VT5 Acquisition Company AG

Investor Presentation • Jun 10, 2024

R&S Group Investor Presentation

June 2024

This presentation contains certain forward-looking statements. Such forward-looking statements reflect the current views of management and are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results, performance or achievements of the Group to differ materially from those expressed or implied herein. Although R&S Group is convinced that the forward-looking statements are based on reasonable assumptions, R&S Group cannot guarantee that these expectations will be realized.

Should such risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this presentation.

R&S Group is providing the information in this presentation as of this date and does not undertake any obligation to update any forward-looking statements contained in it as a result of new information, future events or otherwise.

Executive Committee

Markus Laesser Group CEO

Matthias P. Weibel Group CFO

Table of contents

1	Introduction and highlights
2	Strategy
3	Full year 2023 financial results
4	Sustainability
5	Outlook & take aways

Successful year 2023 marked by strong sales and record profitability results. Net sales of CHF 201.6 mn (adjusted) up by 40% on an organic basis. EBIT (adj.) of 37.5 mn.

High employee engagement across all locations of the Group.

Secular tailwinds for the electricity distribution sector driving multi-dimensional future growth.

Strong operational results turning into remarkable cash conversion.

Achievements delivered as promised in FY 2023 guidance.

Listing on SIX Swiss Exchange on 13 December 2023 under the symbol «RSGN». Organisation readied for »being public».

R&S has the DNA of a quality local champion with the necessary scale

Source: Management information Notes: 1. Founded in 2012, R&S was built on a company from 1919

1. Industries include photovoltaic and wind (renewables), e-mobility, and Datacenters

Introduction and highlights Our highly reliable transformer portfolio

Reliable and highly efficient electrical infrastructure products

Introduction and highlights Continued significant investment in 2023 to boost future growth

Introduction and highlights Continued significant investment in 2023 to boost future growth

Strategy

Markus Laesser | Group CEO

Strategy ¦ Market Strong secular market tailwinds for increased electricity demand

…drive accelerated transformer market growth

…combined with massive replacement

Sources: Reuters, WHO, IEA, World Economics, S&P, Consultancy analysis

electricity

Increased access to

Increase of global

Changing electricity consumption

Rise in traditional demand and the upgrading of grid infrastructure as well as the emergence of new demand through electrification

Expansion of large-scale renewables

Growth of centralised renewables creating the need for long distance transmission and a flexible grid. In this context CHF18bn from the Cohesion Policy fund is invested into renewable energy sources

Growth of distributed renewables

Including residential and commercial generation, requiring grid upgrades for bi-directional flows (supported by EU CHF40bn fund aimed to support low carbon, nascent technologies)

Aging grid infrastructure

Increasing number of replacements needed for equipment, as well as growing maintenance needs with currently 30% and by 2030 about 50% of the EU grid being over 40 years old

Increasing reliability and resiliency concerns

Cybersecurity, weather & climate changes and geopolitical challenges all require improved resiliency and reliability in the grid

Strategy ¦ Our response 13 Strategic roadmap of ongoing & future upside levers

Strategy ¦ Leadership Culture as a key driver for value creation and growth

Strategy ¦ Execution Strategic Initiatives already executed in 2023

2023

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Full year 2023 financial results

Matthias P. Weibel | Group CFO

FY 2023 financial results Key messages per 31 December 2023

FY 2023 financial results Strong growth of order intake and backlog

• Stable backlog 2024 with strong Value Added; continuously high monthly order intake; no margin erosion expected in 2024 in key markets (CH, GER, IT)
• Low pressure on prices as long as material prices remain stable; build-up of new capacities and competitors that calculate very tight might change the overall picture only in the short term
• Since 3 months avg. Book-to-bill flat > 1.1 (see graph above)
• High backlog for Oil-Distribution and Power Transformers until mid of 2025, normal backlog for Cast Resin Transformers until mid of 2024

FY 2023 financial results Key financial figures 2023 (adjusted )

	2022 reported	2077 adjusted1	2073 reported	2073 adjusted	Change in adjusted %
	MCHF	MCHF	MCHF	MCHF	in%
Order Intake	240.9	231.6	264.6	245.0	6%
Order backlog	158.9	ારી જે	185.7	185.7	22%
Net sales	155.1	144.3	216.9	201.6 -	40%
Operating result (EBIT)	7.7	9.1	28.7	37.5 3	312%
as % of net sales	5.0%	6.3%	13.2%	18.6%
Net profit	4.3	રે તે	11.6	28.9 4	391%
Earnings per share in CHF	0.15	0.20	0.40	1.00	391%
Net financial position3	4.7	7.0	6.7	6.76	-5%
Dividend per share	O	O	0.25	0.25 7
Year-end Number of full-time equivalents	712	540	616	616	14%

Three adjustments at holding level had a significant impact on the annual financial statements.

According to FER 24/22, transaction costs may not be offset against equity, but must be expensed as "Listing costs" in financial expenses.

Negative impact of 8 MCHF on net income.

Initial Business Combination (IBC) led to goodwill offset of CHF 17.7 million against equity

From a legal perspective, VT5, later renamed to RSG, took over the existing R&S group. From an accounting perspective, however, the existing R&S (i.e. R&S International Holding AG) bought VT5. For this reason, a specific amount of goodwill resulted, which was booked against equity (acc. to FER 30).

Historic goodwill of SERW to be fully amortized via P&L.

Negative impact of an additional MCHF 5.52 on EBITDA (total of MCHF 9.5 in other operating expenses).

A
B
C
D
E
F
G

adjusted EPS at 1.0 CHF

previous year 2022: «old» R&S group without acquired VT5

A Net sales

• adjusted net sales without SERW 201.6 MCHF (+40%)
• small FX impact: based on prior year avg. exchange rates net sales would have been 1.9% higher; mainly due to stronger CHF vs. EUR
• B Semi-/ finished goods decreased in 2023 as all plants, except ZREW, were able to reduce their semi/ finished goods
• C Material costs decreased continuously in 2023 and with good availability of key materials. Low materials ratio at 57% at the end of the year (previous year 68%).
• D Personnel costs in relation to sales down from previous year from 21% to 18%, but higher in absolute terms (+17.8%) due to salary inflation (especially in Poland) and increase number of employees to address business growth and strategic expansion of capacities (new plant in Poland)
• E Other operating expenses includes write-off of historic goodwill (5.52 MCHF) and the disposed net assets (4 MCHF) of SERW

Financial result listing costs

F

• According to FER 24/22, the ransaction costs for «going public» may not be offset against equity, but must be reported as expenses in «Financial Expenses»
• For 2024, the costs of «being public» will be recorded in operating expenses .
• G Tax expenses increased due to higher profit and continued consumption of tax loss carryforwards (most of the available losses were consumed in 2023) and expired tax exemptions for Tesar PL.

FY 2023 financial results Continuously increased levels of revenue and value add

Quarterly performance illustrates how operating performance and margins have continuously improved over the last two years.

-

Balance sheet and Cash flow: reduction of NWC unlocked cash

Guidance

Guidance

R&S to deliver profitable growth on a sustainable basis

2023 actual	1	2
40% (adjusted) to CHF 201.6 m	Above 12% 9-12%	Around 12%
18.6%
of net sales (adjusted)	Around 20% of net sales	Around 20% of net sales
15.3 % of net sales	Mid-teens double-digit as % of net sales	Mid-teens double-digit as % of net sales

¹ Latest guidance for 2024 (announced on 17 May 2024)

² Based on current mid-term plan (announced on 17 May 2024)

Guidance ¦ Corporate Governance Stable shareholder base

650 shareholders per end of 2023 832 shareholders per 31.05.2024

Sustainability

Matthias P. Weibel | Group CFO

Sustainability Report on non-financial matters (ESG report)

• The non-financial report is separated from the annual report and has been established in accordance with Art. 964a et seqq. of the Swiss Code of Obligations.
• We recognize the environmental footprint of our operations and seek to avoid, minimize and mitigate our adverse environmental impact, regarding greenhouse gas (GHG) emissions, the use of water, electricity, natural resources and soil pollution.
• We continue to consider ways to understand different metrics for measuring Scope 1, 2 and 3 GHG emissions and tracking our impact on decarbonization.
• We've set the target to reduce GHG emissions by 33% by 2033 versus 2023 levels, and to be climate neutral by 2050, in accordance with the Swiss Climate and Innovation Act.
• We pursue a zero-tolerance policy with regard to child labour within the Group and does not import or process an annual quantity of conflict minerals.

Implementation of sustainability initiatives across our transformer value chain

• Flagship project demonstrated low energy losses in use and low CO2 in production
• Minimising supply chain impact with bluemint® materials provided from nearby sites in Europe

Transformers produced with a demonstrable sustainable impact

…to how products are designed and perform

• Product design optimisation and use of better performing materials
• ≥80% of the final product consists of metals, of which the majority is recyclable
• The life expectancy of the product is ~20 years on average, with some products still in operation today after 35+ years

• Demonstrated results with 25% annual energy savings for products vs. the first product supplied in 19932

Cast resin transformers produced with a circular economy approach

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Sources: Thyssenkrupp, Management information

Note: 1. Based on an allocation method

1. Refers to energy savings in KWh/year for 1,500 kVA transformer; for the calculation of the saved load loss, assumes a transformer loaded to 80% of the full load for 24h/day working 365 days/year

Outlook & take aways

Markus Laesser | Group CEO

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Financial Calendar

Trading update half-year sales 24 July 2024 Half-year results 2024 11 September 2024 Capital Markets Day 31 October 2024 Annual General Meeting 2025 14 May 2025

Contacts

Investor Relations: Media:

Doris Rudischhauser Nicolas Weidmann Phone: +41 79 410 81 88 Phone: +41 79 372 29 81 Email: investors@the-rsgroup.com Email: media@the-rsgroup.com