Nordecon

Investor Presentation • Nov 4, 2021

NORDECON

Investor presentation Q3 2021

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

STRATEGIC AGENDA FOR 2019-2022

The Group will grow, mostly organically, with a focus on more efficient use of its existing resources.

In Estonia, we will operate, as market leader, in both the building and infrastructure construction segments.

In Sweden, we will focus on general contracting in Stockholm and the surrounding area.

In Finland, we will focus on general contracting and concrete works in Helsinki and the surrounding area.

In Ukraine, we will focus on general contracting and concrete works, primarily in Kiev and the surrounding area.

Improving profitability through more precise planning of our design and construction operations.

Increasing our design and digitalisation capabilities.

Simplifying and automating work and decision-making processes.

Monitoring the balance between the contract portfolios of different business segments.

Valuinq balanced teamwork where youthful energy and drive complement long-term experience.

Noticing and recognising each employee's individual contribution and initiative.

Revenue will grow at least 10% per year.

The contribution of foreign markets will increase to 20% of revenue.

Real estate development revenue will grow to at least 10% of revenue earned in Estonia.

Operating margin per year will be consistently above 3%.

Operating profit per employee will increase to at least 10 thousand euros per year.

On average, at least 30% of profit for the year will be distributed as dividends.

FINANCIAL TARGETS

BUSINESS LINES AND MARKETS

ACTIVITIES

ESTONIAN ACADEMY OF SECURITY SCIENCES LEARNING CENTRE IN NARVA

LOCATION Narva, Ida-Viru county

CUSTOMER Academy of Security Sciences

ARCHITECT 3+1 architects

construction period February 2019 - August 2020

CONTRACTOR Nordecon AS

PROJECT MANAGER Viljo Niit

Period in Brief

The group's revenue for the first nine months	Nordecon ended the first nine months of 2021	The group's administrative expenses for the
of 2021 was €208,894 thousand, around 4%	with a gross profit of €4,895 thousand (9M	first nine months of 2021 were €4,267
lower than a year earlier when revenue	2020: €9,515 thousand) and a gross margin of	thousand.
amounted to €217,664 thousand.	2.3% (9M 2020: 4.4%).	Compared to the same period in 2020,
The decrease is largely attributable to revenue from foreign operations (particularly Sweden), which dropped by 58%. Revenue generated in Estonia grew by 3% year on year. In segment terms, revenue from the Buildings segment decreased by 9% while revenue from the Infrastructure segment grew by 13% year on year.	In the third quarter, profitability improved significantly: the group delivered a gross profit of €3,589 thousand (Q3 2020: €3,508 thousand) and a gross margin of 3.9% (Q3 2020: 4.3%). Nine-month profitability was strongly influenced by growth in input prices, which mainly affected contracts signed in 2020.	administrative expenses decreased by around 20% (9M 2020: €5,312 thousand), mainly through a decline in personnel expenses. The ratio of administrative expenses to revenue (12 months rolling) remained stable at 2.1% (9M 2020: 2.1%).
The group's operating profit for the nine	The group's order book stood at €293,141	Operating activities in the 9 months of 2021
months of 2021 was €339 thousand (9M 2020:	thousand at 30 September 2021, a 36% increase	produced a net cash inflow of €2,438 thousand
€3,952 thousand).	year on year.	(9M 2020: an outflow of €279 thousand).
EBITDA amounted to €2,961 thousand (9M In the third quarter, we signed new contracts of 2020: €6,512 thousand).	€102,326 thousand (Q3 2020: €87,751 thousand).	Operating cash flow is strongly influenced by the fact that the contracts signed with most public and private sector customers do not require them to make advance payments while the group has to make prepayments to subcontractors and suppliers.

SAUE MUNICIPAL OFFICE BUILDING

LOCATION Saue, Harju county

customer Saue Municipal Government

ARCHITECT molumba

construction period June 2019 — June 2020

CONTRACTOR Embach Ehitus OÜ

PROJECT MANAGER Lauri Tomp

REVENUE AND OPERATING PROFIT

The gross margin of the Buildings segment was 3.0% for nine months and 3.8% for the third quarter compared with 4.7% and 4.0% for the nine months and third quarter in 2020.

The gross margin of the Infrastructure segment was 1.8% for nine months and 4.0% for the third quarter compared with 4.6% and 5.9% for the nine months and third quarter in 2020.

Figure / Ratio	9M 2019	9M 2020	9M 2021
Revenue (EUR '000)	172 237		217 664 208 894
Revenue change	2,8%	26.4%	-4%
Net profit/loss (EUR '000)	2 876	3 004	-368
Gross margin	4,5%	4.4%	2,3%
EBITDA margin	2.7%	3.8%	1.4%
Net margin	1.7%	1.4%	-0.2%
Administrative expenses to revenue (12 month rolling)	2,8%	2.7%	2.1%

WATERFRONT Promenade in Sillamäe

LOCATION Sillamäe, Ida-Viru county

customer Sillamäe Town Government

DESIGNER Selektor Projekt OÜ

CONSTRUCTION PERIOD August 2019 — December 2020

CONTRACTOR Nordecon AS

PROJECT MANAGER Ivo Lõhmus

Revenue by Geographic Regions

▪ Estonia ▪ Ukraine ▪ 『 Finland ▪ Sweden

	9M 2019	9M 2020	9M 2021
Estonia	91%	88%	95%
Ukraine	2%	1%	1%
Finland	4%	5%	4%
Sweden	3%	6%	0%

significantly

foreign markets decreased was a steep fall in Swedish the revenue base is a our chosen foreign markets are year-on-year, revenues, which dropped to less consciously deployed strategy also volatile and strongly affect accounting for around 5% of the total. The by which we mitigate the risks our current results. the group's total revenue for amount and share of revenue resulting - from - excessive the first nine months of 2021. generated in in Finland and reliance on a single market. Ukraine remained comparable to the same period last year.

The revenue contribution of Amajor factor in the decline Geographical diversification of However, conditions in some of

Order book and revenues

The group's order book stood at €293,141 thousand at 30 September 2021, a 36% increase year on year.

The Buildings segment still dominates with 87% while the share of the Infrastructure segment is 13% (30 September 2020: 79% and 21%, respectively).

Compared with 30 September 2020, the order book of the Buildings segment has grown by 51% and the order book of the Infrastructure segment had decreased by 18%.

In the third quarter, we signed new contracts of €102,326 thousand (Q3 2020: €87,751 thousand).

350 000 300 000 250 000 200 000 150 000 100 000 50 000 0 a be and the possible of the police of the poly of the poly of the poly of the poly of ■Order backlog (quarter end) ■Revenue (TTM)

ORDER BOOK

TERMINAL D IN OLD CITY HARBOUR

LOCATION Tallinn

customer AS Tallinna Sadam

DESIGNER R-Konsult OÜ

construction period June 2018 - July 2020

CONTRACTOR Nordecon AS

PROJECT MANAGER Marek Sööt

Revenue distribution

In the first nine months of 2021, the Buildings and the Infrastructure segment generated revenue of €154,599 and €54,029 thousand thousand, respectively. The corresponding figures for the same period in 2020 were €169,439 thousand and €48,025 thousand.

30

70

In the Buildings segment, the revenues of all subsegments decreased year on year, except for the commercial buildings subsegment that posted 7% revenue growth.

The revenue contributions of the commercial buildings, public buildings and apartment buildings subsegments were practically equal while the revenue generated by the industrial and warehouse facilities subsegment continued to be modest.

In the Infrastructure segment, the largest revenue contributor is the road construction and maintenance subsegment, which increased its revenue by around 21% year on year.

TISKREOJA RESIDENTIAL AREA

LOCATION Tiskre, Harju County

customer Tiskreoja OÜ

ARCHITECT PIN Arhitektid OÜ

construction period October 2019 - October 2020

CONTRACTOR Nordecon Betoon OÜ

PROJECT MANAGER Harry Rööpson

Share and shareholders

Largest shareholders in Nordecon AS at 30 September 2021

	Number of shares	Ownership interest (%)
AS NORDIC CONTRACTORS	16 933 515	52.30
LUKSUSJAHT AS	4 278 403	13.22
TOOMAS LUMAN	650 000	2.01
Olegs Radcenko	584 867	1.81
SEB PANK AS CLIENTS	425 000	1.31
Lembit Talpsepp	362 239	1.12
Mati Kalme	330 000	1.02
SEB LIFE AND PENSION BALTIC SE
EESTI FILIAAL	255 000	0.79
GENADI BULATOV	250 600	0.77
SVENSKA HANDELSBANKEN CLIENTS ACCOUNT	210 556	0.65

Indeks/aktsia	01.01.2021*	30.09.2021	+ / -
OMX Tallinn	1 343,72	1 932,45	43,81%
NCN1T	1,14 EUR	1,27	11,4%

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