Miko N : Annual report 2021

REPORT2021ANNUAL AARVERSLAGMIKO

JAAR VERSLAG ANNUAL REPORT

www.mikogroup.be

TABLE OF CONTENTS

Message from the CEO	3
Miko in 2021	6
Annual Report	7
Heritage	8
Mission Statement	12
Strategy Miko	13
Group structure	14
Analysis of Results	15
Activities	28
Highlights 2021	33
Human Resources - Our People	40
Miko Share - Stock market information	43
Corporate Governance Report	45
Results and proposal for appropriation of result	77
Corporate Social Responsibility	78
Consolidated Figures	82

MIKO ANNUAL REPORT 2021

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MESSAGE FROM THE CEO

Dear shareholders,

As we write this foreword, the Russia-Ukraine war is leaving a trail of human and economic destruction in our backyard. It overshadows our historic tipping year of 2021, which will undoubtedly have a central page in our history books, and not just because Miko celebrated its 220th anniversary. Yes, the Miko group has reached a beautiful, round and blessed age, but, as this report will show, remains young and dynamic in action.

Indeed, a radical strategic reorientation took place in the first quarter of 2021 with the sale of the plastic processing division to the German plastic packaging group PACCOR.

Miko traditionally performed 2 core activities: plastic packaging and coffee service.

Both were fully independent and had their own investment needs. Because there was only one investment portfolio, and in order to allow both departments to realize their own growth ambitions, it was decided to look for a buyer. A very good match was found with the German company PACCOR. It is successful in the same market segments as Miko Pac, with a broad product range, a wide range of production techniques and R&D initiatives.

The strategic focus thus becomes entirely on coffee, and financial resources generated from the sale of the plastic is predestined to deliver external growth.

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MESSAGE FROM THE CEO

Soon this led to a 92% participation in the Dutch MAAS coffee. The remaining shares came into the hands of the management.

MAAS, which is located in Eindhoven - Netherlands, pre-COVID achieved sales of 70 million Euros with about 500 employees. It places coffee and vending machines, especially at large companies, public institutions and universities. Together with the already present Dutch subsidiary Miko Koffie Service, Miko now finds itself in the top 3 of coffee service companies in the Netherlands.

The next acquisition was not long in coming. In November Miko took over SAS, based in Beerse. With some 100 employees, this coffee roaster achieves a turnover of around 35 million euros.

Whereas Miko Koffie focuses on the out-of-home market, such as companies, institutions and the hospitality sector, SAS strengthens our presence on the private label market aimed at retail with, among other things, a wider product range. SAS is also just a stone's throw away from Miko's roasting house. Within 3 years, a new modern roasting house will be built in Turnhout on a site of 50.000 m2. This will allow both companies to be united and production to be made more efficient.

And our 2021 results? They are definitely satisfactory. Despite the fact that COVID never really left our regions alone, we were able to resume significant growth.

The turnover of the coffee service division increased by 56% to 146.3 million euros. Without the aforementioned acquisitions, the growth would still have been 15%.

And after eliminating the results of the plastics division and all elements associated with the sale of that division, EBIT and EBITDA increased, by 2,642% and 72% respectively, to 6.5 million euros and 20.09 million euros. Net income evolved from a net loss of 1.1 million euros in 2020 to a net profit of 4.1 million euros in 2021.

Without the above adjustments, total EBIT, EBITDA and net profit amounted to €49 million, €63.3 million and €46.6 million, respectively.

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MESSAGE FROM THE CEO

And the future?

Challenges are certainly there. Externally, there's the tight labor market, unstable global supply lines, further COVID surges outside Europe, yo-yo movements in commodity prices, increased energy prices, the uncertain impact of the situation in Ukraine... But during our 220 years of existence, we've already been in front of hotter fires.

Internally we also face many challenges, not least the integration of the recent major acquisitions. Getting ready for "The Great Migration", the merger of Miko and SAS into one modern distillery. This complex process will take several years and will have to be meticulously prepared step-by-step. And also deepen the cross-pollinations with MAAS, where there are already cross-border commercial opportunities for Belgium and the Netherlands and where there is already a significant transfer of knowledge regarding our IT and HR.

And a challenge that we should not forget either: we were able to sell our plastics processing division at very attractive terms and in this way built up a nice savings pot for further external growth... And that cash is not empty yet.

Because substantial COVID subsidies may be recovered from several foreign subsidiaries if Miko pays a dividend, the Board of Directors proposes not to pay a dividend for the year 2021.

THANK YOU

Dear Employees, Finally, we would like to take this opportunity to thank you all for your efforts during 2021. What a year! First our company halved, then doubled again, and that in less than 9 months! This is only possible with you as motivated, energetic and loyal partners. We are proud to have you on our team. Thank you very much.

Frans Van Tilborg Karl Hermans

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