Magnora ASA

Earnings Release • May 26, 2020

Magnora ASA: Q1 2020 Report – Electric Future

Magnora ASA: Q1 2020 Report – Electric Future

Oslo, Norway, 26 May 2020: MAGNORA ASA, a leading Norwegian renewable energy investment company releases first quarter 2020 results.

Main events in the quarter:

• This year started off with Magnora entering the renewable market with two investments within the wind project development segment. Magnora’s management team worked closely with the board in 2019 to set a new direction for the company within green investments, and our strategy was launched in February this year. Going forward, Magnora will invest and develop companies and projects within the renewable energy space, and the initial focus is on wind projects abroad and some selective sites in Norway where there is demand for wind energy. Our largest shareholders have been very supportive of our initial investments and have all along encouraged a green investment strategy as a new direction for the company going forward. The Company is initially concentrating on mature greenfield to close to ready-to-build projects. Our strategy requires deep industry experience with in-house due diligence, site identification skills, as well as project management, procurement, operations, and exit competence. With the engagement of Haakon Alfstad and Theis Hanang Pedersen at the end of 2019, we have a Magnora executive team that brings decades of experience with proven operating and project execution experience to the company. With our two investments within the wind sector this quarter, we have an expanded team of 8 wind specialists with over 100 years of experience in the wind project development market in Norway, Sweden, Germany, Scotland, England, and the US. Combined, the team has led processes that have resulted well over NOK 50 billion of investment in the sector.

• On March 6, Magnora announced an investment in the “Vindr Group,” with a right to further increase our holdings to 50%. Vindr is a company based in Norway and Sweden which focuses on early stage wind opportunities. Vindr is concentrating on small and medium sized wind development projects in the region close to cultivated land. Vindr has made good progress in March and April and is delivering according to the company’s business plan. Haakon Alfstad is the company’s Executive Chairman and works closely with the Vindr team. Vindr expanded its leadership team in March with the recruitment of Kristian Hauglum, who has been 17 years with Norsk Hydro in wind development, where his responsibilities included strategy development and Power Purchasing Agreements (PPAs). We are very pleased to learn that Kristian Hauglum joined the Vindr team.

• On March 20, Magnora announced an investment in a 500 MW shallow water project in Northern Europe. We are pleased to announce the name of the company today: Kustvind AB. Kustvind has a highly attractive project in the southern part of Sweden. The team of founders have a great track record with development of wind power projects over the last 25 years (over 2.500 MW). The project is already far ahead of our initial plans from the due diligence process. Haakon Alfstad is the company’s Executive Chairman and works closely with the Kustvind team. The project’s initial feasibility study will be finalised over the next months as opposed to April 2021 as originally planned. The project is located in an area with excellent wind conditions, close to infrastructure, and with attractive electricity prices. In addition, there is specific demand for green electricity from various industries and house builders in that part of Scandinavia. Magnora has a right to acquire up to 50% of the company through a gradual milestone based investment plan.

• On March 16, Magnora made a cash distribution of NOK 0.25 per share, which was authorised by the AGM held on 21 May 2019. The cash distribution was a repayment of paid-in capital in excess of the par value of the Magnora share. After this distribution, the Company has returned NOK 512.8 million (NOK 9.75 per share) to its shareholders since the sale of its business to Sembcorp in Q4 2018.

• Adjusted EBITDA, as defined in note 1, was NOK 6.2 million (NOK 7.0 million), a decrease of NOK 0.8 million versus the previous quarter. The main driver for the decrease was an increase in the operating expenses as set out below.

• Operating cost for the quarter excluding one-off items was NOK 2.7 million, which is an increase of NOK 0.9 million compared to the previous quarter. The increase was mainly due to higher personnel expenses as a result of the additional two executives engaged to assist with building the wind energy business, audit fees related to the annual accounts, and additional legal fees associated with the two acquisitions during the quarter.

• Revenue for the quarter was NOK 8.9 million. Net profit for the quarter was NOK 2.4 million, which is a decrease of NOK 3.9 million compared to the previous quarter. The decrease was mainly due to the increase in operating expenses as explained above, and a net loss in financial items.

• Based on the acceleration of our investments as part of our new strategic direction, we will reduce quarterly return by approximately two thirds to NOK 0.08. The reduction has been encouraged and supported by our largest shareholders. We plan to return with a fine-tuned business plan after we have finalized the review of our current, growing deal-flow and partnerships. We estimate that our next quarterly capital distribution will be in July 2020.

• After the end of the quarter we have further entered into two LOI’s in the UK and Northern Scandinavia which we look firming up into concrete projects.

About Magnora (OSE: MGN): Magnora ASA is a renewable energy investment company looking for profitable green investment opportunities. The company is listed on the main list on Oslo Stock Exchange under the ticker MGN.

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For further information, please contact:

Erik Sneve, CEO, Magnora ASA

es@magnoraasa.com

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.