Grupa LOTOS S A : 8.2 Resolution of the Supervisory Board concerning adoption of the Supervisory Board‘s report on the results of assessment of the financial statements of Grupa LOTOS S.A. for 2021, the consolidated financial statements of the LOTOS Group for 2021, the Directors’ Report on the operations of Grupa LOTOS S.A. and the LOTOS Group in 2021, and the Management Board’s motion concerning distribution of profit.

RESOLUTION NO. 291/XI/2022

OF THE SUPERVISORY BOARD OF GRUPA LOTOS S.A.

of May 19th 2022

concerning: adoption of the Supervisory Board's report on the results of assessment of the financial statements of Grupa LOTOS S.A. for 2021, the consolidated financial statements of the LOTOS Group for 2021, the Directors' Report on the operations of Grupa LOTOS S.A. and the LOTOS Group in 2021, and the Management Board's proposal concerning allocation of net profit for 2021

Acting pursuant to Art. 382.3 of the Commercial Companies Code and Art. 13.2.5 of the Articles of Association of the Company, in accordance with Art. 388.1(1) of the Commercial Companies Code, the Supervisory Board of Grupa LOTOS S.A. resolves as follows:

Section 1

1. Considering the positive recommendation of the Audit Committee and having read the documents listed in items a) to d) below, the Supervisory Board adopts the report on the results of assessment of:
2. 1. the separate financial statements of Grupa LOTOS S.A. for 2021,
   2. the consolidated financial statements of the LOTOS Group for 2021,
   3. the Directors' Report on the operations of Grupa LOTOS S.A. and the LOTOS Group in 2021,
   4. the Management Board's proposal concerning allocation of net profit for 2021.
3. The report referred to in Section 1.1 above is attached as an appendix hereto.

Section 2

The Supervisory Board resolves to submit the report referred to in Section 1.1 to the Annual General Meeting of Grupa LOTOS S.A.

Section 3

This Resolution shall become effective upon its adoption.

1.	Votes in favour of the resolution: _______ 6_____	Members of the Supervisory Board
2.	Votes against of the resolution:	_______0_____	Members of the Supervisory Board
3.	Abstaining votes:	_______0_____	Members of the Supervisory Board

The resolution has been passed by open ballot.

Supervisory Board:

1. Beata Kozłowska-Chyła

2. Piotr Ciach

Vote cast using means of remote communication

1. Katarzyna Lewandowska
2. Dariusz Figura
3. Katarzyna Maćkowska
4. Grzegorz Rybicki

Vote cast using means of remote communication

7. Rafał Włodarski

Appendix to Resolution No. 291/XI/2022 of the Supervisory Board of Grupa LOTOS S.A. of May 19th 2022

Report of the Grupa LOTOS Supervisory Board on the results of assessment of the financial statements of Grupa LOTOS and the consolidated financial statements of the LOTOS Group for 2021, and the Directors' Report on the operations of Grupa LOTOS S.A and the LOTOS Group in 2021, as well as of the Management Board's proposal concerning allocation of profit for 2021, along with recommendation

Acting pursuant to Art. 2.1.5 of the Rules of Procedure for the Supervisory Board of Grupa LOTOS S.A. and Art. 13.2.5 of the Articles of Association, the Supervisory Board of Grupa LOTOS S.A. gives a positive assessment of the consolidated financial statements of the LOTOS Group for the year ended December 31st 2021, the separate financial statements of Grupa LOTOS S.A. for the year ended December 31st 2021, and the Directors' Report on the operations of Grupa LOTOS S.A. and the LOTOS Group in 2021.

The assessment is based on:

• contents of the financial statements and reports referred to above, submitted and discussed by the Management Board of Grupa LOTOS S.A.,
• auditor's reports on the separate and consolidated financial statements and the audit firm's additional report for the Audit Committee of the Supervisory Board of Grupa LOTOS S.A.,
• meetings with representatives of the audit firm Deloitte Audyt Spółka z ograniczoną odpowiedzialnością Sp. k., appointed by the Supervisory Board to audit the financial statements of the Company and the Group, including with the lead auditor.

In its assessment, the Supervisory Board took into consideration the following:

In 2021, the LOTOS Group's operating profit before depreciation and amortisation and adjusted for one-off items (adjusted LIFO-based EBITDA) was PLN 4,229.1 million, compared with PLN 1,356.6 million in 2020 (an increase of 211.7%). The Group's net profit was PLN 3,211.8 million, compared with a net loss of PLN -1,146.2 million in 2020.

Key drivers of the LOTOS Group's performance:

• Revenue was PLN 33,123.6 million, having increased by PLN 12,215.0 million (58.4%) on 2020, mainly as a result of rising prices of crude oil and petroleum products on global markets. The average net revenue per tonne of the volume sold in 2021 was PLN 2,943, an increase of PLN 1,173 (66.3%) relative to 2020.
• Gross profit was reported at PLN 6,348.5 million (an increase of PLN 4,881.6 million on
  2020), driven by rising crude oil prices and high petroleum product crack spreads. As the
  Group applies the weighted average cost method to measure inventories, the impact of price changes on cost of sales is deferred in time. Therefore, Grupa LOTOS presents its earnings net of inventory valuation, i.e. as LIFO-based EBIT and LIFO-based EBITDA, which more accurately approximate the Refining & Marketing segment's actual profitability.
• Distribution costs increased by 3%, mainly as a result of the increase in the number of service stations in the LOTOS chain and higher volumes of fuels sold at the service stations;

Appendix to Resolution No. 291/XI/2022 of the Supervisory Board of Grupa LOTOS S.A. of May 19th 2022

• A 6.3% increase was recorded in administrative expenses, attributable mainly to higher employee benefits;
• Net other income of PLN 138.4 million was attributable mainly to reversal of impairment losses in the Exploration & Production segment;
• Net finance costs of PLN -26.0 million.

As a result of the application of cash flow hedge accounting with respect to foreign-currency loans contracted to finance the 10+ Programme, intended as hedges of future USD-denominated petroleum product sales transactions, in 2021 foreign exchange losses on cash flow hedges of

PLN -35.7 million were taken to reserve capital.

Table 1. Key items of the LOTOS Group's statement of profit or loss (PLNm)

		2021		2020	2021/2020
					(PLNm)	(%)
Revenue	33,123.6	20,908.6	12,215.0	58.4%
Cost of sales		-26,775.1		-19,441.7	-7,333.4	37.7%
Selling expenses		-1,455.3		-1,412.9	-42.4	3.0%
Administrative expenses	-553.7		-521.0	-32.7	6.3%
Net other income/(expenses)	138.4	-929.8	1,068.2	-
Operating profit/(loss)	4,477.9		-1,396.8	5,874.7	-
Net finance income/(costs)	-26.0	-254.1	228.1	-89.8%
Share in net profit/(loss) of equity-accounted joint		4.6		-1.9	6.5	-
ventures
Profit/(loss) before tax	4,456.5		-1,652.8	6,109.3	-
Income tax	-1,244.7		506.6	-1,751.3	-345.7%
Net profit/(loss), of which:	3,211.8	-1,146.2	4,358.0	-
- attributable to owners of the parent	3,211.8		-1,146.2	4,358.0	-

Source: the Company.

Revenue

In 2021, the LOTOS Group's revenue was PLN 33,123.6 million (an increase of 58.4% year on year). Sales of diesel oil accounted for the major share of revenue, and totalled PLN 18,890.6 million (57% of the Group's total revenue). In 2021, they increased 59.9% year on year. Sales of gasolines were also an important contributor to revenue, Amounting to PLN 4,603.7 million (13.9% of total revenue), i.e. 51.8% more year on year. In 2021, heavy products accounted for 4.5% of the LOTOS Group's revenue, or PLN 1,504.7 million (an increase of 24.5% on 2020).

In 2021, the share of domestic sales in the LOTOS Group's revenue went up. Revenue from domestic sales was PLN 28,293.0 million (85.4% of total revenue), having increased by 59.5% year on year.

Appendix to Resolution No. 291/XI/2022 of the Supervisory Board of Grupa LOTOS S.A. of May 19th 2022

Operating expenses

Operating expenses of the LOTOS Group in 2021 were PLN 28,784.1 million, or 34.7% more than in the previous year.

The main items of operating expenses were:

• Raw materials and consumables used - an increase of 54.9%, or PLN 8,490.3 million, year on year mainly due to the higher value of crude oil processed;
• Services - PLN 1,496.5 million (an increase of 4.4% on 2020). The increase was a result of, among other things, higher costs of financial services related to the increase in market prices and higher costs of service stations;
• Employee benefits expense - amounting to PLN 981.3 million (up by 4.5%);
• Depreciation and amortisation of PLN 1,049.0 million, 3.8% less than in 2020. This decrease was mainly attributable to the effect of the units-of-method estimates of production assets in Norway;
• Taxes and charges - of PLN 762.1 million, similar to the amount reported in 2020.

Net other income/(expenses)

In 2021, the LOTOS Group reported net other income of PLN 138.4 million, compared with net other expenses of PLN -929.8 million the year before. It was mainly an outcome of non-recurring events:

• Impairment losses on assets related to the Utgard field of PLN -39.2 million,
• Reversal of impairment losses on Heimdal assets in the Vale field of PLN +35.1 million,
• Impairment losses on assets in the Kamień Pomorski and Górowo Iłowieckie areas of PLN
  -0.6 million,
• Reversal of impairment losses on the B3 field assets of PLN +116.2 million,
• Reversal of impairment losses on the B8 field assets of PLN +135.0 million,
• Reversal of impairment losses on the Lithuanian assets of PLN +6.6 million,
• Reversal of impairment loss on ships at the Miliana Group of PLN +1.5 million,
• Impairment losses on assets subject to the remedies of PLN -127.0 million,
• Impairment losses of PLN -3.6 million on service stations.

LIFO-based EBITDA

Table 2.LIFO-based EBITDA (PLNm)

	2021	2020	Change 2021/2020
	(PLNm)	(%)
EBIT (1)	4,477.9	-1,396.8	5,874.7	-
Depreciation and amortisation (2)	1,049.0	1,089.9	-40.9	-3.8%
Effect of one-off items (3)	-45.3	923.6	-968.9	-104.9%