Aquafil

Investor Presentation • Jan 30, 2023

Investor Presentation [ECNLF:OTCQX] – [ECNL:IM]

Lytham Partners Investor Select Conference January 31, 2023

Aquafil is Market Leader in Nylon

% on 9M22 REVENUES

And Market Leader Worldwide

% on 9M22 REVENUES

From Family Business To Global Sustainability Champion

20 Plants, 9 Countries on 3 Continents

Ca. 2,800 Employees

€ 529,9 Million of Revenues for 9M22

€ 73,2 Million EBITDA 9M22

43,5% ECONYL® fiber turnover

Aquafil Group

ITALY Arco (TN)

Aquafil (Headquarter)

Cares (TN) Rovereto (TN) Tessilquattro

USA Cartersville (Georgia) Aquafil USA 1

Phoenix (Arizona) Aquafil Carpet Recycling ACR#1 Aquafil Carpet Collection ACC

Anaheim (California) Aquafil Carpet Collection

Chula Vista (California) Aquafil Carpet Collection

Miramar (California) Aquafil Carpet Collection

Rutherford College (North Carolina) Aquafil O'Mara

UK

Kilbirnie Aquafil UK

SLOVENIA

Ljubljana AquafilSLO

Senožeče AquafilSLO Senožeče

Celje AquafilSLO Celje - Teharje

Ajdovščina AquafilSLO Ajdovščina

CROATIA

Oroslavje Aquafil CRO

THAILAND

Rayong Aquafil Asia Pacific

JAPAN Tokyo Aquafil Japan

CHINA

Jiaxing Aquafil Jiaxing

CHILE Santiago AquafilChile

Aquafil Brand Manifesto - Our Vision

At Aquafil, we design better to do better.

We are conscious innovators. We think as beginners and act as pioneers to provide unique products and services that leverage performance and reduce the impact on a global scale.

We are thoughtful listeners.

We step out of our comfort zone to set new standards through empathy and collaboration, inside and outside.

We are down-to-earth visionaries.

We envision the goal of a sustainable future to achieve it, driven by the responsibility to change the world one choice at a time.

To come full circle and create our story.

Leading the Circular Economy Revolution

- Source: Ellen MacArthur Foundation

Our path to circularity began in 1990, when the Group started recovering "lactamic waters" produced during the polymerisation process. Since then, we have invested time and money to "close the loop" through cutting-edge technologies. The biggest turning point was the adoption of a "Life Cycle" approach. This led to the creation of our ECONYL® Regeneration System.

Aquafil change drivers are

• Increasing volatility related to crucial raw materials both in term of availability and prices
• Production process wastes management
• Growing attention versus an "environmental" frame in the value chain and among stakeholders
• Clients sharing the same vision
• Many different regulators increasing focus to environmental laws all across Group presence countries
• First steps versus Extended Production Responsibility ("EPR")
• Civil society growing sensitiveness

Eco-Design is next crucial step, from the "raw material–product–waste" linear model to the "closing the loop" paradigm. Products build with raw materials which will become raw materials by themselves

Company Strengths

A successful Business Model. Proprietary technology with continuous R&D innovation. Manufacturing and operational excellence focused on high end segments.

Pioneer of Circularity with the ECONYL® Regeneration System, producing sustainable fibers and polymers from nylon 6 waste.

Around 43,5% of fiber turnover.

Glocal. A Global Company with local productions.

ECONYL ® Regeneration System

• ECONYL ® nylon is 100% coming from waste. No fossil oil used!
• It has the same quality and performance as standard nylon. Infinitely regenerable!
• Unique proprietary technology.
• In the past years, its growth rate has been on average more than 2.5 higher than traditional fibres .
• Global warming potential reduced up to 90% if compared with traditional oil -based raw material.

ECONYL ® : Our Source Of (Sustainable) Competitive Advantage

WASTE IN

ECONYL® nylon is made from waste otherwise destined for the landfill

NO WASTE OUT

Our Main 2025 Enviromental Targets

60% Of Revenues Generated By Fibers From ECONYL® Branded Products

35,000 Tons Of Post consumer Waste Collected Annually

Water Consumption Reduced By 30% Compared To 2018

CIRCULAR PERSPECTIVE

Innovating products to make them more and more circular, giving new life to waste materials, in an infinite cycle.

PROTECTING THE ENVIRONMENT

Producing consciously and responsibly, pursuing continuos improvement and excellence in every aspetc.

ATTENTION TO THE WELL-BEING OF PEOPLE

People who, with commitment and passion, are the foundation of the Group.

Our path to Sustainability RETHINKING PRODUCTS IN A

Since 2008, we have formalized our commitment in our ECO PLEDGE®, a set of five principles that guide and inspire all the work of the Group.

SUPPORT LOCAL COMMUNITIES

Grow in harmony with local communities, promoting a prosperous and respectful development of their territory.

SHARED RESPONSIBILITY ALONG THE SUPPLY CHAIN

Collaborate with suppliers and customers to bring about change and environmental sustainability in the entire sector.

Our Top 2021 Achievements

ESG goals

• 64% reduction in Scope 1 + Scope 2 emissions in 5 years • 100% of electricity coming from renewable resources • 25% reduction in water consumption in 5 years • 90% of waste recovered (recycling and energy recovery) • Cradle to Cradle Material Health Gold & Silver certification for our ECONYL® products

• 100% increase in the number of female executives in 2 years • 92% increase in hours of training delivered vs 2020 • 2x welfare budget vs 2020

• Approval of a new remuneration policy • Approval of a new engagement policy • Acquisition of 3 more ISO 50001 (Energy management) and 4 more SA8000 (Social Responsibility) certifications in our Slovenian facilities during 2021.

Sustainalytics considers the company's management of ESG material risk as strong. We improved our ESG ranking going from 56th to 32nd out of 176 textile companies.

After joining the Ellen McArthur Foundation in 2020, our Group joined the Plastics Recyclers Europe association.

Aquafil contributes to 12 SDGs

4 Quality Education	10 Reduced Inequalities
5 Gender Equaty	11 Sustainable Cities & Communuties
6 Clean Water and Sanitation 7 Affordable & Clean Energy	12 Responsible Consumption & Production
8 Decent Work & Economic	13 Climate Action
Growth	14 Life Below Water
9 Industry, Innovation & Infrastructure	15 Life on Land

Financial Results

9M22 – Key Message

9M22 General Results

Sharply increasing compared to 9M21

• Revenues +26,4% vs 9M21
• EBITDA +23% vs 9M21

ECONYL® Branded Products

• Revenues up by 64,5% vs 9M21
• 43,5% of revenues generated by fibers

Aquafil Chile incorporated to expand procurement capacity of raw materials for the ECONYL® process.

Benefit company Bluloop S.r.L. Incorporated to sell ECONYL® branded products directly online.

9M22 – Key Message

		Revenues			EBITDA			Net profit			NFP
	2022	2021	Δ%	2022	2021	Δ%	2022	2021	Δ%	30.09.22	31.12.21	Δ%
9M	529,9	419,3	26,4%	73,2	59,6	22,9%	26,1	14,3	83,3%	(231,5)	(179,3)	-29,1%
% on Revenues				13,8%	14,2%		4,9%	3,4%
3Q	178,9	144,6	23,7%	21,7	20,2	7,2%	8,5	5,3	58,3%
% on Revenues				12,1%	14,0%		4,7%	3,7%
	USA • Best macro area EMEA • Lower demand		•	Higher to 9M21 thanks to better sales mix also thanks to ECONYL® products increase		driven by • •	Strong increase EBIT improvement Lower financial costs		On 31th On 30th	Higher of 29,1% vs Dec21 NFP/EBITDA LTM 2,49 December 2021 2,70 September 2022

Revenues

Breakdown by Product Line

Revenues

ECONYL® regenerated nylon

Strong growth +65% vs 9M21 due to price increase and higher quantities driven by:

• BCF fiber: higher demand in contract sector
• NTF: higher demand from fashion brands

P&L – KPI

			9M			3Q
		2022	2021	Δ%	2022	2021	Δ%
Revenues		529,9	419,3	26,4%	178,9	144,6	23,7%
EBITDA	% on net Sales	73,2 13,8%	59,6 14,2%	22,9%	21,7 12,1%	20,2 14,0%	7,2%
EBIT	% on net Sales	32,4 6,1%	22,3 5,3%	45,1%	7,9 4,4%	8,3 5,7%	-5,1%
EBT	% on net Sales	33,0 6,2%	18,0 4,3%	83,6%	8,9 4,9%	7,0 4,8%	26,8%
NET RESULT	% on net Sales	26,1 4,9%	14,3 3,4%	83,3%	8,5 4,7%	5,3 3,7%	58,3%

NFP – NFP on EBITDA

• NFP on 30th September 2022 equal to 231,5 €/mil, higher of ca 13% compared to 31st December 2021
• Ratio NPF/EBITDA LTM at 2,70x

NFP

Increase of NWC mainly driven by inventory

NWC growth driven by increase of inventory value due to:

• higher unitary cost of raw material
• increase of raw material quantities

2022 Outlook

As a result of the different global political and macroeconomic contexts, it is appropriate to analyze the Group's performance separately in the different geographical areas where it operates in order to provide a more comprehensively information on its performance.

EMEA is showing the expected slowdowns in the end market across all product lines due to the heavy inflationary pressures that have impacted mainly raw materials and energy. In the United States, the excellent uptrend reported in the first nine months of the year is confirmed. In Asia and Oceania, the market is showing sound end customer demand levels thanks to the partial recovery of the residential market and an excellent performance by the Japanese market.

For the fourth quarter, we expect a less positive result than in the previous quarters of 2022 yet better than in the fourth quarter of 2021. On an annual basis, this will translate into the highest levels of absolute profitability ever achieved by the Aquafil Group.

Giulio Bonazzi Chairman and CEO

Attilio Annoni Executive Director

Stefano Lor Director

Franco Rossi Director

Simona Heidempergher

Director

Silvia Bonazzi Director

Margherita Zambon

Director

Francesco Profumo Director

Ilaria Maria Dalla Riva Director

Corporate Governance And Ownership Structure

Definition

«FIRST CHOICE REVENUES»

"First choice revenues" are revenues generated by the sale of fiber and polymers, gross of any adjustments (for example, discounts and allowances), but excluding revenues generated by "non-first choice products", revenues generated by Aquafil Engineering GmbH and "other revenues". Based on historical figures, these revenues accounted for more than 95% of the Group's consolidated revenues

EBITDA

This is an alternative performance indicator not defined under IFRS but used by company management to monitor and assess the operating performance as not impacted by the effects of differing criteria in determining taxable income, the amount and types of capital employed, in addition to the amortisation and depreciation policies. This indicator is defined by the Aquafil Group as the net result for the year adjusted by the following components: income taxes, investment income and charges, amortisation, depreciation and write-downs of tangible and intangible assets, provisions and write-downs, financial income and charges, non-recurring items.

NFP

This was calculated as per Consob Communication of July 28, 2006 and the ESMA/2013/319 Recommendations:

• A. Cash
• B. Other liquid assets
• C. Other current financial assets
• D. Liquidity (A+B+C)
• E. Current financial receivables
• F. Current bank payables
• G. Current portion of non-current debt
• H. Other current financial payables
• I. Current financial debt (F+G+H)
• J. Net current financial debt (I-D-E)
• K. Non-current bank payables
• L. Bonds issued
• M. Other non-current payables
• N. Non-current financial debt (K+L+M)
• O. Net financial debt (J+N)

Appendix Consolidate Income Statements

CONSOLIDATED INCOME STATEMENT	September	of nich	September	of nich	Third	of nich	Third	of wich
$\epsilon/000$	2022	$non-$	2021	$non-$	Quarter 2022	$non-$	Quarter 2021	$non-$
		current		current		current		current
Revenue	529.905	849	419.310	587	178.896	324	144.610	587
of which related parties	39		40		13		13
Other Revenue	8.492	126	4.525	672	6.079	12	1.840	229
Total Revenue and Other Revenue	538.397	975	423.835	1.259	184.975	336	146.450	816
Raw Material	(245.437)	(475)	(208.556)	(191)	(87.072)	(181)	(73.062)	(191)
Services	(129.905)	(1.094)	(78.104)	(1.079)	(47.948)	(356)	(28.004)	(775)
of which related parties	(342)		(303)		(112)		(91)
Personel	(96.084)	(1.157)	(83.413)	(1.413)	(31.186)	(346)	(27.609)	(831)
Other Operating Costs	(3.447)	(291)	(2.488)	(186)	(1.001)	(176)	(848)	(125)
of which related parties	(52)		(52)		(17)		(17)
Depredation and Amorti zation	(35.954)		(33.381)		(12.198)		(10.068)
Provisions&Write-downs	166		(144)		(8)		(15)
(write-downs)/recovery of inancial assets (receivables)	(2)		78		(28)
Capitalization of Internal Construction Costs	4.667		4.506		2.320		1.429
EBIT	32.400	(2.042)	22.334	(1.610)	7.852	(721)	8.274	(1.106)
Income (loss) from Investments	(70)		$\Omega$		-
of which related parties	90
Other Financial Income	4.580		693		1.593	$\overline{\phantom{0}}$	202
Interest Expenses	(6.000)		(5.658)		(2.138)		(1.836)
of which related parties	(93)		(124)		(29)		(46)
FX Gains and Losses	2.072		598		1.544		338
Profit Before Taxes	32.983	(2.042)	17.967	(1.610)	8.852	(721)	6.978	(1.106)
Income Taxes	(6.846)		(3.710)		(389)		(1.632)
Net Profit (Including Portion Attr. to Minority)	26.137	(2.042)	14.258	(1.610)	8.463	(721)	5.346	(1.106)
Net Profit Attributable to Minority Interest	$\Omega$		$\Omega$
Net Profit Attributable to the Group	26.137	(2.042)	14.258	(1.610)	8.463	(721)	5.346	(1.106)

Appendix

Consolidate Income Statements – Revenues 9M

9M			BCF (fiber for carpet)				NTF (fiber for fabric)					Polymers						Total
€/mil	2022	2021	Δ	Δ%	2022	2021	Δ	Δ%	2022	2021	Δ	Δ%	2022	2021	Δ	Δ%	% 22	% 21
EMEA	171,9	137,4	34,5	25,1%	79.2	62,2	17,0	27,2%	42,2	55,5	(13, 3)	$(24,0)\%$	293.2	255,	38,	14,9%	55,3%	60,8%
North America	126,9	65,5	61,4	93.8%	24,6	21,5	3.1	14,5 %	2,8	5,2	(2, 4)	(46.4)%	154,3	92,2	62,	67,4%	29,1%	22,0%
Asia e Oceania	76.0	65,4	10,6	16,2 %	3,0	4,2	(1,2)	$(28,3)\%$	0,8	0,5	0,3	0.0 %	79,8	70,1	9.7	13,9 %	15,1%	16,7%
RoW	0,6	0.4	0.2	47,5 %	2,0	1.5	0,5	32,3 %	0,0	0,0	(0, 0)	0.0 %	2,6	1.9	0,7	35,5%	0,5%	0,5%
Total	375,3	268,7	106,6	39,7%	108,8	89,4	19,4	21,7%	45,8	61,2	(15, 4)	$(25,2)\%$	529,9	419,3	110,6	26,4%	100,0%	100,0 %
$%$ ToT	70,8%	64,1%			20,5%	21,3%			8,6%	14,6%			100,0%	100,0%

Appendix

Consolidate Income Statements – EBITDA & EBITD Adj

RECONCILIATION FROM NET PROFIT TO EBITDA $\epsilon/000$	September 2022	September 2021	Third Quarter 2022	Third Quarter 2021
Net Profit (Including Portion Attr. to Minority)	26.137	14.258	8.463	5.346
Income Taxes	6.846	3.710	389	1.632
Investment income and charges	70.
Amortisation & Depreciation	35.954	33.381	12.198	10.068
Write-downs & Write-backs of intangible and tangible assets	(164)	66	36	15 1
Financial items (*)	2.319	6.557	(116)	2.072
No recurring items $(**)$	2.042	1.610	721	1.106
EBITDA	73.205	59.581	21.691	20.239
Revenue	529.905	419.310	178.896	144.610
EBITDA Margin	13,8%	14,2%	12,1%	14,0%

RECONCILIATION FROM EBITDA TO EBIT ADJUSTED $\epsilon/000$	September 2022	September 2021	2022	Third Quarter Third Quarter 2021
EBITDA	73.205	59.581	21.691	20.239
Amortisation & Depredation	35.954	33.381	12.198	10.068
Write-downs & Write-backs of intangible and tangible assets	(164)	66	36	15
EBIT Adjusted	37.414	26.134	9.457	10.156
Revenue	529.905	419.310	178.896	144.610
EBIT Adjusted Margin	$7,1\%$	6,2%	5,3%	7.0%

Appendix Consolidate Balance Sheet (1)

CONSOLIDATED BALANCE SHEET	At September 30,	At December 31,
$\epsilon/$ 000	2022	2021
Intangible Assets	22.458	23.551
Goodwill	17.121	14.735
Tangible Assets	251.353	240.489
Financial Assets	765	710
of which related parties	318	318
Investments & Equity metod	1.018	1.018
Other Assets	476	626
Deferred Tax Assets	14.609	12.269
Total Non-Current Assets	307.800	293.398
Inventories	261.566	177.243
Trade Receivable	41.907	31.233
of which related parties	47	71
Financial Current Assets	4.544	860
Current Tax Receivables	740	423
Other Current Assets	17.955	12.853
of which related parties	114	3.152
Cash and Cash Equivalents	136.634	152.656
Asset held for sales	$\bf{0}$	$\bf{0}$
Total Current Assets	463.346	375.268
Total Current Assets	771.146	668.666

Appendix Consolidate Balance Sheet (2)

CONSOLIDATED BALANCE SHEET	At September 30,	At December 31,
$\epsilon/$ 000	2022	2021
Share Capital	49.722	49.722
Reserves	115.353	91.708
Group Net Profit for the year	26.136	10.670
Group Shareholders Equity	191.212	152.101
Net Equity attributable to minority interest	1
Net Profit for the year attributable to minority interest	$\Omega$	$\Omega$
Total Sharholders Equity	191.213	152.102
Employee Benefits	5.380	5.910
Non-Current Financial Liabilities	293.186	263.421
of which related parties	6.545	6.359
Provisions for Risks and Charges	1.504	1.929
Deferred Tax Liabilities	13.463	11.158
Other Payables	9.365	10.813
Total Non-Current Liabilities	322.898	293.230
Current Financial Liabilities	79.469	69.438
of which related parties	3.184	2.240
Current Tax Payables	3.362	1.721
Trade Payables	147.772	126.566
of which related parties	296	352
Other Liabilities	26.432	25.608
of which related parties	230	230
Total Current Liabilities	257.035	223.334
Total Equity and Liabilities	771.146	668.666

NET FINANCIAL DEBT	At September 30,	At December 31,
$\epsilon/$ 000	2022	2021
A. Liquidity	136.634	152.656
B. Cash and cash equivalents
C. Other current financial assets	4.544	860
D. Liquidity $(A + B + C)$	141.178	153.516
E. Current financial debt (induding debt instruments but exduding the current
portion of non-current financial debt)	$-3.143 -$	203
F. Current portion of non-current financial debt	$-76.326 -$	69.236
G. Current financial debt $(E + F)$	$-79.469 -$	69.438
H. Net current financial debt (G - D)	61.709	84.078
I. Non-current financial debt (exduding current portion and debt instruments)	$-222.872-$	180.185
J. Debt instruments	$-70.314 -$	83.210
K. Trade payables and other non-current payables
L. Non-current financial debt $(I + J + K)$	$-293.186 -$	263.396
M. Total financial debt $(H + L)$	$-231.477 -$	179.318

Appendix Consolidated Cash Flow Statement (1)

	At September At September
30,	30.
2022	2021
26.137	14.258
$-358$	$-141$
6.846	3.710
70	0
$-90$	o
$-4.580$	-693
6.000	5.658
93	124
$-2.072$	-598
$-91$	$-132$
-166	144
2	$-78$
35.954	33.381
68.100	55.650
$-84.323$	-14.691
21.206	30.493
-56	$-82$
$-10.675$	$-7.542$
24	17
2.259	3.505
3.038	377
$-1.419$	$-4.965$
$-1.098$	0
$-1.299$	$-527$
$-7.249$	61.923

Appendix Consolidated Cash Flow Statement (2)

CASH FLOW STATEMENT		At September At September
$\epsilon$ /000	30,	30,
	2022	2021
Investing activities
Investment in Tangible Assets	$-24.566$	$-20.547$
Disposal of Tangible Assets	406	291
Investment in Intangible Assets	$-3.213$	$-3.640$
Disposal of Intangible Assets		22
Dividends	90
Disposal of Financial Assets	$-160$
Cash Flow used in Investing Activities (B)	$-27.444$	$-23.875$
Financing Activities
Increase in no current Loan and borrowing	79,000	$\Omega$
Decrease in no current Loan and borrowing	$-42.502$	$-73.304$
Net variation in current and not current fiancial Assets and Liability indueded IFRS 16	$-441$	$-7.217$
of which related parties	1.130	$-2.440$
Net variation non-monetary increase IFRS16	$-6.964$	$-2.800$
Dividends Distribution	$-6.046$	$\bf{O}$
Acquisition of treasury shares	$-4.376$
Cash Flow from Financing Activities (C)	18.671	$-83.321$
Net Cash Flow of the Year $(A)+(B)+(C)$	(16.022)	(45.273)