Wiit S p A : Publication of the half-year financial report at 30 June 2020

PRESS RELEASE

WIIT S.p.A. BoD approves H1 2020 results(1)

Strong sales increase confirmed (+56.1%), driven mainly by organic growth, focus on

higher added-value services, and the consolidation of Matika and Etaeria

Adjusted EBITDA up 40.0% on H1 2019,

further improvement in the acquired companies margins

EBIT Adjusted up 40% on H1 2019

Growing commercial pipeline to support H2 results Significant cash generation in the first half of the year

The WIIT Group in H1 2020 reports:

• Consolidated revenues of Euro 23.5 million (+58.8% compared to H1 2019), including the extraordinary effect of the tax credit for Euro 0.4 million;
• Consolidated EBITDA of Euro 8.5 million, up 74.1% on the same period of 2019. Margin on revenues of 36.2%;
• Consolidated EBIT of Euro 4.2 million, up 123.8% on H1 2019;
• Consolidated net profit of Euro 3.1 million reflects the impact on non-recurring costs from the acquisition of Etaeria Spa (approx. Euro 0.1 million) and the benefit from the tax credit (approx. Euro 0.4 million). In the previous year, the "Patent Box" tax credit for previous years was recognised for Euro 1.0 million;
• Adjusted consolidated revenues of Euro 23.1 million (Euro 14.8 million in H1 2019), +56.1% on the same period of previous year; increase driven by organic growth, focus on higher added- value services, cross-selling, a continually expanding Cloud services market and the acquisition of Matika and Etaeria;
• Consolidated Adjusted EBITDA of Euro 8.2 million (Euro 5.9 million in H1 2019), +40.0% on H1 2019, thanks to the concentration on Cloud services, the degree of optimisation of processes and operating services organisation, cost synergies, and the ongoing improvement in the margin of acquires; margin on revenues of 35.7%;
• Consolidated Adjusted EBIT of Euro 4.3 million (Euro 3.1 million in H1 2019), +40.0% on the same period of the previous year, with a margin on revenues of 18.7%;
• Adjusted net profit of Euro 3.2 million (Euro 3.8 million in H1 2019, this result includes the Patent Box effect for Euro 1.0 million);
• Net Financial Position (excluding the impact from the application of IFRS 16 for approx. Euro 5.6 million): debt of Euro 31.9 million (Euro 20.0 million in 2019), including the value of acquisition and the earn-outs connected to Etaeria S.p.A. and the Aedera for a total of Euro 13 million, and Group dividend payments of Euro 4.1 million. This amount does not include the valuation of the treasury shares in portfolio, quantified at approx. Euro 16.0 million at market value at June 30, 2020;

1For the definitions of EBITDA, Adjusted EBITDA, EBIT, Adjusted EBIT, Net Financial Position/Net Debt, Adjusted net profit, reference should be made to the "Alternative performance indicators" at the end of this Press Release.

• COVID-19update:
• • the Company activated its smart working procedures as of February 25, 2020, and from May 18, 2020, began gradually reopening its offices;
  • given the recurring nature of WIIT's revenues, no significant repercussions on the 2020 operating and financial performance are expected, as confirmed by the results for the first six months of the year. No revisions to the budget or of impairment tests are therefore necessary.

Milan, September 9, 2020 - The Board of Directors of WIIT S.p.A ("WIIT" or the "Company"; ISIN IT0004922826; WIIT.MI), a leading Italian player in the Cloud Computing market for enterprises demanding uninterrupted Hybrid Cloud and Hosted Private Cloud services for critical applications, meeting today approved the consolidated results at June 30, 2020, drawn up as per IFRS.

The Chief Executive Officer Alessandro Cozzi observed: "The results in the first half of the year confirm the Group's strong growth across all financial indicators. The EBITDA of WIIT and its subsidiaries continues to improve, driven by upselling and cross-selling to existing clients, in addition to cost synergies. There has also been strong growth in existing and new customers' interest in the smart working and cyber-security services provided through WIIT's Cloud platform. We are therefore extremely optimistic about our results for the second half of the year, thanks to a commercial pipeline that continues to expand".

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H1 2020 Consolidated Results

The Group headed by WIIT (the "WIIT Group") reports consolidated revenues for H1 2020 of Euro 23.5 million, up 58.8% on Euro 14.7 million for the first half of 2019. This result includes the one-off benefit of Euro 0.4 million from the tax credit.

Adjusted consolidated revenues totalled Euro 23.1 million, up 56.1% on the same period of the previous year. This increase was driven by organic development with upselling on existing customers, the acquisition of new customers and the contribution of Matika and Etaeria, in line with expectations.

Consolidated Adjusted EBITDA in H1 2020 was Euro 8.2 million, up 40.0% on Euro 5.9 million in H1 2019, with a margin of 35.7%.

The WIIT margin in H1 2020 was 47.5%, up from 46% at December 31, 2019. The gradual and substantial improvement in Adelante's margin continues, increasing from 17.7% in 2019 to 22.4% in H1 2020, and of Matika, which increased from 25.6% in 2019 to 27.6% in the first half of 2020. Finally, the margin of Etaeria was 20.9% in the half year. This progression follows the Group's concentration on Cloud services, reduced low added-value product revenue, optimised process and operating services organisation, and cost synergies across all subsidiaries.

The adjustment to EBITDA for H1 2020 concerns the positive effect from the tax credit and for Euro 0.1 million non-recurring costs for acquisitions.

Adjusted EBIT was Euro 4.3 million in H1 2020, growing 40.0% on Euro 3.1 million in H1 2019, with a 18.7% margin on revenue, despite an increase in amortisation, depreciation and write-downs of Euro 1.1 million on H1 2019.

The Adjusted net profit for H1 2020 was Euro 3.2 million, compared to Euro 3.8 million at H1 2019. In the previous period, the "Patent Box" benefit relating to preceding periods was recognised for Euro 1.0 million.

The reported consolidated net profit of Euro 3.1 million reflects the impact on non-recurring costs from the acquisition of Etaeria S.p.A. (approx. Euro 0.1 million) and the benefit from the tax credit (approx. Euro 0.4 million).

The Net Financial Position (debt), considering the IFRS 16 impact of approx. Euro -5.6 million in the period, increased from a debt of Euro 25.5 million at December 31, 2019 to Euro 37.5 million at June 30, 2020. This amount includes, in particular, the value of the acquisition and the earn-outs relating to Etaeria S.p.A. and the Aedera business for a total of Euro 13 million.

Strong cash flows were generated from operating activities in the first half of the year, totalling approx. Euro 8.5 million. Cash and cash equivalents were approx. Euro 16.4 million, despite CAPEX of approx. Euro 4.1 million in IT infrastructure related to new orders and the payment of Group dividends for approx. Euro 4.1 million.

The value of treasury shares at June 30, 2020 not included in the calculation was approx. Euro 16.0 million.

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Significant events

On January 7, 2020 the Company signed a loan contract for a maximum of Euro 40 million, with a banking syndicate comprising Banca IMI S.p.A., as arranger and agent bank, and Intesa Sanpaolo S.p.A. and Banco BPM S.p.A. as lending banks.

The loan, principally to support the WIIT Group's acquisition-led growth strategy on the Italian and international market and investment plan, stipulates the following key terms and conditions:

• the composition of the loan as (i) an amortising credit line for a maximum Euro 15 million, with maturity of December 31, 2025; (ii) a bullet credit line of a maximum Euro 15 million, with maturity of June 30, 2026; and (iii) an amortising credit line for a maximum Euro 10 million, with maturity of December 31, 2024;
• an annual interest rate based on the reference Euribor and an increasing or decreasing variable margin according to the change in the NFP/EBITDA ratio;
• EBITDA/net financial charges and NFP/EBITDA covenants which, at the date of this press release, are respected;
• the pledging, in favour of the lending banks, of the holdings representing the share capital of certain target companies acquired by WIIT in execution of its growth strategy.

In accordance with best market practice, the loan contract in addition contains provisions concerning, among others, mandatory early settlement events, conditions on disbursements, declarations and guarantees, limitations on debt and corporate transactions, in addition to dividend distribution limits.

On January 9, 2020, the first tranche of the above loan was issued for Euro 10 million.

On January 15, 2020, following the agreement signed on December 20, 2019, WIIT S.p.A. signed agreements for the gradual acquisition of 100% of the share capital of Etaeria S.r.l. ("Etaeria"), a Kelyan Group company providing cloud and cyber security services, in addition to the acquisition of the Aedera S.r.l. (Kelyan Group) business, provider of IT services and solutions for the digitalisation of companies in SAAS mode (the "Aedara business").

The agreements stipulate the initial acquisition of a 60% majority holding in Etaeria for consideration of approx. Euro 3.5 million, in addition to the variable price component subject to the achievement

of the 2019 full-year earnings objectives. The acquisition of the Etaeria shares also involves the payment of an advance for the acquisition of the residual 40%, for which put and call options are stipulated, to which variable price components are linked ("earn out"), subject to the achievement of set Etaeria earnings objectives.

In relation to the Aedera business unit, the estimated consideration on closing amounted to approx. Euro 1.4 million, in addition to the variable price component (earn out) for approx. Euro 0.9 million, subject to the achievement of the result objectives by the Aedera business unit in the 2019-2022 period.

On May 4, 2020, the company obtained from the Ministry for Economic Development the tax credit recognised to SME's for consultancy costs incurred from January 1, 2018 until December 31, 2020 for their listing on a regulated market. The tax credit for Euro 403,049.00 shall be used according to the means set out in Article 7 of the above Ministerial Decree of April 23, 2018. This credit has been included in the financial statements.

On May 21, 2020, a tranche of the loan signed on January 7,2020 was issued for Euro 2.5 million.

Significant events subsequent to June 30, 2020

On July 2, 2020, the company signed a multi-year extension to an existing contract, for a total value of approx. Euro 4.8 million, with a leading Italian global player in the luxury sector.

The company has reconfirmed its confidence in WIIT by extending the existing contract through a multi-year agreement for services related to the management of the Group's critical environments. All services are managed and governed centrally with active support 7 days a week, 24 hours a day, and seek to ensure the usability and continuity of the main business processes and multi-channel sales processes through a structured and resilient management model and Hybrid Cloud technologies capable of ensuring the scalability necessary to support future growth in a fast and secure way.

Outlook and COVID-19 emergency

Despite the major uncertainties and fears regarding the social and economic repercussions of the health emergency, related the spread of the COVID-19 pandemic, 2020 for WIIT is still considered a year of significant revenue and margin growth compared to 2019.

Company operations continue in terms of marketing activities to build the Brand, the analysis of the specific needs of the Company's Targets and the preparation of the relative promotional campaigns.

WIIT - thanks to a business model based on long-term orders and recurring revenues - has not suffered significant revenue impacts. In fact, both revenues and the operating margin are in line with budget forecasts. No revisions to the budget or impairment tests are necessary, therefore. As of Q1, strong interest has been shown by existing and new customers in the smart working and cyber-security services provided through WIIT's Cloud platform. Acting conservatively, however, in light of the uncertainty surrounding the effects on working capital of a possible slowdown in collections and non- performing positions attributable to certain customers that are in turn more significantly affected by the COVID-19 emergency, in April 2020 the Parent Company subscribed to a moratorium that suspended the repayment of bank loans for six months. This allowed the company to agree payment deadline extensions with some of its customers. The variety of sectors in which the Company operates and its good financial condition, in addition to its access to liquidity (with the upside of treasury shares) and lines of credit approved by credit institutions but not drawn down are circumstances that mitigate potential financial risk.

In response to the COVID-19 risk, the Company promptly updated its Risk Assessment Document, with specific regards to biological risks, to comply with the rules and recommendations issued by the authorities. In particular, the Company adopted the measures indicated in the decrees of the Prime