REPORT AND ACCOUNTS 2010
LANDKOM.COM
LANDKOM INTERNATIONAL PLC, 11 HOPE STREET, DOUGLAS IM1 1AQ, ISLE OF MAN
TEL: +44 (0)20 3170 5681  EMAIL: INFO@LANDKOM.COM  INVESTORS@LANDKOM.COM
Landkom International Plc  Annual Report 2010 LANDKOM IS A SCALE PRODUCER OF
AGRICULTURAL CROPS FOR SUPPLY 
TO THE GLOBAL FOOD AND BIODIESEL
MARKETS. WE INTEND TO PROFITABLY 
USE WESTERN FARMING TECHNIQUES 
AND TECHNOLOGIES IN THE FERTILE 
LAND OF UKRAINE AND DELIVER RETURNS
TO SHAREHOLDERS WHILST ADHERING 
TO THE HIGHEST STANDARDS OF
CORPORATE GOVERNANCE.
01 HIGHLIGHTS
02 WHERE WE OPERATE
04 OUR BUSINESS
05 MARKET OVERVIEW
06 CHAIRMAN’S STATEMENT
08 CHIEF EXECUTIVE OFFICER’S REVIEW
12 CHIEF FINANCIAL OFFICER’S REVIEW
14 BOARD OF DIRECTORS
15 DIRECTORS’ REPORT
17 CORPORATE GOVERNANCE STATEMENT
19 REMUNERATION REPORT
22 STATEMENT OF DIRECTORS’ RESPONSIBILITIES
23 INDEPENDENT AUDITOR’S REPORT
24 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
25 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
26 CONSOLIDATED CASH FLOW STATEMENT
27 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
28 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
56 REGISTERED OFFICE AND ADVISORS
Landkom International Plc Annual Report 2010 HIGHLIGHTS
A SIGNIFICANT 
TURNAROUND
Turnaround well underway 
with demonstrable operating 
and financial improvements
First profitable crops delivered
Direct operating costs 
down 45% on average for
comparable crops
Improved performance
significantly reduced EBITDA loss 
to $4.4 million, despite weather
related losses (2009: loss $21.1m)
All land planned for spring
planting campaign prepared
in autumn
Total expected hectarage for
harvest in 201 1 continuing to 
grow – now approximately 
48,000 hectares (ha), 
up 38 per cent on 2010
Post period end 5,000 tonnes 
of rapeseed forward sold at 
75% premium to 2010
Post period-end finance facility of
$9m signed securing all working
capital needs to harvest 201 1
Spring infield operations underway
and making good progress
REVENUE ($m)
16.8 +15%
10 16.8
14.6 09
08
NET ASSETS ($m)
46.0 +8%
10 46.0
42.8 09
08
LAND HARVESTED (HA)
34,506 +19%
10 34,506
29,062
17,582
09
08
LAND LEASED (HA)
73,995 +0%
10 73,995
74,220
115,000
09
08
ARABLE EMPLOYEES (PER 1,000 HA)
14.1 -10%
10 14.1
15.8
24.1
09
08
AVERAGE OPERATING COSTS (PER HA)
541 -47%
10 541
1,017
1,257
09
08
Landkom International Plc  Annual Report 2010 1
10.6
76.1 2 Landkom International Plc Annual Report 2010
UKRAINE HAS LONG BEEN 
A MAJOR SUPPLIER OF
AGRICULTURAL PRODUCE 
OWING TO ITS DEEP, FERTILE, 
WELL DRAINED “BLACK EARTH”
SOIL. THE CLIMATE IN UKRAINE
OFFERS EXCELLENT TEMPERATURE
AND RAINFALL CHARACTERISTICS
WITH A TYPICALLY CONTINENTAL
CLIMATE OF LONG COLD WINTERS
FOLLOWED BY SHORT SPRINGS 
AND HOT SUMMERS WITH 
REGULAR RAINFALL.
OPERATIONS ARE SPLIT INTO 
THREE REGIONS: WESTERN,
SOUTHERN AND CENTRAL.
REGIONS ARE THEN SPLIT 
INTO OPERATING MODULES.
THIS OPERATING STRUCTURE
FACILITATES BOLT ON 
ACQUISITIONS AND ASSISTS
EFFICIENT INTEGRATION.
WHERE WE OPERATE
COVERING THE OBLASTS OF LVIV, TERNOPIL, RIVNE,
IVANO-FRANKIVSK, ZAKARPATTYA AND KHMELNYTSKYI.
The western region is centred around the Group’s former
headquarters in Lviv. This region typically has high levels of
precipitation which reduces the risk of winter kill over the cold
winter months through regular snow cover, and provides excellent
growing conditions in the summer especially for oil seeds through
rainfall combined with high temperatures. The majority of the
Group’s cultivated land is located in this region together with
the majority of its assets and infrastructure.
WESTERN REGION
73,995
hectares
TOTAL LAND AREA CONTROLLED BY LANDKOM
48,000
hectares
TOTAL LAND PLANTED WITH CROP*
* Assuming completion of expected spring cropping Landkom International Plc  Annual Report 2010 3
POLAND
ROMANIA
BELARUS
RUSSIA
FARMLAND LOCATED IN CRIMEA.
Very high levels of sunshine in the growing season mean crops
such as soya and sunflower are well suited. There is a long history
of irrigation in Crimea and the Group intends to utilise canal
access and refurbish existing frigate irrigation equipment before
committing to the investment of modern irrigation systems.
Landkom’s operations are located in two sites focused around
two operating former collective farms. This means that from a
logistical perspective operations are efficient with fields only a few
kilometres from the farm base and storage facilities. Owing to dry
weather at the time of harvest, drying is not required which adds
to the cost savings compared to other regions.
FARMLAND IN ZHYTOMYR OBLAST.
Vast expanses of land are available for profitable crop raising.
Field sizes are larger than in western Ukraine giving potential for
increased efficiencies. Rainfall is less than western Ukraine but
soil quality is excellent. The Group intends to focus maize
production in this area. Despite a large area under lease, 
the central region has the lowest level of cultivated land of
Landkom’s regions, which will change quickly. The Group
delivered excellent results on maize here in 2010.
SOUTHERN REGION CENTRAL REGION
WEST/CENTRAL UKRAINE
Increased snow cover in the
west helps protect less hardy
crops such as rapeseed over
the long cold winter
reducing the risk of winter kill. 
EAST AND SOUTH UKRAINE
Areas further east and south are
drier which eases weather risk in
the harvest period and reduces
harvesting costs but retain
higher risk of drought. 4 Landkom International Plc Annual Report 2010
LANDKOM BEGAN FARMING
IN UKRAINE IN 2007. 
IN 2010, THE GROUP
CULTIVATED OVER 39,000 HA
OF LAND PRODUCING OVER
96,000 TONNES OF CROPS.
TOTAL LAND HOLDINGS 
ARE 74,000 HA WHICH IT
INTENDS TO PUT FULLY 
INTO PRODUCTION.
THE UKRAINIAN MANAGEMENT TEAM WHICH WAS 
PUT IN PLACE IN 2009 HAS EFFECTED A SIGNIFICANT
TURN-AROUND, DRASTICALLY REDUCING COSTS 
AND INCREASING THE SCALE OF FARMING
OPERATIONS. IN 2010, EBITDA IS APPROACHING
BREAKEVEN, DESPITE THE IMPACT ON THE HARVEST 
OF EXCEPTIONAL RAINFALLS ON THE WEST OF THE
COUNTRY. LANDKOM HAS INVESTED HEAVILY IN
EQUIPMENT, IS NOW MANAGED LOCALLY BY AN
ENTIRELY UKRAINIAN MANAGEMENT TEAM AND 
IS WELL ESTABLISHED AS A PLATFORM FOR A
SIGNIFICANT AGRICULTURE BUSINESS.
ABOUT THE COMPANY
The Group’s current farming operations are located throughout
Ukraine and divided to 3 operational clusters: West, Centre and
South. The “black earth” land in Ukraine is among the most fertile
in the world. In 2010, the Group has cultivated 39,000 ha of land
producing over 96,000 tonnes of crops. In 2011 the Group intends
to harvest crops from approximately 48,000 ha of land.
Future demand for agricultural feedstocks looks strong with
increased demand from growing populations and increased
protein intake, combined with legislated demand for biodiesel
related feed-stocks. With its varied crop outputs, the Group is well
placed as a platform to take advantage of price rises occurring
from supply/demand imbalances.
The Group, with its land-bank of 74,000 ha, has the opportunity to
expand its low cost farming, competing favourably against other
farming regions. The Group leases its land under agricultural land
leases, as Ukraine currently has a moratorium in place preventing
the freehold sale of agricultural land. The Group’s land leases
extend on average to approximately 11 years and contain the
right to renew and the right to buy provisions at the end of the
lease period.
The Group uses modern equipment and farming practices to
deliver yields considerably above the Ukrainian historical
averages. Following a complete management team restructuring
undertaken in 2008 and 2009, in response to the rationalisation
strategy required in the face of the global credit crunch and
collapse in commodity prices, the new management team has
executed a strategy of operating a low cost, profitable and
scalable farming model.
In order to achieve its farming strategy, the Group has 
successfully implemented the following defined objectives:
n Maintain strong relationships with land owners and local
government
n Continue to reduce costs per hectare to best in class
n Maximise the proportion of cultivated land from its total 
land holding
n Develop and incentivise staff through modern remuneration
schemes and regular training
n Develop own drying and storage capability to enable 
greater control of the crop sales process
As part of its repositioning strategy, the new management team
has successfully ensured that the Group is well regarded by the
local communities and government in the regions it operates in, as
well as nationally. The Group is a major positive contributor to the
local Ukrainian economy, contributing to social welfare projects,
reinstating derelict land to farming and improving the quality of
existing farmland through sustainable agricultural practices.
OVERVIEW HISTORY
39,000
hectares
LAND AREA CULTIVATED BY LANDKOM IN 2010
96,000 
tonnes
OF CROPS PRODUCED IN 2010
74,000 
hectares
TOTAL LAND HOLDINGS
THE GROUP IS NOW A WELL ESTABLISHED UKRAINIAN PRODUCER
OF AGRICULTURAL COMMODITIES INCLUDING RAPESEED, WHEAT,
BARLEY, MAIZE, SOYBEAN AND SUNFLOWER. THESE COMMODITIES
ARE ADDRESSING THE GROWING DEMANDS OF THE GLOBAL
FOOD AND BIOFUEL MARKETS. Landkom International Plc  Annual Report 2010 5
DEMAND DRIVERS
Demand for crops is increasing for multiple reasons:
n Population increases: World population has increased over the
past 30 years and is forecast to continue to increase into the
future. Much of the world population increases are in the
world’s poorest countries. These countries will face increasing
pressure from their own populations for grain. They will turn to
grain exporting countries such as Ukraine to satisfy their
growing needs from their hungry populations. Given the higher
volatility of food prices, country stocks will be increased which
will maintain demand over the coming short to medium term
as stocks are built up.
n Increased competition from biofuel: Biofuels increase
competition for crops such as maize. In the US approximately
one third of maize grown is consumed by the biofuel industry.
This biofuel competition is likely to correlate strongly with the
price of oil.
n Increased meat and dairy production: As global populations
become more wealthy, consumption habits tend towards
increased consumption of meat and dairy. A good example is
that of China where annual meat consumption has risen from
20kg per capita to 50kg per capita between 1980 and 2007.
SUPPLY DRIVERS
Supply is becoming irrevocably more constrained:
n Limited opportunities for global planted hectares to increase:
Cities continue to grow and expand into surrounding country
areas. A majority of supply increases will need to come from
improved technology and yield rather than from increased
farmland.
n Water security: Water security will become an increasingly
important subject as rainfall becomes more volatile.
n Climate change: Climate change appears to be limiting
farming operations on previously fertile land through increased
desertification. Volatile weather conditions increase the risk of
crop failure which in turn discourages greater investment in
yield delivering fertilisers and chemicals.
n Working capital: Finally working capital is still a constraint on
the industry. A lack of working capital prevents investment in
equipment and input which in turn also restricts yield.
UKRAINIAN SITUATION
Ukraine has the largest amount of agricultural land in Europe with
almost 41m hectares capable of supporting commercial farming.
Over 79% of agricultural land (i.e., 32m ha) is used for crop
production. Of this total over 28m ha is owned by smallholders.
Almost 71% of Ukraine’s total surface area constitutes agricultural
land in contrast to 41% of total surface area in the EU. Ukraine’s
agricultural land area is almost 20% of the EU’s land area.
The agriculture sector in Ukraine has gone through a period of
considerable transition since the country achieved independence
in 1991, following the break-up of the Soviet Union. State and
collective farms were officially dismantled in 2000. Farm property
was divided among farm workers in the form of land shares and
the majority of the shareholders leased their land back to the
newly formed private agricultural associations. Over the
subsequent decade following independence, fertiliser use fell by
85% and grain production declined by 50%.
Fertile black earth soil is in limited supply globally. These soils
permit reduced fertiliser input applications for comparable yields
and give potential to deliver highly efficient farming operations.
Land and labour costs are materially lower in Ukraine than in other
regions within Europe. Given the prominence of agriculture within
the economy (approximately 18% of GDP), Ukraine can allocate a
significant portion of its crop to export markets which in turn
provides strong foreign currency generation. Ukraine is a member
of the World Trade Organisation which means it is not generally
permitted to impose export restrictions.
EQUIPMENT
The Group’s agricultural equipment fleet is predominantly western
manufactured allowing the application of best practice western
scale farming techniques into its operations. Tractors, of which the
Group has 87, are mainly John Deere and Massey Ferguson,
combines are a mix of John Deere, Massey Ferguson and Claas.
Current machinery gives the Group the ability to farm
approximately 50,000 ha.
Landkom has created a logistics business which serves Group
operations during peak times and outsourced to 3rd party clients
during the off season. The core of the fleet is 25 Freightliner trucks.
These are fitted with GPS tracking devices and are used to deliver
agricultural inputs to fields and to deliver harvested crops to
storage depots. The trucks have a wide variety of trailers ranging
from specialist grain transporting trailers to flatbed trailers used to
transport heavy equipment across the Group’s operations.
MARKET OVERVIEW
THE AGRICULTURE SECTOR DYNAMICS ARE WELL DOCUMENTED. THE SUPPLY/DEMAND
BALANCE FOR AGRICULTURAL COMMODITIES IS FRAGILE WHICH HAS CAUSED PRICE
INCREASES IN 2007 AND AGAIN PUSHED UP PRICES IN 2010 TO LEVELS WHICH MARKET
COMMENTATORS BELIEVE WILL BE SUSTAINABLE FOR SOME TIME. PRESSURE IS BEING
APPLIED FROM BOTH THE SUPPLY AND DEMAND SIDES. 6 Landkom International Plc Annual Report 2010
CHAIRMAN’S REPORT
STRATEGY OVERVIEW
The Group’s strategy remains to develop a substantial and
profitable enterprise using western farming techniques and
technologies in an underdeveloped part of Europe whilst aspiring
to the highest standards of corporate governance, with the
objective of becoming a profitable major agricultural commodity
producer for the global foodstuff and biofuel markets.
The fundamental drivers supporting the Group’s growth remain
unchanged. Long term demand for crops continues 
to increase largely as a result of global population growth and an
ever growing demand for protein food; while long term supplies of
food remain constrained through increased competition for land
with encroachment from cities and energy crops.
Ukrainian black earth is amongst the best in the world for arable
farming, permitting production costs to remain lower than in
neighbouring EU countries. The Group has a valuable land bank 
of approximately 74,000 hectares and it remains the Group’s goal
to plant as much of this land as possible and as profitably as
possible.
The global dynamics of the agriculture market place have
improved substantially over the last year. Crop prices have 
almost doubled and investor appetite has returned to Ukraine.
With improved efficiency of farming operations, costs have been
lowered to a level which will permit the Group to operate well,
even in a poor pricing environment and to deliver superior returns
in a strong pricing environment.
OPERATIONAL HIGHLIGHTS
Over the past 12 months Landkom has undergone an operational
turnaround. Changes have taken place to the structure of the
operations which are beginning to come through in improved
financial performance.
NEIL BALFOUR
THE STRATEGY
REMAINS TO BE 
A MAJOR SOFT
COMMODITY
PRODUCER FOR
THE FOOD AND
BIOFUEL MARKETS.
MANAGEMENT REPLACED 
THE BUSINESS IS NOW
MANAGED AND RUN BY
EXPERIENCED UKRAINIANS
FROM WITHIN THE LOCAL
AGRICULTURE SECTOR.
LOCAL OPERATIONS ARE RUN EXCLUSIVELY FROM
UKRAINE. FINANCIAL CONTROL IS MAINTAINED FROM AN
INTERNATIONAL FINANCE TEAM. THE PLC BOARD IS MADE
UP OF UKRAINIAN AND INTERNATIONAL MEMBERS. Landkom International Plc  Annual Report 2010 7
Adverse weather conditions in Ukraine were regularly in the news
during the course of the year. Severe droughts in Ukraine and
Russia were widely reported in the press. Less reported were the
heavy rains in the west of Ukraine during the harvest season which
significantly impacted the Group’s operations. Despite these
weather problems, harvested land grew by 19% to 34,506 ha. At
the same time operating costs per hectare, on a like for like basis,
fell by approximately 45%. During 2010, Landkom delivered its first
profitable crops, as a direct result of these operating cost savings.
Operations have continued successfully post the period end.
Winter planting was completed with 28,856 ha of winter crop
successfully planted. Of this, 12,862 was winter rape and 13,149
was winter wheat with the remainder being barley and rye.
The Group prepared an additional 18,800 ha of land for spring
201 1 planting. This will bring total planting to approximately 48,000 ha
for harvest in 2011. The 2011 spring crop planting covers a wider
range of crops to assist agronomic rotational requirements and
reduce crop risk. When added to the geographical diversification
between the three regions, weather and disease risk to the Group
is markedly reduced. Further expansion of the cropped land area
is likely to be focused on the central region further to balance the
Group’s geographical diversification.
FUNDRAISING
In November 2009, the Group raised $16.2 million to expand
cultivated hectarage and provide working capital. On 23 March
2011, the Group announced that it had signed a credit agreement
with Raifeissen Bank Aval for a $9 million facility which will be
drawn down to support general working capital needs and as
explained in the Chief Financial Officer’s Review, the Board
continues to manage cash flow carefully. Previously the Group
had no significant bank borrowings or debt facilities.
FINANCIAL RESULTS
Although the Group generated a small EBITDA loss of $4.4 million to
the year end 2010 as a result of late, weather related losses to the
crops in the western operational unit, the Board believes that, should
crop prices remain buoyant, positive EBITDA and net profit are
achievable for 201 1.
Some of the recent price rises in commodities have been locked
in by selling forward a portion of the expected rapeseed harvest.
Prices are attractive at $600 per tonne ex VAT on a CPT (“Carriage
Paid To”) basis. This price is approximately 75% higher than those
prices achieved in 2010 forward sales and 120% higher than
prices achieved in 2009 at the bottom of the market.
Costs on like-for-like crops, fell by an average of 45%. The Group
expects these cost reductions to be maintained in future periods
subject to material increases in the prices of fertiliser, fuel and
other inputs. The Group remains focussed on cash management,
cost control and gross margin maximisation.
BOARD AND MANAGEMENT
Following a period of significant change, the past 12 months 
have provided the Group with the opportunity to integrate the
new Ukrainian management team. Staff morale is high and
the difficult restructuring decisions have been taken swiftly 
and delivered upon. Vitaliy Skotsyk through his continued 
Non-Executive position with his former employer Amaco, has
delivered a close and important working relationship with the
Group’s principal trade supplier.
After the period end, Stephen Pickup CFO indicated his 
intention to step down from the Board and the company. 
John Mapplebeck (non-executive director) has agreed to
become CFO and relinquish his non-executive responsibilities.
Stephen will continue to support the business in the next months
as a corporate finance advisor to the Board.
OUTLOOK
Initial indications on the selling prices of the 2011 crops look
encouraging, backed up by the forward sales contracts on
rapeseed agreed during March 2011 at 75% higher levels than
2010 prices. As operating performance and cash generation
improve, the Group will have increased flexibility on the timing 
of crop sales.
The Board feels that the Group is now in its strongest position since
its IPO in 2007. Commodity prices are high and costs are under
control. The business remains highly operationally geared and is
well positioned to reap the financial benefits of a prolonged
period of positive pricing in the soft commodities market.
The Group continues to be presented with various opportunities 
for expansion but its immediate goal is to continue to plant as
much of the land bank as profitably possible and to deliver
positive EBITDA and net profits.
NEIL BALFOUR
CHAIRMAN
5 APRIL 2011 FOCUS HAS BEEN TO TURN
AROUND THE OPERATIONS
INTO AN EFFICIENTLY RUN
PROFESSIONAL FARMING
ENTERPRISE.
WE COMBINE BEST IN CLASS UKRAINIAN KNOWLEDGE
TOGETHER WITH THE HIGHEST STANDARDS OF
CORPORATE GOVERNANCE.
8 Landkom International Plc Annual Report 2010
CHIEF EXECUTIVE’S REPORT
Welcome to the fourth Annual Report of Landkom, which outlines
the progress made during 2010. Since joining the Group in
September 2009 and taking the role of Chief Executive Officer in
November 2009, my focus has been to turn around the operations
into an efficiently run professional farming enterprise combining
best in class Ukrainian know-how and state of the art western
farming technology together with the highest standards of
corporate governance through the International Board. I brought
many trusted colleagues from my previous projects, which has not
only facilitated restructuring but also helped to introduce and
incorporate company values.
Valuable assets of land, equipment and know-how exist in the
Group and with the correct leadership they can be combined to
produce a model agricultural business in Ukraine. The Group’s goal
is not to just deliver the highest yield, but to achieve the optimal
trade-off between cost and yield in order to maximise profit. The
Group is on course to deliver this objective in 201 1 by achieving
yield improvements whilst maintaining comparable costs.
LAND
Land is the key asset within the business. The Group’s Ukrainian
central management has been set up in Kiev to ensure that land
on all geographical regions of Ukraine obtain visibility and
maintain importance in the Group’s future plans.
The famous “black earth” soil which runs through the heart of
Ukraine is core to our operations. Having remained derelict for
much of the last 20 years, groups like Landkom are in the process
of revitalising it to its former prominence. Productivity will increase
year on year as the soil structure improves and nutrients are
improved through sustainable applications of inputs and informed
crop rotation.
THIS REPORT
OUTLINES THE
PROGRESS MADE
IN THE GROUP
DURING 2010. 
VITALIY SKOTSYK Landkom International Plc Annual Report 2010 9
Although the land bank has remained constant at approximately
74,000 ha, the Group has undertaken a considerable series of land
swaps which has changed the actual land held within the land
bank. Land currently in the land bank has either been farmed by
the Group or is in economically viable clusters which will permit
efficient farming in the short term.
Land acquisition costs are rising in Ukraine as the economy
improves and investment returns to the agriculture sector on the
back of increasing commodity prices. The Group estimates that
the value of the unused land bank amounts to around $5 million.
There is no recorded balance sheet value to the land bank given
that it is held through leases and the land acquisition costs have
been expensed in the first years of operations.
The moratorium on agricultural freehold land sales remains in
place although the Ukrainian government is formulating plans to
remove the restrictions and permit landowners to sell or mortgage
their land holdings which would provide a significant stimulus to
the economy. The Group continues to monitor the situation
carefully. The Group’s leases all contain last right of refusal to
purchase in the event that the moratorium is lifted. Typical new
leases with individuals have a 15 year “right to buy” provision.
Currently the Group has seven operating modules ranging from
7,000 to 12,000 ha. Five are in the western region with one in each
of the south and central regions.
STORAGE AND LOGISTICS
During the course of 2010, the Group’s rail-side storage facility in Lviv
Oblast has been significantly upgraded and has become fully
functional with all necessary state approvals. Its dryer and storage
was extensively used in 2010 for Landkom’s own production which
helped reduce costs.
The site is fully licensed with the State Agrarian Fund and has been
used throughout the winter storing third party grain and delivering
extra revenue. Construction of railway line has been completed and
the silo is now able to unload grain directly to railway cars. An extra
buffer zone was constructed thereby increasing handling capacity
by 500 tonnes per day.
A gas pipeline is in the process of construction with plans to connect
the dryer to gas in the first half 201 1 which will reduce the drying costs
significantly compared to the diesel used in the past.
The Group still plans to construct the second phase of the silo, which
was purchased in 2007/8, when resources become available to
finance the project. The Group’s medium term strategy remains to
have up to five silo facilities across the Group’s main areas of
operations. This will decrease costs and permit more flexibility and
control over the crop selling process. Until the medium term strategy
is executed, the Group will continue, when needed, to use good
relationships developed with local silo owners to ensure the harvest is
carefully handled post-harvest and pre sale.
The modular system has also helped to reduce logistics costs by
minimising the distance travelled by machinery to get to the fields.
Deliveries are made locally which reduces time to field and 
reduces the risk of missing weather windows for making specific 
field applications.
FARM BASES
Regional farm bases provide secure areas to store and monitor
crop inputs close to where they are required. Additionally they are
used to carry out repairs on agricultural equipment and to store
water and fuel. The Group has 18 bases around the country in
regions where it leases land. There is an ongoing process of base
refurbishment to improve the efficiency of the service they provide
to the operations where they are located.
AGRICULTURAL EQUIPMENT
During 2010 a certain element of new machinery was purchased
to meet the requirements of the additional spring crops cultivated.
Given the resurgence of lease financing in Ukraine, the Group
intends to resume capital expenditure to deliver the optimal fleet
to improve efficiency and minimise crop risk. Particular areas of
investment will be combine harvesters and self-propelled sprayers.
These are both areas where we believe we lost considerable
quantities of crop yield through an insufficient quantity of the
appropriate equipment.
Maintenance costs savings were among the greatest savings in
2010 falling by 70% on a per ha basis. This excellent result was in
part due to the Group’s maintenance being managed by an
appropriately incentivised Ukrainian workforce compared to the
expatriate team used in previous periods. Further savings were
also made through improved spare parts purchasing methods
along with internal procedures which assign responsibility for
individual pieces of machinery to specific operators who are
incentivised based on the condition of their equipment. This
scheme has caused the drop in the instances of breakdowns
and neglect of machinery. During the winter period of 2010/11
all machinery has been serviced, diagnosed and repaired to
ensure it is fully operational for the year ahead.
FARMING OPERATIONS
The Group’s farming operations remain focussed on efficiency
and margin. The Group’s immediate target is to raise the
proportion of land bank planted from an expected 65% this 
year to as close to 100% as is efficiently possible, without
sacrificing margin or farming quality.
HARVEST 2010
The Group harvested five main crops across its three regions
during 2010. The western operations produced all five crops
including rapeseed and wheat, the central operations focussed
on maize and the southern operations cultivated wheat, soya,
mustard and other minority crops.
During 2010, Landkom delivered its first profitable crops. Winter
crop losses in 2009/10 were minimal, against a backdrop of
widespread winter kill across Ukraine. However, heavy rains
throughout the spring and summer in the west hindered the
Group’s ability to apply some key inputs which unavoidably
reduced yields. The Group’s 2011 capital expenditure program has
been set to ensure that this risk will be minimised by providing the
farming team with the correct equipment to permit increased
farming days, even in periods of poor weather. 10 Landkom International Plc  Annual Report 2010
In 2010, for the first time, the Group planted and harvested its 
land in the central region with maize. At the same time, the 
crop rotation strategy was changed to incorporate a wider 
range of spring crops to decrease weather and commodity 
price risk. Spring crops in 2010 made up 46% of the total crop. The
Group intends to maintain this approximate level of spring crops in
the future.
The 2010 harvest demonstrates the operational progress that has
been achieved. Harvested land increased by 19% whilst costs per
ha on comparable crops were reduced on average by 45%.
These cost savings are likely to be maintained into the future,
assuming constant prices for the core inputs of fertilizer, chemicals
and seed.
Landkom’s tonnages relating to harvest are clean and dry 
ready for sale weights as certified by silos. Yields relate to 
certified tonnages collected off harvested ha (excluding lost, 
non-harvested ha). Yields across Ukraine fell in 2010 due to the 
wet weather in the west of Ukraine and the drought in the
remainder of the country. Landkom’s yield results are shown in 
the table opposite.
The western operations were most affected by the heavy rainfall
during spring and summer 2010. In aggregate 14% of crops were
lost and not harvested. Management regards the 2010 crop losses
as exceptional and does not expect such a scale of losses to be
replicated in future periods. Achieved yields are 11% – 48% higher
than average Ukrainian yields and we would hope and expect
2011 yields to be in excess of these levels.
We believe that the rapeseed harvest was impacted by the
limited owned combine resources. Unusual weather conditions in
the rest of the country meant that usual contract combine service
companies were unable to deliver on contract to harvest
Landkom fields causing in field losses. The Group intends to invest
further in combines to reduce this risk in future periods. Landkom
currently owns 21 combines.
STORAGE IS STRATEGIC FOR
MEDIUM-TERM GROWTH
THE GROUP’S RAIL-SIDE
FACILITY IN LVIV HAS BEEN
SIGNIFICANTLY UPGRADED
AND NOW HAS DIRECT RAIL
ACCESS.
THE MEDIUM TERM STRATEGY IS STILL TO HAVE UP TO 
FIVE STORAGE AND DRYING FACILITIES ACROSS THE
GROUP’S OPERATIONS.
CHIEF EXECUTIVE’S REPORT
CONTINUED Landkom International Plc  Annual Report 2010 11
WINTER PLANTING 2010
The autumn 2010 planting campaign was successfully completed
within the planting window. Winter crop planting was up 35% 
on 2009 to 28,856 ha. This crop was made up of 12,862 ha of
rapeseed, 13,149 ha of winter wheat, 292 ha of rye and 1,912 ha of
winter barley. The Group will report on how this crop has survived
the winter during April 2011. The winter crop has predominantly
been sown in the western and southern regions.
After the period end, a total of 18,800 ha were prepared for the
spring planting campaign. The Group expects final planting to
reach a total of approximately 48,000 ha which represents a rise 
of approximately 22% on 2009.
SPRING PLANTING 2011
Total spring planting is planned to reach approximately 19,000 ha.
This will be made up maize (43%), spring rapeseed (17%), spring
wheat (20%), soybean (5%) and sunflower (11%). As part of the
spring cropping, the Group plans to plant the entirety of its land
bank in the south which is among the Group’s most contiguous
and efficient farmland.
The 2011 spring crop planting covers a wide range of crops as an
intermediate step before the strategic four crop rotation system.
When added to the geographical diversification between the
three regions, the weather and disease risk to the Group is
markedly reduced. Further expansion of the cropped land area
is likely to be focused on the central region to further balance 
the Group’s geographical diversification.
LIVESTOCK
The Group’s livestock plans have been implemented during the
course of the year. Although currently not the focus of the Board,
livestock shows strong potential profitability when set up on a cost
efficient basis. With limited investment the Group’s livestock
operations have been restructured to improve efficiency and to at
least break even. The Group has two livestock operations in the
west and one in the south.
SALES
The selling process was completed efficiently with rapeseed
revenues required to finance the 2010 autumn planting season.
Other crops have been sold through the year, benefiting from
price rises over the past months. To date, all significant 2010
harvest inventory has now been sold.
Although cash flow requirements to cultivate efficiently the highest
possible proportion of existing land bank limited the Group’s ability
to retain crop in inventory for long periods, Landkom is seeking to
maximize sales proceeds within an approximate window of 6 - 8
months post-harvest.
IT
After the period end, the Group rolled out an online reporting
system developed to give senior management the highest level of
control across country-wide operations. Investment in this system is
expected to deliver further efficiency and assist and expedite
both operational and financial reporting in the future.
SECURITY
Given the widespread nature of operations and assets, strong
independent security is vital to the integrity of the business. In
addition to a small head office based security team, outsourced
contractors are used. Experience shows that outsourced security
alleviates the opportunity for employees to become too close to
security thereby reducing the risk of conflicts.
EMPLOYEES
At the period end, the Group had 717 employees. Of the 717
employees, 112 were employed in administration, 556 were
employed in arable operations and 49 were employed in
livestock. The Group’s employees are predominantly Ukrainian 
in its Ukrainian operations. Employees are incentivised and
responsible for their part of the business. Great care has been
taken to give budgetary responsibility to all areas of the business
and to ensure that all employees are incentivised to perform.
Equity ownership through the share option programme is likely 
to be expanded over the coming years.
VITALIY SKOTSYK
CHIEF EXECUTIVE OFFICER
5 APRIL 2010
AVERAGE AVERAGE
HA HA HA TONNES AVERAGE SALES PRICE REVENUE
PLANTED LOST HARVESTED PRODUCED YIELD (HARVESTED) PER TONNE $ PER HA $
Western
Rapeseed 15,136 521 14,615 36,872 2.5 328 827
Winter Wheat 4,005 727 3,278 9,882 3.0 171 513
Spring Wheat 3,522 725 2,797 8,478 3.0 171 517
Maize 6,085 2,032 4,053 19,300 4.8 156 744
Sunflower 2,985 636 2,349 3,558 1.5 450 681
Soybean 2,772 822 1,950 3,146 1.6 346 558
Central
Maize 2,000 0 2,000 10,927 5.5 156 853
2010 HARVEST RESULT 12 Landkom International Plc Annual Report 2010
In 2009, the financial reporting date was brought forward to 
31 October from 31 December in order to better match the
cropping cycle with the financial reporting cycle. The financial
results for 2009 were therefore based on a 10 month period. The
income statement continues to be presented before and after 
the biological asset fair value adjustment, to show the impact of 
these adjustments separately from direct farming costs.
Revenues for the 12 month period to 31 October 2010 were 
$16.8 million (10 months to 31 October 2009: $14.6 million). The
revenues were limited by the decision to delay the sale of some
crops until after the financial year end, in order to take advantage
of an improved pricing environment. Direct costs were sharply
reduced to $16.1 million (2009: $30.3 million). On a like-for-like per
hectare basis operating costs fell 45 per cent which is in excess of
targets set out 12 months ago of 35 per cent.
In addition, at the period end, the Group had harvested crop 
held for sale worth approximately $5.6 million which is recognised
as inventory on the balance sheet. Most crops have now been
sold in excess of the carrying value. The revenues from these sales
will be recognised in the 2011 financial statements.
Due to market conditions and realised yields, the fair value of
biological assets at the point of harvest remained above the
production cost resulting in a positive fair value adjustment.
Biological assets, planted in the autumn 2010, in the ground at 
31 October 2010 have been recognised at cost on the balance
sheet with no fair value gain or loss recognised in the income
statement.
Depreciation and amortisation was $7.3 million (2009 10 months:
$6.4 million). EBITDA losses, before exceptional items, were
substantially reduced to $4.4 million from $21.1 million. The EBITDA
neutral target was missed due to the unexpected crop losses as a
result of adverse weather conditions.
CHIEF FINANCIAL OFFICER’S REVIEW
THE GROUP HAS DEMONSTRATED
IMPROVED FINANCIAL
PERFORMANCE
LIKE FOR LIKE OPERATING COSTS
FELL 45%, AHEAD OF TARGETS
SET OUT 12 MONTHS AGO.
SG&A COSTS FELL 6% ON A 
PRO RATA BASIS.
GROUP’S FIRST BANK FACILITY
WAS SIGNED AFTER THE 
PERIOD END.
THE OPERATIONAL
TURNAROUND 
IS NOW SHOWING 
A POSITIVE IMPACT
ON THE FINANCIAL
RESULTS.
STEPHEN PICKUP Landkom International Plc Annual Report 2010 13
Administrative expenses, including share option plan charges,
were $4.9 million (2009: $4.4 million), which on a 10 month pro rata
basis reflects a reduction of 6%. Excluding share option charges,
administrative expenses were $4.3 million, a 9% reduction. These
reductions follow a reduction of 65% in the previous year and put
the Group at a competitive level for a listed entity.
The table below shows the costs for the 2009 and 2010 harvests
and exclude the Group’s southern operations which are currently
accounted for as an associate and are due to be fully
consolidated in 2011. Landkom expects to maintain comparable
input levels in the coming harvest which would mean the costs
savings will be maintained into the future in absence of significant
rises in input costs.
Cash control has remained extremely tight across the Group. The
highest levels of control remain in place to ensure cash is invested
in the areas which will deliver the highest return. Following the
placing in November 2009 which enabled the Group to increase
planting, Landkom has more flexibility to sell crops at optimal
times. Discretionary expenditure was limited to urgent farming
equipment and will increase over the coming years as the
Group’s planting expands and equipment becomes older.
At the period end, within the arable side of the business, following
the assumed spring planting, Landkom had 14.1 employees per
thousand hectares, down from 15.8 in 2009. Management intends
to further improve the ratio through planting additional land with
minimal additional staff.
The Group has now structured its domestic Ukrainian subsidiaries
to take advantage of the tax benefits which currently exist for
farming operations with regards to paying fixed agricultural tax.
This means that in future the Group’s tax burden relates to its land
bank rather than the profits delivered from operations. This is a
very favourable scheme. Ukrainian entities are also eligible for
Ukraine’s special agricultural VAT scheme which assists agricultural
producers by permitting them to retain the VAT on domestic sales
and reinvest the proceeds in agriculture related expenditure.
Before the exceptional items, pre-tax losses (excluding share
option charges) were $11.3 million (2009: loss $27.2 million).
In November 2009, the Group carried out a placing of new shares
for cash which raised gross proceeds $16.2 million for working
capital purposes.
Since the period end, the Group signed a credit agreement 
with Raifeissen Bank Aval for a $9 million facility. This facility will
ensure the Group has sufficient working capital through to the
2011 harvest. The business is highly dependent on cash generated 
from its annual harvest as well as trade and banking credit
facilities. Severe weather, credit restrictions or significant reductions
in agricultural commodity prices could present a material
uncertainty to the groups continued going concern status. Further
details of these uncertainties are outlined in note 2.1 of the
Financial Statements.
Biological assets are increased compared to 2009 due to the
increased planting. Inventories are increased to $9.9 million 
(2009: $5.2 million) mostly reflecting the additional harvested crop
held for sale.
At the period end, the Group had cash of $2.3 million. Due to
increasing commodity prices, the Group’s policy through the year
has been to maintain crop in inventory and to sell it for cash only
when funds are required for operations.
At the period end, the Group had no material finance lease
liabilities, although trade payables were temporarily high at 
$13.2 million. These payables were partially paid down by the sale
of crop inventories post period end and will be further paid down
with some of the proceeds of the Raifeissen facility.
As and when appropriate, the Board uses financial instruments
such as forward off-take contracts or financial derivatives to
hedge commodity prices. The purpose of the Group’s hedging
strategy is to hedge and reduce business risk rather than to
speculate. Due to local legislation, the Group continues to be
unable to hedge against the Ukrainian Hryvnya, although over the
period, stability returned to the US$ UAH exchange rate stabilising
at around 8 UAH to 1 US$.
STEPHEN PICKUP
CHIEF FINANCIAL OFFICER
5 APRIL 2011
RAPESEED WHEAT RAPESEED WHEAT MAIZE SOYA WHEAT SUNFLOWER
2009 2009 2010 2010 2010 2010 2010 2010
Number of hectares (planted) 14,630 11,444 15,136 4,005 8,085 2,772 3,522 2,985
Seed chemical and fertiliser 621 435 351 206 232 245 203 171
Fuel 91 70 75 53 48 45 48 50
Labour 169 120 58 44 53 45 46 53
Harvest/logistics 65 62 78 40 116 12 79 61
Maintenance 134 95 36 29 24 21 21 24
Land 26 26 33 33 35 35 35 35
Other 47 34 19 19 19 12 11 20
Cost per ha (planted land) 1,153 842 650 424 527 415 443 414
Cost per ha (harvested land) 1,153 842 653 433 566 420 464 430
COST PER HECTARE COMPARISONS 14 Landkom International Plc  Annual Report 2010
BOARD OF DIRECTORS
1 2
3 4
5
1 NEIL BALFOUR NON-EXECUTIVE CHAIRMAN, AGED 66
Mr Balfour is an Oxford MA, Barrister at Law and a former 
member of the European Parliament (1979–84). His early career
was in merchant banking at Baring Brothers & Co. (1969–74) 
and European Banking Company Ltd (1974–83) where his
responsibilities were in international corporate governance. Since
1990 Mr Balfour has concentrated his activities in central Europe
particularly in Poland, having created a number of funds in the
fields of private equity, privatisation and property. He created and
served as Chairman of KP Konsorcjum, the manager of one of 
the most successful of Poland’s 15 National Investment Funds.
2 VITALIY SKOTSYK CHIEF EXECUTIVE OFFICER, AGED 39
Mr Skotsyk, a Ukrainian citizen, has valuable local and
international experience in the agricultural sector, having built up
and led AMACO, one of the largest agricultural equipment and
input suppliers in the CIS over the past twelve years. He has a
PhD in Agriculture from the Ukraine State Agriculture University, 
a Doctorate of Economics in Strategic Management from
the International Management University, Kiev, and has worked 
in key positions in agricultural businesses in the UK and USA.
3 STEPHEN PICKUP CHIEF FINANCIAL OFFICER, AGED 36
Mr Pickup has ten years of experience in investment banking 
and company management, including five years in mergers 
and acquisitions at Deutsche Bank in London and Hong Kong. 
He has lived and worked in emerging markets for much of the 
last 15 years and splits his time between the UK and Ukraine. 
Mr. Pickup holds an MBA from INSEAD and speaks Russian,
Chinese and French. He was appointed to the Board in
September 2008.
4 TOM MORRISON NON-EXECUTIVE DIRECTOR, AGED 64
Mr Morrison holds an MA in Agriculture from Cambridge University,
and has over 35 years’ experience working in agriculture, food
security and rural development economics. He also has significant
investment experience in Eastern European farming. He was
appointed to the Board in 2010.
5 JOHN MAPPLEBECK NON-EXECUTIVE DIRECTOR, AGED 67
Mr Mapplebeck has extensive financial and banking experience,
both in the UK and internationally. He was previously Global Head
of Project Finance at Natwest Group and was also non-executive
director of JKX Oil & Gas Plc (with principal assets in Ukraine), as
well as Chairman of two private energy companies. He was
appointed to the Board in 2010. Landkom International Plc  Annual Report 2010 15
The Directors submit their report and the consolidated financial
statements of Landkom International Plc for the year from 1
November 2009 to 31 October 2010.
Landkom International Plc is a public listed company,
incorporated and domiciled in the Isle of Man and quoted on
AIM.
PRINCIPAL ACTIVITIES
The principal activity during the year was the cultivation and
distribution of arable crops for the biofuel and food markets.
RESULTS
The Group’s loss for the year after taxation was $11,847,000
(2009: $42,126,000).
DIVIDEND
The Directors do not recommend payment of a dividend.
BUSINESS REVIEW AND FUTURE DEVELOPMENTS
This is discussed in the Chairman’s statement and Chief Executive
Officer’s review.
DIRECTORS
The following Directors have held office since 1 November 2009:
DATE OF APPOINTMENT
Vitaliy Skotsyk
Stephen Pickup*
Neil Balfour
Gerald Howarth (resigned 14 April 2010)
John Mapplebeck 6 January 2010
Tom Morrison 6 January 2010
Ben Adams (resigned 6 January 2010)
Laurence Holyoake (resigned 6 January 2010)
* Stephen Pickup notified the Company on 24 January 2011 of his
intention to resign from the board. This is expected to take place in
April 2011.
SHARE CAPITAL
Full details of the available for issue and issued share capital of
the Company, including movements in the year, are set out in
note 20 to the financial statements. The ordinary issued shares of
Landkom International Plc were increased by 195,000,000 ordinary
shares in November 2009. The additional shares were issued by
way of a placing at 5p per ordinary share.
SUBSTANTIAL SHAREHOLDINGS
At 17 February 2011 the Company had been notified of the
following interests amounting to 3% or more of the Company’s
issued share capital:
Hunter Hall Investment Management Ltd 18.3%
Invesco Asset Management 16.7%
Kairos Investment Management 6.9%
Odey Asset Management LLP 5.4%
Rennaisance Capital Limited 4.7%
Arc Asset Management Limited 4.7%
UBS Ag 4.6%
Spearpoint 3.7%
EMPLOYEES
The Group’s employees are its most important asset. Our policy 
is to employ the best people, irrespective of race, gender,
nationality, disability or sexual preferences. Consultation with
employees or their representatives occurs at all levels, with the 
aim of ensuring their views are taken into account when decisions
are made that are likely to affect their interests.
FINANCIAL RISK MANAGEMENT
Information in respect of the financial risk management objectives
and policies of the Group and the exposure of the Group to
market risk, credit risk, liquidity risk and cash flow risk is contained
in note 4 to the financial statements.
In preparing the financial statements the Directors have assessed
the political and economic risk of operating within Ukraine and 
its possible impact on the operations and financial position of 
the Group.
DISABLED EMPLOYEES
Applications for employment by disabled persons are given full
and fair consideration for all vacancies, having regard to their
particular aptitudes and abilities. In the event that an employee
becomes disabled, every effort is made to retrain them in order
that their employment with the Group may continue. Landkom
employs a number of disabled persons in Ukraine in compliance
with Ukraine employment regulations. On 31 October 2010 the
Group employed 25 disabled persons (2009: 25 disabled persons).
ENVIRONMENTAL POLICY
Maintaining and improving the quality of the environment in
which we live is an important concern for the Group, our staff,
customers, suppliers, sub-contractors and communities in which
we operate. We have adopted high standards of environmental
practices and aim to minimise our impact on the environment
wherever possible.
DIRECTORS’ REPORT 16 Landkom International Plc Annual Report 2010
HEALTH AND SAFETY
The Group recognises the importance of maintaining high
standards of health and safety for everyone working within 
our business and also for anyone who may be affected by 
our businesses. Health and Safety is of particular importance 
to our employees. Consequently, each of our Farm Managers 
has appointed Health and Safety workers.
EVENTS AFTER THE REPORTING DATE
Events after the reporting date are described in note 34 to the
financial statements.
THIRD PARTY INDEMNITY PROVISION FOR DIRECTORS
Qualifying third party indemnity provision was in place for the
benefit of all Directors of the Company for the year.
AUDITOR
During the year Baker Tilly LLP resigned from office. The Directors
have resolved that Ernst & Young LLC be appointed auditor. Ernst
& Young LLC has indicated its willingness to continue in office.
ELECTRONIC COMMUNICATION
The maintenance and integrity of the Landkom International Plc
website is the responsibility of the Directors; the work carried out 
by the Auditors does not involve consideration of these matters
and accordingly, the Auditors accept no responsibility for any
changes that may have occurred to the financial statements
since they were initially presented on the website.
The Company’s website is maintained in compliance with 
AIM Rule 26.
By order of the Board
STEPHEN PICKUP
CHIEF FINANCIAL OFFICER
5 APRIL 2011
DIRECTORS’ REPORT
CONTINUED Landkom International Plc  Annual Report 2010 17
As the Company is admitted for trading on AIM it is not required 
to comply with the provisions of the Combined Code on
Corporate Governance issued by the Financial Reporting Council
(the Code). However the Directors aim to support the principles 
set out in the Code and comply in the areas that they consider
appropriate to do so given the Group’s size, resources and stage
of development. This statement describes how the best practice
principles of corporate governance are applied to the Group.
THE BOARD OF DIRECTORS
The Board, which is responsible for leading, developing and
protecting the interests of the Group, comprises three Non-
Executive Directors and two Executive Directors. The Non-
Executive Directors are of varied backgrounds and experience
and the Board considers them to exercise independent and
objective judgement.
There is a clear division of responsibilities at the head of the
Group between the Board and the Executive Management.
Board meetings are held on a regular basis. The Board sets
strategy, reviews business plans, trading performance and costs,
approves major capital investments and disposals, considers 
all significant operational and financial issues and approves 
the Group’s financial statements, control procedures and risk
management policies. The Board delegates decisions on
contracts and transactions in the ordinary course of business 
to executive management but approves significant transactions
such as bank facilities, forward sales of crops and hedging
contracts.
The Board receives timely information on all material aspects
about the Group to enable it to discharge its duties.
All serving Directors submit themselves for re-election at the
Annual General Meeting.
DIRECTORS’ REMUNERATION
The Company has established a Remuneration Committee the
members and activities of which are detailed in the
Remuneration Report.
Details of the remuneration of each Director are set out in the
Remuneration Report.
ACCOUNTABILITY AND AUDIT
The Company has established an Audit Committee which
comprises the three Non-Executive Directors. The Audit Committee
is chaired by John Mapplebeck who as a former bank executive
possesses both recent and relevant financial experience.
The Audit Committee, which has Terms of Reference agreed 
by the Board, is responsible for reviewing the Group’s accounting
policies, monitoring the integrity of the Group’s financial
statements and announcements and reviewing the internal
control and risk management systems and compliance
procedures. It is also responsible for reviewing the scope and
results of the audit, its cost-effectiveness and the independence
and objectivity of the Auditors. A formal Statement of
Independence is received from the external Auditor each year.
ATTENDANCE AT MEETINGS
The number of Board and committee meetings attended during
the year is as follows (figures in brackets indicate the number
attended by phone).
CORPORATE GOVERNANCE STATEMENT
DATE OF DATE OF BOARD AUDIT REMUNERATION
APPOINTMENT RESIGNATION MEETINGS COMMITTEE MEETINGS COMMITTEE MEETINGS
Number of meetings held 443
Neil Balfour 4 1 (1) 3
John Mapplebeck 6 January 2010 3 4 (0) 3
Tom Morrison 6 January 2010 3 3 (1) 3
Gerald Howarth 14 April 2010 3 1 (0) 2
Laurence Holyoake 6 January 2010 0 0 (0) 0
Vitaliy Skotsyk 4 * N/A * N/A
Stephen Pickup 4 * N/A * N/A
Ben Adams 6 January 2010 1 * N/A * N/A
* Attendance by invitation only 18 Landkom International Plc Annual Report 2010
INTERNAL CONTROLS
The Board acknowledges its responsibility for establishing and
monitoring the Group’s systems of internal control. The process
and systems of internal control are designed to manage rather
than eliminate the risk of failure to achieve business objectives
and can only provide reasonable and not absolute assurance
against material misstatement or loss.
The key procedures that have been established and which are
designed to provide effective control are as follows:
n Management structure – The Board meets regularly to
discuss all issues affecting the Group
n Investment appraisal – The Group has a clearly defined
framework for investment appraisal and approval is
required by the Board, where appropriate
The Board regularly reviews the effectiveness of the systems of
internal control and considers the major business, operational and
financial risks and the control environment and compliance
matters. No significant control deficiencies have come to light
during the year and no weaknesses in internal financial control
have resulted in any material losses, contingencies or uncertainties,
which would require disclosure as recommended by the guidance
for Directors on reporting on internal financial control.
The Audit Committee has recommended to the Board that, taking
into account the scale of the Group’s operating interests and
activities and in light of the control environment described above,
there is no current requirement for a separate internal audit
function. On a regular basis the Audit Committee will continue to
review the need to put in place an internal audit function.
RELATIONS WITH SHAREHOLDERS
The Chairman is the Company’s principal spokesperson with
investors, fund managers, the press and other interested parties. At
the Annual General Meeting, private investors are given the
opportunity to question the Board.
GOING CONCERN
The financial statements of the Group have been prepared on 
a going concern basis. Continued operations are reliant upon
material uncertainties including achieving a successful 2011
harvest, stable crop prices, continuing financial support from
Amaco Ukraine, Landkom’s major supplier through extended
credit terms, and the refinancing of US$9m loan in March 2012.
The Directors have concluded that this represents a material
uncertainty that may cast significant doubt over the Group’s 
ability to continue as a going concern. Nevertheless after making
enquiries and considering these uncertainties the Directors are
currently confident that the Group will continue to have adequate
resources to continue in operation for the foreseeable future. For
this reason, the financial statements of the Group have been
prepared on a going concern basis.
CORPORATE GOVERNANCE STATEMENT
CONTINUED Landkom International Plc  Annual Report 2010 19
The Group has a Remuneration Committee which was chaired by Gerald Howarth until his resignation on 14 April 2010 and subsequently by
John Mapplebeck. The Committee consists of the Chairman and the Non-Executive Directors.
The Chairman and Non-Executive Directors are responsible for the consideration and approval of the terms of service, remuneration, bonuses,
share options and other benefits of the other Directors. All decisions are made after giving due consideration to the size and nature of the
business and the importance of retaining and motivating management.
The Committee meets at least once a year and at other times as appropriate.
DIRECTORS’ CONTRACTS AND LETTERS OF APPOINTMENT
EXECUTIVE DIRECTORS: DATE OF NOTICE 
CONTRACT PERIOD
Vitaliy Skotsyk 17 February 2010 2 weeks*
Stephen Pickup 1 June 2008 6 months**
Ben Adams (resigned 6 January 2010) 16 May 2008 6 months
* The maximum employee notice period under Ukrainian legislation is two weeks.
** Stephen Pickup notified the Company on 24 January 2011 of his intention to resign from the board. This is expected to take place in
April 2011.
NON-EXECUTIVE DIRECTORS: DATE OF NOTICE 
CONTRACT PERIOD
Neil Balfour 15 October 2007 3 months
Gerald Howarth (resigned 14 April 2010) 15 October 2007 3 months
John Mapplebeck 5 January 2010 3 months
Tom Morrison 5 January 2010 3 months
Laurence Holyoake (resigned 6 January 2010) 8 February 2008 3 months
DIRECTORS EMOLUMENTS
The aggregate emoluments of the Directors of the Group whilst serving as a Director during the year, were as follows:
SALARIES BONUSES BENEFITS TOTAL
$000 $000 $000 $000
2010 2010 2010 2010
Executive Directors
Vitaliy Skotsyk 253 –4 257
Stephen Pickup 158 –3 161
Ben Adams (resigned 6 January 2010) 68 –1 69
479 –8 487
Non-Executive Directors
Neil Balfour 74 –– 74
Gerald Howarth (resigned 14 April 2010) 33 –– 33
John Mapplebeck 45 –– 45
Tom Morrison 45 –– 45
Laurence Holyoake (resigned 6 January 2010) 20 –– 20
217 –– 217
Total Directors’ emoluments 696 –8 704
REMUNERATION REPORT 20 Landkom International Plc Annual Report 2010
The aggregate emoluments of the Directors of the Group whilst serving as a Director during the 10 months to 31 October 2009, were as follows:
SALARIES BONUSES BENEFITS TOTAL
$000 $000 $000 $000
2009 2009 2009 2009
Executive Directors
Vitaliy Skotsyk 10 –– 10
Stephen Pickup 129 –2 131
Ben Adams (resigned 6 January 2010) 112 –2 114
Konrad Nowicki (resigned 2 June 2009) 82 –– 82
Richard Spinks (resigned 28 August 2009) 167 –2 169
500 –6 506
Non-executive Directors
Neil Balfour 58 –– 58
Gerald Howarth 39 –– 39
John Mapplebeck –– – –
Tom Morrison –– – –
Laurence Holyoake (resigned 6 January 2010) 39 – 20 59
David Mackie (resigned 10 February 2009) 5– – 5
141 – 20 161
Total Directors’ emoluments 641 – 26 667
DIRECTORS’ INTERESTS IN SHARE OPTIONS
Directors’ interests in share options of the Company as at 31 October 2010 were as follows:
BALANCE AT GRANTED LAPSED/ BALANCE AT DATE FROM
NAME OF 31 OCTOBER DURING CANCELLED 31 OCTOBER DATE OF WHICH EXPIRY EXERCISE
PARTICIPANT 2009 YEAR DURING YEAR 2010 GRANT EXERCISABLE DATE PRICE
Neil Balfour 567,625 –– 567,625 22/11/07 22/11/08 21/11/12 52p
Vitaliy Skotsyk – 2,900,059 – 2,900,059 27/11/09 27/11/10 26/11/15 6.75p
– 2,900,060 – 2,900,060 27/11/09 27/11/11 26/11/16 6.75p
– 2,900,060 – 2,900,060 27/11/09 27/11/12 26/11/17 6.75p
Stephen Pickup 666,666 –– 666,666 29/09/08 29/09/09 28/09/14 30p
666,667 –– 666,667 29/09/08 29/09/10 28/09/15 30p
666,667 –– 666,667 29/09/08 29/09/11 28/09/16 30p
166,666 –– 166,666 05/05/09 05/05/10 04/05/15 17p
166,667 –– 166,667 05/05/09 05/05/11 04/05/16 17p
166,667 –– 166,667 05/05/09 05/05/12 04/05/17 17p
– 1,166,666 – 1,166,666 27/11/09 27/11/10 26/11/15 6.75p
– 1,166,667 – 1,166,667 27/11/09 27/11/11 26/11/16 6.75p
- 1,166,667 – 1,166,667 27/11/09 27/11/12 26/11/17 6.75p
3,067,625 12,200,179 – 15,267,804
The closing price of Landkom International Plc shares at 29 October 2010 was 7.38p. During the year the market price of the Company’s
ordinary shares ranged from 5.13p to 10.5p.
REMUNERATION REPORT
CONTINUED Landkom International Plc  Annual Report 2010 21
In addition to the share options granted to the Directors the following have been granted to other employees within the Group.
BALANCE AT GRANTED LAPSED/ BALANCE AT DATE FROM
31 OCTOBER DURING CANCELLED 31 OCTOBER DATE OF WHICH EXPIRY EXERCISE
2009 YEAR DURING YEAR 2010 GRANT EXERCISABLE DATE PRICE
1,324,460 – 662,230 662,230 22/11/2007 22/11/2008 21/11/2013 52p
504,556 – 252,278 252,278 22/11/2007 22/11/2009 21/11/2014 65p
504,556 – 252,278 252,278 22/11/2007 22/11/2010 21/11/2015 78p
409,952 – 409,952 – 10/06/2008 10/06/2009 09/06/2014 86p
1,183,333 – 1,050,000 133,333 29/09/2008 29/09/2009 28/09/2014 30p
333,333 – 333,333 – 29/09/2008 29/09/2010 28/09/2015 30p
333,334 – 333,334 – 29/09/2008 29/09/2011 28/09/2016 30p
300,000 –– 300,000 05/05/2009 15/12/2009 14/12/2014 17p
150,000 –– 150,000 05/05/2009 15/12/2010 14/12/2015 17p
150,000 –– 150,000 05/05/2009 15/12/2011 14/12/2016 17p
166,666 –– 166,666 05/05/2009 06/02/2010 05/02/2015 17p
166,667 – 166,667 – 05/05/2009 06/02/2011 05/02/2016 17p
166,667 – 166,667 – 05/05/2009 06/02/2012 05/02/2017 17p
231,536 – 87,501 144,035 05/05/2009 05/05/2010 04/05/2015 17p
194,035 – 156,535 37,500 05/05/2009 05/05/2011 04/05/2016 17p
194,033 – 156,533 37,500 05/05/2009 05/05/2012 04/05/2017 17p
– 2,145,834 – 2,145,834 27/11/2009 27/11/2010 26/11/2015 6.75p
– 2,145,834 – 2,145,834 27/11/2009 27/11/2011 26/11/2016 6.75p
– 2,145,832 – 2,145,832 27/11/2009 27/11/2012 26/11/2017 6.75p
6,313,128 6,437,500 4,027,308 8,723,320
The Company’s Remuneration Committee is responsible for the administration of the Share Scheme (the Scheme). The rules of the Scheme
are the same for both Directors and employees. Unless otherwise approved by the remuneration committee, the Options granted vest in three
equal tranches on the anniversary of the grant for each of the three years after the date of the grant. The Committee may impose objective
conditions upon the granting of an Option as to the performance of the Group which must be satisfied before Options can be exercised.
Options granted to date have no such performance targets.
The total Options in issue of 23,991,127 represented 5.5% of the issued share capital of 435,008,935 shares at 31 October 2010. The Scheme
permits Options to be granted up to a total of 10% of the Ordinary Shares in issue.
On behalf of the Board
JOHN MAPPLEBECK
CHAIRMAN OF THE REMUNERATION COMMITTEE
5 APRIL 2011 22 Landkom International Plc Annual Report 2010
The directors are responsible for the preparation of the financial statements. The directors have elected to prepare the financial statements in
accordance with International Financial Reporting Standards (‘IFRS’) as adopted by the European Union. In preparing these financial
statements, the directors are required to:
n select suitable accounting policies and then apply them on a consistent basis;
n make judgments and estimates that are reasonable and prudent;
n state that the financial statements comply with IFRS; and
n prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping reliable accounting records which correctly explain the transactions of the company, and which
enable the financial position of the company to be determined with reasonable accuracy. They are also responsible for safeguarding the
assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES Landkom International Plc  Annual Report 2010 23
We have audited the company’s financial statements for the year ended 31 October 2010 which comprise the group statement of
comprehensive income, group statement of financial position, group statement of changes in equity, group statement of cash flows, and the
related notes 1 to 35. These financial statements have been prepared on the basis of the accounting policies set out therein.
This report is made solely to the company’s members, as a body. Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body for
our audit work, for this report or for the opinions we have formed.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described in the statement of directors’ responsibilities, the company’s directors are responsible for the preparation of the financial
statements in accordance with applicable Isle of Man law and appropriate accounting standards.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International
Standards on Auditing (UK & Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view.
In addition we also report if, in our opinion, the group has not kept proper accounting records, if we have not received all the information and
explanations we require for our audit, or if information specified by law regarding directors’ remuneration and transactions with the company
is not disclosed.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with International Standards on Auditing (UK & Ireland) issued by the Auditing Practices Board. An
audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an
assessment of the significant estimates and judgements made by the directors in the preparation of the financial statements, and of whether
the accounting policies are appropriate to the group’s circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to
provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether
caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information
in the financial statements.
EMPHASIS OF MATTER – GOING CONCERN
In forming our opinion, which is not qualified we have also considered the adequacy of the disclosures made in note 2.1 to the financial
statements concerning the company's ability to continue as a going concern. The conditions described in note 2.1 indicate the existence of a
material uncertainty which may cast significant doubt about the company's ability to continue as a going concern. The financial statements
do not include the adjustments that would result if the company was unable to continue as a going concern.
Opinion
In our opinion the financial statements give a true and fair view, in accordance with International Financial Reporting Standards, of the state
of affairs of the company and of the group as at 31 October 2010 and of the loss of the group for the year then ended.
ERNST & YOUNG LLC
CHARTERED ACCOUNTANTS
ISLE OF MAN
5 APRIL 2011
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS
OF LANDKOM INTERNATIONAL PLC 24 Landkom International Plc Annual Report 2010
YEAR ENDED 31 OCTOBER 2010 10 MONTH PERIOD ENDED 31 OCTOBER 2009
RESULT BEFORE BIOLOGICAL RESULT BEFORE BIOLOGICAL
BIOLOGICAL ASSET BIOLOGICAL ASSET
ASSETS ADJUSTMENT TOTAL ASSETS ADJUSTMENT TOTAL
NOTE $000 $000 $000 $000 $000 $000
Continuing operations
Revenue 5 16,799 – 16,799 14,553 – 14,553
Gains/(losses) arising from changes in
value of biological assets 16 – 3,047 3,047 – (8,509) (8,509)
Direct costs 6 (16,087) (2,919) (19,006) (30,332) 8,441 (21,891)
Depreciation on farming property
plant and equipment 14 (7,070) – (7,070) (6,213) – (6,213)
Gross (loss)/profit (6,358) 128 (6,230) (21,992) (68) (22,060)
Distribution costs (425) – (425) (6) – (6)
Administrative expenses 7 (4,920) – (4,920) (4,375) – (4,375)
Other operating income 8 154 – 154 1,237 – 1,237
Other operating expense 8 (700) – (700) (215) (215)
Net foreign exchange gain/(losses) 423 – 423 (2,026) – (2,026)
Operating loss 8 (11,826) 128 (11,698) (27,377) (68) (27,445)
Exceptional items 9 103 – 103 (14,505) – (14,505)
Finance income 10 8– 8 8 – 8
Finance costs 11 (170) – (170) (66) – (66)
Share of loss from associate (4) – (4) (98) – (98)
Loss before income tax (11,889) 128 (11,761) (42,038) (68) (42,106)
Income tax expense 12 (86) – (86) (20) – (20)
Loss for year/period (11,975) 128 (11,847) (42,058) (68) (42,126)
Other comprehensive income, net of tax
Exchange differences on retranslation of
foreign income 23 (840) – (840) 1,718 – 1,718
Total comprehensive loss for the year/period (12,815) 128 (12,687) (40,340) (68) (40,408)
Loss for the year/period attributable to:
Equity holders of the Company (11,546) 128 (11,418) (41,986) (68) (42,054)
Non-controlling interests (429) – (429) (72) – (72)
Total comprehensive loss for the
year/period attributable to:
Equity holders of the company (12,386) 128 (12,258) (40,268) (68) (40,336)
Non-controlling interests (429) – (429) (72) – (72)
Loss per share (expressed in cents per share)
Basic loss per ordinary share 13 (2.7)c (18.2)c
Restated in pence per share (1.7)p (11.0)p
Fully diluted loss per ordinary share 13 (2.7)c (18.2)c
Restated in pence per share* (1.7)p (11.0)p
* at an exchange rate of GBP/USD of 0.62
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2010 Landkom International Plc  Annual Report 2010 25
31 OCTOBER 2010 31 OCTOBER 2009
NOTE $000 $000
Assets
Non-current assets
Property, plant & equipment 14 35,873 40,519
Intangible assets 15 229 27
36,102 40,546
Current assets
Biological assets 16 7,626 4,098
Inventories 17 9,936 5,166
Trade and other receivables 18 3,669 685
Cash and cash equivalents 19 2,341 222
23,572 10,171
Total assets 59,674 50,717
Capital & reserves attributable to equity holders of the Company
Share capital 20 789 466
Share premium 21 159,350 144,349
Retained loss (108,526) (97,754)
Share based payments reserve 22 1,710 1,776
Foreign exchange reserve 23 (7,016) (6,176)
Total equity attributable to equity holders 46,307 42,661
Equity attributable to non-controlling interests (260) 169
Total equity 46,047 42,830
Liabilities
Non-current liabilities
Non current payables 290 284
Other financial liabilities 24 – 66
290 350
Current liabilities
Trade and other payables 26 13,225 6,665
Borrowings 25 58 –
Other financial liabilities 24 54 872
13,337 7,537
Total liabilities 13,627 7,887
Total liabilities and shareholders’ equity 59,674 50,717
The financial statements on pages 24 to 66 were approved by the Board of Directors and authorised for issue on 5 April 201 1 and signed on its
behalf by:
STEPHEN PICKUP   VITALIY SKOTSYK
CHIEF FINANCIAL OFFICER CHIEF EXECUTIVE OFFICER
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 OCTOBER 2010 26 Landkom International Plc Annual Report 2010
10 MONTH 
YEAR ENDED PERIOD ENDED
31 OCTOBER 2010 31 OCTOBER 2009
NOTE $000 $000
Cash flows from operating activities
Loss before tax (11,761) (42,106)
Adjustment for:
Depreciation and amortisation 7,299 6,428
Impairment of property, plant and equipment – 2,117
Impairment of intangible assets – 202
Loss on disposal of property, plant and equipment 160 126
Share based payment charge 22 580 394
Impairment of VAT receivable – 10,179
Provision on receivable – 309
Impairment of goodwill and investments – 647
Impairment of associate loan – 649
Impairment of biological asset – 519
Share of loss in associate 4 98
Gain on acquisition 32 (103) –
Fair value adjustment recognised in the statement 
of comprehensive income:
Biological asset (3,047) 8,509
Non operating activity income/expense 
in the statement of comprehensive income:
Finance income 10 (8) (8)
Finance costs 11 170 66
Movements in working capital:
(Increase)/Decrease in inventories (4,764) 2,101
(Increase)/Decrease in trade and other receivables (2,584) 357
Increase in trade and other payables 5,754 58
Income tax paid (86) (20)
Net (additions)/reductions from biological assets (481) 233
Net cash used in operations (8,867) (9,142)
Cash flows from investing activities
Purchase of property, plant and equipment (2,652) (967)
Purchase of intangible assets (84) –
Proceeds from disposal of property, plant and equipment 417 527
Interest received 88
Loans to associated companies (400) (261)
Acquisition of Morion Agro PP net of cash acquired 32 (193) –
Net cash used in investing activities (2,904) (693)
Cash flows from financing activities
Proceeds from issue of ordinary shares 16,155 6,630
Payment of transaction costs (831) (40)
Finance costs (170) (921)
Repayment of borrowings (24) –
Repayment of finance lease liabilities (884) –
Non controlling interest investment into Group – 308
Net cash received from financing activities 14,246 5,977
Net increase/(decrease) in cash and cash equivalents 2,475 (3,858)
Cash and cash equivalent at beginning of year/period 222 4,230
Effect of foreign exchange variances (356) (150)
Cash and cash equivalents at end of the year/period 19 2,341 222
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 OCTOBER 2010 Landkom International Plc  Annual Report 2010 27
TOTAL EQUITY
SHARE ATTRIBUTABLE
FOREIGN BASED TO SHARE- NON-
SHARE SHARE EXCHANGE PAYMENTS RETAINED HOLDERS OF CONTROLLING TOTAL
CAPITAL PREMIUM RESERVE RESERVE EARNINGS THE PARENT INTEREST EQUITY
Balance at 31 December 2008 411 137,814 (7,894) 2,754 (57,072) 76,013 77 76,090
Loss for the period –– – – (42,054) (42,054) (72) (42,126)
Currency translation differences –– 1,718 –– 1,718 – 1,718
Total recognised income
and expense –– 1,718 – (42,054) (40,336) (72) (40,408)
Non-controlling interest on business
combinations –– – – – – (143) (143)
Non-controlling interest share 
of shares issued in subsidiary –– – – – – 307 307
Proceeds from shares issued 55 –– – – 55 – 55
Premium from shares issued – 6,575 –– – 6,575 – 6,575
Share based payments charge –– – 394 – 394 – 394
Cancellation of share options –– – (1,372) 1,372 –– –
Share issue costs – (40) –– – (40) – (40)
Balance at 31 October 2009 466 144,349 (6,176) 1,776 (97,754) 42,661 169 42,830
Loss for the year –– – – (11,418) (11,418) (429) (11,847)
Currency translation differences –– (840) –– (840) – (840)
Total recognised income 
and expense –– (840) – (11,418) (12,258) (429) (12,687)
Proceeds from shares issued 323 –– – – 323 – 323
Premium from shares issued – 15,832 –– – 15,832 – 15,832
Share based payments charge –– – 580 – 580 – 580
Cancellation of share options –– – (646) 646 –– –
Share issue costs – (831) –– – (831) – (831)
Balance at 31 October 2010 789 159,350 (7,016) 1,710 (108,526) 46,307 (260) 46,047
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 OCTOBER 2010 28 Landkom International Plc Annual Report 2010
1. GENERAL INFORMATION
1.1 ORGANISATION AND OPERATIONS
Landkom International Plc (‘the Company’) is a public limited liability company and was incorporated in the Isle of Man on
10 April 2007. Its Registered Office is at 1 1 Hope Street, Douglas and its principal place of business is 2 Brovarska street, Prolisky village,
Kiev region, Ukraine. The principal activity of the Company and its subsidiaries (together ‘the Group’) is the cultivation and distribution 
of arable crops for the biofuel and food markets.
2. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These
policies have been consistently applied unless otherwise stated.
2.1 BASIS OF PREPARATION
The consolidated financial statements of Landkom International Plc have been prepared in accordance with International Financial
Reporting Standards (‘IFRS’) as adopted by the European Union. The consolidated financial statements have been prepared on the
historical cost basis except for derivative financial instruments measured at fair value and biological assets measured at fair value less
point of sale costs.
The Group has prepared a cash flow forecast which takes into account reasonably possible cash inflows and outflows from its
operations and external funding. The forecast has been prepared through to August 2012 and supports the conclusion of the Directors
that the Group will be able to operate as a going concern with its current resources and those anticipated in the future.
The cash flow forecast is dependent on the following key assumptions:
n Achieving a successful 201 1 harvest with yields and prices in line with management forecasts. Yield forecasts for rapeseed and
wheat are based on levels historically achieved by the Group. Prices forecast for rapeseed, the Group’s principle export crop, are
based on prices achieved by the Group in March 201 1. Prices for the Group’s remaining crops, principally wheat and maize, are
based on current prices in Ukraine.
n The ability of Amaco Ukraine, or other major trade suppliers, to continue providing financial support through extended credit terms
until the 201 1 harvest.
n The refinancing in March 2012 of the current US$9m debt facility, which is due for repayment by the end of February 2012.
The Directors have concluded that these are material uncertainties that may cast significant doubt over the Group’s ability to continue
as a going concern. Nevertheless after making enquiries and considering the uncertainties, the Directors remain confident that the
Group will continue to have adequate resources to continue in operation for the foreseeable future. For this reason, the financial
statements of the Group have been prepared on a going concern basis.
Accordingly, these financial statementsdo not include any adjustments to the carrying amount or classification of assets and liabilities
that would result if the Group were unable to continue as a going concern.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires
Management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher
degree of judgement of complexity, or areas where assumptions and estimates are significant to the consolidated financial statements
are disclosed in note 3.
The Group adopted the following new and amended standards as at 1 November 2009:
Standards affecting the reported results and financial positions
IFRS 3 Business combinations
The revised standard was issued in January 2008 and became effective for financial years beginning on or after 1 July 2009. Changes
affect the valuation of non-controlling interest, accounting for transaction costs, initial and subsequent measurement of a contingent
consideration and business combinations achieved in stages. Its adoption has affected the accounting for the business combination in
the current period and the acquisition costs incurred have been expensed and included in administrative expenses.
IAS 27 – Consolidated and separate financial statements
The revised standard was issued in January 2008 and became effective for financial years beginning on or after 1 July 2009. The
changes of the revised standard affect the Group’s accounting policies regarding changes in ownership interests in its subsidiaries that
do not result in a change in control. Under the revised standard, all such increases or decreases are dealt with in equity, with no impact
on goodwill or profit or loss.
Standards affecting presentation and disclosures
None of the new or revised standards to be adopted for the financial year 2010 affected the presentation and disclosures.
Standards and interpretations adopted with no effect on reported results, financial position and disclosure
IFRS 2 – Share-based payment – group cash-settled share-based payment transactions
The amendment to the standard was issued in June 2009 and became effective for financial years beginning on or after 1 January
2010. The amendment clarifies the accounting for group cash-settled share-based payment transactions and supersedes IFRIC 8 and
IFRIC 1 1. The adoption of this amendment did not have any impact on the reported results, financial position and disclosures.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Landkom International Plc  Annual Report 2010 29
IAS 28 – Investments in associates
The revised standard was issued in May 2008 and became effective for financial years beginning on or after 1 July 2009. The
principle adopted under IAS 27 – Consolidated and separate financial statements that a loss of control is recognised as a disposal
and reacquisition of any retained interest at fair value is extended by consequential amendment to IAS 28. Therefore, when
significant influence is lost, the investor measures any investment retained in the former associate at fair value, with any
consequential gain or loss recognised in profit or loss. The adoption of the revised standard did not have any impact on the
reported results, financial position and disclosures.
The Group has elected not to early adopt the following revised and amended standards:
IAS 24 Related party disclosures
The amended standard was issued in November 2009 and becomes effective for financial years beginning on or after 1 January 201 1.
The revised standard introduces a partial exemption of disclosure requirements for government-related parties and clarifies the
definition of a related party to simplify the identification of such relationships and to eliminate inconsistencies in the application. The
Group does not expect any impact on its financial position or performance and does not intend to take advantage of the possibility of
an early adoption.
IAS 32 Financial instruments: presentation – classification of rights issues
The amendment to IAS 32 on the classification of rights issues has been issued in October 2009 and is effective for annual periods
beginning on or after 1 February 201 1. For rights issues offered for a fixed amount of foreign currency current practice appears to
require such issues to be accounted for as derivative liabilities. The amendment states that if such rights are issued pro rata to all of an
entity’s existing shareholders in the same class for a fixed amount of currency, they should be classified as equity regardless of the
currency in which the exercise price is denominated. This amendment will have no impact on the Group after initial application and
will be adopted by Group for the Group’s reporting financial statements for the period beginning 1 January 2012.
IFRS 9 Financial instruments: classification and measurement
The IASB has issued the first phase of IFRS 9 that will replace IAS 39. The new standard applies to classification and measurement of
financial assets as defined in IAS 39. The standard is effective for annual periods beginning on or after 1 January 2013. The adoption of
the first phase of IFRS 9 might have an effect on the classification and measurement of the Group’s financial assets. The Group will
quantify the effect in conjunction with the other phases, when issued, to present a comprehensive picture. The IASB will address
classification and measurement of financial liabilities, hedge accounting and derecognition in separate phases and the completion of
the new standard is expected to be in early 201 1.
IFRIC 14 Prepayment of a minimum funding requirement
The amendment to IFRIC 14 is effective for financial years beginning on or after 1 January 201 1 and will have to be retrospectively
applied. The amendment provides guidance on assessing the recoverable amount of net pension assets and permits an entity to treat
the prepayment of a minimum funding requirement as asset. The future application of this amendment is deemed to have no impact
on the financial statements of the Group.
IFRIC 19 Extinguishing financial liabilities with equity instruments
IFRIC 19 is effective for annual periods beginning on or after 1 July 2010. The new interpretation addresses the accounting by the entity
that issues equity instruments in order to settle, in full or in part, a financial liability. The adoption of this interpretation will have no effect
on the financial statements of the Group.
2.2 CONSOLIDATION
Basis of consolidation from 1 November 2009
The consolidated financial statements comprise the financial statements of the Group and its subsidiaries as at 31 October 2010.
Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be
consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting
period as the parent company, using consistent accounting policies. All intra-group balances, transactions, unrealised gains and losses
resulting from intra-group transactions and dividends are eliminated in full.
Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance. Change in the ownership
interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it:
n Derecognises the assets (including goodwill) and liabilities of the subsidiary
n Derecognises the carrying amount of any non-controlling interest
n Derecognises the cumulative translation differences, recorded in equity
n Recognises the fair value of the consideration received
n Recognises the fair value of any investment retained
n Recognises any surplus or deficit in profit or loss
n Reclassifies the parent’s share of components previously recognised in other comprehensive income to profit or loss or retained
earnings, as appropriate. 30 Landkom International Plc Annual Report 2010
2.2 CONSOLIDATION CONTINUED
Basis of consolidation prior to 1 November 2009
Certain of the above-mentioned requirements were applied on a prospective basis. The following differences, however, are carried
forward in certain instances from the previous basis of consolidation:
n Acquisitions of non-controlling interests, prior to 1 January 2010, were accounted for using the parent entity extension method,
whereby, the difference between the consideration and the book value of the share of the net assets acquired were recognised in
goodwill.
n Losses incurred by the Group were attributed to the non-controlling interest until the balance was reduced to nil. Any further excess
losses were attributed to the parent, unless the non-controlling interest had a binding obligation to cover these. Losses prior to 1
January 2010 were not reallocated between NCI and the parent shareholders.
n Upon loss of control, the Group accounted for the investment retained at its proportionate share of net asset value at the date
control was lost. The carrying value of such investments at 1 January 2010 have not been restated.
2.3 SEGMENT REPORTING
The Group produces arable crops in Ukraine with all customers based in Ukraine. Financial information is reported to the board in IFRS
accounting format with profit, assets and liabilities as one agricultural operating segment.
2.4 FOREIGN CURRENCY TRANSLATION
(a) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic
environment in which the entity operates (‘the functional currency’).The parent entity’s functional currency is Pounds Sterling. The
functional currency of the Group’s main operating subsidiary is US Dollars. The consolidated financial statements are presented in 
US Dollars.
The Group has determined that the main underlying currency of agricultural crop inputs and outputs is US Dollars. As such it has
selected US Dollars as its presentational currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period
end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss, except
when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.
Translation differences on non-monetary financial assets and liabilities are reported as part of the fair value gain or loss. Translation
differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in
profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets such as equities classified as
available for sale are included in the fair value reserve in equity and are recognised in other comprehensive income.
(c) Group companies
The results and financial position of all the Group companies (none of which has a currency of a hyperinflationary economy) that
have a functional currency different from the presentation currency are translated into the presentation currency as follows:
n assets and liabilities for each statement of financial position are translated at the closing rate at the reporting date;
n income and expenses for each statement of comprehensive income are translated at average exchange rates (unless this average
is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income
and expenses are translated at the rate on the dates of the transactions);
n all resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to
shareholders’ equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are
recognised in the profit or loss as part of the gain or loss on sale.
The principal exchange rates used in the preparation of the consolidated financial statements are as follows:
31 OCTOBER 2010 31 OCTOBER 2009
Exchange rate for statement of financial position translation:
Pounds sterling 0.62 to US$ 1 0.62 to US$ 1
Ukrainian Hryvnya 7.97 to US$1 8.13 to US$1
Average exchange rate for income statement translation:
Pounds sterling 0.64 to US$ 1 0.65 to US$ 1
Ukrainian Hryvnya 7.98 to US$ 1 8.16 to US$ 1
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 31
2.5 PROPERTY PLANT AND EQUIPMENT
Property, plant and equipment are stated at historical cost, less accumulated depreciation and accumulated impairment losses.
Depreciation is provided on all property, plant and equipment, except freehold land and is calculated using the straight-line method to
allocate their cost or revalued amounts to their residual values over their estimated useful lives as follows:
Buildings 3 – 50 years
Machinery 5 – 10 years
Furniture, fittings and equipment 3 – 5 years
Vehicles 3 – 10 years
The assets’ residual values and useful lives are reviewed, and adjusted, if appropriate, at each reporting date. An asset’s carrying
amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable
amount. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised
within administrative expenses in the statement of comprehensive income.
Assets under construction are stated at cost less impairment losses. The cost of completed construction work is transferred to the
appropriate category of property, plant and equipment. Depreciation commences when the relevant assets become operational.
2.6 LEASING
Leases of property, plant and equipment which transfer substantially all the risks and rewards of ownership to the Group are classified
as finance leases. Finance leases are classified as a financial liability and measured at amortised cost. Finance leases are capitalised
at the inception of the lease at the lower of the fair value of the leased property, plant and equipment and the present value of the
minimum lease payments and depreciated over the period of the lease. The resulting lease obligations are included in liabilities. Lease
payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest
on the remaining balance of the liability.
All other leases are classified as operating leases. Rentals payable under operating leases, net of lease incentives, are charged to the
consolidated statement of comprehensive income on a straight-line basis over the period of the lease. Where property lease contracts
contain guaranteed minimum incremental rental payments, the total committed cost is determined and is amortised on a straight-line
basis over the life of the lease.
2.7 INTANGIBLE ASSETS
Intangible assets are recognised when they are controlled through contractual or other legal rights, or are separable from the rest of
the business, and the fair value can be reliably measured.
Applications and IT software
Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific
software. These costs are amortised over their estimated useful lives (three to five years). Amortisation of intangible assets is charged to
the statement of comprehensive income under the heading of administrative expenses.
2.8 BUSINESS COMBINATIONS
Business combinations from 1 January 2010
Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate 
of the consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the
acquiree. For each business combination, the acquirer measures the non-controlling interest in the acquiree either at fair value or 
at the proportionate share of the acquiree’s identifiable net assets. Acquisition costs incurred are expensed and included in
administrative expenses.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and
designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.
This includes the separation of embedded derivatives in host contracts by the acquiree.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the
acquiree is re-measured to fair value at the acquisition date through profit or loss.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognised in accordance
with IAS 39 either in profit or loss or as a change to other comprehensive income. If the contingent consideration is classified as equity, it
should not be re-measured until it is finally settled within equity. 32 Landkom International Plc Annual Report 2010
2.8 BUSINESS COMBINATIONS CONTINUED
Business combinations prior to 1 January 2010
In comparison to the above-mentioned requirements, the following differences applied:
Business combinations were accounted for using the purchase method. Transaction costs directly attributable to the acquisition formed
part of the acquisition costs. The non-controlling interest (formerly known as minority interest) was measured at the proportionate share
of the acquiree’s identifiable net assets.
Business combinations achieved in stages were accounted for as separate steps. Any additional acquired share of interest did not
affect previously recognised goodwill. 
When the Group acquired a business, embedded derivatives separated from the host contract by the acquiree were not reassessed
on acquisition unless the business combination resulted in a change in the terms of the contract that significantly modified the cash
flows that otherwise would have been required under the contract.
Contingent consideration was recognised if, and only if, the Group had a present obligation, the economic outflow was more likely
than not and a reliable estimate was determinable. Subsequent adjustments to the contingent consideration were recognised as part
of goodwill.
2.9 IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
At each reporting date, the Group reviews the carrying amounts of its property, plant and equipment and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any. Where the asset does not
generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash generating unit
to which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an
indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. 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 which the estimates of future cash flows have been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of
the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately,
unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised
estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an
impairment loss is recognised as income immediately, unless the relevant asset is carried at a revalued amount, in which case the
reversal of the impairment loss is treated as a revaluation increase.
2.10 INVENTORIES
Inventories are stated at the lower of cost and net realisable value. Cost is determined using the first in first out (FIFO) method. The cost
of work in progress includes costs of preparing agricultural land, raw materials, direct labour, other direct costs and related production
overheads (based on normal operating capacity). It excludes borrowing costs. Net realisable value is the estimated selling price in the
ordinary course of business, less applicable variable selling expenses.
2.11 BIOLOGICAL ASSETS
The Group classifies crops as biological assets. Biological assets are stated at their fair value, based on their current condition, less
estimated point-of-sale costs. The fair value of biological assets is based on market selling price and direct costs required to bring the
assets to saleable condition, discounted at an appropriate discount rate at the reporting date. Agricultural produce harvested from the
Group’s biological assets is recognised as inventory measured at the fair value less costs to sell at the point of harvest. Biological assets
that are physically attached to land are recognised and measured at their fair value separately from the land.
The Group classifies livestock as biological assets. Livestock are accounted for at fair value less estimated point of sale costs. The fair
value of livestock is determined by the size of the herd and market prices at the reporting date.
Where there is no reliable measure of the fair value of biological assets at the point of initial recognition, they are measured at cost less
any impairment losses.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 33
2.12 TRADE RECEIVABLES
Trade receivables, defined as loans and receivables in accordance with IAS 39 ‘Financial Instruments: Recognition and Measurement’,
are recorded initially at fair value and subsequently measured at amortised cost. A provision for impairment of trade receivables is
established when there is evidence that the Group will not be able to collect all amounts due according to the original terms of the
receivables. The amount of the provision is the difference between the assets’ carrying amount and the present value of future cash
flows discounted at the effective interest rate. The movement in the provision is recognised in the consolidated statement of
comprehensive income. Any other trade receivables are recognised at their original amount less an allowance for any doubtful
amounts. An allowance is made when collection of the full amount is no longer considered probable.
2.13 CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with
original maturities of three months or less, and bank overdrafts.
2.14 SHARE CAPITAL
Ordinary shares are classified as equity. Equity instruments issued by the Company are recorded at the proceeds received, net of direct
issue costs.
2.15 TRADE PAYABLES
Trade payables, defined as financial liabilities in accordance with IAS 39, are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method. All of the trade payables are noninterest bearing.
2.16 BORROWING COSTS
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period
of time to get ready for its intended use or sale are capitalised as part of the cost of the respective assets. All other borrowing costs are
expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the
borrowing of funds.
The Group capitalises borrowing costs for all eligible assets where construction was commenced on or after 1 January 2009.
2.17 TAXATION
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the period. Taxable profit differs from net profit as reported in the profit or loss,
because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are
never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively
enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in
the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the
balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can
be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from
the initial recognition (other than in a business combination) of other assets and liabilities in a transaction which affects neither the tax
profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and
interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled.
Deferred tax is charged or credited in the profit or loss, except when it relates to items credited or charged in other comprehensive
income directly to equity, in which case the deferred tax is also dealt with in other comprehensive income.
2.18 EMPLOYEE BENEFITS
(a) Pension obligations
Group companies do not operate private pension schemes. The Group makes contributions for the benefit of employees to Ukraine’s
state pension fund, social security fund, security against injury fund and unemployment fund. These amounts are expensed as incurred.
(b) Termination benefits
Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever an
employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits when it is
demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without
possibility of withdrawal; or providing termination benefits as a result of an offer made to encourage voluntary redundancy. 34 Landkom International Plc Annual Report 2010
2.19 SHARE-BASED PAYMENTS
Employees of the Group receive remuneration in the form of share-based payment transactions, whereby employees render services
as consideration for equity instruments (equity-settled transactions).
The cost of equity-settled transactions is recognised, together with a corresponding increase in other capital reserves in equity, over the
period in which the performance and/or service conditions are fulfilled. The cumulative expense recognised for equity-settled
transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s
best estimate of the number of equity instruments that will ultimately vest. The income statement expense or credit for a period
represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in
employee benefits expense.
No expense is recognised for awards that do not ultimately vest, except for equity-settled transactions where vesting is conditional upon
a market or non-vesting condition, which are treated as vesting irrespective of whether or not the market or non-vesting condition is
satisfied, provided that all other performance and/or service conditions are satisfied.
Where the terms of an equity-settled transaction award are modified, the minimum expense recognised is the expense as if the terms
had not been modified, if the original terms of the award are met. An additional expense is recognised for any modification that
increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the
date of modification.
Where an equity-settled award is cancelled, it is treated as if it vested on the date of cancellation, and any expense not yet recognised
for the award is recognised immediately. This includes any award where non-vesting conditions within the control of either the entity or
the employee are not met. However, if a new award is substituted for the cancelled award, and designated as a replacement award
on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award, as
described in the previous paragraph. All cancellations of equity-settled transaction awards are treated equally.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share unless
a loss for the period has been recognised in which case the loss is not further diluted.
2.20 PROVISIONS
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an
outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. If the effect is
material, provisions are determined by discounting the expected future cash flows at an appropriate pre-tax discount rate.
2.21 FINANCIAL INSTRUMENTS
Derivative financial instruments
The Group does not hold any derivative financial instruments.
Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity, trade and other receivables, cash and cash equivalents, loans and
borrowings and trade and other payables. Non-derivative financial instruments are recognised at fair value (being the fair value of the
consideration given or received) plus any directly attributable transaction costs.
FINANCIAL ASSETS
All regular way purchases and sales of financial assets are recognised on the trade date (i.e. the date that the Group commits to
purchase or sell the asset). Regular way purchases or sales are those that require delivery of assets within the period generally
established by regulation or convention in the marketplace.
The Group has not designated any financial assets as at fair value through profit or loss (FVTPL).
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.
Such assets are carried at amortised cost using the effective interest method. Gains and losses are recognised in income when the
loans and receivables are derecognised or impaired along with the amortisation process.
Other
Other non-derivative financial instruments are measured at amortised cost using the effective interest method less any impairment losses.
FINANCIAL LIABILITIES
Trade and other payables
Trade and other payables are recognised and initially measured at cost. Subsequently, instruments with a fixed maturity are 
re-measured at amortised cost using the effective interest rate method. Amortised cost is calculated by taking into account any
transaction costs and any discount or premium on settlement. Financial liabilities which do not have a fixed maturity are subsequently
carried at fair value.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 35
Interest bearing loans and borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction
costs. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective
interest method. Gains and losses are recognised in the income statement when the liabilities are derecognised as well as through the
amortisation process.
IMPAIRMENT OF FINANCIAL ASSETS
The Group assesses at each reporting date whether a financial asset or group of financial assets is impaired.
Assets carried at amortised cost
If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has been incurred, the
amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future
cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest
rate (i.e. the effective interest rate computed at initial recognition). The carrying amount of the asset is reduced either directly or
through use of an allowance account. The amount of the loss is recognised in the income statement. The Group first assesses
whether objective evidence of impairment exists individually for financial assets that are individually significant, and individually or
collectively for financial assets that are not individually significant. If it is determined that no objective evidence of impairment exists
for an individually assessed financial asset, whether significant or not, the asset is included in a group of financial assets with similar
credit risk characteristics and that group of financial assets is collectively assessed for impairment. Assets that are individually
assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a collective
assessment of impairment. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be
related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is
reversed. Any subsequent reversal of an impairment loss is recognised in the income statement to the extent that the carrying value
of the asset does not exceed its amortised cost at the reversal date.
2.22 REVENUE RECOGNITION
Revenue comprises the fair value of the consideration received or receivable for the sale of goods or services in the ordinary course
of the Group’s activity. Revenue is shown net of value added tax, returns, rebates and discounts and after eliminating sales within
the Group. The Group recognises revenue when the amount of the revenue can be readily measured, it is probable that future
economic benefits will flow to the entity and when specific criteria have been met for the Group’s activity as described below. The
amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The
Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the
specifics of each arrangement.
(a) Sales of goods
The Group produces and sells a range of arable crops. Sales of goods are recognised when a Group entity has delivered products to
the purchaser, the purchaser has full discretion over the channel and price to sell the products, and there are no unfulfilled obligations
that could affect the purchaser’s acceptance of the products. Delivery does not occur until the produce has been delivered to the
specified location, the risks of obsolescence and loss have been transferred to the purchaser, and either the purchaser has accepted
the produce in accordance with the sales contract, the acceptance provisions have lapsed, or the Group has objective evidence that
all criteria for acceptance have been satisfied.
(b) Sales of services
Revenue from time and materials contracts is recognised at the contractual rates as labour hours are delivered and direct expenses
incurred. Revenue from fixed price contracts is recognised under the percentage of completion method and is based on the services
performed to date as a percentage of the total services to be performed.
If circumstances arise that may change the original estimates of revenues, costs or extent of progress towards completion, estimates are
revised. These revisions may result in increases or decreases in estimated revenues or costs and are reflected in income in the period in
which the circumstances that give rise to the revision become known to management.
(c) Interest income
Interest income is accrued on a time basis by reference to the principal outstanding and at the effective interest rate applicable, which
is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net
carrying amount.
2.23 COMPARATIVES
The comparative period represents the 10 month period from 1 January 2009 to 31 October 2009 and is therefore not directly
comparable to the year to 31 October 2010 which is being reported on in these financial statements. 36 Landkom International Plc Annual Report 2010
3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the circumstances.
3.1 CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
In preparing the financial statements the Group must select and apply various accounting policies which are described in Note 2. In
order to apply our accounting policies the Group makes estimates and judgements concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
(a) Biological assets
Biological assets (living crops) are measured at their fair value at each reporting date. The fair value of biological assets is determined
based among other estimates on weather conditions, growth potential, harvesting, price development and discount rate. Changes in
any estimates could lead to recognition of significant fair value changes in the statement of comprehensive income. Where little
biological transformation has taken place the Group uses cost as an approximation for fair value.
(b) Deferred income tax assets
Management regularly assesses the likelihood that deferred tax assets will be recovered from future taxable income. No deferred tax
asset is recognised when Management believe that it is more likely than not that a deferred asset will not be realised.
(c) Provision for impairment of trade receivables
An allowance is made for doubtful trade receivables. This allowance represents Management’s estimate of accounts receivable that,
subsequent to the time of sale, may be of doubtful collectability because customers may not be able to pay.
(d) Share based payments
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the
date at which they are granted. Estimating fair value requires determining the most appropriate valuation model for a grant of equity
instruments, which is dependent on the terms and conditions of the grant. This also requires determining the most appropriate inputs to
the valuation model including the expected life of the option, volatility and dividend yield and making assumptions about them. The
assumptions and model used are disclosed in note 22.
(e) Going concern
The Group is required to assess whether it has sufficient resources to continue its operations and to meet its commitments for the
foreseeable future. Going concern is assessed applying cash flow forecasting and estimate based on management’s expectations
and knowledge of the company and its operating environment. Should the going concern assumption no longer remain valid the
carrying value of the Group’s assets will need to be assessed for impairment and the balance sheet will need to be prepared on a
break-up basis. In carrying out the Group’s assessment of going concern key estimates are made on forecast harvest yields and crop
sales prices.
4. FINANCIAL RISK MANAGEMENT
4.1 FINANCIAL RISK FACTORS
The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk),
credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and
seeks to minimise potential adverse effects on the Group’s financial performance.
Risk management is carried out by the key management personnel under policies approved by the Board. Group treasury identifies,
evaluates and hedges financial risks in close co-operation with operational management. The Board provides written principles for
overall risk management, as well as written policies covering specific areas such as foreign exchange risk, cash flow and fair value
interest rate risk, credit risk and liquidity risk.
(a) Foreign exchange risk
The Group is exposed to currency risk on sales, purchases and cash deposits that are denominated in a currency other than the
respective functional currencies of the Group. Operating currencies for the Group are primarily the Ukrainian Hryvnya, pounds sterling
and US dollars.
The Group’s local Ukrainian production costs such as salaries are denominated in Hryvnya. Input costs such as seed, fertiliser and
chemicals along with sales proceeds are denominated in Hryvnya but a majority have an underlying link to international commodity
prices which are denominated in US dollars. The majority of the Group’s trade receivables and payables are denominated in Hryvnya
with a link to US dollars. Due to this link the Group has selected US dollars as the functional currency of its main operating subsidiary in
Ukraine. Strengthening or weakening of the Ukrainian Hryvnya would respectively increase or decrease the local production costs in US
dollar terms. Foreign exchange gains and losses would also be recognised on certain payables and receivables.
The National Bank of Ukraine (NBU) manages and determines the official exchange rates. An inter-bank market for exchange of
currencies exists in Ukraine and is monitored by the NBU. The Group, through its financial institutions, exchanges currencies at bank
offered market rates.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 37
During the year to 31 October 2010, the Ukrainian Hryvnya/US Dollar exchange rate fluctuated between a maximum and minimum of
8.25 and 7.88 Hryvnya to US$1 (10 months to 31 October 2009: 9.38 to 7.56).
The Group’s holding company incurs costs and has raised equity funds in pounds sterling which is its functional currency. The holding
company also maintains the Group treasury funds. As the majority of the Group’s operational costs are US dollars, treasury funds are
also held in US dollars. This creates a non-operational foreign exchange risk.
During the year to 31 October 2010 the Pound Sterling/US Dollar exchange rate has fluctuated between a maximum and minimum of
0.70 and 0.59 Pounds Sterling to US$1 (10 months to 31 October 2009: 0.73 to 0.59).
The Group’s exposure to foreign currency risk was as follows:
POUNDS UKRAINE
STERLING EURO HRYVNYA US DOLLAR TOTAL
$000 $000 $000 $000 $000
As at 31 October 2010
Trade receivables –– 586 – 586
Other receivables –– 595 – 595
Trade payables – (1,098) (2,346) (2,222) (5,666)
Accruals and other payables – (12) (837) (62) (911)
Other financial liabilities –– (54) – (54)
Cash and cash equivalents –– 809 – 809
Total – (1,110) (1,247) (2,284) (4,641)
As at 31 October 2009
Trade receivables –– 401 – 401
Other receivables 132 – 152 – 284
Trade payables (468) (7) (3,109) – (3,584)
Accruals and other payables (710) (12) (2,572) – (3,294)
Other financial liabilities – (825) (113) – (938)
Cash and cash equivalents 13 – 209 – 222
Total (1,033) (844) (5,032) – (6,909)
The following table demonstrates the sensitivity to a reasonably possible change in exchange rates, with all other variables held
constant, of the Group’s profit before tax and equity:
EFFECT ON EQUITY AND EFFECT ON EQUITY AND
PROFIT BEFORE TAX PROFIT BEFORE TAX
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
10% strengthening of foreign currency against functional currency (464) (691)
10% weakening of foreign currency against functional currency 464 691
(b) Price risk
The majority of the Group’s revenues and finished goods inventories are exposed to commodity price risk of the arable crops that it
produces. The Group’s production costs are exposed to oil and gas commodity prices. To manage its price risk arising from fluctuations
in crop prices, the Group may enter into forward off-take contracts or commodity options.
The following table shows sensitivity to changes in commodity prices:
EFFECT ON EQUITY AND EFFECT ON EQUITY AND
PROFIT BEFORE TAX PROFIT BEFORE TAX
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
10% increase in crop price 1,948 1,232
10% increase in fertiliser price (405) (703)
10% increase in oil price (241) (227)
10% increase in chemical price (389) (430)
913 (128) 38 Landkom International Plc Annual Report 2010
4.1 FINANCIAL RISK FACTORS CONTINUED
(c) Cash flow and fair value interest rate risk
At certain points in time the Group has significant interest-bearing assets and the Group’s income and operating cash flows are
partially dependent on changes in market interest rates.
The Group’s interest rate risk arises from short-term deposits, the maximum balance of such deposits during the year amounted to $15.5 million.
The Group’s trade receivable and payable balances are noninterest-bearing and are not guaranteed or underwritten. These amounts
are presented in notes 18 and 26 respectively.
The Group has finance lease agreements which bear interest as detailed in note 24.
(d) Credit risk
Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents and deposits with banks, as well as credit
exposures to customers including outstanding receivables and committed transactions.
The Group’s maximum exposure to credit risk, after taking into account allowances for un-recoverability, is the fair value of the relevant
assets as follows:
2010 2009
$000 $000
Trade receivables 377 401
Receivables due from related parties 1,920 –
Cash and cash equivalents 2,341 222
4,638 623
The Group does not hold any collateral as security.
The Directors consider that the carrying amount of trade receivables approximates to their fair values.
The following table shows the Group’s receivables at the reporting date that are subject to credit risk and the ageing and impairment
profile thereon:
RECEIVABLES RECEIVABLES
PAST DUE TOTAL NOT DUE
TOTAL AND UN-IMPAIRED AND NOT LESS THAN 45 – 90 OVER 90
RECEIVABLE IMPAIRED RECEIVABLE IMPAIRED 45 DAYS DAYS DAYS
$000 $000 $000 $000 $000 $000 $000
31 October 2010
Trade receivables 625 248 377 4 117 – 256
Receivables due from related parties 2,592 672 1,920 1,430 –– 490
Other receivables 47 – 47 7– 40
3,264 920 2,344 1,441 117 – 786
31 October 2009
Trade receivables 401 – 401 – 381 – 20
Receivables due from related parties 649 649 –––––
Other receivables 74 – 74 10 –– 64
1,124 649 475 10 381 – 84
For customers, an assessment of the credit quality of the customer is made, taking into account its financial position, past experience
and other factors.
Trade receivables classed as neither past due nor impaired are from customers the Group has significant trading history with, and are
classed by management as credit worthy.
In assessing the recoverability of receivables the Group takes into account factors such as credit ageing, the financial position of the
counterparty and past experience.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 39
For term deposits with banks and financial institutions, only independently rated parties with a minimum rating of ‘A’ are accepted. The
table below shows the major cash and cash equivalent banking deposits at the reporting date.
BALANCE AT BALANCE AT
31 OCTOBER 2010 31 OCTOBER 2009
RATING $000 RATING $000
Barclays Private Clients Bank Int AA– 332 AA– 10
Barclays Bank PLC A-1+ 43
Laiki Popular Bank Cyprus BBB+ 11 BBB 2
Raiffeisen Bank Aval – 1,955 ––
Ukraine Export Import Bank –– – 210
2,341 222
Balances held with Laiki Popular Bank Cyprus, Raiffeisen Bank Aval and Ukraine Export Import Bank were for operational purposes only
with no term deposits being placed.
(e) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding.
Management monitors the Group’s rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flow.
The table below analyses the Group’s financial liabilities on a contractual gross undiscounted cash flow basis into maturity groupings
based on maturity as at the reporting date.
TOTAL LESS THAN 3 6 MONTHS TO GREATER THAN
$000 MONTHS 3 – 6 MONTHS 1 YEAR 1 YEAR
31 October 2010
Finance leases 54 22 11 21 –
Trade and other payables 12,517 12,517 –– –
Borrowings 58 58 –– –
Total financial liabilities 12,629 12,597 11 21 –
31 October 2009
Finance leases 938 851 7 14 66
Trade and other payables 5,034 5,034 –– –
Total financial liabilities 5,972 5,885 7 14 66
Sufficient cash is expected to be generated through the Group’s operating cycle, bank working capital finance, and effective cash
management to meet the contractual cash flows disclosed above. Risks in relation to cash management and financing are discussed
in note 2.1.
(f) Agricultural risk
The Group’s operations are in western, central and southern regions of Ukraine. This geographical spread of operations lowers the
Group’s weather risk. Crop management and machinery investment strategies further mitigate the remaining risk.
The primary risk in the western region is wet weather during harvest and growing season. In order to mitigate this risk the Group is
progressively investing in grain drying facilities, crop protection machinery and in its own, as opposed to contracted, harvesting
machinery.
The primary risk in the central region is drought. The Group manages this risk by planting crops which have greater resistance to lower
levels of rainfall.
The primary risk in the southern region is drought. The Group inherited irrigation infrastructure when it acquired its land in the southern
region. Much of this equipment requires refurbishment which the Group intends to carry out in order to minimize the risk of drought.
Winter temperatures in Ukraine are often significantly below zero. In order to manage the winter kill risk, the Group times its autumn
planting and uses appropriate crop protection chemicals to achieve the desired amount of pre winter crop development.
The Group has developed a crop rotation plan to ensure that its cultivations are sustainable, crop diseases and pests are managed,
and chemical and fertilizer applications can be minimized.
Agricultural risk can impact the quantity and quality of goods harvested from the Group’s land. This will have a direct and equal
impact on the Group’s revenue. A 10% reduction or increase in yield will have 10% impact on overall revenue from harvested goods. 40 Landkom International Plc Annual Report 2010
5. REVENUE
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Rapeseed 12,506 10,854
Wheat 1,815 2,962
Barley 181 159
Sunflower 1,387 –
Soybean 210 –
Other crop 176 –
Livestock related sales 53 69
Chemical and fertiliser sales 114 314
Sale of other goods 4–
Revenue from sale of goods 16,446 14,358
Revenue from provision of services 353 195
Total revenue 16,799 14,553
The Group earned revenues from two (2009: three) customers which represented more than 10% of the total group sales. The
aggregate amount of $13,025,000 was made up of $10,991,000 and $2,034,000 (2009: aggregate $7,457,000 made up of $2,180,000;
$2,038,000; $3,239,000).
The Group does not generate significant revenues from external customers attributable to the country of domicile. All sales during the
year were made in the Ukraine (2009: All sales made in Ukraine). The Group does not have any significant non-current assets that are
located in the country of domicile of the Group. The vast majority of the non-current assets are located in the Ukraine.
6. DIRECT COSTS
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Direct crop inputs (Seed, Fertiliser & Chemicals) 10,330 14,483
Agricultural produce purchased and resold 170 339
Fuel 2,411 2,274
Staff costs 2,822 3,988
Harvest, drying and storage 2,518 1,424
Maintenance 1,117 3,243
Land rental on cultivated land 1,275 756
Other land costs 1,310 2,210
Transportation 507 765
Agronomy 89 188
Security 156 226
Other direct costs 634 603
Movement in inventory and work in progress (7,252) (167)
16,087 30,332
Biological asset adjustment (see note 16) 2,919 (8,441)
19,006 21,891
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 41
7. ADMINISTRATIVE EXPENSES
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Staff costs
Wages, salaries and fees 2,049 1,675
Social security 358 202
Share based payments 580 394
Other staff costs 122 78
Travel and entertainment 374 325
Advertising and public relations 173 170
Communication 60 99
Office costs 191 209
Depreciation 210 135
Amortisation 19 80
IT 16 1
Legal 127 165
Auditor’s remuneration – see below 197 252
Other professional 338 350
Bank charges 97 87
Other administrative expenses 9 153
4,920 4,375
Amounts payable to Ernst & Young LLP and Baker Tilly UK Audit LLP in respect of both audit and non-audit services:
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Audit services:
Audit of annual financial statements 206 200
Review of interim results 16 16
Effect of over and under accruals (25) 36
Non audit services ––
197 252
8. OPERATING LOSS
Operating loss has been derived after the following:
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Gain/(loss) arising from changes in value of Biological asset (see note 16) 3,047 (8,509)
Direct costs
Operating leases – land 2,551 1,747
Administrative expenses
Operating leases – Buildings 79 70
Other operating income
Income from Ukrainian special agricultural VAT scheme 154 1,237
Other operating expense
Bad debt provision 248 –
Bad debt write off 42 –
Loss on disposal of assets 160 126
Fines and penalties 14 (61)
Loss on commodity option – 43
Unrecoverable VAT 236 107
700 215 42 Landkom International Plc Annual Report 2010
9. EXCEPTIONAL ITEMS
The following exceptional incomes/(expenses) have been included in the statement of comprehensive income:
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Gain on the acquisition of Morion Agro PP (see note 32) 103 –
Impairment of Ukrainian VAT receivable – (10,179)
Impairment of Podilia Kolodno – (530)
Provision against receivable from non-controlling interest – (309)
Provision against receivable from associate – (649)
Impairment of biological asset (see note 16) – (519)
Impairment of software intangibles (see note 15) – (202)
Impairment of property, plant and equipment (see note 14) – (2,117)
103 (14,505)
An impairment charge against Ukrainian VAT receivable was recognised in 2009 due to the difficulties the Group encountered in
recovering VAT from the Ukrainian authorities.
10. FINANCE INCOME
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Bank interest income on short-term deposits 88
88
11. FINANCE COSTS
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Interest expense on finance lease obligations 170 159
Over accrual of interest on payables – (93)
170 66
12. TAXATION
From incorporation on 10 April 2007 the Company has been resident in the Isle of Man, and is subject to Isle of Man taxation at the
standard rate of 0%. The tax charge for the year/period represents a payment on account of Ukraine tax liabilities, which the Group
does not believe are recoverable in the foreseeable future. There is no corporation tax charge in the prior period due to trading losses
incurred.
a) Tax charged/(credited) in the income statement
YEAR ENDED 10 MONTHS ENDED
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Current tax:
Charge for the year 76 20
Adjustments in respect of prior years 10 –
Total current income tax charge 86 20
Deferred tax:
Origination and reversal of temporary differences ––
Total deferred income tax charge ––
Total tax charge in the income statement 86 20
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 43
b) Reconciliation of the total tax charge/(credit)
YEAR ENDED 10 MONTHS
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Deferred tax expense relating to the origination and reversal of temporary differences ––
The tax charge for the year/period can be reconciled to the loss per
the statement of comprehensive income as follows:
Loss before tax (11,761) (42,106)
Tax at the Ukrainian corporate income tax rate of 25% (2,901) (10,527)
Non-deductible expenses 2,901 10,527
Loss carried forward ––
Income tax incurred in other jurisdictions 15 –
Irrecoverable payment on account 71 20
Tax expense for the year/period 86 20
See note 28 for deferred tax balances.
13. EARNINGS PER ORDINARY SHARE
Basic and fully diluted loss per share have been calculated on the loss after taxation for the year/period and the weighted average
number of ordinary shares in issue during the year/period.
Adjusted loss per share before amortisation of software intangible assets and share based payments charge has been presented in
addition to the basic earnings per share since, in the opinion of the Directors, this provides shareholders with a more appropriate
representation of the underlying earnings derived from the Group’s businesses.
2010 2009
NUMBER OF NUMBER OF
SHARES SHARES
Weighted average number of shares in issue 422,187,021 230,798,412
YEAR ENDED 10 MONTHS ENDED
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Loss after tax (11,418) (42,054)
Adjustments:
Amortisation of software intangible assets 19 80
Share based payments charge 580 394
Adjusted loss (10,819) (41,580)
Basic & fully diluted loss per ordinary share (US$ cents) (2.7) (18.2)
Adjusted basic loss per ordinary share (US$ cents) (2.6) (18.0)
Not included in the calculation of diluted earnings per share are share options. Share options could potentially dilute earnings per
share in future periods but were not included in the calculation as they were anti-dilutive in both periods. The inclusion of share options
would decrease reported loss per ordinary share.
14. PROPERTY, PLANT AND EQUIPMENT
FURNITURE,
VEHICLES & ASSETS UNDER FITTINGS &
LAND BUILDINGS MACHINERY CONSTRUCTION EQUIPMENT TOTAL
$000 $000 $000 $000 $000 $000
Cost
At 31 December 2008 79 4,512 40,284 8,236 521 53,632
Assets acquired through business
combinations –– 22 –2 24
Effect of exchange rate movements – 17 114 11 133
Additions – 124 39 1,106 35 1,304
Transfers – 370 33 (403) ––
Disposals – (48) (829) – (1) (878)
At 31 October 2009 79 4,975 39,663 8,940 558 54,215 44 Landkom International Plc Annual Report 2010
14. PROPERTY, PLANT AND EQUIPMENT CONTINUED
Assets acquired through business
combinations – 377 132 –– 509
Effect of exchange rate movements – 37 42 –– 79
Additions – 157 1,840 595 60 2,652
Transfers – 4,742 55 (4,797) ––
Disposals – (17) (1,148) – (29) (1,194)
At 31 October 2010 79 10,271 40,584 4,738 589 56,261
Accumulated depreciation
At 31 December 2008 – 100 5,002 – 193 5,295
Effect of exchange rate movements –– 162 –– 162
Depreciation charge – 351 5,890 – 107 6,348
Impairment charge –– 2,117 –– 2,117
Disposals –– (225) – (1) (226)
At 31 October 2009 – 451 12,946 – 299 13,696
Effect of exchange rate movements – 15 15 –– 30
Depreciation charge – 526 6,584 – 170 7,280
Disposals –– (600) – (18) (618)
At 31 October 2010 – 992 18,945 – 451 20,388
Net Book Value:
31 October 2010 79 9,279 21,639 4,738 138 35,873
31 October 2009 79 4,524 26,717 8,940 259 40,519
Depreciation expense of $210,000 has been charged to administrative expenses (2009: $135,000), and $7,070,000 to cost of sales
(2009: $6,213,000).
During 2009 management identified a group of farming equipment assets which it intended to sell in future periods. The carrying value
of these assets was assessed as significantly above the fair value less cost to sell. These assets were therefore written down to fair value
less cost to sell resulting in an impairment charge of $1,919,000 which was included with exceptional items in the 10 months ended
31 October 2009.
Included within property, plant and equipment are assets with a net book value of $22,000 which have been pledged as security
against bank loans (see note 25).
Several items of farming equipment could not be located when an asset count was carried out after the 2009 harvest. These assets
were therefore written down to nil value in use resulting in an impairment charge of $198,000 which was included within exceptional
items in the 10 months to 31 October 2009.
Assets under construction are comprised of the materials required for the construction of a silo complex, a flat storage site and farm
bases. Assets under construction will be completed when the group has sufficient financial resources.
Included in the net book value amount in respect of assets held under finance leases and similar hire purchase contracts are the following.
VEHICLES &
MACHINERY
$000
Net book value:
31 October 2010 114
31 October 2009 1,007
Depreciation charge in the year/period for these assets were:
31 October 2010 52
31 October 2009 188
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 45
15. INTANGIBLE ASSETS
SOFTWARE LAND LEASES TOTAL
$000 $000 $000
Cost at 31 December 2008 331 – 331
Effect of exchange rate movement 38 – 38
Cost at 31 October 2009 369 – 369
Effect of exchange rate movement (9) – (9)
Assets acquired through business combinations – 137 137
Corporate asset acquisitions – 81 81
Additions 3– 3
Cost at 31 October 2010 363 218 581
Accumulated amortisation
At 31 December 2008 51 – 51
Effect of exchange rate movement 9 –9
Amortisation charge 80 – 80
Impairment charge 202 – 202
At 31 October 2009 342 – 342
Effect of exchange rate movement (9) – (9)
Amortisation charge 19 – 19
At 31 October 2010 352 – 352
Net book value at:
31 October 2010 11 218 229
31 October 2009 27 – 27
During 2009 two software programs were identified as obsolete and are no longer in use. These assets were written down to nil value in
use, resulting in an impairment charge of $202,000 which was included within exceptional items for the period ending 31 October 2009.
16. BIOLOGICAL ASSETS
The Group’s interests in biological assets are held in its Ukraine subsidiaries.
The Group’s biological assets are made up of three distinct groups:
n Winter crops planted during the autumn of 2010 and due to be harvested in the summer of 201 1. Due to the insignificant amount of
biological transformation these crops are valued at cost.
n Spring crops planted in 2010 and due to be harvested within 1 month of the reporting date. These crops are accounted for at fair
value less estimated point of sale costs.
n Livestock biological assets which is made up mainly of beef and dairy cattle at a variety of ages. These animals are valued at fair
value less estimated point of sale costs.
The fair value of crop biological assets at each reporting date is determined based on the area planted and market prices at the
reporting date, and based on the crops’ location and condition, which includes estimates of biological transformation and yield
potential. Where little biological transformation has taken place the Group uses cost as an approximation for fair value.
The fair value of livestock biological assets at each reporting date is determined based on the lower of reporting date market value,
and discounted cash flow valuation.
Fair value is estimated on the basis of the present value of expected net cash flows, discounted at an appropriate risk adjusted pre-tax
discount rate. Changes in any estimates could lead to recognition of significant fair value changes in the profit or loss. 46 Landkom International Plc Annual Report 2010
16. BIOLOGICAL ASSETS CONTINUED
LIVESTOCK CROPS TOTAL
$000 $000 $000
Carrying value at 31 December 2008 49 13,309 13,358
Other biological asset additions 85 – 85
Cultivation costs relating to 2008/2009 crops – 13,693 13,693
Net change in fair value due to price, yield, maturity and cost changes – (8,509) (8,509)
Total 2008/2009 biological asset 134 18,493 18,627
Harvest of biological assets and transfer to inventory – (18,493) (18,493)
Cultivation costs relating to 2009/2010 crops – 4,483 4,483
Impairment charge – (519) (519)
Carrying value at 31 October 2009 134 3,964 4,098
Other biological asset additions 127 – 127
Cultivation costs relating to 2009/2010 crops – 16,882 16,882
Net change in fair value due to price, yield, maturity and cost changes (22) 3,069 3,047
Total 2009/2010 biological asset 239 23,915 24,154
Harvest of biological assets and transfer to inventory – (21,783) (21,783)
Cultivation costs relating to 2010/2011 crops – 5,255 5,255
Carrying value at 31 October 2010 239 7,387 7,626
Net change in fair value of biological assets for the year/period ended
31 October 2010 (22) 3,069 3,047
31 October 2009 – (8,509) (8,509)
Fair value adjustments recognised for each harvested crop:
CROP HARVESTED CROP HARVESTED DURING
DURING YEAR ENDED 10 MONTHS ENDED
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Reversal of fair value adjustment recognised in prior period – (68)
Fair value adjustment on harvested crop and livestock (note 6) 2,919 (8,441)
Fair value adjustment on un-harvested crop 128 –
Total biological asset fair value adjustment 3,047 (8,509)
The Group harvested the following produce:
Year ended 31 October 2010:
WINTER WINTER SPRING OTHER
RAPESEED WHEAT WHEAT MAIZE SOYA SUNFLOWER CROPS TOTAL
Saleable quantity of produce/MT 36,872 9,867 8,475 16,498 2,958 3,558 110 78,338
Area of land harvested (hectares) 14,615 3,278 2,797 3,304 1,813 2,349 335 28,491
Yield – MT/hectare 2.5 3.0 3.0 5.0 1.6 1.5 0.3
In addition to the above the Group’s Crimean associate harvested 2,882 hectares of land.
10 months ending 31 October 2009:
WINTER WINTER OTHER 
RAPESEED WHEAT BARLEY CROPS TOTAL
Saleable quantity of produce/MT 39,437 34,172 2,160 1,180 76,949
Area of land harvested (hectares) 14,630 9,244 600 1,097 25,571
Yield – MT/hectare 2.7 3.7 3.6 1.1
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 47
In the addition to the above the Group’s Crimean associate harvested 3,491 ha.
At the reporting date the Group had the following biological assets:
WINTER WINTER WINTER WINTER 
RAPESEED WHEAT BARLEY RYE MAIZE SOYA TOTAL
31 October 2010
Crop ready for harvest (Ha) –––– 2,749 137 2,886
Crop ready for harvest ($‘000) –––– 2,068 63 2,131
Crop for harvest in summer 2011 (Ha) 12,862 8,749 1,377 292 –– 23,280
Crop for harvest in summer 2011 ($‘000) 3,224 1,780 227 25 –– 5,256
31 October 2009
Crop ready for harvest (Ha) –––––––
Crop ready for harvest ($‘000) –––––––
Crop for harvest in summer 2010 (Ha) 11,740 4,005 –––– 15,745
Crop for harvest in summer 2010 ($‘000) 3,504 460 –––– 3,964
The following crops were cultivated but not harvested due to severe weather damage: winter rapeseed 521 ha (3% of total planted
rapeseed), winter wheat 727 ha (18%), maize 2,032 ha (25%), Soya 822 ha (30%), spring wheat 725 ha (21%), sunflower 636 ha (21%).
When not-harvested crop areas are included in the yield calculation the following yield results were achieved (tonnes per hectare):
winter rapeseed 2.4, winter wheat 2.5, spring wheat 2.4, maize 3.7, soya 1.1, sunflower 1.2.
During 2009, the Group planted 3,053 hectares of land which it subsequently established it did not have a legal right to cultivate. Due to
the uncertainty over the ownership of this biological asset an impairment charge of $519,000 was included within exceptional items for
the period ended 31 October 2009.
17. INVENTORIES
2010 2009
$000 $000
Raw materials 3,908 3,528
Work in progress 429 130
Finished goods 5,599 1,508
9,936 5,166
Raw materials consist of spare parts for property plant and equipment, agricultural chemicals and fertilisers.
Finished goods consist of harvested agricultural produce.
The value of inventory charged to the statement of comprehensive income amounts to $16,787,000 (2009: $18,673,000).
18. TRADE AND OTHER RECEIVABLES
2010 2009
$000 $000
Trade receivables 625 401
Receivables due from related parties 2,592 649
Prepayments 415 191
VAT recoverable 4,037 3,088
Other receivables 47 74
Allowance for un-collectability (920) (649)
Allowance for non-repayment of VAT (3,127) (3,069)
3,669 685
The carrying amounts of the Group’s trade and other receivables are denominated in the following currencies:
2010 2009
$000 $000
Pounds Sterling 136 132
United states dollars 1,177 –
Ukrainian Hryvnya 2,356 553
3,669 685 48 Landkom International Plc Annual Report 2010
18. TRADE AND OTHER RECEIVABLES CONTINUED
Movement in the allowance for un-collectability during the year was:
2010 2009
$000 $000
Opening balance 649 –
Recognition 248 649
Foreign currency translation 23 –
Closing balance 920 649
Movement in the allowance for Non repayment of VAT during the year was:
2010 2009
$000 $000
Opening balance 3,069 –
Recognition (4) 3,069
Foreign currency translation 62 –
Closing balance 3,127 3,069
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group
does not hold any collateral as security.
The Directors consider that the carrying amount of trade receivables approximates to their fair values.
19. CASH AND CASH EQUIVALENTS
2010 2009
$000 $000
Cash at bank and on hand 2,341 222
Short-term deposits ––
2,341 222
Cash and cash equivalents include the following for the purposes of the cash flow statement:
2010 2009
$000 $000
Cash and cash equivalents 2,341 222
20. CALLED UP SHARE CAPITAL
The total available for issue share capital of the Company as at the reporting date is as follows:
2010 ORDINARY 2009 ORDINARY
SHARES SHARES
Number of shares of £0.001 each:
Available for issue 600,000,000 500,000,000
Allotted and fully paid 435,008,935 240,008,935
$000 $000
Allotted and fully paid ordinary shares of £0.001 each 789 466
The issued share capital has been increased as follows:
SHARE CAPITAL
DATE NUMBER OF SHARES ISSUE PRICE $000
At 31 December 2008 200,008,935 411
11 March 2009 40,000,000 12.0p 55
At 31 October 2009 240,008,935 466
24 November 2009 195,000,000 5.0p 323
At 31 October 2010 435,008,935 789
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 49
21. SHARE PREMIUM ACCOUNT
2010 2009
$000 $000
At start of year/period 144,349 137,814
Premium on shares issued during the year/period 15,832 6,575
Share issue costs (831) (40)
159,350 144,349
During the year ended 31 October 2010 the Group issues 195,000,000 new shares at 5 sterling pence per share. Gross proceeds of
$16,155,000 were received. Share issue costs amounted to $831,000 resulting in net proceeds of $15,324,000.
During the 10 month period ended 31 October 2009 the Group issued 40,000,000 new shares at 12 sterling pence per share. Gross
proceeds of $6,630,000 were received.
22. SHARE BASED PAYMENTS
UNAPPROVED COMPANY SHARE OPTION PLAN (THE PLAN)
The only share option scheme operated by the Company during the period was the Unapproved Share Option Plan established on
22 November 2007. Options granted under the Plan become exercisable following the first, second or third anniversary of the date of
the grant, and once vested may be exercised up to the fifth anniversary of the date of vesting. There are no performance conditions
attaching to the awards. Further details are provided in the Remuneration Report.
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, share options under the
Plan during the period.
2010 2010 WAEP 2009 2010 WAEP
$000 (PENCE) $000 (PENCE)
Outstanding at start of year/period 9,380,754 38 18,754,958 52
Granted 18,637,679 7 2,882,104 17
Surrendered –– (2,775,059) 85
Forfeited (4,027,306) 42 (9,481,249) 49
Outstanding at end of year/period 23,991,127 13 9,380,754 38
Exercisable at end of year/period 3,726,170 37 4,152,038 45
No options were exercised during the year to 31 October 2010 (2009: Nil).
Options outstanding at 31 October 2010 had exercise prices of 6.75p to 78p (2009: 17p to 86p) and average contractual life of 5.72
years (2009: 5.44 years).
Options were valued using the binomial option pricing model, but adjusted to model the particular features of the options. The
principal inputs to the valuation model for the awards were:
AWARD DURING AWARDS DURING
YEAR ENDED 10 MONTHS ENDED
31 OCTOBER 2010 31 OCTOBER 2009
Risk free interest rate 1.3% – 2.2% pa 2.1 – 3.4% pa
Expected volatility 70% pa 70% pa
Dividend yield 0% pa 0% pa
Employee turnover 0% pa 0% pa
The fair value incorporates a number of factors, including the expected effects of early exercise due to employees leaving service after
the awards have vested or simply wishing to cash in their options upon exercise.
Expected volatility was determined by calculating the historical volatility of share prices for a group of comparable companies over a
period commensurate with the expected lifetime of the awards.
The weighted average fair value of the options awarded in 2010 valued in accordance with IFRS 2 was 3.8p and the weighted average
expected life from grant date was 7.0 years.The Group recognised a total expense of $580,000 (2009: $394,000) in respect of the Plan. 50 Landkom International Plc Annual Report 2010
22. SHARE BASED PAYMENTS CONTINUED
SHARE BASED PAYMENT RESERVE
2010 2009
$000 $000
At start of year/period 1,776 2,754
Transfer to retained earnings for forfeited shares (646) (1,372)
Charged to statement of comprehensive income 580 394
At end of year/period 1,710 1,776
23. FOREIGN EXCHANGE RESERVE
2010 2009
$000 $000
At start of year/period (6,176) (7,894)
Currency translation differences (840) 1,718
At end of year/period (7,016) (6,176)
24. OTHER FINANCIAL LIABILITIES
2010 2009
$000 $000
Present value of finance lease liabilities:
Within one year 54 872
Between two and five years – 66
54 938
The Group’s finance leases bear fixed interest rates set at between 51% and 76% and are denominated in the following currencies:
2010 2009
$000 $000
Euro – 825
Hryvnya 54 113
54 938
Finance leases are secured against those assets to which the finance leases relate.
25. BORROWINGS
As at 31 October 2010 the Group had two bank loans amounting in aggregate to $58,000 (2009: nil) with Ukrainian banks denominated
in Ukrainian Hryvnya. Interest on the loans is at a fixed rate of between 16% and 25%. Both loans are scheduled for repayment within
6 months of the year end. The loans are secured on property plant and equipment with a carrying amount of $22,000. 
26. TRADE AND OTHER PAYABLES
2010 2009
$000 $000
Trade payables 3,013 3,308
Trade payables due to related parties 6,218 346
Employee liabilities 402 847
Social security and other taxes 378 170
Accrued expenses and deferred income 2,671 1,618
Other payables 543 376
13,225 6,665
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 51
The Directors consider that the carrying amount of trade payables approximates to their fair value. Trade payables are on normal
commercial credit terms ranging from 30 days to 210 days.
Trade payables, including amounts due to related parties, become due as follows:
2010 2009
$000 $000
0 – 3 months 9,231 3,295
3 – 6 months ––
Over 6 months – 359
9,231 3,654
27. FINANCIAL INSTRUMENTS RECOGNISED IN THE STATEMENT OF FINANCIAL POSITION
A. AT 31 OCTOBER 2010
LOANS AND OTHER
RECEIVABLES/PAYABLES TOTAL
$000 $000
Current financial assets
Trade and other receivables 2,344 2,344
Cash and cash equivalents 2,341 2,341
Total financial assets 4,685 4,685
Current financial liabilities
Trade and other payables 12,517 12,517
Obligations under finance leases 54 54
Borrowings 58 58
Total financial liabilities 12,629 12,629
B. AT 31 OCTOBER 2009
LOANS AND OTHER
RECEIVABLES/PAYABLES TOTAL
$000 $000
Current financial assets
Trade and other receivables 475 475
Cash and cash equivalents 222 222
Total financial assets 697 697
Current financial liabilities
Trade and other payables 5,034 5,034
Obligations under finance leases 872 872
Non-current financial liabilities
Obligations under finance leases 66 66
Total financial liabilities 5,972 5,972
28. DEFERRED INCOME TAX
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset the current tax assets against
current tax liabilities and the deferred income taxes relate to the same tax levied by the same fiscal authority.
As at 31 October 2010 the Group had a potential unrecognised deferred tax asset of $1,673,000 (2009: $3,681,000) relating to trading
losses available to carry forward. Due to uncertainty of future recoverability of tax losses, the Directors’ view is that this asset will not be
realised and is therefore not recognised in these financial statements.
As at 31 October 2010 and 31 October 2009 the Group had no deferred tax liabilities. 52 Landkom International Plc Annual Report 2010
29. DIRECTORS AND EMPLOYEES
YEAR ENDED 10 MONTHS ENDED 
31 OCTOBER 2010 31 OCTOBER 2009
$000 $000
Staff costs during the year/period were as follows:
Wages, salaries and fees 4,143 5,027
Social security costs 1,086 838
Termination benefits ––
Share based payments 580 394
5,809 6,259
The average number of employees during the year/period was:
Directors 56
Administration 108 84
Operatives 610 658
723 748
Total number of employees at year/period end 717 624
Total amount for Directors’ remuneration and other benefits was as follows:
Emoluments for Directors’ services – fees and salaries 696 667
The emoluments of the highest paid Director were $257,000 (2009: $169,000).
30. COMMITMENTS AND CONTINGENCIES
OPERATING LEASE COMMITMENTS – GROUP AS A LESSEE
The Group leases parcels of land under non-cancellable operating leases. The lease expenditure charged to the statement of
comprehensive income during the year / period is disclosed in Note 8. 
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
2010 2009
$000 $000
Registered land leases:
No later than 1 year 1,994 725
Later than 1 year and no later than 5 years 6,592 2,901
Later than 5 years 9,211 5,449
17,797 9,075
Other operating leases – buildings:
No later than 1 year – 26
Later than 1 year and no later than 5 years –2
– 28
Tax and other regulatory compliance
Ukrainian legislation and regulations regarding direct and indirect taxation continue to evolve. The legislation and regulations in force
are new and untested. The interpretation of the legislation tend to be subject to varying interpretations and inconsistent enforcement by
local, regional and national authorities, and other Government bodies.
The uncertainty of application and the evolution of Ukrainian tax laws, including those affecting cross border transactions, create a risk
of additional tax payments having to be made by the Group, which could have a material effect on the Group’s financial position and
results of operations. The Group does not believe that these risks are any more significant than those of similar enterprises in the Ukraine.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 53
31. SUBSIDIARIES
The subsidiaries included in these financial statements are as follows:
COUNTRY OF PERCENTAGE
INCORPORATION ACTIVITY OF OWNERSHIP
Held at 31 October 2009:
Charmaine Investments Ltd Cyprus Holding company 100.0%
LK Ukraine Group LLC Ukraine Farm operations 100.0%
Landkom UA LLC Ukraine Farm operations 100.0%
Landkom Services Ltd England & Wales Admin services 100.0%
Bio Invest LLC Ukraine Land lease holding 100.0%
Radalan land LLC Ukraine Land lease holding 100.0%
Velych LLC Ukraine Land lease holding 80.0%
Kozatskyi Kurin’ LK LLC Ukraine Land lease holding 80.0%
Druzbha LLC Ukraine Farm operations 100.0%
Landkom Krym Ukraine Farm operations 100.0%
Yasnaya Polyana Ukraine Farm operations 88.8%
Romaniv Agro LLC Ukraine Land lease holding 100.0%
Dobrosyn LLC Ukraine Farm operations 100.0%
Nazalezhnist PP Ukraine Land lease holding 100.0%
Landkom Ukraine PP Ukraine Land lease holding 100.0%
Podilia Kolodno Ukraine Farm operations 61.0%
Formed during the year:
Landkom Assets Management LLC Ukraine Management 100.0%
Landkom Symoniv LLC Ukraine Farm operations 100.0%
Landkom Centre LLC Ukraine Farm operations 100.0%
Acquired during the year:
Morion Agro PP Ukraine Farm operations 100.0%
Gostcha AI PP Ukraine Land lease holding 100.0%
The acquisition of Morion Agro PP was classified as a business combination and is described in note 32. In the view of the Directors the
acquisition of Gostcha AI PP does not satisfy the definition of a business combination as defined by IFRS 3 and consequently this
acquisition has been treated as an asset purchase and included in property, plant and equipment at the cost to the Group.
32. BUSINESS COMBINATIONS
On 2 September 2010 the Group acquired 100% of the share capital of Morion Agro PP, a Ukrainian farming entity for cash
consideration of $197,000. The acquisition was made in order to expand the Group’s land bank and take control of assets.
The following assets were acquired and liabilities assumed at the date of acquisition:
$000
Current assets
Cash and cash equivalents 4
Inventories 6
Non-current assets
Intangible assets 137
Property, plant and equipment 509
Current liabilities
Trade and other payables (273)
Borrowings (83)
300
The following negative goodwill arose on the acquisition and is included within exceptional items in the statement of comprehensive income:
$000
Consideration transferred 197
Less: fair value of identifiable net assets acquired 300
Negative goodwill arising on acquisition 103 54 Landkom International Plc Annual Report 2010
32. BUSINESS COMBINATIONS CONTINUED
A gain arose on the acquisition because the acquiree vendors did not recognise the fair value of the identifiable assets which was
judged by independent valuers to be significantly above book value. The gain recognised on acquisition is not expected to be
taxable. The Directors are satisfied that the fair value of the assets acquired appear fairly stated resulting in the gain on acquisition.
The following net cash outflow occurred on acquisition of subsidiaries:
$000
Consideration paid in cash 197
Less: cash and cash equivalent balance acquired (4)
193
Included within the loss for the year is a loss of $13,720 attributable to Morion Agro PP. Revenue for the period includes $1,787 of income
attributable to Morion Agro PP. 
Had the business combination been effected on 1 November 2009 the revenue for the Group would have been $16,830,000 and loss
for the year would have been $1 1,685,000. 
33. RELATED PARTY TRANSACTIONS
A. The remuneration of the Directors and management, who are the key management personnel of the Group, is set out below in
aggregate for each of the categories specified in IAS 24 ‘Related Party Disclosures’.  Further information about the remuneration of
individual Directors is provided in the Directors’ Remuneration Report on pages 19 to 21.
2010 2009
$000 $000
Short-term employee benefits 1,092 667
Share-based payment charge 580 718
1,672 1,385
B. Vitaliy Skotsyk, CEO of the Group, is also a director of Amaco Ukraine. As explained in note 2.1 the Group receives continuing financial
support from Amaco Ukraine in its role as a major supplier through the provision of extended credit terms. The following transactions
were carried out after the related party relationship was formed:
2010 2009
$000 $000
Sale of agricultural commodities 10,979 –
Sale of machinery 364 –
Purchase of agricultural equipment 1,307 –
Purchase of crop inputs and machinery parts 9,682 –
Purchase of legal, financial, agronomy and other services 459 311
At the end of the year/period the following amounts were receivable and payable to Amaco Ukraine:
2010 2009
$000 $000
Receivable 1,266 –
Payable 6,218 346
Internal controls are in place to ensure that transactions with Amaco Ukraine are at arm’s length. These procedures involve the
requirement for a full tender for any material purchase or sale. In addition the Group requires that more than one Executive
Director approve transactions with Amaco Ukraine. The Board is informed of all commercial transactions with Amaco Ukraine on a
monthly basis.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED Landkom International Plc  Annual Report 2010 55
C. The Group made loans and sold goods and services to an associate company (Dokychaevskyy Cooperative) during the year/period:
2010 2009
$000 $000
Total value of sales to Dokychaevskyy Cooperative during the year/period 146 21
Trade receivable at reporting date 290 133
Loan receivable at reporting date 782 516
Provision against trade receivable and loan receivable (672) (649)
Net receivable from Dokychaevskyy Cooperative 400 –
34. EVENTS AFTER THE REPORTING DATE
On 22 March 201 1 the Group signed a loan agreement with Raiffeisen Bank Aval for the provision of $9 million of working capital finance. 
35. MANAGEMENT OF CAPITAL
The Group’s objectives when managing capital is:
n To maintain the entity’s ability to continue as a going concern, so that it can provide a return for shareholders. 
The Group sets the amount of capital in proportion to risk. The Group manages the capital structure and makes adjustments to it in the
light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital
structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares, obtain
or increase debt, or sell assets to reduce debt. Management consider capital to be net assets. 56 Landkom International Plc Annual Report 2010
REGISTERED OFFICE AND ADVISORS
REGISTERED OFFICE UK ADMIN OFFICE BROKER LEGAL ADVISERS
Landkom International PLC c/o Landkom Services Ltd. Liberum Capital Limited Eversheds LLP
11 Hope Street 11 Old Jewry Ropemaker Place, Level 12 1 Wood Street
Douglas IM1 1AQ 7th Floor 25 Ropemaker Street London EC2V 7WS
Isle of Man London EC2R 8DU London EC2Y 9AR United Kingdom
United Kingdom United Kingdom United Kingdom
Tel: +44 (0)20 7262 690
UKRAINIAN MANAGEMENT NOMINATED ADVISER AUDITORS PUBLIC RELATIONS
OFFICE ADVISERS Liberum Capital Limited Ernst and Young LLC College Hill
2 Brovarska Str. Ropemaker Place, Level 12 Rose House The Registry
Prolisky Vil. 25 Ropemaker Street 51-59 Circular Road Royal Mint Court
Borispol district London EC2Y 9AR Douglas London EC3N 4QN
Kiev region United Kingdom Isle of Man United Kingdom
Ukraine 08322 IM1 1AZ LANDKOM IS A SCALE PRODUCER OF
AGRICULTURAL CROPS FOR SUPPLY 
TO THE GLOBAL FOOD AND BIODIESEL
MARKETS. WE INTEND TO PROFITABLY 
USE WESTERN FARMING TECHNIQUES 
AND TECHNOLOGIES IN THE FERTILE 
LAND OF UKRAINE AND DELIVER RETURNS
TO SHAREHOLDERS WHILST ADHERING 
TO THE HIGHEST STANDARDS OF
CORPORATE GOVERNANCE.
01 HIGHLIGHTS
02 WHERE WE OPERATE
04 OUR BUSINESS
05 MARKET OVERVIEW
06 CHAIRMAN’S STATEMENT
08 CHIEF EXECUTIVE OFFICER’S REVIEW
12 CHIEF FINANCIAL OFFICER’S REVIEW
14 BOARD OF DIRECTORS
15 DIRECTORS’ REPORT
17 CORPORATE GOVERNANCE STATEMENT
19 REMUNERATION REPORT
22 STATEMENT OF DIRECTORS’ RESPONSIBILITIES
23 INDEPENDENT AUDITOR’S REPORT
24 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
25 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
26 CONSOLIDATED CASH FLOW STATEMENT
27 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
28 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
56 REGISTERED OFFICE AND ADVISORS
Landkom International Plc Annual Report 2010 REPORT AND ACCOUNTS 2010
LANDKOM.COM
LANDKOM INTERNATIONAL PLC, 11 HOPE STREET, DOUGLAS IM1 1AQ, ISLE OF MAN
TEL: +44 (0)20 7726 2690 EMAIL: INFO@LANDKOM.COM  INVESTORS@LANDKOM.COM
Landkom International Plc  Annual Report 2010