Nordic Unmanned ASA

Interim / Quarterly Report • Aug 31, 2022

Half-year report 2022 and operational update

Established 2014

7 offices

Operations in 20+ countries

Solid growth platform in rapidly expanding market

Nordic Unmanned delivers industry-leading drone services, products and data analysis in a rapidly evolving industry with a significant future market opportunity

• World-leading in BVLOS (Beyond Visual Line of Sight) flights
• Operates 34 unmanned aircraft with a total fleet value of EUR 20 million+
• Unique air emission data on more than 1500 vessels collected
• Safeguarded more than 1000 migrants in search and rescue operations
• Executed 5 acquisitions and established 2 joint ventures
• Holds probably the world's most comprehensive civilian unmanned operational license (LUC)
• Contracts for more than EUR 85 million won since start-up
• One of the leading listed pure-play drone companies globally by revenue in H1 2022.
• Youngest company of the top 5
• 2nd biggest in Europe in terms of revenue
• 5th biggest globally in revenue
• 2nd largest globally based on drone as a service

Focus on mature market segments with firm outlook for profitable growth

Reshaped organisational structure to support value creation

Organised into fully-functional business units

Q2'22 Highlights

Group highlights • Q2: Record revenue EUR 4.8 million

• • +57% compared to Q2 2021
• H1: Record revenue EUR 7.3 million
• +84% compared to H1 2021
• Revenue mid-August exceeded full year 2021
• Profitability negatively affected by delayed startup of operations and other temporary impacts
• Private placement and subsequent offering of NOK 96 million
• Uplisting will most likely be postponed into 2023, awaiting full implementation of the legal entity and operational model

Nordun Record number of flight hours

• Revenue Q2 mEUR 3.2 (2.3)
• EBITDA Q2 mEUR -1.0 (0.0)
• Total investment in business unit of EUR 20+ million
• 814 flight hours in Q2, increase of 56% compared to Q2 2021
• 1010 flight hours in H1, an increase of 57% compared H1 2021
• More than 50,000 km flown in Q2, 1.25 times around the globe
• Four simultaneous BVLOS (Beyond Visual Line of Sight) deployments in Europe
• Slower start-up of operations and implementation of new fixed-wing operations impacted the profits negatively

FLIGHTS AND FLIGHT HOURS

Illustrative fleet planning Camcopter 2022

Illustrative fleet planning Aerosonde 2022

Serviceability

• 703.8 revenue long endurance flight hours produced in Q2
• Delivered 74.8% of scheduled hours
• Main impact on flight cancellations in Q2 is weather with 16%, mainly in the Aerosonde operation
• Camcopter's flight cancellation impact due to technical reasons, a cancellation rate of 11.5%, similar to the historical rate

Long Endurance flight cancellation

NUMar Maritime emission data and analytics platform

• Revenue Q2 mEUR 0.4 (0)
• EBITDA Q2 mEUR 0.0 (0)
• Total investment in business unit of mEUR 4

NUAer:

• Completed sensor integration with the Schiebel Camcopter
• Enables long-range integrated emissions monitoring

Ecoxy

• High demand of accredited NOx measurements in Scandinavia throughout Q2
• New customers within EU ETS verification service
• Data from more than 1300 unique accredited measurements of NIS/NOR registered vessels and drilling rigs

NUTech Bundeswehr contract, a commercial breakthrough

• Revenue Q2 mEUR 0.3 (0.4)
• Gross profit Q2 mEUR 0.2 (0.4)
• EBITDA Q2 mEUR -0.2 (0.2)
• Business unit book value of EUR 11 million
• Investment in Q2 of EUR 3.2 million
• First delivery of 145 AirRobot AR100-H systems
• Developed Staaker Logistics Drone
• Staaker Railway drone reached milestone
• Expected start of operations in the US in September 2022
• Added DroneMatrix to the NUTech product portfolio by acquiring 55% in June

NUGlobal Sudden demand acceleration due to security situation

• Revenue Q2 mEUR 0.9 (0.4)
• Gross profit Q2 mEUR 0.3 (0.1)
• EBITDA Q2 mEUR 0 (-0.1)
• Business unit book value of EUR 1.7 million (inventory)
• Ukraine war has led to sudden and radical change in demand for drones
• Sale of surveillance drones to a donating European country, including training of drone operators from the Ukrainian Armed Forces
• Several large open offers awaiting funding or priority
• Conclusion of these opportunities would potentially have substantial effect in H2 2022 as adequate stock levels has been secured
• The establishment of a global distribution network has started

Nordun NUGlobal NUMar NUTech

• around 65% of backlog
• EMSA contracts main source
• MIKADO contract with Bundeswehr main addition to backlog
• NUMar has traditionally short time between order and delivery and therefore no representation in the backlog yet

Potential awards in the near future

Urgent request for tactical UAV

System integrator capability for governmental customers in Europe

Offshore energy

Several offshore logistical concepts, shore to offshore

EMSA/OP5/2022

VTOL RPAS services for multipurpose maritime surveillance with medium range and endurance Up to EUR 20.5 mill

Total CRM Pipeline: EUR 1.1bn

Value adjusted win rate of 55%*

Additional triggers:

• Maritime border monitoring
• Heimdal Indago payload

Profit and loss: Strong growth – profitability below target

	Quarters		First half
Amounts in EUR	Q2 2022	Q2 2021	2022	2021
Operating revenue	4 821 273	3 073 957	7 313 348	3 967 141
Gross profit	4 052 407	2 680 796	5 798 078	3 474 931
Gross margin %	84%	87%	79%	88%
EBITDA	-2 952 556	-785 870	-4 971 189	-1 644 852
Net income (loss)	-3 683 786	-1 245 308	-6 340 089	-1 956 352

• Q2 revenue growth of 57% and H1 revenue growth of 84%
• Lower utilisation of our BVLOS fleet and crew than expected due to late start.
• Ramp-up cost and challenging start related to our entrance into the fixed wing segment.
• Costs related to M&A and uplisting projects of EUR 0.5 million for the quarter and EUR 0.7 million YTD.
• Cost saving program of EUR 2 million identified and started

Financial position and liquidity reserve

Cash and cash equivalents Other current assets Non-current assets

Non-current liabilities Current liabilities Equity

Available liquidity of EUR 5.2 million

Cash and committed loan facilities Available credit lines

Summary

Record high revenue and growth in Q2, however below plan

Q2 cost base prepared for even higher growth, including earlier start of contracts. Significant investment in fixed-wing capability build-up

Full-year 2021 revenue already passed as of mid-August. Expect higher revenue and higher profitability in H2 2022 based on ongoing operations and existing backlog

Several large opportunities could potentially impact the further growth rate and corresponding profitability in H2 positively

We have now established the platform needed for future growth in terms of M&A and fleet expansion. Focus will be on sales and distribution

Increased capacity and market maturity will drive growth

2025 Growth Targeting EUR 400 million in revenue in 2025 2022 Growth 200 percent growth is still likely within reach but will require substantial awards within the Security and Defense sector. 2022 EBITDA EBITDA margin of 10-20 percent will not be achieved

Global partnerships

Pursuing global partnerships

Definitions

Revenue per flight hours	Total revenue (excluding revenue for the Security business area) for the period divided by total flight hours (excluding flight hours for the Security area) for the period.
EBITDA	Profit/(loss) for the period before net financial items, income tax expense, depreciation and amortization
Covid adjusted EBITDA*	(*) Adjusted EBITDA is EBITDA adjusted for one-off Covid-19 associated cost. Covid-19 associated cost includes additional medical certificates and tests, additional travel insurance, quarantine days for crew before and after operation, additional hotel and logistics costs, overtime pay, and employee bonuses.
Contract backlog	Contract backlog includes the maximum remaining estimated value of signed contracts
Historic win rate	Value of opportunities above EUR 200k won divided by aggregate value of closed targeted opportunities above EUR 200k
Revenue per country	Revenue divided into country of end-user
MRO	Maintenance, repair & overhaul
CRM estimate	Value of CRM is converted to Euro
Definitions in sales pipeline	Prospect: Potential leads not formally confirmed Qualified lead: Lead formally confirmed or received from client RFI delivered: Response to request for information (RFI) RFP / Proposal: Ongoing proposal response Awaiting award: Tender or offer submitted Projects with ongoing negotiations or un-announced wins not included in CRM pipeline

Definitions

Reduced CO2 emissions	Average CO2 Average CO2 emission of CAMCOPTER S-100 emission of Sikorsky S92 and Challenger CL604 per flight hour – per flight hour = Reduced CO2 emission.
	Our flight operations could be conducted by these comparable manned platforms; the helicopter Sikorsky S92 and the maritime surveillance plane Challenger CL604. Therefore, the average of these two platforms have been used when comparing CO2 footprint with large drone flight operations. In 2021 this calculations is based on 1060 flight hours.
Value adjusted win rate	Based on 97 historical opportunities with value above EUR 200.000

Disclaimer – forward looking statements

• In addition to historical information, this presentation contains statements relating to our future business, events and/or results. These "forward-looking" statements include certain estimates, assumptions and projections of Nordic Unmanned AS (the "Company"), based on information currently available to the Company. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including statements preceded by, followed by or that include the words "estimate, "plan," project," "forecast," "intend," "expect," "predict," "anticipate," "believe," "think," "view," "seek," "target," "goal" or similar expressions; any projections of earnings, revenues, expenses, synergies, margins or other financial items; any statements of the plans, strategies and objectives for future operations, including integration and any potential restructuring plans; any statements concerning proposed new products, services, developments or industry rankings; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.
• Forward-looking statements do not guarantee future performance and involve risks and uncertainties. By their nature, forward-looking information and statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements that may be expressed or implied by the forward-looking information and statements in this report. These forward- looking statements are based on the current estimates and projections of the Company. No update or revision will be made to forward-looking statements contained herein, whether as a result of new information, future events or otherwise. Although Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies, which are impossible to predict and are beyond Company's control, Company cannot assure achievement or accomplishment of such expectations, beliefs or projections.
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