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Datalogic

Quarterly Report May 25, 2023

4452_10-q_2023-05-25_4ff4c3b9-d8c6-4d19-9f0f-821061a72164.pdf

Quarterly Report

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Consolidated Interim Report March 31, 2023

TABLE OF CONTENTS

GROUP STRUCTURE pg. 3
COMPOSITION OF CORPORATE BODIES pg. 4
REPORT ON OPERATIONS pg. 5
CONSOLIDATED FINANCIAL STATEMENTS pg. 17
Consolidated Statement of Financial Position
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Cash Flows
Consolidated Changes in Equity

EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS pg. 24

Information on the Statement of Financial Position

Information on the Income Statement

ANNEXES

  • ⋅ Certification by the Manager responsible for the preparation of the Company's financial reports
  • ⋅ Consolidation scope
  • ⋅ Reconciliation of Alternative Performance Measures
  • ⋅ Restatement 2022

DISCLAIMER

This document contains forward-looking statements relating to future events and operating, income and financial results of the Group. These forecasts have by nature an element of risk and uncertainty, as they depend on the materialisation of future events and developments. Actual results may differ even significantly from those disclosed due to a variety of factors, most of which beyond the Group's control.

COMPOSITION OF CORPORATE BODIES

Board of Directors (1)

Romano Volta Executive Chairman (2) Valentina Volta Chief Executive Officer (2) Angelo Manaresi Independent Director Chiara Giovannucci Orlandi Independent Director Filippo Maria Volta Non-Executive Director Vera Negri Zamagni Independent Director Maria Grazia Filippini Independent Director Pietro Todescato Executive Director

Board of Statutory Auditors(3)

Diana Rizzo Chair Elena Lancellotti Standing Auditor Roberto Santagostino Standing Auditor

Giulia De Martino Alternate Auditor Eugenio Burani Alternate Auditor

Patrizia Cornale Alternate Auditor

Control, Risks, Remuneration and Appointments Committee

Angelo Manaresi Chairman Chiara Giovannucci Orlandi Independent Director Vera Negri Zamagni Independent Director

Independent Auditors (4)

Deloitte & Touche S.p.A.

(1) The Board of Directors will remain in office until the Shareholders' Meeting called to approve the financial statements at December 31, 2023.

(2) Legal representative before third parties.

  • (3) The Board of Statutory Auditors will remain in office until the Shareholders' Meeting called to approve the financial statements at December 31, 2024.
  • (4) Deloitte & Touche S.p.A. were appointed Independent Auditors for the nine-year period from 2019 to 2027 by the Shareholders' Meeting held on April 30, 2019 and will remain in office until the Shareholders' Meeting called to approve the financial statements at December 31, 2027.

Report on Operations

REPORT ON OPERATIONS

INTRODUCTION

This Consolidated Interim Report at March 31, 2023 was prepared in accordance with Article 154 ter of the T.U.F. and is drawn up in accordance with the International Financial Reporting Standards (IAS/IFRS) adopted by the European Union.

The amounts shown in the tables of the Directors' Report on Operations are expressed in Euro thousands, while the explanatory notes are expressed in Euro millions.

GROUP PROFILE

Datalogic S.p.A. and its subsidiaries ("Group" or "Datalogic Group") is a global technological leader in the automatic data capture and process automation markets. The Group is specialised in the design and production of barcode readers, mobile computers, detection, measurement and safety sensors, vision and laser marking systems and RFID. Its pioneering solutions help increase the efficiency and quality of processes along the entire value chain in the Retail, Manufacturing, Transportation & Logistics and Healthcare segments.

PERIOD HIGHLIGHTS

The following table summarises the Datalogic Group's key income and financial results at March 31, 2023 versus the same period of the prior year.

The income statement and balance sheet figures at March 31, 2023 include the balances of Pekat Vision, consolidated as a result of the acquisition finalized on March 21, 2022, while the comparative income statement figures for 2022 do not include the balances of the company, consolidated as of April 2022.

31.03.2023 % on
Revenue
31.03.2022 % on
Revenue
Change % chg. % chg.
net FX
Revenue 149,667 100.0% 137,928 100.0% 11,739 8.5% 7.2%
Adjusted EBITDA 13,477 9.0% 11,752 8.5% 1,725 14.7% 21.4%
Adjusted EBIT 5,373 3.6% 4,474 3.2% 899 20.1% 38.7%
EBIT 3,922 2.6% 2,278 1.7% 1,644 72.2% 108.7%
Profit/(Loss) for the period 3,182 2.1% 1,329 1.0% 1,853 139.4% 202.0%
Net financial position (NFP) (31,673) (77,663) 45,990

The Group ended first quarter 2023 with sales Revenue of €149.7 million, up by 8.5%, or €11.7 million, versus €137.9 million recorded in first quarter 2022 (+7.2% at constant exchange rates).

Adjusted EBITDA came to €13.5 million, improving versus €11.8 million in first quarter 2022. As a percentage of sales, it grows from 8.5% to 9.0%.

Adjusted EBIT stood at 3.6% of revenue and amounted to €5.4 million (€4.5 million at March 31, 2022).

Net profit for the period amounted to €3.2 million, more than doubling both in absolute terms and as a percentage of revenue versus the same period of the prior year.

Sales from new products (Vitality Index) in first quarter 2023 accounted for 6.3% of revenue, down from 13.3% in first quarter 2022.

Net Financial Debt at March 31, 2023 stood at €31.7 million, an improvement of €10.3 million versus December 31, 2022 and of €46.0 million versus March 31, 2022.

ALTERNATIVE PERFORMANCE MEASURES (NON-GAAP MEASURES)

Management uses certain performance measures, not identified as accounting measures under IFRS (NON-GAAP measures), to provide a clearer picture of the Group's performance. The measurement criterion applied by the Group might not be the same as the one adopted by other Groups and the measures might not be comparable with theirs. These performance measures, determined according to provisions set out by the Guidelines on performance measures, issued by ESMA/2015/1415 and adopted by CONSOB with Communication no. 92543 of December 3, 2015, refer only to the performance in the period related to this Consolidated Interim Report and the comparison periods. The performance measures must be considered as supplementary and do not supersede the information provided under the IFRS standards. The main measures adopted are described below.

  • Special Items: income items arising from non-recurring events or transactions, restructuring activities, business reorganization, write-downs of fixed assets, ancillary expense from acquisitions of businesses or companies or their disposals, including amortisation resulting from the recognition of purchase price allocation, and any other event deemed by Management not to represent current business activity.
  • EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation): profit/(loss) for the year from continuing operations before depreciation and amortisation of tangible and intangible fixed assets and rights of use, financials (including foreign exchange income and expense) and income tax.
  • Adjusted EBITDA: profit/(loss) for the year from continuing operations before depreciation and amortisation of tangible and intangible fixed assets and rights of use, financials (including foreign exchange income and expense), income tax and Special Items, as defined above.
  • EBIT (Earnings Before Interest, Taxes) or Operating Result: profit/(loss) for the year from continuing operations before financials (including foreign exchange income and expense) and income tax.
  • Adjusted EBIT or Operating Result: profit/(loss) for the year from continuing operations before financials (including foreign exchange income and expense), income tax and Special Items, as defined above.
  • Net Trade Working Capital: the sum of Inventory and Trade Receivables, less Trade Payables.
  • Net Working Capital: the sum of Net Trade Working Capital and Other Current Assets and Liabilities including Provisions for Current Risks and Charges.
  • Net Invested Capital: the total of Current and Non-Current Assets, excluding financial assets, less Current and Non-Current Liabilities, excluding financial liabilities.
  • NFP (Net Financial Position or Net Financial Debt): calculated in accordance with the provisions of "Warning Notice no. 5/21" of April 29, 2021 issued by CONSOB and referring to ESMA guideline 32-382-1138 of March 4, 2021.
  • Cash Flow from Operations: the sum of Adjusted EBITDA, changes in Net Trade Working Capital, expenditure in tangible and intangible fixed assets (excluding fixed assets under right of use recognised during the year according to IFRS 16), tax paid, financial expense/income, changes in Other Current Assets and Liabilities, and Special Items, as defined above, while excluding any other changes related to equity (such as dividend distributions and/or the purchase of treasury shares), to transactions of an extraordinary nature, the repayment and/or taking out of bank loans and/or other financial items in the NFP, and any other transaction that cannot be directly attributed to the company's business operations.

GROUP RECLASSIFIED INCOME RESULTS

The following table shows the main items of the income statement for the period versus the prior period, the results of which were restated as required by IAS 1 following certain reclassifications of cost items from operating costs to cost of goods sold and among the different uses of operating costs, for details of which reference is made to Annex 4 of this document:

31.03.2023 31.03.2022 Change % chg.
Restated
Revenue 149,667 100.0% 137,928 100.0% 11,739 8.5%
Cost of goods sold (87,267) -58.3% (82,546) -59.8% (4,721) 5.7%
Gross OperatingMargin 62,400 41.7% 55,382 40.2% 7,018 12.7%
Research and Development expense (16,662) -11.1% (14,116) -10.2% (2,546) 18.0%
Distribution expense (26,452) -17.7% (22,878) -16.6% (3,575) 15.6%
Administrative and General expense (13,908) -9.3% (13,657) -9.9% (251) 1.8%
Other (expense) income (5) 0.0% (257) -0.2% 252 -98.1%
Total operating costs and other expense (57,027) -38.1% (50,907) -36.9% (6,120) 12.0%
Adjusted EBIT 5,373 3.6% 4,474 3.2% 899 20.1%
Special Items-Other (Expense) and Income (260) -0.2% (748) -0.5% 488 -65.2%
Special Items- D&A from acquisitions (1,191) -0.8% (1,448) -1.0% 257 -17.7%
EBIT 3,922 2.6% 2,278 1.7% 1,644 72.2%
Net Financials (835) -0.6% (698) -0.5% (137) 19.6%
Foreign exchange gains/(losses) 657 0.4% (884) -0.6% 1,541 n.a.
EBT 3,744 2.5% 696 0.5% 3,048 437.8%
Tax (562) -0.4% 633 0.5% (1,195) n.a.
Profit/(Loss) for the period 3,182 2.1% 1,329 1.0% 1,853 139.4%
EBIT 3,922 2.6% 2,278 1.7% 1,644 72.2%
Special Items -Other (Expense) and Income 260 0.2% 748 0.5% (488) -65.2%
Special Items - D&A from acquisitions 1,191 0.8% 1,448 1.1% (257) -17.7%
Depreciation Tang. Fixed Assets and Rights of Use 4,112 2.7% 4,406 3.2% (294) -6.7%
Amortisation Intang. Fixed Assets 3,992 2.7% 2,871 2.1% 1,121 39.0%
Adjusted EBITDA 13,477 9.0% 11,752 8.5% 1,725 14.7%

Consolidated revenue amounted to €149.7 million at March 31, 2023, growing by 8.5% versus €137.9 million in first quarter 2022, with a buoyant performance in EMEAI. Americas was slightly up, while APAC declined. At constant exchange rates, the sales performance increased by 7.2%.

The breakdown by geographical area of Group revenue for the period, versus the same period of the prior year, is shown in the table below:

31.03.2023 % 31.03.2022 % Change % chg. % chg. net
FX
Italy 15,374 10.3% 14,410 10.4% 964 6.7% 6.7%
EMEAI (excluding Italy) 71,202 47.6% 61,211 44.4% 9,992 16.3% 15.9%
Total EMEAI 86,577 57.8% 75,621 54.8% 10,956 14.5% 14.1%
Americas 41,817 27.9% 40,628 29.5% 1,189 2.9% -1.4%
APAC 21,273 14.2% 21,679 15.7% (406) -1.9% -0.6%
Total revenue 149,667 100.0% 137,928 100.0% 11,739 8.5% 7.2%

Driving the Group's revenue growth is EMEAI, with a 14.5% revenue growth versus the same period of 2022, with Italy growing by 6.7%. Americas were up by 2.9% (-1.4% at constant exchange rates). APAC was down by 1.9% versus first quarter 2022 (-0.6% at constant exchange rates).

Gross Operating Margin amounted to €62.4 million (41.7% of sales) versus €55.4 million at March 31, 2022 (40.2% of sales), improving by 1.5% as a percentage of sales versus first quarter 2022, due mainly to an increase in price and mix that offset the decline in volumes.

Operating costs and other expense amounted to €57.0 million (€50.9 million at March 31, 2022), increasing as a percentage of sales by 1.2% versus 36.9% to reach 38.1%, especially on research and development and distribution expense.

Research and Development expense, amounting to €16.7 million, increased by 18.0% versus March 31, 2022, with the percentage of revenue increasing by 0.9% to 11.1% versus 10.2% in the same quarter of the prior year. Total monetary costs in R&D, before capitalisation of internal costs and without amortisation and depreciation (R&D Cash Out), amounted to €15.8 million (€14.5 million in the same period of the prior year), with a percentage of sales of 10.6% (10.5% in first quarter 2022).

Distribution expenseamounted to €26.5 million and was up by 15.6% versus first quarter 2022 (€22.9 million in 2022), with the percentage of revenue increasing by 1.1% from 16.6% to 17.7%. The change from the same period in the prior year is related mainly to increased personnel expense and increased sales and marketing initiatives and participation in trade fairs and events as well as customer visits.

Administrative and General expense amounted to €13.9 million at March 31, 2023, falling as a percentage of sales by 0.6% from9.9% to 9.3%, due mainly to the decrease in costs of utilities, consulting and amortisation and depreciation.

Adjusted EBITDA amounted to €13.5 million, with an AdjustedEBITDA margin accounting for 9.0% of sales, increasing by 0.5% from 8.5% recorded in first quarter 2022, due mainly to improved industrial margins, partly offset by higher operating expense.

Adjusted EBIT stood at 3.6% of revenue and amounted to €5.4 million (€4.5 million at March 31, 2022).

Net Financials closed with a negative €0.2 million, improving by €1.4 million versus March 31, 2022, as a result of favourable exchange rate differences in the current quarter.

Net profit for the period amounted to €3.2 million, accounting for 2.1% of revenue (€1.3 million at March 31, 2022 or 1.0% of revenue).

DIVISIONAL INCOME RESULTS FOR THE PERIOD

Operating segments are identified based on operating reports used at the highest decision-making level to allocate resources and assess results. The operating segments are shown below:

  • Datalogic represents the Group's core business and designs and produces barcode readers, mobile computers, detection, measurement and safety sensors, vision and laser marking systems and RFID that help increase the efficiency and quality of processes in the Retail, Manufacturing, Transportation & Logistics and Healthcare segments, along the entire value chain.
  • Informatics sells and distributes products and solutions for the management of inventories and mobile assets tailored to small and medium-sized companies.

The tables below show the comparison of Revenue and Adjusted EBITDA by Division in the period versus the same period of the prior year:

31.03.2023 % 31.03.2022 % Change % chg. % chg.
net FX
Datalogic 145,718 97.4% 134,045 97.2% 11,673 8.7% 7.5%
Informatics 4,098 2.7% 4,108 3.0% (10) -0.3% -3.8%
Intersegment adjustments (149) -0.1% (225) -0.2% 76
Total revenue 149,667 100.0% 137,928 100.0% 11,739 8.5% 7.2%

REVENUE BY DIVISION

ADJUSTED EBITDA BY DIVISION

31.03.2023 % on 31.03.2022 % on Change % chg.
Revenue Revenue
Datalogic 12,936 8.9% 11,002 8.2% 1,934 17.6%
Informatics 457 11.2% 802 19.5% (345) -43.0%
Intersegment adjustments 84 (52) 136
Total Adjusted EBITDA 13,477 9.0% 11,752 8.5% 1,725 14.7%

DATALOGIC DIVISION

At March 31, 2023, the Datalogicdivision recorded sales revenueof €145.7 million, up by 8.7% versus first quarter 2022.

The division's adjusted EBITDA came to €12.9 million, reaching 8.9% of sales (8.2% at March 31, 2022).

To better align with its strategic goals and prioritize product and solution offerings, Datalogic reviewed its operating model and introduced two new Market Segments, which operate with distinct sales models, and liaise with different representatives and purchasing needs of the client:Data Captureand Industrial Automation.

Reflecting the new operating model, the revenue breakdown for the Datalogic Division is now presented by the new segments, in place of the previous breakdown by Industries:

31.03.2023 % 31.03.2022 % Change % chg. % chg. net
FX
Data Capture 91,263 62.6% 83,462 62.3% 7,801 9.3% 7.7%
Industrial Automation 54,455 37.4% 50,583 37.7% 3,872 7.7% 7.1%
Total revenue 145,718 100.0% 134,045 100.0% 11,673 8.7% 7.5%

Data Capture

The Data Capture segment, with 62.6% of divisional sales (62.3% at March 31, 2022), was up by 9.3% versus first quarter 2022, driven by strong growth in EMEAI, while Americas was basically steady and APAC down.

Industrial Automation

The Industrial Automation segment grew by 7.7% in first quarter 2023, propelled by all the geographical areas.

INFORMATICS DIVISION

The Informatics Division achieved sales of €4.1 million in first quarter 2023, in line with sales in first quarter 2022.

The adjusted EBITDA margin in the first quarter of the year stood at 11.2%, deteriorating by 8.3% versus 19.5% in the first quarter of the prior year.

GROUP RECLASSIFIED STATEMENT OF FINANCIAL POSITION FOR THE PERIOD

31.03.2023 31.12.2022 Change % chg.
Intangible fixed assets 90,532 91,971 (1,439) -1.6%
Goodwill 208,689 212,043 (3,354) -1.6%
Tangible fixed assets 109,478 114,557 (5,079) -4.4%
Financial assets and investments in associates 9,412 8,679 733 8.4%
Other fixed assets 56,782 56,975 (193) -0.3%
Fixed Assets 474,893 484,225 (9,332) -1.9%
Trade receivables 73,141 91,299 (18,158) -19.9%
Trade payables (95,721) (112,054) 16,333 -14.6%
Inventory 127,092 129,824 (2,732) -2.1%
Net Trade Working Capital 104,512 109,069 (4,557) -4.2%
Other current assets 35,079 32,681 2,398 7.3%
Other current liabilities and provisions for risks (72,299) (71,605) (694) 1.0%
Net Working Capital 67,292 70,145 (2,853) -4.1%
Other non-current liabilities (48,710) (49,440) 730 -1.5%
Post-employment benefits (6,074) (6,163) 89 -1.4%
Provisions for non-current risks (5,303) (5,193) (110) 2.1%
Net Invested Capital 482,098 493,574 (11,476) -2.3%
Equity (450,425) (451,567) 1,142 -0.3%
Net financial position (NFP) (31,673) (42,007) 10,334 -24.6%

The following table shows the main financial and equity items at March 31, 2023 versus December 31, 2022.

Net Invested Capital, at €482.1 million (€493.6 million at December 31, 2022), shows an overall decrease of €11.5 million, of which €2.9 million in Net Working Capital and €9.3 million in Fixed Assets.

Fixed Assets, amounting to €474.9 million (€484.2 million at December 31, 2022), decreased by €9.3 million, attributable mainly to translation differences of €3.7 million (of which €3.4 million recognized on goodwill).

Net Trade Working Capital at March 31, 2023 amounted to €104.5 million and decreased by €4.6 million versus December 31, 2022, with the percentage of sales decreasing from 16.7% at December 31, 2022 to 15.7% at March 31, 2023. The change in the period is affected by a decrease in inventory of €2.7 million and a concurrent improvement in the balance between trade receivables and payables of €1.8 million.

The Net Financial Position at March 31, 2023 stood at a negative €31.7 million. The cash flows that led to the change in the consolidated Net Financial Position at December 31, 2022 are detailed below.

31.03.2023 31.03.2022 Change
Net financial position (Financial debt) beginning of period (42,007) (26,060) (15,947)
Adjusted EBITDA 13,478 11,752 1,726
Change in net trade working capital 4,557 (41,083) 45,640
Other changes in net working capital and special items (4,791) 1,161 (5,952)
Net expenditure (5,259) (4,030) (1,229)
Tax paid (829) (2,406) 1,577
Net financial income (expense) (179) (1,582) 1,403
Cash Flow from Operations 6,977 (36,189) 43,166
Acquisitions (16,000) 16,000
Other changes 3,357 586 2,772
Change in Net Financial Position 10,334 (51,603) 61,937
Net financial position (financial debt) end of period (31,673) (77,663) 45,990

Cash Flow from Operations at March 31, 2023 closed at a positive €7.0 million, increasing by €43.2 million versus a negative €36.2 million at March 31, 2022. The positive change is attributable to the cash generation of Net Working Capital in a quarter of the year, the first quarter, where cash is typically absorbed, and which in 2022 was also affected by supply chain challenges and delays in order fulfilment that had negatively impacted inventory and trade payables in particular.

At March 31, 2023, the Net Financial Debt is shown below:

31.03.2023 31.12.2022
A. Cash 84,138 107,469
B. Cash equivalents 13 13
C. Other current financial assets - -
D. Liquid assets (A) + (B) + (C) 84,151 107,482
E. Current financial debt 5,845 36,612
E1. of which lease payables 3,772 4,164
F. Current portion of non-current financial debt 34,071 33,810
G. Current Financial Debt (E) + (F) 39,916 70,422
H. Current Net Financial Debt (Financial Position) (G) -(D) (44,235) (37,060)
I. Non-current financial debt 75,908 79,067
I1. of which lease payables 8,899 11,962
J. Debt instruments - -
K. Trade and other non-current payables - -
L. Non-Current Financial Debt (I) + (J) + (K) 75,908 79,067
M. Total Net Financial Debt/(Net Financial Position) (H) + (L) 31,673 42,007

At March 31, 2023, the Group had outstanding financial credit lines of approximately €270.0 million, of which approximately €200.0 million committed. Undrawn and readily available financial lines amounted to €170.0 million.

Indirect and conditional debt at March 31, 2023 is represented exclusively by the Group's provision for postemployment benefits of €6.1 million.

SIGNIFICANT EVENTS DURING THE PERIOD

RECLASSIFICATION OF INCOME STATEMENT ITEMS

Starting from the first quarter of the current year, to provide a clearer picture of Group performance, certain costs related mainly to installations, previously shown in distribution expense, have been classified in cost of goods sold; additionally, certain quality-related expense has been itemized and allocated based on the intended purpose. Comparative figures have been consistently restated; reference is made to the table in Annex 4 of this document for details of the amounts.

GOVERNANCE

On April 27, 2023, the Shareholders' Meeting approved the financial statements at December 31, 2022, and reviewed the Group's consolidated financial statements at December 31, 2022, and resolved to distribute an ordinary unit dividend, gross of tax, of 30 Euro cents per share, for a maximum total amount of €17.0 million.

The same Meeting also resolved to:

  • set, pursuant to and for the purposes of Article 20 of the Bylaws, in the amount of €2.5 million, the maximum global annual compensation to begranted to all the members of the Board of Directors, including those holding strategic responsibilities for the current year (2023) and for the portion of the following year (2024), until the date of approval of the Company's 2023 financial statements, with the explicit exclusion of compensation plans based on financial instruments approved by the Shareholders' Meeting, leaving to the discretion of the Board itself any decision regarding the allocation of the above maximum global amount among the different Directors;
  • approve the 2023 remuneration policy set out in section one of the Report on the Remuneration Policy and on Compensation Paid and to vote in favour of compensation paid in 2022 set out in section two of the Report;
  • authorize the Board of Directors, pursuant to and in accordance with Article 2357 et seq. of the Italian Civil Code and Article 132 of LegislativeDecree no. 58 of February 24, 1998, to carry out transactions involving the purchase of the Company's treasury shares, on one or more occasions, within 18 months from the date of this resolution, concurrently revoking, for the portion unexecuted as of the date of the Shareholders' Meeting, the authorization to the Board of Directors to purchase the Company's treasury shares resolved by the Shareholders' Meeting on April 29, 2022.

RUSSIAN-UKRAINIAN CONFLICT

The socio-political tensions that escalated into a conflict between Russia and Ukraine on February 24, 2022, the developments of which are unpredictable to date, have led Western countries to impose economic sanctions on Russia. The Group has no offices in the countries currently directly affected by the conflict, nor do they represent significant outlet or supply markets for it. The ongoing conflict has triggered inflationary pressure, which has persisted since last year and into 2023, impacting mainly energy and certain commodity prices, and contributing to market volatility, leading to an increase in interest rates.

The potential effects of this situation on the Group's income and financial results are constantly monitored.

Since the outbreak of the conflict and the adoption of sanctions by the EU against Russia, a cross-functional working group has been established to assess and ascertain (including monitoring of "Denied Parties"), from a technical point of view, which Datalogic products and which business partner relationships could potentially be subject to sanctions. Following entry into force of the ninth European sanctions package, the Group companies have suspended all sales and post-sales activities with Russia (trade with Belarus had already been blocked) and implemented control systems in order to prevent business transactions with sanctioned countries.

SUBSEQUENT EVENTS

On April 3, 2023, a transaction was finalized to transfer to the Alstef Group the 15% stake in Solution Net Systems LLC (SNS) held by the subsidiary Datalogic USA Inc.

BUSINESS OUTLOOK

The macroeconomic outlook for 2023 is anticipated to be marked by ongoing uncertainty, as persistent inflationary pressure, restrictive monetary policies, and continued geopolitical tensions are expected to hinder both investment and consumption.

The Group's sales for the second quarter of the year are expected to decline versus the prior year, as a result of cautious policies and limited investment in the main market segments, reduced levels of inventory held by distribution channels, and normalised backlog levels, which are not as high as in previous quarters.

The short-term outlook for order entry remains negative, with increased uncertainty surrounding the potential for recovery in the second half of the year.

Nonetheless, the Group continues to put in place actions aimed at a steady recovery and improvement of operating margins and operating cash generation capacity, while continuing to maintain solid levels of investment in research and development.

SECONDARY LOCATIONS

The Parent Company has no secondary locations.

Chairman of the Board of Directors (Romano Volta)

Consolidated Financial Statements

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

ASSETS (Euro/000) Notes 31.03.2023 31.12.2022
A) Non-current assets (1+2+3+4+5+6+7) 474,893 484,225
1) Tangible fixed assets 97,042 98,799
Land 1 12,668 12,740
Buildings 1 52,149 52,449
Other assets 1 27,548 29,825
Fixed assets under construction and advances 1 4,677 3,785
2) Intangible fixed assets 299,221 304,014
Goodwill 2 208,689 212,043
Development costs 2 39,218 27,209
Other 2 41,306 43,206
Fixed assets under construction and advances 2 10,008 21,556
3) Right of use fixed assets 3 12,436 15,758
4) Investments in associates 4 560 560
5) Non-current financial assets 6 8,852 8,119
6) Trade and other receivables 7 769 768
7) Deferred tax assets 12 56,013 56,207
B) Current assets (8+9+10+11+12) 319,463 361,286
8) Inventory 127,092 129,824
Raw and ancillary materials and consumables 8 61,465 62,503
Work in progress and semi-finished products 8 24,621 25,864
Finished products and goods 8 41,006 41,457
9) Trade and other receivables 95,800 109,845
Trade receivables 7 73,141 91,299
of which associates 7 2,555 2,861
of which related parties 7 11 11
Other receivables, accrued income and prepaid expense 7 22,659 18,546
10) Tax receivables 9 12,420 14,135
of which Parent Company 1,807 1,807
11) Current financial receivables - -
12) Cash and cash equivalents 5 84,151 107,482
Total Assets (A+B) 794,356 845,511

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

LIABILITIES (Euro/000) Notes 31.03.2023 31.12.2022
A) Total Equity (1+2+3+4+5+6) 10 450,425 451,567
1) Share capital 10 30,392 30,392
2) Reserves 10 127,874 132,266
3) Retained earnings (losses) 10 285,509 255,840
4) Profit (loss) for the period 10 3,327 29,550
5) Group Equity 10 447,102 448,048
Profit (loss) for the period attributable to non-controlling interests 10 (144) 576
Share capital attributable to non-controlling interests 10 3,467 2,943
6) Equity attributable to non-controlling interests 3,323 3,519
B) Non-current liabilities (7+8+9+10+11+12) 135,995 139,863
7) Non-current financial payables 11 75,908 79,067
8) Tax payables - -
9) Deferred tax liabilities 12 28,570 28,680
10) Provisions for post-employment and retirement benefits 13 6,074 6,163
11) Provisions for non-current risks and charges 14 5,303 5,193
12) Other liabilities 15 20,140 20,760
C) Current liabilities (13+14+15+16) 207,936 254,081
13) Trade and other payables 152,488 166,713
Trade payables 15 95,721 112,054
of which associates 15 60 101
of which related parties 39 24
Other payables, accrued expense and deferred income 15 56,767 54,659
14) Tax payables 9 12,563 13,478
of which Parent Company 2,013 2,013
15) Provisions for current risks and charges 14 2,969 3,468
16) Current financial payables 11 39,916 70,422
Total Liabilities (A+B+C) 794,356 845,511

CONSOLIDATED INCOME STATEMENT

31.03.2023 31.03.2022
(Euro/000) Notes Restated
1) Revenue 16 149,667 137,928
Revenue from sale of products 139,093 127,891
Revenue from services 10,574 10,037
of which related parties and associates 2,720 2,514
2) Cost of goods sold 17 87,274 82,564
of which related parties and associates 78 80
Gross Operating Margin (1-2) 62,393 55,364
3) Other revenue 18 578 204
4) Research and development expense 17 17,207 14,268
of which related parties and associates 148 138
5) Distribution expense 17 26,856 23,369
of which related parties and associates 54 47
6) Administrative and general expense 17 14,403 15,191
of which related parties and associates 41 140
of which Parent Company 6 -
7) Other operating expense 17 583 461
Total operating costs 59,049 53,290
EBIT 3,922 2,278
8) Financial income 19 9,669 5,246
9) Financial expense 19 9,847 6,828
Net Financials (8-9) (178) (1,582)
Profit/(Loss) before tax from continuing operations 3,744 696
Income tax 20 562 (633)
Profit/(Loss) for the period 3,182 1,329
Basic earnings/(loss) per share (€) 22 0.06 0.02
Diluted earnings/(loss) per share (€) 22 0.06 0.02
Attributable to:
Shareholders of the Parent Company 3,326 1,370
Non-controlling interests (144) (41)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Euro/000) Notes 31.03.2023 31.03.2022
Profit/(Loss) for the period 3,182 1,329
Other items of the statement of comprehensive income:
Other items of the statement of comprehensive income that will later be
reclassified to Profit/(Loss) for the period:
Profit/(Loss) on cash flow hedges (CFH) 10 25 27
Profit (loss) from the translation of financial statements of foreign companies 10 (6,378) 6,377
Total other items of the statement of comprehensive income that will later be
reclassified to Profit/(Loss) for the period
(6,353) 6,404
Other items of the statement of comprehensive income that will not later be
reclassified to Profit/(Loss) for the period
Actuarial gains (losses) on defined-benefit plans
of which tax effect
Profit/(Loss) from financial assets at FVOCI 10 1,695 (868)
of which tax effect (21) 10
Total other items of the statement of comprehensive income that will not later
be reclassified to Profit/(Loss) for the period
1,695 (868)
Total profit/(loss) of the statement of comprehensive income (4,658) 5,537
Comprehensive profit/(loss) for the period (1,476) 6,866
Attributable to:
Shareholders of the Parent Company (1,281) 6,907
Non-controlling interests (195) (41)

CONSOLIDATED STATEMENT OF CASH FLOWS

(Euro/000) Notes 31.03.2023 31.03.2022
Profit/(Loss) before tax 3,744 696
Depreciation of tangible fixed assets and write-downs 1 3,082 3,334
Amortisation of intangible fixed assets and write-downs 2 5,168 4,306
Depreciation of Right of use fixed assets 3 1,045 1,086
Losses (Gains) from sale of fixed assets 17, 18 (24) (8)
Change in provisions for risks and charges 14 (389) (282)
Change in provision for obsolescence 8 2,035 -
Net Financials 19 179 1,582
Monetary effect foreign exchange gains/(losses) (1,739) -
Other non-monetary changes (881) 680
Cash flow generated (absorbed) from operations before changes in 12,220 11,394
working capital
Change in trade receivables 7 17,393 2,820
Change in final inventory 8 403 (20,048)
Change in trade payables 15 (15,875) (23,850)
Change in other current assets 7 (4,217) (2,465)
Change in other current liabilities 15 2,480 4,713
Change in other non-current assets 6 (5) 31
Change in other non-current liabilities 5 (447) (29)
Cash flow generated (absorbed) from operations after changes in
working capital
11,952 (27,435)
Change in tax assets and liabilities 425 (2,396)
Interest paid (901) (671)
Interest collected 111 27
Cash flow generated (absorbed) from operations (A) 11,587 (30,475)
Increase in intangible fixed assets 2 (3,613) (3,343)
Decrease in intangible fixed assets 2 - 13
Increase in tangible fixed assets 1 (1,722) (1,301)
Decrease in tangible fixed assets 1 76 15
Cash flow from business combinations, net of cash acquired - (16,000)
Change in investments and current and non-current financial assets 5 (97) 21
Cash flow generated (absorbed) from investments (B) (5,356) (20,595)
Payment of financial payables 11 (30,084) (13,743)
New financial payables 11 - 35,000
Other changes in financial payables 11 (19) (282)
Payments of financial liabilities from leases (1,113) (493)
Effect of change in cash and cash funds (375) 742
Other changes 2,030 -
Cash flow generated (absorbed) from financing activities (C) (29,562) 21,224
Net increase (decrease) in cash funds (A+B+C) (23,331) (29,846)
Net cash and cash equivalents at beginning of period 107,482 106,080
Net cash and cash equivalents at end of period 84,151 76,235

CONSOLIDATED CHANGES IN EQUITY

Share Share Treasury Translation Other Retained Group Group Profit Share Equity Profit Equity
capital premium
res.
shares reserve Reserves earnings Profit
(Loss)
Equity (Loss)
of non
capital and
reserves
attributable
to non
(Loss)
Description controlling attributable controlling
interests to non interests
controlling
interests
01.01.2023 30,392 111,779 (22,191) 39,331 3,347 255,839 29,551 448,048 576 2,942 3,519 30,127 451,569
Allocation of profit - - - - - 29,551 (29,551) - (576) 576 - (30,127) -
Dividends - - - - - - - - - - - - -
Treasury shares - - - - - - - - - - - - -
Share-based incentive plan - - - - 216 - - 216 - - - - 216
Other changes - - - - - 119 - 119 - - - - 119
Profit/(Loss) for the period - - - - - - 3,327 3,327 (144) - (144) 3,182 3,182
Other items of the statement of - - - (6,328) 1,720 - - (4,608) (51) (51) - (4,658)
comprehensive income
Total comprehensive Profit (Loss) - - - (6,328) 1,720 - 3,327 (1,281) (144) (51) (195) 3,182 (1,476)
31.03.2023 30,392 111,779 (22,191) 33,003 5,283 285,509 3,327 447,102 (144) 3,468 3,323 3,182 450,425
Share Share Treasury Translation Other Retained Group Group Profit Share Equity Profit Equity
capital premium shares reserve Reserves earnings Profit Equity (Loss) capital and attributable (Loss)
res. (Loss) of non reserves to non
Description controlling attributable controlling
interests to non interests
controlling
interests
01.01.2022 30,392 111,779 (26,096) 22,746 11,239 229,692 38,913 418,665 627 2,432 3,060 39,540 421,724
01.01.2022 30,392 111,779 (26,096) 22,746 11,239 229,692 38,913 418,665 627 2,432 3,060 39,540 421,724
Allocation of profit - - - - - 38,912 (38,912) - (627) 627 - (39,540) -
Dividends - - - - - - - - - - -
-
-
Treasury shares - - - - - - - - - - -
-
-
Share-based incentive plan - - - - - - - - - - -
-
-
Other changes - - - - - (226) - (226) - (42) (42) - (268)
Profit/(Loss) for the period - - - - - - 1,370 1,370 (41) (41) 1,329 1,329
Other items of the statement of
comprehensive income - - - 6,313 (841) - - 5,472 65 65 - 5,537
Total comprehensive Profit (Loss) - - - 6,313 (841) - 1,370 6,842 (41) 65 24 1,329 6,866
31.03.2022 30,392 111,779 (26,096) 29,059 10,398 268,378 1,370 425,281 (41) 3,082 3,041 1,329 428,322

Explanatory Notes

EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

GENERAL INFORMATION

Datalogic is a global technological leader in the automatic data capture and process automation markets. The Company is specialised in the design and production of barcode readers, mobile computers, detection, measurement and safety sensors, vision and laser marking systems and RFID.

Its pioneering solutions help increase efficiency and quality of processes in the areas of Retail, Manufacturing, Transportation & Logistics, and Healthcare, along the entire value chain.

Datalogic S.p.A. (hereinafter "Datalogic", the "Parent Company" or the "Company") is a joint-stock company listed on Euronext STAR Milan of Borsa Italiana S.p.A. and is headquartered in Italy. The registered office is in Via Candini 2, Lippo di Calderara (BO).

This Consolidated Interim Reportfor the period ended March 31, 2023 includes the figures of the Parent Company and its subsidiaries (hereinafter referred to as the "Group") and the relevant shares in associates.

The publication of this Consolidated Interim Report for the period ended March 31, 2023 of the Datalogic Group was authorized by resolution of the Board of Directors on May 11, 2023.

BASIS OF PRESENTATION

1) General criteria

This Consolidated Interim Reportwas prepared pursuant to Article 154-ter D. Legislative Decree no. 58 of February 24, 1998 (TUF) as subsequently amended and supplemented, as well as to the CONSOB Issuer Regulation. The criteria for the preparation of the Statement are in accordance with the requirements of IAS 34 "Interim Financial Reporting", providing the summary information notes required by the above standard, supplemented if the case to provide a greater level of information where deemed necessary.

This Consolidated Interim Reportshould therefore be read in conjunction with the Consolidated Annual Financial Report at December 31, 2022, prepared in accordance with IFRS accounting standards adopted by the European Union, approved by the Board of Directors on March 9, 2023, and available in the Investor Relations section of the Group's website (www.datalogic.com).

This Consolidated Interim Report is prepared in Euro thousands, which is the Group's functional and presentation currency.

2) Reporting formats

The reporting formats adopted are compliant with those required by IAS 1 and were used in the Consolidated Annual Financial Report for the year ended December 31, 2022, in particular:

  • current and non-current assets, as well as current and non-current liabilities are shown separately in the Statement of Financial Position. Current assets, which include cash and cash equivalents, are those intended

to be realized, sold or consumed in the Group's normal operating cycle; current liabilities are those expected to be settled in the Group's normal operating cycle or in the twelve months following the end of the period;

  • with regard to the Income Statement, cost and revenue items are shown based on grouping by function, as this classification was deemed more explanatory for understanding the Group's results of operations;
  • the Statement of Comprehensive Income shows the items that determine profit/(loss) for the period, considering income and expense recognised directly in equity;
  • the Statement of Cash Flows is presented using the "indirect method".

3) Use of estimates and assumptions

The preparation of the IFRS-compliant Consolidated Interim Report requires Directors to apply accounting standards and methodologies that, in some cases, are based on valuations and estimates, which in turn refer to historic experience and assumptions based on specific circumstances at any given time. The application of these estimates and assumptions affects the amounts of revenue, expense, assets and liabilities and their disclosure, as well as the disclosure of contingent liabilities. The actual amounts of accounting items, for which these estimates and assumptions have been used, might be different from those reported due to the uncertainty characterising the assumptions and conditions on which estimates are based.

4) Consolidation scope

This Consolidated Interim Report at March 31, 2023 includes the income statement and balance sheet data of Datalogic S.p.A. and all the companies that it directly or indirectly controls.

The list of investments included in the consolidation scope appears in Annex 2 of the Explanatory Notes, with an indication of the methodology used.

5) Translation criteria of foreign currency financial statements

The exchange rates used to determine the value in Euro of financial statements denominated in foreign currency of subsidiaries (currency for 1 Euro) are shown hereunder:

Currency (ISO Code) Quantity of currency for 1 Euro
March 2023 March 2023 December 2022 March 2022
Final exchange Average Final exchange Average
rate exchange rate rate exchange rate
for the period for the period
US Dollar (USD) 1.09 1.07 1.07 1.12
British Pound Sterling (GBP) 0.88 0.88 0.89 0.84
Swedish Krona (SEK) 11.28 11.20 11.12 10.48
Singapore Dollar (SGD) 1.45 1.43 1.43 1.52
Japanese Yen (JPY) 144.83 141.98 140.66 130.46
Australian Dollar (AUD) 1.63 1.57 1.57 1.55
Hong Kong Dollar (HKD) 8.54 8.41 8.32 8.76
Chinese Renminbi (CNY) 7.48 7.34 7.36 7.12
Brazilian Real (BRL) 5.52 5.58 5.64 5.87
Mexican Peso (MXN) 19.64 20.04 20.86 22.99
Hungarian Forint (HUF) 379.50 388.71 400.87 364.60
Czech Crown (CZK) 23.49 23.79 24.12 24.65

SEGMENT DISCLOSURE

Operating segments are identified based on operating reports used at the highest decision-making level to allocate resources and assess results. Transfers amongst the operating segments indicated hereunder are executed at arm's length conditions, based on the Group transfer pricing policies. For first quarter 2023, the operating segments are identified as follows:

  • Datalogic, the Group's core business, designs and produces barcode readers, mobile computers, detection, measurement and safety sensors, visionand laser marking systems and RFID that help increase the efficiency and quality of processes in the Data Capture and Industrial Automationareas in which it operates.
  • Informatics sells and distributes products and solutions for the management of inventories and mobile assets tailored to small and medium-sized companies.

The income information related to operating segments at March 31, 2023 and March 31, 2022 is the following:

Datalogic Informatics Adjustments Total Group
Divisional income position Business 31.03.2023
Revenue 145,718 4,098 (149) 149,667
Adjusted EBITDA 12,936 457 84 13,477
% Revenue 8.88% 11.15% 9.00%
EBIT 3,433 406 83 3,922
Divisional income position Datalogic
Business
Informatics Adjustments Total Group
31.03.2022
Revenue 134,045 4,108 (225) 137,928
Adjusted EBITDA 11,002 802 (52) 11,752
% Revenue 8.21% 19.52% 8.52%
EBIT 1,654 677 (53) 2,278

The equity information related to operating segments at March 31, 2023 and at December 31, 2022 is the following.

Divisional financial position Datalogic
Business
Informatics Adjustments Total Group
31.03.2023
Total Assets 798,183 27,296 (31,123) 794,356
Total Liabilities 342,472 7,615 (6,156) 343,931
Equity 455,711 19,681 (24,967) 450,425
Divisional financial position Datalogic
Business
Informatics Adjustments Total Group
31.12.2022
Total Assets 848,979 28,416 (31,884) 845,511
Total Liabilities 392,016 8,666 (6,738) 393,944
Equity 456,963 19,750 (25,146) 451,567

INFORMATION ON THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

ASSETS

Note 1. Tangible fixed assets

Tangible fixed assets at March 31, 2023 amounted to €97,042 thousand. During the period, net expenditure of €1,670 thousand and depreciation of €3,082 thousand was recognised, while exchange rate effects closed with a negative €346 thousand. The breakdown of the item at March 31, 2023 and at December 31, 2022 is shown below.

31.03.2023 31.12.2022 Change
Land 12,668 12,740 (72)
Buildings 52,149 52,449 (300)
Other assets 27,548 29,825 (2,277)
Fixed assets under construction and advances 4,677 3,785 892
Total 97,042 98,799 (1,757)

The "Other assets" item at March 31, 2023 includes the following categories: industrial equipment and moulds (€10,981 thousand), plant and machinery (€7,031 thousand), office furniture and machines (€5,611 thousand), generic plant related to buildings (€2,509 thousand), lightweight constructions (€301 thousand), commercial equipment and demo rooms(€605 thousand), leasehold improvements (€406 thousand), and motor vehicles (€105 thousand).

The balance of "Fixed assets under construction and advances", equal to €4,677 thousand, is composed primarily of moulds under construction and equipment and production lines built in house, and of improvements to owned buildings.

Note 2. Intangible fixed assets

Intangible fixed assets at March 31, 2023 amounted to €299,221 thousand. During the period, net expenditure of €3,613 thousand and amortisation of €5,168 thousand was recognised, while exchange rate effects closed with a negative €3,238 thousand. The breakdown of the item at March 31, 2023 and at December 31, 2022 is shown below:

31.03.2023 31.12.2022 Change
Goodwill 208,689 212,043 (3,354)
Development costs 39,218 27,209 12,009
Other 41,306 43,206 (1,900)
Fixed assets under construction and advances 10,008 21,556 (11,548)
Total 299,221 304,014 (4,793)

Goodwill

"Goodwill", equal to €208,689 thousand, is allocated to the CGUs identified by Management as shown below.

31.03.2023 31.12.2022 Change
Datalogic CGU 194,852 197,989 (3,137)
Informatics CGU 13,837 14,054 (217)
Total 208,689 212,043 (3,354)

The change from the end of the prior year is attributable to translation differences.

Goodwill is allocated to the CGUs (Cash Generating Units)represented by the individual companies and/or sub-groups to which they refer.

The estimated recoverable value of each CGU, associated with each Goodwill item measured, consists of its corresponding value in use. Value in use was calculated by discounting at a given discount rate the future cash flows expected to be generated by the CGU, in the production phase and at the time of its disposal, based on the Discounted Cash Flow method.

The cash flows of the individual CGUs are estimated based on forward-looking plans prepared by Management. These plans represent the best estimate of the foreseeable outlook, based on the business strategies and growth indicators of the relevant industry and markets.

The assumptions used for the purposes of impairment were approved by the Board of Directors and the Control, Risks, Remuneration and Appointments Committee of Datalogic S.p.A. on February 2, 2023.

Development costs, Other intangible fixed assets and Fixed assets under construction and advances

"Development costs", amounting to €39,218 thousand at March 31, 2023, consists of product development projects.

"Other", amounting to €41,306 thousand, consists primarily of intangible assets acquired through business combinations carried out by the Group, and software licences as detailed below:

31.03.2023 31.12.2022 Change
Patents 5,137 5,710 (573)
Know-how 14,498 14,483 15
Customer portfolio 11,618 11,842 (225)
Licences 1,479 1,662 (183)
Software 8,574 9,508 (934)
Total 41,306 43,206 (1,900)

"Fixed assets under construction and advances", amounting to €10,008 thousand (€21,556 thousand at December 31, 2022), is attributable mainly to the capitalization of costs for product development projects currently under way.

Note 3. Right of use fixed assets

Net negative changes of €2,243 thousand were recorded during the period and depreciation of €1,045 thousand, while exchange rate effects closed with a negative €34 thousand. The breakdown of the item at March 31, 2023 and at December 31, 2022 is shown below.

31.03.2023 31.12.2022 Change
Buildings 10,338 13,590 (3,252)
Vehicles 1,949 1,997 (48)
Office equipment 149 171 (22)
Total 12,436 15,758 (3,322)

Note 4. Investments in associates

The non-controlling investments held by the Group, details of which are found in Annex 2, at March 31, 2023 amounted to €560 thousand, unchanged versus the prior period.

Note 5. Financial assets and liabilities by category

The table below provides a breakdown of "Financial assets and liabilities" under IFRS 9.

Financial assets

Financial
assets at
amortized
cost
Financial
assets at FV
through profit
and loss
Financial
assets at FV
through OCI
31.03.2023
Non-current financial assets 769 3,943 4,909 9,621
Non-current financial assets and investments - 3,943 4,909 8,852
Other receivables 769 - - 769
Current financial assets 179,951 - - 179,951
Trade receivables 73,141 - - 73,141
Other receivables 22,659 - - 22,659
Financial assets - Loans - - - -
Cash and cash equivalents 84,151 - - 84,151
Total 180,720 3,943 4,909 189,572
Financial
assets at
amortized cost
Financial assets
at FV through
profit and loss
Financial assets
at FV through
OCI
31.12.2022
Non-current financial assets 768 3,818 4,301 8,887
Non-current financial assets and investments - 3,818 4,301 8,119
Other receivables 768 - - 768
Current financial assets 217,327 - - 217,327
Trade receivables 91,299 - - 91,299
Other receivables 18,546 - - 18,546
Financial assets - Loans - - - -
Cash and cash equivalents 107,482 - - 107,482
Total 218,095 3,818 4,301 226,214

"Cash and cash equivalents" amounted to €84,151 thousand. Details are found in the Net Financial Debt schedule in the Directors' Report on Operations.

Financial liabilities

Derivatives Financial liabilities at
amortized cost
31.03.2023
Non-current financial liabilities - 96,048 96,048
Financial payables - 75,908 75,908
Other payables - 20,140 20,140
Current financial liabilities - 192,404 192,404
Trade payables - 95,721 95,721
Other payables - 56,767 56,767
Current financial payables - 39,916 39,916
Total - 288,452 288,452
Derivatives Financial liabilities at
amortized cost
31.12.2022
Non-current financial liabilities - 99,827 99,827
Financial payables - 79,067 79,067
Other payables - 20,760 20,760
Current financial liabilities - 237,135 237,135
Trade payables - 112,054 112,054
Other payables - 54,659 54,659
Current financial payables - 70,422 70,422
Total - 336,962 336,962

The fair value of financial assets and financial liabilities is determined according to methods classifiable in the various levels of the fair value hierarchy as envisaged by IFRS 13. Specifically, the Group uses internal valuation models generally used in financial practice, based on prices provided by market participants or quotations recorded on active markets.

Fair value - hierarchy

All the financial instruments measured at fair value are classified in the three categories shown below:

Level 1: market prices;

Level 2: valuation techniques (based on observable market data);

Level 3: valuation techniques (not based on observable market data).

Assets measured at fair value Level 1 Level 2 Level 3 31.03.2023
Non-current financial assets and investments 4,909 - 3,943 8,852
Total 4,909 - 3,943 8,852

Note 6. Financial assets and current financial receivables

Financial assets include the following:

31.03.2023 31.12.2022 Change
Non-current financial assets 8,852 8,119 733
Current financial assets - - -
Total 8,852 8,119 733

Non-current financial assets amounted to €8,852 thousand and consisted of 4,870 thousand from the investment in the capital of the Japanese company Idec Corporation, €2,207 thousand from the investment in a financial instrument convertible into capital issued by AWM Smart Shelf, investment funds amounting to €1,512 thousand and investments in capital instruments in other companies amounting to €265 thousand. The change in the year is attributable mainly to the recognition of the fair value of these financial instruments.

Note 7. Trade and other receivables

31.03.2023 31.12.2022 Change
66,584 84,880 (18,296)
6,857 6,385 472
(2,866) (2,838) (28)
70,575 88,427 (17,852)
2,555 2,861 (306)
11 11 -
73,141 91,299 (18,158)
22,659 18,546 4,113
769 768 1
23,428 19,314 4,114
769 768 1
95,800 109,845 (14,045)

The breakdown of the item at March 31, 2023 and at December 31, 2022 is shown below:

Trade receivables

"Trade receivables" amounted to €73,141 thousand at March 31, 2023, down by €18,158 thousand versus December 31, 2022. At March 31, 2023, trade receivables factored without recourse amounted to 30,314 thousand (€29,877 thousand at December 31, 2022). Trade receivables from associates arise from commercial transactions carried out at normal market conditions.

Other receivables - accrued income and prepaid expense

The details of "Other receivables - accrued income and prepaid expense" are shown below.

31.03.2023 31.12.2022 Change
Other current receivables 3,224 1,639 1,585
Other non-current receivables 769 768 1
VAT receivables 15,168 12,972 2,196
Accrued income and prepaid expense 4,267 3,935 332
Total 23,428 19,314 4,114

The "VAT receivable" of €15,168 thousand refers to normal commercial transactions. The increase is a result of the higher volume of exports in the period.

"Accrued income and prepaid expense" consists mainly of the recognition of insurance contracts and hardware and software licenses, the change in the period is attributable to contract renewals of license contracts; the figure is in line with the same period of the prior year (€4,388 thousand at March 31, 2022).

Note 8. Inventory

Inventory amounted to €127,092 thousand, down by €2,732 thousand during the period.

31.03.2023 31.12.2022 Change
Raw and ancillary materials and consumables 61,465 62,503 (1,038)
Work in progress and semi-finished products 24,621 25,864 (1,243)
Finished products and goods 41,006 41,457 (451)
Total 127,092 129,824 (2,732)

Inventory is shown net of an obsolescence provision totalling €14,424 thousand at March 31, 2023 (€12,387 thousand at December 31, 2022).

Note 9. Tax receivables and payables

31.03.2023 31.12.2022 Change
Tax receivables 12,420 14,135 (1,715)
of which Parent Company 1,807 1,807 -
Tax payables (12,563) (13,478) 915
of which Parent Company (2,013) (2,013) -
Total (143) 657 (800)

At March 31, 2023, the net balance of "Tax Receivables and Payables" was negative and equal to €143 thousand versus a positive 657 thousand at December 31, 2022, marking a negative change of €800 thousand. The change in the period is due mainly to the payment of tax advances.

LIABILITIES AND EQUITY

Note 10. Equity

The composition of Equity at March 31, 2023 is shown below.

31.03.2023 31.12.2022 Change
Share capital 30,392 30,392 -
Share premium reserve 111,779 111,779 -
Treasury shares held in portfolio (22,191) (22,191) -
Share capital and reserves 119,980 119,980 -
Translation reserve 33,003 39,331 (6,328)
Other reserves 5,283 3,347 1,936
Retained earnings 285,509 255,840 29,669
Profit for the period 3,327 29,550 (26,223)
Total Group equity 447,102 448,048 (946)
Profit (loss) for the period attributable to non-controlling interests (144) 576 (720)
Share capital attributable to non-controlling interests 3,467 2,943 524
Total consolidated equity 450,425 451,567 (1,142)

Share capital

At March 31, 2023, the share capital of €30,392 thousand represents the fully subscribed and paid-up share capital of the Parent Company Datalogic S.p.A.. It comprises ordinary shares for a total of 58,446,491, of which 1,667,053 held as treasury shares for a value of €22,191 thousand, therefore the outstanding shares at that date amounted to 56,779,438.

Other Reserves

At March 31, 2023, there was no change in the "Reserve for treasury shares held in portfolio".

The "Translation Reserve" shows a declining change of €6,328 thousand in the reporting period, due in particular to the effects of the performance of the U.S. dollar, the functional currency of a number of the Group's major investees.

With regard to the change in the "Share-based incentive plan reserve", it should be noted that said change refers to the allocation for the period for the Performance Shares Plan 2022-2024approved by the Shareholders' Meeting on April 29, 2022.

At March 31, 2023, "Other reserves", including the "Share-based incentive plan reserve", amounted to €5,283 thousand (€3,347 thousand at December 31, 2022). The increase is related mainly to the provision for the period of €216 thousand and the fair value adjustment of financial assets for the year of €1,695 thousand.

Note 11. Financial payables

"Financial payables" at March 31, 2023 amounted to €115,824 thousand, decreasing by €33,665 thousand as detailed below.

31.03.2023 31.12.2022 Change
Bank loans 101,080 130,915 (29,835)
Financial payables from leases 12,671 16,126 (3,455)
Payables to factoring companies 1,978 2,229 (251)
Other financial payables - 53 (53)
Bank overdrafts 95 166 (71)
Total 115,824 149,489 (33,665)

The change in "Bank loans" for the period is a result of instalmentsfalling due and the repayment of credit lines totalling €30,084 thousand. The movements are shown below:

2023 2022
At January 1 130,915 113,206
Increases - 35,000
Change in consolidation scope - -
Decreases for borrowing repayments (30,084) (10,126)
Other changes 249 282
At March 31 101,080 138,362

"Financial payables from leases" decreased by €3,455 thousand.

The breakdown of financial payables, divided into current and non-current portions, is shown below:

31.03.2023 31.12.2022 Change
Non-current financial payables 75,908 79,067 (3,159)
Current financial payables 39,916 70,422 (30,506)
Total 115,824 149,489 (33,665)

At March 31, 2023, the Group had credit lines in place for a total of €270.0 million, of which €170.0 million undrawn, including €100.0 million long-term and €70.0 million short-term.

Covenants

Certain loan agreements require the Group to comply with financial covenants, measured on a half-year basis at June 30 and December 31, summarized in the following table:

Loan Company Covenants Frequency Reference financial
statements
Club Deal Datalogic S.p.A. NFP/EBITDA 2.75 Half-year Consolidated
RCF Datalogic S.p.A. NFP/EBITDA 2.75 Half-year Consolidated
Roller Coaster Datalogic S.p.A. NFP/EBITDA 3.00 Half-year Consolidated

AtDecember 31, 2022, all covenants were met.

Note 12. Net deferred tax

Deferred tax assets and deferred tax liabilities result both from positive items already recognised in the income statement and subject to deferred taxation under current tax regulations and temporary differences between recorded assets and liabilities and their relevant taxable value.

Deferred tax assets are accounted for in accordance with the assumptions of future recoverability of the temporary differences they originated from, i.e., on the basis of strategic economic and tax plans.

Temporary differences generating deferred tax assets consist mainly of tax losses and tax paid abroad, provisions for risks and charges, and foreign exchange adjustments. Deferred tax liabilities are attributable mainly to temporary differences in exchange rate adjustments and statutory and tax differences in the amortisation/depreciation schedules of tangible and intangible fixed assets and fair value measurements of assets as part of business combinations carried out by the Group.

31.03.2023 31.12.2022 Change
Deferred tax assets 56,013 56,207 (194)
Deferred tax liabilities (28,570) (28,680) 110
Net deferred tax 27,443 27,527 (84)

Deferred tax assets amounted to €56,013 thousand and included Foreign tax credits attributable mainly to the subsidiary Datalogic USA Inc.

Deferred tax liabilities at March 31, 2023 amounted to €28,570 thousand and refer mainly to temporary differences related to asset amortisation/depreciation schedules, as well as tax adjustments resulting from the consolidation processes of recent acquisitions made by the Group.

Note 13. Provisions for post-employment and retirement benefits

The breakdown of changes in "Provisions for post-employment and retirement benefits" at March 31, 2023 and at March 31, 2022 is shown below:

2023 2022
At January 1 6,163 7,088
Amount allocated in the period 756 857
Utilizations (631) (725)
Receivable from INPS (208) (304)
Other movements - (7)
Exchange rate adjustments (6) -
At March 31 6,074 6,909

Note 14. Provisions for risks and charges

"Provisions for risks and charges" at March 31, 2023, amounted to €8,272 thousand (€8,661 thousand at December 31, 2022), represented by the best estimate of the contingent liabilities to which the Group is exposed in relation to contractual obligations for product warranties and long-term incentive and retention plans for personnel (middle management and key people), as well as contingent liabilities of a tax, labour law and supplementary agents' indemnity nature, as shown below.

31.12.2022 Increases (Utilizations) Exchange 31.03.2023
and differences
(Releases)
Product warranty provision 7,169 - (401) (1) 6,767
Provision for staff incentive and retention plans 531 305 (8) 828
Other provisions 961 - (285) 1 677
Total 8,661 305 (686) (8) 8,272

The "Product warranty provision" covers the estimated cost of repairing products sold up to March 31, 2023 and covered by a warranty period; said provision amounted to €6,767 thousand (of which €4,034 thousand long-term).

"Provision for staff incentive and retention plans" refers to the estimated bonuses to be paid to staff based on longterm incentive and retention plans set aside during the period.

"Other provisions" at March 31, 2023 amounted to €677 thousand and consisted mainly of provisions for supplementary agent's indemnity and for contingent liabilities of a fiscal and labour law nature.

The breakdown of provisions for risks, divided into current and non-current portions, is shown below:

31.03.2023 31.12.2022 Change
Provisions for risks and charges, current portion 2,969 3,468 (499)
Provisions for risks and charges, non-current portion 5,303 5,193 110
Total 8,272 8,661 (389)

Note 15. Trade and other payables, accrued expense and deferred income

31.03.2023 31.12.2022 Change
Trade payables 92,206 108,363 (16,157)
Contractual liabilities - customer advances 3,416 3,566 (150)
Trade payables 95,622 111,929 (16,307)
Payables to associates 60 101 (41)
Payables to related parties 39 24 15
Total trade payables 95,721 112,054 (16,333)
Other current payables 35,926 33,603 2,323
Current accrued expense and deferred income 20,841 21,056 (215)
Non-current accrued expense and deferred income 20,140 20,760 (620)
Total Other payables - accrued expense and deferred income 76,907 75,419 1,488
Less: non-current portion 20,140 20,760 (620)
Current portion 152,488 166,713 (14,225)

Trade payables

"Trade payables" amounted to €95,721 thousand, down by €16,333 thousand versus the end of the prior year.

Other current payables

31.03.2023 31.12.2022 Change
Payables to employees 22,990 21,078 1,912
Payables to welfare and social security entities 6,645 7,130 (485)
Other payables 3,230 2,850 380
VAT payables 3,061 2,545 516
Total 35,926 33,603 2,323

"Other current payables" amounting to €35,926 thousand at March 31, 2023, consists mainly of "Payables to employees" for the fixed and variable components of salaries and holiday entitlements, as well as the related "Payables to welfare and social security entities".

Accrued expense and deferred income

"Accrued expense and deferred income", amounting to €40,981 thousand at March 31, 2023 (€41,816 thousand at December 31, 2022), is composed mainly of deferred revenue related to the Ease of Care long-term maintenance contracts.

INFORMATION ON THE INCOME STATEMENT

Note 16. Revenue

Revenue classified by type is shown in the following table:

31.03.2023 31.03.2022 Change
Revenue from sale of products 139,093 127,891 11,202
Revenue from services 10,574 10,037 537
Total revenue 149,667 137,928 11,739

At March 31, 2023, consolidated net revenue amounted to €149,667 thousand, up by 8.5% versus €137,928 thousand in the same period of 2022. The Group's revenue, classified by recognition method and business segment, is broken down as follows:

Revenue broken down by recognition method Datalogic Informatics Adjustments 31.03.2023
Revenue from sale of goods and services - point in time 132,283 2,204 (149) 134,339
Revenue from sale of goods and services - over the
time 13,435 1,894 - 15,328
Total 145,718 4,098 (149) 149,667
Revenue broken down by recognition method Datalogic Informatics Adjustments 31.03.2022
Revenue from sale of goods and services - point in time 121,118 2,497 (225) 123,390
Revenue from sale of goods and services - over the time 12,927 1,611 - 14,538
Total 134,045 4,108 (225) 137,928

The Group recognises revenue for the sale of goods and services at a specific point in time when control of the activities has been transferred to the customer, usually at the same time as the delivery of the good or provision of the service. Instead, revenue recognition takes place over time, based on the status of performance of contractual obligations, when the performance does not create an asset that has an alternative use for the Group and the Group has the collectible right to payment for the completed performance up to the date considered.

Revenue broken down by type Datalogic Informatics Adjustments 31.03.2023
Sale of goods 137,037 2,127 (71) 139,093
Sale of services 8,681 1,971 (78) 10,574
Total 145,718 4,098 (149) 149,667
Revenue broken down by type Datalogic Informatics Adjustments 31.03.2022
Sale of goods 125,706 2,410 (225) 127,891
Sale of services 8,339 1,698 - 10,037
Total 134,045 4,108 (225) 137,928

Note 17. Cost of goods sold and operating costs

The following table shows the trends of cost of goods sold and operating costs at March 31, 2023, versus the same period of the prior year, before special items.

31.03.2023 31.03.2022 Change
Restated
Cost of goods sold 87,274 82,564 4,710
Operating costs 59,049 53,290 5,759
Research and development expense 17,207 14,268 2,939
Distribution expense 26,856 23,369 3,487
Administrative and general expense 14,403 15,191 (788)
Other operating expense 583 461 122
Total 146,323 135,854 10,469

Cost of goods sold

Cost of goods sold at March 31, 2023 was €87,274 thousand. The upward change for the period of 5.7% decreases however the percentage on revenue by approximately 1.5% from 59.9% to 58.3%; the positive figure is related particularly to the decrease in transportation and logistics costs, which, compared to the comparative quarter, decreased by 48.6%, with the percentage on revenue decreasing by 2.6%.

Operating costs

Operating Costs, amounting to €59,049 thousand, increased by €5,759 thousand (+10.8%) in first quarter 2023 versus the same period of 2022, deteriorating the percentage of sales by 0.8% from 38.6% to 39.5%, as a result mainly of the increase in research and development and in distribution expense.

"Research and development expense" at March 31, 2023 amounted to €17,207 thousand, increasing by 20.6% versus the same quarter of the prior year, accounting for 11.5% of sales (10.3% in the first quarter of the prior year). The detail items showing the largest increase are related to personnel expense and external consulting in connection with ongoing product development projects.

"Distribution expense"amounted to €26,856 thousand, up versus the same period of 2022 (+14.9%). The percentage of sales increases from 16.9% to 17.9%; the change is related mainly to increased personnel expense and increased sales and marketing initiatives and participation in trade fairs and events as well as customer visits.

"Administrative and general expense"amounted to €14,403 thousand at March 31, 2023, decreasing by 5.2% versus the comparison period and improving as a percentage of sales from 11.0% to 9.6%.

"Other operating expense", amounting to €583 thousand, increased versus the prior year and isrepresented mostly by non-income tax and duties and other operating costs.

Costs by type

The following table provides the details of total costs (cost of goods sold and total operating expense) by type:

31.03.2023 31.03.2022 Change
Purchases 63,758 57,350 6,408
Personnel expense 48,065 44,523 3,542
Amortisation, depreciation and write-downs 9,295 8,725 570
Goods receipt and shipment expense 5,122 8,547 (3,425)
Travel and meetings expense 3,390 1,432 1,958
Consumables and R&D material 2,143 1,878 265
EDP expense 2,075 1,610 465
Marketing expense 1,491 1,057 434
R&D technical consultancies 1,350 1,021 329
Utilities 1,153 1,060 93
Legal, tax and other consulting 865 1,512 (647)
Fees 620 379 241
Directors' fees 584 577 7
Building expense 574 548 26
Royalties 531 672 (141)
Expense for plant and machinery and other assets 466 417 49
Telephone expense 456 467 (11)
Sundry service costs 428 464 (36)
Quality certification expense 387 424 (37)
Installations 382 469 (87)
Insurance 360 304 56
Audit fees 358 436 (78)
Non-warranty repairs 323 247 76
Vehicle expense 305 255 50
Entertainment expense 290 139 151
Recruitment fees 282 307 (25)
Repairs and warranty provision accrual 200 194 6
Subcontracted work 181 150 31
Other 887 690 197
Total cost of goods sold and operating costs 146,323 135,854 10,469

Purchases were up by €6,408 thousand (+11.2%) versus the same period of 2022, while the percentage of sales was 42.6%, up from 41.6% in first quarter 2022 as a result of the increase in material and procurement costs.

Personnel expense of €48,065 thousand (€44,523 thousand in first quarter 2022) increased by €3,542 thousand versus the prior year (+8.0%), with the percentage of sales remaining basically steady versus the same period of 2022, rising from 32.3% to 32.1%.

The detailed breakdown of personnel expense is as follows:

31.03.2023 31.03.2022 Change
Wages and salaries 36,880 34,169 2,711
Social security charges 7,662 7,292 370
Post-employment benefits 700 815 (115)
Retirement benefits and the like 502 423 79
Other personnel expense 2,321 1,824 497
Total 48,065 44,523 3,542

The item "amortisation, depreciation and write-downs", amounting to €9,295 thousand, increased by €570 thousand, due to continued increased expenditure incurred in recent years.

"Goods receipt and shipment expense", amounting to €5,122 thousand, fell sharply by €3,425 thousand versus the same period of the prior year; the percentage of sales was 3.4%, back in line with first quarter 2019.

"Travel and meetings expense" and "Marketing expense", amounting to €3,390 thousand and €1,432 thousand, respectively, were up by a total of €1,958 thousand versus the same period of the prior year, as a result of increased business initiatives and participation in trade fairs and events as well as customer visits.

Note 18. Other revenue

At March 31, 2023, "Other revenue"amounted to €578 thousand, increasing by €374 thousand versus €204 thousand in the same period of the prior year, thanks to public grants received for research projects. Other revenue is broken down as follows:

31.03.2023 31.03.2022 Change
Grants to Research and Development expense 280 8 272
Miscellaneous income and revenue 224 152 72
Rents 29 20 9
Gains from disposal of fixed assets 44 10 34
Contingent assets 1 0 1
Other 0 14 (14)
Total 578 204 374

Note 19. Financials

31.03.2023 31.03.2022 Change
Financial income/(expense) (541) (413) (128)
Foreign exchange differences 657 (884) 1,541
Bank expense (417) (309) (108)
Dividends 91 0 91
Other 32 24 8
Total net financials (178) (1,582) 1,404

Financials ended with a negative €178 thousand, improving by €1,404 thousand versus a negative €1,582 thousand in the same period of the prior year, due primarily to the favourabletrend in exchange rate differences.

Note 20. Tax

The Group's tax burden at March 31, 2023 is €763 thousand as shown below.

31.03.2023 31.03.2022 Change
Pre-tax profit/(loss) 3,745 696 3,049
Tax income (expense) - for current tax (568) (704) 136
Tax income (expense) - for deferred and prepaid tax 6 1,337 (1,331)
Total Tax (562) 633 (1,195)
Tax rate 15.0% -90.9% 106.0%

The tax rate at March 31, 2023 reflects the distribution of the profit of the period among the various geographical areas in which the Group operates.

Note 21. Earnings/loss per share

Earnings/loss per share

As required by IAS 33, information on data used to calculate the earning/loss per share is provided below. Basic EPS is calculated by dividing the result for the period, profit and/or loss, attributable to Shareholders of the Parent Company by the weighted average number of shares outstanding during the reporting period. For the purpose of calculating diluted EPS, the weighted average number of shares outstanding is adjusted by assuming the conversion of all potential shares with dilutive effects (such as the share-based incentive plan), while the Group's net result is adjusted for the after-tax effects of conversion.

31.03.2023 31.03.2022
Profit/(Loss) for the period attributable to the shareholders of the parent 3,182 1,329
Average number of shares (thousands) 56,610 56,446
Basic earnings/(loss) per share 0.06 0.02
Profit/(Loss) for the period attributable to the shareholders of the parent 3,182 1,329
Average number of shares (thousands) - Diluted effect 56,979 56,887
Diluted earnings/(loss) per share 0.06 0.02

TRANSACTIONS WITH SUBSIDIARIES THAT ARE NOT CONSOLIDATED LINE BY LINE, ASSOCIATES AND RELATED PARTIES

For the definition of "Related Parties", reference is made not only to IAS 24, approved by EC Regulation no. 1725/2003, but also to the Procedure for Related-Party Transactions approved by the Board of Directors on November 4, 2010 (last amended on June 23, 2021) available on the Company website www.datalogic.com. The parent company of the Datalogic Group is Hydra S.p.A.

Intercompany transactions are carried out as part of the ordinary operations and at normal market conditions. Additionally, there are related-party transactions carried out again in the ordinary course of business and at normal market conditions, of an immaterial amount pursuant to and for the purposes of the "RPT Procedure", attributable mainly to Hydra S.p.A. or to entities subject (with Datalogic S.p.A.) to common control or to persons exercising administrative and management functions at Datalogic S.p.A. (including entities controlled by them and close family members).

Related-party transactions refer mainly to commercial and property transactions (instrumental and non-instrumental premises for the Group leased or rented out), consulting services, and participation in tax consolidation. None of them are of particular economic or strategic importance to the Group, since receivables, payables, revenue, and expense from related parties do not have a material percentage impact on the total amounts of the financial statements.

Pursuant to Article 5, paragraph 8, of the CONSOB Regulations, it should be noted that, over the period 01.01.2023 – 31.03.2023, the Company's Board of Directors did not approve any transaction of greater significance, as set out by Article 3, paragraph 1, letter b) of the CONSOB Regulations, or any related-party transactions of a lesser significance that had a significant impact on the Group's equity position or results.

Parent
Company
Company
controlled by
Chairman of
B.o.D.
Companies not
consolidated on
a line-by-line
basis
31.03.2023
Investments - - 560 560
Trade receivables - accrued income and prepaid
expense
- 11 2,555 2,566
Receivables from tax consolidation 1,807 - - 1,807
Financial receivables - - - -
Payables from tax consolidation 2,013 - - 2,013
Trade payables - accrued expense and deferred income - 39 60 100
Financial payables - - - -
Commercial and service costs - 301 30 330
Trade revenue - - 2,720 2,720
Other revenue - - 3 3

HEADCOUNT

31.03.2023 31.03.2022 Change
Datalogic 2,987 2,809 178
Informatics 69 66 3
Total 3,056 2,875 181

The Chairman of the Board of Directors (Romano Volta)

ANNEXES

ANNEX 1

CERTIFICATION PURSUANT TO ARTICLE 154A, PARA. 2, LEG. DECR. NO. 58/1998

CONSOLIDATED INTERIM REPORT AT MARCH 31, 2023

The undersigned Alessandro D'Aniello, as the Manager responsible for the preparation of the Company's financial reports of Datalogic S.p.A., certify that, in accordance with the provisions of the second paragraph of Article 154-bis of Legislative Decree no. 58 of February 24, 1998, the Consolidated Interim Report at March 31, 2023 corresponds to the underlying records, books and accounting entries.

Lippo di Calderara di Reno (BO), May 11, 2023

Manager responsible for the preparation of the Company's financial reports

Alessandro D'Aniello

ANNEXES

ANNEX 2

CONSOLIDATION SCOPE

The Consolidated Interim Reportincludes the interim statements of the Parent Company and of the companies in which it directly and/or indirectly has control or significant influence. The statements of the subsidiaries were duly adjusted, where necessary, to make them consistent with the Parent Company's Accounting Standards. The companies included in the consolidation scope at March 31, 2023, consolidated on a line-by-line basis, are shown hereunder:

Company name Registered office Share capital Total equity
(Euro/thousands)
Profit (loss) for the
period
(Euro/thousands)
%
Ownership
Datalogic S.p.A. Bologna – Italy Euro 30,392,175 365,283 (14)
Datalogic Real Estate France Sas Courtabeuf Cedex – France Euro 2,227,500 3,958 26 100%
Datalogic Real Estate UK Ltd. Redbourn - United Kingdom
of Great Britain
GBP 3,500,000 4,893 (31) 100%
Datalogic IP Tech S.r.l. Bologna – Italy Euro 65,677 32,902 (1,588) 100%
Informatics Holdings, Inc. Plano, Texas - USA USD 1,568 19,411 459 100%
Wasp Barcode Technologies Ltd Redbourn - United Kingdom
of Great Britain
GBP 0 270 6 100%
Datalogic (Shenzhen) Industrial
Automation Co. Ltd.
Shenzhen - China CNY 2,136,696 6,044 858 100%
Datalogic Hungary Kft Balatonboglar - Hungary HUF 3,000,000 (550) (720) 100%
Datalogic S.r.l. Bologna – Italy Euro 10,000,000 147,582 (1,751) 100%
Datalogic Slovakia S.r.o. Trnava - Slovakia Euro 66,388 6,154 97 100%
Datalogic USA Inc. Eugene OR - Usa USD 100 258,059 2,496 100%
Datalogic do Brazil Comercio de
Equipamentos e Automacao Ltda.
Sao Paulo - Brazil BRL 20,257,000 799 72 100%
Datalogic Technologia de Mexico S.r.l. Colonia Cuauhtemoc -
Mexico
MXN 0 (421) (9) 100%
Datalogic Scanning Eastern Europe
GmbH
Langen - Germany Euro 25,000 3,762 16 100%
Datalogic Australia Pty Ltd Mount Waverley
(Melbourne) - Australia
AUD 3,188,120 1,448 57 100%
Datalogic Vietnam LLC Vietnam USD 3,000,000 27,594 1,528 100%
Datalogic Singapore Asia Pacific Pte
Ltd.
Singapore SGD 3 3,705 116 100%
Datasensing S.r.l. Modena - Italy Euro 2,500,000 20,538 863 100%
M.D. Micro Detectors (TIANJIN) CO.,
LTD.
Tianjin - China CNY 13,049,982 1,297 2 100%
Micro Detectors Ibérica, S.A.U. Barcelona - Spain Euro 120,000 1,406 158 100%
Datalogic Japan Co., Ltd. Tokyo - Japan JPY 9,913,000 87 (1) 100%
PEKAT s.r.o. Brno - Czech Republic CKZ 202,020 (85) - 100%
Suzhou Mobydata Smart System Co.
Ltd
Suzhou, JiangSu - China CNY 161,224 6,675 (84) 51%

Companies consolidated by the equity method at March 31, 2023 are as follows:

Company name Registered office Share capital Total equity
(Euro/thousands)
Profit (loss) for
the period
(Euro/thousands)
%
Ownership
Datasensor Gmbh (*) Otterfing - Germany Euro 150,000 1 10 30%
CAEN RFID S.r.l. (***) Viareggio LU - Italy Euro 150,000 756 (114) 20%
R4I S.r.l. (***) Benevento - Italy Euro 131,250 279 (108) 20%
Datalogic Automation AB (**) Malmö, Sweden SEK 100,000 1,738 799 20%

(*) figures at December 31, 2020

(**) figures at June 30, 2022

(***) figures at December 31, 2021

ANNEXES

ANNEX 3

RECONCILIATION OF ALTERNATIVE PERFORMANCE MEASURES (NON-GAAP MEASURES)

Below is a reconciliation of EBIT and Adjusted EBIT at March 31, 2023 versus March 31, 2022.

31.03.2023 31.03.2022 Change
Adjusted EBIT 5,373 3.59% 4,474 3.24% 899
Special Items -Other Expense and (Income) 260 0.17% 748 0.54% (488)
Special Items - D&A from acquisitions 1,191 0.80% 1,448 1.05% (257)
Total 1,451 0.97% 2,196 1.59% (745)
EBIT 3,922 2.6% 2,278 1.7% 1,644

Below is a reconciliation of EBITDA and Adjusted EBITDA at March 31, 2023 versus March 31, 2022.

31.03.2023 31.03.2022 Change
Adjusted EBITDA 13,477 9.00% 11,752 8.52% 1,725
Cost of goods sold 7 0.00% 18 0.01% (11)
Research and Development expense 65 0.04% - 0.00% 65
Distribution expense 179 0.12% 267 0.19% (88)
Administrative and General expense 9 0.01% 463 0.34% (454)
Other (expense) income - 0.00% - 0.00% -
Total 260 0.17% 748 0.54% (488)
EBITDA 13,217 8.83% 11,004 7.98% 2,213

ANNEXES

ANNEX 4

RESTATEMENT 2022

Comparative results (March 31, 2022) have been restated, as required by IAS 1, in connection with reclassifications of certain items to ensure full comparability of the 2022 results with the 2023 results.

Restatement Income Statement 2022

(Euro/000) 31.03.2022 Restatement 31.03.2022
Restated
1) Revenue 137,928 137,928
Revenue from sale of products 127,891 127,891
Revenue from services 10,037 10,037
2) Cost of goods sold 80,040 2,524 82,564
Gross OperatingMargin (1-2) 57,888 57,888
3) Other revenue 204 204
4) Research and development expense 14,505 (237) 14,268
5) Distribution expense 26,069 (2,700) 23,369
6) Administrative and general expense 14,779 412 15,191
7) Other operating expense 461 461
Total operating costs 55,814 (2,524) 53,290
EBIT 2,278 2,278
8) Financial income 5,246 5,246
9) Financial expense 6,828 6,828
Net Financials (8-9) (1,582) (1,582)
10) Profits from associates - -
Profit/(Loss) before tax from continuing operations 696 696
Income tax (633) (633)
Profit/(Loss) for the period 1,329 1,329
Basic earnings/(loss) per share (€) 0.02 0.02
Diluted earnings/(loss) per share (€) 0.02 0.02
Attributable to:
Shareholders of the Parent Company 1,370 1,370
Non-controlling interests (41) (41)

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