Seri Industrial S p A : Board Of Directors approves Results At 30 June 2022

MUNICATOTAMPA

PRESS RELEASE

SERI INDUSTRIAL S.p.A.

BOARD OF DIRECTORS APPROVES RESULTS AT 30 JUNE 2022

REVENUES EQUAL TO EURO 101,477 THOUSAND, WITH AN INCREASE OF 20% COMPARED TO 30

JUNE 2021

• Consolidated Revenues at 30 June 2022: euro 101,477 thousand with an increase of 20% compared to 30 June 2021
• Ebitda adjusted at 30 June 2022: euro 9,071 thousand with an increase of 11% compared to 30 June 2021
• Adjusted Net Debt: euro 97,178 thousand, with an increase of euro 22,131 thousand compared to 31 December 2021

As follows the key highlights as of 30 June 2022:

Highlights

Economic and financial result

Euro / 000	30/06/2022	30/06/2021	Variation	Variation %
Revenues, income and internal works	101.477	84.433	17.044	20%
Gross Operating Income - Ebitda	8.855	8.391	464	6%
Adjusted Gross Operating Income - Adjusted Ebitda	9.071	8.193	878	11%
Net Operating Income - EBIT	(1.932)	(1.376)	(556)	40%
Adjusted Net Operating Income - EBIT	(1.716)	(885)	(831)	94%
Net Result	(5.194)	(4.136)	(1.058)	26%
Adjusted Net Result	(4.286)	(3.609)	(677)	19%
Cash flow from operating activities	(8.662)	7.947	(16.609)	(209%)
Adjusted Investments activities	6.402	7.465	(1.063)	(14%)

Balance sheet results

Euro / 000	30/06/2022	31/12/2021	Variation	Variation %
Net Invested Capital	236.816	218.951	17.865	8%
Consolidated Net equity	116.950	120.934	(3.984)	(3%)
Net financial debt	119.866	98.018	21.848	22%
Adjusted Net financial debt	97.178	75.047	22.131	29%

Personnel

Number of employees	30/06/2022	30/06/2021	Variation	Variation %
FIB Division - Batteries	361	351	10	3%
Seri Plast Division - Plastic materials	307	309	(2)	(1%)
Corporate and other activities	52	50	2	4%
Group	720	710	10	1%

S. Potito Sannitico, 15 September 2022 - The Board of Directors of SERI Industrial S.p.A. (the "Company" and, together with its subsidiaries, the "Group") has examined and approved the consolidated half-yearlyreport as of June 30, 2022.

During the first half of 2022, there was an increase in revenues of 20% compared to the first half of 2021, due to both the increase in sales volumes and the increase in average selling prices.

Despite the current macroeconomic scenario characterized by a significant increase in the cost of energy, the Group has recorded a profitability (Adjusted Gross Operating Income/Revenues) of 9% in the first half of 2022, slightly down from the 9.7% achieved in the first half of 2021.

Economic and financial results

Consolidated economic trend

As follows the Group's Income Statement as of 30 June 2022 compared to the same period of the previous year:

Euro / 000	30/06/2022	30/06/2021	Variation	Variation %
Revenues from contract with customers	89.811	75.876	13.935	18%
Other operating revenues	7.751	5.039	2.712	54%
Internal works	3.915	3.518	397	11%
Total revenues, income and internal works	101.477	84.433	17.044	20%
Operating costs	92.622	76.042	16.580	22%
Gross Operating Income - EBITDA	8.855	8.391	464	6%
Amortization and Depreciation	10.826	9.614	1.212	13%
Write-downs/write-backs	(39)	153	(192)	(125%)
Net Operating Income - EBIT	(1.932)	(1.376)	(556)	40%
Financial management	(2.401)	(1.760)	(641)	36%
Net result before tax	(4.333)	(3.136)	(1.197)	38%
Taxes	861	1.000	(139)	(14%)
Consolidated Net Result		(5.194)	(4.136)	(1.058)	26%

The Net Operating income (EBIT) is equal to negative euro 1,932 thousand, after depreciation and amortization of euro 10,787 thousand. It should be noted that depreciation and amortization are related for euro 5,410 thousand to the completed and on-going investment in Teverola 1 and 2, of which euro 4,212 thousand is related to the amortization on realized investments and euro 1,198 thousand related to the rights of use concerning the lease of the Teverola 1 (euro 515 thousand) and Teverola 2 (euro 683 thousand) building.

In relation to the increase in electricity costs recorded in the first half of 2022, there is a greater impact on operating costs estimated at approximately euro 4,554 thousand. To compensate for the charges incurred due to the increase in the cost of energy, the Group has obtained grants, following the facilitation introduced by the Decree Sostegni-Ter for energy-intensive companies, amounting to euro 1,499 thousand.

The performance of the Group is also assessed by considering certain alternative performance indicators (Alternative Performance Measures, hereinafter also referred to as "APM"), as provided by the European Securities and Markets Authority (ESMA).

The management considers that APMs allow a better analysis of business performance, ensuring a clearer comparability of results over time, isolating non-recurring events, in order to make reporting consistent with forecasting trends. These indicators should not be considered as substitutes for the conventional ones provided by IFRS. In fact, APMs are not required by IFRS and, although they are derived from the Group's financial statements, they are not subject to audit. Therefore, APMs should be read in combination with the Group's financial information derived from the consolidated financial statements.

In particular, the alternative performance indicators refer to the adjustment of the main balance sheet indicators net of non-recurring and/or non-repeating items, the so-called "special item"1.

1 Income figures are classified as special items when: (i) they relate to non-recurring events or transactions, i.e. transactions that are not repeated frequently in the Group's recurring operations; (ii) they derive from transactions that are not representative of the Group's normal operations, such as extraordinary restructuring costs, environmental costs, costs associated with the disposal and evaluation of an asset, costs associated with extraordinary transactions, even if they occurred in previous years or are likely to occur in subsequent years, costs associated with the start-up of new plants, etc; (iii) any capital gains or losses, write-downs or revaluations of shareholdings and/or assets, value adjustments/reversals and depreciation related to extraordinary transactions.

As follows a description of the main alternative performance measures:

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As follows the adjusted income statement of the Group as of June 30, 2022:

Profit and loss		30/06/2022		Special		30/06/2022		30/06/2021	Special	30/06/2021
		items		Adjusted		items	Adjusted
Revenues from contract with customers		89.811				89.811		75.876		75.876
Other operating revenues		7.751		(216)		7.535		5.039	(1.096)	3.943
Internal works		3.915				3.915		3.518		3.518
Total revenues, income and internal works		101.477		(216)		101.261		84.433	(1.096)	83.337
Raw Materials		70.880		(22)		70.858		45.404		45.404
Change in inventories		(18.759)				(18.759)		(960)		(960)
Costs for services		23.746		(3)		23.744		15.387	(271)	15.116
Other operating costs		1.405		(408)		997		1.563	(361)	1.202
Personnel costs		15.350				15.350		14.648	(266)	14.382
Operating costs		92.622		(432)		92.190		76.042	(898)	75.144
Gross Operating Income - EBITDA		8.855		216		9.071		8.391	(198)	8.193
Amortization and Depreciation		10.826		0		10.826		9.614	(574)	9.040
Write-downs/write-backs		(39)		0		(39)		153	(115)	38
Net Operating Income - EBIT		(1.932)		216		(1.716)		(1.376)	491	(885)
Interest income		594				594		305	0	305
Interest expense		2.988		0		2.988		2.069	(8)	2.061
Income (expenses) from associated		(7)				(7)		4	0	4
companies
Net result before tax		(4.333)		216		(4.117)		(3.136)	499	(2.637)
Taxes		861		(754)		107		1.000	0	1.000
Theoretical tax effect		0		63		63		0	(28)	(28)
Consolidated Net Result		(5.194)		908		(4.286)		(4.136)	527	(3.609)

The impact of special items on Net Result before tax is equal to euro 216 thousand, due to a non recurring income for euro 216 thousand and non recurring operating costs for euro 432 thousand.

• EBITDA (or Gross Operating Income): it is an indicator of operating performance and is calculated by adding Depreciation, Amortization and Value Adjustments to Net Operating Income;
• EBITDA adjusted (or Adjusted Gross Operating Income): it is an indicator of recurring operating performance and is calculated by adding EBITDA and special items, i.e. operating costs, with a positive sign, that are non-recurring or non-repetitive;
• EBIT adjusted (Adjusted Net Operating Income): it is measured as the sum of the Net Operating Result and special items, i.e. operating costs and depreciation and amortization, and non-recurring or non-repeating adjustments/reversals, with a positive sign;
• Adjusted Consolidated Net Result: it is calculated adding the special items to the Net Result;
• Net financial debt or Net Financial Position: it is an indicator of the financial structure and it is calculated in accordance with the provisions of Guideline No. 39 issued on 4 March 2021, applicable as of 5 May 2021 and in line with the attention notice No. 5/21 issued by Consob on 29 April 2021;
• Adjusted Net Debt: it is measured by deducting the financial debt related to the application of IFRS 16 from net financial debt;
• Cash flow from operating activities: it is measured by adding changes in inventories, trade receivables, trade payables, funds and other assets/liabilities to EBITDA.
• Adjusted Investment Activities: it is measured eliminating the increases from Right of Use related to IFRS 16 from the investment activities.

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Consolidated Balance Sheet

As follows the composition of Net invested capital as of June 30, 2022 compared with that at the end of the previous year:

Euro / 000		30/06/2022		31/12/2021	Variation	Variation %
Net fixed assets:
Property, plant and equipment, intangible		112.481		114.421	(1.940)	(2%)
assets and rights of use
Goodwill		55.042		55.042	0	0%
Net financial assets valued using the equity		665		554	111	20%
method
Other assets and non-current liabilities		(23.694)		(25.857)	2.163	(8%)
Total net fixed assets		144.494		144.160	334	0%
Net working capital
Trade receivables		35.884		37.015	(1.131)	(3%)
Inventories		81.601		63.606	17.995	28%
Trade payables		(49.921)		(47.930)	(1.991)	4%
Other assets and current liabilities		11.924		9.280	2.644	28%
Total net working capital		79.488		61.971	17.517	28%
Gross invested capital		223.982		206.131	17.851	9%
Other provisions:
Employee benefits		(4.334)		(4.676)	342	(7%)
Provisions for risks and charges		(934)		(1.261)	327	(26%)
Provisions for net deferred taxes		18.102		18.757	(655)	(3%)
Total other provisions		12.834		12.820	14	0%
Net Invested Capital		236.816		218.951	17.865	8%
Equity		(116.950)		(120.934)	3.984	(3%)
Net financial position		(119.866)		(98.017)	(21.849)	22%
Coverage		(236.816)		(218.951)	(17.865)	8%

The Net invested capital as of June 30, 2022 is equal to euro 236,816 thousand and it is covered by consolidated shareholders' equity for euro 116,950 thousand and Net financial debt for euro 119,866 thousand.

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As follows a breakdown of net invested capital's statement by business unit:

Euro / 000	Batteries	Plastic	Other	Corporate	Conso.	Consolida
Materials	effects	ted
Net fixed assets:
Property, plant and equipment, intangible	78.558	33.449	0	473	0	112.481
assets and rights of use
Goodwill	705	0	0	0	54.337	55.042
Net financial assets valued using the equity	383	0	0	89.812	(89.530)	665
method
Other assets and non-current liabilities	(21.296)	(2.401)	0	35.000	(34.997)	(23.694)
Total net fixed assets	58.350	31.048	0	125.286	(70.189)	144.494
Net working capital
Trade receivables	14.964	21.198	0	682	(959)	35.884
Inventories	41.176	40.427	0	0	0	81.601
Trade payables	(20.113)	(29.518)	(3)	(1.242)	955	(49.921)
Other assets and current liabilities	14.428	(1.688)	160	(975)	0	11.924
Total net working capital	50.454	30.419	156	(1.535)	(6)	79.488
Gross invested capital	108.804	61.466	156	123.750	(70.195)	223.982
Other provisions:
Employee benefits	(1.319)	(2.186)	0	(830)	0	(4.334)
Provisions for risks and charges	(672)	(97)	0	(165)	0	(934)
Provisions for net deferred taxes	2.623	2.063	0	13.416	0	18.102
Total other provisions	633	(220)	0	12.421	0	12.834
Net Invested Capital	109.436	61.247	156	136.171	(70.195)	236.816
Equity	(17.815)	(22.864)	(273)	(111.193)	35.195	(116.950)
Net financial position	(91.621)	(38.383)	117	(24.979)	35.000	(119.866)
Coverage	(109.436)	(61.247)	(156)	(136.171)	70.195	(236.816)

As follows the Group's balance sheet as of June 30, 2022, compared to the balance sheet at the end of the previous year:

Euro / 000	30/06/2022	31/12/2021	Variation	Variation %
Current assets	152.066	153.734	(1.668)	(1%)
Non-current assets	189.717	192.316	(2.599)	(1%)
ASSETS	341.783	346.050	(4.267)	(1%)
Current liabilities	127.134	153.733	(26.599)	(17%)
Non-Current liabilities	97.699	71.383	26.316	37%
Consolidated Net equity	116.950	120.934	(3.984)	(3%)
LIABILITIES AND SHAREHOLDERS' EQUITY	341.783	346.050	(4.267)	(1%)

Current assets amount to euro 152 million as of June 30, 2022 against current liabilities of euro 127 million, with a current ratio of 1.20, demonstrating the Group's ability to generate liquidity and meet short-term obligations.

The Current liabilities are decreased of euro 26 million compared to 31 December 2021, mainly due to the exposure in non current liabilities of the non current portions of loan agreements backed by financial covenants, which, in accordance with IAS 1, as of 31 December 2021, had been classified as current liabilities.

Non-current assets amount to euro 190 million as of 30 June 2022, compared to non current liabilities of euro 98 million and consolidated shareholders' equity of euro 117 million.

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