Roblon A/S : maintains full-year profit guidance for 2022/23

Contents

02 Highlights

1. Financial highlights and ratios for the Group
2. Interim report for Q1 2022/23
3. Full-yearguidance for 2022/23
4. Financial calendar and company announcements
5. Statement by Management
6. Consolidated income statement and statement of comprehensive income
7. Consolidated balance sheet
8. Consolidated statement of changes in equity
9. Consolidated statement of cash flows
10. Notes to the financial statements

Interim report Q1 2022/23

Roblon A/S

Nordhavnsvej 1

9900 Frederikshavn

CVR-nr. 57 06 85 15

Interim report for Q1 2022/23

Roblon maintains full-year profit guidance for 2022/23.

The Group's reported revenue for the first quarter of 2022/23 did not match expectations, whereas EBIT was better than expected, driven by an improved gross margin.

Selected financial highlights:

Full-year guidance for 2022/23 is maintained:

Quarterly revenue (DKKm)

• The Group's order intake amounted to DKKm 100.1 in Q1 2022/23 (DKKm 114.8). The order intake is expected to rise in the coming three quarters.
• At the end of January 2023, the Group's order book amoun- ted to DKKm 132.5 (DKKm 116.8).
• Revenue of DKKm 81.3 (DKKm 78.3), which was less than expected.
• Gross margin of 52.5% (46.6%).
• Operating profit before depreciation, amortisation and impairment and special items (EBITDA) of DKKm 3.4 (DKKm 1.5).
• Operating loss before special items (EBIT) of DKKm 3.6 (a loss of DKKm 4.6).
• Financial items amounted to a net expense of DKKm 1.9 (net income of DKKm 2.5).

• Revenue in the DKKm 430-470 range (2021/22: DKKm 380.9).
• Operating profit before depreciation, amortisation and impairment and special items (EBITDA) in the range of DKKm 40-55 (2021/22: DKKm 23.4).
• Operating profit before special items (EBIT) in the range of DKKm 10-25 (2021/22: a loss of DKKm 3.8).
• Management continues to expect revenue and earnings in 2022/23 to be under pressure from the international political situation, currency and interest rate challenges, energy prices, inflation and derived market, supply and logistics challenges and uncertainties. Accordingly, the full-year guidance for the year remains subject to sub- stantial uncertainty.

125
100
75
50
25
0	Q1	Q2	Q3	Q4

Quarterly EBIT (DKKm)

20

15

10

5

0 -5

-10

Q1 Q2 Q3 Q4

2021/22		2022/23

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Interim report for Q1 2022/23

Financial highlights

for the Group

DKKm	Unit	Q1	Q1	FY
	2022/231	2021/221	2021/22
Orders
Order intake	DKKm	100.1	114.8	415.4
Order book	DKKm	132.5	116.8	111.8
Income statement
Revenue	DKKm	81.3	78.3	380.9
Gross profit	DKKm	42.7	36.5	181.2
Operating profit/loss before depreciation, amortisation and impairment and special	DKKm	3.4	1.5	23.4
items (EBITDA)
Operating profit/loss before special items (EBIT)	DKKm	-3.6	-4.6	-3.8
Net special items	DKKm	-	-3.1	-6.8
Net financial items	DKKm	-1.9	2.5	9.3
Profit/loss before tax from continuing operations	DKKm	-5.6	-5.2	-1.4
Profit/loss for the period from continuing operations	DKKm	-4.2	-4.7	-2.3
Profit/loss for the period from discontinued operations	DKKm	0.1	0.2	0.5
Profit/loss for the period	DKKm	-4.2	-4.5	-1.8
Balance sheet
Cash and securities	DKKm	8.2	20.4	11.9
Assets	DKKm	351.2	326.1	373.1
Working capital	DKKm	152.8	112.4	155.9
Invested capital	DKKm	204.9	192.4	206.5
Equity	DKKm	210.6	214.4	218.8
Cash flows
Cash flow from operating activities	DKKm	0.8	-5.8	-27.0
Cash flow from investing activities	DKKm	-2.8	-7.7	-25.2
Of which investment in marketable securities	DKKm	-	42.3	42.3
Of which investment in property plant and equipment	DKKm	-2.3	-2.0	-17.9
Cash flow from financing activities	DKKm	-1.7	30.4	60.5
Depreciation, amortisation and impairment, total	DKKm	-7.1	-6.1	-27.2
Cash flow for the period	DKKm	-3.7	16.8	8.3

DKKm	Unit	Q1	Q1	FY
	2022/231	2021/221	2021/22
Ratios
Book-to-bill ratio	%	123.1	146.6	109.1
Revenue growth	%	3.8	85.1	52.4
Gross margin	%	52.5	46.6	47.6
EBIT margin	%	-4.5	-5.9	-1.0
ROIC/return on average invested capital2	%	-6.7	-10.7	-2.0
Equity ratio	%	60.0	65.7	58.6
Return on equity2	%	-6.6	-8.0	-0.8
Employees
Average no. of full-time employees	No.	289	204	279
Gross profit per full-time employee	DKKm	0.1	0.2	0.6
Per share ratios
Earnings per DKK 20 share (EPS)2	DKK	-2.1	-2.6	-1.3
Price/earnings ratio (PE)	DKK	-75.4	-58.1	-108.0
Cash flow from operations per DKK 20 share	DKK	0.4	-9.5	-15.1
Book value of shares2	DKK	123.0	119.8	122.4
Market price per share	DKK	156.0	151.0	141.0
Price/book value		1.3	1.3	1.2

1. The interim report has not been audited or reviewed by the Company's auditors .
2. The ratio is calculated on a full-year basis.

The ratios are defined in note 33 to the 2021/22 annual report, Financial ratio definitions and formulas.

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Interim report for Q1 2022/23

Interim report for Q1 2022/23

Roblon's management reporting is based on one segment comprising the following product groups:

• FOC (comprising cable materials and cable machinery for the fibre optic cable industry)
• Composite (comprising composite materials for onshore and offshore industries)

Consolidated income statement

Order intake and order book

The Group's order intake amounted to DKKm

1. in Q1 2022/23 (DKKm 114.8). The DKKm

1. net decline covered a DKKm 40.3 decline in the FOC product group and a DKKm 25.6 improvement in the Composite product group. Order intake is expected to rise for both product groups in the coming three quarters.

The decline in the FOC product group had been expected, due mainly to post-COVID-19 challenges affecting the US market in the second half of 2022.

For Roblon's customers, this meant significant stock building as well as adverse effects of labour shortages and project delays.

The improvement in Composite was mainly driven by a higher level of activity in the offshore oil & gas industry, which, according to market information from customers and independent market analysts, is expected to continue in the coming three to five years.

At the end of January 2023, the Group's order book stood at DKKm 132,5 (DKKm 116.8), distributed with DKKm 49.2 (DKKm 91.9) in the FOC product group and DKKm 83.3 (DKKm 24.9) in

the Composite product group.

Revenue

Roblon reported revenue of DKKm 81.3 (DKKm 78.3) for Q1 2022/23, which was below Manage- ment's expectations.

The USD/CZK exchange rate development had a negative impact of DKKm 1.2 on reported revenue for Q1 2022/23.

The DKKm 3.0 net improvement covered a DKKm 20.0 decline in the FOC product group and a DKKm 23.0 improvement in the Composite product group.

As expected, revenue for Q1 2022/23 was adversely affected by market conditions in the FOC industry, which are expected to be temporary. See the mention above under order intake.

The Composite product group recorded an improvement in Q1 2022/23, the majority of which was attributable to the offshore oil & gas indu- stry, while DKKm 4.5 of the improvement was due to the fact that the Czech company acquired at 3 January 2022 was consolidated for the full three months of Q1 2022/23 compared with one month in the year-earlier period.

Gross profit and gross margin

The Group's gross profit amounted to DKKm

42.7 (DKKm 36.5) and the gross margin for Q1 2022/23 was 52.5% (46.6%). In particular, the gross profit benefited from a favourable product mix and improved profitability of the FOC pro- duct group in Roblon US and the part of produc- tion relocated to the Czech Republic.

Other external costs

Other external costs amounted to DKKm 9.5 (DKKm 9.4) in Q1 2022/23, despite high inflation and the increased level of activity. External costs were significantly below the reported level in Q4 2021/22 of DKKm 13.2, mainly as a result of cost savings.

Staff costs

Staff costs increased to DKKm 30.8 (DKKm 27.1) in Q1 2022/23, a DKKm 3.7 increase relative to the year-earlier period, in which the Czech subsidiary was only consolidated from the acquisition date at 3 January 2022. Reported staff costs in Q4 2021/22 amounted to DKKm 33.3.

Operating profit/loss before depreciation, amortisation and impairment and special items (EBITDA)

In Q1 2022/23, EBITDA amounted to DKKm 3.4 (DKKm 1.5), which was above Management's expectations.

Depreciation, amortisation and impairment

The Group's depreciation, amortisation and impairment for Q1 2022/23 was DKKm 7.1 (DKKm 6.1). The increase over the previous year was due to increased investments in production equipment to enhance capacity and production, primarily for Roblon's Czech subsidiary.

Operating profit/loss before special items (EBIT)

In Q1 2022/23, EBIT amounted to a loss of DKKm

3.6 (a loss of DKKm 4.6), which was above Mana- gement's expectations.

Net financial items

The Group's financial items for Q1 2022/23 amounted to a net expense of DKKm 1.9 (net income of DKKm 2.5). The net amount was made up of DKKm 1.0 in interest expenses and DKKm

0.9 in negative foreign exchange adjustments. The year-earlier figure included a positive foreign exchange adjustment of DKKm 2.1 on loans to the US subsidiary.

In the parent company, parts of the intra-group balance in Roblon's US subsidiary at 1 Novem- ber 2022 was converted to shares, and parts of the balance were converted into a long-term receivable, which is considered part of the net investment and therefore adjusted through comprehensive income.

Profit/loss before tax from continuing operations

For Q1 2022/23, the Group posted a loss before tax from continuing operations of DKKm 5.6 (a loss of DKKm 5.2).

Profit/loss from discontinued operations

In 2019/20, Roblon wrote off a receivable relating to the sale of a former Roblon division.

In the current financial year, Roblon has received a partial repayment of DKKm 0.1 (DKKm 0.2) on the receivable, and at the end of Q1 2022/23 the profit/loss from discontinued operations after tax was recognised at DKKm 0.1.

Profit/loss after tax

Roblon realised a net loss for the period of DKKm 4.2 (a net loss of DKKm 4.5). Tax for the period has been calculated at the applicable tax rates in the countries in which the Group has

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Interim report for Q1 2022/23

operations.

The overall impact of the US dollar (USD/DKK) and Czech koruna (CZK/DKK) exchange rates was immaterial.

Consolidated balance sheet

The Group's total assets at 31 January 2023 amounted to DKKm 351.2 (DKKm 326.1).

Total investments in intangible assets for Q1 2022/23 amounted to DKKm 0.5 (DKKm 0.9), in the current year comprising investments in development projects.

Investments in property plant and equipment amounted to DKKm 2.4 (DKKm 2.7) in Q1 2022/23, mainly comprising investment projects to strengthen production capacity in the FOC business in Roblon US. Property, plant and equipment sold amounted to DKKm 0.1 (DKKm 0.8).

The investment in Roblon US was tested for impairment, which did not give rise to any write -down.

Inventories amounted to DKKm 112.4 (DKKm 86.3) at 31 January 2023. The rising level of activity throughout the Group requires larger inventories of raw materials and components. The increased value of inventories was furthermore due to sharply rising raw materials prices in 2022.

The Group regularly implements decisions and actions with a view to reducing working capital. Among these are initiatives targeting the commercial terms and conditions with customers and suppliers, optimisation of sales and operational processes and ongoing monitoring

of slow-moving inventories.

The Group's equity at 31 January 2023 amounted to DKKm 210.6 (DKKm 214.4). The equity ratio at 31 January 2023 was 60.0% (65.7%).

Consolidated cash flows

The Group's cash flow from operating activities for Q1 2022/23 was an inflow DKKm 0.8 (an outflow of DKKm 5.8), driven by a positive development in working capital.

Total cash flow from investing activities was an outflow of DKKm 2.8 (an outflow of DKKm 7.7).

Cash flow from financing activities for Q1 2022/23 was an outflow of DKKm 1.7 (an inflow of DKKm 30.4) and mainly consisted of lease payments, while the year-earlier figure consisted of financing of the acquired Czech subsidiary.

Capital resources

At 31 January 2023, net deposits of cash amounted to DKKm 8.2 (DKKm 20.4).

The Group's total credit facilities amounted to DKKm 108.0 (DKKm 80.0). Roblon had an un- drawn credit facility at 31 January 2023 of DKKm 25.2 (DKKm 18.9).

Total cash resources at 31 January 2023 amounted to DKKm 33.3 (DKKm 39.3).

Product development

In Q1 2022/23, the Group incurred product development costs of DKKm 1.7 (DKKm 1.9).

Full-year guidance for 2022/23

At the end of the first quarter of 2022/23, Management maintains the following full-year

guidance for 2022/23:

• Revenue in the DKKm 430-470 range (2021/22: DKKm 380.9)
• Operating profit before depreciation, amortisation and impairment and speci- al items (EBITDA) in the range of DKKm 40-55 (2021/22: DKKm 23.4).
• Operating profit before special items (EBIT) in the range of DKKm 10-25 (2021/22: a loss of DKKm 3.8).

The full-year guidance is maintained on the basis of the following:

• The FOC market is expected to start growing over the coming months.
• We expect further profitability impro- vements in Roblon US as a result of completed and current investment programmes that are expected to be completed in the spring of 2023.
• Profitability improvements are expected in the FOC business relocated from the parent company to the subsidiary in the Czech Republic.
• Substantial improvements are expe- cted in the Composite product group compared to reported 2021/22 levels, particularly in supplies to the offshore oil and gas industry. This is supported by the reported revenue for Q1 2022/23, the larger order book at the end of January 2023 and an expected higher level of activity with the Group's custo- mers in 2023.

In the following Forward-looking statements section, we mention a number of specific uncertainties may might affect the Company's ability to realise Management's profit guidance. Towards the end of December 2022, a fire broke out at the premises of one of Roblon's suppliers of a specific raw materi- al, which a few of our customers in the Composite product group require as part of their product deliveries. Roblon has a multi-year contract with the supplier in question, but it is suspended in force majeure situations.

In all material respects, Roblon has sufficient inventories to execute and deliver the current order book and expected new orders until the end of April 2023. Roblon communicates with the supplier on an ongoing basis to secure the Group's future deliveries in 2023 and support our market potential in 2023. The supplier is expected to fully re-establish its production capacity by summer 2023. At present, Management expects to procure sufficient quantities from the supplier to execute Roblon's expected Composite orders for delivery in the current financial year.

Head office building put up for sale

In early 2020, the Group decided to put its head office in Frederikshavn up for sale. Showings are arranged from time to time for prospective buyers and the sales process continues. There are currently no specific buyers for the property, however. After the sale, the Group's Danish activities will be centred at Roblon's facilities in Gærum, which currently house production and various administrative functions.

As well as generating positive synergies in the day- to-day operations, this initiative is also expected to have a positive impact on Roblon's results and equity going forward.

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