Eternit S A : Release 4Q22

Earnings Release

4Q22

Earnings Release

Contents
Highlights	3
Message from Management	4
Main Indicators	5
Economy and Market	5
Operating Performance	6
Consolidated Financial Performance	10
Capital Markets	16
Subsequent Events	17
Annexes	18

4T22 2

Earnings Release

São Paulo, February 14, 2023 - Eternit S.A. - Under Court-Supervised Reorganization (B3: ETER3, "Eternit" or "Company") announces today its results for the 4th quarter of 2022 (4Q22). Except where stated otherwise, the operational and financial information of the Company is presented on a consolidated basis in thousands of Brazilian reais, in accordance with the Brazilian accounting standards, especially Federal Law 6,404/76 and guidelines issued by the Accounting Pronouncements Committee (CPC) and approved by the Securities and Exchange Commission of Brazil (CVM), which should be read together with the financial statements and notes for the quarter ended December 31, 2022. All comparisons in this earnings release are with the 4th quarter of 2021, except where stated otherwise.

Highlights

4Q22

Eternit reports Net Revenue of R$313 million in 4Q22 and

R$1.2 billion in 2022, up 6% from 2021.

MARKET CAP (12/31/2022)

R$660 million

CLOSING SHARE PRICE (12/31/2022) R$10.69

NUMBER OF SHARES (12/31/2022) 61,776,575

FREE FLOAT

98.41%

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4Q22/4Q21 PERFORMANCE

Net revenue of R$313 million (+8%).

Gross profit of R$79 million, with Gross margin of 25%.

Recurring EBITDA of R$23 million and Recurring EBITDA margin of 7%.

Net income of R$14 million.

4Q22

3

Earnings Release

Message from Management

The Eternit Group reported Net revenue of R$313 million in 4Q22, an increase of 8% from the same period in 2021. In the year, net revenue reached R$1.2 billion, up 6% from 2021, and was achieved in a scenario of sales decline across the construction material industry, which registered a 7% drop in sales during the year, according to ABRAMAT, after posting record performance in 2021.

Recurring EBITDA in 4Q22 came to R$23 million, down 70% from 4Q21, and R$186 million in the year, decreasing 45% from 2021. Similarly, net income totaled R$14 million in 4Q22, down 74% from 4Q21, and R$138 million in 2022, down 49% from 2021.

Continuing the program to modernize the fiber-cement production facilities, in 4Q22 the Company concluded the expansion work at the Rio de Janeiro unit. The expansion of the Rio de Janeiro and Goiânia units will jointly represent an additional capacity of 7,000 tons per month.

The greenfield project related to the fiber-cement roofing panels unit in Caucaia, Ceará, is being implemented; in 4Q22 the earthwork stage was completed and infrastructure work (construction, electrical and hydraulic) began, for which 35% of the machinery and equipment budget was committed. Construction of the new unit, whose initial production capacity will be 6,500 tons per month, should be concluded in the second half of 2023.

Regarding the expansion of the PP unit in Manaus, which produces synthetic polypropylene fiber, the project to remove bottlenecks is on schedule, with the equipment already acquired and installation services being contracted. Expansion of the unit will increase its current capacity by 40%, which will be used to supply Confibra and the greenfield project in Ceará. The expansion of the Manaus unit should be concluded in late 2023.

At the end of 2022, Eternit's bankruptcy-related debt was approximately R$39 million, of which around R$33 million refers to the loan taken from Banco da Amazônia to build the polypropylene fiber unit in Manaus. To conclude the Court-Supervised Reorganization, the Company is awaiting the decision on the special appeal filed at the Superior Court of Justice (STJ) claiming the reestablishment of the payment conditions of labor creditors established in the Court-Supervised Reorganization Plan approved at the general meeting of creditors.

Finally, the Eternit Board of Directors Meeting held on December 13, 2022 approved the payment of interest on equity of around R$10.6 million related to the 4Q22 results, in accordance with the Company's Dividend and Interest on Equity Policy. As such, during 2022, Eternit declared interest on equity in the gross amount of R$38 million, related to its results during the year, representing gross remuneration of R$0.61/per share.

4Q22

4

Earnings Release

Main Indicators

Consolidated - R$ thousand	4Q22	4Q21	Chg. %	3Q22	Chg. %	2022	2021	Chg. %
Gross Sales Revenue	379,701	359,741	5,5	388,640	(2,3)	1.443,665	1.393,132	3,6
Net revenue	312,556	289,545	7,9	323,048	(3,2)	1.187,383	1.123,125	5,7
Gross profit	78,555	119,216	(34,1)	99,990	(21,4)	371,941	491,050	(24,3)
Gross margin	25%	41%	- 16 p.p.	31%	- 6 p.p.	31%	44%	- 13 p.p.
Net income (loss) for the period	14,032	53,343	(73,7)	41,040	(65,8)	137,713	269,446	(48,9)
Net margin	4%	18%	- 14 p.p.	13%	- 9 p.p.	12%	24%	- 12 p.p.
Adjusted Net Income/Loss	13,006	54,866	(76,3)	43,260	(69,9)	129,573	251,059	(48,4)
Adjusted Net Margin	4%	19%	- 15 p.p.	13%	- 9 p.p.	11%	22%	- 11 p.p.
EBITDA CVM 527/12	24,332	73,906	(67,1)	53,444	(54,5)	198,826	362,070	(45,1)
EBITDA Margin CVM 527/12	8%	26%	- 18 p.p.	17%	- 9 p.p.	17%	32%	- 15 p.p.
Adjusted EBITDA	22,778	76,214	(70,1)	56,807	(59,9)	186,492	336,995	(44,7)
Adjusted EBITDA Margin	7%	26%	- 19 p.p.	18%	- 11 p.p.	16%	30%	- 14 p.p.

Economy and Market

Inflation, measured by the Extended National Consumer Price Index (IPCA), reached 5.79% in 2022. In the last quarter of the year, the highest increase was recorded in December (0.62%). On the other hand, the basic interest rate (SELIC) increased continuously during the year, from 9.25% p.a. in December 2021 to 13.75% p.a. in December 2022. Market expectations disclosed in the Focus Report[1] disclosed by the Brazilian Central Bank predict mild GDP growth of 0.80% in 2023, with inflation measured by IPCA of 5.74% and SELIC rate of 12.50% p.a. by the year-end.

	According to the Brazilian Construction
	Materials Industry Association (ABRAMAT)[2],
	revenue from the construction materials
	sector not adjusted for inflation decreased
	1.9% between November and December
	2022. Compared to December 2021, the
	decline was 8.7%.
*Estimates ABRAMAT	Unlike in 2021, when the sector actually
recovered and grew 8.1% in relation to 2020,

ABRAMAT's preliminary estimates point to a 7% decline in 2022 from 2021,mainly due to the high level of household debt in a scenario where the domestic budget is heavily disputed by food-related expenses, which has reduced the demand for construction materials.

1. FOCUS Report - 01/27/2023

[2]ABRAMAT: www.abramat.org.br- ABRAMAT index 01/12/2023

4Q22

5