FINANCIAL REPORT

For the Financial Year from 01.01.2023 to 31.12.2023 ACCORDING TO THE INTERNATIONAL

FINANCIAL REPORTING STANDARDS (as adopted by the European Union)

March 2024

[Business/Internal Use]

TABLE OF CONTENTS

Independent auditor's report ..................................................................................................................... 39

  • 1. Statement of Financial Position ...................................................................................................... 43

  • 2. Income Statement and statement of comprehensive income ......................................... 44

  • 3. Statement of Changes in Equity ...................................................................................................... 45

  • 4. Cash Flow Statement ............................................................................................................................. 46

NOTES ON THE FINANCIAL STATEMENTS ........................................................................................................................ 47

  • 1. General information ............................................................................................................................. 47

  • 2. Nature of operations - Overview .................................................................................................... 47

  • 3. Basis of preparation .............................................................................................................................. 48

  • 4. Summary of significant accounting policies ............................................................................ 54

  • 5. Operating segments .............................................................................................................................. 64

  • 6. Intangible assets ..................................................................................................................................... 65

  • 7. Property, plant and equipment ....................................................................................................... 67

  • 8. Right-of-use assets & Lease liabilities ......................................................................................... 68

  • 9. Deferred tax assets ................................................................................................................................ 69

  • 10. Cash and cash equivalents ................................................................................................................. 70

  • 11. Trade receivables ................................................................................................................................... 70

  • 12. Other current assets .............................................................................................................................. 71

  • 13. Equity ............................................................................................................................................................ 71

  • 14. Borrowings ................................................................................................................................................. 72

  • 15. Other non-current liabilities ............................................................................................................ 72

  • 16. Trade payables ........................................................................................................................................ 72

  • 17. Other current liabilities ...................................................................................................................... 73

  • 18. GGR contribution ..................................................................................................................................... 74

  • 19. Agents' commissions ............................................................................................................................. 74

  • 20. Other Direct cost ..................................................................................................................................... 74

  • 21. Other operating income ...................................................................................................................... 75

  • 22. Payroll expenses ...................................................................................................................................... 75

  • 23. Marketing expenses ............................................................................................................................... 75

  • 24. Other operating expenses .................................................................................................................. 76

  • 25. Net impairment losses on financial assets ................................................................................ 76

  • 26. Financial income/(cost) ...................................................................................................................... 76

  • 27. Income tax .................................................................................................................................................. 77

  • 28. Losses per share ...................................................................................................................................... 77

  • 29. Related party disclosures ................................................................................................................... 78

  • 30. Other disclosures .................................................................................................................................... 79

  • 31. Financial risk factors ............................................................................................................................ 80

  • 32. Subsequent events .................................................................................................................................. 87

A. REPRESENTATION OF THE MEMBERS OF THE BOARD OF DIRECTORS

The Members of the Board of Directors for HELLENIC LOTTERIES S.A. (the "Company"):

  • • Jan Karas, Chairman and Chief Executive Officer,

  • • Fotis Zisimopoulos, Member,

  • • Pavel Mucha, Member and Chief Financial Officer

Certify and declare, as far as we know, that:

a) The Financial Statements for HELLENIC LOTTERIES S.A. for the financial year from 1st of January 2023 to 31st of December 2023 which were prepared in accordance with International

Financial Reporting Standards ("IFRS") as adopted by the European Union ("EU"), truthfully represent the Issuer's assets, liabilities, equity and income.

b) The Board of Directors' report reflects the Company's true evolution, performance and position as well as the description of the principal risks and uncertainties that it faces.

Athens, 27 March 2024

Chairman of the BoD & Chief Executive OfficerMember of BoD

Member of the BoD & Chief Financial OfficerJan Karas

Fotis Zisimopoulos

Pavel Mucha

B. BOARD OF DIRECTORS' REPORT

Under the provisions of the articles 150-154 of L.4548/2018 and the Company's Articles of

Association, we submit for the financial year from 01.01.2023 to 31.12.2023 the Annual Report of the Board, which includes the audited corporate Financial Statements, including the notes to the Financial Statements. The present report includes information pertaining to the company HELLENIC LOTTERIES S.A. - SOCIETE ANONYME FOR THE PRODUCTION, OPERATION, CIRCULATION, PROMOTION AND MANAGEMENT OF LOTTERIES (under the name "HELLENIC LOTTERIES S.A.").

The report describes the financial results of the Company for the period 01.01.2023 to 31.12.2023, as well as the significant events which took place in 2023 and the most significant events after the year end. The report also contains, a description of the main risks and uncertainties and the expected course and development of the Company, the corporate governance, the dividend policy, the number and the nominal value of shares and finally, the material transactions with the Company's related parties.

1. GENERAL INFORMATION

HELLENIC LOTTERIES S.A. (the "Company") was established on 15.06.2013 and is based in Athens at Athinon Avenue 112. Its purpose of business is the production, operation, distribution, promotion and the overall management of all state lotteries (Popular - National - European - Instant State Lottery - SCRATCH - State Housing Lottery - Special Social National Lottery - New Year's Eve lottery, as well as any other future State Lottery), under the terms and conditions of the Concession Agreement of 30.07.2013 with the Hellenic Republic Asset Development Fund, the general Greek legal and regulatory framework as well as the specific regulations of lotteries.

Number and nominal value of shares

The share capital on 31.12.2023 amounts to € 204 th., divided into 5,100,000 ordinary registered shares worth € 0.04 each. There was a change in the share capital structure compared to the year ended 31.12.2022, following the General Meeting of the Shareholders that took place on 30.06.2023, which approved a share capital increase by € 80 th. paid in cash, with preemption rights and the issuance of 2,000,000 new common registered shares at a nominal value of € 0.04 each and issue price of €10.00 per share. As a result, share capital on 31.12.2023 amounts to € 204 th. divided into 5,100,000 ordinary shares with a nominal value of € 0.04 each.

The shareholder structure involves OPAP INVESTMENT LIMITED with an 83.50% stake, and

SCIENTIFIC GAMES GLOBAL GAMING S.á.r.l. with a 16.50% stake of the Company's ordinary shares.

Other Information

Legal Form: Société Anonyme

General Electronic Commercial Registry No: 125891401000 Chamber: Athens Chamber of Commerce and Industry VAT No.: 800500383

Auditors: PricewaterhouseCoopers SA, SOEL Reg. No 113, Socrates Leptos - Bourgi, Certified Auditor Accountant (SOEL Reg. No 41541).

2. FINANCIAL PROGRESS AND PERFORMANCES OF FINANCIAL YEAR 2023

For the fiscal year 2023, economic figures are as follows:

(Amounts in thousands of euro)

2023

2022

Δ

Revenue (GGR)

115,877

107,902

7.4%

GGR contribution

(50,000)

(50,000)

-

Net gaming revenue (NGR)

65,877

57,902

13.8%

Profit before interest, tax, depreciation and amortization (EBITDA)

9,885

3,233

205.8%

Loss before Tax

(20,772)

(32,114)

35.3%

Loss after Tax

(37,502)

(27,920)

(34.3%)

Net (decrease) / increase in cash and cash equivalents

(39,461)

13,014

(403.2%)

Cash (outflows) / inflows from operating activities

(61,004)

23,193

(363.0%)

Cash inflows / (outflows) from investing activities

1,567

(106)

1.574.0%

Cash inflows / (outflows) from financing activities

19,976

(10,073)

298.3%

In 2023, the Company demonstrated a solid financial performance in terms of Revenue (GGR) and Net gaming revenue (NGR), remarkably increased compared to the previous year. This growth is primarily attributed to the Scratch performance, followed by the Popular lottery performance, and was reflected in Company's EBITDA.

Despite the increase in gaming and operating activity, the Company recorded a Loss before Tax and after Tax during the year 2023. This is attributed to the imposition of default interest of € 12,462 th. resulting from the overdue payment of the disputed Minimum Annual Fee for the years 2020, 2021 and 2022 as well as the impairment of € 6,274 th. of its Right of Game.

Finally, as far as the operating cash outflows are concerned, the Company on 02.10.2023 paid, with reservation to the Hellenic Republic, the disputed amount of the Minimum Annual Fee for the years 2020, 2021 and the period January-May 2022 of € 70,668 th. while the financing inflows mainly relate to the share capital increase of € 20,000 th..

(Amounts in thousands of euro)

31.12.2023

31.12.2022

Net loss attributable to the shareholders

(37,502)

(27,920)

Weighted average number of ordinary shares

4,100

3,100

Basic losses per share (in €)

(9.1469)

(9.0065)

The GGR of each game and its contribution as a percentage (%) in total GGR for the two comparative periods is presented in the graphs below:

3. SIGNIFICANT EVENTS DURING FINANCIAL YEAR 2023 AND THEIR EFFECT ON THE

FINANCIAL STATEMENTS

1. Scratch games

The Company continues to actively invest in its portfolio by offering even more options to players. During fiscal year 2023, HELLENIC LOTTERIES S.A. updated the products it offers by adding 11 new scratch games. At the same time, during the current year, the Company proceeded to the expiration of 36 scratch games according to the predetermined procedure, as Management's assessment concluded that the relevant codes were no longer commercial. As at 31.12.2023 the active scratch games amount to 42.

2. London Court of International Arbitration Final Award on HELLENIC LOTTERIES S.A. Request for Arbitration

On 12.09.2023 the London Court of International Arbitration (the "LCIA") issued its Final

Award and rejected the Request for Arbitration filed by HELLENIC LOTTERIES S.A. against the Hellenic Republic and the Hellenic Asset Development Fund (HRADF) - LCIA case no. 215123, seeking a declaration that the Company is released (wholly or partially) from its obligation to pay the Minimum Annual Fee provided in the Concession Agreement of 30.07.2013 for the years 2020, 2021 and for the period January - May 2022, due to the adverse impact of the Covid-19 related State measures on the operations of the Company. Following this, the Company paid on 02.10.2023, with reservation to the Hellenic Republic, the disputed amount of the Minimum Annual Fee for the years 2020, 2021 and the period January-May 2022

(amounting to €70,668 th. in total).

Furthermore, on 13.02.2024 and later on 05.03.2024, the Company was notified by the General Secretariat of Public Property of the Greek Ministry of Economy and Finance, of additional liabilities to the Greek State amounting to € 11,891 th. and € 571 th. respectively, related to the default interest resulting from the overdue payment of the disputed Minimum Annual Fee for the years 2020, 2021 and 2022. The amounts were paid on 28.02.2024 and 08.03.2024 respectively.

With regards to the impact of the aforementioned events on the Company's Financial Statements, the Company had already formed the accruals corresponding to the Minimum Annual Fee in dispute (i.e. € 70,668 th.) during the period January 2020 - May 2022 at each respective reporting period and recognized the corresponding deferred tax asset. However, no accrual was formed regarding the additional default interest charges. Therefore, the Profitafter tax of the Company for the year 2023 was impacted by the abovementioned default interest of € 12,462 th. and the reversal of the deferred tax asset.

3. Share capital increase

The Board of Directors of the Company decided on 29.03.2023 to propose to the shareholders the increase of the Company's Share Capital. The Annual General Meeting of the Company dated 30.06.2023 approved the issuance of 2,000,000 new ordinary shares of € 0.04 nominal price at an issue price of € 10.00 each (i.e. at a € 9.96 share premium each). Consequently, the Share Capital of the Company increased by € 80 th. and its Share Premium reserve by € 19,920 th.. The respective amount was paid on 27.07.2023 by OPAP INVESTMENT LTD and on 11.08.2023 by the other shareholder, SCIENTIFIC GAMES GLOBAL GAMING S.á.r.l..

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OPAP SA - Greek Organisation of Football Prognostics published this content on 29 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 March 2024 11:09:33 UTC.