4 Segment information

The Management Board sets performance targets, approves and monitors the budgets prepared by operating segments. operating segments are not identical to the strategic sectors.

FMO's strategic sectors represent the economic sectors in which FMO operates. The three strategic sectors are Agribusiness Food & Water, Financial Institutions and Energy, which also represent economic sectors. FMO's Management Board steers on the following five operating segments: Agribusiness, Food & Water, Financial Institutions, Energy, Private Equity and Other.

In the first half of 2022, two transactions are transferred from Financial Institutions to Agribusiness Food & Water. This transfer amounted up to €5.9 million in total. In addition, one transaction was transferred from Energy to PE, the loan was converted to equity. The total amount of the transfer was for €3.5 million.

FMO presents the results of the operating segments using a financial performance measure called underlying profit. Underlying profit excludes the EUR/USD currency effects related to the results from equity investments. All fair value changes including currency effects are recorded in the profit and loss account.

Underlying profit as presented below is an alternative performance measure. The table below shows a reconciliation of the underlying net profit to the net profit.

At June 30, 2022	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Interest income	61,272	50,927	26,304	1,137	2,665	142,305
Interest expenses	-4,644	-5,183	-2,228	-8,627	-2,771	-23,453
Net fee and commission income	-652	402	-1,165	514	-220	-1,121
Dividend income	-	-	-	31,998	-	31,998
Results from equity investments	-	-	-	-4,012	-	-4,012
Results from financial transactions	-9,176	4,551	-8,815	-5,328	30,292	11,524
Remuneration for services rendered	2,076	4,010	1,896	6,099	3,883	17,964
Gains and losses due to recognition	3	-	-	-	-	3
Other operating income	-	-	-	-	-167	-167
Allocated income	7,148	7,976	3,428	13,277	-31,829	-
Total underlying income	56,027	62,683	19,420	35,058	1,853	175,041

Operating expenses	-19,614	-17,156	-12,609	-22,863	-1,147	-73,389
Total operating expenses	-19,614	-17,156	-12,609	-22,863	-1,147	-73,389

Impairments on loans and guarantees	-3,386	-66,823	-43,481	-951	-1	-114,642
Total impairments	-3,386	-66,823	-43,481	-951	-1	-114,642

Profit/(loss) before taxation	33,027	-21,296	-36,670	11,244	705	-12,990
Share in results from associates	-	-	-	-15,357	-	-15,357
Taxation	-8,257	5,324	9,167	4,093	-176	10,151
Underlying net profit/(loss)	24,770	-15,972	-27,503	-20	529	-18,196

Currency effect equity investments	-	-	-	120,208	-	120,208
Net profit/(loss)	24,770	-15,972	-27,503	120,188	529	102,012

Segment assets at June 30, 2022	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Loans to the private sector	2,304,890	1,532,560	980,092	25,813	13,608	4,856,963
Equity investments and investments in associates	-	-	-	2,524,707	-	2,524,707
Other assets	713,753	474,586	303,504	789,817	4,213	2,285,873
Total assets	3,018,643	2,007,146	1,283,596	3,340,337	17,821	9,667,543
Contingent liabilities – Effective guarantees issued	63,896	20,179	13,326	562	-	97,963
Assets under management (loans and equity investments) managed for the risk of the state	148,015	187,856	155,193	607,797	-	1,098,861

At June 30, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Interest income	52,425	53,361	24,055	2,038	4,231	136,110
Interest expenses	-3,428	-3,962	-1,857	-4,910	-1,438	-15,595
Net fee and commission income	1,110	6,515	24	175	-174	7,650
Dividend income	-	-	-	9,850	-	9,850
Results from equity investments	-	-	-	57,412	-	57,412
Results from financial transactions	3,355	-7,688	-2,055	-2,368	6,027	-2,729
Remuneration for services rendered	2,261	2,994	1,928	4,179	3,178	14,540
Gains and losses due to recognition	-	58	1,094	-	-	1,152
Other operating income	-	-	-	-	59	59
Allocated income	2,338	2,702	1,266	3,349	-9,655	-
Total underlying income	58,061	53,980	24,455	69,725	2,228	208,449

Operating expenses	-14,845	-13,621	-11,597	-17,030	-8,494	-65,587
Total operating expenses	-14,845	-13,621	-11,597	-17,030	-8,494	-65,587

Impairments on loans and guarantees	21,900	5,480	3,688	-724	-2,098	28,246
Total impairments	21,900	5,480	3,688	-724	-2,098	28,246

Profit/(loss) before taxation	65,116	45,839	16,546	51,971	-8,364	171,108
Share in results from associates	-	-	-	8,789	-	8,789
Taxation	-15,810	-11,129	-4,017	3,060	2,091	-25,805
Underlying net profit/(loss)	49,306	34,710	12,529	63,820	-6,273	154,092

Currency effect equity investments	-	-	-	44,305	-	44,305
Net profit/(loss)	49,306	34,710	12,529	108,125	-6,273	198,397

Segment assets at June 30, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Loans to the private sector	1,995,172	1,547,624	932,038	35,749	61,460	4,572,043
Equity investments and investments in associates	-	-	-	2,144,423	-	2,144,423
Other assets	824,854	639,827	385,328	901,338	25,408	2,776,755
Total assets	2,820,026	2,187,451	1,317,366	3,081,510	86,868	9,493,221
Contingent liabilities – Effective guarantees issued	78,726	43,994	-	496	-	123,216
Assets under management (loans and equity investments) managed for the risk of the state	150,460	180,279	149,735	514,605	-	995,079