Ekopak : 1st half 2022 Results

Publication

First half 2022 Results

Together towards

a sustainable future.

This announcement contains inside information for the purposes of

Article 7 of the Market Abuse Regulation (EU) No 596/2014.

F I R S T H A L F 2 0 2 2 R E S U L T S

Sustained momentum for WaaS business model and unparalleled pipeline

Pipeline growth is ahead of plan for reaching the medium term objectives

Tielt (Belgium), 19 September 2022 - 07:30 a.m. CET - Today, Ekopak (EKOP:xbru) published the results for the six-months period ended 30 June 2022.

Highlights 1H2022

• Water-as-a-Service(WaaS) segment: continued acceleration of revenue growth (+336% YoY) with solid EBITDA-margin (67%).
• Non-WaaSsegment: 49% YoY revenue growth confirms structural potential along the WaaS segment.
• Building a strong organisation that is capable of seizing significant business opportunities in the rapidly growing water market, as evidenced by several ongoing, advanced negotiations for major projects at home and abroad.
• Acquisition of the French company H2O Production reinforces Ekopak's technology platform in France. H2O Production generates annual stand-alone revenues of over EUR 2.5 million and will be included in Ekopak's consolidation circle as of September 1, 2022.

Business Outlook

• The triple digit revenue growth forecast for the WaaS segment in 2022 and double digit growth for the non-WaaS segment in 2022 are reconfirmed.
• Preparations for the Waterkracht joint venture and NextGen plant in the Antwerp Port are on track to become operational as of 2025.
• Ekopak is confident of making a significant contribution to helping solve the problem of water scarcity in the medium term.

Management Report

	In EUR thousands		In 000 €	1H2022/	As a % of revenue
		1st Half 2022	1st Half 2021	1H2021	1H2022	1H2021
	Revenue
	WaaS segment	1 225		281	+ 336%
	non-WaaSsegment	6 248		4 207	+ 49%
	Total	7 473		4 488	+ 67%
EBITDA
	WaaS segment	822		199	+313%	67%	71%
	non-WaaSsegment	111		1 097	-90%	2%	26%
	Corporate segment	-1 402		-1 220	+ 15%	19%	27%
	Total	-469		76		-6%	2%
	Excl. start-up costs	85		76	+12%	1%	2%
	new projects*

(*) Expenses directly related to new projects, including Waterkracht joint-venture,NextGen-plant Antwerp,…

The CEO's perspective

Pieter Loose, CEO Ekopak, comments: "Earlier this year I was really impressed with the 25% YoY increase of WaaS business revenue in the first six months of 2021, without any negative impact on the EBITDA-margin. I am pleased that the YoY revenue growth for our WaaS segment now reaches 336% and that the corresponding EBITDA margin remains at a solid 67%, which corresponds with the margin applied in our mid-term business plan: what a tremendous achievement of our team!

Even remarkable is the fact that the impressive growth of the WaaS business does not cannibalise the non-WaaS operations, which demonstrate a 49% YoY growth in revenue over the past period. The EBITDA-margin for this segment is temporarily impacted by the upfront development costs for new business.

The preparatory work for the Waterkracht joint venture and the NextGen water treatment plant in the Port of Antwerp opens perspectives to generate robust annual secured revenue over a period of 35 years starting in 2025. Negotiations for Waterkracht, one of the larger public-private partnership in Belgium, are now in the final

Ekopak - Results for the six-months period ended 30 June 2022 - p. 2

stage, while TotalEnergies has already signed a long-term agreement with water-link for the supply of sustainable process water for its industrial sites in Antwerp.

The great performance in both segments reflect the attractive opportunities in the water treatment market - whether WaaS or non-WaaS. The fact that the climate change has recently become more visible and tangible has fuelled the growth of the entire market.

Ekopak is now building an organisation that can address these positive evolutions, and we carefully analyse the best appropriation of our equity and business resources.

Our strategy to enter the French market is a good example of this approach: following the creation of Ekopak France, we have now strengthened our platform in France with the acquisition of H2O Production, which offers unparalleled synergistic opportunities.

Ekopak is one of the few players in the growing water market that can address the needs of each type of company. Through its recently acquired subsidiary H2O Production, Ekopak offers tailor-made solutions to SMEs, while our non-Waas or WaaS- installations enable major industrial players to install a circular water supply chain. With the Waterkracht- and NextGen-initiatives, Ekopak can even supply sustainable process water to companies that have no or insufficient waste water for recycling.

It is very rewarding to build our business while integrating sustainability into our operations, thus also enabling companies to transform themselves from water users into water producers. I am confident that, in the medium term, we can make a significant contribution to helping solve water scarcity problems, while also achieving our financial targets."

WaaS segment: 336% YoY (1H2022/1H2021) revenue growth, with 67% EBITDA-margin

Ekopak's WaaS business witnessed another record period in the first half of 2022. Segment revenue more than tripled in comparison with the first half of 2021 and now reaches EUR 1.2 million. The YoY revenue growth of 336% compares to a YoY revenue growth of 25% in the first half of 2021 in comparison with the first half of 2020.

WaaS revenue now represents 16% of total revenue in 1H2022, compared to 6% in 1H2021.

Since revenue from WaaS contracts is only recognised as of the moment that the installation becomes operational, a substantial part is not yet included in the 1H2022 figures. The currently signed WaaS contracts represent a secured1 annual2 turnover of over EUR 3.2 million. This is already significantly higher at this stage, than anticipated at the time of the IPO.

The impressive growth in revenue is achieved with solid EBITDA-margin of 67%. This profitability level corresponds with the mid-term target for this segment, and illustrates the structural attractiveness of this business model.

1. In general, there are contractually agreed minimum monthly fees over the term of the contract, but, generally, the agreement also stipulates the conditions upon which a contract can be terminated
2. assuming that contracts are operational for 12 months in a given reporting year

Ekopak - Results for the six-months period ended 30 June 2022 - p. 3

Non-WaaS segment: 49% YoY (1H2022/1H2021) revenue growth and promising new business pipeline

As already demonstrated in the second half of 2021, Ekopak's strategic transition from non-WaaS to WaaS can involve business growth in both segments at the same time. This is rigorously reconfirmed in the 1st half of 2022, with a solid 49% YoY revenue growth.

Waterkracht and NextGen projects already yield a very promising order book

In January 2022, Ekopak announced its collaboration with PMV and Water-Link to convert each year the waste water from Antwerp households into 20 billion litres of cooling water for companies in the Port of Antwerp by 2025. The collaboration is named Waterkracht ('the power of water') and is a leading example of a public- private partnership. Upon formal establishment of the joint venture, Ekopak will have a 51% share. Ekopak will build and operate a water treatment plant in the Port of Antwerp, while piping installations are the responsibility of the joint-venture partner. In August 2022, Waterkracht announced a customer agreement with TotalEnergies, involving an annual purchase of 9 billion litres of process water. There is great interest from various companies in the Port of Antwerp to join this sustainable water project, which suggests that there is a good chance that the targeted annual production volume of 20 billion litres will be exceeded.

As mentioned, Ekopak will build and operate a water treatment plant in the Port of Antwerp. In June 2022, the company announced that it will take a plot of land under concession in the NextGen District in Antwerp where it will build the plant, that is scheduled to become operational by 2025. The NextGen plant will serve two purposes. On the one hand, the NextGen plant will process the water from the Antwerp households, for Waterkracht. On the other hand, Ekopak also offers neighbouring companies the opportunity to start a circular water supply project with Ekopak, separately from Waterkracht.

Both projects are on track to become operational as of 2025, as of which date they will generate robust secured revenue over a thirty-five year contractual life. A more accurate indication of the revenue contribution from both projects can be provided upon conclusion of negotiations, which are now at the final stage. Significant start-up costs for these and other new business projects have already been included in these half-year figures.

Geographic expansion: priority on structural revenue growth in French market

Revenue generated beyond the Belux home market now represents 10% of the group's total revenue (9% for 1H2021).

In August 2021, Ekopak announced the creation of Ekopak France with the aim of further expanding into the French market and meeting the high demand for sustainable water installations. In the meantime, Ekopak France is moving forward at a rapid pace and its branches in Lyon and Rouen are fully operational. In the first half of 2022, Ekopak France already contributed EUR 0.4 million to the group's revenue.

On September 16, 2022, Ekopak completed the acquisition of H2O Production, which helps to further strengthen Ekopak's business in the major French water treatment market. While revenue in other export markets is often driven by one-off opportunities, Ekopak is building a business platform in France that will drive structural revenue growth. H2O Production is located in Pithiviers, in the French department Loiret, and brings 20 years of expertise in several technologies applied for the production of demineralised

Ekopak - Results for the six-months period ended 30 June 2022 - p. 4