Desert Control AS

Investor Presentation • Feb 25, 2022

Making Earth Green Again – to foster the prosperity of life

1

H2 2021 Financial Update

Financial Updates for the second half 2021 Desert Control AS

to foster the prosperity of life

Cultivate and green 1oo Million Hectares of degraded land and desert by 2030

Contribute to sustainable social impact, immense water savings and balanced climate with carbon sequestering

Establish a social impact initiative throughout Sub Sahara by 2025 to reduce poverty and hunger

ABOUT DESERT CONTROL

HIGH-LEVEL COMPANY OVERVIEW | FOCUS AND SOLUTION AREAS

FOCUS

▪ Desert Control specializes in climate-smart agriculture technology to combat desertification, soil degradation, and water scarcity

12 million hectares of fertile land perish to desertification and droughts annually

Less than 60 years left for global agriculture if soil degradation continue at current pace

1.8 Billion people will suffer absolute water scarcity by 2025

SOLUTION

▪ LiquidNatural Clay (LNC) restores and protectssoil,reduce water usage, and increase yields; for agriculture, forests, and green landscapes

AGENDA | H2 2021

H2 2021 REPORT AND FINANCIAL RESULTS | COMPANY PRESENTATION

Karlsen CFO /CTO

FINANCIAL RESULTS

Erling Rasmussen Chief Financial Officer

QUESTIONS AND ANSWERS

Erling Rasmussen / Tor Karlsen Webcast Session

HIGHLIGHTS | H2 2021

FROM START-UP TO SCALE-UP BACKED BY A SOLID FINANCIAL POSITION

CORPORATE DEVELOPMENT

• Established Desert Control Americas as a wholly owned company in the U.S.
• Hired first employees in the U.S.
• Reached agreement to establish a new sales and distribution company in partnership with Mawarid in the UAE
• Grew the organization 5X (from 10 to 51 employees)

TECHNOLOGY AND OPERATION

• 3X increase in LNC production capacity
• Gained significant experience running the first LNC production cluster
• Operational team for the first cluster are prepared as trainers for new hires to streamline onboarding and ramp-up
• Established new R&D center and innovation lab in Norway
• Started building first LNC unit in the U.S.

COMMERCIAL AND MARKET

• Successfully executed stage two of the MoU with Abu Dhabi based Mawarid Holding Investment
• Ready for commercialization in the UAE
• Gained global awareness at EXPO 2020
• Concluded final agreement with the University of Arizona for the first pilot on American soil (launching in Q1 2022)
• Identified multiple leads in the U.S.

THE MAWARID DESERT CONTROL PARTNERSHIP

STRATEGIC PARTNERSHIP IN THE MIDDLE EAST

THE MAWARID DESERT CONTROL PARTNERSHIP

STRATEGIC PARTNERSHIP TO SERVE THE ENTIRE UAE MARKET AND WIDER MIDDLE-EAST, NORTH AFRICA REGION

ABOUT MAWARID

• Manage agriculture, forests, green landscapes and natural resources on large scale
  • 11,000 employees
  • 3,000 vehicles, specialty equipment, and machinery for their forest management and agriculture operation which includes;
  • 200,000 hectares of cultivated land and areas of nature conservation
  • 160,000 km of irrigation pipelines
  • 438 forests
  • 13 million forest trees
  • 630,000 date palms
  • 80 private farms and 30 organic farms
  • A range of nurseries with a combined capacity of 25 million seedlings per year
• Mawarid is dedicated to strategic initiatives for national food security, climate resilience, and sustainability in the UAE and MENA region

TECHNOLOGY AND OPERATION

3X INCREASE IN LNC PRODUCTION CAPACITY | 5X GROWTH OF THE ORGANIZATION

DEFINITIONS

• LNC production unit: mobile factory for in-situ LNC production
• Cluster: 4 units
• Capacities:
  • 15,000 l/h per unit
  • 60,000 l/h per cluster

PRODUCTION CAPACITY DEVELOPMENT

0 10 20 30 40 50 60 70 80 2018-Q3 2018-Q4 2019-Q1 2019-Q2 2019-Q3 2019-Q4 2020-Q1 2020-Q2 2020-Q3 2020-Q4 2021-Q1 2021-Q2 2021-Q3 2021-Q4 2022-Q1 Estimate USA - Technology USA - Administration UAE - Sales & Marketing UAE - Operations UAE - Technology UAE - Administration Norway - Technology Norway - Administration

FTE DEVELOPMENT

NEW R&D CENTER IN NORWAY

THE CENTER WILL SERVE AS THE COMPANY'S GLOBAL INNOVATION LAB

EXPO 2020 HIGHLIGHTS

DUBAI, UNITED ARAB EMIRATES, 1 OCTOBER 2021 – 31 MARCH 2022

DESERT CONTROL AT EXPO 2020

• Desert Control is featured at the "Good Place Pavilion" in the Opportunity District
• The "Plantar Project" is a specific landscaping plot in the "Good Place Pavilion" allocated to Desert Control for LNC application showcasing
• Demos with LNC kits featured at the Sustainability Pavilion for the full six months of EXPO 2020
• Desert Control is one of 140 selected Global Innovators
• Significant leads and opportunities as well as global awareness

OUTLOOK | FOCUS AND AMBITIONS FOR H1 2022

CONTINUED OPERATIONAL SCALE-UP TARGETING FULL-SCALE COMMERCIALIZATION IN UAE IN 2022

KEY OBJECTIVES FOR THE FIRST HALF INCLUDE:

• Successfully establish the new sales and distribution company in partnership with Mawarid in Q1 and achieve sales with effect from Q2
• Transfer pilots and early-stage opportunities in the UAE to the new Mawarid Desert Control company
• Implement the first pilot projects on American soil in collaboration with the University of Arizona
• Launch additional LNC collaboration initiatives with universities in the US
• Align production capacity with the business plan and market demand
• Strengthen Desert Control's executive leadership team
• Build capabilities to support the next stage of full-scale commercialization in the UAE

AGENDA | H2 2021

H2 2021 REPORT AND FINANCIAL RESULTS | COMPANY PRESENTATION

Erling Rasmussen / Tor Karlsen CFO /CTO

FINANCIAL RESULTS

Erling Rasmussen Chief Financial Officer

Erling Rasmussen / Tor Karlsen Webcast Session

KEY FIGURES | H2 2021

DESERT CONTROL MAINTAINS A SOLID NET CASH POSITION OF NOK 179.3M AS OF 31 DECEMBER 2021

FINANCIAL HIGHLIGHTS H2 2021

(H2 2020 in brackets)

• Revenue NOK 3.1M [NOK 0.2M] , full year NOK 3.1M [NOK 1.0M]
• EBITDA* NOK -18.2M [NOK -5.6M] full year NOK -31.1M [NOK -11.1M]
• Net Income NOK -18.7M [NOK -7.6M] full year NOK -31.8M [NOK -11.2M]
• Total cash balance: NOK 179.3M
• Equity: NOK 194M (equity ratio 96% as of 31.12.2021)
• Gross R&D Investments: NOK 6.9M [NOK 2.9M] full year NOK 14.4M [NOK 4.5M]

COMMENTS TO H2 RESULTS

• IFRS accounting policy has been implemented in 2021. Figures for 2020 and 2021 has been edited to reflect this policy. The profit for financial year 2021 has been depressed by NOK 8.7M and for the financial year 2020 by NOK 5.0M compared to the former GRS policy.
• Revenue for 2021 is purely income from pilot projects, mainly the Mawarid project mentioned earlier.
• Build capability for full commercialization in UAE
• Build capability to secure the scale-up from Norway

* EBITDA, Earnings Before Interest Taxes Depreciations and Amortizations

FINANCIAL RESULTS| H2 2021

INTERIM CONSOLIDATED PROFIT AND LOSS (P&L) STATEMENT

Unaudited NOK (in thousands)

		2021	2020	2H 2021	2H 2020
Total Revenue		3 127	041 1	3 127	220
of Goods Sold (COGS) Cost		563	40	369	36
Gross Margin		2 564	1 001	2 758	184
Payroll		14 993	290 7	10 413	3 484
Other Expenses		18 622	813 4	10 500	178 4
Operating Expenses		33 614	12 103	20 913	7 662
EBITDA	-	31 050 -	11 102 -	18 155 -	7 478
Depreciation		1 546	9	1 045	9
Impairment		644		644	-
EBIT	-	33 241 -	11 110 -	19 844 -	7 487
Finance Expenses	-	1 476	119 -	1 120	124
Net Income	-	31 765 -	11 229 -	18 724 -	7 611

STATEMENT OF FINANCIAL POSITION : ASSETS | H2 2021

INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Unaudited NOK (in thousands)

Equity

Non-current Liabilities

Current Liabilities

Balance sheet
All figures in NOK 000s	31 12 2021	31 12 2020
Fixed assets
Research development &	-
Goodwill	6 504	6 345
plant and equipment Property ,	10 425	385 1
Right -of assets -use	2 006
Total fixed assets	18 935	7 730
Current assets
Inventory	99	-
Debtors	544	-
Other short receivables -term	597 5	2 002
Fixed funds income	77 347	-
Cash and bank deposits	101 924	28 935
Total current assets	185 510	30 937

All figures in NOK 000s 31.12.2021 31.12.2020

Share capital (40 724 639 shares at 0.003) 122 70 Other paid-up capital 230 849 40 994 Retained earnings (36 701) (5 748) Total equity 194 270 35 316

Total non-current liabilities 1 423 -

Trade creditors 2 523 838

Public duties payable 912 415 Other current liabilities 1 608 2 098

Current provisions 3 181 - Total liabilities 8 751 3 351

Total equity and liabilities 204 445 38 667

Non-current lease liabilities 1 423

Current lease liabilities 528

STATEMENT OF FINANCIAL POSITION : EQUITY & LIABILITIES | H2 2021 Fixed income funds 77 347 - Cash and bank deposits 101 924 28 935

All figures in NOK 000s 31.12.2021 31.12.2020

Goodwill 6 504 6 345 Property, plant and equipment 10 425 1 385

Total fixed assets 18 935 7 730

Inventory 99 - Debtors 544 - Other short-term receivables 5 597 2 002

Research & development -

Right-of-use assets 2 006

INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION Total current assets 185 510 30 937

Unaudited NOK (in thousands) Total assets 204 445 38 667

Balance sheet

Fixed assets

Current assets

All figures in NOK 000s	31 12 2021	31 12 2020
Equity
(40 003) Share capital shares 724 639 0 at	122	70
Other paid capital -up	230 849	40 994
Retained earnings	(36 701)	(5 748)
Total equity	194 270	35 316
Liabilities Non-current
lease liabilities Non-current	1 423
Total liabilities non-current	1 423	-
Liabilities Current
lease liabilities Current	528
Trade creditors	2 523	838
Public duties payable	912	415
Other liabilities current	1 608	2 098
Current provisions	3 181	-
Total liabilities	8 751	3 351
Total equity and liabilities	204 445	38 667

STATEMENT OF CASH FLOWS | H2 2021

INTERIM CONSOLIDATED CONDENSED CASH FLOWS

Unaudited NOK (in thousands)

All figures in NOK 000s	Consolidated cash flow statement	2021	2H 2021	2020
	Cash flow from operating activities
	Profit before taxes	2021 2H 2021 2020 (31 765)	1H 2021 (18 724)	(11 229)
	Taxed paid	-	-	-
	Cash flow from operating activities and Depreciation amortization	2 190	1 689	9
Profit before taxes	(31 765) Changes in working capital	(18 724) 1 162	(11 229) (13 041) 2 498	39 165
Taxed paid	- Cash used in operating activities Depreciation and amortization 2 190	- - (28 412) 1 689	- (14 537) 9	27 945 501
Changes in working capital	1 162 good will Investments in	2 498 39 165 159	(1 336) 9	(217)
	Cash used in operating activities (28 412) fixed Investments in assets	(14 537) 27 945 (13 395)	(13 875) (12 981)	(1 168)
	fixed funds in income Investments	(77 347)	12 653	-
Investments in good will Investments in fixed assets	cash used in investment activities Net (13 395)	159 9 (90 583) (12 981) (1 168)	(217) (318)	149 (1 385) (414)
	Investments in fixed income funds Cash flow from financing activities	(77 347) 12 653 -	(90 000)
	Net cash used in investment activities (90 583) lease liabilities Non-current	(318) 1 423	(1 385) (90 265) 1 423
	Capital injection	189 907	4	1 667
	Cash flow from financing activities cash flow from financing activities Net	191 331	428 1	667 1
Non-current lease liabilities Capital injection	1 423 189 907 change cash equivalents Net in	1 423 4 1 667 72 335	189 903 (13 427)	28 227
	Net cash flow from financing activities 191 331 foreign exchange differences Net	1 428 1 667 654	189 903 766	174
	Cash and cash equivalents beginning of period at	28 935	114 585	534
	Net change in cash equivalents 72 335 Cash and cash equivalents end of period at	(13 427) 28 227 101 924	85 763 101 924	28 935

Net foreign exchange differences 654 766 174 (112) Cash and cash equivalents at beginning of period 28 935 114 585 534 28 935 Cash and cash equivalents at end of period 101 924 101 924 28 935 114 585

SHAREHOLDERS

Top 20 shareholders 31.12 Share development

of shares No	Account name	of total %
5 900 000	OLESEN CONSULT HVAC AS	14,48
1 761 720	J.P. MORGAN BANK LUXEMBOURG S.A.	4,32
1 754 715	MONSUNEN FORVALTNING AS	4,31
1 650 000	OLE MORTEN OLESEN	4,05
1 543 371	BEYOND CENTAURI AS	3,78
1 485 860	NORDNET LIVSFORSIKRING AS	3,64
1 360 000	& NESSE CO AS	3,34
1 355 431	LITHINON AS	3,33
1 266 087	Bank DnB NOR ASA	3,11
1 215 275	LIN AS	2,98
1 135 843	ATLE IDLAND	2,79
1 000 000	JAKOB HATTELAND HOLDING AS	2,45
995 109	Bank CACEIS	2,44
958 275	THE NORTHERN TRUST COMP LONDON BRANCH	2,35
883 147	INVESTORE FINANS AS	2,17
819 671	CLEARSTREAM BANKING S.A.	2,01
789 484	MORGAN CHASE LONDON JP BANK N.A	1,93
627 715	SORTUN INVEST AS	1,54
627 715	GLOMAR AS	1,54
560 000	OKS CONSULTING AS	1,37
27 689 418	20 largest shareholders	67,99
40 724 639	Total shares	100,00

Origin of shareholders | largest countries

No of shares	%	Origin	# shareholders
34 142 441	83,84 %	Norway	3 273
3 576 500	8,78 %	Luxembourg	3
2 232 720	5,48 %	UK	12
357 156	0,88 %	Sweden	14
415 822	1,02 %	Others	46
40 724 639	100,00 %	Total	3 348
		Total number of shareholders: 3 348 from 16 countries

AGENDA | H2 2021

H2 2021 REPORT AND FINANCIAL RESULTS | COMPANY PRESENTATION

HIGHLIGHTS AND OUTLOOK

Erling Rasmussen / Tor Karlsen CFO /CTO

FINANCIAL RESULTS

Erling Rasmussen Chief Financial Officer

CAUTIONARY NOTE

DISCLAIMER RELATED TO FORWARD-LOOKING STATEMENTS

By reading this company presentation (the "Presentation") or attending any meeting or oral presentation held in relation thereto, you (the "Recipient") agree to be bound by the following terms, conditions and limitations.

The Presentation has been produced by Desert Control AS (the "Company") for information purposes only and does not in itself constitute, and should not be construed as, an offer to sell or a solicitation of an offer to buy any securities of the Company in any jurisdiction. The distribution of this Presentation may be restricted by law in certain jurisdictions, and the Recipient should inform itself about, and observe, any such restriction. Any failure to comply with such restrictions may constitute a violation of the laws of any such jurisdiction.

The Recipient acknowledges that it will be solely responsible for its own assessment of the Company, the market and the market position of the Company and that it will conduct its own analysis and be solely responsible for forming its own view of the potential future performance of the Company's business. The Company shall not have any liability whatsoever (in negligence or otherwise) arising directly or indirectly from the use of this Presentation or its contents, including but not limited to any liability for errors, inaccuracies, omissions or misleading statements in this Presentation, or violation of distribution restrictions.

The Presentation will be used during an oral presentation and is therefore not a complete summary of the presentation held. Further, it is not the intention to provide, and the Recipient may not rely on the Presentation as providing, a complete or comprehensive analysis of the Company's financial or trading position or prospects. Several factors could adversely affect the business, legal or financial position of the Company or the value of its securities. Such risks include but are not limited to economic and market conditions in the geographic areas and markets where the Company is or will be operating. For a further description of other relevant risk factors, we refer to the Company's information document dated 13 April 2021 and available on the Company's website.

This Presentation contains certain forward-looking statements relating to inter alia the business, financial performance and results of the Company and the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts. Any forward-looking statements contained in this Presentation, including assumptions, opinions and views of the Company or cited from third party sources, are solely opinions and forecasts and are subject to risks, uncertainties and other factors that may cause actual results and events to be materially different from those expected or implied by the forward-looking statements. The Company cannot provide any assurance that the assumptions underlying such forwardlooking statements are free from errors nor do any of them accept any responsibility for the future accuracy of opinions expressed in this Presentation or the actual occurrence of forecasted developments.

This Presentation speaks as at the date set out on herein. Neither the delivery of this Presentation nor any further discussions of the Company shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since such date. The Company does not assume any obligation to update or revise the Presentation or disclose any changes or revisions to the information contained in the Presentation (including in relation to forward-looking statements).

This Presentation is subject to Norwegian law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of Norwegian courts.

DESERT CONTROL COMPANY PRESENTATION

VISION, MISSION & VALUES

OUR PURPOSE | THE REASON WHY WE EXIST AND OUR VALUES

OUR MISSION

• Our mission is to combat desertification, land degradation, and water scarcity
  • Restore and protect vital topsoil
  • Make desert land fertile and arable
  • Reduce water consumption
• To foster climate resilient agriculture, forestry, and green landscapes

Growth-mindset Curious and solution oriented

Innovation Challenge status-quo|create value

OUR VISION

• Our vision is making earth green again
  • Desertification, loss of fertile soil, and growing water scarcity are threats to all life on earth, further accelerated by climate change and overexploitation of natural resources
• What drives us is making earth green again to foster the prosperity of life

Integrity Keep promises|strong relationships

Contribution Desire to make everything better

Diversity Inclusive|open-minded|respectful

POPULATION GROWTH DRIVING INCREASED DEMAND FOR FOOD AND WATER

WATER DEMAND EXPECTED TO EXCEED RELIABLE WATER SUPPLY BY 40% IN 2030

By 2025, 1.8 billion people will experience absolute water scarcity, and 2/3 of the world will be living under water-stressed conditions

UNITED NATIONS HAS DECLARED DESERTIFICATION AND LAND DEGRADATION THE GREATEST ENVIRONMENTAL CHALLENGE OF OUR TIME

110

Countries exposed to desertification and land degradation

1.3Bn

People trapped on degrading agricultural land

12m hectares productive land becomes barren every year

20%

Of Earths drylands degraded

Of agricultural land affected by soil degradation

<60 years

Farming left at current degradation rate

\$490Bn

annual cost world-wide

Source: Global Land Outlook, United Nations Convention to Combat Desertification (UNCCD), http://www.sustainabilitylabs.org

PROBLEM – IMPACT WAY BEYOND THE "TRADITIONAL DESERTS"

70% OF FRESHWATER IN THE WORLD IS USED FOR AGRICULTURE

CURRENT APPROACHES IN AGRICULTURE YIELD LOW WATER EFFICIENCY GAINS

SHARE OF FRESHWATER WITHDRAWLS BY SECTOR (%)

• The shortfall between demand and supply of water is estimated to be 40% by 2030
• Approx. 1/3 of the population will live in areas where the deficit is >50%
• The agriculture industry represents the single largest consumer of water in the world, accounting for ~70% of water withdrawals
  • ‒ Water challenges are therefor closely tied to food provisions and trade

DESERT CONTROL'S LNC TREATMENT IS PART OF THE SOLUTION

ENRICHES THE FERTILITY CAPABILITY IN DESERT SAND – LOWER WATER USAGE AND IMPROVED SOIL HEALTH

1. UNIQUE FORMULATION PROCESS

Clay is processed into a liquid compound

2. SPRAY ON

Applied directly to sand or arid soil

3. EFFECT

Forms a soil structure that retains water like a sponge

4. RESULT

• - 20-50% water and fertilizer savings
• Increased crop yields and carbon uptake

PATENTED PROCESS BASED ON 12 YEARS RESEARCH

LIQUID NATURAL CLAY («LNC»)

Unique nano-technology reduces the clay consumption from 100 kg to less than 1 kg per m2

UNIQUE PRODUCT OFFERING WITH NO DIRECT COMPETITOR

SUBSTITUTES AND OTHER METHODS FOR SOIL ENHANCEMENT ARE INTRUSIVE, TIME CONSUMING AND COSTLY

DESERT CONTROLS LNC PROCESS IS THE ONLY NON-INTRUSIVE SOIL ENHANCEMENT OPTION

INTRUSIVE (mechanical/manual intervention)

Solid form soil amendment

NON-INTRUSIVE (self-percolating into the soil)

Liquid soil amendment

Intrusive soil enhancement treatments are costly, time consuming and to a large extent less effective

PROVEN, VALIDATED AND PATENTED

MULTI-YEAR FIELD TRIALS

EGYPT - BEFORE AND AFTER APPLICATION OF LNC	SCIENTIFIC ACCREDITATION BY ICBA
UAE, AL AIN AFTER APPLICATION OF LNC

THE RESULTS – UAE DESERT EXAMPLE

✓ Less than 1kg of clay per m² ✓ Water and fertilizer savings (20-50%) ✓ Increased crop yields (17-62%) ✓ Improved soil, biodiversity, and carbon uptake

LNC IDENTIFIED AS A POTENTIAL IMPACT SOLUTION BY THE UNITED NATIONS

THE GREATEST CHALLENGE OF OUR TIME: THE GREAT GREEN WALL

RECEIVED OVER \$14 BILLION IN DONATIONS TO REGREEN THE SAHEL – WORLD BANK AMONG DONORS

RESTORE 100 MILLION HECTARES OF DEGRADED LAND

SEQUESTER 250 MILLION TONNES OF CARBON

CREATE >10 MILLION GREEN JOBS IN RURAL AREAS

LIQUID NATURAL CLAY | ESG AND IMPACT POTENTIAL

EXPECTED TO PLAY A VITAL ROLE IN SUSTAINABLE DEVELOPMENT FROM A FINANCIAL AND AN ESG PERSPECTIVE

Stopping deforestation, restoring forests and improving forestry practices could costeffectively remove 7 billion metric tons of carbon dioxide annually – equivalent to eliminating 1.5 billion cars, more than all of the cars in the world today

ESG AND IMPACT

IMPACT ON EXTERNAL ENVIRONMENT AND SUSTAINABILITY

Liquid Natural Clay (LNC) can reduce water consumption for agriculture, forests, and green landscapes by up to 50%. The amount of water required to produce LNC is recovered within 2-3 weeks (offset by irrigation water savings). Increased crop yields with improved water efficiency contribute significantly to the United Nations Sustainable Development Goals (SDGs), including reducing hunger and securing access to clean water. Arid regions using energy-intensive desalination of seawater can further significantly reduce CO2 and greenhouse gas (GHG) emissions.

LNC enables sandy soil and desert land to retain water and nutrients. Reduction of water consumption further allows for reducing fertilizer usage. Reduced leaching of fertilizers and pesticides through the soil can further minimize the risk of chemical run-off reaching through to natural water systems and oceans. Stopping fertilizer and pesticide leaching can further improve life below the water by reducing ocean acidification and eutrophication.

According to the Intergovernmental Panel on Climate Change (IPCC), restoring degraded soil ecosystems can globally offset 5-6 Gt of CO2 annually. Even degraded soils have degrees of stored carbon. When tilling or mechanically working amendments into the ground, carbon exposed to oxygen may turn into CO2 and escape into the atmosphere. LNC can be applied directly to the surface of the ground without intervention to the soil. LNC percolates into the ground in a non-intrusive way without exposing any carbon to surface air oxygen; safeguarding the carbon storage of soil ecosystems and fostering increased carbon sequestration.

Non-intrusive soil treatment is further gentle to fragile soil-ecosystems, which is the home of 95% of all biological species on earth. Reclaiming and protecting soil is therefore critical to preserve and restore essential biodiversity.

Mining clay and the production of LNC requires energy. Logistics and transportation of material, equipment, and personnel, and manufacturing of equipment also require energy. Desert Control strives to reduce energy consumption in all stages of the process and facilitate the use of renewable energy sources wherever available. These negative impact factors are, by far, surpassed by the sum of positive impact from stopping and reversing desertification and soil degradation, reducing water consumption, and other environmental benefits.

LNC has no adverse impact on any of the 17 United Nations Sustainable Development Goals (SDGs). Further, LNC has a significant direct positive impact on 9 of the SDGs.

Powered by operational data, an updated ESG and impact reporting framework will be under development during Q4 to align with ESG reporting standards for investors and stakeholders.

ABOUT DESERT CONTROL

COMPANY OVERVIEW

Desert Control is a company specialized in climate-smart agri-tech solutions to combat desertification, soil degradation, and water scarcity. Its patented Liquid Natural Clay restores and protects soil, reducing water usage for agriculture, forests, and green landscapes.

Liquid Natural Clay (LNC) enables sand and degraded soil to retain water and nutrients. LNC increases crop yields while reducing water and fertilizer consumption by up to 50%.

Desert Control's business model is service-based and targets turnkey projects for LNC treatment of land areas, vegetation, crops, plants and trees etc. LNC is produced on-site at customer locations using mobile factories. Further, the LNC is applied across the customer's land areas using existing irrigation systems and techniques. LNC is sprayed or applied directly onto the surface and percolates into the ground forming a soil structure that retains water and nutrient like a sponge. One LNC treatment may last 3-5 years, followed by periodic top-up to maintain the optimal ability to retain water and nutrients. The Company's revenue model is pre-paid project deliveries direct (B2B) to customers within the segments; agriculture, forestry, and landscaping. Project pricing considers size of land, type of vegetation, crops, number of trees, etc. Additional revenue sources may come from (1) periodic maintenance and (2) digital subscription services related to soil health monitoring, water management optimization, and digital farming services for precision agriculture and sustainable land management.

Desert Control AS is a private limited liability company incorporated under the laws of Norway. The Group has active subsidiaries in Abu Dhabi and Dubai, the United Arab Emirates.

United Arab Emirates is Desert Control's first geographic market, to be followed by broader expansion in the Middle East region. In 2022 the Company aims to expand operations to the United States, focusing on California, Arizona, and Nevada. More than 110 countries worldwide suffer accelerating desertification, loss of fertile soil, and water scarcity. Desert Control's ambition is to develop a global business with its vision of making earth green again.

FINANCIAL RESULTS | H2 2021

CHANGE FROM NORWEGIAN ACCOUNTING POLICY TO IFRS*

Interim, consolidated, unaudited NOK (in thousands)

Increased costs to P&L from GRS to IFRS

All figures in NOK 000's

	2H 2021	1H 2021	Total 2021	2H 2020	1H 2020	Total 2021
share IFRS 2 incentive program	278	533	811	611	997	1 608
R&D IAS 37 to expense	3 766	4 125	7 891	1 828	1 613	3 441
lease immaterial P&L deemed IFRS 16 agreements			-			-
Total	4 044	4 658	8 702	2 439	2 610	5 049
Reported from EBIT GRS	15 800 -	8 739 -	24 539 -	5 048 - -	1 014	6 061 -
change Net	4 044 -	4 658 -	8 702 -	2 439 - -	2 610	5 049 -
Reported from EBIT IFRS	19 844 -	13 397 -	33 241 -	7 487 - -	3 624	11 110 -

*IFRS International Financial Reporting Standards

to foster the prosperity of life

Cultivate and green 1oo Million Hectares of degraded land and desert by 2030

Contribute to sustainable social impact, immense water savings and balanced climate with carbon sequestering

Establish a social impact initiative throughout Sub Sahara by 2025 to reduce poverty and hunger