Identification of indications to verify the recoverable amount of Polish and international assets of the KGHM Polska Miedź S.A. Group

Wednesday, 17 February, 2021

The Management Board of KGHM Polska Miedź S.A. (“the Company”) announces that as a result of reviewing the technical and economic parameters of key international mining assets belonging to the KGHM Polska Miedź S.A. Group and current forecasts of pricing paths of commodities, indications of a possible change in the recoverable amount of the Franke mine was identified.

Moreover, as a result of reviewing the economic parameters of Polish assets belonging to subsidiaries in the context of current macroeconomic conditions, indications of possible impairment of the recoverable amount of a part of these assets was identified.

As a result, pursuant to IAS 36, it obliges the Company to conduct tests for impairment as at the end of the last reporting period, i.e. 31 December 2020 in order to estimate the recoverable amount with respect to:

1) International assets:
    a) the Franke mine,
2) Polish assets:
    a) assets of KGHM Polska Miedź S.A. in the form of shares in subsidiaries and Investment Certificates of Funds managed by KGHM TFI S.A. (to be recognised in the separate financial statements of KGHM Polska Miedź S.A.),
    b) assets of units described in letter a), including shares in portfolio companies of Funds and their assets (to be recognised in the consolidated financial statements of the KGHM Polska Miedź S.A.),
in which indications of possible impairment were identified.

For other international mining assets and Polish assets, indications to conduct tests have not been identified. The results of the tests will be disclosed by the Company in a separate regulatory filing.

Legal basis: Art. 17 (1) of MAR (Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (Official Journal of the European Union dated 12 June 2014, no. L 173/1)

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