Gaztransport & Technigaz : 2021 Half-year results - Press release

H1 2021 results

Strong financial results and excellent commercial performance; annual targets confirmed

Key figures for the first half of 2021

• Revenues: 165.3 million euros and EBITDA: 96.5 million euros
• Core business: 26 orders (18 LNG carriers, two ethane carriers, six onshore storage tanks)
• LNG as fuel: 17 container ship orders
• Interim dividend of 1.35 euro per share

Highlights

• Excellent performance of the LNG market resulting in a large number of orders
• Continued development of LNG as fuel
• Approval of new technologies highlighting the dynamism of GTT's R&D

Outlook for 2021

• 2021 targets confirmed in terms of revenue, EBITDA and dividend

Paris - July 28, 2021. Gaztransport & Technigaz (GTT), a technology and engineering company specialising in the design of membrane containment systems for maritime transportation and storage of liquefied gas, today announces its revenues for the first half of the 2021 financial year.

Commenting on these results, Philippe Berterottière, Chairman and Chief Executive Officer of GTT, said: "With 18 orders for LNG carriers, two orders for ethane carriers and six orders for onshore storage tanks, the commercial performance achieved in the first half of 2021 was excellent for our core business. On top of this, nine LNGC orders were recorded in July, which shows that the market dynamic remains very positive. In addition, Qatar's decision in February this year to invest in a new gas liquefaction plant, as well as the various other liquefaction projects under construction, represent significant order potential for LNG carriers.

New orders for LNG as fuel were also recorded during the first half. The order for 12 container ships in May 2021, which follows those for nine vessels in 2017 and five in 2019, confirm the adoption of GTT technology by CMA CGM for the liquefied natural gas propulsion of its vessels. The order from SHI on behalf of Seaspan for five container vessels fuelled by LNG, which are compatible with ammonia, further reflects the efficiency and appeal of our solutions to support the energy transition ship-owners.

In terms of innovation, activity is intense. For the second year in a row, GTT is the leading French mid-sized company in terms of the number of patents published by the INPI. During the first half of the year, we obtained several approvals from classification societies to develop new innovative technologies in a wide variety of areas, such as improving the performance of our NO technology or designing a ballast-free bunker vessel. GTT maintains a constant effort on R&D to meet its customers' energy transition needs and the increased requirements they face.

From a financial standpoint, revenues for the first half of 2021 are in line with our expectations. They were down 19% compared to H1 2020, which recorded an exceptionally high level following particularly strong order intake, however were up 35% compared with H1 2019. Margin levels achieved in the first half of 2021 are similar to those of the first half of 2019 and we are continuing to manage the Group with strict cost control.

Considering the level of our backlog and shipbuilding schedules, we are confirming our full-year targets for 2021".

1

Business activity

- Strong order intake for LNG carriers and ethane carriers

In the first half of 2021, GTT's business activity was marked by multiple successes, particularly in the field of LNG carriers. With 18 new orders recorded for LNG carriers in the first half of 2021, GTT's core business posted very satisfactory sales results. On top of this, nine new orders for LNG carriers were recorded in July. All of the carriers will be equipped with GTT's recent technologies (Mark III Flex+, Mark III Flex and NO96 GW). Delivery is scheduled between the first quarter of 2023 and the third quarter of 2025.

In April 2021, GTT also received an order from Hyundai Heavy Industries (HHI) for the design of the tanks of two very large ethane carriers (VLEC), with total cargo capacity of 98,000 m3, on behalf of an Asian ship-owner. The tanks will integrate GTT's Mark III membrane containment system. Delivery of the vessels is scheduled for the fourth quarter of 2022 and the first quarter of 2023.

- Six orders for onshore storage tanks

On May 24, 2021, GTT announced that it had received an order from China Huanqiu Contracting & Engineering Co. Ltd. (HQC) for the design of four large integral membrane onshore LNG storage tanks, and then on June 3, 2021, a second order from China Chengda Engineering Co., Ltd. (Chengda) for the design of two additional large tanks.

GTT will design these membrane storage tanks with a total capacity of 220,000 m3 using the latest generation GST® technology. These orders are part of the new cooperation agreement signed in March 2021 between BGG and GTT for the Tianjin Nangang LNG terminal.

- New orders in LNG as fuel

GTT received orders to equip 17 vessels with LNG as fuel in the first half of 2021. The first order received from the Chinese shipyards Hudong-Zhonghua Shipbuilding (Group) Co. Ltd. and Jiangnan Shipyard (Group) Co, on behalf of CMA CGM, includes the equipment of 12 ultra large container vessels fuelled by LNG. A second order received at the end of June from Samsung Heavy Industries, includes the equipment of five very large container vessels of the Asian ship-owner Seaspan, a subsidiary of Atlas Corp and of the Israeli charterer ZIM. The vessels will be equipped with a Mark III membrane tank, adapted in order to be compatible with ammonia.

• Smart Shipping: an innovative solution to improve the bunkering process
  Ascenz, GTT's Singapore-based Smart Shipping company, announced on 23 July 2021 that it has launched the Electronic Bunker Delivery Note (eBDN ) solution to improve the efficiency and transparency of the bunkering process. Ascenz's solution contributed to the success of the world's first live bunker delivery financing pilot. The operation was led by DBS Bank, in partnership with Trafigura Group's marine fuels supply and procurement joint venture TFG Marine, Ocean Network Express (ONE) and Ascenz, with the support of the Maritime and Port Authority of Singapore (MPA).
• An iconic contract for Elogen

On April 12, 2021, Elogen announced the signing of a contract with German energy company E.ON, as part of its major SmartQuart project. Elogen will supply E.ON with a 1MW-containerized electrolyser with a production capacity of 200 m3 of hydrogen per hour. The electrolyser will be equipped with a transformer and a compression unit. The integration of this equipment will allow the electrolyser to produce hydrogen for multiple uses. The electrolyser will be delivered to the Kaisersesch site in Germany and commissioned in the second half of 2022. The partnership also provides for the development by Elogen of a hydrogen purification unit. Designed by Elogen's teams in Les Ulis, France, this innovative equipment will be installed in the electrolyser delivered by Elogen to E.ON. It will achieve a purity level of 99.999%.

This order reflects Elogen's determination to lead the way in hydrogen system R&D.

2

In the first half of 2021, Elogen achieved €2.5 million in revenues and €4.6 million in order intake.

Development of new technologies - GTT champion in number of patents published

For the second year in a row, in 2020 GTT ranked first in the list of medium-sized companies filing patents published by the INPI. This ranking confirms GTT's strong innovation capacity. Innovation is at the heart of the Group's strategy, in all its activities, to help customers address decarbonisation issues.

In the first half of 2021, GTT received many approvals from classification societies, thereby enabling it to enter a new phase to meet its customers' needs.

• In early 2021, GTT received approvals in principle from the classification societies Bureau Veritas and DNV for the application of its NO96 containment system on the tanks of large-capacity container ships.
• On February 15, 2021, GTT obtained two approvals in principle from Bureau Veritas. The first relates to the "NH3 Ready" (compatible with ammonia) classification of Mark III membrane tanks. The second approval relates to the design pressure raised to "1 barg" for LNG fuel applications such as large-capacity container ships. This approval gives greater flexibility to ship-owners in all their operations.
• On April 6, 2021, GTT has obtained approval in principle from Bureau Veritas related to the use of a digital solution for sloshing1 activity assessment in order to optimise the LNG membrane tank maintenance frequency. Combined with an appropriate risk analysis, this solution can support Alternative Survey Plans aiming at optimising the tank maintenance while complying with strict safety standards. This will translate into increased operational flexibility and substantial cost saving for the ship-owners.
• On July 1, 2021, GTT announced that it had received the final approvals from three classification societies for its NO96 Super+ technology, an evolution in the cargo containment system. With this innovation, GTT delivers a solution to reduce cargo evaporation, NO96 Super+ guaranteeing ship- owners a daily boil-off rate (BOR) of 0.085% for standard LNG carriers.
• On July 8, 2021, GTT announced that it had received, in partnership with the Hudong Zhonghua Shipbuilding Group Co. (HZ) shipyard, a dual approval in principle from the classification societies China Classification Society (CCS) and DNV, for the design of a ballast-free LNG bunker and refuelling vessel. The granting of such approvals recognises the compliance of this technology innovation with the rules and codes for sea-going vessels, their construction and equipment. The ballast-free design, equipped with GTT's membrane system, enables to build vessels that are more energy efficient and more respectful of the environment.

Order book at June 30, 2021

On January 1, 2021, GTT's order book excluding LNG as fuel comprised 147 units, and subsequently changed as follows:

• Deliveries completed: 30 LNG carriers, five ethane carriers, one FSRU
• Orders received: 18 LNG carriers, two ethane carriers, six onshore storage tanks

1Liquid sloshing in tanks

3

At June 30, 2021 the order book excluding LNG as fuel, stood at 136 units, split as follows:

• 110 LNG carriers;
• 6 ethane carriers;
• 2 FSRUs2;
• 2 FSUs;
• 1 FLNG;
• 3 GBS;
• 12 onshore storage tanks.

Regarding LNG as fuel, with the deliveries of 6 ultra large container ships (5 for CMA CGM and 1 for Hapag Lloyd) and the orders received for 12 CMA CGM container ships and 5 Seaspan container ships, the number of vessels in the order book stood at 25 units at June 30, 2021.

Change in consolidated revenues for the first half of 2021
	(in thousands of euros)	H1 2020	H1 2021
	Revenues	203,767	165,286
	Of which new builds	197,739	153,885
	Of which hydrogen electrolysers		2,466
	Of which services	6,027	8,935

Consolidated revenues for the first half of 2021 were 165.3 million euros, down 18.9% compared to the first half of 2020.

• Revenues from new construction amounted to 153.9 million euros, down 22.2% compared to the first half of 2020, which fully benefited from order intake in 2018 and 2019.

1. Royalties from LNG and ethane carriers amounted to 132.5 million euros, those from FSRUs to

7.0 million euros, those from FLNGs to 1.5 million euros and those from onshore storage tanks to 0.6 million euros.

• 1. Other royalties were up significantly compared to the first half of 2020. These mainly include royalties from new applications, such as LNG as fuel for 4.7 million euros (up 27.1%), FSUs for 5.9 million euros and GBSs for 1.7 million euros (+68.5%).
• Revenues from Elogen's electrolyser business amounted to 2.5 million euros.
• Revenues from services rose sharply by 48.2% to 8.9 million euros in the first six months, driven by strong growth in all service activities (maintenance and work on vessels in operation, supplier certification, pre-engineering studies and training), most of which benefited from a easing of travel restrictions. The integration of OSE Engineering also contributed to the increase in services.

2 Following the cancellation of an FSRU ordered in June 2020

4

Analysis of the consolidated income statement for the first half of 2021
Condensed consolidated income statement
	(in thousands of euros, except for earnings per		H1 2020			H1 2021
	share)
Revenues	203,767			165,286
Operating income before depreciation and	136,553			96,478
amortisation of fixed assets (EBITDA3)
EBITDA margin (on revenue, %)	67.0%			58.4%
Operating income (EBIT4)	133,870			92,851
EBIT margin (on revenue, %)	65.7%			56.2%
Net income	115,527			76,564
Net margin (on revenue, %)	56.7%			46.3%
Net earnings per share5 (in euros)	3.12			2.07

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) amounted to 96.5 million euros in the first half of 2021, down 29.3% compared to the first half of 2020. The EBITDA margin on revenues was 58.4%6 in the first half of 2021, down compared to the outstanding level of the first half of 2020 (67.0%), but up compared to the first half of 2019 (57.8%). Operating expenses were stable overall, as the impact of acquisitions was offset by a decrease in expenses at GTT SA. External expenses were slightly down (-0.4%) compared to the previous half- year, due in particular to the decrease in subcontracting and studies (-17.7%) and travel expenses (-13.2%), which more than offset some one-off external consulting expenses. Personnel expenses were slightly increasing (up 0.6%), which is attributable in particular to the headcount related to the companies acquired in 2020, while the profit-sharing item was down 21.4%.

Operating income amounted to 92.9 million euros in the first half of 2021, i.e. a margin on revenues of 56.2%, compared to 133.9 million euros in the first half of 2020.

Net income fell from 115.5 million euros in the first half of 2020 to 76.6 million euros in the first half of 2021 and the net margin came to 46.3%.

Other consolidated financial data
	(in thousands of euros)	H1 2020		H1 2021
	Capital expenditures	(6,994)		(6,115)
	(of which acquisitions of non-current assets)
	Dividends paid	(64,873)		(65,951)
	Cash position	199,049		164,207
	Change in cash (vs. 12/31)	+30,033		+22,466

As of June 30, 2021, the Group had a positive net cash position of 164.2 million euros.

3EBITDA corresponds to EBIT excluding depreciation and amortisation of non-current assets. 4EBIT stands for Earnings Before Interest and Tax.

1. In the first half of 2021, earnings per share were calculated based on the weighted average number of shares outstanding (excluding treasury shares), i.e. 36,960,391 shares.
2. EBITDA margin of 60.6% at constant scope, i.e. excluding the impact of acquisitions

5