In this report, we continue to report on IMC’s revision of the company’s valuation and financial forecasts. In the auditor’s opinion, recently released results for 2021 provide a true and fair view of IMC’s financial position, but reveal material uncertainty about its ability to operate. continuity of the IMC. In our view, it is currently impossible to predict how the war in Ukraine will unfold, so the following report, including financial projections, corresponds to a single, hypothetical scenario. determined that military operations do not return to the regions of Ukraine where the IMC carried out its operations. However, taking into account the development of events ahead, the interests of the parties to the conflict are broadly defined, the macroeconomic situation is constantly changing, including the crisis in supply of energy materials, the realization of a scenario different from what we assume is highly probable. In addition to changes in business-only assumptions (sales volume, price), our assessment requires updating the cost of capital assumptions, resulting from bond yields. Ukrainian bonds rose sharply to 10 years (from 7% ago to 30% in 2022-23) as well as the equity risk premium (from 8% previously to 20% in 2022-23, followed by ten%). It was the change in the cost of capital that was responsible for the largest drop in IMC’s DCF valuation, compared to the September 2021 report. For the purposes of this report, we assume the scenario blockade of Ukrainian ports has been lifted. only for the year 2023 r., so we see that IMC sales numbers are severely limited until the end of the current year. Financial results we expect from IMC in 2022 r. gains arising from changes in the fair value of biological assets and is accounted for using the accrual method. Starting in 2023, we expect the company to be able to plant 100% of the coastal land after clearing mines on about 27% of the company’s fields. We would like to reiterate and emphasize once again that our assumptions represent a specific scenario with respect to the situation in Ukraine and we see significant risks on both sides of our assessment. ours. Lifting the blockade of Ukraine’s ports, which may not equate to ending the war, would improve IMC’s cash flow. On the other hand, a breakthrough by the Russians on the front lines could lead to further disruptions in grain exports and thus pricing below our target price. Valuation Forecasts and Updates Financial Forecast Updates In this report, we change our financial forecast for IMC mainly due to updated fundamental assumptions regarding grain prices, area sown area and sales volume. After driving the Russians out of the Poltawa, Sumy, Czernichov and Charkow regions, the main problem of Ukrainian agribusinesses was the disruption of exports. However, the Russian fleet controlled the Black Sea while the drifting mines posed an additional threat to the ships. Rail transport is inadequate due to limited capacity, high unit costs and competition from metal products that make up a significant share of Ukraine’s exports. In March, Ukraine exported only 0.35 kt of grain. In May, exports reached 1.7 million and in June 2 million, only 50% of the pre-war baseline. On top of that, there are about 20 million grain reserves from previous years, which poses an additional problem. We assume that IMC’s grain sales from Q2 to Q FY22 will come in at approx. 20 kt per month compared to 60 kt per month before the war. This will result in a significant drop in sales, an increase in inventory on the balance sheet, and, therefore, limited cash inflows. Our scenario assumes that from 2023, the blockade of Ukraine’s ports will be lifted and IMC will also be able to export current production and accumulated stocks. We emphasize that our base case carries risks for both sides. For example, pressure from the largest grain importers such as Turkey makes it more likely that the port blockade will be lifted and this scenario may not equate to an end to the war. On the other hand, if Russia decides not to make concessions to other countries, at some point in the future limited sales by Ukrainian companies could lead to solvency problems and a strategic war. limited seeding epidemic in 2023. around the world, grain prices skyrocketed from 70% to 30- 0% of pre-war levels. From a USDA forecast perspective, the wheat market is expected to outperform the corn market due to lower expected inventories. In the case of corn, the US agency projects record harvests in Brazil and more self-sufficiency in China, which has so far not been confirmed in practice. Current grain price movements suggest the opposite (strong corn, weak wheat), possibly stemming from higher harvests in many countries, the start of the harvest season in general, and concerns about economic growth. . Compared to our September 2021 report, we assume approx. Standard price growth of 0%. Unfortunately, due to export disruptions, actual prices in the IMC can deviate significantly from the official reference price. The discount could come from higher transportation costs, as goods now have to travel by rail through Poland, Romania or Hungary and then reach the final buyer. Despite the Russian defeat on the Czernichov front, the IMC seeding operation on the entire coast was not possible due to the presence of mines and explosives left over from military operations. According to the official statement, IMC has managed to sow shifts. 73% of its land bank, which we believe will generate 30% of production in the reduced 2022 harvest season. Admittedly this will have a negative effect on next year’s sales, which on the other hand will be offset by cumulative stock sales throughout 2021/2022. It is worth mentioning this positive EBITDA result, which we believe IMC will announce in 2022 r. stemming from a positive reassessment of biology, which will occur to the greatest extent in Q2 2012. We emphasize that 2022 EBITDA returns will be derived from accruing accounting rules. and not equivalent to cash flow, which better reflects IMC’s financial position. Substantial EBITDA gains in 2022 will be accompanied by strong inventory growth,