Brødrene A & O Johansen A/S : AO - Q1 2022

Interim Financial Report for the Period

1 January - 31 March 2022

Brødrene A & O Johansen A/S

Rørvang 3 * DK-2620 Albertslund * Denmark

Tel: [phone] * Fax: [phone] *www.ao.dk

CVR (Central Business Register) No.: 58 21 06 17

Company Announcement No. 9/2022

1/17

Contents

Highlights for the first quarter of 2022 ......................................................................... page 3

Financial and operating data for the AO Group .......................................................... page 5

Management's review ................................................................................................ page 6-8

Company announcements in 2022 ............................................................................. page 9

Management's statement .......................................................................................... page 10

Income statement and statement of comprehensive income ..................................... page 11

Balance sheet ............................................................................................................ page 12-13

Cash flow statement ................................................................................................... page 14

Statement of changes in equity .................................................................................. page 15

Notes .......................................................................................................................... page 16-17

Today the Board of Directors has approved the Group's interim financial report for the period 1 January - 31 March 2022.

Highlights for the first quarter of 2022

• • Consolidated revenue for the first quarter of 2022 was DKK 1,251.3 million, which is DKK 20.8 million, or 1.7%, more than for the first quarter of 2021. Compared to last year a growth of 10.3% was realised within the B2B segment, while the B2C segment decreased by 32.8% compared to 2021. Online trading was exceptionally high in the first quarter of 2021 as it was driven by the COVID-19 pandemic and the subsequent temporary closures of DIY stores. Revenue from the B2C segment was 26.0% higher than in the first quarter of 2020.

• • Compared with the first quarter of 2021, the gross profit margin for the first quarter of 2022 increased by 0.2 percentage point. The gross margin was negatively affected by the lower share of B2C revenue compared with the same period last year, while reduced distribution costs and price increases resulted in the overall development being positive.

• • EBITDA for the first quarter of 2022 totalled DKK 110.8 million, corresponding to an EBITDA margin of 8.9%, against DKK 107.9 million and 8.8% for the first quarter of 2021.

• • Profit before tax (EBT) for the first quarter of 2022 was DKK 85.9 million, which is DKK 4.3 million more than for the first quarter of last year due to revenue growth.

• • As at 31 March 2022, the Group's total assets amounted to DKK 2,885.9 million, which is DKK 296.2 million more than at the same time in 2021. The increase is primarily attributable to investments in property, plant and equipment, increasing inventories and trade receivables.

• • As at 31 March 2022, the Group's equity totalled DKK 1,184.8 million, which is DKK 132.8 million more than at the same time in 2021. The solvency ratio was 41.4% against 40.6% at 31 March 2021.

• • Cash flow from operating activities for the first quarter of 2022 was DKK -110.2 million, which is DKK 216.1 million less than for the same period last year. The decrease is primarily attributable to increased working capital, which is affected by the decision to temporarily build up stocks to ensure product availability in situations where there is shortage of supply. In addition, the increase is driven by the fact that a higher proportion of revenue relates to B2B customers with credit facilities. Investments for the first quarter of 2022 totalled DKK 60.4 million, compared with DKK 37.9 million for the first quarter of 2021. These investments relate primarily to the expansion of the automated central warehouse in Albertslund and the expansion of the logistics centre in Horsens. Moreover, AO has acquired the previously rented store in Ringsted.

• • As at 31 March 2022, the net interest-bearing debt totalled DKK 488.7 million against DKK 235.2 million at the same time in 2021. The net interest-bearing debt was 1.2 compared with the Last Twelve Months EBITDA.

Other highlights for the first three months of 2022:

• • COVID-19 had a negative impact on the activities of the first quarter of 2002. February, in particular, was affected by high levels of infection, which meant that a significant proportion of the customers' employees could not complete planned work in full.

• • There is increasing supply uncertainty in relation to a number of products. To ensure the supply of goods, AO has made additional purchases of a number of products, where supplies are considered to be uncertain.

• • The Danish competition authorities approved AO's acquisition of EA Værktøj Engros A/S. The acquisition was completed on 1 April 2022, and as of this date EA Værktøj Engros A/S is part of the AO Group.

• • The Annual General Meeting approved the recommended consolidated and parent company financial statements as well as the allocation of profits, including a dividend payment of DKK 45 per share of DKK 10. All shareholder-elected Board members were re-elected. Afterwards the Board of Directors constituted itself with Henning Dyremose as Chairman and Michael Kjær as Deputy Chairman. The Board of Directors was authorised to acquire own B shares equivalent to a total of 10% of the Company's share capital.

• • Following a resolution at the Annual General Meeting, the name of the preference shares was changed into B shares, without changing benefits and rights. At the same time, a share split at a ratio of 1:10 was carried out.

Expectations for the year

The first quarter of 2022 showed higher-than-expected growth in the B2B activities. As expected, the quarter showed negative B2C growth, albeit with a slightly higher decrease than expected.

Based on the activity level and earnings in the first quarter of 2022, expectations for 2022 need to be adjusted. Without including EA Værktøj, expectations for 2022 are now at the upper end of the previously announced revenue of DKK 4,900-5,100 million, EBITDA of DKK 435-465 million and earnings before tax are in the range of DKK 330-360 million.

For the period 1 April to 31 December 2022 EA Værktøj is expected to contribute with revenue in the range of DKK 200-250 million, an EBITDA of approximately DKK 20 million and earnings before tax (EBT) of approximately DKK 15 million.

Revenue

Revenue for 2022 is expected to be in the region of DKK 5,200-5,300 million, corresponding to a growth of 8-10%. As stated in the annual report, revenue was expected to be in the range of DKK 4,900-5,100 million, not including EA Værktøj. Revenue for 2021 was DKK 4,800.5 million.

EBITDA

EBITDA for 2022 is expected to be in the range of DKK 455-485 million, corresponding to an EBITDA margin of 8.6%-9.3%. As stated in the annual report, EBITDA in the range of DKK 435-465 million, not including EA Værktøj, was expected. EBITDA for 2021 was DKK 417.2 million.

EBT

Profit before tax (EBT) of DKK 345-375 million is expected, which corresponds to a profit margin of 6.5%-7.2%. As stated in the annual report, EBT in the range of DKK 330-360 million, not including EA Værktøj, was expected. Profit before tax for 2021 was DKK 326.1 million.

These expectations are based on the assumption that the high level of activity in the building and construction sector will continue, and that there will be a reasonable security of supply. The increase in inflation is expected to have a negative spillover effect on demand. The extent and timing of the impact is difficult to predict, and it is therefore estimated that there will be a larger degree of uncertainty than usual in the second half of 2022.

No significant impact is expected as a result of the war in Ukraine.

The activity at the beginning of 2022 was characterised by many COVID-19 cases of infection in society, which led to higher than usual absenteeism among AO's customers. The growth expectation for 2022 is based on an assumption of normalised conditions in relation to COVID-19 for the rest of the year.

Albertslund, 28 April 2022

Niels A. Johansen CEO

Per Toelstang CFO

Financial and operating data for the AO Group

(DKKm)

Q1 Q1 Full Year

Key figures

2022 2021 2021

Consolidated revenue Gross margin 1,251.3 1,230.5 295.0 288.0 Earnings before interest, taxes, depreciation and amortisation (EBITDA) 110.8 107.9 Profit or loss before financial income and expenses (EBIT) Financial income and expenses, net 84.9 82.1 1.0 (0.6) Profit or loss before tax (EBT) 85.9 81.6 Tax on profit or loss for the period Net profit or loss for the period (18.8) (17.0) 67.0 64.6

4,800.5 1,119.3 417.2 316.7 9.4 326.1 (72.3) 253.8

Non-current assets Current assets Total assets Share capital Equity 1,527.9 1,352.4 1,358.0 1,237.3 2,885.9 2,589.7 28.0 1,184.8 28.0 1,051.9 Non-current liabilities Current liabilities 297.8 1,403.4 337.6 1,200.2

1,472.7 1,235.9 2,708.5 28.0 1,239.9 295.9 1,172.7

Cash flow from operating activities Cash flow from investing activities (110.2) 105.9 (60.4) (37.9) Of which investments in property, plant and equipment, net (53.3) (31.9) Cash flow from financing activities Cash flow for the period 34.4 (38.0) (136.3) 30.0

308.1 (212.7) (170.5) (91.6) 3.7

Financial ratios*

Gross profit margin EBITDA margin Profit margin 23.6% 23.4% 8.9% 8.8% 6.8% 6.7% Return on capital employed** Return on equity** 3.0% 3.3% 5.5% 6.2% Net geraring Solvency ratio 1.2 0.7 41.1% 40.6%

23.3% 8.7% 6.6% 12.4% 22.4% 0.5 45.8%

Book value 42.3 37.6 Share price at the end of the period*** Earnings per share (EPS Basic), DKK **** Diluted earnings per share (EPS-D), DKK **** 109.0 74.4 2.5 2.4 2.5 2.4

44.3 136.0 9.3 9.3

Average number of employees 737 695 Average number of employees, incl. external temporary workers 809 773

705 784

* Other financial ratios have been calculated in accordance with CFA Society Denmark's 'Recommendations and Financial Ratios'. ** Not translated into full-year figures.

*** Comparative figures related to shares are adjusted to reflect share split in 2022.

**** Basic EPS and diluted EPS have been calculated in accordance with IAS 33.