Toolux Sanding S A : Annual Report 2018

B.C.R.H. & Associés

Société d'Expertise Comptable et de Commissariat aux Comptes

Toolux Sanding SA

3B, boulevard du Prince Henri

L-1724 Luxembourg

RCS Luxembourg B 142 041

INDEPENDENT AUDITOR'S

REVIEW REPORT

CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

SARL au capital de 1 300 000 Euros - 35 rue de Rome - 75008 PARIS - Tél : [phone] - Fax : [phone]

RCS PARIS B 490 092 574

INDEPENDENT AUDITOR'S REPORT ON

CONSOLIDATED FINANCIAL STATEMENTS

OF TOOLUX SANDING SA AS AT 31 DECEMBER 2018

To the shareholders of Toolux Sanding SA,

Following the Company's request, we have audited the accompanying consolidated financial statements of Toolux Sanding SA (" the Company ") and its subsidiaries (together the "Group") which comprise the consolidated statement of financial position as at December 31st 2018, the consolidated statement of comprehensive income, the consolidated statement of cash flows and the consolidated statement of changes in equity for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Director's responsibility for the financial statements

The directors of the Company are responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor's responsibility

Our responsibility is to express an opinion on these consolidated financial statement based on our audit. We conducted our audit in accordance with International Standards of Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the judgement of the auditor, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on effectiveness of the entity's internal control.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(euros)

TOOLUX SANDING SA

ITEMS	NOTE	From January 1, 2018	From January 1, 2017
to December 31,2018	to December 31,2017
SALES OF MAIN OPERATIONS	IV(II) (1)	12	464	682	12	421 570
Less:cost of main operations	IV(II) (2)	-9	043	257	-8	862 566
GROSS PROFIT		3 421 425	3 559 004

Add: Income from other operations	IV(II) (3)		180 783		102 578
Less: Selling	expenses	IV(II) (4)		-561 196		-567 936
Less: General	and administrative expenses	IV(II)	(5)	-3	190 727	-2	262 870
Less: Financial expenses	IV(II)	(6)	-1	389 182	-1	333 446
OPERATING INCOME			-1 538 897	-502 670

Investment income(loss expressed with "-")		3 586	-149 236
Non-operating income	IV(II) (7)	183	111	197 749
Less:Sales tax and additions		-103	762	-68 611
Less:Non-operating expenses	IV(II) (8)	-270	929	-14 233
PROFIT BEFORE TAX (LOSS EXPRESSED WITH "-")		-1 726 891	-537 001
Less: Income tax		-4	469	-32 568
TOTAL COMPREHENSIVE INCOME FOR THE YEAR		-1 731 360	-569 569

PROFIT PER SHARE (BASIC AND DILUTED)

-0,99

-0,32

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(euros)

From January 1, 2018 to December 31, 2018

TOOLUX SANDING SA

ITEMS	NOTE	December 31,2018	December 31,2017
NON CURRENT ASSETS :
Property, plant and equipment	IV(I) (6)	17 488 948	17 640 654
Less:Accumulated depreciation	IV(I) (6)	-6 272 726	-5 873 617
Property, plant and equipment (net value)	IV(I) (6)	11 216 222	11 767 037
Construction in progress	IV(I) (7)	657 593	428 567
Intangible assets	IV(I) (8)	812 151	830 015
Long-term investment		155 842	157 254
Long-term prepaid assets		35 792	114 524
Deferred tax assets
TOTAL NON CURRENT ASSETS		12 877 600	13 297 397
CURRENT ASSETS:
Inventories	IV(I) (5)	2 577 569	1 546 142
Trade debtors	IV(I) (2)	2 142 345	2 627 365
Other receivable	IV(I) (3)	7 844 402	8 925 163
Advances to suppliers	IV(I) (4)	6 192 181	6 977 970
Cash and cash equivalents	IV(I) (1)	7 520 701	6 026 307
TOTAL CURRENT ASSETS		26 277 198	26 102 947
TOTAL ASSETS		39 154 798	39 400 344
CURRENT LIABILITIES:
Bank borrowings	IV(I) (11)	19 962 921	20 501 256
Notes payable	IV(I) (12)	1 523 790	256 266
Trade creditors	IV(I) (13)	2 214 040	1 465 596
Advances received from customers	IV(I) (14)	1 834 041	199 843
Welfare benefits payable		178 250	165 437
Taxes payable	IV(I) (15)	144 944	192 308
Other levies payable		7 111	10 502
Other payable	IV(I) (16)	2 871 133	4 351 221
TOTAL CURRENT LIABILITIES		28 736 230	27 142 429
OWNERS'/SHAREHOLDERS' EQUITY
Subscribed capital		1 753 667	1 753 667
Other reserves		6 191 682	7 923 042
Exchange differences on translating foreign operations		2 396 823	2 688 689
TOTAL OWNERS' EQUITY		10 342 172	12 365 398
Non-controlling interests		76 396	-107 483

TOTAL LIABILITIES & OWNERS' EQUITY	39 154 798	39 400 344