ARMATURE SA
ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31st of December, 2025
PREPARED IN ACCORDANCE WITH THE INTERNATIONAL FINANCIAL REPORTING STANDARDS ADOPTED BY THE EUROPEAN UNION
CONTAINED PAGE
STATEMENT OF FINANCIAL POSITION 3 - 4
STATEMENT OF COMPREHENSIVE INCOME 5 - 6
STATEMENT OF CHANGES IN EQUITY 7
STATEMENT OF CASH FLOWS 8
NOTES TO THE FINANCIAL STATEMENTS 9 – 47
ANNEX A – DIRECTORS' REPORT
ARMĂTURA S.A. STATEMENT OF FINANCIAL POSITION FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
31st December 31st December
Note
2025 2024
Active
Fixed assets
Tangible fixed assets 6
17.130 111.785 Intangible assets 7
0 0 Right to use assets
In leasing 16
0 0
Total fixed assets
17.130 111,785
Circulating Active
Stocks 11
400 1.422 Customers and other receivables 10
291.126 554.756 Cash and equivalents
of cash 12
6.301.688 6.487.942 Financial assets in the short term
0 0
Total circulating assets
6.593.194 7.044.120
Tax claims on deferred profit 17
129.230 156.517
Total activ
6.739.554 7.312.422
Equity and liabilities
Capital social 13
4.000.000 4.000.000 Elements assimilated to capital 14.110.957 14.110.957 Reserves
1.304.075 1.304.075 Retained earnings
-12.701.423 -12.469.372
Total equity
6.713.609 6.945.660
The accompanying notes are an integral part of these financial statements. 3
ARMĂTURA S.A. STATEMENT OF FINANCIAL POSITION FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
Long-term debts
Loans 15
0 0 Tax liabilities Deferred 17
0 0 Payables from leasing operations 16
0 0 Suppliers and other liabilities
0 0 Total debts in the long term
0 0
Current payables
Suppliers and other liabilities 14
25.362 182.221 Settlements with shareholders regarding Share capital
100 100 Loans 15
0 0 Payables from leasing operations 16
442 13.856 Provisions for risks and expenses 18
41 170.586
Total debts Current
25.945 366.762
Total debts
25.945 366.762
Total equity and liabilities
6.739.554 7.312.422
Administrator, Drawn up by,
Racovita Adrian Ec. Rus Dana
The accompanying notes are an integral part of these financial statements. 4
ARMĂTURA S.A. STATEMENT OF COMPREHENSIVE INCOME FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
Year ended
Year ended
31st December
31st December
Note
2025
2024
Income
940.172
1.727.563 Other operating income
54.563
277.089 Change in stocks of finished products
and production in progress
0
0 Raw materials and materials
-53.135
-81.432 Cost of goods
-11.540
-11.058 Personnel expenses 21
-627.694
-820.669 Utility expenses
-137.921
-182.569 Services provided by third parties
-907.080
-546.061 Depreciation and amortization
fixed assets
-225.274
-525.440 Net movement in provision for other
Risks and expenses 18
170.545
36.498
Other operating expenses 20 -72.067 -109.189
Other income / (loss), net 19
-47.029
-5.573
Operating result
-916.461
-240.841
Financial income
127.867
265.448 Financial expenses
-862
-6.837
Net financial profit/loss 22
127.005
258.611
Profit/Loss Before Tax
-789.456
17.770
Income / (Expense) with corporate income tax
current and deferred 23
-27.287
-4.947
Net profit/loss for the year
-816.743
12.823
Number of shares issued
40.000.000 40.000.000
Diluted and Per Share Earnings
0.020418575 0,0003206
The accompanying notes are an integral part of these financial statements. 5
ARMᾸTURA S.A. STATEMENT OF COMPREHENSIVE INCOME FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
Year ended
Year ended
31st December
31st December
Note
2025
2024
Net profit for the year
-816.743
12.823
Other comprehensive income:
Gain/(Loss) from revaluation Buildings
-
- Impact of deferred tax on revaluation reserves
-
-
Other comprehensive income for the year, net tax
-
-
Total comprehensive result for the year
-816.743
12.823
Administrator, Drawn up by, Racovita Adrian Ec. Rus Dana
The accompanying notes are an integral part of these financial statements. 6
Capital social El. assimilated to capital Other reserves Retained earnings Total
Balance as of 1st of January , 2024
4.000.000
14.110.957
1.304.075
-11.871.593
7.543.439
Profit/Loss for 2024
-
-
-
12.823
12.823 Other comprehensive income
-
-
-
-610.602
-610.602 Revaluation reserves
-
-
-
Total overall result
-
- - -597.779 -597.779
Balance as of 31st December , 2024
4.000.000
14.110.957
1.304.075
-12.469.372
6.945.660
Profit/Loss of the Year 2025
-
-
-
-816.743
-816.743 Other comprehensive income
584.692
584.692
Total overall result
-
- -
-232.051 -232.051
Balance as of 31st December , 2025
4.000.000
14.110.957
1.304.075
-12.701.423
6.713.609
Balance as of 1st of January , 2025
4.000.000
14.110.957
1.304.075
-12.469.372
6.945.660
The financial statements were signed today
Administrator, Drawn up by,
Racovita Adrian Ec. Rus Dana
The accompanying notes are an integral part of these financial statements. 7
ARMĂTURA SA STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
ARMĂTURA SA STATEMENT OF CASH FLOWS FOR YEAR ENDED ON 31st of December 2025 (in Romanian Lei, if not otherwise specified)
Year ended on Year ended on
31st December 31st December
Note
2025
2024
Cash flows from Operating Activities Cash generated from operations 24
102.288
-679.934 Paid interest
-420
-6.329
Net cash generated from operating activities
143.889
-686.263
Cash flows from investments Acquisitions of property, plant and equipment
-440.239 Net proceeds from the sale of
24.230 2,435 tangible fixed assets
Interest received
127.867
265.417
Net cash used in investment activities
-288.142
265.417
Cash flows from financing activities
Loan repayment
-
- Repayment of interest on the loan
-
-
Net cash used in financing activities
-
-
Net change in cash and cash equivalents
-186.274
-951.680 Cash and cash equivalents at the beginning of the year 12
6.487.942
7.439.622
Increases /- Decreases
--186.274
-951.680
Cash and cash equivalents at the end of the year 12
6.301.668
6.487.942
Administrator, Drawn up by,
Racovita Adrian Ec. Rus Dana
8
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
1 GENERAL INFORMATION
ARMATURA SA (the "Company") was registered at the beginning of 1991 with the Cluj Trade Register as a joint stock company, and at the end of 1996 it completed the privatization process, being currently a fully private company. The company has its registered office in Cluj Napoca, Garii Street, no. 19, where it also carries out its production activity.
The company's object of activity is "Manufacture of taps", NACE code 2814 and operates in the field of metal fittings with an experience in the production of fittings for heating and water and gas supply installations, including today in its product portfolio over 1,500 typodimensional items. The Company's clients are national and international companies.
The Company's shares have been listed on the standard category of the Bucharest Stock Exchange since 1997, and in 2021 the main shareholder is HERZ ARMATUREN Ges.m.b.H Austria. Starting from 10.10.2025 the main shareholder is Microfruits SA ,that have acquired from HERZ ARMATUREN Ges.m.b.H Austria 86.2245% of the total shares.
The company has subscribed and paid-up share capital in the amount of RON 4,000,000 consisting of 40,000,000 shares with a nominal value of RON 0.1 per share.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The main accounting policies applied in the preparation of these financial statements are presented below. These policies have been applied consistently in all the years presented, unless otherwise specified.
2.1 Basis of preparation
The Company's financial statements have been prepared in accordance with the provisions of the Order of the Minister of Public Finance no. 2844/2016, for the approval of the Accounting Regulations in accordance with the International Financial Reporting Standards, applicable to companies whose securities are admitted to trading on a regulated market, with subsequent amendments and clarifications. These provisions correspond to the requirements of the International Financial Reporting Standards (IFRS), adopted by the European Union (EU). The effects of the change in the exchange rates, regarding the functional currency. For the purpose of preparing these financial statements in accordance with the legislative requirements of Romania, the functional currency of the Company is considered to be RON ("Romanian leu"). For the year ended 31st December , 2011 and for all previous financial years, the Company
9
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
has prepared the financial statements in accordance with the Romanian accounting regulations (local accounting principles) represented by OMF 3055/2009 for the years 2011 and 2010. As of 31st December , 2012, the Company prepared the first set of IFRS financial statements adopted by the EU.
The preparation of financial statements in accordance with IFRS requires the use of critical accounting estimates. It also asks the management to use reasoning in the process of applying the Company's accounting policies. Areas involving a higher degree of complexity and application of these reasonings or those in which assumptions and estimates have a material impact on the financial statements are presented in note 4.
2.1.1. Business continuity
These financial statements have been prepared based on the principle of business continuity, which implies that the Company will continue its activity for the foreseeable future.
The nature of the Company's activity may bring unpredictable variations in terms of cash inflows in the future. The management analyzed the issue of the opportunity to prepare the financial statements based on the principle of business continuity.
As of 31st December , 2025, the Company recorded a loss of RON 816.743 lei.
2.1.2 New accounting regulations
The following amendments to the existing standards and new interpretations issued by the International Accounting Standards Board (IASB) and adopted by the EU are in force for the current period:
Amendments to IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures – Interest Rate Benchmark Reform – Phase 2. They were adopted by the EU on 15 January 2020, and are applicable for periods starting on or after 1 January 2021.
Amendments to IFRS 4 Insurance Contracts – Extension of the temporary exemption from the application of IFRS 9. The expiry date of the temporary exemption from the application of IFRS 9 has been extended for annual periods beginning on or after 1st of January , 2024.
Amendments to IFRS 16 Leasing ContractsAdopted by the EU on August 30, 2021 and are applicable after June 30, 2021.
10
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
As of 1st of January , 2018, the Company has applied IFRS 15 Revenue from customer contracts. IFRS 15 sets out a five-step model that will apply to the recognition of income arising from a contract with a customer (with limited exceptions), regardless of the type of transaction or industry. The requirements of the standard will also apply to the recognition and measurement of gains and losses on the sale of certain non-operational assets that are not the result of the entity's ordinary business (e.g., sale of property, plant and equipment and intangible assets). Provision will be made for extensive disclosures, including disaggregation of total income, information on performance obligations, changes in contractual balances of asset and liability accounts between periods, and key reasoning and estimates.
The company obtained in the year revenues from the rental of spaces to other companies until the date of sale of the properties, and the revenues are measured at the fair value of the net amounts collected. The income obtained from the rental of spaces is recognized when there is an obligation to register a contract, respectively if the following conditions have been met: The parties to the contract have approved the contract in writing The Company may identify the rights of each party in relation to the services to be transferred The company can identify the terms of payment for rent The contract has commercial content The company has a number of 0 tenants as of 31.12.2025
New standards, amendments and interpretations issued by the IASB and adopted by the EU, but not applicable for the financial year ended 31 December 2025, as a result not adopted:
Amendments to IFRS 3 Business Combinations; IAS 16 Property, plant and equipment; IAS 37 Provisions, Contingent Liabilities and Contingent Assets; and Annual Improvements 2018-2020 (all issued on May 14, 2020) – applicable for periods beginning on or after 1st of January , 2022.
IFRS 17 Insurance Contracts (issued on May 18, 2017); including Amendments to IFRS 17 (issued on June 25, 2020) – applicable for periods beginning on or after 1st of January , 2023.
Amendments to IAS 8 Accounting Policies, Changes to Accounting Estimates and Errors: Definition of Accounting Estimates (published February 12, 2021) – applicable for periods beginning on or after 1st of January , 2023.
11
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Amendments to IAS 1 Presentation of Financial Statements and Practice Statement 2 IFRS: Presentation of Accounting Policies (published on February 12, 2021) – applicable for periods beginning on or after 1st of January , 2021.
The Company anticipates that the adoption of these standards and amendments to existing standards will not have a material impact on the Company's financial statements during the initial application period.
There are no other IFRS or IFRIC interpretations that have not yet entered into force and that could have a material impact on the Company's financial statements.
2.2 Segment reporting
A segment is a distinct component of the Company that provides certain products or services (business segment) or provides products and services in a specific geographic environment (geographic segment) and that is subject to different risks and rewards than other segments. From the point of view of business segments, the Company does not identify distinct components in terms of risks and benefits.
IFRS 8 Business Segments must apply to the Company's Financial Statements because its equity instruments are traded on a public market (BVB).
The presentation of information on the products and services, as well as the geographical areas in which the company operates is mandatory, even for those entities that identify a single reportable segment of activity, taking into account the quantitative thresholds and aggregation criteria provided by the standard. Taking into account the quantitative thresholds and aggregation criteria provided by the standard, from the point of view of the business segments, the Company does not identify distinct components from the perspective of the associated risks and benefits.
Sales % in total Sales
Sales of residual products 11.776 1,25%
Sales from works performed 91.953 9,78%
Rent 654.931 69,66%
Sales of goods 11.540 1,23%
Sales from miscellaneous activities 169.972 18,08%
Sales of foreign goods
-
Vanzari servicii extern
-
Total 940.172 100%
12
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
2.3 Foreign currency conversion
(a) Functional and presentation currency
The financial statements are presented in lei (RON), the national currency of Romania. The company keeps the accounting records in lei, prepares and presents its financial statements in accordance with the specific legislation on the matter and with the Regulations on accounting and financial-accounting reports issued by the Ministry of Public Finance.
(b) Transactions and balances
Transactions in foreign currency are converted into functional currency using the exchange rate valid on the date of the transactions. Gains and losses arising from exchange rate differences following the conclusion of these transactions and from the conversion at the end of the financial year at the year-end exchange rate of monetary assets and obligations denominated in foreign currency are reflected in the profit and loss account.
Exchange rate gains and losses that relate to loans and cash and cash equivalents are presented in the profit and loss account under "financial income or expenses". All other gains and losses at the exchange rate are presented in the profit and loss account under "Other (loss)/gain – net".
Monetary assets and liabilities denominated in foreign currency are expressed in lei at the balance sheet date. As of 31st December , 2025, the exchange rate used to convert balances to foreign currency is 1 EUR = 5.0985 RON. Gains and losses arising from the translation of monetary assets and liabilities are reflected in the profit and loss account during the year.
2.4 Accounting for the effects of hyperinflation
The Romanian economy has gone through periods of relatively high inflation and has been considered hyperinflationary according to IAS 29 "Financial Reporting in Hyperinflationary Economies" ("IAS 29").
IAS 29 requires that financial statements prepared in the currency of a hyperinflationary economy be restated in terms of purchasing power at the balance sheet date. The amounts expressed in terms of purchasing power at 31 December 2004 (the date of cessation of hyperinflation) are treated as the basis for the carrying amounts in these financial statements.
The Company has decided to reflect the impact of the application of IAS 29 in the financial
13
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
statements as at 31st December , 2012. The impact of these adjustments was reflected on the value of the land, the share capital and the deferred result.
2.5 Tangible fixed assets
The residual value of an asset is the estimated value that could be obtained by the Company from the sale of the respective asset minus the estimated costs of the sale, if the asset is already old and meets the conditions related to its end of useful life. The residual value of an asset is zero if the Company estimates the use of the asset until the end of its physical life. Residual asset values and useful lives are reviewed, and adjusted accordingly, at each balance sheet date. The gains and losses on disposal are determined by comparing the amounts obtained from the disposal with the book value, and are recognized under "Other (losses)/net gains" in the statement of income and expenses. When selling revalued assets, the amounts included in other reserves are transferred to the retained earnings.
2.6 Intangible assets
Computer programs
The acquired licenses related to the rights to use the software are capitalized on the basis of the costs incurred with the acquisition and commissioning of the respective software. These costs are amortized over their estimated useful life (three years). The costs related to the development or maintenance of software are recognized as expenses during the period in which they are performed.
2.6 Intangible assets (continued)
Other intangible assets
Other intangible assets include computer programs created by the entity or acquired from third parties for their own use, as well as other intangible assets owned by the Company. Expenses that allow intangible assets to generate future economic benefits beyond their originally anticipated performance are added to their original cost. These expenses are capitalized as intangible assets, if they are not an integral part of tangible assets.
2.7 Impairment of non-financial assets
14
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Assets that are subject to depreciation are reviewed to identify impairment losses whenever events or changes in circumstances indicate that the carrying amount can no longer be recovered. The impairment loss is represented by the difference between the carrying amount and the recoverable amount of the respective asset. The recoverable amount is the maximum of the fair value of the asset minus the costs of sale and the value in use.
2.8 Financial assets
Loans and receivables
Classification
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not listed on an active market. They are included in current assets, except for those that have a maturity period of more than 12 months from the balance sheet date. They are classified as fixed assets.
Recognition and evaluation
Regular purchases and sales of financial assets are recognised at the trading date – the date on which the Company undertakes to buy or sell the respective asset. Financial assets cease to be recognised when the right to receive cash flows from investments expires or is transferred, and the Company transfers all risks and benefits related to ownership. Loans and receivables are recorded at amortized cost based on the effective interest method. The Company's loans and receivables are classified as "cash and cash equivalents" and "customers and other receivables" in the balance sheet (notes 2.12 and 2.15).
2.9 Clearing of financial instruments
Financial assets and liabilities are offset and net worth is reported on the balance sheet only when there is an applicable legal right to offset the amounts recognised and there is an intention to offset on a net basis or to capitalise on the asset and offset the liability at the same time.
2.10 Stocks As of 31.12.2025, the company no longer holds stocks of consumable materials and animals and poultry in the amount of 400 lei.
15
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
2.11 Commercial creation
Receivables are recorded at nominal value minus adjustments for their impairment.
Trade receivables are the amounts owed by customers for products, goods sold or services rendered in the normal course of business
The provision for the impairment of trade receivables is constituted when there is objective evidence that the Company will not be able to collect all the amounts due to it according to the initial conditions of the receivables. Significant difficulties faced by the debtor, the probability that the debtor will enter into bankruptcy or financial reorganization proceedings, non-payment or non-compliance with payment terms are considered indicative of impairment of trade receivables.
The carrying amount of the asset is reduced by using a provision account, and the amount of the loss is recognised in the statement of income and expenses under "other gains/(losses) – net" in the profit and loss account. When a trade receivable cannot be recovered, it is passed on to the expense, with the corresponding reversal of the provision for trade receivables. Subsequent recoveries of previously depreciated amounts are credited to the profit and loss account.
2.12 Cash and cash equivalents
For the cash flow statement, cash and its equivalents include cash in the house, bank accounts, bank deposits on demand, other short-term financial investments, overdraft facilities, and the short-term part of restricted bank accounts.
2.13 Share capital and reserves
The share capital composed of common shares is registered at the value established on the basis of the articles of incorporation and addenda, as the case may be, as well as the supporting documents regarding the capital payments. The repurchased own shares, according to the law, are presented in the statement of assets, debts and equity as a correction of the equity.
Gains or losses related to the issuance, redemption, sale, free disposal or cancellation of the entity's equity instruments are recognised directly in equity under the lines of "Gains / or Losses related to equity instruments".
2.14 Trade payables
16
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Trade payables are recognised at fair value.
Trade debts are obligations to pay for goods or services that have been purchased in the normal course of business from suppliers. Accounts payable are classified as current payables if payment is due within one year or less than one year (or later in the normal course of business). Otherwise, they will be presented as long-term debts.
2.15 Loans
As of 31.12.2025, the company no longer holds loans.
2.16 Current and deferred income tax
The company registers current corporate income tax at a rate of 16% of the taxable profit resulting from the statutory financial statements, by adjusting the expenses that cannot be deducted and the non-taxable income, in accordance with the Romanian Fiscal Code and related regulations.
The tax expense for the period includes the current tax and the deferred tax. The tax is recognised in the profit and loss account, unless it relates to items recognised in other comprehensive income or directly in equity. In this case, the related tax is also recognised in other items of comprehensive income or directly in equity.
The current income tax expense is calculated based on the tax regulations in force at the balance sheet date in Romania. The management periodically evaluates the positions in the tax returns in terms of the situations in which the applicable tax regulations are interpretable. This constitutes provisions, where applicable, based on the amounts estimated to be due to the tax authorities.
Deferred income tax is recognized on the basis of the balance sheet obligation method, for the temporary differences between the tax bases of assets and liabilities and their book values in the financial statements. However, the deferred income tax resulting from the initial recognition of an asset or liability in a transaction other than a business combination, and which at the time of the transaction does not affect the accounting profit or the taxable profit is not recognised. The deferred corporate income tax is determined on the basis of the tax rates (and laws) that came into force until the balance sheet date and that are to be applied during the period in which the deferred tax to be recovered will be recovered or the deferred tax will be paid.
The deferred tax to be recovered is recognised only to the extent that it is likely that a taxable
17
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
profit will be obtained in the future from which temporary differences are deducted.
Deferred tax receivables and liabilities are offset when there is an applicable legal right to offset current tax receivables against current tax liabilities, and when deferred tax receivables and liabilities are imposed by the same tax authority either on the same taxable entity or on different taxable entities, if there is an intention to offset the balances on a net basis.
2.17 Uncertain fiscal positions
The Company's uncertain tax positions are analyzed by the management at the date of each balance sheet. Liabilities are recorded for tax positions for which management believes that additional taxes are likely to be applied if these positions were to be verified by the tax authorities. The valuation is based on the interpretation of the tax laws that were adopted at the balance sheet date. Liabilities related to penalties, interest and taxes, other than income tax, are recognised on the basis of management's best estimates necessary to settle obligations at the balance sheet date.
2.18 Employee benefits
During the financial year, the Company makes payments to the Social Security budget on behalf of its employees, as all of them are included in the public pension system.
The Company does not contribute to any other pension plan or benefits after retirement and does not have any other obligations of the kind mentioned above, for its employees.
Benefits at the end of the activity
In the collective labor agreement of the Company, valid for the previous period, it was stipulated that the Company's employees receive on the occasion of retirement a bonus equivalent to one/two basic salaries they had in the month prior to retirement. The company has made an estimate of the present value of this promised benefit, in order to constitute the necessary provision, but which did not materialize because it is not considered to have a significant impact on the financial statements. Also, in the collective labor agreement of the Company, valid for the previous period, it was provided that the Company's employees receive compensatory payments in case of termination of the individual employment contract for reasons related to the Company. The Company has made an estimate of the present value of this promised benefit, and has constituted the necessary provision on the financial statements ended as of 31st December , 2025.
2.19 Provisions
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ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Provisions are recognised when the Company has a current obligation (legal or implied) generated by a previous event, it is likely that an outflow of resources is necessary to honour the obligation, and the debt can be credibly estimated.
Provisions for taxes are constituted for the amounts to be paid to the state budget, provided that these amounts are not reflected as a debt in relation to the state.
The provisions are revised at the date of the financial statements and adjusted to reflect Management's current best estimate in this regard. If an outflow of resources is no longer likely to be extinguished in order to extinguish an obligation, the provision must be cancelled by resumption of income.
2.20 Revenue recognition
Revenue is recorded when the significant risks and benefits of owning property are transferred to the client. The amounts representing the income do not include sales taxes (VAT), but include the commercial discounts granted. The financial discounts granted to customers (discounts) reduce the value of the Company's income.
The Company recognises revenue when its amount can be measured reliably, when it is probable that it will produce future economic benefits to the entity, and when specific criteria have been met for each of the Company's activities as described below. The amount of revenue is not considered reliably measurable until all contingencies relating to sales have been resolved. The Company bases its estimates on historical results, taking into account the type of customer, the type of transaction and the specific elements of each contract.
Revenue from services rendered is recognised in the period in which they are rendered and in line with the stage of completion.
Interest income shall be recognized periodically, in a proportional manner, as the respective income is generated, based on accrual accounting.
Revenue from rental income and/or rights to use assets is recognised on an accrual basis, as per the contract.
Dividends distributed to shareholders, proposed or declared after the date of the financial statements, are recognised as dividend income when the shareholder's right to receive them is established.
2.21 Leasing contracts
19
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Leasing is a contract, or part of a contract, that gives the company the right to use an asset (the underlying asset) for a certain period of time in exchange for a consideration. The company, as lessee, obtains the right to use an underlying asset for a certain period of time in exchange for a countervalue.
At the date of commencement of the exercise, the Company values the asset relating to the right of use at cost.
The cost of the asset related to the right of use includes: - The value of the initial valuation of the debt arising from the leasing contract; - Any lease payment made on or before the commencement date, less any lease incentives received; - Any initial direct costs incurred by the company; - An estimate of the costs to be incurred by the company as lessee for the dismantling and removal of the underlying asset, for the restoration of the place where it is located or for bringing the underlying asset to the condition imposed in the terms and conditions of the leasing contract, unless these costs are incurred for the production of inventories. The lessee assumes the obligation towards these costs either at the date of the start of the development or as a result of the use of the underlying asset during a certain period.
The Company will choose not to apply the provisions of IFRS16 for short-term leases (<12 months) and for leases for which the underlying asset has a low value.
Depreciation of the underlying asset is determined as follows: - If at the end of the leasing contract the transfer of ownership takes place, then the depreciation will be recognized as an expense over the useful life of the asset. - Otherwise, depreciation will be recognised for the lesser of the useful life of the asset and the lease period.
In 2025, the Company had an ongoing leasing contract, namely the one for the rental of buildings and land from Koro Lando Real Estate SRL.After this date ,Armatura SA rents a 203.34 m plot from Koro Lando Real Estate SRL for an indefinite period.
2.22 Distribution of dividends
The distribution of dividends is recognized as a debt in the Company's financial statements during the period in which the dividends are approved by the Company's shareholders.
3 FINANCIAL RISK MANAGEMENT
20
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
3.1 Financial risk factors
By the nature of its activities, the Company is exposed to various risks including: market risk (including monetary risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Company's risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial performance. The Company does not use derivatives to hedge against certain risk exposures.
Risk management is the responsibility of the management of ARMATURA SA based on the policies approved by the board of directors. The Company's management identifies and assesses financial risks in close cooperation with the Company's operational units. The Board of Directors provides basic principles for risk management, as well as recommendations for specific areas such as currency risk, interest rate risk, credit risk and excessive liquidity investing.
(a) Market risk
(i) Currency risk
The Company operates mainly in Romania and is exposed to currency risk resulting from exposure to various currencies, in particular related to the Euro. Currency risk results mainly from the Company's loans, receivables and trade debts.
The company is not hedged against currency risk. Because the Company's activities are carried out mainly on the domestic market, it does not generate income in the same currency as loans. However, the management regularly receives forecasts regarding the evolution of the RON / EUR exchange rate and uses the information in the pricing strategy. The management will consider in the future the development of strategies to protect the Company against currency risk.
(ii) Interest rate risk on cash flow and fair value
The company has no significant interest-bearing assets. The interest rate risk in the Company's case stems from the long-term loan. The contracted loan is variable interest rate and exposes the Company to the interest rate risk on cash flow, which is partially offset by the cash held at variable rates. In 2021 and 2020, the Company's floating rate loan was denominated in Euro.
The company dynamically analyzes its interest rate exposure. Different scenarios are simulated, taking into account refinancing, renewal of existing positions and alternative
21
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
financing. Based on these scenarios, the Company calculates the profit and loss impact of the interest rate change. For each simulation, the same percentage of interest rate change is used for all currencies. The scenarios apply only to debts that constitute major interest- bearing positions.
(b) Credit risk
Credit risk results from cash and cash equivalents, deposits with banks and financial institutions, as well as from customers' credit exposures, including outstanding receivables and committed transactions. In the case of banks and financial institutions, only those independently assessed with a minimum "BB" rating are accepted. For clients, there is no independent assessment, management assesses the client's financial creditworthiness, taking into account the client's financial position, past experience and other factors. The individual risk limits are established on the basis of internal and external ratings, according to the limits set by the board of directors. The use of credit limits is monitored regularly. See note 9 for further presentations on credit risk.
(c) Liquidity risk
Cash flow forecasts are made by the Company's operating entities and aggregated by the Company's management. The Company's management monitors the forecasts regarding the Company's liquidity needs, to ensure that there is sufficient cash to meet operational requirements. These forecasts take into account the Company's debt financing plans, compliance with agreements, compliance with internal objectives regarding the indicators in the balance sheet.
The Company's management invests the surplus cash in interest-bearing current accounts and term deposits, selecting instruments with appropriate maturities or sufficient liquidity to provide sufficient margin, as established on the basis of the above-mentioned forecasts.
The table below analyzes the Company's financial liabilities by groups of relevant maturity, depending on the period remaining at the balance sheet date until the date of contractual maturity. The values presented in the table represent the respective gross values at the balance sheet date.
On of 31st December , 2025 under 1 year 1 - 5 years
over 5 years
Total
Loans - - -
-
22
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Leasing liabilities Suppliers and other liabilities 25.945 - -
25.945
Total 25.945 - -
25.945
At of 31st December , 2024 sub 1 an 1 - 5 or
over 5 years
Total
Loans - - -
- Leasing liabilities 13.156 -
13.156 Suppliers and other liabilities 352.906 - -
352.906
Total 366.762 - -
366.762
3.2 Capital Risk Management
The Company's capital management objectives are to protect the Company's ability to continue its activity in the future, so as to bring profit to shareholders and benefits to the other parties involved, as well as to maintain an optimal capital structure to reduce capital expenditures.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends granted to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The company monitors the capital based on the leverage ratio. This coefficient is calculated by dividing the net debt by equity. Net debt is calculated by subtracting cash and cash equivalents from total loans (including "short and long-term loans" on the balance sheet). The total capital is calculated by adding the net debt to the "equity" of the balance sheet.
31st December 2025
31st December 2024
Total loans (note 15) - - Less: cash and cash equivalents available to the Company (note 12) - -
23
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Net debt -
Total equity - -
Total capital -
Indebtedness - -
3.3 Estimate at fair value
The company does not hold financial instruments measured on the balance sheet at fair value and therefore disclosures related to fair value measurements by levels do not apply.
Estimates and reasoning are evaluated on an ongoing basis and are based on historical experience and other factors, including anticipations of future events that are considered reasonable under the given conditions.
4 CRITICAL ACCOUNTING ESTIMATES
Critical accounting estimates and assumptions
The Company makes estimates and assumptions about the future. The resulting accounting estimates will, by definition, rarely be equal to the corresponding actual results. Estimates and assumptions that involve a high degree of risk or that cause significant adjustments to the carrying amounts of assets and liabilities in the following financial year are set out below.
(a) Corporate income tax
In order to establish the provision for corporate income tax, significant appraisals are necessary. There are several transactions and calculations for which the determination of the final tax is uncertain. The company acknowledges obligations for anticipated problems resulting from tax audits based on estimates regarding the payment of additional taxes. If the final tax result of these operations is different from the amounts initially recorded, the differences will influence the receivables and liabilities regarding the current or deferred income tax during the period in which the determination is made. The recognition of an asset in terms of deferred corporate income tax takes into account a detailed analysis regarding the possibility of its realization.
(b) Estimated impairment of fixed assets
24
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
The determination of the loss from depreciation of equipment requires significant reasoning, as described in note 2.8. In making this estimate, the Company compares the net carrying amount of this equipment to the greater of the estimated selling price and the net present value of the cash flows that will be generated by the equipment over its remaining life
5 RETAINED EARNINGS
As of 31st December , 2025, the Company has a retained earnings of RON 476.156,51.
25
Total
Financial year ended 31st December , 2024
Initial net book value
-
117.557
41
-
-
117.598 Increases in revaluation in equity -
-
-
-
- - Transfers -
-
-
-
- - Entries -
17.905
3.212
-
- 21.117 Outputs -
-2.525
-
- -2.525 Depreciation expense -
-23.516
-1.204
-
- -24.720 Cumulative amortization of outflows -
316
-
- 316 Impairment adjustments -
-
-
Revaluation increases in comprehensive income -
-
-
-
- -
Final net book value -
109.737
2.048
-
-
111.785
As of 31st December , 2024
Cost or valuation -
2.236.391
52.514
-
-
2.288.905 Cumulative depreciation -
-2.126.654
-50.466
-
- -2.177.120 Impairment adjustments -
-
-
-
- -
Net book value -
109.737
2.049
-
-
111.785
Invest Real estate
Furniture, equipment and equipment
Assets under construction
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Vehicles and machinery
26
6. TANGIBLE ASSETS
Land and Clǎdiri
Total
Financial year ended 31st December , 2025
Initial net book value
-
109.737
2.049
-
-
117.785 Increases in revaluation in equity -
-
-
-
- - Transfers -
-
-
-
- - Entries -
4.614
-
4.614 Outputs -
-2.197.560
-21.931
-2.219.491 Depreciation expense -
-6442
-15.187
-21.629 Cumulative amortization of outflows -
2.099.170
25.186
2.124.356 Impairment adjustments -
Revaluation increases in comprehensive income -
-
-
-
- -
Final net book value -
9.518
-9.883
-
-
-365
As of 31st December , 2025
Cost or valuation -
43.445
48.077
-
-
91.522 Cumulative depreciation -
-33.927
-40.465
-
- --74.392 Impairment adjustments -
-
-
-
- -
Net book value -
9.518
7.611
-
-
17.130
Invest Real estate
Furniture, equipment and equipment
Assets under construction
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Vehicles and machinery
27
6. TANGIBLE ASSETS (continued)
Land and Clǎdiri
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
6 TANGIBLE FIXED ASSETS (continued)
The method of depreciation of property, plant and equipment in the financial year 2024 was linear. No residual value has been established for them.
7. INTANGIBLE ASSETS
Advances and Other fixed assets necorporale
Total
Financial year ended 31 December 2025 Net book value
Initial Balance
-
-
-
Entries Outputs
-
-
- Depreciation expense
-
-
- Cumulative depreciation
-
-
-
Sold final la 31st December , 2025
0
-
0 Cost
268.978
-
268.978 Accumulated depreciation and amortization
268.978
-
268.978 Net book value
0
-
0
Programs Computer
Active Luate in leasing
Advances and Other fixed assets necorporale
Total
Financial year ended 31 December 2024 Net book value
Initial Balance
0
-
0 Entries
-
Depreciation expense
0
-
0 Outputs
0
-
0 Cumulative depreciation related to outflows
0
-
0
Sold final la 31st December , 2024
0
-
0
28
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
Cost
268.978
-
268.978 Accumulated depreciation and amortization
268.978
-
268.978 Net book value
0
-
0
Intangible assets consist of computer programs. They are valued at cost, minus cumulative depreciation.
8 FINANCIAL INSTRUMENTS BY CATEGORY
All the financial assets of the Company are in the category of receivables. Their book value is shown below:
31st December 2025
31st December 2024
Customers and other receivables
291.126 554.756 Cash and cash equivalents (Note 12) 6.301.668 6.487.942
Total 6.592.794 7.044.120
All financial liabilities of the Company are financial liabilities accounted for on the amortized cost model. Their book value is presented below:
31st December 2025
31st December 2024
Loans - - Trade and other payables (excluding statutory obligations and Advance Revenue) 25.945 366.762
Total 25.945 366.762
9 CREDIT RISK FOR FINANCIAL ASSETS
The credit risk related to financial assets that are neither outstanding nor impaired can be
29
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
assessed in relation to the historical data regarding the default rate for third parties, as there are no independent external ratings for the Company's clients:
10 CUSTOMERS AND OTHER RECEIVABLES
31st December 2025
31st December 2024
Trade Receivables 910.326 1.242.256 Minus: adjustment for impairment of trade receivables -807.646 -802.073 Trade receivables – net 102.680 440.183 - of which in relation to related parties (note 26) 0 0 VAT to be collected 88.340,02 0 Advance payments 27.141 13.310 Advances granted to suppliers 30.143 45.809 Minus: provision for advance payments depreciation - - Different debtors 2.304 48.900 Other receivables 169.747 29.142
Current portion of trade receivables and other receivables 420.356
525.614
The ageing analysis of the trade receivables due but not impaired is as follows:
31st December 2025
31st December 2024
Between 1 and 3 months
306.859 Between 3 and 6 months
127.751 Over 6 months 910.326
807.646
Total 910.326
1.242.256
The book values of customers and other receivables of the Company are expressed in the following currencies:
31st December 2025
31st December 2024
30
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
RON 420.356
525.614
EUR 0
Total 420.356
525.614
10 CUSTOMERS AND OTHER RECEIVABLES (CONTINUED)
The movements of the Company's provisions for customer impairment and other receivables are as follows: 2025 2024
As of 1st of January , 807.646 802.073 Adjustments for impairment of receivables - 12 573 Amounts resumed during the period - 7.000
At the end of the period 807.646 807.646
11 STOCKS
31st December 2025
31st December 2024
Raw materials and materials - 1.022 Adjustments for raw materials and materials - - Production in progress - - Adjustments for products in progress - - Commodities - - Adjustments for the goods - - Finished products - - Adjustments for finished products - - Other Anomalous Stocks and Birds 400 400 Adjustments for other stocks - -
Total 400 1.422
31
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in Romanian lei, unless otherwise specified)
12 CASH AND CASH EQUIVALENTS
For the cash flow statement, cash and cash equivalents include the following:
31st December 2025
31st December 2024
Cash in the bank 6.297.371 6.481.953 - amounts in lei 6.296.224 6.480.418 - amounts in another currency 1.147 1.535
Restricted bank accounts
- - short-term - Lei
- -foreign currency - -
Cash in the house 4.297 5.989 - amounts in lei 4.271 5.963 - amounts in another currency 26 26
Bank deposits - - - amounts in lei - - - amounts in another currency - - Total cash or cash equivalent at the disposal of the Company 6.301.668 6.487.942
Restricted bank accounts Short-term / lei
-
Total 6.301.668 6.487.942
32
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in lei, unless otherwise specified)
13 CAPITAL SOCIAL
Shares
As of 31st December , 2024, the shareholding structure is as follows:
31st December , 2024 31st December 2024 31st December , 2024
Number of Actions Value of subscribed and paid-up capital (she)
The percentage of depreciation (%)
Herz Armaturen Ges M.B.H AUT Viena 21.292.448 2.129.244 53.2311
Heart fittings loc. Viena 13.197.352 1.319.735 32.9934
Individuals 5..008.900 500.891 12.5223 Legal Entities 501.300 50.130 1.2532
Total
40.000.000
4.000.000
100.0000
The total authorized number of shares is 40,000,000 shares with a net value of RON 0.1 per share.
As of 31st December , 2025, the shareholding structure is as follows:
31st December , 2025 31st December 2025 31st December , 2025
Number of Actions Value of subscribed and paid-up capital (she)
The percentage of depreciation (%)
Microfruits SA loc.Branesti jud.Ilfov 34.489.800 3.448.980 86.2245
Individuals 4.652.377 465.237 11.6309 Legal Entities 857.823 85.783 2.1446
Total
40.000.000
4.000.000
100.0000
The total authorized number of shares is 40,000,000 shares with a net value of RON 0.1 per share.
33
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in lei, unless otherwise specified)
14 SUPPLIERS AND OTHER DEBTS
31st December 2025
31st December 2024
Trade payables 25.362
23.328 - of which in relation to related parties (note 27)
- Settlements with capital associates 100
100 Personnel debts, contributions, social security 442
62.911 Value Added Tax -
- Corporate income tax liabilities (note 17)
- Other debts 41
95.972
25.945
182.321
Minus the long-term segment: -
-
Current portion of trade and other debts 25.945
182.321
15. LOANS
31st December 2025
31st December 2024 In the short term
Short-term loans - -
Long-term
Long-term loans - -
In 2021, SC ARMATURA SA received a notification from Herz Armaturen Ges.m.b.H informing them that they had concluded a contract with Koro Lando Real Estate SRL, which has as its object the assignment of the entire receivable that Herz Armaturen Ges.m.b.H has towards the undersigned Armatura SA, consequently The company offset the debt to the assignee Koro Lando Real Estate at the end of December 2021 with the claim against him resulting from the sale of buildings and land, so that on 31.12.2021 Armatura SA no longer registers debts from loans received or related interest.
34
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in lei, unless otherwise specified)
The loans are guaranteed as follows:
31st December 2025
31st December 2024
-
-
16. LEASING AND RIGHT TO USE ASSETS On 31st December , 2021, the Company had concluded a lease agreement with Koro Lando Real Estate SRL, for the rental of buildings and land, starting with December 16, 2021, until June 30, 2023. For this contract, the Company applied the treatment according to IFRS 16. Thus, the situation of the right to use leased assets, as of 31st December , 2024, is as follows:
Right of use Land and Buildings
Total
Cost Value as of 1st of January , 2024
2.413.846
2.413.846 Transfers -207.054
-207.054 Entries -
- Outputs -
- Value as of 31st December , 2024 2.206.792
2.206.792
Depreciation
Value as of 1st of January , 2024 1.706.072
1.706.072 Depreciation in Year 500.720
500.720 Value as of 31st December , 2024 2.206.792
2.206.792
Net book value -
- Thus, the situation of the right to use leased assets, as of 31st December , 2025, is as follows: Right of use Land and Buildings
Total
Cost Value as of 1st of January , 2025
2.206.792
2.206.792 Transfers -
- Entries 418.131
418.131 Outputs 2.624.923
2.624.923 Value as of 31st December , 2025 0
0
Amortization
Value as of 1st of January , 2025 2.206.792
2.206.792 Amortizare in year 203.646
203.646 Value as of 31st December , 2025 2.410.449
2.410.449
Net book value 0
0
35
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in lei, unless otherwise specified)
16. LEASING AND RIGHT OF USE OF ASSETS (continued)
The due date of the leasing payments at the end of 2025 is presented in the following table:
Maturity of leasing payments Total Value
Interest
Net Worth
Year 31.12.2025 -
-
-
Total
-
-
-
17. IMPOSITION ON CURRENT AND DEFERRED PROFIT
The analysis of receivables and liabilities regarding the deferred corporate income tax is presented as follows:
31st December 2025
31st December 2024
Deferred tax receivables:
– Deferred tax receivables to be recovered in less than 12 months 129.230
156.517 Deferred tax liabilities:
– Deferred tax liabilities
to be recovered in more than 12 months -
- to be recovered in less than 12 months
129.230
156.517
36
17. CURRENT AND DEFERRED INCOME TAX (continue)
The change in the receivables and liabilities regarding the corporate income tax deferred during the year, without taking into account the offsetting of the balances related to the same tax authority, is as follows:
As of 31st December , 2025
Provision for trade receivables
-170.586
170.546
-
-41
-
-
- Provision for inventory
-
-
- Provision for fixed assets
-
- Provision for unused holidays, provision reorganization and others
Payables for deferred tax
-
-
-807.646 Receivables regarding deferred tax
-978.232
170.546
-
-807.687
Effect of net deferred tax
-978.232
170.546
-
-807.687
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025 (in lei, unless otherwise specified)
Credited in comprehens ive income
0
37
(debited) / credited in Profit Account and loss
As of 31st December , 2024
-807.646
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
In determining the book and tax value of debts and receivables we have taken into account:
- under provisions the credit balance of account 151 "provisions" with the mention that the items representing adjustments to provisions have been taken into account when determining taxable profit;
- as regards the value of machinery in year 2025 there were no "Operating expenses on adjustments for depreciation of fixed assets" (account 6813);
- In establishing the book value of receivables we used the Closing debit balance of account 4111 + Closing debit balance of account 418 - Closing credit balance of account 491. When calculating the tax value at book value we added the future deductible amounts (credit balance of account 491).
Thus, the final debit balance of account 4412 representing a deferred corporate income tax claim is RON 129.229,84, and the amount of RON 27.287,24 (SF – SI) is recorded in the accounting by the accounting note: 692=441.02 27.287,24 The composition of the debit balance of account 4412 as of 31.12.2025 is:
- Receivable from Provisions = 40.50*16%=6.48 lei
- Receivables from customers = RON 129.229.82 lei.
17 CURRENT AND DEFERRED INCOME TAX (continue)
31st December 2025
31st December 2024
Initial balance -156.517
-161.464 Corporate income tax for the year
Corporate income tax payments during the year 27.287
-4.947
-
- Balance at the end of the year -129.230
-156.517
18. PROVISIONS FOR RISKS AND EXPENSES
Provisions for restructuring Other provisions Total As of 1st of January , 2025 0
145.216 25.370 170.586
As of 31st December , 2025 0 0 41 41
Provisions for guarantees granted to customers
1
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
(a) Other provisions
At the end of each period, the Company makes provisions for the value of the annual leaves not taken by its employees. The company also made provisions for possible penalties from suppliers due to delays in the payment of overdue commercial debts.
19. OTHER (LOSSES) / GAINS - NET
2025 2024
(Loss)/gain from tangible assets assignment - - (Cost) / reassignment of provision for inventories - - (Cost) / reassignment of provision for receivables - 5.573 Other net costs / gains
Total 0 5.573
20. OTHER OPERATING EXPENSES
2025 2024
Travel and daily allowance expenses 12.648 15.885 Rents -34.339 26 Insurance 5.377 3.308 Repairs and maintenance 39.872 34.799 Transport 11.000 10.406 Taxes and similar expenses 33.554 34.475 Advertising and protocol 27.643 21.264 Commissions and fees 202.340 66.144 Others 642.537 359.754
Total 940.634 546.061
21. PERSONNEL EXPENSES
2
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
2025 2024
Salaries and allowances 614.622 801.051 Social security expenditure 13.072 19.618 Operating subsidies for the payment of personnel - - Total 627.694 820.669
21 PERSONNEL EXPENSES (continued)
Number of employees
2025 2024
Number of employees 2 6 Management staff 0 1 Administrative staff 2 2 Production staff 0 3
22 INCOME AND FINANCIAL EXPENSES
2025 2024
Interest expenses:
- Loans contracted from shareholders - - Expenditure on exchange rate differences 442 31 Income from exchange rate differences 0 508
Income and expenses with net exchange rate differences -442 477 -Interest expenses
420 265.417 - Interest income on short-term bank deposits 127.867 6.329
Net interest income and expenses 127.447 259.088
Financial income and expenses, net 127.005 258.611
3
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
23. 23 INCOME TAX
2025 2024
Current tax:
Current tax on profit for the year - -
Total current tax - -
Deferred tax (note 16): -156.517 -161.464 Occ Temporary difference occurrence and reassignment 27.287 4.947
Total deferred tax -129.230 -156.517
Income tax cost - -
24. REVENUE BY CATEGORY
Revenue analysis by category 31st December 2025
31st December 2024
Sales of goods 23.316
12.656 Revenue from services 916.856
1.714.907
940.172
1.727.563
Analysis of revenues by geographical areas 31st December 2025
2024
Intra-Community Sales - Europe -
- Internal revenue 940.172
1.727.563
940.172
1.727.563
25. CONTINGENCIES
(a) Litigation
4
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
The company has disputes with commercial partners, resulting in the normal course of the and with former employees. The Company's management believes that these actions will not have a material adverse effect on the Company's economic results and financial position.
Most of the disputes refer to the recovery of debts from companies that are in insolvency proceedings and for which the company has already created provisions in previous years.
b) Taxation
All amounts due to the State for taxes have been paid or recorded at the date of the financial statements. The tax system in Romania is being consolidated and harmonized with the European legislation, and there may be different interpretations of the authorities in relation to the tax legislation, which can give rise to additional taxes, fees and penalties. If the state authorities discover violations of the legal provisions in Romania, they may determine, as the case may be: confiscation of the amounts in question, imposition of additional tax obligations, application of fines, application of late payment increases applied to the actual remaining payment amounts). Therefore, the tax penalties resulting from violations of the legal provisions can reach significant amounts to be paid to the State. The company considers that it has paid on time and in full all taxes, penalties and penalty interest, as the case may be. The The Romanian tax authorities carried out controls on the calculation of corporate income tax until 31.12.2008. In the period 15.12.2020-19.01.2021 the Tax Authorities carried out an unannounced control in order to comply with the measures established by the Court of Accounts for the 2015-2019 limitation period based on the list of companies that recorded a tax loss in a period of 5 consecutive years. At the end of the audit, no legal violations or measures to be taken regarding the calculation of corporate income tax were mentioned
Transfer pricing
In accordance with the relevant tax legislation, the tax assessment of a transaction made with related parties is based on the concept of market price related to that transaction. On the basis of this concept, transfer pricing must be adjusted to reflect market prices that would have been established between entities between which there is no affiliate relationship and which act independently, on the basis of 'normal market conditions'.
In October 2021, the company prepared the transfer pricing documentation in relation to related parties for the financial years 2016-2020.
(b) Financial crisis
5
ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
Recent volatility of international and Romanian financial markets:
The current global liquidity crisis that began in mid-2007 has resulted, among other things, in low levels of capital market funding, low levels of liquidity in the banking sector and occasionally, higher rates on interbank lending and very high volatility on stock exchanges. At present, the full impact of the current financial crisis is impossible to fully anticipate and prevent.
Management cannot reliably estimate the effects on the Company's financial position of the further decrease in the liquidity of the financial markets and the increase in the volatility of the exchange rate of the national currency and the capital markets indices. The management considers that it has taken all necessary measures to ensure the continuity of the Company in the current conditions.
Impact on liquidity:
The volume of financing in the economy has been significantly reduced lately. This may affect the Company's ability to obtain new loans and/or refinance existing loans on terms and conditions similar to previous financing.
Impact on customers/lenders:
Clients and other debtors of the Company may be affected by market conditions, which may affect their ability to repay amounts due. This may also have an impact on the Company's management's forecasts regarding cash flows and on the assessment of the impairment of financial and non-financial assets. To the extent available, management has adequately reflected revised estimates of future cash flows in its assessment of impairment.
26.TRANSACTIONS WITH RELATED PARTIES The Company has not carried out transactions with the following related parties:
Sales of goods and services
2025
2024
Sales of goods 24.229-
- Shareholder -
- Entities under common control with the shareholder -
- Sales of services -
- Shareholder -
- Entities under common control with the shareholder -
- Total 24.229-
-
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ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
Compensation granted to key management personnel
Key management personnel include directors (executive and non-executive) and members of the Board of Directors. The compensation paid in 2022 and 2023 to key management personnel for their services as employees is presented below:
2025
2024 Members of the Board of Directors -
- Management staff 148.259 216.453
Our company prepared the financial statemens as of 31/12/2025 in electronic xhtml format in accordane with the requirements of the ESEF Regulation.
27. EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE
There were no other events subsequent to the balance sheet date to report.
The financial statements were signed today
Administrator, Drawn up,
Racovita Adrian Ec. Rus Dana
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ARMᾸTURA SA NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER , 2025 (in lei, unless otherwise specified)
ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
MANAGEMENT REPORT
2025
Company facts:
Registered office: 400267 Cluj-Napoca. Gării Street. No. 19 Phone: +40 264 435 360 Fax: +40 264 435 368 Email: office@armatura.ro Website: www.armatura.ro Unique registration code: RO 199001 Trade Register number: J 12/13/1991 Subscribed and paid-up share capital: 4,000,000 RON The company has no branches.
Data about shareholders and issued shares:
Consolidated synthetic shareholder structure as of 31.12.2025, according to the information provided by the Central Depository:
Holder name Percentage % Microfruits SA locBranesti jud.Ilfov 86.2245 Individuals 11.6309 Legal Entities 2.1446 Total 100.00
The regulated market on which the issued securities are traded: Bucharest Stock Exchange.
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
The main characteristics of the securities issued by the company:
Number of shares: 40,000,000; Nominal value: 0.1 RON/share; The registered shares, issued in dematerialized form, are registered in the independent register of SC Depozitarul Central SA;
There are no schemes for granting shares to employees; There are no restrictions on voting rights; There are no known shareholder agreements that are known to the entity and that may result in restrictions on the transfer of securities and/or voting rights; The appointment or replacement of the members of the board of directors and the amendment of the entity's articles of incorporation shall be made with the approval of the General Shareholders' Meeting.
Corporate governance:
The company has shares listed on BVB Bucharest. As a result, the company applies all the legal provisions in force: Law 31/1990 updated, OMFP 2844/2016 for the approval of the Accounting Regulations according to the International Financial Reporting Standards, ASF Regulation 05/2018 on reporting, Law 297/2004 on the capital market, BVB regulations and others. All these acts are public. As of the date of preparation of this report, the Company has not adhered to the Corporate Governance Code issued by the Bucharest Stock Exchange in 2015. The company has implemented an Organization and Functioning Regulation as well as an Internal Order Regulation that are meant to ensure the operation within the safety parameters and to contribute to the fulfillment of the company's objectives. The internal control system meets its proposed objectives and no significant deficiencies have been found in the functioning of the internal system. The principles of the internal control system implemented are the separation of decisions, the existence of automatic controls incorporated into the computer application, authorization limits, periodic reporting, etc. The company has appointed an internal auditor but not an audit committee. There is no separate investor relations department. The company has a contract with an authorized financial auditor, according to the legal requirements, who verifies the financial statements according to the legal provisions in force. The General Meeting has the attributions provided by Law 31/1990 with the related amendments and by the company's articles of incorporation in force on the date of the General Meeting. The manner of conducting the general meeting of shareholders and its key attributions are in accordance with the legislation in force and with the company's Articles of Association. The rights of shareholders and the manner in which they can be exercised are provided for in the applicable legislation.
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
Composition of the Board of Directors:
- Racovita Adrian- member - Racovita Florin – member - Ghibaldan Cristina – member - Panici Alexandru - member - Bohaltianu Ionut - member
Activity data:
The object of activity of SC Armatura SA: "Manufacture of faucets".
Presentation of financial statements:
The documents regarding the economic and financial operations related to the reporting period were correctly registered, in compliance with the accounting principles, rules and accounting methods provided by the regulations in force.
The rules for preparing the financial statements, provided in Law no. 82/1991 and the Order of the Ministry of Public Finance no. 2844/2016, the data recorded in the Statement of Financial Position correspond to the data recorded in the accounting and are in accordance with the real situation of the patrimonial elements.
The statement of comprehensive income accurately reflects the revenues, expenses and financial results of the reporting period.
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
Elements of the Statement of Financial Position:
Nr. Rd. Indicator Name Balance at 31.12.2025 31.12.2024
FIXED ASSETS
1 Intangible assets 0 0
2 Tangible assets 17.130 111.785
3 Right to use leased assets 0 0
4 Financial assets - -
5 FIXED ASSETS - TOTAL (rd. 01 to 04) 17.130 111.785
ACTIVE CIRCULATING
6 Stocks 400 1.422 7 Receivable 263.985 541.445
8 Chelt in avans 27.141 13.310
9 House and bank accounts 6.301.668 6.487.942
10 ACTIVE CIRCULATING - TOTAL (rd. 06 to 09) 6.593.194 7.044.120
11 Deferred corporate income tax receivables 129.230 156.517
12 TOTAL ACTIVE(rd 5 + rd 10 + rd.11) 6.739.554 7.312.422
EQUITY AND DEBTS
EQUITY
13 Capital Social 18.110.957 18.110.957
14 Reserves 1.304.075 1.304.075
15 Retained earnings -12.701.423 -11.408.522
16 EQUITY – TOTAL (rd 13 to 15) 6.713.609 6.945.660
DEBT
17 LONG-TERM DEBTS 0 0
18 SHORT-TERM LIABILITIES and PROVISIONS 25.945 366.762
19 TOTAL DATORII (rd 17 + rd 18) 25.945 366.762
20 TOTAL EQUITY AND LIABILITIES (rd 16 + rd 19) 6.739.554 7.312.422
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
Inventory analysis:
As of 31.12.2025, the company has stocks worth 400 lei. Animals and birds 400 lei
The average duration of inventory rotation calculated as the ratio between the average stock and the turnover is presented as follows:
- Raw. Material 400 lei
DMRmp = average stock sqm / CA * 360 days
2022: DMRmp = -not calculated 2023: DMRmp -not calculated 2024: DMRmp = (0+1.022)/2/1.727.563 *360 zile=0.106 zile 2025: DMRmp = not calculated
Analysis of receivables:
As of 31.12.2025, the company's receivables in the amount of RON 263.985 had the following structure:
Valoare % in total Lei Commercial creation:
132.823
50.31 % Other receivables
131.162
49.69 %
Average duration of receivables collection:
DM ic = [(receivables at the beginning of the period + receivables at the end of the period) / 2] / CA * 360 days
2023: MD ic = [(391,502 + 322,279) / 2] /1,821,867 * 360 days = 70.52 days 2024: MD ic = [(322,279+ 434.610) / 2] /1,727,563 * 360 days = 78.86 days 2025: DM ic = [(434.610+ 102.681) / 2] /940.172 * 360 zile = 102.86 days
At the end of 2025, the company has made provisions, from previous years, for the depreciation of trade receivables in the amount of RON 807.646.
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
Analysis of payment obligations:
The company's payment obligations as of 31.12.2025 have the following structure:
Category
Sold in lei
Suppliers
3.340 Settlements with capital associations
100 Personnel debts and related social contributions
22.020 Value Added Tax
Current profit tax - Other debts
485 TOTAL
25.945
Analysis of loans and other loans:
The company no longer holds loans.
Comprehensive income statement as of 31.12.2025
The statement of comprehensive income as of 31.12.2025 includes: net turnover, income and expenses for the year, grouped by nature, as well as the result for the year.
Crt. No. Indicator Name Financial year : 31.12.2025 31.12.2024 1 Net turnover 940.172 1.727.563 2 Operating profit Profit - -
Loss 916.461 240.841 3 Financial result Profit 127.005 265.448
Loss - - 4 Gross Profit
17.770
Loss 789.456 - 5 Current and deferred profit tax 27.287 4.947 6 Net Profit Result
12.823
Loss 816.743 -
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ARMᾸTURA SA
ANNEX A : ADMINISTRATORS' REPORT
Risks and uncertainties:
The company's management constantly identifies, analyzes and develops strategies to combat the risks to which the company is exposed in the course of its activity.
Given that a significant portion of the Company's sales were directed to exports, a risk of the Company that was carefully monitored was represented by currency risk. Starting with 2021, when the Company carries out the activity of sub-leasing the premises, this risk is no longer applicable, the clients being predominantly internal.
Due to the general economic environment, liquidity risk and cash flow risk was a topic of increased interest for the company's management and an attempt was made to find optimal solutions to combat these risks, which included, among others: analysis of bond maturities, efforts in debt recovery, optimal use of banking resources, etc.
On December 14, 2021, the sale-purchase contract authenticated with the number 9617/14.12.2021 by the Professional Notarial Society Gorun & Associates was concluded, through which ARMĂTURA SA sold the properties it owned, located in Cluj-Napoca, str. Gării, nr. 19, Cluj County, to the company KORO LANDO REAL ESTATE SRL. The sale was made based on the Decision of the Extraordinary General Meeting of Shareholders of Armatura S.A. no. 3/25.04.2019, published in the Official Gazette of Romania, Part IV, no. 2351/05.06.2019. The sale price is the equivalent in lei of the amount of EUR 9,500,000, at the NBR exchange rate on the day of payment. As a result of the sale of the properties, Armatura SA fully compensated the loan in the amount of EUR 5,000,000 owed to the transferee Koro Lando Real Estate and the related interest, with the claim resulting from the sale of the properties.
Starting from 10.10.2025 the main shareholder is Microfruits SA ,that have acquired from HERZ ARMATUREN Ges.m.b.H Austria 86.2245% of the total shares.
Significant events after the end of the financial year
There were no other events subsequent to the balance sheet date to report.
Cluj Napoca
Administrator, Racovita Adrian
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S.C ARMĂTURA S.A 400267 Cluj-Napoca, str. Gării, nr.19 Tel : +40 371 784 884, Fax +40 0371 784 881 E-maill: office@armatura.ro, web: www.armatura.ro RC J12/13/1991 CUI RO199001 IBAN RO46 RZBR 0000 0600 0719 0369 RAIFFEISEN BANK Cluj-Napoca Capital social 4.000.000 ron
Statement according to the provisions of art. 30 of the Accountancy Law no. 82/1991
Were drafted the annual financial statements on 31.12.2025 For: SC Armatura SA, County: 12 – Cluj Address: Cluj-Napoca, Str. Garii, Nr. 19 Trade Register Number: J12/13/1991 Ownership Form: 34 – Joint Stock Companies Main Activity (NACE code and class name): 2814 – Manufacture of other taps and valves Fiscal Identification Code: RO 199001
I, undersigned Racovita Adrian, administrator of SC Armatura SA, hereby take full responsibility for the drafting of the annual financial statements on 31.12.2025 and hereby confirm that:
a. The annual financial statements on 31.12.2025 were drafted according to the International Financial Reporting Standards (IFRS) and the Order of the Minister of Finances 2844/2016. b. The accountancy policies used in drafting the annual financial statements comply with the applicable accountancy regulation. c. The annual financial statements offer a true image of the financial position, financial performance and other information regarding the deployed activity. d. The legal entity deploys its activity under continuity conditions.
Signature, Racovita Adrian
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INDEPENDENT AUDITOR'S REPORT
To,
ARMĀTURA S.A. COMPANY SHAREHOLDERS
Report on the financial statements
OPINION
We audited the attached individual financial statements of the company ARMĂTURA S.A.(”Society”), with headquarters in Cluj - Napoca, Str. Gării no. 19, registered at the Trade Register under no. J12/13/1991, tax registration code RO 199001, drawn up in accordance with the Order of the Minister of Public Finance no. 2844/2016 for the approval of the Accounting Regulations in accordance with the International Financial Reporting Standards ("OMFP no. 2844/2016") with the amendments and clarifications subsequent ones, which include the statement of the financial position as of December 31, 2025, the statement of the overall result, the statement of cash flows, the statement of changes in equity for the financial year ended on this date and a summary of significant accounting policies as well as other Explanatory Notes.
The mentioned financial statements refer to:
• Net assets/Total equity 6,713,609 lei
• Financial year result / Net loss - 816,743 lei
In our opinion, the financial statements of ARMĂTURA S.A. faithfully presents under all significant aspects the financial position of the company on December 31, 2024, its financial performance and cash flows for the exercise ended on this date, in accordance with the Order of the Minister of Public Finance no. 2844/2016 for the approval of the Accounting Regulations in accordance with the International Financial Reporting Standards ("OMFP no. 2844/2016") with subsequent amendments and clarifications.
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Basis for opinion
We conducted our audit in accordance with International Auditing Standards ("ISA"), EU Regulation no. 537/2014 of the European Parliament and Council of April 16, 2014 (hereinafter "the Regulation") and Law no. 162/2017 ("The law''). Our responsibilities under these standards are described in detail in the “Auditor's Responsibilities in an Audit of Financial Statements” section of our report.
We are independent from the Company, according to the Code of Ethics for Accounting Professionals issued by the International Ethics Standards Board for Accountants (IESBA code), according to the ethical requirements that are relevant for the audit of financial statements in Romania, including the Regulation and the Law, and we have fulfilled ethical responsibilities under these requirements and under the IESBA Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matters
We draw attention to the fact that during the 2025 financial year several significant events were reported that had a substantial impact on the Company's activity. In accordance with ASF Regulation No. 5/2018, these events were reported to the Financial Supervisory Authority (ASF) and were also published on the Company’s website.
Among the significant events that took place within ARMĂTURA S.A. during 2025, which in our view had a substantial impact on the Company’s activity, are the following:
• The transfer of 86.2245% of the shares of ARMĂTURA S.A. and the voting rights attached to the shares held by Herz Armaturen Ges.m.b.H. Vienna/Austria to MICROFRUITS S.A.,Brănești, County Ilfov/ Romania, as reflected in the consolidated synthetic structure of financial instrument holders as at 31 December 2025 issued by Depozitarul Central.
• The notification dated 13.10.2025 through which the directors of ARMĂTURA S.A. informed the Company of their resignation from their mandates as directors, without any pecuniary or other claims against the Company, effective from 14.10.2025.
• According to the report issued on 13.10.2025 , submitted to the Financial Supervisory Authority and published on the Company’s website, the Board of Directors of ARMĂTURA S.A., convened on 13.10.2025, unanimously decided to revoke the former Chief Executive Officer and to appoint a new Chief Executive Officer for a three-year term, beginning on 13.10.2025.
• According to the Ordinary General Meeting of Shareholders (OGMS) reconvened on 21.11.2025, the following decisions were adopted: the resignation of the members of the Board of Directors of the Company; the approval of a Board of Directors composed of five members, effective from the date of adoption of the resolution of the Ordinary General Meeting of Shareholders, for a four-year term, representing valid votes cast by shareholders: 13,200,000 votes, representing 33% of the total share capital and 100% of the share capital present.
• The termination, starting with 01.10.2025, of the sole lease agreement no. 1/16.12.2021 regarding certain commercial and industrial premises owned by KORO LANDO REAL ESTATE SRL and concluded between ARMĂTURA S.A. and KORO LANDO REAL ESTATE SRL (the lessor). The above-mentioned lease agreement represented the Company’s main source of revenue through the sublease of those commercial and industrial premises to other companies generating rental income.
Going Concern Principle
• Based on the matters described above, we draw attention to the existence of a material uncertainty related to events and conditions that may cast significant doubt on the Company’s ability to continue as a going concern, in accordance with ISA 570 (Revised) if the company ARMĂTURA S.A. does not have a plan o ensure the continuity of the activity assumed by the Board of Directors of the company to obtain operational income to support the activity and existence of the Company in the future.
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• We have obtained confirmation that the company continues its efforts to regularize the current situation through Decision no. 1/19.03.2026 of the Chairman of the Board of Directors of ARMĂTURA S.A., whereby the company’s management will act with prudence and responsibility in order to preserve the company’s assets, with the fundamental objective of ensuring the continuity of its operations.
• The economic climate, together with the uncertainties generated by the geopolitical context related to the Russian invasion of Ukraine, the international restrictions imposed on Russia and Belarus, as well as the energy crisis, implicitly gives rise to risks concerning the possibility of unpredictable developments affecting the Company’s economic and financial indicators, such as: interruption of energy supply, significant price fluctuations, disruption of distribution chains, intensification of cyberattacks, increased borrowing costs, or restricted access to financing.
• The management of the Company’s financial situation depends on how management addresses the future socio- economic events and conditions presented in the challenging environment in which the Company operates.
Our audit opinion does not contain a qualification regarding the mentioned matters.
Key Audit Matters
Key audit matters are those matters that, based on professional judgment, had the greatest importance in performing the audit of the financial statements and were addressed in the context of the audit of the financial statements as a whole and in forming our opinion on them, and we do not provide a separate opinion with regarding these key aspects.
Key audit matters Approach within the audit mission
Assessment of the Going Concern Assumption
The Company’s economic activity as a whole has been significantly reduced compared to previous years, which required the performance of additional audit procedures in order to enable the issuance of the audit opinion.
Our audit procedures consisted primarily of the following:
• evaluating the Company’s assumptions regarding the going concern basis for a period of at least 12 months from the balance sheet date.
• evaluating and testing the key financial indicators related to the Company’s ability to continue its operations.
The issuance of an audit opinion involved the identification of values and amounts that significantly influence the figures presented in the annual financial statements and which fall within the category of items requiring additional audit procedures in order to reduce audit risk.
• reviewing the assets identified as at 31.12.2025 and assessing them with respect to the Company’s capacity to generate cash flows in order to obtain future economic benefits.
• the Company’s ability to undertake all necessary steps to identify a strategic development partner, with a view to initiating new projects and supporting the Company’s development over the medium and long term, as per Board of Directors Decision no. 1 dated 19.03.2026, as well as the significant judgments made by management as part of its assessment of the Company’s ability to continue as a going concern.
The Company’s shares are listed on the Bucharest Stock Exchange. Consequently, the Company must comply with all applicable legal provisions in force, including:
• Law No. 31/1990, as amended and updated; • Order of the Ministry of Public Finance No. 2844/2016 approving the Accounting Regulations in accordance with International Financial Reporting Standards; • ASF Regulation No. 5/2018 regarding reporting obligations; • Law No. 297/2004 regarding the capital market; • The regulations issued by the Bucharest Stock Exchange, etc.
• evaluating management’s assessment of the significance of events or conditions related to the Company’s ability to meet its obligations.
• obtaining and evaluating the responses received from the Company’s management and discussing with management the potential exposures. In this regard, particular attention was given to the analysis of the Company’s development strategy for the upcoming period.
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Management's responsibilities for financial statements
The management of the company is responsible for the preparation and faithful presentation of these financial statements in accordance with the Order of the Minister of Public Finance no. 2844/2016 and with the policies described in the notes to the financial statements.
This responsibility includes: designing, implementing and maintaining an internal control relevant to the preparation and faithful presentation of financial statements that do not contain significant distortions due to fraud or error; selection and application of appropriate accounting policies; the development of reasonable accounting estimates in the given circumstances.
In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, for presenting, if applicable, the going concern aspects and for using accounting on a going concern basis, unless management either intends to liquidate the Company or cease operations, or has no other realistic alternative.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
Auditor's responsibilities in an audit of financial statements
Our responsibility is to express an opinion on these financial statements, based on the audit performed. We performed the audit according to the International Auditing Standards adopted by the Romanian Chamber of Financial Auditors. These standards require that we comply with the Chamber's ethical requirements, plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatement.
Our objectives are to obtain reasonable assurance about whether the financial statements, taken as a whole, are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement, if any. Misstatements can be caused either by fraud or error and are considered material if it can reasonably be expected that they, individually or cumulatively, will influence the economic decisions of users, taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. Also:
• We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures in response to those risks, and obtain sufficient appropriate audit evidence to provide a basis for our opinion. The risk of not detecting a material misstatement due to fraud is higher than that of not detecting a material misstatement due to error, because fraud may involve collusion, forgery, intentional omissions, misrepresentations and avoidance of internal control.
• We understand the internal control relevant to the audit, in order to design audit procedures appropriate to the circumstances, but without the purpose of expressing an opinion on the effectiveness of the Company's internal control.
• We evaluate the adequacy of the accounting policies used and the reasonableness of the accounting estimates and related information presentations made by the management.
• Form a conclusion on the appropriateness of management's use of going concern accounting and determine, based on the audit evidence obtained, whether there is a significant uncertainty about events or conditions that could cast significant doubt on the ability Company to continue its activity. If we conclude that a material uncertainty exists, we must draw attention in the auditor's report to the related disclosures in the financial statements or, if those disclosures are inadequate, modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditor's report. However, future events or conditions may cause the Company to stop operating on a going concern basis.
• We evaluate the presentation, structure and content of financial statements, including disclosures, and the extent to which the financial statements reflect the underlying transactions and events in a manner that results in a fair presentation.
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We communicate to those charged with governance, among other things, the planned scope and timing of the audit, as well as key audit findings, including any significant internal control deficiencies, that we identify during the audit.
Other legal and regulatory provisions
We were appointed by the General Meeting of Shareholders to audit the financial statements of the company for the financial year ended on 31.12.2025.
The total uninterrupted duration of our commitment is one year, covering the financial year ending on 31.12.2025.
We have not provided prohibited non-audit services for the company, referred to in art. 5 paragraph (1) of Regulation EU no. 537/2014 of the European Parliament and of the Council, and we remain independent from the company during the audit.
Other aspects
This report of the independent auditor is addressed exclusively to the shareholders of the company as a whole. Our audit was carried out in order to be able to report to the shareholders of the company those aspects that we have to report in a Financial Audit report, and not for other purposes. To the extent permitted by law, we do not accept or assume responsibility except to the company and its shareholders, as a whole, for our audit, for this report or for the opinion formed.
The attached financial statements are not intended to present the financial position, results of operations and cash flows of the company in accordance with the requirements of the International Financial Reporting Standards. Therefore, the attached financial statements are not prepared for the use of people who do not know the accounting and legal regulations in Romania, including O.M.F.P. no. 2844/2016.
The partner of the audit mission on the basis of which this report was drawn up is Sergiu Cobîrzan.
Other information – Report of Administrators
Administrators are responsible for the preparation and presentation of the Administrators' Report in accordance with the requirements of the O.M.F.P. no. 2844/2016, points 15 – 19, which do not contain significant distortions and for that internal control that the management considers necessary to allow the preparation of the administrators' report which does not contain significant distortions, due to fraud or error.
In accordance with the Order of the Minister of Public Finance no. 2844/2016, we examined the Administrators' Report, attached to the financial statements. The administrators' report is not part of the individual financial statements.
Our opinion on the individual financial statements does not cover the directors' report.
In connection with our audit of the financial statements for the financial year ended, we have read the Directors' Report attached to the financial statements and state that:
• In the administrators' report, we have not identified any information that is not consistent, in all significant
aspects, with the information presented in the attached individual financial statements;
• The administrators' report identified above includes, in all material respects, the information required by
O.M.F.P. no. 2844/2016, points 15-19;
• Based on our knowledge and understanding acquired during the audit of the financial statements for the financial year ended on 31.12.2025 regarding the Company and its environment, we have not identified any information included in the Directors' Report that is significantly erroneous.
Regarding the Remuneration Report, based on our knowledge and understanding of the Company and its environment, acquired during the audit of the individual financial statements for the financial year ended on December 31, 2025, we
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report that it has been drawn up, in all aspects significant, in accordance with the provisions of Law 24/2017, paragraphs 106-107, and we have not identified significant distortions in the manner of its preparation.
ec. Sergiu COBIRZAN – Financial auditor
Registered in the Public Register of auditors financial and audit firms with AF number 4517
On behalf of
PREMIER CLASS AUDIT S.R.L. Registered in the Public Register of auditors
financial and audit firms with number FA 1195
Cluj Napoca, 22.04.2026
PREMIER CLASS AUDIT S.R.L. CIF: RO32310697, J2013002994127 Pompiliu Teodor Street no. 1, Cluj-Napoca, County Cluj, Romania
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