FORTEC Elektronik : Report 1st quarter FY 2022/2023

BIG ENOUGH

TO COMPETE -

SMALL ENOUGH

TO CARE.

QUARTERLY REPORT Q1 2022/2023

Quarterly Report Q1 FY 2022/2023

Contents

Preface Group Management Report Consolidated balance sheet

Consolidated Statement of Comprehensive Income Explanatory Remarks

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Preface

Dear Shareholders,

Despite the challenging macroeconomic environment, the FORTEC Group once again succeeded in achieving sustainable earnings growth in the first quarter of the 2022/2023 financial year. Group sales increased by 18% and EBIT by 23% compared to the previous year.

We have also completed the succession process for Mr Bernhard Staller (62) who will retire on 30th June 2023 for age reasons. The Supervisory Board has appointed Mr Ulrich Ermel (38) to the Management Board as Chief Operating Officer (COO) for a period of 3 years as of 1st March 2023. Ulrich Ermel has a wide range of management competence, leadership qualities and expertise in the Power Supply and Embedded sectors.

In order to guarantee a smooth transition, Bernhard Staller will remain in the company initially following the arrival of Ulrich Ermel. After handing over the business, Bernhard Staller will leave the Management Board on 30th June 2023 at the latest. We thank him for the steadfastly trusting and highly successful cooperation. Mr Staller has been instrumental in accelerating FORTEC's growth and expanding our position in the high-tech products sector.

In this quarter, we would once again like to thank our dedicated employees, whose passionate commitment has helped to ensure the success of our company in times of massive geopolitical uncertainty. We are working together to successfully counter the macroeconomic adversities and to continue on the growth path we have embarked upon. The high order backlog makes us confident that we will achieve our turnover and profit targets in the current financial year. However, due to the low visibility of further cost developments in certain areas, a valid forecast is only possible to a limited extent.

You can rest assured that we will continue to do everything in our power to ensure that FORTEC remains an attractive, future-oriented company that deserves your trust.

I wish you a peaceful Christmas season and health, happiness and success for the year 2023!

Sandra Maile

CEO

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Group Management Report: 1st quarter 2022/2023 01.07.2022-30.09.2022

Profit situation

Group turnover reached EUR 25.0 million and was thus almost 18% higher than the previous year's turnover (EUR

21.2 million). Sales of the high-margin industrial monitors in the data visualisation segment developed particularly dynamically compared to the same period of the previous year.

At EUR 0.8 million, other operating income almost doubled compared to the previous year. A positive special effect here is an increase in currency gains of around 500 thousand EUR compared to the same quarter of the previous year.

The cost of materials increased disproportionately from EUR 14.6 million to EUR 16.9 million in line with the higher turnover. The cost of sales ratio fell slightly to 68.3% (previous year: 69.9%).

Personnel expenses rose from EUR 3.2 million in the first quarter of the previous year to EUR 3.8 million as of 30th September 2022 due to generally higher personnel costs and more expensive new appointments. The personnel cost ratio decreased slightly from 15.2% in the previous year to 15.1% due to the increase in turnover.

At EUR 0.4 million, depreciation and amortisation was almost the same as in the previous year.

Other operating expenses rose significantly from EUR 1.4 million in the previous year to EUR 2.1 million due to a renewed increase in advertising and travel activities and higher currency losses. Relative to turnover, other operating expenses amounted to 8.4% (previous year: 6.7%).

The above factors resulted in a renewed increase in EBIT as a key financial performance indicator of around EUR

2.7 million, which is EUR 0.5 million above the previous year's figure of EUR 2.2 million. The EBIT margin thus rose slightly from 10.6% in the previous year to 10.9% in the first quarter of the 2022/2023 business year.

The net profit for the first quarter of the 2022/2023 financial year stood at EUR 1.9 million (previous year: EUR 1.7 million).

Earnings per share therefore rose slightly from EUR 0.53 to EUR 0.60.

The order book at the end of September amounted to EUR 98.6 million (previous year: EUR 68.6 million), around 40% higher than the previous year's value.

Asset situation

On the assets side, with a balance sheet total of EUR 74.7 million (30/06/2022: EUR 70.8 million), non-current

assets amount to EUR 17.9 million (30.06.2021: EUR 17.8 million). Of this figure, at EUR 7.0 million (30/06/2022: EUR 7.0 million) the goodwill from the acquired subsidiaries is the largest item.

Due to accounting in accordance with IFRS 16, rights of use amounting to EUR 5.2 million (30/06/2022: EUR 5.4 million) are reported. Under current assets, the largest item, with a value of EUR 31.5 million (30/06/2022: EUR 26.1 million), is the stocks standing at 42.2 % (30/06/2022: 36.8 %) of the balance sheet total. This is the result of the measures taken to safeguard inventories in the current difficult supply environment. At EUR 11.7 million, the item receivables from deliveries and services changed slightly compared to the previous quarter (30.06.2022: EUR 10.7 million). Cash and cash equivalents, the second largest item on the assets side, dropped slightly from EUR 12.9 million on 30/06/2022 to EUR 10.7 million.

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Financial and liquidity position

The Group's equity ratio is 69.9% (30/06/2022: 70.4 %). At EUR 52.2 million (30/06/2021: EUR 49.9 million), the Group has sufficient equity.

Under current liabilities, liabilities due to deliveries and services increased from EUR 6.5 million in the previous quarter to EUR 8.9 million.

Forecast

In the 2022/2023 business year, the Executive Board expects Group turnover in a range of EUR 91 million to EUR 97 million and a Group EBIT between EUR 8 million and EUR 9 million. Nevertheless, the forecast is subject to uncertainties due to the current geopolitical situation, which could have a significant influence on the forecast turnover and results development. The corresponding effects cannot be conclusively estimated at the current time.

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