Waberer International : Consolidated Financial Statements & Business Report

2022

CONSOLIDATED

FINANCIALSTATEMENTS & BUSINESS REPORT

Table of contents

Message from the CEO ...........................................................................................................................	3
Management Report ................................................................................................................................	4
Waberer's Group .................................................................................................................................	4
Key performance indicators .............................................................................................................	4
Key financial indicators ....................................................................................................................	4
Company structure: .........................................................................................................................	5
Strategy ...............................................................................................................................................	5
Infrastructure modernisation ............................................................................................................	6
Increase service complexity ............................................................................................................	6
Diversification ..................................................................................................................................	7
Business Environment and Results.....................................................................................................	8
Economic Environment....................................................................................................................	8
Revenue ..........................................................................................................................................	9
Gross profit, EBITDA and EBIT .......................................................................................................	9
Net income.......................................................................................................................................	9
Cash flow .........................................................................................................................................	9
Net Debt.........................................................................................................................................	10
Investor relations/Ownership structure ..............................................................................................	11
Shareholder structure ....................................................................................................................	11
Analysts .........................................................................................................................................	11
Capital market performance ..........................................................................................................	11
Investor relations ...........................................................................................................................	12
Digital transformation.........................................................................................................................	12
Effective communication and real time information exchange with drivers ...................................	12
Control dashboard for optimal resource and truck route planning ................................................	13
Increased fleet efficiency via smart forklifts ...................................................................................	13
Analysis based decision making along the entire value chain ......................................................	13
Innovation ..........................................................................................................................................	13
Testing alternative fuel vehicles ....................................................................................................	14
Real time trailer monitoring............................................................................................................	14
Development of workshop and site efficiency monitoring systems ...............................................	14
Implementation of voice picking warehousing operations .............................................................	15
Sustainability......................................................................................................................................	15
Environmental sustainability ..........................................................................................................	15
Compliance....................................................................................................................................	16
ANNUAL REPORT 2021	1

Social responsibility .......................................................................................................................	17
In the forefront of the fight against COVID ....................................................................................	17
An extraordinary Women's Day gift ...............................................................................................	17
Supporting local institutions and communities: helping everyday life ...........................................	17
Green support................................................................................................................................	18
Focus on the generation of the future ...........................................................................................	18
Health protection............................................................................................................................	18
Logistics support............................................................................................................................	18
Presence and value creation .........................................................................................................	19
Human resources ..............................................................................................................................	20
Corporate Governance and Corporate Bodies ..................................................................................	21
Board of Directors..........................................................................................................................	21
Chief Executive Officer ..................................................................................................................	23
Introduction of the management ....................................................................................................	23
Supervisory Board .........................................................................................................................	24
Audit Committee ............................................................................................................................	25
Nomination and Remuneration Committee ...................................................................................	26
Internal controls and risk management .............................................................................................	26
Internal control system ..................................................................................................................	26
Risk management framework ........................................................................................................	27
Risk factors ....................................................................................................................................	27
Market risk factors .........................................................................................................................	28
Regulatory risk factors ...................................................................................................................	29
Financial risk factors ......................................................................................................................	29
Operational risk factors..................................................................................................................	30
Insurance-specific risk factors .......................................................................................................	30

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Message from the CEO

Despite the unpredictable business environment, the business year of 2021 was a great success for Waberer's Group. The shortage of components, which complicated our customers' business processes and the disruption of global logistics processes in 2021 made the demand for logistics services unpredictable, were all effects that in themselves generated significant risks to be managed. Nevertheless, as a result of our flexibility and successful business model change of Waberer's Group, we closed the most profitable year since business year of 2017, meanwhile Company's indebtedness level was significantly reduced.

In the first half of 2021, Waberer's new ownership structure was finalized as a result of acquisitions by professional and financial investors who expressed their long-term support and joined us with significant development plans.

We also agreed with our financing banks in the first half of the year, and they expressed their support to our Company and also provide a solid basis for both our operation and business development plans by having access to long-term financing facilities.

Turning to the business segments, the most important task for our International Transportation Segment (ITS) was the successful implementation and fine-tuning of the business model change (introduction of the "Tradelane Model"). The evidence for the success of the project is the fact that we managed to achieve a recurring EBIT1 improvement of EUR 22.3 million in one year in our international transportation business, and we were once again able to turn the Group's largest revenue-generating segment to a positive EBIT range. Special thanks to the work of my colleagues and their faith in the project - with their help we were able to carry out perhaps the most successful business turnaround story in Hungary in the recent years.

In our regional contract logistics (RCL) segment, our target was to maintain the high level of profitability achieved in the previous year. The tightness of the domestic labour market and - in contrast to the flexibility resulting from the highly standardized equipment and services of the ITS segment - the difficulties of the reallocation of dedicated resources that characterize certain business lines of the RCL segment have generated challenges to our Company. Nevertheless, in 2021 - with a slight increase in sales revenue - we managed to maintain the level of outstanding profit-generating capacity of the previous year.

Last but not least, our insurance segment also achieved the highest results since our IPO, continuously demonstrating the viability of a business model of operating on a focused market segment. I am proud that Wáberer Hungária Biztosító is part of our Group as the most efficient insurance company in Hungary.

We believe that based on the successful 2021 business year, the implementation of the Company's strategy - presented at the end of last year - will further increase Waberer's role in the European logistics market, expand the complexity of our service portfolio and, last but not least, enables the Company to further develop our profitability level in mid-term.

Finally, I would like to thank my colleagues who work in our trucks, warehouses, and in the offices throughout the year. The logistics sector is particularly sensitive to the current labour market situation, so I am especially proud that our employee-centric thinking at Waberer's and our ability to attract regional labour force ensures that we have the necessary workforce for our operation.

Zsolt Barna

Chief Executive Officer

1 Non-recurring items were not incurred in 2021. In 2020, the one-time cost of business model change in the ITS segment and goodwill impairment were categorized as non-recurring items in the value of EUR 26.6 million.

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Management Report

Waberer's Group

Key performance indicators

International fleet: 2000 vehicles

Domestic fleet: 780 vehicles

Forklifts: 400

Warehouse: 250 000 sq m

Number of employees: 5800

Key financial indicators

[EUR mn]	2 019	2 020	2 021
Revenue	696,2	569,3	590,8
ITS	480,7	334,8	351,0
RCL	147,0	177,1	185,1
Other	68,4	72,2	75,9

EBIT (Reported)	(29,4)	(24,5)	27,2
	-	-	-
ITS	(42,5)	(47,5)	1,5
RCL	4,3	13,8	13,0
Other	8,7	9,2	12,7

EBIT (Recurring)	(11,0)	2,1	27,2
	-	-
ITS	(24,3)	(20,9)	1,5
RCL	4,5	13,8	13,0
Other	8,7	9,2	12,7
	-
Net Income	(41,8)	(41,8)	18,1
Indeptedness
Net debt	191,1	122,7	121,7
Net leverage	3,3	2,2	1,6

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