.

The potential estimated non-cash effect of the above event will reduce the Company’s consolidated EBIT for 2023 by approximately - (minus) PLN 900m. The event will have no effect on consolidated EBITDA.

In addition, the impairment loss on the Grupa Azoty POLYOLEFINS assets at the level of the full-year consolidated financial statements for 2023 may result in the Company having to recognise an impairment loss of approximately - (minus) PLN 300m on the Subsidiary’s shares in the full-year separate financial statements for 2023.

The potential estimated non-cash effect of the above event will be a reduction of the pre-tax profit/loss disclosed in the Company’s full-year separate financial statements for 2023 by approximately - (minus) PLN 300m. The impairment loss will be charged against finance costs so it will not reduce the Company’s separate EBIT and EBITDA for 2023.

Both the assumptions underlying the asset impairment test and the Company’s 2023 financial statements are being reviewed and audited, respectively, by the auditor, so the above amounts are estimates and are subject to change. The Company’s full-year consolidated and separate report is scheduled for issue on 10 April 2024.

The potential estimated non-cash effect of the impairment loss recognised on a portion of Grupa Azoty POLYOLEFINS assets may affect other components of the Company’s financial statements. The Company is currently analysing the effect on other components of its financial statements.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on 9 February 2024 it received from the Ministry of State Assets, acting on behalf of the State Treasury, which is a shareholder of the Company, information on the submission of the following candidates for members of the Supervisory Board, with reference to items 7 and 8 of the agenda of the Company’s Extraordinary General Meeting convened for 14 February 2024:

Mr Hubert Kamola, also a candidate for the position of Chair of the Supervisory Board,

Mr Mirosław Sobczyk,
Mr Piotr Marciniak,
Mr Artur Rzempala,
Mr Artur Kucharski.

The candidates have received positive opinions from the Council for State-Owned Companies and State Legal Persons, referred to in Art. 19.1 of the Act on State Property Management of 16 December 2016, and meet the requirements set out in the laws of general application.

A brief description of the educational background, qualifications, previously held positions and employment record of each of the above candidates to the Company’s Supervisory Board is attached to this current report.

The Management Board further announces that each of the above candidates to the Company’s Supervisory Board has made a representation to the effect that they are not engaged in any activities competing with the Company’s business, nor are they a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of governing bodies of any other competing legal entities.

The representations received by the Company include a statement to the effect that the candidates to the Supervisory Board are not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 20 April 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 40/2023 of 29 August 2023, Current Report No. 52/2023 of 13 November 2023, Current Report No. 56/2023 of 24 November 2023, and Current Report No. 11/2024 of 2 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 6 February 2024, the Company’s subsidiary, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), received another change proposal from Hyundai Engineering Co., Ltd, the General Contractor for the Polimery Police project, under the turnkey engineering, procurement and construction contract for the Polimery Police project of 11 May 2019 (the “EPC Contract”).

The General Contractor proposes to increase its fee by EUR 5,841,629 representing, according to the General Contractor, the total amount of interest on late payments due for the achievement of the milestones specified in the EPC Contract. As stated in the General Contractor’s proposal, should the Subsidiary reject the change proposal, the General Contractor calls on it to pay the amount of EUR 5,841,629 as interest or compensation for breach of the EPC Contract within 14 days of receipt of the letter.

According to the EPC turnkey contract, it is the General Contractor who is responsible for carrying out all the work at each stage of the project, such as obtaining the relevant permits, procurement and delivery of equipment and materials, construction work, commissioning, and start-up.

According to the Subsidiary, the payment of the General Contractor’s fee was withheld:

• based on the provisions of the EPC Contract, according to which the Subsidiary’s acceptance of each milestone for a given subproject is subject to prior acceptance of all milestones for a given subproject which precede the milestone in question,
• due to the General Contractor’s failure to timely rectify the defects found in the completed work.

The change proposal will be thoroughly reviewed and verified in terms of its validity under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the General Contractor, as well as in the light of relevant facts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 40/2023 of 29 August 2023, Current Report No. 52/2023 of 13 November 2023 and Current Report No. 56/2023 of 24 November 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 2 February 2024, the Company’s subsidiary, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), received a Change Proposal from Hyundai Engineering Co., Ltd, the General Contractor for the Polimery Police project, under the turnkey engineering, procurement and construction contract for the Polimery Police project of 11 May 2019 (the “EPC Contract”).

The Change Proposal seeks an extension of the completion date of the Polimery Police project by an additional 95 days (in addition to the 166 days indicated in the notification of the General Contractor’s initiation of the Change Proposal procedure under the EPC Contract to extend the project completion date, announced in Current Report No. 52/2023 of 13 November 2023) and an increase in the General Contractor’s remuneration by EUR 39,772,455.

The General Contractor cites events occurring in 2023 and 2024 that affected specific parts of the project and, in their opinion, prevented the start-up of the installation to achieve its guaranteed parameters as the reasons for the extension of the completion deadline and the increase in remuneration.

According to the EPC turnkey contract, it is the General Contractor who is responsible for carrying out all the work at each stage of the project, such as obtaining the relevant permits, procurement and delivery of equipment and materials, construction work, commissioning, and start-up.

The Change Proposal will be thoroughly reviewed and verified in terms of its validity under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the General Contractor, as well as in the light of relevant facts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information.                                                                              

Further to Current Report No. 18/2023 of 15 May 2023, Current Report No. 23/2023 of 1 June 2023 and Current Report No. 41/2023 of 31 August 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 2 February 2024, the Company, acting on its own behalf and on behalf of the Grupa Azoty Group companies listed in the appendix to this report (the “Grupa Azoty Group”), signatories to the relevant financing agreements (“Financing Agreements”), entered into an agreement with 13 institutions providing financing to the Grupa Azoty Group (the “Financing Institutions”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A., Poland Branch, BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A., Frankfurt Branch, as well as with the European Bank for Reconstruction and Development and the European Investment Bank.

The agreement ensures the continued availability of credit limits under the Financing Agreements, prevents the Financing Institutions from taking actions to cancel or reduce the available limits of the Financing Agreements, and prevents the exercise of certain rights under the Financing Agreements in case of a breach or potential breach of the Financing Agreements occurring during the term of the agreement, which is effective until 27 February 2024.

This will facilitate the development of a long-term restructuring plan for the Grupa Azoty Group. The agreement may be subject to extension with the consent of the Financing Institutions.

At the same time, the Company has agreed to provide specific documents to the Financing Institutions, introduce agreed restrictions on dispositions related to planned investments, granting sureties and guarantees, and incurring financial liabilities, and to appoint a financial advisor for the Financing Institutions.

The Company meets all debt service and repayment obligations under the Financing Agreements in a timely manner, and the available limits ensure liquidity and secure financing for the Company to meet its own requirements and obligations to suppliers, ensuring the continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).                                                                     

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces the receipt, on 31 January 2024, of a notification from the Undersecretary of State at the Ministry of State Assets, an attorney-in-fact of the Minister of State Assets, dated 31 January 2024, of the appointment, pursuant to Art. 16.2 of the Company’s Articles of Association, of Krzysztof Andrzej Kołodziejczyk to the Company’s Supervisory Board.

A brief description of the newly appointed Supervisory Board Member’s educational background, qualifications, previously held positions and employment records are published as an appendix to this report.

The Management Board further announces that Krzysztof Andrzej Kołodziejczyk has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of governing bodies of any other competing legal entities.

The representation received by the Company includes a statement to the effect that the new Member of the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Sec. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 51/2023 of 9 November 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on 30 January 2024 the Management Board of the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) resolved to resume melamine production and to commence on 30 January 2024 the start-up of the Melamine III unit at the Subsidiary. The unit’s production volumes will be adjusted according to prevailing market conditions. The Melamine III unit’s maximum daily capacity of 90 tonnes accounts for approximately one-third of the rated capacity of all melamine units operated by the Subsidiary.

The Subsidiary announced the resumption of melamine production in Current Report No. 4/2024 of 30 January 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Grupa Azoty S.A. (the “Company”) will announce its 2023 full-year results and 2024 interim results as per the following schedule:

1. First and third quarter interim results:

• Q1 2024 complete consolidated report – May 22nd 2024
• Q3 2024 complete consolidated report – November 6th 2024

2. Half-year interim results:

• H1 2024 complete consolidated report – August 28th 2024

3. Full-year results:

• 2023 separate full-year report – April 10th 2024
• 2023 consolidated full-year report – April 10th 2024

The 2023 consolidated report on payments to governments will be released on April 10th 2024.

Furthermore, the Company announces that no separate quarterly results will be published by the Company, as permitted under Par. 62.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757) (the “Regulation”). The consolidated quarterly reports will incorporate quarterly condensed consolidated financial statements and quarterly financial information.

Also, the Company will not publish a separate (non-consolidated) half-year report, as permitted under Par. 62.3 of the Regulation.

Further, the Company will not publish separate or consolidated quarterly results for Q4 2023 and Q2 2024, as permitted under Par. 79.2 of the Regulation.

Legal basis: Par. 80.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 2/2024 and Current Report No. 3/2024 of 10 January 2024 and to Current Report No. 5/2024 of 18 January 2024, in connection with the Extraordinary General Meeting (the “EGM”) convened for 14 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, as a supplementary document concerning matters placed on the EGM’s agenda, a letter from the Management Board to Shareholders.

The Company will post the letter in the General Meeting section of its website.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 2/2024 and Current Report No. 3/2024 of 10 January 2024, in connection with the Extraordinary General Meeting (the “EGM”) convened for 14 February 2024, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, as supplementary documents concerning matters placed on the EGM’s agenda, the resolutions of the Company’s Supervisory Board of 18 January 2024 concerning:

• the Supervisory Board’s endorsement of the EGM draft resolution to adopt the agenda of the EGM,
• the Supervisory Board’s endorsement of the EGM draft resolution to amend the Articles of Association of the Company,
• the Supervisory Board’s endorsement of the EGM draft resolution to consent to the acquisition by the Company of all shares in Solarfarm Brzezinka Sp. z o.o.

The Company will post the resolutions in the General Meeting section of its website. 

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of 22 February 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in December 2023.

Actual output figures will be released in the consolidated annual report for 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the  “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Extraordinary General Meeting of the Company convened for 14 February 2024, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Section 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. of Tarnów (the “Company”) hereby convenes an Extraordinary General Meeting of the Company for 14 February 2024, at 10.00am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Extraordinary General Meeting attached as an appendix hereto.

Legal basis: Section 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated 29 March 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information                                                                                                          

Further to Current Report No. 34/2023 of 30 June 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that it has received a decision from the National Fund for Environmental Protection and Water Management, dated 9 January 2024, to the effect that the proceedings concerning potential state aid repayment by the Company were discontinued as groundless.

This means that the Company did satisfy the criteria and conditions for receiving state aid dedicated to supporting energy-intensive sectors in connection with sudden increases in natural gas and electricity prices, and therefore the PLN 52.3m aid granted to the Company (as announced by the Company in Current Report No. 9/2023 of 10 March 2023) was awarded legitimately and, as such, does not have to be repaid.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of 12 June 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Text of the report: The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Company has been granted public aid under the ‘Aid to energy-intensive industries related to natural gas and electricity prices in 2023’ programme administered by the National Fund for Environmental Protection and Water Management. The amount of the financial support granted to the Company is PLN 12m.

Financial support has also been granted to other companies of the Company’s group. The aggregate amount of support granted to the Group companies, i.e. Grupa Azoty S.A., Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. and Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A., is PLN 173m.

This amount will be included in the separate and consolidated financial results for the fourth quarter of 2023.

The funds were granted under the Act on the Rules of Implementation of Business Support Programmes in View of the Situation on the Energy Market in 2022–2024, dated September 29th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 15th 2023, Grupa Azoty Polyolefins S.A. (the “Subsidiary”) signed with ALIOR BANK S.A., BANK GOSPODARSTWA KRAJOWEGO, BANK OCHRONY ŚRODOWISKA S.A., BANK POLSKA KASA OPIEKI S.A., BNP PARIBAS BANK POLSKA S.A., EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT, HAITONG BANK POLSKA S.A., ICBC STANDARD BANK PLC, INDUSTRIAL AND COMMERCIAL BANK OF CHINA (EUROPE) S.A. (SPÓŁKA AKCYJNA) POLAND BRANCH, MBANK S.A., POWSZECHNA KASA OSZCZĘDNOŚCI BANK POLSKI S.A., POWSZECHNY ZAKŁAD UBEZPIECZEŃ S.A., POWSZECHNY ZAKŁAD UBEZPIECZEŃ NA ŻYCIE S.A., PZU FUNDUSZ INWESTYCYJNY ZAMKNIĘTY AKTYWÓW NIEPUBLICZNYCH BIS 2 and SANTANDER BANK POLSKA S.A. (the “Financial Institutions”) a stabilisation agreement (the “Stabilisation Agreement”) concerning the financing of the Polimery Police project (the “Project”), which is related to the existing agreement for the financing of the Project (the “Credit Facilities Agreement”), as previously announced by the Company in Current Report No. 23/2020 of May 31st 2020. Under the Stabilisation Agreement, the parties have agreed upon additional terms and conditions for the provision of debt financing by the Financial Institutions to support the implementation of the Project.

A key provision of the agreement involves the provision by the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Original Sponsors”) of a support loan to the Subsidiary as per the requests announced by the Company in Current Report No. 54/2023 of November 17th 2023 and Current Report No. 60/2023 of December 14th 2023. By the expiry date of the Stabilisation Agreement, the financial commitment of the Original Sponsors must increase, through the provision of additional tranches of the support loan, to EUR 105m, reaching the upper limit announced by the Company in Current Report No. 23/2020 of May 31st 2020.

The Stabilisation Agreement will remain in effect until February 28th 2024.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 22/2022 of July 20th 2022, Current Report No. 37/2022 of December 23rd 2022, and Current Report No. 48/2023 of October 19th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 15th 2023, the Company agreed with VSB Holding GmbH of Dresden, Germany, and Mr Janusz Franciszek Siemieniec (collectively the “Sellers”) on an updated revised term sheet (“Term Sheet”) for the purchase of 100% of shares in the share capital of Solarfarm Brzezinka sp. z o.o. of Wrocław (“Solarfarm”), the entity established to implement a minimum 270MWp solar PV power plant project located in Brzezinka and Syców, in the Province of Wrocław (the “Transaction”).

As per the updated Term Sheet, subject to adherence to the schedule provided in the Term Sheet and fulfilment of negotiation conditions, the Company will maintain exclusivity until March 31st 2024, for the execution of a preliminary conditional sale agreement regarding the prospective acquisition of 100% of shares in Solarfarm’s share capital. The other provisions of the Term Sheet of October 19th 2023, including the date of acquisition of 100% of shares in Solarfarm and the value of the potential future Transaction, remain unchanged.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 50/2023 of October 28th 2023 and Current Report No. 54/2023 of November 17th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 14th 2023 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) requested the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (“GA Police”) for another tranche of a support loan, in the amount of EUR 10m. The total value of all support loan tranches requested by the Subsidiary up until December 14th 2023 is EUR 55m.

The loan results from the joint and several commitment assumed by the Company and GA Police under the guarantee to provide a support loan (in the form of a subordinated loan), announced by the Company in Current Report No. 23/2020 of May 31st 2020, in connection with the Facilities Agreement of May 31st 2020 concluded to finance the Polimery Police project (the “Facilities Agreement”).

The Company explains that the reason which prompted the Subsidiary to request to be provided with the loan in view of insufficient funding to complete the Polimery Police project under the Facilities Agreement is the prolonged completion time of the Polimery Police project due to a delay on the part of Hyundai Engineering Co., Ltd., the General Contractor, as announced by the Company in Current Report No. 40/2023 of August 29th 2023, Current Report No. 52/2023 of November 13th 2023, and Current Report No. 56/2023 of November 24th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in November 2023.

Actual output figures will be released in the consolidated annual report for 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 30th 2023 its subsidiary, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), executed amendments to the contract for the purchase of propane with TOTSA Total Energies Trading S.A. of Geneva, Switzerland, which had been reported on by the Company in Current Report No. 15/2023 of April 27th 2023.

The amendments are aimed at aligning the contractual terms of propane deliveries with the Subsidiary’s needs, reflecting the current timeline of the Polimery Police project, whose duration is expected to be extended (for details, see Current Report No. 56/2023 of August 29th 2023). Under the amendments, the propane deliveries schedule was revised, additional propane deliveries were contracted for 2025, and the contract term was extended until September 1st 2025.

The additional value of the deliveries to be made under the amendments to the contract is estimated at approximately USD 42m.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 27th 2023 it received a notice of resignation from Ms Marzena Małek from her position as Member of the Company’s Supervisory Board.

In the notice, Ms Marzena Malek did not give a reason for her resignation.

Legal basis: Par. 5.4) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 52/2023 of November 13th 2023, Current Report No. 40/2023 of August 29th 2023 and Current Report No. 3/2022 of January 28th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 24th 2023, the Supervisory Board of the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”) passed a resolution to approve an updated schedule for the Polimery Police project. The updated project schedule provides for a 72-hour full-load run in the first quarter of 2024 and the start of commercial operation in the first half of 2024.

Delays reported by Hyundai Engineering Co., Ltd, the General Contractor on the Polimery Police project, have led to the schedule update and extension of the project completion date. The Subsidiary is thoroughly analysing and verifying the reported delays to assess their validity in light of the contract for the engineering, procurement and construction of the Polimery Police project, dated May 11th 2019 (the “EPC Contract”). This assessment is being conducted in line with the procedure outlined in the EPC Contract and other agreements between the Subsidiary and the General Contractor, considering all relevant facts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 27/2023 of June 6th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that, on November 20th 2023, following an analysis of the transaction’s impact on the Company’s group, the value-building concept developed by an independent consultant, and the recommendation of the Project Steering Committee, the Management Board passed a resolution to initiate discussions with Orlen S.A. to cease any further actions related to the potential acquisition of Grupa Azoty Zakłady Azotowe Puławy S.A. by Orlen S.A. The resolution of the Management Board became effective upon adoption.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 50/2023 of October 28th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 17th 2023 Grupa Azoty Polyolefins S.A. (the “Subsidiary”) requested the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (“GA Police”) for a support loan of EUR 45m.

The loan results from the joint and several commitment assumed by the Company and GA Police under the guarantee to provide a support loan (in the form of a subordinated loan) of up to EUR 105m (as announced by the Company in Current Report No. 23/2020 of May 31st 2020) in connection with the Facilities Agreement of May 31st 2020 concluded to finance the Polimery Police project (the “Facilities Agreement”). The Company points out that this request for a supporting loan does not eliminate the possibility of the Subsidiary requesting further loan tranches until the maximum limit of EUR 105m is reached.

The Company explains that the reason which prompted the Subsidiary to request to be provided with the loan in view of insufficient funding to complete the Polimery Police project under the Facilities Agreement is the prolonged completion time of the Polimery Police project due to a delay on the part of Hyundai Engineering Co., Ltd., the General Contractor, as announced by the Company in Current Report No. 40/2023 of August 29th 2023 and Current Report No. 52/2023 of November 13th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in October 2023.

Actual output figures will be released in the consolidated annual report for 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 40/2023 of August 29th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 13th 2023, the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”) received a letter from Hyundai Engineering Co., Ltd, which is the General Contractor for the Polimery Police project, notifying it of initiation of the Change Proposal procedure under the turnkey engineering, procurement and construction contract for the Polimery Police project of May 11th 2019 (the “EPC Contract”). The Change Proposal submitted by the General Contractor under the EPC Contract concerns an extension of the project's completion date by 166 days (counted from August 31st 2023). The Change Proposal does not concern the EPC Contract price payable to the General Contractor. According to the General Contractor, the reason for submitting the Change Proposal was the occurrence of certain events constituting force majeure.

The Change Proposal will be thoroughly reviewed and verified in terms of its validity under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the General Contractor, as well as in the light of relevant facts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 45/2023 of Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”), dated November 9th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that it has been notified by the Subsidiary of the stoppage, due to technical problems, of the Melamine II unit for repair. Consequently, following earlier output reductions in line with market demand, no melamine is currently being produced at the Subsidiary. Any pending orders will be fulfilled using existing stock. The Subsidiary and the Company will provide updates on the resumption of melamine production in subsequent current reports.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014,  No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 23/2020 of May 31st 2020 and Current Report No. 40/2023 of August 29th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on October 27th 2023 it was notified by Grupa Azoty Polyolefins S.A. (the “Subsidiary”) that the Subsidiary might call on the Company and Grupa Azoty Zakłady Chemiczne Police S.A. (“GA Police”) for the provision of a subordinated loan. The potential loan would result from the joint and several commitment assumed by the Company and GA Police under the guarantee to provide a support loan (in the form of a subordinated loan) of up to EUR 105m (as announced by the Company in Current Report No. 23/2020 of May 31st 2020) in connection with the Facilities Agreement of May 31st 2020 concluded to finance the Polimery Police project (the “Facilities Agreement”). The maximum amount of the potential loan that might be provided to complete the Polimery Police project is EUR 105m, but the Subsidiary has provisionally estimated the amount it would need in 2023 at approximately EUR 45-55m. However, the Subsidiary noted that these estimates were based on assumptions that could be subject to further revisions or updates, which would affect the actual amount of the potential support loan.

At the same time, the Company explains that the reason which prompted the Subsidiary to request the provision of the potential loan is the prolonged completion time of the Polimery Police project due to a delay on the part of the General Contractor, as announced by the Company in Current Report No. 40/2023 of August 29th 2023, and the resulting risk that funds advanced under the Facilities Agreement could be insufficient to finance the completion of the Polimery Police project.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the third quarter and the first nine months of 2023.

Discussion of the results for the third quarter of 2023

For the three months ended September 30th 2023, the Grupa Azoty Group reported consolidated revenue of PLN 3,075m, EBITDA of PLN -348m, and an EBITDA margin of -11.3%.

The period saw improved demand, notably in the Agro Segment and, to a degree, in the Chemicals Segment, especially relative to the prior quarter. This led to an increase in production volumes and a decrease in fertilizer inventories. However, most Grupa Azoty products were offered at prices that were significantly lower than those from the previous year, i.e. by an average of 52%. At the same time, the costs of energy utilities, such as electricity and coal, rose year on year. While considerably higher than in other markets, natural gas prices in Europe remained stable for most of the period. This stabilisation, which contrasted the volatility witnessed in the previous year, was primarily attributable to a record surge in renewable energy production, abundant gas stocks in European storage facilities, and above-average temperatures. The decline in product prices in the third quarter of 2023 was not accompanied by an offsetting drop in feedstock prices, resulting in shrinking margins.

Main drivers of the results for the third quarter of 2023 in the key segments:

Agro

The third quarter is traditionally a period of intense fieldwork in Poland, leading to a seasonal drop in demand for fertilizer products. However, the three months to September 30th 2023 saw a rise in demand for Grupa Azoty products, mainly attributable to farmers restocking their supplies and purchasing fertilizers for the upcoming autumn application season. The total sales volume of fertilizers was up 8% year on year, resulting in a 6% output increase. The segment’s performance was primarily driven by improved demand for nitrogen and compound fertilizers and the market reverting to its usual seasonal demand-price dynamics.

The tariff suspension in the first half of 2023 (from December 2022) was a major factor supporting the expansion in Europe of imports from regions with significant energy, environmental and labour cost advantages. The prices of natural gas, which is vital for fertilizer production, were at their lowest for the year during the third quarter, increasing only towards the period’s end. It is noteworthy that gas prices in Europe remain even several times higher than in other markets, as indicated by benchmarks such as Henry Hub in the US.

In the third quarter of 2023, the Agro Segment’s EBITDA margin stood at -7.6%.

Chemicals

For the Chemicals Segment, the three months to September 30th 2023 were marked by subdued demand due to adverse global macroeconomic conditions, high inventories, and an influx of cheaper imports to Europe. Consequently, the segment recorded an 18% year-on-year decline but a 14% quarter-on-quarter increase in sales volume. Notably, sales of technical-grade sulfur and urea rose by almost 50% relative to the previous quarter. In the three months to September 30th 2023, product prices fell significantly year on year across the Group’s geographies, with the largest decreases (over 60%) observed for NOXy, melamine, and technical grade urea. Prices for the segment’s key feedstocks, including gas, propylene and ilmenite, also declined year on year, reflecting the prevailing market trends.

The segment’s EBITDA margin for the third quarter of 2023 was negative at -28.6%.

Plastics

In the three months to September 30th 2023, the Plastics Segment posted a 20% year-on-year decline in polyamide 6 sales volume, largely attributable to reduced demand from all major consumers, including engineering plastics, carpet fibres, and packaging film producers. This drop in demand placed strong downward pressure on the prices of European plastics, which, to a certain extent, helped curtail imports from highly cost-competitive markets, especially in Asia. Benzene prices were 33% lower than a year earlier.

The segment’s EBITDA margin for the third quarter of 2023 was negative at -34.0%.

Estimated results for the first nine months of 2023

In the nine months ended September 30th 2023, the Grupa Azoty Group generated consolidated revenue of PLN 10,462m, EBITDA of PLN -1,357m, and an EBITDA margin of -13.0%.

The amounts presented above are estimates and may be subject to change. The final results will be presented in the consolidated report for the third quarter and the nine months ended September 30th 2023, to be issued on November 8th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 22/2022 of July 20th 2022 and Current Report No. 37/2022 of December 23rd 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on October 19th 2023 the Company agreed with VSB Holding GmbH of Dresden, Germany, and Mr Janusz Franciszek Siemieniec (collectively the “Sellers”) on a revised term sheet for the purchase of 100% of shares in the share capital of Solarfarm Brzezinka sp. z o.o. of Wrocław (“Solarfarm”), the entity established to implement a minimum 270 MWp solar PV power plant project located in Brzezinka and Syców, in the Province of Wrocław (the “Transaction”).

The turnkey construction of the power plant is to materialise under an EPC contract concluded between the Company and a general contractor, to be selected through a competitive tender process once the Transaction is finalised.

Pursuant to the Term Sheet, the Transaction is to be carried out through the conclusion, by mid-December 2023, of a preliminary conditional agreement for the future acquisition of 100% of shares in Solarfarm, and subsequent acquisition by the Company or another company of its group, by the end of the third quarter of 2024, of the Solarfarm shares under a share purchase agreement, provided that the project achieves a ‘ready to build’ (RTB) status, as substantiated by a due diligence study conducted by the Company, and provided that satisfactory general contractor tenders to build the solar PV farm under an EPC contract are received.

Execution of the preliminary conditional share purchase agreement is subject to approval from the General Meeting.

The acquisition value of Solarfarm shares will amount to EUR 37.8m, assuming that the power plant achieves a capacity of 270 MWp, excluding expenses associated with the performance of the future EPC contract. If the capacity of the 270 MWp power plant is expanded to 300 MWp within five years of its launch, the acquisition value of the shares will be increased by EUR 2.1m.

The execution of the Term Sheet does not give rise to any obligation to enter into the contemplated Transaction, or any share purchase agreement, and is not binding on the parties. However, the parties undertook to negotiate the share purchase and the contemplated transaction in good faith, in accordance with the Term Sheet.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in September 2023.

Actual output figures will be released in the consolidated report for the third quarter of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 42/2023 of September 5th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) hereby communicates the estimated cost and time frame for removing the plant failure that had occurred at the Company’s subsidiary Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Subsidiary”).

The Management Board announces that the production of nitric acid at the Subsidiary is expected to be resumed in the 39th week of 2023, followed by the production of mineral fertilizers at minimum loads. The restart of other units and ramp-up of production back to full capacity will continue until around mid-October 2023, when repair work on the ammonia plant’s boiler system is scheduled for completion.

The financial impact of the plant failure at the operating level has been provisionally estimated at about PLN 20m, comprising lost profits on sales of products (fertilizers, nitric acid, UAN, urea and OXO alcohols) that would have likely been earned had the units operated at normal rates. The cost of repairing the ammonia plant is estimated at approximately PLN 1.4m.

The amounts presented above are estimates and may be subject to change.

Legal basis: Article 17(1) of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the second quarter and the first half of 2023.

Discussion of the results for the second quarter of 2023

In the three months ended June 30th 2023, the Grupa Azoty Group generated consolidated revenue of PLN 3,491m, EBITDA of PLN -608m, and an EBITDA margin of -17.4%.

The second quarter was a period unfavourable macroeconomic conditions leading to low demand in the markets for the Group’s products and in the downstream markets. Low demand led to additional downward pressures on product prices and a decline in sales volumes and, in consequence, to curtailed production in all key business segments of the Group. The reported quarter was also a period of relatively high costs of raw materials and energy carriers, adversely impacting the margins.

Natural gas prices, while fluctuating, remained in a downward trend. The pressure on prices was supported by elevated inventory levels, increased power output from renewable energy sources, continued strong LNG supplies to Europe, as well as favourable weather conditions and a drop in coal prices.

The results for the second quarter of 2023 were bolstered by the sale of CO₂ emission allowances (EUAs) purchased on the market in previous periods by the subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. The sale involved excess EUAs resulting from lower production levels at the Subsidiary and remaining after it had surrendered EUAs matching its actual emissions for 2022. The total positive effect of these transactions on the Group’s results in the period under analysis amounted to PLN 289m.

Main drivers of the results for the second quarter of 2023 in the key segments:

Agro

In the three months to June 30th 2023, there was a 24% year-on-year decrease in total fertilizer sales by volume due to a relatively low demand, with compound fertilizers experiencing an even steeper sales decline of 49%. Unfavourable conditions prevailed in Polish agriculture, with grain prices following a downward trend in the domestic market. The European Union’s suspension of tariffs on urea and ammonia remained in effect until June 17th 2023. There was an increase in imports of fertilizers into the European and domestic markets. Prices of natural gas, a key feedstock for fertilizer production, were in a downtrend. During the second quarter, TTF spot prices were EUR 35/MWh, marking a 63% year-on-year decrease. This, coupled with factors in the agricultural market and the supply-demand dynamics within the fertilizer market, led to diminished demand and exerted downward pressure on fertilizer prices.

Due to weak demand, the Grupa Azoty Group aligned production levels at its own facilities with the prevailing supply and demand conditions in the European market during the quarter under review. Total fertilizer production in the three months to June 30th 2023 was 43% lower year on year. Production of compound fertilizers fell 49% year on year, and the quarterly results were adversely affected by a year-on-year rise in costs of energy carriers.

The Agro Segment posted an EBITDA margin of -28.8% for the second quarter of 2023.

Chemicals

In the Chemicals Segment, the second quarter of 2023 saw reduced purchasing activity in the segment’s key economic sectors, namely construction and furniture manufacturing.

During the period, all product prices experienced year-on-year declines, with the largest decreases recorded for sulfur, melamine, and technical grade urea. Also the sales volumes of the segment’s products declined across the board, except for sulfur. Prices of key raw materials for OXO alcohols and plasticizers production (propylene and terephthalic acid) dropped year on year, whereas the unit cost of ilmenite, which is used in the production of titanium white, saw an increase.

The segment posted an EBITDA margin of -43.3% for the three months ended June 30th 2023.

Plastics

The Plastics Segment saw a decline in polyamide 6 sales volumes in the second quarter of 2023, which were down by one-third year on year as a result of reduced internal demand in Europe and limited export opportunities. Prices of polyamide 6 produced by the Grupa Azoty Group were under continuous downward pressure. Prices of raw materials (benzene and phenol) were lower year on year.

European producers faced competitive imports of cheaper products in the PA6 chain, particularly from Asia. Increased production in the automotive sector and rising new car sales in the EU did not translate into higher orders, let alone an overall surge in demand for polyamide 6.

The segment posted an EBITDA margin of -47.7% for the second quarter of 2023.

Estimated results for the first half of 2023

In the six months ended June 30th 2023, the Grupa Azoty Group generated consolidated revenue of PLN 7,386m, EBITDA of PLN -1,009m, and an EBITDA margin of -13.7%.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the six months ended June 30th 2023, scheduled for issue on September 27th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on September 14th 2023 its subsidiary, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), executed Amendment 1 and Amendment 2 to the contract for the purchase of propane with Trafigura PTE Ltd. of Singapore, as announced by the Company in Current Report No. 36/2022 of December 16th 2022.

The amendments are aimed at aligning the contract with the Subsidiary’s current needs, reflecting the progress made on the Polimery Police project, whose duration is expected to be extended (for details, see Current Report No. 40/2023 of August 29th 2023). Under the amendments, the propane deliveries schedule has been revised, additional propane deliveries have been contracted, and the contract term has been extended until December 12th 2025.

The value of the additional deliveries is estimated at approximately USD 80m.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in August 2023.

Actual output figures will be released in the consolidated report for the third quarter of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. has received information from the Company’s subsidiary Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Subsidiary”) regarding a failure at the ammonia plant. As a result of the failure, production processes at the Subsidiary’s key units, which include the production of fertilizers, nitric acid, UAN, urea, and OXO alcohols, have been temporarily suspended.
At present, Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. is unable to provide a definitive timeline for resolving the technical issues and restoring production to its pre-failure levels. As of the date of this report, the estimated impact of the failure remains unknown.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 23/2023 of June 1st 2023 and Current Report No. 18/2023 of May 15th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on August 31st 2023 the Company, together with its subsidiary Grupa Azoty Zakłady Chemiczne Police S.A. and also with respect to the other companies of the Grupa Azoty Group (the “Grupa Azoty Group”) that are parties to the financing agreements, signed Waiver and Amendment Letters (the “Waiver Letters”) with the insititutions providing financing to the Grupa Azoty Group (the “Financing Parties”): Powszechna Kasa Oszczędności Bank Polski S.A., Bank Gospodarstwa Krajowego, ING Bank Śląski S.A., Santander Bank Polska S.A., Caixabank S.A. (Spółka Akcyjna) Oddział w Polsce (Spółka Akcyjna), BNP Paribas Faktoring sp. z o.o., ING Commercial Finance Polska S.A., Pekao Faktoring sp. z o.o., BNP Paribas Bank Polska S.A., Santander Factoring sp. z o.o. and Banco Santander S.A., as well as with the European Bank for Reconstruction and Development and the European Investment Bank, under which these institutions agreed to waive selected covenants under the Grupa Azoty Group’s financing agreements, including the net debt/EBITDA covenant tested as at June 30th 2023.

At the same time, the Company’s Management Board announces that, in accordance with the requirements of the Waiver Letters, on August 31st 2023 additional security was created with respect to liabilities under the Grupa Azoty Group’s financing agreements pursuant to a guarantee agreement entered into by the Company’s subsidiary Compo Expert Holding GmbH, acting as the Guarantor, with the Financing Parties.

The Guarantor’s potential liability towards the Financing Parties is limited by German law to the value of its net assets.

The terms of the Waiver Letters do not differ from standard terms used in such agreements.

In addition, the Company announces that potential further waiver of selected covenants under the Grupa Azoty Group’s financing agreements, including waiver of the net debt/EBITDA covenant as at subsequent testing dates until December 2024, is subject to continued negotiations with the insititutions providing financing to the Grupa Azoty Group.

The Group fulfils all debt service and repayment obligations under the financing agreement on an ongoing basis, and the limits available under the financing agreements ensure liquidity and secure financing for the Group and its suppliers as well as continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 3/2022 of January 28th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on August 29th 2023, the Company’s subsidiary Grupa Azoty Polyolefins S.A. (the “Subsidiary”) received a letter from Hyundai Engineering Co., Ltd, which is the General Contractor on the Polimery Police project, informing the employer that the duration of the project will be extended by a period of two to three months.

The General Contractor cited unforeseen equipment problems during the commissioning phase of certain units as the reason for the delay in completing the project work.   

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 5/2023 of January 20th 2023 and Current Report No. 16/2023 of May 12th 2023, the Management Board of Grupa Azoty S.A. announces that the release date for the consolidated H1 2023 report has been changed from August 30th 2023 to September 27th 2023.

The release date for the interim report for the third quarter of 2023 remains unchanged, with the updated release dates for interim reports in 2023 provided below:

1. First and third quarter interim reports:

• Q3 2023 complete consolidated report – November 8th 2023.

2. Half-year interim reports:

• H1 2023 complete consolidated report – September 27th 2023.

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in July 2023.

Actual output figures will be released in the consolidated report for the third quarter of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 70.1. of the Public Offering Act

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it has received a notification from Mr Radosław Leszek Kwaśnicki, dated July 17th 2023, on acquiring control over shares in a public company and exceeding the threshold of 15% of the total number of votes in the Company (the “Notification”). The Notification has been made by Mr Radosław Leszek Kwaśnicki in the performance of the obligation set forth in Art. 69.1.1 in conjunction with Article 69a.1 of the Public Offering Act and Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (the “Public Offering Act”). According to the Notification:

I. Date and type of event causing the shareholding change to which the notification pertains

The Notification has been given in connection with the acquisition by Mr Radosław Leszek Kwaśnicki of control over, including voting rights attached to, the Company shares, following his appointment:

1. Under Decision No. DNP-VII.491.3.2023 of the Minister of Development and Technology dated July 11th 2023 – as the administrator of Norica Holding Sarl with its registered office at 121 Avenue de la Fraincerie L-1511, Luxembourg (“Norica”), with respect to its shareholding in the Company;
2. Under Decision No. DNP-VII.491.4.2023 of the Minister of Development and Technology dated July 11th 2023 – as the administrator of Opansa Enterprises Limited with its registered office at Kastros 2, Nicosia, 1087, Cyprus (“Opansa”), with respect to its shareholding in the Company;
3. Under Decision No. DNP-VII.491.5.2023 of the Minister of Development and Technology dated July 11th 2023 – as the administrator of Rainbee Holdings Limited with its registered office at Kastros 2, Nicosia, 1087, Cyprus, entered in the Cyprus Companies Registry under no. HE 309661 (“Rainbee”), with respect to its shareholding in the Company.

As the administrator of Norica, Opansa and Rainbee (collectively, the “Companies under Administration”), under Art. 6a.11.2 and Art. 6a.11.3 in conjunction with Art. 6b.3 of the Act on Special Measures to Prevent Supporting Aggression against Ukraine and Protect the National Security of April 13th 2022 (the “Sanctions Act”), Mr Radosław Leszek Kwaśnicki (the “Administrator”) has the right to pass resolutions and make decisions on all matters relating to the Company shares held by the Companies under Administration which fall within the remit of the governing bodies of each Company under Administration, including the right to vote the Company shares held by them.

The Companies under Administration hold a total of 19,657,350 shares in the Company (i) representing approximately 19.82% of the Company’s share capital and 19,657,350 voting rights at the Company’s General Meeting, and (ii) accounting for approximately 19.82% of the total voting rights in the Company.

The acquisition of control over the aforementioned Company shares by the Administrator effectively took place on July 12th 2023 (the “Control Acquisition Date”). According to the Sanctions Act, a decision to appoint an administrator is immediately enforceable and takes effect on the day following the day on which the decision is published in the Public Information Bulletin on the website of the Minister of Development and Technology (Art. 6b.2 in conjunction with Art. 6a.2 and Art. 4.3 of the Sanctions Act). All of the decisions referred to in items 1–3 above were published in the Public Information Bulletin on July 11th 2023 and are enforceable as of July 12th 2023.

II. The number of shares held before the change in shareholding and their percentage share in the Company’s share capital, and the number of voting rights attached to those shares and their percentage share in total voting rights

Prior to the Control Acquisition Date, the Administrator held 0 shares in the Company, representing 0% of the Company’s share capital, 0 voting rights at the Company’s General Meeting and 0% of the total voting rights in the Company.

III. The number of shares currently held and their percentage share in the Company’s share capital, and the number of voting right attached to those shares and their percentage share in total voting rights

As of the Control Acquisition Date, the Administrator holds:

1. Directly: 0 shares in the Company, representing 0% of the Company’s share capital, 0 voting rights at the Company’s General Meeting and 0% of the total voting rights in the Company;
2. Indirectly: 19,657,350 shares in the Company, representing approximately 19.82% of the Company’s share capital and 19,657,350 voting rights at the Company’s General Meeting, accounting for approximately 19.82% of the total voting rights in the Company, including:
   1. Through Norica, the Administrator holds 406,998 shares in the Company, representing 0.41% of the Company’s share capital and 406,998 voting rights at the Company’s General Meeting, accounting for 0.41% of the total voting rights in the Company;Through Opansa, the Administrator holds 9,430,000 shares in the Company, representing 9.51% of the Company’s share capital and 9,430,000 voting rights at the Company’s General Meeting, accounting for 9.51% of the total voting rights in the Company;Through Rainbee, the Administrator holds 9,820,352 shares in the Company, representing 9.90% of the Company’s share capital and 9,820,352 voting rights at the Company’s General Meeting, accounting for 9.90% of the total voting rights in the Company.

IV. Subsidiaries of the shareholder making the notification, holding shares in the Company

The Companies under Administration, i.e., Norica, Opansa and Rainbee, are the only subsidiaries of the Administrator (controlled by the Administrator) that hold shares in the Company.

V. Persons referred to in Art. 87.1.3 of the Public Offering Act

There are no persons referred to in Art. 87.1.3 of the Public Offering Act.

VI. The number of voting rights attached to the shares, calculated in accordance with Art. 69b.2 of the Public Offering Act, which the shareholder is entitled or obliged to acquire as a holder of the financial instruments referred to in Art. 69b.1.1 of the Public Offering Act and the financial instruments referred to in Art. 69b.1.2 of the Public Offering Act which are not subject to cash settlement only; the type or name of those financial instruments, their expiry date and the date on which (or the time limit by which) the shares will or may be acquired

The Administrator does not hold any financial instruments referred to in Article 69b.1 of the Public Offering Act.

VII. The number of voting rights attached to the shares, calculated in accordance with Article 69b.3 of the Public Offering Act, to which the financial instruments referred to in Art. 69b.1.2 of the Public Offering Act relate directly or indirectly; the type or name of those financial instruments and their expiry date

The Administrator does not hold any financial instruments referred to in Article 69b.1 of the Public Offering Act and therefore does not hold any voting rights attached to shares, calculated in accordance with Art. 69b.3 of the Public Offering Act.

VIII. The total number of voting rights specified on the basis of items III, VI and VII of this information from the Company and its percentage share in total voting rights

As of the Control Acquisition Date, the total number of voting rights held by the Administrator is as follows:

1. Directly: 0 votes at the Company’s General Meeting, representing 0% of the total number of votes in the Company;
2. Indirectly: 19,657,350 votes at the Company’s General Meeting, representing 19.82% of the total voting rights in the Company.

Legal basis: Art. 70.1 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2022, item 2554, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Acting pursuant to Article 428.5 of the Commercial Companies Code, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached to this Current Report, its answers to the questions asked by a shareholder under Article 428.1 of the Commercial Companies Code during the Annual General Meeting of June 29th 2023.

Legal basis: Par. 19.1.12 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in June 2023.

Actual output figures will be released in the consolidated report for the first half of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it has received a letter from the National Fund for Environmental Protection and Water Management (“NFOŚiGW”), dated June 30th 2023, whereby the latter contends that Grupa Azoty S.A. failed to satisfy the criteria or conditions for receiving state aid dedicated to supporting energy-intensive sectors in connection with sudden increases in natural gas and electricity prices, and, therefore PLN 52.3m in aid granted to the Company (which the Company announced in Current Report No. 9/2023 of March 10th 2023) was awarded illegitimately and, as such, must be repaid by the Company with interest.

The claims asserted by NFOŚiGW are based on a different interpretation of the codes of the Polish Classification of Activities which the Company registered with the National Court Register and to which the Company’s revenue is assigned.

In the Company’s opinion, the Company’s business activities, i.e. manufacture of basic chemicals, fertilisers and nitrogen compounds, plastics and synthetic rubber in primary forms, clearly satisfy the prerequisites for receiving financial support under the state aid programme dedicated to supporting energy-intensive sectors in connection with sudden increases in natural gas and electricity price Accordingly, the Company is strongly convinced that NFOŚiGW’s claims are without merit.

The Company intends to request NFOŚiGW for clarification of its assertions and seek any remedy available under law to retain the aid it has received.

Legal basis: Article 17(1) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on June 30th 2023 the Company’s subsidiary Grupa Azoty Zakłady Chemiczne Police S.A. (the “Subsidiary”, “GA Police”) completed the sale of a total of 457,373 carbon allowances (“EUAs”) purchased on the market in previous periods. The sale involved excess EUAs resulting from lower production levels at the Subsidiary and remaining after it had surrendered EUAs matching its actual emissions for 2022.

The effect of the sale on financial results of GA Polie was reported by the Subsidiary in Current Report No. 25/2023 of June 30th 2023.

The sale of EUAs has had a positive effect on the Grupa Azoty Group’s liquidity position, leading to a reduction of its consolidated net debt. Proceeds from the sale of EUAs amounted to EUR 39.3m (PLN 175.2m). The income received by the Subsidiary from the sale of EUAs will increase the consolidated EBIT and EBITDA for the second quarter and first half of 2023 by PLN 91.0m.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Annual General Meeting held on June 29th 2023, specifying the number of voting rights conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at the Annual General Meeting and in total voting rights.

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2021, item 1983, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Annual General Meeting (“AGM”) on June 29th 2023, together with the results of voting.

The documents voted on by the Annual General Meeting are available on the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia. They have also been published with the Company’s separate and consolidated annual report for 2022 and attached to Current Report No. 26/2023 of June 2nd 2023.

In connection with the use of a computer system for voting and counting the votes, the Annual General Meeting decided not to appoint a Ballot Counting Committee.

The Annual General Meeting decided not to consider item 5 of the agenda ‘Resolution to abolish the secrecy of voting on the election of committees to be appointed by the Annual General Meeting’.

The Management Board also publishes, attached to this resolution, a draft resolution to convene an Extraordinary General Meeting of the Company which was proposed by a shareholder during the AGM. The resolution was not carried by the AGM.

Objections to Resolutions No. 4, 6, 7, 8 and 10–28 were raised by shareholders for the record in the minutes.

Legal basis: Par. 19.1.6–9 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Text of the report:

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on June 28th 2023 the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”, “GA Puławy”) completed a sale process involving a total of 938,478 carbon emission allowances (“EUAs”) purchased on the market in earlier periods. The sale involved excess EUAs resulting from lower production levels at the Subsidiary and remaining after it had surrendered EUAs matching its actual emissions for 2022.

The effect of the sale on financial results of GA Puławy was reported by the Subsidiary in Current Report No. 35/2023 of June 28th 2023.

The sale of EUAs has had a positive effect on the Grupa Azoty Group’s liquidity position, leading to a reduction of its consolidated net debt.

Proceeds from the sale of EUAs amounted to EUR 80.8m (PLN 360.2m). The income received by the Subsidiary from the sale of EUAs will increase the Grupa Azoty Group’s consolidated EBIT and EBITDA for Q2 and H1 2023 by PLN 182.2m.

Legal basis: Article 17(1) of the Regulation of the European Parliament and of the Council (EU) No. 596/2014
of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”, the “Buyer”) announces that on June 20th 2023 the Company and its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A., Grupa Azoty Zakłady Fosforowe Gdańsk Sp. z o.o. (jointly referred to as “Buyers” and separately as a “Buyer”) and PKN Orlen S.A. (“PKN Orlen”, the “Seller”), executed an annex to the framework gas supply agreement and new bilateral Individual Contracts. The total estimated value of the contracts for the entire Group over their four-year term will be approximately PLN 18bn, VAT exclusive.

The Framework Agreement, executed on April 13th 2016 for an indefinite term, sets out a uniform procedure for all Buyers for concluding and terminating Individual Contracts, the processes for placing orders, making payments and withholding and reducing supplies, renegotiation clauses, and the rules for joint settlement of deliveries. Its provisions, as amended by the annex, apply to deliveries made as of July 1st 2023.

The new Individual Contracts have been concluded for a four-year period of deliveries, starting October 1st 2023, under the 3+1 formula, i.e., after three years of the contract term, the fourth year is optional and no contractual penalties are charged for termination of the contract after three years provided that a termination notice is given by September 30th 2025.

An Individual Contract is an implementing agreement to the Framework Agreement, concluded for a definite period in the form of a comprehensive agreement (applies to sale at a physical point), specifying quantities, schedule, payment terms, price formulas based on exchange indices and detailed commercial parameters for the supply of gaseous fuel to a Buyer.

The terms of the Individual Contracts do not differ from standard terms used in contracts of this type.

The annex to the Framework Agreement, together with the new Individual Contracts, will secure, during their term, at least 90% of the total gas demand of the Buyers from the Grupa Azoty Group.

In addition, further to Current Report No. 23/2016 of April 13th 2016 on the execution of an agreement with Polskie Górnictwo Naftowe i Gazownictwo S.A. (currently PKN Orlen S.A.), No. 22/2017 of June 21st 2017 on the execution of Individual Contracts with PKN Orlen, and No. 30/2019 of May 23rd 2019 and No. 20/2022 of July 7th 2022 on their extension, the Company announces that on July 20th 2023 the Company and its subsidiaries: Grupa Azoty Zaklady Azotowe Puławy S.A., Grupa Azoty Zaklady Chemiczne Police S.A., Grupa Azoty Zaklady Azotowe Kędzierzyn S.A., Grupa Azoty Kopalnie i Zaklady Chemiczne Siarki Siarkopol S.A., executed annexes to the Individual Contracts currently in force, under which the commercial terms of gas deliveries by the Seller in the period from July 1st 2023 to September 30th 2023 will be the same as those defined in the new Individual Contracts applicable from October 1st 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in May 2023.

Actual output figures will be released in the consolidated report for the first half of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that following an expression of interest by PKN ORLEN S.A., a non-disclosure document setting out a procedure for sharing information between the parties was signed by the Company, PKN ORLEN S.A. and Grupa Azoty Zakłady Azotowe Puławy S.A. (“GA Puławy”) on June 6th 2023 in connection with the parties’ intention to enter into discussions regarding a potential acquisition by PKN ORLEN S.A. (the “Transaction”) of GA Puławy, to be preceded by due diligence.

The non-disclosure document defines the rules for sharing information during the due diligence review of GA Puławy. It does not constitute a commitment by either party to pursue the Transaction.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Annual General Meeting of the Company convened for June 29th 2023, relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes an Annual General Meeting of the Company for June 29th 2023, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Par. 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 19/2023 of May 17th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the Management Board of the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) has decided to launch, on June 2nd 2023, the process to restart anther melamine unit – Melamine II. The Melamine II unit’s daily capacity of 90 tonnes accounts for approximately one-third of the rated capacity of all melamine units operated by the Subsidiary. The unit’s production volumes will be adjusted according to current supply and demand.

The Subsidiary announced the resumption of melamine production in Current Report No. 29/2023 of June 1st 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

In view of the potential risk of breaching the net debt/EBITDA ratio at the end of the first half of 2023 by exceeding the maximum levels allowed under the financing agreements of the Grupa Azoty Group (the “Group”), as announced in Current Report No. 18/2023 of May 15th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) has entered into talks with the financial institutions on this issue.

At the same time, on June 1st 2023 the Company’s Management Board submitted a request with the institutions providing financing to the Group, for, among other things, a waiver of selected terms of the Group’s financing agreements, including the terms concerning the net debt/EBITDA ratio, for the period from the end of June 2023 to the end of December 2024.

The Group fulfils all debt service and repayment obligations under the financing agreement on an ongoing basis, and the limits available under the financing agreements ensure liquidity and secure financing for the Group and its suppliers as well as continuity of operations.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 20/2023 of May 22nd 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on May 29th 2023 the Company’s Supervisory Board issued a positive assessment of the proposal of the Company’s Management Board to allocate the Company’s net profit for the financial year ended December 31st 2022, of PLN 356,059,831.38, to the Company’s statutory reserve funds, and issued a positive opinion on the Management Board’s recommendation to the Annual General Meeting to allocate the entire net profit of the Company for the financial year 2022 to the Company’s statutory reserve funds.

A final decision on the allocation of the 2022 profit will be made by the Annual General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on May 24th 2023 Grupa Azoty Polyolefins S.A., member of the Company’s Group (the “Subsidiary”), received from Hyundai Engineering Co., Ltd. (the “Contractor”), the General Contractor under the contract for turnkey execution of the Polimery Police project of May 11th 2019 whose conclusion was announced by the Company in Current Report No. 28/2019 of May 11th 2019, as amended, including under annexes announced by the Company in Current Report No. 45/2020 of October 9th 2020 and No. 3/2022 of January 28th 2022 (the “EPC Contract”), a letter concerning initiation of a procedure to amend the EPC Contract for the execution of the Polimery Police project (the “Polimery Police Project”) (the “Amendment Proposal”).

The EPC Contract amendments proposed by the Contractor concern matters relating to increasing the Contractor’s fee by a total amount of EUR 24.15m. As the reason for submitting the Amendment Proposal the Contractor cites in particular the impact of European sanctions imposed on Russia and the war in Ukraine on the execution of the Polimery Police project, as well as other events beyond the Contractor’s control (in particular the COVID-19 pandemic), which impeded the implementation of the Polimery Police project.

The Amendment Proposal will be thoroughly reviewed and verified in terms of its appropriateness under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the Contractor, as well as in the light of facts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on May 22nd 2023 its Management Board passed a resolution proposing that the Company’s entire net profit for the financial year 2022, in the amount of PLN 356,059,831.38 (three hundred and fifty-six million, fifty-nine thousand, eight hundred and thirty-one złotys, 38/100), be allocated to the Company’s statutory reserve funds.

The Company and its subsidiaries are in the process of implementing the Azoty Group Strategy for 2021-2030. The Strategy aims to carry into effect the mission and vision of the Grupa Azoty Group (the “Group”), according to which the Group is to manufacture fertilizers, plastics and chemical products in harmony with the environment, improve the well-being of people living in Europe and actively contribute to building the continent’s food security as a supplier of effective solutions and reliable manufacturer of fertilizers, plastics and green chemical products.

The Strategy envisages further pursuit of the ongoing investment projects, in particular the launch of the new business segment of Polyolefins through the implementation of the Polimery Police project, and also commencement of further important projects relating especially to the climate and energy transition aimed at lowering environmentally harmful emissions through reduced consumption of coal, decarbonisation, and development of RES and zero-carbon sources.

In view of the above, the Management Board recommends that the entire net profit for 2022 be retained in the Company. By retaining earnings, the Company will secure financing for its planned investment projects that increase the Company’s shareholder value, with particular focus on those related to energy transition.

It is also necessary to take into account the deterioration of the Company’s operating environment due to the demand slump caused by inflation and rising interest rates. Since these circumstances may adversely affect the Company’s and the Group’s results and debt in 2023 and beyond, it is reasonable to allocate the Company’s entire net profit for the financial year ended December 31st 2022 to statutory reserve funds.

In order to implement the resolution, the Management Board will request the Supervisory Board to assess the proposal and the General Meeting to decide on the allocation of net profit for 2022. The final decision on allocation of the 2022 net profit will be made by the General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 8/2023 of March 9th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the Management Board of the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) has resolved to resume melamine production (Agro Segment) and to commence preparations on May 17th 2023 for the start-up of the Melamine III unit. The unit’s production volumes will be adjusted according to current supply and demand. The Melamine III unit’s daily capacity of 90 tonnes accounts for approximately one-third of the rated capacity of all melamine units operated by the Subsidiary.

The Subsidiary announced the resumption of melamine production in Current Report No. 21/2023 of May 17th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the first quarter of 2023.

Discussion of Q1 2023 estimated results

In the first quarter of 2023, the Group generated estimated consolidated revenue of PLN 3,895m, EBITDA of PLN -401m, and EBITDA margin of -10.3%.

The quarter saw continuing demand-supply imbalances in European markets caused, among others, by the consequences of Russia’s military aggression against Ukraine, persistently high inflation, high prices of energy carriers, including electricity and coal, and duty-free non-EU imports of fertilizers and plastics produced with cheaper raw materials. These developments led to a drop in demand for the Company’s products.

During the period under analysis, a decline was observed in the activities of the economic sectors buying the Group’s products, such as the automotive, construction and furniture industries. The supply-demand imbalance resulted in pressures to reduce product prices and in output cuts, which the Company has been announcing in monthly current reports since the beginning of this year. The Company expects the market to improve from the third quarter of 2023.

The first quarter results were bolstered by PLN 234m in funding granted to the Group companies by the National Fund for Environmental Protection and Water Management as part of the support provided to energy-intensive sectors in view of the sudden increases in natural gas and electricity prices in 2022.

Although the Group is taking measures to boost its operating profitability, it does not rule out the possibility of exceeding the permitted level of the net debt/EBITDA ratio at the end of the first half of 2023. Should this scenario become likely, the Company will take appropriate pre-emptive steps to mitigate the risks.

The key operational factors that impacted the results posted by the main segments were as follows:

Agro

Fertilizer sales fell in the first quarter due to low purchasing activity of customers. In addition, the supply-demand situation was adversely affected by EU and non-EU imports (mainly of urea), which were driven, among others, by the decision of the Council of the European Union of December 16th 2022 to temporarily suspend urea and ammonia tariffs. In the case of compound fertilizers, a year-on-year increase in the prices of key raw materials (phosphate rock, potassium chloride) caused the prices of these fertilizers to grow. Coupled with a slump in demand, this led to a lower output and sales of compound fertilizers compared to the same period last year.

In the Agro Segment, a year-on-year decline in the prices of natural gas, being the key feedstock for the manufacture of nitrogen fertilizers, did not offset the drop in product prices and sales volumes.

The Group adjusted its fertilizer production to demand and supply conditions on an ongoing basis and, like most European fertilizer producers, significantly reduced their output.

The Agro Segment’s estimated EBITDA margin for the first quarter of 2023 stood at -5.9%.

Chemicals

Due to low buyer activity, the Chemicals Segment reported a significant decline in sales volumes, mainly of melamine and OXO alcohols. Higher sales volumes were observed in the case of sulfur, which was mainly exported. In addition, demand in the Chemicals Segment was adversely impacted by high inventory levels at customers. Prices of most products were lower than in the same period last year. Price increases were reported for titanium white, urea solution (PULNOx) and ammonia water (LIKAM).

The Segment’s result was boosted by a drop in the price of the main raw material, propylene. In the case of the other raw materials, their prices were close to or higher than those reported in the first quarter of 2022.

Due to the supply and demand situation, the production of melamine at Grupa Azoty PUŁAWY was temporarily suspended in March.

The Chemicals Segment’s estimated EBITDA margin for the first quarter of 2023 stood at -7.2%.

Plastics

In Europe, demand for the segment’s products from all of the key sectors (automotive, construction, and packaging) remained low. Moreover, manufacturers were under strong pressures from non-EU imports. As a result of the adverse market conditions, the Plastics Segment reported a year-on-year decline in both sales volumes and prices of natural polyamide, its key product.

Prices of the main raw materials for caprolactam and polyamide production (benzene, phenol) fell year on year, but high inventory levels throughout the supply chain of the aforementioned sectors caused a postponement of purchasing decisions.

Due to the supply and demand situation, the production of caprolactam at Grupa Azoty PUŁAWY was temporarily suspended in March.

The Plastics Segment’s estimated EBITDA margin for the first quarter of 2023 stood at -28.0%.

The amounts presented above are preliminary and may be subject to change. The final figures will be presented in the consolidated report for the first quarter of 2023, scheduled to be published on May 22nd 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. publishes, attached hereto, estimates of consolidated production output in April 2023.

Actual output figures will be released in the consolidated report for the first half of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 5/2023 of January 20th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the release date for the consolidated report for the first quarter of 2023 has been changed from May 25th 2023 to May 22nd 2023.

The release dates for the interim reports for the first half and the third quarter of 2023 remain unchanged, with the updated release dates for interim reports in 2023 provided below:

1. First and third quarter interim reports:

• Q1 2023 complete consolidated report – May 22nd 2023
• Q3 2023 complete consolidated report – November 8th 2023

2. Half-year interim reports:

• H1 2023 complete consolidated report – August 30th 2023

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that it was notified by its subsidiary company, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), of a contract for the purchase of propane signed on April 27th 2023 with TOTSA Total Energies Trading SA, Switzerland (the “Seller”).

The contract provides that propane will be delivered by the Seller to the Subsidiary from April 2023 to the end of November 2024, in accordance with the agreed schedule and commercial terms. Propane volumes delivered under the contract will be supplementary to other deliveries and in 2023 will cover approximately 46% of the Subsidiary’s total requirement for this key production feedstock.

The value of the deliveries to be made under the contract is estimated at approximately USD 90m.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimates of consolidated production output in March 2023.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Reports No. 15/2021 of April 29th 2021 and 5/2022 of March 31st 2022, the Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on March 21st 2023 the Company, together with its subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., COMPO EXPERT GmbH and COMPO EXPERT Hellas S.A. (jointly with the Company referred to as the “Factorees”), signed with CaixaBank S.A. Polish Branch, amended Annex 1 to the payment services and financing agreement of April 29th 2021, as amended (“Annex to the Reverse Factoring Agreement, “Reverse Factoring Agreement”).

The amendment to the Annex to the Reverse Factoring Agreement increased the factoring limit from PLN 800m to PLN 950m (or its equivalent in EUR or USD). The limit under the Reverse Factoring Agreement is available until April 30th 2024. The Bank’s claims under the Reverse Factoring Agreement are secured by a notarised statement of submission to enforcement made by the Company, for up to 120% of the Reverse Factoring Agreement amount as increased under the Annex to the Reverse Factoring Agreement. The other material terms of the Reverse Factoring Agreement were presented in the Company’s Current Reports No. 15/2021 of April 29th 2021 and No. 5/2022 of March 31st 2022.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the security of financing for the Group and its suppliers by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimates of selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the fourth quarter of 2022 and for 2022.

Commentary on fourth-quarter 2022 results

In the fourth quarter of 2022, the Grupa Azoty Group generated consolidated revenue of PLN 5,107m and negative EBITDA of PLN -296m, with a negative EBITDA margin of -5.8%.

The Group’s results for the fourth quarter of 2022 were adversely affected by significant impairment losses on non-financial non-current assets and write-downs of inventories of finished goods, semi-finished products and raw materials. Information on the impairment losses and write-downs recognised on these assets was announced by the Company on March 13th 2023 in Current Report No. 11/2023.

The inventory write-downs recognised in the fourth quarter of 2022 led to a drop in consolidated EBIT and EBITDA by approximately PLN 404m.

The recognition of the impairment losses on non-financial non-current assets resulted in a decrease of PLN 963m in the Grupa Azoty Group’s consolidated EBIT for 2022. In accordance with the Group’s accounting policies, the impairment losses and write-downs are one-off non-cash charges and have no effect on the Group’s consolidated EBITDA.

Main factors with a bearing on the Group’s financial performance in the key segments in the fourth quarter of 2022 compared with the fourth quarter of 2021:

Agro

The Agro Segment’s performance in the fourth quarter of 2022 was mainly determined by strong volatility of commodity prices, including natural gas, demand-supply imbalances and falling prices of agricultural crops.

Natural gas prices in the period under review changed rapidly, and the TTF spot price ranged from EUR 22 to EUR 160 per MWh. In view of a downward trend in gas prices, in October 2022 the three key companies of the Grupa Azoty Group decided to resume production of nitrogen fertilizers that had been suspended or curtailed in August 2022.

The fertilizer market was stagnant in the fourth quarter of 2022. Producers looked forward to market activity and an increase in sales in view of the upcoming fertilizer season, while customers were holding off on purchases in anticipation of a drop in fertilizer prices as gas prices fell quarter on quarter. The consequence of these divergent expectations was low demand and growing fertilizer stocks at manufacturers and distributors. Another reason for the reduction of purchases by customers was the worrisome signals from the agricultural market, especially the observed downward trend in prices of agricultural crops, which was driven by high grain imports from Ukraine.

The Agro Segment’s EBITDA margin generated in the fourth quarter of 2022 was significantly lower year on year and fell to -5.3%. The Segment’s results were reduced by the impairment losses and write-downs.

Chemicals

In the Chemicals Segment, low demand and imports of competitively priced products from Asian markets were observed in the fourth quarter of 2022. At the same time, prices grew year on year for all products except sulfur and fell quarter on quarter (with the exception of melamine). Product sales volumes declined considerably year on year, with increases recorded only for sulfur.

The market showed little demand for OXO alcohols, plasticizers, titanium white, melamine and NOXy as products from the segment’s portfolio came in high quantities to the European market from Asia. The market also kept a close eye on the possible impact of an increase in China’s export capacity due to production recovery following the lifting of the preventive measures introduced under the zero COVID policy. Melamine production at Grupa Azoty Zakłady Azotowe Puławy S.A., limited since July 2022, was partially resumed at the end of October 2022.

The Chemicals segment’s EBITDA margin delivered in the fourth quarter of 2022 was negative at -3.9%. The Segment’s results were reduced by the impairment losses and write-downs.

Plastics

In the Plastics Segment, prices of raw materials (benzene, phenol) and products declined quarter on quarter and rose year on year. Market prices of polyamide went on a downward trend as a result of weak demand, an influx of imports and falling prices of raw materials and energy. Demand shrank across all industries: automotive, construction, packaging, electronics and electrical engineering.

Following change in market conditions, including a quarter-on-quarter decrease in the prices of basic raw materials (benzene and phenol), a decision was made in October 2022 to resume production of caprolactam and polyamide 6 at the production facilities of the Company and Grupa Azoty Zakłady Azotowe Puławy S.A., which had been halted in August 2022 due to high costs of raw materials.

The Segment’s EBITDA margin delivered in the fourth quarter of 2022 was negative at -43.4%. The Segment’s results were reduced by the impairment losses and write-downs.

Key performance drivers in 2022

In 2022, the Grupa Azoty Group generated consolidated revenue of PLN 24,658m and EBITDA of PLN 2,545m, with an EBITDA margin of 10.3%.

The Group’s performance in the reporting period was determined largely by the market consequences of Russia’s armed aggression against Ukraine and the record increase in prices of raw materials used in production and energy carriers. As a consequence of the macroeconomic climate, each business segment recorded a significant rise in product prices and a simultaneous decrease in sales volumes, and experienced demand-supply imbalances. Growing inflation and the resulting increase in fixed costs also weighed on performance.

The demand-supply imbalance observed during 2022, combined with the strong volatility in raw material prices, made it necessary to temporarily stop or cut production at the three key companies of the Grupa Azoty Group, i.e., Grupa Azoty S.A. (fertilizers and plastics), Grupa Azoty Zakłady Azotowe Puławy S.A. (fertilizers, caprolactam and melamine) and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (fertilizers).

The Company’s financial statements for 2022 are being audited, therefore the presented figures are estimates and may be subject to change. The final figures will be presented in the consolidated report for 2022, scheduled for issue on March 30th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the „Company”) announces that as a result of impairment tests carried out at the Company for non-current assets of the Fertilizers cash generating unit (CGU) and Plastics CGU, in the case of the Plastics CGU a negative difference has been identified between the recoverable amount and carrying amount of the assets, and a decision has been made to recognise impairment losses of PLN 88m. No impairment losses were necessary in the case of the Fertilizers CGU.

The impairment has been recognised based on the projected financial performance of the Plastics CGU in the context of the significant capital expenditure that will be required, in particular in connection with the more stringent requirements regarding environmental protection and reduction of the energy and emissions intensity of the Company’s manufacturing activities, as well as a material increase in market interest rates, affecting the discount rate for projected future cash flows.

Recognition of the impairment losses will have an effect on the Company's 2022 financial statements by reducing separate EBIT by PLN 88m. In accordance with the Grupa Azoty Group’s accounting policies, impairment losses are one-off non-cash charges and have no effect on the Company's separate EBITDA.

At the same time, impairment tests carried out for non-current assets of the Company's subsidiaries led to the identification of a negative difference between the recoverable amount and the carrying amount of the assets, and decisions have been made to recognise impairment losses on non-current assets of the Plastics and Melamine CGUs of Grupa Azoty Zakłady Azotowe Puławy S.A. and of the Fertilizers and Pigments CGUs of Grupa Azoty Zakłady Chemiczne Police S.A.

Recognition of the impairment losses on non-current assets at the Company and its subsidiaries will have an effect on the Group's 2022 consolidated financial statements by reducing consolidated EBIT by a total of PLN 963m. In accordance with the Grupa Azoty Group’s accounting policies, impairment losses are one-off non-cash charges and have no effect on the Company's consolidated EBITDA.

The Company's Management Board further announces that inventory write-downs have been recognised as at the reporting date in the Company’s financial statements. Net inventory write-downs recognised in Q4 2022 totalled approximately PLN 64m, and had the effect of reducing the Company's EBIT and EBITDA.

Inventory write-downs have also been recognised in the financial statements of the Company's subsidiaries. They will reduce the consolidated EBIT and EBITDA in the 2022 consolidated financial statements of the Grupa Azoty Group by approximately PLN 404m.

The inventory write-downs were required in view of the lower product selling prices seen since the beginning of 2023, which in the case of some of the products are below cost.

The write-downs are non-cash charges and have no effect on the liquidity position of the Company or its Group.

Information on expected impairment losses and inventory write-downs to be recognised in the 2022 financial statements has been reported by the subsidiaries, i.e. Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Chemiczne Police, in their Current Reports No. 9/2023 of March 13th 2023 and No. 6/2023 of March 13th 2023, respectively.

As the audit of the 2022 financial statements of the Company and its subsidiaries has not yet been completed, the amounts above are not final and are subject to change. The Company's full-year report is scheduled to be issued on March 30th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty Group’s estimated consolidated production output in February 2023 and scheduled maintenance shutdown of the ammonia and urea production lines at the Company's subsidiary

Further to Current Report No. 7/2023 of February 22nd 2023, the Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimates of consolidated production output in February 2023.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2023.

At the same time, the Management Board announces that on March 10th 2023, the Management Board of the Company's subsidiary Grupa Azoty Zakłady Azotowe Police decided, despite activities undertaken to increase sales, to continue the scheduled maintenance shutdown of the ammonia and urea production lines until March 31st 2023. The decision was made in view of the aggravating negative supply and demand situation in the market.

Information on the shutdown was released by the subsidiary in Current Report No. 5/2023 of March 10th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Text of the report: The Management Board of Grupa Azoty S.A. (the “Company”) announces that on March 10th 2023 it was notified that the National Fund for Environmental Protection and Water Management had granted the Company’s request for financial support as part of aid to energy-intensive sectors related to sudden increases in natural gas and electricity prices. The amount of aid granted to the Company is PLN 52.3m.

Financial support was also granted to other companies of the Grupa Azoty Group. The aggregate amount of support granted to the Group companies, i.e. Grupa Azoty S.A., Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. and Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A., is PLN 234.2m.

The aid amount will be included in their respective separate and consolidated Q1 2023 accounts by increasing EBITDA.

The funds were granted under the Act on the rules of implementation of business support programmes in view of the situation on the energy market in 2022-2024,dated September 29th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on March 9th 2023 the Management Board of the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) made a decision to suspend production of caprolactam (Plastics Segment) and operation of the Melamine III unit (Agro Segment) effective from March 10th 2023 until further notice. Production at the remaining melamine units (Melamine I and Melamine II) was halted in the summer of 2022, as announced by the Subsidiary in Current Report No. 21/2022 of July 8th 2022 and Current Report No. 23/2022 of August 10th 2022.

The current stoppage of caprolactam and melamine production is associated with the supply and demand situation on the European market.

The information on the production closedown was released by the Subsidiary in Current Report No. 6/2023 of March 9th 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby announces that, with a view to enhancing the transparency of the Company’s information disclosure policy intended to ensure that investors are provided with access to information relevant to the assessment of the Company’s and the Grupa Azoty Group’s situation and outlook, a decision was made on February 22nd 2023 to commence regular publication of estimates of the Group’s consolidated production output on a monthly basis.

Monthly reports on estimated production output will be released as soon as data for a given month are aggregated, but in any case no later than by the 15th day of the following month. 

Accordingly, the Company publishes, attached hereto, estimates of consolidated production output in January 2023.

Actual quarterly output figures will be released in the consolidated report for the first quarter of 2023.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on February 9th 2023 the Supervisory Board of the Company appointed Marcin Kowalczyk as Vice President of the Management Board of the 12th term, with effect from February 10th 2023.

The Management Board further announces that Marcin Kowalczyk has made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of a governing body of any other competing legal entity.

Marcin Kowalczyk is not entered in the Register of Insolvent Debtors maintained pursuant to the National Court Register Act.

A brief description of the newly appointed Vice President’s educational background, qualifications, previously held positions and employment records is attached to this current report.

Legal basis: Par. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Grupa Azoty S.A. (the “Company”) will announce its 2022 full-year results and 2023 interim results as per the following schedule:

1. First and third quarter interim results:

- Q1 2023 complete consolidated report – May 25th 2023
- Q3 2023 complete consolidated report – November 8th 2023

2. Half-year interim results:

- H1 2023 complete consolidated report – August 30th 2023

3. Full-year results:

- 2022 separate full-year report – March 30th 2023
- 2022 consolidated full-year report – March 30th 2023

The 2022 consolidated report on payments to governments will be released on March 30th 2023.

Furthermore, the Company announces that no separate quarterly results will be published by the Company, as permitted under Par. 62.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757) (the “Regulation”). The consolidated quarterly reports will incorporate quarterly condensed consolidated financial statements and quarterly financial information.

Also, the Company will not publish a separate (non-consolidated) half-year report, as permitted under Par. 62.3 of the Regulation.

Further, the Company will not publish separate or consolidated quarterly results for Q4 2022 and Q2 2023, as permitted under Par. 79.2 of the Regulation.

Legal basis: Par. 80.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Company’s Supervisory Board, at its meeting held on January 16th 2023, passed a resolution to remove from the Management Board one of its Vice Presidents Mr Tomasz Hryniewicz. The removal of Mr Tomasz Hryniewicz from the Management Board becomes effective as of the end of day January 16th 2023.

The resolution of the Supervisory Board regarding the removal of the Vice President took effect upon its adoption.

Legal basis: Par. 5.4 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 2/2023 of January 11th 2023, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached hereto, a brief description of the educational background, qualifications, previously held positions and employment record of the newly appointed Member of the Company’s Supervisory Board, Ms Marzena Małek.

The Management Board further announces that Ms Marzena Małek has made a representation to the effect that she is not engaged in any activities competing with the Company’s business, nor is he a partner or shareholder in any competing partnership or company or a member of governing bodies of such partnership or company. 

The representation received by the Company includes a statement to the effect that the new Member of the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Par. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on January 11th 2023 it received a notification from the Minister of State Assets, dated January 10th 2023, of the appointment, pursuant to Art. 16.2 of the Company’s Articles of Association, of Ms Marzena Teresa Małek to the Company’s Supervisory Board of the 11th joint term of office as of January 11th 2023.

A brief description of the newly appointed Supervisory Board Member’s educational background, qualifications, previously held positions and employment records, together with all the representations required from him, will be published by the Company as soon as practicable.

Par. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on January 3rd 2023 it received a notice of resignation from Mr Marcin Mauer from his position as Member of the Company’s Supervisory Board.

Mr Mauer did not specify the reasons for his resignation.

Legal basis: Par. 5.4) of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 22/2022 of July 20th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 23rd 2022 the Company, VSB Holding GmbH of Dresden, Germany and Mr Janusz Franciszek Siemieniec (collectively the “Sellers”) defined the term sheet for the purchase of 100% of shares in the share capital of Solarfarm Brzezinka sp. z o.o. (the “Transaction”).

In accordance with the Term Sheet, the Transaction will be carried out by entering into a preliminary conditional share purchase agreement to acquire in the future 100% of shares in Solarfarm’s share capital, followed by the purchase of the shares under a share purchase agreement in the first half of 2024 by the Company or another company of its Group, provided that technical conditions are adjusted and building permits for the construction of a power plant are obtained.

The Brzezinka solar farm, located in Brzezinka and Syców, together with infrastructure with a power output of 270 MWp or more, will be built as a turn-key project under an EPC contract planned to be concluded by Solarfarm with VSB Energie Odnawialne Polska sp. z o.o., a member of the VSB Group, as the general contractor.

The total value of the investment is estimated at EUR 240m.

The execution of the Term Sheet does not give rise to any obligation to enter into the contemplated Transaction, or any share purchase agreement, and is not binding on the parties. However, the parties undertook to negotiate the share purchase and the contemplated transaction in good faith, in accordance with the Term Sheet.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on December 16th 2022 it was notified by its subsidiary, Grupa Azoty Polyolefins S.A. (the “Subsidiary”), of a contract for the purchase of propane signed with Trafigura Pte Ltd, Singapore.

The contract provides propane will be delivered to the Subsidiary from December 2022 to December 2024 in accordance with the agreed schedule and commercial terms. Deliveries of propane made under the contract will cover more than 50% of the Subsidiary’s demand for propane in 2023 and 2024. Propane is the key raw material for production due to commence once the Subsidiary brings the Polimery Police project online.

The value of the deliveries to be made under the contract is estimated at approximately USD 250m.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the third quarter and the first nine months of 2022.

Discussion of the results for the first nine months of 2022:

In the first nine months of 2022, the Grupa Azoty Group generated consolidated revenue of PLN 19,551m, EBITDA of PLN 2,842m, and an EBITDA margin of 14.5%.

In the reporting period, the Group’s performance was affected by the consequences of Russia’s armed aggression against Ukraine and the unprecedented spike in prices of commodities, in particular natural gas, being the main raw material used in fertilizer production.

Discussion of the results for the third quarter of 2022:

In the third quarter of 2022, the Group generated consolidated revenue of PLN 6,314m, EBITDA of PLN 267m and EBITDA margin of 4.2%. Year on year, the Group recorded a drop in results.

The above figures were delivered amid high uncertainty caused by soaring and volatile prices of commodities, in particular natural gas, which resulted in temporary production cuts at certain units of the Company and its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A.

Main factors with a bearing on the Group’s financial performance in the key segments in the third quarter of 2022 compared with the third quarter of 2021:

1. In the Agro segment:

The reporting quarter saw further increases in the prices of raw materials used in fertilizer production, in particular natural gas, being a consequence of Russia’s armed aggression against Ukraine.

The rapid growth in natural gas prices which began in the second half of 2021 continued, reaching a peak at the end of August 2022. The average market price of natural gas in the third quarter of 2022 compared to the same period last year rose by more than 300%.

As a consequence of the unprecedented increases in the price of natural gas, a decision was made in August 2022 to temporarily reduce production at three key companies of the Group: the Company, Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. The Group companies were among the last producers in the European Union who decided to cut production.

The Agro Segment’s EBITDA margin generated in the third quarter of 2022 stood at 1.6%.

2. In the Chemicals segment:

In the third quarter of 2022, the product demand situation and growing prices of raw materials used in production were the main determinants of the Chemicals Segment’s performance. Demand on the target markets was relatively weak and European producers came under significant competitive pressure from non-EU imports.

As a result of the adverse market situation, melamine production at Grupa Azoty Zakłady Azotowe Puławy S.A. was temporarily suspended.

The products for which a year-on-year growth in sales volumes was reported were sulfur and NOXy.

The EBITDA margin achieved by the segment in the third quarter of 2022 stood at 0.8%.

3. In the Plastics segment:

In the third quarter of 2022, the Plastics Segment reported significant volatility in prices of key raw materials: benzene and phenol. The prices climbed to record highs in July 2022 to start a steep decline in August. The high cost of raw materials prompted the decision to temporarily halt production.

The Plastics segment was mainly affected by poor demand from the main markets of polyamide applications. The demand situation was additionally aggravated by the summer holiday season. The exception was the packaging sector where demand remained stable throughout the reporting period. There were no signs of any significant demand recovery in the EU automotive industry, an important customer for the Plastics segment. Moreover, the reporting period saw higher imports of more attractively priced polyamide products and derivatives into the European market.

The segment’s EBITDA margin generated in the third quarter of 2022 was negative at -2.7%.

The amounts presented above are estimates and may be subject to change. The final results will be presented in the consolidated report for the third quarter and the nine months ended September 30th 2022, to be issued on November 9th 2022.

Information on decisions concerning production cuts at the Group companies was published by the Company in Current Reports No. 23/2022 and No. 24/2022 of August 22nd 2022, No. 25/2022 of August 23rd 2022, No. 31/2022 and No. 32/2022 of October 12th 2022, No. 33/2022 of October 21st 2022, and No. 34/2022 of October 27th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) announces that item 3 of the list of shareholders holding 5% or more of total voting rights at the Company’s Annual General Meeting (the “AGM”) held on June 29th 2022, published in Current Report No. 19/2022 of June 29th 2022, erroneously included a Shareholder, registered and entitled to participate in the AGM, who eventually did not confirm their presence at the AGM on June 29th 2022.

The Company publishes, attached to this report, a corrected list of shareholders holding 5% or more of total voting rights at the Annual General Meeting held on June 29th 2022, specifying the number of voting rights conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at the Annual General Meeting and in total voting rights.

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2021, item 1983, as amended).

Further to Current Report No. 23/2022 of August 22nd 2022 and Current Report No. 32/2022 of October 12th 2022, the Management Board of Grupa Azoty S.A. announces that on October 27th 2022 Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) decided to resume the production of melamine (Agro Segment) by putting in operation the Melamine III unit, and caprolactam (Plastics Segment).

The information was released by the Subsidiary in Current Report No. 30/2022 of October 27th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 25/2022 of August 23rd 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on October 21st 2022 the Management Board of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., the Company’s subsidiary, decided to scale up the operation of the Fertilizer Production Unit to full available capacity.

The capacity will come on stream following a periodic maintenance shutdown, with the production restart due to begin on October 21st 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Further to Current Report No. 23/2022 of August 22nd 2022, the Management Board of Grupa Azoty S.A. announces that on October 12th 2022 Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”), in response to a change in market conditions, resolved to increase capacity utilisation and start up the Agro Segment’s process units used to make nitrogen fertilizers (PULAN^®, PULAN^® MACRO, SALETRZAK 27N, PULREA^®, PULREA^®+INu, RSM ®) as of October 12th 2022.

Taking into account the current production (Agro Segment: ammonium sulfate from the Flue Gas Desulfurisation Unit, non-fertilizer products excluding melamine), the process plant that will remain shut down after the full start-up of the fertilizer production units will be the caprolactam unit (Plastics Segment) and the melamine unit (Agro Segment).

The information was released by the Subsidiary in Current Report No. 29/2022 of October 12th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Further to Current Report No. 24/2022 of August 22nd 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that, in response to a change in market conditions, it has resolved to start production at the previously shut-down nitrogen fertilizer, caprolactam and polyamide 6 units as of October 12th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 26/2015 of April 23rd 2015, Current Report No. 52/2016 of September 20th 2016 and Current Report No. 34/2018 of June 29th 2018, the Management Board of Grupa Azoty S.A. (the “Company” or the “Borrower”) announces that on September 26th 2022 the Company and selected other companies of its Group (the “Borrowers” or the “Group Companies”) signed an annex to a PLN 240m multi-purpose credit facility agreement (the “MPCF Agreement”) with Powszechna Kasa Oszczędności Bank Polski S.A. (the “Bank”). Under the annex:

a) Group Companies which had not been parties to the MPCF Agreement joined the MPCF Agreement as borrowers;
b) the term of the MPCF Agreement, expiring on September 30th 2022, was extended until September 30th 2025 (the “Facility Term”), with the option to extend it for subsequent 12-month periods;
c) the credit limit under the MPCF agreement was increased to PLN 1bn (the “Facility Limit”);
d) an overdraft facility was made available within the Facility Limit to Grupa Azoty S.A.;
e) a revolving working capital facility, bank guarantees and bank letters of credit were made available within the Facility Limit to Grupa Azoty S.A. and the Group Companies that are parties to the MPCF Agreement;
f) bank guarantees issued by the Bank to Group Companies under separate agreements were incorporated into the MPCF Agreement as of September 30th 2022;
g) the following companies: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. and Grupa Azoty Zakłady Chemiczne Police S.A. (the “Key Subsidiaries”) were released from their obligations under a surety agreement for the MPCF Agreement of June 29th 2018.

As at the annex date, the following limits and sub-limits were set within the Facility Limit with effect from September 30th 2022:

1) limit of the overdraft facility for Grupa Azoty S.A.: up to PLN 300 m;

2) sub-limits for the revolving facility, guarantees or letters of credit – for Grupa Azoty S.A.: up to PLN 575.15m, for Grupa Azoty Zakłady Chemiczne Police S.A.: up to PLN 62m, for Grupa Azoty Zakłady Azotowe Puławy S.A.: up to PLN 1m, for Grupa Azoty Zakłady Azotowe Kędzierzyn S.A.: up to PLN 30m, and for other Grupy Azoty companies that are borrowers under the MPCF Agreement: up to PLN 31.85m in total.

 The Company is liable to repay all amounts due under the MPCF Agreement, and each of the other Borrowers (i.e. the Company’s subsidiaries) is liable to repay the amounts due under the facility which were drawn under the sub-limit made available to the Borrower.  The facility bears interest at an annual rate equal to the reference rate 1M WIBOR for the PLN denominated facility, 1M EURIBOR for the EUR denominated facility, and 1M LIBOR for the USD denominated facility, plus the Bank's margin.

The Company's Management Board further announces that on September 26th 2022 the Company, together with other Group Companies, entered into a PLN, EUR and USD physical cash pooling agreement with the Bank for the period until September 30th 2025 (the “PCP Agreement”).

The PLN, EUR and USD physical cash pooling structures are designed to optimise the interest income and expenses and to enable the Group companies to use the Group’s global liquidity limit within the positive and negative balances in the companies’ current accounts.

In addition, the Company's Management Board announces – in connection with the execution of the MPCF Agreement and the PCP Agreement and

1. with reference to Current Report No. 16/2011 of March 30th 2011, Current Report No. 109/2011 of December 7th 2011, Current Report No. 113/2013 of August 20th 2013, Current Report No. 26/2015 of April 23rd 2015, Current Report No. 52/2016 of September 20th 2016, and Current Report No. 34/2018 of June 29th 2018 – that the following will expire on September 30th 2022: the PLN 310m overdraft facility agreement executed, together with other Group companies, on October 1st 2010, as amended (the “Overdraft Facility Agreement”), and the related PLN physical cash pooling agreement of September 30th 2016m, as amended (the “PLN PCP Agreement”), as well as sureties for liabilities under the Overdraft Facility Agreement totalling PLN 372m, issued under a surety agreement executed on June 29th 2018 between the Bank, the Company and the Key Subsidiaries as sureties;
2. with reference to Current Report No. 57/2018 of November 2nd 2018 – that the following agreements executed, together with other Group companies, with the Bank will expire on September 30th 2022: an overdraft facility agreement of November 2nd 2018, as amanded, for EUR 75m or its equivalent in USD (the “EUR and USD Overdraft Facility Agreement”) and the related EUR and USD physical cash pooling agreement of November 2nd 2018, as amended (the “EUR and USD PCP Agreement”).

The MPCF Agreement also imposes certain restrictions on the Company and the Key Subsidiaries, including restrictions on disposal or encumbrance of its material assets, granting loans and guarantees, paying dividends and incurring financial liabilities if the consolidated net debt to EBITDA ratio thresholds agreed with the lenders are exceeded, which have been made consistent with the Credit Facility Agreement of April 23rd 2015, as amended by the Amending Agreement of June 29th 2018 referred to in Current Report No. 25/2015 of April 23rd 2015 and Current Report No. 33/2018 of June 29th 2018.

The amendments introduced to the MPCF Agreement under the annex, in particular consolidation of the facilities used under the MPCF Agreement and the Overdraft Facility Agreement, and release of the Key Subsidiaries from their obligations under sureties issued for those agreements, as well as consolidation of the PLN, EUR and USD physical cash pooling services under a single PCP Agreement, are intended to further optimise the long-term financing package for the financing of general corporate needs and to ensure security of financing for the Group companies by putting in place an umbrella structure for the allocation of limits and actual intra-group redistribution.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial results of the Grupa Azoty Group (the “Group”) for the second quarter and the first half of 2022.

Discussion of the results for the first half of 2022

In the first half of 2022, the Grupa Azoty Group generated consolidated revenue of PLN 13,237m, EBITDA of PLN 2,575m, and an EBITDA margin of 19.5%.

Discussion of the results for the second quarter of 2022

In the second quarter of 2022, the Group generated consolidated revenue of PLN 6,410m, EBITDA of PLN 1,240m, and an EBITDA margin of 19.3%.

The results were positively impacted by the level of product prices in Europe in the markets where the Group operates.

The Group’s results were adversely impacted by record high prices of raw materials used in production processes and lower sales volumes for most fertilizer groups, chemical products and plastics.

The results generated by the Group during the period under review were strongly influenced by the turbulence caused by Russia’s aggression against Ukraine, which has a negative effect on the availability and prices of raw materials, eventually translating into rising prices of final products.

Main drivers of the results for the second quarter of 2022 in the key segments:

Agro

In the Agro Segment, the reported quarter was another consecutive period of high prices of feedstock and raw materials used in fertilizer production, particularly natural gas, potassium chloride and phosphate rock.

The challenging conditions in the raw materials market are a consequence of Russia’s aggression against Ukraine, which has led to Russia reducing or completely halting gas supplies to the EU countries. The chains of supply to the Group of some important raw materials and intermediates have also been changed or disrupted.

As a consequence of production cutbacks introduced by key European fertilizer producers due to record high prices of commodities, particularly natural gas, the supply of fertilizers across Europe has significantly declined.

In the first half of 2022, the Group’s production units operated at full available capacity and the Group satisfied the demand for fertilizers on the Polish market during the spring fertilizer season.

Prices for natural gas, the key feedstock used in fertilizer production, were on a strong upward trend at the end of the second quarter of 2022, with record highs reached in the third quarter of 2022. The average market price of natural gas in the second quarter of 2022 compared to the same period last year rose by approximately 290%. These changes, combined with the market situation, led to a major spike in product prices.

The sales volume in the Agro Segment in the second quarter of 2022 was down 11% year on year, and even as much as 21% in the case of compound fertilizers.

The Agro Segment’s EBITDA margin generated in the second quarter of 2022 stood at 18.0%.

Chemicals

In the Chemicals Segment, the second quarter of 2022 saw a year-on-year increase in prices of all products, with a concurrent decrease in most products’ sales volumes. The rapid increase in the prices of raw materials for the production of chemicals significantly pushed up product prices, leading to a slump in demand.

The market situation for melamine was affected by the approaching end of the effective period of anti-dumping duties on imports of melamine from China into the EU.

In the case of sulfur, the price increase was a consequence of Russia’s military aggression against Ukraine and supply constraints due to the elimination of distribution channels from Russia and Kazakhstan.

The increase in sales volumes was recorded mainly for technical urea and OXO alcohols.

The segment’s EBITDA margin generated in the second quarter of 2022 stood at 22.0%.

Plastics

In the Plastics Segment, the second quarter of 2022 saw a year-on-year increase in the prices of the main raw materials used in production processes, that is benzene and phenol , by 18% and 24%, respectively , with a concurrent increase in the prices of polyamide manufactured at the Group. Polyamide sales volumes were slightly down year on year amid slumping demand in the automotive industry caused by difficulties securing semiconductors and other components the supply of which was not rebuilt after the COVID-19 pandemic.

This resulted in temporary production cuts and shutdowns at end users. The packaging sector continued to show a strong and stable demand.

The segment’s EBITDA margin generated in the second quarter of 2022 was 8.6%.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the first half of 2022, scheduled to be published on September 28th 2022.

At the same time, the Company would like to note that the results of future periods may be adversely affected by the consequences of partial production cuts at Grupa Azoty S.A., Grupa Azoty Zakłady Azotowe Puławy S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., introduced in the third quarter of 2022 due to an extraordinary and unprecedented increase in natural gas prices.

The Company announced the introduction of production cuts at the Group companies in Current Reports No. 23/2022 and 24/2022 of August 22nd 2022, and in Current Report No. 25/2022 of August 23rd 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, L 173/1 as amended).

Legal basis: Art. 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on September 19th 2022, following a tender procedure, the Company entered into a framework contract for the purchase of coal (the “Contract”) withthe successful bidder Polska Grupa Importowa Premium Sp. z o.o. of Katowice (the “Seller”).

The Contract provides for the supply of imported thermal coal. Coal deliveries to be made under the Contract will be complementary to other sources of coal used by the Company for energy generation purposes.

The Contract has been concluded for an indefinite period and contains general terms and conditions of cooperation related to the supply and offtake of coal. The total value of coal to be delivered in 2022 is estimated at approximately PLN 110m, VAT-exclusive.

Framework contracts for the purchase of coal from the Seller have also been concluded by the Company’s subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (jointly with the Company – the “Customers”). Coal deliveries to be made under the Contract will be complementary to deliveries received by the Customers from their strategic suppliers. The Contract also permits the Customers to redirect the contracted coal supplies between themselves

The total value of deliveries to be made from the Seller to the Customers in 2022 is estimated at approximately PLN 160m, VAT-exclusive. The Company may order further deliveries under the Contract in the future.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (“Company”) announces that on September 12th 2022, having completed a due diligence and valuation of the business of Zespół Elektrowni Wodnych Niedzica S.A. (“ZEW Niedzica”), with regard to the Grupa Azoty Group’s Strategy for 2021–2030 envisaging, among other things, the Group’s transition towards renewable energy sources, decided to request the Polish State Treasury, as the sole shareholder in ZEW Niedzica, to initiate a process leading to potential acquisition and integration of the company into the Grupa Azoty Group.

The principal business of ZEW Niedzica is the generation of renewable energy from hydropower assets – the pumped-storage hydroelectric power station in Niedzica, and the hydroelectric power plants in Sromowce Wyżne on the Dunajec River, and in Łączany and Smolice on the Vistula River. Their annual electricity output is approximately 100 GWh.

Further steps in the potential transaction and its optimal structure will be subject to specific arrangements with the State Treasury.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 2/2022 of January 28th 2022, the Management Board of Grupa Azoty S.A. announces that the release date for the consolidated H1 2022 report has been changed from September 7th 2022 to September 28th 2022.

The release date for the interim report for the third quarter of 2022 remains unchanged, with the updated release dates for interim reports in 2022 provided below:

1. H1 2022 complete consolidated report: September 10th 2022.

2. Q3 2022 complete consolidated report: November 9th 2022.

Legal basis: Par. 80.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Management Board of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., the Company’s subsidiary, has made the following decision:

“On August 23rd 2022, the Management Board of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. decided to scale down the operation of the Fertilizer Production Unit to the minimum capacity of 43% as of August 24th 2022. This decision is due to the extraordinary and unprecedented increase in natural gas prices.”

The current situation in the gas market, which determines the profitability of production activities, is extraordinary and completely beyond the control of the Grupa Azoty Group, and could not have been predicted.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on August 22nd 2022, in view of the extraordinary and unprecedented increase in natural gas prices, it decided to temporarily shut down the nitrogen fertilizer, caprolactam and polyamide 6 production units as of August 23rd 2022. The Company continues to produce catalysts, polyamide casings, humic acids, thermoplastic starch and concentrated nitric acid.

During the announced temporary shutdown of production units, investment and repair work will be carried out, including the scheduled overhaul of the Polyamide unit.

The current situation in the gas market, which determines the profitability of production activities, is extraordinary and completely beyond the control of the Company, and could not have been predicted.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. (the “Subsidiary”) has decided to temporarily reduce production as of August 22nd 2022 due to an extraordinary and unprecedented increase in natural gas prices. The Subsidiary will reduce its ammonia output to about 10% of capacity. Production activities in the Plastics and Agro Segments will be halted, with the exception of production of ammonium sulfate from the FGD Plant, NOXy®, Likam and PULNOX®.

During the announced temporary shutdown of the Subsidiary’s production units, investment and repair work will be carried out.

The information was released by the Subsidiary in Current Report No. 24/2022 of August 22nd 2022.

The current situation in the gas market, which determines the profitability of production activities, is extraordinary and completely beyond the control of the Grupa Azoty Group, and could not have been predicted.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on July 20th 2022 the Company entered into an agreement with VSB Holding GmbH of Dresden, Germany, Janusz Franciszek Siemieniec (collectively the “Sellers”) and Solarfarm Brzezinka Sp. z o.o. of Wrocław (“Solarfarm”) (the Company, the Sellers and Solarfarm are collectively referred to as the “Parties”) to conduct negotiations, on an exclusive basis, regarding the potential acquisition of 100% of shares in the share capital of Solarfarm Brzezinka sp. z o.o. (the “Agreement”).

The Parties expressed their interest in collaborating on a project to build the Brzezinka solar PV power plant with a capacity of approximately 270 MWp that is being developed by Solarfarm, comprising preparatory, construction and installation work, grid connection, commissioning and potential operation of the power plant (the “PV Project”). Once the Parties have agreed on the target business model and technical and economic parameters and once the conditions precedent agreed upon during negotiations have been met, the PV Project may be acquired by the Company or its subsidiary through acquisition of shares in Solarfar, unless the Parties agree on a different transaction model.

The Agreement sets out the terms and conditions of the negotiations to be conducted by the Parties on an exclusive basis with a view to closing the transaction and defining the terms of the collaboration, as well as the key parameters necessary for closing the transaction and enabling the collaboration, including the financial model and technical and economic parameters of the PV Project, the purchase price of Solarfarm shares, the price payment terms and price adjustment methods, if applicable.

If the transaction is closed, it will significantly contribute to achieving the goals outlined in the part of the Grupa Azoty Strategy 2021–2030 where it provides for the acquisition of own renewable energy sources.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Acting pursuant to Article 428.5 of the Commercial Companies Code, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached to this Current Report, its answers to the questions asked by a shareholder under Article 428.1 of the Commercial Companies Code during the Annual General Meeting of June 29th 2022.

Legal basis: Par. 19.1.12 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 23/2016 of April 13th 2016 on the execution of an agreement with Polskie Górnictwo Naftowe i Gazownictwo S.A. (“PGNiG”), No. 22/2017 of June 21st 2017 on the execution of Individual Contracts with PGNiG, and No. 30/2019 of May 23rd 2019 on their extension, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on July 7th 2022 the Company and its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A., Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. and Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A. (jointly: “Azoty Group Customers”) executed an annex to the framework gas supply agreement of April 13th 2016 and annexes to the Individual Contracts. As a result of the execution of the annexes to the Individual Contracts, PGNiG will remain the strategic supplier of gas fuel for the Azoty Group Customers until September 30th 2023. The total value of the annexes executed with the Azoty Group Customers for the term of extension of the Individual Contracts is estimated at PLN 13.04 billion. The pricing formula applied in the Individual Contracts is based on gas market price indices.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No.L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Annual General Meeting held on June 29th 2022, specifying the number of voting rights conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at the Annual General Meeting and in total voting rights.

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2021, item 1983, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Annual General Meeting on June 29th 2022, together with the results of voting.

The documents voted on by the Annual General Meeting are available on the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia. They have also been published with the Company’s separate and consolidated annual report for 2021 and attached to Current Report No. 16/2022 of June 2nd 2022.

In connection with the use of a computer system for voting and counting the votes, the Annual General Meeting decided not to appoint a Ballot Counting Committee.

The Annual General Meeting decided not to consider item 5 of the agenda ‘Resolution to abolish the secrecy of voting on the election of committees to be appointed by the Annual General Meeting’.

The Company’s Management Board also publishes, attached hereto, a draft resolution to adjourn the Annual General Meeting put forward by an entitled shareholder. The resolution was not passed by the Annual General Meeting.

Objections to Resolutions No. 5, 6 and 7 were raised by shareholders for the record in the minutes.

Legal basis: Par. 19.1.6–9 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 14/2021 of April 29th 2021, the Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on June 3rd 2022 the Company together with its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (jointly with the Company: the “Factorees”) executed with ING Commercial Finance Polska S.A. (the “Factor”) an Annex to the Reverse Factoring Agreement of April 29th 2021 (the “Annex to the Reverse Factoring Agreement”, and the “Reverse Factoring Agreement”).

As part of the amendments made by the Annex to the Reverse Factoring Agreement, the factoring limit has been increased from PLN 500m to PLN 800m (or its equivalent in EUR or USD).

The Factor’s claims under the Reverse Factoring Agreement are secured by a notarised statement of submission to enforcement made by the Company, for up to 120% of the Reverse Factoring Agreement amount as increased by the Annex to the Reverse Factoring Agreement.

Other material terms and conditions of the Reverse Factoring Agreement are presented in the Company’s Current Report No. 14/2021 of April 29th 2021.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the security of financing for the Grupa Azoty Group and its suppliers by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Annual General Meeting of the Company convened for June 29th 2022, relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes an Annual General Meeting of the Company for June 29th 2022, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Par. 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 13/2022 of May 20th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on May 26th 2022 the Company’s Supervisory Board gave a favourable opinion on the proposal of the Company’s Management Board to allocate the entire net profit earned by the Company in 2021, in the amount of PLN 191,789,688.13, to the Company’s statutory reserve funds, and a favourable opinion on the Management Board’s recommendation to the Annual General Meeting to allocate the entire net profit earned by the Company in 2021 to the Company’s statutory reserve funds.

A final decision on the appropriation of the 2021 profit will be made by the Annual General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on May 20th 2022 its Management Board passed a resolution to recommend that the Company’s entire net profit for the financial year 2021, of PLN 191,789,688.13 (one hundred and ninety one million, seven hundred and eighty nine thousand, six hundred and eighty eight złoty 13/100) be allocated to the Company’s statutory reserve funds.

In 2021, the Company and its subsidiaries completed the development of the “Azoty Group Strategy for 2021-2030”. The Strategy aims to implement the mission and vision of the Grupa Azoty Group (the “Group”), according to which the Group is to manufacture fertilizers, plastics and chemical products in harmony with the environment, improve the well-being of people living in Europe and actively contribute to building the continent’s food security, as a supplier of effective solutions and reliable manufacturer of fertilizers, plastics and green chemistry.

The Strategy envisages further pursuit of the ongoing investment projects, in particular the development of the new business segment of Polyolefins through the implementation of the Polimery Police project, and also commencement of further important projects, relating especially to the climate and energy transition aimed at lowering environmentally harmful emissions through reduced consumption of coal, decarbonisation, and development of RES and zero-carbon sources.  These goals are to be achieved primarily through the “Green Azoty” project, which provides for diversification of feedstocks towards green sources, ESG strategy implementation and reporting, implementation of RES solutions, efforts aimed at decarbonisation and reduction of environmentally harmful emissions, as well as implementation of research and development work in line with the principles of the European Green Deal. Under the Green Azoty project, capital expenditure of approximately PLN 2.7 billion is planned to be spent on green and decarbonisation projects until 2030. The implementation of the Green Azoty project will result in a reduction of CO₂ emissions from in-house energy generation by over one third and of coal consumption by almost two thirds by 2030 relative to the current levels, translating into a decrease of over 800,000 tonnes annually in carbon emissions from the Group’s production units.

In view of the above, the Management Board recommends that the entire net profit for 2021 be retained by the Company. By retaining earnings, the Company will secure financing for the implementation of its planned investment projects, with particular focus on those related to energy transition.

In order to implement the resolution, the Management Board will request the Supervisory Board to assess the proposal and the General Meeting to decide on the allocation of net profit for the financial year 2021.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial results of the Grupa Azoty Group for the first quarter of 2022.

Comments on the results for the first quarter of 2022

In the first quarter of 2022, the Grupa Azoty Group generated consolidated revenue of PLN 6,827m, EBITDA of PLN 1,335m and EBITDA margin of 19.6%.

All business segments delivered positive EBITDA figures in the first quarter od 2022.

The Agro Segment made the largest contribution to the Group’s EBITDA for the quarter. The Group’sperformance mainly benefited from significantly higher prices of chemicals, fertilizers and plastics. The factors with a negative effect on the Group’s results in the period included lower sales volumes and higher prices of raw materials. The first quarter of 2022 is another period marked by continued imbalance between supply and demand in the markets caused by the post-pandemic economic recovery, additionally exacerbated by Russia’s war on Ukraine.

Main performance drivers in the key segments:

Agro

The Agro Segment recorded higher prices of all raw materials and feedstocks used in production (including a nearly five-fold increase of the price of natural gas), leading to higher prices of fertilizer products. The prices of both raw materials and products were affected by the economic situation in Europe in the wake of Russia’s invasion of Ukraine, which had an adverse effect on the balance of supply and demand, especially as regards raw materials, materially reducing the availability of products on the market in the peak of the fertilizer application season. The Group’s sales volumes fell, largely as a consequence of lower output of compound fertilizers due to the failure of power steam generators at the Company’s subsidiary Grupa Azoty Zakłady Chemiczne Police S.A. (“Grupa Azoty Police”). On a consolidated basis, these negative financial consequences were mitigated by measures taken to enable the use, while the failure lasted, of some of Grupa Azoty Police’s commodities contracted at prices lower than spot prices paid by the other Group companies. The Agro Segment’s significant share in the Group’s consolidated results is attributable to the seasonality of mineral fertilizers’ application and growing demand for fertilizers applied in spring, observed in the first quarter of each year. The Agro segment was also affected by restrictions on imports of fertilizers manufactured in Russia, as a result of the sanctions introduced following the launch of Russia’s assault on Ukraine, as well as by reduced fertilizer ouput by European competitors.

In the first quarter of 2022, in view of production shutdowns at European producers and the soaring price of the main feedstock (natural gas), the key to the strong performance of the Agro segment was the strategy to maximise the Group’s nitrogen fertilizer output while maintaining product prices at one of the lowest levels in the European Union.

In the first quarter of 2022, the Agro Segment delivered an EBITDA margin of 19.3%, compared with 12.4% in the corresponding period of the previous year.

Chemicals

The Chemicals Segment recorded a rise in prices of products and raw materials used in their production. The growth rate of the segment’s product prices was the largest in the case of NOXy, melamine, technical-grade urea and sulfur. The rapid increase of sulfur prices is a consequence of higher crude oil prices and logistical problems associated with Russian ports and constraints in deliveries made via Black Sea ports. In the case of melamine, high prices are driven by rising prices of natural gas, just like in the case of NOXy prices. The prices of technical-grade urea were also in an upward trend and Russia’sinvasion of Ukraine raised concerns of supply disruptions. Sales volumes in almost each of the segment’s product groups were lower.

In the first quarter of 2022, the Chemicals Segment reported a strong year-on-year increase in EBITDA. The EBITDA margin rose from 9.9% in the first quarter of 2021 to 21.0% in the first quarter of 2022.

Plastics

The Plastics Segment saw higher prices of raw materials (benzene, phenol) and products. The sales volumes of the segment’s key product – natural polyamide – grew year on year. Demand from target application markets was good, except for the automotive sector’s continuing problems with the availability of microprocessors, resulting in production stoppages at automotive plants in Europe. The situation was aggravated by Russia’s invasion of Ukraine, leading to production stoppage by automotive companies in Russia and a marked decline in the availability of components from eastern directions.

The segment’s EBITDA margin for the period reached 10.9%, which means an over twofold improvement compared with the corresponding period of the previous year, when it stood at 4.1%.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for the first quarter of 2022, scheduled to be published on May 25th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that the full-year report of the Company for 2021 and the consolidated full-year report of the Company’s Group for 2021 have been supplemented with the document “Management Board Representation 2021” attached to this Current Report, replacing the documents “Management Representation SFS GA Tarnów 2021” and “Management Representation CFS GA Tarnów 2021”, which were attached by mistake.

The information and financial data contained in the full-year reports issued by the Company on April 27th 2022 remains unchanged.

Legal basis: Par. 15.4 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Report No. 12/2021 of April 17th 2021 regarding dismissal by the Regional Court in Kraków, 9th Commercial Division, of a Shareholder’s claim to repeal Resolution No. 5 of the Extraordinary General Meeting of Grupa Azoty S.A. (the “Company”) of August 20th 2022 to approve certain legal transactions that may result in the disposal of current assets of the Company, the Management Board of the Company announces that on April 28th 2022 the Court of Appeals in Kraków passed a judgment dismissing the Shareholder’s appeal, thus upholding the decision on the merits issued by the court of first instance.

The judgment is final.

Legal basis: Par. 19.1.10 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 12/2022 of April 8th 2022 issued by the Company’s subsidiary Grupa Azoty Zakłady Chemiczne Police S.A. (“GA Police”) to report completion of the repair of the equipment failure announced by GA Police in Current Report No. 6/2022 of March 9th 2022, Current Report No. 7/2022 of March 21st 2022 and Current Report No. 8/2022 of March 25th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that the adverse financial effect of the failure for the Company’s Group is estimated at PLN 34.2m.

The adverse financial effect of the equipment failures comprises repair costs and lost profits on sales of compound fertilizers, titanium white and nitrogen products (urea and urea solutions and ammonia), which would have likely been realised under normal operation.

At the consolidated level, the financial effect of the equipment failure was reduced through measures taken to enable utilisation of some of GA Police’s energy resources by other Group companies for the duration of the failure.

The amounts presented above are estimates and may be subject to change.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimates of selected consolidated financial results of the Grupa Azoty Group for the fourth quarter of 2021 and for the whole of 2021.

Comments on the results for the fourth quarter of 2021

In the fourth quarter of 2021, the Grupa Azoty Group generated consolidated revenue of PLN 5,484m and EBITDA of PLN 887m, with EBITDA margin at 16.2%.

All key business segments delivered positive EBITDA in the period and reported year-on-year improvement, reflecting strong demand for plastics and chemical products.

The largest contributor to the Grupa Azoty Group’s consolidated EBITDA for the fourth quarter of 2021 was the Chemicals segment, which reported the best performance in its history. Its contribution to the consolidated EBITDA for the fourth quarter of 2021 grew to 43.3%, from 19.7% in the fourth quarter of 2020. The Plastics segment also increased its contribution to the consolidated EBITDA, from 1.3% to 7.9%, while the share of Agro Fertilizers fell to 40.0%, compared with 52.5% in the same period of the previous year.

The fourth quarter of 2021 saw an uptrend in the selling prices of fertilizers, fuelled by a rapid and very strong price growth for the key raw materials used in fertilizer production, especially natural gas, but also phosphate rock and potassium salt, which brought about an unprecedented surge in production costs.

The Company’s subsidiary, Grupa Azoty Zakłady Azotowe Puławy S.A., recognised an impairment loss on non-current assets in the Plastics segment, and on April 1st 2022 the Company announced its effect on the consolidated financial statements for 2021, i.e. a decrease of PLN 288m in the Group's consolidated operating profit.  In accordance with the Grupa Azoty Group’s accounting policy, the recognition of impairment, which is a non-cash item, had no impact on the Company's consolidated EBITDA.

Main performance drivers in the key segments:

Agro Fertilizers

The performance of the Fertilizer-Agro Segment was driven by high prices of raw materials, in particular natural gas (the key feedstock in the production of fertilizers), which rose by over 400% year on year. Increased selling prices in all fertilizers groups had a positive effect on the segment’s results, despite a decline in sales volumes, in particular in the case of compound fertilizers.

The increased fertilizer prices resulted from higher production costs and reflected the pricing trends seen among other European producers. Thanks to the measures taken by Grupa Azoty to secure supplies to satisfy fertilizer demand on the domestic market, fertilizer prices in Poland in the fourth quarter of 2021 were among the lowest in the European Union.

In the fourth quarter, the Grupa Azoty Group did not stop or limit fertilizer production at its plants.

With a significant growth of raw material costs, EBITDA margin in the Agro Fertilizers segment was 11.8%, compared with 10.5% the year before.

Chemicals

High price growth dynamics were seen in all product groups in the Chemicals segment, with the strongest rise reported for melamine, technical-grade urea and NOXy. The segment's performance benefited from improved sales volumes and increased product price levels, which more than offset a negative impact of higher raw material prices.

As a result, the Chemicals segment reported a strong year-on-year improvement in EBITDA in the fourth quarter of 2021 , resulting in a more than twofold growth of EBITDA margin, from 9.1% in the fourth quarter of 2020 to 21.1% in the fourth quarter of 2021.

Plastics

A key development with the largest positive effect on the Plastics segment's performance in the fourth quarter of 2021 was higher caprolactam and polyamide prices. The period saw a decline in demand from the key consumer of plastics, i.e. the automotive sector, but it was offset by continuing strong demand from other sectors. Two negative drivers of the segment's results in the period were lower sales volumes and high raw material prices, mainly for benzene and phenol.

However, the Plastics segment felt the economic recovery in the fourth quarter 2021:  its EBITDA margin for the period reached 14.5%, which means an over tenfold improvement compared with the corresponding period of the previous year, when it stood at 1.3%.

Key performance drivers in 2021:

The key development driving the Grupa Azoty Group’s performance in 2021 was growing prices of raw materials and products. A steady economic recovery was seen during the year as the impact of the COVID-19 pandemic was lessening. At the same time, demand-supply imbalances were apparent as a result of supply chain disruptions in the raw material and product markets.

In 2021, Grupa Azoty generated consolidated revenue of PLN 15,901m (2020: PLN 10,525m) and EBITDA of PLN 1,953m (2020: PLN 1,323m), with EBITDA margin at 12.3%(2020: 12.6%).

The Group’s performance improved as a result of business diversification, with nearly half of the EBITDA figure coming from the Chemicals and Plastics segments. In the key Agro Fertilizers segment, the gas price surge to historic highs brought down EBITDA and EBITDA margin by 6.0% and 4.1 pp, respectively.

The amounts presented above are estimates and may be subject to change. The final figures will be presented in the consolidated report for 2021, which is scheduled to be published on April 27th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, L 173/1 as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces the expected effect of a one-off non-cash item on the Company’s consolidated financial statements for 2021.

Further to Current Report No. 5/2022 issued on April 1st 2022 by the Company’s subsidiary Grupa Azoty Zakłady Azotowe Puławy S.A. “Grupa Azoty Puławy”) regarding Grupa Azoty Puławy’s decision ofApril 1st 2022 to recognise an impairment loss of PLN 264m that was based on the results of an impairment test of non-current assets of the cash generating unit (CGU) Plastics, the Company announces that the event will affect the Company’s consolidated financial statements for 2021 and reduce its consolidated operating profit or loss by PLN 288m.

The impairment loss is a non-cash item and has no impact on the liquidity position of the Company or its Group.

As the audit of the Company’s financial statements for 2021 has not yet been completed, the amount is not final and may be subject to change. The annual report of the Company will be issued on April 27th 2022.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 19/2021 issued on May 31st 2021, the Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on March 31st 2022 it executed, together with the Company subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (together with the Company: the “Factorees”), an annex to the supply financing agreement of May 31st 2021 (the “Annex to the Reverse Factoring Agreement”, the “Reverse Factoring Agreement”) signed with Pekao Faktoring Sp. z o.o. (the “Factor”).

The amendments introduced by the Annex to the Reverse Factoring Agreement include an increase of the facility amount from PLN 250m to PLN 550m (or its equivalent in EUR or USD), extension of the availability period of the Reverse Factoring Agreement amount until November 30th 2022, replacement of the LIBOR 1M reference rate for financing in USD with the CME Term SOFR 1M rate, and establishment of the supplier financing option until the payment deadline.

Security for the Factor’s claims required under the Reverse Factoring Agreement is the Company’s notarised declaration of submission to enforcement for up to 120% of the Reverse Factoring Agreement amount increased by the Annex to the Reverse Factoring Agreement.

Other material terms and conditions of the Reverse Factoring Agreement are presented in the Company’s Current Report No. 19/2021 of May 31st 2021.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the security of financing for the Grupa Azoty Group and its suppliers by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement as clients.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 15/2021 issued on April 29th 2021, the Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on March 31st 2022 it executed, together with the Company subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (together with the Company: the “Factorees”), an annex to the payment services and financing agreement of April 29th 2021 (the “Annex to the Reverse Factoring Agreement”, the “Reverse Factoring Agreement”) signed with CaixaBank S.A. Polish Branch.

The amendments introduced by the Annex to the Reverse Factoring Agreement include an increase of the facility amount from PLN 500m to PLN 800m (or its equivalent in EUR or USD), extension of the availability period of the Reverse Factoring Agreement amount until April 29th 2023, change of the Bank’s margins on the financing in PLN and USD in accordance with the standards adopted in other agreements of this type, and establishment of the supplier financing option until the payment deadline using the split payment mechanism.

The Bank’s claims under the Reverse Factoring Agreement are secured by a notarised statement of submission to enforcement made by the Company, for up to 120% of the Reverse Factoring Agreement amount increased by the Annex to the Reverse Factoring Agreement.

Other material terms and conditions of the Reverse Factoring Agreement are presented in the Company’s Current Report No. 15/2021 of April 29th 2021.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the security of financing for the Group and its suppliers by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement as clients.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) has identified potential risks that may have a significant impact on future financial performance of the Company and its Group (the “Grupa Azoty Group” or the “Group”) in the wake of the Russian invasion of Ukraine:

1. Potential risk of disruption in natural gas supply to Grupa Azoty Group companies.

Natural gas is supplied to the Group under an agreement with Polskie Górnictwo Naftowe i Gazownictwo S.A. and, for the time being, the supply is continuing without any disruption. The Grupa Azoty Group keeps monitoring the gas supply situation and preparing contingency plans in case it has to reduce production in response to any supply constraints. The situation may change depending on decisions taken by the fuel supplier and the operator of the Polish gas transmission network.

2. Risk associated with the prices and availability of strategic raw materials supplied from the territory of Ukraine, as well as from the countries on which the sanction regime has been imposed – Russia and Belarus.

This risk, concerning the supplies of propylene and potassium chloride, may materialise as a result of reduced availability, price rises or logistical issues.

Possible disruptions may also affect the availability of other raw materials, but as at the date of this report the Company has not identified any material risks that could affect its ability to procure supplies from alternative sources.

3. Potential risk to timely implementation of projects carried out at the Grupa Azoty Group due to possible issues related to unavailability or constrained availability of contractor staff following the general mobilisation order in Ukraine.

4. Increased risk of interest rate rises and depreciation of the Polish currency against the euro and US dollar sparked by the current economic turbulence.

In 2021 sales to Ukraine accounted for 2.2% of the Grupa Azoty Group’s consolidated revenue and were mainly sales of mineral fertilizers. Sales to the Russian and Belarusian markets did not exceed 1% of the Group’s consolidated revenue.

The Group is not currently selling any products to Russia or Belarus.

As for supplies to the Ukrainian market, they have been significantly curtailed since the martial law was declared in Ukraine.

The Grupa Azoty Management Board is monitoring the political and economic situation in the wake of the Russian invasion of Ukraine, analysing its impact on the business of the Company and the Group.

If any new developments with a potentially significant impact on the Grupa Azoty Group’s financial performance and economic standing are identified, they will be promptly disclosed to the public.

Legal basis: Article 17(1) of MAR (Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 1/2022 of January 25th 2022, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on January 28th 2022 Grupa Azoty Polyolefins S.A., a subsidiary of the Company (the “Subsidiary”), executed Annex 3 to amend the turnkey engineering, procurement and construction contract for the Polimery Police project of May 11th 2019 ( the “EPC Contract”) (see Current Report No. 28/2019 of May 11th 2019) between the Subsidiary and Hyundai Engineering Co., Ltd. (the “Contractor”).

Annex 3 provides for, among others:

• a EUR 72.48m increase in the Contractor’s fee,
• a six-month extension of the time limit to complete the Polimery Police project, and
• an amendment of the appendix to the EPC Contract relating to the scope of work under the EPC Contract.

The execution of Annex 3 will not cause the budget of the Polimery Police project (amounting to USD 1,837,998 million) to be exceeded as the increase in the Contractor’s fee will be financed from the project contingency reserve.

The Company’s Management Board also announces that the condition necessary for execution of Annex 3 to the EPC Contract, specified in Current Report No. 1/2022 of January 25th 2022, i.e., obtaining the consent of the Subsidiary’s General Meeting on January 28th 2022, has been fulfilled.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Grupa Azoty S.A. (the “Company”) will announce its 2021 full-year results and 2022 interim results as per the following schedule:

1. First and third quarter interim results:

• Q1 2022 complete consolidated report – May 25th 2022
• Q3 2022 complete consolidated report – November 9th 2022

2. Half-year interim results:

• H1 2022 complete consolidated report – September 7th 2022

3. Full-year results:

• 2021 separate full-year report – April 27th 2022
• 2021 consolidated full-year report – April 27th 2022

The 2021 consolidated report on payments to governments will be released on April 27th 2022.

Furthermore, the Company announces that no separate quarterly results will be published by the Company, as permitted under Par. 62.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757) (the “Regulation”). The consolidated quarterly reports will incorporate quarterly condensed consolidated financial statements and quarterly financial information.

Also, the Company will not publish a separate (non-consolidated) half-year report, as permitted under Par. 62.3 of the Regulation.

Further, the Company will not publish separate or consolidated quarterly results for Q4 2021 and Q2 2022, as permitted under Par. 79.2 of the Regulation.

Legal basis: Par. 80.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on January 25th 2022 a resolution was passed by the Management Board of Grupa Azoty Polyolefins S.A., a member company of the Grupa Azoty Group (the “Subsidiary”), concerning conditional conclusion of an annex to amend the turnkey engineering, procurement and construction contract for the Polimery Police project of May 11th 2019 (the “EPC Contract”) (see Current Report No. 28/2019 of May 11th 2019) between the Subsidiary and Hyundai Engineering Co., Ltd. (the “Contractor”).

Following a formal review and assessment of the substance of the Proposed Amendments, the Management Board of the Subsidiary decided to accept the terms agreed between the Subsidiary and the Contractor and conclude Annex 3 to the EPC Contract (“Annex 3”).

The Proposed Amendments were communicated by the Company in Current Reports No. 29/2021 of August 27th 2021, No. 36/2021 of November 10th 2021, and No. 40/2021 of November 16th 2021.

Among other things, Annex 3 provides for:

• a EUR 72.48m increase in the Contractor’s fee,
• a six-month extension of the time limit to complete the Polimery Police project, and
• an amendment of an appendix to the EPC Contract where it relates to the scope of work under the EPC Contract.

The conclusion of Annex 3 will not cause the budget of the Polimery Police project to be exceeded as the increase in the Contractor’s fee will be financed from the project contingency reserve.

The Management Board of the Company points out that Annex 3 is a conditional agreement, subject to the grant of relevant approvals by the Subsidiary’s corporate bodies.

The proposal to be submitted to the General Meeting of the Subsidiary was endorsed by its Supervisory Board on January 25th 2022.

Further steps related to the conclusion of Annex 3 will be announced by the Company in separate current reports.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 17(1) of MAR – Inside information

Further to Current Report No. 7/2018 of March 12th 2020 and Current Report No. 59/2020 of December 29th 2020, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 20th 2021 the Companyand its subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (jointly the “Consumers”) signed with Polska Grupa Górnicza S.A. of Katowice (“Seller”) bilateral amendment agreements (the “Amendment Agreements”) to coal sale contracts (the “Contracts”).

Under the Amendment Agreements:

• the notices to terminate the Contracts as submitted by the Company and the other Consumers on December 29th 2020 have been effectively revoked,
• coal volumes will be reduced in a flexible manner over the remaining terms of the Contracts, which is consistent with the Grupa Azoty Group's strategy for 2021−2030 with respect to decarbonising power generation.

The subject matter of the Contracts is the sale of thermal coal produced at the Seller’s mines and intended for consumption at the Customers in quantities specified in the respective Contracts, based on uniform business terms for the Customers. The total estimated value of all the Contracts following the execution of the Amendment Agreements is approximately PLN 202.7m (VAT exclusive) per annum.

The Contracts will continue to be considered material to the Company given that the Seller is a strategic supplier of thermal coal to Grupa Azoty, and the Contracts will satisfy a material portion of demand for such coal; in particular, they will cover total demand from Grupa Azoty Zakłady Chemiczne Police S.A and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., as well as up to 90% of demand from Grupa Azoty S.A. They will also supplement up to about 10% of Grupa Azoty Zakady Azotowe Puławy's demand not covered by other contracts.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on December 1st 2021 it was notified that Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., a subsidiary of the Company, had entered into a propylene purchase contract (the “Contract”) with KNC Trading SA of Geneva, Switzerland.

The Contract has been concluded for a definite term from October 1st 2021 to December 31st 2025. The value of the Contract in this period is estimated at EUR 505m (i.e. approximately PLN 2.38bn at the mid exchange rate quoted by the National Bank of Poland on the date of the Contract). Deliveries of the contracted propylene are to be made according to an agreed schedule and on agreed commercial terms.

The terms and conditions of the Contract do not differ from standard terms and conditions used in contracts of this type, including with respect to liquidated damages.

Information on the execution of the Contract has been classified as inside information by the Company as it refers to securing long-term supplies of propylene, a key feedstock used in the OXO business of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended) (MAR).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Acting pursuant to Article 428.5 of the Commercial Companies Code, the Management Board of Grupa Azoty S.A. (the “Company”) presents, attached to this Current Report, its answers to the questions asked by a shareholder under Article 428.1 of the Commercial Companies Code during the Extraordinary General Meeting of November 15th 2021.

Legal basis: Par. 19.1.12 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 16th 2021 the general contractor for the Polimery Police project, Hyundai Engineering Co., Ltd. (“HEC”), submitted to Grupa Azoty Polyolefins S.A., a company of the Grupa Azoty Group (the “Subsidiary”) a supplement (the “Supplement”) to the letter of August 27th 2021, as reported by the Company in Current Report No. 29/2021 of August 27th 2021, concerning the initiation of a procedure to amend the engineering, procurement and construction contract for the Polimery Police project of May 11th 2019 (the “Polimery Police Project”) (the “EPC Contract”).

In accordance with the Supplement, HEC proposed the following additional amendments: (1) to extend the Polimery Police Project timescale by a further 15 days and (2) to increase the sum payable under the EPC Contract by an additional EUR 12.7m.

The reason for submitting the Supplement according to HEC is the impact of the COVID-19 pandemic on the execution of the Polimery Police Project.

The Supplement will be thoroughly reviewed and assessed in terms of its appropriateness under the EPC Contract and under other agreements between the Subsidiary and HEC, as well as in the light of relevant facts. Following the review, a decision will be made whether or not to include the amendments to the EPC Contract requested in the Supplement within the scope of the ongoing negotiating process.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Extraordinary General Meeting held on November 15th 2021, specifying the number of voting rights conferred by the shares held by each shareholder, and their percentage share in the voting rights represented at the Annual General Meeting and in total voting rights.   

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2021, item 1983)

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Extraordinary General Meeting on November 15th 2021, together with the results of voting on the resolutions.

The documents voted on by the Extraordinary General Meeting are available on the Company’s website at http://tarnow.grupaazoty.com/pl/relacje/walne.html and attached to Current Report No. 31/2021 of October 15th 2021.

In connection with the use of a computer system for voting and counting the votes, the Extraordinary General Meeting decided not to appoint a Ballot Counting Committee.

The Extraordinary General Meeting did not leave any items of the planned agenda unaddressed. During the Extraordinary General Meeting, no objections were raised to be recorded in the minutes.

Legal basis: Par. 19.1.6 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on November 15th 2021, by Resolution No. 5 of the Extraordinary General Meeting, Mr Janusz Podsiadło was appointed to the Company’s Supervisory Board of the 11th term of office.

The resolution became effective upon adoption.

Mr Janusz Podsiadło was appointed to the Company’s Supervisory Board following a by-election held to appoint a member to the Supervisory Board of the 11th term of office from among persons elected by the Company’s employees.

The Management Board further announces that the new member of the Supervisory Board Janusz Podsiadło made a representation to the effect that he is not engaged in any activities competing with the Company’s business, nor is he a partner in any competing partnership under civil law or any other type of partnership, a shareholder in any competing incorporated company or a member of a governing body of any other competing legal entity.

The representation received by the Company includes a statement to the effect that the new Member of the Supervisory Board is not entered in the Register of Insolvent Debtors maintained pursuant to the Act on the National Court Register.

Legal basis: Par. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 29/2021 of August 27th 2021, the Management Board of Grupa Azoty S.A. (the“Company”) announces that upon completion of the formal and substantive assessment of the amendments proposed by Hyundai Engineering Co., Ltd (the “General Contractor”) to the engineering, procurement and construction contract for the Polimery Police project, dated May 11th 2019 (the “EPC Contract”), the Management Board of Grupa Azoty Polyolefins S.A., a member of the Company’s Group (the “Subsidiary”), resolved on November 10th 2021 to approve the instructions and strategy for negotiations with the General Contractor, whereby the Subsidiary will proceed to negotiating the proposed amendments to the EPC Contract.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

Further to Current Reports No. 30/2021 and No. 31/2021 of October 15th 2021, the Management Board of Grupa Azoty S.A. (the “Company”), in connection with the Extraordinary General Meeting to be held on November 15th 2021 (the “EGM”) and the release on October 28th 2021 of the Grupa Azoty Strategy for 2021−2030, publishes, attached hereto, the updated statement of compliance by the Company with the principles of the Best Practice for WSE Listed Companies 2021 (item 8 of the proposed agenda of the EGM).

The document will be published on the Company’s website as part of the materials concerning the matters to be discussed by the Extraordinary General Meeting convened for November 15th 2021.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on October 28th 2021 the Management Board adopted and the Supervisory Board approved the Grupa Azoty Strategy for 2021–2030 (the “Strategy”).

The new Strategy is our response to the major challenges faced by today’s industry from the perspective of one of the leading players in the fertilizer and chemical sector in Europe and highlights sustainable development and corporate social responsibility as areas of strategic importance to Grupa Azoty.

Grupa Azoty’s Mission, Vision and Values until 2030

By 2030, Grupa Azoty will become an effective, flexible, integrated and division-based Group with a production-focused business in Europe.

Mission 2030
In harmony with the environment, we manufacture fertilizers, plastics and chemical products.

We improve the well-being of people who live in Europe and actively contribute to building our continent’s food security.

Vision 2030
Grupa Azoty is a supplier of effective solutions and a reliable manufacturer of fertilizers, plastics and green chemical products

Defining a new mission and vision and presenting the values, objectives and plans until 2030, the Strategy identifies the following elements:

• Management strategy based on Business Segments (AGRO, Plastics – PA, Plastics – Polyolefins, Pigments, Tech Grade Urea, and Oxoplast)
• Financial strategy
• ESG strategy
• Feedstock strategy
• Innovation strategy
• Operational excellence strategy

The Strategy addresses the challenges posed before today’s industry by the European Green Deal. Specific initiatives, including those focused on environmentally friendly captive energy generation, the need to reduce emissions and decarbonise the business, are presented by the Company in ‘Green Azoty’, our strategic corporate project, based around three pillars:

• Green products
• Green technologies
• Green organisation

 Management strategy based on Business Segments

Grupa Azoty’s activity until 2030 will focus on Business Segments defined within the three key business areas of AGRO, PLASTICS and CHEMICALS. The new organisational model will help maximise synergies through integration of selected support functions and implementation of a management system based on key Business Segments. Key development directions defined for the individual Business Segments will be part of the ‘Green Azoty’ strategic project.

AGRO

Grupa Azoty’s priority in the AGRO Segment will be to strengthen its position as a leader in fertilizer production and sales through portfolio expansion. By 2030, the Group will be perceived not only as a supplier of fertilizers, but also as a supplier of end-to-end fertilization systems. Grupa Azoty will seek to develop a comprehensive system of services dedicated to individual crops, comprising products supplied by the Group, from key macronutrients to micronutrients. The AGRO Segment’s offering will be developed in parallel with the ‘Farm to Fork’ strategy, which prioritises sustainable agriculture.

 Plastics

As part of the PLASTICS – POLYAMIDE (PA) Segment, as an environmentally friendly manufacturer, Grupa Azoty will take steps to reduce the consumption of energy and raw materials and to expand its product portfolio in line with the circular economy concept.

Plastic products to be included in the Group’s mix will also be made from recycled plastics, sourced internally from Grupa Azoty’s own process units and from external suppliers.

In the POLYOLEFINS Segment, Grupa Azoty is implementing one of the largest capital investment projects in the European chemical industry, expected to position Poland among Europe’s leaders in polypropylene production. The purpose of the project is to construct an integrated chemical complex that would comprise a propane dehydrogenation (PDH) unit, polypropylene production unit, offshore gas terminal with logistics infrastructure, and auxiliary facilities and interconnections. Within the period covered by the 2030 Strategy, Grupa Azoty expects to complete the project and reach the full polypropylene production capacity.

Chemicals

The strategic priority in the TECH GRADE UREA segment will be to maintain a leading position in the sales of the segment’s products on the domestic market, implement initiatives geared towards operational excellence and keep aligning the portfolio with market needs.

The priority in the PIGMENTS segment will be to maintain customer trust and recognition of the Grupa Azoty brand, and to make timely deliveries of prime quality products.

In the OXOPLAST segment, exposure to changes in the regulatory framework, especially those pertaining to plasticizers, encourages Grupa Azoty to keep monitoring market needs on an ongoing basis, planning changes and taking appropriate steps to adjust its product portfolio.

Strategic business area – Energy

The primary objective of the Energy Segment is and will be to support Grupa Azoty’s core business by providing energy carriers powering its chemical processes and by supporting value creation areas while seeking to decarbonise the generation sources. As greenhouse gas emissions from energy generation account for approximately a half of Grupa Azoty’s total emissions, it is necessary to take steps to transform in-house heat and power generation, reduce energy consumption and improve the energy efficiency of chemical units.

Grupa Azoty’s key objectives in the Strategic Business Area – Energy:

- diversification of energy sources, followed by gradual phase-out of coal in favour of natural gas and renewables as alternative green sources in order to reduce the organisation’s carbon footprint,

- maximising synergies between energy generation and chemical processes, e.g. in the area of energy generation from steam created by chemical units,

- reduction of unit energy consumption rates, including 30% reduction of the energy intensity of the SMR process by 2024,

- implementing new technology solutions,

- aligning Group companies’ energy installations with the BAT conclusions.

The ‘Green Azoty’ strategic corporate project as the cornerstone of Grupa Azoty’s ESG Strategy

Grupa Azoty’s new business Strategy is driven by the energy transition to address climate change. Regulatory changes are seen as an opportunity to take action aimed at cutting harmful environmental emissions through reduced coal consumption, decarbonisation and development of renewable and zero carbon energy sources. Action taken by Grupa Azoty will mark the first step towards achieving carbon neutrality by 2050. Grupa Azoty’s objective is to cut the share of electricity from burning coal to less than 50% of total energy consumed in 2030.

Decarbonisation programme

Grupa Azoty understands the gravity of climate change and environmental degradation, which present a major threat to the modern world. Being an important player of the chemical industry, which is a source of large amounts of greenhouse gas emissions for reasons inherently related to the technologies employed, Grupa Azoty feels responsibility for slowing down the pace of the unfolding climate change.

Within the coming decade, Grupa Azoty is set to implement its own decarbonisation programme. Planned decarbonisation projects will allow Grupa Azoty to reduce its estimated CO₂ emissions by over 800 thousand tonnes in 2030 compared with 2020.

Planned emission reduction rates in 2030 relative to 2020:

- 34% reduction in CO₂ emissions from in-house energy generation

- 51% reduction in CO₂ emissions from purchased electricity generation

- 65% reduction in coal consumption at Grupa Azoty

Planned capex on green and decarbonisation projects, including renewable energy projects, will be approximately PLN 2.7bn until 2030.

Grupa Azoty as a green energy producer

By 2030, Grupa Azoty will seek to implement technological solutions harnessing renewable energy, including solar PV, wind, biomass and waste heat from process units. These investments and upgrades will enable Grupa Azoty to achieve the status of a renewable energy producer.

The key strategic plans assume a 40% share of renewables in electricity generation mix of Grupa Azoty by 2030. The share of renewable energy sources in energy generation capex is assumed at 17.3%.

Actively participating in the development of Poland’s hydrogen market

The largest hydrogen producer in Poland and a major one in Europe, Grupa Azoty plans to actively engage in advancing the hydrogen market over the coming years and to participate in the delivery of the EU Hydrogen Strategy. As a member of the European Clean Hydrogen Alliance, in the coming years Grupa Azoty will take active part in the work to develop EU regulations that will classify hydrogen as a green fuel. In the period covered by the Strategy, Grupa Azoty will focus on research and development related to the production and application of green hydrogen.

Implementing R&D projects aligned with objectives of the European Green Deal

A significant part of Grupa Azoty’s research and development resources will be geared towards achieving climate targets. New R&D projects will focus on development in the areas of fertilizers, hydrogen, electric mobility, biodegradable plastics, circular economy, and carbon sequestration.

By 2024, Grupa Azoty plans to conduct studies to assess the feasibility of an SMR nuclear power plant project, which could help stabilise the energy mix dominated by renewables and ensure competitive energy pricing.

Financial strategy

A key strategic goal of Grupa Azoty in the area of finance is continued consolidation of its finance function to actively support management of the Grupa Azoty Group at the level of individual Business Segments.

The financing structure will be tailored to the needs and capabilities of the Grupa Azoty Group, enabling the execution of key capex projects. The main purpose of the financing structure is to provide short- and long-term sources of finance on competitive terms and in amounts sufficient to fund day-to-day operations, capex programmes and potential acquisitions.

The key financial goals include delivering an EBITDA margin of more than 16% by 2030 and achieving the net debt to EBITDA ratio below 3.0 by 2025.

The dividend policy of Grupa Azoty S.A. provides for continued ability to pay dividends once the strategic capex programme (including projects driving climate transition of the Grupa Azoty Group) has been completed, at a level above 40% of consolidated net profit.

Delivery of the Strategy will require adequate, stable sources of funding. Given the significant pipeline of strategic projects (in particular Polimery Police), additional finance needs to be secured for new projects.

Green funding in the form of bonds or credit facilities will be relied on to finance energy transition projects of the Grupa Azoty Group. In the first place, such projects will involve solar PV and wind sources developed on own land and energy efficiency improvement of production processes.

Funds granted under the National Recovery Plan and other planned support measures are to finance capital projects with lower rates of return, necessary to enable technological transformation.

Corporate financing roll-over will involve extension or conclusion of new corporate financing agreements providing the Group with necessary funding until 2030.

ESG Strategy

Sustainable development will be the Group’s priority over the 2030 time horizon, pursued through initiatives seeking to further environmental protection, social good and responsible corporate governance. Initiatives previously undertaken in these areas will be included in Grupa Azoty’s ESG Strategy, organised around five pre-defined strategic pillars:

• climate and environment
• sustainable products
• sustainable supply chain
• immediate environment
• friendly and safe workplace

Grupa Azoty reduces its environmental impact and changes its energy mix by identifying and managing climate risks. It guarantees efficient, innovative and environmentally friendly production while striving to identify the carbon footprint of all its products. Grupa Azoty will expand its sustainable product portfolio by promoting efficient use of raw materials and constantly reducing energy consumption in its production processes.

Grupa Azoty increases its positive impact on the  social and economic environment, fosters relationships to educate and train future staff, expands the areas of social dialogue in keeping with the principle of Friendly Neighbourhood.

Grupa Azoty acts and expects its business partners to act in an ethical, socially responsible and environmentally sustainable manner. Grupa Azoty respects ethical codes and the principles of equality, following clear recruitment and promotion policies. It promotes diversity encompassing gender, education, age and professional experience with respect to all employees, applying the principles of equal treatment and non-discrimination.

Feedstock strategy

Given Grupa Azoty’s significant reliance on external suppliers, its key strategic objective in feedstocks is to ensure their secure and uninterrupted supplies, with intra-Group activities geared towards more efficient use of our own feedstock assets. The regulatory environment and our environmental stewardship will also play a vital role in shaping our procurement policy, which will be focused on increasing the share of green energy in Grupa Azoty’s energy mix and on gradually tightening control of the carbon footprint of externally sourced chemical raw materials.

Innovation strategy

Grupa Azoty perceives innovation-oriented projects as a remedy for regulatory changes and environmental trends as well as an opportunity to create competitive advantage. Exploration of the market with innovation in mind is done assuming specific rates of return, which facilitates continuous financial control of research projects. The research, development and innovation activities to be undertaken during the period covered by the Strategy will focus on developing the technologies applied and products offered by Grupa Azoty. Over the 2030 horizon, Grupa Azoty will focus on implementing innovation-oriented solutions within four areas: supporting corporate projects, developing an innovation system, innovation projects, and innovation geared towards minimising the impact of regulatory risks.

Planned R&D&I expenditure at Grupa Azoty in 2030 is estimated at 2%-3% of revenue. The profitability of the whole portfolio of new projects is assumed at IRR>15%.

Operational excellence strategy

Logistics

With goals of the European Green Deal in mind, logistic functions at Grupa Azoty will be adapted to enable delivery of the greenhouse gas emission reduction targets by advancing intermodal transport with a focus placed on environmentally friendly modes.

In the period covered by the Strategy, Grupa Azoty plans to further expand the sea port in Police and to develop the inland port in Kędzierzyn-Koźle. Also, its efforts seeking to exploit the potential of the Odra Waterway are to continue.

By 2030, Grupa Azoty plans to increase its cargo handling capacities by expanding the storage resources of Group companies, as part of which it wants to upgrade logistics of fertilizers and plastics, and by reducing the costs of using third-party storage facilities.

Capital assets management

The production asset management activities will seek to improve the energy efficiency of processes, e.g. by implementing new technology solutions, optimising management, modifying technologies to reduce energy consumption and diversifying energy sources towards natural gas and renewables.

IT

The priority in IT will be to achieve a uniform, coherent and integrated IT architecture and solutions for all Business Segments, which will help improve efficiency and service levels.

Details of the Strategy along with its assumptions regarding macroeconomic indicators can be found in the presentation attached to this current report.

The Management Board also announces that the Strategy presentation will be published on the Company’s website.

Legal basis: Article 17(1) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, estimated selected consolidated financial results of the Grupa Azoty Group for the third quarter and the first nine months of 2021.

Despite a significant increase in gas prices in the third quarter of 2021, the Grupa Azoty Group’s consolidated EBITDA grew on the back of business diversification.

Factors with an adverse effect on the results in the nine months to September 30th and in the third quarter of 2021 included mainly higher prices of raw materials (chiefly gas, but also propylene, phenol, benzene and phosphate rock), and higher costs of electricity and CO2 emission allowances.

The Group’s consolidated EBITDA in the aforementioned periods was boosted by high prices of most products in the key segments (Fertilizers, Chemicals and Plastics) as well as higher total sales volumes in the Chemicals and Plastics segments. At the same time, the Group’s consolidated EBITDA was positively impacted by a higher-than-expected allocation of free carbon allowances, which was recognised in the estimated accounting for emission costs for the first half of 2021.

Main factors with a bearing on the Group’s financial performance in the third quarter of 2021 compared with the third quarter of 2020:

1. In the Agro Fertilizers segment:

The segment’s performance was hurt by soaring gas prices. The segment’s results were also driven by a year-on-year increase in prices and sales volumes of nitrogen, compound and speciality fertilizers. As a result, the segment’s EBITDA contracted year on year. Prices of fertilizers grew as a consequence of higher production costs. Production cuts at leading manufacturers also played a part. Despite historically high prices of gas, the Company and its subsidiaries did not halt or significantly reduce their fertilizer production, taking steps to secure demand for fertilizers primarily on the domestic market, which is treated as a priority.

2. In the Chemicals segment:

The year-on-year improvement in the Chemicals segment’s performance was attributable to sharp rises in prices of all products, particularly of melamine, OXO alcohols, plasticizers and sulfur, driven by growing demand. Margins were adversely affected by higher prices of raw materials and slightly lower sales volumes.

3. In the Plastics segment:

The segment’s performance was mainly driven by a year-on-year increase in margins along the entire product chain (benzene/phenol – caprolactam – polyamide 6), resulting from higher demand from target application markets despite the continuing problems experienced by the automotive industry due to shortage of electronic components. In addition, in the third quarter of 2021 the Company discontinued its polyoxymethylene business (POM) business and sold some of the related assets, which benefited the segment’s performance.

The amounts presented above are estimates and may be subject to change. The final results will be presented in the consolidated report for the third quarter and the nine months ended September 30th 2021, to be issued on November 9th 2021.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on October 22nd 2021 the Company was notified that on the same day the District Court for Kraków-Śródmieście in Kraków, 12th Commercial Division of the National Court Register, registered amendments to the Company’s Articles of Association.

The registered amendments to the Articles of Association were approved by Resolution No. 33 of the Company’s Annual General Meeting held on June 30th 2021 and announced in Current Report No. 25/2021 of June 30th 2021.

On September 6th 2021, the Company’s Supervisory Board adopted the consolidated text of the Company’s Articles of Association, reflecting the amendments approved by Resolution No. 33 of the Annual General Meeting of June 30th 2021.

The consolidated text of the Articles of Association is attached as an appendix to this current report.

The amendments to the Articles of Association are presented in detail in the appendix to this current report.

Legal basis: Par. 5.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Extraordinary General Meeting of the Company convened for November 15th 2021, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Appendixes will be added.

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes an Extraordinary General Meeting of the Company for November 15th 2021, at 12:00 noon, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Par. 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that on August 27th 2021 Grupa Azoty Polyolefins S.A., member of the Company’s Group (the “Subsidiary”), received from Hyundai Engineering Co., Ltd. (the “Contractor”), the General Contractor under the contract for turnkey execution of the Polimery Police project of May 11th 2019 whose conclusion was announced by the Company in Current Report No. 28/2019 of May 11th 2019, as amended, including under an annex announced by the Company in Current Report No. 45/2020 of October 9th 2020 (the“EPC Contract”), a letter concerning initiation of a procedure to amend the EPC Contract (the “Amendment Proposal”) for the execution of the Polimery Police project (the “Polimery Police Project”).

The amendments to the EPC Contract proposed by the Contractor concern the following matters: (1) increase of the Contractor’s fee by a total of EUR 127.4m, (2) change of the Polimery Police Project execution schedule through extension of the Polimery Police Project execution period by 181 days, and (3) amendment to the EPC Contract’s appendix specifying, among others, the scope of work provided for in the EPC Contract. In the Contractor’s opinion, the reason for submitting the Amendment Proposal is in particular the impact of the COVID-19 pandemic on the execution of the Polimery Police Project.

The Amendment Proposal will be thoroughly reviewed and verified in terms of its appropriateness under the EPC Contract, in accordance with the procedure provided for in the EPC Contract, and under other agreements between the Subsidiary and the Contractor, as well as in the light of facts.

Further steps related to the Amendment Proposal will be announced by the Company in subsequent current reports at a later date.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial data of the Grupa Azoty Group for the second quarter and the first half of 2021:

Q2 2021:
Consolidated revenue: PLN 3,173m
EBIT: PLN 169m
EBITDA: PLN 361m
Net profit: PLN 168m

Results by segment:
Revenue of the Agro Fertilizers segment: PLN 1,642m
EBIT: PLN 71m
EBITDA of the Agro Fertilizers segment: PLN 154m

Revenue of the Chemicals segment: PLN 896m
EBIT: PLN 76m
EBITDA of the Chemicals segment: PLN 101m

Revenue of the Plastics segment: PLN 456m
EBIT: PLN 6m
EBITDA of the Plastics segment: PLN 26m

Revenue of the Energy segment: PLN 83m
EBIT: PLN 0m
EBITDA of the Energy segment: PLN 28m

Revenue of the Other Activities segment: PLN 96m
EBIT: PLN 16m
EBITDA of the Other Activities segment: PLN 52m

H1 2021:
Consolidated revenue: PLN 6,535m
EBIT: PLN 383m
EBITDA: PLN 766m
Net profit: PLN 254m

Results by segment:
Revenue of the Agro Fertilizers segment: PLN 3,661m
EBIT: PLN 250m
EBITDA of the Agro Fertilizers segment: PLN 415m

Revenue of the Chemicals segment: PLN 1,712m
EBIT: PLN 131m
EBITDA of the Chemicals segment: PLN 181m

Revenue of the Plastics segment: PLN 842m
EBIT: PLN -5m
EBITDA of the Plastics segment: PLN 33m

Revenue of the Energy segment: PLN 168m
EBIT: PLN -1m
EBITDA of the Energy segment: PLN 56m

Revenue of the Other Activities segment: PLN 152m
EBIT: PLN 8m
EBITDA of the Other Activities segment: PLN 81m

Compared with the first half od 2020, the Grupa Azoty Group’s EBITDA for the first half of 2021 were boosted mainly by higher prices of almost all products in the key segments (Fertilizers, Chemicals and Plastics) and higher sales volumes in the Chemicals and Plastics segments. Factors with an adverse effect on the results included lower sales in the Fertilizers Segment, as well as an increase in variable costs, caused mainly by higher prices of gas, phenol, propylene and benzene, higher prices of carbon allowances (relative to unhedged positions), as well as a lower amount of compensation paid to energy-intensive companies. At the same time, the Group’s EBITDA was positively impacted by an increase in the expected allocation of free carbon allowances, which was recognised in the estimated accounting for emission costs for the first half of 2021.

Main factors with a bearing on the Group’s financial performance in the second quarter of 2021 compared with the second quarter of 2020:

The segment’s performance benefited from higher prices of nitrogen, compound and speciality fertilizers, as a result of – on the one hand – pressure coming from higher prices of urea, which sets the price paths for other fertilizer products, mainly AN, and – the other hand – the conditions prevailing across global market, i.e. oversupply, low stocks and high prices of agricultural produce (wheat, maize, rape). The segment’s performance was adversly affected mainly by a major spike in natural gas prices.

In the Chemicals Segment, the year-on-year performance improvement was attributable to a solid growth in sales volumes (particularly plasticisers, melamine, NOXy and technical-grade urea) and prices of all key products of the segment. The margins were negatively impacted by strong increases in the prices of raw materials: propylene, terephthalic acid, phosphate rock.

The segment’s performance was buoyed by a year-on-year increase in the prices of polyamide due to higher demand on the main application markets. The segment was negatively impacted by higher prices of key raw materials for production, i.e. benzene and phenol, which came as a result of the products’ limited availability on the market (including as a consequences of plant failure at major manufacturers) and adverse supply and demand movements in Europe.

The amounts presented above are estimates and may be subject to change. The final results will be presented in the consolidated report for the first half of 2021, to be published on September 9th 2021.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached hereto, its answers to the questions asked by a shareholder during the Annual General Meeting on June 30th 2021, in accordance with Article 428.1 of the Commercial Companies Code.

Legal basis: Par. 19.1.12 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 70.3 of the Public Offering Act – List of shareholders holding over 5% of total voting rights at the General Meeting

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, a list of shareholders holding 5% or more of total voting rights at the Annual General Meeting held on June 30th 2021, specifying the number of votes conferred by the shares held by each shareholder, and their percentage share in the votes represented at that Annual General Meeting and in the total voting rights.

Legal basis: Art. 70.3 of the Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies, dated July 29th 2005 (consolidated text: Dz.U. of 2020, item 2080, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the resolutions passed by the Company’s Annual General Meeting on June 30th 2021, together with the results of voting.

The documents voted on by the Annual General Meeting are available on the Company’s website at http://tarnow.grupaazoty.com/pl/relacje/walne.html. They were also published with the Company’s separate and consolidated full-year reports for 2020, and attached to Current Report No. 23/2021 of June 2nd 2021, as corrected on June 15th 2021.

In connection with the use of a computer system for voting and counting the votes, the Annual General Meeting decided not to appoint a Ballot Counting Committee.

The Annual General Meeting did not leave any items of the planned agenda unaddressed. Objections to Resolutions No. 2, 3, 5, 6, 7 and 9 were raised by shareholders for the record in the minutes.

Legal basis: Par. 19.1.6 and Par. 19.1.9 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes a correction of Current Report No. 23/2021 released on June 2nd 2021.

As a result of a mistake, one of the documents to be discussed at the Company’s Annual General Meeting convened for June 30th 2021, relevant for the resolutions to be adopted, was not made public in the aforementioned current report. The document is the independent auditor’s report on assessment of the Supervisory Board’s Report on Remuneration of Members of the Management Board and Supervisory Board for 2019 and 2020.

The document, attached hereto, was posted on the Company’s website at https://tarnow.grupaazoty.com/relacje-inwestorskie/walne-zgromadzenia on the date of convening the Annual General Meeting.

Legal basis: Par. 15.2 in conjunction with Par. 19.1.6 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on June 9th 2021 the Management Board decided that the Company’s activity in the polyoxymethylene (POM) business would be discontinued.

The plan is for the Company to exit the POM business not later than till August 31st 2021.

The analysis revealed that the POM business would not be economically viable in the foreseeable future, which is an indication that the Plastics Segment’s POM business  should be discontinued and its selected assets should be sold.

Consolidated revenue from external sales of POM products in 2020 amounted to PLN 54.1m, and accounted for 0.5% Grupa Azoty S.A. revenue. The planned discontinuation of POM production will reduce the Company’s total CO₂ emissions.

The decision to exit the POM business will have no impact on any other operations of the Plastics Segment.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes, attached to this report, the draft resolutions to be considered and voted on by the Annual General Meeting of the Company convened for June 30th 2021, as well as documents relevant for those resolutions that have not yet been published.

Legal basis: Par. 19.1.2 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) hereby convenes an Annual General Meeting of the Company for June 30th 2021, at 10:00 am, at the Company’s registered office at ul. Kwiatkowskiego 8, Tarnów, Poland, in conference room 57/58, 1st floor. For more details, see the Notice of the Annual General Meeting attached as an appendix hereto.

Legal basis: Par. 19.1.1 of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

Further to Current Report No. 16/2021 of May 5th 2021, the Management Board of Grupa Azoty S.A. (the “Company”) announces that on May 31st 2021, the Company’s Supervisory Board gave a favourable opinion on the proposal of the Company’s Management Board for the Annual General Meeting to allocate the entire net profit for the financial year 2020 of PLN 125,627,538.01 to the Company’s reserve funds. 

A final decision on the appropriation of the 2020 profit will be made by the Annual General Meeting.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on May 31st 2021, the Company and its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Group Companies”, jointly with the Company: the “Factorees”) and BNP Paribas Faktoring Sp. z o.o. (the “Factor”) signed a PLN 500m (or EUR or USD equivalent) master factoring agreement (the “Factoring Agreement”) for indefinite term.

The facility under the Factoring Agreement was made available for the period of 12 months. The facility will be automatically extended for another period of 12 months based on the Factor’s decision communicated to the Factoring Agent no later than 180 days prior to the expiry of the current availability period.

The Factoring Agreement provides for the financing of amounts due to the Company and the Group Companies from their trading partners.

Under the Factoring Agreement, the Factor’s claims are to be secured with:

1. the Company’s notarised declaration of submission to enforcement for up to 120% of the amount of the facility under the Factoring Agreement;
2. assignment to the Factor of the Factorees’ receivables from their trading partners which are to be financed under the Factoring Agreement;
3. assignment to the Factor of the receivables under the Factorees’ receivables insurance agreements, with respect to the rights to compensation for receivables from trading partners which are to be financed under the Factoring Agreement;
4. power of attorney for the Factor over the Factorees’ bank accounts held with BNP Paribas Bank Polska S.A.

The Company is liable for repayment of all amounts due under the Factoring Agreement, while the Group Companies are liable for repayment of their respective liabilities under the Agreement.

The per annum interest rate under the Agreement is equal to the following reference rates: 1M WIBOR for financing denominated in the złoty, 1M EURIBOR for financing denominated in the euro, and 1M LIBOR for financing denominated in the US dollar, plus the Factor’s margin (if the reference rate is below 0, the Factor’s margin is the minimum rate).

The Factoring Agreement also imposes certain restrictions on the Company and the Group Companies, including restrictions on disposal or encumbrance of their material assets, granting loans and guarantees, paying dividends and incurring financial liabilities if a certain level of consolidated net debt to EBITDA is exceeded, which have been made consistent with the revolving credit facility agreement of April 23rd 2015, as amended by the amendment of June 29th 2018, referred to in the Company’s Current Report No. 25/2015 of April 23rd 2015 and Current Report No. 33/2018 of June 29th 2018.

The terms of the Factoring Agreement do not differ from standard terms used in agreements of such type.

The purpose of the Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the Group’s financial security through the umbrella nature of facility allocation and authorisation of the Company, as the Factoring Agent, to redistribute the facility, as well as to include new factorees which are the Company’s subsidiaries in the Factoring Agreement.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on  May 31st 2021, the Company and its subsidiaries: Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Group Companies”, jointly with the Company: the “Factorees”) and Pekao Faktoring Sp. z o.o. (the “Factor”) signed a PLN 250m (or EUR or USD equivalent) factoring agreement (the “Factoring Agreement”), as well as a PLN 250m (or EUR or USD equivalent) agreement for the financing of deliveries (the “Reverse Factoring Agreement”).

The Factoring Agreement and the Reverse Factoring Agreement were concluded for indefinite term. The facilities under those two Agreements will be available for a period of 12 months and will be automatically extended for another 12 months unless, prior to the facility expiry date, the Factor gives notice of intention not to extend them, whereby the Factoring Agreement or the Reverse Factoring Agreement will be terminated on 120 days’ notice with the facilities remaining available to the Factorees during the notice period.

The Factoring Agreement provides for the financing of amounts due to the Company and the Group Companies from trading partners, while the Reverse Factoring Agreement provides for the financing of amounts due to suppliers and service providers from the Company and the Group Companies.

Under the Factoring Agreement, the Factor’s claims are to be secured with:

1. the Company’s notarised declaration of submission to enforcement for up to 120% of the amount of the facility under the Factoring Agreement;
2. assignment to the Factor of the Factorees’ receivables from their trading partners which are to be financed under the Factoring Agreement;
3. assignment to the Factor of the receivables under the Factorees’ receivables insurance agreements, with respect to the rights to compensation for receivables from trading partners which are to be financed under the Factoring Agreement;
4. power of attorney for the Factor over the Factorees’ bank accounts held with Bank Polska Kasa Opieki S.A.;
5. financial and registered pledges over receivables from the Factorees’ bank accounts held with Bank Polska Kasa Opieki S.A.

Security for the Factor’s claims required under the Reverse Factoring Agreement is the Company’s notarised declaration of submission to enforcement for up to 120% of the amount of the facility under the Reverse Factoring Agreement.

In accordance with the Factoring Agreement and the Reverse Factoring Agreement, the Company is liable for repayment of all amounts due under each of the Agreements, while the Group Companies are liable for repayment their respective liabilities under the Agreements.

 The per annum interest rate under each of the Agreements is equal to the following reference rates: 1M WIBOR for financing denominated in the złoty, 1M EURIBOR for financing denominated in the euro, and 1M LIBOR for financing denominated in the US dollar, plus the Factor’s margin (if the reference rate is below 0, the Factor’s margin is the minimum rate).

The Agreements also impose certain restrictions on the Company and the Group Companies, including restrictions on disposal or encumbrance of their material assets, granting loans and guarantees, paying dividends and incurring financial liabilities if a certain level of consolidated net debt to EBITDA is exceeded, which have been made consistent with the revolving credit facility agreement of April 23rd 2015, as amended by the amendment of June 29th 2018, referred to in the Company’s Current Report No. 25/2015 of April 23rd 2015 and Current Report No. 33/2018 of June 29th 2018.

The terms of the Factoring Agreement and the Reverse Factoring Agreement  do not differ from standard terms used in agreements of such type.

The purpose of the Factoring Agreement and the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the Grupa Azoty Group’s financial security through the umbrella nature of facility allocation and authorisation of the Company, as the Factoring Agent, to redistribute the facilities, as well as to include new factorees which are the Company’s subsidiaries in both the Factoring Agreement and the Reverse Factoring Agreement.   

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Art. 56.1.2 of the Public Offering Act – Current and periodic information

The Management Board of Grupa Azoty S.A. (the “Company”) announces that at its meeting held on May 13th 2021 the Company’s Supervisory Board resolved to remove the following persons from the Management Board, with effect from May 17th 2021:

- Witold Szczypiński – Vice President of the Management Board,

- Artur Kopeć – Member of the Management Board.

At the same meeting, the Supervisory Board resolved to appoint Marek Wadowski to the Management Board of the new 12th term of office as its Vice President, with effect as of May 18th 2021.

The Supervisory Board also appointed Zbigniew Paprocki as Member of the Management Board of the new 12th term of office, with effect as of May 18th 2021.

The Supervisory Board, thus, validated the ballot held between March 22nd and April 12th 2021 to elect an employee representative to the Management Board of the 12th term of office and confirmed the election of Zbigniew Paprocki.

The Management Board further announces that Zbigniew Paprocki resigned as Member of the Supervisory Board on May 13th 2021.

The Management Board also announces that Marek Wadowski has made a representation to the effect that as of May 18th 2021 (i.e. on assumption of his responsibilities as Vice President of the Management Board), he will not be engaged in any activities outside Grupa Azoty S.A. that would be in competition with the Company’s business, nor will he be a partner or shareholder in any competing partnership or company or a member of a governing body of any other competing legal entity.

Zbigniew Paprocki has made a representation to the effect that he is not engaged in any activities conducted outside Grupa Azoty S.A. that would be in competition with the Company’s business, nor is he a partner or shareholder in any competing partnership or company or a member of a governing body of any other competing legal entity.

The appointed persons are not entered in the Register of Insolvent Debtors maintained pursuant to the National Court Register Act.

A brief description of the newly appointed Management Board Members’ educational background, qualifications, previously held positions and employment records is attached to this current report.

Legal basis: Par. 5.4 and Par. 5.5. of the Minister of Finance’s Regulation on current and periodic information to be published by issuers of securities and conditions for recognition as equivalent of information whose disclosure is required under the laws of a non-member state, dated March 29th 2018 (Dz.U. of 2018, item 757).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”) publishes the estimated selected consolidated financial data of the Grupa Azoty Group for Q1 2021:

Revenue: PLN 3,362.0m

EBITDA: PLN 405.1m

Net profit: PLN 85.9m

Results by segment:

Revenue of the Agro Fertilizers segment: PLN 2,018.8m

EBITDA: PLN 261.5m

Revenue of the Chemicals segment: PLN 815.3m

EBITDA: PLN 80.0m

Revenue of the Plastics segment: PLN 386.6m

EBITDA: PLN 7.8m

Revenue of the Energy segment:  PLN 84.6m

EBITDA: PLN 27.6m

Revenue of the Other Activities segment: PLN 56.7m

EBITDA: PLN 20.6m

Positive drivers of the Grupa Azoty Group’s EBITDA included mainly the higher prices of products across all key segments (Fertilizers, Plastics and Chemicals). On the other hand, EBITDA was negatively affected mainly by the higher prices of raw materials used in the Group’s production processes, primarily natural gas, as well as an increase in electricity transmission charges (the new “capacity charge” and revised RES charge) and in the prices of CO₂ emission allowances.

EBITDA performance of the Agro Fertilizers segment was largely a result of the higher selling prices of nitrogen, compound and speciality fertilizers compared with Q1 2020, driven by strong demand resulting from high grain prices and lower fertilizer imports. The positive effect of the increase in selling prices was offset by an increase in production costs due to the higher prices of raw materials, mainly natural gas.

The development of the Plastics segment’s EBITDA relative to Q1 2020 was largely a combined effect of the higher average product prices and increased demand across virtually all applications. The prices of key raw materials had a varied effect on EBITDA. In the period under review, some of the prices went up (benzene) and some went down (phenol) on a year-on-year basis.

EBITDA of the Chemicals segment was driven by a surge in the prices of OXO alcohols, melamine, technical grade urea and plasticizers. Demand on most segment markets rebounded versus Q1 2020, with the rebound particularly pronounced in the case of OXO alcohols. The increase in product prices more than offset the increases in the prices of most raw materials used in the Chemicals segment’s production processes.

A significant factor behind net profit posted by the Group for Q1 2021 was also the effect of measurement of financial instruments hedging cash flows of the Polimery Police project, entered into in accordance with the requirements of the credit facilities agreement and resulting from the financing raised in USD and payments made in EUR, mainly to the general contractor. The measurement of these financial instruments had the effect of increasing the Group’s finance costs in Q1 2021 by approximately PLN 90.1m.

The Company’s Management Board considers the information on the estimated consolidated results to be material given that the results generated in Q1 2021 differ from market expectations. At the same time, the estimated consolidated financial results generated in Q1 2021 are lower than the average consolidated results reported by the Company in the corresponding periods of the three previous years, i.e. Q1 2018–2020.

The amounts presented above are estimates and may be subject to change. The consolidated report for Q1 2021 will be issued on May 13th 2021.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

Grupa Azoty S.A. (the “Company”) announces that on May 5th 2021 its Management Board passed a resolution to recommend that the Company’s entire net profit for the financial year 2020, of PLN 125,627,538.01, be allocated to the Company’s statutory reserve funds. 

The Management Board recommends that the entire net profit for 2020 be retained by the Company.

The retained profit would be held as a liquidity buffer enabling the implementation of further investment plans after the entire equity contribution to the strategic Polimery Police project was made by December 31st 2020.

Furthermore, dividend payment restrictions are laid down in credit facility agreements concluded by the Company.

The credit facility agreements provide that dividend may be paid if the ratio of consolidated net financial debt to consolidated EBITDA of the Grupa Azoty Group (the “Group”), determined in accordance with the credit facility agreements, is no higher than 2.5 as at December 31st of a financial year (actual level based on the audited consolidated financial statements) and as at June 30th and December 31st of the next year (levels determined taking into account the consolidated budget). The ratio calculated based on the Group’s consolidated financial statements for 2020 was 2.10 as at December 31st 2020. However, based on the Group’s current consolidated budget these conditions will not be met as at June 30th and December 31st 2021.

In order to implement the resolution, the Management Board will request the Supervisory Board to assess the proposal and the General Meeting to decide on the allocation of net profit for the financial year 2020.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on April 29th 2021 the Company and its subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Group Companies”) signed a PLN 500m (or EUR or USD equivalent) payment services and financing agreement (the “Reverse Factoring Agreement”) with CaixaBank S.A. Polish Branch (the “Bank”) for an indefinite term.

The facility under the Reverse Factoring Agreement is available for a period of 12 months and is automatically extended for another 12 months unless the Bank or the Factoring Agent gives notice of intention not to extend it no later than 120 days before expiry of the current availability period.

The Reverse Factoring Agreement provides for the financing of the Company’s and the Group Companies’ liabilities towards their suppliers and service providers.

The Bank’s claims under the Reverse Factoring Agreement are secured by a notarised statement of submission to enforcement made by the Company, for up to 120% of the value of the Reverse Factoring Agreement.
The Company is liable for all payments due under the Reverse Factoring Agreement, while each of the Group Companies is liable exclusively for payments due from it thereunder.

The per annum interest rate is equal to the reference rates of 1M WIBOR for financing denominated in the złoty, 1M EURIBOR for financing denominated in the euro, and 1M LIBOR for financing denominated in the US dollar, plus the Bank’s margin (if the reference rate is below 0, the Bank’s margin is the minimum rate).
The terms of the Reverse Factoring Agreement do not differ from standard terms used in agreements of such type.

The Reverse Factoring Agreement also imposes certain restrictions on the Company and the Group Companies, including restrictions on disposal or encumbrance of their material assets, granting loans and guarantees, paying dividends and incurring financial liabilities above the consolidated net debt to EBITDA ratio, which have been made consistent with the credit facility agreement of April 23rd 2015 amended by the Amending Agreement of June 29th 2018, as announced in the Company’s Current Report No. 25/2015 of April 23rd 2015 and Current Report No. 33/2018 of June 29th 2018.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the Group’s financing security by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement as clients.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).

Legal basis: Article 17(1) of MAR – Inside information

The Management Board of Grupa Azoty S.A. (the “Company”, the “Factoring Agent”) announces that on April 29th 2021 the Company and its subsidiaries Grupa Azoty Zakłady Azotowe Puławy S.A., Grupa Azoty Zakłady Chemiczne Police S.A. and Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. (the “Group Companies”) signed a PLN 500m (or EUR or USD equivalent) reverse factoring agreement (the “Reverse Factoring Agreement”) with ING Commercial Finance Polska S.A. (the “Factor”) for an indefinite term.

The facility under the Reverse Factoring Agreement is available for a period of 12 months and is automatically extended for another 12 months unless the Factor or the Factoring Agent gives notice of intention not to extend it no later than 120 days before expiry of the current availability period.

The Reverse Factoring Agreement provides for the financing of the Company’s and the Group Companies’ liabilities towards their suppliers and service providers.

The Factor’s claims under the Reverse Factoring Agreement are secured by a notarised statement of submission to enforcement made by the Company, for up to 120% of the value of the Reverse Factoring Agreement.
The Company is liable for all payments due under the Reverse Factoring Agreement, while each of the Group Companies is liable exclusively for payments due from it thereunder.

The per annum interest rate is equal to the reference rates of 1M WIBOR for financing denominated in the złoty, 1M EURIBOR for financing denominated in the euro, and 1M LIBOR for financing denominated in the US dollar, plus the Factor’s margin (if the reference rate is below 0, the Factor’s margin is the minimum rate).
The terms of the Reverse Factoring Agreement do not differ from standard terms used in agreements of such type.

The Reverse Factoring Agreement also imposes certain restrictions on the Company and the Group Companies, including restrictions on disposal or encumbrance of their material assets, granting loans and guarantees, paying dividends and incurring financial liabilities above the consolidated net debt to EBITDA ratio, which have been made consistent with the credit facility agreement of April 23rd 2015 amended by the Amending Agreement of June 29th 2018, as announced in the Company’s Current Report No. 25/2015 of April 23rd 2015 and Current Report No. 33/2018 of June 29th 2018.

The purpose of the Reverse Factoring Agreement is to finance operating activities, optimise interest expenses, help manage working capital and liquidity, and enhance the Group’s financing security by establishing an umbrella structure of facility limit allocation and authorising the Company, acting as the Factoring Agent, to redistribute the facility limits and to allow its other subsidiaries to accede to the Reverse Factoring Agreement as clients.

Legal basis: Article 17(1) of Regulation (EU) 596/2014 of the European Parliament and of the Council of April 16th 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ EU of June 12th 2014, No. L 173/1, as amended).