Mhp Reg S Regulatory News (MHPC)

19 November 2019, Limassol, Cyprus

MHP SE

Financial Results for the Third Quarter and Nine Months Ended 30 September 2019

MHP SE (LSE:MHPC), the parent company of a leading international agro-industrial group with headquarters in Ukraine, focusing primarily on the production of poultry and cultivation of grain, today announces its results for the third quarter and nine months ended 30 September 2019. Hereinafter, MHP SE and its subsidiaries are referred to as "MHP", "The Company" or "The Group".

EVENTS DURING AND POST REPORTING PERIOD

Further to the announcement in February of the acquisition of Perutnina Ptuj (PP), the largest producer of poultry meat and poultry meat products in the Balkans region of southeast Europe, MHP completed the acquisition of minority shareholders by the end of September 2019 and is now 100% owner of PP.

On 13 September 2019, MHP announced that it had completed a US$350 million Eurobond of 6.25% notes due 19 September 2029 - making it the longest dated bond issue by a Ukrainian corporate Eurobond with the lowest coupon ever in the private sector in Ukraine. Proceeds from this new issue enabled full repayment of MHP"s short-term liabilities (US$335 million at end of H1 2019), extending MHP's maturity profile and making virtually all its debt long-term.

OPERATIONAL HIGHLIGHTS

In 2019, MHP has continued to launch additional production sites as part of Phase 2 of the Vinnytsia Poultry Complex ('Vinnytsia'). Between January and September, another three rearing sites (brigades) became operational bringing the total to six. MHP is planning to launch one additional brigade in Q1 2020.

Q3 2019 highlights

·; Poultry production volume reached 186,555 tonnes, up 24% year-on-year (Q3 2018: 150,650 tonnes). Poultry production volumes of the European operating segment (PP) amounted to 24,160 tonnes

·; The average chicken meat price decreased by 4% year-on-year to UAH 38.58 per kg (Q3 2018: UAH 40.38 per kg) (excluding VAT). The average price of chicken meat produced by PPJ during Q3 2019 was EUR 2.63 per kg

·; Chicken meat exports remained stable and amounted to 79,189 tonnes (excluding PPJ's 4,215 tonnes), compared with 80,361 tonnes in Q3 2018.

9M 2019 highlights

·; Poultry production volume reached 540,133 tonnes, up 18% year-on-year (9M 2018: 458,540 tonnes). Poultry production volumes of European operating segment amounted to 56,037 tonnes

·; The average chicken meat price remained relatively stable year-on-year to UAH 39.18 per kg (9M 2018: UAH 39.66 per kg) (excluding VAT). The average price of chicken meat produced by PPJ during 9M 2019 was EUR 2.64 per kg

·; Chicken meat exports increased by 26% to 269,672 tonnes (excluding PP's 10,129 tonnes) compared with 213,925 tonnes in 9M 2018, as a result of increased exports mainly to MENA, the EU, Africa and Asia.

FINANCIAL HIGHLIGHTS

Q3 2019 highlights

·; Revenue of US$ 560 million, increased by 27% year-on-year (Q3 2018: US$ 441 million)

·; Export revenue of US$ 317 million, comprising 57% of total revenue (Q3 2018: US$ 275 million, 62% of total revenue)

·; Operating profit of US$ 40 million was down 44% year-on-year from US$ 71 million; operating margin declined from 16% to 7%

·; Adjusted EBITDA margin declined correspondingly from 22% to 19%; adjusted EBITDA up from US$ 99 million to US$ 109 million

·; Net profit was US$ 104 million, compared to net loss US$ 49 million for Q3 2018, including foreign exchange gains of US$ 109 million compared with losses of US$ 88 million in Q3 2018

9M 2019 highlights

·; Revenue of US$ 1,505 million, increased by 33% year-on-year (9M 2018: US$ 1,133 million)

·; Export revenue of US$ 869 million, comprising 58% of total revenue (9M 2018: US$ 660 million, 58% of total revenue)

·; Operating profit of US$ 218 million was down 23% year-on-year from US$ 283 million and operating margin declined from 25% to 14%

·; Adjusted EBITDA of US$ 357 million was down marginally from prior year, adjusted EBITDA margin declined from 32% to 24%

·; Net profit was US$ 276 million, up 94% from US$ 142 million in 9M 2018, including foreign exchange gains of US$ 182 million, compared to FX losses of US$ 16 million in 9M 2018

FINANCIAL OVERVIEW

* pps - percentage points

Average official FX rate for Q3 2019 UAH/US$ 25.26 and for Q3 2018 UAH/US$ 27.35

Average official FX rate for 9M 2019 UAH/US$ 26.37 and for 9M 2018 UAH/US$ 26.95

DIVIDENDS

On 21 March 2019, the Board of Directors of MHP SE approved the payment of an interim dividend of US$ 0.7474 per share, equivalent to approximately US$ 80 million, which was paid to shareholders in 2019. 

OUTLOOK

The long awaited land reform bill has already passed its first reading. The Company views the lifting of the moratorium as positive as it will finally open up a free land market and create new opportunities for local agribusinesses of all sizes.

The industry is facing a number of challenges in global markets some of which are likely to continue at least into early 2020. Certain key markets in MENA have temporarily restricted the import of poultry products from international producers, including MHP, and we are hopeful that some of these issues will be resolved early in the new year. However, we significantly expanded our operations in other markets in the MENA region increasing volumes through geographic diversification and we foresee new opportunities in Asian markets going forward.

Returns from the Grain division have been adversely affected by low global commodity prices and strengthening of the Ukrainian currency, which will impact full year profitability.

However, MHP, with its vertically-integrated business model, which is the basis of the Company's efficient cost of production, strong balance sheet and strong cash generation, is well placed to manage these short-term challenges. We are pleased with first seven months' results at PP and efficiency improvements already achieved are ahead of initial expectations. 

DIAL-IN DETAILS

MHP's management will host a conference call for investors and analysts followed by Q&A on the day of the results

The dial-in details are:

Time: 14.00 London / 16.00 Kyiv / 09.00 New York

Title: Financial results for Q3 and 9M 2019

UK: +44 2071943759

Ukraine: +38 0893239877

USA: +1 6467224916

Conference ID EV00097113

PIN code 53832181#

In order to follow the presentation together with the management, please register using the following link: http://event.onlineseminarsolutions.com/r.htm?e=1809217&s=1&k=53F5382C4D55BE2D550DA4EB17C5E881

For Investor Relations enquiries, please contact:

Anastasia Sobotiuk (Kyiv) +38 044 207 99 58 a.sobotyuk@mhp.com.ua

For Analysts enquiries, please contact:

Iryna Bublyk (Kyiv) +38 044 207 00 04 i.bublik@mhp.com.ua

Segment Performance

Poultry and related operations

Chicken meat prices

The total volume of chicken meat sold to third parties in 9M 2019 increased by 14% to 511,241 tonnes (9M 2018: 449,215 tonnes) as a result of growth in exports. In Q3 2019 export sales totaled 79,189 tonnes and remained almost at the same level compared to Q3 2018 export sales volume of 80,361 tonnes. In 9M 2019 poultry exports increased by 26% to 269,672 tonnes (9M 2018: 213,925 tonnes). MHP continued to follow a strategy of both geographic diversification and product mix optimization, building-up the export volumes of chicken meat in MENA countries and the EU.

In 9M 2019, the average chicken meat price was UAH 39.18, almost unchanged compared to 39.66 in 9M 2018. In Q3 2019 the average chicken meat price decreased by 4% year-on-year at UAH 38.58 per kg (Q3 2018: UAH 40.38 per kg).

Vegetable oil

In Q3 2019, sunflower oil sales volume amounted to 84,975 tonnes, down 8% year-on-year. In 9M 2019 MHP's sales of sunflower oil increased by 13% compared to 9M 2018 to 271,462 tonnes. The increase in volumes in 9M 2019 was driven mainly by an increase in production and by delivery terms changing from DAP (Delivered at Place) to FOB (Free on Board).

Sales of soybean oil were 15,758 tonnes in Q3 2019, 156% higher year-on-year, and 40,007 tonnes in 9M 2019, 6% higher year-on-year, mainly due to increased production and sales of some stocks. MHP also sells soybean cake to third parties.

* pps - percentage points

As a result of the increase in sales volumes of chicken meat and sunflower oil, revenue increased by 8% in 9M 2019 compared to 9M 2018.

IAS 41 standard gain in 9M 2019 amounted to US$ 12 million (compared with a US$ 9 million loss in 9M 2018) mainly as a result of an increase of poultry meat stocks and broiler chicken stocks due to the launch of new rearing sites.

Gross profit of the poultry and related operations segment for 9M 2019 was relatively stable compared to 9M 2018 and amounted to US$ 227 million. This was due to the increase in sales volume and IAS 41 standard gain partly offset by increased production costs, reflecting higher cost of mixed fodder protein components as well as the higher payroll costs experienced since mid-2018. Poultry production costs in Q3 2019 remained almost at the same level as in Q3 2018.

Adjusted EBITDA per 1 kg of chicken meat in Q3 2019 slightly decreased by 2% to US$ 0.49.

Grain growing operations

In 2019 the Company harvested around 360,000 hectares of land.

Due to operational efficiency and favorable weather conditions in Ukraine, MHP delivered strong harvest and yields across all crops, significantly higher than Ukraine's average, however, lower year-on-year due to the record harvest of crops in 2018.

* - Including barley, rye, sugar beet, sorghum and other and excluding land left fallow as part of crop rotation.

* - MHP yields are net weight, Ukraine - bunker weight;

Revenue from the Grain growing segment for 9M 2019 amounted to US$ 174 million compared to US$ 84 million in 9M 2018. The increase was mainly attributable to the higher level of crops in stock designated for sale as of 31 December 2018, compared to stocks as of 31 December 2017, mainly due to the record yields in 2018.

Gross profit of the grain growing segment for 9M 2019 decreased by 53% and amounted to US$ 53 million compared to US$ 113 million in 9M 2018. This was due to the decrease in IAS 41 standard gain for 9M 2019 by 87% mainly as a result of the decline in grain prices as well as lower yields of corn in 2019 compared to 2018.

Meat processing and other agricultural operations segment

Sales volume of processed meat products increased by 13% year-on-year and amounted to 10,179 tonnes in Q3 2019. The average processed meat price increased by 6% year-on-year to UAH 66.97 per kg in Q3 2019 mainly due to launch of the new "Mini" sausage product.

Sales volumes of convenience food in Q3 2019 increased by 12% to 5,605 tonnes. The average price in 9M 2019 decreased by 6% to UAH 40.62 per kg (excluding VAT), mainly due to product mix changes.

* pps - percentage points

** includes milk, cattle and feed grains.

Segment revenue of 9M 2019 increased by 10% year-on-year to US$ 107 million mainly as a result of an increase in the price of processed meats as well as sales volume of processed meat and convenience food products. The segment's adjusted EBITDA remained stable with the lower returns earned from milk operations partly offset by higher meat processing results. 

European operating segment (PP)

* results of PPJ from 21 February 2019 when the acquisition was completed

In Q3 2019 poultry sales of the newly-established Europe operating segment, which comprises the operations of Perutnina Ptuj, were 15,920 tonnes with an average price of EUR 2.63. In 9M 2019 sales amounted to 36,928 tonnes with an average price of EUR 2.64.

* includes sausages and convenience foods

** results of PPJ from 21 February 2019 when the acquisition was completed

In Q3 2019, meat processing products sales at PP constituted 9,918 tonnes with an average price of EUR 2.69, while in 9M 2019 sales amounted to 21,040 tonnes with an average price of EUR 2.70.

* results of PPJ from 21 February 2019 when the acquisition was completed

European operating segment's revenue in Q3 2019 amounted to US$ 86 million, and US$ 193 million in 9M 2019. Adjusted EBITDA reached US$ 13 million for the quarter and US$ 29 million for 9M 2019, respectively. Adjusted EBITDA margin was 15% for both periods.

Current Group cash flow

* Calculated as Net Cash from operating activities plus Cash used in investing activities plus Total financial activities

Cash flow from operations before changes in working capital for 9M 2019 amounted to US$ 240 million (9M 2018: US$ 243 million).

Positive cash flow effects from changes in working capital during 9M 2019 mostly reflect reduction in inventory as unusually high stocks of sunflower and soya crops as of 31 December 2018 (following record high yields in 2018) were utilized or sold during the period. Additional effect arises due to increase in amounts payable for seeds and plant protection products to be paid in the fourth quarter of 2019.

In 9M 2019 total CAPEX amounted to US$ 99 million mainly related to the launch of production sites of Phase 2 of the Vinnytsia Poultry Complex.

Debt Structure and Liquidity

1) Net of IFRS 16 adjustments: as if any lease that would have been treated as an operating lease under IAS 17 as was in effect before the 1 January 2019, is treated as an operating lease for purposes of this calculation. In accordance with covenants in MHP's bond and loan agreements, these data exclude the effects of IFRS 16 on accounting for operating leases.

2) Calculated as if acquisitions of subsidiaries had occurred on the first day of the four-quarter reference period. LTM adjusted EBITDA of Perutnina Ptuj d.d amounted to US$ 44 million

As of 30 September 2019, the share of long-term debt in the total outstanding debt increased to 93% of total debt ( 90% of total debt as of 31 December 2018). The weighted average interest rate is around 6.8%.

As of 30 September 2019, MHP's cash and cash equivalents amounted to US$ 288 million. Net debt increased to US$ 1,293 million, compared to US$ 1,131 million as at 31 December 2018.

The Net Debt / LTM EBITDA ratio was 2.96 as of 30 September 2019, well within the Eurobond covenant limit of 3.0.

As a hedge for currency risks, revenue from the export of grain, sunflower and soybean oil, sunflower husks, and chicken meat are denominated in US Dollars and Euros, more than fully covering debt service obligations. Export revenue for 9M 2019 amounted to US$ 869 million or 58% of total revenue (US$ 660 million or 58% of total sales in 9M 2018). 

Notes to Editors:

About MHP

MHP is the leading producer of poultry products not only in Ukraine , but also in the Balkans (Perutnina Ptuj Group) and in the EU.

Ukraine: MHP has the greatest market share (around 57% of industrial production) and highest brand recognition for its products. MHP owns and operates each of the key stages of chicken production processes, from feed grains and fodder production to egg hatching and grow out to processing, marketing, distribution and sales (including through MHP's franchise outlets). Vertical integration reduces MHP's dependence on suppliers and its exposure to increases in raw material prices. In addition to cost efficiency, vertical integration also allows MHP to maintain strict biosecurity and to control the quality of its inputs and the resulting quality and consistency of its products through to the point of sale. To support its sales, MHP maintains a distribution network consisting of 15 distribution and logistical centres, within major Ukrainian cities. MHP uses its trucks for the distribution of its products, which Management believes reduces overall transportation costs and delivery times.

MHP also has a leading grain cultivation business growing corn to support the vertical integration of its chicken production and increasingly other grains, such as wheat and rape, for sale to third parties. MHP leases agricultural land located primarily in the highly fertile black soil regions of Ukraine.

The Balkans: Perutnina Ptuj is a leading poultry and meat-processing producer in the Balkans, has production assets in four Balkan countries: Slovenia, Croatia, Serbia, Bosnia and Herzegovina; owns distribution companies in Austria, Macedonia and Romania and supply products to 15 countries in Europe. Perutnina Ptuj is a vertically integrated company across all states of chicken meat production - feed, hatching eggs production and hatching, breeding, slaughtering, sausages and further poultry processing production.

Since May 15, 2008, MHP has traded on the London Stock Exchange under the ticker symbol MHPC.

Forward-Looking Statements

This press release might contain forward-looking statements that refer to future events or forecast financial indicators for MHP SE. Such statements do not guarantee that these are actions to be taken by MHP SE in the future, and estimates can be inaccurate and uncertain. Actual final indicators and results can considerably differ from those declared in any forward-looking statements. MHP SE does not intend to change these statements to reflect actual results.

MHP SE AND ITS SUBSIDIARIES

Interim condensed consolidated Financial Statements

As of and for the nine-month period ended 30 September 2019

CONTENTS

STATEMENT OF MEMBERS OF THE BOARD OF DIRECTORS............................................................... (a)

MANAGEMENT REPORT...................................................................................................................... (b)

INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE NINE-MONTH PERIOD ENDED 30 SEPTEMBER 2019

INTERIM CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME.............................................................................................................................................................. 5

INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION..................................... 7

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY..................................... 8

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS............................................... 10

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.............................. 12

1. Corporate information..................................................................................................................... 12

2. Basis of preparation and accounting policies................................................................................... 13

3. Changes in the group structure........................................................................................................ 17

4. Segment information...................................................................................................................... 20

5. Profit for the period........................................................................................................................ 23

6. Deferred revenues.......................................................................................................................... 23

7. Property, plant and equipment........................................................................................................ 23

8. Inventories..................................................................................................................................... 24

9. Biological assets............................................................................................................................ 24

10. Trade accounts receivable, net and trade accounts payable........................................................... 24

11. Share capital............................................................................................................................... 24

12. Bank borrowings.......................................................................................................................... 24

13. Bonds issued.............................................................................................................................. 25

14. Related party balances and transactions....................................................................................... 28

15. Contingencies and contractual commitments................................................................................. 29

16. Fair value of financial instruments................................................................................................. 30

17. Risk management policy.............................................................................................................. 30

18. Dividends.................................................................................................................................... 31

19. Subsequent events...................................................................................................................... 31

20. Authorization of the interim condensed consolidated financial statements....................................... 31

STATEMENT OF MEMBERS OF THE BOARD OF DIRECTORS

In accordance with Article 10 of the Transparency Requirements (Securities for Trading on Regulated Market) Law 190(l)/2007 ("Law"), we the members of the Board of Directors of MHP SE confirm that to the best of our knowledge:

(a) The interim condensed consolidated financial statements for the period from 1 January 2019 to30 September 2019 that are presented on pages 5 to 31:

i. were prepared in accordance with International Financial Reporting Standards and in accordance with the provisions of Article 10 (4) of the Law, and

ii. give a true and fair view of the assets and liabilities, the financial position and the profits of MHP SE and the businesses that are included in the interim condensed consolidated financial statements, and

(b) the interim management report gives a fair review of the information required under Article 10 (6) of the Law.

19 November 2019

Members of the Board of Directors:

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

Director Yuriy Melnyk

Director John Grant

Director John Clifford Rich

Director Roger Wills

Director Christakis Taoushanis

Director Roberto Banfi

MANAGEMENT REPORT

Key financial highlights

On 21 February 2019, the Group acquired 90.69% of the issued share capital and thereby obtained control of Perutnina Ptuj, a Slovenian based international meat-processing company and the most important and largest producer of poultry meat and poultry meat products in Southeast Europe (Note 3). Group financial results for the nine-month period ended 30 September 2019 include the results of Perutnina Ptuj from 21 February 2019 when the acquisition was completed.

During the nine-month period ended 30 September 2019 consolidated revenue increased by 33% and amounted to USD 1,504,547 thousand, compared to USD 1,133,090 thousand for the nine-month period ended 30 September 2018. Export sales for the nine-month period ended 30 September 2019 constituted 58% of total revenue and amounted to USD 869,324 thousand, compared to USD 660,323 thousand, and 58% of total revenue for the nine-month period ended 30 September 2018. The overall increase in revenue was mainly attributable to the acquisition of operations in Europe (Perutnina Ptuj) as well as increased Ukrainian export sales volume of chicken meat.

Gross profit decreased by 2% and amounted to USD 345,921 thousand for the nine-month period ended30 September 2019 compared to USD 354,459 thousand for the nine-month period ended 30 September 2018. The decrease was driven mainly by decrease of the gross profit in grain growing operations segment, partly offset by the new Europe operating segment.

Operating profit decreased by 23% to USD 217,997 thousand for the nine-month period ended 30 September 2019 compared to USD 283,461 thousand for the nine-month period ended 30 September 2018, in higher rate compared to gross profit mainly as a result of an increase in selling, general and administrative expenses primarily due to the inclusion of additional expenses of Perutnina Ptuj as well as increased consulting services, advertising expense and representative costs.

Profit for the nine-month period ended 30 September 2019 increased by 95% and amounted to USD 275,532 thousand, compared to USD 141,650 thousand for the nine-month period ended 30 September 2018, mainly due to an increase of foreign exchange gain partly offset by higher administration, sales and distribution expenses.

Dividends

On 21 March 2019, the Board of Directors of MHP SE approved the payment of an interim dividend of USD 0.7474 per share, equivalent to approximately USD 80,000 thousand, which was paid to shareholders during the nine-month period ended 30 September 2019.

Risks and uncertainties

There are a number of potential risks and uncertainties, which could have a material impact on the Group's performance over the remaining three months of the financial year and could cause actual results to differ materially from expected and historical results. The directors do not consider that the principal risks and uncertainties have changed since the publication of the annual report for the year ended 31 December 2018. A detailed explanation of these risks, and how the Group seeks to mitigate the risks, can be found on pages 162 to 167 of the Annual Report which is available at www.mhp.com.cy.

Correction of prior period disclosure errors

Subsequent to issuance of the consolidated financial statements as of and for the year ended 31 December 2018, the management of Group identified errors in the disclosure of operating land lease commitments due to the fact that not all constructive obligations were captured in the calculation. In addition, the management of the Group identified errors in disclosure of the impact on the amounts of the right of use asset and lease liability on initial application of IFRS 16 as of 1 January 2019. Issues identified in the underlying data were still under evaluation by management at the point of issuing these interim condensed consolidated financial statements and are planned to be addressed by the end of the year.

The effect of the restatement on the disclosure provided in the consolidated financial statements as of and for the year ended 31 December 2018 is disclosed in Note 2 to the interim condensed consolidated financial statements for the nine-month period ended 30 September 2019. The restatements have no impact on the consolidated statement of financial position as of 31 December 2018, consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity, consolidated statement of cash flows and basic and diluted earnings per share for the year then ended.

19 November 2019

On behalf of the Board: 

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

INTERIM CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

for the nine-month period ended 30 September 2019

(in thousands of US dollars, unless otherwise indicated)

The accompanying notes on the pages 12 to 31 form an integral part of these interim condensed consolidated financial statements

INTERIM CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

for the nine-month period ended 30 September 2019

(in thousands of US dollars, unless otherwise indicated)

On behalf of the Board: 

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

The accompanying notes on the pages 12 to 31 form an integral part of these interim condensed consolidated financial statements

INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as of 30 September 2019

(in thousands of US dollars, unless otherwise indicated)

On behalf of the Board:

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

The accompanying notes on the pages 12 to 31 form an integral part of these interim condensed consolidated financial statements

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the nine-month period ended 30 September 2019

(in thousands of US dollars, unless otherwise indicated)

On behalf of the Board:

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

The accompanying notes on the pages 12 to 31 form an integral part of these interim condensed consolidated financial statements

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the nine-month period ended 30 September 2018

(in thousands of US dollars, unless otherwise indicated)

On behalf of the Board:

Chief Executive Officer Yuriy Kosyuk

Chief Financial Officer Viktoria Kapelyushnaya

The accompanying notes on the pages 12 to 31 form an integral part of these interim condensed consolidated financial statements

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

for the nine-month period ended 30 September 2019

(in thousands of US dollars, unless otherwise indicated)