Intek S p A : The Interim Financial Report on Operations at June 30, 2020 of INTEK Group SpA is approved

Registered office: 20121 Milan (MI) - Foro Buonaparte 44

Share capital Euro 335,069,009.80, fully paid-up

Tax Code and Milan Companies Register no. 00931330583

www.itkgroup.it

PRESS RELEASE

• THE BOARD OF DIRECTORS OF INTEK GROUP SPA:
• • HAS APPROVED THE HALF YEAR FINANCIAL REPORT AS AT 30 JUNE 2020, WITH THE SEPARATE FINANCIAL STATEMENTS SHOWING THE FOLLOWING:

		(IN MILLIONS OF EURO)
		30/06/2020	31/12/2019
	NET INVESTMENTS	553,9	552,9
 NET FINANCIAL DEBT	53.0	49.2
	NET EQUITY	496.4	500.8
	NET PROFIT/(LOSS)	(4.2)	(3.0)

• KME GROUP:

EBITDA AS AT 30 JUNE 2020 WAS EURO 40.6 MILLION; 3.0% HIGHER THAN THE FIGURE OF THE FIRST HALF OF 2019 (EURO 39.4 MILLION)

• • CULTI MILANO:
    ITS GROWTH CONTINUES ALSO DUE TO A NEW ACQUISITION (SCENT COMPANY)
• HAS RESOLVED TO MEET BY AND NOT BEYOND THE FIRST TEN DAYS OF OCTOBER IN ORDER TO CONVENE THE SHAREHOLDERS' MEETING IN PREPARATION FOR THE PUBLIC EXCHANGE OFFER ON INTEK SAVINGS SHARES

* * *

The Board of Directors of Intek Group SpA (hereinafter also "Intek Group" or the "Company"), a holding of diversified investments with the objective of a dynamic management of its holdings, has approved today the half-year financial report as at 30 June 2020.

As at 30 June 2020, the net investments held by the Company amounted to Euro 553.9 million (Euro

552.9 million at the end of 2019), of which about 89% in the "copper" sector and the remaining in financial and real estate assets.

The Company maintains a sound financial structure: Net Equity as at 30 June 2020 amounted to Euro

496.4 million compared to Euro 500.8 million as at 31 December 2019. The change is to be attributed primarily to the results of the period, negative by Euro 4.2 million (negative by Euro 3.0 million in the first half of 2019).

Following are the main events that have characterised the Intek activities and those of its subsidiaries in the first half of 2020:

1. Bond loan 2020-2025

In February 2020, a bond loan in the amount of Euro 75.9 million, with a 5-year maturity and a 4.5% interest rate was finalised and requests, from the public offer of subscriptions and the exchange offer on the previous Intek bonds, were collected for Euro 92.6 million.

The financial revenue from this issuance have been allocated, together with those from the loan obtained from a credit institution for Euro 25.0 million and with the financial resources already held by Intek, to

1

the redemption of the Intek Group 2015-2020 bonds, maturing on 20 February 2020 and not used to participate in the Exchange Offer.

This transaction has made possible the optimization of the Intek indebtedness by extending its maturity and decreasing the costs.

1. KME

Gross operating profit (EBITDA) as at 30 June 2020 was Euro 40.6 million; it was 3.0% higher than the same figure in the first half of 2019 (Euro 39.4 million) Net operating profit (EBIT) amounted to Euro 19.7 million compared to Euro 16.6 million of the first half of 2019.

On 1 July 2020, the legal separation in KME Germany of the "Copper" and "Special" divisions became effective. The activities of the two businesses are now carried out by two separate legal entities, both controlled directly by KME SE: KME Germany GmbH and KME Special Products GmbH.

The situation related to Covid and the focus on the new legal entity have led the management of the company to pursue an acceleration of the cost optimisation measures adopted by KME Germany GmbH.

1. Culti Milano SpA

Part of this context is also, after the acquisition of the majority holding of Bakel Srl, the acquisition of Scent Company Srl, a company active in olfactory and sanitisation branding, with an investment of Euro 1.8 million.

In the first half of 2020, the consolidated turnover of Culti amounted to Euro 4.5 million, EBITDA reached Euro 0.6 million and EBIT Euro 0.3 million. These results do not include those of Scent Company since it was acquired in June 2020.

* * *

The investment sectors of Intek Group are currently:

• the copper sector, which includes the production and marketing of copper and copper-alloysemi-finished products, under the German subsidiary KME SE;
• the "financial and real estate assets" sector which includes the private equity business and the management of the receivables (tax receivables, non-performing loans and receivables arising from insolvency proceedings) and of real estate properties, as well as the investment in Culti Milano SpA.
• • * *

"Copper" sector

The "copper" sector, which refers to the subsidiary KME SE, is the largest investment of the Intek

Group.

Due to their wide field of application, the demand for copper and copper-alloysemi-finished products is very closely connected to the general economic performance in the reference markets.

The Consolidated turnover, net of the raw material amount, has decreased from Euro 281.5 million to Euro 247.1 million, a 12.2% decline. Gross operating income (EBITDA) as at 30 June 2020 was Euro 40.6 million; 3.0% higher than the figure of the first half of 2019 when it stood at Euro 39.4 million. Net operating income (EBIT) was Euro 19.7 million (Euro 16.6 million in the first half of 2019). Profit(loss) net of non- recurrent items was 0 (negative by Euro 3.9 million in the same period of 2019).

* * *

"Financial and real estate assets" sector

Within this sector, to be noted are the activities of Culti Milano, listed in the AIM market as from July 2017, which has extended its business from a company of fragrance products, within the room-fragrance (home, car, boats, etc.) segment to a company aimed at the well-being of the individual (perfumes, personal hygiene, cosmetics).

Activities aimed at maximising the value of the real estate properties held by the Group, also through Immobiliare Pictea, continued.

2

* * *

The main equity data of Intek as at 30 June 2020, compared with those as at 31 December 2019, are summarised in the following table.

Condensed separate statement of financial position

(in thousands of Euro)	30 June 2020	31 Dec 2019
Copper	494,123		89.21%	494,434	89.42%
Financial and real estate assets
Total Private Equity	1,635				1,580
Non-operating assets	10,529				9,952
Real Estate/Others	34,073				33,308
Culti/Other services	13,325				13,427
Total financial and real estate assets	59,562		10.75%	58,267	10.54%
Other assets/liabilities	213		0.04%	222	0.04%
Net investments		553,898		100.00%		552,923	100.00%
Outstanding bonds (*)	(76,427)				(106,000)
Net cash from third parties	18,951				53,914
Net financial debt of the holding company to third parties		(57,476)		10.38%	(52,086)	9.42%
Total equity		496,422		89.62%		500,837	90.58%

Notes:

• In the table, investments are expressed net of any financial receivable/payable transactions outstanding with the Intek Group.
• (*) including accruing interests.
• • * *

Equity

The net equity of the holding stands at Euro 496.4 million compared to Euro 500.8 million as at 31 December 2019; the change is to be attributed to the results for the period. Net equity by share amounted to Euro 1.15, unchanged versus the same figure as at 31 December 2019.

The Share Capital as at 30 June 2020 was unchanged compared to the same figure as at 31 December 2019, standing at Euro 335,069,009.80, divided into 389,131,478 ordinary shares and 50,109,818 savings shares. None of the shares have a nominal value.

As at 30 June 2020, Intek held 6,555,260 ordinary treasury shares (1.68% of the shares in this category), an increase of 841,688 securities following acquisitions carried out in March 2020. Also as at 30 June 2020, Intek held 11,801 savings shares (i.e. 0.024% of the capital in this category).

Financial management

Net financial debt of the holding company to third parties (excluding intra-grouploans and leasing liabilities) totalled Euro 57.5 million as at 30 June 2020. The balance as at 31 December 2019 was Euro 52.1 million.

* * *

3

Intek Group Consolidated Financial Statements

The profit/(loss) for the period, without any significant results from "Net income from investment management" was a negative Euro 4.6 million due primarily to net financial charges.

The consolidated financial position can be summarised as follows:

Consolidated net invested capital

	(in thousands of Euro)	30 June 2020	31 Dec 2019
	Net non-current assets	553,468		554,061
	Net working capital	11,228		11,130
	Net deferred tax	1,309		1,587
	Provisions	(710)		(930)
	Net invested capital	565,295		565,848
	Total equity	497,807		502,635
	Net financial position	67,488		63,213
	Sources of finance	565,295		565,848
	The change in net equity relates almost entirely to the results for the period.
	The details of the "Net financial position" are the following:
	Reclassified consolidated net financial position
	(in thousands of Euro)		30 June	31 Dec
		2020	2019
	Short-term financial payables		7,124	111,971
	Medium to long-term financial payables		5,091	4,996
	Financial payables to Group companies		401	3,232
	(A) Financial payables	(A)	12,616	120,199
	Cash and cash equivalents		(19,742)	(44,904)
	Other financial assets		(291)	(9,661)
	Financial receivables from Group companies		(282)	(2,421)
	(B) Cash and current financial assets	(B)	(20,315)	(56,986)
	(C) Consolidated net financial position (net of outstanding securities) (A) + (B)	(7,699)	63,213
	(D) Outstanding debt securities (net of interest)		75,187	-
	(E) Consolidated net financial position	(C) + (D)	67,488	63,213
	(F) Non-current financial assets		(2,664)	(2,664)
	(G) Total net financial debt	(E) + (F)	64,824	60,549

* * *

4