Holland Colours NV

Earnings Release • Jun 4, 2021

PRESS RELEASE

RESULTS 2020/2021 HOLLAND COLOURS

Better Than Expected At The Outset

Holland Colours, a global producer of colorants and additives for plastics for the building & construction, packaging and coatings markets, delivered better results in 2020/2021 than the company expected at the start of the financial year, which coincided with many countries around the world going into lockdown. Thanks to a stringent focus on employee safety, commitment to customers, and tight controls on costs and investments, the Company is able to report the following results for financial year 2020/2021:

• 5% revenue decrease on the previous financial year;
• Operating result from continued operations was € 12.4 million versus € 10.8 million previous year;
• Net result after discontinued operations was € 9.6 million versus € 7.9 million prior year and net earnings per share came in at € 11.00 versus € 9.09 prior year;
• Final dividend proposed of € 4.8 million (€ 5.50 per share).

Revenue for the 2020/2021 financial year was € 96.0 million, a decrease of 5% on the previous year (€ 101.5 million). This included a negative impact (€ 2.2 million) arising from the translation from USD to EUR.

The EMEIA division (Europe, the Middle East, India, and Africa) saw a revenue decline of 6%, and all focus segments were down compared to the previous year. Revenue in Asia was down by 8% in functional currency, primarily due to lower volumes. Revenue growth of 5% in functional currency for the Americas division was mainly the result of higher volumes.

The net margin for the Group was € 46.2 million, an increase of € 0.5 million on the year before. The margin as a percentage of revenue ended higher at 48%, versus 45% in the previous year. This increase was due to a favorable geographical and product mix.

Operating expenses were € 33.8 million, down € 1.1 million (3%) from the previous year, primarily due to lower travel costs. Labor costs, maintenance and forex-related devaluations of receivables were also favorable compared to the previous year. In the United States the Company received assistance amounting to € 1 million under the US government's Payroll Protection Program. The operating result from continued operations was € 12.4 million, versus € 10.8 million for the previous year.

The net result was € 9.6 million (€ 11.10 per share) versus € 7.9 million in the previous year (€ 9.09 per share). In line with Holland Colours' dividend policy, a final dividend of € 4.8 million is proposed (€ 5.50 per share).

Net cash flow came in at € 9.0 million, versus € 0.2 million last year. The higher net cash flow was a result of, among other things, a higher cash flow from operating activities of € 2.0 million, the favorable development of working capital, which amounted to € 3.8 million, a reduction in investments to € 2.3 million, and favorable translation differences on Cash and Cash Equivalents of € 0.6 million.

The Company paid € 0.8 million less income tax. Higher dividend of € 0.9 million paid in November 2020. There were no changes in the company's funding. Except for the liabilities related to IFRS 16, the company remains loan free.

COVID-19

Our priority at the outset of the COVID-19 pandemic was to first take care of our employees. The divisions took various steps, including introducing new work schemes, and our people acted carefully and responsibly to minimize the chances of the coronavirus entering Holland Colours.

With all measures in place, we could then focus on keeping our customers supplied. The deliveries to our customers have not been affected due to the pandemic.

For more information on the full financial results as published today, please refer to the Holland Colours website www.hollandcolours.com.

OUTLOOK 2021/2022

Holland Colours does not make forward-looking statements. However, because of COVID-19, the outlook appears more unstable and there continues to be uncertainty.

At the same time, based on our growth strategy and accompanying internal improvements we feel there are grounds for optimism.

Apeldoorn, June 3, 2021

Board of Management

Coen Vinke Tanja van Dinteren Eelco van Hamersveld

In thousands of euros		April 1, 2020/March 31, 2021		April 1, 2019/March 31, 2020
Revenue		96.029		101,539
Cost of Materials		(49,781)		(55,772)
Direct Contribution Margin		46.248		45,767
Personnel Expenses	(19,939)		(20.186)
Amortization and Impairments	(124)		(142)
Depreciation and Impairments	(2.935)		(2.747)
Other Operating Expenses	(10.834)		(11,904)
Total Operating Expenses		(33,832)		(34.979)
Operating Result		12,416		10,788
Finance Income	22		20
Finance Expense	(97)		(105)
Finance Income and Expense		(75)		(85)
Result Before Income Tax		12,341		10,703
Income Tax		(2,762)		(2,784)
Net Result from Continued Operations		9,579		7,919
Discontinued Operations				(23)
Net Result after Discontinued Operations		9,579		7.896
Attributable to:
. Shareholders of the Company		9,471		7,823
• Non-Controlling Interest		108		73
		9.579		7.896
Earnings per Share in euros
Average Number of Shares Issued		860.351		860.351
Earnings per Share from Continued Operations		11.00		9.12
Earnings per Share from Total Net Result		11.00		9.09

In thousands of euros	April 1, 2020/March 31, 2021	April 1, 2019/March 31, 2020
Net Result	9.579	7,896
Items that will not be reclassified to the Income Statement Actuarial Results on Employee Benefits, after Tax	(8)	(56)
Other Comprehensive Income that could in future be classified to the Income Statement Foreign Currency Translation Differences	(2, 134)	392
Other Comprehensive Income	(2, 142)	336
Total Comprehensive Income	7,437	8,232
Attributable to: · Shareholders of the Company • Non-Controlling Interest	7,329 108 7.437	8.159 73 8,232

In thousands of euros	March 31. 2021	March 31. 2020	In thousands of euros	March 31. 2021	March 31. 2020
Non-Current Assets			Equity
Intangible Assets	156	280	Share Capital	1.953	1.953
Property, Plant and Equipment	19,354	20,398	Share Premium Reserve	1,219	1.219
Right-of-Use Assets	1,616	1.425	Other Reserves	(1.633)	608
Deferred Tax Assets	1,319	1,318	Retained Earnings	48,719	43,064
Long-Term Receivables	60	80	Equity Attributable to Shareholders of the Company	50,258	46,844
	22,505	23,501	Non-Controlling Interest	341	233
			Total Equity	50,599	47,077
Current Assets
Inventory	12,604	12.782	Non-Current Liabilities
Trade and Other Receivables	16.647	18,857	Long-Term Debt
					٠ 565
Income Tax Receivables	331	396	Lease Liabilities	956
Cash and Cash Equivalents	16,638	7,666	Employee Benefit Obligations	1.093	1.134
	46,220	39.701	Deferred Tax Liabilities	189	271
				2,238	1,970
			Current Liabilities
			Lease Liabilities	643	879
			Trade and Other Liabilities	13,615	12.414
			Income Tax Liabilities	1.546	775
			Employee Benefit Obligations	84	87
				15,888	14,155
			Total Equity and Liabilities	68.725	63,202
Total Assets	68,725	63,202

In thousands of euros	Equity attributable to Shareholders of the Company
	Share Capital	Share Premium Reserve	Legal Reserve for Currency Translation	Legal Reserve for Hedge	Legal Reserve for Intangible Assets	Retained Earnings	Total	Non- Controlling Interest	Total Equity
As at March 31, 2019	1,953	1,219	343	(353)	402	38,154	41,718	160	41,878
Net Result for the Financial Year					-	7,823	7,823	73	7.896
Other Comprehensive Income		-	392		-	(56)	336	-	336
Total Comprehensive Income		-	392		-	7.767	8.159	73	8.232
Transfer of Reserve for Intangible Assets					(176)	176
Dividends Paid						(3,033)	(3,033)		(3,033)
As at March 31, 2020	1,953	1,219	735	(353)	226	43,064	46,844	233	47,077
Net Result for the Financial Year						9.471	9.471	108	9.579
Other Comprehensive Income		۰	(2.134)	$\overline{\phantom{a}}$	-	(8)	(2, 142)	-	(2, 142)
Total Comprehensive Income		$\overline{\phantom{0}}$	(2, 134)		$\overline{\phantom{0}}$	9.463	7,329	108	7,437
Transfer of Reserve for Intangible Assets					(107)	107
Dividends Paid					$\overline{\phantom{a}}$	(3,915)	(3,915)		(3,915)
As at March 31, 2021	1,953	1,219	(1.399)	(353)	119	48,719	50,258	341	50,599

	April 1, 2020/ March 31.	April 1. 2019/ March 31.
In thousands of euros	2021	2020
Operating Result	12.416	10,788
Adjustments for:
Amortization of Intangible Assets and
Impairments	124	142
• Depreciation of Property, Plant and Equipment
and Impairments	2,310	2.139
Depreciation of Right-of-Use Assets	625	608
Changes in Provisions	44	(82)
Exchange Rate Differences	20	(80)
Cash Flow from Operating Activities before
changes in Working Capital, Tax and Interest	15.539	13,515
Changes in Working Capital	1,066	(2.774)
Income Tax Paid	(2.008)	(2,831)
Interest Received	22	20
Interest Paid	(97)	(103)
Cash Flow from Operating Activities from
Continued Operations	14,522	7,827
Cash Flow from Operating Activities from
Discontinued Operations		(23)
Cash Flow from Operating Activities	14.522	7,804

In thousands of euros	April 1. 2020/ March 31. 2021	April 1. 2019/ March 31. 2020
Capital Expenditures in Intangible Assets		(3)
Capital Expenditures in Property, Plant and
Equipment	(1.953)	(4.290)
Cash Flow from Investment Activities	(1.953)	(4.293)
Dividend Paid	(3.915)	(3.033)
Cash Flow from Financing Activities	(3.915)	(3,033)
Exchange Rate and Translation Differences
on Cash and Cash Equivalents	318	(246)
Net Cash Flow	8.972	232
Cash and Cash Equivalents as at April 1	7,666	7.434
Cash and Cash Equivalents as at March 31	16,638	7.666
Net Cash Flow	8.972	232

SEGMENT REPORTING

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2021

Segments 2020/2021	EMEIA	Americas	Asia		Adjustments/ Other Eliminations	Total
Revenue	48.929	32.236	14.864	-	-	96.029
Intersegmental Transactions	902	29	$\overline{\phantom{0}}$		(931)
Revenue including Intersegmental Transactions	49,831	32,265	14,864	-	(931)	96,029
Depreciation, Amortization and Impairments	(1,242)	(707)	(349)	(313)	(448)	(3.059)
Operating Result from Continued Operations	3,676	3.745	3,805	1.190	-	12,416
Operating Result from Discontinued Operations
Operating Result after Discontinued Operations	3,676	3,745	3,805	1,190	-	12,416
Financial Income					22	22
Financial Expense					(97)	(97)
Tax					(2.762)	(2.762)
Net Result					9,579	9.579
Non-Current Assets	10.024	5.940	3.822	52.093	(49, 375)	22.505
Current Assets	20,230	16.264	7.516	2.134	76	46.220
Liabilities	14,182	3,781	2,291	3,297	(5, 425)	18,126
Total Investments	1,388	406	159			1,954
Average Number of Employees (in FTE)	208	101	112	15		436
Segments 2019/2020	EMEIA	Americas	Asia		Adjustments/ Other Eliminations	Total
Revenue	52,207	32.541	16,791	۰	-	101,539
Intersegmental Transactions	1,015	25	24	-	(1,064)
Revenue including Intersegmental Transactions	53,222	32,566	16,815	-	(1,064)	101,539
Depreciation, Amortization and Impairments	(1.149)	(642)	(285)	(222)	(591)	(2.889)
Operating Result from Continued Operations	3,275	2.144	3.534	1,835	-	10,788
Operating Result from Discontinued Operations	-	-	(23)	-	۰	(23)
Operating Result after Discontinued Operations	3.275	2.144	3.511	1.835	۰	10.765
Financial Income					20	20
Financial Expense					(105)	(105)
Tax					(2,784)	(2.784)
Net Result					7,896	7,896
Non-Currant Accatc	9.924	E ERR	3.534	46.R15	MAR ARM	23.501

NOTES

General

The condensed consolidated financial information for the year 2012/2021 with related comparative information has been prepared using accounting policies which are based on International Financial Reporting Standards (IFRS).

Disclaimer

This press release is based on the annual financial statements and contains only a part of these statements. The annual financial statements are published on June 3, 2021 and will be presented to the General Meeting of Shareholders for adoption on July 15, 2021.

The auditor has issued an independent auditor's statement of approval for the annual financial statements that have been prepared.

	2020/21	2019/18	2018/19	2017/18	2016/17
Income statement
Revenue	96.0	101.5	90.9	83.5	77.5
Operating result before depreciaton
and amortisation (EBITDA)	15.5	13.7	10.7	10.2	9.1
Depreciation of property, plant,
equipment and intangibles	(3.1)	(2.9)	(1.9)	(2.0)	(1.9)
Operating result	12.4	10.8	8.8	82	72
Interest	(0.1)	(0.1)	(0.1)	$\overline{\phantom{0}}$	(0.1)
Income tax	(2.8)	(2.8)	(2.3)	(2.2)	(1.7)
Result of discontinued operations		(0.0)	(0.2)	(0.1)	(0.2)
Net result	9.6	79	6.1	5.9	5.2
Statement of financial position
Total assets	68.7	63.2	578	50.2	494
Total equity	50.6	47.1	41.8	367	35.9
Interest-bearing debt			-
Working capital 1	19.6	21.3	19.4	17.2	14.3
Invested capital 2	38.1	39.9	36.6	32.6	29.7
Cash	16.6	7.7	7.4	5.3	7.5

Statement of cash flows
Cash flow from operating activities	14.5	7.8	7.7	3.3	7.2
Investments	(2.0)	(4.2)	(2.9)	(2.5)	(3.6)
Dividend	(3.9)	(3.0)	(2.9)	(2.6)	(1.9)
Other financial activities 3	0.3	(0.5)	0.2	(0.4)	(1.0)
Net cash flow	9.0	0.2	2.1	(2.2)	0.7
Revenue per division
EMEIA	494	53.2	48.9	439	39.1
Americas (in USD)	37.9	36.1	32.4	34.1	31.6
Asia (in USD)	17.2	18.7	17.2	14.0	11.6
Ratios
Return on Sales (ROS)	12.9%	10.6%	9.6%	9.8%	9.3%
Solvency 4	73.6%	74.5%	72.3%	73.1%	72.7%
Return on Investment (ROI) 5	32.6%	27.0%	24.0%	25.2%	24.2%
Working capital in % of revenue	20.4%	21.0%	21.3%	20.6%	18.5%
Market capitalisation as at March, 31	106.7	68.8	65.7	76.6	59.8
Number of shares outstanding	860.351	860.351	860.351	860.351	860.351

PROFILE

Holland Colours develops, produces and commercializes solid and liquid colorants, masterbatches and additives for building and construction plastics (PVC) and packaging (PET and polyolefins). Next to serving these global markets, we offer color concentrates for coatings, elastomers and adhesives and other applications. Our technical experts are always creating new color solutions to give our customers peace of mind based on precise color match and color consistency.

Holland Colours is a Dutch company listed on the Euronext Amsterdam Stock Exchange. With committed employee shareholders and operations in the Americas, EMEIA and Asia, we provide personal local service on a global scale.

KEY DATES (indicative)

July 15, 2021	Annual General Meeting of Shareholders
July 19, 2021	Ex-dividend listing
July 20, 2021	Dividend record date
July 23, 2021	Dividend payable
October 22, 2021	Publication of interim results 2021/2022
May 25, 2022	Publication of 2021/2022 financial statements
July 7, 2022	Annual General Meeting of Shareholders

Holland Colours NV

PO Box 720 | 7300 AS Apeldoorn | Netherlands Tel + 31 (0)55 368 07 00 | Fax + 31 (0)55 366 29 81 ir@hollandcolours.com | www.hollandcolours.com |