HOMETOGO SE

Annual Report (ESEF) • Apr 29, 2022

htg-2021-12-31-en 2221001IK1TS34BCHL372021-01-012021-12-31iso4217:EUR2221001IK1TS34BCHL372020-01-012020-12-31iso4217:EURxbrli:shares2221001IK1TS34BCHL372021-12-312221001IK1TS34BCHL372020-12-312221001IK1TS34BCHL372019-12-31ifrs-full:IssuedCapitalMember2221001IK1TS34BCHL372019-12-31ifrs-full:CapitalReserveMember2221001IK1TS34BCHL372019-12-31ifrs-full:RetainedEarningsMember2221001IK1TS34BCHL372019-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember2221001IK1TS34BCHL372019-12-31ifrs-full:ReserveOfSharebasedPaymentsMember2221001IK1TS34BCHL372019-12-312221001IK1TS34BCHL372020-01-012020-12-31ifrs-full:IssuedCapitalMember2221001IK1TS34BCHL372020-01-012020-12-31ifrs-full:CapitalReserveMember2221001IK1TS34BCHL372020-01-012020-12-31ifrs-full:RetainedEarningsMember2221001IK1TS34BCHL372020-01-012020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember2221001IK1TS34BCHL372020-01-012020-12-31ifrs-full:ReserveOfSharebasedPaymentsMember2221001IK1TS34BCHL372020-12-31ifrs-full:IssuedCapitalMember2221001IK1TS34BCHL372020-12-31ifrs-full:CapitalReserveMember2221001IK1TS34BCHL372020-12-31ifrs-full:RetainedEarningsMember2221001IK1TS34BCHL372020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember2221001IK1TS34BCHL372020-12-31ifrs-full:ReserveOfSharebasedPaymentsMember2221001IK1TS34BCHL372021-01-012021-12-31ifrs-full:IssuedCapitalMember2221001IK1TS34BCHL372021-01-012021-12-31ifrs-full:CapitalReserveMember2221001IK1TS34BCHL372021-01-012021-12-31ifrs-full:RetainedEarningsMember2221001IK1TS34BCHL372021-01-012021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember2221001IK1TS34BCHL372021-01-012021-12-31ifrs-full:ReserveOfSharebasedPaymentsMember2221001IK1TS34BCHL372021-12-31ifrs-full:IssuedCapitalMember2221001IK1TS34BCHL372021-12-31ifrs-full:CapitalReserveMember2221001IK1TS34BCHL372021-12-31ifrs-full:RetainedEarningsMember2221001IK1TS34BCHL372021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember2221001IK1TS34BCHL372021-12-31ifrs-full:ReserveOfSharebasedPaymentsMember HomeToGo SE (formerly Lakestar SPAC I SE) Combined Management Report for Financial Year 2021 1. Background to the Group 1.1. General HomeToGo SE, Luxembourg is a public European company (Société Européenne) that is listed on the Frankfurt Stock Exchange, having its registered office at 9, rue de Bitbourg, L-1273 Luxembourg, Luxembourg, and registered with the Luxembourg Trade and Companies Register (Registre de Commerce et des Sociétés de Luxembourg) under number B249273. This management report comprises both the Group management report and the management report of HomeToGo SE. Herein, we report on the business performance as well as the situation and expected development of HomeToGo Group (hereafter also referred to as "HTG", "Group" or "HTG Group") and HomeToGo SE (hereafter also referred to as "HTG SE" or "the Company"). 1.2. Business Model The HTG Group operates an international marketplace for vacation rentals, which connects millions of users in their search for a place to stay with thousands of inventory suppliers across the globe, resulting in the world’s most comprehensive inventory coverage in the alternative accommodation space. At the time of the report, the portfolio of HTG comprises more than 15 million aggregated accommodation offers provided by over 31,000 online travel agencies, tour operators, property managers and other inventory suppliers (“Partners”) worldwide. HTG operates its business through local websites and apps in 24 countries. The international market appearance is carried out through various brands, mainly HomeToGo, Casamundo, Wimdu, Tripping, Agriturismo, CaseVacanza, Smoobu and Escapada Rural. The marketplace integrates a vast inventory in one simple search and enables users to book accommodations from diverse partners, either on the partners’ external websites or directly on the HTG platform. Since March 2021, we offer our new software-as-a-service ("SaaS") product for semi-professional agencies and homeowners, which enables them to centrally control their listings and coordinate their actions across multiple platforms, we also effectively improve the quality and synchronization of the existing inventory for our Partners, in particular online travel agencies ("OTAs"), and grant them access to additional new inventory that otherwise would not be (easily) available to them. As an internet marketplace, HTG sees itself as an entry opportunity in the search for a vacation rental. With our on-site solution, there is an option to directly book with the connected partners via HTG. The use of the platform is thereby free of charge for users. Instead, HTG receives a commission from the connected booking partner for every successful mediation of a booking or for the generation of a query, respectively. 1.3. Group Structure On July 14, 2021, Lakestar SPAC I SE (hereafter also referred to as "Lakestar SPAC") and HomeToGo GmbH (hereafter also referred to as "HTG GmbH") that was the former parent company of HTG Group, entered into a business combination agreement (in the following referred to as "the Transaction") by way of contribution of all shares in HTG GmbH into Lakestar SPAC in exchange for the issuance of new public shares. The business combination was completed on September 21, 2021 and resulted after changing the name of Lakestar SPAC I SE in the new combined entity HomeToGo SE. The former parent company of HTG Group, HTG GmbH, was deemed to be both the accounting acquirer and the predecessor entity in the subsequent fillings of the 1 combined company. Therefore, HTG Group presents as comparative information, the financial information of former HTG GmbH Group as of December 31, 2020. See section 6 - Business Combinations and other acquisitions of the notes to the consolidated financial statements for further details on the business combination. HTG Group is managed by its ultimate parent company HTG SE and is operated under one segment. The Group comprises the parent entity, HTG SE, domiciled in Luxembourg, and its subsidiaries in Germany, Italy, Spain, Lithuania and the US. As of December 31, 2021, HTG SE had direct or indirect shareholdings in 15 companies, which belong to the Group and from which 13 are fully consolidated. Subsidiaries and Investments Location Share in capital HomeToGo GmbH Berlin, Germany 100% LS I Advisors Verwaltungs-GmbH Munich, Germany 100% LS I Advisors GmbH & Co. KG Munich, Germany 100% Casamundo GmbH Berlin, Germany 100% UAB HomeToGo Technologies Kaunas, Lithuania 100% UAB HomeToGo Technologies Vilnius Vilnius, Lithuania 100% Mertus 288. GmbH Berlin, Germany 100% HS Holiday Search GmbH Berlin, Germany 100% Feries S.r.l. Milan, Italy 100% Escapada Rural S.L. Barcelona, Spain 100% HOMETOGO INTERNATIONAL, INC. Wilmington, Delaware, USA 100% Smoobu GmbH Berlin, Germany 100% Mapify UG (haftungsbeschränkt) Kassel, Germany 100% SECRA GmbH Sierksdorf, Germany 19% SECRA Bookings GmbH Sierksdorf, Germany 19% 1.4. Management System The governing bodies of the Group are the Management Board, the Supervisory Board and the Shareholders’ Meeting of HomeToGo SE. Detailed information on the composition of Management and Supervisory Board can be found on the website of the company https://ir.hometogo.de/websites/hometogo/corporate- governance.html. The Management Board monitors and controls the Group’s development through a comprehensive reporting system. The Management Board reporting informs in detail on current developments in the operating business in the form of absolute and relative key figures. The Supervisory Board receives a monthly report including an income statement which provides a comprehensive picture of HTG Group’s economic position. Significant items and their changes are explained and discussed in detail in regular meetings between the management and the Supervisory Board. HTG's most important financial key performance indicators (KPIs) for the management of the group are revenues and Adjusted EBITDA (non-GAAP). Besides revenues Management Board uses Adjusted EBITDA because we believe that it provides useful information to investors and others in understanding and evaluating our results of operations, as well as provides a useful measure for period-to-period comparisons of our business performance. It is a key measure used by Management internally to make operating decisions, including those related to analyzing operating expenses, evaluating performance, and performing strategic planning and annual budgeting. Both metrics are outlined in the following table: 2 Revenues Revenues according to IFRS accounting policies. CPA revenues are recognized on check-in date. CPC + CPL revenues are recognized on booking or click date. Revenues from Subscriptions & Services are recognized over time or when services are provided. Adjusted EBITDA Net income (loss) before (i) income taxes; (ii) finance income, finance expenses; (iii) depreciation and amortization; adjusted for (iv) expenses for share-based compensation and (v) one-off items. One-off items relate to one-time and therefore non-recurring expenses and income outside the normal course of business. * unaudited In addition to the above, HTG also uses a range of further non-GAAP KPIs to manage its business. Management Board uses them to measure operating performance and as a basis for strategic planning, and because the Management believes that such non-GAAP KPIs will be used by investors and analysts to assess the performance of HTG. These further non-GAAP KPIs are described in the following table: Gross Booking Value (GBV) GBV is the gross EUR value of bookings on our platform in a reporting period (including all components of the booking amount except for VAT). GBV is recorded at the time of booking and is not adjusted for cancellations or any other alterations after booking. For CPA transactions, GBV includes the booking volume as reported by the Partner. For CPC, GBV is estimated by multiplying the total click value with the expected conversion rate. The total click value is the duration of the search multiplied with the price per night of the clicked offer. This total click value is multiplied with the average conversion rate of that micro conversion source for CPA Partners in the respective month. Bookings Bookings represent the number of bookings generated by users of the HomeToGo platforms. CPA Basket Size CPA Basket Size defined as CPA Gross Booking Value per booking, before cancellations. Take Rate Take Rate is the margin realized on the gross booking amount and defined as Booking Revenue divided by Gross Booking Value (excl. revenues from Hotels and Subscriptions & Services). Booking Revenues Booking Revenues is a non-GAAP operating metric to measure performance that is defined as the net Euro value before cancellations generated by transactions on the HTG platforms in a reporting period (CPA, CPC, CPL, etc.). Booking Revenues does not correspond to, and should not be considered as alternative or substitute for Revenue recognized in accordance with IFRS. * unaudited 1.5. Research & Development As a technology company, HTG undertakes development in view of optimizing the search intelligence and develops self-used IT modules. The technical platform, on the basis of which the Group’s websites and apps are operated, is an important differentiating factor compared to competitors, being continuously further developed in line with the requirements of the market and the expectations of the users. In-house and external experts engage with the continuous development of the platform. Our R&D work aims at achieving innovations that support a more convenient booking experience for our customers. Furthermore, we aim at ensuring our market leadership as the largest vacation home search machine in the world. In this regard, the Lithuanian subsidiaries, UAB HomeToGo Technologies and UAB HomeToGo Technologies Vilnius, which perform most of the development services for the HTG Group, play a major role. Over the past year, HTG continued to enhance its platform while the data warehouse technologies have also been upgraded to further increase self-service capabilities, speed, reliability, and observability of the data platform. HTG also consolidated technologies within the Group, enabling more of the brands to take advantage of the platform. 3 The Group’s direct R&D expenses in 2021 amounted to EUR 8,163 thousand (2020: EUR 6,002 thousand), resulting in a R&D rate of 9% in relation to HTG’s revenues (2020: 9%). The capitalization ratio amounts to 19% (2020: 23%) and amortization allocatable to capitalized R&D expenses amounted to EUR 542 thousand (2020: EUR 285 thousand). HomeToGo SE as an individual entity and pure financial holding does not conduct any operations related to research and development. 2. Report on Economic Position 2.1. Macroeconomic and Sector-specific Environment The market for alternative vacation rentals was still highly impacted by the ongoing Covid-19 pandemic in the financial year 2021, though to a lesser extent than to the previous year following a gradual relief of travel restrictions in Europe, North America and other parts of the world in spring. The overall development remained dynamic with the appearance of different Covid-19 variants that created multiple infection waves over the year. As measured by an increase of 5.9% of the global price-adjusted gross domestic product (GDP)1, economic development resurged in 2021 after a running into a recession in the previous year. While global Covid-19 vaccine adoption against new cases trended in the right direction, there were still large waves of new cases. However, because hospital resources are less constrained in North America and the EU, these countries are moving forward cautiously with easing travel restrictions. The Omicron variant introduced new uncertainty, though the world appeared to be transitioning to a mindset of living with the pandemic. The pandemic has changed travel patterns for much of 2020 and 2021, shifting when and how people book and travel. Large shifts out of urban centers towards traditional vacation destinations. People are taking longer 4 1 https://de.statista.com/statistik/daten/studie/197039/umfrage/veraenderung-des-weltweiten- bruttoinlandsprodukts/ trips. The shift to more remote work during the pandemic also allowed people to travel more and stay longer. One result of this has also been a faster recovery among short term rentals than hotels. Still, the online travel business and the business with alternative vacation rentals remains a growing market despite the ongoing pandemic. The entire addressable market is estimated to amount to more than EUR 1 trillion, being expected to reach more than EUR 1.7 trillion within the next decade.2 2.2. Business Development HTG KPIs Cockpit 2021 2020 2021 vs. 2020 Gross Booking Value (EUR thousands) 1,437,515 1,252,675 15% Bookings (#) 929,419 890,944 4% CPA Onsite 492,281 269,049 83% CPA Offsite 437,138 621,895 (30)% CPA Basket Size (EUR) 1,252 1,002 25% Take Rate 8.4% 6.4% 31% Booking Revenues (EUR thousands) 123,555 81,946 51% CPA Onsite 50,168 23,269 116% CPA Offsite 44,350 41,614 7% CPC + CPL 20,249 10,712 89% Subscriptions & Services 8,788 6,352 38% Booking Revenues onsite share 44% 31% 42% Cancellations (EUR thousands) (24,797) (18,917) 31% Cancellation Rate 20% 23% (13) IFRS Revenues (EUR thousands) 94,839 65,855 44% CPA Onsite 31,523 14,382 119% CPA Offsite 34,127 34,313 (1)% CPC + CPL 20,401 10,808 89% Subscriptions & Services 8,788 6,352 38% Adj. EBITDA (EUR thousands) (23,768) (2,421) 882% One-off items 2,698 (341) (891)% Adj. EBITDA excl. one-off items (21,070) (2,762) 663% Cash & cash equivalents + other highly liquid short-term financial assets (EUR thousands) 252,910 36,237 598% Equity (EUR thousands) 300,687 22,865 1215% Equity ratio 82% 22% 273% Employees (end of period) 417 302 38% * unaudited 5 2 Deutsche Bank Research, Airbnb – The air bed looks fully inflated, January 4, 2021, Exane BNP Paribas, Airbnb – Floating On Air, January 4, 2021 Although the global activity within the market for tourism and vacations in 2021 was remarkably decreased due to the ongoing pandemic HTG was able to close a successful business year and achieved a strong growth. The Group's revenue grew strongly by +44% to EUR 94,839 thousand in 2021. Booking revenues increased by 51% to EUR 123,555 thousand with an overall growing share of onsite bookings made directly on our platforms increasing to 44% from 31% in the previous year. Additionally, while we recorded approx. 321 million website visits in 2020, our 2021 increase to approx. 375 million stands for HomeToGo's brand awareness that has gradually increased, in particular over the last two years. At the time of the report, HTG managed to increase the number of partners to more than 31,000 (2020: 30,000) contributing to an inventory of more than 15 million offers (2020: 14 million) on the Group's platforms. With the acquisition of the Berlin based all-in-one vacation rental management software provider Smoobu GmbH, Berlin ("Smoobu") in March 2021 as well as our investment in SECRA Booking GmbH, Sierksdorf and SECRA Booking GmbH, Sierksdorf, we are enhancing our SaaS strategy and provide further technology solutions to the supply-side of our business operations. 2.3. Results of Operations, Financial Position and Net Assets The statements made on the net assets, financial position and results of operations of the HTG Group are based on the values and comparative figures of the consolidated financial statements for the financial year 2021, which have been prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the EU. More detailed explanations on the accounting and valuation methods applied can be found in the notes to the consolidated financial statements 2021. a) Results of operations Compared to the previous fiscal year, the Group's operating result has developed as shown in the following table: Reconciliation of operating result (in EUR thousands) 2021 2020 change Revenues 94,839 65,855 44% Cost of revenues (4,336) (2,792) 55% Gross profit 90,503 63,063 44% Product development and operations (23,726) (15,275) 55% Marketing and sales (95,495) (52,235) 83% General and administrative (112,751) (13,092) 761% thereof: Non-cash listing service expense (de-SPAC Charge) (70,437) — n/a Other expenses (626) (735) (15)% Other income 11,639 1,058 1000% Profit (loss) from operations (130,456) (17,216) (658)% 6 The following sections outline the development of individual income and expense items: Breakdown of revenues by activity areas (in EUR thousands) 2021 2020 CPA 65,650 48,695 thereof: CPA Onsite 31,523 14,382 CPA Offsite 34,127 34,313 CPC and CPL 20,401 10,808 Subscriptions & Services 8,788 6,352 Total 94,839 65,855 In the financial year 2021, the Group’s total revenues increased by more than EUR 28,984 thousand to EUR 94,839 thousand. While revenues from Subscription & Services are continuously growing, still, the major portion of the revenues was generated from CPA (“Cost per Action”), CPC (“Cost per Click”) and CPL (“Cost per Lead”) transactions. Overall, the growth in revenues is partly reflected by the resurgence in the travel industry in 2021. In addition, the increase is on the back of solid increase of 83% in onsite transactions and take rate and increased brand awareness. Increased revenues in Subscriptions & Services are mainly explained by the acquisition of the SaaS company Smoobu. Breakdown of expenses by functional areas (in EUR thousands) 2021 2020 Cost of revenues 4,336 2,792 Product development and operations 23,726 15,275 Marketing and sales 95,495 52,235 General and administrative 112,751 13,092 Other expenses 626 735 Total 236,934 84,129 The Group's 2021 costs are primarily driven by expenses for performance-marketing within our marketing and sales function and share-based compensation expenses that strongly impacted especially the general and administrative function. The reconciliation to adjusted EBITDA below provides a general overview of the impact of share-based compensation on the different cost functions. Cost of revenues increased by EUR 1,544 thousand or 55% from EUR 2,792 thousand in 2020 to EUR 4,336 thousand in 2021 due to higher expenses for hosting and higher amortization of self-developed software, partly also arising from the additional amortization of the fair value step-up from the acquisition of Smoobu. The increase in expenses for product development and operations by 55% to EUR 23,726 thousand in 2021 (2020: EUR 15,275 thousand) mainly results from higher expenses for share-based compensation (2021: EUR 8,260 thousand, 2020: EUR 3,170 thousand). Furthermore, our Product, Data and Engineer workforce has grown by 57% compared to the previous fiscal year leading to personnel-related expenses of EUR 9,435 thousand in 2021 compared to EUR 6,747 thousand in 2020. Marketing and sales expenses grew by 83% from EUR 52,235 thousand in 2020 to EUR 95,495 thousand in 2021. The majority of the increase was driven by EUR 40,656 thousand or 100% higher expenses for performance-marketing compared to prior year as spend was increased across all markets. In addition, there was stronger competition compared to prior year leading to higher bids and therefore higher expense. Besides, additional expenses incurred as HTG specifically targeted travelers to download the HTG app. This investment supported the strong growth in CPA onsite revenues. The increase in general and administrative expenses (2021: EUR 112,751 thousand, 2020: EUR 13,092 thousand) mainly results from share-based compensation (2021: EUR 88,038 thousand, 2020: EUR 3,395 thousand). The vast majority of this share-based compensation relates to the listing service expense of EUR 70,437 thousand which was recognized as part of the business combination that was treated as reverse 7 acquisition accounting-wise. This one-time non-cash expense reflects the excess of the fair value of shares issued by HomeToGo GmbH over the fair value of Lakestar SPAC I SE identifiable net assets acquired. Please refer to section 6 - Business Combinations and other acquisitions of the notes to the consolidated financial statements for further details. Additionally, general and administrative expenses have increased due to higher consulting expenses (2021: EUR 13,079 thousand, 2020: EUR 1,643 thousand) and expenses for service agreements with third parties (2021: EUR 1,829 thousand, 2020: EUR 1,155 thousand), both incurred in connection with the business combination. Personnel-related expenses in general and administrative increased year-on-year to EUR 6,803 thousand (2020: EUR 4,613 thousand), with the number of staff having increased. Other income increased due to government grant related income in 2021 of EUR 9.3 million (2020: EUR 0.4 million). EUR 8.6 million relate to income from a grant that is part of the Covid-19 aids by the German State. In 2021, the Group incurred a consolidated net loss in the amount of EUR (166,789) thousand compared to the 2020 result of EUR (23,806) thousand. The decrease compared to the previous period is strongly related to the aforementioned listing service expenses and non-recurring consulting expenses that was incurred as part of the business combination and shown in general and administrative. In order to assess the operating performance of the business, HTG's management also considers adjusted EBITDA. HTG recorded an adjusted EBITDA excluding expenses for share-based compensation and one-off items of EUR (21,070) thousand in 2021 compared to EUR (2,762) thousand in 2020. The decrease is mainly due to the higher marketing and sales expenses. Overall, the development of the Group’s result of operations are assessed favorable given the ongoing pandemic-related pressure on the travel industry. The derivation of the Group's adjusted EBITDA excluding one-off items is shown in the following table: Adjusted EBITDA reconciliation in EUR thousands 2021 2020 Profit (loss) from operations (130,456) (17,216) Depreciation and amortization 4,691 3,607 Share-based payment expenses 101,997 11,188 thereof: Listing service expense (Sponsor as well as public shares and warrants from de-SPAC) 70,437 — HTG Virtual Stock Option Program 31,560 11,188 thereof recognized in: Product development and operations 8,260 3,170 Marketing and sales 5,700 4,623 General and administrative 17,601 3,395 Adjusted EBITDA (23,768) (2,421) One-off items 2,698 (341) thereof: Business Combination 12,801 — Mergers and Acquisitions 533 12 Covid-19 related Restructuring — 63 Other 438 — Income from Government Grants (9,256) (416) Capitalized transaction costs under IFRS (1,818) — Adjusted EBITDA excl. one-off items* (21,070) (2,762) * unaudited 8 b) Financial position The following table provides an overview of the Group’s financial development: (in EUR thousands) 2021 2020 Cash and cash equivalents at the beginning of the year 36,237 36,237,000 10,972 Cash flow from operating activities (83,256) (11,309) Cash flow from investing activities (118,343) (4,649) Cash flow from financing activities 317,093 41,449 Foreign currency effects 1,213 (226) Cash and cash equivalents at the end of the year 152,944 36,237 As of December 31, 2021, the Group has cash and cash equivalents in the amount of EUR 152,944 thousand (2020: EUR 36,237 thousand). The financial development of the Group was primarily driven by the de-SPAC transaction. The decrease in cash inflow from operating activities is due to the cash settlement to beneficiaries of the HomeToGo Virtual Stock Option Program ("VSOP") in the amount of EUR 42,111 thousand. The increase in cash outflow from investing activities from EUR (4,649) thousand in 2020 to EUR (118,343) thousand in 2021 results mainly from the investment of EUR 100,000 thousand in a money market fund to minimise the impact of negative interest rates on regular bank accounts. Furthermore, the increase is explained by the acquisition of Smoobu, reflected in payment for acquisition of subsidiary, net of cash acquired in the amount of EUR (16,385) thousand. The increase in cash inflow from financing activities is mainly due to the collected proceeds of more than EUR 171,489 thousand resulting from the cash in Lakestar SPAC and from additional subscription agreements with investors in a private investment in public equity (“PIPE”) transaction in the aggregate amount of EUR 75,000 thousand. Furthermore, additional convertible loans with a combined principal amount of EUR 66,206 thousand have been issued in March and April 2021. Together with the other outstanding convertible loans these were already fully converted to equity prior to the de-SPAC transaction resulting in an increase in equity of EUR 146,277 thousand. Besides, the Group had also drawn down a bank loan of EUR 10,000 thousand in February 2021 that was already granted as of August 2020 for working capital financing. In addition to the financing from convertible loans in the past, HTG also uses external financing in the form of regular bank loans. The following table provides an overview on the outstanding loans within the Group as of December 31, 2021: Debtor Loan Amount (in EUR thousands) Payout date Maturity Nominal interest rate Carrying amount (in EUR thousands) HomeToGo GmbH 6,000 February 2020 December 2023 4.35% 3,000 HomeToGo GmbH 10,000 February 2021 September 2025 2.12% 8,414 Feries S.r.l. 400 August 2020 August 2025 1.50% 376 Escapada Rural S.L. 500 May 2020 June 2023 2.50% 337 Escapada Rural S.L. 300 May 2020 June 2025 1.55% 252 The HTG Group’s financial position can be stated as positive, especially against the backdrop of the successful business combination with Lakestar SPAC I SE. The Group has been able to meet its payment obligations at any time. Liquidity shortages have neither occurred nor are such shortages foreseeable for the future. 9 c) Net Assets (in EUR thousands) 31.12.2021 31.12.2020 change Non-current assets 85,962 24% 60,984 58% +24,978 +41% Current assets 279,321 76% 43,819 42% +235,502 + >100 % Total assets 365,284 100% 104,803 100% +260,481 + >100 % Equity 300,687 82% 22,865 22% +277,822 + >100 % Non-current liabilities 28,499 8% 66,745 64% (38,246) (57)% Current liabilities 36,098 10% 15,193 14% +20,905 + >100 % Total equity and liabilities 365,284 100% 104,803 100% +260,481 + >100 % As of the balance sheet date, the balance sheet total of the Group amounts to EUR 365,284 thousand (2020: EUR 104,803 thousand), with EUR 85,962 thousand (2020: EUR 60,984 thousand) accounting for non-current assets and EUR 279,321 thousand (2020: EUR 43,819 thousand) accounting for current assets. The main non-current assets are composed of intangible assets in the amount of EUR 61,360 thousand (2020: EUR 41,570 thousand) and property, plant and equipment in the amount of EUR 15,202 thousand (2020: EUR 16,413 thousand). The increase in intangible assets mainly results from the acquisition of Smoobu, resulting in the recognition of additional goodwill in the amount of EUR 14,664 thousand and trademarks, customer relationships and software in the amount of EUR 6,605 thousand. Property, plant and equipment slightly decreased due to depreciation that was not fully compensated by replacement investments. Moreover, the Group has purchased 19% shares each in SECRA GmbH and SECRA Bookings GmbH. Both investments are accounted for at fair value through profit and loss amounting together to EUR 3,597 thousand as of December 31, 2021. Current assets mainly relate to trade receivables including other receivables (2021: EUR 18,992 thousand, 2020: EUR 5,647 thousand) and cash and cash equivalents (2021: EUR 152,944 , 2020: EUR 36,237 thousand). The increase in trade receivables corresponds to the increased revenues. Furthermore, current other financial assets have increased to EUR 101,960 thousand as of December 31, 2021 from EUR 549 thousand as of the prior year due to an investment in short-term money market funds of spare cash resulting from the business combination to avoid negative interest. Current other receivables increased from EUR 505 thousand as of December 31, 2020 to EUR 9,237 thousand as of December 31, 2021 due to the government grant that was applied and received as part of the Covid-19 aids from the German state. As of December 31, 2021, the Group’s equity amounts to EUR 300,687 thousand (2020: EUR 22,865 thousand). Accordingly, the equity ratio amounts to 82% (2020: 22%) and is above the target equity ratio of 50%. The increase in the equity ratio compared to the prior year mainly results from the proceeds from shares issued as part of the business combination and the conversion of convertible loans to equity. Non-current liabilities decreased to EUR 28,499 thousand as of December 31, 2021 compared to EUR 66,745 thousand in the prior year mainly due to the conversion of convertible loans to equity in September 2021 prior to the business combination. Current liabilities amounted to EUR 36,098 thousand as of December 31, 2021 compared to EUR 15,193 thousand as of the prior year. The increase is explained by outstanding trade payables related to transaction fees incurred as part of the business combination. Furthermore, current liabilities as of December 31, 2021 contain the holdback amount of EUR 5,000 thousand for the acquisition of Smoobu that is due in 2022 as well as a customer with a credit balance EUR 2,564 thousand resulting from double-payment. d) Overall statement The Management Board views the overall business development of HTG as positive, specifically considering the negative impact of the Covid-19 pandemic. Overall, the net assets and financial position has been strongly improved by the business combination with Lakestar SPAC I SE. 10 GBV and take rate have developed in line with the expectations while the development in booking revenues and revenues has exceeded the expectations by the Management Board due to a strong fourth quarter. The negative adjusted EBITDA was expected due to the increased expenses for performance-marketing as well as the additional expenses as a result of being public. 2.4. Employees In 2021 the Group had employed on average 372 employees (2020: 269), representing an increase of 38% compared to the prior year. The overall increase is explained by the Group's expansion of business activities. The strongest increase was recorded in the Product, Data and Engineer Teams (57% in 2021). In addition, the head count increased in connection with the acquisition of Smoobu. 3. Statutory Results of Operations and Financial Position of the Company Until the Transaction, the Company’s sole purpose was the acquisition of an operating business with principal business operations in a member state of the European Economic Area or the United Kingdom or Switzerland that is based in the technology sector through a merger, capital stock exchange, share purchase, asset acquisition, reorganization or similar transaction. After the closing of the Transaction, the Company’s purpose is the creation, holding, development and realization of its investment in HTG GmbH. Results of Operations As pure financial holding the Company did not generate any revenues or income during the fiscal year 2021. The Company incurred expenses of EUR 17,740 thousand in 2021 (2020: EUR 1,044 thousand) that led to a loss in the same amount in the respective period. The expenses in 2021 mainly compose of underwriting fees (EUR 9,000 thousand) for the initial public offering ("IPO") in February, 2021 as well as for the admission of the newly issued shares as part of the de-SPAC transaction in September 2021. The remaining expenses mainly incurred in relation to the preparation of de-SPAC process as well as from consulting, accounting and auditing. Financial Position As of December 31, 2021, the Company had cash and cash equivalents of EUR 2,906 thousand compared to EUR 738 thousand in the previous year. During the fiscal year 2021, the Company had raised EUR 275,000 thousand of equity funds as part of an IPO and from additional subscription agreements with investors in a private investment in public equity (“PIPE”) transaction in the aggregate amount of EUR 75,000 thousand. As part of the consumption of the Transaction, shares in the amount of EUR 102,692 thousand had been redeemed and are now held as treasury shares. After the Transaction, redemptions in the amount of EUR 100,627 were paid out and the major part of the remaining funds have been transferred to HomeToGo GmbH by means of a capital contribution in the amount of EUR 237 million. The Company was able to meet its payment obligations at all times. No liquidity shortfalls have occurred or are foreseeable in the future. 11 Net Assets (in EUR thousands) 31.12.2021 31.12.2020 change Non-current assets 1,088,637 91% 31 4% +1,088,606 + >100 % Current assets 106,295 9% 738 96% +105,557 + >100 % Total assets 1,194,931 100% 768 100% +1,194,163 + >100 % Equity 1,193,118 100% (924) (120)% +1,194,042 - < 100 % Non-current liabilities — —% 1,500 195% (1,500) + >100 % Current liabilities 1,813 —% 192 25% +1,621 + >100 % Total equity and liabilities 1,194,931 100% 768 100% +1,194,163 + >100 % Non-current assets are composed of the Company's investments whereas the increase during the fiscal year is the result of the Transaction. The book value of the investment in HTG GmbH amounts to EUR 1,088,080 thousand as of December 31, 2021. Current assets comprise 10,269,314 treasury shares in the amount of EUR 102,692 thousand (December 31, 2020: EUR 0) and cash and cash equivalents of EUR 2,906 thousand (December 31, 2020: EUR 738 thousand). 4. Risk and Opportunity Report 4.1. Risk and Opportunity Management System The Management Board of HTG SE assumes overall responsibility for the development and operation of an effective risk and opportunity management system (RMS) for HTG. The CFO has implemented the RMS that consists of the following elements: Risk and Opportunity Objectives The objective of the RMS is to create the necessary transparency about risks and opportunities for decision makers, to foster the risk and opportunity culture, and to create a common understanding of risks and opportunities throughout the company. Risk and Opportunity Identification and Monitoring Using multiple instruments, such as workshops and self-assessments, the identification and assessment of risks and opportunities is carried out by both the risk and opportunity owners during day-to-day operations and the CFO on a quarterly basis. Risk and Opportunity Assessment All risks and opportunities identified are evaluated with regard to their probability of occurrence and their potential impact based on a one-year time horizon. The identified single risks and opportunities are finally aggregated. The probability of occurrence represents the possibility that a specific impact for a risk or an opportunity may materialize within the next 3 to 60 months. The impact assessment is conducted on a quantitative scale that refers to the potential financial impact. The material risks and opportunities are described in the next section of this report. Risk and Opportunity Control Risk and opportunity owners are charged with developing and implementing effective risk mitigating and opportunity supporting measures within their responsibility area. Depending on the type, characteristics, and 12 assessment of the risks, different risk strategies are applied by the risk owners to reduce the risk, considering costs and effectiveness. Risk strategies can be risk avoidance, reduction, transfer to a third party, or acceptance. Risk and Opportunity Management Improvements and Reporting The respective risk owner reports on the overall risk and opportunity situation to the senior management, the Management Board, and the Supervisory Board on a quarterly basis. 4.2. Illustration of Risks As at the time of the publication of the combined management report, governments, in particular in Europe, are further lifting measure such as social distancing, duty to wear face masks in public institutions or contact restriction regimes previously aimed at containing the spread of Covid-19. Although these measures are being lifted, there still exists a risk that the pandemic will resurge e.g. in the form of other virus variants and due to limited efficacy of existing vaccines against those variants. We expect that complete normality with unrestricted traveling will only be possible again in the medium term. HTG will continue to flexibly respond at short notice to any new development, as the Group has already done since 2020 when the pandemic occurred. Overall, the risks associated with the Covid-19 pandemic are not classified as a threat to HTG's continued existence as the business has now proven its resilience multiple times. The main operational risks relate to the areas of IT and marketing. The business model of the HTG Group is strongly based on the functionality of the IT systems and therefore exposed to IT risks. Errors or malicious external interference may threaten business processes. For this reason, we use state-of-the-art server solutions scalable by specialized third-party providers and recruit experts in order to ensure system integrity and safety and reduce the IT risks to an acceptable level. Appropriate measures also comprise an authorization concept that regulates which employee has access to which internal data and services. Another risk factor, in addition to the IT infrastructure, is the reachable efficiency and effectiveness of marketing expenses. There is a risk of increased user acquisition costs as competition with direct and indirect competitors in online marketing channels is intensifying. HTG counters this with investments in the brands of the HTG Group, which are, for example, geared to the main brand, HomeToGo. For example, through the evaluation of organic search results, targeted CRM campaigns are launched or TV and outdoor advertising is placed in order to increase the efficiency of the marketing measures applied and to reduce the dependency on individual online marketing channels. Our business depends on our partners maintaining their offers on our platform and engaging in practices that encourage users to book those offers. If partners do not establish or maintain a sufficient number of offers and availability for their properties, the number of nights booked declines for a particular period, or the price charged by partners declines, our revenue would decline and our business, results of operations, and financial condition would be materially adversely affected. While we plan to continue to invest in our partners and in tools to assist partners, these investments may not be successful in growing our partners and offers on our platform. In addition, partners may not establish or maintain offers if we cannot attract prospective users to our platform and generate bookings from a large number of users. While HTG has experienced only a limited number of contract terminations by partners in the past, partners have from time to time taken their inventory temporarily off its websites, e.g., for technical reasons. Since our key partners, in particular OTAs, typically operate their own platforms and/or also use the services of other platforms, we face the risk that a key partner may decide to suspend or terminate its partnership with us. Such decisions can be based on factors that are beyond our control. For example, a key partner may decide to reduce spending on services from us due to a challenging economic environment or other factors, both internal and external, relating to its business. These factors, among others, may include corporate restructuring, pricing pressure, changes to an outsourcing strategy, or switching to another platform. Furthermore, our reliance on certain key partners for a significant portion of our revenue may give these partners a certain degree of pricing leverage against us when negotiating contracts and terms of service. The loss of all or a portion of our business with, or the failure to retain a significant amount of business with, any of our key partners could have a material adverse effect on our business, financial condition and results of operations. 13 Due to the continuing loss situation, there is generally a medium-term liquidity risk. Furthermore, a default risk exists in respect of our partners’ receivables, which might also adversely affect liquidity. Given the size of our partners (partly listed companies), we regard a default of large partners as unlikely. A slightly higher default risk arises from small and non-professionalized partners, which is treated through consistent follow-up care. Overall, this refers to a minor volume and does not adversely affect HTG’s further existence. The Group has strong liquidity resources at its disposal following the business combination in September 2021 and an effective liquidity management. In the financial year, based on its robust business model, it has proven that it has been able to attract new investors and procure fresh capital in the capital market even in times of a pandemic. We offer our partners and users integrated payments in more than 28 currencies and a considerable portion of our business is conducted in foreign currencies. Therefore, we are exposed to a certain currency risk. HTG counters this currency risk through natural hedging of the main foreign currencies (primarily USD and GBP) by keeping bank accounts in the corresponding foreign currency in order to always be able to hold a stock of foreign currency in this way and not to be exposed to short-term currency fluctuations. We operate websites and apps through which we collect, maintain, transmit and store information about our users, Partners and others, including credit card or other financial information and personal information, as well as other confidential and proprietary information, including information related to intellectual property. We also employ third-party service providers that store, process and transmit proprietary, personal and confidential information on our behalf. Furthermore, we rely on encryption and authentication technology licensed from third parties in an effort to securely transmit confidential and sensitive information, including credit card details. While we have a cyber-risk management in place and take extensive steps to protect the security, integrity and confidentiality of sensitive and confidential information (e.g., password policies and firewalls), our security practices may be insufficient and third parties may breach our systems (e.g., through Trojans, spyware, ransomware or other malware attacks, or breaches by our employees or third party service providers), which may result in unauthorized use or disclosure of information. Such attacks might lead to blackmail attempts, forcing us to pay substantial amounts to release our captured data or resulting in the unauthorized release of such data. Given that techniques used in those attacks change frequently and often are not recognized until launched against a target, it may be impossible to properly secure our systems. In addition, technical advances or a continued expansion and increased complexity of our IT-infrastructure could increase the likelihood of security breaches. The operation of our business requires a number of licenses and other (usage) rights, e.g., in connection with integrating content into our platform. In the future, we may require additional licenses (e.g., if legal environments change or we provide additional services). There is, however, no guarantee that we will be able to obtain all required licenses or other (usage) rights or that we will manage to comply with all requirements imposed on us thereunder. If we fail to obtain and maintain such licenses or rights, we may not be able to conduct our business as intended, which may adversely affect our growth and profitability. Our employees’ expertise and commitment are important factors for our successful development and the management of opportunities and risks. Therefore, our success largely depends on our ability to recruit, train, motivate and retain highly qualified employees and, at the same time, promote our corporate culture. A shortage of qualified and motivated staff, primarily in key positions, might adversely affect our development and growth and increase our costs. We are competing for qualified staff, e.g., in the field of software developers. The loss of qualified staff, high employee fluctuation or lasting difficulties in filling vacant positions with suitable applicants might adversely affect our ability to effectively compete in our business, and we might lose important know-how, or our competitors might gain access to such know-how. In order to attract and retain qualified staff, we offer competitive compensation packages with long-term incentive models and other employer benefits, which serve the professional and health promotion of our employees. Furthermore, we strongly invest in our corporate culture and the development and further training of our employees. Legislative and regulatory authorities or other policy-making organizations in other countries where we operate may expand the scope of application of laws and regulations in force, enact new laws or regulations or issue revised rules or guidelines on data privacy and consumer protection. For example, it is expected that the European Commission initiative for a Digital Single Market (DSM) will lead to additional regulations for e- commerce or data protection, information security and privacy protection, which might increase our costs for the compliance with such regulations or require necessary adjustments to our business model. Several governments have also introduced regulatory requirements for platforms offering short-term rentals and will probably continue to do so. Those regulations are enacted worldwide with the intention to control and restrict the renting of private accommodations, which leads to a large number of regulations that we have to observe and comply with. Such laws may result in higher legal costs and necessary resources, depending on the individual market and jurisdiction. HTG counters these regulatory risks by ongoing monitoring and early 14 recognizing political developments, which might lead to an adjustment of our business model or our technology. In addition, HTG is engaged in industry associations, such as the Deutscher Ferienhausverband e.V. (DFV) and actively advocates the EU-wide harmonization of the regulation on short-term renting (e.g., by preparing and submitting position papers). HTG has acquired multiple businesses since 2018 and we will continue to regularly evaluate potential acquisitions. We may expend significant cash or incur substantial debt to finance such acquisitions, which indebtedness could result in restrictions on our business and significant use of available cash to make payments of interest and principal. In addition, we may finance acquisitions by issuing equity or convertible debt securities, which could result in further dilution to our existing stockholders. We may enter into negotiations for acquisitions that are not ultimately consummated. Those negotiations could result in diversion of management time and significant out-of-pocket costs. If we fail to evaluate and execute acquisitions successfully, our business, results of operations, and financial condition could be materially adversely affected. In addition, we may not be successful in integrating acquisitions or the businesses we acquire may not perform as well as we expected. While our acquisitions to date have not caused major disruptions in our business, any future failure to manage and successfully integrate acquired businesses could materially adversely affect our business, results of operations, and financial condition. In summary, Management believes, in view of the risk situation in the reporting period, no risks have been identified that could endanger the Company’s and the Group’s ability to continue as a going concern and, from today’s perspective, no such risks are recognizable for the foreseeable future. 4.3. Illustration of Opportunities The market for alternative vacation rentals had been the fastest growing segment of the online travel industry already prior to the Covid-19 pandemic. We assume that this market, as a result of a general shift of the travelers’ preferences from traditional hotel and resort bookings towards the rental of vacation homes, which has even been accelerated by the Covid-19 pandemic, will experience considerable growth. In the last two years, many citizens spent their vacation in their home countries according to their governments’ recommendations, which, in our opinion, will lead to a long-term trend towards domestic traveling also in the future and an increase in demand for alternative vacation rentals. Moreover, the increasing awareness in respect of the ecological impact of air travel contributes to the general trend to prefer domestic or nearby vacation destinations. With its innovative platforms and an increasing number of users and website visitors, HTG aims at successfully serving this market segment also in the future. In addition, increasing digitization of this privately and semi-professionally operated segment of the tourism sector will open up new market fields, in which HTG will offer its customers and users a fully integrated product portfolio, with customized products and software-based solutions, in order to continue its previous growth path in a sustained manner. In particular faster recovery from Covid-19 restrictions can lead to additional demand in the shoulder seasons. Further expansion of workation is expected as consumers are adding additional days before or after their holidays and just work from away. During the Covid-19 pandemic the cancellation rate has increased, in particular in 2020. Since then it has decreased, however, it is still above the historic average. A faster than expected return to historic cancellation rates can lead to additional revenues. Faster implementation of our software solutions can lead to faster digitalization of inventory and therefore benefit the whole alternative accommodation industry. Increased competition among our partners can lead to better economics for HTG as the partners want to have a higher traffic share. 5. Significant Events after the Reporting Period In February 2022, a number of countries (including the US, the UK and the EU) imposed sanctions against certain entities and individuals in Russia and Belarus as a result of the official recognition of the Donetsk People Republic and Luhansk People Republic by the Russian Federation. Announcements of potential additional 15 sanctions have been made following military operations initiated by Russia against Ukraine on February 24, 2022. Due to the war in Ukraine, there has been a significant increase in volatility on the securities and currency markets. It is expected that these events may affect the activities of Russian enterprises in various sectors of the economy, but also the economy of sanctioning countries and people in those countries as well. The Management Board regards these events as non-adjusting events after the reporting period. Although neither HTG's performance and going concern nor operations, at the date of this report, have been significantly impacted by the above, the Management Board continues to monitor the evolving situation and its impact on the financial position and results of the company. The indirect impact of the war in Ukraine and its implications, such as a potential change in travel behavior, cannot be quantified at this point in time. 6. Outlook The business started very strong into 2022 with significantly higher booking revenues than in 2021 at the same period. At the time of publishing this combined management report, we can already observe an increased demand for alternative vacation rentals compared to previous years. The travel market will still be impacted by Covid-19 and might not return to its pre-pandemic state in the short- term view. While in parts of Europe and North America most restrictions have been lifted a new wave of Covid-19 seems to build up in Asia which could impact the global economy and could lead to new travel restrictions. The Group will continue its growth path of 2021 both organically and non-organically by satisfying our customers' and partners' needs with the help of new products and technical solution and further by acquisition activity which will partly be financed with the proceeds from the business combination. We will also continue to invest in our onsite business, both in Europe and North America. The direct impact of the war in Ukraine is expected to be minimal as both the Ukrainian and Russian markets are of little importance for HTG. Both in terms of travel destination as well as bookings. However, the indirect impact of the war such as a potential change in travel behavior, and its implications on energy cost and consumer confidence cannot be quantified at this point in time, in particular not in case the war would involve additional countries. It is expected that inflation in 2022 will rise to the highest level since decades, in particular driven by higher energy cost. These higher costs could lead to a reallocation of consumer spending towards food, heating and transportation. For the fiscal year 2022, the HTG Group expects to grow revenues within a 27-32% range (equals EUR 120 million to EUR 125 million). We expect that the Group will generate a negative adjusted EBITDA again in 2022. We expect that adjusted EBITDA will see a decline compared to 2021 resulting in an amount between EUR (25) million and EUR (35) million due to further investments into our onsite business. Luxembourg, March 28, 2022 Management Board of HomeToGo SE Dr. Patrick Andrae Wolfgang Heigl Co-Founder & CEO Co-Founder & CSO Valentin Gruber Steffen Schneider COO CFO 16 2 Consolidated Statements of Profit or Loss and Other Comprehensive Income for the Years Ended December 31 (in EUR thousands, except share and per share data) Note 2021 2020 Revenues 9 94,839 65,855 Cost of revenues 10 (4,336) (2,792) Gross profit 90,503 63,063 Product development and operations 11 (23,726) (15,275) Marketing and sales 12 (95,495) (52,235) General and administrative 13 (112,751) (13,092) Other expenses 14 (626) (735) Other income 14 11,639 1,058 Loss from operations (130,456) (17,216) Finance income 2,833 — Finance expenses (38,964) (7,906) Financial result, net 15 (36,131) (7,906) Loss before tax (166,587) (25,122) Income taxes 16 (202) 1,316 Net loss (166,789) (23,806) Total comprehensive loss (166,806) (23,806) Basic and diluted earnings (loss) per share 17 (2.09) (0.36) Weighted average ordinary shares outstanding (basic and diluted) 79,619,166 66,681,774 The accompanying notes are an integral part of these consolidated financial statements. 3 Consolidated Statements of Financial Position as of December 31 (in EUR thousands) Note 2021 2020 Assets Non-current assets Intangible assets 19 61,360 41,570 Property, plant and equipment 20 15,202 16,413 Other receivables (non-current) 21 814 1,414 Income tax receivables (non-current) 79 34 Other financial assets (non-current) 22 8,249 1,485 Other assets (non-current) 23 258 68 Total non-current assets 85,962 60,984 Current assets Trade and other receivables (current) 21 18,992 5,647 Income tax receivables (current) 79 139 Other financial assets (current) 22 101,960 549 Other assets (current) 23 5,347 1,246 Cash and cash equivalents 152,944 36,237 Total current assets 279,321 43,819 Total assets 365,284 104,803 Equity and liabilities Equity Subscribed capital 2,441 93 Capital reserves 508,963 113,280 Foreign currency translation reserve (18) — Share-based payments reserve 68,744 22,148 Retained Earnings (279,444) (112,656) Total shareholder´s equity 24 300,687 22,865 Borrowings (non-current) 25 9,371 3,557 Convertible loans (non-current) 26 — 33,132 Other financial liabilities (non-current) 28 12,954 26,139 Provisions (non-current) 27 1,182 558 Other liabilities (non-current) 29 1,117 1,105 Income tax liabilities (non-current) — 17 Deferred tax liabilities 30 3,874 2,236 Non-current liabilities 28,499 66,745 Borrowings (current) 25 3,007 2,114 Trade payables (current) 15,395 4,233 Other financial liabilities (current) 28 8,885 1,574 Provisions (current) 27 108 1,100 Other liabilities (current) 29 8,535 6,156 Income tax liabilities (current) 168 16 Current liabilities 36,098 15,193 Total liabilities 64,596 81,938 Total shareholder´s equity and liabilities 365,284 104,803 4 Consolidated Statements of Changes in Equity for the Years Ended December 31 (in EUR thousands) Note Subscribed capital Capital reserves Retained earnings Foreign currency translation reserve Share- based payments reserve Total shareholder s' equity As of Jan 1, 2020 93 113,280 (88,852) — 10,959 35,480 Net loss — — (23,806) — — (23,806) Total comprehensive loss — — (23,806) — (23,806) Share-based compensation 31 — — — — 11,189 11,189 As of Dec 31, 2020 93 113,280 (112,656) — 22,148 22,865 As of Jan 1, 2021 93 113,280 (112,656) — 22,148 22,865 Net loss — — (166,789) — — (166,789) Other comprehensive loss — — — — — — (18) (18) Total comprehensive loss — — (166,789) (18) (166,806) Conversion of convertible loans 6 18 — 146,259 — — — — — 146,277 Conversion of earn outs 6 1 — 515 — — — — (515) 1 Share capital restructuring 6 1,438 — (1,438) — — — — — — Reverse acquisition of Lakestar SPAC 6 665 — 164,616 — — — — 70,437 235,718 Share issuance for PIPE financing 6 144 — 74,856 — — — — — 75,000 Share issuance transaction costs 6 — — (1,818) — — — — — (1,818) Share-based compensation 31 81 — 12,693 — — — — (23,325) (10,551) As of Dec 31, 2021 2,441 508,963 (279,445) (18) 68,745 300,687 The accompanying notes are an integral part of these consolidated financial statements. 5 Consolidated Statements of Cash Flows for the Years Ended December 31 (in EUR thousands) Note 2021 2020 Loss before income tax (166,587) (25,122) Adjustments for: Depreciation and amortization 4,690 3,607 Non-cash listing service expense - de-SPAC Charge 31 70,437 — Non-cash employee benefits expense - share-based payments 31 31,560 11,189 Fair value (gains)/losses on non-current financial assets at fair value through profit or loss (377) — VSOP - Exercise tax settlement charge 6 (30,495) — VSOP - Cash paid to beneficiaries 6 (11,616) — Finance costs - net 15 36,466 7,906 Net exchange differences (972) (33) Change in operating assets and liabilities (Increase) / Decrease in trade and other receivables (12,496) (1,676) (Increase) / Decrease in other financial assets (4,968) (135) (Increase) / Decrease in other assets (4,135) 143 Increase / (Decrease) in trade and other payables 9,742 (1,061) Increase / (Decrease) in other financial liabilities 2,105 (229) Increase / (Decrease) in other liabilities (5,067) (6,236) Increase / (Decrease) in provisions (376) 1,182 Cash generated from operations (82,088) (10,465) Interest and other finance cost paid (-) (1,140) (680) Income taxes (paid) / received (28) (163) Net cash used in operating activities (83,256) (11,309) Payment for financial assets at fair value through profit and loss 22 (100,000) — Payment for acquisition of subsidiary, net of cash acquired 6 (16,385) (1,647) Payments for property, plant and equipment 20 (324) (1,551) Payments for intangible assets 19 (91) (100) Payments for internally generated intangible assets 19 (1,545) (1,369) Proceeds from sale of property, plant and equipment 2 18 Net cash used in investing activities (118,343) (4,649) Proceeds from borrowings and convertible loans 25/26 76,175 43,512 Proceeds from recapitalization, net of redemptions 6 171,489 — Proceeds from PIPE financing 6 75,000 — Transaction costs (1,818) — Repayments of borrowings 25 (2,787) (1,500) Principal elements of lease payments (966) (563) Net cash provided by financing activities 317,093 41,449 Net increase (decrease) in cash and cash equivalents 115,494 25,490 Cash and cash equivalents at the beginning of the period 36,237 10,972 Effects of exchange rate changes on cash and cash equivalents 1,213 (226) Cash and cash equivalents at the end of the period 152,944 36,237 The accompanying notes are an integral part of these consolidated financial statements. 6 HomeToGo SE (formerly Lakestar SPAC I SE), Luxembourg Notes to the Consolidated Financial Statements (Amounts in EUR thousands, except stated otherwise) 1 - Corporate information The HomeToGo Group (“HTG” or “Group”), comprises the parent entity HomeToGo SE ("HTG SE"), Luxembourg, Luxembourg (the “Company”), and its direct and indirect subsidiaries. The Company is registered in the commercial register of the Registre de commerce et des sociétés in Luxembourg under number B249273. The Company’s address is Rue de Bitbourg 9, 1273, Luxembourg, Luxembourg. The business activities of HTG include the operation of an international marketplace for alternative accommodations that connects millions of users searching for a place to stay with thousands of inventory suppliers across the globe, resulting in the world’s most comprehensive inventory coverage in the alternative accommodation space. At the time of the report, HTG’s portfolio comprised more than 15 million aggregated accommodation offers provided by over 31,000 online travel agencies, tour operators, property managers and other inventory suppliers (“Partners”) worldwide. HTG operates its business through localized websites and apps in 24 countries. The marketplace seamlessly integrates a vast inventory in one simple search and enables users to book accommodations from diverse Partners, either on the Partner’s external accommodation websites or directly on the HomeToGo marketplace platform. The consolidated financial statements of HTG were initially authorized for issue by the Management Board on March 28, 2022. HTG SE was originally known as Lakestar SPAC I SE (“Lakestar SPAC”) a Special Purpose Acquisition Company with the objective of acquiring a European late-stage growth company in the technology sector with the funds raised from private placements. Lakestar SPAC became listed on the Frankfurt Stock Exchange on February 22, 2021. On July 14, 2021, HomeToGo GmbH (“HTG GmbH”) and Lakestar SPAC entered into a Business Combination Agreement (“BCA”) whereby Lakestar SPAC became the legal parent company of HTG GmbH, its direct and indirect subsidiaries for a contribution and exchange of HTG GmbH shares for new Public Shares (the “Business Combination” or “Transaction”). On September 21, 2021 the Transaction was closed (the “Closing”) and Lakestar SPAC changed its name to HomeToGo SE. HTG GmbH was deemed to be both the accounting acquirer and the predecessor entity in the subsequent fillings of the combined company. Therefore, HomeToGo Group presents as comparative information, the financial information of former HomeToGo GmbH Group as of December 31, 2020. See Note 6 for further details. 2 - Basis of preparation The accompanying consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) and the interpretations issued by the International Financial Reporting Standards Interpretations Committee (“IFRIC”) as adopted by and to be applied in the European Union. The official version of the accounts is the ESEF version available at the Officially Appointed Mechanism (OAM) at the German Federal Gazette ("Bundesanzeiger") under https://www.bundesanzeiger.de. The accounting principles set out below, unless stated otherwise, have been applied consistently for all periods presented in the consolidated financial statements. 7 HTG’s financial year ends December 31. All intercompany transactions are eliminated during the preparation of the consolidated financial statements. The consolidated financial statements have been prepared on a historical cost basis, unless otherwise stated. The consolidated financial statements are presented in Euro (“EUR”), which is the functional currency of the Company and all subsidiaries of HTG. All values are rounded to the nearest thousand, except when otherwise indicated. Due to rounding, differences may arise when individual amounts or percentages are added together. The consolidated financial statements are prepared under the assumption that the Group will continue as a going concern. Management believes that HTG has adequate resources to continue operations for the foreseeable future. 3 - Scope of consolidation The consolidated financial statements include the balances and results of the Company and its wholly-owned subsidiaries. Subsidiaries are entities directly or indirectly controlled by the Company. The Company controls an entity when it is exposed to, or has the right to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which control commences until the date on which control ceases. Besides the Company, the following subsidiaries are included in the scope of consolidation as of December 31, 2021: Subsidiary Location Percentage of ownership HomeToGo GmbH Berlin, Germany 100% LS I Advisors Verwaltungs-GmbH Munich, Germany 100% LS I Advisors GmbH & Co. KG Munich, Germany 100% Casamundo GmbH Berlin, Germany 100% UAB HomeToGo Technologies Kaunas, Lithuania 100% UAB HomeToGo Technologies Vilnius Vilnius, Lithuania 100% Mertus 288. GmbH Berlin, Germany 100% HS Holiday Search GmbH Berlin, Germany 100% Feries S.r.l. Milan, Italy 100% Escapada Rural S.L. Barcelona, Spain 100% HOMETOGO INTERNATIONAL, INC. Wilmington, Delaware, USA 100% Smoobu GmbH Berlin, Germany 100% Mapify UG (haftungsbeschränkt) Kassel, Germany 100% Please refer to note 6 - Business Combinations and other acquisitions for additions to the scope of consolidation during the year 2021 and 2020. 4 - Summary of significant accounting policies a)Current versus non-current classification HTG classifies assets and liabilities by maturity. They are classified as current in the consolidated statement of financial position if they mature within one year. Deferred tax liabilities and assets are consistently presented as non-current in the consolidated statement of financial position. b)Foreign currency translation HTG’s consolidated financial statements are presented in Euro, which is the functional and presentation currency of the Company and its subsidiaries. For each entity, the Group determines the functional currency and items included in the financial statements of each entity are measured using that functional currency. Functional currency is defined as the currency of the primary economic environment in which each entity operates. 1 Any transactions denominated in foreign currencies are translated at the exchange rates prevailing on the date of transaction. Balance sheet items denominated in foreign currencies are translated at the closing rate for each reporting period, with resulting translation differences recognized within the consolidated statement of profit or loss and comprehensive income. The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the reporting currency as follows: •assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet •income and expenses for each statement of profit or loss and statement of comprehensive income are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions), and •all resulting exchange differences are recognized in other comprehensive income. On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings are recognized in other comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale. c)Profit or loss structure HTG uses a cost of revenue structure to present its revenues and expenses by function. See section 9 and the following paragraph for further explanations about the content in the different profit or loss line items. d)Revenue recognition HTG applies IFRS 15 Revenue from Contracts with customers. The standard establishes principles for reporting information to users of financial statements, about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Management applies the five-step model according to IFRS 15 when determining the timing and amount of revenue recognition. HTG operates a marketplace for alternative accommodations that connects millions of travelers searching for a perfect place to stay with thousands of inventory suppliers across the globe. HTG generates revenue through the following main revenue types: •Cost per Action (“CPA”): CPA is the largest revenue stream, whereby HTG receives a percentage-based commission for successful on- or offsite booking referrals, which facilitate a stay. Depending on the contractual terms with the respective partner, the revenue for HTG is either calculated as percentage of the commission or as percentage of the booking value (sometimes called revenue share). •Cost per Click (“CPC”) HTG receives a fixed commission based on every successful referral click. •Cost per Lead (“CPL”): HTG receives a fixed commission based on every successful referral inquiry (lead). •Subscriptions and Services are related to subscription-based revenue from partners who can use the platform for listing of their rental objects over a determined period and are generated mainly by the foreign entities in Italy and Spain. CPA transactions are commission-based revenues where the Partner compensates HTG for facilitating bookings that resulted in a stay of the traveler. HTG is acting as an agent in either scenario as described above. The Company considers its Partners, in particular online travel agencies (“OTAs”), or the rental property owners and managers to be its customers. Only the CPA contracts and the specific bookings taken together would constitute a contract under IFRS 15. Typically, these bookings are cancellable at any time. The contracts with the OTA partners stipulate that HTG only earns CPA for bookings that facilitate a stay. Furthermore, for the majority of contracts the payment claim of HTG only comes into existence once the check-in of the traveler has occurred. HTG also engages in a multitude of post-booking activities that facilitate the check-in (hence the stay of the traveler), e.g. customer support for the traveler. These activities are not distinct from each other and are not separate performance obligations. It is therefore management’s judgement to define the single performance obligation of the Group’s CPA transactions as ‘successful booking’ which facilitates a stay. Therefore, the revenues for CPA transactions are recognized at the same point in time as the check-in date of 8 the traveler when HTG’s performance obligation is satisfied. Payments received from OTA partners for bookings where check-in has not occured yet are recognized as contract liabilities. For CPC or CPL transactions, HTG receives a fixed commission based on every successful inquiry or referral click. As opposed to CPA transactions, each click or inquiry initiated by the traveler through the HTG platform with referral to the partner website is considered a distinct promised service. HTG has an enforceable payment claim based on the monthly click volume and is not subject to cancellation or similar risks. Therefore, the ‘simple referral’ through CPC meets the criteria of a performance obligation which is satisfied at a point in time i.e. with the click through the partner website. HTG recognizes the revenue for CPC at the corresponding click date. In HTG’s subscription contracts, property managers or owners pay in advance for Software as a Service ("SaaS") and online advertising services related to the listing of their properties for rent over a fixed period, which is usually one year. As the performance obligation is the SaaS or listing service and is provided to the property manager/owner over time of use (SaaS) or the life of the listing period, the subscription revenues are recognized on a straight-line basis over the time of use (SaaS) or listing period respectively. Amounts received as prepayment are recognized as contract liabilities. Variable consideration might occur in the form of performance-based bonuses with respect to revenue based on bonus agreements that can be agreed for CPL and CPA transactions. HTG includes variable consideration estimated in the transaction price only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. e)Intangible assets and goodwill Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any. The useful life of intangible assets is assessed as either finite or indefinite. Refer to Note 19 - Intangible assets and goodwill for further details regarding the carrying amount of HTG’s intangible asset balances and to Note 6 - Business Combinations and other acquisitions with respect to information on goodwill and intangible assets resulting from business combinations. Intangible assets with a finite useful life Intangible assets with a finite useful life consist of licenses, trademarks and domains, customer relationships, order backlog and internally generated software. In accordance with IAS 38, development costs that are directly attributable to the design, coding and testing of identifiable software modules controlled by the Group are recognized as intangible assets where the following criteria are met: 1) It is technically feasible to complete the software so that it will be available for use, 2) management intends to complete the software and use or sell it, 3) there is an ability to use or sell the software, 4) it can be demonstrated how the software will generate probable future economic benefits, 5) adequate technical, financial and other resources to complete the development and to use or sell the software are available, 6) and the expenditure attributable to the software during its development can be reliably measured. Directly attributable costs that are capitalized as part of the software include employee costs and other directly attributable costs. Software maintenance costs are recognized as an expense incurred. Intangible assets with a finite life are amortized over their estimated useful life on a straight-line basis and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method of intangible assets with a finite useful life are reviewed at least annually, with any changes treated as changes in accounting estimates. Changes in the expected useful life or the expected pattern of consumption of the assets’ future economic benefits are considered when assessing the amortization method and useful life of the asset. 9 The estimated useful lives are as follows: Asset type Estimated useful life Software and licenses 3 to 5 years Trademarks 3 to 15 years Customer relationship 10 years Order backlog 1 year Internally generated software 3 to 7 years Goodwill indefinite Goodwill HTG’s goodwill originated from the acquisitions of Feries, Casamundo, Escapada Rural and Smoobu in 2018, 2019 and 2021 and represents the difference between the purchase price and the net identifiable assets acquired at fair value. Refer to Note 6 for further details. Goodwill is not amortized but reviewed for impairment at least annually. Refer to accounting policy on business combination and goodwill in section q). f)Property, plant and equipment Property, plant and equipment is stated at historical cost, net of accumulated depreciation and accumulated impairment losses, if any. Historical cost includes any expenditures that are directly attributable to the acquisition of the asset, including costs incurred to prepare the asset for its intended use. Property, plant and equipment is depreciated on a straight-line basis over each asset’s expected useful life. Depreciation methods, useful lives and residual values are reviewed at least annually and adjusted prospectively, if appropriate. HTG applies the following useful lives when estimating depreciation of property and equipment: Asset type Estimated useful life Leasehold improvements 2 to 15 years Other equipment and office equipment 2 to 13 years Leasehold improvements are amortized over the shorter of the underlying lease or the expected useful life of the asset. All repair and maintenance costs are expensed when incurred. HTG assesses property, plant and equipment for impairment whenever there is an indication of potential impairment. g)Leases The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at inception. The arrangement is, or contains, a lease if fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement. HTG assesses at the inception of the contract whether the contract is or contains a lease. HTG’s leases consist of real estate, car leasing and distinct server leases. Lease terms are negotiated on an individual basis and may contain a range of different terms and conditions. Lease contracts may be negotiated for fixed period or include extension options. To determine the lease terms, all facts and circumstances which offer economic incentives to exercise extension options are included. If it is reasonably certain that a lease term will be extended, the related extension option is included. The lease terms include fixed payments as well as variable payments that depend on an index or rate. 10 Management of HTG reviews the contractual and current market conditions individually when determining whether an extension option is reasonably certain to be exercised. The lease liability is measured at the date of commencement of the lease as the present value of the expected lease payments. To determine the present value, HTG discounts the remaining lease payments with the incremental borrowing rate of the lessee. The incremental borrowing rate is the interest rate that HTG would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset as the underlying lease agreement in a similar economic environment. Right-of-use assets are measured at cost at the date of commencement of the lease. The cost is comprised of the initial lease liability measurement and any lease payments made before the commencement date, less any lease incentives received and estimated cost of dismantling and removing the underlying asset incurred by the lessee. Right-of-use assets are presented in the balance sheet as part of property, plant and equipment. After the commencement date, HTG measures right-of-use assets at cost less accumulated depreciation and any accumulated impairment losses. For subsequent measurement, the carrying amount of the lease liability is increased to reflect the interest on the lease liability and reduced to reflect the lease payments made. The finance expenses associated with the lease term are recognized in the consolidated statement of profit or loss and other comprehensive income over the lease term. No impairment losses have been identified on HTG’s right-of-use assets in 2021 and 2020. HTG elected to apply an exemption for low value leases and short-term leases in accordance with IFRS 16. Low value leases are leases with contract amounts below EUR 5 thousand. Short-term leases relate to lease agreements with a lease term of less than 12 months. Lease payments associated with low value leases and short-term leases are expensed on a straight-line basis over the lease term. Accordingly, no right-of-use assets or lease liabilities are recognized for low value and short-term leases. h)Impairment of non-financial assets HTG assesses whether an asset may be impaired at each reporting date. If any indication of impairment exists, or when annual impairment testing for such an asset is required, HTG estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less costs of disposal or its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. HTG does not use the fair value less costs of disposal method when assessing the recoverable amount of its non-financial assets. HTG bases its impairment calculation on detailed budgets and forecasted cash flows. Impairment losses are recognized in the consolidated statement of profit or loss and other comprehensive income in expense categories consistent with the function of the impaired asset. For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognized impairment losses no longer exist or has decreased. If such indication exists, HTG estimates the asset’s or CGU’s recoverable amount. Financial instruments - Initial recognition and subsequent events A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets Initial recognition and measurement Financial assets are classified, at initial recognition, as subsequently measured at amortized cost, fair value through other comprehensive income (OCI), and fair value through profit or loss. 11 The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and HTG’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Group has applied the practical expedient, HTG initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain a significant financing component or for which HTG has applied the practical expedient are measured at the transaction price. In order for a financial asset to be classified and measured at amortized cost or fair value through OCI, it needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. Financial assets with cash flows that are not SPPI are classified and measured at fair value through profit or loss, irrespective of the business model. HTG’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Financial assets classified and measured at amortized cost are held within a business model with the objective to hold financial assets in order to collect contractual cash flows while financial assets classified and measured at fair value through OCI are held within a business model with the objective of both holding to collect contractual cash flows and selling. Subsequent measurement For purposes of subsequent measurement, financial assets are classified in four categories: •Financial assets at amortized cost (debt instruments) •Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments) •Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments) •Financial assets at fair value through profit or loss (equity instruments, money market funds). Financial assets at amortized cost (debt instruments) Financial assets at amortized cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired. In the case of a financial asset not at fair value through profit or loss (FVTPL), financial assets are measured at amortized cost and include trade and other receivables and other financial assets. Financial assets at fair value through profit or loss (equity instruments) The group subsequently measures all equity investments at fair value. Changes in the fair value of financial assets at FVTPL, in particular to investments in money market funds, are recognized in profit or loss in the period in which it arises. Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognized (i.e., removed from HTG’s consolidated statement of financial position) when: •The rights to receive cash flows from the asset have expired Or •HTG has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) HTG has transferred substantially all the risks and rewards of the asset, or (b) HTG has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. When HTG has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, HTG continues to recognize the transferred asset to the extent of its continuing involvement. In that case, HTG also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that HTG has retained. 12 Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that HTG could be required to repay. Impairment HTG recognizes an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss, if the exposure is material. For trade receivables, HTG applies a simplified approach in calculating ECLs. Therefore, HTG does not track changes in credit risk, but instead recognizes a loss allowance based on lifetime ECLs at each reporting date if the exposure is material. HTG has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The Group considers a financial asset in default when contractual payments are 180 days past due. However, in certain cases, HTG may also consider a financial asset to be in default when internal or external information indicates that HTG is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by HTG. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. Financial liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss. All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and other payables, net of directly attributable transaction costs. HTG’s financial liabilities include trade and other payables, as well as loans and borrowings including bank overdrafts. Subsequent measurement For purposes of subsequent measurement, financial liabilities are classified in two categories: •Financial liabilities at fair value through profit or loss •Financial liabilities at amortized cost Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Gains or losses on liabilities held for trading are recognized in the statement of profit or loss. Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at the initial date of recognition, and only if the criteria in IFRS 9 are satisfied. The Group has not designated any financial liability as at fair value through profit or loss. Financial liabilities at amortized cost This is the most relevant category to HTG. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit or loss. Derecognition A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as 13 the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit or loss. Offsetting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial position if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously. Fair value measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date in the principal or, in its absence, the most advantageous market to which HTG has access at that date. The fair value of a liability reflects its non- performance risk. A number of HTG’s accounting policies and disclosures require the measurement of fair value for both financial liabilities. HTG measures the fair value of an instrument using the quoted price in an active market for that instrument, if such price is available. A market is regarded as ‘‘active’’ if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. If there is no quoted price in an active market, then HTG uses valuation techniques that maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The chosen valuation technique incorporates all factors that market participants would take into account in pricing a transaction. In connection with management judgement about the fair value measurement, the Group involves an independent external valuation expert, who uses appropriate valuation techniques, and determines the fair value of assets and liabilities. Based on the input parameters used for valuation the fair values have to be assigned to one of the following levels of the fair value hierarchy: •Level 1: Quoted (unadjusted) market prices in active markets for identical assets and liabilities, •Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices), and •Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs). i)Convertible loans and embedded derivatives Convertible loans are subject to split accounting. The loan is initially measured at their fair value and subsequently at amortized cost using the effective interest rate method, or at the reporting date fair value with the change being reflected through profit or loss. The fair value of the embedded derivatives in HTG’s convertible loans, if separable, is deducted from the issuance proceeds of the loan and treated as a financial liability at initial recognition. The difference between the fair value of the entire instrument and the fair value of the embedded derivative is the fair value of the host contract of the loan (without conversion right). Transaction costs are deducted from the fair value of the host contract. The host contract of the loan is subsequently measured at amortized cost until extinguished on conversion or maturity of the loan. The embedded derivative is recognized as a derivative financial liability and subsequently measured at fair value through profit or loss. j)Provisions HTG recognizes provisions when it has a present obligation, legal or constructive, as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the present value of management´s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The increase in provision due to the passage of time and unwinding of the discount rate is recognized as finance expenses. 14 k)Income taxes Current income taxes Current income tax is the expected tax payable or receivable based on the taxable income or loss for the period and the tax laws that have been enacted or substantively enacted as of the reporting date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate based on amounts expected to be paid to the tax authorities. In case of uncertainties related to income taxes, they are accounted for in accordance with IFRIC 23 and IAS 12 based on the best estimate of those uncertainties. HTG establishes tax liabilities based on expected tax payments. Liabilities for trade taxes, corporate taxes and similar taxes on income are determined based on the taxable income of the consolidated entities less any prepayments made. Calculation of tax liabilities is based on the recent tax rates applicable in the tax jurisdiction of HTG. Deferred taxes Deferred taxes are recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable income and are accounted for using the balance sheet-liability method. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable income will be available against which deductible temporary differences can be utilized. However, deferred tax liabilities are not recognized if the temporary difference arises from goodwill. Furthermore, deferred tax assets and deferred tax liabilities are not recognized if the temporary difference arises from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither taxable income, nor the accounting profit. Current and deferred tax is charged or credited in the consolidated statement of profit or loss and other comprehensive income, except when it relates to items charged or credited directly to equity, in which case the current or deferred tax is also recognized directly in equity. Deferred tax assets and liabilities are calculated using tax rates expected to be in place in the period of realization of the associated asset or liability, based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period in the respective jurisdiction. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow all or part of the asset to be recovered. l)Earnings (Loss) per share HTG Group presents earnings (loss) per share data for its ordinary shares. Basic earnings (loss) per share is calculated by dividing the net income of the period by the weighted average number of ordinary shares outstanding during the period. HTG Group only issued ordinary shares according to IAS 33, all of which are outstanding, because all share classes are subject to the same dividend entitlement with regard to the earnings for the period. The potential ordinary shares were not taken into account, because the effect on loss per share would have been antidilutive. The weighted average number of shares is calculated from the number of shares in circulation at the beginning of the period adjusted by the number of shares issued during the period and multiplied by a time-weighting factor. The time-weighting factor reflects the ratio of the number of days on which shares were issued and the total number of days of the period. m)Segment reporting An operating segment is a component of HTG that engages in business activities from which it may earn revenues and incur expenses and for which discrete financial information is available and used by the Chief Operating Decision Maker (“CODM”) to make decisions around resource allocation and review operating results of HTG. HTG identified the CEO of the Company as the CODM and operates under only one operating segment and therefore the consolidated financial information represents the segment reporting. 15 n)Share-based compensation The Group granted remuneration in the form of share-based payments, whereby management and employees render services as consideration for equity instruments of the Group (equity-settled transactions). The measurement of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model in accordance with IFRS 2. Costs are recognized within profit or loss together with a corresponding increase in equity (share-based payment reserves), over the period in which the service and, where applicable, the performance conditions are fulfilled (the vesting period). The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity instruments that will ultimately vest. The expense or credit in the statement of profit or loss for a period represents the movement in cumulative expense recognized as at the beginning and end of that period. Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of HTG’s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead to an immediate expensing of an award unless there are also service and/or performance conditions. No expense is recognized for awards that do not ultimately vest because non-market performance and/or service conditions have not been met. Where awards include a market or non-vesting condition, the transactions are treated as vested irrespective of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied. When the terms of an equity- settled award are modified, the minimum expense recognized is the grant date fair value of the unmodified award, provided the original vesting terms of the award are met. An additional expense, measured as at the date of modification, is recognized for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee. Where an award is cancelled by the entity or by the counterparty, any remaining element of the grant date fair value of the award is credited immediately through profit or loss. The Group sometimes engages in share-based payment transactions to acquire goods or services from parties other than employees. The goods or services received in exchange for shares should be measured at the fair value of those goods or services. It is presumed that the fair value of goods or services can be measured reliably in the case of transactions with parties other than employees. If this presumption is rebutted, the fair value is measured indirectly by reference to the fair value of the equity instruments granted as consideration. Employee services or unidentifiable goods or services are measured indirectly at the date on which the equity instruments are granted. The fair value is not subsequently re-measured after the grant date. o)Government grants Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. The Group has chosen to present grants related to an expense item as other operating income in the statement of profit or loss and other comprehensive income. p)Business combinations and goodwill Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, which is measured at acquisition date fair value. Acquisition- related costs are expensed as incurred and included in General and administrative expenses. The Group determines if a transaction is to be accounted for as a business combination, using the concentration test and by determining that it has acquired a business when the acquired set of activities and assets include an input and a substantive process that together significantly contribute to the ability to create outputs. The acquired process is considered substantive if it is critical to the ability to continue producing outputs, and the inputs acquired include an organized workforce with the necessary skills, knowledge, or experience to perform that process or it significantly contributes to the ability to continue producing outputs and is considered unique or scarce or cannot be replaced without significant cost, effort, or delay in the ability to continue producing outputs. 16 Any contingent consideration to be transferred by the acquirer will be recognized at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of IFRS 9 Financial Instruments, is measured at fair value with the changes in fair value recognized in the statement of profit or loss in accordance with IFRS 9. Goodwill is initially measured at cost (being the excess of the aggregate of the consideration transferred and any previous interest held over the net identifiable assets acquired and liabilities assumed). If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Group re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognized at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognized in profit or loss. After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to the group of cash-generating units. The allocation is made to those cash-generating units or groups of cash- generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, being the operating segments. HTG comprises one segment with four CGUs. HTG management identifies the acquired businesses HTG, Feries, Escapada Rural and Smoobu as separate CGUs for the purpose of testing assets, other than goodwill, for impairment. Casamundo became part of the existing HTG CGU. Goodwill is tested for impairment on the basis of the three combined CGUs since this is the lowest level at which management captures information for internal management reporting purposes about the benefits of goodwill. Impairment losses relating to goodwill cannot be reversed in future periods. Where goodwill has been allocated to a cash-generating unit or group of cash-generating units and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash- generating units retained. 5 - New and revised standards a)New and revised standards and interpretations applied for the first time HTG has applied all IFRS Standards applicable as of December 31, 2021 to the extent these have an impact on the consolidated financial statements. b)New and revised standards issued, but not yet effective At the date of authorization of these financial statements, HTG has not applied the following new and revised IFRS standards that have been issued, but are not yet effective: 17 New or revised standards – endorsement completed Effective date IFRS 3 (A) Business Combinations January 1, 2022 IAS 16 (A) Property, Plant and Equipment January 1, 2022 IAS 37 (A) Provisions, Contingent Liabilities and Contingent Assets January 1, 2022 Annual Improvements 2018-2020 January 1, 2022 IFRS 17 Insurance Contracts January 1, 2023 (A) Amendment New or revised standards – endorsement outstanding Effective date IAS 1 (A) Presentation of Financial Statements: Classification of Liabilities as Current or Non- current January 1, 2023 IAS 1 (A) Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting policies January 1, 2023 IAS 8 (A) Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates January 1, 2023 IAS 12 (A) Income Taxes: Deferred Tax related to Assets and Liabilities arising from a Single Transaction January 1, 2023 (A) Amendment From the standards listed above the only amendments expected to have an impact on the reported assets and liabilities and net income of HTG are the one listed below. The IAS 12 (A) could have an impact on the recognition of deferred tax liabilities and assets from rights of use assets and lease liabilities in the future. So far, the exemption for the initial recognition of a deferred tax resulting from the recognition of a rights of use asset and lease liability according to IAS 12.15 has been availed, which will not be possible anymore. IFRS 16 (A) for COVID-19-related rent concessions could have an impact in the future since HTG Group holds several office leases which might be subject to future concessions. The given concessions would be treated as variable payments and deducted from expenses and lease liability. The impact on the consolidated financial statements from the amendments to IAS 1 is not considered to be material. 6 - Business Combinations and other acquisitions Smoobu GmbH On March 1, 2021, HS Holiday Search GmbH, a wholly-owned subsidiary of HTG, acquired 100% of the shares of Smoobu GmbH (“Smoobu”) for EUR 18.5 million in cash. The purchase price of EUR 18.5 million consists of a fixed price in the amount of EUR 19.0 million in cash less working capital adjustments of EUR 0.5 million. Of the purchase price, EUR 13.5 million were paid by the closing date and deferred consideration of EUR 5.0 million is not due until March 2022 and bears no interest. Smoobu is a provider of all-in-one vacation rental management software. It was acquired as part of the Software as a Service (“SaaS”) strategy to enhance the whole supply-side with technology solutions. In addition, the subscription model contributes to the group with a positive EBITDA. 18 The final allocation of the consideration to assets and liabilities assumed as of March 1, 2021 as part of the business combination is shown in the following table: (in EUR thousands) Fair Value Cash 299 Intangible assets: trademarks 1,849 Intangible assets: customer relationships 2,328 Intangible assets: software 2,428 Trade receivables 135 Other assets 163 Net deferred tax liability (1,643) Other liabilities (1,689) Net identifiable assets acquired 3,870 Add: goodwill 14,664 Net assets acquired 18,534 A total deferred tax liability of EUR 1.6 million was recognized based on the local tax rate of 30.2% and net of deferred tax assets for tax losses carried forward of EUR 352 thousand, which are not yet expired due to the transaction. No additional liabilities were identified. The goodwill recognized as part of the business combination relates to platform synergy effects and the entity’s market position within the subscription business. It will not be deductible for tax purposes. The fair value of acquired trade receivables is EUR 135 thousand and equals the gross contractual amount for trade receivables due less loss allowance. Acquisition-related costs of EUR 269 thousand are included in General and administrative expenses in the consolidated statement of or loss and other comprehensive loss. The acquired business contributed revenues of EUR 3.1 million and net loss of EUR 0.8 million to HTG for the period from March 1, 2021 to December 31, 2021. If the acquisition had occurred on January 1, 2021, consolidated pro-forma revenue and net loss for the Group for the financial year 2021 would have been EUR 95.3 million and EUR 166.6 million respectively. These amounts have been calculated using the subsidiary’s results and adjusting them for: •differences in the accounting policies between the group and the subsidiary, and •the additional depreciation and amortization that would have been charged assuming the fair value adjustments to intangible assets had applied from January 1, 2021, together with the consequential tax effects. The composition of the consideration and the impact on the Statement of Cash Flows can be derived from the following table: (in EUR thousands) March 1, 2021 Cash paid 13,534 Deferred consideration 5,000 Total purchase consideration 18,534 Cash and cash equivalents acquired 299 As a result of the above transaction, the Group’s goodwill increased by EUR 14.6 million from EUR 25.7 million at December 31, 2020 to EUR 40.3 million at December 31, 2021. Mapify UG (haftungsbeschränkt) Mapify UG (haftungsbeschränkt) (“Mapify”) was active in operating a community-backed travel website and was in the process of winding down. On May 31, 2021, HTG agreed to issue to the sellers 63 virtual shares from the Company's Virtual option plans at a strike price of EUR 3,783. The virtual shares are granted and fully vested immediately and represent the only consideration for Mapify. No employees were taken over. Furthermore, no established processes were continued. The transaction does not qualify as a business combination. IFRS 3 is therefore not applicable and the cost of an intangible asset or services acquired for 19 shares is measured in accordance with IFRS 2 and classified as equity settled. The identified service is marketing and influencer content from the Mapify community. Since the business of Mapify only generated immaterial revenues, the acquired trademark has no value and thus is not recognized as an intangible asset. The grant date fair value of the 63 granted and fully vested virtual shares amount to EUR 172 thousand and is recognized under marketing and sales expenses. All 63 virtual shares were exercised as part of the Business Combination as further described below. de-SPAC transaction HomeToGo SE was originally known as Lakestar SPAC I SE (“Lakestar SPAC”), a Special Purpose Acquisition Company with the objective of acquiring a European late-stage growth company in the technology sector with the funds raised from private placements. Lakestar SPAC was listed on the Frankfurt Stock Exchange on February 22, 2021. On July 14, 2021, HomeToGo GmbH (“HTG”) and Lakestar SPAC entered into a Business Combination Agreement (“BCA”) whereby Lakestar became the legal parent company of HTG, and its direct and indirect subsidiaries, for a contribution and exchange of HTG shares for new public shares ("Class A Shares") that is hereinafter also referred to as “the Transaction”. On September 21, 2021 the Transaction was closed (the “Closing”) and Lakestar SPAC changed its name to HomeToGo SE. The Transaction has been accounted for as a capital reorganization, whereby Lakestar SPAC was treated as the acquired company and HTG as the acquirer. Operations prior to the Business Combination are those of HTG and the historical financial statements of HTG became the historical financial statements of the combined entity, upon the consummation of the Transaction. Accordingly, the consolidated statement of Profit or Loss for the year ended December 31, 2021 includes the transactions of HomeToGo SE starting from the date of the Closing of the Transaction. Pursuant to the Closing several transactions occurred: •Lakestar SPAC entered into subscription agreements with investors (the “PIPE Investors”) in a Private Investment in Public Equity transaction (the “PIPE Financing”) in the aggregate amount of EUR 75 million. In return for their investment, the PIPE Investors received a total of 7,500,000 additional Lakestar SPAC Class A Shares. •Under HTG’s convertible loan agreements, the HTG Lenders had granted and disbursed loans to HTG in an aggregate principal amount of EUR 104.6 million. The resulting convertible loans of EUR 108.6 million (including accrued interest) and the derivatives of EUR 37.6 million classified as a liability and bifurcated at initial recognition were converted into 18,438 HTG shares. In addition, pursuant to the Convertible Loan Agreement 2018, under certain conditions, PG HoldCo, Inc., (in this context the “Earn-Out Subscriber”) was entitled to subscribe for further 1,290 HTG shares. Following an amendment agreed between the lenders and the Earn-Out Subscriber, the HTG shares were subsequently exchanged for Lakestar SPAC Class A Shares. •HTG Virtual Stock Options Plan ("VSOP") holders accepted the HomeToGo VSOPs Amendment, provided for in the BCA, under which the Transaction qualifies as an exercise event and pursuant to which all vested and exercisable virtual options were exercised in connection with the Business Combination. The exercise was fulfilled via a cash payment equal to 50% of the VSOP claim, to cover estimated relevant tax obligations, and newly issued Class A Shares in Lakestar SPAC equal to the remaining 50% of the VSOP claim divided by a price of EUR 10.00 per share, irrespective of the actual share price of the Public Shares at the time of the delivery. Outstanding virtual options not vested and exercisable as of the Transaction closing will vest and become exercisable to the same conditions and will be settled in Class A Shares upon future exercise by the option holder. See Note 31 - Share-based payments for further information. The acquisition of Lakestar SPAC is not identified as a business combination according to IFRS 3 since Lakestar SPAC itself was a shell company with no business. Instead, the transaction is considered being similar to a reverse acquisition under IFRS 3 and falls within the scope of IFRS 2 with Lakestar SPAC providing HTG GmbH with the service of making HTG public ("listing service"). As at Closing date, the fair value of HTG GmbH’s shares and warrants that were deemed to be issued to Lakestar SPAC amounted to EUR 235.7 million, based on the initial closing price of shares and warrants of HTG SE according to the table below. As a result, Class A Warrants issued by Lakestar SPAC and not redeemable are reclassified as equity instruments under IFRS 2. In return, HTG received Lakestar SPAC’s listing service and its net assets which mainly consisted of remaining cash net of 20 redemptions and liabilities related to the warrants of EUR 165.3 million, resulting in a total non-cash listing service expense of EUR 70.4 million to General and administrative expenses: Fair Value in EUR million Class A Shares (19.8 million shares at € 8.98 per share) 177.6 Class A Warrants (9.2 million warrants at € 0.8 per warrant) 7.3 Class B2 Shares (2.3 million shares at € 8.45 per share) 19.4 Class B3 Shares (2.3 million shares at € 8.23 per share) 18.9 Class B Warrants (5.3 million warrants at € 2.34 per warrant) 12.5 HTG GmbH's shares and warrants deemed issued 235.7 Less: Lakestar SPAC's net assets 165.3 IFRS 2 non-cash listing service expense 70.4 The expense for the warrants was determined on the basis of the fair value at the date of the Transaction. The fair value was derived by applying the Black-Scholes option pricing model where the expected volatility was derived from the historical volatility of peer group companies and based on historical stock returns adjusted by individual leverage ratios. Lakestar SPAC’s net assets at Closing September 21, 2021 (proceeds of EUR 75.0 million from PIPE financing not included): Fair Value in EUR million Cash 272.1 Redemption payable (100.6) Advances from Sponsors to be repaid (2.2) Accruals and trade creditors (4.0) Net assets 165.3 As part of the public share offering a total of 10.1 million shares with an agreed price of EUR 10 were redeemed and are currently held as treasury shares. The redemption payable of EUR 100.6 million was still outstanding at Closing, but has been paid subsequently prior to December 31, 2021. After all redemptions the resulting ownership structure was as follows: Ownership in shares Equity % HomeToGo Investors 80,793,077 69 Lakestar SPAC Public Shareholders 17,437,338 15 Lakestar SPAC Founders 6,927,628 6 VSOP Holders 4,210,905 4 PIPE Investors 7,500,000 6 116.868.948 100 As part of the recapitalization HTG GmbH’s share capital was exchanged for shares in Lakestar of EUR 1,551,227, being the 80.8 million shares, shown in the table above, at a par value of EUR 0.0192. This capital reorganization was shown as an increase within share capital by EUR 1.4 million from the old share capital (par value of EUR 1) before Closing of EUR 112,951 by reducing share premium. HTG Group has decided not to adjust the share capital in the comparatives and to show the capital reorganization only in the current financial year. A total of EUR 1.8 million were capitalized within equity as transaction costs resulting from the de-SPAC transaction. SECRA GmbH and SECRA Bookings GmbH 21 On August 23, 2021 HS Holiday Search GmbH acquired shares in SECRA GmbH and in SECRA Bookings GmbH (together “SECRA”) which led to an ownership of 19% in each entity. The consideration payable for SECRA GmbH was EUR 3.0 million and for SECRA Bookings GmbH EUR 190 thousand. Thereof EUR 3.1 million have been paid and EUR 150 thousand being a holdback amount will be due the following year. Both acquisitions are accounted for under IFRS 9 as investments at fair value through profit and loss. With the signing of the sales and purchase agreement and the additional shareholders' agreement HTG also obtained the call option to acquire the remaining 81% of SECRA in two years time at its fair market value at the time of exercise. Furthermore, HTG also obtained a perpetual put option to sell all acquired shares at a price of EUR 1 back to SECRA. The sellers obtained a perpetual call option to buy back the shares held by HTG at the same conditions of previous transfers as well as the right of offer which gives the Seller the option to offer the 81% of shares to HTG. Please refer to note 22 - Other financial assets (current and non-current) for further information regarding the investment. 7 - Critical accounting judgments and key estimates and assumptions The preparation of HTG’s consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying note disclosures and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Estimates and underlying assumptions are subject to continuous review. Below is a summary of the critical measurement processes and the key assumptions used by management in applying accounting policies with regard to the future, and which could have significant effects on carrying amounts stated in the consolidated financial statements, or for which there is a risk that significant adjustments may be made to the carrying amount of assets and liabilities in subsequent years. a)Critical accounting judgements Classification of Class A and B Warrants As part of the SPAC transaction HTG took over public warrants which were issued by Lakestar SPAC prior to the Transaction that is treated as an equity-settled share-based payment arrangement under IFRS 2, rather than a financial liability under IFRS 9. Public warrants are classified under IFRS 2 as equity since they are considered part of the issuance of equity instruments to acquire Lakestar SPAC. Since the exercise period after the closing of the SPAC transaction has lapsed whereby the warrant holders were able to redeem their warrants for cash, the Group assessed that there is no potential present obligation to settle in cash. In addition, through public communications and publications warrant holders should not expect to be able to redeem the warrants in cash nor does the Group have any established history of settlement of these instruments in cash. The classification of warrants of this kind has been submitted to regulators of the IFRS Interpretations Committee ("IFRS IC") for clarification. This committee will have its first deliberations in March 2022. Depending on the outcome of the IFRS IC’s deliberations, HTG may need to change its accounting policy and retrospectively change its accounting for the de-SPAC when a final agenda decision is available. If warrants are considered to be acquired they would continue to be financial liabilities. The IFRS 2 listing service expense would not change. Internally generated intangible assets For individual software modules, management sometimes applies judgement to determine the point in time where research can be separated from development activities. In connection with management judgement about the future economic benefit of software modules, the Group uses assumptions regarding the future performance of the software modules concerned and their implications on the Group's business activities. Government Grants In 2020, HTG received governments grants recognized as income for investment in new employments. The granting of subsidies is subject to the condition that investments are made in permanent jobs and that the 22 payroll exceeds a certain amount in the grant period from August 19, 2019 to February 18, 2023. The management of HTG assumes that the conditions of reaching a certain level of personnel-related expenses are and will be met with reasonable assurance. Therefore, HTG recognized the full receivable amounting to EUR 1.9 million under the grant in 2020 from which EUR 0.5 million have been received and EUR 1.1 million recognized as other income until December 31, 2021 from which EUR 0.7 million other income relate to the fiscal year 2021. In 2021, HTG applied for a subsidy amounting to EUR 8.593 thousand as part of the Covid-19 aid by German State for a defined period in 2020 and 2021 that is fully taxable, but does not need to be repaid. The decision on the grant by the authority was received subsequent to December 31, 2021. Since the conditions for the grant were at the time of balance sheet date the application HTG, considers that there was reasonable assurance to receive the grant and recorded a receivable as of December 31, 2021. The gain from the grant is presented in other income as well. SECRA GmbH and SECRA Bookings GmbH On August 23, 2021 HS Holiday Search GmbH entered into a sale and purchase agreement for 19 % of the share capital in SECRA GmbH and SECRA Bookings. The additional shareholders' agreement provides for various consent rights as well as informational rights. The Group is also holder of a call option to acquire all outstanding shares in both companies at fair market value, that is currently not exercisable. The management of HTG concludes that neither control, joint control nor a significant influence exists until December 31, 2021. The Group is accounting for the investment under IFRS 9 in the category fair value through profit and loss. AMIVAC SAS On Oct. 27, 2021 the Group entered into a sale and purchase agreement ("SPA") for 100% of the shares in AMIVAC for EUR 4.15 million. The closing date is January 1, 2022. As all rights granted for the period between the signing of the SPA and Jan. 1, 2022 must be considered protective, the Group will only gain control over AMIVAC SAS with the transfer of the shares on Jan. 1, 2022. b)Key estimates and assumptions Incremental borrowing rate The incremental borrowing rate for lease accounting is determined based on interest rates from various external financial data adjusted to reflect the terms of the lease and the nature of the leased asset. For additional information with respect to extension options refer to Note 4. Impairment of goodwill and trademark At least annually, or when circumstances indicate a potential impairment event may have occurred, HTG assesses whether its goodwill and trademark are impaired. The CGUs which resulted from the business combinations were also tested for impairment with the COVID-19 pandemic being a triggering event. Key assumptions used in HTG’s impairment assessments of these assets include forecasted cash flows of the business, estimated discount rate, and future growth rates. Management uses internal and external data to forecast these key assumptions. This includes consideration of any impact of the Covid-19 pandemic and of any impact of the ongoing discussion about climate change. Refer to Note 19 - Intangible assets and goodwill. Litigation HTG Group has set up a provision for a litigation that could not be settled by the date the consolidated financial statements of HTG Group were authorized for issue. The provision is measured using the calculated expected value of a performed scenario analysis by weighing the possible scenarios with their probability. Due to the inherent uncertainty of a litigation the possible financial risk might be higher than the expected value. Refer to Note 26. Covid-19 pandemic 23 Existing protective measures put in place in 2020, such as social distancing, the requirement to wear face masks in public institutions, or contact restriction regimes are slowly being released across Europe. Despite the lifting of these restrictions, there is still a possibility that the pandemic can resurface, for example, in the form of new viral variants and due to the low efficiency of existing vaccinations against those variants. It can be estimated that normalcy with unlimited travel will only be attainable in the medium term. HTG will continue to adapt flexibly to any new development on short notice, as it has done since the epidemic began in 2020. As part of the Covid-19 aids by German State HTG has applied for and received a grant of EUR 8.593 thousand that does not need to be repaid. Fair value determination for share-based payment arrangements and derivative financial liabilities Share-based payment arrangements The Group has adopted an equity-settled share-based compensation plan, pursuant to which certain participants are granted virtual shares of the Company. The grants made under this plan are accounted for in accordance with the policy as stated in Note 31 - Share-based payments. The total amount to be expensed is determined by reference to the fair value of the options granted, which is subject to estimates over time. The fair value is measured at the date of grant using an Option Pricing model as further explained in Note 31 - Share-based payments. Due to the lack of quoted market prices prior to the Transaction, the Group has determined the fair value for the measurement of the equity-settled transactions at the grant date with assistance of an external appraiser, considering certain assumptions relating to the volatility of stock price, the determination of an appropriate risk-free interest rate and expected dividends. The share price input is based on the company's valuation. Embedded derivatives Embedded derivatives resulting from the split accounting of convertible loans are measured at fair value, with changes in those fair values being recognized in profit or loss. In order to value these various instruments, the Company makes assumptions and estimates concerning variables such as discount rates, probability of a qualifying event taking place and the fair value of the Company’s shares which includes assumptions in future cash flows, discount rates, expected volatility and risk-free rate. The assumptions of future outcomes, and other sources of estimation uncertainty concerning the determination of key inputs to the valuation models, are based on management’s best assessment using the knowledge available, management’s historical experiences as well as other factors that are considered to be relevant. The estimates and assumptions are reviewed on an ongoing basis. 8 - Segment and geographic information In line with the management approach, the operating segment was identified on the basis of HTG’s internal reporting and how the CODM assesses the performance of the business. On this basis, HTG identifies as a single operating and therefore the consolidated financial information represents the segment reporting. Assets are not allocated to the business segment for internal reporting purposes. In the reporting period two single customers accounted for more than 10% of HTG’s revenues: Year ended December 31, (in EUR thousands) 2021 2020 Customer 1 19,114 9,065 Customer 2 30,534 23,498 49,648 32,563 In prior year one additional customer accounted for more than 10% of the revenues. Revenues from external customers can be attributed to the entity's country of domicile in the amount of EUR 30.9 million, 2020: EUR 20.3 million and to all foreign countries in total EUR 63.9 million, 2020: EUR 45.5 million. Due to the reverse acquisition of HTG SE (formerly Lakestar SPAC) by HTG GmbH Germany is still treated as the entity's country of domicile. 24 Non-current assets other than financial instruments and deferred tax assets located in the entity's country of domicile amounting to EUR 50.5 million, 2020: EUR 24.4 million and in all foreign countries amounting to EUR 34.6 million, 2020: EUR 33.6 million. 25 9 - Revenues HTG recognizes its revenues as follows: Year ended December 31, (in EUR thousands) 2021 2020 Revenues recognized at a point in time CPA 65,650 48,695 thereof CPA onsite 31,523 14,382 CPA offsite 34,127 34,313 CPC and CPL 20,401 10,808 Other — 654 Revenues recognized over time Subscriptions 8,788 6,352 94,839 65,855 CPA onsite reflect revenues from bookings made directly on HTG platforms while CPA offsite revenues are generated on Partner's platforms. For CPA and CPC revenues, typically the payment occurs shortly after the performance obligation is satisfied. However, a few customers paid in advance leading to a certain amount of fees which are presented under contract liabilities. Subscription revenues are generally collected before the performance obligation is satisfied over time leading to a high balance of contract liabilities, which is subsequently released over the performance period. The 2021 increase in revenues is explained both by increased activity in travel following the gradual release of measures aimed at containing the spread of the coronavirus, increased brand awareness as well as additional revenues from acquisition of Smoobu. Revenues recognized in the financial years 2021 and 2020 from contract liabilities were EUR 2.9 million and EUR 11.9 million respectively, the change in contract liabilities goes back to updated invoice terms with some of our customers during prior period. Substantially all amounts recognized from contract liabilities are recognized as revenues within the subsequent year. Refer to Note 29 - Other liabilities (current and non-current) for further information on contract liabilities. No information is provided about remaining performance obligations as of December 31, 2021 and December 31, 2020 since all performance obligations are originally expected to be satisfied within one year or less, as allowed by IFRS 15.121. HTG holds trade receivables from contracts with partners as of December 31, 2021 of EUR 9.8 million, December 31, 2020 of EUR 5.2 million. These have been impaired individually by EUR 1.0 million, 2020: EUR 0.5 million. 10 - Cost of revenues Year ended December 31, (in EUR thousands) 2021 2020 Hosting and domains 3,003 2,154 Depreciation and amortization 866 285 Other 467 353 4,336 2,792 26 Hosting and domains comprise the expenses for server hosting services and the expenses for domain subscriptions. Depreciation and amortization contains the amortization of the internally generated intangible assets. 11 - Product development and operations Year ended December 31, (in EUR thousands) 2021 2020 Personnel-related expenses 9,435 6,747 Depreciation and amortization 785 721 Licence expenses 878 581 Software expenses 4,223 4,056 Share-based compensation 8,260 3,170 Other 145 — 23,726 15,275 Personnel-related expenses for product development and operations comprise expenses for the workforce for development and maintenance of the platform and system infrastructure as well as customer service. Depreciation and amortization relate to the respective assets attributed to this workforce. Other includes overhead costs directly attributable to the Product development and operations function. 12 - Marketing and sales Year ended December 31, (in EUR thousands) 2021 2020 Performance marketing 81,173 40,517 Personnel-related expenses 5,289 4,202 Depreciation and amortization 2,559 2,111 Share-based compensation 5,700 4,623 Other 774 782 95,495 52,235 Performance marketing relates to paid marketing services, search engine marketing (“SEM”), content marketing and other forms of inbound marketing as well as on- and off-site search engine optimization. Performance marketing activities are scaled to bringing demand to the Group’s booking platforms and converting website visitors to users who make bookings. The significant increase in 2021 in performance marketing expenses as spend was increased across all markets. In addition, there was stronger competition compared to prior year leading to higher bids and therefore higher expense. Besides, additional expenses incurred as HTG specifically targeted travelers to download the HTG app. This investment supported the strong growth in CPA onsite revenues. 27 13 - General and administrative Year ended December 31, (in EUR thousands) 2021 2020 Personnel-related expenses 6,803 4,613 Depreciation and amortization 480 491 Consulting expenses 13,079 1,643 License expenses 553 178 Expenses for third-party-services 1,829 1,155 Share-based compensation 88,038 3,395 Other 1,969 1,617 112,751 13,092 2021 expenses for share-based compensation contain a non-cash expense for the listing service of EUR 70.4 million incurred as part of the accounting for the Transaction, see section 6 - Business Combinations and other acquisitions for further details. The increase in personnel-related expenses is in line with the growth of the Group's number of employees, see note 18 - Personnel expenses for further details. Consulting expenses are significantly up compared to the prior year due to the number of external service providers involved during the preparation of the Transaction. The increase in expenses for third-party-services is related to the Group's cooperation with providers of temporary staff as part of foreign operations. Other have mainly increased due to the increase in valuation allowances of trade receivables. 14 - Other income and expenses Other income includes foreign exchange gains of EUR 1.6 million (2020: EUR 0.4 million) and government grant related income in 2021 of EUR 9.3 million (2020: EUR 0.4 million). EUR 8.6 million relate to income from a grant that is part of the Covid-19 aids by the German State. The increase in foreign exchange gains goes back to an increase in USD denominated bank balances. There are future conditions or other contingencies attached to the expense related grants. HTG did not benefit directly from any other forms of government assistance. Other expenses include foreign exchange losses of EUR 0.6 million (2020: EUR 0.7 million). 1 15 - Financial result, net Year ended December 31, (in EUR thousands) 2021 2020 Finance income Interest income 1 — Other 18 — Income from remeasurement to fair value 2,814 — Finance expenses Interest expenses 3,644 2,000 Expenses from remeasurement to fair value 34,672 5,471 Interest expenses on leases 517 311 Other 130 124 Financial result, net (36,131) (7,906) Income from remeasurement to fair value relates to the remeasurement of the embedded derivatives resulting from the convertible loans. Both, income and expenses from remeasurement to fair value relating to the embedded derivatives amounting to EUR 34.7 million (2020: EUR 5.5 million) and interest expenses in relation to the convertible loan in the amount of EUR 1.9 million (2020: EUR 1.0 million) are non-cash items. Refer to Note 26 - Convertible loans for a breakdown of those expenses. 16 - Income taxes During the financial year 2020, HTG’s tax rate was 30.175%, consisting of the German corporate tax rate of 15.0%, a 5.5% solidarity surcharge on the corporate tax rate and a trade tax rate of 14.35%. As a result of the de-SPAC transaction and incorporation of the HTG SE the Group became subject to taxation under the laws of Luxembourg. Therefore, the overall tax rate changed to 24.94% in 2021, consisting of corporate tax rate of 17%, a 7% solidary surcharge on the corporate tax rate and a municipal business tax rate of 6.75%. The non- recognition of deferred tax assets ("DTA") on temporary differences consist of the exercised convertible loans in the amount of EUR 9.5 million. Refer to Note 26 - Convertible loans. Year ended December 31, (in EUR thousands) 2021 2020 Current tax (207) (40) Deferred tax 5 1,356 Income tax (202) 1,316 The following table shows the reconciliation between the expected and the reported income tax expense: 27 Year ended December 31, (in EUR thousands) 2021 2020 Loss before tax (166,587) (25,122) Tax at the expected group tax rate (24.94%, 2020: 30.18%) 41,547 7,581 Tax effects of: Deviations from group tax rate 24.94% (2020: 30.18%) 7,957 40 Virtual option plan 17,498 (3,376) Listing service fee de-SPAC transaction (21,083) — Permanent differences (3) (113) Non-deductible expenses (366) (92) Non-recognition of DTA on current year tax losses (36,334) (3,612) Non-recognition of DTA on temporary differences (9,378) 939 IRE Leasing and dismantling obligation (125) (61) Other tax effects 86 10 Total income tax expense (202) 1,316 Effective total income tax rate (%) 0.12% (5.24)% 17 - Earnings (loss) per share Basic earnings per share: Year ended December 31, 2021 2020 Net income (loss) for the period (in EUR thousands) (166,789) (23,806) Weighted average number of ordinary shares issued 79,619,166 66,681,774 Total basic and diluted earnings per share attributable to the ordinary equity holders of the Company (in EUR) (2.09) (0.36) On July 14, 2021, HTG GmbH and Lakestar SPAC entered into a BCA whereby Lakestar SPAC became the legal parent company of HTG GmbH for a contribution and exchange of HTG GmbH shares for new Public Shares. On September 21, 2021 the Transaction was closed. Refer to Note 6 - Business Combinations and other acquisitions for further details. As the business combination is accounted for as a reverse acquisition, the number of shares is adjusted to reflect the capital structure of the legal parent. In accordance with IAS 33.64, the calculation of the basic and diluted earnings per share for all periods presented must be adjusted retrospectively due to these changes. The conversion ratio is calculated as the number of shares of the legal parent, 80,793,077 to the legal subsidiary, 112,951. Refer to Note 24 - Shareholder’s equity for an overview of the conversion and the different share classes. For the calculation of diluted earnings per share, the share-based payment programs were considered. In accordance with IAS 33.58, settlement in ordinary shares was assumed for contracts where the Company has the option to settle in cash or in ordinary shares. These potential ordinary shares were not taken into account, because the effect on loss per share would have been antidilutive. As a result, basic earnings per share corresponds to diluted earnings per share. Number of potential ordinary shares: 2021 2020 Convertible loan — 337,900 Share-based payment programs 33,868 21,612 33,868 359,512 As of December 31, 28 18 - Personnel expenses The average number of employees is presented below: Year ended December 31, (Number of employees) 2021 2020 female 161 129 male 211 140 Total 372 269 Employee benefits expense are composed of the items as shown in the following table: Year ended December 31, (in EUR thousands) 2021 2020 Wages and salaries 14,258 13,091 Social security expenses 4,964 2,359 thereof: Retirement benefit costs 6 17 29 19 - Intangible assets and goodwill (in EUR thousands) Goodwill Trade- marks and domains Software and licenses Internally generated software Customer relation- ships Order Backlog Intangibl e assets Cost As of January 1, 2020 25,654 7,056 448 2,931 10,105 1,249 47,444 Additions — — 100 — — 100 Additions from internal development — — — 1,369 — — 1,369 Disposals — 23 — — — — 23 As of December 31, 2020 25,654 7,033 548 4,300 10,105 1,249 48,890 Accumulated amortization and impairment As of January 1, 2020 — 912 92 2,021 990 1,249 5,264 Amortization charge of the year — 786 17 285 990 — 2,078 Disposals — 23 — — — — 23 As of December 31, 2020 — 1,675 109 2,306 1,980 1,249 7,319 Carrying amount As of January 1, 2020 25,654 6,144 357 910 9,115 — 42,179 As of December 31, 2020 25,654 5,358 439 1,994 8,125 — 41,570 Cost As of January 1, 2021 25,654 7,033 548 4,300 10,105 1,249 48,890 Additions — — 1 — — — 1 Additions from business combinations 14,664 1,849 2,475 — 2,328 — 21,317 Additions from internal development — — — 1,545 — — 1,545 As of December 31, 2021 40,318 8,882 3,024 5,845 12,433 1,249 71,752 Accumulated amortization and impairment As of January 1, 2021 — 1,675 109 2,306 1,980 1,249 7,319 Amortization charge of the year — 828 193 867 1,184 — 3,072 As of December 31, 2021 — 2,503 302 3,173 3,164 1,249 10,391 Carrying amount As of January 1, 2021 25,654 5,358 439 1,994 8,125 — 41,570 As of December 31, 2021 40,318 6,379 2,722 2,672 9,270 — 61,361 Amortization in relation to trademarks and domains and customer relationships are presented within marketing sales expenses, while order backlog and internally generated software amortization is presented within cost of revenues. Material intangible assets comprise trademarks from Casamundo of EUR 2.5 million (2020: EUR 2.1 million), Smoobu of EUR 1.7 million (2020: EUR 0.0 million), Feries of EUR 1.3 million (2020: EUR 1.4 million), Escapada of EUR 0.7 million (2020: EUR 0.7 million), as well as customer relationships from Feries of EUR 2.6 million (2020: EUR 2.9 million), Smoobu of EUR 2.1 million (2020: EUR 0.0 million), Casamundo of EUR 1.4 million (2020: EUR 1.6 million) and Escapada of EUR 3.1 million (2020: EUR 3.5 million). The intangible assets were identified as part of the business combination in the corresponding period. Both, customer relationships and 30 trademarks from all four acquisitions have a remaining amortization period of 6-9 years as of December 31, 2021. Refer to Note 6 - Business Combinations and other acquisitions for further information. The recoverable amount of the group of CGUs is determined based on the value in use. The key assumptions for determining the value in use are those regarding the cash flows, discount rates and growth rates. The values assigned to the key assumptions represent management’s assessment of future trends in the relevant industries and have been based on historical data from both external and internal sources. The future cash flows were estimated with the underlying assumption that the COVID-19 pandemic opened up an increased market potential for vacation rentals as more traveler used vacation rental for the first time to avoid hotel accommodations. These travelers saw the benefits of vacation rental and thus, there is the assumption for a sustainable positive trend in the upcoming years. In addition, the pandemic has provided an additional market potential for Working from Home (WFH) away or "workation". Travelers are enabled by their employers to extend their holidays and to work for example a week ahead of the actual holidays or a week after. Thus, travelers are staying in a holiday area for three weeks instead of two weeks. In addition, management sees travelers becoming longer term rental customers, for example staying over the winter abroad instead of for example in Germany. Before the pandemic this was not an option for the majority of employees. These effects, combined with the Group’s ambitious measures to grow the business as an OTA, are driving a more optimistic business plan post COVID-19 and therefore higher revenues and EBITDA. Moreover, the increasing awareness in respect of the ecological impact of air travels contributes to the general trend to prefer domestic or nearby vacation destinations. With its innovative platforms and an increasing number of users and website visitors, the Management Board believes that HTG is well placed with its offerings to meet that expected change in travelling behavior and therefore expects that it will be able to achieve its growth ambition. On that basis, the Group expects significant double-digit growth over the next years. The cash flow projections are based on a detailed business plan for 5 years. Due to the high growth stage of HTG, the business plan was prolonged by four further planning years (based on yearly assumptions regarding the net sales and margin development) to reflect a step-by-step declining growth of the Group until the terminal value. Management estimates discount rates as a pre-tax measure estimated based on the historical industry average weighted-average cost of capital. The WACC takes into account cost of equity and cost of debt, weighted according to the portion of debt and equity in the Group's target capital structure. The cost of equity and cost of debt are derived from the expected return an investor would require for an equity investment or debt investment with similar risk. Segment-specific risks of the travel market are incorporated by applying a beta factor. The beta factor is evaluated annually based on publicly available market data of comparable companies. Adjustments to the discount rate are made to reflect a pre-tax discount rate. The additional basis was a market risk premium and the risk-free interest rate. The growth rates are based on industry growth forecasts. Management has considered the upper end of commonly applied growth rates to be appropriate given the development stage of HTG and the planned growth for the upcoming years. Financial Year 2021 2020 Discount rate (pre-tax) 14.9% 14.8% Growth rate 2.0% 2.0% During the periods presented, no impairment was recognized. No change in a key assumption considered possible by management would cause the carrying amount to exceed the recoverable amount. Even if the free cash flows were to decrease by 70 % this would not result in any impairment. 31 20 - Property, plant and equipment (in EUR thousands) Right-of- Use-Real Estate Right-of- Use-Asset Car Leasing Leasehold improveme nts Other equipment, factory and office equipment Total property, plant and equipment Cost As of January 1, 2020 3,078 18 331 675 4,102 Additions 13,435 — 1,773 149 15,357 Disposals 1 — — 175 176 As of December 31, 2020 16,512 18 2,104 649 19,284 Accumulated depreciation and impairment As of January 1, 2020 955 14 132 350 1,450 Depreciation charge of the year 1,266 5 101 158 1,529 Disposals — — — 109 109 As of December 31, 2020 2,221 18 232 399 2,870 Carrying amount As of January 1, 2020 2,123 4 199 325 2,652 As of December 31, 2020 14,291 — 1,872 250 16,413 Cost As of January 1, 2021 16,512 18 2,104 649 19,284 Additions 19 — 54 324 396 Additions from business combinations — 27 — 10 37 Disposals (32) — — (23) (55) As of December 31, 2021 16,499 45 2,158 960 19,662 Accumulated depreciation and impairment As of January 1, 2021 2,221 18 232 399 2,870 Depreciation charge of the year 1,304 6 138 170 1,618 Disposals — — — (22) (22) As of December 31, 2021 3,525 24 370 547 4,466 Carrying amount As of January 1, 2021 14,291 — 1,872 250 16,413 As of December 31, 2021 12,974 22 1,788 412 15,197 Expenses on leases accounted for under the low value exemption amounted to EUR 8 thousand in the financial year 2021 (2020: EUR 14 thousand) and short-term lease exemption amounted to EUR 270 thousand in the financial year 2021 (2020: EUR 16 thousand). The total cash outflow for leases amounted to EUR 1,512 thousand in 2021 (2020: EUR 905 thousand). It includes the payment of the principal amounts, interest and short-term and low value leases. Leasing activity during the reporting periods presented is comprised of office buildings and cars. The most significant contract, which commenced in 2020, is the office building in Berlin, also resulting in significant dismantling obligations. 32 Extension options are assumed to be reasonably certain to be exercised for all leases and are therefore considered within the calculation of the rights-of-use assets and lease liabilities. 21 - Trade and other receivables (current and non-current) Current trade and other receivables consist of: December 31, (in EUR thousands) 2021 2020 Trade receivables 9,755 5,142 Other receivables 9,237 505 18,992 5,647 The increase in trade receivable is related to the growth in business activity and corresponds to the increase in revenues in 2021. Non-current other receivables consist of: December 31, (in EUR thousands) 2021 2020 Other receivables 814 1,414 814 1,414 Current and non-current other receivables in financial year 2021 include receivables from government grants of EUR 10.0 million (2020: EUR 1.9 million). 22 - Other financial assets (current and non-current) Other current financial assets consist of: December 31, (in EUR thousands) 2021 2020 Deposits 1,995 361 Money market fund 99,965 188 101,960 549 The current portion of other financial assets contains an investment into a short-term money market fund accounted for at fair value through profit and loss. Other non-current financial assets consist of: December 31, (in EUR thousands) 2021 2020 Deposits 1,502 1,485 Financial asset at fair value through profit or loss 3,597 — Payments in advance for business combination 3,150 — 8,249 1,485 33 Financial asset at fair value through profit or loss represents the fair value of the Company's investment as of the balance sheet date in SECRA. Payments in advance for business combination contains a payment in advance for the acquisition of a new subsidiary, refer to section 36 - Subsequent events after the reporting period for further details. 23 - Other assets (current and non-current) Other current assets consist of: December 31, (in EUR thousands) 2021 2020 Other non-financial assets 1,695 24 Other tax receivables 1,253 379 Prepaid expenses 2,399 843 5,347 1,246 Other non-financial assets have mainly increased due to a guaranteed prepayment for services related to a new server hosting agreement that do not relate to a specific point in time in the future. Prepaid expenses have increased following the closing of new IT infrastructure agreements with prepayments. Other non-current assets consist of: December 31, (in EUR thousands) 2021 2020 Other tax receivables 187 53 Prepaid expenses 65 15 Other non-financial assets 6 — 258 68 34 24 - Shareholder’s equity The different shareholder classes can be summarized as follows: HomeToGo GmbH shares (1EUR nominal value) HomeToGo SE shares (0.0192 EUR nominal value) Commo n Shares Series A Shares Series B Shares Series C Shares Series C1 Shares Series C2 Shares Series C3 Shares Series C3/Fall 2018 Series C4 Class A Shares Class B2 Shares Class B3 Shares As of January 1, 2020 36,736 15,488 13,618 10,030 645 5,160 7,837 3,709 As of December 31, 2020 36,736 15,488 13,618 10,030 645 5,160 7,837 3,709 As of January 1, 2021 36,736 15,488 13,618 10,030 645 5,160 7,837 3,709 Conversion of convertible loans 18,438 Conversion of earn outs 1,290 Capital reorganization -36,736 -15,488 -13,618 -10,030 -645 -5,160 -7,837 -4,999 -18,438 80,793,077 Shares issued in recapitalization, net of redemptions 30,051,667 2,291,667 2,291,666 Shares issuance for PIPE financing 7,500,000 Share-based compensation 4,210,905 As of December 31, 2021 0 0 0 0 0 0 0 0 0 122,555,649 2,291,667 2,291,666 Common shares and Series A through Series C3/Fall 2018 Shares are non-par value shares and have been fully paid since 2018. Holders of these shares are entitled to the same dividends rights as declared from time to time and are entitled to one vote per share at general meetings of the Company. In general, disposal of shares requires the Company’s approval. On September 21, 2021 HTG GmbH and Lakestar SPAC (now HTG SE) consummated the BCA which led to the listing on the Frankfurt Stock Exchange and a capital reorganization of the Group. See Note 6 - Business Combinations and other acquisitions for further information. Class A through to Class B3 Shares in HTG SE are non-par value shares and have been fully paid. Class A Shares are publicly traded. As part of the public share offering a total of 10.1 million Class A Shares were redeemed against capital reserves and are currently held as treasury shares by the Company. Class B1 to B3 Shares are neither redeemable nor transferable, assignable or sellable other than to the members of the Management or Supervisory Board. Holders of Class A to B3 Shares are entitled to the same dividend and liquidation rights and one vote per share at general meetings. As part of the consummation of the de-SPAC transaction all Class B1 shares were automatically converted into Class A Shares at a ratio one for one. All Class B2 Shares will automatically convert into Class A Shares at a ratio one for one, once the closing price of the Class A Shares for any ten trading days within a thirty trading day period exceeds EUR 12. Similarly, all Class B3 Shares will automatically convert into Class A Shares at a ratio one for one, once the closing price of the Class A Shares for any ten trading days within a thirty trading day period exceeds EUR 14. There is no expiry date for the conversion of Class B2 Shares or Class B3 Shares into Class A Shares Proceeds entitlement of share classes in Liquidity Event HomeToGo SE shares In the event of a liquidation of the Company the surplus resulting from the realization of the assets and the payment of liabilities shall be distributed equally amongst the shareholders. HomeToGo GmbH shares (until Closing) If proceeds obtained by the Company in a liquidity event or exit event are distributed to the shareholders or in case of a liquidation of the Company, the holders of the Series A through Series C3/Fall 2018 shares receive a dividend and liquidation preference in comparison to the common shares, whereas each share class has an individual liquidation preference. Liquidity Events are thereby a sale of 50% or more of the interest in HTG in a 35 single transaction or a series of related transactions, the transfer 50% or more of all assets of the group in a single transaction or a series of related transactions and the liquidation of the Company or HTG. The distribution of proceeds from these cases for each shareholder would be determined according to a multi-stage distribution mechanism. In each stage the respective amount to be distributed to a certain share class and its allocation among the holders of the respective shares of that class is determined by the payments made by the holders of the respective share class in the past into the share capital and the capital reserves or the purchase price paid to the holders of the respective share class. If the (remaining) proceeds to be distributed on the respective stages are not sufficient to cover the entire total investment, the remaining proceeds are distributed pro rata between the holders of the eligible share classes. The Stages are as follows: StageEligible Share Class 1Series C3/Fall 2018 2Series C, Series C1, Series C2, Series C3 3Series B, Series A 4Series C3/Fall 2018, Series C, Series C1, Series C2, Series C3, Series B, Series A, Common Shares The distribution of the proceeds to shareholders are subject to a share class individual cap. In the event of any type of distribution made with respect to shares in the Company not being a distribution of proceeds from a Liquidity Event, such distribution shall reduce the amount of proceeds distributed on Stages 1 to 4 in a subsequent Liquidity Event accordingly. In the event of an initial public offering or admission to a stock exchange, all shares should be reallocated amongst the shareholders so that the value of shares, based on the issue or first quoted price, equal the amount which would have been distributed according to the distribution mechanism as if all shares would have been sold. Capital reserves Subscribed capital and capital reserves include received capital through the issuance of shares for cash or premium in kind. See above for share issuances during the presented periods. Retained earnings Retained earnings include the accumulated losses attributable to the shareholders. Foreign currency translation reserve Exchange differences arising on translation of the foreign controlled entity are recognized in other comprehensive income, as described in note 4 b), and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net investment is disposed of. Share-based payments reserve The share-based payments reserve is dedicated for share-based payment transactions. See Note 6 - Business Combinations and other acquisitions for information on the Mapify transaction, Note 6 - Business Combinations and other acquisitions for information on the overall Business Combination and Note 31 - Share- based payments for HTG GmbH’s granted virtual options and the exercises of such options in the course of the Business Combination. The Company does not reclassify amounts for vested awards to other equity items. Issued Class A and Class B Warrants are also classified within the share-based payments reserve. 36 25 - Borrowings The following table provides an overview on the outstanding loans within the Group as of December 31, 2021: Debtor Loan Amount (in EUR thousands) Payout date Maturity Nominal interest rate Carrying amount (in EUR thousands) HomeToGo GmbH 6,000 February 2020 December 2023 4.35% 3,000 HomeToGo GmbH 10,000 February 2021 September 2025 2.12% 8,414 Feries S.r.l. 400 August 2020 August 2025 1.50% 376 Escapada Rural S.L. 500 May 2020 June 2023 2.50% 337 Escapada Rural S.L. 300 May 2020 June 2025 1.55% 252 26 - Convertible loans As of December 31, 2020, HTG GmbH had EUR 33.1 million in subordinated convertible loans outstanding. HTG GmbH issued additional subordinated convertible loans in total of EUR 66.2 million between March 12, 2021 and April 14, 2021 and all amounts were received by June 4, 2021. All loans were fully converted into HTG GmbH shares prior to the Transaction and before being exchanged for HTG SE shares. See Note 6 - Business Combinations and other acquisitions for further information. The convertible loans contained several embedded derivatives in the form of a conversion right at the end of maturity or in the context of a financing round as well as further prepayment features. The several embedded derivatives are presented as a single instrument due to their interdependency and are separated from the host contract. The final exercise price of the conversion right was EUR 7,932.46. December 31, 2021 (in EUR thousands) Financial liability Derivative financial liability Face value of loan issued before conversion (146,259) — Initial value (72,213) (31,940) Amortization effects by applying the effective interest method (38,275) — Valuation effect derivative — (2,041) Income / Expense from contractual modifications 1,862 (3,653) Conversion into equity 108,626 37,634 Carrying amount — — December 31, 2020 (in EUR thousands) Financial liability Derivative financial liability Face value of loan issued (38,437) — Initial value (31,348) (6,979) Amortization effects by applying the effective interest method (3,646) — Valuation effect derivative — (1,834) Income / Expense from contractual modifications 1,862 (3,653) Carrying amount (33,132) (12,465) 37 27 - Provisions (current and non-current) 2021 (in EUR thousands) Dismantling Other Total Beginning of financial year 483 1,175 1,658 Additions — 83 83 Utilizations — (451) (451) End of financial year 483 807 1,290 Thereof: non-current 431 751 1,182 2020 (in EUR thousands) Dismantling Other Total Beginning of financial year 112 362 474 Additions 371 866 1,237 Releases — (6) (6) Utilizations — (48) (48) End of financial year 483 1,175 1,658 Thereof: non-current 431 127 558 The provision for dismantling relates to HTGs dismantling provisions for leasehold improvements. Other provisions include an onerous contract provision of EUR 305 thousand for a lease of an office which is not being used and could not be sublet as of December 31, 2020 and December 31, 2021. As of December 31, 2021 a provision of EUR 751 thousand is recorded as other provision for a legal dispute. Since the investigations and proceedings have not yet been completed, the complexity of the individual influencing factors, the ongoing consultations with the authorities and other latent legal risks, which are factored into the estimation of the provision, are subject to significant estimations risks. In accordance with IAS 37.92, no further disclosures are made on estimates of the financial impact or on uncertainties regarding the amount or timing of amounts of provisions and contingent liabilities in connection with the legal dispute in order not to prejudice the outcome of the proceedings and the interests of the Group. 28 - Other financial liabilities (current and non-current) Other current financial liabilities consist of: December 31, (in EUR thousands) 2021 2020 Lease liabilities 1,228 1,464 Other financial liabilities 7,657 110 8,885 1,574 Other financial liabilities include a liability for the acquisition of a new subsidiary after the balance sheet date in the amount of EUR 5 million, see note 36 - Subsequent events after the reporting period for further details. EUR 2.6 million of the carrying amount of other financial liabilities as of December 31, 2021 relate to a debtor with a creditor balance. 38 Other non-current financial liabilities consist of: December 31, (in EUR thousands) 2021 2020 Lease liabilities 12,949 13,665 Derivatives — 12,465 Other 5 9 12,954 26,139 The derivatives shown in 2020 were related to the CLAs that were fully converted to equity prior to the Transaction. 29 - Other liabilities (current and non-current) Other current liabilities consist of: December 31, (in EUR thousands) 2021 2020 Personnel-related liabilities 1,652 955 Other tax liabilities 570 276 Other non-financial liabilities 2,450 2,017 Contract liabilities 3,864 2,908 8,535 6,156 Other non-current liabilities consist of: December 31, (in EUR thousands) 2021 2020 Personnel-related liabilities 322 304 Other non-financial liabilities 795 801 1,117 1,105 Other non-financial liabilities mainly relate to the deferred government grant. 37 30 - Deferred taxes The change in deferred tax liabilities, net was recognized as income tax expense (income) or through acquisition of subsidiaries during 2020 and 2021. The unrecognized deferred tax assets amount to EUR 59.8 million (2020: EUR 23.4 million) and are mainly attributable to EUR 59.8 million (2020: EUR 21.7 million) unused tax losses and EUR 0.0 million (2020: EUR 1.6 million) unrecognized temporary differences. There is no expiry date for the cumulative tax losses except for tax losses in Luxembourg which will expire after 17 years according to local tax regulations. Tax losses include deductions for the virtual share program. Since the legal situation of deductions for share based programs has not yet been finally clarified, for an amount of EUR 14 million it is uncertain whether or not the tax authorities may accept the deduction. The total amount of temporary differences associated with investments in subsidiaries, branches and associates and interests in joint ventures for which deferred tax liabilities have not been recognized amount to EUR 256 thousand (2020: EUR 149 thousand). December 31, (in EUR thousands) 2021 2020 Deferred tax liabilities, net Beginning of fiscal year (2,236) (3,592) Recognized through profit or loss 5 1,356 Recognized through acquisition of subsidiaries (1,643) — End of fiscal year (3,874) (2,236) Deferred tax assets and liabilities are recognized for the following types of temporary differences and tax loss carryforwards. December 31, 2021 2020 Deferred tax Deferred tax (in EUR thousands) Assets Liabilities Assets Liabilities Intangible assets — (5,963) — (3,962) Convertible loan — — 207 — Provisions 247 (3) 355 — Borrowings — — — (1,389) Trade payables 47 — — — Other liabilities 6 — — — Contract Liabilities — — 394 — Tax losses 1,792 — 2,158 — Total Gross 2,092 (5,966) 3,115 (5,351) thereof non-current 1,839 (5,966) 3,115 (5,351) Offsetting (2,092) 2,092 (3,115) 3,115 Total after offsetting — (3,874) — (2,236) 38 31 - Share-based payments Virtual Option Plans - General The Company has implemented several similar share-based payment programs, i.e. separate share-based payment agreements in 2015, a Virtual Option Plan in 2016, a Founder Program in 2019, a Key Management Program in 2019 and a C-Level Incentive Program. Pursuant to the Programs, current and future members of the Company as well as other beneficiaries, who participate in the Programs according to the terms and conditions, are eligible to participate in the future growth of the Company by receiving cash payments or non- cash consideration by the Company subject to certain exit related events defined thereunder. The Programs do not provide for straight equity but virtual options which relate to an increase in the Company’s enterprise value. In the case of certain exit events such as an IPO the Company has the option to settle the payment claim in shares of the Company. Since the programs are substantially comparable according to IFRS 2.45, the following disclosures are presented on aggregate for the different programs. Terms and conditions Each issued virtual option shall grant the respective beneficiary the right to economically participate from an exit event taking into account any prior payment of any Liquidation Preferences pursuant to the Shareholders’ Agreement. Therefore, upon the occurrence of an exit event the virtual options transform into a payment claim of a beneficiary against the Company for payment of a certain monetary amount in cash or granting of a non- cash consideration. The beneficiaries are not obliged to pay a fee for the granting of the virtual options but the virtual options are granted with a certain exercise price. The exercise price is specified in the individual allotment letters with the beneficiary. The following events are considered an exit event in the option terms: the sale and transfer of more than 50% of all shares of the Company (“Share Deal Exit”), the sale and transfer of more than 50% of all tangible and intangible assets (“Asset Deal Exit”) or the listing of the Company on a stock exchange (“IPO Exit”) and in some cases also the liquidation of the Company (“Liquidation”). In the case of an Asset Deal Exit or Share Deal Exit the Company is entitled to fulfill the payment claim in whole or in part by transfer of non-cash performances that the Company received as consideration in course of the exit event, in lieu of paying a cash amount. In case of an IPO Exit the Company is entitled or even obligated to fulfill the payment claim through shares in the Company in lieu of paying a cash amount. In those instances where the Company has a choice of settlement in shares, there is no stated intent or policy to settle in cash. The respective vesting schedules and leaver conditions vary and are specified individually. The vesting period for the virtual options is three and four years and the vesting shall begin on the allotment day. Some beneficiaries have a one-year cliff and after the cliff day the virtual options are vested for every completed quarter of the year of the following three years. Other granted virtual options shall vest in equal monthly installments over four years on a linear basis. Also, different accelerated vesting and non-vesting conditions are agreed individually. Some grants are subject to accelerated vesting in case of an IPO/exit event before the vesting period some are partially (e.g. 50 %) subject to accelerated vesting and some grants do not have an accelerating vesting condition and will continue to vest after the exit event. Good leaver and bad leaver events leading to expiry for some, or all of the vested options are also defined differently, whereas in case of a termination by the employee the expiry conditions range from full expiry to 33 % expiry. Some grants are furthermore subject to specific hurdle rates, or the exercise price is subject to an adjustment mechanism depending on the exit valuation. Classification and accounting Prior to the Transaction management estimated that the IPO exit is the most probable exit scenario as of all relevant valuation dates. Since the Company in that case is entitled to fulfill the payment claim through shares in the Company and the assessment of the Company’s intent, past practice and ability to settle in equity results in all programs being classified as equity settled. The fair value is determined at grant date and the share-based payments expenses are recognized over the service period. Vesting conditions are treated as graded or linear vesting or both depending on the individual terms and conditions summarized above. Market performance conditions are assessed as part of the fair value measurement at grant. 39 Fair value measurement The fair value at grant date is determined by HTG using the following two methods. First, the common share price was derived from an option pricing model using interpolation between the previous and the latest transaction or financing round as of the grant date. In 2021, where no financing rounds took place, the Company's fair value was based on a discounted cash flow valuation approach instead. Secondly, the fair value of the virtual option as of grant date per individual beneficiary was calculated by applying the Black Scholes model based on the resulting input from the option pricing model for the underlying common share prices. The fair value was measured based on the following significant parameters: a weighted average share price of EUR 6.7 thousand (2020: EUR 3.1 thousand), a volatility of 54.5% (2020: 34.8%), a weighted average of exercise price of EUR 5.0 thousand (2020: EUR 2.1 thousand), a risk-free interest rates between -1.0% and 2.0% and a dividend yield of 0.0% (all periods). The expected volatility was derived from the historical volatility of peer group companies. The expected date of the IPO, September 30, 2022 or September 30, 2024 (for grants before 2018) was taken as the relevant date for deriving the number of shares to be received by the respective beneficiary in case of accelerated vesting conditions and for calculating the remaining term. The actual exercise of the options can only take place after the expiry of the respective waiting period i.e. usually the lock up period related to the event. The weighted average term of the virtual shares outstanding is 3.6 years (2020: 3.3 years). The valuation resulted in a weighted average fair value of EUR 3,215 per virtual share (2020: EUR 1,430). Reconciliation of virtual options 2021 Number of virtual options Weighted Average of exercise prices Outstanding as of January 1 20,376 2,080 granted during the year 3,207 3,496 forfeited during the year 139 2,313 exercised during the year 15,792 5,041 Outstanding as of December 31 7,652 2,272 2020 Number of virtual options Weighted Average of exercise prices Outstanding as of January 1 16,050 1,824 granted during the year 4,386 3,003 forfeited during the year 60 1,092 Outstanding as of December 31 20,376 2,080 None of the instruments granted are currently exercisable. The total expense in relation to share-based payment awards of virtual options amounts to EUR 22.1 million (2020: EUR 11.2 million). With respect to share-based payment expenses resulting from other transactions please refer to Note 6 - Business Combinations and other acquisitions (“Mapify”). 40 C-Level Incentive Program General On July 14, 2021 the Company signed a business combination agreement (“BCA”) with the SPAC. Refer to Note 6 - Business Combinations and other acquisitions for further information on the BCA. For the C-level management of HTG SE, the new legal parent entity after closing, 8,600 VSOPs were awarded in June 2021 as part of the SPAC deal/BCA negotiations and approved by the Advisory Board in July 2021. Vesting and performance conditions The allotments are based substantially on the terms of the Founder Program in 2019. The VSOPs are subject to graded vesting over four years. The vesting start date is prior to the grant date since the VSOPs are considered as remuneration for the work performed on the preparation of the SPAC-transaction. In case of a SPAC-transaction, no accelerated vesting with respect to the 50% of the unvested virtual options applies. With respect to such remaining (i.e. unvested) virtual options that only vest after the SPAC-transaction, a payment claim is payable to the beneficiary, provided that he or she is still employed by HTG at that point in time. The due date for the first tranche of the Stay-on Payment is 360 days after SPAC-transaction for all other Stay-on Payments one month after lapse of the respective calendar year. In addition, 60% of the virtual options shall be allotted without hurdle, 20% if the closing price of the public shares of HTG SE exceeds EUR 12.00 and another 20% if the closing price of the public shares of HTG SE exceeds EUR 14.00, in each case for any 10 trading days within any 30 trading day period in XETRA trading. The vested portion of these VSOPs as of December 31, 2021 amounts to 18.75% Classification and accounting The VSOPs are accounted according to the existing Founder Program in 2019 as equity settled with the difference that accelerated vesting does not apply and the new different hurdle rates are considered by using a Monte Carlo simulation in the fair value determination. The fair value was measured based on the following significant parameters: a weighted average share price of EUR 6.5 thousand, a volatility of 45.2%, a weighted average of exercise price of EUR 3.5 thousand , a risk-free interest rate of 0.64% and a dividend yield of 0.0%. The expected volatility was derived from the historical volatility of peer group companies. The actual exercise of the options can only take place after the expiry of the respective waiting period i.e. usually the lock up period related to the event. The weighted average term of the virtual shares outstanding is 0.2 years. The valuation resulted in a weighted average fair value of EUR 3,524 per virtual share. Reconciliation of virtual options 2021 Number of virtual options Weighted Average of exercise prices Outstanding as of January 1 — — granted during the year 8,600 3,480 exercised during the year 323 3,365 Outstanding as of December 31 8,277 3,480 41 Smoobu – Virtual participation awards General As part of the acquisition of Smoobu, HTG granted new virtual participation awards to the founders and managing directors of Smoobu, which are outside the scope of the IFRS 3 purchase consideration (Note 7) because of the continued employment requirements. Unvested options are forfeited upon employment termination and, therefore, the new virtual participations are consideration for post-combination services. The beneficiaries were granted options to acquire a certain number of future shares in the Company. Through such options, the beneficiaries will participate in HTG's future growth and increase in value. The awards can be classified into two components: 'stay on options' and 'earn-out options'. Both option types are virtual share rights which carry a contractual right to payment of a certain cash amount. An option may be exercised only in respect of vested option shares and only in the context of a defined liquidity event. Liquidity Event shall mean i) a share sale with more than 50 % of the shares, ii) a liquidation, iii) an initial public offering (the “IPO”) or iv) an asset sale of more than 50 % of the assets or an equivalent profit distribution from an asset sale. HTG has the option to settle the payment claim in common shares in case of an IPO, which is the most probable scenario through the de-SPAC transaction. Vesting and performance conditions The stay on option shares and the earn-out option shares are subject to vesting conditions. All option shares vest monthly on a linear basis over two years starting from March 1,2021, i.e. until the lapse of March 1, 2023. Accelerated vesting is applied to all option shares in the case of a Liquidity Event during that period. The unvested option shares lapse if the beneficiary terminates his service agreement. In case a Beneficiary ceases to provide his services before the lapse of March 1, 2023, he will have to repay to the Company a cash amount corresponding to the accelerated VSOPs that would have been unvested at that point in time. Therefore, graded vesting is applied. Furthermore, the earn-out option shares are subject to non-market performance conditions such as non-financial KPI's and a defined positive cash flow of the entity. Classification and accounting Both option types are in scope of IFRS 2, because even the earn-out options only come into existence if the contract will not be terminated by the beneficiary before the lapse of the earn out period and are therefore linked to future service conditions of the beneficiaries. Management estimates that the IPO exit according to the contract is the most probable exit scenario. Since the Company in that case is entitled to fulfill the payment claim through shares in the Company and the assessment of the Company’s past practice and ability to settle in equity results in the award being classified as equity settled. The fair value is determined at grant date and the share-based payments expenses are recognized over the service period. Non-market performance conditions are assessed as part of the number of shares expected to vest. The fair value was measured based on the following significant parameters: a weighted average share price of EUR 6.9 thousand, a volatility of 63.9%, a weighted average of exercise price of EUR 0.0 thousand , a risk-free interest rate of -0.6% and 2.0% and a dividend yield of 0.0%. The expected volatility was derived from the historical volatility of peer group companies. The actual exercise of the options can only take place after the expiry of the respective waiting period i.e. usually the lock up period related to the event. The weighted average term of the virtual shares outstanding is 0.5 years. The valuation resulted in a weighted average fair value of EUR 6,162 per virtual share. 2021 Number of virtual options Weighted Average of exercise prices Outstanding as of January 1 — — granted during the year 1,643 — exercised during the year 514 6,844 Outstanding as of December 31 1,129 — 42 Impact of de-SPAC on Virtual Option Plans With the closing of the Transaction as described in Note 6 - Business Combinations and other acquisitions all vested and exercisable virtual options were exercised in connection with the Business Combination on September 21, 2021 since it qualifies as an exercise event. Until that date the share-based payment reserve for those vested and exercised options accumulated to EUR 25.5 million. Based on the HomeToGo VSOPs Amendment the exercise was fulfilled via 50% of the VSOP claim in equity settlement and 50% of the VSOP claim in cash settlement to cover estimated relevant tax obligations. The equity settlement led to the issuance of 4,210,905 Class A Shares in HTG SE with a nominal value of EUR 80,849 based on the agreed share price of EUR 10. 50% of the accumulated share-based payment reserve being EUR 12.8 million were reclassified within equity. Thereof EUR 80,849 were reclassified into share capital and EUR 12.7 million into capital reserves. According to IFRS 2 the portion of the cash settlement used for tax obligations, which are settled through HTG Group on behalf of the beneficiaries, is considered a modification of the equity-settled plan and accounted for as a repurchase of vested instruments. It was therefore also taken out from the share-based payment reserve. However, the actual payroll tax was lower as expected given that the actual share price used for the payroll tax calculation was lower than the agreed EUR 10, resulting in a cash payment to the beneficiaries of the remaining cash settlement amount of EUR 4.7 million. In addition, not all beneficiaries’ payroll taxes were settled through HTG Group, for example for freelancers. As a result, the full cash settlement of EUR 6.9 million was paid out to those beneficiaries. In total EUR 34.0 million were reclassified from the share-based payment reserve. Thereof EUR 30.5 million were used for payroll tax purposes. While EUR 3.5 million for this settlement were taken from the share-based payment reserve the remaining cash settlement portion of EUR 8.1 million was expensed as followed: (in EUR thousands) Product development and operations 3,517 Marketing and sales 1,292 General and administrative 3,283 Total cash settlement expense 8,092 The total expenses in relation to all existing share-based compensation are allocated as follows: (in EUR thousands) 2021 2020 Product development and operations 8,260 3,170 Marketing and sales 5,700 4,623 General and administrative 88,038 3,395 thereof: Listing service expense (Sponsor as well as public shares and warrants from de-SPAC) 70,437 — Total 101,997 11,188 The IFRS 2 reserve thus developed as follows: 2021 2020 (in EUR thousands) Change Change January 1, 2021 Brought forward 22,148 10,959 May 31, 2021 Acquisition Mapify 172 — September 16, 2021 Conversion of Earn Outs (515) — September 21, 2021 Lakestar SPAC Listing Service Fee 70,437 — September 21, 2021 VSOP Exercise equity settlement (12,774) — September 21, 2021 VSOP Exercise tax settlement charge (30,495) — September 21, 2021 VSOP Exercise cash settlement charge not through Profit or loss (3,524) — Financial Year 2021 / 2020 Regular VSOP charge 23,296 11,189 December 31, 2021 Year end 68,744 22,148 43 32 - Related party transactions The HTG’s related parties are comprised of a significant shareholder of HTG, the members of the Management Board and the Supervisory Board, the close members of the family of these persons and controlled entities by these persons. Entities with significant influence over the Group Until the Transaction, the largest shareholder of the Group had significant influence over the Group and constituted a related party according to IAS 24. Due to the fact that this investor is also represented on the Supervisory Board of HTG SE the investor is still assumed to have significant influence over the Group although the percentage share in the parent company significantly reduced through the Transaction. This shareholder participated in the new convertible loan in 2021 with € 3.0 million and in the convertible loan in 2020 with € 4.2 million. Key management personnel of the Group The Management Board as well as the Supervisory Board of the Group constitute the key management personnel and therefore related persons according to IAS 24 for the HTG. Expenses for compensation of the key management personnel are summarized in the table below. December 31, (in EUR thousands) 2021 2020 Short-term benefits 1,020 413 Share-based payments 15,660 1,730 16,680 2,143 Share-based payments expenses for key management personnel solely arise from the Virtual Option Plans described under section ‘Share-based payments’ above, for the terms and conditions refer to Note 31 - Share- based payments. The Group has not granted any loans, guarantees, or other commitments to or on behalf of any of the related persons. Other than the remuneration disclosed above the following transactions occurred with entities controlled by key management personnel: UAB NFQ Technologies ("NFQ"), a software company registered in the Republic of Lithuania, has been identified as a related party according to IAS 24. During the reporting period, an agreement with NFQ was intact on the provision of certain software development services, office space and other services by NFQ to entities of the HTG for cash consideration. Other services mainly include the provision of payroll, accounting and car rental services. The business transactions under the scope of the agreement occurred under market conditions. Below listed amounts resulted from related party transactions with NFQ during the reporting period: December 31, (in EUR thousands) 2021 2020 Product development and operations expenses 5,493 4,469 Other Services 172 131 Office Rent 246 204 Payables towards NFQ 4 19 44 33 - Auditor's fees The following expenses incurred for services provided by the auditors and related companies of the auditors for the HomeToGo Group: December 31, (in EUR thousands) 2021 2020 Audit fees 1,490 73 thereof: audit fees for previous fiscal year audits 838 — Other attestation services 127 — Total 1,618 73 34 - Financial instruments The table below shows the net gains and losses of financial instruments per measurement categories defined by IFRS 9: December 31, (in EUR thousands) 2021 2020 Financial assets measured at Amortized cost (AC) (1,069) (480) Financial assets and financial liabilities measured at fair value through profit or loss (FVTPL) 342 — Financial liabilities measured at Amortized cost (AC) — (2,125) Financial liabilities measured at fair value through profit or loss (FVTPL) 207 (5,471) Total interest expenses including amortization from the effective interest method on financial liabilities that are measured at amortized cost for the year was EUR 0.9 million (2020: EUR 2.0 million). The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. The table excludes fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount reasonably approximates fair value. The carrying amounts of cash and cash equivalents, trade and other receivables as well as trade payables are approximately their fair value due to their short-term maturities. For all other financial assets and liabilities, no changes have occurred that would have had a material effect on the fair value of these instruments since their initial recognition. 45 Financial instruments as of December 31, 2021 are as follows: December 31, 2021 (in EUR thousands) Carrying amount Category in accordance with IFRS 9 Fair value Fair value level Non-current assets Other receivables 814 Amortized cost Other financial assets 8,249 thereof deposits 1,502 thereof investments 3,597 FVTPL 3,597 Level 3 Current assets Trade and other receivables 18,992 Amortized cost thereof trade receivables 9,755 thereof other receivables 9,237 Cash and cash equivalents 152,944 Amortized cost Other financial assets 101,960 thereof deposits 1,995 thereof money market funds 99,965 FVTPL 99,965 Level 1 Non-current liabilities Borrowings 9,371 Amortized cost Other financial liabilities 12,954 thereof lease liabilities 12,949 N/A thereof other liabilities 5 Current liabilities Borrowings 3,007 Amortized cost Trade payables 15,395 Amortized cost Other financial liabilities 8,885 thereof lease liabilities 1,228 N/A thereof other liabilities 7,656 Amortized cost 46 Financial instruments as of December 31, 2020 are as follows: December 31, 2020 (in EUR thousands) Carrying amount Category in accordance with IFRS 9 Fair value Fair value level Non-current assets Other receivables 1,414 Amortized cost Other financial assets 1,485 Amortized cost thereof deposits 1,485 Current assets Trade and other receivables 5,647 Amortized cost thereof trade receivables 5,142 thereof other receivables 505 Cash and cash equivalents 36,237 Amortized cost Other financial assets 549 Amortized cost thereof deposits 361 thereof other financial assets 188 Non-current liabilities Convertible Loans 33,132 Amortized cost 33,295 Level 3 Borrowings 3,557 Amortized cost Other financial liabilities 26,139 thereof lease liabilities 13,665 N/A thereof other liabilities 9 thereof derivatives 12,465 FVTPL 12,465 Level 3 Current liabilities Borrowings 2,114 Amortized cost Trade payables 4,233 Amortized cost Other financial liabilities 1,574 thereof lease liabilities 1,464 N/A thereof other liabilities 110 Amortized cost The carrying amounts of the financial assets and liabilities measured at amortized cost listed above and defined by IFRS 9 as of December 31, 2021 and 2020 were as follows: December 31, (in EUR thousands) 2021 2020 Carrying amount Financial assets measured at amortized cost 179,397 45,333 Financial assets measured at fair value through profit or loss (FVTPL) 103,562 — Financial liabilities measured at amortized cost 26,555 43,155 Financial liabilities measured at fair value through profit or loss (FVTPL) — 12,465 As HTG does not meet the criteria for offsetting, no financial instruments are netted. Where quoted prices in an active market do not exist, HTG uses valuation techniques that maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The valuation technique used incorporates all factors that market participants would consider in pricing such a transaction, e.g. the fair values disclosed in the notes for the host contract of convertible loans are determined by using credit-risk specific discount factors. 47 The following paragraph shows the valuation technique used in measuring Level 3 fair values at December 31, 2021 and December 31, 2020 for financial instruments measured at fair value in the statement of financial position (derivative financial liability for conversion right and contingent consideration for Escapada) as well as the significant unobservable inputs used: •Valuation techniques: The valuation of the embedded derivative is performed by using an option price model. More specifically the valuation was performed using binomial trees for HTG’s share price and refinancing rate to come up to a fair value of the conversion right. The valuation technique for the contingent consideration resulting from the acquisition of Escapada is described under note 6. •Significant unobservable inputs: The option price model for the embedded derivative uses different inputs. The most significant unobservable input is the refinancing rate of HTG. Further inputs for the valuation model are the Company value and the volatility of equity. Both inputs have a lower impact on the fair value of the entire embedded derivative. The unobservable inputs for the contingent consideration resulting from the acquisition of Escapada are described under note 6. The following tables show a reconciliation for Level 3 fair values: (in EUR thousands) Embedded Derivative Contingent Consideration Opening balance Jan 1, 2020 (315) (1,647) Issuance of convertible loans and modification of existing contracts (6,679) — Settlement — 1,647 Losses recognized in finance costs (5,471) — Closing balance Dec 31, 2020 (12,465) — Opening balance Jan 1, 2021 (12,465) — Issuance of convertible loans and modification of existing contracts (24,961) — Losses recognized in finance costs (2,644) — Gains recognized in finance income 2,436 — Conversion into equity 37,634 — Closing balance Dec 31, 2021 — — There were no transfers between the different levels of the fair value hierarchy during the periods presented. HTG’s policy is to recognize transfers into and transfers out of fair value hierarchy levels as of the end of the reporting period. 35. Financial risk management HTG is exposed to the following risks from the use of financial instruments: a) Credit risk b) Liquidity risk c) Market risk, interest rate and currency risk The Company´s Management Board have the overall responsibility for the establishment and oversight of HTG’s risk management framework. HTG’s risk management policies are established to identify and analyze the risks faced by HTG and to minimize negative impact on the financial position of HTG related to those risks. Capital risk management HTG’s objective when managing capital is to safeguard HTG’s ability to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. Management monitors capital usage by overseeing the decrease and increase of cash and cash equivalents as presented in the consolidated statement of financial position. The Group is subject to a financial covenant with regard to some loans issued in 2020 for which no breach has occurred. HTG needs to achieve an equity ratio of 50% or higher. Management expects to achieve the necessary equity ratio. 48 a)Credit risk Credit risk is the risk of financial loss to HTG if a customer or counterparty to a financial instrument fails to meet its contractual obligations. Credit risk includes both the immediate default risk and the danger of a decline in the customer’s creditworthiness. HTG is exposed to credit risk on cash and cash equivalents and current other financial assets, which it monitors centrally. HTG maintains its cash deposits at financial institutions with top credit ratings. The creditworthiness of these financial institutions is constantly monitored. HTG considers that its cash and cash equivalents and current other financial assets have low credit risk based on the external credit ratings of these financial institutions. HTG is generally exposed to the credit risk that its partners are cash-strapped or in financial difficulties and thus, would not pass the agreed share of commission to HTG. Overall, the credit risk for trade and other receivables is considered low. The maximum risk exposure for all financial assets is the carrying amount. Refer to Note 4 regarding the application of the expected credit loss model. b)Liquidity risk Liquidity risk is the risk that HTG will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. HTG’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to HTG’s reputation. HTG uses regular external financing options such as bank loans, but also financing instruments such as convertible loans, to quickly raise larger amounts of fresh capital and thus always ensure a certain liquidity buffer. The following are the remaining contractual maturities of financial liabilities at the balance sheet date. Apart from lease liabilities, the amounts are gross and undiscounted and include contractual interest payments and exclude the impact of netting agreements. December 31, 2021 (in EUR thousands) <1 year 1 - 5 years > 5 years Total Carrying amount Trade and other payables 15,395 — — 15,395 15,395 Other liabilities 8,535 1,117 — 9,653 9,653 Convertible Loans — — — — — Borrowings 3,007 9,371 — 12,378 12,378 Lease liabilities 1,228 1,632 11,318 14,178 14,178 Total 28,165 12,120 11,318 51,603 51,603 December 31, 2020 (in EUR thousands) <1 year 1 - 5 years > 5 years Total Carrying amount Trade and other payables 4,233 — — 4,233 4,233 Other liabilities 110 9 — 119 119 Convertible Loans — 42,231 — 42,231 33,132 Borrowings 1,930 4,212 103 6,245 5,671 Lease liabilities 1,487 5,154 12,674 19,315 15,129 Total 7,760 51,606 12,777 72,143 58,284 49 The following table shows changes in liabilities arising from financing activities: (in EUR thousands) January 1, 2021 Cash flows Changes in fair values New leases Additions from business combinations Reclassi fication / Convers ion Modifica tions and other effects Interest December 31, 2021 Borrowings (non- current) 3,558 9,969 — — — (3,255) (1,244) 343 9,371 Convertible loans (non- current) 33,132 66,206 — — — (108,626) (25,341) 34,629 — Lease liabilities (non- current) 13,665 — — 1 10 (517) (210) — 12,949 Derivatives (non- current) 12,465 — 207 — — (37,633) 24,961 — — Borrowings (current) 2,113 (2,362) — — — 3,255 — — 3,007 Lease liabilities (current) 1,464 (966) — 18 10 517 (332) 517 1,229 66,398 — 72,848 — 207 — 19 — 19 — (146,259) — (2,166) — 35,490 — 26,555 (in EUR thousands) January 1, 2020 Cash flows Changes in fair values New leases Additions from business combinations Reclassi -fication Modifica tions and other effects Interest December 31, 2020 Borrowings (non- current) — 7,170 — — — (3,860) 246 3,558 Convertible loans (non- current) 1,697 29,663 — — — — (1,862) 3,634 33,132 Lease liabilities (non- current) 1,397 — 12,943 — (311) (364) — 13,665 Derivatives (non- current) 315 6,679 1,818 — — — 3,653 — 12,465 Borrowings (current) — (1,500) — — — 3,860 — (246) 2,113 Lease liabilities (current) 862 (563) — 491 — 311 52 311 1,464 4,271 41,449 1,818 13,434 — — 1,479 3,945 66,398 c) Market, interest rate and currency risk Market risk is the risk that changes in market prices, such as foreign exchange rates or interest rates will affect HTG’s income or the value of its financial instruments. HTG manages its market risk on a centralized basis with the objectives of managing and controlling market risk exposures within acceptable parameters. Exposure to interest rate risk normally arises from variable interest-bearing financial instruments. HTG only has fixed interest loan agreements and therefore is not exposed to an interest rate risk. HTG is not exposed to a material transactional foreign currency risk. 50 36 - Subsequent events after the reporting period AMIVAC On August 29, 2021 HS Holiday Search GmbH entered into an transfer agreement for AMIVAC SAS (“AMIVAC”) whereby the sole shareholder had to sell all shares in AMIVAC if the French workers council agreed to the transaction. With the fulfillment of the condition HS Holiday Search GmbH entered into a share purchase agreement to acquire 100% of the shares in AMIVAC for EUR 4.2 million with a holdback amount of EUR 1 million on October 27, 2021, with the agreed closing date being January 1, 2022. As part of the agreement the seller carved out all assets related to its vacation business unit and transferred those to AMIVAC until January 1, 2022. As a result, AMIVAC will hold three complementary platforms offering vacation rentals listings and an IT platform. In addition, the seller is to provide the operational support through a service agreement in order to run AMIVAC’s vacation business as usual for one year. Given that HTG has no controlling rights as of year end, AMIVAC is not consolidated yet in 2021. Apart from the holdback amount of EUR 1 million, which is shown within other financial liabilities, EUR 3.2 million have been fully paid as at year end. The EUR 4.2 million claim to shares are shown within other financial assets. Preliminary purchase price allocation: (in EUR thousands) Preliminary Fair Value Cash 150 Intangible assets: trademarks 570 Intangible assets: customer relationships 1,391 Intangible assets: software 117 Other assets 161 Net deferred tax asset 756 Other liabilities (1,263) Net identifiable assets acquired 1,881 Add: goodwill 2,269 Net assets acquired 4,150 The purchase price allocation is preliminary as the valuation of assets and liabilities assumed as part of the business combination is not complete due to the short time frame between acquisition and authorization for issue of the Group's financial statements. Furthermore, the Company is continuously looking for and possibly in negotiation in view of potential acquisitions. Virtual Stock Option Program 2022 / Restricted Stock Unit Program 2022 In 2022 a new long-term incentive (LTI) program was established, but no awards were granted to beneficiaries as of 31st December 2021. Under the Virtual Stock Option Program (VSOP 2022) and the Restricted Stock Unit Program (RSUP 2022) Virtual Stock Options (VSOs) / Restricted Stock Units (RSUs) are granted to employees, advisors of the Company and Affiliated Companies as well as members of the Management Board. The participants are able to select the allocation of their overall grant between VSOP 2022 and RSUP 2022 (from 30% to 70% RSUP 2022 and vice versa 70 % to 30% VSOP 2022). The aggregate maximum plan volume of the RSUP 2022 and VSOP 2022 shall be limited to the value of 1,225,556 Class A Shares of the Company. VSO / RSU may be granted to the participants in one or more tranches at any time until the end of the year 2025. Ukraine In February 2022, a number of countries (including the US, UK and EU) imposed sanctions against certain entities and individuals in Russia and Belarus as a result of the official recognition of the Donetsk People Republic and Luhansk People Republic by the Russian Federation. Announcements of potential additional 51 sanctions have been made following military operations initiated by Russia against Ukraine on February 24, 2022. Due to the war in Ukraine, there has been a significant increase in volatility on the securities and currency markets. It is expected that these events may affect the activities of Russian enterprises in various sectors of the economy, but also the economy of sanctioning countries and people in those countries as well. The Management Board regards these events as non-adjusting events after the reporting period. Although neither HTG's performance and going concern nor operations, at the date of this report, have been significantly impacted by the above, the Management Board continues to monitor the evolving situation and its impact on the financial position and results of the company. The indirect impact of the war in Ukraine and its implications, such as a potential change in travel behavior, cannot be quantified at this point in time. Luxembourg, March 28, 2022 Management Board of HomeToGo SE Dr. Patrick Andrae Wolfgang Heigl Co-Founder & CEO Co-Founder & CSO Valentin Gruber Steffen Schneider COO CFO 52