Nordecon

Investor Presentation • May 4, 2023

NORDECON

Investor presentation Q1 2023

Business model

Industrial buildings

Public buildings

Residential buildings

Commercial buildings

Other infrastructure Environmental engineering Utility networks Specialist engineering Bridges, viaducts

• Port construction
• Rail construction

Road construction and maintenance Road construction Road maintenance

2

STRATEGIC AGENDA FOR 2023-2027

with a focus on efficient use of resources. In Estonia, we will operate in the building and infrastructure construction as well as housing development segments. In foreign markets (Finland, Sweden and Ukraine), we will compete as a general works.	The group will grow, mostly organically, We will provide our people with grow by at least 5% per year. and inspiring work environment and a motivation system that collaboration and initiative. We will improve our profitability by planning and managing our design and construction operations more precisely. contractor and a provider of concrete We will streamline our work and decision- making processes by implementing modern digital solutions. We will maintain the order books of our different operating segments in balance. We will set our sustainable development goals and adopt an action plan to achieve them.	fosters Operating margin for the year will be consistently above 3%. Operating profit per employee will increase to at least €10 thousand per year. We will deliver a strong dividend yield for Nordecon's shareholders.
BUSINESS LINES AND MARKETS	ACTIVITIES	FINANCIAL TARGETS

AJAMAJA OFFICE BUILDING AT ROTERMANNI 6

LOCATION Tallinn

customer Rotermann City OÜ

ARCHITECT KOKO architects

construction period April 2019 - April 2021

CONTRACTOR Nordecon AS

PROJECT MANAGER Oleg Kaas

Period in Brief

The group's revenue for the first quarter of 2023 was €47,653 thousand, roughly 30% less than in the same period last year, when the figure was €68,453 thousand. The Buildings segment generated revenue of €44,789 thousand (Q1 2022: €62,814 thousand) and the Infrastructure segment revenue of €2,849 thousand. (Q1 2022: €5,569 thousand). The decrease in both segments was expected and is attributable to market contraction.	Nordecon ended the first quarter of 2023 with a gross profit of €1,322 thousand (Q1 2022: €1,147 thousand) and a gross margin of 2.8% (Q1 2022: 1.7%). Profitability improved due to higher profitability in the Buildings segment, which delivered a gross margin of 5.1% (Q1 2022: 4.1%). A large share of fixed costs in combination with a 49% decrease in revenue triggered a sharp margin decline in the Infrastructure segment.	The group's administrative expenses for the period were €1,870 thousand. Compared with a year earlier, administrative expenses grew by around 17% (Q1 2022: €1,601 thousand) due to growth in the cost of goods and services as well as staff costs. The ratio of administrative expenses to revenue (12 months rolling) increased year on year, rising to 2.5% (Q1 2022: 2.0%).
The group earned an operating loss of €605 thousand in the first quarter of 2023 (Q1 2022: profit €950 thousand). EBITDA for the period was €264 thousand (Q1 2022: €1,817 thousand). The operating profit and EBITDA for Q1 2022 were influenced by other income of €1,560 thousand, recognised after the approval of the restructuring plan of Swencn AB.	The group's order book stood at €199,947 thousand at 31 March 2023, reflecting a roughly 21% decrease year on year. In the first quarter of 2023, we signed new contracts of €84,930 thousand (Q1 2022: €63,167 thousand).	Operating activities in the first quarter of 2023 produced a net cash inflow of €705 thousand (Q1 2022: an outflow of €3,061 thousand). Operating cash flow is increasingly affected by the need to make prepayments to materials suppliers, as well as increased contractual retentions, which extend from 5 to 10% of the contract price.

KOHTLA-JÄRVE SPORTS AND HEALTH CENTRE

LOCATION Kohtla-Järve, Ida-Viru County

CUSTOMER Kohtla-Järve City Government

ARCHITECT OU Zoroaster

CONSTRUCTION PERIOD April 2019 - March 2021

CONTRACTOR Nordecon AS

PROJECT MANAGER Oleg Kaas

REVENUE AND OPERATING PROFIT

The gross margins of the Buildings segment were 5.1% for the first quarter of 2023 (Q1 2022: 4.1%) and those of the Infrastructure segment (26.3)% (Q1 2022: (23.0)%).

Due to the seasonal nature of the construction business, first-quarter results are affected by a large share of uncovered fixed costs, particularly in the Infrastructure segment.

Figure / Ratio	3M 2021	3M 2022	3M 2023
Revenue (EUR '000)	48 987	68 453	47 653
Revenue change	-10.8%	39.7%	-30.4%
Net profit/loss (EUR '000)	-1 911	-318	-1 674
Gross margin	-0,2%	1.7%	2,8%
EBITDA margin	-1.7%	2,7%	0.6%
Net marqin	-3.9%	-0,5%	-3.5%
Administrative expenses to revenue (12 month rolling)	2.3%	2.0%	2,5%

RAATUSE HEALTH CENTRE

LOCATION Tartu city

customer Tạrtu Kesklinna Perearstikeskus ou

DESIGNER U-Disain OÜ

CONSTRUCTION PERIOD February 2020- August 2021

CONTRACTOR Nordecon Betoon OÜ/ Embach Ehitus OU

PROJECT MANAGER Ahti Kala

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Revenue by Geographic Regions

■ Estonia = Finland ■ Ukraine = Sweden ■ Latvia ■ Lithuania

Lithuania 0% 0%

0%

The revenue contribution of Dueso Russia's military invasion Finnish revenues include Nordecon did not generate any foreign markets has decreased of Ukraine, the business mainly subcontracting revenue and had no ongoing year on year, dropping to 2% of volumes of Eurocon Ukraine from the provision of concrete construction contracts in the the group's total revenue for TOV the first quarter of 2023.

decreased have considerably.

works.

Swedish market. Nor did the group generate any revenue in Latvia and Lithuania, where we operate on a project basis.

9

Order book and revenues

The group's order book stood at €199,947 thousand at 31 March 2023, reflecting a roughly 21% decrease year on year.

The Buildings segment accounted for 75% and the Infrastructure segment for 25% of the group's total order book at 31 March 2023 (31 March 2022: 88% and 12%, respectively).

Compared with 31 March 2022, the order book of the Buildings segment has decreased by 32% while the order book of the Infrastructure segment has increased by 64%.

ORDER BOOK

KINDLUSE SCHOOL

LOCATION Rae, Harju County

customer Rae Rural Municipality Government

DESIGNER Sweco Projekt AS

construction period November 2019 - May 2021

CONTRACTOR Nordecon AS

PROJECT MANAGER Silver Sein

Infrastructure Buildings

80

20

Engineering ( incl. Hydraulic engineering) Road construction and maintenance

Environmental engineering

Commercial buildings

Apartment buildings

facilities

Industrial and warehouse

COOP/KONSUM SUPERMARKET

LOCATION Käina, Hiiu County

customer Hiiumaa Consumers Cooperative Association

ARCHITECT DAGOpen Arhitektuuribüroo

CONSTRUCTION PERIOD December 2020— June 2021

CONTRACTOR Nordecon Betoon OÜ

PROJECT MANAGER Reino Mälk

Share and shareholders

Largest shareholders in Nordecon AS at 31 March 2023

Shareholder	Number of shares	Ownership interest (%)
AS Nordic Contractors	16 563 145	51.16
Luksusjaht AS	4 322 342	13.35
Toomas Luman	707 000	2.18
Olegs Radcenko	574 200	1.77
Lembit Talpsepp	376 239	1.16
Nõmme Erahariduse SA	370 370	1.14
SEB Pank AS clients SEB Life and Pension Baltic SE	300 000	0.93
Estonian branch	255 000	0.79
Genadi Bulatov	250 600	0.77
Endel Palla	200 000	0.62

Index/equity	1 January 2023	31 March 2023	+ / -
OMX Tallinn	1,766.73	1,867.1	5.68%
PNCN1T	€0.69	€0.79	14.49%

Nordecon AS Tel: +372 615 4400 www.nordecon.com Toompuiestee 35, Tallinn 10149 Estonia

Head of Investor Relations Andri Hõbemägi Tel: +372 615 4400 andri.hobemagi@nordecon.com