Atrys Health S A : 2020 Consolidated financial statements (EN).

ATRYS HEALTH, S.A. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED MANAGEMENT REPORT FOR THE FINANCIAL YEAR 2020 PREPARED IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) AS ADOPTED BY THE EUROPEAN UNION TOGETHER WITH THE AUDIT REPORT ON THE CONSOLIDATED ANNUAL ACCOUNTS ISSUED BY AN INDEPENDENT AUDITOR

(Translation of the consolidated financial statements originally issued in Spanish. In the event of discrepancy, the Spanish Language version prevails)

ATRYS HEALTH, S.A. AND SUBSIDIARIES

Consolidated Annual Accounts and Consolidated Management

Report for the financial year 2020 prepared in accordance with

International Financial Reporting Standards (IFRS) adopted by the

European Union together with the Auditor's Report on Consolidated

Annual Accounts issued by an Independent Auditor.

AUDIT REPORT ON THE CONSOLIDATED ANNUAL ACCOUNTS ISSUED BY AN INDEPENDENT AUDITOR

CONSOLIDATED ANNUAL ACCOUNTS FOR THE FINANCIAL YEAR 2020:

Consolidated Statements of Financial Position as of December 31, 2020 and 2019. Consolidated Statements of Comprehensive Income for the financial years 2020 and 2019. Consolidated Statements of Other Consolidated Comprehensive Income for the financial year 2020 and 2019.

Consolidated Statements of Changes in Shareholders' Equity for the years 2020 and 2019. Consolidated Cash-Flow Statements for the financial years 2020 and 2019.

Explanatory notes to the Consolidated Annual Accounts for the financial year 2020.

CONSOLIDATED MANAGEMENT REPORT FOR THE YEAR 2020

ATRYS HEALTH S.A.AND SUBSIDIARIES

AUDIT REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT AUDITOR

Audit report on the consolidated financial statements

issued by an independent auditor

(Free translation from the report originally issued in Spanish.

In the event of discrepancy, the Spanish-language version prevails)

To the shareholders of ATRYS HEALTH, S.A.:

Report on the consolidated financial statements

Opinion

We have audited the consolidated financial statements for ATRYS HEALTH, S.A. AND SUBSIDIARIES, which comprise the statement of financial position as at December 31st, 2020, the statement of comprehensive income, the statement of changes in equity, the statement of cash flows and the explanatory notes, all of which are consolidated, for the financial year 2020.

In our opinion, the accompanying consolidated financial statements give, in all significant respects, a true and fair view of the consolidated assets and financial position of ATRYS HEALTH, S.A. AND SUBSIDIARIES as at 31 December 2020 and of its consolidated results and cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and other applicable Spanish financial reporting standards.

Basis of opinion

We conducted our audit in accordance with the regulations governing the auditing of accounts in force in Spain. Our responsibilities under those standards are described below in the section on the Auditor's responsibilities for the audit of the consolidated financial statements in our report.

We are independent from the Company in accordance with ethical requirements, including independence requirements, which are applicable to our audit of the financial statements in Spain as required by the regulations governing the auditing activity. In this regard, we have not provided services other than those relating to the auditing of financial statements, nor have there been any situations or circumstances which, in accordance with the provisions of the aforementioned regulatory regulations, have affected the necessary independence in such a way that it has been compromised.

We believe that the audit evidence we have obtained provides a sufficient and appropriate basis for our qualified opinion.

Key aspects of the audit

The key aspects of the audit are those, which, in our professional judgement, have been the most significant risks of material misstatement in our audit of the consolidated financial statements for the current period. These risks have been addressed in the context of our audit of the consolidated financial statements, and in forming our opinion thereon, and we do not express a separate opinion on these risks.

	II
Key aspects of the audit	Audit Response
R&D project assessment risk	We have carried out the following audit
	procedures, among others:

As indicated in Note 4 of the accompanying explanatory notes, at 31 December 2020 the Group's consolidated assets included intangible assets valued at 21.406.896,94 euros, consisting of research and development projects, most of which are in progress. These projects were measured in accordance with the valuation standards described in Note 3.b of the accompanying explanatory notes. In turn, consolidated liabilities include capital and interest rate grants amounting to 6.023.792,03 euros, which are closely linked to the aforementioned development projects and will be recognised in the income statement as they were amortised.

The analysis of the future viability of R&D projects made by the Parent Company's Board of Directors is based on highly technical studies, hypotheses, and projections, as well as on obtaining funding to complete the projects in accordance with the planned investment schedule. These matters require the application of significant value judgements and estimates and add uncertainty and a relevant risk component during our audit.

• Understanding of the accounting policies followed in the process of activation of R&D projects and analysing possible impairment of these assets.
• Monitoring of the evolution of all projects since the close of the previous financial year and analysis of deviations from the planned investment schedule.
• Evaluation of the criteria set by the Company for allocating research and development expenses to each of the projects.
• Obtaining for a sample of the most relevant projects, the documentary support of the amounts capitalized during the year.
• Enquire with the Management and those responsible for each project, about the viability of the projects and request for written statements regarding those.
• Obtaining for each Project, an analysis by management of the expected future profitability based on comparable studies and verifications that, based on these studies, the capitalized R&D projects are recoverable.
• Obtaining a business plan from the Parent Company and the Group, together with a cash budget, to prove Group's ability to meet the investments pending, in accordance with the schedule for each project, until its complete execution.
• Monitoring of compliance of these business plans up to the date of our audit report.
• Review of the information disclosured in the report on the consolidated annual financial statements in relation to the aforementioned projects.