CENIT AG

Earnings Release • May 15, 2023

CENIT GROUP – AT A GLANCE 1 JANUARY TO 31 MARCH 2023 (UNAUDITED)

in EUR k	01/01 - 31/03/2023	01/01 - 31/03/2022	Change in %
Key data
Revenue	43,416	35,398	22.7
3rd party software	22,278	21,473	3.8
from licences	1,178	1,248	-5.6
from recurring sales*	21,101	20,225	4.3
Proprietary software	3,351	3,628	-7.6
from licences	362	792	-54.3
from recurring sales*	2,988	2,836	5.4
Consulting and ser vices	17,746	10,272	72.8
Merchandise	41	25	64.0
EBITDA	1,572	726	>100.0
EBIT	6	-387	>100.0
as % of sales	0.01	-1.09	>100.0
Net income	-73	-512	85.7
per share in cent (basic and undiluted af ter minority interests)	-2.4	-7.1	66.2
Cash flow data
Cash flow from current business activities	8,694	11,196	-22.4
Cash flow from investment activity	-2,189	-158	>100.0
Cash flow from financing activity	-1,781	-749	>100.0
Balance sheet ratios	31/03/2023	31/12/2022	Change in %
Liquid assets	24,595	19,914	23.5
Bank liabilities	-20,528	-21,353	-0.1
Total assets	137,686	127,037	8.4
Equity ratio in %	32.4	35.3	-8.2
Employees on reporting date	854	861	-0.8

* Subscription and software maintenance contracts

Report on assets and financial and earnings situation

Strong consulting and business services (vs. previous year: +72.8%) and growth in recurring revenue (vs. previous year: +4.5%) define the sales performance (EUR +8,018 k/+22.7% vs. previous year) in Q1 2023

In Q1/2023, CENIT continued its growth path in line with the last quarters 2022. Total revenue grew by EUR 8,018 k (vs. previous year: +22.7%). In particular, consulting and business services, which grew by EUR 7,474 k (vs. previous year: +72.8%) compared to last year, contributed significantly to this achievement. This overperformance is due to the combined effect of the Group acquisitions and a sustain demand in our PLM segment.

In the meantime, software sales grew by EUR 542 k (vs. previous year: +2.1%). Recurring revenue grew by EUR 1,025 k, which ensures a sustainable part of CENIT revenue development.

CENITs consolidated EBIT reached in the first quarter 2023 EUR 6 k (previous year: EUR -387 k); the profitability is increasing year on year, thanks to sales development combined with costs monitoring and productivity gains.

Overview of segments

In the first three months of 2023, both segments, PLM and EIM were equally successful and were able to increase their results compared to the same quarter of the previous year. The PLM area increased segment revenues by EUR 1,952 k compared to the previous year and was able to increase segment EBIT by EUR 292 k, which resulted in a segment EBIT of EUR -381 k. Thanks to acquisitions, the EIM segment exceeded the revenues of the prior-year quarter by EUR 6,066 k and was thus also able to increase segment EBIT by EUR 101 k to EUR 387 k.

Earnings per share slightly improved by an increasing result

Earnings per share improved to Cent -2.4 (previous year: Cent -7.1) in Q1/2023, due to the improved Group result.

Continuous very solid financial strength thanks to an operating cash flow of EUR 8,694 k and cash and cash equivalents of EUR 24,595 k

In the first three months of the fiscal year, CENIT Group generated a cash flow of EUR 4,724 k (previous year: EUR 10,289 k). The change in cash flow is due to lower cash flow from operating activities (EUR -2,502 k), investments in future development of the company as well as repayment of financial and lease liabilities (EUR 1,781 k). The Group's liquidity increased by EUR 4,724 k compared to December 31, 2022 to reach cash and cash equivalent amount of EUR 24,594 k at the end of March 2023.

A constantly consolidated equity ratio of 32.4%, and a growing amount of cash and cash equivalents characterize the CENIT Group's asset position. At the same time, the consolidated balance sheet total increased by EUR 10,649 k compared to December 31, 2022.

Events after the interim report period

There were no significant events after the end of the interim reporting period on March 31, 2023.

Employees

As of the reporting date March 31, 2023, the CENIT Group had 854 employees (31/12/2022: 861).

Report on opportunities and risks

For information on the principal opportunities and risks for the anticipated development of the CENIT Group, we refer to the relevant comments in the report on expected developments within the Group's management report for the period as of December 31, 2022.

Dividends paid or proposed for payment

At the General Meeting of Shareholders on May 17, 2023, the Managing Board and the Supervisory Board of CENIT will propose the payment of a dividend of EUR 0.50 per share for the 2022 business year. If the General Meeting approves this proposal a total amount of EUR 4,184 k will be paid to the CENIT AG shareholders.

Report on forecasts and other statements regarding anticipated development

Over the course of a year, business activity is subject to certain seasonal fluctuations. In the past, contributions to sales and earnings tended to be lowest in the first quarter and highest in the fourth quarter, primarily due to a traditionally strong year-end business for the software industry. Consequently, interim results have only limited value as indicators of results for the whole fiscal year.

For the current year, our outlook for the CENIT Group is to reach a revenue of around EUR 175,000-180,000 k and earnings (EBIT) of around EUR 9,000-9,500 k. This forecast does not include any acquisition effects.

CENIT AKTIENGESELLSCHAFT, STUTTGART CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (IN ACCORDANCE WITH IFRS) (UNAUDITED)

in EUR k	01/01 - 31/03/2023	01/01 -31/03/2022
REVENUE	43,416	35,398
Other operating income	330	217
OPERATING INCOME	43,746	35,615
Cost of materials	18,074	16,997
Personnel expenses	20,640	15,649
Amortisation of intangible assets and depre ciation of property, plant and equipment	1,566	1,113
Other operating expenses	3,388	2,228
OPERATING EXPENSES	43,668	35,987
Impairment from trade receivables	-72	-15
NET OPERATING INCOME (EBIT)	6	-387
Interest income	0	0
Interest expenses	249	35
NET PROFIT (LOSS) BEFORE TAXES (EBT)	-243	-422
Income taxes	158	-90
NET INCOME CONTINUED OPERATIONS	-85	-512
Net Income/Loss discontinued operations	12	0
NET INCOME	-73	-512
Amount attributable to CENIT AG shareholders	-202	-598
Amount attributable to non-controlling interests	129	86
Earnings per share in EUR, basic and diluted	-2.4	-7.1
Items that, under certain circumstances, will be reclassified under the income statement in the future
Compensation from currency translation for foreign subsidiaries	-52	47
Other comprehensive income after taxes	-52	47
Total comprehensive income	-125	-465
Amount attributable to CENIT AG shareholders	-254	-551
Amount attributable to non-controlling interests	129	86

CENIT AKTIENGESELLSCHAFT, STUTTGART CONSOLIDATED STATEMENT OF FINANCIAL POSITION (IN ACCORDANCE WITH IFRS) (UNAU DITED)
in EUR k	31/03/2023	31/12/2022
ASSETS
NON-CURRENT ASSETS
Intangible assets	40,198	37,626
Property, plant and equipment	12,491	13,371
Investments recognised to equity	59	59
Other financial assets	8,841	9,988
Deferred tax assets	1,069	1,017
NON-CURRENT ASSETS, total	62,658	62,061
CURRENT ASSETS
Inventories	111	72
Trade receivables	25,369	26,032
Receivables from investments recognised to equity	3,159	3,891
Contract assets	1,542	1,639
Current tax assets	4,179	2,222
Other receivables	268	425
Cash holdings	24,595	19,914
Assets discontinued operations	806	0
Other assets	14,999	10,781
CURRENT ASSETS, total	75,028	64,976
TOTAL ASSETS	137,686	127,037

CENIT AKTIENGESELLSCHAFT, STUTTGART CONSOLIDATED STATEMENT OF FINANCIAL POSITION (IN ACCORDANCE WITH IFRS) (UNAUDITED)
in EUR k	31/03/2023	31/12/2022
LIABILITIES
EQUITY
Subscribed capital	8,368	8,368
Capital reserves	1,058	1,058
Currency translation reserve	1,345	1,397
Legal reserve	418	418
Other reserves	13,787	13,787
Profit carried forward	17,805	11,522
Net income	-202	6,283
Equity attributable to shareholders in the parent company	42,579	42,833
Non-controlling interests	2,079	1,950
EQUITY, total	44,658	44,783
NON-CURRENT LIABILITIES
Other liabilities	511	511
Pension liabilities	827	844
Lease liability, non-current	7,606	8,144
Other finacial liabilities	1,661	1,660
Deferred tax liabilities	2,758	2,830
NON-CURRENT LIABILITIES, total	13,363	13,989
CURRENT LIABILITIES
Liabilities to bank	20,528	21,353
Trade payables	5,783	11,163
Liabilities from investments recognised to equity	0	26
Other liabilities	14,898	13,273
Lease liability, current	2,928	3,349
Current income tax liabilities	757	558
Other provisions	93	74
Liabilities linked to assets of discontinued operations	460	0
Contract liabilities	34,218	18,469
CURRENT LIABILITIES, total	79,665	68,265
TOTAL ASSETS	137,686	127,037

CENIT AKTIENGESELLSCHAFT, STUTTGART CONSOLIDATED STATEMENT OF CASH FLOWS (IN ACCORDANCE WITH IFRS) (UNAUDITED)
in EUR k	01/01 - 31/03/2023	01/01 - 31/03/2022
Cash flow from operating activities
Net income	-73	-512
Depreciation of fixed assets	1,566	1,113
Interest income and expenses	249	35
Tax expenses	-158	90
Increase in other non-current assets	1.147	0
Increase in other non-current liabilities and reserves	-11	2
Change in working capital	6.654	10,916
Interest paid	-201	-4
Income taxes paid	-478	-444
CASH FLOW FROM CURRENT BUSINESS ACTIVITIES	8,694	11,196
Payments for investments in property, plant and equipment and intangible assets	-457	-158
Payments for purchase of shares in fully consolidated entities (net cash out flow)	-1.732	0
CASH FLOW FROM INVESTMENT ACTIVITIES	-2,189	-158
Lease liability payments	-956	-749
Repayment of financial liabilities	-825	0
CASH FLOW FROM FINANCING ACTIVITIES	-1,781	-749
CHANGES IN CASH AND CASH EQUIVALENTS	4.724	10,289
Change in cash and cash equivalents due to foreign exchange differences	-43	60
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE REPORTING PERIOD	19,914	26,361
CASH AND CASH EQUIVALENTS AT THE END OF THE REPORTING PERIOD	24,595	36,710

CENIT AKTIENGESELLSCHAFT, STUTTGART STATEMENT OF CHANGES IN EQUITY (IN ACCORDANCE WITH IFRS) (UNAUDITED)
	Equity attributable to shareholders in the parent company
in EUR k	Subscribed capital	Capital reserves	Currency translation re serve	Revenue reserves Legal reserve	Other reserves	Profit carried forward	Net in come	Non-controlling interests	Total
On 01/01/2022	8,368	1,058	1,159	418	14,076	13,547	4,251	768	43,645
Reclassification of net in come of the Group from prior year						4,251	-4,251
Total comprehensive income for the period			238		429		6,283	326	7,276
Addition to basis of consoli dation								2,260	2,260
Dividends paid to minority in terests								-523	523
Step-up of minority interests					-718			-881	-1,600
Dividend distribution						-6,276			-6,276
On 31/12/2022	8,368	1,058	1,397	418	13,787	11,522	6,283	1,950	44,783
Reclassification of Group net income from last year						-6,283	6,283
Total comprehensive income for the period			-52				-202	129	-125
On 31/03/2023	8,368	1,058	1,345	418	13,787	17,805	-202	2,079	44,658

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