PKP CARGO’s information on the position of its subsidiary AWT in connection with OKD’s declaration of insolvency

Legal basis (selected in ESPI): Article 56 Section 1 Item 1 of the Act on Offerings – confidential information

The Management Board of PKP CARGO S.A. (“Company”, “PKP CARGO”) hereby reports on the position of its subsidiary AWT a.s. (“AWT”) and the actions it has taken in connection with OKD’s declaration of insolvency.

Since the AWT Group is a provider of rail transport services to OKD, the justified and expected action of OKD will be for it to treat the payment of amounts due to AWT as a priority, which is of particular significance for a mining company to preserve liquidity in its supply chain.

At present, services are still being provided by AWT to OKD; nevertheless, in order to preclude the risk of improper and untimely payment for freight, the principle has been implemented between the parties for prepayments to be made for the amounts due for the services provided.

It is important to note that OKD’s unfavorable financial standing will limit to a substantially lesser extent the operations of AWT Rekultivace a.s. that among others is active in post-industrial land reclamation, demolition work, closure of mine workings and the management of facilities designated to utilize waste. According to Czech law, the funds for the reclamation of land following the end of mining operations are secured during the course of mining activity.

Legal basis:
Article 56 Section 1 Item 1 of the Act on public offering and terms of introducing financial instruments into organized trading system and on public companies.