Componenta : Annual review 2022

2022

Annual Review

Contents

Contents

CEO´s review	Board of Director's	Consolidated financial	Notes to the consolidated	Parent company	Other
report	statements	financial statements	financial statements	information

Componenta in brief	3
CEO's review	5
Sustainability highlights in 2022	7
Componenta's value creation	8
Board of Director's report 2022	9
Report on non-financialinformation	12
Information in accordance with the EU Taxonomy Regulation	18
Key figures	30
Calculation of key figures	31
Group financial development	32
Consolidated financial statements	33
Consolidated income statement	33
Consolidated statement of comprehensive income	34
Consolidated statement of financial position	35
Condensed consolidated cash flow statement	36
Statement of changes in consolidated shareholders' equity	37
Notes to the consolidated financial statements	38
Accounting principles for the consolidated financial statements	38
1	Net sales	42
2	Other operating income	44
3	Operating expenses	44
4	Personnel expenses	45
5	Research and development costs	45
6	Depreciation, amortization and write-downs of non-current assets	45
7	Financial income and expenses	46
8	Income taxes	46
9	Earnings per share	47

10	Intangible assets	47
11	Goodwill	48
12	Tangible assets	49
13	Inventories	52
14	Accounts receivables	53
15	Other short-term receivables and accrued income	54
16	Deferred tax assets and liabilities	54
17	Investment properties	56
18	Share capital, share premium reserve and other reserves	57
19	Capital management	58
20	Share-based payment	58
21	Pension obligations and other benefit plans	60
22	Provisions	61
23	Financial risks and instruments	61
24	Other non-interest bearing liabilities and accruals	65
25	Reconciliation of financial liabilities to cash flow statement	65
26	Lease liabilities	67
27	Contingent liabilities	67
28	Related party disclosures	68
Parent company financial statements	69
Parent company income statement	69
Parent company balance sheet	70
Parent company cash flow statement	71
Accounting principles for the financial statements	72
Notes to the parent company financial statements	74
Signatures for the financial statement and Board of Directors' report	81
Auditor's Report (Translation of the Finnish Original)	82
Information for shareholders	88

Componenta Corporation // Annual Review 2022

> Contents

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Contents	CEO´s review	Board of Director's	Consolidated financial	Notes to the consolidated	Parent company	Other
report	statements	financial statements	financial statements	information

Componenta in brief

Componenta Corporation is an international technology company and Finland's leading contract manufacturer in the machine building industry. Sustainability and customer needs are at the core of the company's broad technology portfolio.

Breakdown of net sales by market area in 2022

Componenta Corporation manufactures components for its customers, which are global manufacturers of machinery and equipment. The company's stock is listed on Nasdaq Helsinki (CTH1V).

Other

countries

MEUR

0.7

SwedenFinland

MEUR MEUR

12.4 87.1

Net sales

EUR 109.1 million

Liikevaihdon jakautuminen

Machine building	46%
Agricultural machinery	31%
Forestry machinery	7%
Energy industry	8%
Defence equipment industry	2%
Other industries	6%

EBITDA

EUR 7.1 million

Operating result

EUR 1.6 million

Average number of personnel

~643

Order book at the end of the year

EUR 18.5 million

Other

European countries

MEUR

5.2

Germany

MEUR

3.5

Componenta Corporation // Annual Review 2022

> Componenta in brief

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Contents	CEO´s review	Board of Director's	Consolidated financial	Notes to the consolidated	Parent company	Other
report	statements	financial statements	financial statements	information

2022 in brief

• Our net sales, EBITDA and market share continued to grow throughout the year in a very challenging operating environment, thanks to higher delivery volumes and the implementation of our own development measures as planned.
• In response to Componenta's growing market share and to increase sales further, its sales organisation was reinforced in Finland and Sweden during 2022.
• On 30 August 2022, Componenta Corporation's Board of Directors decided to carry out a EUR 0.497 million directed share issue as part of the USD 8 million share subscription facility previously agreed with Global Corporate Finance LLC (GCF), which the company announced on 21 June 2021. The share subscription facility was used for the first time on 30 August 2022. In connection with this, a total of 194,944 shares was offered to be subscribed for by GCF. This corresponded to around 2.0% of all the shares in the company following the implementation of the arrangement.
• On 21 December 2022, Componenta Corporation announced that it had agreed on a EUR 4 million working capital loan with LocalTapiola and Elo Mutual Pension Insurance Company. The loan is expected to be fully drawn down by 31 March 2023. The loan period is five years.

Key figures	2022	2021	Change, %
Net sales, EUR thousand	109,087	87,254	25.0
EBITDA, EUR thousand	7,086	4,959	42.9
Operating result, EUR thousand	1,555	13	11,864.5
Operating result, %	1.4	0,0	9,524.9
Result after financial items, EUR thousand	-107	-405	73.5
Net result, EUR thousand	52	-405	112.9
Basic earnings per share, EUR	0.01	-0.04	123.5
Diluted earnings per share, EUR	0.01	-0.04	123.8
Cash flow from operating activities, EUR thousand	6,171	2,837	117.5
Interest-bearing net debt, EUR thousand	4,818	6,714	-28.2
Net gearing, %	20.0	28.6	-30.1
Return on equity, %	0.2	-1.7	111.7
Return on investment, %	4.3	3.2	35.5
Equity ratio, %	41.1	42.3	-2.9
Capital expenditure incl. lease liabilities, EUR thousand	3,617	1,249	189.7
Number of personnel at the end of the period, incl.	643
leased workers	612	5.1
Average number of personnel during the period, incl.	643
leased workers	592	8.6
Order book at the end of the period, EUR thousand	18,481	13,954	32.4

Componenta Corporation // Annual Review 2022

> Componenta in brief

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Contents	CEO´s review	Board of Director's	Consolidated financial	Notes to the consolidated	Parent company	Other
report	statements	financial statements	financial statements	information

CEO's review

"Dear stakeholders,

In 2022, we continued to implement our growth strategy successfully in a very challenging environment. Our net sales developed favourably during the year, and our market share and EBITDA continued to grow as planned. Given the circumstances, we are pleased with our performance. Our liquidity also remained at a very good level throughout the year.

Our employees' resilience and strong commitment ensured a solid foundation for positive development. Their ability to adapt to changes in the operating environment has contributed to our continued high-quality service and delivery capabilities. The availability of labour also began to improve during 2022, and our personnel resources meet our current production needs.

The prolonged situation in Ukraine has increased overall market uncertainty and challenges in material availability and cost development, in addition to having a strong impact on the price of electricity in particular. As a result of accelerating inflation, costs continued to increase throughout the year, which affected our profitability. During the second half of the year, we also had

to prepare for extreme fluctuations in the price of electricity and possible availability restrictions. In our most energy-intensive operations, we increased night-time production, which contributed to the management of the electricity system in Finland. The most intense volatility in the energy market is currently easing, but we must continue to actively monitor the circumstances and respond to the situation as required.

In our own operations, we successfully managed our supply chain and secured our production and deliveries to customers despite the challenging circumstances and cost development. Continued good customer service and reliable operations and deliveries were also highlighted as Componenta's strengths in the customer satisfaction survey carried out in December 2022. Because of the market conditions in recent years, our customers are more actively moving their production chains closer to their assembly plants in Europe to improve their operations in terms of flexibility, risk management and sustainability. This strengthens Componenta's future potential as a growing provider of comprehensive contract manufacturing deliveries.

Our employees' competence, expertise, motivation and continuous development are essential and critical factors for us as a contract manufacturer. Our industry is personnel-intensive, meaning that investments in resources and the wellbeing and competence of our personnel will continue to boost the company's success. To this end, we are systematically focusing on supervisory work and wellbeing and safety at work on a daily basis. In our operational units, we are systematically building a consistent safety culture, in addition to developing and harmonising our core processes. We encourage our employees to participate proactively in operational development and risk assessment and minimisation, so that all our units can successfully implement the "zero accident" principle at the annual level.

Componenta Corporation // Annual Review 2022

> CEO's review

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