Italian Sea S p A : Half-Yearly Report as at 30 June 2021

THE ITALIAN SEA GROUP S.p.A.

Tax Code 00096320452

THE ITALIAN SEA GROUP S.p.A.

Tax Code 00096320452

Summary
Letter from the Founder and CEO to the Shareholders.....................................................................................................................................................	1
INTERIM REPORT ON OPERATIONS..........................................................................................................................................................................................	3
INTRODUCTION................................................................................................................................................................................................................................	3
SUMMARY DATA AND GENERAL INFORMATION...................................................................................................................................................................	4
CORPORATE AND CONTROL BODIES....................................................................................................................................................................	5
INFORMATION ON THE COMPANY.........................................................................................................................................................................	6
BRIEF HISTORY OF THE ITALIAN SEA GROUP ....................................................................................................................................................	7
BUSINESS DEVELOPMENT ......................................................................................................................................................................................	8
NET FINANCIAL POSITION....................................................................................................................................................................................	18
MAIN ALTERNATIVE PERFORMANCE INDICATORS (API).................................................................................................................................	19
SIGNIFICANT EVENTS IN THE FIRST HALF OF 2021 .......................................................................................................................................	22
EVENTS AFTER YEAR END.....................................................................................................................................................................................	23
BUSINESS OUTLOOK.............................................................................................................................................................................................	25
RELATED PARTY TRANSACTIONS ........................................................................................................................................................................	25
MAIN RISKS AND UNCERTAINTIES.....................................................................................................................................................................	26
INTERIM CONDENSED FINANCIAL STATEMENTS AS AT 30 JUNE 2021....................................................................................................................	27
STATEMENT OF FINANCIAL POSITION ...............................................................................................................................................................	27
INCOME STATEMENT .............................................................................................................................................................................................	28
COMPREHENSIVE INCOME STATEMENT.............................................................................................................................................................	28
CASH FLOW STATEMENT ......................................................................................................................................................................................	29
STATEMENT OF CHANGES IN SHAREHOLDERS 'EQUITY .................................................................................................................................	30
EXPLANATORY NOTES..................................................................................................................................................................................................................	31
CONTENT AND FORM OF THE FINANCIAL STATEMENTS.................................................................................................................................	31
COMMENTS ON THE MAIN ASSET ITEMS...........................................................................................................................................................	50
COMMENTS ON THE MAIN LIABILITY ITEMS.....................................................................................................................................................	63
COMMENTS ON THE MAIN ITEMS OF THE INCOME STATEMENT ...................................................................................................................	71
SHARE-BASEDINCENTIVE PLANS.......................................................................................................................................................................	78
RELATED PARTY TRANSACTIONS ........................................................................................................................................................................	78
SURETIES ................................................................................................................................................................................................................	80
SIGNIFICANT NON-RECURRINGEVENTS AND TRANSACTIONS.....................................................................................................................	80
TRANSACTIONS ARISING FROM ATYPICAL AND/OR UNUSUAL OPERATIONS.............................................................................................	80
SIGNIFICANT EVENTS OCCURRING AFTER THE END OF THE PERIOD .........................................................................................................	81
AUTHORISATION TO PUBLISH.............................................................................................................................................................................	81
CERTIFICATION OF THE CONDENSED HALF-YEARLY FINANCIAL STATEMENTS PURSUANT TO ARTICLE 81-TER OF CONSOB
REGULATION NO. 11971 OF 14 MAY 1999, AS AMENDED.............................................................................................................................................	82

THE ITALIAN SEA GROUP S.p.A.

Half-yearly Financial Report as at 30 June 2021

Letter from the Founder and CEO to the Shareholders

Dear Shareholders:

In these first six months of 2021, The Italian Sea Group doubled its revenues compared to the same period in 2020, reaching approximately Euro 81 million, with significant growth in all divisions and in the different geographical areas. EBITDA amounted to Euro 10.3 million, a 12.7% impact on revenue, representing an increase of Euro 5.4 million compared to the first six months of 2020. Net profit, which reached Euro 4.6 million, quadrupled compared to the first half of 2020. Furthermore, thanks to the capital increase carried out at the time of listing, we also achieved a significant capital strengthening, as shown by the positive net financial position of Euro 22.3 million as at 30

June 2021.

These results reflected the excellent positioning in the market, as demonstrated by the focus on yachts up to 100 metres in length, while at the same time leveraging collaboration agreements with prestigious luxury brands such as Automobili Lamborghini and Giorgio Armani.

Giovanni Costantino

The continuing crisis triggered by the spread of Covid-19 has not affected the work on our construction site or our IPO project. Since 8 June 2021, the shares of The Italian Sea Group have been listed on Mercato Telematico Azionario managed by Borsa Italiana S.p.A., an achievement which represents a milestone in our growth path and which is a testament to the committed effort made by the entire management team in paving the way to the listing and in establishing a fruitful dialogue with investors. From our perspective, the stock market is synonymous with transparency and opportunities for the future. Our status as a listed company will give us greater visibility in international markets, which are strategic for our development, and a greater ability to attract qualified resources. The total funds raised through the issuance of new shares at the time of the IPO brought approximately Euro 45 million into the Company. This income, together with the cash flow generated from operations, allows us to seize the best investment opportunities to accelerate our development path.

1

THE ITALIAN SEA GROUP S.p.A.

Half-yearly Financial Report as at 30 June 2021

Regarding in particular organic growth, during the first six months of 2021, through the TISG

4.0 project, we confirmed all the investments we had planned as we were able to count on considerable financial soundness and leveraging our vision, strategic clarity and execution ability that in little more than a decade have enabled us to become one of the main international players in the sector.

All the orders currently in construction respect a very high quality standard, and they are all proceeding according to the scheduled timeline and planned delivery (with some orders even ahead of schedule). We are also proud to announce that we have delivered the first Tecnomar for Lamborghini 63, a cutting-edgemotor-yacht, born from the union of the excellence in the nautical world and the one in the super sport cars, which is being extremely successful among our customers all over the world.

In terms of sustainability, we have embarked on a path towards the use of renewable energy, with the implementation of solar panels capable of producing almost all the electricity required by the site. We have been working on hybrid propulsion for years: in 2017 we were the first to launch a 55-mt yacht, which at the time was the largest hybrid ship in the world.

Driven by a long-term approach, we strongly believe in training young people: in fact, in the first half of 2021, we officially opened our Academy, in cooperation with the Universities of Genoa and La Spezia, dedicated to the promotion of paths of excellence for our company employees and for the undergraduates of the Nautical Engineering and Mechanical Engineering faculties with a Mechatronic specialization, and the Yacht Design master's degree course.

We are therefore closing the first six months of 2021 with outstanding economic and financial results, which provide eloquent confirmation of what we had indicated during the listing process, especially with regard to our ability to grow continuously and sustainably even during the most challenging periods.

I would like to thank all the people working for The Italian Sea Group for their contributions to the execution of the various projects and the achievement of these financial results.

I would also like to thank all the investors who have placed their trust in our Company at the time of listing and those who subsequently have contributed to our share capital. I can assure them of our on-going commitment to faithfully implement the strategic plan presented during the IPO, trusting that the good results that TISG will be able to achieve will continue to translate into attractive returns for the shareholders.

Giovanni Costantino

Chief Executive Officer

2

THE ITALIAN SEA GROUP S.p.A.

Half-yearly Financial Report as at 30 June 2021

INTERIM REPORT ON OPERATIONS

INTRODUCTION

This Half-Yearly Financial Report as at 30 June 2021 has been prepared in accordance with Article 154-ter of Legislative Decree 58/1998 and includes the Interim Report on Operations, the Interim condensed Financial Statements as at 30 June 2021 and the Certification required by Article 154-bis of Legislative Decree 58/98.

The Interim condensed Financial Statements are prepared in accordance with International Accounting Standards (IAS/IFRS) applicable pursuant to EC Regulation No. 1606/2002 of the European Parliament and Council of 19 July 2002 and in particular IAS 34 - Interim Financial Reporting.

The structure and content of the reclassified financial statements contained in the Interim Report on Operations and the mandatory tables included in this Report are in line with those prepared in the Annual Report.

The notes to the financial statements have been prepared in accordance with IAS 34 - Interim Financial Reporting, also taking into account the provisions of Consob Communication No. 6064293 of 28 July 2006. The information contained in this Report is therefore not comparable to that of complete financial statements prepared in accordance with IAS 1.

The figures presented here may in some cases contain rounding errors due to the representation in thousands; it should be noted that changes and percentages are calculated on figures expressed in thousands and not on rounded figures shown in millions.

3