Friedrich Vorwerk : 03/2024 Earnings Call FY 2023

Driving the clean energy transition.

Earnings Call FY 2023

H

March 26, 2024

H

Market update

5

The recently confirmed GDP Electricity foresees investments of >320 bn € until 2045

"

This is the first network development plan that presents the electricity network we need to complete the energy transition. We have carefully assessed all the projects that were proposed.

We need to build a significant number of additional lines by 2045 to achieve a climate-neutral electricity system,""

Klaus Müller

President, Federal Network Agency (Bundesnetzagentur)

+4,800 km

New electricity lines*

+2,500 km

reinforced electricity lines*

+5

new HVDC transmission lines each with a capacity of 2 gigawatts*

320 bn €

Investments in the German electricity transmission network by 2045

6

• As compared to the current Federal Requirements Plan ("Bundesbedarfsplanung")

By approving 24 hydrogen projects, the EU paves the way for the German hydrogen economy

Commission approves up to €6.9 bn of State aid by seven
Member States for the third Important Project of Common
European Interest in the hydrogen value chain		"
	IPCEI Hy2Infra
	H2 Projects Germany
	Important Project of Common
	European Interest	33	4.6bn €	+ 3.4bn €	24
6.9bn €
Total public funding		projects	Public funding	Private Funding	projects
by the member states	across member states	by the Government	by companies	in Germany
3.2GW 2,700km 370GWh	Projects in Lower Saxony and Hamburg
Electrolysers	Pipelines		Storage facilities	HyPerLink	Lingen Green	GetH2
					Hydrogen
Jointly prepared by 7 Member States
FR IT	PT NL	PL SK GER	Clean Hydrogen	HH Win	AquaDuctus
Coastline

7

The IPCEI approval is an important step towards the German Hydrogen Core Grid ("Kernnetz")

German Hydrogen Core Grid (Kernnetz)

• Act on hydrogen grid planning and core grid financing passed

Federal Minister Habeck: "The foundation stone for the future of hydrogen

has been laid. The development of the hydrogen network is picking up	"
speed in Germany.
9,700 km
Total grid length
40%	vs.	60%
New pipelines		Converted pipelines

19.8 billion €

Total envisaged investment volume

2024-2032

Planned time for realizing the core grid with the first hydrogen flowing as early as 2025

Converted Pipeline
New Pipeline	8

H

Financial performance FY 2023

9

As expected, Q4 revenues came out slightly below the very strong previous year's level

Revenue

in €m

-10%
109,4
	98,2
Q4 22	Q4 23

Typical seasonal revenue development

-10%

Revenue development y-o-yin Q4 2023

10

Despite last year's rapid growth, revenue in FY 2023 showed a moderate y-o-y increase

Revenue		Revenue by segment
in €m		in %
	+1%
368.2	373.4	368.2	373.4
		27 %	32 %
		8 %	7 %
		15 %	17 %
		50 %	44 %
FY 2022	FY 2023	FY 2022	FY 2023

Adj. Opportunities

Clean Hydrogen

Electricity

Natural Gas

+1.4 %

Revenue growth

y-o-y FY 2023

>2.8

Book-to-bill ratio

FY 2023

11

At the same time, profitability could be improved significantly compared to Q4 in the previous year

EBITDA

in €m, blue bubbles show EBITDA margin

6.5%	11.8%
	+64%
	11.6
7.1
Q4/22	Q4/23

EBIT (adj.)

in €m, blue bubbles show EBIT margin

2.4%7.1%

	+165 %
	6.9
2.6
Q4/22	Q4/23

11.8 %

EBITDA margin

in Q4 2023

7.1 %

EBIT margin

in Q4 2023

12

Without one-off effects, we have seen continuous margin improvements over the year

EBITDA

in €m, blue bubbles show EBITDA margin

		13%
				12 %
8 %	9 %
		6 %
				11.6
		7.4		One-off project-
			related provision
	8.0
5.6
	6.8
Q1/23	Q2/23	Q3/23	Q4/23

+4 PP

EBITDA Margin

Q4/23 vs. Q1/23

13