Viohalco S A : Financial results 2023

REGULATED INFORMATION INSIDE INFORMATION

Brussels, March 7, 2024 - Viohalco S.A. (Euronext Brussels: VIO, Athens Stock Exchange: VIO), hereafter "Viohalco" or "the Company", today announces its consolidated financial results for the year ended 31 December 2023.

Resilient performance and lower leverage amidst challenging markets

Responding to demand fluctuations through a flexible business model and diversified portfolio

Financial highlights

• • Consolidated operating profitability (a-EBITDA) amounted to EUR 537 million compared to EUR 649 million in 2022. The slowdown of global economic growth, combined with inflationary pressures were partially counterbalanced by the continuing green transition trend and related demand;

• • Consolidated revenue amounted to EUR 6.30 billion vs. EUR 6.99 billion in 2022 due to lower volumes and decline in metal prices;

• • Consolidated profit before income tax amounted to EUR 91 million compared to EUR 375 million in FY 2022, due to the drop of the metal prices which turned metal results negative and increased finance costs;

• • Net debt decreased significantly by EUR 184 million to EUR 1,873 million, as a result of effective working capital management, also supported by the decline of metal prices;

• • Proposed gross* dividend of EUR 0.12 per share.

Operational highlights

• • Significant growth in revenue and profitability for the cables and steel pipes segments, driven by the solid demand, the successful delivery of existing projects and the award of new ones;

• • Increase in the operating profitability of the copper segment, driven by an improved product mix and the growing sales and profitability of Sofia Med;

• • The aluminium segment was affected by the global downturn in demand, especially in relation to products in the lithographic sector;

• • The steel segment was affected by a contraction in the European construction sector demand, increased energy costs and the rise of imports from low-cost countries, partially offset by growth in the Greek construction market;

• • Continued effort to adapt product portfolio, maximise capacity utilisation and increase operational efficiency across industrial segments;

• • Positive performance of the real estate division achieved through redevelopment of existing assets with a continued focus on sustainability and active management of existing properties.

* The final net dividend can be differentiated, as the Belgian tax authorities impose a withholding tax and tax compliance formalities, depending on the shareholder's tax residence.

Commenting on the results, CEO Ippokratis Ioannis Stassinopoulos stated:

"In 2023, Viohalco companies demonstrated their ability to swiftly navigate changing market conditions. In an environment of increased interest costs and inflationary pressures, Viohalco managed to post a resilient performance and decrease its debt levels. The cables and steel pipes segments performed very well, since they were able to successfully deliver existing projects, while securing substantial new ones. The copper segment posted a robust operating profitability, outperforming the market. While weak global conditions affected aluminium, the segment maintained its competitive advantage and continued to expand its well-diversified portfolio into faster growing and higher value-added product segments. The steel segment results were affected by subdued demand from the EU construction industry and competition from low-cost imports. Finally, real estate division recorded a positive performance, driven by the increasing demand for high-quality and sustainable buildings in Greece. For the coming years, we are confident that the current downturn in demand will reverse as positive sustainability megatrends take over".

Overview

Viohalco's performance throughout 2023 remained resilient, though impacted by weak demand in the aluminium and steel segments, as a consequence of a difficult international market for many products and especially those related to the construction market. This was partially offset by a remarkable performance of the cables and steel pipes segment, as well as of the real estate division and the high operating profitability of the copper segment. The above were supported by the companies' diversified product portfolio and ongoing efforts to streamline operations.

The significantly positive performance of the cables and steel pipes segments was a result of increased demand for energy projects and improved competitive positioning in these segments. The awarding of new projects to support the energy transition and meet increasing demand for natural gas, further increased the backlog. The copper segment maintained a high operating profitability driven by the performance of Sofia Med subsidiary. The aluminium segment experienced slower demand across a broad range of aluminium products, amid macroeconomic challenges. However, the segment exhibited resilience in maintaining operating profitability, with concerted efforts directed towards debt reduction. The decrease in revenue was mainly attributable to the performance of the Viohalco subsidiary Bridgnorth Aluminium in the UK, as a result of a contraction in the lithographic business. The performance of the steel segment was overall subdued, affected by the strong downtrend in European steel demand throughout the year, with the exception of the strong demand in Greece and the heavy plates activity, which were respectively positively impacted by a growing construction market and an increasing preference for low carbon footprint solutions. Finally, the real estate division also recorded a positive performance, with Noval Property's active management of existing properties and ability to respond to the demand for high-quality and sustainable buildings proving once again successful. Noval Property remains on track for its Initial Public Offering (IPO) in the Athens Stock Exchange in 2024.

Viohalco's financial reporting is split into two divisions, based on their distinct business characteristics and performance metrics:

The industrial division, including aluminium, copper, cables, steel pipes, steel, R&D&I and technology segments, and the real estate division comprising of Viohalco's property investments and real estate related entities.

The industrial division

Key highlights

€ 6.3 bil.	€ 519 mil.	€ 80 mil.	€ 281 mil.	4.2x
Revenue (2022: € 6.96 bil.)	a-EBITDA (2022:€ 636 mil.)	Profit before tax (2022: € 377 mil.)	2023 CAPEX (2022: € 317 mil.)	Net Debt / EBITDA (2022: 3.0x)

Industrial division - Key financials

2023	2022
Amounts in EUR thousands
*Represented
Revenue	6,263,772	6,955,326
Gross profit*	559,499	770,291
EBITDA	411,381	633,661
a-EBITDA	519,264	635,983
EBIT	272,127	493,826
a-EBIT	380,010	496,148
Net finance cost	-181,267	-115,988
Profit before tax	80,163	376,752
Property, plant and equipment (PP&E)	2,222,756	2,230,385
Net debt	1,720,072	1,922,988
Capex	280,583	316,866
*Please refer to Appendix A.

Τhe revenue of the industrial division amounted to EUR 6,264 million. The operating profitability (a-EBITDA) of the industrial division amounted to EUR 519 million.

Viohalco's industrial division is composed of the following segments: aluminium, copper, cables, steel pipes and steel.

• • The aluminium segment demonstrated resilience amidst a challenging market with fluctuating demand and macroeconomic dynamics. This result was impacted by the downturn in the lithographic sector for Bridgnorth Aluminium and softened demand across all products. As we move towards a low-carbon future and circular economy becomes increasingly important, demand for sustainable aluminium solutions is expected to remain strong in the long run. Also, within 2023, the segment achieved operational excellence by leveraging its latest investments to help optimise capacity allocation and reshape its product mix distribution.

• • The copper segment continued to face lower demand as a consequence of interest rate rises and their effect on global economic growth throughout the year. This mainly affected the quantities of copper tubes, copper alloy extruded products and enamelled wire, while growing sales were achieved in copper and copper alloy rolled products and copper extruded products, respectively. The segment's operating profitability was high, driven by the subsidiary Sofia Med , but the profit before taxes was affected by the decline in metal prices. The whole segment continued to align strongly with products and projects related to the global energy transition requiring many different forms of copper and copper alloys, helping to ensure the future growth of the segment.

• • In the cables segment, the efficient execution of high-profile offshore and onshore energy projects combined with high-capacity utilisation across all production lines supported growth and fostered performance. At the same time, low-voltage and medium-voltage power cables saw strong demand during 2023 and better profitability margins compared to the previous year. This margin growth, combined with an improved product mix alongside timely and efficient project execution, led to a significant improvement in adjusted EBITDA (+39% y-o-y). Along came several new awards, both for interconnections and OWFs, that further advanced the segment's backlog to a new record of EUR 2.5 billion.

• • For the steel pipes segment, 2023 was a strong and landmark year. Revenue reached EUR 580 million and adjusted operating profit (a-EBITDA) more than doubled compared to the year prior. The segment also improved its competitive position as a Tier 1 pipe manufacturer and leader in technologies that enable the energy transition, such as hydrogen transportation through high-pressure steel pipes and pipelines for Carbon Capture & Storage (CCS) projects, benefiting from a wide array of strategic initiatives undertaken during previous years. Demand for natural gas and the necessity to continue towards the new energy paradigm, while guaranteeing energy security, led to a series of high-margin new contracts and a strong order backlog of approximately EUR 650 million by the end of the year.

• • In 2023, the steel segment's performance was subdued, mainly as a consequence of the sharp downward trend in the European steel market throughout the year. The segment maintained its leading market position in the growing Greek construction market. However, the deteriorating European construction sector, increased energy costs and elevated

imports of steel products from low-cost countries, negatively affected the overall performance. As a result, sales of reinforcing steel, wire rods and merchant bars reduced significantly. This was partially offset by increased demand for hot rolled plates from the Baltic and North European countries, where the low carbon footprint of Stomana Industry's quarto plates provided a competitive advantage. Sales of special steels (SBQ) saw a reduction in volume, attributable to the European mechanical engineering sector slow-down. Price spreads also significantly declined across all the product ranges. Notwithstanding the impact of macro challenges and high energy prices, the steel segment's scrap supply proved resilient and didn't impact product delivery and service levels.

The real estate division

Key highlights

€ 38 mil.	€18 mil.	471 K sqm	98.1 %	€ 27 mil.
Revenue	a-EBITDA	GBA * (2022: 465 k	Occupancy	CAPEX
(2022: € 30 mil.)	(2022:€ 13 mil.)	sqm.)	rate ** (2022:	(2022: € 40 mil.)
96%)

* Referring to the portfolio of real estate assets of Noval Property. ** Referring to the income-producing portfolio of Noval Property.

In the real estate division, Noval Property reported significant growth in relation to both the value of its investment properties and the revenue generated by the company's income-producing assets. This was achieved despite a challenging macro environment characterised by increases in energy and product prices, as well as high interest rates and prevailing geopolitical turbulence in the region. This performance stems from Noval Property's strengthened portfolio as a result of the continuous active management of existing properties, the increasing demand for high-quality and sustainable buildings in Greece and the implementation of Noval Property's captive development programme, comprising of the commencement and advancement of preliminary works and construction on several properties. In October 2023, Noval Property entered into a EUR 10.5 million convertible bond loan with EBRD, in view of the company's Initial Public Offering (IPO) listing on the Athens Stock Exchange, expected to take place in 2024.

It should be noted that Viohalco applies the historical cost in investment property, while certain real estate division subsidiaries (such as Noval Property) follow the fair value model. Noval Property 2023 earnings before taxes, based on the fair value model, amounted to profits of EUR 67.5 million (Historical cost earnings before tax amounted to EUR 13 million), while GAV as of 31.12.2023 (including long-term leases) amounted to EUR 582.6 million and NAV stood at EUR 427.4 million.

Finally, sustainability remains a key priority for all Viohalco subsidiaries, as the companies successfully progressed various initiatives in line with the overarching sustainability strategy. Climate change, circular economy and occupational health and safety remained at the forefront of the efforts, as significant human and financial resources were invested to continuingly improving in those areas. Sustainability is a key requirement for Viohalco companies' customers, especially in the cables and aluminium segment, where inquiries about the sustainability attributes of the products, sustainability certifications and long-term commitment to decarbonisation efforts from Viohalco subsidiaries are requested on a regular basis. In addition to this, during 2023, Viohalco completed the evaluation of the most important climate-related risks and opportunities of the subsidiaries and published its first inaugural TCFD Report.

Outlook

Amidst ongoing macroeconomic uncertainty driving demand fluctuations, Viohalco's companies' diversified portfolio, sustained competitive advantages, streamlined processes and optimised capacity utilisation, coupled with long-term projections for sustainable products' demand, bode well for the future.

While the aluminium and steel segments faced revenue setbacks in FY 2023 due to demand fluctuations, the rising demand for innovative and sustainable packaging solutions, energy-efficient infrastructure and shifts in the automotive industry, combined

with ongoing efforts to enhance operational efficiency, will continue to bolster Viohalco companies' competitiveness in these areas.

At the same time, the cables, copper and steel pipes segments are expected to keep gaining momentum, fueled by the inevitable shift toward electrification, the wide deployment of investments in RES and the need for grid expansions, as well as increasing requirements for hydrogen and Carbon Capture & Storage (CCS).

On the real estate front, Noval Property's diversified portfolio and planned developments, together with its successful active management business model provides further strength to its overall positioning.

For further information, please contact:

Sofia Zairi, Chief Investor Relations Officer Tel: [phone]

Email:[e-mail] _______

A conference call to discuss these results will be held on Friday, March 8th 2024 at 13:00 GMT / 15:00 EET.

To participate in the teleconference, please dial in approximately 5 minutes before the start of the call and use one of the following telephone numbers:

• • Greek participants: [phone] or [phone]

• • UK participants: [phone]

• • UK & International: [phone]

• • USA participants: [phone]

Financial overview

Consolidated financial key figures

Amounts in EUR thousands	2023	2022 *Represented
Revenue	6,301,957	6,985,735
Gross profit*	578,867	781,736
EBITDA	436,033	646,363
a-EBITDA	537,447	648,897
EBIT	290,404	497,250
a-EBIT	391,818	499,783
Net finance cost	-187,796	-121,320
Profit before tax	91,324	374,564
Profit for the period	66,516	302,389
Profit attributable to owners	48,233	266,133
*Please refer to Appendix A.

In 2023, Viohalco's consolidated revenue decreased to EUR 6.30 billion (2022: EUR 6.99 billion). This was mainly due to the decrease in metal prices and the reduced volumes sold compared to 2022.

Consolidated a-EBITDA decreased at EUR 537 million (2022: EUR 649 million), as a result of the decrease in volumes.

Net finance cost increased to EUR 188 million (2022: EUR 121 million), as a consequence of higher interest rates.

Consolidated profit before income tax for the period amounted to EUR 91 million, compared to EUR 375 million in 2022.

Consolidated net profit after income tax and minority interests amounted to EUR 48 million (2022: EUR 266 million); with earnings per share amounted at EUR 0.19 (2022: EUR 1.03).

Amounts in EUR thousands	31.12.2023	31.12.2022
Fixed and intangible assets	2,805,429	2,625,715
Other non-current assets	116,789	100,709
Non-current assets	2,922,219	2,726,424
Inventory	1,610,467	1,914,098
Trade and other receivables (incl. contract assets)	955,613	874,921
Cash and cash equivalents	395,015	412,644
Other current assets	36,397	102,109
Current assets	2,997,491	3,303,772
Total assets	5,919,710	6,030,196
Equity	1,959,371	1,955,895
Loans and borrowings	1,442,138	1,471,299
Other non-current liabilities	217,304	219,685
Non-current liabilities	1,659,442	1,690,985
Loans and borrowings	779,297	958,166
Trade and other payables (incl. contract liabilities)	1,463,473	1,304,828
Other current liabilities	58,127	120,322
Current liabilities	2,300,897	2,383,316
Total equity and liabilities	5,919,710	6,030,196

Capital expenditure for the period amounted to EUR 308 million (2022: EUR 357 million), is mainly due to the following investments:

• ▪ New production equipment in the context of ElvalHalcor's aluminum segment investment programme, aiming at increasing production capacity increase and improving the product portfolio mix;

• ▪ Capacity increase of copper segment's subsidiary, Sofia Med;

• ▪ Capacity increase of the offshore cables plant in Corinth and selective investments in onshore cables plants in the area of Thiva, Greece;

• ▪ Capacity improvements at the steel pipes segment in the Thisvi plant;

• ▪ Machinery improvements and IT investments at the steel segment subsidiaries;

• ▪ Development of the existing portfolio and new property development in the real estate division.

The decrease in working capital by 26% was mainly driven by the drop in metal prices, coupled with the organic reduction in the cash-to-cash cycle.

Net debt decreased to EUR 1,873 million (31 December 2022: EUR 2,057 million), due to Viohalco's positive free cash flow during the year.

Segmental performance

Amounts in EUR million	Revenue	EBITDA	a-EBITDA	EBIT	EBT
Segments	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022
1,887	2,313	95	271	153	223	35	211	-7	179
1,721	1,811	91	81	107	75	72	63	36	40
991	895	140	107	152	110	120	89	73	64
580	457	64	25	66	25	54	16	25	8
1,014	1,392	22	144	42	196	-5	113	-41	88
69	88	-	6	-1	7	-4	1	-6	-1
6,264	6,955	411	634	519	636	272	494	80	377
38	30	25	13	18	13	18	3	11	-2
6,302	6,986	436	646	537	649	290	497	91	375

IndustrialDivision

Aluminium

Copper

Cables

Steel pipes

Steel

Other activities

Total

Real Estate

Division* Consolidated

* Apart from Noval Property, the real estate division of Viohalco includes other entities that relate to real estate operations. It should be noted that Viohalco applies the historical cost model in investment property, while certain real estate division subsidiaries (such as Noval Property) follow the fair value model. Noval

Property 2023 earnings before taxes, based on fair value model, amounted to profits of EUR 67.5 million.

Performance review by division

The industrial division

Aluminium

In 2023, the revenue of the aluminium segment amounted to EUR 1,887 million (2022: 2,313), with a loss before tax for the period of EUR 7 million (2022: profit before tax at EUR 179 million), mostly attributable to a negative performance of the aluminium subsidiary Bridgnorth Aluminium in the UK and declining metal prices.

Throughout the year, geopolitical issues, high inflation and elevated interest rates, affected global demand across a broad range of aluminium products offered by ElvalHalcor's aluminium segment, with total sales volume decreasing by 2% (excluding Etem Group, sales tonnage remained flat compared to 2022). Moreover, the lower aluminium LME prices during 2023 against the historical high of 2022, resulted to significant accounting metal losses, against metal profits of EUR 50 million in 2022. These metal losses, along with higher interest expenses affected profitability.

The numerous interest rate increases during the year saw the prioritisation of debt reduction. Through lower capital expenditure, coming after the completion of the previous investment plan and better management of working capital, the segment was able to successfully reduce net debt to EUR 613 vs. EUR 746 million as at December 31st, 2022.

Increasing consumer preference toward high recycled content in packaging solutions, energy-efficient infrastructure and the adoption of lightweight and electric vehicles will continue to drive the demand for aluminium solutions. ElvalHalcor's aluminium segment is well-diversified across different geographic regions and product categories and it aims to expand further into faster-growing product segments and value-added applications. It is also committed to establishing strong collaborations for future growth and competitive strength, while contributing to a sustainable aluminium value-chain.

During 2023, ElvalHalcor published its first inaugural Task Force on Climate-related Financial Disclosures (TCFD) Report, in which the aluminium segment companies identified and assessed their most important climate-related risks and opportunities.

2023 was a challenging year for Bridgnorth Aluminium. The company undertook a comprehensive restructuring program and experienced ongoing subdued demand through 2023 for all products. Bridgnorth Aluminium continues to further optimise and improve Health & Safety, Technology, Quality and Operational Performance across the entire business to ensure the company is ready to match current and future customer demand and to also reach potential new customers in the global EV market and others.

In 2023, Etem Gestamp has been balancing the expansion of existing facilities and installation of machinery to cope with new automotive projects and the adverse market conditions impacting the industrial side of the business. Throughout the period, the output of the industrial aluminium profiles was impacted by consistent declines in sales prices and profit margins, combined with high market competition, which also supressed targeted volumes. On the other hand, automotive sales outperformed forecasts, mostly benefited from a stable and increasing demand trend which in turn supported both cash flow and profitability, while enabling the transformation of the businesses' client portfolio in favour of automotive. While the electric vehicle industry has seen some delays in the launching of new models and uncertainty, the company's product portfolio, which is well balanced between electric and combustion engine cars, along with its universal machinery configuration, remains well positioned to navigate the automotive market developments in 2024.

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