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Sonaecom SGPS

Interim / Quarterly Report Nov 29, 2021

1921_10-q_2021-11-29_819d4efe-3df4-47e9-b1e7-32a106e19384.pdf

Interim / Quarterly Report

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SONAECOM

MANAGEMENT REPORT & ACCOUNTS

9M21

The consolidated financial information disclosed in this report is based on unaudited financial statements, prepared in accordance with the
International Financial Reporting Standards (IAS/IFRS), issued by the Internationa Union.

Table of contents

I MANAGEMENT REPORT
1. Main Highlights 3
2. Sonaecom Consolidated Results 3
2.1 Telecommunications 5
2.2 Technology 5
2.3 Media 8
3. Subsequent Events 8
4. Appendix 9
II FINANCIAL STATEMENTS
5. Financial Information 12
5.1. Sonaecom condensed consolidated financial statements 12
5.2. Notes to the condensed consolidated financial statements of Sonaecom 17

I-MANAGEMENT REPORT

MANAGEMENT REPORT & ACCOUNTS 2021

1. Main Highlights

Consolidated Turnover increasing 5.5% to 53.7 million euros, with positive contributions from all portfolio companies.

Strong EBITDA performance, achieving 46.2 million euros. The capital gains generated with the partial sale of the Arctic Wolf stake, the sale of CB4 stake and the sale of Bizdirect, coupled with an improvement of ZOPT equity results and a profitability improvement across all Sonaecom business units, led to this impressive growth.

NOS presenting an acceleration of Telco operating performance and a recovery of Cinemas and Audiovisuals segment. 3Q as the highest quarter in terms of RGUs net growth in the last 5 years.

Net income (Group Share) reached 67.9 million euros, clearly above 9M20 and reflecting not only the positive performance at EBITDA level but also the portfolio valuations recorded at indirect results.

Capital Structure remains strong with a net cash position of 204.6 million euros.

2. Sonaecom Consolidated Results

Introductory notes:

In the 1H21, and following the agreement signed with Claranet Portugal, S.A. to sell the entire share capital and voting rights of Bizdirect, which was announced on June 1st, Bizdirect was considered a discontinued operation. In the 3Q21, on July 16th, this transaction has been completed, following the approval from the competent authority and the verification of the conditions precedent agreed between the parties. All comparative periods were restated to include Bizdirect results as a discontinued operation in the profit and loss statement.

Telecommunications area, which includes a 50% stake in ZOPT - consolidated through the equity method - which owns 52.15% stake in NOS, presented a positive financial evolution, accelerating Telco operating performance and recovering in Cinema & Audiovisuals segment with the return of spectators to cinema theatres.

On Telco area, RGUs net growth in the quarter reached the greatest level in the past five years and both residential and B2B segments presented positive revenues evolution, the last one driven by strategic partnerships and the launch of innovative IT, data and cloud solutions. On Cinema & Audiovisuals business, with the gradual easing of confinement measures in the summer and the return to the big screen of long-anticipated blockbusters, the audience in movie theatres began to increase month after month.

Investment levels continued to reflect the strategy of being leader in new generation networks, deploying FttH and preparing mobile network for 5G launch.

Finally, it is important to highlight that already in October and after more than 200 days of bidding, the auction for the allocation of the 5G frequencies ended, with NOS winning the largest fraction of the spectrum released and acquiring spectrum in all possible bands.

Regarding portfolio activitu, Technology area (i) sold part of its stake in Artic Wolf for a gross amount of 36.4 million euros with a gross capital gain of 12.3 million euros; (ii) entered in the share capital of Sellforte, a SaaS platform that measures the effectiveness of online and offline marketing investments; (iii) invested in Portainer.io, one of the mo voting rights of Bizdirect to Claranet Portugal, S.A., with a gross capital gain of 5.4 million euros; (ii) sold its stake in CB4 with a gross capital gain of 5.1 million euros; (iii) entered in the share capital of Citcon, a US- based leading mobile wallet payment provider, and (iv) reinforced its ownership in some portfolio companies.

9M21 was also marked by relevant achievements in some of its minority investments indirectly held through Armilar funds: i) Feedzai, that announced a series D round with an implicit valuation that turned the company into an unicorn; ii) Outsystems announced a 150 million dollars capital raise, co-led by Abdiel Capital and Tiger Global, at an underlying valuation of 9.5 billion dollars; and (iii) Safetypay that is expecting some regulatory approvals, to be acquired by Paysafe with an implicit valuation of 441 million dollars. Regarding Arctic Wolf, the company announced a financing round of 150 million dollars by existing and new investors, at an underlying valuation of 4.3 billion dollars. The rounds of Outsustems and Arctic Wolf are a good sign of the companies' strong evolution and potential.

Turnover

Consolidated turnover in 9M21 reached 53.7 million euros, increasing 5.5%, when compared to 9M20. This positive evolution was driven by both Media and Technology area, the latter presenting a growth of 6.4% y.o.y..

Operating costs

Operating costs amounted to 60.4 million euros, 6.7% above 9M20. Employee benefits expenses increased 8.0% and Commercial costs decreased 1.6% to 11.1 million euros, mainly driven by the lower cost of goods sold, aligned with the lower level of Sales. Other expenses increased 10.6%, mainly explained by the higher level of Outsourcing costs.

EBITDA

Total EBITDA increasing from 8.0 million euros to 46.2 million euros, mainly explained by non-recurrent itens and by the increase on equity results but also driven by portfolio profitability improvements.

In 9M21, the non-recurrent itens stood at 21.2 million euros, mainly driven by the capital gains generated with the sales of Arctic Wolf, CB4 and Bizdirect. In 9M20, the non-recurrent items stood at negative 9.6 million euros, mainly driven by the gross capital loss as a result of the redemption of participation units held in the Armilar Venture Partners II Fund.

The equity results, mostly driven by ZOPT contribution which, in turn, depends on NOS net income evolution, increased to 28.6 million euros.

Underlying EBITDA benefiting from positive evolutions in both Media and Technology area.

Net results

Sonaecom's EBIT increased to 40.8 million euros, from 1.6 million euros in 9M20, explained by the higher level of EBITDA and the lower level of depreciations.

Sonaecom's earnings before tax (EBT) increased from 0.9 million to 41.0 million euros, driven by the higher EBIT and financial results. Indirect results reached 29.5 million euros, positively impacted by portfolio fair value adjustments, specially at Armilar Venture Funds, mainly related with Feedzai and Safetypay. The amount of 22.4 million euros in 9M20, is mainly related with Arctic Wolf upward required the matter of the company into a unicon-

Net results group share stood at 67.9 million euros, above the 28.7 million euros presented in 9M20.

Operating CAPEX

Sonaecom's operating CAPEX increased to 4.4 million euros, reaching 8.1% of Turnover, 1.2 p.p. above 9M20. Excluding the IFRS 16 impact, operating CAPEX would be 2.2 million euros, 0.3 million euros below 9M20.

Capital Structure

The net cash position stood at 204.6 million euros, and excluding the decrease generated by the amount of liquidity already allocated to assets held for sale (Bizdirect), stood 2.1 million euros below the level of December 2020. Excluding leasings, net cash position stood at 217.9 million euros, 3.3 million euros below December 2020, mainly driven by 34.9 million euros of positive net inflow from investment activity, the 29.7 million euros of dividends distribution and the negative operating cash-flow, financials and taxes of 7.0 million euros.

2.1 Telecommunications

NOS operating revenues were 1,044.9 million euros in 9M21, increasing 3.1% y.o.y.. EBITDA reached 477.7 million euros, increasing 1.4% when compared to 9M20 and representing a 45.7% EBITDA margin. CAPEX excluding leasings amounted to 310.1 million euros in 9M21, an increase of 15.0% u.o.y. As a consequence of EBITDA and CAPEX evolution, EBITDA- CAPEX decreased 16.8%.

At the end of 9M21, total net debt including leasings and long-term contracts (according to IFRS 16) amounted to 1,431.3 million euros. Net Financial Debt/EBITDA after lease payments (last 4 quarters) now stands at 1.7x EBITDA, and with an average maturity of 2.4 years.

NOS published its 9M21 results on 3rd November 2021, which are available at www.nos.pt.

During 9M21, NOS share price increased 21.7% from €2.858 to €3.478, whilst PSI20 increased by 11.5%.

Operational Indicators

Million euros
Operational Indicators ('000) 3020 3021 $\triangle$ 21/20 2021 a.o.a. 9M20 9M21 ∆ 21/20
Total RGUs 9.871.8 10.147.1 2.8% 10.000.2 1.5% 9.871.8 10.147.1 2.8%
Convergent + Integrated RGUs 4.890.7 5.146.3 5.2% 5.060.5 1.7% 4.890.7 5.146.3 5.2%

Financial indicators

Million euros
NOS HIGHLIGHTS 3020 3Q21 $\triangle$ 21/20 2021 q.o.q. 9M20 9M21 △ 21/20
Operating Revenues 346.9 366.5 5.6% 341.0 7.5% 1.013.6 1.044.9 3.1%
EBITDA 160.6 171.1 6.6% 154.4 10.8% 471.2 477.7 1.4%
EBITDA margin (%) 46.3% 46.7% 0.4 pp 45.3% 1.4pp 46.5% 45.7% $-0.8$ pp
Net Income 44.1 46.1 4.6% 43.3 6.5% 79.1 120.0 51.7%
CAPEX excluding Leasings 97.8 110.0 12.4% 104.1 5.6% 269.6 310.1 15.0%
EBITDA-CAPEX excluding Leasings 62.8 61.2 $-2.6%$ 50.3 21.7% 201.6 167.7 $-16.8%$

2.2 Technology

The Technology area aims to build and manage a portfolio of technology businesses around retail and telecommunications, as well as cubersecuritu, with an international scale. This area currently comprises, alongside with minority stakes, Bright Pixel, Vector I and Bright Innovation funds, three controlled companies - S21Sec and Excellium (together the Maxive Cybersecurity Group) and Inovretail - that generated more than 85% of its revenues outside the Portuguese market with 80.4% out of the total 598 employees based abroad.

In terms of operational performance, Sonae IM continues to record improved top line and underlying EBITDA. In 9M21, total turnover increased by 6.4% y.o.y to 43 million euros and underlying EBITDA improved by 6.0%.

Controlled Companies

Maxive Cybersecurity is the strategic holding company that combines two of the leading cybersecurity pure players in Europe and is positioned as one of the largest MSSPs (Managed Security Services Provider) pure players both in terms of business and specialized personnel offering its customers a wide set of services combining best practices and capabilities from both S21sec and Excellium:

S21Sec is a reference multinational MSSP, focused on the delivery of cyber security services and development of proprietary supporting technologies, with a global customer base, leveraging its teams in Spain, Portugal and Mexico. Since June 2018, with the integration of Nextel, S21Sec is the most relevant "pure player" (company specializing exclusively in the cubersecurity sector) in Spain and Portugal in terms of turnover and number of cubersecurity experts.

Excellium is a market-leading managed security services provider from Luxembourg, with presence in Belgium and counting with more than 100 experts.

The significant European scale and cross-country presence of this group of cybersecurity companies will be key to address the increasingly challenging needs of all organizations and specially the requirements of those large and multi-national companies operating in the European space, while ensuring agile and fast response from specialized teams close to the customer.

InovRetail is a retail innovation company that provides data science solutions and digital tools that deliver quantifiable insights and actionable recommendations with direct and sustainable impact on retailer's key metrics. The company's main product is the Staff Empowerment Solution, a SaaS based solution that help retailers in three key areas like Sales Performance Enhancement; Customer Experience Optimisation and Advanced Planning & Scheduling.

Minority Stakes (non-exhaustive)

Armilar Venture Funds are the 3 Venture Capital funds in which Sonae IM owns participation units acquired to Novo Banco. With this transaction, concluded in December 2016, Sonae IM reinforced its portfolio with sizeable stakes in leading edge companies such as Outsystems and Feedzai, both consistently presenting meaningful and sustainable levels of growth.

Arctic Wolf, a US based company, is a global pioneer in the SOC-as-a-Service market with cutting-edge managed detection and response (MDR), which provides a unique combination of technology and services for clients to quickly detect and contain threats. Sonae IM, jointly with US technology investors Lightspeed Venture Partners and Redpoint, entered in the company's cap table in 2017 in a series B round. During 2018, the Company closed a \$45M series C round and, at the end of 2019, the Company launched a \$60M Series D round. In October 2020, the company announced it has raised \$200 million in Series E funding at a valuation of \$1.3 billion. The funding round was led by Viking Global Investors, with additional participation from DTCP and existing investors. Sonae IM participated in all rounds, reinforcing its stake.

Stylesage is a strategic analytics SaaS platform that helps fashion, home and beauty retailers and brands with critical pre, in and post season decisions globally. Every day, StyleSage pulls product data from competitors' ecommerce websites from around the world. Then, with groundbreaking technology in machine learning and visual recognition, StyleSage cleans, organizes, and analyzes the massive amounts of collected data into a cloud-based dashboard that empowers brands and retailers to make informed, data-driven decisions in areas such line planning, markdown optimization, and global expansion.

Ometria is a London based AI powered customer marketing platform with the vision to become the central hub that powers all the communication between retailers and their customers. This investment was done by Sonae IM in the Series A round, alongside several strategic investors (including Summit Action, the US VC fund of the Summit Series) and was reinforced during series B round.

Reblaze is an Israeli company that provides proprietary security technologies in a unified platform, shielding assets from threats found on the Internet. The company raised a Series A round in which Sonae IM led jointly with JAL Ventures and Data Point Capital.

Visenze is a Singapore-based company that delivers intelligent image recognition solutions that shorten the path to action as consumers search and discover on the visual web. Retailers use ViSenze to convert images into immediate product search opportunities, improving conversion rates. Media companies use ViSenze to turn any image or video into an engagement opportunity, driving incremental revenue. Sonae IM co-led, with Gobi Partners, a S20M Series C round to enable the artificial intelligence company to further invest in its penetration among smartphone manufacturers, as well as with consumer and social communication applications.

Daisy Intelligence is an Al-powered platform for retail merchandising teams focused on optimizing promotional product and price mixes for dramatically improved business results. Sonae IM partnered with Framework Venture Partners invested in a C\$ 10M (circa €7M) series A round.

Nextail is a Spanish company that has developed a cloud-based platform that combines artificial intelligence and prescriptive analytics to upgrade retailers' inventory management processes and store operations. The company raised a \$10.0 million Series A round led by London and Amsterdam based venture capital firm KEEN Venture Partners LLP ("KEEN"), together with Sonae IM and existing investor Nauta Capital. The new financing was to be used to accelerate product development and double the size of the team, as it grows internationally.

Sixgill is a market leader in deep and dark web cyber threat intelligence. Sixgill helps Fortune 500 companies, financial institutions, governments, and law enforcement agencies protect their finances, networks and reputations from cuberthreats that lurk in the deep, dark and surface webs. The advanced cuber threat intelligence platform automates all phases of the intelligence cycle - collection, analusis and dissemination of data - providing organizations with unparalleled information and actionable insights to protect their various assets in the ever-evolving cyber threatscape. Sixgill raised \$15M in a second round led by Sonae IM and REV Venture Partners with participation by Our Crowd. Previous investors Elron and Terra Venture Partners also participate in the round.

Case on IT is a Spanish company that has developed Medux, a machine learning solution for the measurement, prediction and analysis of landline, mobile and television services quality. Medux measures the customer experience in markets that collectively serve over 600 million users worldwide.

CiValue is an Israeli company with offices in New York, Paris, and Tel Aviv, is a disruptive provider of cloud-based Precision Marketing and Supplier Advertising Platforms for Retailers. Sonae IM, coupled with Nielsen, led a S6M Series A investment.

Cellwize is a leading provider of Mobile Network Automation and Orchestration solutions for telco, based in Israel. Cellwize offers modular solutions for an agile adoption of 'zero-touch' network automation capabilities on top of a virtualized service orchestration platform. It supports network operations, especially given the increase in network density and complexity driven by 5G adoption. Sonae IM invested in a round of \$15M led by Deutsche Telekom Capital Partners. In November 2020, the company announced a \$32 million Series B funding round led by Intel Capital and Qualcomm Ventures LLC with participation from Verizon Ventures, Samsung Next, and existing shareholders.

IriusRisk (previously named Continuum Security) is a Spanish based company with an application security platform to address vulnerabilities early in the development process. In order to realise their international growth plans, the company has raised an investment round of 1.5 million euros, which was led by Swanlaab Venture Factory and joined by JME Venture Capital and Sonae IM. In September 2020, the company raised a series A round of 6.7 million dollars participated by Paladin, 360 CP, Swanlaab JME Venture Capital and Sonae IM.

Jscrambler is a Portuguese startup that develops a security solution to protect Web and Mobile Applications (Javascript code). In 2018, the company raised a 2.3 million dollars in a financing round that was led by Sonae IM with the co-investment of Portugal Ventures. In 2021, the Company raised 10 million euros in a series A with the participation of Ace Capital Partners.

Probe.ly, having started as an internal project of Bright Pixel, won the Caixa Capital Empreender Award 2017, has stepped from MVP (Minimum Valuable Product) to an independent Web Application Security startup.

Sales Layer is a Spanish based company with a cloud-based Product Information Management (PIM) platform, helping brands and retailers to transform their catalogs into a digital, enriched and multichannel control center. Sonae IM recently led its series A round.

Deepfence is a leading US-based cloud-native workload protection platform that aims to provide a unified security platform for kubernetes, virtual machines and serverless workloads. Deepfence ensures business continuity in the face of persistent threats by detecting and disrupting sophisticated attacks targeting cloud-native technologies, the "glue" that keeps the current world connected. Deepfence raised \$9.5 million in Series A financing led by AllegisCyber, with participation from Sonae IM, and existing investor Chiratae Ventures.

Weaveworks is a US company that helps teams to adopt cloud native computing, managing cloud native infrastructure and applications quickly, reliably and at scale. Weaveworks announced a \$36.65 million Series C funding round led by some of the world's leading public cloud and telecommunications companies, including first-time investors Amazon Web Services (AWS), Ericsson, Orange Ventures, Sonae IM and Telekom Investment Pool (TIP). The round also included follow-on investments from Accel, GV, and Redline Capital.

Sellforte, based in Helsinki, Finland, is a SaaS platform for Retailers, Brands and Telcos, which uses proprietary data science and AI to measure the effectiveness of online and offline marketing investments.

Portainer.io, based in New Zealand, is one of the most popular container management platforms globally. Portainer's universal tool unleashes the power of containerized applications for everyone.

Citcon, is a US-based leading mobile wallet payment provider with a fintech platform that enables seamless global commerce at scale bu connecting the world's businesses with more than 100 mobile wallets, local and alternative paument methods. Citcon raised \$30 million in Series C financing led by Norwest Venture Partners and Cota Capital with the participation of Sonae IM and Sierra Venture.

2.3 Media

Público continued to consolidate its position as the reference Portuguese speaking news organization focused on a digital strategu, reinforcing digital competencies and presence in online platforms.

The bet on the quality of journalism, combined with an innovative and digital image, has reinforced Público's prestige with direct positive impacts not only in the number of subscribers and online users but also in the increasing value of the brand in the advertising market. During the last 9 months, digital revenues increased more than 20% and already represent 35% of total revenues, with strong performances in both subscriptions and advertising revenues. This positive performance contributed to a positive evolution at EBITDA level.

3. Subsequent Events

On October 27th, the auction for allocation of 5G frequencies came to an end, with NOS winning the largest fraction of the spectrum released and investing the highest value of all the participants. This completely fulfils all the objectives outlined in NOS' strategy for the fifth generation of mobile networks.

4. Appendix

Consolidated income statement

Million euros
CONSOLIDATED INCOME STATEMENT 3020 R 3021 $\triangle$ 21/20 2021 q.o.q. 9M20R 9M21 $\triangle$ 21/20
Turnover 18.0 17.9 $-0.2%$ 19.0 $-5.6%$ 50.9 53.7 5.5%
Services Rendered 11.6 12.6 9.0% 13.1 $-3.8%$ 34.4 37.7 9.4%
Sales 6.4 5.3 $-16.9%$ 5.9 $-9.5%$ 16.5 16.0 $-2.7%$
Other Income 0.3 0.5 62.2% 0.5 $-6.3%$ 1.4 $1.6\,$ 11.2%
Operating Costs 19.2 19.7 2.6% 22.5 $-12.4%$ 56.6 60.4 6.7%
Employee Benefits Expenses 10.3 11.1 7.2% 12.4 $-10.3%$ 31.2 33.7 8.0%
Commercial Costs (1) 4.5 3.7 $-18.7%$ 4.2 $-12.6%$ 11.3 11.1 $-1.6%$
Other Expenses (2) 4.4 5.0 13.5% 6.0 $-16.5%$ 14.1 15.6 10.6%
EBITDA 0.6 20.2 $\overline{a}$ 19.8 2.2% 8.0 46.2
Underlying EBITDA (3) $-0.8$ $-1.2$ $-45.2%$ $-1.4$ 15.5% $-3.8$ $-3.5$ 7.8%
Non recurrent itens $-9.2$ 10.4 10.8 $-3.4%$ $-9.6$ 21.2
Equity method (4) 10.7 11.0 2.9% 10.7 3.5% 21.1 28.6 35.2%
Discontinued Operations (5) 0.0 $0.0\,$ 100.0% $-0.2$ 100.0% 0.3 $-0.1$
Underlying EBITDA Margin (%) $-4.7%$ $-6.8%$ $-2.1$ pp $-7.6%$ 0.8 pp $-7.5%$ $-6.6%$ 0.9 pp
Depreciation & Amortization 2.1 1.6 $-21.4%$ $1.8\,$ $-10.5%$ 6.4 5.3 $-16.4%$
EBIT $-1.4$ 18.6 18.0 3.5% 1.6 40.8
Net Financial Results $-0.2$ $-0.1$ 53.6% 0.1 $-0.6$ 0.2
Financial Income 0.4 0.6 57.4% $-0.3$ 2.0 0.9 $-53.8%$
Financial Expenses 0.5 0.6 21.4% $-0.3$ 2.6 0.8 $-70.9%$
EBT $-1.6$ 18.5 18.1 2.6% 0.9 41.0
Tax results 2.5 $-0.8$ $\sim$ $-2.8$ 70.4% 4.1 $-3.2$
Direct Results 0.9 17.7 $\blacksquare$ 15.3 16.1% 5.0 37.8
Indirect Results (6) 24.5 10.5 $-57.2%$ 13.6 $-22.6%$ 22.4 29.5 31.4%
Net Income 25.4 28.2 11.0% 28.8 $-2.1%$ 27.5 67.3 144.8%
Group Share 25.7 27.9 8.6% 29.4 $-4.9%$ 28.7 67.9 136.5%
Attributable to Non-Controlling Interests $-0.3$ 0.3 $-0.6$ $-1.2$ $-0.6$ 49.4%

Franchiscore Coronal Controller Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Coronal Corona

Consolidated balance sheet

Million euros
CONSOLIDATED BALANCE SHEET 3Q20 R 3021 $\triangle$ 21/20 2Q21 q.o.q. 9M20R 9M21 $\triangle$ 21/20
Total Net Assets 1,191.3 1,249.1 4.9% 1,231.9 1.4% 1,191.3 1,249.1 4.9%
Non Current Assets 910.9 984.3 8.1% 955.9 3.0% 910.9 984.3 8.1%
Tangible and Intangible Assets and Rights of Use 19.2 18.4 $-4.1%$ 18.0 2.5% 19.2 18.4 $-4.1%$
Goodwill 14.5 14.5 0.0% 14.5 0.0% 14.5 14.5 0.0%
Investments 863.2 928.4 7.5% 900.6 3.1% 863.2 928.4 7.5%
Deferred Tax Assets 4.5 16.2 16.3 $-0.4%$ 4.5 16.2
Others 9.4 6.7 $-28.7%$ 6.6 1.9% 9.4 6.7 $-28.7%$
Current Assets 280.4 264.9 $-5.6%$ 256.0 3.5% 280.4 264.9 $-5.6%$
Trade Receivables 19.9 10.0 $-49.8%$ 11.1 $-9.7%$ 19.9 10.0 $-49.8%$
Liquiditu 233.1 222.8 $-4.4%$ 221.7 0.5% 233.1 222.8 $-4.4%$
Others 27.5 32.1 16.8% 23.2 38.3% 27.5 32.1 16.8%
Assets held for sale 0.0 0.0 20.0 $-100.0\%$ 0.0 0.0
Shareholders' Funds 1,076.3 1,152.7 7.1% 1,124.1 2.5% 1,076.3 1,152.7 7.1%
Group Share 1,072.1 1,141.4 6.5% 1,111.9 2.7% 1,072.1 1,141.4 6.5%
Non-Controlling Interests 4.3 11.2 163.1% 12.2 $-8.0%$ 4.3 11.2 163.1%
Total Liabilities 115.0 96.5 $-16.1%$ 107.8 $-10.5%$ 115.0 96.5 $-16.1%$
Non Current Liabilities 58.1 45.5 $-21.7%$ 42.8 6.2% 58.1 45.5 $-21.7%$
Loans 2.3 1.4 $-38.7%$ 1.6 $-12.5%$ 2.3 1.4 $-38.7%$
Provisions 22.6 0.6 $-97.3%$ 0.7 $-11.9%$ 22.6 0.6 $-97.3%$
Others 33.1 43.4 31.1% 40.5 7.2% 33.1 43.4 31.1%
Current Liabilities 56.9 51.0 $-10.4%$ 50.4 1.1% 56.9 51.0 $-10.4%$
Loans 1.3 3.5 164.8% 2.8 25.8% 1.3 3.5 164.8%
Trade Payables 17.4 7.6 $-56.1%$ 8.6 $-11.4%$ 17.4 7.6 $-56.1%$
Others 38.2 39.9 4.4% 39.0 2.2% 38.2 39.9 4.4%
Liabilities directly associated with the assets held for sale 0.0 0.0 14.6 $-100.0%$ 0.0 0.0
Operating CAPEX (1) 1.1 2.4 127.1% 0.8 3.5 4.4 24.5%
Operating CAPEX as % of Turnover 6.0% 13.6% 7.6pp 4.1% 9.5 pp 6.9% 8.1% 1.2pp
Total CAPEX 4.6 8.8 89.4% 2.6 11.4 15.4 34.8%
Underlying EBITDA - Operating CAPEX $-1.9$ $-3.7$ $-91.2%$ $-2.2$ $-64.4%$ $-7.3$ $-7.9$ $-7.7%$
Gross Debt 16.6 18.2 9.1% 17.4 4.2% 16.6 18.2 9.1%
Net Debt $-216.4$ $-204.6$ 5.4% $-204.3$ $-0.2%$ $-216.4$ $-204.6$ 5.4%

R - Restated according with introductory notes;
(1) Operating CAPEX excludesFinancial Investments.

Consolidated levered FCF

Million euros

LEVERED FREE CASH FLOW 3Q20R 3Q21 $\triangle$ 21/20 2021 q.o.q. 9M20R 9M21 $\triangle$ 21/20
Underlying EBITDA-Operating CAPEX $-1.9$ $-3.7$ $-91.2%$ $-2.2$ $-64.4%$ $-7.3$ -7.9 $-7.7%$
Change in WC 1.5 $-8.7$ $\sim$ 8.2 $-3.1$ -1.5 51.9%
Non Cash Items & Other 0.3 5.1 $-2.9$ 2.8 2.3 $-17.1%$
Operating Cash Flow $-0.1$ $-7.3$ 3.0 $-7.7$ $-7.1$ 7.7%
Investments 15.3 3.4 $-77.6%$ 34.3 $-90.0%$ 8.7 34.9 $\sim$
Dividends 0.0 0.0 $\sim$ 0.0 0.0 0.0 ۰
Financial results $-0.1$ 4.9 $\sim$ 1.3 $\overline{\phantom{0}}$ $-0.2$ 6.5 $\sim$
Income taxes $-4.3$ $-0.7$ 84.3% $-6.2$ 89.2% $-2.8$ $-6.4$ $-128.2\%$
$FCF^{(1)}$ 10.8 0.4 $-96.4%$ 32.4 -98.8% $-2.0$ 27.9 $\sim$

R - Restatedaccording with introductory notes;
(1) FCF Levered after Financial Expenses but before Capital Flows and Financingrelated up-front Costs.

II-FINANCIAL STATEMENTS

MANAGEMENT REPORT & ACCOUNTS 2021

5. Condensed Financial Information 5.1. Sonaecom condensed consolidated financial statements

Condensed consolidated statement of financial position

For periods ended on 30 September 2021 and 31 December 2020

(Amounts expressed in Euro) Notes September 2021
(not audited)
December 2020
Assets
Non-current assets
Property, plant and equipment 1,807,030 2,034,408
Intangible assets 7,225,002 8,240,910
Right of use 9,396,027 10,609,677
Goodwill 14,520,952 14.520.952
Investments in joint ventures and associated companies 6 838,844,900 807.795.660
Financial assets at fair value through other comprehensive income $\overline{7}$ 7,601,859 7,299,791
Financial assets at fair value through profit or loss 8 81,930,575 92,324,063
Deferred tax assets 16,231,938 16,380,468
Other non-current assets 6,703,344 7,602,700
Total non-current assets 984,261,627 966,808,629
Current assets
Inventories 136,126 251.827
Trade receivables 9,989,126 22.616.717
Other receivables 16,538,642 8,314,544
Income tax assets 2,025,670 1,819,652
Other current assets 13,378,096 13,971,930
Cash and cash equivalents 222,788,193 233,707,494
Total current assets 264,855,853 280,682,164
Total assets 1,249,117,480 1,247,490,793
Shareholders' funds and liabilities
Shareholders' funds
Share capital 230,391,627 230,391,627
Own shares (7,686,952) (7.686.952)
Reserves and retained earnings 850,838,382 818,589,511
Consolidated net income/(loss) for the period 67,888,047 60.125.890
1,141,431,104 1101,420,076
Non-controlling interests 11,234,351 13.080.206
Total Shareholders' funds 1,152,665,455 1,114,500,282
Liabilities
Non-current liabilities
Loans 1,408,729 2.146,527
Lease liabilities 9,959,386 11,072.814
Provisions 608,660 30,007,840
Deferred tax liabilities 33,077,707 28,054,313
Other non-current liabilities 399,312 264.105
Total non-current liabilities 45,453,794 71,545,599
Current liabilities
Loans 3,504,878 1.546.801
Trade payables 7,622,182 16,886.338
Lease liabilities 3,278,653 3.408.625
Other payables 14,226,417 9,639,257
Income tax liabilties 1,852
Other current liabilities 22,364,249 29,963,891
Total current liabilities 50,998,231 61,444,912
Total Liabilities 96,452,025 132,990,511
Total Shareholders' funds and liabilities 1,249,117,480 1.247.490.793

The notes are an integral part of the condensed consolidated financial statements.

The Certified Accountant

Condensed consolidated income statement by nature

For periods of 9 months ended on 30 September 2021 and 2020 (restated)

(Amounts expressed in Euro) Notes September 2021
(not audited)
September 2020
(not audited and
restated)
Sales 9 16,011,147 16,461,285
Services rendered 9 37,682,945 34,445,004
Other income 1,555,686 1,399,085
55,249,778 52,305,374
Cost of sales (10, 083, 656) (10,300,244)
External supplies and services (15, 810, 174) (14, 645, 344)
Employee benefits expense (33,709,448) (31,213,372)
Amortisation and depreciation (5,341,661) (6,393,222)
Provisions (66, 150) (116, 612)
Impairment losses (108, 346) (65,786)
Other expenses (611, 596) (252, 621)
(65, 731, 031) (62.987.201)
Gains and losses in joint ventures and associated companies 6 59,999,463 12,312,673
Gains and losses on assets at fair value through profit or loss 8 23,847,179 29,345,076
Financial expenses (1,510,216) (2,645,731)
Financial income 1,667,708 2,006,017
Current income / (loss) 73,522,881 30,336,208
Income taxation (11, 529, 262) (3,115,331)
Consolidated net income/(loss) for the period of continued operations 61,993,619 27,220,877
Consolidated net income/(loss) for the period of discontinued operations 10 5,271,108 253,423
Consolidated net income/(loss) for the period 67,264,727 27,474,300
Attributed to:
Shareholders of parent company 67,888,047 28,707,347
Non-controlling interests (590, 615) (1,296,149)
Non-controlling interests (discontinued operations) (32,705) 63.102
Earnings per share
Including discontinued operations
Basic 0.22 0.09
Diluted 0.22 0.09
Excluding discontinued operations
Basic 11.23 5.12
Diluted 11.23 5.12

The notes are an integral part of the condensed consolidated financial statements.

The Certified Accountant

Condensed consolidated statement of comprehensive income

For periods of 9 months ended on 30 September 2021 and 2020 (restated)

(Amounts expressed in Euro) Notes September 2021
(not audited)
September 2020
(not audited and
restated)
Consolidated net income / (loss) for the period 67.264.727 27.474.300
Components of other consolidated comprehensive income, net of tax, that will be reclassified
subsequently to profit or loss:
Changes in reserves resulting from the application of equity method 1,895,548 (3.817.322)
Changes in currency translation reserve and other (9,477) 210.100
Components of other consolidated comprehensive income, net of tax, that will not be reclassified
subsequently to profit or loss:
Changes in reserves resulting from the application of equity method (419, 547) (1.134.263)
Changes in fair value of financial assets at fair value through other comprehensive income net of taxes (restated) 274,775 331.483
Consolidated comprehensive income for the period 69.006.026 22.732.815
Attributed to:
Shareholders of parent company 69.612.034 23.890.650
Non-controlling interests (606,008) (1,157,836)

The notes are an integral part of the condensed consolidated financial statements.

The Certified Accountant

Condensed consolidated statement of changes in equity

For periods of 9 months ended on 30 September 2021 and 2020 (restated)

Reserves
Reserves of own Non-controlling Net
(Amounts expressed in Euro) Share capital Own shares Share premium Legal reserves shares Other reserves Total reserves interests income / (loss) Total
2021
Balance on 31 December 2020 230,391,627 (7,686,952) 775,290,377 20,683,925 7,686,952 14,928,257 818,589,511 13,080,206 60,125,890 1,114,500,282
Appropriation of the consolidated net result of 2020
Transfers to other reserves 153,812 59.972.078 60,125,890 (60, 125, 890)
Dividend Distribution (29,659,595) (29,659,595) (29,659,595)
Percentage change in subsidiaries (1,241,726) (1,241,726)
Consolidated comprehensive income for the period ended on 30 September 2021 1,721,935 1,721,935 (606,008) 67,888,047 69,003,974
Other changes 60.641 60,641 1,879 62,520
Balance on 30 September 2021 230,391,627 (7,686,952) 775,290,377 20,837,737 7,686,952 47,023,316 850,838,382 11,234,351 67,888,047 1,152,665,455
Reserves
Reserves of own Non-controlling Net
(Amounts expressed in Euro) Share capital Own shares Share premium Legal reserves shares Other reserves Total reserves interests income / (loss) Total
2020
Balance on 31 December 2019 (restated) 230,391,627 (7,686,952) 775,290,377 18.545.192 7.686.952 (3,246,742) 798,275,779 (636, 155) 52,168,120 1.072.512.419
Appropriation of the consolidated net result of 2019
Transfers to other reserves 2.138.733 50,029,387 52,168,120 (52,168,120)
Dividend Distribution (25.378.829) (25.378.829) (175,000) (25,555,829)
Percentage change in subsidiaries 6,000,000 6,000,000
Consolidated comprehensive income for the period ended on 30 September 2020 (restated) (4,485,214) (4,485,214) (1,157,836) 28,707,347 23.064.297
Other changes 84,695 84,695 238,236 322.931
Balance on 30 September 2020 230,391,627 7,686,952 775,290,377 20.683.925 7.686.952 17.003.297 820.664.551 4,269,245 28,707,347 1.076.345.818

The notes are an integral part of the condensed consolidated financial statements.

The Certified Accountant

Condensed consolidated cash flow statement

For periods of 9 months ended on 30 September 2021 and 2020

(Amounts expressed in Euro) September 2021
(not audited)
September 2020
(not audited)
Operating activities
Receipts from trade debtors 77,689,038 107,910,317
Payments to trade creditors (46, 036, 022) (73,806,887)
Pauments to emplouees (37, 167, 967) (33,259,636)
Cash flows generated by operations (5,514,951) 843,794
Payments / receipts relating to income taxes (623, 870) (5,594,481)
Other receipts / payments relating to operating activities (2,504,051) (3,847,646)
Cash flows from operating activities (1) (8,642,872) (8,598,333)
Investing activities
Receipts from:
Financial investmens 37,755,532
Tangible assets 25,759 23,313
Intangible assets 573,807
Dividends 50
Interest and similar income 348.139 327,540
Others 1,499,916 18,907,195
Pauments for:
Financial investments (9,539,098) (7,935,010)
Tangible assets (478, 799) (595,509)
Intangible assets (425, 301) (1,216,849)
Variation in loans granted (249.932)
Cash flows from investing activities (2) 29.186.198 9.834.555
Financing activities
Receipts from:
Capital increases, supplementary capital and share premium 6,000,000
Loans obtained 1,191,024 500.000
Pauments for:
Leasing (2,711,833) (3,012,919)
Interest and similar expenses (289, 265) (239,652)
Dividends (29,659,595) (25,555,829)
Loans obtained (1,710,881)
Cash flows from financing activities (3) (31,469,669) (24,017,281)
Net cash flows $(4)=(1)+(2)+(3)$ (10, 926, 343) (22,781,059)
Effect of the foreign exchanges 7,042 (34.951)
Cash and cash equivalents at the beginning of the period 233,707,494 255,876,971
Cash and cash equivalents at the end of the period 222,788,193 233,060,961

The notes are an integral part of the condensed consolidated financial statements.

The Certified Accountant

5.2. Notes to the condensed consolidated financial statements of Sonaecom

1. Introductory note

SONAECOM, SGPS, S.A. (hereinafter referred to as 'the Company' or 'Sonaecom') was established on 6 June 1988, under the name Sonae - Tecnologias de Informação, S.A. and has its head office at Lugar de Espido, Via Norte, Maia - Portugal. It is the parent company of the Group of companies listed in note 4 and 5 ('the Group').

On 1 June 2000, the company was admitted to trading on Euronext Lisbon, however, with effect from February 24, 2014, it was excluded from the PSI-20.

Sonaecom SGPS, S.A. is owned directly by Sontel BV and Sonae SGPS, SA and Efanor Investimentos SGPS, S.A. is the ultimate controlling company.

In addition to the holding activity, the group's businesses essentially consist of media and technology activities. The Group operates in Portugal and has subsidiaries from the information systems consultancy segment operating in about 4 countries.

The condensed consolidated financial statements are presented in euros, rounded to the unit, except when were referred, being the Group's main currency. Foreign currency transactions are translated into the functional currency of each entity at the exchange rate on the date of the transaction. The financial statements of subsidiaries with another currency have been converted into euros using the average exchange rates at the reporting date.

Relevant events occurred during the period

On 7 January 2021, following the worsening pandemic situation it was formally declared a new state of emergency and a new national lock-down which marked almost the full first quarter in Portugal. The evolution of cases numbers worldwide continued to trend up in second quarter with Europe and USA being regions strongly affected by the second wave. Since April with the vaccination process speeding-up in Europe and USA, we have been experiencing a progressive deconfinement and reopening of economu.

The Board of Directors continued to follow in detail and with great concern all the pandemic developments, following closely the position of the competent international entities, namely the World Health Organization and the European Centre for Disease Prevention and Control, as well as the Portuguese Directorate-General of Health.

Aligned with the Group's Risk Management Policies, contingency plans with correspondent mitigation actions were constantly updated and actioned across all companies and departments, allowing to keep our employees protected and to face this turmoil period with the less loss of value.

In the nine months ended on 30 September 2021, the financial and operational impacts continued to be different across segments:

  • The technology area continued to prove a strong resilience with no relevant impacts from pandemic situation across the world;
  • At NOS, the impacts were felt particularly in roaming and in the Cinemas and Audiovisuals activity with the closing of all cinemas from 15 January to 19 April, which inevitably impacted consolidated revenues and EBITDA evolution. In the second quarter, the cinemas reopened, with an encouraging affluence, although activity is only expected to recover to pre-pandemic levels in 2023.
  • Público's activitu faced a significant decrease in advertising activitu during the first quarter but its digital strategy coupled with an advertising market recover resulted in a second quarter growing in almost all revenue lines.

In terms of projecting future impacts, these will depend on the extent, namely temporal, of the spread of the virus and the respective measures to control the epidemiological situation and the intervention of Governments, both with regard to compliance with vaccination plans, and with regard to respect to the support made available to economic agents, it being difficult to predict the size of the impact.

However, given the company's capital structure, with a significant amount in cash and bank deposits and a low amount of remunerated debt, no material changes in the Company's liquidity are expected. Furthermore, Sonaecom will continue to implement all measures deemed appropriate to minimize their impacts, in line with the recommendation of the competent entities and in the best interest of all our stakeholders.

2. Main accounting policies and basis of presentation

The condensed consolidated financial statements for the period ended on 30 September 2021, were prepared in accordance with IAS 34 - Interim Financial Reporting. Consequently, these financial statements do not include all the information required by the International Financial Reporting Standards ('IFRS'), so they should be read with the consolidated financial statements for the year end on 31 December 2020. The accounting policies and measurement criteria, adopted by the Group on 30 September 2021 are consistent with those used in the preparation of 31 December 2020 financial statements, except for the calculation of tax on the period, in accordance with IAS 34.

The condensed consolidated financial statements of Sonaecom Group were prepared on the assumption of continuity of operations, based on the books and accounting records of the companies included in the consolidation, which were prepared in accordance with the International Financial Reporting Standards ('IFRS') as adopted and effective in the European Union and, based on historical cost, except for the revaluation of certain financial instruments.

3. Change in accounting policies and comparability of consolidated financial statements

During the period there were no changes in accounting policies, except for the adoption of new standards whose application became effective on 1 January 2021 which had no material impact on the Group's condensed financial statements.

The following standards, interpretations, amendments and revisions have been approved (endorsed) by the European Union and had mandatory application to the financial years beginning on or after 1 January 2021 and were first adopted in the period ended on 30 September 2021:

  • Amendment to IAS 16 Proceeds before intended use: This amendment changes the accounting treatment of the proceeds obtained from the sale of products that resulted from the production test phase of property, plant and equipment, prohibiting their deduction to the acquisition cost of assets.
  • Amendment to IFRS 3 Reference to the Conceptual framework: This amendment updates the references to the Conceptual Framework without changing the accounting requirements for business combinations.
  • Amendments to IFRS 16 Leases Rents related to Covid-19 after 30 June 2021: Extension of amendments to 'IFRS 16 Leases Covid-19 related to rent concessions' for rent payments due on or before 30 June 2022.
  • Amendment to IAS 37 Onerous Contracts Cost of fulfilling a contract: This amendment specifies that when assessing whether a contract is onerous or not. Only expenses directly related to the performance of the contract can be considered.
  • Annual Improvements 2018 2020: The 2018-2020 annual provides improvements to: IFRS 1 (Subsidiary as first-time IFRS adopter), IFRS 9 (Derecognition of liabilities), IFRS 16 (Leasing incentives) and IAS 41 (Taxation and measurement of fair value). This amendment is applied prospectively.
  • Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16: Reform of the reference interest rate (phase 2): These amendments deal with issues that arise during the reform of an interest rate reference which include the replacement of a reference interest rate with another alternative, allowing for the application of exemptions.

The Group concluded that the application of these standards did not have a materially effect on the financial statements.

The following standards, interpretations, amendments and revisions, until the period ended on 30 September 2021, have not been approved ('endorsed') by the European Union:

  • IFRS 17 Insurance contracts (includes changes to the standard): This new standard replaces IFRS 4 which becomes mandatory since 2004. IFRS 17 apply to all entities issuing insurance contracts, reinsurance contracts and investment contracts with discretionary participation characteristics.
  • Amendment to IAS 1 Classification of liabilities as current or non-current: This amendment intends to clarify that liabilities are classified as either current or non-current balances depending on the rights that an entity has to defer its payment, at the end of each reporting period.
  • Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: The changes require companies to disclose their material accounting policy information instead of their significant accounting policies. The amendments to the practical file of IFRS 2 provide guidance on how to apply the concept of materiality to accounting policy disclosures.
  • Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Error: The changes clarify how companies should differentiate changes in accounting policies from changes in accounting estimates.
  • Amendments to IAS 12 Income tax: The amendments clarify how companies account for deferred taxes on transactions such as leases and decommissioning obligations.

To ensure the comparability of the financial statements, the condensed consolidated financial statements for the period ended on 30 September 2020 were restated by the effects described below:

Restatement of consolidated financial statements

Review of the classification of minority participations

In the year ended 31 December 2020, a review of the classification of minority investments in the subsidiaries SonaelM, Bright Development and Bright Vector I, recorded in the Group to date in accordance with IFRS 9 at fair value through other comprehensive income, was made. As a result of this review, the Group concluded that it had a significant influence on the majority of these investments. Accordingly, and, considering that the investment activity carried out by the referred subsidiaries fits, for the purposes of the exemption provided for in paragraph 18 of IAS 28, as a venture capital activity, the Group opted for the exemption from application of the equity method, starting to measure, the minority investments held by them, at fair value through profit or loss in accordance with IFRS 9.

The financial statements for the period ended on 30 September 2020 were restated in order to incorporate the changes described above.

Digitmarket classification as a discontinued operating unit

On 16 July 2021, the entire share capital and voting rights of Digitmarket Sistemas de Informação S.A. (75% held by Sonae Investment Management-Software and Technology, SGPS, S.A., 15% by AITEC Capital, SGPS, S.A. and 10% by Banco BPI, S.A.), was sold to Claranet Portugal, S.A. For presentation purposes, Digitmarket was classified as a discontinued operating unit.

As provided for bu IFRS 5, changes were made to the 'Condensed consolidated statement of income bu nature' for the period ended on 30 September 2020 to consider in a one heading ('Net income for the period from discontinued operations'), in the 'Statement results', the profits or losses after taxes of discontinued operations.

(Amounts expressed in Euro) (reported) September 20 Restatement of classification
of minority interests
Restatement of
Digitmarket's contribution
to discontinued units
September 20
(restated)
BALANCE SHEET
Non-current assets
Investments in joint ventures and associated companies (note 6) 767.661.728 157.890 767,819,618
Financial assets at fair value through other comprehensive income (note 7) 95,802,232 (86, 984, 283) 8.817.949
Financial assets at fair value through profit or loss (note 8) 86,584,284 86,584,284
Shareholders' funds
Reserves and retained earnings 842,876,111 (22, 211, 560) 820,664,551
STATEMENT OF COMPREHENSIVE INCOME
Total Revenues 100,907,762 (48,602,388) 52,305,374
Cost of sales (53, 570, 517) 43,270,273 (10,300,244)
External supplies and services (16,960,984) 2,315,640 (14, 645, 344)
Employee benefits expense (33,595,725) 2,382,353 (31, 213, 372)
Depreciation and amortisation (6,634,061) 240,839 (6,393,222)
Other expenses (256,990) 4.369 (252, 621)
Financial expenses (2,690,529) 44,798 (2,645,731)
Financial income 2,233,576 (218, 117) (9,442) 2,006,017
Gains and losses in joint ventures and associated companies (note 6) 12,336,666 (23, 993) 12,312,673
Gains and losses on assets at fair value through profit or loss (note 8) 29.345.076 29,345,076
Income taxation 3,918,049 (7, 133, 515) 100.135 (3, 115, 331)
Consolidated net income/(loss) for the period of continued operations 5,504,849 21.969.451 (253, 423) 27,220,877
Consolidated net income/(loss) for the period of discontinued operations 253,423 253,423
Non-controlling interests (1,233,047) (63,102) (1,296,149)
Non-controlling interests (discontinued operations) 63,102 63,102

4. Companies included in the consolidation

Group companies included in the consolidation through full consolidation method, their head offices, main activities, shareholders and
percentage of share capital held on 30 September 2021 and 2020, are as follows: .
امامط احانودی

Percentage of share capital held
2021 2020
Company (Commercial brand) Head office Main activity Shareholder Direct Effective* Direct Effective*
Parent company
SONAECOM, S.G.P.S., S.A. ('Sonaecom')
Maia Management of shareholdings
Subsidiaries
Bright Developement Studio, S.A. ('Bright') Lisbon Research, development and commercialization of projects and service
solutions in the area of information technology, communications and
retail, and consulting activities for business and management.
Sonae IM 100% 100% 100% 100%
Bright Ventures Capital, SCR, S.A. Lisbon Realization of investment in venture capital, management of venture
capital funds and investment in venture capital fund units.
Bright 100% 100% 100% 100%
Digitmarket - Sistemas de Informação, S.A.
('Digitmarket' - using the brand 'Bizdirect') (a)
Maia Development of management platforms and commercialisation of
products, services and information, with the internet as its main support.
Sonae IM Alienated 75% 75%
Excellium Group, S.A. ('Excellium') Contern Excellium assist enterprises to perform business and risk assessments,
define security policies and procedures, respond to security incidents
and deliver computer forensics services.
Maxive 59.20% 59.20% 59.20% 59.20%
Excellium Services, S.A. ('Excellium Services') Contern Provide services within the IT and cibersecurity domain mainly to
Luxembourgish institutions, banks and insurance companies.
Excellium 100% 59.20% 100% 59.20%
Excellium Services Belgium, S.A.
('Excellium Services Belgium')
Wavre Provide services within the IT and cibersecurity domain mainly to
Belgium institutions, banks and insurance companies.
Excellium 100% 59.20% 100% 59.20%
Excellium Factory SARL ('Excellium Factory') (b) Raouad - Ariana Vehicle for the Excellium product development in Africa. Excellium Liquidated 80% 47.36%
Inovretail, S.A. Oporto Industry and trade of electronic equipment and software; development,
installation, implementation, training and maintenance of systems and
software products; rental equipment, sale of software use license;
consulting business, advisory in retail segments, industry and services.
Sonae IM 100% 100% 100% 100%
Inovretail España, SL ('Inovretail España') Madrid Industry and trade of electronic equipment and software; development,
installation, implementation, training and maintenance of systems and
software products; rental equipment, sale of software use license;
consulting business, advisory in retail segments, industry and services.
Inovretail 100% 100% 100% 100%
Fundo Bright Vector I ('Bright Vector I') Lisbon Venture Capital Fund Sonae IM 50.13% 50.13% 50.13% 50.13%
Sonaecom
Sonae IM
10%
10%
25%
25%
25%
25%
Fundo Bright Tech Innovation I
('Bright Tech Innovation I') (c)
Maia Venture Capital Fund Bright
PCJ
Sonaecom SP
10%
10%
10%
50%
Maxive- Cybersecutiry, SGPS.S.A ('Maxive') (d) Maia Management of shareholdings. Sonae IM 100% 100% 100% 100%
Mxtel, S.A. de CV (Mxtel) Mexico City Rendering of engineering and IT consulting services specializing in
information security and management of telecommunications services.
S21 Sec Gestion 99.93% 80.90% 99.93% 80.90%
PCJ - Público, Comunicação e Jornalismo, S.A. ('PCJ') Maia Editing, composition and publication of periodical and non-periodical
material and the exploration of radio and TV stations and studios.
Sonaecom 100% 100% 100% 100%
Praesidium Services Limited ('Praesidium Services') London Rendering of consultancy services in the area of information systems. Sonae IM 100% 100% 100% 100%
Público - Comunicação Social, S.A. ('Público') Oporto Editing, composition and publication of periodical and non-periodical
material.
Sonaecom 100% 100% 100% 100%
S21Sec Portugal Cybersecurity Services, S.A.
('S21 Sec Portugal')
Maia Commercialization of products and management services,
implementation and consulting in information systems and
technologies areas.
S21 Sec Gestion 100% 80.90% 100% 80.90%
S21 Sec Gestion, S.A. ('S21 Sec Gestion') Guipuzcoa Consulting, advisory, audit and maintenance of all types of facilities and
advanced communications services and security systems. Purchase and
installation of advanced communications and security systems produced
by others.
Maxive 80.90% 80.90% 80.90% 80.90%
S21 Sec Information Security Labs, S.L.
('S21 Sec Labs')
Navarra Research, development and innovation, as well as consulting,
maintenance and audit for products, systems, facilities and
communication and security services.
S21 Sec Gestion 100% 80.90% 100% 80.90%
S21 Sec, S.A. de CV ('S21 Sec, S.A. de CV') Mexico City Computer consulting services S21 Sec Gestion
S21 Sec Labs
99.9996%
0.0004%
80.90% 99.9996%
0.0004%
80.90%
Sonaecom - Serviços Partilhados, S.A.
('Sonaecom SP')
Maia Support, management consulting and administration, particularly in the
areas of accounting, taxation, administrative procedures, logistics, human Sonaecom
resources and training.
100% 100% 100% 100%
Sonae Investment Management - Software and Technology,
SGPS, S.A. ('Sonae IM')
Maia Management of shareholdings in the area of corporate ventures and
joint ventures.
Sonaecom 100% 100% 100% 100%
* Sonaecom effective participation

(a) On 16 July 2021, Sonae IM sold the entire share capital and voting rights of Digitmarket Sistemas de Informação S.A
(b) Company liquidated in June 2021.
(c) Fund constitued in June 2020 with full subscription of partic

All the above companies were included in the consolidation in accordance with the full consolidation method under the terms of IFRS 10
- 'Consolidated Financial Statements'.

5. Changes in the group

During the periods ended on 30 September 2021 and 2020, the following changes occurred in the composition of the Group:

a) Acquisitions

Shareholder Subsidiary, Date
2021
Bright Vector I Automaise, Lda ('Automaise') (note 8) - increase $Jan-21$
Sonae IM Sellforte Solutions Oy ('Sellforte') (note 8) Feb-21
Sonae IM Aruaka Networks ('Aruaka') (note 8) Apr-21
Sonae IM Portainer.io Limited ('Portainer') (note 8) Apr-21
Bright Vector I Habit Analutics PT (note 8) - increase $Jul-21$
Bright Vector I Taikai, Lda. ('Taikai') (note 8) Aug-21
Bright Tech Innovation I Reckon.AI, S.A. ('Reckon.AI') (note 8) Aug-21
Sonae IM Citcon Limited ('Citcon') (note 8) Aug-21
Sonae IM Jscrambler, S.A. ('Jscrambler') (note 8) - increase Sep-21
Sonae IM Replai (note 8) Sep-21
Shareholder Subsidiary Date
2020
Sonae IM Sales Layer Tech, S.L. (note 8) Mar-20
Bright Vector I Replai (note 8) Jun-20
Sonae IM Deepfence Inc ('Deepfence') (note 7) Set-20
Sonae IM IriuskRisk (note 7)- increase Set-20

b) Constitutions

Shareholder Subsidiaru Jate
2020
Sonae IM and Sonaecom Bright Tech Innovation I Jun-20

c) Alienations

Shareholder Subsidiaru Date
2021
Sonae IM Secucloud Network GmbH ('Secucloud') (note 6) Apr-21
Sonae IM Digitmarket - Sistemas de Informação S.A ('Digitmarket') (note 10) $Jul-21$
Sonae IM Context-Based 4 Casting (C-B4) LTD ('CB4') (note 8) $Sen-21$

Effects of the alienation of subsidiaries in the condensed consolidated financial statements

In July 2021, with effects from 30 June 2021, Digitmarket - Sistemas de Informação S.A. was alienated by the amount of EUR 9,127,104
to Claranet Portugal, S.A.. As a result of the value of sale and the derecognition of the 5,401,927 was registered, as detailed below:

(Amounts expressed in Euro) June 2021
Assets
Assets derecognised
Property, plant and equipment, intangible assets and Right of use 905,739
Deferred tax assets 155,564
Other non-current assets 61,338
Inventories 198,413
Trade receivables 8,048,295
Other current assets 2,965,334
Cash and cash equivalents 7,789,491
20,124,174
Liabilities derecognised
Lease liabilities (830, 923)
Provisions (12,661)
Trade payables (8,333,256)
Other current liabilities (5,980,431)
(15, 157, 271)
Total net assets derecognised 4,966,902
Total net assets of non-controlling interests derecognised (1, 241, 726)
Total net assets after non-controlling interests derecognised 3,725,177
Amount received 9,127,104
Gain/ (loss) on the sale 5,401,927

d) Dissolutions

Shareholder Subsidiary Date:
2021
Excellium Excellium Factory SARL ('Excellium Factory') Jun-,

6. Investments in joint ventures and associated companies

The associated companies and the companies jointly controlled, their head offices, percentage of ownership and value in profit and loss statement on 30 September 2021 and 2020 are as follows:

Percentage of ownership Value in profit and loss statement
30 September 2021 30 September 2020 30 September 2021 30 September 2020
Head Office Direct Total Direct Total (restated)
ZOPT, SGPS, S.A. ('ZOPT') (a) Oporto 50.00% 50.00% 50.00% 50.00% 28,629,776 21,387,528
Unipress - Centro Gráfico, Lda. ('Unipress') Vila Nova de Gaia 50.00% 50.00% 50.00% 50.00% 826 (6,670)
SIRS - Sociedade Independente de Radiodifusão
Sonora, S.A. ('Rádio Nova')
Oporto 50.00% 50.00% 50.00% 50.00% (16, 490) (39,030)
Intelligent Big Data, S.L. ('Big Data') (b) Gipuzcoa 50.00% 50.00% 2,657
Fundo de Capital de Risco Armilar Venture
Partners II (Armilar II)
Lisbon 44.33% 44.33% 50.74% 50.74% 556,630 (8,156,114)
Fundo de Capital de Risco Armilar Venture
Partners III (Armilar III)
Lisbon 42.80% 42.80% 42.80% 42.80% 27,799,549 7,444
Fundo de Capital de Risco Armilar Venture
Partners Inovação e Internacionalização
(Armilar I+I)
Lisbon 38.25% 38.25% 38.25% 38.25% 2,984,734 (677, 584)
Secucloud Network GmbH ('Secucloud') (c) Hamburg $\overline{\phantom{a}}$ 27.45% 27.45% 70,511 (185,950)
Probe.lu Lisbon 21.21% 21.21% 21.21% 21.21% (26, 073) (19,608)
Suricate Solutions Luxembourg 20.00% 11.84% 20.00% 11.84%
Alfaros SAR Tunisia 40.00% 23.68% 40.00% 23.68% $\sim$
Total 59,999,463 12,312,673

(a) Includes the incorporation of the results of the subsidiaries in proportion to the capital held

(b) Company liquidated in november 2020 (c) Company sold in April 2021

In case of investments in associates that are venture capital organizations, IAS 28 contains an option to keep these investments held by them measured at fair value. The Group made this option, applying the equity method to Armilar Funds.

In accordance with IFRS 11, the classification of investments in joint ventures is determined based on the existence of an agreement that clearly demonstrate and regulate the joint control. The Group held associated and jointly controlled companies, as decomposed below.

The division by company of the amount included in the investments in associated companies and joint ventures on 30 September 2021 and 31 December $2020$ is as follows:

30 September 2021 31 December 2020
Ownership value Goodwill Total investment Ownership value Goodwill Total investment
Investments in companies jointly controlled
Zopt 605.561.462 87,527,500 693,088,962 575,455,685 87,527,500 662,983,185
Unipress 405,961 321,700 727,661 405,135 321,700 726,835
SIRS 3,240 3,240 19,730 19,730
553,392,312 87,849,200 693,819,863 575,880,550 87,849,200 663,729,750
Investments in associated companies
Armilar II 76,826,314 76,826,314 96,578,405 96,578,405
Armilar III 52,841,378 - 52,841,378 31,302,286 31,302,286
Armilar I+I 15,224,031 15,224,031 16,025,832 16,025,832
Secucloud (2,499,722) 2,499,722
Probe.lu (189, 344) 297,168 107,824 (163,271) 297,168 133,897
Suricate Solutions 20.953 20.953 20,953 20,953
Alfaros SARL 4,537 4,537 4,537 4,537
141,741,429 4,716,910 145,025,037 141,269,020 2,796,890 144,065,910
Total 695.133.741 92,566,110 838,844,900 717149,570 90,646,090 807,795,660

In the period ended on 30 September 2021, due to changes to the Armilar Funds Regulation, the amount related to the contractual incentive (Incentive Scheme) to be paid to the Fund' Management Company, recorded in "Provisions" in the amount of EUR 28,781,304, was reclassified to "Investments in joint ventures and associated companies".

The amount on the income statement related to Zopt results from net income of NOS, the net income of Zopt and the impact on results of the process of allocating the fair value to the assets and liabilities acquired by Zopt.

On 30 September 2021, it was considered that the assumptions made in the impairment tests carried out in 2020 did not have significant variations.

With regard to ZOPT's financial participations in Finstar and ZAP Media (Finstar consolidated), the Board of Directors of NOS and ZOPT is certain that the patrimony seizure to Mrs. Isabel dos Santos, in the specific case of the shares held by her in Finstar and ZAP Media (where she holds 70% of the capital), does not change the control profile, in this case joint control as defined in IFRS 11, it is not expected to have relevant consequences for the operational management of companies, in addition to restrictions on the distribution of dividends in these companies.

On 4 April 2020, SONAECOM, was informed by its subsidiary ZOPT of the communication received from the Lisbon Central Criminal Instruction Court ('Court') to proceed to the preventive arrest of 26.075% of NOS' share capital, corresponding to half the shareholding in NOS held by ZOPT and, indirectly, by the companies Unitel International Holdings, BV and Kento Holding Limited, controlled by Mrs. Isabel dos Santos. Under the terms of the communication, the arrested shares (134,322,268.5 shares) are deprived of the right to vote and the right to receive dividends, which must be deposited with Caixa Geral de Depósitos, S.A. (CGD) at the order of the court. The other half of ZOPT's participation in NOS' share capital, corresponding to an identical percentage of 26.075% - and which, at least in line with the criterion used by the Court, embodies the 50% held in ZOPT by SONAECOM-was not subject to arrest, nor the rights attached to it were subject to any limitation.

It is the understanding of the Board of Directors of ZOPT and SONAECOM that the measure of arrest imposed is illegitimate and offends several fundamental rights of ZOPT-third in relation to the decreed arrest-, no being legally liable to determine the deprivation of voting rights, not even to inhibit the holder of the arrested shares from continuing to exercise those rights, which deprivation we understand for this reason, be null and without any effect. Thereafter, ZOPT has deducted third-party embargoes.

On 12 June 2020, ZOPT was notified of the order issued by the Lisbon Central Criminal Investigation Court, which authorizes it to exercise the voting right corresponding to the 26.075% of NOS share capital preventively seized under the aforementioned Court order. For this reason, the Boards of Directors of ZOPT and SONAECOM consider that the conditions of control of ZOPT over NOS are met, and the measure does not have material effects on the control of this company. Also in June 2020, the Investigating Judge rejected the thirdparty embargoes deducted by ZOPT based on the Portuguese courts' inability to assess and decide upon them, a decision which, having been appealed by ZOPT, was revoked by the Court of Appeal already in 2021 awaiting further developments, namely the judicial pronouncement on the seizures.

On 19 August 2020, Sonaecom communicated the intention of the shareholders of ZOPT (Sonaecom, Unitel International Holdings, BV and Kento Holding Limited) to liquidate the company, maintaining Sonaecom as the reference shareholder of NOS. To date, the efforts to dissolve the ZOPT have not yet been carried out.

In the last quarter of 2020, the seizure of 233,790,325 shares corresponding to 32.65% of capital of ZOPT held by UNITEL was also decreed, with deprivation of the exercise of voting rights and the right to receive dividends, and 124,234,675 shares corresponding to 17.35% of capital of ZOPT held by KENTO, also with no exercise of the right to vote and the right to receive dividends. Additionally, in January 2021, ZOPT was also notified by Caixa Geral de Depósitos (CGD), as the beneficiary of the pledge of the shares held by Kento in ZOPT, referring to being vested with the power to exercise the voting rights inherent in the shares, and all other inherent rights, and that Kento was deprived of exercising such rights without the prior, express and written authorization of CGD It is the understanding of the Board of Directors of ZOPT, that whenever there is no question of protecting the economic value of the shares, in the exercise of voting rights, CGD as Kento's pledge creditor, must act in accordance with Kento's instructions, which means voting in the sense defined by Kento.

Despite the facts described above considering that, no steps have yet been taken to liquidation of ZOPT, that there has been no change in the board of directors of ZOPT and that decisions on the operating activity of the investee company continue to be taken in accordance with what was being done, we concluded that the profile of joint control over the ZOPT has not changed.

ZOPT Group provisions

The evolution in provisions occurred during the first 9 months of 2021 compared to 31 December 2020 was as follows:

1. Actions by MEO against NOS S.A., NOS Madeira and NOS Acores and by NOS S.A. against MEO

The court ruled on 16 March 2021 and disregarded the remaining pre-scheduled dates for the final hearing. On the present date, we await the scheduling of new dates for the hearing. It is the understanding of the Board of Directors, corroborated by the attorneys accompanying the process, that it is, in formal and substantive terms, likely that NOS SA will be able to win the lawsuit, due to MEO already having been convicted for the same offences by ANACOM.

2. Interconnection tariffs

On 30 September 2021, there are accounts receivable and accounts payable include EUR 37,139,253 and EUR 43,475,093, respectively, resulting from a dispute between the subsidiary NOS SA and, essentially, the operator MEO - Serviços de Comunicação e Multimédia, S.A. (previously named TMN - Telecomunicações Móveis Nacionais, S.A.), in relation to the non-definition of interconnection tariffs of 2001. In what concerns to that dispute with MEO, the result was totally favourable to NOS S.A., having already become final. In March 2021, MEO filed a new lawsuit against NOS, in which it claimed the price of interconnection services between TMN and Optimus for 2001 at 55\$00 (EUR 0.2743) per minute. NOS filed a defense at the beginning of June challenging the petition by MEO and at this moment, the deadline for carrying out the other procedural steps is currently running.

COVID-19

With the emergence, spread and infection of the new coronavirus COVID-19, several measures were taken to contain the virus with very significant estimated impacts on the Portuguese economy, as well as in other economies, namely, limitations on travel rights and closure of several facilities and establishments.

In the uncertainty of this threat, it is essential that companies design and implement, in a timely manner, structured and efficient contingency plans that guarantee employee protection and business continuity or that, at least, mitigate the resulting effects.

This is a situation of uncertainty and very dynamic, which makes it extremely difficult to estimate impacts, which always have to consider several scenarios and countless variables. Evidence of this difficulty is the historical drops and sharp volatility of exchanges, all over the World; the great variations that occurred in the last quarters of the future projections of macroeconomic indicators, as well as the disparity of these projections between the several entities.

NOS is committed to support their customers during the current COVID-19 public health crisis. At a time when many Portugueses are changing their habits and routines and working remotely, keeping customers connected is the main objective of NOS. To this end, NOS facilitate access to services, through data offers, suspension of monthly payment of premium sports channels, reinforcement of the ability to implement business services and guaranteeing a safe and secure service in our stores, in order to safeguard customers, employees and partners. The NOS Telecommunications Network supports a set of basic services of our society, which include our National Health System. In this context of global health emergency, the maintenance of Portuguese communications is a fundamental task.

The impacts on ZOPT through participation in NOS were felt in the results of the year 2020, with a drop in Revenues, EBITDA and operational Cash-Flows of - 6.2% (EUR - 90.5 million); - 5.7% (EUR - 36.8 million) and - 33.8% (EUR -65.2 million), respectively, which shows a reduction in activity in:

  • i. Cinemas and Audiovisuals: complete closure of NOS' theatres on 16 March to 2 July, and postponement of a number of movie premieres, slightly offset by cinema rentals negotiations;
  • $\ddot{\mathbf{h}}$ . Roaming and international calls: traffic and revenues impacted by restrictions imposed on international travel;

  • Equipment sales: with the closure of shopping centers and travel restrictions, there was a reduction in the sale of mobile iii. phones and equipment, which is partially offset by the increase in online sales (in the long run there may be a positive effect on the evolution customer take-up of digital channels);

  • Mobile data revenues: quarantine and isolation situations imply an increase in the use of wireless networks, reducing the iv. use of mobile data: and.
  • Drop in revenue related to premium sports during the period when the national championship was suspended and V. advertising content.

On the other hand, the projections made for the Portuguese economy, led to a reassessment of NOS projections and estimates, which resulted in the reinforcement, in the first half of 2020, of impairments, of accounts receivable (27.9 million euros) and other costs recognised, related to onerous contracts (10.8 million euros), as well as the recording of impairments in the item "Losses / (Gains) in subsidiaries", in the amount of 9.5 million euros. In line with the current recommendations, NOS proceeded to sensitivity analysis to the assumptions used in the impairment tests to Goodwill conducted in the end of 2020, with no evidence of impairment being concluded. The most affected segment by COVID-19 was the cinemas one, with a recovery estimation to pre-pandemic values in 2023.

In the nine months ended on 30 September 2021, the impacts on NOS were felt particularly in the Cinemas and Audiovisuals activity with the closure of movie theatres since mid-January 2021 until April 2021 and in the Telco segment with impacts in terms of roaming revenues.

Liquidity and interest rate risk

Prudent liquidity risk management implies maintaining an adequate level of cash and cash equivalents to meet assumed liabilities, associated with the negotiation of credit lines with financial institutions.

On 30 September 2021, the average maturity of the NOS group's financing is 2.4 years, with no non-compliance with the covenants due to the reduction in results projected for this year, being expected.

Credit risk

Credit risk is essentially related to credit for services provided to customers, monitored on a regular business basis and for which expected credit losses are determined considering: i) the customer's risk profile; ii) the average receipt period; iii) the client's financial condition; and iv) future perspective of the evolution of the collections.

In terms of the projection of future impacts at NOS, these will depend on the extent, namely timing, of the spread of the virus and the respective containment measures, making it difficult to predict the scale of the impact, in the knowledge, however, that it will occur in the areas mentioned above. NOS 'capital structure is within the 2x Net Financial Debt / EBITDA After Leasings Payments (EBITDA -Leasings Payments (Capital and Interest)) threshold, so the Board of Directors of NOS believes that the company will overcome the negative impacts caused by this crisis, without jeopardizing business continuity, this conviction is demonstrated with the maintenance of the shareholders' remuneration policy.

7. Financial assets at fair value through other comprehensive income

On 30 September 2021 and 31 December 2020, this caption was composed as follows:

30 September 2021 31 December 2020
Deepfence 2,159,075 2,037,325
Nextail 1,628,760 1,628,760
Style Sage 1,520,136 1,378,547
Iriusrisk 1,416,514 1,416,514
Sensei 405,900 405,900
Others 471,474 432,745
7,601,859 7,299,791

On 30 September 2021, these investments correspond to shareholdings in unlisted companies in which the Group has no significant influence.

According to IFRS 9 these investments are defined as 'Investments at fair value through other comprehensive income' as theu are held as long-term strategic investments and there is no expectation that these investments will be sold in the short and medium term, and, so, were irrevocably designated as investments at fair value through other comprehensive income. For investments with a maturity of less than a year the acquisition costs were considered as a reasonable approximation of their fair value. For investments with a maturity greater than a year the subsequent changes in fair value are presented through other comprehensive income. The fair value of the investments is calculated in the currency of the country of the investment and converted to euros at the end of the reporting period.

In the periods ended on 30 September 2021 and 2020, the change in investments at fair value through other comprehensive income was as follows:

30 September 2021 30 September 2020
(restated)
Opening balance 7,299,791 5,344,811
Acquisitions/Capital Increases 2,925,306
Fair value 302,169 547,832
Others (101)
Closing balance 7,601,859 8,817,949

StyleSage

Stylesage is a strategic analytics SaaS platform that helps fashion, home and beauty retailers and brands with critical pre, in and post season decisions globally. Every day, StyleSage pulls product data from competitors' ecommerce websites from around the world. Then, with groundbreaking technology in machine learning and visual recognition, StyleSage cleans, organizes, and analyzes the massive amounts of collected data into a cloud-based dashboard that empowers brands and retailers to make informed, data-driven decisions in areas such line planning, markdown optimization, and global expansion.

Nextail

Nextail is a Spanish company that has developed a cloud-based platform that combines artificial intelligence and prescriptive analytics to upgrade retailers' inventory management processes and store operations. The company raised a \$10.0 million Series A round led by London and Amsterdam based venture capital firm KEEN Venture Partners LLP ("KEEN"), together with Sonae IM and existing investor Nauta Capital. The new financing is being used to accelerate product development and double the size of the team, as it grows internationallu.

IriusRisk

IriusRisk (previously named Continuum Security) is a Spanish based company with an application security platform to address vulnerabilities early in the development process. In order to realise their international growth plans, the company has raised an investment round of EUR 1.5 million, which was led by Swanlaab Venture Factory and joined by JME Venture Capital and Sonae IM. In September 2020, the company raised a series A round of \$6.7 million participated by Paladin, 360 CP, Swanlaab JME Venture Capital and Sonae IM.

Deepfence

Deepfence is a leading US-based cloud-native workload protection platform that aims to provide a unified security platform for kubernetes, virtual machines and serverless workloads. Deepfence ensures business continuity in the face of persistent threats by detecting and disrupting sophisticated attacks targeting cloud-native technologies, the "glue" that keeps the current world connected. Deepfence raised \$9.5 million in Series A financing led by AllegisCyber, with participation from Sonae IM, and existing investor Chiratae Ventures.

8. Financial assets at fair value through profit or loss

On 30 September 2021 and 31 December 2020, this caption was composed as follows:

30 September 2021 31 December 2020
Arctic Wolf 24,442,888 46,129,113
Cellwise 8,452,792 7,976,141
Ometria 8,007,892 7,664,993
Sixgill 5,181,780 4,889,580
Citcon 4,318,150 $\sim$
Weaveworks 4,318,149 4,074,649
Jscrambler 3,828,724 1,550,000
Visenze 2,520,766 2,378,620
Sales Layer 2,500,358 2,500,358
Sellforte 2,500,000
Reblaze 2,374,983 2,241,058
Replai 2,293,897 600,000
Case on IT 2,244,546 4,402,087
CiValue 1,934,531 1,825,443
Taikai 1,836,895 350,000
Aryaka 1,369,362 $\sim$
Daisy Intelligence 1,124,363 1,050,496
CB4 3,278,059
Others 2,680,498 1,413,466
81,930,575 92,324,063

Investments not irrevocably designated in the initial recognition as 'Financial Assets at fair value for other comprehensive income', are classified as 'Investments at fair value through profit or loss' in accordance with IFRS 9. Are also included in this caption the investments in associated companies, held by a venture capital organization or equivalent, in which the Group opted, in the initial recognition to measure at fair value through results in accordance with IFRS 9. In the case of the investments of less than 1 year, their acquisition cost was considered a reasonable approximation of their respective fair value. For investments over 1 year, subsequent changes in fair value are presented through profit or loss. The fair value of the investments is calculated in the currency of the country of the investment and converted to euros at the end of the reporting period.

In the periods ended on 30 September 2021 and 2020, the change in investments through profit and loss was as follows:

30 September 2021 30 September 2020
(restated)
Opening balance 92,324,063 53,022,211
Acquisitions/Capital Increases 10,687,262 4,216,997
Fair value 6.469.315 29,345,076
Exits (27,550,065)
Closing balance 81,930,575 86,584,284

On 30 September 2021, the heading "Exits" is related to the partial sale of Sonae IM 's stake in Arctic Wolf for the amount of EUR 36.4 million, which generated a capital gain of EUR 12.3 million and to the sale of the entire participation of Sonae IM in CB4 for the amount of EUR 8.5 million, which generated a capital gain of EUR 5.1 million.

In the periods ended on 30 September 2021 and 2020, the movement in net income was as follows:

30 September 2021 30 Sentembe
Gains and losses on assets at fair value through profit or loss 23.847.179 29.345.076
23.847.179 29.345.076

On 30 September 2021, the heading 'Gains and losses on assets at fair value through profit or loss' includes the amounts relating to the capital gains mentioned above.

ArcticWolf

Arctic Wolf, a US based company, is a global pioneer in the SOC-as-a-Service market with cutting-edge managed detection and response (MDR), which provides a unique combination of technology and services for clients to quickly detect and contain threats. Sonae IM, jointly with US technologu investors Lightspeed Venture Partners and Redpoint, entered in the companu's cap table in 2017 in a series B round. During 2018, the Company closed a \$45 million series C round and, at the end of 2019, the Company launched a \$60 million Series D round. In October 2020, the company announced it has raised \$200 million in Series E funding at a valuation of \$1.3 billion. The funding round was led by Viking Global Investors, with additional participation from DTCP and existing investors. Sonae IM participated in all rounds, reinforcing its stake.

Ometria

Ometria is a London based AI powered customer marketing platform with the vision to become the central hub that powers all the communication between retailers and their customers. This investment was done by Sonae IM in the Series A round, alongside several strategic investors (including Summit Action, the US VC fund of the Summit Series) and was recently reinforced during series B round.

CB4

CB4 is a company based in Israel that provides a patented AI software solution for brick and mortar retailers to identify and correct critical operational issues at store, product level. The investment was part of a series B \$16 million round, led by Octopus Ventures with Sonae IM joining. Existing investors Sequoia Capital and Pereg Ventures also participated in the round.

Reblaze

Reblaze is an Israeli company that provides proprietary security technologies in a unified platform, shielding assets from threats found on the Internet. The company raised a Series A round in which Sonae IM led jointly with JAL Ventures and Data Point Capital.

Visenze

Visenze is a Singapore-based company that delivers intelligent image recognition solutions that shorten the path to action as consumers search and discover on the visual web. Retailers use ViSenze to convert images into immediate product search opportunities. improving conversion rates. Media companies use ViSenze to turn any image or video into an engagement opportunity, driving incremental revenue. Sonae IM co-led, with Gobi Partners, a \$20 million Series C round that will enable the artificial intelligence company to further invest in its penetration among smartphone manufacturers, as well as with consumer and social communication applications.

Daisy Intelligence

Daisy Intelligence is an AI-powered platform for retail merchandising teams focused on optimizing promotional product and price mixes for dramatically improved business results. Sonae IM partnered with Framework Venture Partners invested in a C\$10 million (circa EUR 7 million) series A round.

Sixgill

Sixgill is a market leader in deep and dark web cyber threat intelligence. Sixgill helps Fortune 500 companies, financial institutions, governments, and law enforcement agencies protect their finances, networks and reputations from cyberthreats that lurk in the deep, dark and surface webs. The advanced cyber threat intelligence platform automates all phases of the intelligence cycle - collection, analysis and dissemination of data - providing organizations with unparalleled information and actionable insights to protect their

various assets in the ever-evolving cyber threatscape. Sixgill raised \$15 million in a second round led by Sonae IM and REV Venture Partners with participation by Our Crowd. Previous investors Elron and Terra Venture Partners also participate in the round.

Case on IT

Case on IT is a Spanish company that has developed Medux, a machine learning solution for the measurement, prediction and analysis of landline, mobile and television services quality. Medux measures the customer experience in markets that collectively serve over 600 million users worldwide.

ciValue

ciValue is an Israeli company with offices in New York, Paris, and Tel Aviv, is a disruptive provider of cloud-based Precision Marketing and Supplier Advertising Platforms for Retailers. Sonae IM, coupled with Nielsen, led a \$6 million Series A investment.

Cellwize

Cellwize is a leading provider of Mobile Network Automation and Orchestration solutions for telco, based in Israel. Cellwize offers modular solutions for an agile adoption of 'zero-touch' network automation capabilities on top of a virtualized service orchestration platform. It supports network operations, especially given the increase in network density and complexity driven by 5G adoption. Sonae IM invested in a round of \$15 million led by Deutsche Telekom Capital Partners. In November 2020, the company announced a \$32 million Series B funding round led by Intel Capital and Qualcomm Ventures LLC with participation from Verizon Ventures, Samsung Next, and existing shareholders.

Jscrambler

Iscrambler is a Portuguese startup that develops a security solution to protect Web and Mobile Applications (Javascript code). The company raised a \$2.3 million in a series A financing round that was led by Sonae IM with the co-investment of Portugal Ventures. In 2021, the Companu raised 10 million euros in a series A with the participation of Ace Capital Partners.

Sales Layer

Sales Layer is a Spanish based company with a cloud-based Product Information Management (PIM) platform, helping brands and retailers to transform their catalogs into a digital, enriched, and multichannel control center. Sonae IM recently led its series A round.

Weaveworks

Weaveworks is a US company that helps teams to adopt cloud native computing, managing cloud native infrastructure and applications quickly, reliably and at scale. Weaveworks announced a \$36.65 million Series C funding round led by some of the world's leading public cloud and telecommunications companies, including first-time investors Amazon Web Services (AWS), Ericsson, Orange Ventures, Sonae IM and Telekom Investment Pool (TIP). The round also included follow-on investments from Accel, GV, and Redline Capital.

Sellforte

Sellforte, based in Helsinki, Finland, is a SaaS platform for Retailers, Brands and Telcos, which uses proprietary data science and AI to measure the effectiveness of online and offline marketing investments.

Portainer

New Zealand-based Portainer.io is one of the world's most popular container management platforms. Portainer's universal platform makes it easy to manage applications in container environments.

Aruaka

Aryaka, founded in 2009, is a pioneer in offering long-distance connectivity in a service model, taking on the mission of connecting organizations globally while maintaining application performance as well as operational simplicity.

Citcon

Citcon, is a US-based leading mobile wallet payment provider with a fintech platform that enables seamless global commerce at scale by connecting the world's businesses with more than 100 mobile wallets, local and alternative payment methods. Citcon raised \$30 million in Series C financing led by Norwest Venture Partners and Cota Capital with the participation of Sonae IM and Sierra Venture.

9. Sales and services rendered

On 30 September 2021 and 2020, this caption was composed as follows:

30 September 2021 30 September 2020
(restated
Technologies 42,939,214 40,497,710
Media and others 10,754,878 10,408,579
53,694,092 50,906,289

The detail of unrecognised revenue related to performance obligations of contracts with customers not satisfied in the period ended on 30 September 2021, by type of contract and according to its duration, is as follows:

Contract with customer duration
2021 2022 2023 >2023 Total
Technologies:
Cybersecurity 4,116,778 9,939,678 7,076,783 1,319,016 22,452,255
Total revenue from contracts with customers 4,116,778 1,319,016
22,452,255

10. Discontinued units

Bizdirect

In the periods ended on 30 September 2021 and 2020, the net income and cash flows from discontinued operations can be detailed as follows:

(Amounts expressed in Euro) June 2021 September 2020
(restated)
Sales 20,678,415 44,506,149
Services rendered 2,574,960 4,090,614
Other income 10,861 5,625
23,264,236 48,602,388
Cost of sales (19, 715, 473) (43,270,273)
External supplies and services (1,773,679) (2,315,640)
Employee benefits expense (1,780,393) (2,382,353)
Depreciation and amortisation (150, 359) (240, 839)
Other expenses (5,823) (4,369)
(23, 425, 727) (48,213,474)
Other financial expenses (15, 575) (44,798)
Other financial income 18,685 9.442
Current income / (loss) (158, 381) 353,558
Income taxation 27,562 (100, 135)
Consolidated net income/(loss) for the period of discontinued operations (130, 819) 253,423
Gain/ (loss) resulting from the alienation 5,401,927
Attributed to:
Non-controlling interests (discontinued operations) (32,705) 63,102
Cash flows from operating activities (1) (903, 596) 2,803,896
Cash flows from investment activities (2) (14, 112) (38,172)
Cash flows from financing activities (3) (118, 474) (879,573)
Net cash flows $(4)=(1)+(2)+(3)$ (1,036,181) 1,886,151

The net result for the period ended on 30 June 2021 corresponds to the net result generated by Digitmarket in the amount of negative EUR 130,819 and to the gain resulting from its sale in the amount of EUR 5,401,927 (Note 5.c).

11. Related parties

During the periods ended on 30 September 2021 and 2020, the balances and transactions maintained with related parties were mainly associated with the normal operational activity of the Group and to the concession and obtainment of loans.

The balances and transactions with related parties during the periods ended on 30 September 2021 and 2020 were as follows:

Balances at
30 September 2021
Accounts receivable Accounts payable Treasury applications Other assets Other liabilities
Parent Company (Sonae SGPS) 2,724,611 9,612,009 380,730 18,420
Companies jointly controlled 493.749 317,088 $\,$ 260,245 217,619
Associated companies 152,385 8,250 $\overline{a}$ 2,055,918 1,362,137
Others related parties 2,450,402 90.627 137,245 236,128
5,821,147 10.027.975 2,834,138 1,834,304
Balances at
30 September 2020
(restated)
Accounts receivable Accounts payable Treasury applications Other assets Other liabilities
Parent Company (Sonae SGPS) 2,683,654 660,673 979,627 18,492
Companies jointly controlled 1,176,165 453,787 5.638 1,273,285 1,039,475
Associated companies 3,927 4,149,804
Others related parties 1,855,821 211,357 205,302 196,367
5,715,639 1,329,744 5.638 6,608,018 1,254,333
Transactions at
30 September 2021
Sales and services Supplies and services Interest and similar Interest and similar Supplementary
rendered received income expense income
Parent Company (Sonae SGPS) 75 247,083 320,569
Companies jointly controlled 1,960,889 578,031 165,072
Associated companies 53.830 38.370 5,100
Others related parties 1,451,187 620,744 . 68.442 $\sim$
3 412 151 PRA PPA 1 358 938 68442 170 172
Transactions at
30 September 2020
(restated)
Sales and services
rendered
Supplies and services
received
Interest and similar
income
Interest and similar
expense
Supplementary
income
Parent Company (Sonae SGPS) 42.755 244.421 420.188
Companies jointly controlled 2.177.288 482,665 68 175,500
Associated companies 332 87,693 48,037
Others related parties 1,073,074 754.524 15,371
3.293.117 1.481.942 507.950 15.371 223.537

During the period ended on 30 September 2021, the company distributed as dividends the amount of EUR 7,859,228 to Sonae (EUR 6,724,906 in 2020) and EUR 18,824,123 to Sontel BV (EUR 16,107,239 in 2020).

The transactions between Group companies were eliminated in consolidation, and therefore are not disclosed in this note.

All the above transactions were made at market prices.

Both accounts receivable and payable with related parties will be paid in cash and have no guaranties attached.

During the periods ended at 30 September 2021 and 2020, no impairment losses have been recognised as accounts receivables of related parties.

12. Segment information

In the periods ended on 30 Sepetmber 2021 and 2020, the following business segments were identified:

  • Media:

  • Technologies; and

  • Holding activities.

These segments were identified taking into consideration the following criteria/conditions: the fact of being group units that develop activities where we can separately identify revenues and expenses, for which financial information is separately developed and their operating results are regularly reviewed by management and over which decisions are made. For example, decisions about allocation of resources, for having similar products/services and also taking into consideration the quantitative threshold (in accordance with IFRS 8).

The segment 'Holding activities' includes all the operations of the parent company that have as their main activity the management of shareholdings.

Excluding the ones mentioned above, the remaining activities of the Group have been classified as unallocated.

Inter-segment transactions during the years ended on 30 September 2021 and 2020 were eliminated in the consolidation process. All these transactions were made at market prices.

Inter-segment transfers or transactions were entered under the normal commercial terms and conditions that would also be available to unrelated third parties and were mainly related to interest on treasury applications and management fees.

Overall information by business segment on 30 September 2021 and 2020, prepared in accordance with the same accounting policies and measurement criteria
adopted in the preparation of the consolidated financial statements,

Media Technologie: Holding Activities Subtotal Eliminations and others Total
September 21 September 2020 September 21 September 2020
(restated)
September 21 September 2020 September 21 September 2020
(restated)
September 21 September 2020
(restated)
September 21 September 2020
(restated)
Revenues:
Sales and services rendered 10,577,319 9,938,488 42.939.214 40.351.710 292,500 256,875 53.809.033 50,547,073 (114, 941) 359.215 53.694.092 50,906,288
Other income 406.581 333.540 1,011,548 999212 128,283 20.444 1,546,412 1353196 9.274 45.889 1,555,686 1399,089
Total revenues 10,983,900 10,272,028 43,950,762 41,350,922 420,783 277,319 55,355,445 51,900,269 (105, 667) 405.104 55,249,778 52,305,373
Depreciation and amortisation (509, 346) (911.760) (4, 554, 307) (5,153,400) (26, 476) (23,586) (5,090,129) (6.088.746) (251, 532) (304.476) (5, 341, 661) (6,393,222)
Provisions and impairment losses (162.416) (118,259) (12.080) (64, 138) (174.496) (182.398) (174.496) (182, 398)
Net operating income / (loss) for the segment (1,702,949) (2.751.701) (7, 554, 734) (7,475,769) (1, 290, 157) (1.033.693) (10, 547, 840) (11.261.163) 66,587 579.336 (10, 481, 253) (10,681,827)
Interest income 11,054 12,793 119.170 145,181 783.508 710,364 913,732 868,338 (450, 497) (268, 450) 463.235 599,888
Interest expenses (24, 504) (12.298) (698, 378) (657,217) (1, 201) (1.402) (724, 083) (670.917) 456,470 249.699 (267, 613) (421,218)
Gains and losses on financial assets at fair value through profit or loss $\sim$ 23,847,179 29.345.076 $\sim$ 23,847,179 29.345.076 23,847,179 29.345.076
Gains and losses in joint ventures and associated companies (15, 664) (45.700) 31, 385, 351 (9.029.155) 28,629,776 21387.528 59.999.463 12.312.673 59.999.463 12.312.673
Other financial results (10, 550) (8.985) 16.974 (759.022) (2,010,098) (1822.779) (2,003.674) (2.590.786) 1,965.544 1772,402 (38.130) (818.384)
Income taxation 531,101 626,929 (12, 237, 049) (3.846.826) 103.776 68,803 (11,602,172) (3,151,094) 72,910 35.763 (11, 529, 262) (3.115.331
Consolidated net income/(loss) for the period (1, 211, 512) (2.178.962) 34.878.513 7,722,268 26,215,604 19,308,821 59,882,605 24.852.127 2,111,014 2,368,750 61,993.619 27,220,877
Consolidated net income/(loss) for the period of discontinued operations ٠ - - 5,254,859 287,293 . . $\sim$ 5,254,859 287,293 16,249 (33,870) 5,271,108 253.423
Attributable to:
Shareholders of parent company (1, 211, 512) (2.178.962) 40.910.806 9,246,822 26.215.604 19.308,821 65,914,898 26,376,681 2,126,683 2.330,666 67.888.047 28,707.347
Non-controlling interests (744, 152) (1.165.725) (744, 152) (1.165.725) 153,537 (130.424) (590, 615) (1,296,149)
Non-controlling interests (discontinued operations) (33, 285) (71.536) (33, 285) (71.536) 580 134.638 (32,705) 63,102
September 2021 December 2020 September 2021 December 2020 September 2021 December 2020 September 2021 December 2020 September 2021 December 2020 September
2021
December 2020
Assets:
Tangible, intangible assets, Right of use and goodwill 2,866,806 2.948.598 27,694,669 29,755,984 78,239 70,200 30.639.714 32.774.782 2.309.297 2.631.165 32,949.011 35,405,947
Inventories 136,126 194.413 57,414 136,126 251,827 136.126 251,827
Investments in joint ventures and associated companies (restated) 677,955 693,619 145,007,335 144,065,913 693,088,962 662,983,184 838,774,252 807,742,716 70,648 52.944 838,844,900 807,795,660
Financial assets at fair value through other comprehensive income
(restated)
3,047,947 3.047.949 7.571.615 7,251,842 $\overline{\phantom{a}}$ 10.619.562 10,299.791 (3,017,703) (3,000,000) 7,601,859 7,299,791
Financial assets at fair value through profit or loss (restated) 81,930,575 92.324.063 $\overline{\phantom{a}}$ 81,930,575 92.324.063 81,930,575 92.324.063
Other non-current assets and deferred tax assets 3.070.710 2.924.374 12.369.332 13,714,766 149,731,553 176,955,566 165,171,595 193.594.706 (142, 236, 313) (169,611,538) 22,935,282 23,983,168
Other current assets of the segment 10.340.498 11,957,020 66,947,802 73,224,153 182,889,835 187,926,829 260,178,135 273,108,002 4.541.592 7.322.335 264,719,727 280,430,337
Liabilities
Liabilities of the segment 10,072,793 10,487,209 105.208.453 137,985,308 2,247,860 2.427.059 117,529,106 150.899.576 (21,077,081) (17,909,065) 96,452,025 132,990,511
CAPEX 436.924 6.093.911 14.981.920 24,885,132 11,697,925 46,518,317 27,116,769 77,497,360 (11,749,891) (49,428,786) 15,366,878 28,068,574

During the period ended on 30 September 2021 and 2020, the inter-segments sales and services were as follows:

Media Technologies Holding Activities
2021
Media 138,732
Technologies 56,250
Holding Activities
External trade debtors 10,577,319 42,939,214 97,518
10,577,319 42,939,214 292,500
2020 (restated)
Media $\overline{\phantom{a}}$
Technologies 120,000
Holding Activities
External trade debtors 9,938,488 40,351,710 136,875
9,938,488 40.351.710 256,875

During the periods ended on 30 September 2021 and 2020, sales and services rendered in the Media and Holding Activities segments were obtained predominantly in the Portuguese market, with this market representing approximately 95% and 100% (97% and 100% in 2020), respectively.

During the period ended on 30 September 2021, for the Technologies segment, the Spanish market is dominant, representing 49% of revenue (52% in 2020).

12. Subsequent Events

On 27 October 2021, the auction for the allocation of 5G frequencies ended and NOS was the company that invested the most and acquired the most spectrum, completely fulfilling all the objectives outlined in its strategy for the fifth generation of mobile networks.
NOS' total investment in the acquired spectrum bands represents a total value of ap of this amount for a maximum period of 7 years, and NOS may anticipate the payment of deferred amounts, benefiting from an update financial.

Sonaecom SGPS is listed on the Euronext Stock Exchange. Information is available on Reuters under the symbol SNC.LS and on Bloomberg under the symbol SNC:PL.

SAFE HARBOUR

This document may contain forward-looking information and statements, based on management's current expectations or beliefs. Forward-looking statements are statements that are not historical facts.

These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, including, but not limited "future" or similar expressions.

Although these statements reflect our current expectations, which we believe are reasonable, investors, analysts and, generally, the recipients of this document are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause
actual results and developments to differ materially from those expressed in, or implied or project

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