Ernst Russ : Annual Report 2021 (Geschäftsbericht 2021 in engl. Sprache)

ERNST RUSS AG

2021 ANNUAL REPORT

TABLE OF CONTENTS

Ernst Russ AG  | Annual Report 2021

TABLE OF CONTENTS

	Introduction by the Executive Board	8
	Supervisory Board report	10
	Share and investor relations	28
1.	Combined management report of Ernst Russ AG and the Group for the 2021 financial year	32
1.1.	Foundations of the Group and Ernst Russ AG	33
I.	Business operations	33
II.	Financial report	35
1.2.	Assets, financial position and earnings	38
I.	Assets	38
II.	Financial position	42
III.	Earnings	43
IV.	Overall statement on the course of business	45
V.	Assets, financial position and earnings of Ernst Russ AG and outlook	46
1.3.	Personnel	49
1.4.	Opportunities and risks	50
I.	Risk management system	50
II.	Opportunities	51
III.	Risks	53
1.5. Forecast	58
1.6. Other disclosures	60
	Declaration by the Executive Board in accordance with Section 312 (3) of the German Stock Corporation Act (AktG)	60
2.	Consolidated financial statements of Ernst Russ AG for the 2021 financial year	62
3.	Notes to the consolidated financial statements of Ernst Russ AG for the 2021 financial year	70
4.	Independent auditor's report	96

Annual Report 2021| Ernst Russ AGKEY FIGURES

KEY FIGURES

EARNINGS	UNIT		2021		2020		CHANGE IN %
Revenue	EUR million		92.3		55.6	66.0
Operating earnings*	EUR million		30.8		2.6	> 100.0
Earnings before taxes (EBT)	EUR million		26.7		5.4	> 100.0
Consolidated net income after non-controlling	EUR million		15.8		4.1	> 100.0
interests
* Determined in accordance with economic criteria
BALANCE SHEET	UNIT		31/12/2021		31/12/2020		CHANGE IN %
Total equity and liabilities	EUR million		263.7		163.4	61.4
Ship assets shown on the balance sheet	EUR million		210.2		119.7	75.6
Equity	EUR million		142.8		80.1	78.3
Equity ratio	%		54.2		49.0		5.2 percentage points
Cash at hand and bank balances	EUR million		26.4		9.2	> 100.0
EMPLOYEES	UNIT		2021		2020		CHANGE IN %
Average employee capacity	Full-time		42		63	-33.3
equivalent
Personnel expenses	EUR million		5.1		7.0	-27.1
Personnel expense ratio	%		5.5		12.6		-7.1 percentage points
KEY FIGURES SPECIFIC TO VESSELS	UNIT		31/12/2021		31/12/2020		CHANGE
Number of fully consolidated vessels			30		16		+ 14 vessels
Capacity	TEU		49,411		37,173		12,238 TEU
Capacity	DWT		692,525		528,813		163,712 DWT
		UNIT		2021		2020		CHANGE
Average charter rate	USD/day		15,038		8,669		6,369 USD
Technical availability	%		97.9		97.2		0.7 percentage points
Employment ratio	%		97.9		95.9		2.0 percentage points
SHARE	UNIT		2021		2020		CHANGE IN EUR
Earnings per share (undiluted)	EUR		0.49		0.12	0.37
Earnings per share (diluted)	EUR		0.49		0.12	0.37

2

3

KEYFACTS 2021

Ernst Russ AG  | Annual Report 2021

Annual Report 2021 | Ernst Russ AG

KEYFACTS 2021

AT A

GLANCE

As an international ship-owner and maritime investment manager, we regularly expand our fleet and secure stable

and sustainable earnings and added value for investors and shareholders.

30

vessels

(fully consolidated 31/12/2021)

15,038USD/

DAY

Average charter rate for the

ER fleet 31/12/2021

49,411 TEU

Container capacity of the ER fleet

31/12/2021

692,525 DWT

Capacity of the ER fleet

31/12/2021

97.9 %

Employment ratio of the

ER fleet in 2021

20.4 MONTHS

Average remaining term

of charterparties

1893

Establishment of traditional

ship-owner Ernst Russ

2005

Listed on the Frankfurt

Stock Exchange and the Hanseatic

Stock Exchange since 2005

2017

Listing in Scale segment of the

Frankfurt Stock Exchange

41

Number of employees

31/12/2021

9,200

shareholders as at 31/12/2021

32,434,030

Number of shares

54.2 %

Equity ratio as at

31/12/2021

MILLION

EUR92.3

Revenue

2021

MILLION

EUR210.2

Own ship assets

(carrying amount) 31/12/2021

4

5

MANAGEMENT TEAM

Ernst Russ AG  | Annual Report 2021

Annual Report 2021 | Ernst Russ AG

MANAGEMENT TEAM

MANAGEMENT

TEAM

THOMAS DEUTSCH

Head of Finance

ROBERT GÄRTNER

CEO

Thomas Deutsch has held an executive position in the Ernst Russ Group for over 13 years. As business director, he is responsible for the areas of accounting, tax, controlling, IT, business development and investor relations. He is also responsible for fund and asset management in the Ernst Russ Group. As authorised signatory and member of the management

team, he is involved in all the Group's operational and strategic decisions.

Before joining the Ernst Russ Group, Thomas Deutsch worked at one of the large, international auditing firms for seven years after completing his studies in business adminis- tration.

Robert Gärtner has been CEO of Ernst Russ AG since March 2019. He was a member of the Supervisory Board of the company from June 2016 to February 2019. In addition to his role as CEO, he is responsible for the Shipping segment.

As a trained industrial manager and company accountant, he has held numerous

financial management positions in both group and medium-sized companies over his 50-year career. Robert Gärtner joined INTERSCHALT maritime systems AG as a partner and member of the Executive Board in 2006. He led the company from supplying the ship-building industry to becoming a leading provider of software and services in the maritime industry.

6

7

INTRODUCTION BY THE EXECUTIVE BOARD

Ernst Russ AG  | Annual Report 2021

Annual Report 2021 | Ernst Russ AG

INTRODUCTION BY THE EXECUTIVE BOARD

INTRODUCTION BY THE

EXECUTIVE BOARD

Dear shareholders and valued busines s partners of Ernst Russ G,

Ernst Russ AG can look back on a very successful financial year in 2021. Due to the investments made and the sustainable employment concept for the fleet, the group of companies was able to benefit from the currently very pleasing trends in the international shipping markets.

Our personal and professional lives have been dominated by the COVID-19 pandemic for around two years now. As vaccination rates progress and in the hope that the pandemic will transition to endemic status, the outlook in this respect will become more positive again going forward. We are now watching the concerning events in Ukraine.

The Ernst Russ Group succeeded in expanding its fleet of fully consolidated vessels by 14 units in the 2021 financial year. In February 2021, the group of companies acquired the majority interest in two multi-purpose vessels each with a deadweight tonnage of around 12,500 tons. At the end of December, twelve container ships were also added to the scope of consolidation. This portfolio consists of eleven feeder vessels with a capacity of around 800 TEU and one container ship with a slot capacity of around 1,800 TEU.

The employment concept for the Ernst Russ Group fleet is geared to the sustainable securing of income over the long term. In the very positive environment, we were able to secure new charters for twelve vessels in our fleet in the 2021 financial year at very attractive rates and terms. The average charter rate was USD 15,039 per day throughout 2021. This corresponds to an increase of 73.6% year-on-year.

This very positive development is also reflected in the 2021 business figures of the Ernst Russ Group. In the reporting year, we increased our operating earnings by EUR 28.2 million to EUR 30.8 million thereby generating positive pre tax earnings of EUR 26.7 million. Consolidated net income after non-controlling interests was

up EUR 11.7 million to EUR 15.8 million. Revenue of EUR 92.3 million was well above the previous year's level. Our growth is also reflected in the increase in total equity and liabilities to EUR 263.7 million (previous year: EUR 163.4 million). Equity of EUR 142.8 million (previous year: EUR 80.1 million) produced an equity ratio of 54.2% (previous year: 49.0%).

The performance of our share price was also very encouraging in the 2021 financial year. An opening price of EUR 1.31 and a year-end rate of EUR 6.30 saw the value of the share increase almost fivefold in 2021. I would like to thank you, our shareholders, for the confidence you have placed in us. It goes without saying that our aim is still to increase the value of the share on a lasting basis and thus continue increasing your investment in Ernst Russ AG.

Against the backdrop of the current positive	With very best wishes - stay healthy!
trends in the shipping markets and the largely
secured employment situation of the Ernst Russ
Group's fleet for the 2022 financial year, we are
expecting revenue between EUR 160 million and
EUR 170 million and operating earnings (EBIT)
between EUR 62 million and EUR 67 million for
the 2022 financial year. Any future impact of the
Russia-Ukraine war on the global economy and	Robert Gärtner
the business activities of the Ernst Russ Group
has not been taken into account, as it is cur-	CEO of Ernst Russ AG
rently impossible for us to make reliable pre-	Hamburg, March 2022
dictions in this respect.
I would like to thank the Supervisory Board for its
consistently close and constructive cooperation. I
would also like to thank all our employees for their
commitment in these challenging times.

8

9