ORIOR : Annual Report 2021

2021 ORIOR Group

ANNUAL REPORT

ORIOR ANNUAL REPORT 2021 | Letter to Shareholders

ORIOR - Excellence in Food

ORIOR is an internationally active Swiss food and beverage group. It represents a family of companies with a strong regional footing and popular brands and products that claim leadership positions in growing niche markets at home and abroad.

ORIORʼs decentralised business model allows every company in the Group to maintain their specific culture and identity, tailored to their workers and customers, and to create unique product, brand and concept worlds. They are joined together by a passion for culinary delights and true craftsmanship, a spirit of innovation directed towards market trends and needs, workforce entrepreneurship and strong common values.

Our management approach combines strategic thought and action at Group level with a high degree of autonomy at each centre of competence. The ORIOR 2025 Strategy with its strategic pillars and the Group-wide key strategic initiatives - the ground-breaking "ORIOR New Normal", the intradisciplinary "ORIOR Champion Model" and the synergistic "ORIOR Bridge-building" initiative - are important success factors that will ensure steady value creation for all stakeholders.

Motivated employees who enjoy what they do and who assume responsibility for themselves and their work are the catalyst for unlocking the extraordinary. We embrace uniqueness and premium quality in our claim to surprise our consumers time and again with delightful and delicious creations.

Our vision is nothing less than Excellence in Food.

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Contents

Letter to Shareholders	2
Interview with the CEO	6
ESG at ORIOR	8
Corporate Governance Report	11
Compensation Report	35
Financial Statements ORIOR Group	57
Financial Statements ORIOR AG	91
Share Information	103

ORIOR ANNUAL REPORT 2021 | Letter to Shareholders

Dear Shareholders

ORIOR, the internationally active Swiss food & beverage group, is pleased to present good results for the past financial year that were in line with its expectations, including best operational result ever. Challenges brought about by the coronavirus pandemic have not got easier and they continue to impact many of the Groupʼs business activities. On top of that, the absence rate increased due to quarantined employees. But: "We are moving in the right direction in every respect and delivering the desired results. Besides the substantial improvement in all items of the income statement and the significant strengthening of the balance sheet, we also made future-oriented achievements towards non-financial goals," says Daniel Lutz, CEO of ORIOR Group, commenting on the 2021 annual results.

Revenues with customers in the food services industry were still relatively flat but steady. In the travel food business (Casualfood), a clear trend reversal has not yet been observed - despite good results during the summer season. The Convenience segment showed impressive double-digit organic growth, fuelled by a positive trend in fresh pasta and very pleasing growth with plant-based specialities in domestic and especially foreign markets. Expansion of ORIOR's production capacity in this product segment will enable it to meet higher demand for these products over the long term. The International segment also showed good growth, thanks to the very pleasing performance of Culinor Food Group and Gesa. Revenues and earnings at the Refinement segment were temporarily but significantly impacted by the introduction to a new IT system. With respect to ESG, a new three-stage climate

2goal was formulated and instituted. Important elements of the new climate goal include emissions- reducing and efficiency-enhancing projects initiated as part of ORIORʼs site management and devel- opment strategy, for example investment projects to expand plant-based production capacity or the closure of two small production sites and their integration into larger production sites.

ORIOR Group generated revenues of CHF 614.1 million in the 2021 financial year, which corresponds to an increase of 2.3% from the previous year (2020: CHF 600.3 million). Reported revenue growth reflects organic growth of 2.0% and a currency translation effect of 0.3%. Gross profit rose 5.6%, primarily fuelled by the good revenue growth of the Convenience segment. The consolidated gross profit margin improved from 43.4% to 44.8%, which is back within the multi-year range. EBITDA surged 21.4% to CHF 64.1 million (2020: CHF 52.8 million), which lifted the EBITDA margin to 10.4% (2020: 8.8%). Key drivers of this pleasing development were the sales growth of high-margin prod- ucts, the lasting improvement in cost and process flexibility, Casualfoodʼs new financial basis and pandemic-related aid and relief provided by the German government. Despite a non-recurring, extraordinary impairment of CHF 1.6 million arising from the closure of production sites, EBIT amounted to CHF 35.4 million (2020: CHF 25.8 million). Net profit attributable to ORIOR AG shareholders is CHF 27.3 million (2020: CHF 21.8 million), which corresponds to an increase of 25.1%.

Operating cash flow for the 2021 financial year amounted to CHF 49.3 million (2020: CHF 52.3 million). This decline is primarily attributed to the pandemic-driven reduction in current assets in the previous financial year and the in- crease in inventory in 2021. A significant improvement in the Net debt/EBITDA ratio was achieved as planned, from 2.87x to 2.09x, thanks to the good operating results.

ORIOR Convenience segment with double-digit growth

The ORIOR Convenience segment with the Fredag, Le Patron, Pastinella and Biotta competence centres generated revenues of CHF 222.8 million, which represents a strong growth rate of 10.4% from the prior-year figure of CHF 201.8 million. This was mostly fuelled by its expanded range of plant-based products, with double-digit growth in Switzerland and especially abroad - which again strengthened Fredagʼs position as one of the most important plant-based manufacturers in Switzerland - and by very good sales of fresh pasta products as well as good sales

Rolf U. Sutter, Chairman of the Board of Directors (right) and Daniel Lutz, CEO ORIOR Group

of core Biotta products and new juice creations. The food service business (restaurants, wholesale channel, take- away, event catering, canteens, schools and school lunch programmes) showed very divergent trends during the

year under review. Business in the take-away channel was strong and even topped pre-pandemic levels, while the3 classic restaurant, canteens and school lunch channels showed only weak signs of normalisation overall. Event

catering revenues remained weak.

ORIOR Refinement segment falls short of expectations

The ORIOR Refinement segment with the Rapelli, Albert Spiess and Möfag centres of competence reported a 7.5% decline in revenues to CHF 246.8 million, which is less than expected. This is partly attributed to unforeseen challenges in the migration to a new IT system at Rapelli, which temporarily disrupted its supply chain and led to lost sales. At the same time, performance was affected by shifts in the product mix, also due to weak sales in the traditional restaurant channel, as well as by the high year-ago comparison base. Revenues at Albert Spiess and Möfag were in line with expectations. Innovative snack products, regional specialities and organic products sold very well during the period under review.

ORIOR International segment shows pleasing growth

The ORIOR International segment with the Culinor Food Group and Casualfood competence centres, Biottaʼs subsidiary Gesa, and Spiess Europe, a picking, packing and distribution platform for Group products, reported good growth of 7.9% y-o-y to CHF 167.0 million, which reflects organic growth of 6.8% and a positive currency translation effect of 1.1%. Culinor Food Group was the main driver of this good growth, thanks to new listings of innovative freshly prepared meals and the acquisition of new customers, which more than offset the still sluggish recovery in the restaurant channel. Gesa also performed quite well during the period under review. Casualfood, the competence centre specialising in travel food service, reported an only slight increase in revenues from the prior-year level. Its new financial basis and the aid and relief provided by the German government clearly supported its operating perfor- mance. Particular mention is made of the successful partial opening of the Berlin Airport. Casualfood will become the largest food and beverage operator at the new airport once Terminal 2 goes into operation.

The ORIOR Responsibility - new climate goal formulated

The decision to switch all of the Group's Swiss competence centres to green hydropower enabled ORIOR to achieve its initial climate goal earlier than expected, and actually exceed it by a significant margin. A new climate goal was developed in collaboration with external specialists, and it consists of three stages: In Stage 1, climate-neutral operations is targeted for all competence centres in Switzerland from 2022 on. In Stage 2, the operations of the entire