Metalfrio S A : Dados Econômico-Financeiros

Metalfrio Solutions S.A.

Quarterly Information

September 30, 2021

(A free translation of the original financial statements in Portuguese, prepared in accordance with the International Financial Reporting Standards (IFRS), with the accounting practices adopted in Brazil and rules of the Brazilian Securities and Exchange Commission - CVM)

Metalfrio Solutions S.A.

Quaterly Information

Quarter ended September 30,2021

Contents

Management report

Independent auditors' report on the financial statements

Balance sheets

Statements of income

Statements of comprehensive income Statements of changes in shareholders' equity Statements of cash flows

Statements of added value

Notes to the financial statement

Other information

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MANAGEMENT REPORT

Third Quarter and Nine Months of 2021 Results November 19th, 2021

São Paulo, Brazil, November, 19th 2021 - Metalfrio Solutions S.A. (FRIO3) ("Metalfrio"), the world's leading cold solutions provider, announces its results for the third quarter of 2021 ("3Q21") and nine months of 2021 ("9M21"). Financial and operational information given are in accordance with accounting practices adopted in Brazil and International Financial Reporting Standards (IFRS), in Brazilian Reais (R$). Comparisons are with the third quarter of 2020 ("3Q20") or nine months of 2020 ("9M20") or as indicated.

3Q21 AND 9M21 HIGHLIGHTS

• Revenues increased by 22% in 3Q21 to R$415 million and 40% in 9M21 to R$1,487 million benefiting from both, new customers acquired during the pandemic (diversifying our customer base) and the strong recovery in the Brazilian market.
• Revenues from Services increased 18% to R$69 million for 3Q21, compared to R$59 million in 3Q20. During 3Q21 the company implemented new price adjustments that benefitted the service's margin.
• EBITDA in 3Q21 increased by 19% to R$32 million compared to R$27 million 3Q20. EBITDA 9M21 reached a record result of R$140 million, an increase of 42% vs 9M20, whilst the LTM EBITDA was R$172 million (LTM Adjusted EBITDA was R$179 million).
• Net Loss of R$38 million in 3Q21 and a Net Loss of R$13 million in 9M21 vs Net Loss of R$157 million in 9M20 as a result of better Operational and Financial results.

Commenting on the results, the Company stated:

"Metalfrio continued to benefit from recovering market conditions to sustain the Revenue growth momentum as well as EBITDA improvement despite the high inflationary pressure related to raw material cost escalation, lower purchases from key accounts, wide-ranging supplier base disruptions including the shortage of electronic components.

During 2021, Metalfrio demonstrated versatility to adjust its sales mix to attend both key accounts and middle market, with healthy margins, whilst continuing to deliver its innovation pipeline. The lower sales to key accounts have been compensated through emphasis on gains with medium/smaller companies. Going forward, with the continued recovery of the key account placements Metalfrio will benefit from this expanded sales scope.

Our industry continues facing challenging conditions as the commodity super cycle and raw material shortages ensue, with normalization now expected only during the next year. Nevertheless with the introduction of new products, intensified cost optimization programs and adjustments to commercial policy, the Company is already improving its Gross Margin when comparing the 3Q21 with previous quarter.

Metalfrio's strategy includes integrating products and services related to commercial refrigeration, such as, logistics, field maintenance, refurbishment, parts sales and equipment rental, providing additional value added through our Service Solutions. Service margin has been improving as new clients have been incorporated into our national platform and the investments made in technological solutions are allowing us to manage our operation more efficiently and deliver better performance.

After establishing a competitive market size, Metalfrio believes it is the right time to seek better margins exploring internal savings opportunities.

(R$ million)	3Q21	3Q20	% Var	9M21	9M20	% Var
Net Revenues	414.9	341.0	21.7	1,487.3	1,058.7	40.5
Gross Profit	57,1	56,6	1.0	227.5	188.4	20.7
Gross Margin	13,8%	16,6%		15.3%	17.8%
EBITDA	32,1	27,0	18,8	140,3	99,1	41,6
Adj. EBITDA	32.4	33.3	-2.6	141.9	114.3	24.1
Adj. EBITDA Margin	7.8%	9.8%		9.5%	10.8%

Third Quarter and Nine Months 2021 - November 19th, 2021 - Metalfrio

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Third Quarter and Nine Months of 2021 Results

November 19th, 2021

Net Revenue

Consolidated Net Revenues increased 22% in the third quarter to R$415 million, setting a new record level for 3Q sales, benefitting from higher volumes, price adjustments and sales in hard currencies. For the nine months of the year, revenues increased by 40% to R$1,487 million. Net Revenues of the last twelve months (LTM) were R$1,874 million.

Net Revenues 9M21

(R$ million)	3Q21	3Q20	% Var	9M21	9M20	% Var
South America	195.8	111.7	75.3	557.7	364.9	52.9
Central and North America	48.7	36.4	33.8	153.1	124.2	23.3
Europe, M. East and Africa	170.4	193.0	(11.7)	776.5	569.6	36.3
Total	414.9	341.0	21.7	1,487.3	1,058.7	40.5

South America

Sales in 3Q21 reached R$196 million, an impressive increase of 75% when compared with 3Q20 and in terms of units sold, the Company achieved 37% of growth. Metalfrio has also implemented a new commercial strategy of cross-selling that includes the offering of products as well as logistics, maintenance and rental, leveraging its sales team and distribution channels.

The quarter continued to experience consistent market share gains in the middle-market commercial refrigeration as result of the Company's strategy of diversify its customer base with higher gross margin.

For the 9M21 Revenues increased by 53% as a result of a better market condition, improved commercial policy as well as reaching a wider portfolio of customers.

In the Service Segment, the passing on costs increase to customers have started positively impacting the gross margin since June 21.

Central & North America

The region experienced a 34% increase in Revenues vs 3Q20, also benefitting from new customers' sales in the middle market segment. For the period of nine months, Revenues improved by 23%.

This region also experienced a change in the mix of customers as a result of reduction of purchases from domestic Key Accounts offset by the increase of Sales in the distribution channel as well as the gradual resumption of exports to USA.

Europe, Middle East and Africa (EMEA)

Sales in EMEA decreased by almost 12% comparing 3Q21 vs 3Q20, but considering 9M20 vs 9M21 presented an increase of 36% reaching a total amount of R$777 million due to different seasonality patterns.

While Key Accounts decreased their purchases (as a result of the Covid Pandemic), Metalfrio focused on Non Key Accounts that achieved 75% of participation of the total revenues during this quarter.

Sales in 3Q21 had the product mix shifted more to horizontal line and standard products, also as result of Key Account dilution.

Another item that contributed to higher Sales in EMEA in 9M21 was an increase in the average realization price, mostly due to product innovation and sales in hard currencies and the continued growth in Services, as passing on the cost increase of raw materials to customers' price.

CAGR 11%

Third Quarter and Nine Months 2021 - November 19th, 2021 - Metalfrio

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Third Quarter and Nine Months of 2021 Results

November 19th, 2021

Gross Profit (R$ million) & Gross Margin

Gross Profit for the third quarter remained broadly flat when compared with 3Q20, totaling R$57 million with a different geographical breakdown, with South America increasing its GP by R$22 million whilst EMEA saw a seasonal decrease as consequence of the different seasonal profile and adverse product mix of mostly standard and horizontal products with lower margin which offset most of the gain obtained in South America.

For the 9M21, raw material inflation decreased Products Gross Margin, negatively impacting all geographies, but the revenues growth was enough to compensate the lower margin generating a higher total gross profit amount, also supported by higher Services margin. Gross margin in 3Q21 decreased to 13.8% from 16.6% temporarily as the effect of price adjustments versus some normalization in costs will be sequentially margin accretive. Comparing 9M21 vs 9M20, the Gross Margin decreased to 15.3% from 17.8%.

Operating Expenses (SG&A)

SG&A expenses for the nine months increased 21% to R$169 million. Almost all the increase is related to selling expenses including freight as consequence of higher sales. As percentage of Revenues, SG&A decreased to 11.4% from 13.2%, a decrease noted in all regions as consequence of the positive operating leverage.

EBITDA & EBITDA Margin

EBITDA for the third quarter increased by 19% to R$32.1 million, as a result of a strong South America performance which was partially offset by a weaker EMEA performance. For 9M21, EBITDA achieved R$ 140 million, versus R$99 million in the same prior period, resulting in a record LTM EBITDA of R$172 million (LTM Adjusted EBITDA was R$179 million).

Adjusted EBITDA Margin was 9.5% for 9M21, compared to 10.8% for 9M20, as a result of lower gross margin, partially compensated by better SG&A dilution.

Reconciliation of EBITDA and Adjusted EBITDA

	EBITDA (R$ million)			3Q20			4Q20			1Q21			2Q21			3Q21			3Q21 vs
													3Q20
	Operating result	13.3	14.7	25.5	50.1	16.8		26.0%
	Depreciation and amortization	13.7	16.9		16.0		16.7		15.4		11.8%
	EBITDA	27.0	31.6	41.5	66.7		32.1		18.8%
	Other extraordinary expenses/(income)	6.2		5.4	0.8		0.5		0.3
	(i)
	Adjusted EBITDA	33.3	37.0	42.3	67.2		32.4		-2.6%

1. Extraordinary expenses in 2020 and 2021 are mainly due to COVID-19.

Third Quarter and Nine Months 2021 - November 19th, 2021 - Metalfrio

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