EL En S p A : The Bod of El.En. releases the financial report The Bod of El.En. releases the financial report

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3.1 REGEM

Press release

The Bod of El.En. releases the financial report

as of September 30th 2020

Excellent revenues recovery

Revenues: 268.2 million of euro

EBITDA: 25.8 million of euro, 9.6% on revenues

EBIT: 18.1 million of euro, 6.8% on revenues

Income before taxes: 16.9 million of euro

Main consolidated figures as of September 30 2020

• Consolidated revenues: 268.2 million of euro vs. 282.9 million of euro in 2019 (down 5.2%)
• EBITDA: 25.8 million of euro (down 21%) vs. 32.6 million in 2019
• EBIT: 18.1 million of euro (down 31.4%) vs. 26.4 million of euro in 2019
• Income before taxes: 16.9 million of euro ( down 38.9%) vs. 27.6 million of euro of 2019
• Net Financial Position: positive and increasing to 49.8 million of euro vs. 27.9 million of euro as of

June 30th 2020 and 61.4 million as of December 31st , 2019

• Main consolidated figures of the third quarter
• • Consolidated revenues: 105.6 million of euro vs. 94.5 million of euro in Q3, 2019, ( up 11.8%)
  • EBITDA: 11.3 million of euro (10.7% margin) vs. 12 million of euro in Q3 2019, (down 6%)
  • EBIT: 8.8 million (8.4% margin) vs. 9.7 million of euro in Q3 2019, (down 9.1%)
  • Income before taxes: 7.9 million of euro (7.5% on sales), was 10.7 million of euro in Q3 2019, (down 26%)

Firenze, November 13th, 2020 - The Board of Directors of El.En. SpA, leader in the laser market and listed on the STAR segment of the Italian Stock Exchange, released today the nine months financial report as of 30 September 2020 which showed consolidated revenues for 268.2 million of euro, a decrease of approximately 5.2% compared to 282.9 million euro in the same period of 2019, exclusively due to the effects of the Covid 19 pandemic, and an operating result of 18.1 million of euro, down by 31.4% compared to the 26.4 million euro in the same period of 2019.

In the third quarter of 2020 the Group registered excellent results in absolute terms, outstanding in relation to the period in which they were obtained: quarterly revenues were 105.6 million, an increase of 11.8% compared to the corresponding quarter of 2019 and EBIT for the quarter was 8.8 million of euro, equal to 8.4% of revenues.

Gabriele Clementi, President of El.En. Spa remarked: "We are pleased with the results achieved in the 3rd quarter especially in consideration of the still difficult situation for the world economy and after the first half when we were heavily penalized by the lockdown. We can confirm a gradual,

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albeit slow, recovery in volumes of demand and results, very satisfactory indeed in consideration of the circumstances, which could however suffer further pauses linked to the very recently imposed lockdowns. The economic and financial results once again highlighted the solidity and vitality of the group, and the ability of our organization to react amid such a critical and adverse period. We can't hide our satisfaction, and thank the colleagues of all the companies in the group for their commitment at this particular moment in carrying out their tasks with renewed determination and great effectiveness, timely completing all the scheduled commitments and addressing several new ones".

For what concerns sales volume, the recovery in the industrial sector has been very robust, especially in the sheet metal laser cutting segment. The Chinese companies Penta Laser of Wenzhou, Wuhan and Lin Yi and Cutlite Penta of Prato operate in this segment. Their result in terms of quarterly sales marked an excellent 38% growth compared to the third quarter of 2019. Demand in this segment remains strong, driven by product innovation with improved system performance that allows for increased adoption in certain applications until now dominated by other technologies. The Group's companies gained market share thanks to the excellent cost-performance ratio of the offered systems, even if the strong post-lockdown demand in China displayed considerable market competition, with the effect of a sales margins reduction. In China, the conditions for daily and work activities almost completely returned to normal, from several weeks. There have been no further lockdown, internal travel has no limitations, masks are no longer worn even; only a strict quarantine imposed on incomers, aimed to preserve the level of infections that had been substantially zeroed for a few months.

In Japan, another relevant country for the Group, the negative impact of Covid was and continues to be modest, lockdowns have taken on very limited local and temporal connotations. Business in the medical and beauty sector benefited from this reduced impact, and taking advantage of the effectiveness of our direct distribution network, recorded a double-digit turnover growth in 2020.

In the medical sector at the end of the quarter operations recovered to excellent operating volumes in line with expectations and pre-Covid growth plans, marking a 1.4% quarterly growth.

Still affected by the bad performance of the first half of the year hit by the downturn due to the spread of the pandemic, albeit decreasing, the decline in revenues over the nine months persists in all sectors and in almost all the main application segments in which the Group is active, marking an overall 5,2% decrease in turnover.

The medical sector underwent an overall decline of 6.4% while the industrial sector recorded a contraction of 3.3% thanks to the marked recovery in the quarter compared to the first six months of the year in which the sales volume decrease had been equal to 13.8% .

The medical sector registered revenues for of approximately 160 million of euro in the nine months, compared to 171 million of euro in the same period of 2019. Sales in the nine months recorded a decline of approximately 6.4%, slightly more accentuated in systems sales compared to after-sales services and consumables sales which benefited from the positive trend in revenues for optical fibers for urological surgery.

In the circumstances, the Medical Aesthetics segment registered an excellent sales performance, with revenues remaining stable compared to 2019. This was achieved by the success in the launch of several highly innovative new systems for hair removal, body and skin treatments, and by the ability of the Japanese branch to capitalize on the effectiveness of its distribution by strengthening the installed base with functional upgrades and conveying interesting volumes of locally produced equipment through the same channels.

The industrial sector reported, in the first 9 months of 2020, revenues of 108.4 million euros compared to 112.2 million euros in 2019 with a 3.3% decrease compared to 2019. The delay accumulated due to the impact of Covid in China and Italy was almost completely recovered with an extraordinary 28.8% growth in the third quarter compared to the third quarter of 2019. The best

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result emerges in the laser cutting sector which recorded a turnover of 87.4 million of euro compared to 85.4 million in the first 9 months of 2019.

The decline in the group's turnover generally affected all the geographical areas in which the Group is active. In the nine months of 2020, the weakest performance was recorded in the European countries, which recorded an 11.0% decrease compared to the first 9 months of 2019. While Italy and the Rest of the World showed a decrease of 3% and 4% respectively compared to the first 9 months of 2019.

Gross margin for the nine months was 94.4 million of euro, down by approximately 15% compared to the 111.1 million of euros as of 30 September 2019, due to the decrease in turnover and the reduction in margins on sales in the two application sectors.

EBITDA for the first nine months was positive for 25.8 million of euro, down on the 32.6 million of euro as of September 30, 2019.

EBIT at the end of the 9 months of 2020 showed a positive balance of approximately 18.1 million of euro compared to the 26.4 million of euro of 30 September 2019, with a 31.4% decrease and a 6.8% EBIT margin compared to 9.3% of the previous year. In the third quarter, EBIT margin was 8.4%.

The 9-monthspre-taxincome was positive for 16.9 million of euro, down 38.9% compared to 27.6 million of euro at 30 September 2019, with a 6.3% impact on sales.

Cash generation was excellent in the quarter. The net financial position of the Group at 30 September 2020 was positive for 49.8 million of euro. In the nine months, the net financial position decreased by approximately 11.6 million of euro from to the 61.4 million euro balance a as of December 31 2019, while it increased by approximately 21.9 million form the 27.9 million balance as of 30 June 2020.

Subsequent events

Starting in November, lockdowns were imposed, among others, in Italy, Germany, France and Great Britain, with a direct impact on the activities of beauty centers and to some extent on medical centers, and indirect impact on all economic activities as an effect of mobility restrictions.

Business outlook

The trend in the third quarter confirmed our forecast of a progressive improvement for the second half of the year and showed a rapid acceleration in turnover and order acquisition. The nine-month results and the trend in October would exceed the guidance provided at the release of the six months results, which envisaged to contain within 10% the decrease in 2020 consolidated turnover compared to 2019 and to improve EBIT margin in the second half. In light of the very recent explosion of infections and the subsequent restrictive measures enforced in Italy and Europe that already caused a new slowdown in sales in certain segments and markets, the prospects for the latter part of the year are now much more uncertain. Trusting that any further restrictions will not alter the overall demand conditions, the current guidance is confirmed.

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The manager in charge of preparing the corporate accounting records, Enrico Romagnoli, declares, pursuant to paragraph 2, article 154-bis of the Consolidated Finance Law, that the accounting disclosures provided in this document correspond to the accounting records, books and entries.

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As required by Consob, the Quarterly report as of September 30th , 2020 will be available for the public at our premises in Calenzano, at Borsa Italiana S.p.A., on our website www.elengroup.com("Investor Relations / Documenti Finanziari / Relazioni e Bilanci / 2020") from November 13th, 2020 and on authorized storage website www.emarketstorage.com.

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CONFERENCE CALL

This Monday, November 16th 2020, at 15.00 CET (14:00 GMT) (9:00 AM EST), El.En. S.p.A. will hold a videoconference call discussing the group's financial results. The following link can be used to participate

https://us02web.zoom.us/j/89962044227?pwd=dHFjSEVrdzJ1YU1HUFI3ZElNLzIrQT09

Meeting ID: 89962044227

Password: 673559

OR you can dial one of the following phone numbers:

[phone] Italy (toll)

[phone] Italy (toll)

[phone] Italy (toll)

[phone] US (toll)

[phone] US (toll)

[phone] US (toll)

[phone] US (toll)

[phone] US (toll)

[phone] US (toll)

Prior to the videoconference a presentation will be available for downloading on the Investor Relations page of El.En.'s website.: http://www.elengroup.com/it/investor-relations/presentazioni

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