PhosAgro : Consolidated Interim Condensed Financial Statements for the 12 months ended 31 Decembrer 2022

PJSC "PhosAgro"

International Financial Reporting Standards

Consolidated Financial Statements and

Independent Auditor's Report

31 December 2022

PJSC "PhosAgro"

Contents
Independent Auditor's report
Consolidated Statement of Profit or Loss and Other Comprehensive Income	.............................................1
Consolidated Statement of Financial Position	2
Consolidated Statement of Cash Flows	3
Consolidated Statement of Changes in Equity	4
Notes to the Consolidated Financial Statements
1	Background	5
2	Basis of preparation	6
3	Significant accounting policies	8
4	Determination of fair values	16
5	Seasonality	16
6	Revenues	17
7	Cost of Group products sold	17
8	Administrative and selling overhead expenses	17
9	Taxes, other than income tax, net	18
10	Other expenses, net	18
11	Finance income and finance costs	18
12	Income tax expense	18
13	Property, plant and equipment	19
14	Right-of-use assets	20
15	Investments in associates	21
16	Deferred tax assets and liabilities	21
17	Other non-current assets	22
18	Other financial assets	23
19	Inventories	24
20	Trade and other receivables	24
21	Cash and cash equivalents	25
22	Equity	25
23	Earnings per share	26
24	Loans and borrowings	27
25	Leases	28
26	Defined benefit obligations	28
27	Trade and other payables	29
28	Financial risk management	29
29	Loss of control over foreign subsidiaries	34
30	Commitments	35
31	Contingencies	35
32	Related party transactions	36
33	Significant subsidiaries	37
34	Subsequent events	37

Joint-Stock Company	White Square Office Center,
"Technologies of Trust - Audit"	10 Butyrsky Val, Moscow,
("Technologies of Trust - Audit" JSC)	Russian Federation, 125047
	T: +7 (495)	967	6000,
www.tedo.ru	F: +7 (495)	967	6001

Independent Auditor's Report

To the Shareholders and Board of Directors of Public Joint Stock Company "PhosAgro":

Qualified opinion

In our opinion, except for the effects of the matter described in the Basis for qualified opinion section of our report, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of Public Joint Stock Company "PhosAgro" (the "Company") and its subsidiaries (together - the "Group") as at

31 December 2022, and the Group's consolidated financial performance and consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS).

What we have audited

The Group's consolidated financial statements comprise:

• the consolidated statement of profit or loss and other comprehensive income for 2022;
• the consolidated statement of financial position as at 31 December 2022;
• the consolidated statement of cash flows for 2022;
• the consolidated statement of changes in equity for 2022; and
• the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for qualified opinion

The Group has not disclosed segment information as required by IFRS 8, Operating Segments for the year ended 31 December 2022 and for the comparative period.

Considering the significant volume of undisclosed segment information required by IFRS 8, Operating Segments, presenting this undisclosed information in our audit opinion is not practicable.

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report.

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

Independence

We are independent of the Group in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code) and the ethical requirements of the Auditor's Professional Ethics Code and Auditor's Independence Rules that are relevant to our audit of the consolidated financial statements in the Russian Federation. We have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Basis for qualified opinion section, we have determined the matters described below to be the key audit matters to be communicated in our report.

www.tedo.ru

	Key audit matter		How our audit addressed the key audit matter
	Effect of changes in current economic
	situation on the consolidated financial
	statements of the Group
	Refer to Notes 1 (b) and 29 to the		We performed the following audit procedures in respect of this key
	consolidated financial statements of the		audit matter:
	Group		• We performed inquiries of management in respect of how the
	In 2022, there were significant changes in
		changes in current economic environment have affected the
	the economic environment in which the		Group and its financial performance measures.
	Group operates, commodity and financial		• We tested compliance with debt covenants under the Group's
	markets demonstrated increased volatility.
		loan obligations, received documents in respect of changes
	The imposition of the restrictive measures
		made in 2022 in debt securities repayment mechanism and
	against a number of Russian entities led to
		terms of service of Eurobonds. We confirmed that loan
	the restricted access to European and USA
		obligations of the Group denominated in foreign currency were
	financial markets and a risk that USD-
		fulfilled timely and in full amount.
	denominated coupon payments on the
	Group's Eurobonds will not reach the final		• We have analysed terms of sales contracts to identify new non-
	debt securities holders through foreign		standard sales terms, performed detailed testing of the
	paying agents.
		supporting documents and received on a sample basis a third
	Among other changes, economic		party confirmation to ensure sales revenue is recognised
		properly and in correct period in the consolidated financial
	environment developments led to changes
		statements.
	in the Group structure, as described in note
	29 to the consolidated financial statements,		• We performed analytical procedures of revenues by main
	and affected a number of elements of the		products, including comparison with market prices to ensure that
	consolidated financial statements.
		changes in the Group revenue are in line with market trends.
	We focus on this matter due to significance		• We tested changes in the Group structure, in particular we:
	of potential impact of changes in the		- analysed the agreement and key terms of the transaction for
	economic environment in which the Group
	operates on its consolidated financial		disposal of foreign subsidiaries of the Group;
	statements and significant management's		- assessed and challenged management conclusions relating
	judgement required in respect of certain
		to loss of control by the Group;
	transactions and balances.
		- assessed reasonableness of management assumptions
			applied for estimation of fair value of the Group's 5%
			investment in Phosint Limited;
			- examined accounting transactions for disposal of these
			companies in the consolidated financial statements of the
			Group;
			- analysed management's calculation of allowance for
			expected credit losses in respect of receivable accrued as a
			result of disposal.
			• We assessed reasonableness of the following key assumptions
			used by management for calculation of allowance for expected
			credit losses in respect of trade and other receivables: credit
			rating of the debtor, probability of default and loss given default.
			• We analysed events after the reporting date for existence of
			circumstances which could have significant adverse effect on the
			consolidated financial position and consolidated financial
			performance of the Group.

2

www.tedo.ru

Other matter - Materiality and Group audit scope

Overview

	Materiality	Overall Group materiality: Russian Roubles ("RUB") 11,615 million, which
		represents 5% of profit before tax.
	Group scoping	• We conducted audit work at all significant reporting units in the Russian
		Federation and abroad.
		• Our audit scope addressed 94% of the Group's revenues and 94% of the
		Group's absolute value of underlying profit before tax.

Materiality

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated financial statements. In particular, we considered where management made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls including, among other matters, consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements.

Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall Group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, if any, both individually and in aggregate on the consolidated financial statements as a whole.

	Overall Group materiality	RUB 11,615 million (2021: RUB 8,003 million)
	How we determined it	5% of profit before tax
	Rationale for the materiality	We chose profit before tax as the benchmark because, in our view, it is the
	benchmark applied	benchmark against which the performance of the Group is most commonly
		measured by users, and is a generally accepted benchmark. We chose 5%
		which is consistent with quantitative materiality thresholds used for profit-
		oriented companies in this sector

How we tailored our Group audit scope

We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the consolidated financial statements as a whole, taking into account the structure of the Group, the accounting processes and controls, and the industry in which the Group operates.

Our group audit was focused on the significant components in the Russian Federation and abroad. For components which are individually financially significant we performed an audit of their complete set of financial information. The audit work for the significant components in the Russian Federation and abroad was performed by the group auditor. We also included information systems and tax specialists in our group audit team.

By performing the above procedures at the components, combined with additional procedures at the Group level, we have obtained sufficient and appropriate audit evidence regarding the consolidated financial statements of the Group as a whole.

3