ANY Biztonsági Nyomda : The Printing Company achieved outstanding export performance

INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

The Printing Company achieved outstanding export performance

ANY Security Printing Company PLC (BSE: ANY, hereinafter referred to as "ANY PLC" or the "Company") has released its 2023 January-December results (available on the websites www.bet.hu,www.kozzetetelek.huand www.any.hu).

SUMMARY

• Net sales of ANY PLC for 2023 amounted to HUF 55.5 billion which is higher by HUF 12.3 billion (28%) than in the previous year. Changes in case of strategic product segments were as follows: sales of security products, solutions were HUF 29.1 billion, which is HUF 13.8 billion (90%) higher than the figure in the basis period; data processing were HUF 11.2 billion, which is HUF 0.2 billion (9%) lower than the figure in the basis period, whilst sales of card production, personalisation were HUF 12.2 billion, which is HUF 1.1 billion (9%) lower than the figure in the basis period. Ratio of strategic products segments in total net sales was 94% in 2023.
• Export sales amounted to HUF 30.3 billion as at December 31, 2023, which is HUF 14.2 billion higher than in the previous year, representing 55% export sales ratio.
• Consolidated EBITDA is HUF 8,775 million.
• Consolidated operating income is HUF 6,402 million.
• Consolidated net income after interest income, taxation and non-controlling interest is HUF 4,267 million.

"The year 2023 was outstanding for the Printing Company, especially in terms of export activity. Our projects not only strengthen our market position, but also contribute to strengthening global security. Thanks to the increased demand for passports, we continue the capacity expansion investments at the Printing Company. Automation and efficient production require continuous technological developments. In market research and production optimization, as well as meeting high quality standards, artificial intelligence is gaining more ground. Our results, financial stability, and further successes are guaranteed by our unwavering commitment to innovation and development. Taking into account the financing needs for the development necessary to maintain growth, the Board of Directors proposes a dividend payment of HUF 250 per share to the General Meeting." - added Gábor Zsámboki, CEO of ANY Security Printing Company PLC, to the 2023 report.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

ANY Security Printing Company PLC hereby declares that the Consolidated Q1-Q4 Interim Management Report prepared on the basis of best knowledge, gives a true and fair view of the assets, liabilities, financial position, profits and losses of the Issuer as well as the companies involved into the consolidation, furthermore the consolidated Management Report gives a true and fair view of the development, performance and describing the main risks.

Gábor Zsámboki

Chief Executive Officer

Budapest, 8th March, 2024

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Consolidated management report

on the results and prospects of Q1-Q4 2023, and on quantitative and qualitative indicators

Consolidated net sales

The breakdown of net sales by segment is presented in the table below:

			2022 Q1-Q4		2023 Q1-Q4		Change		Change %
	Sales segments		HUF millions		HUF millions
				(B-A)		(B/A-1)
			(A)		(B)
Security products and solutions	15.292		29.061	13.769		90.04%
Card production and personalization	13.302		12.163	(1.139)		-8.56%
Form production and personalization, data	11.367		11.151	(216)		-1.90%
processing
Traditional printing products	2.107		1.992	(115)		-5.46%
Other	1.113		1.108	(5)		-0.45%
Total net sales	43.181		55.475	12.294		28.47%

ANY PLC had consolidated net sales of 55,475 million in Q1-Q4 2023, which is HUF 12,294 million (28%) higher than the sales for the base period.

Sales of security products and solutions came to HUF 29,061 million in Q1-Q4 2023 which means an increase of HUF 13,769 million (90%) compared to the base period. The increase was mainly driven by the export projects, higher tax stamps turnover, and invoiced revenue from the roll-out of passport issuing systems.

The Company's revenues from card production and personalisation totalled HUF 12,163 million in the period of reference, a HUF 1,139 million (9%) decrease compared to similar period of year 2022. The main reason for the change is the declining turnover of other document cards.

The Company's revenues from form production, personalisation and data processing came to HUF 11,151 million in Q1-Q42023, HUF 216 million (2%) lower than the sales for the base period. The main reason for the change is the decrease in turnover from export form production and personalization.

Sales of traditional printing products amounted to HUF 1,992 million in the period of reference, which means a HUF 115 million (5%) decrease compared to the previous year's similar period. Lower volume of book orders is behind the change.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Other sales totalled HUF 1,108 million in Q1-Q4 2023, which is a decrease of HUF 5 million compared to the correspondent period of the last year. This segment mainly comprises revenues from the sale of commercial materials and goods.

Export sales by segment

			2022 Q1-Q4		2023 Q1-Q4
	Sales segments		in HUF		in HUF		Change		Change %
		millions		millions
			(A)		(B)		(B-A)		(B/A-1)
Security products and solutions	2.917		17.417		14.500		497.09%
Card production and personalization	1.694		1.981		287		16.94%
Form production and personalization, data	10.228		9.889		(339)		-3.31%
processing
Traditional printing products	267		205		(62)		-23.22%
Other	976		801		(175)		-17.93%
Total export sales	16.082		30.293		14.211		88.37%
Export %	37.24%		54.61%

Export sales amounted to HUF 30,293 million as at December 31, 2023, which was HUF 14,211 million higher compared to a year earlier, representing 55% export sales ratio.

Sales of security products and solutions were HUF 17,417 million, which is HUF 14,500 million higher, than the same period of the last year, mainly due to increased sales of passports and other security products and revenue from passport system roll-out tasks.

Export sales of card production and personalization was HUF 1,981 million in Q1-Q4 2023, which was HUF 287 million (17%) higher compared to the base period, due to the increased turnover of card documents. In the field of form production, personalisation and related logistics services export sales was HUF 9,889 million at the end of the period, decreased by HUF 339 million (3%) compared to the base period.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Income statement analysis

The table below presents the calculation of operating income according to the so-called "total cost

accounting" method.

			2022 Q1-Q4		2023 Q1-Q4
	Description		in HUF		in HUF		Change	Change %
		millions		millions
			(A)		(B)		(B-A)	(B/A-1)
Net sales	43.180		55.475		12.295	28.47%
	Capitalized value of assets produced	602		1.202		600	99.67%
	Material expenses	28.200		34.151		5.951	21.10%
	Personnel expenses	9.740		12.717		2.977	30.56%
	Depreciation	2.047		2.373		326	15.93%
	Other expenses/(revenues)	209		1.034		825	394.74%
Operating income	3.586		6.402		2.816	78.53%
Net profit	2.244		4.267		2.023	90.15%
EBITDA	5.633		8.775		3.142	55.78%
EBITDA margin (%)	13.05%		15.82%

Net sales totalled HUF 55,475 million in Q1-Q4 2023, which is HUF 12,295 million (28%) increase compared to the figure for the same period of last year.

Operating income came to HUF 6,402 million, an increase of HUF 2,816 million compared to the previous period.

Gross profit totalled HUF 17,684 million, which means a 32% gross margin. General (SG&A) expenses amounted to HUF 10,248 million in Q1-Q4 2023, which equals to 18% of net sales.

Material expenses amounted to HUF 34,151 million, higher by HUF 5,951 million (21%) in the current period due to increased raw material prices and due to services used and consignment services connected to export projects.

The capitalized value of own performance line shows the capitalized value of assets produced and the change in inventories manufactured. These figures were driven mainly by the change in inventories in both periods presented; the most significant of these is the value of work-in-production (WIP) connected to security and card products.

Personnel expenses totalled HUF 12,717 million, which is HUF 2,977 million (31%) higher than in the base period, due to the increase in staffing levels, the wage increase implemented and to the achievement based salaries connected to higher turnover and its contributions.

EBITDA amounted to HUF 8,775 million due to the change in operating income and depreciation, which represents an increase of HUF 3,142 million compared to previous period's EBITDA. Therefore EBITDA margin is 16%.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Net interest income amounted to -540 million HUF in Q1-Q4 2023, due to higher interest rates. The foreign currency gain is HUF -178 million, which is the result of the favourable change in the foreign exchange rates. Net income - after financial operations, taxation and minority interest - came to HUF 4,267 million in Q1-Q4 2023, which is HUF 2,023 million higher in the base period.

Balance sheet analysis

The Company had total assets of HUF 41,478 million on 31 December 2023, which increased by HUF 7,351 million compared to the previous year-end.

Receivables amounted to HUF 12,675 million which represents a HUF 7,068 million increase compared to the 2022 year-end, due to increased turnover and to the invoices of big projects issued at the end of the year.

Cash and bank totalled HUF 6,056 million which represents a HUF 337 million decrease compared to the 2022 year-end balance.

Inventories totalled HUF 6,626 million, which is a HUF 138 million (2%) increase compared to the 31 December 2022 figure mainly due to increased work-in progress and semi-finished products.

Other current assets and prepayments amounted to HUF 1,964 million, which is increased by HUF 821 million compared to previous year-end mainly due to the increase in the paid advances related to the Angolan projects.

The balance of property, plant and equipment at the end of December 2023 was HUF 12,839 million, a decrease of HUF 245 million compared to the end of 2022.

Goodwill amounted to HUF 639 million which is the same as last year's balance.

Accounts payable totalled HUF 5,909 million, HUF 1,582 million (37%) higher compared to the end of December 2022, mainly due to the increase in accounts payable related to the Angolan projects.

Other payables and accruals amounted to 8,947 million, which is decreased by HUF 2,105 million (19%) compared to the 31 December 2022 figure mainly due to a decrease in advances received from customers related to the Angolan projects.

Lease liabilities relating to the purchase of fixed assets have a balance of HUF 239 million, from which HUF 105 million is long-term part, HUF 134 million is short-term liability.

Balance of long-term loans totalled HUF 4,049 million which represents a HUF 309 million decrease compared to the 2022 year-end. The Company's operation is financed by short term loans, which reached HUF 8,474 million on 31 December, 2023, out of which short term part of long term loan is HUF 4,930 million.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Changes in equity

				Issued			Capital			Retained			Treasury			Other			Non-
	In HUF thousands:											comprehensive			controlling			Total
			Capital			Reserve			Earnings			Shares
												income			Interest
January 1, 2022		1,449,876		250,686		8,054,043		(455,048)		94,107		1,048,010			10,441,674
Dividend paid		-		-		(2,407,098)		-		-		-		(2,407,098)
Profit after tax attributable to		-		-		2,244,042		-		-		-		2,244,042
	owners of the Company
Other comprehensive
	income attributable to		-		-		-		-		137,933		(268,388)		(130,455)
	owners of the Company
Change in share to non-		-		-		-		-		-		455,257			455,257
	controlling interests
December 31, 2022		1,449,876		250,686		7,888,003		(455,048)		232,040		1,229,879			10,595,436
Dividend paid		-		-		(2,309,466)		-		-		-		(2,309,466)
Profit after tax attributable to		-		-		4,267,289		-		-		-		4,267,289
	owners of the Company
Other comprehensive
	income attributable to		-		-		-		-		(7,720)		(57,571)		(65,291)
	owners of the Company
Change in share to non-		-		-		-		-		-		430,348			430,348
	controlling interests
Change in dividend to non-		-		-		-		-		-		(1,654)		(1,654)
	controlling interests
September 30, 2023		1,449,876		250,686		9,845,826		(455,048)		224,320		1,601,002			12,916,662

Cash flow analysis

Net cash flow from operating activities amounted to HUF -1,456 million in Q1-Q4 2023. The HUF 5,862 million net income before taxation and non-controlling interest was increased by HUF 3,301 million worth of items with no actual cash flow, the most important being depreciation and amortization. The change in trade receivables, inventories and liabilities decreased net cash flow from operating activities by HUF 9,129 million. Interest and tax payments totalled HUF -1,520 million in the period.

Major part of the -1,965 million HUF negative cash flow is from investing activities mainly contains the amounts spent on fixed assets.

The cash flow from financing activities totalled HUF 3,085 million which was mainly due to the increase in short-term loans, to the decrease in long-term loans and to the dividend paid.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

As a result of the above, cash and cash equivalents decreased by HUF 337 million compared to the same period in 2022, and totalled HUF 6,056 million on 31 December 2023.

Business environment of the Company

ANY Security Printing Company PLC (former State Printing Company PLC) established in 1851, is one of the largest printing companies in Hungary and a leading one in the CEE region. ANY is a public limited company registered under the laws of Hungary. The Company operated as a State enterprise until 1992 when it was transformed into a limited liability company (PLC). The Company's registered office is located in Budapest in the 10th district at Halom street 5.

ANY Security Printing Company Group consists of nine companies, with 5 sites in Hungary, 2 sites in Romania and one each in Slovakia and Moldova. The group is one of the largest security and business form printing company in the Central and Eastern European Region in terms of turnover. The Company's shares have been listed on the Budapest Stock Exchange in the premium category since 2005. Its financial situation is characterised by stable and efficient operation.

Goals and strategy of the Company

ANY Security Printing Company's strategy is focused on secure person and product identification and payment-related products. The Company's activities are characterised by references such as the production and personalisation of Hungarian electronic identity cards and the supply of biometric passports, visas and tax, revenue and excise stamps. As a result of our export activities, our products are supplied and well known in more than 50 countries. The steady growth and the ever-increasing security needs of the security product and document market provide opportunities for further expansion in foreign markets. The development is supported by our R&D activities and innovative products in the Hungarian and international markets. The aim is to introduce digital solutions as extensively as possible, complementing our current portfolio.

Main risks of the Company, changes and uncertainties connected to them

Foreign currency risk

Among foreign currency transactions of the Group EURO based transactions are the most important ones. Foreign currency liabilities mainly occur from raw material purchases, which are hedged by the receivables from the export sales in foreign currency as a natural hedge. Due to the balance of foreign currency receivables and liabilities the foreign currency risk of the Group is moderate.

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

Interest rate risk

Due to the debts in ANY PLC, potential interest rate changes would not influence significantly the amount of interests to be paid by the Company.

Liquidity risk

The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecasts and actual cash-flows and by matching the maturity profiles of financial assets and liabilities. Liquidity risk of the Group, due to the high balance of net working capital, is low.

Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties, and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. Trade receivables consist of a large number of costumers, spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

Significant events between 31 December 2023 and the publication of the interim management report

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INTERIMMANAGEMENTREPORT 2023.Q1-Q4RESULTS

	Name of		ANY Security Printing		Phone:		[phone]
	company:		Company PLC.
	Address of		Budapest, Halom u. 5. H-1102		Facsimile:		[phone]
	company:
	Sector of activity:		Other not specified printing		E-mail address:		[e-mail]
	Period:		1 January 2023 -		Investor relations contact		Tamás Karakó
		31 December 2023		person:		Chief Financial Officer

Forms related to financial statements

PK1. General information on financial data

	Yes		No
Audited			X
Consolidated	X
Accounting standards		Hungarian		IFRS	X	Other
Other: …………………

PK2. Companies involved in consolidation

Name of the Company	Equity	Share of ownership	Voting right *	Classification **
Gyomai Kner Nyomda Zrt.	HUF 200,000,000	99.48%	99.48%	L
Specimen Zrt.	HUF 100,000,000	100.00%	100.00%	L
Techno-progress Kft.	HUF 5,000,000	100.00%	100.00%	L
ANY Ingatlanhasznosító Kft	HUF 3,000,000	100.00%	100.00%	L
Zipper Services SRL	RON 2,060,310	60.00%	60.00%	L
Tipo Direct Serv SRL	MDL 30.308	60.00%	60.00%	L
Atlas Trade Distribute SRL1	RON 1,000	60.00%	60.00%	L
Slovak Direct SRO	EUR 63.965	100.00%	100.00%	L

• Voting rights that entitle the holder to participate in decision making at the general meeting of the company included in consolidation.
• Fully controlled subsidiaries (L); Joint ventures (K); Associated undertakings (T)

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