Ramada Investimentos e Indústria S A : Indústria, S.A. announces Financial Statements for the 1st Quarter 2020

Earnings Announcement

1st Quarter 2020

(unaudited)

This document is a translation of a document originally issued in Portuguese, prepared using accounting policies consistent with the International Financial Reporting Standards as adopted in European Union (IFRS-EU), some of which may not conform or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.

80 ANOS

A investir na indústria

INTRODUCTION

Ramada Investimentos is the parent company of a group of companies that together operate within two distinct business segments: i) Industry segment, which includes the activity of special steels and wire drawing, as well as the activity related to the management of financial investments in which the Group is a minority shareholder; and ii) Real Estate segment, aimed at the management of real estate assets.

The special steels activity, which develops, especially at the level of the sub-segment of moulds, with a leading position in the domestic market, is developed by three companies: Ramada Aços, Universal Afir and Planfuro Global.

Socitrel's main business is the manufacture and commercialization of steel wires, capable of being used in a wide variety of activities, including industry, agriculture and construction.

In the financial investments management activity, among other portfolio investments held by the Group, it should be highlighted the participations held in CEV, S.A. and Fisio Share - Gestão de Clínicas, S.A..

The Real Estate Segment includes the real estate asset management activity (composed by the forest assets and the Real Estate of the Group) and is developed by F. Ramada ll - Imobiliária, S.A..

RAMADA GROUP

INDÚSTRIA

HIGHLIGHTS - COVID-19

The first quarter of 2020 was marked by the emergence of a global epidemic called Covid-19, and on 11 March 2020 the World Health Organization declared it a pandemic. In Portugal, a state of emergency was declared, which was in force from the 19th of March to the 2nd of May 2020.

Ramada Group has been assessing and monitoring the pandemic's developments, in terms of the risk factors that in its understanding are relevant, and which may affect the business areas, whether in operational, investment or financial terms. From all the actions implemented within the scope of the monitoring and evaluation of pandemic developments, we highlight the following:

• • Ramada Group, implemented a set of measures for the prevention, control and surveillance of this infection. As a result of the various measures implemented by the Ramada Group, on March 31, 2020, a negative impact on the income statement is estimated in the amount of approximately 100 thousand Euro (including donations, protective equipment, among others).

• • Ramada Group proceeded cautiously with an internal review and evaluation process on the investments it had planned for the 2020 financial year, reassessing the cost-benefit of these portfolio projects, as well as their feasibility, taking into account the current reality. From this review it was decided to reschedule to the second semester the investments that were planned for the months of March and April 2020. The Ramada Group expects to comply with the investments initially stipulated for 2020 until the end of the fiscal year.

• • During the first quarter, and following the declaration of Calamity in the Municipality of Ovar, its subsidiary Ramada Aços, S.A., a production unit located in Ovar responsible for around 40% of the Group's turnover, had its registered office closed from March 18, 2020 to April 6, 2020. The Ramada Group has made every effort to reinforce the inventories and resources of its branches across the country, in order to respond to its Customers requests. Regarding the subsidiary Socitrel - Sociedade Industrial de Trefilaria, S.A., part of the Employees of the factory have been in simplified lay-off since April 14.

• • With regard to liquidity risk management, the Group maintained a liquidity reserve in the form of credit lines with its relationship banks, in order to ensure the ability to meet its commitments, without having to refinance in unfavorable conditions. As of March 31, 2020, the amount of consolidated loans1 maturing in the next 12 months is approximately 19 million Euro. On the same date, the Group has consolidated credit lines available (namely bank overdrafts, pledged current accounts and not used commercial paper programs) in the amount of approximately 40 million Euro. As a result of the performance of previous years, and the capacity to manage credit and liquidity risk, the Group presents a robust financial position statement, presenting Cash and cash equivalents amounting to 38.5 million Euro, representing approximately 80% of its current liabilities.

• • Ensuring the permanent well-being of all Employees, their families and community, has always been and will continue to be a priority of the Ramada Group. To deal with the pandemic, Ramada Group put in place a set of additional preventive measures to protect the health and safety of its Employees, based on the recommendations of the Portuguese Health Authority. The human resources department, based on the recommendations of the Portuguese Health Authority, proceeded with the elaboration of the Group's Covid-19 Contingency Plan. This plan has been continuously adjusted considering the evolution of the pandemic, being essential for the purposes of containing the impacts of the pandemic between our employees and the local community. Ramada Group hereby informs that, up to this date, it is unaware of any of its employees testing positive for COVID-19. Nevertheless, the Group is prepared for this possibility.

1 Consolidated loans: Bank loans + Other loans + Lease liabilities.

CONSOLIDATED INCOME STATEMENT

The consolidated financial information of Ramada Investimentos was prepared in accordance with the recognition and measurement principles of the International Financial Reporting Standards, as adopted by the European Union (IFRS - EU).

The key information and indicators of Ramada Group's consolidated activity can be presented as follows:

1Q 2020	1Q 2019	Var. %
Sales and services rendered	26,362	30,410	-13.3%
Other income	126	136	-7.4%
Total revenues	26,488	30,546	-13.3%
Cost of sales and production variation	(16,601)	(19,094)	-13.1%
External supplies and services	(3,509)	(3,840)	-8.6%
Payroll expenses	(3,275)	(3,583)	-8.6%
Other operating costs (a)	(298)	(138)	115.9%
Total costs	(23,683)	(26,655)	-11.1%
EBITDA (b)	2,805	3,891	-27.9%
EBITDA margin (c)	10.6%	12.7%	-2.1 pp
Amortization and depreciation	(839)	(1,101)	-23.8%
EBIT (d)	1,966	2,790	-29.6%
EBIT margin (e)	7.4%	9.1%	-1.7 pp
Results related to investments	46	0	-
Financial expenses	(297)	(381)	-22.1%
Financial income	10	38	-74.5%
Profit before income tax	1,724	2,447	-29.5%
Income tax	(390)	(538)	-27.5%
Consolidated net profit	1,334	1,909	-30.1%
Net profit attributable to shareholders of the parent company	1,334	1,909	-30.1%
Amounts in thousands of Euro
(a) Other operating costs = Other costs + Provisions and impairment losses

• (b) EBITDA= Profit before income tax + Financial expenses - Financial income + Amortization and depreciation

• (c) EBITDA margin = EBITDA / Total revenues

• (d) EBIT = EBITDA + Amortization and depreciation

• (e) EBIT margin = EBIT / Total revenues

Total revenues of Ramada Group during the first quarter of 2020 amounted to 26,488 thousand Euro, representing a 13.3% decrease over the total revenues recorded in the same period of 2019.

Total costs amounted to 23,683 thousand Euro, recording a 11.1% decrease over the same period the previous year.

EBITDA amounted to 2,805 thousand Euro, representing a decrease of 27.9% compared to the first quarter of 2019. EBITDA margin achieved 10.6%, a decrease of 2.1 percentage points compared to the same period of the previous year.

EBIT, in the amount of 1,966 thousand Euro, recorded a decrease of 29.6% when compared to 2,790 thousand Euro in 2019.

The financial results (financial expenses - financial income), in the amount of 287 thousand Euro, recorded a 16.3% decrease over the first quarter of 2019.

During the first quarter of 2020, consolidated net profit amounted to 1,334 thousand Euro, decreasing 30.1% compared to the first quarter of the previous year.

INDUSTRY

1Q 2020	1Q 2019	Var. %
Total revenues (a)	24,675	28,768	-14.2%
Total costs (b)	23,296	26,241	-11.2%
EBITDA (c)	1,379	2,527	-45.4%
EBITDA margin (d)	5.6%	8.8%	-3.2 pp
EBIT (e)	592	1,498	-60.5%
EBIT margin (f)	2.4%	5.2%	-2.8 pp
Financial results (g)	(146)	(132)	10.3%
Results related to investments	46	0	-
Profit before income tax	492	1,366	-64.0%
Income tax	119	300	-60.4%
Net profit	373	1,065	-65.0%
Amounts in thousands of Euro
(a) Total revenues = Sales and services rendered + Other income

(b) Total costs = Cost of sales and production variation + External supplies and services + Payroll expenses + Other costs + Provisions and impairment losses

• (c) EBITDA = Profit before income tax + Financial expenses - Financial income + Amortization and depreciation

• (d) EBITDA margin = EBITDA / Total revenues

• (e) EBIT = EBITDA + Amortization and depreciation

• (f) EBIT margin = EBIT / Total revenues

• (g) Financial results = Financial expenses - Financial income

In the first quarter of 2020, total revenues from the Industry segment amounted to 24,675 thousand Euro, registering a decrease of 14.2% compared to the same period in 2019. The steel activity is mainly developed in the national market, which, in the first quarter of 2020, represented 93% of the revenues.

EBITDA in the Industry segment amounted to 1,379 thousand Euro, representing a negative variation of 45.4% compared to the 2,527 thousand de Euro recorded in the first quarter of 2019. The EBITDA margin reached 5.6%, which compares to 8.8% recorded in the same period of the previous year.

EBIT, in the amount of 592 thousand Euro, recorded a decrease of 60.5% compared to 1,498 thousand Euro in 2019.