XXL

Investor Presentation • Feb 9, 2022

XXL ASA – Q4 2021 Presentation of

Financial Results 9 February 2022

Disclaimer

Important notice

The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated ("relevant persons"). Any person who is not a relevant person should not act or rely on this presentation or any of its contents.

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This presentation includes and is based, inter alia, on forward-looking information and contains statements regarding the future in connection with the XXL Group's growth initiatives, profit figures, outlook, strategies and objectives. All forward-looking information and statements in this presentation are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for the XXL Group and its lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions.

Important factors may lead to actual profits, results and developments deviating substantially from what has been expressed or implied in such statements. Although XXL believes that its expectations and the presentation are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the presentation.

XXL is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the presentation, and neither XXL nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.

This presentation was prepared for the interim results presentation for the fourth quarter 2021, held on 9th of February 2022. Information contained herein will not be updated. The following slides should also be read and considered in connection with the information given orally during the presentation.

XXL ASA

– Q4 2021 Great brands Great prices Great assortment Great expertise Great accessibility

Headlines Q4 2021 Solid growth and gross margin improvement – Sweden leading the way

Q4 2021

• Improved seasonal plan and execution
• Strong sales of NOK 2.7 billion (+ 6% vs. 2020)
• Solid gross margin of 42.1% (+ 170bps)
• Improved EBITDA at +23%, ending at NOK 403 million (+ NOK 76 million vs 2020)
• Healthy financial position

2021 total

• Operating revenue of NOK 10.0 billion despite store closures and a challenging delivery situation of especially bicycles
• Strengthened gross margin at 40.8% (+ 330 bps)
• EBITDA of NOK 1 338 million (+ NOK 221 million vs 2020) Norway and Finland with strongest performance in XXL's history, while Sweden has the second-best year

Outlook

• Returning to dividend policy Board proposes a dividend of NOK 0.6 per share
• XXL with strong concept and capabilities to succeed ongoing implementation of strategic initiatives
• Our targets and goals going forward is to continuously gain market shares and strengthen our profitability

Highlights Q4 2021 – strong execution during the "champions league final" of the retail year

• Improved seasonal plan and execution
• Operating revenue of NOK 2 734 million (NOK 2 572 million)
• E-commerce growth of 9%, representing 25.5% of the total revenue for the Group
• Strong gross margin of 42.1%, positively impacted by good price management, together with a disciplined and optimized Black Week campaign. All segments with improvement in gross margins
• EBITDA of NOK 403 million (NOK 327 million)
  • o All segments posting positive development vs. last year

Market share development vs 2020 and 2019

• XXL had slower growth than market in 2021 compared to 2020, partly explained by extraordinary clearance campaign in 2020
• When comparing against 2019, XXL has over the last years gained market shares in Norway and Sweden
• Throughout 2021, had adversely impact from supply chain problems, particularly impacting sales of the large bike category
• XXL's target and goal to gain market shares over time

• Sources: Norway – SSB, Sweden – SCB, Finland – TMA

• XXL Sweden is measured excluding the 3 Outlets stores close to the Norwegian borders

Q4 2021 – Solid performance across all segments

Highlights 2021 – Solid performance despite challenging conditions

Sweden full potential – improved results

Sweden (local currency) Actions Stores - downsizing and renegotiating - closing unprofitable stores Top line - category development and improve assortment - high focus on customer satisfaction - increased conversion Increased marketing efficiency Gross margin improvements from pricing discipline E-commerce - good growth in 2021 and strengthened customer offering in 2022

• selectively open new stores

Market data – source: SCB EBITDA – 2015 to 2018 are not restated

Austria – challenging market conditions and results

Comments

• Challenging market situation during the last two years with several store closures affecting sales negatively
• However, not satisfied with our own performance and several actions initiated to improve the situation
• Ambition to remove negative drag on profits in 2022
• Due to the operational development and situation, it is prudent according to IFRS 16, to impair and write down the right of use assets in Austria => no cash effect

EBITDA (ex. IFRS 16) - Euro

XXL capitalizing on it's strong e-commerce platform with increasingly importance for the business

• XXL being the leading online sports retailer in the Nordic
• In 2021 XXL delivered > 3 500 000 parcels, with a total turnover of almost NOK 2.4 billion
• XXL the no. 1 site for Sports & Outdoor in the Nordics. 150 million online sessions (online store visits) in 2021
• XXL continue to invest in order to improve omni-channel solutions
• EVP Digital Commerce is recruited and a part of the senior management team
• XXL has an ambitious growth strategy for e-commerce

4

Supply situation "under control"

• Given high uncertainties and challenges throughout the value chain (freight, production, supplies, raw material) we are monitoring suppliers and deliveries closely
• Key challenges are specially related to production of shoes and textile in Asia where factories have been closed for a period of time during fall 2021
• Global transportation setup is still struggling with delays both from Asian harbors and congestion in European harbors
• XXL has many different suppliers and have diversified the delivery risk to some extent
• Well prepared for the upcoming bike season

3

Great contribution from all of our employees in Q4 and 2021

• 2021 was another year impacted by covid-19 with several store closures, challenging delivery situation and constantly changing restriction
• Despite this our employees have made an impressive effort
• Thank you!

Financial Review Q4 2021

Key Figures

(Amounts in NOK million)	Q4 2021	Q4 2020	FY 2021	FY 2020 Audited
GROUP
Operating revenue	2 734	2 572	10 006	10 423
Growth (%)	6 3 % ,	10 9 % ,	-4 0 % ,	15 9 % ,
Gross profit	151 1	1 040	4 084	3 904
Gross margin (%)	42 1 % ,	40 4 % ,	40 8 % ,	37 5 % ,
OPEX %	27 3 % ,	27 7 % ,	27 4 % ,	26 7 % ,
EBITDA	403	327	1 338	1 117
EBITDA margin (%)	14 % ,7	12 % 7 ,	13 4 % ,	10 % 7 ,
EBIT	4 2	133	391	364
EBIT margin	1 5 % ,	2 % 5 ,	3 9 % ,	3 % 5 ,
Impairment losses	136	-	136	-
EBIT adj	177	133	527	364
EBIT adj margin	6 5 % ,	2 % 5 ,	5 3 % ,	3 % 5 ,
Net Income	3	13	194	126
Net Income adj	139	13	330	126
(NOK) Basic Earnings per share	0 01 ,	0 05 ,	0 ,77	0 57 ,
(adj) Earnings per share	0 55 ,	0 05 ,	1 31 ,	0 57 ,

• Revenue up with NOK 161 million vs. last year
  • Positive like for like growth of 9.4%
  • Good weather conditions in the Nordics and improved campaign execution
  • E -com growth of 8.5% - representing 25.1% of total revenue versus 25.0% last year
• Gross margins ended at 42.1%, up from 40.8% last year
  • Impacted by good price management, together with disciplined and optimized Black Week campaign
  • Release of obsolete accruals
• OPEX in % is 0.4 p.p lower than last year driven by the higher top line giving scale in operations
• EBITDA ending at NOK 403 million
  • 2021 EBITDA of NOK 1 338 million
  • 2021 EBITDA ex. IFRS of NOK 737 million
• Impairment of right of use assets in Austria – resulting in a write down of NOK 123 MNOK. Also a write down of assets related to the two outlet stores in Sweden of NOK 13 million
• Adjusted net income of NOK 139 million in Q4 2021

Gross Margin Development

XXL ASA Q4 2021 - Gross margin per segment (in %)

• Strengthened gross margin development in the quarter, up from 40.4% in Q4 2020 to 42.1% in Q4 2021
• Improved campaign execution and planning
• All markets with gross margin improvement, partly affected by release of obsolete accrual due to healthier inventory:
  • Norway: NOK 11 million
  • Austria: NOK 4 million
• XXL targets to stabilize the gross margin above 39%- Improved market dynamics
  • Improved campaign approach and execution
  • Healthier assortment and inventory levels

OPEX Development

• Group OPEX% down with 0.4 points to 27.3% in Q4, explained by higher revenue positively affecting scale in operations
• Increase of NOK 34 million vs. LY, partly explained by new store openings and late arrival of goods to central warehouses. Also increased sick leave in stores due to pandemic
• Counteracted by lower bonus accruals and reduced consultancy cost

EBITDA Development

XXL ASA Q4 2021 - EBITDA per segment (in mNOK)

• Positive EBITDA development vs LY up NOK 76 million explained by the revenue growth and increased gross margins
• All segments posting improved EBITDA in the quarter vs. LY
• EBITDA margin of 14.7% in Q4 2021 vs. 12.7% in Q4 2020

Inventory is now at healthy levels

2019-2020: restated figures

Net Debt Development

Continued strong financial position

XXL has a solid balance sheet

Financial summary Q4 2021

P&L Summary

• EBITDA of NOK 403 million vs. LY of NOK 327 million
• Increase in revenue vs. LY of NOK 161 million, explained by good weather conditions and improved campaign execution
• Strong gross margins in the quarter of 42.1%
• Impairment of Austrian stores and Swedish Outlet stores=> write down of right to use and fixed asset of NOK 136 MNOK => no cash effect

Balance sheet summary

• Inventory healthy levels and age
• Continued strong financial position
  • NIBD of NOK 707 million
  • Liquidity reserves of NOK 1.093 million
• The Board of Directors will propose a dividend payment for the year 2021 of NOK 0.6 per share

Outlook

We have maintained and accelerated progress on our key strategic initiatives throughout 2021

Our targets and goals going forward is to continuously gain market shares and strengthen our profitability

Our ambition is market share gains in all markets and continue the growth within the ecom channel

Market share growth Improve gross margin Decrease cost-ratio

We target to strengthen and improve our gross margin further from the stabilized 2020 levels (> 39% in gross margin)

We continue to invest in improved operational efficiency to decrease the cost ratio and increase quality

Dividend target of 40-50% of annual normalized net income

Strengthening cooperation and digital capabilities

• Sebastian Blom - new EVP Digital Commerce

• he is already onboard and has extensive experience from XXL and e-commerce operations
• will be responsible to deliver on an ambitious e-commerce growth plan
• part of the executive management team reporting to CEO

• Andre Sjåsæt – new EVP Marketing and Category

• will improve and strengthen the cooperation between the commercial departments
• continue the journey of improving marketing efficiency and category development
• XXL has started the recruitment process of a new EVP Strategy and Business Development

Closing remarks

Q4 2021 Key Takeaways Priorities Going forward

• Improved seasonal plan and execution
• Strong sales at 2.7 billion (+ 6% vs. 2020)
• Strong gross margin at 42.1% (+ 170bps)
• Strong EBITDA at NOK 403 million (+ NOK 76 million vs 2020)

• Solid financial position

• Category strategies and seasonal execution

• Marketing and campaign process optimization
• E-commerce growth
• Optimize inventory and cost base

• Continue execution of improvement program
• Gain market shares in all markets
• Stabilize gross margin above 39%
• 3 new stores signed for 2022, 1 in Norway and 2 in Sweden. Töcksfors and Nordby to close during 2022
• Remove loss in Austria
• Decreased sales in January 2022 (-20%) vs. a strong comparator LY, but 20% growth vs. January 2020

Q&A

XXL ASA – Q4 2021

Appendix

Q4: Norway and Sweden

• Positive development in topline vs a strong comparator, driven by strong Christmas sales and improved campaign execution
• Higher gross margin is explained by better campaign activities and seasonal execution, also impacted by a release of obsolete accrual of NOK 11 million
• EBITDA of NOK 329 million (NOK 319 million)

• Positive development in topline (local currency), driven by a positive like for like growth of 18.9 percent in local currency.
• Higher gross margin is explained by improved seasonal execution under good market conditions
• Opex% better than LY due to positive like for like for growth
• EBITDA ending at SEK 122 million (SEK 75 million)

Q4: Finland and Austria

• Positive development in topline of 8.2%, driven by a positive like for like. Sales gradually improved during the quarter with favorable winter conditions and solid Christmas sales
• Higher gross margin is explained by favorable market conditions
• EBITDA of EUR 7.5 million (EUR 6.3 million)

• Positive development in topline of 8.3%. More challenging market dynamics than in the Nordic countries post covid-19
• Higher gross margin is partly explained by a release of obsolete accrual of NOK 4 million
• Negative development in opex% explained by more stores and increased marketing costs
• EBITDA of EUR 0.4 million (negative EUR 0.1 million)

All sports united. Sports unite all.