$118$/ 5(3257 $1'),1$1&,$/...STELIOS S. ANASTASIADES Chief Executive Officer: ANTONIOSA. ANTONIOU...

Offices, Factory and Port, VassilikoΤ: +357 24 845 555, F: +357 24 332 651

Registered office and Postal Address1Α Kyriakos Matsis Avenue P.O.Box 22281 CY-1519 Nicosia - Cyprus

Τ: +357 22 458 100, F: +357 22 762 741E: [email protected], [email protected]

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ANNUALREPORTANDFINANCIALSTATEMENTS

ANNUAL REPORT AND FINANCIAL STATEMENTS 2018

Annual Report & Financial Statements '18 v

NOTICE OF ANNUAL GENERAL MEETING

ANNUAL REPORT AND FINANCIAL STATEMENTS

Officers,professionaladvisorsandbankers

StatementoftheMembersoftheBoardofDirectors

Managementreport

Corporategovernancereport

Remunerationreport Directors'CurriculaVitae

Independentauditors'report

Consolidatedstatementofprofitorlossandothercomprehensiveincome Companystatementofprofitorlossandothercomprehensiveincome

Consolidatedstatementoffinancialposition

Companystatementoffinancialposition

Consolidatedstatementofchangesinequity

Companystatementofchangesinequity Consolidatedstatementofcashflows Companystatementofcashflows

NOTES TO THE FINANCIAL STATEMENTS

CONTENTS

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Annual Report & Financial Statements '186

The53rdAnnualGeneralMeetingoftheshareholdersofVassilikoCementWorksPublicCompanyLtdwillbeheldatParklaneResort&Spa,inLimassol,on30May2019at5:00p.m.totransactthefollowingbusiness:

1. ConsidertheManagementreportoftheBoardofDirectorsfortheyear2018.2. Receive,considerandapprovetheannualfinancialstatementsandthereportoftheauditorsfortheyear

2018.3. Approveadividendpaymentof€0,12persharefortheyear2018.4. ElectnewDirectorsintheplaceofthosewhoretire.5. Approvetheremunerationreport.6. FixtheremunerationoftheDirectorsfortheyear2019.7. Re-appointKPMGLimitedastheauditorsoftheCompanyandfixtheirremunerationfortheyear2019.8. Transactanyotherbusinesswhich, inaccordancewith theCompany’sArticlesofAssociation, canbe

presentedattheAnnualGeneralMeeting. ByorderoftheBoard M. MAVRIDOU Secretary 11 April 2019

NOTICE OF ANNUAL GENERAL MEETING

Annual Report & Financial Statements '18 7

NOTES TO THE NOTICE OF THE ANNUAL GENERAL MEETING

ENTITLEMENT TO PARTICIPATE IN THE ANNUAL GENERAL MEETING

1. AnypersonappearingasashareholderintheRegisterofMembersoftheCompanyontherecorddateisentitledtoparticipateintheAnnualGeneralMeeting.Eachordinaryshareisentitledtoonevote.TherecorddatefordeterminingtherighttovoteattheAnnualGeneralMeetingis28May2019.Transactionswhichwillbetakingplaceon27May2019andthereafterwillnotbeconsideredindeterminingtherighttovoteattheAnnualGeneralMeeting.

2. AmemberentitledtoattendandvoteattheAnnualGeneralMeetingisentitledtoappointaproxytoattendandvoteonhisbehalf.Shareholdersmayappointanypersonastheirproxy.SuchproxyneednotbeamemberoftheCompany.Shareholderswhoappointaproxytovoteontheirbehalf,butwishtospecifyhowtheirvoteswillbecast,shouldticktherelevantboxesontheFormofProxy.

3. Theinstrumentappointingaproxy,whichwillbeavailableonthewebsiteoftheCompanywww.vassiliko.com

(underInvestorsRelations),mustbedepositedattheRegisteredOfficesoftheCompany(1A,KyriakosMatsisAvenue,4thFloor,CY-1082Nicosia,Cyprus,fax+35722762741)24hourspriortothecommencementofthebusinessoftheAnnualGeneralMeeting.

4. Ifsuchappointorisacompany,theFormofProxymustbearthenameofthecompany,andbesignedbyits

dulyauthorisedofficer/s.Inthecaseofjointshareholders,theFormofProxycanonlybesignedbythepersonwhosenameappearsfirstintheRegisterofMembers.ShareholdersshouldconfirmthattheformofproxyhasbeensuccessfullyreceivedbytheCompanybycalling+35722458100.

5. Shareholdersand/or theirproxieswhowillattendtheAnnualGeneralMeetingarerequestedtocarrywiththemtheiridentitycard,orotherproofofidentification.

6. Anycorporation,whichisashareholderoftheCompany,maybyresolutionofitsDirectorsorothergoverningbody,authorisesuchperson,asitthinksfittoactasitsrepresentativeatanymeetingoftheCompany,andthepersonsoauthorisedshallbeentitledtoexercisethesamepowersonbehalfofthecorporationwhichhe/sherepresents,asthatcorporationcouldexercise,ifitwereanindividualmemberoftheCompany.

VOTING PROCEDURES AT THE ANNUAL GENERAL MEETING

7. AttheAnnualGeneralMeetingaresolutionputtothevoteofthemeetingshallbedecidedonashowofhandsunlessapollis(beforeoronthedeclarationoftheresultoftheshowofhands)demanded:a. bytheChairman,orb. byatleastthreememberspresentinpersonorbyproxy,orc. byanymemberormemberspresentinpersonorbyproxyandrepresentingnotlessthanone-tenthofthe

totalvotingrightsofallthemembershavingtherighttovoteatthemeeting.d. byamemberormembersholdingsharesintheCompanyconferringarighttovoteatthemeetingbeing

sharesonwhichanaggregatesumhasbeenpaidupequaltonotlessthanone-tenthofthetotalsumpaiduponallthesharesconferringthatright.


NOTES TO THE NOTICE OF THE ANNUAL GENERAL MEETING (continued)

8. Ifapollisdemandedinthemanneraforesaid,itshallbetakeninsuchamanner,astheChairmanshalldirect,andtheresultofthepollshallbedeemedtobetheresolutionofthemeetingatwhichthepollwasdemanded.Thedemandforapollmaybewithdrawn.

SHAREHOLDERS RIGHTS AT THE ANNUAL GENERAL MEETING

9. Pursuanttoarticle127BofCompaniesLawCap113,shareholdersoftheCompanyhavetherighttoputanitemontheagendaoftheAnnualGeneralMeeting,providedthattheitemisaccompaniedbyawrittenexplanationjustifyingtheinclusionoftheitemortheproposedresolutionforapprovalattheAnnualGeneralMeetingprovidedthat:a. theshareholderorgroupofshareholdersholdatleast5%oftheissuedsharecapitaloftheCompany,

representingatleast5%ofthevotingrightsofshareholdersentitledtovoteatthemeetingforwhichanitemhasbeenaddedontheagenda,and

b. theshareholders’requesttoputanitemontheagendaorresolution(asdescribedabove)isreceivedbytheCompany’sSecretaryinhardcopyorelectronicallyattheaddressesindicatedbelowatleast42dayspriortotheAnnualGeneralMeeting.

VassilikoCementWorksPublicCompanyLimited1A,KyriakosMatsisAvenue,4thFloor,CY-1082Nicosia,[email protected]

10.Pursuanttoarticle128CoftheCompaniesLawCap113,shareholdershavearighttoaskquestionsrelated

to itemsontheagendaandtohavesuchquestionsansweredbytheBoardofDirectorsof theCompanysubjecttoanyreasonablemeasurestheCompanymaytaketoensuretheidentificationofshareholders.

OTHER INFORMATION AND AVAILABLE DOCUMENTS

11.Asat11April2019,theissuedsharecapitaloftheCompanyis€30.932.457dividedinto71.935.947ordinarysharesofnominalvalue€0,43each.

12.TheAnnualReport andFinancial Statements of theCompany for 2018 (incorporating theNotice to andtheAgenda of theAnnual General Meeting, Explanatory Notes on theAgenda Items, theManagementReport,theCorporateGovernanceReport,theRemunerationReport,theAuditors’ReportandtheFinancialStatements),andtheFormofProxyshallbemadeavailableinelectronicformonthewebsiteoftheCompanywww.vassiliko.com(InvestorRelations)andinhardcopyattheCompany’sRegisteredOffices,1AKyriakosMatsisAvenue,4thFloor,1082Nicosia.


NOTES TO THE NOTICE OF THE ANNUAL GENERAL MEETING (continued)

EXPLANATORY NOTESTheformalNoticeofthe2019AnnualGeneralMeetingissetoutonpage6.TheNoticeaskstheshareholdersofVassilikoCementWorksPublicCompanyLtdtoapproveanumberofitemsofbusiness.Foryourinformation,theexplanatorynotesbelowsummarisethepurposeofeachResolutiontobevotedonbyVassilikoCementWorksshareholdersatthisyear’sAnnualGeneralMeeting.

RESOLUTION 1: TO CONSIDER THE MANANGEMENT REPORT TheChairmanwillpresenttheManagementReportfortheyear2018tothemeeting.

RESOLUTION 2: TO RECEIVE, CONSIDER AND APPROVE THE ANNUAL FINANCIAL STATEMENTS AND THE REPORT OF THE AUDITORSTheChairmanwillpresenttheAnnualFinancialStatementsandKPMGLimitedwillpresenttheirAuditReportfortheyearended31December2018tothemeeting.

RESOLUTION 3: APPROVE A DIVIDEND PAYMENT FOR THE YEAR 2018TheDirectorsproposed thepaymentofadividend for2018,of€0,12 perOrdinaryShare. Ifapprovedat theAnnualGeneralMeeting,thedividendwillbepaidtotheentitledshareholdersregisteredasat12June2019(recorddate).TheshareoftheCompanywillbetradedex-dividendasof11June2019.Paymentofthedividendwillbemade(effected)tillthe9July2019.

RESOLUTION 4: RE-ELECTION OF DIRECTORSIn accordancewith thearticlesof associationMessrsGeorgeSt.Galatariotis,CharalambosPanayiotouandChristopheAllouchery,aretheDirectorswhowillretirebyrotationthisyearandofferthemselvesforre-electioninaccordancewiththeCompany’sArticlesofAssociation.

BriefdetailsofallDirectorsappearonpages25to29oftheAnnualReport.

RESOLUTION 5: APPROVE THE REMUNERATION REPORTTheShareholdersareaskedtoapprovetheremunerationreportthatappearsonpages23to24.

RESOLUTION 6: TO FIX THE REMUNERATION OF THE DIRECTORSTheShareholdersareaskedtoapprovetheremunerationoftheDirectorsfortheyear2019toremainthesameasforthepreviousyear,i.e.:€25.000fortheChairman€20.000foreachoftheDirectors€300attendancefeepermeetingheld

RESOLUTION 7: APPOINTMENT OF AUDITORSThisresolutionrelatestothere-appointmentofKPMGLimitedastheCompany’sauditorstoholdofficeuntilthenextAnnualGeneralMeetingoftheCompany,andtoauthorisetheDirectorstosettheirremuneration.


OFFICERS, PROFESSIONAL ADVISORS AND BANKERS

Directors: ANTONIOSA.ANTONIOU(ExecutiveChairman) GEORGEST.GALATARIOTIS COSTASST.GALATARIOTIS STAVROSG.GALATARIOTIS COSTASKOUTSOS CHARALAMBOSPANAYIOTOU MAURIZIO MANSI MONTENEGRO ANTONISMIKELLIDES CHRISTOPHEALLOUCHERY ANTONIOSKATSIFOS STELIOSS.ANASTASIADES Chief Executive Officer: ANTONIOSA.ANTONIOU Chief Financial Officer: GEORGES.SAVVASecretary: MARIAMAVRIDOU Independent Auditors: KPMGLIMITED 14,ESPERIDONSTREET 1087 NICOSIA CYPRUS

Legal Advisοrs: TASSOSPAPADOPOULOS&ASSOCIATES CHRYSSESDEMETRIADES&CO.LLC L.PAPAPHILIPPOU&COLLC LEONIDASG.GEORGIOU CHRISTYS&COLLC Bankers: ALPHABANKLTD BANKOFCYPRUSPUBLICCOMPANYLTD EUROBANKEFGCYPRUSLTD HELLENICBANKPUBLICCOMPANYLTD NATIONALBANKOFGREECE(CYPRUS)LTD NATIONALBANKOFGREECESA UBSSWITZERLANDAG Registered office: 1A,KYRIAKOSMATSISAVENUE CY-1082NICOSIA CYPRUS

Registered number: 1210

Internet website: www.vassiliko.com


MANAGEMENT REPORT

TheBoardofDirectorsofVassilikoCementWorksPublicCompanyLtd(the'Company')presentstothemembersitsmanagementreporttogetherwiththeauditedfinancialstatementsfortheyearended31December2018. FINANCIAL STATEMENTS Theconsolidatedfinancialstatementsfortheyear2018includetheresultsoftheholdingcompany,itssubsidiariesandassociatecompanies. PRINCIPAL ACTIVITIES TheGroup'sprincipalactivitiesaretheproductionofclinkerandcement,whicharedistributedinthelocalandoverseasmarkets.TheGroupalsohasapresenceinaggregatesquarryingthroughitsassociatedcompanies. REVIEW OF DEVELOPMENTS, POSITION AND PERFORMANCE OF THE OPERATIONS Therevenuefor2018reached€97.926.000comparedto€102.467.000for2017,showingadecreaseof4,4%. Year2018 resultswereaffectedbyhigherenergyandcarbonemissioncostswithan impactongrossprofitmargin.Electricitycosthadthemostnoticableimpact.Thecostofsolidfuelsalsoincreasedbuttheirimpactwasmoderatedthroughtheuseofalternativefuels.TheCompanyispursuingfurtheritsstrategytoreplacetraditionalsolidfosilfuelswithalternativesources,whichofferbothfinancialandenviromentalbenefitstotheCompany. FINANCIAL RESULTS TheresultsoftheGrouparepresentedintheconsolidatedstatementofprofitorlossandothercomprehensiveincome.Theprofitaftertaxationfortheyearended31December2018amountedto€15.722.000comparedto€19.873.000in2017. DIVIDENDS On4October2018,theBoardofDirectorsapprovedthepaymentofaninterimdividendof3centspershareof€2.158.078. Onthesamedate,theExtraordinaryGeneralMeetingapprovedthepaymentofadividendof6,5centspershareof€4.675.837outoftheprofitsofyear2016.

TheBoardofDirectorsrecommendsthepaymentofanadditionaldividendof€8.632.314or€0,12pershare.Thetotaldividendtobepaidincludingtheinterimdividendabovewillbe€10.790.392or€0,15pershare.Therespectivedividendspaidforthepreviousyearwere€17.264.628or€0,24pershare.

MAIN RISKS AND UNCERTAINTIES Statementsmadeinthisreportthatarenothistoricalfacts,includingtheexpectationsforfuturevolumeandpricingtrends,demandfortheproducts,energycostsandothermarketdevelopmentsareforwardlookingstatements.Thesestatementsarenotguaranteesoffutureperformanceandinvolverisks,uncertaintiesandassumptions("Factors"),whicharedifficulttopredict.


MANAGEMENT REPORT (continued)

SomeoftheFactorsthatcouldcauseactualresultstodiffermateriallyfromthoseexpressedintheforward-lookingstatementsinclude,butarenotlimitedto:thecyclicalnatureoftheCompany'sbusiness;nationalandregionaleconomicconditions;currencyfluctuations;energyprices;emissionrightspricefluctuation;seasonalnatureoftheCompany’soperations;levelsofconstructionspendingand,inparticular,inGovernmentinfrastructureprojectsannounced;supply/demandstructureoftheindustry;competitionfromneworexistingcompetitors;unfavourableweatherconditionsduringpeakconstructionperiods;changesinandimplementationofenvironmentalandothergovernmentalregulations.Ingeneral,theCompanyissubjecttotherisksanduncertaintiesoftheconstructionindustry.Theforward-lookingstatementsaremadeasofthisdateandtheCompanyundertakesnoobligationtoupdatethem,whetherasaresultofnewinformation,futureeventsorotherwise. Further information for risksanduncertainties towhich theGroup isexposed, isdisclosed innote36of thefinancialstatements. FUTURE DEVELOPMENTS Thecementindustryisfacingnewchallengeswithoversupplyofcementandhighcostofcarbonandemissionrightswhichhasincreasedfivetimesinaperiodoftwoyears.

PHOTOVOLTAIC PARK TheCompanyisproceedingwithanewinvestmentinrenewableenergy.Thisrelatestoaphotovoltaicparkwithacapacityof8MWthatisexpectedtobeinoperationthefirstquarterof2020,atacostof€6,7million.Theproducedenergywillcover8%to10%ofcurrentelectricityrequirementsandwillreducecarbondioxideemissions.

TheCompanyhasalsobeenworkinghardonreducingcarbonemissionsatitskilnbyreplacingtraditionalfossilfuelswithtreatedstreamsofwaste,currentlyachievingarateofreplacementof45%in2018. EVENTS AFTER THE REPORTING PERIOD Noimportanteventshaveoccuredafterthereportingperiod(seenote39ofthefinancialstatements). SHARE CAPITAL TheissuedsharecapitaloftheCompanycomprises71.935.947ordinarysharesof€0,43pershare.TherewerenochangestothesharecapitaloftheCompanyduring2018.TheCompany’ssharesarelistedontheCyprusStockExchange.

TherearenorestrictionsonthetransferoftheCompany’ssharesotherthantherequirementsoftheDirectiveonInsiderDealingandMarketManipulation,whichrelatestotransactionswithrelatedparties.

TheCompanydoesnothaveanysharesinissuewhichcarryspecialcontrolrights.



AGREEMENTS WHICH ARE EFFECTIVE UPON A CHANGE OF CONTROL OF THE COMPANY TheCompanyhasnotcontractedanyagreementwhichbecomeseffective,isamendedorceasestoapplyincaseofchangeofcontrol followingapublic tenderoffer to theCompany’sshareholdersor theproposalofaresolutiontothegeneralmeetingoftheCompanyforamerger,acquisitionorsaleofitsoperations.

TherearenoagreementswiththeExecutiveDirectorsoremployeesoftheCompanyprovidingforcompensationincaseofresignationordismissalwithoutavalidreasonorforterminationoftheiremploymentduetoapublictenderoffer for theacquisitionof thesharesof theCompany. Incaseof terminationby theCompanyof theemploymentofExecutiveDirectorsoremployees,priortotheirretirement,theCompanyhastocompensatethemaccordingtotheprovisionsoftheLawandtheCompany’sagreementswiththeTradeUnions. DIRECTORS’ INTEREST IN THE SHARE CAPITAL OF THE COMPANY ThebeneficialinterestintheCompany’ssharesheldbymembersoftheBoardofDirectors,directlyorindirectly,at31December2018and6April2019,issetoutinnote32oftheFinancialStatements. BRANCHESDuringtheyear,theGroupdidnotoperateanybranches. BOARD OF DIRECTORS Themembersof theBoardofDirectorsonthedateof thereportappearonpage10.InaccordancewiththeCompany’sArticlesofAssociation(Article92),atthenextAnnualGeneralMeeting,MessrsGeorgeSt.Galatariotis(Non-Executive Director), Charalambos Panayiotou (non-Executive Director) and Christophe Allouchery(Non-ExecutiveDirector)retirefromofficebyrotationand,beingeligible,offerthemselvesforre-election. TheDirectorswhoservedduringtheperiodfrom31May2018,thedateofthelastAnnualGeneralMeeting,tillthisdatewerethefollowing:

AntoniosA.Antoniou GeorgeSt.Galatariotis CostasSt.Galatariotis StavrosG.Galatariotis CostasKoutsos CharalambosPanayiotou MaurizioMansiMontenegro AntonisMikellides ChristopheAllouchery AntoniosKatsifos SteliosS.Anastasiades

The responsibilities of the Directors as members of the Board Committees are disclosed in the CorporateGovernanceReport. TherewerenomaterialchangestothecompensationoftheBoardofDirectors.



CORPORATE GOVERNANCE STATEMENT TheCompany recognises the importanceof implementing corporate governanceprinciples andadopted theCSE’s Corporate Governance Code and applies its principles. The CSE’s Corporate Governance Code isavailableontheCSEwebsite(www.cse.com.cy).

TheCompanyhasadoptedthe4thRevisedEditionoftheCorporateGovernanceCode,issuedbytheCyprusStockExchangeinApril2014.AtthedateofthisreporttheprinciplesoftheCorporateGovernanceCodearepartlyimplemented,giventhatthePrincipleregardingBoardBalanceandtheProvisionB.1.2oftheCorporateGovernanceCoderegardingtheindependencecriteriaofthemembersoftheRemunerationsCommitteewerenotfullymet.OnJanuary2019theCompanyadoptedthe5thRevisedEditionoftheCorporateGovernanceCodewhichisapplicablefortheCorporateGovernanceReportfortheyearending31/12/2019onwards. The Corporate Governance Report of the Company for 2018 is available on the website of the Company(www.vassiliko.com). TherulesgoverningthecompositionandfunctionoftheBoardofDirectorsandtheappointmentandreplacementofitsmembersaswellasthecompositionandfunctionoftheBoardCommitteesaresetoutinSectionBoftheReportonCorporateGovernance. AnyamendmentoradditiontotheArticlesofAssociationoftheCompanyisonlyvalidifapprovedbyaspecialresolutionatashareholders’meeting. TheBoardofDirectorsmayissuesharecapitalifthereissufficientsharecapitalwhichhasnotbeenissuedandaslongasthenewsharestobeissuedareofferedfirsttotheexistingshareholders,proratatotheirpercentageholding. In theevent that thenewshareswill notbeoffered toexistingshareholders,a resolutionapprovedwithaspecialmajorityofatleastthe80%oftheshareholders,whoareentitledtoattendandvoteinaGeneralMeeting,mustbepassed.Intheeventthatasharecapitalincreaserequiresanincreaseintheauthorisedsharecapital,theapprovaloftheshareholdersinaGeneralMeetingmustbeobtained.TheBoardofDirectorsmayalsoproposetotheGeneralMeetingofshareholdersasharebuybackscheme.

TherearenorestrictionsinvotingrightsandspecialcontrolrightsinrelationtothesharesoftheCompany.

SHAREHOLDERS HOLDING MORE THAN 5% Theshareholdersholdingdirectlyorindirectlymorethan5%oftheissuedsharecapitaloftheCompanyasat31December2018and6April2019,aresetoutinnote33ofthefinancialstatements. PREPARATION OF PERIODIC REPORTING TheGrouphasinplaceaneffectiveinternalauditsystem,theadequacyofwhichisevaluatedatleastannuallyby theBoardofDirectorsand theBoard’sAuditCommittee, in respectof financialandoperational systems.TheadequacyoftheInternalAuditSystemsecuresthevalidityoffinancialdataandcompliancewithrelevantlegislationandaimstosecurethemanagementofriskswhileprovidingreasonableassurancethatnolosswillincur.


CORPORATE GOVERNANCE REPORT

SECTION ATheCompanyhasadoptedthe4thRevisedEditionoftheCorporateGovernanceCode,issuedbytheCyprusStockExchangeinApril2014.AtthedateofthisreporttheprinciplesoftheCorporateGovernanceCodearepartlyimplemented,giventhatthePrincipleregardingBoardBalanceandtheProvisionB.1.2oftheCorporateGovernanceCoderegardingtheindependencecriteriaofthemembersoftheRemunerationsCommitteewerenotfullymet.OnJanuary2019theCompanyadoptedthe5thRevisedEditionoftheCorporateGovernanceCodewhichisapplicablefortheCorporateGovernanceReportfortheyearending31/12/2019onwards.

SECTION B

THE BOARD TheCompanyisheadedbytheBoardofDirectorswhichat31December2018comprisedoneExecutiveandtennon-ExecutiveDirectorsandisresponsibletotheshareholdersforthepropermanagementofthecompany«ΤσιμεντοποιίαΒασιλικούΔημόσιαΕταιρείαΛτδ»(Englishtranslation“VassilikoCementWorksPublicCompanyLtd”) and its subsidiaries.Thenon-ExecutiveDirectors comprised two independentDirectors andeight non-independent Directors. The members of the Board (excluding the Chairman) comprised two independentnon-ExecutiveDirectors and eight non-independentDirectors, all of which are non-ExecutiveDirectors.Theindependentnon-ExecutiveDirectorsoftheBoardwereMr.AntonisMikellidesandMr.SteliosS.Anastasiades. TheBoardofDirectorsoftheCompanyasatthedateofthisreportcomprisesthefollowingmembers:

AntoniosAntoniou –ExecutiveChairmanGeorgeSt.Galatariotis –Νon-ExecutiveDirectorCostasSt.Galatariotis –Νon-ExecutiveDirectorStavrosG.Galatariotis –Νon-ExecutiveDirectorCostasKoutsos –Νon-ExecutiveDirectorCharalambosPanayiotou –Νon-ExecutiveDirectorMaurizioMansiMontenegro –Νon-ExecutiveDirectorAntonisMikellides –Independentnon-ExecutiveDirectorChristopheAllouchery –Νon-ExecutiveDirectorAntoniosKatsifos –Νon-ExecutiveDirectorSteliosS.Anastasiades –Independentnon-ExecutiveDirector

TheCompany’ssharesaretradedintheAlternativeMarketoftheCyprusStockExchange.CorporategovernanceprovisionsregardingBoardBalanceforCompanieslistedintheAlternativeMarketprovidethatthemajorityofthenon-ExecutiveDirectors,orat least twoDirectors,have tobe independentnon-ExecutiveDirectors.TheCompanycomplieswiththeaboveBoardBalanceprovisionsincetwomembersoftheBoardareIndependentnon-ExecutiveDirectors.BasedontheprovisionsoftheCorporateGovernanceCode,andgiventhattheBoardof Directors is comprised of two Independent non-Executivemembers and nine non-Independentmembers(executiveandnon-executive),BoardBalanceisnotmetaccordingtoPrincipleA.2oftheCorporateGovernanceCode.


CORPORATE GOVERNANCE REPORT (continued)

Mr.SteliosS.Anastasiades, independentnon-ExecutiveDirector,wasappointedon30May2017asSeniorIndependentDirector.TheSeniorIndependentDirectoroftheCompanyisavailabletoshareholdersiftheyhaveconcerns thathavenotbeen resolved through thenormalchannelsofcontactwith theExecutiveChairman,or theGeneralManager /DeputyGeneralManagers or forwhich such contact is inappropriate.TheSeniorIndependentDirectorwillattendsufficientmeetingsofmajorshareholdersandfinancialanalyststodevelopabalancedunderstandingoftheissuesandconcernsofsuchshareholders.TheSeniorIndependentDirectorcanbecontactedinitiallyviatheCompanySecretaryattheRegisteredOfficeoftheCompany.

TheBoardhassixscheduledmeetingsayear,settingandmonitoringtheGroup’sstrategy,reviewingtradingperformance,ensuringadequatefunding,examiningmajorcapitalexpenditure,formulatingpolicyonkeyissuesand reporting to shareholderswhere appropriate.TheBoard ofDirectors convened 7 times during 2018. Inaccordancewithbestpractice,theBoardhasestablishedtheAuditCommittee,theRemunerationsCommitteeandtheNominationsCommitteeaspertherequirementsoftheCode.TheCompanySecretaryisresponsibletoandappointedbytheBoardandallDirectorshaveaccesstoheradviceandservices.Directorsmayobtainindependentprofessionaladviceifnecessary,attheCompany’sexpense.Formalagendas,papersandreportsaresuppliedtoDirectorsinatimelymanner,priortoBoardmeetings.Briefingsarealsoprovidedatothertimes,forexample,throughoperationalvisitsandbusinesspresentations.

CHAIRMAN, CHIEF EXECUTIVE OFFICER AND GENERAL MANAGER Thedivisionof responsibilitybetween theExecutiveChairmanand theGeneralManagerof theCompany ispresentedbelow.FollowingtheassignmentofthedutiesandresponsibilitiesoftheGeneralManageronthe1stofAugust2017totheExecutiveChairmanoftheCompany,inhisadditionalroleastheChiefExecutiveOfficeroftheCompany,thedutiesandresponsibilitiesoftheGeneralManagerliewiththeExecutiveChairman.

TheExecutiveChairmanhas,amongothers,thefollowingduties&responsibilities:

• DeterminestheAgendaofthemeetingoftheBoardofDirectors.• Chairs theMeetings of the Board of Directors and the General Meetings of the Shareholders of the

Company.• Reviews the information and documents and confirms their relevance in order to be submitted to the

MembersoftheBoardofDirectorspriortotheBoardMeetings.• ReviewsthestrategyoftheGroupwiththeGeneralManager/DeputyGeneralManagersoftheCompany.• RepresentstheCompanyinallitsmajordealings.• MeetswiththemajorshareholdersoftheCompanyandconveystheirsuggestionstotheBoardofDirectors.• Cooperateswith theGeneralManager /DeputyGeneralManagers of theCompany to determine the

strategictargetsoftheGroupaccordingtothedevelopmentsofthesectorwithinwhichtheGroupoperatesandsecuresthethoroughappraisaloftheCompany’sstrategicorotherdevelopmentproposalsandthepresentationthereoftotheBoardofDirectorsforfinalapproval.

• EvaluatesandpromotesvariousotherproposalsoftheGeneralManager/DeputyGeneralManagers.• RepresentstogetherwiththeGeneralManager/DeputyGeneralManagersand/orselectivemembersof

theManagementTeamtheCompanyatvariousmeetingsforthepromotionofthestrategictargetsoftheCompany.



• IdentifiestheCompany’smajorandotherstakeholdersandformulatesaclearpolicyoncommunicatingorrelatingwiththemthroughaneffectiveinvestorrelationsprogram.

• Develops and maintains effective relationships with the stakeholders involved in the Company’s life,ensuringthecontinuityanddevelopmentofthebusiness.

• Supervisestheinternalcontrolsystem,securestheproperimplementationoftheCompany’stargetsandupdatestheBoardofDirectorsontherelatedprogress.

• HoldsperiodicmeetingswiththemanagementoftheCompanytodiscussvariousspecificsubjects.

TheGeneralManagerand /or theChiefExecutiveOfficerof theCompany,amongothers,has the followingduties&responsibilities,whichcurrentlyliewiththeExecutiveChairman:

• To manage together with the Deputy General Managers the Company in line with the strategy andthecommercial targetsdeterminedby theBoardofDirectorsand incompliancewithall relevant laws,regulations,CorporateGovernancecodesaswellasinternalpoliciesandprocedures.

• ToensurewiththesupportandcollaborationoftheDeputyGeneralManagersthedailysmoothoperationoftheCompanyinlinewiththepolicy,thetargetsandthebudgetsapprovedbytheBoardofDirectors.

• Toensure timely andeffective implementationof the strategic resolutionsof theBoardofDirectors inagreementwiththeExecutiveChairman.

• In cooperation with the Executive Chairman tomanage the business development of the Company’sactivities,itssubsidiariesandassociates.

• ToinformregularlytheExecutiveChairmanregardingallthemajorissuesoftheCompany,includingthecurrentstatusoftheoperationsoftheCompany.

• Toimplementprocedurestoensureexistenceofanefficientinternalcontrolsystem.• Todefineandintroduceappropriaterules,measuresandprocedurestogovernoperationsatrisk.• Toidentifythemainbusinessrisksandapprovetherelevantactionplanstomitigatethem.

APPOINTMENTS TO THE BOARD TheNominationsCommitteeischairedbyMr.GeorgeSt.Galatariotis(non-ExecutiveDirector)andiscomposedof twootherDirectors,MessrsC.Koutsos (non-ExecutiveDirector)andA.Katsifos (non-ExecutiveDirector).AllthemembersoftheCommitteearenon-ExecutiveDirectors.TheNominationsCommitteeisresponsiblefortheselectionandnominationofanynewDirector,fortheBoard’sconsideration.TheCommitteeisresponsibletocarryoutaselectionprocess.UpontheappointmentofanewDirector,appropriate training isprovidedasrequired.InaccordancewiththeArticlesofAssociationoftheCompanyandtheCorporateGovernanceCode,threeoutoftheelevenDirectorsoftheCompany(excludingtheExecutiveChairmanandChiefExecutiveOfficeroftheCompany)retirebyrotationeveryyear(eachDirectorretireseverythreeyears)and,ifeligible,mayofferthemselvesforre-election.TheBoardhassetthe75thyearofageastheyearofretirement.



RELATIONS WITH SHAREHOLDERS Importance is attached tomaintaining a dialoguewith theCompany’s institutional shareholders.TheAnnualGeneralMeetingisusedasaforumforcommunicatingwithshareholders,providingbriefingsontheCompany’sperformance during the year under review and current business activity. There will be an opportunity forshareholderstomeetwithandputquestionstotheDirectors,includingthechairmenoftheAudit,Nominationsand Remunerations Committees.AtAnnual General Meetings, separate resolutions are proposed on eachsubstantiallyseparateissueandthenumberofproxyvotesreceivedforandagainsteachresolutionisannounced.Memberswithvotingrightsof5%mayplaceitemsontheagendaofAnnualGeneralMeetingsbysubmittingsuchitems,eitherinhardcopiesorsoftcopies(electronic),accompaniedwithrelevantexplanations,atleast42daysbeforethedateoftheAnnualGeneralMeeting.NoticesofAnnualGeneralMeetingsaresenttotheshareholdersat least21daysbeforethemeeting.TheBoardofDirectorsappointedMr.GeorgeSavvaasInvestorLiaisonOfficertofacilitatebettercommunicationwithshareholdersandinvestors.

FINANCIAL REPORTING Thepreparationandpresentationofthisreportandfinancialstatementsandotherpricesensitivepublicreports,seektoensurethatreportsarepreparedinawaythatrepresentsabalancedandunderstandableassessmentoftheGroup’spositionandprospects.

INTERNAL CONTROL Riskassessmentandreviewiscarriedoutbytheexecutivemanagementwithdetailsofsignificantrisksbeingdocumented. Periodic reports relating to significant risks and associated controls are prepared from thisdocumentationandpresentedtotheBoardforitsreview.TheBoardhasoverallresponsibilityfortheGroup’ssystemsofinternalcontrolandforreviewingtheireffectivenessonanannualbasis,aswellasoftheprocedureswhichconfirmtheaccuracy,completenessandvalidityoftheinformationthatisprovidedtotheinvestors.Thereviewcoversallsystemsofinternalcontrol,includingfinancialandoperationalsystems,aswellascompliancesystemsandsystemsforthemanagementofrisks,whichthreatentheattainmentoftheCompany’sobjectives.OnthebasisoftheprocessdescribedaboveduringtheyeartheInternalAuditorsprepareInternalAuditReportsaddressedtotheAuditCommitteewhichinformstheBoardthroughitsAnnualInternalAuditReport.AccordingtotheInternalAuditorsReports,thesystemsofinternalcontroldonotpresentanysignificantweaknesses.TheBoardhasreviewedthekeyrisksinherentintheGroup,togetherwiththeoperating,financialandcompliancecontrolsthathavebeenimplementedtomitigatethosekeyrisks.However,anysystemofinternalcontrolcanprovideonlyreasonableandnotabsoluteassuranceagainstmaterialmisstatementorloss.TheBoardhasputinplaceanorganisationstructurewithclearlydefinedlinesofaccountabilityanddelegatedauthority.Theprincipleshavebeendesignedtoestablishclearlocaloperatingautonomywithinaframeworkofcentralleadership,statedaimsandobjectives.Procedureswereestablishedforbusinessplanning,budgeting,capitalexpenditureapprovalandtreasurymanagement.TheExecutiveChairmanandtheGeneralManagerandDeputyGeneralManagersregularlyreviewtheoperatingperformanceofeachbusinessandmonitorprogressagainstbusinessplans.



AUDIT COMMITTEE AND AUDITORS TheAuditCommitteecomprisesofMessrsCostasSt.Galatariotis(ChairmanoftheCommittee-non-ExecutiveDirector),A.Mikellides (Independentnon-ExecutiveDirector)andMr.St.S.Anastasiades (Independentnon-Executive Director). The majority of the members of the Audit Committee are Independent non-ExecutiveDirectors.TheCommitteemetfourtimesduring2018.TheCommitteemeetingsprovideaforumforreportingbytheGroup’sexternalandinternalauditorswhohaveaccesstotheCommitteeforindependentdiscussion,withoutthepresenceoftheExecutiveDirectors.

TheAuditCommittee reviewsawide rangeof financialmatters including the annual andhalf-yearly results,statementsandaccompanyingreports,before theirsubmission to theBoardandmonitors thecontrolswhichare in force to ensure the integrity of the financial information reported to shareholders, and also overseestheprocedures for theselectionofaccountingpoliciesandaccountingestimates for theCompany’sfinancialstatementsandensuresthatamechanismisinplacetoensuretheCompany’sassets,includingthepreventionanddetectionof fraud.TheAuditCommitteealsoadvises theBoardon theappointmentofexternalauditorsandontheirremunerationbothforauditandnon-auditwork,aswellasproposestotheBoardofDirectorstheappointment and revocation of appointment of the audit firm assignedwith the InternalAudit functions, andensuresitsindependence.

TheGroup’sinternalauditfunctionisoutsourcedtoPricewaterhouseCoopersLtd,aprofessionalAuditorsFirm,whichmonitorstheGroup’sinternalfinancialcontrol,theinternalcontrolsystemsandriskmanagementsystemsandreportstothemanagementandtotheAuditCommittee.

TheAuditCommitteeconsiderstheabovementionedperiodicreportswhereastheManagementisresponsiblefor the implementation of the recommendations made by internal audit that carry out post-implementationreviews.Theexternalauditorscarryout independentandobjective reviewsand testsof the internalfinancialcontrolprocesses,onlytotheextentthattheyconsidernecessarytoformtheirjudgementwhenexpressingtheirauditopinionontheaccounts.

TheAuditCommitteediscussesextensivelywiththeauditorssignificantauditfindingsarisingduringtheirauditwork,whichwereresolvedorremainedunresolved,aswellastheauditor’sreportwhichreferstoweaknessesintheinternalcontrolsystem,inparticularthoseconcerningtheproceduresoffinancialreportingandthepreparationoffinancialstatements.

GOING CONCERN Aftermakingappropriateenquiries,theDirectorsconsiderthattheGrouphasadequateresourcestocontinueinoperationalexistencefortheforeseeablefuture.ForthisreasontheycontinuetoadoptthegoingconcernbasisinpreparingtheaccountsandstatethattheCompanyintendstooperateasagoingconcernforthenexttwelvemonths.



REMUNERATIONS COMMITTEE TheRemunerationsCommitteecomprisesofthreenon-ExecutiveDirectors.ThemembersoftheRemunerationsCommitteeareMessrsCh.Panayiotou(non-ExecutiveDirector),St.Galatariotis(non-ExecutiveDirector)andA.Mikellides(Independentnon-ExecutiveDirector).TheCommitteeischairedbyMr.Ch.Panayiotouwhohasknowledgeandexperienceinremunerationpolicy.EventhoughallthemembersoftheRemunerationsCommitteearenon-executiveDirectors,onlyonedirectoroutof the threemembersof theRemunerationsCommittee isindependentnon-executivedirectoraccordingtothecriteriaofindependencyofadirectorasthesearedefinedbytheprovisionA.2.3.oftheCorporateGovernanceCode.TheCommitteewillusuallymeetatleastonceayear.TheGroupExecutiveChairmanwillnormallybeinvitedtoattenditsmeetingsinordertomakerecommendationsregardingtheremunerationof theGeneralManager/DeputyGeneralManagers.TheCommitteeperiodicallyreviewstheDirectorsRemunerationundertheircapacityasnon-ExecutiveDirectorsandmembersoftheBoard’sCommittees,aswellastheremunerationpolicyfortheExecutiveDirectorsandtheGeneralManager/DeputyGeneralManagers.Independentexternallegalandconsultancyadviceisobtainedwhennecessary.TheGroupExecutiveChairmanisnotpresentwhenhisownremunerationisdiscussed.

TheRemunerationpolicyoftheDirectorsoftheCompanyisincludedintheRemunerationsReport(page23).

DIRECTORS SEEKING RE-ELECTION AlltheDirectorsaresubjecttoelectionbytheshareholdersatthefirstAnnualGeneralMeetingthatfollowstheirappointmentandthereafterretireeverythreeyears.AccordingtotheArticlesofAssociation,onethirdofthetenCompanyDirectors(excludingtheExecutiveChairman/ChiefExecutiveOfficeroftheCompany)retirefromtheBoardateachAnnualGeneralMeeting.TheDirectorsliabletoretirementaccordingtotheaboveprovisionsarethosewhoservedasmembersoftheBoardforthelongestperiodsincetheirlastelection.

InaccordancewiththeCompany’sArticlesofAssociation(Article92),atthenextshareholdersAnnualGeneralMeeting Messrs George St. Galatariotis (Non-Executive Director), Charalambos Panayiotou (non-ExecutiveDirector) and ChristopheAllouchery (Non-Executive Director), shall retire from office by rotation. All abovementionedDirectors,beingeligible,shallofferthemselvesforre-election.

LOANS AND GUARANTEES GRANTED TO DIRECTORSNoloansand/orguaranteesweregrantedtotheDirectorsoftheCompanyortoDirectorsofanysubsidiaryorrelatedcompany,eitherbytheCompanyitselforbyitssubsidiaryorrelatedcompanies,andtherearealsonomoniesreceivablefromanycompanyaDirectorand/oranypersonrelatedtohim,isinvolvedwith.

COMPLIANCE WITH THE CODE OF CORPORATE GOVERNANCE OFFICERTheBoard ofDirectors appointedMr.GeorgeSavva, FinancialManager of theCompany, at the position ofCompliancewiththeCodeofCorporateGovernanceOfficer.

BOARD OF DIRECTORS CONFIRMATIONTheBoardofDirectorsassuresthattothebestofitsknowledge,therehasbeennoviolationoftheSecuritiesandStockExchangeofCyprusLawandRegulations.


REMUNERATION REPORT

TheRemunerationReportoftheCompanyfortheyear2018hasbeenpreparedaccordingtoAppendices1and2oftheCorporateGovernanceCode.

REMUNERATIONS COMMITTEE TheRemunerationsCommitteeoftheBoardisresponsibleforensuringthattheremunerationpackagesawardedtoExecutiveDirectorsareappropriatetoindividuallevelsofresponsibilityandperformance,areconsistentwiththeCompany’sremunerationpolicy,andareinlinewiththeprinciplesoftheCorporateGovernanceCode.

REMUNERATION POLICY TheBoard’spolicy is toemployhighcalibrepeople for itskeypositions. It requiresacorresponding levelofperformancefromthosepeopleandseekstorewardaccordingly.TheGroupmaycommissionspecialreviewsfromtimetotimetoassesstheDirectors’compensationlevels.Accountistakenofthesalaryandtotalremunerationlevels prevailing in comparable jobs both inside and outside theConstruction andBuildingMaterials sector,togetherwiththeindividualperformanceandcontributionofeachExecutiveDirector.

Theremunerationof theExecutiveChairmanandtheGeneralManager includesvariable-paycomponentstoensurethattheexecutiveremunerationislinkedtotheCompany’sperformance.Amaximumlimitofthevariable-paycomponentisset.Thenon-variablecomponentissufficientremunerationwhenavariableremunerationisnotgranted.TheBoardconsidersthatpackagesofthisnatureareconsistentwithprevailingpracticeandarenecessarytoattract,retainandrewardexecutivesofthecalibretheGrouprequires.Inframingthepolicy,theBoardhasgivenfullconsiderationtotheprovisionsoftheCorporateGovernanceCode.Theannualincentiveplanrewardsfortheperformanceofthepreviousyearandispaidincash.ThemaximumbonuspaymentisexpressedasapercentageofbasesalaryandisbasedontheevaluationoftheperformanceoftheExecutiveChairmanandtheGeneralManagerconductedbytheRemunerationsCommitteeattheyearfollowingtheperformanceperiod.TheRemunerationsCommitteeevaluatestheperformanceoftheExecutiveChairmanandtheGeneralManagerconsideringtheCompany’sfinancialperformance,costscontainmentmeasures,measurestowardstheGroup’slong-termviability,aswellasnon-financialcriteriarelatingtodevelopmentandcreatinglongtermvaluefortheGroup.Bonusesgrantedin2018concernrewardsforthefinancialperformanceoftheCompanyfortheyear2017.TheCompanyreservestherightforfullorpartialrecoveryofanybonusesgrantedonthebasisofinformationwhichsubsequentlyprovestobeinaccurate.

Inadditiontothebasesalaryandincentiveplanparticipation,theExecutiveChairmanandtheGeneralManagerenjoythesamebenefitsasotheremployeesoftheCompany,whichincludeprovidentfundandmedicalfund.

NosignificantchangesweremadetotheremunerationpolicyoftheCompanyforyear2018comparedtothepreviousyear.

ThetotalremunerationsoftheExecutiveDirectorsundertheircapacityasExecutivesfortheyear2018were€404.571.

PENSION SCHEME AlltheEmployeesoftheCompanyincludingtheGeneralManagerandtheExecutiveChairmanaremembersoftheCompany’sProvidentFund,whichisadefinedcontributionscheme.NootheradditionalpensionschemesexistforanyoftheExecutiveMembersoftheBoard.


REMUNERATION REPORT (continued)

EMPLOYMENT CONTRACTS EmploymentofExecutiveDirectorsareforindefiniteperiods,howevernoticeperiodsdonotexceedoneyearas per the requirements of theCorporateGovernanceCode. In caseof termination by theCompanyof theemploymentofExecutiveDirectors,prior to their retirement, theCompanyhas tocompensate theExecutiveDirectorsaccordingtotheprovisionsoftheLaw.

NON-EXECUTIVE DIRECTORS TheremunerationoftheDirectors,bothExecutivesandnon-Executives,forservicesrenderedtotheCompanyasDirectors,isdeterminedbytheannualgeneralmeetingoftheCompanyontheproposaloftheBoard.Thenon-ExecutiveDirectorshavelettersofappointmentforathree-yearterm.Theydonotparticipateinanyprofitsharing,shareoptionorother incentivescheme.The remunerations foreachof theDirectors for2018were€20.000,and€25.000fortheChairmanand€300permeetingforattendanceinperson.

The remunerationsof theDirectors,Executivesandnon-Executives,under their capacityasDirectorsof theCompanyandasmembersoftheBoardofDirectors’CommitteesaswellasundertheircapacityasExecutiveDirectorsfor2018wereasfollows:

Directors

Fees as Members of the Board

and its Committees

Fees and emoluments

as executives Bonuses

Other Benefits

Social Benefits

Provident Fund

Total Remuneration

€ € € € € €

Executive DirectorsAntoniosAntoniou 28.300 276.000 100.000 4.800 4.243 19.528 432.871

Non-Executive Directors GeorgeSt.Galatariotis 23.600 - - - - - 23.600

CostasSt.Galatariotis 23.900 - - - - - 23.900

StavrosG.Galatariotis 23.300 - - - - - 23.300

CostasKoutsos 23.600 - - - - - 23.600

CharalambosPanayiotou 23.600 - - - - - 23.600MaurizioMansiMontenegro 21.500 - - - - - 21.500AntonisMikellides 23.900 - - - - - 23.900

ChristopheAllouchery 20.900 - - - - - 20.900

AntoniosKatsifos 22.100 - - - - - 22.100

SteliosS.Anastasiades 23.000 - - - - - 23.000

257.700 276.000 100.000 4.800 4.243 19.528 662.271

LOANS AND GUARANTEES GRANTED TO DIRECTORSNo loansand/orguaranteesweregranted to theDirectorsof theCompanyor toDirectorsofanysubsidiarycompanyortotheirrelatedpartiesbytheCompanyanditssubsidiarycompanies.


DIRECTORS’ CURRICULA VITAE

ANTONIOS ANTONIOU – EXECUTIVE CHAIRMANMr.AntoniosAntoniouwasborn inLondon.Hestudiedat theUniversityofLondonwhereheobtainedaBSc(Hons)degreeandapostgraduatediploma.

Mr.Α.Antoniouworkedfor5yearsasaBiochemistatUniversityCollegeLondonandfor3yearsasaComputerSystemsAnalystatBritishGasHeadquartersinLondon.HewasafoundingpartnerofAMERWorldResearchLtdandDeputyGeneralManagerfrom1983until1998.From1998untilDecember2006heservedasSeniorVicePresident (OperationsandSystems)ofNielsenEuropeandwasamemberof theEuropeanExecutiveCommittee.

AsfromFebruary2008hehasbeentheExecutiveChairmanofVassilikoCementWorksPublicCompanyLtd,andsinceAugust2017hastakenontheadditionalroleoftheChiefExecutiveOfficeroftheCompany.

HeisaMemberoftheBoardofDirectorsoftheCyprusEmployers&IndustrialistsFederationandViceChairmanofitsExecutiveCommittee.

GEORGE ST. GALATARIOTISMr.GeorgeSt.GalatariotiswasborninLimassolin1947.HestudiedBusinessAdministrationatCityPolytechnicinLondon.

Mr.GeorgeGalatariotisisExecutiveChairmanofGalatariotisGroupofCompanies,ExecutiveChairmanofTheCyprusCementPublicCompanyLtdandK&GComplexPublicCompanyLtd.HeisalsoMemberoftheBoardofDirectorsofseveralprivateandpubliccompanies.HeisaTrusteeoftheCyprusConservationFoundation(TerraCypria).Mr.GeorgeGalatariotishasalsoservedasamemberoftheBoardofLimassolChamberofCommerceandIndustryandtheCyprusPortsAuthority.Asfrom2017Mr.GalatariotisisamemberoftheBoardofDirectorsoftheCyprusEmployers&IndustrialistsFederation.

COSTAS ST. GALATARIOTISMr.CostasSt.GalatariotiswasborninLimassolin1963.Hegraduatedthe5thGymnasiumofLimassolandhestudiedEconomics,IndustryandCommerceattheLondonSchoolofEconomicsandPoliticalScience.

Mr.CostasGalatariotisisExecutiveChairmanoftheGalatariotisGroupofCompanies,ExecutiveChairmanofC.C.C.TouristEnterprisesPublicCompanyLtdandmemberofBoardsofDirectorsofseveralprivateandpubliccompanies.HeisamemberoftheboardofdirectorsoftheAssociationofCyprusTouristEnterprises(ACTE).Mr.CostasSt.GalatariotisisChairmanoftheAuditCommitteeofVassilikoCementWorksPublicCompanyLimitedsince2008.

Mr.CostasSt.GalatariotishasservedasHonoraryConsulGeneralofJapaninCyprusfrom2007until2012.SinceSeptember2014heisthePresidentoftheBoardoftheLimassolChamberofCommerceandIndustryandasfromJuly2018heistheViceChairmanoftheCyprusInvestmentPromotionAgency(CIPA).


DIRECTORS’ CURRICULA VITAE (continued)

STAVROS G. GALATARIOTISMr. StavrosGalatariotiswasborn in Limassol in 1976. In 1999hegraduated from theUniversity ofSurreywithaBSc inBusinessEconomics(FirstClass).Duringhisstudieshewasawarded theCIMAawardby theCharteredInstituteofManagementAccountants.StavrosholdsanMBAfromtheCyprusInternationalInstituteofManagement.

Since2000,StavrosGalatariotisisanExecutiveDirectoroftheGalatariotisGroupofCompaniesandamemberoftheBoardofDirectorsofseveralprivateandpubliccompanies.HeisaDirectorofVassilikoCementWorksPublicCompanyLtdsince2008.

COSTAS KOUTSOSMr.CostasKoutsosistheExecutiveChairmanofKEOPlcandMemberof theBoardofDirectorsofHellenicMiningPublicCompanyLtd.Between1978and2011hewastheManagingDirectorofBMSMetalPipesIndustriesGroup.HeisaFinancialConsultant,CompaniesTaxConsultant,SecretaryandMemberoftheBoardofDirectorsofotherprivate companies.Mr.C.Koutsos isaqualifiedaccountantandhehasworked for twelveyears inaseniorposition inan internationalauditfirm.Hehasaperennialexperience in theCyprusStockExchangeMarket.Heisanactivememberofvariouscharitablefoundations.HeservedasMemberoftheBoardofDirectorsofCyprusMetalIndustryAssociation,memberoftheCyprusEmployersandIndustrialistsFederationfrom1985to2011.

CHARALAMBOS P. PANAYIOTOUMr.CharalambosPanayiotouwasbornonthe6thofJuly1971.HestudiedManagementSciences(BSc)attheLondonSchoolofEconomicsandPoliticalScience(1993).HejoinedCoopers&LybrandasaCharteredAccountanttraineeintheauditandtaxdepartmentfrom1993to1996.Heisamemberof“TheInstituteofCharteredAccountants inEnglandandWales”aswellasaMemberof “The InstituteofCertifiedPublicAccountantsofCyprus”since1996.HethenjoinedtheCyprusPopularBankLtd.In2000hewasappointedFinancialControlleroftheHolyBishopricofPaphos,ExecutivememberoftheBoardofDirectorsofSt.GeorgeHotel(Management)LtdaswellasofSMTsadaGolfLtduntilSeptember2010,uponwhichdatehewasappointedasManagingDirectoroftheKEOPLCGroup.HeisaMemberoftheBoardofDirectorsofHellenicMiningGroupCompanies.HeservedasaMemberof theBoardof theHellenicBankPublicCompanyLtd fromJune2005 toJanuary2014.DuringthissameperiodheservedasChairmanoftheHellenicBank(Investments)Ltd.Asfrom2017Mr.PanayiotouisamemberoftheBoardofDirectorsoftheCyprusEmployers&IndustrialistsFederation.



MAURIZIO MANSI MONTENEGROMr.MaurizioMansiMontenegrowasbornonMarch10,1962.HeholdsadegreeinStatisticalSciencefromRomeUniversity“LaSapienza”,andapost-graduatedegreeinStrategicandInternationalMarketingfromSDABocconi(Milan),afterhavingattendedtheInternationalExecutiveProgrammeat“InstitutEuropéend’AdministrationdesAffaires”(INSEAD).

He started his career inHewlett-Packard as aBusinessAnalyst, thenas aStrategicPlanningSpecialist inAugusta–Westland.

In1990,hejoinedItalcementiGroupasaMarketingAnalystCoordinatorand,aftersevenyearsofexperienceintheGroup’sStrategicPlanDirection,hehasbeenresponsibleforCementCommercialactivitiesinEgypt.In2007hewasappointedasAssistanttotheC.E.O.ofItalcementiS.p.A.,andbetween2009and2016hewastheManagingDirectorofInterbulkTradingS.A.

Sincethe1stofJanuary2017,heistheDeputyC.E.O.ofHCTradingBV,thetradingcompanyofHeidelbergCementGroup.He isalsoamemberof theBoardofDirectorsof IntercomS.r.l., IntercomLibyaF.Z.C,HilalCementCo.,andAlMahaliyaReadyMixConcreteCo.

ANTONIS MIKELLIDESMr.AntonisMikellideswasborninLondonin1978.HestudiedattheUniversityofWestminsterwhereheobtainedaBAdegree inBusinessComputingandholdsaPostgraduatedegree inShipping,TradeandFinance fromCityUniversityLondonaswellasadiplomainTerrorismStudies, focusingmainlyonMarinePiracy, fromtheUniversityofSt.AndrewsinScotland.

Mr.Α.MikellidesjoinedZelaShippingCoLtdinLondonin2002asafleetoperator,andin2006wasinchargeof restructuring the fleet’smanagement company inPiraeusGreece.As from2010he has beenaDirector,ChiefFinancialOfficerandVice-PresidentofOlympiaOceanCarriersLtdandin2012alsobecameaDirectorofSeaTradeHoldings.Mr.AntonisMikellideshasbeenelectedontheBoardofDirectorsoftheCyprusUnionofShipownerssince2009.



CHRISTOPHE ALLOUCHERY Mr.ChristopheAlloucherywasborninFrancein1971.ChristophegraduatedinEconomicsfromParisIIUniversity,andholdstwoMaster’sdegreesinFinanceawardedin1996fromParisSchoolofBusiness.

Hestartedhis career inGrantThorton in1997asfinancialauditorand in2000he joinedCimentsCalcia inGuerville(France),memberofItalcementiGroup,asHeadofAnalyticalAccountingandthenHeadofCementControlling.In2010hemovedtoItalcementiGroupHeadquartersinBergamo(Italy)andwaspromotedSeniorZoneController–AssistanttotheZoneManager,responsibleforEgypt,Greece,Bulgaria,Kuwait,SaudiArabia,KazakhstanandTurkey.HeistheFinanceDirectoroftheBulgarianandAlbanianactivitiesofHeidelbergCementsince October 2016 and Chief Financial Officer and Board member of Halyps Building Materials inAthens(Greece)since2013.HeisalsomemberoftheboardofDevnyaCement,VulkanCementandLyulyakaMaterials,alllocatedinBulgaria.

ANTONIOS KATSIFOSMr.AntoniosKatsifoswasborn inAthens in1955.Hestudiedat theNationalTechnicalUniversityofAthenswhereheobtainedaDegreeasMiningandMetallurgyEngineerandhesuccessfullycompletedtheAcceleratedDevelopmentprogramatLondonBusinessSchool.

Heworkedfor10years,from1981until1991,asaMiningEngineerinundergroundoperationsatGreekBauxiteofElikonS.A.atDistomonViotiasandatMETVAS.A.atMolaoi Lakonias,Greece.Heworked forHALYPScement,memberof Intalcementigroupof companies inGreeceandnowHeidelbergCement, formore than25years.In1991,hejoinedETBETON,areadymixconcreteproductioncompanyasProductionManagerinAthens,andin1995hebecameVicePresidentandManagingDirectoratDOMIKIBETONatHeraclionCreta,apositionhelduntil2001.

In1999hebecameGeneralDirectorofHALYPSQUARRYinAtticaandin2001SalesandMarketingDirectorofHALYPSCEMENT.HeservedasSalesandMarketingDirectorinCementandAggregatesactivityatHALYPSBUILDINGMATERIALS S.A. until 2017 having served simultaneously the position of Sales Director for theconcreteactivityfrom2013to2015.HewasamemberoftheBoardofDirectorsoftheHellenicCementIndustryAssociationfrom2002until2017andamemberoftheBoardofDirectorsoftheMiningandQuarryAssociationinGreece,as representativeofHALYPS, from2014until2017.PresentlyMr.Katsifos isactively involvedasPartnerintheConsultancyfirmECHMESLtd,whichprovidesintegratedsolutionsinthefieldofEnvironmentalManagementandPermitting,ofMining,Metallurgical,LandPlanning,TouristandIndustrialprojectswithintheframeworkofsustainabledevelopment.



STELIOS S. ANASTASIADESMr.SteliosS.AnastasiadesisaMechanicalEngineer,aged65.HewasawardedaFirstClassHonoursB.Sc.(Eng)degreefromtheQueenMaryCollegeandaM.Sc.degreeandD.I.CfromtheImperialCollege,UniversityofLondon.

Mr.AnastasiadesistheManagingDirectorofKONEElevatorsCyprusLtd,theleadingcompanyinCyprusinthefieldofliftsandescalators,with120employeesandanannualturnoverof€15,7million.

HeisthePresidentoftheNicosiaChamberofCommerceandIndustry,amemberoftheexecutivecommitteeoftheCyprusChamberofCommerceandIndustry,amemberoftheCyprusTechnicalChamberandPresidentoftheBoardofDirectorsoftheFinancialOmbudsmanoftheRepublicofCyprus.InthepastheservedasViceChairmanofEurocypriaAirlines,memberoftheBoardofSocialInsurance,memberoftheBoardoftheLoanCommissionersandmemberoftheboardoftheCyprusOrganizationforStandardsandQualityControl.

30

INDEPENDENT AUDITORS’ REPORT

Reportontheauditoftheconsolidatedandseparatefinancialstatements

TothemembersofVassilikoCementWorksPublicCompanyLimited

OPINION WehaveauditedtheaccompanyingconsolidatedfinancialstatementsofVassilikoCementWorksPublicCompanyLimited(the''Company'')anditssubsidiaries(the''Group''),whicharepresentedonpages36to86andcomprisetheconsolidatedstatementoffinancialpositionasat31December2018,andtheconsolidatedstatementsofprofitorlossandothercomprehensiveincome,changesinequityandcashflowsfortheyearthenended,andnotestotheconsolidatedfinancialstatements,includingasummaryofsignificantaccountingpolicies.

Inouropinion,theaccompanyingconsolidatedandseparatefinancialstatementsgiveatrueandfairviewoftheconsolidatedfinancialpositionoftheGroupandtheCompanyasat31December2018,andofitsconsolidatedfinancialperformanceanditsconsolidatedcashflowsfortheyearthenendedinaccordancewithInternationalFinancialReportingStandards as adopted by theEuropeanUnion (“IFRS-EU”) and the requirements of theCyprusCompaniesLaw,Cap.113,asamendedfromtimetotime(the“CompaniesLaw,Cap.113”).

BASIS FOR OPINION Weconductedouraudit inaccordancewith InternationalStandardsonAuditing (“ISAs”).Our responsibilitiesunder thosestandardsare furtherdescribed in the“Auditors’ responsibilities for theauditof theconsolidatedandseparatefinancialstatements”sectionofourreport.WeremainedindependentoftheGroupthroughouttheperiodofourappointmentinaccordancewiththeCodeofEthicsforProfessionalAccountantsoftheInternationalEthics Standards Board for Accountants (“IESBA Code”), and the ethical requirements in Cyprus that arerelevanttoourauditoftheconsolidatedandseparatefinancialstatements,andwehavefulfilledourotherethicalresponsibilitiesinaccordancewiththeserequirementsandtheIESBACode.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforouropinion.

31

INDEPENDENT AUDITORS’ REPORT (continued)TothemembersofVassilikoCementWorksPublicCompanyLimited

KEY AUDIT MATTERSKeyauditmattersarethosemattersthat,inourprofessionaljudgementwereofmostsignificanceinourauditoftheconsolidatedandseparatefinancialstatementsofthecurrentperiod.Thesematterswereaddressedinthecontextofourauditoftheconsolidatedandseparatefinancialstatements,asawhole,andinformingouropinionthereonandwedonotprovideaseparateopiniononthesematters.

Revenuerecognition

PleaserefertoNote6ofthefinancialstatements.

The key audit matter How the matter was addressed in our audit

ThevastmajorityoftheGroup’srevenue,isgeneratedfromthesalesofClinkerandCement.

The Group generally recognizes revenue whenproducts are delivered to the customers for thedomesticsales,or inaccordancewith the termsandconditions of sale for export sales. Accordingly theterms and conditions by customers vary and mayaffectthetimingofrecognitionofrevenue.

Giventhesignificanceofrevenueasamajorcomponentinthestatementofcomprehensiveincome,andsincerevenue is oneof the keyperformance indicatorsoftheGroupand is, therefore,subject tomanipulation,weconsideredtherevenuerecognitionasakeyareaoffocusduringouraudit.

Ourauditproceduresconsistofthefollowing:• Evaluation and assessment of the operating

effectivenessoftheinternalcontrolsrelevanttotherecognitionandmeasurementofrevenue.

• Performing substantive analytical procedures,developinganexpectationofthelevelofrevenuebased on historical data and macroeconomicfactors.

• Evaluationoftheappropriatenessofrecognitionofboth revenueanddiscountsby reference tothe relevant invoices and/or agreements withcustomers,inordertoassesswhetherrevenueand discounts have been recognized in thecorrectaccountingperiod.

Valuationofinvestmentproperties

PleaserefertoNote15ofthefinancialstatements.

The key audit matter How the matter was addressed in our audit

At31December2018,themanagementhasassessedthe fair value of its investment properties at Euro8.284.678.

Giventhesignificanceof theaboveamountsaswellas the inherent subjectivity included in determiningthefairvalue,aswellas,thejudgmentinvolvedinthisarea, the valuation of investment property has beenidentifiedasanareaoffocusduringouraudit.

Ourauditproceduresconsistofthefollowing:• Assessment of the capability, competenceand

independenceoftheexternalvaluator.• Assessment of the methodology used by the

externalvaluator.• Assessment of the reasonableness of the

comparabledatausedinthevaluations.• Assessmentoftheaccuracyofthemathematical

calculations.

32

OtherinformationTheBoardofDirectorsisresponsiblefortheotherinformation.Theotherinformationcomprisesthemanagementreport,thecorporategovernancereport,theRemunerationreportandtheDirectorsCurriculaVitaebutdoesnotincludetheconsolidatedandseparatefinancialstatementsandourauditors’reportthereon.

Ouropinionontheconsolidatedandseparatefinancialstatementsdoesnotcovertheotherinformationandwedonotexpressanyformofassuranceconclusionthereon,exceptasrequiredbytheCompaniesLaw,Cap.113.

Inconnectionwithourauditoftheconsolidatedandseparatefinancialstatements,ourresponsibilityistoreadtheotherinformationand,indoingso,considerwhethertheotherinformationismateriallyinconsistentwiththeconsolidatedandseparatefinancialstatementsorourknowledgeobtainedintheauditorotherwiseappearstobemateriallymisstated.If,basedontheworkwehaveperformed,weconcludethatthereisamaterialmisstatementofthisotherinformation,wearerequiredtoreportthatfact.

WithregardstotheremunerationreportandtheDirectors’CurriculaVitaewehavenothingtoreport.

Withregardstothemanagementreportandthecorporategovernancereport,ourreportinthisregardispresentedinthe''Reportonotherlegalandregulatoryrequirements''section.

ResponsibilitiesoftheBoardofDirectorsandthosechargedwithgovernancefortheconsolidatedandseparatefinancialstatementsTheBoardofDirectorsisresponsibleforthepreparationofconsolidatedandseparatefinancialstatementsthatgiveatrueandfairviewinaccordancewithIFRS-EUandtherequirementsoftheCompaniesLaw,Cap.113,and forsuch internalcontrolas theBoardofDirectorsdetermines isnecessary toenable thepreparationofconsolidatedandseparatefinancialstatementsthatarefreefrommaterialmisstatement,whetherduetofraudorerror.

In preparing the consolidated and separate financial statements, the Board of Directors is responsible forassessingtheGroup’sabilitytocontinueasagoingconcern,disclosing,asapplicable,mattersrelatedtogoingconcernandusingthegoingconcernbasisofaccounting,unlessthereisanintentiontoeitherliquidatetheGrouportoceaseoperations,orthereisnorealisticalternativebuttodoso.

TheBoardofDirectorsandthosechargedwithgovernanceareresponsibleforoverseeingtheGroup’sfinancialreportingprocess.


33

Auditors’responsibilitiesfortheauditoftheconsolidatedandseparatedfinancialstatementsOur objectives are to obtain reasonable assurance about whether the consolidated and separate financialstatements as awhole are free frommaterialmisstatement,whether due to fraud or error, and to issue anauditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not aguaranteethatanauditconductedinaccordancewithISAswillalwaysdetectamaterialmisstatementwhenitexists.Misstatementscanarisefromfraudorerrorandareconsideredmaterialif,individuallyorintheaggregate,theycouldreasonablybeexpected to influence theeconomicdecisionsofusers takenon thebasisof theseconsolidatedandseparatefinancialstatements.

As part of an audit in accordance with ISAs, we exercise professional judgment andmaintain professionalskepticismthroughouttheaudit.Wealso:

• Identifyandassesstherisksofmaterialmisstatementoftheconsolidatedandseparatefinancialstatements,whetherduetofraudorerror,designandperformauditproceduresresponsivetothoserisks,andobtainauditevidencethatissufficientandappropriatetoprovideabasisforouropinion.Theriskofnotdetectingamaterialmisstatement resulting from fraud is higher than for one resulting fromerror, as fraudmayinvolvecollusion,forgery,intentionalomissions,misrepresentations,ortheoverrideofinternalcontrol.

• Obtainanunderstandingofinternalcontrolrelevanttotheauditinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheGroup’sinternalcontrol.

• EvaluatetheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesandrelateddisclosuresmadebytheBoardofDirectors.

• ConcludeontheappropriatenessoftheBoardofDirectors’useofthegoingconcernbasisofaccountingand, basedon theaudit evidenceobtained,whetheramaterial uncertaintyexists related toeventsorconditions thatmaycastsignificantdoubton theGroup’sability tocontinueasagoingconcern. Ifweconclude thatamaterialuncertaintyexists,weare required todrawattention inourauditors’ report totherelateddisclosuresintheconsolidatedandseparatefinancialstatementsor,ifsuchdisclosuresareinadequate,tomodifyouropinion.Ourconclusionsarebasedontheauditevidenceobtaineduptothedateofourauditors’report.However,futureeventsorconditionsmaycausetheGrouptoceasetocontinueasagoingconcern.

• Evaluate the overall presentation, structure and content of the consolidated and separate financialstatements, including thedisclosures,andwhether theconsolidatedandseparatefinancialstatementsrepresenttheunderlyingtransactionsandeventsinamannerthatachievestrueandfairview.

• ObtainsufficientappropriateauditevidenceregardingthefinancialinformationoftheentitiesorbusinessactivitiesoftheGrouptoexpressanopinionontheconsolidatedandseparatefinancialstatements.Weare responsible for the direction, supervision and performance of the Group audit.We remain solelyresponsibleforourauditopinion.


34

Wecommunicatewiththosechargedwithgovernanceregarding,amongothermatters,theplannedscopeandtimingoftheauditandsignificantauditfindings,includinganysignificantdeficienciesininternalcontrolthatweidentifyduringouraudit.

Wealsoprovidethosechargedwithgovernancewithastatementthatwehavecompliedwithrelevantethicalrequirementsregardingindependence,andtocommunicatewiththemallrelationshipsandothermattersthatmayreasonablybethoughttobearonourindependence,andwhereapplicable,relatedsafeguards.

Fromthematterscommunicatedwiththosechargedwithgovernance,wedeterminethosemattersthatwereofmostsignificanceintheauditoftheconsolidatedandseparatefinancialstatementsofthecurrentperiodandarethereforethekeyauditmatters.Wedescribethesemattersinourauditors’report.

Reportonotherlegalandregulatoryrequirements

Other regulatory requirementsPursuant to the requirementsofArticle10(2)ofEuropeanUnion (“EU”)Regulation537/2014weprovide thefollowinginformationinourIndependentAuditor’sReport,whichisrequiredinadditiontotherequirementsofISAs.

Date of appointment and period of engagementWewerefirstappointedauditorsoftheCompanybytheGeneralMeetingoftheCompany’smembersin1988.Ourappointmenthasbeenrenewedannuallybyshareholderresolution.Ourtotaluninterruptedperiodofengagementis32yearscoveringtheperiodsending31December1987to31December2018.

Consistency of auditors’ report with the additional report to the Audit Committee WeconfirmthatourauditopinionisconsistentwiththeadditionalreportpresentedtotheAuditCommitteedated11April2019.

Provision of non-audit services (“NAS”)Wehavenot providedanyprohibitedNAS referred to inArticle 5ofEURegulation537/2014asappliedbySection72oftheAuditorsLawof2017,L.53(I)2017,asamendedfromtimetotime(''LawL.53(I)/2017'').



CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME fortheyearended31December2018

The notes on pages 44 to 86 form an integral part of these financial statements

Note 2018 2017 Continuing operations €000 €000

Revenue 6 97.926 102.467Costofsales (70.944) (71.576)Gross profit 26.982 30.891

Otheroperatingincome 7 977 1.071Distributionexpenses (4.169) (4.510)Administrativeexpenses (3.803) (3.528)Otheroperatingexpenses (1.606) (1.678)Operating profit before financing costs 8 18.381 22.246

Financeincome 198 -Financeexpenses (114) (439)Net finance income/(cost) 10 84 (439)

Net(loss)/profitfrominvestingactivities 11 (703) 948 Shareofprofitfromequity-accountedinvestees 19 830 500 Profit before tax 18.592 23.255

Taxation 12 (2.870) (3.382)Profit for the year 15.722 19.873

Other comprehensive income

Items that will not be reclassified to profit or lossRevaluationofproperty,plantandequipment 14 (1.509) (290)

Items that are or may be reclassified to profit or lossCashflowhedges–effectiveportionofchangesinfairvalue (254) 812 Deferredtaxonrevaluationofproperties 12 (1.246) 389 Other comprehensive (loss)/income for the year (3.009) 911

Total comprehensive income for the year 12.713 20.784

Profit attributable to:Equityholdersoftheparent 15.722 19.873Non-controllinginterest - -

15.722 19.873

Total comprehensive income attributable to:Equityholdersoftheparent 12.713 20.784Non-controllinginterest - -

12.713 20.784

Basicanddilutedearningspershare(cents) 13 21,9 27,6


fortheyearended31December2018

COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME


Note 2018 2017 Continuing operations €000 €000

Revenue 6 97.926 102.467Costofsales (70.944) (71.576)Gross profit 26.982 30.891

Otheroperatingincome 7 977 1.071Distributionexpenses (4.169) (4.510)Administrativeexpenses (3.799) (3.524)Otheroperatingexpenses (1.606) (1.678)Operating profit before financing costs 8 18.385 22.250

Financeincome 198 -Financeexpenses (114) (439)Net finance income/(cost) 10 84 (439)

Net(loss)/profitfrominvestingactivities 11 (333) 1.196Profit before tax 18.136 23.007

Taxation 12 (2.776) (3.384)

Profit for the year 15.360 19.623

Other comprehensive income

Items that will not be reclassified to profit or lossRevaluationofproperty,plantandequipment 14 (1.509) (290)

Items that are or may be reclassified to profit or lossCashflowhedges–effectiveportionofchangesinfairvalue (254) 812 Deferredtaxonrevaluationofproperties 12 (1.246) 389 Other comprehensive (loss)/income for the year (3.009) 911

Total comprehensive income for the year 12.351 20.534

Basicanddilutedearningspershare(cents) 13 21,4 27,3


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CONSOLIDATED STATEMENT OF CASH FLOWSfortheyearended31December2018


Note 2018 2017 €000 €000

Cash flows from operating activities

Profitfortheyear 15.722 19.873Adjustmentsfor:Depreciationandamortisationcharges 14,16 14.555 13.788Loss/(profit)fromdisposalofinvestmentproperty 1.749 (104)Changeinfairvalueonfinancialassetsthroughothercomprehensiveincome 11 14 (56)Changeinfairvalueofinvestmentproperty 15 (986) (711)Interestincome 10 (198) -Dividendincome 11 (5) (3)Interestexpense 10 542 569 Shareofprofitofequity-accountedinvestees 19 (830) (500)Lossondisposalofproperty,plantandequipment 30 4 Incometaxexpense 12 2.870 3.382

Operating profit before changes in working capital and provisions 33.463 36.242Changes in:Tradeandotherreceivables 38 880 Inventories (1.249) (5.886)Tradeandotherpayables (236) 1.445Provisions - (100)

Cash generated from operating activities 32.016 32.581Interestpaid (579) (605)Taxpaid (1.011) (1.363)Net cash inflow from operating activities 30.426 30.613

Cash flows to investing activitiesProceedsfromdisposalofproperty,plantandequipment 178 22 Proceedsfromdisposalofinvestmentproperty 1.490 560 Interestreceived 198 -Dividendsreceived 310 128 Acquisitionofproperty,plantandequipment 14 (5.897) (13.893)Acquisitionofintangibles 16 - (59)Acquisitionofequity-accountedinvestee 19 (169) -

Net cash used in investing activities (3.890) (13.242)

Cash flows to financing activitiesRepaymentofloans (7.907) (7.907)Dividendspaid (18.343) (15.826)

Net cash used in financing activities (26.250) (23.733)

Net increase/(decrease) in cash and cash equivalents 286 (6.362)Cashandcashequivalentsat1January (27) 6.335Cash and cash equivalents at 31 December 24 259 (27)


COMPANY STATEMENT OF CASH FLOWSfortheyearended31December2018


Note 2018 2017 €000 €000

Cash flows from operating activities

Profitfortheyear 15.360 19.623Adjustmentsfor:Depreciationandamortisationcharges 14,16 14.555 13.788Loss/(profit)fromdisposalofinvestmentproperty 1.749 (104)Changeinfairvalueonfinancialassetsthroughothercomprehensiveincome 11 14 (56)Changeinfairvalueofinvestmentproperty 15 (1.051) (665)Interestincome 10 (198) -Dividendincome 11 (310) (297)Interestexpense 10 542 569 Lossondisposalofproperty,plantandequipment 30 4 Incometaxexpense 12 2.776 3.384

Operating profit before changes in working capital and provisions 33.467 36.246Changes in:Tradeandotherreceivables 34 873 Inventories (1.249) (5.886)Tradeandotherpayables (236) 1.448Provisions - (100)

Cash generated from operations 32.016 32.581Interestpaid (579) (605)Taxpaid (1.011) (1.363)Net cash inflow from operating activities 30.426 30.613

Cash flows to investing activitiesProceedsfromdisposalofproperty,plantandequipment 178 22 Proceedsfromdisposalofinvestmentproperty 1.490 560 Interestreceived 198 -Dividendsreceived 310 128 Acquisitionofproperty,plantandequipment 14 (5.897) (13.893)Acquisitionofintangibles 16 - (59)Acquisitionofsharesinassociatecompany 19 (169) -

Net cash used in investing activities (3.890) (13.242)

Cash flows to financing activitiesRepaymentofloans (7.907) (7.907)Dividendspaid (18.343) (15.826)Net cash used in financing activities (26.250) (23.733)

Net increase/(decrease) in cash and cash equivalents 286 (6.362)Cashandcashequivalentsat1January (27) 6.335Cash and cash equivalents at 31 December 24 259 (27)


NOTES TO THE FINANCIAL STATEMENTSfortheyearended31December2018

1. Reporting entity and principal activities

"ΤσιμεντοποιίαΒασιλικούΔημόσιαΕταιρείαΛτδ",translatedinEnglishas"VassilikoCementWorksPublicCompanyLtd"(the'Company')isacompanydomiciledinCyprusandisapubliccompanyinaccordancewiththerequirementsoftheCyprusCompaniesLaw,Cap.113andtheCyprusStockExchangeLawandRegulations.TheCompany'sregisteredofficeisat1AKyriakosMatsisAvenue,CY-1082Nicosia,Cyprus.

The consolidated financial statements of the Company as at and for the year ended 31 December 2018 comprise theCompanyanditssubsidiaries(togetherreferredtoasthe'Group')andtheGroup'sinterestinassociates.TheCompany'sandtheConsolidatedFinancialStatementswereauthorisedforissuebytheBoardofDirectorson11April2019.

Principal activitiesTheGroup'sprincipalactivityistheproductionofclinkerandcement,whicharesoldinthelocalandinternationalmarkets.TheGroupalsohasapresenceinaggregatesquarryingthroughitssubsidiaryandassociatecompanies.

2. Basis of preparation

Statement of complianceTheconsolidatedfinancialstatementshavebeenpreparedinaccordancewithInternationalFinancialReportingStandards("IFRS")asadoptedbytheEuropeanUnion("EU").Inaddition,thefinancialstatementshavebeenpreparedinaccordancewiththerequirementsoftheCyprusCompaniesLaw,Cap.113,andtheCyprusStockExchangeLawandRegulations.

Basis of measurementTheconsolidatedfinancialstatementshavebeenpreparedonthehistoricalcostbasis,modifiedtoincludetherevaluationtofairvalueoflandandbuildings,financialassetsatfairvaluethroughothercomprehensiveincomeandinvestmentproperty.

Functional and presentation currencyTheconsolidatedfinancialstatementsasatandfortheyearended31December2018arepresentedinEuro(€),whichistheCompany'sfunctionalcurrency.Allamountshavebeenroundedtothenearestthousand,unlessotherwiseindicated.

Use of estimates and judgmentsThepreparationoftheconsolidatedfinancialstatementsinaccordancewithIFRSrequiresfrommanagementtheexerciseofjudgment,tomakeestimatesandassumptionsthatinfluencetheapplicationofaccountingprinciplesandtherelatedamountsofassetsandliabilities,incomeandexpenses.Theestimatesandunderlyingassumptionsarebasedonhistoricalexperienceandvariousotherfactorsthataredeemedtobereasonablebasedonknowledgeavailableatthattime.Actualresultsmaydeviatefromsuchestimates.

The estimates and underlying assumptions are reviewed on a continuous basis. Revisions in accounting estimates arerecognisedintheperiodduringwhichtheestimateisrevised,iftheestimateaffectsonlythatperiod,orintheperiodoftherevisionandfutureperiods,iftherevisionaffectsthepresentaswellasfutureperiods.



2. Basis of preparation (continued)

In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accountingpoliciesthathavethemostsignificanteffectontheamountrecognisedinthefinancialstatementsaredescribedbelow:

a. Income taxesSignificantjudgmentisrequiredindeterminingtheprovisionforincometaxes.Therearetransactionsandcalculationsforwhichtheultimatetaxdeterminationisuncertainduringtheordinarycourseofbusiness.TheGrouprecognisesliabilitiesforanticipatedtaxauditissuesbasedonestimatesofwhetheradditionaltaxeswillbedue.Wherethefinaltaxoutcomeofthesemattersisdifferentfromtheamountsthatwereinitiallyrecorded,suchdifferenceswillimpacttheincometaxanddeferredtaxprovisionsintheperiodinwhichsuchdeterminationismade.

b. Measurement of fair valuesAnumberoftheGroup'saccountingpoliciesanddisclosuresrequirethemeasurementoffairvalues,forbothfinancialandnon-financialassetsandliabilities.TheGrouphasanestablishedcontrolframeworkwithrespecttothemeasurementoffairvalues.

Thisincludesavaluationteamthathasoverallresponsibilityforoverseeingallsignificantfairvaluemeasurements,includingLevel 3 fair values, and reports directly to the Chief Financial Officer. The valuation team regularly reviews significantunobservableinputsandvaluationadjustments.Ifthirdpartyinformation,suchasbrokerquotesorpricingservices,isusedtomeasurefairvalues,thenthevaluationteamassessestheevidenceobtainedfromthethirdpartiestosupporttheconclusionthatsuchvaluationsmeettherequirementsofIFRS,includingthelevelinthefairvaluehierarchyinwhichsuchvaluationsshouldbeclassified.SignificantvaluationissuesarereportedtotheGroup'sAuditCommittee.

Whenmeasuringthefairvalueofanassetoraliability,theGroupusesobservablemarketdataasfaraspossible.Fairvaluesarecategorizedintodifferentlevelsinafairvaluehierarchybasedontheinputsusedinthevaluationtechniquesasfollows:

- Level1-quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities. - Level2-inputsotherthanquotedpricesincludedwithinLevel1thatareobservablefortheassetorliability,eitherdirectly(i.e.asprices)orindirectly(i.e.derivedfromprices).

- Level3-inputsfortheassetorliabilitythatarenotbasedonobservablemarketdata(unobservableinputs).

Iftheinputsusedtomeasurethefairvalueofanassetoraliabilityfallintodifferentlevelsofthefairvaluehierarchy,thenthefairvaluemeasurementiscategorizedinitsentiretyinthesamelevelofthefairvaluehierarchyasthelowestlevelinputthatissignificanttotheentiremeasurement.

TheGrouprecognisestransfersbetweenlevelsofthefairvaluehierarchyattheendofthereportingperiodduringwhichthechangehasoccurred.

c. Provision for bad and doubtful debtsTheGroupreviewsitstradeandotherreceivablesforevidenceoftheirrecoverability.Suchevidenceincludesthecustomer'spaymentrecordandthecustomer'soverallfinancialposition.Ifindicationsofirrecoverabilityexist,therecoverableamountisestimatedandarespectiveprovisionforbadanddoubtfuldebtsismade.Theamountoftheprovisionischargedthroughtheprofitorloss.Thereviewofcreditriskiscontinuousandthemethodologyandassumptionsusedforestimatingtheprovisionarereviewedregularlyandadjustedaccordingly.



2. Basis of preparation (continued)

d. Impairment of investments in subsidiaries/associatesThe Company periodically evaluates the recoverability of investments in subsidiaries/associates whenever indicators ofimpairment are present. Indicators of impairment include such itemsasdeclines in revenues, earningsor cash flowsormaterialadversechangesintheeconomicorpoliticalstabilityofaparticularcountry,whichmayindicatethatthecarryingamountofanassetisnotrecoverable.Iffactsandcircumstancesindicatethatinvestmentinsubsidiaries/associatesmaybeimpaired,theestimatedfutureundiscountedcashflowsassociatedwiththesesubsidiaries/associateswouldbecomparedtotheircarryingamountstodetermineifawritedowntofairvalueisnecessary.

e. Impairment of goodwillDeterminingwhether goodwill is impaired requires an estimation of the value in use of the cash-generating units of theCompanyonwhichthegoodwillhasbeenallocated.ThevalueinusecalculationrequirestheCompanytoestimatethefuturecashflowsexpectedtoarisefromthecash-generatingunitsusingasuitablediscountrateinordertocalculatethepresentvalue.

3. Changes in accounting policies

TheGrouphasadoptedthefollowingnewstandards,amendmentstoastandardandnewinterpretationswithadateofinitialapplicationof1January2018.Thenatureandeffectsofthechangesareexplainedbelow.

IFRS 15 Revenue from Contracts with Customers:

• IFRS15establishesacomprehensiveframeworkfordeterminingwhether,howmuchandwhenrevenueisrecognised.ItreplacedIAS18Revenue,IAS11ConstructionContractsandrelatedinterpretations.UnderIFRS15,revenueisrecognisedwhenacustomerobtainscontrolofthegoodsorservices.Determiningthetimingofthetransferofcontrol-atapointintimeorovertime-requiresjudgement.

• TheGrouphasadoptedIFRS15usingthecumulativeeffectmethod(withoutpracticalexpedients),withtheeffectofinitiallyapplyingthisstandardrecognisedatthedateofinitialapplication(1January2018).

• DuetothetransitionmethodschosenbytheGroupinapplyingthesestandards,comparativeinformationthroughoutthesefinancialstatementshasnotbeenrestatedtoreflecttherequirementsofthenewstandards

• Accordingly,theinformationpresentedfor2017hasnotbeenrestatedanditispresentedaspreviouslyreportedunderIAS18,IAS11andrelatedinterpretations.Additionally, thedisclosurerequirements inIFRS15havenotgenerallybeenappliedtocomparativeinformation.

• Theadoptionof IFRS15 in theFinancialStatementsof theGrouphasnot resulted in significant changes in theopeningretainedearningsandintherevenuerecognition.



3. Changes in accounting policies (continued)

IFRS 9 Financial Instruments:

IFRS9setsoutrequirementsforrecognisingandmeasuringfinancialassets,financialliabilitiesandsomecontractstobuyorsellnon-financialitems.ThisstandardreplacesIAS39FinancialInstruments:RecognitionandMeasurement.AsaresultoftheadoptionofIFRS9,theGrouphasadoptedconsequentialamendmentstoIAS1PresentationofFinancialStatements,whichrequireimpairmentoffinancialassetstobepresentedinaseparatelineiteminthestatementofprofitorlossandOCI.Previously,theGroup'sapproachwastoincludetheimpairmentoftradereceivablesinotheroperatingexpenses.

Additionally,theGrouphasadoptedconsequentialamendmentstoIFRS7FinancialInstruments:Disclosuresthatareappliedtodisclosuresabout2018buthavenotbeengenerallyappliedtocomparativeinformation.

Thereisnoeffectontheopeningretainedearningson1January2018fromtheadoptionofIFRS9.

Classification and measurement of financial assets and financial liabilities

IFRS9containsthreeprincipalclassificationcategoriesforfinancialassets:measuredatamortisedcost,FVOCIandFVTPL.

TheclassificationoffinancialassetsunderIFRS9isgenerallybasedonthebusinessmodel inwhichafinancialasset ismanagedanditscontractualcashflowcharacteristics.IFRS9eliminatesthepreviousIAS39categoriesofheldtomaturity,loansandreceivablesandavailableforsale.UnderIFRS9,derivativesembeddedincontractswherethehostisafinancialassetinthescopeofthestandardareneverseparated.Instead,thehybridfinancialinstrumentasawholeisassessedforclassification.

IFRS9largelyretainstheexistingrequirementsinIAS39fortheclassificationandmeasurementoffinancialliabilities.

ForanexplanationofhowtheGroupclassifiesandmeasuresfinancialinstrumentsandaccountsforrelatedgainsandlossesunderIFRS9,seenote4“Significantaccountingpolicies”.

ThefollowingtableandtheaccompanyingnotesbelowexplaintheoriginalmeasurementcategoriesunderIAS39andthenewmeasurementcategoriesunder IFRS9 foreachclassof theGroup'sfinancialassetsandfinancial liabilitiesasat1January2018.TheeffectofadoptingIFRS9onthecarryingamountsoffinancialassetsat1January2018relatessolelytothenewimpairmentrequirements.



3. Changes in accounting policies (continued)

Group

Original classification under IAS 39

New classification unde

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