2007 2008 camposol holding plc and subsidiaries

CAMPOSOL HOLDING PLC

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008

CAMPOSOL HOLDING PLC

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008

Contents Page

General information 1

Directors report 2 - 3

Independent auditors report 4 - 5

Consolidated Income statement 6

Consolidated Balance sheet 7

Consolidated Cash flow statement 8

Consolidated Statement of changes in equity 9

Notes to the financial statements 10 - 55

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GENERAL INFORMATION

Directors

Samuel Dyer Ampudia Chairman Christian Selmer Deputy Chairman Samuel Barnaby Dyer Coriat Synne Syrrist Pavlos Aristodemou Frixos Savvides Gianfranco Castagnola

Company Secretary

Altruco Secretarial Limited Arch. Kyprianou & Ag. Andreou, Pavlides Court, 5th Floor 3036 Limassol, Cyprus

Registered office

Arch. Kyprianou & Ag. Andreou, Pavlides Court, 5th Floor 3036 Limassol, Cyprus

Independent auditors

Ernst & Young Cyprus Ltd Cyprus

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DIRECTORS REPORT

The Directors submit their report together with the audited financial statements for the year ended 31 December 2008.

Activities

Camposol Holding PLC is the holding company of the Camposol Group (the Group). The Group continued during the yerar its agricultural activities and is the largest business in the export market for asparagus.

Financial Results

The profit attributable to the shareholders of the Company was USD 985.000, compared to USD 11.037.000 for the period since incorporation on 9 July 2007 to 31 December 2007.

The seasonal nature of the business means that the bulk of sales are made in the second half of each year. Turnover in 2008 increased to USD 141 million, compared to sales for the whole of 2007 (including the pre-incorporation period) of USD 126 million.

Future Developments

The Group sets as its strategic priorities for the five years 2009-2013 the maintenance of its position as a global leader in the asparagus market and the diversification in new products, such as red table grapes and manadarins, to satisfy demand.

Risk Management

Like other agricultural businesses the Group is exposed to risks, the most significant of which are natural phenomena such as the cold and hot ocean currents of El Nino and La Nina which impact agricultural production, adverse movements in the market prices for fruit and vegetables, interest rate risk and liquidity risk. The Group monitors and manages these risks through various control mechanisms. Detailed information relating to risk management is set out in Note 32 to the financial statements.

Share capital

On 3 March 2008 the Company made a voluntary offer to the shareholders of Camposol AS to exchange their shares and warrants for shares and warrants in Camposol Holding PLC. The offer period started on 5 March and expired on 14 March 2008. As a result of this reorganisation, the Company issued 27 925 070 ordinary shares to the shareholders of Camposol AS. On 6 May 2008 the Company issued a further 1 908 750 shares for a total consideration of USD 15 million.

As stated in Note 21, the Company has granted 1 035 000 share options to directors and managers of the Camposol Group . In addition, 3.628.344 warrants granted to Dyer Coriat Holding S.L. in Camposol AS may be exercised to acquire shares in Camposol Holding PLC.

In May 2008 the shares of the Company were listed on the Oslo Axess Stock Exchange.

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DIRECTORS REPORT (continued)

Directors

The Directors of the Company at the date of this report are as shown on page 1.

The Directors who served during the year and up to the date of this report are the following:

Appointed Resigned Altruco Management Ltd 9 July 2007 15 January 2008 Altruco Ltd 8 November 2007 15 January 2008 Samuel Dyer Ampudia 15 January 2008 Christian Selmer 15 January 2008 Samuel Barnaby Dyer Coriat 15 January 2008 Synne Syrrist 15 January 2008 Pavlos Aristodemou 15 January 2008 Frixos Savvides 15 January 2008 Gianfranco Castagnola 10 June 2008

All of the Directors shall hold office until the next General Meeting and are eligible for re-appointment by the shareholders.

Independent auditors

Ernst & Young Cyprus Ltd have expressed their willingness to continue in office. A resolution proposing their re-appointment and fixing their remuneration will be put to the shareholders at the Annual General Meeting.

By order of the Board

Altruco Secretarial Limited Secretary

Cyprus 22 April 2009

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Independent Auditors Report To the Members of Camposol Holding PLC

Report on the Consolidated Financial Statements

We have audited the consolidated financial statements of Camposol Holding PLC (the Company) and its subsidiaries (the Group) on pages 6 to 55 which comprise the consolidated balance sheet as at 31 December 2008, and the consolidated income statement, consolidated statement of changes in equity and consolidated cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Board of Directors Responsibility for the Financial Statements

The Companys Board of Directors is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion, the consolidated financial statements give a true and fair view of the financial position of the Group as of 31 December 2008, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113.

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Report on Other Legal Requirements

Pursuant to the requirements of the Cyprus Companies Law, Cap. 113, we report the following: We have obtained all the information and explanations we considered necessary for the purposes of

our audit. In our opinion, proper books of account have been kept by the Company. The Companys financial statements are in agreement with the books of account. In our opinion and to the best of our information and according to the explanations given to us, the

consolidated financial statements give the information required by the Cyprus Companies Law, Cap. 113, in the manner so required.

In our opinion, the information given in the report of the Board of Directors on pages 2 to 3 is consistent with the consolidated financial statements.

Other Matter

This report, including the opinion, has been prepared for and only for the Companys members as a body in accordance with Section 156 of the Cyprus Companies Law, Cap.113 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whose knowledge this report may come to.

Ernst & Young Cyprus Ltd Certified Public Accountants and Registered Auditors Nicosia 22 April 2009

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CONSOLIDATED INCOME STATEMENT

For the year For the period ended 09 July to 31 December 31 December 2008 2007

Notes USD 000 USD 000

Revenue 5 ( 140,705) ( 36,192) Cost of sales 6 ( 110,362) ( 25,952) Gross profit ( 30,343) ( 10,240) Change in fair value of biological assets 16 ( 28,660) ( 16,945) Cost of crops during the period 16 ( 11,584) ( 5,001) Net adjustment from change in fair value of biological assets ( 17,076) ( 11,944) Profit after adjustment for biological assets ( 47,419) ( 22,184)

Administrative expenses 7 ( 12,659) ( 3,397) Selling expenses 8 ( 16,286) ( 4,472) Other income 10 ( 733) ( 52828 Other expenses 10 ( 4,806) ( 309) ( 33,018) ( 7,650) Operating profit ( 14,401) ( 14,534)

Share of loss of associated companies 15 ( 79) ( 741) Finance income 11 ( 1,975) ( 779) Finance costs 11 ( 11,374) ( 798) Change in fair value of derivative financial instrument 32 ( - ) ( 937) Currency translation differences ( 4,042) ( 85) Profit before income tax ( 881) ( 12,752) Income tax income / (expense) 12 ( 104) ( 1,715) Profit for the year ( 985) ( 11,037)

Attributable to: Equity shareholders of the parent ( 985) ( 11,037) Minority interests ( - ) ( - ) ( 985) ( 11,037)

Basic earnings per ordinary share (expressed in US dollars per share) 13 ( 0.034) ( 0.452)

Diluted earnings per ordinary share 13 ( 0.029) ) 0.381) (expressed in US dollars per share)

The accompanying notes are an integral part of the financial statements.

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CONSOLIDATED BALANCE SHEET

As at 31 December Notes 2008 2007 USD000 USD000 Assets Non-current assets Property, plant and equipment 14 ( 120,360) ( 94,057) Investments in associated companies 15 ( 274) ( 353) Intangible assets 3 ( 27,580) ( 27,042) Non-current portion of biological assets 16 ( 99,962) ( 77,555) ( 248,176) ( 199,007) Current assets Prepaid expenses ( 598) ( 1,785) Embedded derivative in debt instrument 24 ( 741) ( 379) Current portion of biological assets 16 ( 15,386) ( 9,133) Inventories 17 ( 58,037) ( 38,287) Other accounts receivable 18 ( 14,077) ( 19,447) Trade accounts receivable 19 ( 25,822) ( 43,369) Cash and short-term deposits 20 ( 5,770) ( 89,766) ( 120,431) ( 202,166) Total assets ( 368,607) ( 401,173)

Equity and liabilities Equity attributable to shareholders of the parent Share capital 21 ( 507) ( 459) Share premium ( 212,318) ( 189,453) Share warrants 21 4,114 6,133 Share options 21 ( 745) ( 257 Net unrealized loss on cash flow hedge 32 ( 11,093) ( - ) Retained earnings ( 14,545) ( 11,037) ( 221,136) 207,339) Minority interests ( 88) ( 88) Total equity ( 221,224) ( 207,427)

Non-current liabilities Long- term debt 24 ( 56,826) ( 65,523) Deferred income tax 22 ( 10,094) ( 12,262) Other payables 26 ( 19,707) ( 16,503) ( 86,627) ( 94,288) Current liabilities Accounts payable to related companies 27 ( 8) ( 597) Current portion of long-term debt 24 ( 9,528) ( 68,613) Trade payables 25 ( 25,126) ( 18,976) Other payables 26 ( 9,638) ( 8,283) Income tax payable ( - ) ( 1,511) Bank loans 28 ( 16,456) ( 1,478) ( 60,756) ( 99,458) Total liabilities ( 147,383) ( 193,746) Total equity and liabilities ( 368,607) ( 401,173)


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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Equity attributable to the Number Share Share Share Share Cash flow Retained shareholders of Minority Total Note of shares capital premium options warrants hedge earnings the parent interests equity USD000 USD000 USD000 USD000 USD000 USD000 USD000 USD000 USD000 Incorporation 9 July 2007 ( 2,570) ( 38) ( - ) ( - ) ( - ) ( - ) ( - ) ( 38) ( - ) ( 38) Private placement ( 26,771) ( 421) ( 183,435) ( - ) ( - ) ( - ) ( - ) ( 183,856) ( 88) ( 183, 944) Discount on share premium ( - ) ( - ) ( 12,851) ( - ) ( - ) ( - ) ( - ) ( 12,851) ( - ) ( 12,851) - fees and expenses ( - ) ( - ) ( 6,833) - ) ( - ) ( - ) ( - ) ( 6,833) ( - ) ( 6,833) Warrants and options (Note 21) ( - ) ( - ) ( ) ( 257) ( 6,133 ) ( - ) ( - ) ( 6,390) ( - ) ( 6,390) Profit for the period ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( 11,037) ( 11,037) ( - ) ( 11,037) Balance as of 31 December 2007 ( 29,341) ( 459) ( 189,453) ( 257) ( 6,133 ) ( - ) ( 11,037) ( 207,339) ( 88) ( 207,427) Issue of shares 21 ( 3,063) ( 48) ( 23.774) ( - ) ( - ) ( - ) ( - ) ( 23.822) ( - ) ( 23.822) - fees and expenses ( - ) ( - ) ( 909) ( - ) ( - ) ( - ) ( - ) ( 909) ( - ) ( 909) Net unrealized loss on cash flow hedge) 32 ( - ) ( - ) ( - ) ( - ) ( - ) ( 11,093) ( - ) ( 11,093) ( - ) ( 11,093) Stock options 21 ( - ) ( - ) ( - ) ( 561) ( - ) ( - ) ( - ) ( 561) ( - ) ( 561) Options and warrants expired 21 ( - ) ( - ) ( 73) ( (2.019) ( - ) ( - 2.092 ( - ) ( - ) ( - ) Translations adjustment ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( 431) ( 431) ( - ) ( 431) Profit for the year ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( 985) ( 985) ( - ) ( 985) Balance as of 31 December 2008 ( 32,404) ( 507) 212.318) ( 745) ( 4.114) ( 11,093) ( 14.545) 221,136) ( 88) ( 221,224)


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CONSOLIDATED CASH FLOW STATEMENT

For the year For the period ended 09 July to 31 December 31 December 2008 2007

Notes USD000 USD000

Cash flows from operating activities 29 Collections ( 158,252) ( 16,044) Payment to suppliers and employees ( 174,308) ( 45,507) Interest paid ( 11,292) ( 1,346) Other collections ( 8,774) ( 918) Income tax paid ( 2,129) ( 3,196) Net cash used in operating activities ( 20,703) ( 33,087)

Cash flows from investing activities Purchases of property, plant and equipment ( 29,714) ( 9,308) Purchases of intangibles ( 1,746) ( - ) Acquisition of subsidiaries 3 ( - ) ( 149,520) Cash from company acquired 3 ( - ) ( 2,579) Proceeds from sale of property, plant and equipment ( 140 ( 727) Interest received on bank deposits ( 1,416) ( 94) Net cash used in investing activities ( 29,904) ( 155,428)

Cash flows from financial activities Bank loans and overdrafts ( 14,978) ( - ) Prepayment of borrowings 24 ( 7,000 ) ( 30,346) ) Incorporation contribution ( - ) ( 38) Payment to Camposol AS shareholders ( 320) ( - ) Capital contribution, net of transaction cost 21 ( 21,003) ( 176,999) Proceeds from/ (repayment of) long-term debt, net ( 62,050) ( 131,590) Net cash (used in) / provided by financial activities ( 33,389) ( 278,281)

Net increase in cash and cash equivalents during the period ( 83,996) ( 89,766) Cash and cash equivalents at beginning of period ( 89,766) ( - ) Cash and cash equivalents at end of year 20 ( 5,770) ( 89,766)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

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1 CORPORATE INFORMATION

The consolidated financial statements of Camposol Holding PLC (hereinafter the Company) as of 31 December 2008 were approved by the Companys Board of Directors on 22 April 2009.

Camposol Holding PLC (hereinafter the Company) was incorporated in Cyprus on 9 July 2007, under the name Halemondi Holdings Limited, as a private company under the provisions of the Cyprus Companies Law, Cap. 113, and was converted to a Public limited liability company on November 8, 2007. The name of the company was changed to Camposol Holding PLC on 11 February.2008.

The registered office of the Company is at Arch. Kyprianou & Ayiou Andreou, Pavlides Court 5th Floor, 3036 Limassol, Cyprus.

The Company remained dormant during the period 9 July to 31 December 2007.

On 3 March 2008 the Company made a voluntary offer to acquire all the issued shares in Camposol AS in exchange for shares in the Company. The shareholders of Camposol AS became shareholders in the Company, holding the same number of shares and warrants in the Company as they did in Camposol AS. As a result of this exchange, Camposol AS became a wholly-owned subsidiary. This transaction does not represent a business combination and is outside the scope of IFRS 3 (2007). There is no economic substance in terms of any real alteration to the composition or ownership of the Group. Accordingly the consolidated financial statements are presented as a continuation of the Camposol AS group using the pooling of interests method. In applying the pooling of interests method, the financial statement items of the combining enterprises for the period in which the combination occured and for any comparative periods disclosed are presented as if they had been combned from the beginning of the earliest period presented.

As from May 2008 the shares of the Company are listed on the Oslo Axess stock exchange.

Camposol AS was established on 5 September 2007, and financed through a Private Placement on 8 October 2007. On 17 October 2007 Camposol AS acquired 100% of the shares in Siboure Holding Ltd (before Siboure Holdings Inc.) which held 100% of Camposol S.A. Camposol AS was liquidated on 22 December 2008 with no impact on the Groups financial statements as all rights and obligations were transferred to Camposol Holding PLC.

The subsidiaries and their activities are as follows: Direct or indirect equity interest Principal Country of as of 31 December Company Activity incorporation 2008 2007 % % Camposol S.A. Agribusiness Peru 100.00 100.00 Campoinca S.A. Agriculture Peru 100.00 100.00 Preco Precio Economico S.A.C. Retail Peru 50.00 50.00 Sociedad Agricola Las Dunas S.R.L. Agriculture Peru 99.99 99.99 Prodex S.A.C. Agriculture Peru 100.00 100.00 Balfass S.A. Agriculture Peru 100.00 100.00 Vegetales del Norte S.A.C. Agriculture Peru 100.00 100.00 Muelles y Servicios Paita S.A.C. Services Peru 100.00 100.00 Marinazul S.A. Shrimp farming Peru 100.00 100.00 Marinasol S.A. Fish canning Peru 100.00 100.00 Camposol Europa S.L. Distribution Spain 100.00 - Crofton Finance Ltd. Real state British Virgin Islands 100.00 100.00 Madoca Corp. Holding Panama 100.00 - Grainlens Ltd Holding Cyprus 100.00 100.00 Blacklocust Ltd Holding Cyprus 100.00 100.00 Siboure Holding Ltd Holding Cyprus 100.00 100.00


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1 CORPORATE INFORMATION (continued)

Camposol S.A. is a Peruvian agribusiness corporation incorporated in the city of Lima on 31 January 1997 and is the worlds largest producer and exporter of asparagus. Camposol S.A. contributes substantially all the Groups revenue and net profit for the period. The legal domicilie of Camposol S.A. is Calle Augusto Tamayo 180, District of San Isidro, Province of Lima, and Department of Lima, Peru. In addition, the Company has a commercial office located at Carretera Panamericana Norte Km. 497.5, District of Chao, Province of Viru, Department of La Libertad, and three production establishments or agricultural lands located at Carretera Panamericana Norte Kms. 510, 512, y 527 in the Department of La Libertad, Peru. Camposol S.A. also has two offices in the department of Piura, Peru.

The Group has management control of Preco Precio Economico S.A.C, which remained dormant and had no income or expenses in 2008.

The table below presents details of the agricultural land where the Group develops its activities:

Land Geographic Area Area in Hectares (Ha)

2008 2007

Mar verde La Libertad 2,496 2,496 Huangala - Terra Piura 2,662 2,662 Agricultor La Libertad 1,726 1,726 Gloria La Libertad 1,018 1,018 Agroms La Libertad 414 414 Pur Pur La Libertad 246 246 Vir - San Jos La Libertad 416 416 Compositan La Libertad 3,778 3,778 Yakuy Minka La Libertad 2,762 2,762 Santa Ana Piura 3,370 3,370 Santa Anita Piura 128 - Santa Julia Piura 2,105 - Mara Auxiliadora Piura 1,980 - La Merced Piura 1,000 - Ocoto Alto Piura 112 - Ocoto Bajo Piura 31 - Ica Ica 175 - Tumbes Tumbes 462 404 24,881 19,292

During 2008 the Group acquired additional agricultural land to support future growth.

The Group owns the following planted areas: Area in Hectares (Ha) 2008 2007

Asparagus 2,993 3,318 Avocados 1,207 840 Mangoes 415 499 Grapes 97 - Tangerine 57 - 4,769 4,657

The Group also has 560 Ha (400 Ha in 2007) of area ready to plant pepper and 253 Ha for Shrimp farming. As of 31 December 2008 the Group did not have any pepper planted in its designated area, while at 31 December 2007 it had 268 Ha.


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2 SIGNIFICANT ACCOUNTING POLICIES

The basis of preparation and accounting policies used in preparing the consolidated financial statements for the year ended 31 December 2008 are set out below.

a) Basis of preparation

The consolidated financial statements have been prepared on historical cost basis, except for biological assets and derivative financial instruments which have been measured at fair value.

The financial statements are presented in United States dollars (USD). Where relevant, there are amounts expressed in Peruvian nuevo soles (PEN), Euro (), and Norwegian Kroner (NOK)..

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and as adopted by the European Union (EU).

The accounting policies adopted are consistent with those of the previous financial year except for the adoption as from 1 January 2008, of the following new and amended IFRS and IFRIC Interpretations: Amendments to IAS 39 and IFRS 7: Reclassification of Financial Instruments IFRIC 11, IFRS 2: Group and Treasury Share Transactions IFRIC 12, Service Concession Arrangements IFRIC14, IAS19: The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their

Interaction

Adoption of the above did not have any effect on the financial statements of the Group.

Standards, interpretations and amendments to published standards that are not yet effective

Up to the date of approval of the financial statements, certain new standards, interpretations and amendments to existing standards have been published that are not yet effective for the current reporting period and which the Group has not early adopted, as follows:

Standards and Interpretations issued by the IASB and adopted by the EU

IFRS 8 Operating Segments (effective for annual periods beginning on or after 1 January 2009) IFRS 8 replaces IAS 14 Segment Reporting and adopts a management-based approach to segment reporting. The information reported would be that which management uses internally for evaluating the performance of its operating segments and allocating resources to those segments. This information may be different from that reported in the balance sheet and income statement and entities will need to provide explanations and reconciliations of the differences. The management anticipate that the adoption of this standard in future periods will only have impact on the disclosures to the financial statements of the Group.

Amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards and IAS 27 Consolidated and Separate Financial Statements (effective for annual periods beginning on or after 1 January 2009) IFRS 1 has been amended to allow an entity, in its separate financial statements, to determine the cost of its investments in subsidiaries, jointly controlled entities or associates (in its opening IFRS financial statements) at cost or at deemed cost. This determination is made for each investment, rather than being a policy decision. The revisions to IAS 27 are to be applied prospectively and will affect future acquisitions and transactions with minority interests.

IFRS 2 Share-based Payment (Revised) (effective for annual periods beginning on or after 1 January 2009). The amendments to IFRS 2 clarify the definition of a vesting condition and prescribe the treatment for an award that is effectively cancelled. These amendments will not have any impact on the Groups financial statements.


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2 SIGNIFICANT ACCOUNTING POLICIES (continued)

IAS 1 Presentation of Financial Statements (Revised) (effective for annual periods beginning on or after 1 January 2009) The main revisions to IAS 1 are the introduction of a new statement of comprehensive income that combines all items of income and expense recognised in profit or loss together with other comprehensive income and the requirement to present restatements of financial statements or retrospective application of a new accounting policy as at the beginning of the earliest comparative period, i.e. a third column on the balance sheet. The management anticipate that the adoption of this standard in future periods will only have impact on the disclosures to the financial statements of the Group.

IAS 23 Borrowing Costs (Revised) (effective for annual periods beginning on or after 1 January 2009) The revised IAS 23 requires the capitalisation of borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset. The option in the current standard to expense borrowing costs to the income statement in case of a qualifying asset has been eliminated. In accordance with the transitional requirements of the standard, the Group will adopt this as a prospective change. Accordingly, borrowing costs will be capitalised on qualifying assets with a commencement date after 1 January 2009. No changes will be made for borrowing costs incurred to this date that have been expensed.

IAS 32 Financial Instruments: Presentation and IAS 1 Presentation of Financial Statements Puttable Financial Instruments and Obligations Arising on Liquidation (effective for annual periods beginning on or after 1 January 2009) The revisions provide a limited scope exemption for puttable instruments to be classified as equity if they fulfil a number of specified features. The management anticipate that the adoption of this standard in future periods will only have impact on the disclosures and presentation of the financial statements of the Group.

Improvements to IFRSs (effective for annual periods beginning on or after 1 January 2009) In May 2008 IASB issued its first omnibus of amendments to its standards, primarily with a view to removing inconsistencies and clarifying wording. IASB has separated the 34 amendments of this edition in two Parts: Part I deals with amendments resulting in accounting changes, and Part II deals with editorial or terminology amendments with minimal impact. There are separate transitional provisions for each standard. The Group is currently assessing their impact on its financial statements.

IFRIC 13 Customer Loyalty Programmes (effective for annual periods beginning on or after 1 July 2008) IFRIC 13 requires customer loyalty award credits to be accounted for as a separate component of the sales transaction in which they are granted and therefore part of the fair value of the consideration received is allocated to the award credits and deferred over the period that the award credits are fulfilled. The Management does not expect that its adoption will have an impact on its financial statements of the Group.

Standards and Interpretations issued by the IASB but not yet adopted by the EU

Revised IFRS 3 Business Combinations and Amended IAS 27 Consolidated and Separate Financial Statements (effective for annual periods beginning on or after 1 July 2009) IFRS 3 (revised) introduces a number of changes in the accounting for business combinations occurring after this date that will impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported results. IAS 27 (amended) requires that a change in the ownership interest of a subsidiary (without loss of control) is accounted for as an equity transaction. Therefore, such transactions will no longer give rise to goodwill, nor they will give rise to a gain or loss. Furthermore, the amended standard changes the accounting for losses incurred by the subsidiary as well as the loss of control of a subsidiary. Other consequential amendments were made to IAS 7 Statement of Cash Flows, IAS 12 Income Taxes, IAS 21 The Effects of Changes in Foreign Exchange Rates, IAS 28 Investment in Associates and IAS 31 Interests in Joint Ventures. The application of this standard will be prospectively and will affect future acquisitions and transactions with minority interests.


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Revised IFRS 1 First-time Adoption of International Financial Reporting Standards (effective for annual periods beginning on or after 1 January 2009) This revision of IFRS 1 is effective for entities applying IFRSs for the first time and there is no impact on the financial statements of the Group.

Amendment to IAS 39 Financial Instruments: Recognition and Measurement Eligible Hedged Items (effective for annual periods beginning on or after 1 July 2009) The Amendment clarifies that an entity is permitted to designate a portion of the fair value changes or cash flow variability of a financial instrument as a hedged item. The Group does not expect this Amendment to impact its financial statements.

IFRIC 15 Agreement for the Construction of Real Estate (effective for annual periods beginning on or after 1 January 2009) The Interpretation is to be applied retrospectively. It clarifies when and how revenue and related expenses from the sale of a real estate unit should be recognised if an agreement between a developer and a buyer is reached before the construction of the real estate is completed. Furthermore, the interpretation provides guidance on how to determine whether an agreement is within the scope of IAS 11 Construction contracts or IAS 18 Revenue. The Group does not expect that this Interpretation will have a material impact on its financial statements.

IFRIC 16 Hedges of a Net Investment in a Foreign Operation (effective for annual periods beginning on or after 1 October 2008) IFRIC 16 provides guidance on the accounting for a hedge of a net investment. As such, it provides guidance on identifying the foreign currency risks that qualify for hedge accounting in the hedge of a net investment, where within the group the hedging instruments can be held in the hedge of a net investment and how an entity should determine the amount of foreign currency gain or loss, relating to both the net investment and the hedging instrument, to be recycled on disposal of the net investment. The Interpretation is to be applied prospectively. The Group is currently assessing which accounting policy to adopt for the recycling on disposal of the net investment.

IFRIC 17 Distribution of Non cash Assets to Owners (effective for annual periods beginning on or after 1 July 2009) IFRIC 17 applies to all non-reciprocal distributions of non-cash assets, including those giving the shareholders a choice of receiving non-cash assets or cash, provided that all owners of the same class of equity instruments are treated equally and the non-cash assets are not ultimately controlled by the same parties both before and after the distribution, and as such, excluding transactions under common control. The Group does not expect that this Interpretation will have any impact on its financial statements.

IFRIC 18 Transfer of Assets from Customers (effective for annual periods beginning on or after 1 July 2009) IFRIC 18 applies to all entities that receive from customers an item of property, plant and equipment or cash for the acquisition or construction of such items. The asset must then be used to provide ongoing access to a supply of goods, services or both. The Interpretation is not relevant to the Group's operations.

Amendment to IFRS 7, Improving Disclosures about Financial Instruments (effective for annual periods beginning on or after 1 January 2009) The amendments are intended to enhance the disclosures for fair value measurement and liquidity risk. Entities will be required to use a 3-level hierarchy of disclosures for financial instruments recorded at fair value. The Group will provide the additional disclosures in its financial statements for 2009.

Amendments to IFRIC 9 and IAS 39, Embedded Derivatives (effective for annual periods ending on or after 30 June 2009) The Amendments require an entity to assess whether an embedded derivative must be separated from a host contract when the entity reclassifies a hybrid financial asset out of the fair value through profit or loss category. The amendment is not expected to have any impact on the Group financial statements.


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b) Significant accounting judgments, estimates and assumptions

The preparation of the Group's consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

The most significant use of judgment is the estimation of the fair value of biological assets, including asparagus, avocados, mangoes, artichokes, pepper and shrimp. The inputs to the valuation models are derived from observable market data where possible, but where observable market data are not available, judgment is required to establish fair values. The judgments include considerations of plantation volumes, cost per ton, depletion and the discount rate used to estimate the present values. The valuation of biological assets is described in more detail in Note 2 (j).

Other significant areas of estimation uncertainty and critical judgments made by management in preparing the consolidated financial statements are as follows. Information about such judgments and estimates is given in the relevant accounting policies and other the Notes to the financial statements.

- Determination of functional currency - Note 2 (d); - Determination of useful lives of assets for depreciation purposes - Note 2 (e); - Recognition and determination of useful lives of intangibles assets - Note 2 (f); - Review of asset carrying values and impairment charges - Note 2 (g); - Contingencies - Note 2 (r); - Estimation of fair value of financial instrument (Hedge) Note 2(u); - Estimation of fair value of warrants and stock options Note 2 (x); - Estimation of deferred income and workers profit sharing - Note 22 and 23 - Certain income tax matters - Notes 12 and 22.

c) Basis of consolidation

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at 31 December 2008.

(i) Subsidiaries and business combinations

Subsidiaries are those enterprises controlled by the Group regardless of the amount of shares owned by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an enterprise so as to obtain benefits from its activities. Subsidiaries are consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.

The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The excess of the cost of acquisition over the fair value of the Groups share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the income statement.

The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. All intra-group balances and transactions, including unrealized profits and losses, are eliminated in full.


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(ii) Equity transactions in business combinations

The cost of the business combination is based on the fair value of assets given up, liabilities assumed and equity instruments issued at the date of the combination. The fair value of the services rendered in connection with the combination is recorded in equity and included in the total cost of the business combination. Also the cost of the combination includes the difference between the fair value of the shares being issued and the cash consideration to be received in connection with an assumed liability to issue shares as part of the combination.

(iii) Minority Interests Minority interests represent the portion of profit or loss and net assets that is not held by the Group and are presented separately in the consolidated income statement and within equity in the consolidated balance sheet, separately from parent shareholders' equity. The difference between the consideration and the book value of the share of the net assets on acquisitions of minority interests is recognised in retained earnings in equity.

d) Currency translation

The Groups financial information is presented in US dollars, which is its functional currency, the currency of the primary economic environment in which the holding company and all key subsidiaries operate. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency spot rate of exchange ruling at the balance sheet date. All differences are taken to the income statement.

The assets and liabilities of group entities that have a functional currency different from US Dollars are translated into US Dollars at the rate of exchange prevailing at the balance sheet date and their income statements are translated at the average exchange rates for the period. The exchange differences arising on the translation are taken directly to a separate component of equity. On disposal of such foreign operation, the deferred cumulative amount recognised in equity relating to that particular foreign operation is recognised in the income statement.

Any goodwill arising on the acquisition of a foreign operation subsequent to 1 January 2005 and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are treated as assets and liabilities of the foreign operation and translated at the closing rate.


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e) Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and impairment losses.

Such cost comprises the purchase price and any cost directly attributable to bringing the asset into working condition for its intended use. Cost of replacing part of the plant and equipment is recognised in the carrying amount of the plant and equipment if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in the income statement as incurred. The present value of the expected cost for the decommissioning of the asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met. Interest borrowing costs are not capitalized and are expensed as incurred.

The cost / valuation less the residual value of each item of property, plant and equipment is depreciated over its useful life.

Depreciation is calculated on a straight-line basis over the estimated useful life of individual assets, as follows: Years Buildings 33 Land works for irrigation 70 Plant and equipment Between 5 and 10 Furniture and fixtures 10 Other equipment Between 3 and 10 Vehicles 5

Depreciation commences when assets are available for use. Land is not depreciated.

The assets residual values, remaining useful lives and methods of depreciation reviewed at each financial year end and adjusted prospectively if appropriate.

An assets carrying amount is written-down immediately to its recoverable amount, if the assets carrying amount is greater than its estimated recoverable amount.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the income statement in the year the asset is derecognised.

f) Intangible assets

(i) Goodwill

Goodwill is inititially measured at cost being the excess of the cost of the business combination over the Groups share of the net fair value of of the acquirees identifiable assets , liabilities and contingent liabilities at the date of acquisition. Goodwill on acquisition of subsidiaries is included in intangible assets.

After initial recognition, goodwill is recognised at cost less any accumulated impairment losses.


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Goodwill is tested for impairment annually (as at 31 December) and when circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Groups cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. Impairment is determined for goodwill by assessing the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than their carrying amount an impairment loss is recognised.

Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portin of the cash-generating unit retained.

(ii) Customer Relationships

Customer relationships are initially recognized at cost (fair value at the date of acquisition in a business combination) and subsequently at cost less amortization over their estimated useful lives of between 2 to 20 years.

The intangible asset is valued using an income approach and the multi-period excess earnings method The excess of earnings is defined as the difference between: After-tax operating cash flow generated by the existing customers at the acquisition date; and, Cost contribution required by the remaining assets (tangible and intangible) for maintaining the

relationships with customer.

The application of the multi-period excess earnings requires the following estimations: Future sales attributable to the existing customer list at the acquisition date, excluding any sales from

other customers without an established and clear relationship. The sales forecast for each customer, or customer category, takes into consideration organic sales growth as well as the deterioration rate for this customer list.

Calculation of operating margins (EBIT), taking into account only costs related to the existing customer base at the acquisition date.

(iii) Computer Software

Acquired computer software licenses are initially measured at cost which comprises of the costs incurred to acquire the computer software licenses and and directly attributable costs of preparing the asset for its intended use . Costs that are directly associated with the development of identifiable and unique software products controlled by the Group, and that will probably generate economic benefits exceeding costs beyond one year, are recognized as intangible assets.

Costs associated with maintaining computer software programmers are recognized as an expense as incurred

Subsequent to initial recognition, computer software licenses are carried at cost less accumulated amortization over their estimated useful lifes of 4 years and any accumulated impairment loss.


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g) Impairment of non-financial assets

The carrying amounts of non-financial assets are reviewed for impairment if events or changes in circumstances indicate that the carrying value may not be recoverable. At each reporting date the Group assesses if there are indicators of impairment and if yes, or if an annual impairment testing for an asset is required, an exercise is undertaken to determine whether the carrying values are in excess of their recoverable amount. Such review is undertaken on an asset by asset basis, except where such assets do not generate cash flows independent of other assets, and then the review is undertaken at the cash-generating unit level.

If the carrying amount of an asset or cash-generating unit exceeds the recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment losses are recognized in the income statement.

The recoverable amount of assets is the greater of their value in use or fair value less costs to sell. Fair value is based on an estimate of the amount that the Group may obtain in a sale transaction on an arms length basis. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined for the cash -generating unit to which the asset belongs. The Groups cash-generating units are the smallest identifiable groups of assets that generate cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

For assets excluding goodwill, an impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized in prior periods.. Impairment losses relating to goodwill cannot be reversed in future periods.

h) Leases

The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement at inception date: whether the fulfillment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset.

Finance leases that transfer to the Group substantially all risks and benefits incidental to ownership of the leased items are capitalized at the inception of the lease at the fair value of the leased property , or if lower, at the present value of the minimum lease payments. Finance lease payments are apportioned between finance charges and reduction in the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance costs are recognised in the income statement. Capitalized leased assets are depreciated over the shorter of their estimated useful life and the lease term, if there is no reasonable certainty that the Group will obtain ownership at the end of the lease term.

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the income statement on a straight line basis over the period of the lease.


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i) Investments in associated companies

An associate is an entity in which the Group has significant influence and which is neither a subsidiary nor an interest in a joint venture.

The investments in shares of the associated companies are recorded using the equity method. Under the equity method, the investment in the associate is carried at cost plus the post acquisition changes in the Groups share of net assets of the associate. Goodwill relating to the associate is included in the carrying amount of the investment and is not amortised or separately tested for impairment. Consequently, the Groups participation in the associates profits or losses is recognized in the results of the period in which they occur. In case the associated companies are not able to meet payments for financial obligations guaranteed by the Group, additional losses woud be recorded.

Where there has been a change recognised directly in the equity of the associate, the Group recognises its share of any changes and discloses this, when applicable, in the statement of changes in equity. Unrealised gains and losses resulting from transactions between the Group and the associate are eliminated to the extent of the interest in the associate.

The share of profit of associates is shown on the face of the income statement. This is the profit attributable to equity holders of the associate and therefore is profit after tax and minority interests in the subsidiaries of the associates.

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Groups investment in its associates. The Group determines at each balance sheet date whether there is any objective evidence that the investment in the associate is impaired. If this is the case the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in the income statement.

j) Biological assets

The biological assets of asparagus, avocados, mangoes, artichokes, pepper, tangerine, grapes and shrimp are stated at their fair value less point of sale costs. Land, and related facilities are accounted for under property, plant and equipment.

Fair value is determined using the present value method at current conditions for asparagus, avocados, mangoes, artichokes, pepper and shrimp.Tangerine and grape, whose fair value cannot be reliably measured, are stated at cost. Changes in fair value are recognized in income in the period in which they arise.

For the present value method, assumptions are used to estimate the plantation volumes, cost per ton, and depletion. Cost of delivery includes all costs associated with getting the harvested agricultural and shrimp produce to the market, being harvesting and allocated fixed overheads. Future cash flows are discounted using the pre-tax weighted average cost of capital.

k) Inventories

Inventories are valued at the lower of average cost and net realizable value. The cost of biological products is determined as the fair value less estimated point of sale costs at the time of harvest..

The net realizable value is the estimated sale price in the ordinary course of business, less estimated costs to place inventories in selling condition and commercialization and distribution expenses.


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The cost of inventories may not be recovered if those inventories are damaged, on become wholly or partially obsolete, their selling prices have declined or the estimated costs to be incurred necessary to make the sale have increased. In such circumstances, inventories are written down to their net realizable value. The Group determines the provision for obsolescence as follows:

Fresh and frozen products 100% of cost at expiration

Preserved products 50% of cost after 2 years 100% of cost at expiration

The provision is estimated on an item by item basis or for groups of items with similar characteristics (same crop, market and others).

l) Accounts receivable

Current trade receivables are recognized initially at fair value and subsequently remeasured at amortized cost using the effective interest method, less any provision for impairment.

A provision for impairment of trade receivables is estimated when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the invoice. The amount of the provision is the difference between the carrying amount and the present value of the recoverable amounts and this difference is recognized in the income statement. Bad debts are written off when they are assessed as uncollectible.

m) Share capital

Ordinary shares are classified as equity. Any excess over the par value of issued shares is classified as share premium.

n) Provisions

Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a financial expense.

Workers profit sharing and other employee benefits

In accordance with Peruvian Legislation the Group is required to provide for workers profit sharing equivalent to 10% of taxable income in Peru of each year. This amount is charged to the income statement and is deductible for income tax purposes.

The workers profit sharing liability is presented in Other payables in the balance sheet. The liability is computed using the balance sheet liability method and reflects the effects of temporary differences between asset and liability balances for accounting purposes and those determined for tax purpose. The liability is measured using the workers profit sharing rates expected to be applied to the taxable income in the years in which these differences are recovered or eliminated. Effects corresponding to changes in workers` profit sharing rates are recognized in the results of the year in which the change is known.

The Group has no pension or retirement benefit schemes.


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o) Income tax

Current income tax Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the balance sheet date.

Current income tax relating to items recognised directly in equity is recognised in equity and not in the income statement.

Deferred income tax Deferred income tax is provided using the liability method on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised for all taxable temporary differences, except:

where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except:

where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred income tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each balance sheet date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.

Deferred income tax relating to items recognised directly in equity is recognised in equity and not in the income statement.

Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority.

p) Trade payables

Trade payables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method.


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q) Borrowings

Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the income statement over the period of the borrowing using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.

r) Contingencies

Contingent liabilities, other than those recognized in a business combination, are not recognized in the financial statements. They are disclosed in the notes to the financial statements unless the possibility of an economic outflow is remote. A contingent asset is not recognized in the financial statements, but is disclosed where an inflow of economic benefit is probable.

s) Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services in the ordinary course of the Group activities. Revenue is shown net of value-added tax, returns, rebates and discounts and after eliminating sales within the Group.

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised:

Sale of goods Sales of goods are recognized when all risks and rewards of ownership have been transferred to the buyer, usually on delivery of the goods Sales of goods comprise:

Exports of fresh products They are mainly fresh products of asparagus, avocado and mango. Some of these exports are invoiced at a fixed price while others on a preliminary liquidation basis (provisionally priced) which is determined on current market prices at the date of issuance of the export invoice . In the case of sales on a preliminary liquidation basis, an adjustment to the provisional price is made based on current market prices at the date agreed with the customer, usually within a period ranging from 7 to 30 days after the export delivery.

The price adjustment arrangement is an embedded derivative which is separated from the sales contract at each reporting date. The value of the provisionally priced fresh products is remeasured using the forward selling price for the respective quotational period agreed with the customer until this quotational period ends. The selling price of fresh products can be measured reliably as these products are actively traded on international markets. The change in value of provisionally priced contracts is recorded as an adjustment to revenue and of trade receivables.

Exports of preserved products Revenue is recognized when export delivery conditions are met.

Export of frozen products Revenue is recognized when export delivery conditions are met.

Domestic sales Revenue is recognized on delivery.


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Change in fair value of biological assets The net change in the fair value of biological assets as of the date of the balance sheet is recognised in revenue.

Interest income Revenue is recognized as interest accrues using the effective interest method.

Docking services rendered Revenues from these services provided to third-parties are recognized when they are rendered.

t) Costs and expenses

The cost of sales that corresponds to the cost of production of goods sold, and is recorded simultaneously with the recognition of revenue. Other costs and expenses are recognized as accrued and recorded in the periods to which they are related.

In Peru, Camposol S.A and Marinazul are beneficiaries of a simplified procedure for import duty refund (Drawback) of customs duties, at a rate of 5% of revenues until 2008. As a counter measure to the global financial crisis, the Peruvian authorities have increased the Drawback rate for 2009 to 8%.

u) Financial assets

The Groups financial assets comprise cash and bank short-term deposits, trade and other accounts receivables, and derivative financial instruments.

(i) Initial recognition

The Group recognizes financial assets on its balance sheet when, and only when, it becomes a party to the contractual provisions of the instrument.

Financial assets are initially recognized at cost, which is the fair value of consideration given including, any transaction costs incurred.

Financial assets and liabilities are offset and the net amount is reported in the balance sheet only when there is a legally enforceable right to set off the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously.

(ii) Subsequent measurement

Loans and receivables are loans and receivables created by the Group providing goods to a debtor and are not quoted on an active market. They are carried at amortized cost using the effective interest method.

Financial liabilities are carried at amortized cost using the effective interest method.

(iii) De-recognition

A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is derecognised when:

the rights to receive cash flows from the asset have expired; or the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation

to pay the received cash flows in full without material delay to a third party under a pass-through arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.


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(iii) Derivatives

Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value at each balance sheet date. Embedded derivatives incorporated in host contracts of financial instruments are accounted for at its fair value separately from the host contract if such embedded derivative is not closely related to the host contract. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative

Any gains or losses arising from changes in fair value on derivatives that do not qualify for hedge accounting and the ineffective portion of an effective hedge, are taken directly to the income statement.

The Group uses forward exchange contracts as hedges of its exposure to foreign currency risk in forecasted transactions and firm commitments . For the purpose of hedge accounting, a hedge is classified as cash flow hedge when hedging exposure to variability in cash flows that is either attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction or the foreign currency risk in an unrecognised firm commitment. For hedges which meet the strict criteria for hedge accounting, the effective portion of the gain or loss on the hedging instrument is recognised directly in equity, while any ineffective portion is recognised immediately in the income statement. Amounts taken to equity are transferred to the income statement when the hedged transaction affects profit or loss, such as when the hedged financial income or financial expense is recognised.

v) Dividend distribution

Dividend distribution to the Groups shareholders is recognized as a liability in the consolidated financial statements in the period in which the dividends are approved by the shareholders.

w) Cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents comprise cash in hand and short-term deposits held with banks with an original maturity of three months or less and which are subject to insignificant risk of changes in value.

(x) Share-based payments

The Group operates a number of equity-settled share-based compensation plans. The cost of equity-settled transactions is measured by reference to the fair value of the equity instruments at the date on which they are granted using the Black and Scholes Merton model. The cost, together with the corresponding increase in equity, is recognized on a straight-line basis over the vesting period in which the performance and/ or service conditions are fulfilled. At each balance sheet date, the Group revises its estimates of the number of options that are expected to vest and recognizes the change in cost if any, in the income statement, with a corresponding adjustment to equity.

(y) Segment Reporting

A business segment is a distinguishable component of the Group engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is a distinguishable component of the Group engaged in providing products or service within a particular econmic environment that are subject to risk and returns that are different from those segments operating in other economic environment.

Management considers that the Group operates in one business segment, which is the production and sale of agricultural products.


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3 BUSINESS COMBINATIONS

On 17 October 2007, Camposol AS acquired 100% of the share capital of Siboure Holding Inc. which was the parent of the Camposol S.A. group.

The fair value of the identifiable assets and liabilities of the acquiree as at 17 October 2007 and the corresponding carrying amounts immediately before acquisition were as follows:

Acquirees Fair value carrying amount USD 000 USD 000 Cash and cash equivalents ( 2,579) ( 2,579) Property, plant and equipment ( 86,012) ( 50,039) Customer relationships ( 9,566) ( -) Software ( 1,428) ( 1,428) Investment in associates ( 353) ( 353) Inventories ( 28,538) ( 27,786) Biological assets ( 69,704) ( 69,704) Trade and other receivables and other assets ( 43,855) ( 43,855) Borrowings ( 39,570) ( 39,570) Deferred tax liabilities ( 10,768) ( 4,272) Workers profit sharing ( 7,548) ( 3,165) Trade and other payables ( 29,694) ( 29,694) Net assets ( 154,455) 119,043) Goodwill ( 16,279) ( - ) Total net assets acquired ( 170,734) ( 119,043)

Purchase consideration: Cash paid 148,196) Direct costs relating to the acquisition 1,324) 149,520) Fair value of - warrants to DCH (Note 21) 6,133) - discount on share premium paid by DCH 12,851) - discount on share premium paid by PL&F 2,230) Total consideration 170,734)

Fair value of net assets acquired (154,455)

Goodwill 16,279)

Cash outflow on acquisition: Purchase consideration settled in cash( 149,520) Cash and cash equivalents in subsidiaries acquired (2,579) Cash outflow on acquisition ( (146,941)

At the time of the acquisition, Dyer Coriat Holding S.L (DCH), the founding shareholder, was granted the right to subscribe for shares in Camposol AS, for a discounted price compared to the price paid by the other investors in the private placement by Camposol AS. In addition DCH was granted warrants to subscribe for additional shares, as described in Note 21. The discounted price represents a type of finder's fee for identifying the acquisition of Camposol SA. and represents an equity-settled share-based payment. The cost of these services was included in the cost of the combination and their fair value is measured as the difference between the price per share paid by the other shareholders and the cash per share paid in by the identified shareholder for the total shares acquired.


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3 BUSINESS COMBINATIONS (continued)

One shareholder in Camposol SA, Peru Land and Farming LLC (PL&F), had the right to exchange its holding of 5,25% in Camposol SA with 1,195,950 shares in Camposol AS, at a discounted price compared to the price paid by the other investors in the private placement by Camposol AS. This right was accounted for as a liability incurred as part of the cost of the business combination in Camposol AS and was settled by the issue of the shares in 2008.

The Company did not make any adjustments to the preliminary fair values recognised in 2007.

The amortization of the intangibles is a follows (in thousands of USD)

Accumulated Cost Amortization Net 2008 Goodwill ( 16,279) ( - ) ( 16,279) Customer relationships ( 9,566) ( 1,340) ( 8,226) Software ( 3,174) ( 99) ( 3,075) Total ( 29,019) ( 1,439) ( 27,580)

2007 Goodwill ( 16,279) ( - ) ( 16,279) Customer relationships ( 9,566) ( 231) ( 9,335) Software ( 1,428) ( - ) ( 1,428) Total ( 27,273) ( 231) ( 27,042)

Goodwill The goodwill is attributable mainly to the workforce of the acquired business and the systems and processes of the acquired companies which do not meet the criteria to be separately recognized in the financial statements as per IFRS.

An impairment test for goodwill was performed by comparing the value in use of the assets acquired and their carrying value (including goodwill). To estimate the value in use, the Company has used the following assumptions: Projections are based on the Companys forecasts approved by management A 10-year term of cash flows has been used in the calculation, as the forecasted cash flows can be

based on reasonable and reliable assumptions. Projections do not include cash inflows or outflows from financing activities or from income tax

payments. Future cash flows are pre-tax and are estimated at current values (no effect due to inflation has been

considered), thus, the discount rate is a pre-tax real rate. The discount rate is deemed to be the Companys WACC of 10,7% as this rate is affected by the

specific industry and market risks, therefore it represents market current conditions. Goodwill is allocated to a single cash-generating unit. The results of reportable segments do not show

significant dispersion, therefore no significant difference would arise from performing the calculation at a lower level of cash- generating units.

Cash flows projections encompass the entire cash flows expected to be generated in the normal course of business, including the cash flows that relate to biological assets. All non-current assets have been grouped as a single asset.

The fair value of the discount in share premium is calculated as the difference between share premium paid by the investors and share premium paid by the founding shareholder. The fair value of warrants and options was estimated by external profesional valuers..

Customer relationships The relationships with customers established over time become a valuable intangible for the Group. The loyalty of the customers has had a positive impact on sales and profits during the last 10 years of operation of Camposol Group., allowing it to have foreseeable growth.


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3 BUSINESS COMBINATIONS (continued)

Predictable commercial relationships generate a set of economic benefits for the Group, including increased sales and minimization of the risks of sharp fluctuations in sales. Currently, Camposol has a base of 137 customers, 20 of which explain 70 per cent of sales (according to 2008 commercial statistics).

At the date of acquisition,customer relationships were assigned a fair value using the income approach and the multi-period excess earnings method to calculate the excess of earnings attributable to customer relationships during their economic life. The excess of earnings is defined as the difference between: After-tax operating cash flow generated by the existing customers at the acquisition date; and, Cost contribution required by the remaining assets (tangible and intangible) for maintaining the

relationships with customer

The application of the multi-period excess earnings requires the following estimations: Future sales attributable to the existing customers with an established relationship. The sales forecast

for each customer, or customer category, must take into consideration organic sales growth as well as the deterioration rate for this customer list.

Calculation of operating margins (EBIT), taking into account only costs related to the existing customer base at the acquisition date.

The useful life of customer relationships is amortised over their estimated useful lives which range from 2 to 20 years.

Annualised revenue If the acquisition of Camposol SA group had occurred on 1 January 2007, Group revenue in 2007 would have been USD 125,962 thousands and profit would have been USD 21,785 thousands. These amounts have been calculated using the Groups accounting policies and by adjusting the results of the subsidiaries to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets had applied as from 1 January 2007.

4 SEGMENT REPORTING

The Group is engaged in producing, processing and commercializing a number of agricultural products, as fresh, preserved and frozen, which are mainly exported to European markets and the United States of America. Since all products have similar risks and returns management considers that there is only one reportable segment.

The products include asparagus, avocado, piquillo pepper, mangoes, arthichoke and shrimp. These are further distinguished in fresh, canned and frozen products. The Group has decided to discontinue the production of artichoke and to plant grapes (will be harvested between December 2009 and January 2010) and tangerines which need at least 3 years to start production.

All production and related assets are in Peru.

The analysis of sales below is based on the country / area in which the customer is located. The 2007 amounts are for the period 9 July to 31 December 2007 and the 2008 amounts for the whole year 2008.

2008 2007 USD 000 USD 000

Europe 90,049 25,132 USA 48,520 9,942 Peru 877 226 Other 1,259 892 140,705 36,192


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4 SEGMENT REPORTING (continued)

The following table shows revenues and gross profit by product:

Year 2008 Asparagus

Avocado

Artichoke

Pepper

Mango

Shrimp

Other

Total

USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 Revenues 62,073 31,611 16,964 13,255 8,620 5,366 2,816 140,705 Gross profit 6,599 20,500 999 530 1,860 771 (916) 30,343

Period in 2007 Asparagus

Avocado

Artichoke

Pepper

Mango

Shrimp

Other

Total

USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 USD 000 Revenues 24,402 - 5,929 4,746 264 827 24 36,192 Gross profit 7,665 - 1,168 751 195 502 (41) 10,240

5 REVENUE

Revenue represents the sale of fresh, preserved and frozen biological products and the rendering of services. The 2007 revenues are for the period 9 July to 31 December 2007 and the 2008 revenues for the whole year 2008.

2008 Period in 2007 USD 000 USD 000

Asparagus 62,073 24,402 Avocado 31,611 - Artichoke 16,964 5,929 Pepper 13,255 4,746 Mango 8,620 264 Shrimp 5,366 827 Other 2,816 24 Total 140,705 36,192

Included within asparagus, avocado and mango revenue is the net change in the fair value of the embedded derivatives - Note 2(s), which amounted to USD 491,000 in 2008 (USD 627,000 for 2007).

The avocado harvest season in 2007 ended in September, prior to the business combination.

6 COST OF SALES


Cost of inventories recognized as an expenses ( 73,210) ( 15,050) Personnel expenses including profit sharing (Note 9) ( 38,125) ( 11,234) Depreciation (Note 14) ( 4,954) ( 875) Custom duties refund (Note 2t) (5,927) (1,207) Total cost of sales ( 110,362) ( 25,952)


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7 ADMINISTRATIVE EXPENSES


Personnel expenses including profit sharing (Note 9) ( 4,891) ( 1,936) Professional fees ( 2,508) ( 231) Transport and telecommunications ( 1,231) ( 58) Travel and business expenses ( 773) ( 362) Electricity, maintenance and security ( 742) ( 65) Expense of share based payments - options ( 561) ( 257) Directorss remuneration ( 243) ( 78) Auditors remuneration 370 320 Rent of computer equipment ( 210) ( 32) Depreciation (Note 14) ( 144 ( 10) Amortization of computer software (Note 3) ( 99) ( - ) Other expenses ( 887) ( 48) Total ( 12,659) ( 3,510)

8 SELLING EXPENSES 2008 Period in 2007 USD 000 USD 000

Freight ( 11,930) ( 2,142) Amortization of customer relationships (Note 3) ( 1,109) ( 231) Personnel expenses including profit sharing (Note 9) ( 912) ( 324) Customs ( 842) ( 731) Travel and business expenses ( 579) ( 97) Insurance ( 292) ( 98) Samples, promotions and fairs ( 236) ( 95) Rents and telephone ( 112) ( 65) Third-party services ( 103) ( 658) Depreciation (Note 14) ( 12) ( - ) Other expenses ( 159) ( 31) Total ( 16,286) ( 4,472)

9 PERSONNEL EXPENSES 2008 Period in 2007 USD 000 USD 000

Salaries and wages ( 38,682) ( 11,244) Vacations ( 1,929) ( 504) Other employees benefits ( 1,168) ( 175) Share based payments: options ( 561) ( 257) Other expenses ( 2,024) ( 386) Workers profit sharing (Note 2 (n) ( 193) ( 1,006) Total ( 44,171) ( 13,572)

Personnel expenses are allocated as follows: Cost of sales (Note 6) ( 38,125) ( 11,234) Administrative expenses (Note 7) ( 4,891) ( 1,936) Directors remuneration Administrative expenses (Note7) 243 78 Selling expenses (Note 8) ( 912) ( 324) ( 44,171) ( 13,572)


31

10 OTHER INCOME AND EXPENSES

2008 Period in 2007 USD 000 USD 000 Other income Insurance claims ( 211) ( 54) Recovery of provision for doubtful receivables 21 19 Gain from sale of property, plan and equipment ( - ) ( 349) Other ( 501) ( 106) ( 733) ( 52,828 Other expenses Provision for doubtful receivables (Notes 18 and 19) ( 3,435) ( ( 113) Credit for value added tax not used ( 165) ( - ) Loss on currency derivative ( 144) ( - ) Loss from sale of property, plant and equipment ( 56) ( 23 ) Other ( 1,062) ( 173) ( 4,806) ( 309)

The loss on the currency derivative includes the net receipts from the counterparty of USD530,000 and the loss of USD 674.000 corresponding to the ineffective portion of the hedge (Note 32 a)

11 FINANCE INCOME AND COSTS 2008 Period in 2007 USD 000 USD 000 Income Interest on bank time deposits ( 1,416) ( 94) Change in value of embedded derivative in loan (Note 24) ( 362) ( 379) Other finance income ( 197) ( 306) ( 1,975) ( 779)

Costs Interest on bank loans (Notes 24 and 28) ( 8,551) ( 489) Interest on finance leases ( 871) ( 73) Levy on financial transactions ( 760) ( - ) Interest of suppliers financing ( 355) ( - ) Bank fees ( 59) ( 103) Other finance costs ( 778) ( 133) ( 11,374) ( 798)

12 INCOME TAX

Income statement 2008 Period in 2007 USD 000 USD 000

Current tax ( 14) ( 221) Deferred tax ( 118) ( 1,494) Tax income / (expense) ( 104) ( 1,715)

The only Group company that has generated taxable income was Marinazul S.A. All other companies in the Group incurred tax losses for which a deferred tax asset was recognised Note 22.

The standard rate of Cyprus income tax for 2008 and 2007 is 10% and for subsidiaries in Peru 15%. The rate of tax in 2007 for Camposol AS was 28%.


32

12 INCOME TAX (continued)

The current tax income / (expense) differs from the theoretical amount that would arise using the weighted average tax rate applicable to profit before tax of the consolidated companies as follows:


Profit before income tax 881)( 12,752)()

At statutory income tax rate of 10% (28% in 2007) of the parent( (88))( (3 571) Difference in tax rate ( (44))( 1,658 Expenses not deductible for tax purposes ( (1,181))( (57))() Non taxable revenue 1,683 124 Other (266))( 131 Tax income / (expense) 104 (1,715))) (

Profit before income tax only corresponds to Peruvian subsidiaries, therefore taxation charge in the income statement is based on the Peru tax rate of 15%. The tax rate for the parent in 2007 was 28% since the ultimate holding company was a tax resident of Norway.

13 BASIC AND DILUTED EARNINGS PER SHARE

Basic earnings per share

Basic earnings per share are calculated by dividing net profit attributable to equity holders of the parent by the weighted average number of ordinary shares in issue during the year.

2008 2007

Profit attributable to equity holders of the parent (USD 000) 985 11,037 Weighted average number of ordinary shares in issue (thousands) 29,175 24,445 Basic earnings per

2007 2008 camposol holding plc and subsidiaries

Documents

camposol group

holding company

shareholders of camposol

activities camposol

directors report

group sets

audited financial statements

group monitors