Annual Report (ESEF) • May 1, 2025
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CONTENT INTRODUCTION 3 Ebusco at a glance 3 MANAGEMENT BOARD REPORT * 6 Message from the CEO 7 Composition of the Management Board 8 Strategy 9 Operational review 13 Financial review 15 Our sustainability journey 18 Risk management and internal control 31 Management statement 40 GOVERNANCE 41 Corporate governance 42 Composition of the Supervisory Board 48 Report of the Supervisory Board 49 Remuneration report 54 FINANCIAL STATEMENTS 59 Consolidated statement of prot or loss and other comprehensive income 60 Consolidated statement of nancial position 61 Consolidated statement of changes in equity 62 Consolidated statement of cash ows 63 Notes to the consolidated nancial statement 64 COMPANY FINANCIAL STATEMENTS 94 Company statement of prot or loss 94 Company statement of nancial position 95 Notes to the company nancial statements 96 OTHER INFORMATION 100 Provisions of the articles of association relating to prot appropriation 101 Update on Independent auditor’s report 102 Shareholder information 103 Five year overview 104 Non-IFRS measures 105 Organisation Ebusco 107 * The chapters marked with a * are part of the report of the Management Board as dened in article 2:391 of the Dutch Civil Code ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCEMANAGEMENT BOARD REPORT 2 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCEMANAGEMENT BOARD REPORT 3 EBUSCO AT A GLANCE Ebusco is a developer and distributor of zero emission buses as well as a sup- plier of complementary battery powered solutions, primarily in the transporta- tion industry. Its dedication for sustainable transportation drives the company to engineer and deliver buses and energy storage systems that provide value across their lifecycle and set standards in zero-emission transportation. For the past 12 years, Ebusco has been dedicated to advancing the transportation sector with the goal of making sustainable, emission-free transport the norm rather than the exception. The company offers products such as electric public transport buses, the Ebusco 2.2 and 3.0, as well as energy solutions such as Mobile Energy Containers (MEC). Ebusco has consistently focused on making electric bus operations more affordable by focusing on energy efciency resulting in a low Total Cost of Ownership (TCO). The Ebusco 2.2 was the company’s rst widely implemented electric bus and has been performing reliably for several years, showcasing solid perfor - mance and a low TCO. Building on this foundation, Ebusco developed the Ebusco 3.0, featuring a light - weight, fully composite body that enables a longer range and reduced energy consumption, further opti - mizing TCO efciency. The Ebusco 3.0, with currently more than 100 buses on the road, is showing great real-road performance. Ebusco offers comprehensive After Sales support for the buses that are in operation. With a data-driven approach, the company not only ensures ef cient support but also gains valuable insights to drive product improvements. Both models are on the road throughout Europe and are providing sustainable public transport in Denmark, the Netherlands, Germany, Belgium, France, Switzer - land and Spain. Ebusco also provides energy solutions and throughout 2024 successfully implemented maritime energy solutions on various ships, supporting sustainable boating. Ebusco is headquartered in Deurne, the Nether- lands and had an additional facility in Venray. The company announced that, these facilities will be merged, reducing the locations in the Netherlands to one facility. The decision has been made to real- locate the Venray facility to Deurne. Ebusco also has a production facility in Cléon – France. For the assembly of the buses, Ebusco cooperates with various contract manufacturers. On 31 December 2024, the company had a workforce of 522 FTE’s. The shares of Ebusco are listed and traded on Euronext Amsterdam (AMS:EBUS) since 22 October 2021. PRODUCT OFFERING EBUSCO EBUSCO 2.2 The Ebusco 2.2 is the rst widely implemented electric bus of Ebusco and has been engineered by the company and rened over the last years. The Ebusco 2.2 offers a range of up to 550 kilo- meters on a single charge, supporting efcient daily operations while reducing time and infra- structure demands. It comes in various sizes—12 meters, 13 meters, and 18 meters—and offers congurations for low-oor or low-entry designs, allowing for tailored solutions to suit diverse operational needs. EBUSCO 3.0 The Ebusco 3.0 is a lightweight electric bus, designed with a composite body to maximize ef- ciency and performance, offering a range of up to 700 kilometers. The lightweight structure of the Ebusco 3.0 makes this bus highly cost efcient and allows for the use of single tires, reducing material costs while creating a wider and more accessible aisle for passengers. This design enhances both passenger comfort and overall accessibility. This bus currently comes in 12 and 18 meter models and offers congurations for low-oor or low-entry designs, allowing for tailored solutions to suit diverse operational needs. AFTERSALES Ebusco provides comprehensive support to ensure efcient operations for its clients. This includes pre-delivery training and detailed operational and service instructions. The Ebusco Live system offers real-time monitoring of charging activities, battery status, and other service-re- lated aspects of the bus. Ebusco also offers a range of service contracts tailored to different needs, such as full-service contracts, spare parts supply, preventive maintenance, and high-voltage system maintenance. To address operational disruptions, the Company operates a 24/7 helpdesk and provides remote diagnostic capabilities to facilitate rapid issue resolution. EBUSCO 2.2 EBUSCO 3.0 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCEMANAGEMENT BOARD REPORT 4 EBUSCO ENERGY MOBILE ENERGY CONTAINERS – MEC These MEC’s are movable energy storage units that are applicable for various situations, for example in the maritime sector, enabling ships to operate on hybrid or fully electric power along designated routes by using these swappable energy containers, and afliated docking stations. MARITIME BATTERIES Ebusco Energy provides heavy-duty battery packs certied for maritime applications, making them ideal for inland shipping. These batteries are available in single or multiple pack congurations. All the above-mentioned Ebusco Energy solutions feature LFP batteries, providing stable perfor- mance, high energy density, and enhanced safety as well as a Battery Management System (BMS) providing real live performance data of the batteries. EBUSCO ENERGY FLEX The Ebusco Energy Flex is a mobile fast-charging system designed for electric and hybrid vehi- cles, including cars, trucks, and buses. In addition to this charging system, it can also be used as an energy storage system. Its ability to move and be remotely controlled gives it a unique level of mobility. The Energy Flex can be recharged through the electrical grid or sustainable sources such as solar panels and wind turbines, can temporarily store power, and distribute it when needed. COMPLETE ECOSYSTEM ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCEMANAGEMENT BOARD REPORT 5 MANAGEMENT BOARD REPORT Message from the CEO 7 Composition of the Management Board 8 Strategy 9 Operational review 13 Financial review 15 Our sustainability journey 18 Risk management and internal control 31 Management statement 40 CONTENT ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 6 MANAGEMENT BOARD REPORT MESSAGE FROM THE CEO ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 7 MANAGEMENT BOARD REPORT 2024 has been an extremely challenging year for Ebusco, and 2025 continues to be challenging. While we have already taken signicant steps, we recognize that there is still a long way ahead and the liquidity situation is still a major challenge. It won’t be a surprise that my rst months as CEO of Ebusco have been very intensive. I joined Ebusco at a critical moment, in the midst of a massive and urgent turnaround, operationally and nancially. Let me start with a positive observation. Since joining the company, my condence in the unique strength of the Ebusco 3.0 has deepened even further. Its lightweight design, oor-loaded battery, and superior engineering deliver exceptional quality, as demon - strated by its outstanding real-world performance. Therefore, despite the tough road ahead with several challenges and uncertainties still lingering, I can see a path forward, if we succeed in managing our liquidity challenges and in the meantime getting production and the supply chain under control, Ebusco’s unparal - leled offering in a growing market does present oppor- tunities. And rebuilding trust with our customers, suppliers, partners, and shareholders will be key. When I started in September, my top priority was to improve liquidity and reduce working capital while thoroughly assessing root causes and validating strategic choices. This effort has resulted in a clear, actionable roadmap—comprising several projects for immediate impact along with strategic pillars to guide long-term progress, including the decision to transition to an OED model. An OED model enables us to operate more capi- tal-efciently and reduce our risk prole. By lever- aging our strengths—our top-tier product design and engineering capabilities—while outsourcing processes that have hindered our ability to scale, we can enhance our performance. Combined with other strategic choices, such as simplifying our portfolio to standard bus sizes and focusing on European markets. We are positioning the company to navi- gate the challenges ahead and ultimately become resilient again. On the short term, our focus was, and is, on mana- ging liquidity, delivering outstanding orders, reassig- ning buses from canceled orders and monetizing our inventory to generate cash. In addition, we diligently work on strengthening our ties with all our partners and redesigning our processes to regain control over our supply chain. The strategic changes require our organization to transition from a full edge production company to a support organization, bringing a shift in roles and skills sets. Furthermore, in alignment with the need to establish a leaner and more efcient company structure, we had to make the difcult decision to signicantly reduce Ebusco’s workforce. Although necessary for the company’s future, these decisions are undoubtedly painful as they impact many of our colleagues. The past year has presented signicant challenges for the entire organization, demanding extraordi- nary perseverance from all employees. I extend my sincere appreciation for the continued commitment, resilience, and loyalty shown throughout this dif- cult period. The changes also extend to the company’s manage- ment. I am very pleased to have Michel van Maanen on board to oversee Ebusco’s core process at Ebusco and implement the new operating model, bringing invaluable expertise from his proven track record in similar transformations. I would like to thank Jan Piet Valk for his support and guidance as interim CFO. Jan Piet has played a key role for the company in this turbulent period. Despite all progress, efforts and envisioned plans, we must acknowledge that even after fully imple- menting the Turnaround Plan, Ebusco will need a strong partner to be able to scale the business and be sustainably successful. This also applies to our growing, but still small, Energy storage business. Backed by our strong partner and shareholder Gotion, we see a business case for the Maritime niche market, where we are well positioned as one of the few certied compa- nies. We believe both businesses deserve focus, and we are currently exploring strategic options to ensure both businesses can thrive under the right gover- nance. Although the future holds many uncertainties, I believe we are on the right path. Market fundamen- tals are strong with the electrication trend ongoing. And the market continues to value our product. COMPOSITION OF THE MANAGEMENT BOARD IN 2024 PETER BIJVELDS (1978) Current term expires in 2025 Peter Bijvelds established Ebusco in 2012. Peter Bijvelds has over 20 years of experience in the automotive sector. Peter Bijvelds is a Dutch national and he has in-depth knowledge of the (public) transport market and its constituents and strong exper- tise across the full electric bus value chain. CEO ROALD DOGGE (1970) Employed until December 2024 Roald Dogge worked as the COO at NTS Group and has many years of experience as head of production overseeing 10 locations in both Europe and Asia. Prior to that, he worked for more than a decade in the automotive sector, where he occupied various roles at Volvo, inclu- ding Technical Director, Business Development Manager, and Brand Director at Volvo Bus. Roald Dogge is a Dutch national and holds a degree from HTS in mechanical engineering & technical commerce. * Mr. Dogge stepped down as COO of Ebusco as per 31 December 2024. As of 1 January 2025, Michel van Maanen has taken on the role of COO. He was appointed as member of the Management Board at the EGM on 26 March 2025. COO JURJEN JONGMA (1971) Employed until November 2024 Jurjen Jongma was CFO at Versuni, formerly known as Philips Domestic Appliances. Prior to that, he held nancial positions within Royal Philips for over 25 years, including in the role of CFO for various Philips business units, as well as Head of Internal Audit for Royal Philips. Jurjen Jongma is a Dutch national and holds a master's degree in economics from Tilburg University, as well as an executive master's in nance & control from Maastricht University. CFO FOUNDER CHRISTIAN SCHREYER (1968) As of September 2024 Current term expires in 2028 Christian Schreyer has over 25 years of expe- rience within the public transport and logis- tics sector. Throughout his career, he has held various management positions at Deutsche Bahn and served as CEO for DB Schenker Rail Poland, Transdev North and Central Europe, and Go Ahead Group. Christian Schreyer is a German national and holds a master's degree in law degree from Ludwig- Maximilians Universität Munich and pursued a General Management Programme at Harvard Business School in Boston USA. * Mr. Jongma stepped down as CFO of Ebusco as per 30 November 2024. As of 25 November, Jan Piet Valk has taken on the role of interim CFO. He is not a formal member of the Management Board. Ebusco is actively seeking a (permanent) candidate for this role. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 8 MANAGEMENT BOARD REPORT Christian Schreyer – CEO Michel van Maanen – COO Peter Bijvelds – Founder COMPOSITION OF THE MANAGEMENT BOARD ON 30 APRIL 2025 STRATEGY Ebusco contributes to a more sustainable world by decarbonizing public trans- port. The company focuses exclusively on zero-emission solutions and strives to help its customers achieve their environmental goals with efficient and cost-ef- fective solutions. Ebusco focuses on engineering and delivering buses and energy storage systems that provide value across their lifecycle. In addition to providing zero-emission buses and products, the company's strategy is to minimize the li- fetime environmental footprint of its products and solutions from cradle to grave. Since its inception, Ebusco has focused on delive- ring the most efficient electric buses to the market. In its early years, the company focused on research, development, and engineering, while collaborating closely with contract manufacturers to produce its buses externally. During this period, Ebusco also developed the innovative Ebusco 3.0, a lightweight bus with a composite body. As full in-house production did not meet the anti- cipated output, the company adopted a hybrid pro- duction model for the Ebusco 3.0 in 2023, combi- ning in-house manufacturing with external contract manufacturing. However, by mid-2024, it became clear that the hybrid model was not meeting its de- livery and cost objectives. In response, Ebusco is in the process of transitioning to an Original Equipment Design (OED) production model, retaining in-house design and development while outsourcing producti- on and assembly to contract manufacturers. THE OED MODEL This shift to an OED production model aims to improve performance and reliability of the manu- facturing process and to reduce inventory requi- rements of the company. Ebusco’s ongoing focus is on optimization of its production footprint while maintaining full flexibility. Ebusco can produce its casco monoparts either inhouse at its own facility or through its contract manufacturer for casco produc- tion. Bus assembly, as it is phased out in the Nether- lands as of early 2025, will be solely handled by contract manufacturers. Currently Ebusco works together with various contract manufacturers for the assembly of the Ebusco 3.0. At Pre Delivery Inspection (PDI), buses are finalized and inspected in-house in the Netherlands and France as this process involves close collabora- tion with the customer, enabling Ebusco to review the buses together and implement any necessary improvements or adjustments. As part of this production setup, contract manu- facturers play a bigger role in the procurement of components and overall planning and control of the supply chain. Ebusco intends to increase direct ship- ments of components to these contract manufactu- rers, thereby reducing the number of components supplied by the company. However, Ebusco remains heavily involved in the product and supplier selec- tion and for the essential products. Clear roles, governance, and responsibilities between the company and its partners aims to ensure efficient operations and reliable production outcomes. As a result of this change to the OED model, the workforce is further reduced, following a reorganization that is implemented in the first months of 2025. The produc - tion and warehousing are being phased out and other departments were rightsized. SALES AND MARKETING STRATEGY While previously Ebusco intended to expand globally, the company has chosen to focus on the European market, allowing Ebusco to allocate resources more efficiently and capitalize on the European market's growth oppor - tunities. The company's primary target groups are Public Transport Authorities (PTAs) and Public Transport Operators (PTOs), as both play key roles in decision-ma - king for the procurement of public transport buses. All of Ebusco's products and services are authorized for sale in its target areas. Besides this European focus market, Ebusco has the aim of licensing the technology of the lightweight 3.0 bus outside Europe. In addition to these focus areas and groups, Ebusco will, as part of its commercial plan, evaluate each tender it intends to enter even more critically to ensure that the requested customizations and modifi - cations are feasible within its current capabilities and resources. Ebusco’s capacity planning will be based on production slots available, meaning in practice that orders will only be accepted if there are available production slots that can accommodate the produc - tion requirements within the desired timeframe of customer delivery. Ebusco expects that this will lead to a lower level of customization, further standardization and streamli - ning of production, and a more reliable output, espe- cially for the Ebusco 3.0. STRATEGIC PARTNERSHIP WITH GOTION In November 2024, Ebusco agreed a strategic part- nership with Gotion. Gotion has been a longstanding battery supplier to Ebusco. The partnership envisages mobilizing Gotion’s advanced battery technology, allowing the further development of Ebusco’s lightweight buses with a substantially longer range battery, supporting Ebusco in exploring possibilities to license out its Ebusco 3.0 lightweight technology in Asia, and cooperation in relation to the expansion of Ebusco’s maritime offe - ring. EBUSCO ENERGY Ebusco has identified strong demand for its Ebusco Energy product portfolio and is leveraging its high- value, hard-to-obtain maritime certificates to capi - talize on this high-barrier market. To ensure the efficiency, effectiveness, and growth of its Energy Solutions activities, Ebusco has established a dedi - cated team focused exclusively on these operations. This team optimizes the entire value chain, from sales and engineering to operations and after-sales. Addi - tionally, Ebusco enhances its product offerings and accelerates time-to-market through strategic part - nerships. This is demonstrated by the recently signed strategic partnership with Gotion, which envisions to jointly explore further opportunities to grow Ebusco’s energy solutions. Ebusco and Gotion have already taken successful first steps in the field of maritime energy solutions with m ultiple mobile battery solu- tions implemented. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 9 MANAGEMENT BOARD REPORT OUR VALUE CREATION MODEL Founded more than a decade ago on the strong belief that electrification is the future, Ebusco is an industry pioneer with innovation in its DNA. Ebusco aims to contribute to the energy transition in public transportation. We contribute to sustainable public transportation and align our goals with the United Na- tions Sustainable Development Goals. 4 5 6 7 Component manufacturing Manufacturing and assembly End of life, waste and recycling Transportaon Delivery use and maintenance Research, development and design Raw material & semi finished product sourcing 2 1 3 Key Input 3 Ebusco operated facilies and 4 assembly partners Low-weight carbon body 567 employees from 34 naonalies 788 buses on the road in 7 countries Key Output 236.07 ton kilogram of nitrogen (NOx) emissions avoided 140.47 million kilogram of Co2 emissions avoided 151.91 million zero-emission kilometers driven VALUE CHAIN IMPACT BUSINESS MODEL STAKEHOLDER IMPACT Business partners & suppliers Shareholders Customers Employees Governement & regulators Environment Drivers & passengers * As announced in 2024, Ebusco will raonlize its producon footprint leading to a reduced number of locaons ** Cumulave, since the founding of Ebusco (not assured). ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 10 MANAGEMENT BOARD REPORT * As announced in 2024, Ebusco will rationlize its production footprint leading to a reduced number of locations ** Cumulative, since the founding of Ebusco (not assured). STAKEHOLDERS INTRODUCING OUR STAKEHOLDERS THEIR KEY EXPECTATIONS OF EBUSCO OUR ENGAGEMENT AND OUTCOMES Our customers are mainly public transit operators (PTO), public transit authorities (PTA) and parties operating in heavy duty energy consumption, who contract with us through procurement and tender processes. Customers expect Ebusco to deliver buses on time and according to specications agreed, and to comply with regulatory requirements. In addition, they expect a good after-sales setup. We engage with customers and regulators to understand their requirements and processes. Our customers can reach us 24/7 End 2024 we had 522 FTE. We rely on highly skilled people, such as composite, electrical, industrial, and automotive engineers. Employees value an inspiring, safe working environment as well as fair and competitive remuneration and benets. Our employees are our most important assets. We engage with our employees through our internal communication initiatives and directly through the HR cycle. We have a remuneration policy that aims to attract, moti- vate and retain qualied employees. Our business partners and suppliers strengthen the inno- vative nature and quality of our offering. We build solid, long-lasting partnerships with our business partners that are essential to our success. Suppliers’ long-term planning and product development take Ebusco’s business plans into account. We engage with our suppliers through alignment with our ethical and sustainable behavior standards. We also engage with our suppliers through alignment with our ethical and sustainable behavior standards. We share data and insights with our business partners and suppliers for mutual benet and development. We involve suppliers in our future developments in support of our future roadmap. Drivers and passengers are the daily users of our buses. They require affordable, available, safe and reliable trans- port. Our role is to provide safe, convenient and sustainable public transport. We engage with bus drivers through our training programs. We receive continuous customer feedback about bus performance and how this impacts users. As a listed company, we have shareholders who have invested in Ebusco shares. Shareholders invest in Ebusco to receive a long-term return on investment in a transparent setting. Share- holders expect us to communicate timely, clearly and accurately. We engage with shareholders at the annual general meeting, through Euronext notices and via press releases and other information on our websites. Our manage- ment engages with shareholders and potential investors through road shows and investor conferences. Government and regulators develop laws and regulations relating to public transport contracts’ award, administra- tion, performance, and procurement processes. They also issue policies and regulations to support and accelerate the green transition. Governments expect public transport buses in public transport to be efcient, economical and easily accessible to everybody, including people with disabilities. Govern- ments expect us to contribute to the green transition by providing economically viable electric bus transport. We engage with national and international public parties by responding to public consultation processes (before laws are materializing). We are subject to periodic audits and reviews by various government agencies. The environment provides us with the natural resources needed to manufacture, assemble and operate buses. This includes energy, water and raw materials. We aim to reduce the depletion of natural resources. Our zero-emission buses offer a sustainable alternative to diesel buses, contributing to the energy transition. Addi- tionally, we are committed to reducing the environmental footprint of our own operations. Banks support Ebusco by facilitating nancial transac- tions, including Letters of Credit, which are essential for procurement and project nancing. Banks expect nancial stability, transparency, and compliance with regulatory requirements. They seek timely repayments and risk management in nancial dealings. We maintain open communication with banks, providing nancial disclosures and risk assessments. As good corporate citizens aligned with the Dutch Corporate Governance Code, we nurture our allian- ces with various stakeholders and consider their interests when making strategic business decisi- ons. As part of our business model, we have many strategic partnerships with various stakeholders. Engaging with our stakeholders is crucial to iden- tify important trends and developments in our mar- kets at an early stage. Open dialogue enables early recognition of opportunities and risks and ensures that we remain responsive to the needs of our va- rious stakeholders. The following stakeholder matrix provides an over- view of our stakeholders and why they are relevant to us. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 11 MANAGEMENT BOARD REPORT Significant MajorModerate IMPACT MATERIALITY Moderate Significant FINANCEL MATERIALITY Data Integrity Customer Satisfaction Human Rights Health & Safety Climate change adaption Energy Consumption Sustainable Supply Chain Climate Change Mitigation Waste & Circular Economy Community Engagement Nature and biodiversity Water Consumption Pollution (air, water & soil) Regulatory Compliance Cyber Security Business Ethics Financial Environment Sustainable Innovation Product Leadership Diversity & Inclusion Environmental Social Business & Governance OUR MATERIALITY ASSESSMENT MATERIALITY AND KEY PERFORMANCE INDICATORS We are committed to making Ebusco more sustaina- ble and are working to integrate Environmental, Social & Governance (ESG) practices into our core business. In 2022 we established our double-materiality ap- proach and continued this in 2023, providing insight into our impact on ESG related issues (impact mate- riality) and how these issues affect Ebusco’s perfor- mance and financial position (financial materiality). This resulted in the materiality matrix below. In 2025 we will review the materiality assessment based on the strategic shift to the OED model. In 2023 we did a CSRD/ESRS gap analysis, which we performed together with an independent consul- tant to identify our non-financial reporting needs in terms of KPIs. First actions were taken to bridge the reporting gap that was identified. That same year we also took further steps in validation and assurance as an auditor provided limited assurance on six of our main non-financial KPIs. In 2024 Ebusco's focus was fully on its Turnaround Plan, as a consequence there were no actions taken regarding CSRD repor- ting (as further clarified on page 18) and validation and assurance. We will continue this exercise in 2025. In 2025, we will work towards setting targets for the main performance indicators. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 12 MANAGEMENT BOARD REPORT OPERATIONAL REVIEW INTRODUCTION 2024 was another extremely challenging year in many aspects. While in the past few years the company focused on growth and hence scaling up its production, in 2024, the strategic shift from an OEM to an OED operating model required a company-wide turnaround. As a consequence, many operational functions have been or will be outsourced to contract manufacturers. Hence, this turnaround also involves aligning the operational structure and the workforce accordingly. PRODUCTION In 2023 Ebusco introduced a hybrid manufacturing model, combining in-house manufacturing with contract assembly to enhance efciency. Despite these efforts, the anticipated delivery output was still not met. This resulted in delivery penalties due to not meeting contractually agreed delivery dates. In 2024, Ebusco operated three locations: two in the Netherlands, in Deurne and Venray, and one in Cléon, France. The location in Deurne, at the compa - ny’s headquarters, focused on casco manufacturing and bus assembly, while Venray served as the sole Pre-Delivery Inspection (PDI) location. Cléon func - tioned as the second casco manufacturing site. Production, sales and inventory were impacted by several factors in 2024, including start-up inef- ciencies during the transition of the assembly process, the insufcient set-up of the supply chain to contract manufacturers and industry wide supply chain challenges. These factors strongly affected Ebusco's ability to satisfy contracts related to the delivery of buses, mobile energy containers and energy storage systems, resulting in late delivery penalties. This consequently hampered Ebusco’s performance and deepened delivery issues, with production nearly coming to a standstill in the second half of 2024. In 2024 Ebusco has decided to fully adopt an Original Equipment Design (OED) manufacturing model, in which buses are designed and engineered by Ebusco, but assembled by contract manufacturers, instead of being produced in-house. This shift will simplify the supply chain and work- ows of the Ebusco 3.0 in particular, as it reduces the number of production locations. Bus assembly will be handled solely by contract manufacturers and Ebusco’s in-house bus assembly will be fully phased out. In 2024, Ebusco collaborated with three contract manufacturers for the assembly of the Ebusco 3.0. The Turnaround Plan envisions part- nering with only two contract manufacturers for bus assembly and one contract manufacturer for casco production. Pre delivery inspection (PDI), continues to be done inhouse by Ebusco in Europe. The Ebusco 2.2 and the Ebusco 3.0 partially differ from an outsourcing perspective. The contract manu - facturer of the Ebusco 2.2 is allowed to make its own choices in terms of production and procurement as opposed to the Ebusco 3.0. After bus assembly, the buses are shipped to Ebusco’s facilities in Europe, where it performs post-production activities and pre delivery inspection. The Management Board has clearly dened roles and responsibilities between Ebusco and its contract manufacturers in the OED manufacturing model, including a clear governance structure and a better 'build' methodology, in order to control output. ORDERBOOK DEVELOPMENT Ebusco ended 2024 with an order book of 581 1 buses. Throughout the year, Ebusco delivered 157 buses and signed contracts for 48 buses. Due to Ebusco's nancial situation, production nearly came to a standstill in the second half of 2024, resulting in delayed deliveries and the cancel- lation of 361 bus orders by customers in 2024. The production of the majority of these cancelled buses was not yet initiated, and their cancellation ulti- mately led to a more realistic production planning. The cancelled buses that were in an advanced stage of production have been prioritised by Ebusco as these buses can contribute to the working capital in a rela - tively short period of time. As a result, during 2024, the company reallocated 21 canceled buses to NIAG and 22 buses to Rouen. In February 2025, an additional 31 buses were allocated to EBS. In 2025 to date, Ebusco has received cancellation notices for a total of 55 buses. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 13 MANAGEMENT BOARD REPORT 1 Ebusco’s Management Board has made an assessment of the likelihood of outstanding options being converted into xed contracts. As a result, the previously announced gures have been restated, excluding options from the orderbook. With this adjustment, Ebusco aims to provide a more accurate picture of its order book given the situation the company is in currently. Most of these buses are not yet in an advanced stage of production and therefore, are expected to be assigned to other customers, and arrangements to this effect are already underway. The company expects to reallocate STAFFING Per 31 December 2024, we employed 567 people across 6 countries, of which 88.6% worked in the Neth - erlands. Our workforce represents 34 nationalities. As part of the Turnaround Plan, Ebusco has signif- icantly reduced FTEs and took initiatives to create a leaner organization. This process is being imple- mented in a well-structured way to minimise disrup- tions. Over time, the number of FTEs has come down from 893 FTEs as per year-end 2023 to 522 FTEs per year-end 2024. Additionally, on 31 December 2024, the company announced an organizational restruc- turing, set to be largely implemented in the rst quarter of 2025. This additional restructuring involves a further reduction of 102 FTEs, mainly related to the production, warehouse, and facility departments. In addition to the reduced workforce, Ebusco intro- duced a revised management setup. In order to achieve a leaner organization, the company decided to dissolve the Executive Committee and to manage the company directly from the Management Board. In the new setup the COO is fully responsible for the core process of the organization from bus sale, engineering, production, to after sales. This will lead to clearer, more reliable processes and responsibilities and, ultimately, a stronger cooperation with all partners throughout the entire value chain. For the organizational setup as per 1 January 2025, we refer to page 107. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 14 MANAGEMENT BOARD REPORT 19 cancelled buses that are in a more advanced stage of production to existing customers in the second half of 2025. The table below shows a summary of the bus orders by end of year 2024. 2 There is no guarantee that these call-off orders will be converted into xed orders as customers may not be successful in winning tenders or for other reasons. However, if the customer orders an electric bus, it is contractually obliged to ask Ebusco to deliver it rst. Contract Call off 2 Options Total Ebusco 2.2 79 168 247 Ebusco 3.0 257 77 334 Total 336 168 77 581 Ebusco Energy contributes with various energy storage products, such as 20 Mobile Energy Containers. The table below shows a summary of the Ebusco Energy order book and contains Mobile Energy Containers (MEC), Ebusco Maritime Battery (EMB) and Ebusco Charging Systems (ECS). Fixed Option Mobile Energy Containers (MEC) 20 Ebusco Maritime Battery (EMB) 2 Ebusco Charging Systems (ECS) 7 5 Total 29 5 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 15 MANAGEMENT BOARD REPORT FINANCIAL REVIEW INTRODUCTION 2024 was marked by significant strate- gic realignments and operational chal- lenges which resulted in disappointing financial results. Revenue decreased from €102.4 million in 2023 to €10.7 million which is mainly due to the can- cellation of certain bus contracts, for which the Company was required to re- verse previously recognized revenues, and production halts as a result of li- quidity constraints. The operating loss increased from €103.8 million in 2023 to €196.4 million in 2024. The increase compared to prior year is mostly the result of write- offs of inventory also driven by the referred to contract cancellations and xed asset impairments following the Company’s change from an OEM to OED model. This had a total impact of approximately €80 million. RESULTS OF OPERATIONS The following table summarises the Group's nan- cial performance for the years ended 31 December 2024 and 2023. year ended 31 December (€ thousands) (Unaudited) 2024 2023 Revenue 10,665 102,440 Cost of materials (45,267) (109,288) Gross prot (34,602) (6,848) Employee benet expenses (42,501) (38,467) Amortization and depreciation (63,747) (8,136) Other operating expenses (55,532) (50,418) Operating expenses, excluding cost of materials (161,780) (97,021) Operating result (EBIT) (196,382) (103,869) Finance expenses, net (3,305) (932) Share of result of an associate (1,156) (871) Result before tax (200,573) (105,672) Operating result (EBIT) (196,382) (103,869) Amortization and depreciation expenses (63,747) (8,136) EBITDA (132,635) (95,733) For further information and calculation of the non-IFRS measures, reference is made to page 105-106. COMPARISON OF THE YEARS ENDED 31 DECEMBER 2023 AND 2024 REVENUE Full-year 2024 revenue arrived at €10.7 million. As communicated, the Company received several bus order cancellations mostly in the second half of 2024 as a result of the Group’s failure to deliver the contract buses in the required timeframe. Due to applied revenue recognition accounting policy for these cancelled contracts, it was required to reverse the previously (in both 2023 and the rst half of 2024) recorded revenue in 2024. Although the Group was able to reassign these cancelled orders, this does not further contribute to the 2024 revenue and subsequent nancial result. In addition, the Company’s production had nearly come to a standstill in the second half of 2024 which resulted in minimal bus deliveries and subsequent revenues. GROSS PROFIT Gross prot decreased by €27.8 million to €34.6 million negative in 2024 from €6.8 million negative in 2023. The gross prot is signicantly impacted by the increase in the Company’s inventory obso- lescence reserve of €26.2 million during 2024. The Company considered the impact of the bus contract cancellations and the results of its inventory sales when determining the reserve per 31 December 2024. Ebusco’s cost of materials includes costs of mate- rials (including parts and other components), cost of contracted work (relating to third-party production partners) and other external costs, including transpor - tation costs, import duties, and spare parts. Further- more, the Group’s inventory allowance and warranty provisions are also included in the gross prot. For further information and calculation of gross prot, reference is made to the non-IFRS measures on page 105-106. EMPLOYEE BENEFIT EXPENSES Employee benet expenses increased by €4 million from €38.5 million in 2023 to €42.5 million in 2024. This increase is mainly due to the increase in the average number of full-time employees. The average number of full-time employees (excluding temporary employees) increased by 3% from 502 FTEs in 2023 to 517 FTEs in 2024. In addition, the Group’s total remuneration of its key management increased by €1.4 million. AMORTIZATION AND DEPRECIATION Amortization increased from €2.3 million for 2023 to €45.7 million in 2024. The increase mainly relates to the goodwill (related to the Pondus acquisition in 2021) impairment of €39.3 million as a result of the Company’s annual impairment test. In addition, an impairment was recorded for the implementation of a new ERP system. The Company decided, also driven by its liquidity constraints, to continue with its current ERP system. Depreciation increased from €5.8 million in 2023 to €18 million in 2024. Both the depreciation of prop- erty, plant and equipment and right-of-use assets ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 16 MANAGEMENT BOARD REPORT were signicantly impacted by the Turnaround Plan as the Company decided to shift from an OEM to an OED model and to merge the two Dutch Ebusco locations (Venray and Deurne) into one, being Deurne. The latter resulted in a partial impairment of the right-of-use asset for the lease of the facility in Venray for €1 million. Furthermore, the strategic OEM to OED shift involves Ebusco focusing on designing and engineering its buses while outsourcing the assembly process to contract manufacturers. This however also results in the Group no longer requiring part of its (special - ized) manufacturing equipment and machinery. The assessment results in an impairment of €8.4 million. OTHER OPERATING EXPENSES The following table summarises the Group's other operating expenses for the periods indicated. year ended 31 December Other operating expenses (In thousands of euro) (Unaudited) 2024 2023 Cancellation settle- ment expenses 12,105 - General expenses 11,683 7,599 Temporary employees 16,600 24,696 Distribution expenses 5,080 5,247 IT expenses 3,796 3,584 Marketing expenses 255 1,156 Facility expenses 3,661 4,088 Ofce expenses 302 384 Other operating expenses 2,050 3,664 Total 55,532 50,418 Other operating expenses increased by €5.1 million from €50.4 million in 2022 to €55.5 million in 2024. The increase is mostly driven by the settlement expenses related to the earlier referred to contract cancellations. The general expenses mostly contain audit, advisory, insurance fees. The increase is mostly due to the Company incurring additional advisory expenses as part of the set-up of its Turnaround Plan. The increase is offset by the decrease in temporary employees, which is also mostly the result of the Company’s shift in its business model. OPERATING RESULT (EBIT) Considering the elements driving the negative gross prot, the signicant impairments and contract cancellation expenses, the operating result amounts to a loss of €196.4 million for 2024 (2023: loss of €103.9 million). For further information and calculation of the EBIT, reference is made to the non-IFRS measures on page 105-106. EARNINGS PER SHARE The Company restated its earnings per share for 2023 following both the 5 to 1 share consolidated (conducted in October 2024) and successfully completed rights issue in November 2024. The earn- ings per share per 31 December 2024 amounts to a negative €10.79 from a negative €24.39 which is mostly due to the increase in the weighted average number of shares to 18,602,405 from the (restated) 11,843,492. LIQUIDITY AND CAPITAL RESOURCES OVERVIEW The Group's primary use of liquidity is for the day-to-day operation of its business relating to the production and assembly of buses, capital expen- ditures and other investments is further detailed below and on the next pages CASH FLOWS The following table presents a summary of the Group's cash ows for the periods indicated, which have been extracted from the Financial Statements. year ended 31 December (€ thousands) (Unaudited) 2024 2023 Net cash ows from operating activities (43,175) (103,799) Net cash ow from investment activities (16,933) (20,071) Net cash ows from nancing activities 34,586 56,576 (Decrease)/Increase in cash and cash equivalents (25,521) (67,293) Exchange gains/(losses) on cash and cash equivalents 2 (1) Cash and cash equivalents at the start of the period 27,918 95,212 Cash and cash equivalents at the end of the period 2,399 27,918 COMPARISON OF THE YEARS ENDED 31 DECEMBER 2023 AND 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net cash outow from operating activities for 2024 was €43.2 million, compared to a net cash outow of €103.8 million for 2023. The decrease is most signi- cantly driven by the Company purchasing less inventory considering its inventory built up during previous years. Furthermore, the Group received additional customer prepayments during 2024 which caused the contract liabilities to increase compared to 2023. CASH FLOWS FROM INVESTING ACTIVITIES Net cash outow from investing activities for 2024 was €16.9 million compared to €20.1 million for 2023. The decrease was mainly due to less investments in intan- gible xed assets as a result of the discontinuation of the Company’s EPR implementation and a lower capital contribution in its associate Zero Emission Services B.V. CASH FLOWS FROM FINANCING ACTIVITIES Net cash inow from nancing activities for 2024 was €34.6 million (2023: €56.6 million), which is most signicantly driven by the proceeds from the succes- sfully completed rights issue in November 2024 for €36 million. FREE CASH FLOW Free cash ow amounts to €61.6 million negative compared to €123.5 million negative in 2023. The diffe- rence is mainly caused by the decrease from operating activities by €60 million. For further information and calculation of the free cash ow, reference is made to the non-IFRS measures on pages 105-106. NET WORKING CAPITAL The Group calculates net working capital as inventories, including contract assets, plus trade receivables minus trade payables and contract liabilities. As of 31 December 2024, the net working capital amounted to €61.3 million (31 December 2023: €144.0 million). The decrease in net working capital of €82.6 million is mainly caused by the development in inven- tories/contract assets and contract liabilities. As a result of the earlier referred to contract cancellations the Company reclassied the respective contract assets (related to these cancelled contracts) to its inventory (work-in-progress), although the impact is partially offset by the impact of the addition to the inventory allowance reserve of €26.2 million. In addi- tion, the Company’s contract liabilities increased from ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 17 MANAGEMENT BOARD REPORT €18.9 million to €44.4 million as a result of customer prepayments, mostly relating to the Company’s energy storage business. Finally, the accounts receivable posi- tion decreased from €19.3 million to €5.5 million. For further information and calculation of net working capital, reference is made to the non-IFRS measures on pages 105-106. CAPITAL EXPENDITURE Investments in property, plant and equipment amounted to €14.5 million, mainly related to its ofce in Deurne and production facilities in Venray and Rouen (France). NET (CASH)/DEBT The Group’s net debt position, excluding lease liabilities, per 31 December 2024 was €20.8 million, an increase of €14.2 million compared to a net debt position of €6.6 million per 31 December 2023. The increase in the net debt position is mainly due to the decrease in cash and cash equivalents for an amount of €25.5 million, partly offset by decrease in loans and borrowings. The following table presents the Group's net (cash)/ debt (including and excluding lease liabilities) as per 31 December 2024 and 2023. For further information and calculation of the net (cash)/debt, reference is made to the non-IFRS measures on pages 105-106. EQUITY Total equity decreased by €150.8 million to €27.5 million as at 31 December 2024 (2023: €178.3 million), mainly due to the net loss for the year of €200.8 million partly offset by the share capital increase of €54.1 million following the rights issue and (share) repayments of the convertible bonds as issued in December 2023. CAPITAL EMPLOYED Capital employed decreased by €145.0 million from €194.1 million as at 31 December 2023 to €49 million as at 31 December 2024 mainly due to a decrease of the Company’s total assets following the earlier mentioned impairments of xed assets and addition to the inventory obsolescence reserve. For further information and calculation of capital employed, reference is made to the non-IFRS measures on pages 105-106. DIVIDEND POLICY AND PROPOSED DISTRIBUTION Pursuant to article 31 of the articles of associ- ation of the Company, the Management Board, with the approval of the Supervisory Board, may decide that prots realized during a nan- cial year are fully or partially appropriated to increase and/or from reserves (article 31.1). The prots remaining shall be put at the disposal of the General Meeting. The Management Board, with the approval of the Supervisory Board, shall make a proposal for that purpose. A proposal to pay a dividend shall be dealt with as a separate agenda item at the General Meeting of Sharehol- ders (article 31.2). The Company does not intend to declare or pay dividends for the nancial year ending 31 December 2024 or in the medium term. The net loss attributable to equity holders of the Group for 2024 of €200.7 million (2023: net loss of €119.2 million) will be deducted from retained earnings. (€ thousands) (Unaudited) 31 December 2024 31 December 2023 Debts to credit institutions 5,359 1,348 Debt to a third party 17,845 33,126 Sub-total loans and borrowings 23,204 34,474 Lease liabilities 24,511 16,598 Cash and cash equivalents (2,399) (27,918) Net (cash)/debt including lease liabilities 44,920 23,154 Lease liabilities (24,511) (16,598) Net (cash)/debt excluding lease liabilities 20,805 6,556 OUR SUSTAINABILITY JOURNEY Founded more than a decade ago on the strong belief that electrification is the fu- ture, Ebusco is an industry pioneer with sustainable innovation in its DNA. Ebusco aims to contribute to the energy transition in public transportation. We have start- ed on our sustainability journey, integrating a first seven priority SDGs (see our Value Creation Model, page 10), the material topics identified in our materiality assessment and current sustainability priorities. In 2024, we took further steps to prepare for the upco- ming CSRD reporting requirements. However, amid a challenging year and ongoing difcult circumstances, we were not able to dedicate as much attention to sustainability as we had initially envisioned. We recognize that our current reporting does not yet include a detailed description of sustainability-re- lated goals in relation to key groups of products and services, customer categories, geographical regions, or stakeholder relationships. Similarly, disclosures regarding the assessment of current signicant products and services, signicant markets, and customer groups in relation to sustainability-related goals, as well as elements of strategy that relate to or impact sustainability matters, that we have been working on but are not yet in place. Dependent on how and when the CSRD regulations will apply to Ebusco, we continue to prepare our readiness to report in accordance with the CSRD requirements. In addition, we will work towards setting targets for our main performance indicators. Next to the CSRD compliance we have the following priorities for 2025: • We will review the life-cycle assessment (LCA) gi- ven the changed production set-up, shifting to an OED model. • We will use the outcomes of the LCA and the En- vironmental Product Declaration (EPD) we disclo- sed in Q1 2024 for current and future tenders. • We will work with our suppliers to further imple- ment value chain risk analyses, including moving towards compliance with minimum safeguards to protect human rights as part of the EU Taxonomy (and in line with CSDDD), for which we use external data and tooling, and apply audits based on high- risk area’s. • We will calculate our scope 3 emissions to under- stand potential opportunities to reduceemissions in our supply chain. • We will review our policy and align targets and acti- ons accordingly. • We will continue integrating and extending the UN SDG’s into the different layers of our organization. The next chapters describe how we aim to contribute to the three sustainability pillars, environmental, social and governance and how we have set up the gover - nance of our sustainability efforts and organisation. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 18 MANAGEMENT BOARD REPORT 89.45% 10.55% Recoverable Non Recoverable RECOVERABILITY 12M 91.38% 08.62% Recoverable Non Recoverable RECOVERABILITY 18M ENVIRONMENTAL Our zero-emission buses contribute to reducing emissions in public transport and also reduce nega- tive effects of pollution in cities. • Reduced energy consumption: The lightweight composite body of the Ebusco 3.0 bus, combined with a highly efcient driveline and high isola- tion value, results in industry-leading low energy consumption per kilometer driven. Combined with its range (up to 700 km), the Ebusco 3.0 offers a compelling proposition. • Data-driven operational optimization: Real-time eet data allow for operational optimization: We monitor the operational performance of our buses through a digital, real-time eet management system. The data provide information and insights on the basis of which we can further optimize operational performance, including scheduling predictive maintenance, and implement design improvements. These operational and design improvements contribute to a further reduction of GHG emissions. • Longer lifespan and recoverability: Effective inte- gration of composite material minimizes the use of steel. Composites age considerably slower than steel. This takes the expected lifespan of our casco to 25 years, which is more than double that of conventional buses. However, during the use phase of the bus, parts such as the interior or batteries will need to be refurbished. The costs and environ- mental impact are signicantly lower compared to assembling a new bus. Damage to the body can be repaired modularly, simply and cheaply by either the operator at their own workshop or by Ebusco. All this has a positive impact on the environmental footprint of the bus. Our recoverability rate (ability to recover in %) for the 3.0 12m and 18m bus is displayed below: ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 19 MANAGEMENT BOARD REPORT END OF LIFE, WASTE AND RECYCLING As the Ebusco 3.0 body is based on composites, there is less corrosive impact. Ebusco buses can have an expected technical life cycle up to 25 years (including battery replacement and refurbishment), resulting in a lower total cost of ownership, resource intensity and its overall footprint. When decommissioned, parts are reused where possible. In the case of composites, we 3.0 12-Meter 3.0 18-Meter -0.001 0.000 0.001 0.002 0.003 0.004 0.005 0.006 EoL credit EoL burden Use phase Assembly Processing Material GWP using ReCiPe midpoint H methode for the two Ebusco 3.0 buses; 12m and 18m from cradle-to-grave including the break-down TOTAL: 0.0046 TOTAL: 0.0050 kg CO2 eq/p.km lifetime travel distance and using dedicated renewable energy sources) • The material composition of the battery, to reduce toxicity and address resource scarcity. After the completion of the LCA, we have successfully developed and veried an Environmental Product Declaration (EPD). The EPD, disclosed in Q1 2024, helps our clients, and other relevant stakeholders, to assess and compare our product footprint results and put them in perspective relative to our competitors. The new production set-up might have an impact on the LCA, notably expected in the assembly and processing phase. We will review the LCA to further assess the impact of the changes. LIFE-CYCLE ASSESSMENT ON THE 3.0 (AS BUS FULLY MANUFACTURED IN DEURNE) In what phase of its life cycle does a zero-emission bus cause the biggest environmental impact? Many people assume this happens during the production phase or when a bus is decom- missioned. In fact, most CO2 is produced in the “use phase” of the bus, which highlights the need to strive for lower energy consump- tion while driving, which in turn emphasises the importance of lower weight and increased heating or cooling efciency. To establish this fact, we completed a life-cycle assessment (LCA) analysis in 2023 for the 3.0 12-meter and 18-meter bus and battery. These have been executed by TNO, a well-known Dutch independent research institute. The LCA is a holistic evaluation of environmental impacts and resource use from the raw materials used to the bus’s end of life. The LCA is based on the ISO 14040/14044 guidelines and is exter- nally veried by an auditor. The LCA used a cradle-to-grave approach that included battery production, usage and waste treat- ment. The results showed that the ‘use phase’ of the bus had the highest contribution to the carbon footprint and many other environ- mental impact categories, followed by ‘mate- rial production’. For impacts related to toxicity and resource scarcity, ‘material production’ has the highest contribution. The assessment results help to prioritise improvements. Two areas of improvement emerged: • Electricity use during the use phase of the bus, to further reduce its carbon footprint (for example, by increasing efciency or also work with partners to improve recyclability and alternative uses. With regards to battery circularity, they can sometimes get a second life in our energy storage systems. Part of the Life-Cycle Assessment (LCA) and Environmental Product Declaration (EPD) analyses was to calculate the recyclability rate (ability to recycle the materials in %) of the 3.0 12m and 18m bus, which are displayed below: 84.53% 15.47% Recyclable Non Recyclable RECYCLABILITY 12M 83.93% 16.07% Recyclable Non Recyclable RECYCLABILITY 18M ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 20 MANAGEMENT BOARD REPORT THE ENVIRONMENTAL IMPACT OF OUR OPERATIONS The image below shows a simplied overview of key elements of the adjusted production set-up of the Ebusco 3.0 and 2.2. In this future set-up Ebusco works with only three assembly partners. The production process consists of three main steps, namely Casco production, Bus Assembly and Pre-Delivery Inspection (PDI). Under the new production strategy, with assembly to take place at contract manufacturers, Ebusco intends to grow direct shipments of components to these contract manufacturers, thereby reducing the number of components shipped and supplied by the Company. The production setup: 1 Casco production in 2024 was handled at the Ebusco site in Deurne (the Netherlands), and Cleon (France) and casco assembly was performed as well as at a contract manufacturer site. As part of the ongoing optimization of Ebusco’s production footprint and in order to maintain full exibility, Ebusco can also produce casco monoparts at its contract manufacturer for casco production, while at the same time maintaining the ability and therewith the option to operate the full casco production inhouse at one of its own facilities.This phase is only applicable for the Ebusco 3.0 as the Ebusco 2.2’s traditional steel body is constructed within the bus assembly process. 2 Bus assembly was handled at Ebusco’s site in Deurne as well as at contract manufacturers. In 2024 Ebusco worked together with three contract manufacturers for the assembly of the Ebusco 3.0. For the future, Ebusco decided to discontinue bus assembly in Deurne and has the aim to down- size to two contract manufacturers. 3 The PDI (Pre-Delivery Inspection) was handled at one location at Ebusco’s site in the Netherlands. The Scope 1 (direct greenhouse (GHG) emissions that occur from sources that are controlled or owned by an organization) and 2 (indirect GHG emissions asso- ciated with the purchase of electricity) CO 2 emission impact is shown in the Ebusco copper color, scope 3 (emissions that are the result of activities from assets not owned or controlled by the reporting orga- nization, but that the organization indirectly affects in its value chain) impact is shown in anthracite. Scope 1 / 2 Ebusco Scope 3 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 21 MANAGEMENT BOARD REPORT OUR OWN OPERATIONS emissions for a production facility. We use elec- tricity from the grid at our plants in Cléon, Venray and Deurne. For our location in Deurne 100% is compensated through green certicates. In Venray we also have solar panels on our roof that cater for a fair amount of our electricity usage. • Gas: we use a limited amount of gas in our ofce facilities, and in certain production processes in Cléon, Venray and Deurne, which in total amounted to 244 ,409 m 3 for the entire year. We continuously strive to minimize the impact of Ebusco’s activities on the environment through the responsible use of raw and ancillary materials and by reducing waste, water discharge and emissions. We started designing and manufacturing buses in Deurne in 2019, which allowed us to avoid the burden of legacy assets and processes. • Energy: Due to the unique carbon design of the bus our energy consumption is lower compared to competitors. Hence, this results in relative low KEY PERFORMANCE INDICATORS 642.50 Tons of CO 2 eq scope 1 ghg emissions (2023: 376.70) 41.39 Total energy consumption per net revenue (in 100k) (2023: 4.74) 585.59 Tons of gross location-based CO 2 eq scope 2 ghg emissions (2023: 922.82) 8.43 GHG emissions per net revenue (in 100k) (2023: 0.71) 85.57 Tons of gross market-based CO 2 eq scope 2 ghg emissions (2023: 111.89) 4,414.10 MWH total energy consumption for own operations (2023: 4,891.48) * Emissions and fuel consumption for the in-house casco and bus assembly still active in 2024 are also included in the gures. Scope 1 emissions have almost doubled in 2024 compared to 2023 due to more company cars and fuel use and scope 2 reduced slightly due to use of green energy (wind). Since the 2024 revenue was a fraction of the 2023 revenue, this also impacts the KPI’s related to the revenue. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 22 MANAGEMENT BOARD REPORT KEY PERFORMANCE INDICATORS SOCIAL The expertise and capabilities of our employees play a critical role in the development, production, and commercialisation of innovative mobility solutions. We recognise that maintaining a healthy and safe work environment is essential. TURNAROUND PLAN AND REORGANIZATIONS The year 2024 was exceptionally challenging for Ebusco and for our employees. As part of the Turnaround Plan aimed at creating a more stream - lined and efcient organization and a better align- ment with the new production (OED) model, a reorga- nization was implemented. This restructuring led to a reduced workforce, with the number of employees decreasing from nearly 900 to just over 500 full-time equivalents (FTEs) over the course of the year. In the rst quarters of 2025 the execution of an additional restructuring took place, reducing the workforce by another 102 FTEs. These steps are obviously difcult for the employees affected, but necessary to improve Ebusco’s (nancial) performance. Social plans are in place and we strive to balance efcient decision-ma - king with ongoing care and support for our employees. CULTURE AND CORE VALUES Our core values dene our culture and guide us in the way we act and work together. Everyone in the company is responsible for living up to these values. The core values are embedded in the code of conduct. We placed signicant focus on reinfor- cing our core values, ensuring that our employees’ conduct aligned with these values at all times. 84% Employee retention rate (in 2023: 90%) 5.21% Absenteeism (in 2023: 4.49%) 41.11% Employee turnover (in 2023: 21.03%) 28 Interns per year (in 2023: 39) 119.09 Average working hours per month (in 2023: 100,983) 133 Temporary employees hired (in 2023: 509) 23% Engineer or R&D professionals, of total workforce (in 2023: 19.2%) 1.21% Employees with WAO or WIA status, of total workforce (in 2023: 1.15%) * Retention rate over the year based on employees who voluntarily resigned. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 23 MANAGEMENT BOARD REPORT HEALTH AND SAFETY We strive to ensure a safe and healthy work environ- ment for our employees while designing products that meet the highest standard of customer safety. Our approach to health and safety is set out in the Ebusco Code of Conduct. All employees are jointly responsible for health, safety and the environment at the sites where they perform their work activi- ties. This means being mindful of their conduct and how it might affect other team members. As such, employees receive formal training and are trained to suspend work in unsafe situations and report this to their supervisors. These guidelines are set out in the health and safety manual and the internal reporting process. The following internal arrangement” support the health and safety guidelines: • Employees have access to voluntary consultations aimed at preventing health problems. • A full risk inventory and evaluation is performed at least every four years or more frequently when extensive production changes are implemented. The most recent veried and approved version is of last year. • An emergency response team is in place, consisting of trained employees that are able to implement Ebusco’s emergency roadmap. In the event of an environmental incident, our employees are expected to immediately report to both their supervisor and the Quality, Health & Safety, Sustainability and Environment (QHSSE) Director and to take appropriate measures to prevent a dangerous situation. In such situations, employees must always follow the instructions of the inhouse or external emergency response ofcer. Employees complete compulsory safety training before starting their jobs and have access to a health and safety manual as further guidance. KEY PERFORMANCE INDICATORS 14.12 LTIFR (2023: 8.14) 10 Recordable incidents (2023: 10) 0 Fatalities (2023: 0) 4.59 LTIFR own employees (2023: 3.41) 40% Of recordable incidents due to unsafe conditions (2023: 30%) 1 Environmental incidents (2023: 2) 19.54 LTIFR contractors (2023: 20.00) 15 Lost time accidents (2023: 38) 16 Incidents due to unsafe acts out of 48 total work related incidents (2023: 28) In Q1 2025, we have successfully completed the stage 1 audit on ISO45001, with the certication audits planned end of Q2 resulting in certication in Q3. This in addition to maintain our certication, with audit procedures, on ISO 9001 and ISO 14001. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 24 MANAGEMENT BOARD REPORT DIVERSITY AND INCLUSION At Ebusco we are committed to offer equal opportuni- ties for everyone in all aspects of employment. When discussing promotions or lateral moves, we focus solely on skills and motivation, regardless gender, nationality or other factors not related to the job at hand. Moreover, we have zero tolerance for discrimination based on age, race, skin colour, religion, gender, national origin, sexual orientation, disability, or any other protected class. We have a Diversity Policy in place aimed at fostering diversity in the entire workforce. Employees are expected to contribute to a respectful and inclusive working environment, free from inappropriate behav - iour or attitudes such as sexual harassment, aggres- sion and violence, discrimination, stalking, bullying, abuse of power, insults and slander. At the end of 2024 19% of our workforce is female and 81% is male (2023: 19% female and 81% male). The table below reects the division between female and male of our own employees (excluding temporary employees and reported as headcount), spread over age groups. Age Female Male %Female %Male Total <19 1 4 20% 80% 5 20 - 29 20 79 20% 80% 99 30 - 39 46 142 24% 76% 188 40 - 49 18 79 19% 81% 97 50 - 59 9 75 11% 89% 84 60 - 69 2 35 5% 95% 37 70 - 80 1 4 20% 80% 5 Total 97 418 19% 81% 515 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 25 MANAGEMENT BOARD REPORT GOVERNANCE As we develop a sustainable sourcing strategy focused on local markets, we plan to further inte - grate social and environmental criteria in the supplier engagement process. This will include addressing material aspects such as human rights, ethics, cyber security and compliance. BUSINESS ETHICS We developed a governance and risk management structure to ensure that employees, contractors and suppliers comply with all laws and regulations in terms of corruption, bribery, human rights, tax and anti-competition. Ebusco’s Code of Conduct outlines our commitment to achieving competitive advantage through supe- rior performance and never through unethical or unlawful business practices. Ebusco’s policy is to fully comply with all applicable legislation and regu- lations. No Ebusco employee or service provider is allowed to offer, promise, give, provide or demand bribes or other inappropriate benets, directly or indirectly, to win or retain business. This includes giving civil serv- ants or supplier employees an inappropriate mone- tary or other advantage. All employees as well as the Supervisory Board members, are required to conrm in writing that they have read and taken due note of the Code of Conduct, understand it and will comply with it. Non-compliance may lead to disciplinary measures being imposed by the Management Board. Our suppliers’ general terms and conditions include an ethical code of conduct section. Suppliers are required to uphold the highest ethical business standards when conducting business. Furthermore, we published our Supplier Code of Conduct at the end of 2023. HUMAN RIGHTS We are committed to respecting human rights and labor standards, aligning our practices with the leading international standards; the UN Guiding Principles on Business and Human Rights and the OECD Due Diligence Guidelines for multinational enterprises on Responsible Business Conduct. This commitment is reected in our Human Rights Policy that is published on our investor website. In addition, our Human Rights policy and the Ebusco Code of Conduct explicitly prohibit direct or indi- rect employment of children, in accordance with the International Labor Organization (ILO) Conven- tions 138 (the Minimum Age Convention) and 182 (the Worst Forms of Child Labor Convention). We do not employ children and strictly prohibit any forced labor. We realise that our responsibility towards upholding human rights is not limited to our own operations. In every stage of our value chain, human rights can be at risk, and we acknowledge our responsibility to use the relationships that we have with our suppliers, customers and other business partners to promote that human rights are respected. In addition to that, we are constantly working to prevent or mitigate potential adverse human rights impacts that are connected to our business operations, products or services. Aligned with our commitment to upholding human rights, we started with the implementation of a human rights due diligence process. Together with external experts, we conducted a corporate human rights risk assessment, in which we identied the most severe human rights risks in each step of our value chain. This analysis systematically identied both actual and potential impacts across the entire value chain, ranging from those associated with the extraction of raw materials to those inherent in the design of our buses and extending to considerations at the end of the product life cycle. This assessment helps us pinpoint the areas of risk that require heightened attention. To illustrate this, we are aware of the specic human rights risk associated with battery production and the mining of metals and minerals and hence we conducted an external audit on our battery production supplier in China, in collaboration with the German auditing rm TÜV SÜD. The results have been shared with our supplier and resulted in a corrective action plan from their side, through which we together, by heavily engaging on a regular basis, will further mitigate the risks. As a next step, we will engage with our external stakeholders to validate our ndings and deter- mine our most salient human rights issues, with the overarching goal to prioritize topics and formu- late a targeted action plan addressing the identied human rights risks. In 2025 Ebusco will start adding compliance checks in the auditing for key suppliers. We acknowledge this to be an ongoing process and will continuously work on improvements and rene- ment of our due diligence process. At Ebusco we have the following governance related policies in place. These policies are also available at our investor website. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 26 MANAGEMENT BOARD REPORT our business is dependent on public infrastructure, access to skilled labor and public administration. At Ebusco, tax follows the business instead of the other way around. CODE OF CONDUCT The Ebusco Code of Conduct guides employees, managers and directors in Ebusco, all wholly owned Ebusco businesses and all joint ventures under Ebusco’s control, on working in accordance with its core values and general business principles. It is a guideline to ensure integrity in Ebusco’s dealings and decisions. It gives direction on how to interact, serve customers and relate to signicant stakeholders. The rules of conduct cover legislation, fair compe- tition, accounting and nancial control, discrimina- tion and bullying, health and safety, quality assur- ance, environment, use of company assets and politics. It also sets out enforcement steps. SUPPLIER CODE OF CONDUCT Our Supplier Code of Conduct, published in 2023, denes how we request all our suppliers, by having them sign up to it before being onboarded, on ESG criteria, with reference to our Code of Conduct and Human Rights policy. DIVERSITY AND INCLUSION POLICY The Diversity and Inclusion Policy demonstrates how we promote diversity amongst our employees, and how we set targets for the composition of our Management and Supervisory Board. HUMAN RIGHTS POLICY Our rst Human Rights policy has been published in 2023, explaining how we screen our value and supply chain based on international standards and regulations with regards to topics such as child- labor, social working conditions and labor rights. WHISTLEBLOWER POLICY If an employee discovers an event or behaviour that is in conict with our Code of Conduct or any legal requirements, they have several options to report this. We encourage them to raise concerns. Internally, this can be done via their line manager, colleagues they trust or the company secretary. Employees can also use a special reporting website, www.ebusco.com/speak-up/, where they can log a report anonymously. The website also provides details for internal and external condential advisers. The whistleblowing facility and speak up policy were launched this year and communicated via a video from the CEO. No whistleblowing reports were received this year. Should Ebusco receive a report, the company secretary will establish a team to investigate, depending on the nature of the report. External assistance can be sourced if needed. The Supervisory Board has to be informed of any whis- tleblowing reports. INSIDER TRADING POLICY The insider trading policy guides employees in terms of the ownership of, and transactions in, Ebusco shares. It also requires Ebusco to keep a list of persons who, on a regular or incidental basis, may have insider information. The policy promotes compliance with the relevant obligations and restrictions under the applicable securities law and limits reputational risk that can harm Ebusco’s busi- ness integrity. TAX POLICY The Ebusco tax policy serves as a guideline for the conduct, responsibilities and transparent interac- tion with external parties such as tax and customs authorities and external tax consultants. We consider tax as a contribution to the community in which we operate and are aware that the success of ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 27 MANAGEMENT BOARD REPORT promptly reported to the rst line of IT support and management. Ebusco acts in accordance with the letter and spirit of the laws and regulations in terms of personal data protection. Cyber security in terms of our products, specically buses, is managed through a product life cycle management (PLM) system. The system connects our buses, chargers and energy containers. Buses, in turn, operate using different software options depending on the customer’s requirements. CYBER CERTIFICATION FOR EBUSCO BUSES We have started preparing for UN Regulation No R155 and R156, which requires all bus manufac- turers to have implemented a functioning Cyber Security Management System by July 2024. Based on this implementation, Ebusco obtains audited certication that will be a requirement to continue selling buses in the European Economic Community. As the certication will require that we provide proof that our third-party suppliers are also compliant, we will engage with our suppliers to ensure compli- ance throughout the supply chain. The regulation intends to ensure that our buses and their func- tions are protected from cyber threats to electrical or electronic components. In addition, Ebusco is ISO 21434:2021 Road vehicles — Cybersecurity engi- neering certied. COMPLIANCE IN OUR VALUE CHAIN We select suppliers on the basis of an internal quality control process that includes engineering validation, quality, cost, delivery and lead-time criteria. We maintain close relationships with our key suppliers, including those for LFP (Lithium iron phosphate) batteries, drivetrain components, charging systems, heating systems, bus body components, axles, brakes, air systems, compressors and systems for online monitoring of buses. According to Ebusco’s general terms and conditions, suppliers must operate in full compliance with appli- cable legislation and generally accepted interna- tional norms and regulations. This includes goods supplied in accordance with procedures that comply with the requirements of e.g. ISO 9001, ISO 14001 or ISO 45001. All products have to be supplied in accordance with all rules and regulations regarding safety, environmental and working conditions, such as REACH, RoHS and Conict Minerals regulations. We are currently working with a tooling solution to screen/execute ESG due diligence on our suppliers. All in accordance with ESG supply chain regula- tions such as the Norwegian Transparency Act, the German Supply Chain Act, and the European equiv- alent: Corporate Sustainability Due Diligence Direc- tive (CSDDD). A formal supplier audit plan, including site visits, has been developed in 2023. The priority-setting for these supplier audits is on a risk-based approach. In 2023, a rst human rights audit was conducted by an external auditor on our battery supplier in China. SUSTAINABILITY GOVERNANCE The Management Board is responsible for the sustainability strategy and implementation. Previ- ously, sustainability was managed as a separate function with a dedicated Sustainability Manager. From the end of the year, it was integrated under the responsibility of the Director QHSSE, ensuring environmental compliance, resource efciency, and corporate responsibility align with overall safety and regulatory goals. REGULATORY COMPLIANCE We are committed to full compliance with applicable regulations, both geographically and sector-wide. According to the EU Commission’s directorate on mobility and transport, the main objectives of Euro- pean public transport policy are to provide safe, ef- cient and high-quality passenger transport services through regulated competition. It considers social, environmental and regional development factors to guarantee transparency and performance. Ebusco’s zero emission buses are fully aligned with the EU objectives. We require all representatives of Ebusco to respect and comply with the national and international laws, regulations, and instructions of cities, states and countries where Ebusco is active. CYBER SECURITY Ebusco developed an information technology (IT) infrastructure that is robust, reliable and ensures safe data storage. The manufacturing, sales, procurement and planning for our products and services rely on data. We collect data in many ways, including through Ebusco Live and internal systems. Customer telematics and charging data are some of the key inputs into our operations and help us opti- mize after-sales service, inventory and more. ALERT AND AWARE According to the Ebusco Code of Conduct, all employees must handle information obtained by virtue of their function with care and maintain strict condentiality. We prohibit the processing of any information, whether condential or not, in a digital environment that is not managed by Ebusco. We also emphasize that portable devices such as laptops, tablets, smartphones and ash drives pose a security risk. Any information breaches have to be ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 28 MANAGEMENT BOARD REPORT THE EU TAXONOMY REGULATION The EU Taxonomy is set up to provide all stakeholders with appropriate denitions for which economic ac- tivities can be considered environmentally sustain- able. In this way, it should create security for inves- tors, protect private investors from greenwashing, help companies to become more climate-friendly, mitigate market fragmentation and help shift in- vestments where they are most needed. The EU Taxonomy Regulation has established six environmental objectives, and the EU has adopted delegated acts. 1. Climate change mitigation 2. Climate change adaptation 3. The sustainable use and protection of water and marine resources 4. The transition to a circular economy 5. Pollution prevention and control 6. The protection and restoration of biodiversity and ecosystems Under the requirements of the EU Taxonomy, com- panies currently in scope of Directive 2014/95/EU on the disclosure of non-financial information, need to disclose the proportion of Taxonomy-aligned and non-Taxonomy aligned economic activities in their total turnover (hereafter referred to as revenue), capital expenditures (Capex) and operating expens- es (Opex) including certain qualitative information. Ebusco does not meet (yet) the criteria of Directive 2014/95/EU on the disclosure of non-financial infor- mation during this reporting year 2024. For an economic activity to be classed as ‘environ- mentally friendly’ under the EU Taxonomy, it must first be determined whether it is ‘Taxonomy-eligible’ and then whether it is ‘Taxonomy-aligned’. Only ac- tivities that are described in the delegated act are ‘Taxonomy-eligible’. The second step is to conduct an analysis to establish if an activity is aligned. This alignment determines whether the eligible activities are sustainable (or not). To evaluate Ebusco’s eligible activities, the complete list of activities listed in the EU taxonomy Delegated Act related to climate change mitigation and climate change adaptation have been assessed and com- pared to Ebusco’s core activities. Hence, the below activities, and related numbering (i.e. ‘3.3’), relate to the Taxonomy classification model itself. ACTIVITY DESCRIPTION EBUSCO KPI 3.3 Manufacture of low-carbon technologies for transport Manufacture, repair, main- tenance, retrotting, repur- posing and upgrading of low carbon transport vehicles, rolling stock and vessels. Ebusco develops and produces fully electric city and regional buses (PRODCOM code 29.10.30) and contracts for ancil- lary services and goods, which support the customer’s use of zero-emission buses (aftersales). Revenue Opex Capex 3.6 Manufacture of other low carbon technologies Manufacture of technologies aimed at substantial GHG emission reductions in other sectors of the economy, where those technologies are not covered in Sections 3.1 to 3.5 of this Annex. Ebusco offers the installation of charging stations for clients which are manufactured to allow the operation of their zero-emission buses. Further- more, Ebusco’s Energy Storage Systems (ESS) for both land and marine use and charging products. Revenue Opex Capex 6.5 Transport by motorbikes, passenger cars and light commercial vehicles Purchase, nancing, renting, leasing and operation of vehi- cles designated as category M1, N1, both falling under the scope of Regulation (EC) No 715/2007 of the European Parliament and of the Council234, or L (2- and 3-wheel vehicles and quadri- cycles). Ebusco's company cars, owned or leased under IFRS 16 correspond with this category 6.5. Opex Capex 7.7 Acquisition and ownership of buildings Buying real estate and exer- cising ownership of that real estate. Ebusco's buildings, owned or leased under IFRS 16 corres- pond with this category 7.7 Opex Capex ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 29 MANAGEMENT BOARD REPORT The EU Taxonomy reporting is based on the financial figures of 2024. The Taxonomy-eligible KPIs have been calculated as: • Taxonomy-eligible revenue KPI = eligible revenue / total revenue • Taxonomy-eligible Capex KPI = eligible Capex / total Capex • Taxonomy-eligible Opex KPI = eligible Opex / total Opex The denominator for the eligibility KPIs has been de- fined as: • Total revenue as stated in Note 5 Revenue, cost of materials and segment reporting of the Annual Report. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 30 MANAGEMENT BOARD REPORT • Total Capex (additions) as stated in Note 11 Prop- erty, plant and equipment and Note 12 Intangible assets and note 21 Leases of the Annual Report. • Total Opex related to R&D, building renovation measures, short term lease, repair and mainte- nance and other direct expenditures relating to the day- to-day servicing of assets of property, plant and equipment. Ebusco allocated the revenue, capital expenditures and operational expenditures to the Taxonomy-eligi- ble activities (the nominator of the Taxonomy-eligi- bility KPIs). This allocation is based on the general ledger description of the financial system, which also forms the basis for Ebusco’s external financial reporting. The below table reflects the percentage of our revenue, capital expenditure and ope rational ex- penditures related to these eligible activities: (€ thousands) Revenue Capex Opex Scope of activity 10,665 4,722 3,894 of which: Eligible 100.0% 96.3% 100.0% Non Eligible 0.0% 3.7% 0.0% Aligned 0.0% 0.0% 0.0% Total 100.0% 100.0% 100.0% In 2024, we have focused on our EU Taxonomy-eligi- bility assessment again, and we have started to for- malize our EU Taxonomy-alignment processes such as the minimum safeguards. At this stage it is unclear how to define the best-performing alternative on the market, for Ebusco’s energy storage system and elec - trical vehicle chargers. More clarification of the tech- nical screening criteria of activity 3.6: ‘Manufacture of other low-carbon technologies’ and examples is preferably needed to assess the substantial contri- bution for these specific products. We have not yet formalized all our EU Taxonomy-alignment process - es such as the minimum safeguards and the Do No Significant Harm principles. Therefore, we concluded that we are not yet EU Taxonomy-aligned per 2024 but will further prepare ourselves for this in 2025. RISK MANAGEMENT AND INTERNAL CONTROL RISK MANAGEMENT GOVERNANCE In conducting our business, we face risks that may interfere with our business objectives. It is important to understand the nature, likelihood and potential im- pact of these risks. The company sees adequate risk management as an integral element of good business practice. The Management Board is responsible for the organisation, implementation and functioning of the internal risk management and control systems that are geared to Ebusco’s business activities. The Manage- ment Board is aware that risk management and control systems cannot provide an absolute guarantee with respect to achieving the business objectives and pre- venting signicant errors, losses, fraud or the violation of laws or regulations. The scope of the Supervisory Board’s supervision includes the design and operation of the internal risk management and control systems as well as the monitoring of the effectiveness of the internal control system. The Audit Committee supports the Supervisory Board in the performance of this super- vision. RISK PROFILE Ebusco’s approach to risk management is aimed at nding the right balance between maximizing the business opportunities while at the same time managing the risks involved. The most important risks have been identied and clustered into four categories: strategic risks, operational risks, nan- cial and reporting risks and compliance risks. The company is prepared to accept risks associated with doing business in the continuously changing market environment in a responsible and well-con- sidered way, as well as in line with the interests of its internal and external stakeholders. It is the duty of the Management Board to weigh the business opportunities against the expectations and interests of employees, shareholders, nancial institutions, supervisors and other strategic stake- holders. Decisions regarding changes or ne-tuning of our business models are taken by the Manage- ment Board in accordance with the risk appetite of the company. Considering strategic risks, a balance is explicitly sought between acceptable risk on the one hand and the entrepreneurship conducted in the context of long-term value creation on the other hand. Operational risks must be controlled as good as possible, and the company will review the effec- tiveness and efciency of its operational processes for this purpose. Next to this, nancial and reporting risks need to be controlled as well to avoid errors in our nancial reporting. Compliance with laws, regu- lations and our Code of Conduct is fundamental to Ebusco’s reputation which implies a zero approach; we do not accept any risk of violation. RISK MANAGEMENT SYSTEM Ebusco’s risk management policies have been deve- loped to identify and analyze the risks faced by the company, to set appropriate risk limits and controls, to monitor risks and adherence to limits and to assess the effectiveness of the internal controls. Ebusco furthermore regularly reassesses risk management protocols and frameworks to align with evolving market dynamics and operational endeavors. The internal control processes aim to identify and address risks in a timely and consistent way. Our risk manage - ment objective is that the risks we face are properly evaluated and mitigated, and that management is provided with the information necessary to make informed decisions in a timely manner. Ebusco’s risk management system consists of quality controls, management information systems, policies and an internal control framework. QUALITY CONTROLS The company has adopted an integrated, end-to-end approach to quality control, meaning that the company performs multiple quality inspections during both the production and the pre-delivery inspection (PDI) phase, and the company continuo- usly provides feedback of the outcome of quality checks to its development and engineering teams to increase quality in the design and production process. The company has strategies and a dedi- cated team using the FRACAS system (Failure Reporting, Analysis, and Corrective Action System) to identify and correct any defects at each stage of the design, supplier development, production, and eld performance of Ebusco’s zero emission buses. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 31 MANAGEMENT BOARD REPORT MANAGEMENT INFORMATION SYSTEMS The heart of our internal risk management and control system on our periodic performance is formed by our reporting cycle and management information systems. Our mid-term plan and objec- tives form the basis on which our yearly budget is made. POLICIES Ebusco has a Code of Conduct that has been deter- mined by the Management Board and approved by the Supervisory Board. The Code of Conduct applies to all Ebusco employees, including tempo- rary employees, and is published on the corporate website. In addition, Ebusco has a Whistleblower policy that has been published on the corporate website and ensures that possible violations of exis- ting policies and procedures can be reported without any negative consequences for the person reporting the violation. INTERNAL CONTROL FRAMEWORK The company acknowledges the need for an effective internal control framework (ICF). Ebusco established a blueprint for its ICF during previous years which was set for further enhancement and implementation. However, due to the continued operational and nan - cial challenges, the further design and implemen- tation of the ICF has not obtained the required level of attention and the company therefore believes the ICF operating effectiveness is still below par. Consi - dering the transition of Ebusco’s business model, the Company will assess the implications on the designed blueprint and further roll-out of its ICF. INTERNAL AUDIT Given the operational and nancial challenges, the internal auditor has not been assigned with an engagement during 2024. The company however engaged an external consultancy party to assess critical processes within the organization which were considered most important due to the referred to operational and nancial challenges. The company aims to reinstall the role of internal audit in 2025. RISK APPETITE Our risk appetite depends on the nature of the risk, the likelihood and the potential impact on our busi- ness. Ebusco’s risk appetite, the level of risk Ebusco is willing to accept to achieve its objectives, may vary based on specic risks and is divided into ve levels: very low, low, medium, high and very high. Our approach is geared toward mitigating the risks to the levels dened in our risk appetite. Ebusco’s risk appetite is visualized in the table below. The risk categories are not classied in order of importance. RISK OVERVIEW – OUR KEY RISKS The table on the next page is a summary of key risks that, alone or in combination with other events or circumstances, could have a material adverse effect on the Group’s business, nancial condition, results of operations or prospects. Although management believes that the risks and uncertainties described below are the most material risks, Ebusco may face other (unsurfaced) risks as well. All of these risk factors and events are contingencies which may or may not occur. The Group may face a number of these risks simultaneously and some risks may RISK APPETITE VERY LOW LOW MEDIUM HIGH VERY HIGH Behaviour towards risk Averse Prudent Balanced Considerable Seeking Strategic Operational Financial & reporting Compliance be interdependent. In making the selection, the Group has considered circumstances such as the probability of the risk materializing on the basis of the current state of affairs, the potential impact which the materialization of the risk could have on the Group’s business, nancial condition, results of operations or prospects, and the attention that management would, on the basis of current expec- tations, have to devote to these risks if they were to materialize. The key risk faced by the Group is its liquidity risk— the risk that the company is unable to meet its short-term nancial obligations as they fall due. For a comprehensive assessment of the Group’s liquidity risk, reference is made to its Going Concern disclosure in note 2.3 in its consolidated nancial statements. On 17 October 2024 a pre-judgment attachment was placed on some of Ebusco’s bank accounts by one of its customers. The Group and the customer reached an agreement on the matter on 24 October 2024 after which the customer lifted the pre-judgement attachment. Furthermore, the Group incurred late delivery penal- ties and order cancellations during 2024 as a result of the Group's failure to deliver the contracted buses within the required timeframe, giving the customers the right to terminate the contracts. These cancel- lations and penalties had a signicant negative impact on the Group’s nancial result and liquidity position. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 32 MANAGEMENT BOARD REPORT RISK AREA RISK RISK DESCRIPTION RISK TREND RISK APPETITE STRATEGIC Geopolitical environment Geopolitical and macroeconomical changes and disruptions could materially adverserly affect the Group's business, nancial conditions, results of operations or prospects. Industrial operations including supply chain Supply chain disruptions or shortages and other events that may affect the Group's supply chain may materially adversely affect the Group's business and protability. Competitive environment The Group faces strong competition in the transit bus market from both new and established competitors alike. If it were not able to compete successfully against them, the Group's revenue growth and market share could be materially adversely affected. Intellectual property Failure to adequately protect Ebusco’s intellectual property rights could affect the Group's business, nancial condition, result of opera- tions or prospects. Technological developments Failure to anticipate or adapt to technological disruptions could adversely affect our competitiveness and nancial performance. OPERATIONAL Late delivery and non-availability penalties and order cancellations Late deliveries of the Group's goods may result in penalties imposed by clients or partners, negatively affecting Ebusco’s nancial perfor- mance and reputation. Legal proceedings Legal proceedings and claims expose the Group to potential nancial and reputational risks. Quality control The Group faces inherent risks associated with potential product defect claims, which may involve allegations of inadequate safety measures, design aws, or manufacturing errors. The nancial implications of such claims could signicantly impact the Group's nan- cial performance and market standing. Cost ination and price increases The Group’s nancial performance could be negatively impacted if it is unable to compensate for higher costs through increased prices on products and services sold. Safety & Incidents The main safety risks in our operations involve high-voltage electricity, epoxy resin chemicals, work at heights, and hot surfaces. Interna- tional expansion may heighten our vulnerability in these areas. IT & Security The Group's systems are susceptible to breaches or damage from viruses, cyberattacks, natural disasters, or unauthorised access. Constantly evolving threats pose risks, potentially impacting product safety as digital integration expands. Breaches could lead to malfunctions, safety issues, and legal liabilities. Sensitive data associated with Ebusco's buses is also at risk, threatening condentiality and operational integrity. Incidents could disrupt operations, leak data, and damage our reputation, causing nancial losses. Staff T he Group's success depends on its ability to retain, attract and hire individuals for its Management Board and other highly skilled personnel. FINANCIAL AND REPORTING Liquidity risk Liquidity risk poses a signicant concern for the company, especially in the face of the nancial challenges that may impede the Group's ability to meet short-term obligations. Currencies Foreign exchange risk arises due to Ebusco’s exposure to foreign currencies. Credit risk The Group risks a nancial loss resulting from a counterparty failing to meet its contractual payment obligations. Reporting Risk that Ebusco's reporting contains material errors. COMPLIANCE Legal & regulatory Damage (including reputation) due to violation of legislation and regulations including export and sanctions regulations, unfair competi- tion, fraud, corruption and bribery. ESG The importance of environmental, social and governance (ESG) to our overall strategic and operational objectives is rapidly increasing. We may however be unable to achieve our ESG objectives, targets and market expectations. Tax Damage (including reputation) due to violation of tax legislations and regulations. Legend increased equal avoiding low medium ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 33 MANAGEMENT BOARD REPORT 1. STRATEGIC RISKS TURNAROUND PLAN RISK To address the Group’s operational challenges and improve its overall performance and delivery relia- bility, a comprehensive turnaround plan has been developed by the Management Board as announced on 24 October 2024. Under the Turnaround Plan, the Group will adopt an Original Equipment Design (OED) manufacturing model, being a model in which buses are designed and engineered by the Group, but assembled by contract manufacturers, instead of in-house by the Group. With the Turnaround Plan, the Group aims to address the core issues and chal- lenges that it has faced over the last few years resul- ting from (i) the unsuccessful in-house production and assembly strategy for the Ebusco 3.0 bus and (ii) the subsequent hybrid (contract manufacturing and in-house production) model approach that has not led to the anticipated outcome. The primary objective of the Turnaround Plan is to improve the overall performance of the Group and to restore and retain the condence of stakeholders in the Group as a reliable and valued business partner. While the Group is committed to implementing the Turnaround Plan, there is no assurance that the Turnaround Plan will be successfully implemented, or at all, or that it will be implemented as currently anticipated. If the implementation is not successful, this could affect the Group’s business, nancial condition, result of operations or prospects. RISK MITIGATION The Group has designed a governance structure, led by the CEO, COO (and Transformation Director) and CFO, to implement the elements of the Turnaround Plan in a structured and diligent fashion. To safe- guard company wide support for the Turnaround Plan, each workstream is owned and sponsored by a member of the Management, and reports to the CEO on a weekly basis. Each workstream has milestones, goals and targets and these will be tracked and traced on a regular basis, and these are subject to review by the Management Board. The COO is tasked with the day-to-day oversight of the Turnaround Plan. In order to successfully implement the Turnaround Plan, the Group is working to imple- ment the following actions: (i) the Group must esta- blish an experienced management team, clarify and improve working arrangements with contract manu- facturers and address the start-up inefciencies for Ebusco 3.0; (ii) the Group must only accept orders with realistic customization needs and perform capacity planning based on available production slots only, in order to improve its delivery reliability and timely output to customers; (iii) the Group must reduce inventory levels in planned future projects, create production ow and improve the Group’s cash position by attracting additional band guarantee facilities, and reduce the number of production faci- lities; and (iv) the Group must set up a dedicated team with full focus on the Energy Solutions opera- tions, to improve the delivery reliability of its MECs. GEOPOLITICAL ENVIRONMENT RISK Ebusco’s result of operations can be impacted by (geo)political instability, civil unrest and armed conicts. The changing geopolitical situation, poten- tial trade sanctions and/or decoupling economies may also give rise to further tariffs and other trade restrictions and barriers being imposed, which can negatively impact Ebusco’s production system and ability to conduct its operations. For instance, delays due to disruptions in the maritime transport as a result of Houthi-rebels blocking the Red Sea which require vessels to take an alternative route/detour which results in longer lead-times. Further, on 2 April 2025, extensive import tariffs were imposed by the USA on a broad range of countries, with counter-ta- riffs by some of these countries reasonably likely or already announced, as is the case for China. The factors described above, or other factors which may impact conditions relevant to Ebusco’s business environment, are difcult to predict and may have a material adverse impact on the Group’s business, nancial condition and operating results. RISK MITIGATION Ebusco, via its Management Board, monitors economic, political and general societal changes and, where necessary, develops response strategies to such events. The Management Board monitors these changes as they specically relate to the implementa - tion of the Turnaround Plan and equally, where neces- sary, develops response strategies to such events. INDUSTRIAL OPERATIONS INCLUDING SUPPLY CHAIN RISK Ebusco’s ability to deliver in accordance with market demand and product quality expectations depends signicantly on a timely and adequate supply of materials, components and other vital services. Disturbances in the supply chain and industrial system can arise from a variety of factors, including continued or additional shortages of material, single sourcing, supplier insolvency, shortages of (skilled) labor, strikes, pandemics, geopolitical tensions and conicts or climate hazards such as extreme weather, which each or in combination could result in stoppages and other interferences in production and deliveries, which may impair our ability to meet our customers’ orders, and thus negatively affect Ebusco’s business and results from operations. RISK MITIGATION Under the new production strategy as outlined in the Turnaround Plan, the involvement of contract manu- facturers in the procurement of components and overall planning of the supply chain increases; the Group intends to grow direct shipments of compo- nents to these contract manufacturers, thereby reducing the number of components supplied by Ebusco. This would simplify the Group’s supply chain. In addition, the Group, its contract manufac- turer and (the Group's) preferred supplier will engage in a three-party agreement for the key components to ensure both the required quality and the pricing of these components. COMPETITIVE ENVIRONMENT RISK Ebusco operates in a highly competitive market, and thus faces intense competition from global and local industry peers. Many of the Group's current and potential competitors are traditional automobile and bus suppliers with strong brand recognition, loyal customer bases, longer operating histories with established track records of service and greater nancial and marketing means. In addition, Ebus- co's competitors that also produce diesel-hybrid and compressed natural gas vehicles may have an advantage with existing and prospective customers that are interested in exploring diesel alternatives without committing to zero emission vehicles or that wish to pursue a gradual zero emission or electri- cation strategy with the same supplier. Ebusco also encounters competition from new market entrants, ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 34 MANAGEMENT BOARD REPORT RISK MITIGATION The Group has a combination of patents, trade- marks, and other forms of intellectual property rights. The Group’s IP is monitored. TECHNOLOGICAL DEVELOPMENTS RISK The electric vehicle industry is heavily dependent on advancements in battery technology. Rapid deve- lopments in battery chemistry, energy density, and charging infrastructure could lead to the emergence of new competitors or superior products, potentially eroding the Group’s market share. Failure to anti- cipate or adapt to these technological disruptions could adversely affect the Group’s competitiveness and nancial performance. RISK MITIGATION Ebusco maintains relationships with multiple tier-one battery suppliers to both reduce depen- dency on a single source and mitigate the risk of supply chain disruptions and to ensure its goods are up to date with latest technological develop- ments. In addition, the Group continuously moni- tors technological developments to stay abreast of the latest advancements and emerging trends in the industry, which enables Ebusco to anticipate if required. Finally, the Group entered in November 2024 into a strategic partnership with its longstan- ding battery supplier Gotion. Gotion is a leading tech- nology-based company, focused on power battery technology research, development and innovation. The Group aims to strengthen its position as an inno- vative frontrunner in the rapidly expanding market of electric buses and associated ecosystems. seeking to offer lower total cost ownership, new and/ or alternative technologies and/or new business models. In this market environment, there can be no assurance that new or current competitors will not be more successful than Ebusco in offering new products and services to the market, in implementing new technologies or collaboration models or in offe - ring more attractively priced products or services. This could affect the Group’s business, results of operations, market share and nancial position. RISK MITIGATION Throughout the last 12 years, Ebusco has worked to improve electric driving and make it economically attractive. The introduction of the Ebusco 3.0, with a lightweight carbon ber composite body based on aerospace technology, has been a gamechanger in this respect. Combined with its (cobalt free) battery technology, the Ebusco 3.0 is more cost efcient than other electric bus competitors, as well as diesel bus competitors. Ebusco is strongly committed to staying ahead of the curve. INTELLECTUAL PROPERTY RISK Ebusco primarily relies on a combination of trade secrets, contractual rights (such as non-dis- closure agreements and the assignment of certain employees/ consultants’ intellectual property rights) and intellectual property licenses to establish and protect its technology. The Group might be required to spend signicant resources to monitor, maintain and protect its intellectual property rights. Failure to adequately protect Ebusco’s intellectual property rights could result in its competitors offering similar products, potentially resulting in the loss of some of Ebusco’s competitive advantage, which could mate- rially adversely affect its business, nancial condi- tion, result of operations or prospects. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 35 MANAGEMENT BOARD REPORT 2. OPERATIONAL RISKS LATE DELIVERY AND NON-AVAILABILITY PE- NALTIES AND ORDER CANCELLATIONS RISK The timely delivery of goods is crucial for the success of Ebusco’s operations, and any delay in meeting delivery deadlines poses a signicant risk to the Group’s business. Late deliveries may result in penalties imposed by clients or partners, nega- tively affecting Ebusco’s nancial performance and reputation. These penalties could include contractual nes or the possibility of losing future business opportunities. In addition, under the Group's contracts with its customers, late delivery of buses entitles the relevant customer to cancel the order of buses and terminate the contract, even if these buses are in an advanced stage of production. Ebusco therefore may be exposed to order cancellations in each case where, under a customer contract, delivery has not been made by the contractually stipulated time. Order cancel- lations could affect the Group’s business, results of operations, nancial position and prospects. The Group received contract cancellations for 96 buses, the majority of which were at an advanced stage of production in the last quarter of 2024. which subsequently resulted in a working capital shortfall during the rst quarter of 2025. RISK MITIGATION Ebusco has reevaluated its production strategy with the objective of substantially increasing both manufacturing and assembly capacities. The anti- cipated outcome of this capacity enhancement is the restoration of the reliability of Ebusco’s delivery of goods, thereby avoiding any potential imposition of late delivery penalties and order cancellations. Concurrently, the Group diligently evaluates each claim on an individual basis and engages in ongoing discussions with its clients to amicably resolve any concerns without incurring immediate nancial repercussions. In addition, if the Group would receive contract cancellations it aims to reallocate these buses to new customers or existing contracts. LEGAL PROCEEDINGS RISK Ebusco could be confronted with various legal procee- dings and claims. The legal proceedings and claims could relate to a large number of topics, including product defects, intellectual property rights (espe - cially patent infringement lawsuits), supplier and other contractual relationships, warranty claims and employment-related disputes. Such legal procee - dings and claims expose Ebusco to potential nancial and reputational risks. The product defects-related claims may involve allegations of inadequate safety measures, design aws, or manufacturing errors. Intel - lectual property disputes, particularly patent infringe- ment lawsuits, could result in substantial damages and injunctions that may affect our ability to produce or sell certain products. Legal actions related to supplier and contractual relationships may arise from disputes over terms, delivery failures, or quality issues. Additionally, warranty claims may lead to nancial liabilities and impact customer satisfaction. Employment-related disputes pose risks to the company's workplace repu - tation. Lastly, environmental matters may result in compliance-related litigation and nancial penalties. RISK MITIGATION Ebusco is committed to diligently manage these legal challenges through proactive risk mitigation strategies, internal and external legal expertise, and adherence to ethical business practices to safe- guard our stakeholders' interests. QUALITY CONTROL RISK The Group faces inherent risks associated with potential product defect claims, which may involve allegations of inadequate safety measures, design aws, or manufacturing errors. Instances of product defects, whether due to insufcient safety features, inherent design weaknesses, or manufacturing inaccuracies, could lead to legal disputes, regula- tory scrutiny, and reputational damage. Allegations of inadequate safety measures may arise if products fail to meet industry standards or pose risks to consumer safety. Similarly, design aws could result in product malfunctions or failures, leading to customer dissatisfaction and potential liability. Manufacturing errors, such as defects in materials or assembly processes, may further exacerbate the risk of product defects and associated claims. The nancial implications of such claims, including legal expenses, settlements, and potential damage to brand reputation, could signicantly impact the Group's nancial performance and market standing. RISK MITIGATION The Group has established comprehensive quality assurance protocols throughout the product deve- lopment and manufacturing processes, in coopera- tion with its contract manufacturers. This includes thorough testing procedures, quality control check- points, and regular inspections to identify and rectify potential defects before products reach the market. In addition, the Group aims to foster a culture of continuous improvement and innovation to drive ongoing enhancements in product quality, safety, and reliability. COST INFLATION AND PRICE INCREASES RISK Inationary trends continued during 2024 which resulted in increased prices for raw materials and freight and higher labor costs. The ability to pass on such higher costs into price increases for products and services may be limited by prices already committed to customers in order books or by competitive pressure. The Group’s nancial perfor- mance could be negatively impacted if it is unable to compensate for the higher costs through increased prices on products and services sold. RISK MITIGATION Ebusco is continuously monitoring the develop- ment of purchase prices for goods and services required on the short, medium and long-term basis. As certain raw materials and components are purchased on the world market, Ebusco enters negotiations with both new and existing suppliers to mitigate the risk to the extent possible. Furthermore, as part of the Group’s Turnaround Plan, it aims to involve its contract manufacturers in the sourcing of its required components which supports in mitiga- ting the risk. SAFETY & INCIDENTS RISK In the Group’s operations, safety risks relate mainly to using high-voltage electricity, chemicals such as epoxy resin, working at heights and with hot surfaces. Increasingly specic expertise and training capacity are required in order to protect against this risk. RISK MITIGATION The Group’s approach to health and safety is set out in the Ebusco Code of Conduct. All employees ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 36 MANAGEMENT BOARD REPORT are jointly responsible for health, safety and the environment at the sites where they normally perform their work activities. This means being aware of their conduct and how it might impact other team members. Employees receive formal training and they are aware that they should suspend work in unsafe situations and report this to their super- visors, as set out in the health and safety manual and the internal reporting process. IT & SECURITY RISK Despite the measures that the Group has imple- mented, including those related to cybersecurity, our systems could be breached or damaged by computer viruses and systems attacks, natural or man-made incidents, disasters or unauthorized physical or elec- tronic access. Cybersecurity threats are constantly evolving. The Group remains potentially vulnerable to additional known or yet unknown threats, as in some instances, the Group, its customers, and its suppliers may be unaware of an incident or its magnitude and effects. The Group recognizes the inherent risk associated with cybersecurity threats that have the potential to impact product safety. As the Group’s products increasingly integrate digital technologies, any compromise of cybersecurity breaches poses a direct threat to the safety and functionality of the Group’s products. Unauthorized access or manipula- tion of product systems could lead to malfunctions, safety breaches, or the compromise of critical safety features. Such incidents not only jeopardize the well-being of end-users but also expose the Group to regulatory scrutiny, legal liabilities, and repu- tational damage. Furthermore, Ebusco is exposed to cybersecurity threats concerning the sensitive data associated with its buses. The potential for unauthorized access, data breaches, or cyber-at- tacks is a pertinent concern. Cybersecurity threats could compromise the condentiality, integrity, and availability of critical information, including opera- tional data, maintenance records, and proprietary technology. The Group also faces the risk that it exposes its customers to cybersecurity attacks through the systems it delivers to its customers, including in the form of malware or other types of attacks as described above, which could harm the Group’s customers. Furthermore, the level of remote working has increased within the Group’s organiza- tion, which increases the risks of cybersecurity inci- dents. Events or incidents caused by vulnerabilities in the Group’s operations or products could cause disruptions of operations, loss or leakage of data, reputational risk and nancial losses. RISK MITIGATION Ebusco has contracted a specialized external cyber security company which fulltime monitors the IT environment and reports and acts upon threats together with the Group’s IT department. Furthermore, according to the Code of Conduct, all employees must be careful in treating information they obtain by virtue of their function and maintain condentiality. The Group prohibits the processing of information, condential or otherwise, in a digital environment that is not managed by Ebusco. The Group has also provided formal employee trainings for which the focus topics contained attacks and scams, insider training and reporting, ransom- ware, classication and protection, malicious software and social networks. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 37 MANAGEMENT BOARD REPORT STAFF RISK Ebusco's success depends, in part, on its continuing ability to identify, hire, attract, train, develop and retain highly skilled personnel, which is currently at risk (mostly) due to the Group’s nancially distressed situation. (Key) Employees may leave due to the uncertainty about job and subsequent nan- cial security. This uncertainty may also lead to a low morale in the Group’s workforce, reduced producti- vity and increase illness rates. Departing employees could result in losing deep knowledge of systems, clients and processes. Furthermore, a tarnished reputation or negative media coverage can deter potential candidates, especially in competitive job markets. If the Group is not able to attract and retain employees, it is required to attract external employees. These risks, individually and in aggre- gate, may result negatively affect the Group’s busi- ness, results of operations and nancial position. RISK MITIGATION Ebusco has put in place a retention programme for key personnel to ensure the possession of valu- able knowledge about the Group’s processes and culture. In addition, Ebusco has talent management programs in place. By recognizing and rewarding (key) employees by offering competitive compensa- tion and benets, the Group can reduce the risk of losing key talent to competitors. 3. FINANCIAL AND REPORTING LIQUIDITY Liquidity risk is the risk that Ebusco will encounter difculty in meeting the obligations associated with its nancial liabilities that are settled by delivering cash or another nancial asset. Liquidity risk poses a signicant concern for Ebusco, For a comprehensive assessment of the Group’s liquidity risk, reference is made to its Going Concern disclosure in note 2.3 in its consolidated nancial statements. CURRENCIES RISK Foreign exchange risk arises due to Ebusco’s exposure to foreign currencies. This exposure results from the Group's involvement in foreign operations, such as the cooperation with the contract manufac- turers, or trade in foreign currency (buy and sell). RISK MITIGATION Ebusco has risk management policies and proce- dures in place for managing its foreign exchange risk. The Group is mainly exposed to the Chinese renminbi (RMB). Ebusco, whenever possible, manages its foreign currency risk by hedging trans- actions with suitable nancial instruments (predo- minantly currency forwards) that are expected to occur within a maximum 24-months period for hedges of forecasted purchases and sales. CREDIT RISK RISK Credit risk describes the risk of nancial loss resulting from a counterparty failing to meet its contractual payment obligations. Credit risk includes both the direct risk of default and the risk of a deterioration in credit - worthiness. If several larger customers fail to meet their undertakings, Ebusco could suffer signicant losses. RISK MITIGATION Ebusco performs credit assessments before it enters into contracts with customers. In addition, the most signicant part of the Group’s customer base are (semi)-governmental organizations which have a relatively low probability of default. REPORTING RISK Accurate reporting and disclosures provide internal and external stakeholders with signicant informa- tion for a better understanding of Ebusco’s business. Failures in reporting and/or disclosure notes, could create market uncertainty regarding the reliability of the information (including nancial data) presented and could have a negative impact on the price of Ebusco shares. In addition, the reliability of revenue and expenditure data is key for steering the business and for managing top-line and bottom-line growth. RISK MITIGATION In order to mitigate the risk of incomplete or inac- curate reporting, Ebusco has developed and imple- mented company-specic accounting guidelines, which set the standard for proper accounting. Key components of our guidelines are our accounting principles and checklist, which are both IFRS comp- liant. Finally, Ebusco’s annual nancial statements are audited by an external auditor. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 38 MANAGEMENT BOARD REPORT 4. COMPLIANCE LEGAL & REGULATORY RISK Non-compliance due to violation of legislation and regu- lations and internal guidelines can result in damage (including to reputation). Changes in regulations that apply to our business can increase compliance costs and the risk of non-compliance. In case of non-compliance, this could result in signicant penalties and reputational harm. Furthermore, additional regulations could impact or limit our ability to sell buses in specic jurisdictions. RISK MITIGATION The Group’s employed legal professionals provide ongoing advice, interpret complex regulations and help the company navigate through compliance challenges. Where necessary, the Group engages the services of external legal and compliance advisers to assist with this function. ESG RISK The importance of environmental, social and governance (ESG) to our overall strategic and operational objec - tives is rapidly increasing. We may, however, be unable to achieve our ESG objectives and targets, or unable to adapt, respond and comply timely with emerging ESG expectations, needs and regulations. Ebusco could be exposed to the risk of non-compliance with ESG reporting disclosure requirements. Failure to meet these require - ments could adversely affect Ebusco’s reputation and brand. Further, it could adversely impact Ebusco's nan - cial position or operating result through lost revenue as a result of losing tenders or due to the additional cost of any required remedial actions, penalties or claims. RISK MITIGATION Ebusco is currently embedding the ESG requirements into its governance structures, (reporting) processes, corporate policies and practices. The Group furthermore screens its supply on ESG criteria by conducting regular (supplier) audits. Next, internal and external assess - ments of its ESG performance are carried out to identify areas for improvement and ensure ongoing compliance with emerging ESG expectations and regulations. In addition, it actively engages with stakeholders, inclu - ding customers, employees, regulators, investors, public authorities and communities, to understand their expec - tations regarding ESG practices. TAX RISK Ebusco is exposed to tax risks which could result in double taxation, penalties and interest payments. The source of the risks could originate from local tax rules and regulations as well as international and EU regu - latory frameworks. These include but are not limited to transfer pricing risks on internal cross-border deliveries of goods and services, as well as tax risks relating to changes in the transfer pricing model. The risks may have a signicant impact on local nancial tax results, which, in turn, could adversely affect Ebusco’s nancial condition and operating results. RISK MITIGATION Ebusco’s tax advisors provide tax advice, ensures tax compliance, including accounting and reporting, to ensure adherence to tax policies. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 39 MANAGEMENT BOARD REPORT MANAGEMENT STATEMENT The Management Board is responsible for the design and effectiveness of the internal systems for risk management and control. The purpose of these sys- tems is to identify and effectively manage significant risks to which the compa- ny is exposed. However, they can never provide an absolute guarantee that the company will achieve its objectives and cannot entirely prevent major errors or losses, incidents, fraud or actions in breach of laws and regulations. Ebusco established a blueprint for its Internal Control Framework (ICF) during previous years which was set for further enhancement and implementation. Howe - ver, due to the continued operational and financial challenges, the further design and implementation of the ICF has not obtained the required level of attention and the company therefore believes the ICF operating effectiveness is still below par. The very challenging business circumstances that Ebusco has gone through in the last months, and those which Ebusco continues to face and the trans - formation the company is going through, including its refinancing and restructuring efforts, have placed significant demands on the time and resources of the company. As a result, the drafting of the 2024 financial sta - tements and consequently, the external auditor's audit process, have experienced delays, which pre - vented completion of the audit within the expected timeframe. Consequently, the financial statements included in this annual report as published today, are unaudited. The Management Board has assessed the strategic, operational, financial and reporting risks and com- pliance risks, as well as the design and effective- ness of the internal risk management and control systems as described in the section on ‘Risk Ma- nagement’. The effectiveness and functioning of the internal risk management and control systems have been discussed with the Audit Committee and the Supervisory Board. Taking into account the aforementioned risks and the measures designed to manage them, and in accordance with the best practice provision 1.4.3. of the Dutch Corporate Go- vernance Code, the Management Board declares that to the best of its knowledge: • the report provides sufficient insights in the ef- fectiveness of the internal risk management and control systems and into any failings thereof, as further disclosed in the Risk Management and In - ternal Control section; • despite the concerns in the aforementioned sys - tems, the figures in this report have been prepared with the utmost care, but can be subject to change; • the financial reporting is prepared on a going con - cern basis; and • the section on risk management in the report, when read in conjunction with note 2.3 of the Fi - nancials Statements, state those material uncer- tainties and risks that are relevant to the expecta- tion of the company’s continuity for the period of twelve months after the preparation of the report. With reference to Section 5:25c paragraph 2, sub c of the Financial Markets Supervision Act (Wet op het financieel toezicht), the Management Board declares that to the best of its knowledge: • The financial statements provide a fair view of the assets, liabilities, financial position and profit or loss of Ebusco and of the companies included in the con - solidation taken as a whole. • The Management Board Report provides a fair view of the situation on 31 December 2024 and of the de - velopments during 2024 of Ebusco and of its affilia- ted companies whose information have been inclu- ded in the consolidated financial statements; • and that the Management Board Report describes the material risks and uncertainties that Ebusco faces. Deurne, the Netherlands, 30 April 2025 Management Board ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTSGOVERNANCE 40 MANAGEMENT BOARD REPORT C. Schreyer, Chief Executive Ofcer M. Van Maanen, Chief Operations Ofcer P. Bijvelds, Founder and member of the Management Board GOVERNANCE Corporate governance 42 Composition of the Supervisory Board 48 Report of the Supervisory Board 49 Remuneration report 54 CONTENT ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 41 MANAGEMENT BOARD REPORT GOVERNANCE ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 42 MANAGEMENT BOARD REPORT GOVERNANCE INTRODUCTION Ebusco is a public limited liability company (naamloze vennootschap) under the laws of the Netherlands. The company is domiciled in the Netherlands and has its registered seat in Deurne, the Netherlands. Ebusco is listed on the Euronext Amsterdam, ticker EBUS:AS. It has a two-tier board structure, with a Management Board and a Supervisory Board. The company’s highest authority is the General Meeting of Shareholders, which is convened at least once a year. As a responsible corporate citizen, Ebusco acknowl- edges the importance of good corporate governance and open and transparent communications with all its stakeholders. CAPITAL STRUCTURE Following the approval of the General Meeting on 24 October 2024, the authorized share capital of the Company has been amended from €2,200,000, divided into 220,000,000 Ordinary Shares with a nominal value of €0.01 each, to €3,400,000, divided into 68,000,000 Ordinary Shares 1 with a nominal value of €0.05 each. As a result of the Share Consolidation, the number of shares outstanding at that date was adjusted from 73,088,382 before the Share Consolidation to 14,617,677 following the Share Consolidation. On 20 November 2024 a capital increase via a rights issue took place, consisting of 43,853,031 new ordinary shares. Furthermore 7.0 million shares were issued to CVI Investments, Inc., on 25 November 2024 under the restructuring of the repayment terms of the convertible bond issues in December 2023. As a result, the compa- ny's issued share capital increased and amounted to €640,393.80 consisting of 65,470,708 ordinary shares on 31 December 2024 with a nominal value of €0,05 each. Moreover, on 18 November 2024, the company executed an investment agreement with Gotion in which it committed to subscribe for any rump shares in the aforementioned rights issue for an amount of EUR 5 million, which would represent a shareholding in the Company of approximately 9.3% at the Settle- ment Date of the Rights Issue in the event Gotion would be allocated all of its rump shares. In the event Gotion would subscribe for any rump shares, the proceeds would be used by Ebusco to set-off an outstanding accounts payable position it has with Gotion. To this effect, the company called an Extraor- dinary General Meeting of Shareholders on 26 March 2025 to ask for approval for a separate share issu- ance to Gotion, which approval was granted. Under the investment agreement, the company and Gotion agreed that Gotion is granted the right to nominate a representative in both Ebusco’s Supervisory Board and Management Board. The Extraordinary General Meeting resolved the appointments Mr. Chen Li as member of the Supervisory Board and Mr. Duan Wei as member of the Management Board as per the conversion of the accounts payable by Gotion. At the date of this report, the conversion has not yet taken place. Each ordinary share carries one vote. A shareholder may cast their vote in person, by proxy or at the General Meeting of Shareholders. Ebusco has not issued any shares to which special rights of control are attached and there are no restrictions on the voting rights attached to the shares in Ebusco. All ordinary shares have equal entitlement to the prots and general reserves attributable to the shareholders. Ebusco does not cooperate with the issuance of depository receipts for its shares, nor does the company apply any restrictions on the transfer of its shares. The company is to the best of its knowledge not aware of any agreement between shareholders of the company which could result in a possible restriction on the transfer of shares or voting rights. All resolutions of the General Meeting of Share- holders are passed with an absolute majority of the votes cast, unless a larger majority is required by law or pursuant to the company’s Articles of Association. The Articles of Association of the company do not include specic provisions with respect to so-called protection measures in case of a take-over bid. The company has not entered into agreements pursuant to which a change of control would have an effect. All operational agreements have been concluded by a participating company, in most cases Ebusco B.V. The shareholders of the company prior to IPO, each having an interest of 10% or more, entered into a cooperation agreement. Pursuant to this agreement, every single shareholder having at least 10% of the outstanding shares is entitled to nominate a candi - CORPORATE GOVERNANCE date for the Supervisory Board which agreement is still valid.] The management service agreements between Ebusco Holding N.V. and each of the members of the Board do not provide for a payment, either in cash or otherwise, in the event of the conclusion of an offer on all or part of the shares in the company or a subsidiary. ISSUANCE OR ACQUISITION OF SHARES The company is entitled to acquire its own fully paid-up shares with due observance of the relevant legal and statutory provisions. Acquisition of own shares is only permitted if the General Meeting of Shareholders has authorized the Management Board to do so. Such authorization will be valid for a period not exceeding 18 months. This authorization was provided during the General Meeting of Shareholders in May 2024. In the resolution the General Meeting of Shareholders must determine the number of shares that the Management Board may acquire for valuable consideration, the manner in which they may be acquired, and the limits within which the price must be set. In addition, the approval of the Supervisory Board is required for any such acquisi - tion. Furthermore, during the EGM on 26 March 2025, the Management Board received authorization to issue up to 16 million new shares and exclude pre-emptive rights for 18 months until 26 September 2026. The company may, without authorization by the General Meeting of Shareholders, acquire its own shares for the purpose of transferring such shares to employees of the company or of a group company under a scheme applicable to such employees. 1 During the EGM of March 26, 2025, the authorized capital of the company was increased to EUR 16,367,500, divided over 327,350,000 shares with a nominal value of EUR 0.05 each. SHAREHOLDERS’ MEETINGS General Meetings of Shareholders are convened by the Management Board and the Supervisory Board. A legal term of at least 42 calendar days applies between the convocation date and the actual date of the meeting. A meeting must be convened by posting the notice and relevant materials required for consideration and decisions by the shareholders on the company’s website. At least one General Meeting of Shareholders is to be held within six months following the close of the nancial year of the company. In 2024, the General Meeting of Shareholders took place on 14 May. In 2025, the General Meeting of Shareholders is sched- uled for 16 June. Other General Meetings of Shareholders will be held whenever and as often as the Management Board or the Supervisory Board deems necessary. On 29 January 2024 an EGM took place to authorize the Management Board to issue shares, to grant rights to subscribe for shares and to limit or exclude pre-emptive rights, in relation to the senior convert- ible notes that were issued in December 2023. On 24 October 2024 an EGM took place to appoint Mr. Schreyer and to approve the share consolidation and to authorize the Management Board to issue shares under the Rights Issue. On 26 March 2025 and EGM took place to appoint both Mr. van Maanen and provisionally Mr. Wei as member of the Management Board, to provisionally appoint Mr. Li as member of the Supervisory Board and to authorize the Manage- ment Board to issue up to 16 million new shares and exclude pre-emptive rights for 18 months until 26 September 2026. Furthermore, amendments to the Articles of Association were approved so that the authorized share capital has been set at the statu- tory maximum of ve times the issued share capital as of the EGM convocation date. General Meetings of Shareholders will also be held if the Management Board or Supervisory Board is requested to that effect in writing by one or more shareholders individually or jointly representing one-tenth or more of the company’s issued capital, specifying in detail the subjects to be discussed, unless such a request is unreasonable. If neither the Management Board nor the Supervisory Board have taken the necessary steps to ensure that a General Meeting can be held within eight (8) weeks of receiving such a request, the requesting shareholder(s) may seek authorization from a judge of the court to convene a General Meeting. Each shareholder, either in person or by written proxy, is entitled to attend, speak and vote at a General Meeting of Shareholders. Those shareholders who individually or jointly represent at least three percent (3%) of the company’s issued share capital may request items to be added to the agenda of the General Meeting of Shareholders. Such a request is granted if it is received in writing at least 60 days before the meeting, stating the reasons for said request. Each share carries one vote. The company cannot vote on shares that it holds in its own capital. The Management Board and Supervisory Board must ensure that the General Meeting of Shareholders is adequately provided with all information required for a shareholder to decide and vote on the subject matter presented. The draft minutes of the (Extraordinary) General Meeting of Shareholders must be published on the company’s website within three months of the date of the meeting. Shareholders are invited to submit comments to the draft minutes within this three- month period. After this period the Chairman and Secretary of the General Meeting of Shareholders will formally adopt and subsequently sign the minutes, taking into consideration any comments received. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 43 MANAGEMENT BOARD REPORT GOVERNANCE MANAGEMENT BOARD RESPONSIBILITIES AND REPORTING LINE The Management Board is the executive body entrusted with the management of the company and responsible for ensuring its continuity under the supervision of the Supervisory Board. The Manage- ment Board's responsibilities include setting the company's management agenda, developing a view on long-term value creation, enhancing the performance of the company, developing a strategy, identifying, analyzing, and managing the risks asso- ciated with the company's strategy and activities, and establishing and implementing internal proce- dures which safeguard that all relevant information is made known to the Management Board and the Supervisory Board in a timely manner. In fullling their responsibilities, the members of the Management Board must act in the interest of the company and pay specic attention to the rele- vant interests of the company's employees, share- holders, lenders, customers, suppliers, and other stakeholders. The Management Board reports to the Supervisory Board and the General Meeting of Shareholders. COMPOSITION, DIVISION OF DUTIES AND REMUNERATION The number of members of the Management Board is determined by the Supervisory Board in consulta- tion with the Management Board. The members of the Management Board are appointed by the General Meeting of Shareholders. The Supervi - sory Board will nominate one or more candidates for a vacant position for the approval of the General Meeting of Shareholders. In turn, the General Meeting of Share - holders may resolve to appoint someone other than the person(s) nominated by the Supervisory Board, provided an absolute majority of the votes cast repre - senting at least one-third of the outstanding capital. If a proposal to appoint a person not nominated by the Supervisory Board is supported by an absolute majority of the votes cast, but this majority does not represent at least one-third of the outstanding capital of the company, a new meeting can be convened in which the resolution can be adopted by an abso - lute majority of the votes cast, irrespective of the percentage of the company’s issued capital present or represented at that meeting. Any new member of the Management Board is appointed for a maximum period of four years per term. Members of the Management Board may be reappointed for a term of no more than four years at a time, which reappointment should be arranged in a timely fashion. The company's diversity policy, as drawn up by the Supervisory Board, will be considered in the event of an appointment or reappointment. During 2024, Ebusco had an Executive Team, which consisted of the Management Board and an Executive Committee. At the end of 2024, within the Management Board, no seats were taken by women and three seats by men. At the end of 2024, the Executive Committee had 3 seats, one seat was taken by a woman, two seats by a man. As part of the Turnaround plan, in order to achieve a leaner organization, the company decided to dissolve the Executive Committee. Therefore, as of 1 January 2025, the company will be managed directly by the Management Board. When setting the gender balance target for the Management Board, the technology environment Ebusco operates in, with a thinly populated engi - neering talent pool, making it challenging to recruit female talent is taken into consideration. Nonethe - less, the Supervisory Board set a gender balance target for the Management Board to have at least one-third female in 2026. For 2024, the Management Board set a gender balance target for the Executive Committee to have at least one-third female and one-third male. Given the composition of the Executive Committee this target was met in 2024. With the elimination of the Executive Team as announced on 18 December 2024, the broader management layer is dened as the direct reports of the Management Board. This leadership team consists of 14 people, three of whom are women. When directors are replaced, active efforts are made to improve the gender distri- bution with the goal to have at least one-third female and one-third male. The Articles of Association of the company stipulate that a member of the Management Board may be suspended or dismissed by the General Meeting of Shareholders. A resolution of the General Meeting of Shareholders to suspend or remove a member of the Management Board other than pursuant to a proposal by the Supervisory Board requires an absolute majority of the votes cast representing at least one-third of the company's issued capital. If a resolution as referred to in the previous sentence is supported by an absolute majority of the votes cast, but this majority does not represent at least one-third of the company's issued capital, a new meeting can be convened in which the resolution can be adopted by an absolute majority of the votes cast, irrespective of the percentage of the Company's issued capital represented at the meeting. A member of the Management Board may be suspended by the Supervisory Board. A suspension by the Supervisory Board may be reversed by the General Meeting of Shareholders. The Management Board is collectively responsible for all actions of each individual member of the Manage - ment Board. The division of duties within the Manage- ment Board as well as the Management Board’s oper- ating procedures are set out in the company’s Articles of Association and the Management Board By-laws. The Articles of Association and the Management Board Bylaws are published on the company’s website. The Management Board comprised of the following individuals in 2024: Name Position Nationality Gender End of Term C. Schreyer CEO German Male 2028 AGM J. Jongma CFO Dutch Male 2027 AGM R. Dogge COO Dutch Male 2028 AGM P. Bijvelds Founder Dutch Male 2025 AGM * Mr Schreyer joined the company as CEO of Ebusco as of September 2024 and was ofcially appointed as Management Board member at the 24 October 2024 EGM ** Mr. Jongma stepped down as CFO of Ebusco as per November 2024. As of 25 November, Jan Piet Valk has taken on the role of interim CFO. He is not a member of the Management Board. *** Mr. Dogge stepped down as COO as per 31 December 2024. Michel van Maanen was appointed as his successor at the 26 March 2025 EGM. The Remuneration Policy and based thereon, the remuneration and terms and conditions of the members of the Management Board have been established by the General Meeting of Shareholders prior to the company being listed. Since the date of the initial public offering, the Supervisory Board has reviewed the remuneration and other terms and conditions for each member of the Managing Board. Any remuneration or amendment there to as estab- lished by the Supervisory Board will be in compli- ance with the company’s Remuneration Policy. Any amendment thereto will require a resolution of the General Meeting of Shareholders by an absolute majority of the votes cast. At least every four (4) years, the Remuneration Policy will be submitted to the General Meeting of Shareholders for approval. SUPERVISORY BOARD RESPONSIBILITIES AND REPORTING LINE The Supervisory Board supervises the Management Board's management of the company, the compa - ny's general course of affairs, and its afliated busi- ness. The Supervisory Board is accountable for these matters to the General Meeting of Shareholders. The Supervisory Board also provides advice to the Manage - ment Board. In performing their duties, the members of the Supervisory Board are required to focus on the effectiveness of the company's internal risk manage - ment and control systems as well as the integrity and quality of the company's nancial reporting. In the fullment of their duties, the members of the Super - ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 44 MANAGEMENT BOARD REPORT GOVERNANCE visory Board must act in the interest of the company and pay specic attention to the relevant interests of the company's employees, shareholders, lenders, customers, suppliers, and other stakeholders. The Supervisory Board monitors the internal control structure and procedures and the assessment of the risks faced by the company and its subsidiaries. The company acknowledges the need for an effective internal control framework (ICF). However, due to the continued operational and nancial challenges, the further design and implementation of the ICF has not obtained the required level of attention in the past years and the company therefore believes the ICF operating effectiveness is still below par. Ebusco however established a blueprint for its ICF which the company reassesses and will implement in 2025. In accordance with the Supervisory Board By-laws, the Supervisory Board is responsible for deci- sion-making in dealing with transactions (1) that constitute an existing or potential conicts of interest between an individual member of the Management Board, or an individual member of the Supervisory Board on one hand, and the company on the other hand, or (2) which are between the company and a shareholder having at least one percent (1%) of the outstanding issued capital. Both types of trans- actions are qualied as related party transactions pursuant to the provisions of the Dutch Financial Supervision Act (Wet op het nancieel toezicht) and EU-IFRS. Said regulations also state the requirement of market conformity of these transactions. In the course of the 2024 nancial year ve related party transactions occurred. One relates to the normal course of business. The Group engaged in trans- actions with ING Bank N.V., including loan facilities and issuance of letters of credit. All transactions are carried out at arms-length. The Supervisory Board reports to the General Meeting of Shareholders. COMPOSITION, DIVISION OF DUTIES AND REMUNERATION In accordance with the Company’s Articles of Asso- ciation, the Supervisory Board consists of at least three natural persons who are appointed by the General Meeting of Shareholders. The actual number of members is established by the Supervisory Board. On 26 October 2021, when Ebusco became a public limited liability company, the Supervisory Board comprised ve members. In 2024, the Supervisory Board started with six members and ended with four members, as Ruud Spoor resigned from the Supervi - sory Board for health reasons and Saskia Schatteman resigned from the Supervisory Board for personal reasons, both on August 30 2024. In 2025, the Supervisory Board consists of three members after Jeroen Drost resigned from the Supervisory Board as announced on 7 February 2025. The Supervisory Board is composed in such a way that its members can operate independently and be critical of each other, the Management Board, and any interest group. A pre-IPO shareholder holding at least ten percent (10%) of the outstanding issued capital has the right to nominate a candidate for the Super - visory Board. Any nomination should in itself qualify, taking into consideration the composition of the Supervisory Board and its committees, the compa - ny’s diversity policy, the prole for a specic position within the Supervisory Board, and any other criteria deemed relevant by the Supervisory Board at any time. In the beginning of 2024, the Supervisory Board comprised of six members, three members of the Supervisory Board were nominated by a respective shareholder authorized to nominate a candidate for appointment by the General Meeting of Shareholders. These three members are considered dependent within the meaning of the Dutch Corporate Governance Code. Three members of the Supervisory Board are qualied as independent within the meaning of best practice provi - sion 2.1.8. of the Dutch Corporate Governance Code. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 45 MANAGEMENT BOARD REPORT GOVERNANCE Within the current composition of the Supervisory Board, comprising of three members, two members are independent (Carin Gorter and Derk Haank) and one is dependent (Roelf de Boer) . The members of the Supervisory Board are appointed by the General Meeting of Shareholders. The Super- visory Board nominates one or more candidates for each vacant position. Each nomination for appoint - ment or proposal for reappointment of a member must be supported on sufcient grounds, and in the event of a reappointment the performance and operation of the member up for reappointment must also be taken into consideration. The Articles of Association and Supervisory Board By-laws stipulate that a member can be appointed for a term not exceeding four years and reappointed once for a similar term. After this period a member can be reappointed once more, albeit for a term not exceeding two years, as well as for one subsequent term not exceeding two years. A resolution of the General Meeting of Shareholders to appoint a Supervisory Board member other than in accordance with a nomination by the Supervisory Board requires a majority of the votes cast repre- senting at least one-third of the company's issued capital. If a proposal to appoint a person not nomi- nated by the Supervisory Board is supported by an absolute majority of the votes cast, but this majority does not represent at least one-third of the compa- ny's issued capital, a new meeting can be convened in which the resolution can be adopted by an abso- lute majority of the votes cast, irrespective of the percentage of the company's issued capital repre- sented at the meeting . Supervisory Board members may be suspended or removed by the General Meeting of Shareholders at any time. A resolution of the General Meeting of Shareholders to suspend or remove a Supervisory Board member other than pursuant to a proposal by the Supervisory Board requires an absolute majority of the votes cast representing at least one-third of the company's issued capital. If a resolution as referred to in the previous sentence is supported by an absolute majority of the votes cast, but this majority does not represent at least one-third of the company's issued capital, a new meeting can be convened in which the resolution can be adopted by an absolute majority of the votes cast, irrespective of the percentage of the company's issued capital represented. Any suspen - sion may be extended one or more times but may not last longer than three months in the aggregate. If at the end of that period, no decision has been taken on termination of the suspension or on removal, the suspension is lifted. The Supervisory Board members will retire their membership in accordance with a rotation plan drawn up by the Supervisory Board. In 2024 the Supervisory Board comprised the following individuals: Name Position Nationality Gender End of Term Derk Haank Chair Dutch Male 2025 AGM Jeroen Drost Vice-chair/ Nomination Committee chair Dutch Male 2028 AGM Carin Gorter Member/Audit Committee chair Dutch Female 2028 AGM Ruud Spoor Member Dutch Male 2025 AGM Roelf de Boer Member/ Remuneration Committee chair Dutch Male 2025 AGM Saskia Schat - teman Member Belgium female 2027 AGM * as per 7 February 2025, Jeroen Drost stepped down from the Supervisory Board ** as per 30 August both Ruud Spoor and Saskia Schatteman stepped down from the Supervisory Board. The members of the Supervisory Board are remuner- ated in accordance with the Remuneration Policy. The Remuneration Policy is published on the compa- ny’s website. SUPERVISORY BOARD COMMITTEES The Supervisory Board has established three committees, being • the Audit Committee; • the Nomination Committee; and • the Remuneration Committee. THE AUDIT COMMITTEE The function of the Audit Committee is to assist in the decision-making of the Supervisory Board. Ac- cording to its charter, the Audit Committee under- takes preparatory work for the Supervisory Board's decision-making regarding the supervision of the in- tegrity and quality of the company's financial repor- ting and the effectiveness of the Company's internal risk management and control systems. The Audit Committee is specifically responsible for: a monitoring the financial reporting process and drafting proposals to safeguard the integrity of the process; b monitoring the effectiveness of the internal con- trol system, the internal audit system (if applica- ble), and the risk management system in relation to the company’s financial reporting; c monitoring the statutory audit of the financial sta- tements; d reviewing and monitoring the independence of the external auditor or audit firm, in particular, the provision of additional services to the company; e adopting a procedure for the selection of the ex- ternal auditor and the nomination for appointment of the external auditor with respect to the statuto- ry audit of the financial statements; f performing preparatory work for the Supervisory Board's decision-making regarding the supervision of the integrity and quality of the company's financi - al reporting and the effectiveness of the company's internal risk management and control systems; g establishing the independence of the external auditor; h and monitoring cashflow development and treasury. THE NOMINATION COMMITTEE The purpose of this committee is to assist in the de- cision-making of the Supervisory Board. According to its charter, the Nomination Committee underta- kes preparatory work for the Supervisory Board's de- cision-making regarding the selection and appoint- ment of members of the Management Board and Supervisory Board. The Nomination Committee is specifically responsi- ble for: a drafting selection criteria and appointment proce- dures for members of the Management Board and Supervisory Board; b assessing at least once a year the size and com- position of the Management Board and Superviso- ry Board; c making proposals for the Supervisory Board profile; d assessing at least once a year the functioning of each individual member of the Management Board and Supervisory Board, and reporting their findings to the Supervisory Board; e drafting a plan for the succession of members of the Management Board and Supervisory Board ai- med at retaining a balance in the requisite exper- tise, experience, and diversity; f making proposals for the appointment (and reap- pointment) of members of the Management Board and Supervisory Board; g supervising the policy of the Management Board on the selection criteria and appointment proce- dures for senior management; h and performing preparatory work for the Super- visory Board's decision-making regarding (i) the acceptance by a member of the Management Board of membership to the Supervisory Board or to the position of non-executive director of a listed company and (ii) with regard to any conflict of interest that may arise from Supervisory Board members accepting ancillary positions. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 46 MANAGEMENT BOARD REPORT GOVERNANCE THE REMUNERATION COMMITTEE The purpose of this committee is to assist in the decision-making of the Supervisory Board. Accor- ding to the Remuneration Committee’s charter, the Remuneration Committee undertakes preparatory work for the Supervisory Board's decision-making regarding the remuneration policy. The Remuneration Committee is specifically respon- sible for: a submitting a clear and understandable proposal to the Supervisory Board for the remuneration po- licy to be pursued for the members of the Manage- ment Board; b making proposals concerning the remuneration of the individual members of the Management Board in accordance with the remuneration policy; c preparing the company’s remuneration report, and d making proposals to the Supervisory Board for the remuneration of the individual members of the Su- pervisory Board. CORPORATE GOVERNANCE With respect to the 2024 financial year, Ebusco is reporting on compliance with the Governance Code. Ebusco fully endorses the core principles of the Go- vernance Code and is committed to fully complying with the Governance Code’s best practice provisions where possible within the organization. However, in consideration of the company’s own interests and the interests of its stakeholders, we deviate from a limited number of best practice provisions, as speci- fied and explained below. The Policy is aimed not only at achieving a balance in terms of gender but also in a more general sense in terms of skills, experience, background, nationality, age, ethnicity, sexual orientation, religious beliefs, physical ability, and other characteristics. EXTERNAL AUDITOR At the AGM 2023, the General Meeting appointed Ernst & Young Accountants LLP as the company's external auditor for the nancial years 2024 – 2026. EY Accoun - tants B.V. replaced Ernst & Young Accountants LLP as the company's external auditor as from 29 June 2024. The external auditor may be questioned by share - holders and people representing a shareholder at the General Meeting of Shareholders on matters regarding its independent auditor’s report. The external auditor is therefore obliged to attend, and allowed to address, the General Meeting of Shareholders. CORPORATE GOVERNANCE STATEMENT The Governance Code requires companies to publish a statement concerning their approach to corporate governance and compliance with the Dutch Corporate Governance Code. This is referred to in Article 2a of the Decree on additional requirements for Board reports (‘Besluit inhoud bestuursverslag’). The information required to be included in this Corporate Governance Statement as described in articles 3, 3a, 3b and 3d of the Decree can be found in this annual report under the Corporate Governance and Shareholder Informa - tion chapters. DIVERSITY AND INCLUSION POLICY Ebusco has a Diversity and Inclusion Policy (D&I Policy) in place, the purpose of which is to ensure that the composition of the Supervisory Board and Management Board is diverse within the meaning of the policy. With respect to the Supervisory Board, the Act on a more balanced ratio of men and women on Manage- ment and Supervisory Boards’ (Wet evenwichtige verhouding man/vrouw in het bestuur en de raad ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 47 MANAGEMENT BOARD REPORT GOVERNANCE Deurne, the Netherlands, 30 April 2025 C. Schreyer, Chief Executive Ofcer M. van Maanen, Chief Operations Ofcer P. Bijvelds, Founder and member of the Management Board Best practice provision Non Compliance Measures to address non-compliance 2.1.5 Policy on Diversity and Inclusion (D&I) At the beginning of scal year 2024 the Super- visory Board was in compliance with the Act on a more balanced ratio of men and women on Management and Supervisory Board with two women and four men. However, with the stepping down of Saskia Schatteman and Ruud Spoor per 30 August 2024, the composition per year-end was not in compliance with only one women and three men. The provisional appointment of Mr. Chen Li as per the 26 March 2025 EGM will not improve the gender balance. However, the Supervisory Board is of the opinion that exceptional circumstances apply here, since the relationship with Gotion – including the right to nominate a Supervisory Board member of its choosing – is strategically of critical importance to Ebusco.For future nominations to the Supervisory Board, the nomi- nation committee shall take the Act on a more balanced ratio of men and women into account. 2.1.7ii: majority of Supervisory Board is independent The composition of the Supervisory Board is not in compliance with best practice provision 2.1.7. (ii) which requires that more than half of the Supervisory Board members are independent as dened in the Governance Code. Under the Exis- ting Relationship Agreement, each of the current Shareholders holding ten percent (10%) or more in the total outstanding issued capital has the right to nominate a candidate for the Supervisory Board. In addition, an investment agreement has been in place with Gotion since 17 November 2024, giving Gotion a nomination right for one Supervisory Board seat. During 2024 50% of the Supervisory Board was not independent within the context of the Governance Code. The nomination right of a shareholder having at least 10% of the outstanding capital will cease once the shareholder’s interest falls below that threshold. This is, however, outside the compa- ny’s control. 2.3.4: Composition of the committees. More than half of the members of the committees should be independent within the meaning of best prac- tice provision 2.1.8 In 2024 and on the date of this report the composition of the committees was not in comp- liance with best practice provision 2.3.4. van commissarissen), stipulates that any vacancy should be lled by a member of the sex not already equally represented. The D&I Policy for the Leadership Team (subtop) and other employees is still under development. The purpose of this Policy is to achieve that the compo- sition of the employees of the company as a whole is as diverse as possible, taking into consideration a variety of non-discriminatory factors. COMPOSITION OF THE SUPERVISORY BOARD IN 2024 CHAIR VICE-CHAIR MEMBER MEMBER MEMBER MEMBER ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 48 MANAGEMENT BOARD REPORT GOVERNANCE DERK HAANK Chair, member of the Nomina- tion Committee, member of the Remuneration Committee Derk Haank was CEO of Springer Nature, a worldwide publishing rm of scientic journals. Prior to that, he was CEO of academic publishing company Elsevier and a board member of Reed Elsevier (both predecessors of publicly listed RELX Group), and CEO of publishing company Misset. He currently is the chair of the supervisory board of navi- gation technology developer TomTom and a non-executive board member at online gaming and advertising company Azerion. Derk Haank holds a bachelor's degree in economics and a master's degree in business administration, both from the University of Amsterdam in the Netherlands. JEROEN DROST Vice-chair, chair of the Nomina- tion Committee Jeroen Drost was CEO of Dutch trading company SHV Holdings. He is still member of several boards of SHV-related companies. He started his career at ABN AMRO where he held various positions in the Netherlands and internationally. Subsequently he was CEO of Dutch commercial bank NIBC and CEO of investment rm NPM Capital. He currently holds various supervisory board posi- tions at Dutch listed companies, including employment agency Randstad and lighting company Signify. Jeroen Drost holds a bachelor's degree in economics and a master's degree in busi- ness economics, both from the Erasmus University in Rotterdam in the Netherlands. * Jeroen Drost stepped down from the Supervisory Board as per 7 February 2025. CARIN GORTER Member, chair of the Audit Committee Carin Gorter started her career at a predecessor of accoun- tancy rm EY Nederland. Subsequently, she held various management positions at Rabobank and ABN AMRO. She currently holds various super- visory board positions including, technology rm TKH Group, gym chain Basic-Fit (both Dutch listed companies) and legal and nancial services provider DAS Holding. Carin Gorter holds a master's degree in business economics and a postgraduate degree in accountancy, both from the University of Groningen in the Netherlands. Furthermore, she is Supervisory Board member of Nederlandse Transplantatie Stichting. ROELF DE BOER Member, chair of the Remunera- tion Committee, member of the Audit Committee Roelf de Boer started his career as an ofcer in the Royal Netherlands Marine Reserve Corps and subsequently held various positions in the port and transport industry, amongst others at Royal Nedlloyd Group. Furthermore, he held various public and semi-public positions including as minister of Trans- port, Public Works and Water Management of the Netherlands and president of the Rotterdam Chamber of Commerce. RUUD SPOOR Member, member of the Audit Committee Ruud Spoor has 40 years of experience in banking and nance include ten years in private equity. He started his career at ABN AMRO and subse- quently held positions at various investment and consultancy rms. Ruud Spoor holds a Bachelor of Commerce degree from the HES Rotterdam in the Netherlands. * Ruud Spoor stepped down from the Supervisory Board as per 30 August 2024. SASKIA SCHATTEMAN Member Saskia Schatteman has extensive experience in both the public and private sector, amongst others at Microsoft, Telenet and Procter & Gamble. In her role as a member of the Supervisory Board at Ebusco, she builds on extensive know- ledge of the public transport market (at De Lijn and NMBS). * Saskia Schatteman stepped down from the Supervisory Board as per 30 August 2024. Derk Haank - Chair Carin Gorter Roelf de Boer COMPOSITION OF THE SUPERVISORY BOARD ON 30 APRIL 2025 It has been an intense and eventful year for Ebusco. A year in which tough deci- sions had to be made. It was also a year in which we, as Supervisory Board, were heavily involved and in close and frequent consultation with management. REPORT OF THE SUPERVISORY BOARD manufacturability. As the Supervisory Board, we have been closely monitoring the development of the Turnaround Plan. In the last quarter of the year, with the launch of the Rights Issue, daily consulta - tions took place. Over the past year, several management changes have taken place, also affecting the structure of the Management Board. In light of evolving circumstances, we have decided to appoint a new CEO to effectively lead the turnaround process. We are very pleased with the appointment of Christian Schreyer to this role. He has extensive experience within the Public Transport and logistics sector, deep industry expertise and a strong track record in leading massive company turnarounds. As Transformation Director Michel van Maanen played an important role in the development of the Turnaround plan. In December we announced the intention to nominate him as COO and he was appointed at the EGM in March 2025. The new set up requires different competencies which align well with Michel’s extensive expertise in public transport. He will also remain heavily involved in the implementation of the Turnaround Plan. Towards the end of the year, CFO Jurjen Jongma announced that he would step down following the completion of the Rights Issue. Jan Piet Valk took on the role of interim CFO as of the end of November. Furthermore, it was decided to dissolve the Exec- utive Committee and to manage the company directly from the Management Board to achieve a leaner organization. The Rights Issue has also led to signicant changes in the shareholder structure, with Gotion and CVI Investment joining as new major shareholders. The changes in the shareholder base have also inu- enced the composition of the Boards. Mr. Jeroen Drost stepped down as Supervisory Board member as per 7 February 2025. Furthermore, under the Investment Agreement with Gotion they are enti- tled to a representative on both the Management and Supervisory Board. As per the EGM on 26 March, Mr. Duan Wei and Mr. Chen Li were provi- sionally appointed, subject to the conversion of the Accounts Payable by Gotion, as members of the Management and Supervisory Boards respectively. During the year, Ruud Spoor and Saskia Schat- teman stepped down as Supervisory Board members. As of the date of the report the Super- visory Board now consists of 3 members. The term of both Roelf de Boer and myself will end as per the 2025 AGM and we will not be available for reap- pointment. Therefore, this will be my last message as chair of Ebusco. We are pleased to have the new management team in place under Christian Schreyer’s leader- ship. Signicant steps have been taken to estab- lish the necessary conditions for the critical tran- sition Ebusco must undertake. Derk Haank Chair In the second half of 2023, the adjusted assembly strategy was implemented in order to scale up production with the support of third-party assembly partners. However, in the rst half of 2024, it became evident that this step alone was insufcient. Management, in consultation with the Supervisory Board, began developing a compre- hensive Turnaround Plan, which included the shift from an OEM model towards an OED model. In September, the intention to launch a Rights Issue was announced to enable the execution of the Turnaround Plan. The Turnaround Plan is aimed at ensuring a stable and timely operational output, enhancing overall efciency and improving Ebusco’s working capital position. It includes a rationalization of the value chain, simplication of processes and a further standardization of the company’s buses and their MESSAGE FROM CHAIR OF THE SUPERVISORY BOARD ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 49 MANAGEMENT BOARD REPORT GOVERNANCE GENERAL This report provides an overview of the approach and activities undertaken by the Supervisory Board in the year under review. In carrying out its duties, the Supervisory Board is guided by the Dutch Civil Code, the Dutch Corporate Governance Code, the company’s Articles of Associa - tion, the Management Board By-laws, insofar specic tasks and duties are designated to the Supervisory Board, the Supervisory Board By-laws, the charters of the respective committees of the Supervisory Board, the various company policies and the overall interests of the entire Ebusco group, the enterprises associated with it and its various stakeholders. COMPOSITION, INDEPENDENCE AND EDUCATION The Supervisory Board consists of knowledgeable individuals with outstanding reputations and expe- rience in supervisory roles. The Supervisory Board prole is aligned with the prole and strategy of Ebusco, with a balanced distribution of specic expertise in relation to its business activities, strategy and long-term goals. Ebusco aims to have a balanced Supervisory Board. In 2022 the Dutch law provided a mandatory gender quota, requiring that at least one-third of the Super- visory Board members are women and at least one-third are men, came into effect. The quota is applicable to the appointment of new Supervisory Board members. The quota is not applicable to the re-appointment of acting board members within eight years following their initial appointment. Diver- sity, including in terms of gender, is an important consideration in the selection process for the appointment and reappointment of members of the Supervisory Board going forward. Starting 2024, the gender quota was fullled. However, following the departures of Saskia Schatteman and Ruud Spoor as per 30 august 2024, Ebusco’s Supervisory Board currently consists of three members, with a compo- sition of 33% female and 67% male. The provisional appointment of Mr. Chen Li as per the 26 March EGM does not improve the gender balance. However, the Supervisory Board is of the opinion that excep- tional circumstances apply here, since the relation- ship with Gotion – including the right to nominate a Supervisory Board member of its choosing – is strategically of critical importance to Ebusco. If and when another vacancy arises in the coming years, the Supervisory Board will take the gender quota into account, next to the Supervisory Board prole, Dutch law and the Governance Code. The Supervisory Board strongly believes the over- riding principle for its composition that its members make a valuable contribution in terms of experience and expertise. In the opinion of the Supervisory Board, its size and composition meet the specica- tions laid down in the Supervisory Board prole. The Supervisory Board prole forms an integral part of the Supervisory Board by-laws. SUPERVISORY BOARD COMPOSITION Name Nationality Gender Financial expertise Number of supervisory board position held Derk Haank Dutch Male 2 Jeroen Drost* Dutch Male Yes 3 Carin Gorter Dutch Female Yes 4 Ruud Spoor Dutch Male Yes 1 Roelf de Boer Dutch Male 2 Saskia Schatteman Belgium Female 1 Name First appointment Term expiration Independent Number of supervisory board position held Derk Haank 26 October 2021 AGM 2025 X Nomination Committee, Remuneration Committee Jeroen Drost 26 October 2021 AGM 2028 Nomination Committee (chair) Carin Gorter 26 October 2021 AGM 2028 X Audit Committee (chair) Ruud Spoor 26 October 2021 AGM 2025 Audit Committee Roelf de Boer 26 October 2021 AGM 2025 Remuneration Committee (chair), audit committee Saskia Schatteman 17 May 2023 AGM 2027 X * Number of current supervisory board positions at listed and large entities, including Ebusco. ** Jeroen Drost stepped down from the Supervisory Board as per 7 February 2025. *** Ruud Spoor and Saskia Schatteman stepped down from the Supervisory Board as per 30 August 2024. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 50 MANAGEMENT BOARD REPORT GOVERNANCE During the 2024 AGM, the shareholders reappointed Mr. Roelf de Boer, Mr. Jeroen Drost, and Mrs. Carin Gorter as members of the Supervisory Board, effec- tive from the date of the AGM. Their terms are respec- tively one year for Roelf de Boer and four years for Jeroen Drost and Carin Gorter. The current term of Derk Haank and Roelf de Boer, both Supervisory Board members, will end per the 2025 AGM. Derk Haank and Roelf de Boer will not be available for reappointment. EVALUATION Although the Supervisory Board recognizes the importance of conducting an evaluation, more urgent matters had to be prioritized during the meetings. As a result, the formal evaluation was not completed this year for the Management Board as well for the Supervisory Board. The Supervisory Board remains committed to resuming the Evaluation process in the future to ensure ongoing reection and improvement. SUPERVISORY BOARD ENGAGEMENT 2024 The Supervisory Board met ofcially 9 times in 2024. Except for a limited number of occasions, and for valid reasons, Supervisory Board members attended all Supervisory Board meetings in 2024. In addi- tion, the chairman of the Supervisory Board was in regular and informal contact with the CEO(s) and the chairman of the Audit Committee stayed in regular, informal, contact with the CFO. The meetings addressed routine commercial, nan- cial and operational matters. The Supervisory Board devoted considerable time and dedicated meetings to discussing and assessing the company’s nan- cial status, cashow and treasury. In addition, the company's performance was an important topic in many meetings, as well as developments in the company's production capacity and the adaption in the production strategy. Furthermore, the capital increase by means of a Rights Issue was extensively discussed. Besides the regular business and nancial updates, the following topics were discussed during the meetings throughout the year: • Results 2024 • Status ZES • Financial Updates, cashflow and treasury • Cash forecasts • Amendments to articles of association • Proposal nominations • External audit plan • Composition Supervisory Board • Composition of the Management Board • Turnaround Plan • Annual report 2023 and planning annual report 2024 • Auditors report 2023 • Internal audit • AGM and EGM’s 2024 • Quarterly updates • Renegotiations claims • Update ESG and related reporting • Update legal and compliance • Update IT and cyber security • Update on LC extension • Re-start production • Rights Issue • New structure organization In response to the developments throughout 2024 the Supervisory Board held an additional 39 update calls and had several separate meetings to ensure they received adequate information. ATTENDANCE 2024 Except for a limited number of occasions, and for valid reasons, Supervisory Board members attended all Supervisory Board meetings in 2024. All Supervi- sory Board members made adequate time available to give sufcient attention to matters concerning the Company. Board attendance Held Attended % Derk Haank 9 9 100% Jeroen Drost 9 6 67% Carin Gorter 9 9 100% Ruud Spoor 6 5 83% Roelf de Boer 9 9 100% Saskia Schatteman 6 6 100% * Percentage calculated based on their duration of service as members of the Supervisory Board. The Audit Committee met ofcially 11 times in 2024. All meetings were in the presence of the CFO and almost all meetings were attended by the CEO. Almost all meetings were attended by the external auditor. In response of the continues operational and nancial challenges throughout 2024 the Audit Committee held next to the ofcial meetings 14 conference calls. Furthermore, the chair of the Audit Committee had frequent contact with the external auditor. Major topics discussed at the meetings included: • Cashflow development, financing and treasury • External audit plan, materiality thresholds and ma- nagement letter • Annual report including financial statements • Auditor’s report and key audit matters • Accounting and internal control update • Quarterly financial updates • IT and cybersecurity • Legal and compliance • Fraud risk assessment • Tax. Focus was given to cash management, working capital and nancing. Independent reviews were requested on the supply chain and operations processes and the forecasts made. ACTIVITIES OF THE SUPERVISORY BOARD COMMITTEES There are three committees that support the Super- visory Board: the Audit Committee, the Nomina- tion Committee and the Remuneration Committee. Each committee addresses relevant topics, and the chairman of the committee reports to the Super- visory Board on the discussions held within the committee and its main recommendations to the Supervisory Board as a whole. For all committee meetings, the supervisory Board members, not being members of the committee, received a standing invitation. For some occasions, supervisory board members made use of the invi - tation to participate as guests in these committee meetings. AUDIT COMMITTEE The Audit Committee consisted of three members, Carin Gorter (chair), Roelf de Boer and Ruud Spoor until August 30, when Ruud Spoor stepped down from the Supervisory Board. The Audit Commit- tee's main role is to perform preparatory work for the Supervisory Board's decision making regarding the supervision of the integrity and quality of the Company's nancial reporting and the effectiveness of the Company's internal risk management and control systems with respect to nancial reporting. The charter of the Audit Committee is available on the Company's corporate website. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 51 MANAGEMENT BOARD REPORT GOVERNANCE The Audit Committee concluded that, due to ongoing operational and nancial challenges, the internal control and risk management frameworks have not been given sufcient attention. Furthermore, the frameworks have not been aligned with the new way of working as an OED yet and, as a result, must still be considered below par. The very challenging busi- ness circumstances that Ebusco is has gone going through in the last months, and those which Ebusco continues to face, and the transformation the company is going through, including its renancing and restructuring efforts, have placed signicant demands on the time and resources of the company. As a result, the drafting of the 2024 nancial state- ments and consequently, the external auditor's audit process, have experienced delays, which prevented completion of the audit within the expected time- frame. Consequently, the nancial statements included in this annual report as published today, are unaudited. A plan to align the internal control framework towards the new business model is currently devel- oped and will be presented to the Audit Committee. In 2024 the internal audit function was not opera- tional. The Company will re-install the internal audit function in the course of 2025. Furthermore, the accounting changes have been discussed whereby the revenues for new bus production moves from percentage of completion towards point in time. Also, the nancial impact of the cancellations of buses has been discussed. The Audit Committee discussed revenue recogni- tion and the valuation and impairment of assets including goodwill, intangibles, right of use assets, tangible xed assets and inventories. At every meeting attention has been paid to the legal developments and in particular the potential nan- cial effects of claims and penalties due to logistical issues. The implementation plan for CSRD was discussed in the Audit Committee and the double materiality analysis. Due to the developments in the company, including the shift from an OEM to the OED model, it became clear in the course of 2024 that full compliance with the CSRD could not be reached in 2024 and therefor limited assurance by the external auditor was not in reach. NOMINATION COMMITTEE In 2024, the Nomination Committee consisted of two members: Jeroen Drost (chairman), and Derk Haank. The main responsibility of the committee is to assist the Supervisory Board and Management Board with the selection and appointment (and reappointment) procedures for members of the Supervisory Board and the Management Board. The charter of the Nomination Committee is available on the compa- ny’s corporate website. The Nomination Committee met 5 times in 2024. Per the 2024 AGM, the appointment term of Bob Fleuren, COO, expired. Mr. Fleuren informed the Supervisory Board that he was not available for reappointment. Following a search process, the Committee recom- mended Mr. Roald Dogge to the Supervisory Board for nomination as COO. Despite Ebusco’s intention to arrive at a gender-balanced Management Board, no female candidates were available for the position of COO. At the Annual General Meeting on 14 May 2024 Roald Dogge was appointed as a member of the Management Board (COO) for a term of 4 years as of 1 June 2024. In parallel, the Nomination Committee explored a permanent solution for the Co-CEO role, which had been temporarily lled by Frank Meurs and later by Michiel Peters. After careful consideration, the Supervisory Board concluded that a single CEO structure would better serve the company’s needs and nominated Mr. Christian Schreyer as CEO. At the Extraordinary General Meeting (EGM) on 24 October 2024, Christian Schreyer was appointed as a member of the Management Board (CEO) for a term ending at the 2028 AGM. Additionally, Mr. Jurjen Jongma, CFO and Mr. Roald Dogge, COO announced their decision to leave the company at the end of 2024, prompting the Nomina- tion Committee to swiftly address the CFO and COO vacancy. For the COO role, Michel van Maanen was nominated and at the Extraordinary General Meeting on 26 March 2025 appointed as a member of the Management Board (COO) for a term of 4 years. The CFO role is temporarily lled by Mr. Jan Piet Valk on an interim basis. The composition of the Management Board in 2024 was not in compliance with the gender balance target set for 2026. Per the 2025 AGM, the appointment term of Peter Bijvelds, Founder and member of the Management Board, will expire. Peter has expressed his commit- ment to continue in his position and will be available for re-election. Other topics discussed included the self-assess- ment of the Supervisory Board and the succession planning of the Supervisory Board. Furthermore, the Nomination Committee prepared the evaluation of the composition, performance and succession plan- ning of the Management Board. REMUNERATION COMMITTEE The Remuneration Committee consists of two members: Roelf de Boer (chairman) and Derk Haank. The main responsibility of the committee is to assist the Supervisory Board and Management Board in the establishment of an appropriate remunera - tion scheme for members of the Supervisory Board, members of the Management Board and, if so desired by the Management Board, members of the Manage - ment Team or other key gures within the organiza- tion. The charter of the Remuneration Committee is available on the company’s corporate website. The Remuneration Committee met 3 times in 2024. The Committee reviewed and approved the remuner- ation report as included in the annual report 2024 and prepared the proposal for the Management Board remuneration for 2025. An addition to the remuneration policy was proposed for the remuneration of Mr. Roald Dogge and Mr. Christian Schreyer. INDEPENDENCE The Supervisory Board conrms that from 1 January 2024 until 30 August 2024 the Supervisory Board existed of six members. Three Supervisory Board members were independent and three Supervisory Board members were considered not to be indepen- dent referring to best practice provision 2.1.8 vi of the Dutch Corporate Governance Code. This concerns the following Supervisory Board members. Ruud Spoor was nominated by Peter Bijvelds, Founder and member of the Management Board of Ebusco, as pre-IPO shareholder. Following Ruud Spoor's resig- nation from the Supervisory Board, Peter Bijvelds did not have representation on the board for a signi- cant portion of 2024. Jeroen Drost has been nomi- nated by ING, as pre-IPO shareholder. Roelf de Boer has been nominated by VDVI, as pre-IPO shareholder. From 30 August (after the resignation of Ruud Spoor and Saskia Schatteman, until the end of 2024, the Supervisory Board existed of 4 members of which two members were independent (Derk Haank and Carin Gorter) and two were considered not to be independent (Jeroen Drost and Roelf de Boer). The Supervisory Board is of the opinion that the Board complies with the following articles of the best practice provisions of the Corporate Gover- nance Code. 2.1.7 regarding independence of the Supervisory Board, except for 2.1.7 ii (more than half of the total number of Supervisory Board members should be considered independent) and 2.1.9 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 52 MANAGEMENT BOARD REPORT GOVERNANCE In 2024 the composition of the committees was not in compliance with best practice provision 2.3.4, as half of the members were considered not to be inde- pendent. 2024 FINANCIAL STATEMENTS The very challenging business circumstances that Ebusco has gone through in the last months, and those which Ebusco continues to face, and the transformation the company is going through, including its renancing and restructuring efforts, have placed signicant demands on the time and resources of the company. As a result, the drafting of the 2024 nancial state- ments and consequently, the external auditor's audit process, have experienced delays, which prevented completion of the audit within the expected time- frame. Consequently, the nancial statements included in this annual report as published today, are unaudited. Ebusco will publish audited nancial statements when they are available. The General Meeting of Shareholders, to be held on June 16,2025, will be asked to adopt the audited nancial statements. In addition, it recommends that the members of the Management Board and Supervisory Board be discharged from liability for their respective management and supervisory activities performed in 2024. Deurne, the Netherlands, 30 April 2025 Derk Haank Carin Gorter Roelf de Boer ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 53 MANAGEMENT BOARD REPORT GOVERNANCE REMUNERATION REPORT This report describes how the Remuneration Policies of the Management Board and Supervisory Board were implemented in 2024. This report was prepared by the Management Board and the Remuneration Committee of the Superviso- ry Board. The Remuneration Committee makes rec- ommendations to the Supervisory Board regarding the remuneration policy, as adopted by the General Meeting, for the Management Board and how to ap- ply this policy to the remuneration of the individual Management Board members. This remuneration report combines the requirements that the Remuneration Committee must adhere to when preparing a remuneration report in line with the best practice provisions of the Dutch Corporate Gover - nance Code (the ‘Code’) and with the requirements as contained in Article 2:135b and Article 2:145 paragraph 2 of the Dutch Civil Code. This remuneration report is published on the company’s corporate website as part of the annual report and will be submitted to the Annual General Meeting of Shareholders (AGM) on 16 June 2025 for an advisory vote. During the AGM held on 14 May 2024, the advisory vote on the 2023 Remuner - ation Report received 99.23% of the votes cast in favor. This remuneration report is based on the current remuneration policy that was approved by and became effective following the General Meeting on 17 October 2021, prior to the company’s public listing on Euronext. Any subsequent changes to the remu- neration policy are subject to the approval of the General Meeting of Shareholders. Consistent with the best practice principles of the Code, the rst part of this remuneration report describes the remuneration policy for the members of the Management Board, while the second part sets out how the remuneration policy was implemented in 2024. The report concludes with the details of the remuneration policy of the Supervisory Board and how this remuneration policy was implemented in 2024. REMUNERATION POLICY The remuneration policy aims to attract, retain and reward highly qualied executives with the required background, skills, and experience needed for a company the size and complexity of Ebusco. The policy is transparent and aligns with the interests of the company’s shareholders and other stakeholders. Pursuant to the remuneration policy, the remunera - tion packages of the members of the Management Board consist of xed and variable components. The variable remuneration is linked to predetermined, assessable, and inuenceable targets, which are predominantly of a long-term nature. The remuner - ation policy is in keeping with the entrepreneurial culture of Ebusco and aims to achieve a good balance between xed and variable income, whereby the base compensation is relatively low and the variable compensation, provided that targets have been achieved, relatively high. Account was taken of scenario analyses in drafting the remuneration policy. PEER GROUP In 2021, in anticipation of the listing, the company commissioned an independent remuneration consulting rm to provide advice on the remunera - tion of the Management Board and Supervisory Board within the framework of the proposed remuneration policy. Based on this external advice Ebusco decided to set a base salary level around the median gure of the base salaries of the companies comprising the AScX Index whilst the annual cash bonus (STI) and performance share bonus (LTI) would be based upon the upper 25 percentile of the AScX Index companies. These compensation levels were consistent with the characteristics of Ebusco as well as in line with Ebus - co’s growth perspective. The remuneration of the Management Board consists of ve elements: • Fixed compensation - annual base salary • Short-term incentive - annual cash bonus plan • Long-term incentive - annual performance share plan • Pension allowance and other benets (e.g. expense reimbursements) • Severance payments FIXED REMUNERATION The annual base salary of the Management Board members is a xed compensation set by the Supervi- sory Board that considers a variety of factors. Based on the peer group benchmark, the xed compensa- tion of the members of the Management Board was adjusted on 17 October 2021. In determining the remuneration of the Management Board, the Supervisory Board also considers the impact of the overall remuneration of the Management Board on the pay differential within Ebusco. In line with the Code Ebusco considered the internal pay ratios within the organization when formulating the remuneration policy and when determining the remuneration of indi - vidual members of the Management Board. The Supervisory Board can make discretionary adjustments to the outcome of variable remunera- tion, if the outcome is deemed unfair. In that case, the Supervisory Board can deviate from the policies set out above, when the members of the Supervi- sory Board consider this necessary or desirable in specic individual cases. SHORT-TERM INCENTIVE (STI) The STI is an annual cash bonus. The objective is to incentivize strong nancial and personal perfor- mance, in line with Ebusco’s strategy and annually dened targets. The bonus for the members of the Management Board may vary from 0% to 50% of the annual xed base salary, with 30% being applicable when targets are achieved, for both nancial and non-nancial personal targets. The payout at the threshold level is 15%, and 50% in the event of outperformance, to be determined for each separate target. These bonus percentages are at the high end of the upper 25 percentile of the AScX companies. Targets are set annually by the Supervisory Board based on the budget and with a view to the compa- ny’s strategic ambitions. Financial targets comprise 70% of the bonus, while non-nancial or individual targets make up the remaining 30%. A performance zone is set for each of the nancial targets, with no bonus below the threshold level and the maximum bonus when the performance exceeds the upper end of the performance zone, in accor- dance with the following parameters: ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 54 MANAGEMENT BOARD REPORT GOVERNANCE Financial target Payout (% of annual base salary) Threshold 80% achievement of Roll-Out Plan target 15% At Target 100% achievement of Roll-Out Plan target 30% Out performance 120% achievement of Roll-Out Plan target 50% Awards of performance share units will vest at the end of a three-year performance period subject to (i) the achievement of predetermined revenue growth targets consistent with the creation of long-term company value; and (ii) the continued service as a Management Board member with the company. The performance shares are subject to a holding period of two more years after vesting date. Where required to ensure an appropriate reection of performance, the Supervisory Board may at its discretion amend the level of vesting of performance share units, with the understanding that the award may not be increased in excess of the performance incentive zone. Any such discretionary amendment which would result in an increase in pay-out of more than 25% is subject to prior approval by the General Meeting of Shareholders. PENSION ALLOWANCE AND OTHER BENEFITS The members of the Management Board have been granted a pension allowance of an amount that is between 11% and 16% of their base salary, excluding any allowances and bonus payments. Other benets include 25 days of paid vacation per calendar year. Furthermore, the members of the Management Board receive a car and/or housing allowance or company car. Apart from these bene- ts, no other benets are granted. SEVERANCE PAYMENT The service agreements with the Management Board stipulate a notice period of six months and include a severance payment of six months of xed base salary in the event of involuntary termination. No severance payment will be made in the event of serious imput - able or negligent behavior. This is compliant with the best practice provision of the Dutch Corporate Gover - nance Code on severance pay. CLAW-BACK AND ULTIMUM REMEDIUM Variable remuneration may be adjusted or recovered from a member of the Management Board, in accor- dance with the relevant provisions in the Dutch Civil Code, as amended from time to time. AMENDMENT REMUNERATION POLICY On 15 May 2024, the Supervisory Board, following the advice of the Remuneration Committee, requested the approval of the AGM regarding the below mentioned individual change to the current remu- neration policy. 98.39% of votes cast in favor of the advisory vote on this adjustment. This individual adjustment was required to align the policy with the remuneration package of Mr R. Dogge who was appointed COO on 15 May 2024 and stepped down as of 31 December 2024. The deviating element meant that Mr. Dogge was granted a one-off advance of EUR 225,000, which was planned to be repaid by offsetting the advance against the Short- Term Incentive (STI). The exception only applied to Mr. Dogge and does not affect the remuneration of the other members of the Management Board. The other features of the remuneration package were in line with the policy. On 24 October 2024, the Supervisory Board, following the advice of the Remuneration Committee, requested the approval of the EGM regarding the below mentioned individual change to the current remuneration policy. 99.94% of votes cast in favor of the advisory vote on this adjustment. This individual adjustment was required to align the policy with the remuneration package of Mr C. Schreyer who was appointed CEO on 24 October 2024. The deviating element means that Mr. Schreyer will be granted 60,000 Ebusco shares that will vest in three years after his appointment by the The Supervisory Board may change the percentages and targets from time to time. LONG TERM INCENTIVE (LTI) The purpose of the long-term incentive plan is to align the interests of the company, shareholders and the Management Board for the medium and long term, to foster and reward sustainable perfor- mance and to provide an incentive for long-term commitment, thus promoting Management Board retention. Under the company’s long-term incentive plan members of the Management Board may be awarded conditional performance share units from the 2024 nancial year onwards. The LTI is related to the performance on the company goals, which are dened on the following metrics; revenues, EBITDA margin and development and implementation of ESG strategy. The overall PSU vesting is subject to meeting the ESG target. In case the ESG target will not be met, no PSU’s will vest irrespective of nan- cial performance. For all members of the Management Board the at-target value of the award may amount to 100% of their annual xed base salary in the respective year. When considered appropriate, the Remuneration Committee may apply at its discretion a performance incentive zone between 0% and 150% of the at-target value of the award depending on the long-term and sustainable performance achieved during the performance period. Furthermore, the Remuneration Committee has the discretion to introduce a non- - nancial target as an underpin to ensure sustained long-term performance (e.g. relating to ESG). Performance conditions measured over the 3 year performance period PSU Vesting percentage Threshold: <80% achievement of the company goals 0% Between 80 - 100% achievement of the company goals Between 1% and 100% on a straight-line basis At target: 100% achievement of the company goals related to the Roll-Out Plan 100% Between 100 -120 achievement of the company goals Between 100% and 150% on a straight-line basis Out performance: 120% achievement of the company goals related to the Roll-Out Plan 150% ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 55 MANAGEMENT BOARD REPORT GOVERNANCE EGM provided that Mr. Schreyer is still working for the Company in the role of CEO at that time. The excep- tion only applies to Mr. Schreyer and does not affect the remuneration of the other members of the Exec- utive Board. The other features of the remuneration package are in line with the policy. Fixed base salary Pension allowance STI LTI Other Total Fixed compensation as % of total Variable compensation as % of total Peter Bijvelds and Christian Schreyer (CEO) €498,480 €54,454 €0 €0 €24,073 €573,857 100% 0% Jurjen Jongma (CFO) €272,552 €44,600 €0 €0 €192,015 €508,176 100% 0% Bob Fleuren and Roald Dogge (COO) €283,325 €46,362 €0 €0 €243,070 €586,099 100% 0% Peter Bijvelds (Founder) €132,501 €21,570 €0 €0 €7,586 €162,793 100% 0% Total €1,198,666 €166,985.67 €0 €0 €466,744 €1,830,924 100% 0% * “Other” includes car allowance, settlements and other compensations ** The remuneration of the CEO includes the remuneration of Peter Bijvelds (stepped down as CEO on 2 September 2024) and Christian Schreyer (CEO and member of the management board as from 24 October 2024). *** The remuneration of the CFO includes the remuneration of Jurjen Jongma until 30 November 2024. As the Board Member agreement with Jurjen Jongma was terminated with immediate effect, the service fee for the six months’ notice period was paid out. The remuneration of the COO includes the remuneration of Bob Fleuren (resigned as COO on 14 May 2024) and Roald Dogge (COO and member of the management board from 1 June 2024 until 31 December 2024) including the one-off advance that was waived as part of the severance payment. * As from September 2024. Mr. C. Schreyer was granted an advance service fee payment of six months (EUR 225.000 gross), which will be set off against the pro-rated Service Fee that is due during the following six months of providing the services. Due to the change in role of Mr. P. Bijvelds in the Management Board his annual base service fee has been reduced as of 1 September 2024 by 5%. MANAGEMENT BOARD REMUNERATION 2024 The total remuneration of each individual member of the Management Board recognized and paid by the company in 2024 is as follows. The total remuneration of each individual member of the Management Board recognized and paid by the company in 2023 is as follows: Fixed base salary Pension allowance STI LTI Other Total Fixed compensation as % of total Variable compensation as % of total Peter Bijvelds (CEO) €410,220 €65,635 € 0 € 0 €16,256 €492,112 100% 0% Paul van Beers,Björn Krook, Jurjen Jongma (CFO) €292,063 €31,666 € 0 € 0 €40,933 €364,662 100% 0% Bob Fleuren (COO) €291,500 €46,640 € 0 € 0 €18,058 €356,198 100% 0% Total €993,783 €143,942 € 0 € 0 €75,248 €1,212,972 100% 0% * Paul van Beers (resigned as CFO on 31 March 2023), Björn Krook (ad interim CFO between 1 April 2023 and 6 September 2023) and Jurjen Jongma (CFO per 7 September 2023) FIXED COMPENSATION For the nancial year 2024, these annual base salaries have been increased by 2% for the 2024 nancial year. The Remuneration Committee also reviewed whether the remuneration policy is still suitable for the level and size of the company, and more specically, if the remuneration level is in line with the market. In 2024, the Remuneration Committee concluded that the remuneration of the members of the Management Board was in line with market practices and within the boundaries of the remuneration policy. SHORT-TERM INCENTIVE (STI) For the 2024 short-term incentive the supervi- sory board set the targets based on the following elements: The nancial targets (70%, equal weighting for each target) relate to: • Orderbook (# of buses): The orderbook is dened as all orders for which a signed contract is in place, an option for another order within an existing contract and call-off contracts. • Deliveries (# of buses): Deliveries are dened as de - livery to and acceptance by the customer. • EBITDA The non-nancial and personal targets (30%) relate to: • Execution of the roll-out plan (20%) • Continuous cost price reduction (20%) • People, processes and procedures (40%) • Personal targets (20%) No STI was granted for 2024. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 56 MANAGEMENT BOARD REPORT GOVERNANCE LONG-TERM INCENTIVE: PERFORMANCE SHARE PLAN With the start of the three-year performance pe- riod in 2024, members of the Management Board became eligible for conditional performance share units as part of the company’s long-term incentive plan. Similar to the STI, no shares were granted un- der the performance share plan in 2024. PAY RATIO With a view to transparency and clarity, Ebusco calcu- lated the internal pay ratios based on the remunera- tion included in the consolidated nancial statements. Ebusco’s CEO pay ratio is calculated as the total CEO remuneration divided by the average remuneration of all employees, excluding the remuneration of Manage - ment Board members. For the purposes of this calcula- tion, all remuneration elements are included in the total remuneration for the CEO based on the information provided in note 7.1 - Remuneration Key Management. Average employee remuneration is based on total employee benet expenses excluding benet expenses of the Management Board and Supervisory Board as disclosed in note 7 - Employee benets expense, and the total average number of employees in FTEs as also disclosed in note 7, Employee benets expense. Ebusco’s calculated CEO pay ratio in 2024 was 7.3 (2023: 6.6). These internal pay ratios are closely moni - tored by the Remuneration Committee. HISTORIC PERSPECTIVE The following table summarizes the remuneration of the members of the Management Board and accompanying pay ratios in previous years and the change from 2023 to 2024 (in absolute numbers and in percentages): Change Yoy 2024 2023 in EUR in % 2022 2021 2020 Remuneration Management Board (in EUR) Total remuneration CEO 573,857 492,112 81,745 17% 459,996 286,602 281,689 Total remuneration CFO 508,176 364,662 143,514 39% 338,001 5,315,497 316,477 Total remuneration COO 586,099 356,198 229,901 65% 336,261 212,546 0 Total remuneration Founder 162,793 0 162,793 N/A 0 0 0 Ebusco performance (all in EUR millions) Revenue 10.7 102.4 (91.8) (90%) 111.6 24.3 100.0 EBITDA (132.6) (95.7) (36.9) 39% (34.8) (20.5) 27.1 Free Cash Flow (61.7) (123.5) 61.7 (50%) (107.5) (25.6) (15.9) Pay ratio Pay ratio CEO 7.3 6.6 0.7 10% 7.2 4.7 4.6 Average total remuneration Ebusco employees 78,666 74,144 4,522 6% 63,720 60,452 60,868 ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 57 MANAGEMENT BOARD REPORT GOVERNANCE REMUNERATION MANAGEMENT BOARD IN 2025 The base salary remuneration of the members of the Management Board will not be increased for the 2025 nancial year. With regard to the variable remuneration components, targets will be set for the STI as well as the LTI which may be granted in 2025 pending performance. SUPERVISORY BOARD REMUNERATION 2024 The remuneration of Supervisory Board members consists of xed annual fees for their role as Super- visory Board members. In addition, the chair and members of the Nomination Committee, Audit Committee and Remuneration Committee receive a xed annual fee for these roles. Ebusco does not grant variable remuneration, shares or options to members of the Supervisory Board. Ebusco pays company-related travel and accommodation expenses related to meetings. The remuneration policy of Supervisory Board members is considered market conform. ANNUAL FEES PER FUNCTION IN THE SUPERVISORY BOARD Function Remuneration Chair 50,000 Member 40,000 ANNUAL FEES PER FUNCTION IN SUPERVISORY BOARD COMMITTEES Function Remuneration Chair 50,000 Member 40,000 Audit committee - Chairman 10,000 Audit Committee - Member 7,000 Nomination Committee - Chairman 7,000 Nomination Committee - Member 4,000 Remuneration Committee - Chairman 7,000 Remuneration Committee - Member 4,000 FEES OF SUPERVISORY BOARD MEMBERS IN 2024 Function 2024 2023 Derk Haank 58,000 58,000 Roelf de Boer 54,000 55,750 Carin Gorter 50,000 50,000 Jeroen Drost 47,000 47,000 Ruud Spoor 31,333 47,000 Saskia Schatteman 31,333 40,000 OTHER INFORMATION TOTAL REMUNERATION The total annual remuneration for the members of the Management Board and Supervisory Board as recognized by the company during 2024 amounts to €2,102,590 (2023: €1,510,722). OTHER ARRANGEMENTS No remuneration has been granted and allocated by subsidiaries or other companies whose nancials are consolidated by Ebusco, since all members of the Management Board and Supervisory Board are paid directly by Ebusco Holding N.V. No (personal) loans have been granted to the members of the Management Board and the Super- visory Board and no guarantees have been provided to any of the members of the Management Board and Supervisory Board. No variable remuneration has been clawed-back. ANNUAL REPORT EBUSCO 2024 INTRODUCTION OTHER INFORMATIONFINANCIAL STATEMENTS 58 MANAGEMENT BOARD REPORT GOVERNANCE FINANCIAL STATEMENTS ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 59 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Consolidated statement of profit or loss and other comprehensive income 60 Consolidated statement of financial position 61 Consolidated statement of changes in equity 62 Consolidated statement of cash flows 63 Notes to the consolidated financial statement 64 Company statement of profit or loss 94 Company statement of financial position 95 Notes to the company financial statements 96 CONTENT ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 60 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME In thousands of euro, unless stated otherwise Notes (Unaudited) 2024 2023 Revenue 5.1 Cost of materials 5.2 Employee benefit expenses 6 Amortization and depreciation expenses 11, 12, 21 Other operating expenses 7 Operating expenses Operating result Finance expenses, net 8 Share of result of an associate 13 Result before tax Income tax credit/(expense) 9 Result for the year Result for the year attributable to: Equity holders of the Group Non-controlling interests Result for the year (200,771) (120,146) Other comprehensive income Other comprehensive income that may be reclassified to profit or loss in subsequent periods Exchange differences on translation of foreign operations 8 (4) Net gain/(loss) on cash flow hedges - 3,679 Tax effect of changes in cash flow hedges - 332 Net change in costs of hedging - - Tax effect of changes in cost of hedging - - Other comprehensive income/(loss) 8 4,007 Total comprehensive income/(loss) for the year (200,763) (116,139) Total comprehensive income/(loss) for the year attributable to: Equity holders of the Group (200,624) (115,152) Non-controlling interests (139) (987) Basic earnings per share (in euros) for result attributable to shareholders of the Group 10 (10.79) (10.06) Diluted earnings per share (in euros) for result attributable to shareholders of the Group 10 (10.79) (10.06) The Group’s 2023 earnings per share have been restated for which it further refers to Note 10. Notes (Unaudited) 2024 2023 10,665 102,440 (198) (14,474) (200,771) (120,146) (200,632) (119,159) (139) (987) (45,267) (109,288) (42,501) (38,467) (63,747) (8,136) (55,532) (50,418) (207,047) (206,309) (196,382) (103,869) (1,156) (871) (200,573) (105,672) (3,035) ( 932) ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 61 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Equity Share capital 3,274 640 Share premium 388,880 337,379 Reserves 11,920 23,085 Retained earnings (376,572) (181,281) Equity attributable to equity holders of the Group 18.1 27,502 179,823 Non-controlling interests 18.2 - (1,526) Total Equity 18 27,502 178,297 Liabilities Non-current liabilities Provisions 22 222 1,133 Non-current lease liabilities 20, 21 19,854 14,216 Other non-current liabilities 1,465 491 21,541 15,840 Current liabilities Loans and borrowings 20 5,359 1,348 Convertible bond – debt 19, 20 14,079 28,161 Convertible bond – embedded derivative 19, 20 3,766 4,965 Provisions 22 11,145 8,654 Trade payables 23 24,981 30,518 Contract liabilities 5 44,430 18,939 Other current liabilities 23 22,913 30,602 Current lease liabilities 20, 21 4,261 2,382 Income tax payable 9 86 125 131,020 125,694 Total liabilities 152,561 141,534 Total equity and liabilities 180,063 319,831 CONSOLIDATED STATEMENT OF FINANCIAL POSITION In thousands of euro Notes (Unaudited)As at 31 December 2024 As at 31 December 2023 Assets Non-current assets Property, plant and equipment 11 11,715 22,398 Right-of-use assets 21 22,270 15,902 Intangible assets 12 5,376 49,888 Deferred tax assets 9 - - Investments in associates 4, 13 3,036 2,547 Non-current financial assets 634 614 43,031 91,349 Current assets Inventories 14 117,677 106,541 Trade receivables 15 5,494 19,285 Contract assets 5 7,569 67,640 Other current assets 16 3,893 7,098 Cash and cash equivalents 17 2,399 27,918 137,032 228,482 Total assets 180,063 319,831 Notes (Unaudited)As at 31 December 2024 As at 31 December 2023 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 62 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF CHANGES IN EQUITY In thousands of euro Equity attributable to Equity holders of the Group Non-controlling interests Total Equity Notes Share capital Share premium Translation reserve Cash flow hedge reserve Cost of hedging reserve Other reserve Retained Earnings Total Equity attributable to Equity holders of the Group Balance as at 1 January 2023 590 315,324 14 966 - 15,354 (58,251) 273,997 (539) 273,458 Result for the year - - - - - - (119,159) (119,159) (987) (120,146) Other comprehensive income 18 - - (4) 4,011 - - - 4,007 - 4,007 Total comprehensive income for the year 18 - - (4) 4,011 - - (119,159) (115,152) (987) (116,139) Shares issued 18 50 24,950 - - - - 25,000 - 25,000 Share issuance expenses 9, 18 - (2,895) - - - - (2,895) - (2,895) Share based payment expenses 6 - - - - 185 - 185 - 185 Transfer to/from legal reserve 18 - - - - 3,871 (3,871) - - - Transfer of cash flow hedge reserve - - - (1,313) - - - (1,313) - (1,313) Balance as at 31 December 2023 640 337,379 10 3,664 - 19,411 (181,281) 179,823 (1,526) 178,297 Balance as at 1 January 2024 640 337,379 10 3,664 - 19,411 (181,281) 179,823 (1,526) 178,297 Result for the year - - - - - - (200,632) (200,632) (139) (200,771) Other comprehensive income 18 - - 8 - - - - 8 - 8 Total comprehensive income for the year 18 - - 8 - - - (200,632) (200,624) (139) (200,763) Shares issued 18 2,633 52,936 - - - - - 55,569 - 55,569 Share issuance expenses 9, 18 - (1,435) - - - - - (1,435) - (1,435) Share based payment expenses 6 - - - - - (348) - (348) - (348) Acquisition of non-controlling interest 18 - - - - - (152) (1,665) (1,817) 1,665 (152) Transfer to/from legal reserve 18 - - - - - (7,006) 7,006 - - - Transfer of cash flow hedge reserve - - - (3,664) - - - (3,664) - (3,664) Balance as at 31 December 2024 (Unaudited) 3,274 388,880 18 - - 11,902 (376,572) 27,502 - 27,502 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 63 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF CASH FLOWS In thousands of euro Notes (Unaudited) 2024 2023 Cash flows from operating activities Profit/(Loss) before tax (200,573) (105,672) Non-cash adjustments: Depreciation of property, plant and equipment and right-of-use assets 11, 21 18,008 5,736 Amortization of intangible assets 12 45,707 2,325 Gain/(Loss) on disposal of property, plant and equipment 11 - 75 Share based payment expenses 6 (283) 185 Net loss on derivative instruments at fair value through profit or loss 27 (1,200) - Additions to/(release from) provisions 22 13,653 9,519 Finance expenses, net 8 3,094 974 Share of results of an associate 13 1,156 871 Movements in working capital: Inventories 14 (11,136) (59,099) Receivables and other financial assets 15, 16, 17 16,580 8,376 Contract assets/liabilities 5 85,562 5,358 Payables and other current liabilities 23 (1,631) 28,277 Cash generated from operations (31,062) (103,075) Payment from provisions 22 (12,073) (656) Income tax paid 9 (39) (69) Net cash flows from operating activities (43,175) (103,799) (Unaudited) 2024 Cash flows from investment activities Investments in property, plant and equipment 11 (14,462) (15,018) Investments in intangible assets 12 (805) (2,102) Investment in financial assets (20) (601) Investment in associates 13 (1,645) (2,350) Net cash flows from investment activities (16,933) (20,071) Cash flows from financing activities Net proceeds from issuance of share capital 18 35,999 24,602 Acquisition of non-controlling interest 18 (152) - Proceeds from borrowings 20 5,359 54,961 Repayments of borrowings 20 (1,348) (20,000) Payment of principal portion of lease liabilities 21 (3,270) (1,932) Interest received 8 79 276 Interest and similar expenses paid 8 (2,081) (1,331) Net cash flows from financing activities 34,586 56,576 (Decrease)/Increase in cash and cash equivalents (25,521) (67,293) Exchange losses/gains on cash, cash equivalents and bank overdrafts 8 2 (1) Cash and cash equivalents at 1 January 17 27,918 95,212 Cash and cash equivalents at 31 December 17 2,399 27,918 Notes (Unaudited) 2024 2023 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 64 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. CORPORATE INFORMATION Ebusco Holding N.V. is a public limited Company under Dutch law, incorporated and domiciled in the Neth- erlands and registered at the Chamber of Commerce in the Netherlands under number 75407922. Ebusco Holding N.V. is the ultimate parent company of the group of legal entities (together, “the Group”) and is listed on Euronext Amsterdam. The Group is a developer, manufacturer and distributor of zero emission buses and charging systems, as well as a supplier of ancillary services to the electric vehicle ecosystem and manufac- turer and supplier of Energy Storage Systems (ESS) and Mobile Energy Containers (MECs). The Group has its headquarters and registered office located at Vuurijzer 23, 5753 SV Deurne, The Nether- lands. The very challenging business circumstances that Ebusco has gone through in the last months, and those which Ebusco continues to face and the transformation the company is going through, including its re- financing and restructuring efforts, have placed significant demands on the time and resources of the com- pany. As a result, the drafting of the 2024 financial statements and consequently, the external auditor's audit process, have experienced delays, which prevented completion of the audit within the expected timeframe. Consequently, the financial statements included in this annual report as published today, are unaudited. 2. MATERIAL ACCOUNTING POLICIES 2.1 BASIS OF CONSOLIDATION The consolidated financial statements comprise the financial statements of the Parent and its subsidiaries (or ‘group companies’) as at 31 December 2024 with comparative information for the year ended 31 December 2023. Subsidiaries are fully consolidated from the date the Group acquires control and ceases when the Group loses control of the subsidiary. The Group controls an investee if, and only if, the Group has: • Power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee); • Exposure, or rights, to variable returns from its involvement with the investee; • The ability to use its power over the investee to affect its returns. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. All intra-group assets and liabilities, equity, income and expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. When the Group loses control over a subsidiary, it derecognizes the related assets (including goodwill), liabilities, and other components of equity, while any resulting gain or loss is recognized in profit or loss. The following table provides an overview of the consolidated subsidiaries which the Parent controls: Entity Registered office Date of OwnershipOwnershipincorporationinterest (%)interest (%)31 December 31 December 20242023Ebusco B.V. Deurne, Netherlands 3 September 2012 100% 100%Ebusco Energy B.V. Deurne, Netherlands 18 July 2019 100% 100%Ebusco Manufacturing B.V. Deurne, Netherlands 15 July 2020 100% 100%Pondus Operations B.V. Deurne, Netherlands 16 March 2017 - 90%Ebusco Deutschland GmbH Emmerich am Rhein, Germany 13 June 2016 100% 100%Ebusco Norway A/S Dal, Norway 2 February 2017 100% 100%Ebusco Australia Pty Ltd Tasmania, Australia 18 July 2019 100% 100%Ebusco France Manufacturing SAS Paris, France 9 November 2020 100% 100%Ebusco France Sales SAS Paris, France 11 October 2023 - 100%Ebusco North America LLC Delaware, United States 19 August 2021 - 100%Ebusco New Energy (Xiamen) Co Ltd Xiamen, China 17 September 2021 100% 100%Ebusco Canada Inc. Toronto, Canada February 9, 2022 - 100%Ebusco Sweden AB Göteborg, Sweden March 8, 2022 100% 100%Ebusco Denmark ApS Kopenhagen, Denmark April 7, 2022 100% 100%Ebusco Italy S.r.l. Turin, Italy June 20, 2022 100% 100%Ebusco Spain SL Barcelona, Spain August 18, 2022 100% 100% * Ebusco B.V. acquired the remaining 10% during 2024 and merged Pondus Operations B.V. into Ebusco B.V. as of 1 July 2024. ** Ebusco France Sales SAS has been merged into Ebusco France Manufacturing SAS per 31 December 2024. *** Ebusco North America LLC and Ebusco Canada Inc. have been liquidated during 2024. 2.2 BASIS OF PREPARATION The consolidated financial statements of the Group have been prepared in accordance with IFRS accounting standards as issued by the International Accounting Standards Board (IASB) and endorsed by the European Union (EU) and with the statutory provisions of Part 9, Book 2 of the Dutch Civil Code. The financial statements were signed and authorized for issuance by the Supervisory Board and Management Board on 30 April 2025. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 65 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS * The current ratio is calculated by dividing the total current assets by the total current liabilities (excluding the convertible bond -debt and convertible bond – embedded derivative). The consolidated financial statements have been prepared on a historical cost basis, except when otherwise indicated. All amounts are stated in thousands of EUR, unless otherwise stated. 2.3 GOING CONCERN Ebusco faced significant operational and financial challenges throughout 2024, including production inef- ficiencies, order cancellations, and liquidity constraints. In response, the Group initiated a comprehensive Turnaround Plan aimed at improving performance and restoring stakeholder confidence. A pivotal component of this plan is the strategic shift from an Original Equipment Manufacturer (OEM) model to an Original Equipment Design (OED) model, transitioning from in-house production to utilizing contract manufacturers. This move aims to streamline operations and reduce costs on the mid- and long-term. For the year-ended 31 December 2024 the Group incurred a net loss before tax of €200.6 million (2023: €105.7 million), resulting in net cash outflow from operating activities of €43.2 million (2023: €103.8 million). As of 31 December 2024, the Group had negative retained earnings of €376.6 million and a net equity position of €27.5 million, versus negative €181.3 million and €178.3 million, as of 31 December 2023, respectively. Given the Group’s financial situation, it currently depends on third-party suppliers agreeing to payment sched- ules and alternative settlement options on overdue accounts. Considering the overdue accounts payable position (as at the date of this report) significantly exceeds the Group’s current liquidity position, there is a possibility that suppliers could file for bankruptcy at any given moment which the Group cannot address directly and would trigger an insolvency event. One of the Group’s suppliers actually already filed a petition for bankruptcy due to (amongst others) non-payment of overdue invoices. The court case is scheduled for 6 May 2025. The Group is therefore dependent upon a significant short-term liquidity injection in order to be able to continue as a going concern. The Group is currently in the progress of finding a strategic investor and in obtaining refinancing. Although the Group is putting significant effort into both solutions, it is uncertain whether such investor or financing can be timely attracted. If the Group is not able to (timely) attract the required liquidity injection it could directly face insolvency. After the balance sheet date, the Group obtained debt financing commitments for a total amount of €22 million from Green Innovation International Co. Ltd. (€10 million, of which the Groups still needs to receive €5 million), CVI Investments Inc., an entity managed by Heights Capital Management, Inc. (€10 million) and De Engh B.V. (€2 million) in Q1 2025. These loans (including interest of €2.2 million) must be fully repaid by Ebusco by 15 August 2025. In addition, Green Innovation International Co. Ltd. and De Engh have agreed an option to convert the full loan amount plus the fee at their election into Ebusco shares. If the Group would be able to attract the referred short-term liquidity injection it aims to further roll-out its Turnaround Plan and improve both its operating and financial performance and to repay these loans. If the short-term liquidity injection is not timely obtained and/or , the Turnaround Plan is not executed adequately or the Group runs into other unforeseen circumstances, the Group is dependent upon the conversion of the loans into shares by the referred to financing parties. In addition, the Group’s business model is dependent on letters of credit (LCs) from its banks for the payment of finished products being provided to its contract manufacturers and as such allowing the Group to receive the finished products and deliver them to customers before payment is due to the contract manufacturers. Although the Group has confirmation of continuation of the current outstanding letters of credit facilities for €9 million until 14 August 2025, by which time these facilities must in any event be fully repaid, the Group, however has triggered events of default with its existing agreement with the banks. One of the events of default is the non-payment of Green Innovation of the full loan since only €5 million was transferred instead of the agreed upon €10 million. It is currently unclear if and when Green Innovation will transfer the €5 million to the Group. This payment is material to the Group’s liquidity position, and the absence of this payment currently constitutes a material uncertainty regarding the Group’s ability to continue as a going concern. Due to the non-payment, the Group furthermore was not able to reopen other letters of credits. The banks have subsequently reserved their right to not allow further utilizations of the facilities which could, when executed, negatively impact the Group’s liquidity position and outlook. The Group is in discussions with the banks to come to a solution but the discussions have not been finalized yet. The Group is exploring options to find an alternative LC or other working capital provider however to date has not found such solution. Although the Group is putting significant effort in finding a strategic investor and/or obtaining refinancing, the above disclosed uncertainties, both individually and in aggregate, create a material uncertainty regarding the Group's ability to continue as going concern. Regarding the operational outlook and assuming the Group successfully attracts short-term liquidity, the primary focus will be on production and delivery of the existing order book in combination with a continuation of right sizing the cost base of the organization. The Group implemented cost measures, including through an FTE reduction, which are expected to result in lower operational expenditures for 2025. The Group will continue to closely monitor these measures and subsequent liquidity impact as this is vital for its ability to continue as a going concern. 2.4 SUMMARY OF MATERIAL ACCOUNTING POLICIES Functional and presentation currency The Group’s consolidated financial statements are presented in euros, which is also the Parent’s functional currency. The financial statements of entities that have a functional currency different from that of the Parent ("foreign operations") are translated into euros as follows: ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 66 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Group companies: • Foreign currency differences resulting from translation of subsidiaries are recognized in other comprehen- sive income. Transactions and balances: • Assets, equity and liabilities - at the closing rate at the date of the statement of financial position. • Income and expenses - at the average rate of the period (as this is considered a reasonable approximation of the actual rates prevailing at the transaction dates). CURRENT VERSUS NON-CURRENT CLASSIFICATION The Group presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is current when it is: • Expected to be realized or intended to be sold or consumed in the normal operating cycle • Held primarily for the purpose of trading • Expected to be realized within twelve months after the reporting period Or • Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period A liability is current when: • It is expected to be settled in the normal operating cycle • It is held primarily for the purpose of trading • It is due to be settled within twelve months after the reporting period Or • There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period Deferred tax assets and liabilities are classified as non-current assets and liabilities. FINANCIAL INSTRUMENTS AND FAIR VALUE This section relates to all financial assets and financial liabilities of the Group, including financial instruments associated with the Group’s hedge accounting. FAIR VALUE Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly trans- action between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability or, in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by the Group. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are catego- rized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities; • Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measure - ment is directly or indirectly observable; • Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measure - ment is unobservable. For assets and liabilities that are recognized in the financial statements at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing catego- rization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. FINANCIAL INSTRUMENTS 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. Derivatives held by the Group are classified and recorded at fair value. All other financial instruments on the balance sheet are classified and recorded at (amortized) cost. Other financial assets are initially measured at fair value plus transaction costs and subsequently at amortized cost less impairments based on the expected credit loss (“ECL”) approach. Fair value of trade receivables and cash and cash equivalents approximates the carrying amount due to the short duration. Other financial liabilities are initially measured at fair value less transaction costs and subsequently at amortized cost. Fair value of current financial liabilities approximates the carrying amount due to the short duration. CLASSIFICATION The Group classifies its financial instruments either at: • Fair value through profit or loss (“FVPL”); or • Amortized cost. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 67 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS The classification of financial assets is dependent on the business model of the contractual terms of the cash flows and the terms and conditions of the financial assets. Gains and losses on financial assets classified and subsequently measured at FVPL shall be recorded in the profit or loss. MEASUREMENT The Group measures financial assets at initial recognition at fair value plus transaction costs. The transaction costs of financial assets classified at FVPL are expensed in profit or loss at initial recognition. DEBT INSTRUMENTS Subsequent measurement of debt instruments depends on the classification of the debt instruments by the Group. The Group measures its debt instruments as follows: • Amortized cost: Interest income from these financial assets is included in finance income using the effec- tive interest method. • FVPL: A gain or loss is subsequently measured at FVPL and gains or losses are recognized in profit or loss and presented net within other gains and losses for the period in which it arises. FINANCIAL LIABILITIES – EMBEDDED DERIVATIVES The Group measures its embedded derivatives at FVPL. FINANCIAL LIABILITIES – NOT DERIVATIVES The Group measures its financial liabilities at amortized cost using the effective interest method. IMPAIRMENT The Group assesses on a forward-looking basis the ECL associated with its debt instruments carried at amor- tized cost. The Group implements one ECL approach for financial assets (the simplified ECL approach). The Group applies the simplified ECL approach to qualifying trade receivables and IFRS 15 contract assets. The Group determines its expected credit losses on trade receivables based on the historical weighted average credit losses on trade receivables that the Group holds, while incorporating any known information which could affect credit losses in the future. These weights are based on the duration of the trade receiv- ables (current number of days outstanding). The Group will use the historical default information of trade debtors in order to attempt to have an unbiased probability weighted amount of the expected credit losses. Expected credit losses are calculated by multiplying the probability of default based on historical data, loss given default and the current lifetime of the trade receivable. This leads to a weighted ECL based on debtors with an outstanding receivable of: • 0-30 days • 31-60 days • 61-90 days • Longer than 90 days This practical application of the lifetime ECL on trade receivables is labeled as the provision matrix by the Group. The provision matrix is used to form the provision for bad debtors and thus impair trade receivables. OFFSETTING OF FINANCIAL INSTRUMENTS Financial assets and financial liabilities are offset and the net amount is reported in the consolidated state- ment 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. REVENUE REVENUE FROM CONTRACTS WITH CUSTOMERS In determination of its recognition of revenue, the Group applies the 5-step model in line with IFRS 15. Revenue is recognized if the Group has entered into a contract with a customer in which the performance obligations can be identified, the terms of the transaction are clear, and it is probable that the customer will pay. Revenue is recognized for each contract. If a contract involves several performance obligations, revenue is separately attributed to the performance obligations based on relative stand-alone selling prices. Revenue is recognized over time if the customer simultaneously receives and consumes the benefit of the Group’s performance or if the Group produces an asset without alternative use which it is contractually obligated to deliver to the customer and for which the Group has an enforceable right to payment for performance completed to date. Revenue is recognized at a point in time if it does not meet the criteria to be satisfied over time. If a contract contains a significant financing component, the Group adjusts the revenue accordingly. This is not done if the time between the fulfilment of the performance obligation and the payment of the consider- ation is less than one year. If the results from a contract cannot be determined reliably, contract revenue is only recognized to the extent of costs incurred. Expected contract losses are recognized immediately in the statement of profit or loss. In measuring the amount of provisions for losses, the Group proceeds on the basis of the economic benefits expected to be received compared with the unavoidable costs of the contract. The Group has three main types of revenue from contracts: 1 Contracts for the sale of zero emission buses: the Group sells zero emission buses and related charging systems. The Group negotiates with each customer according to the needs of the customer and charges a transaction price based on the type and number of buses ordered. Contracts are fulfilled, on average, within six to twelve months. Revenue for sales of zero emission buses is recognized over time when the Group produces a bus without an alternative use which the Group is contractually obligated to deliver and for which the Group has an enforceable right to payment for performance completed to date. The revenue ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 68 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS relating to work in progress is recognized in the statement of profit or loss based on percentage of comple- tion of the project. The stage of completion is assessed by reference to the proportion of costs recorded in relation to the total expected costs to the extent that the costs incurred are representative of the prog- ress made in the transfer of goods/services to the client. Inefficiencies are disregarded in determining the stage of completion. In-progress contracts are recorded as contract assets. Although the buses the Group manufactures will always maintain a certain level of customization, the Group’s product design and processes reached a more standardized state. Due to this (product) develop- ment, Ebusco is now able to redirect the bus for another use without incurring significant costs to rework the asset. For such bus contracts, the Group recognizes revenues at a point in time when control of the bus transfers to the customer, which is generally upon customer acceptance. The assessment of whether an asset has an alternative use to the Group is made at contract inception. In-progress contracts for which revenue is recognized at a point in time are recorded as work-in-progress (under inventories) to the extent the costs are recoverable. 2 Contracts for charging systems and ancillary services and goods: the Group also sells items and services in addition to its zero emission buses. These goods and services consist of additional parts for the Group’s buses or represent services, including repair and maintenance services, and service type warranty, which support the customer’s use of zero emission buses sold by the Group. Revenue is recognized either at a point in time or over time based on the nature of the good or service in accordance with the Group’s revenue recognition policy. Typically, spare parts and charging systems are recognized at a point in time whilst services are recognized over time. If applicable, service-type warranties are accounted for as separate performance obligations in accordance with IFRS 15 and are recorded as contract liabilities (as appro- priate) and recognized as the Group performs its obligation. 3 Contracts from the sale of energy storage systems: as part of the Group’s vision of a complete EV ecosystem from start to finish, it has developed both Energy Storage Systems (ESS) and Mobile Energy Containers (MEC). Whereas the ESS can be used for grid alignment, the MECs can be used for hybrid electric barges. Revenue is recognized at a point in time for both the ESS as the MEC. For financial year 2024, revenue is recognized solely for the sale of ESS. The accounting policies regarding trade receivables, contract assets, and contract liabilities are set out in the corresponding notes (refer to Note 15 for trade receivables and below for contract assets and liabilities). TRANSACTION PRICE AND STAND-ALONE SELLING PRICES Transaction prices are determined per individual contract, based on goods and services ordered by each customer. Payment terms vary per contract. The performance obligation that significantly affects the deter- mination of the transaction price is the supply of zero-emission buses. Revenue is either recognized at a point in time when control of the buses is transferred to the Group’s customers or recognized over time. CONTRACT ASSETS AND CONTRACT LIABILITIES The Group recognizes a contract asset for services or goods transferred to a customer to which the Group has a right to receive consideration. The Group reclassifies contract assets to trade receivables when perfor- mance obligations are satisfied and the right to consideration becomes unconditional. The Group recognizes a contract liability when a payment is received from a customer or is due before the Group transfers the related goods or services. Contract liabilities are recognized as revenue when the Group performs its obligations. Contract assets and receivables generally have a term of less than 12 months. SEGMENT REPORTING An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses. The operating results of each segment are regularly reviewed by the entity’s Chief Operating Decision Maker (“CODM”) in order to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. The Group reports separate information about an operating segment if the reported revenue, profit or loss or assets exceed 10 per cent of the total of the Group, or if the Management Board believes that information about the segment would be useful to the users of the financial statements. EMPLOYEE BENEFIT EXPENSES Employee benefits are all forms of consideration given by the Group in exchange for services rendered by employees or for the termination of employment. Short-term employee benefits are employee benefits (other than termination benefits) that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees rendered the related service. Post-employment benefits are employee benefits (other than termination benefits and short-term employee benefits) that are payable after the completion of employment. 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. When the grant relates to assets, it shall be presented in the statement of financial position by deducting the grant in arriving at the carrying amount of the asset. SHARE-BASED PAYMENTS Equity-settled share-based payments to employees are measured at the fair value of the equity instruments at the grant date. The fair value is included in employee benefit expenses in the vesting period during which the expected employee services are received. The same amount is credited to shareholders' equity. The ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 69 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS cumulative expenses 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. Ebusco has opted to recognize the increase in equity as a result of the equity-settled share-based payment transactions in other capital reserves. Service 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 the Group’s best estimate of the number of equity instruments that will ultimately vest. No expenses are recognized for awards that ultimately do not vest because service conditions have not been met. PENSIONS The Group has a defined contribution plan (which is capped at an annual pensionable salary of €115).For the defined contribution plan, the group pays contributions to a public or privately administered pension insur- ance plan on a mandatory or contractual basis. The Group has no legal or constructive obligations to pay additional contribution if the fund does not hold sufficient assets to pay all employees the benefits relating to the employee service in the current and prior periods. The contribution is recognized as employee benefit expense when it is due. Prepaid contribution is recognized as an asset to the extent that a cash refund or a reduction in the future payments is available and can be contractually enforced. OTHER OPERATING EXPENSES Other operating expenses are recorded on a historical basis and allocated to the reporting period when they occur. FINANCE (INCOME)/EXPENSE The costs are determined on a historical basis and allocated to the reporting period to which they relate. INCOME TAX CURRENT INCOME TAX Current tax is the expected tax payable/receivable on the taxable income or loss for the year, using appli- cable tax rates at the end of the reporting period, and any adjustment to tax payable/receivable in respect of previous years. DEFERRED INCOME TAX Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets are recognized for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Future taxable profits are determined based on the reversal of relevant taxable temporary differences. If the amount of taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future taxable profits, adjusted for reversals of existing temporary differences, are considered, based on the business plans for individual subsidiaries in the Group. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized; such reductions are reversed when the probability of future taxable profits improves. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date, and reflects uncertainty related to income taxes, if any. The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. The Group offsets deferred tax assets and deferred tax liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered. EARNINGS PER SHARE The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. The calculation for the earnings per share is as follows: • Basic EPS is calculated by dividing the profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year. • Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordi- nary shares. PROPERTY, PLANT AND EQUIPMENT All items of property, plant and equipment (“PPE”) are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Items of PPE are depreciated over their useful life on a straight-line basis. Any change in the useful life and depreciation period shall be accounted for as a change in accounting estimates. PPE is tested for impairment whenever events or changes in circumstances occur indicating that the carrying amount may not be recov- erable. PPE includes equipment and office inventory, transportation and assets under construction. The estimated useful life of the aforementioned PPE is between 3 and 5 years. Assets under construction refer to assets which are not available for use yet and therefore not depreciated. For right-of-use assets reference is made to the accounting policy of Leases. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 70 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS INTANGIBLE ASSETS The intangible assets for the Group consist of goodwill, development assets, software and assets under construction. BUSINESS COMBINATIONS AND GOODWILL Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets acquired at the acquisition date. All business combinations are accounted for by applying the acquisition method as at the acquisition date. Goodwill is measured as the difference between: • the aggregate of the (a) the value of the consideration transferred (generally at fair value), (b) the amount of any non-controlling interest and (c) in a business combination achieved in stages, the acquisition-date fair value of the acquirer’s previously held equity interest in the acquiree, and • the net of the acquisition-date fair value of the identifiable assets acquired and the liabilities assumed. Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not amortized but tested annually for impairment. DEVELOPMENT ASSETS Development assets are internally generated intangible assets. The costs capitalized consist of salaries, materials and services directly attributable to the development activities. Development expenditures on an individual project are recognized as an intangible asset when the Group can demonstrate: • The technical feasibility of completing the intangible asset so that the asset will be available for use or sale • Its intention to complete and its ability and intention to use or sell the asset • How the asset will generate future economic benefits • The availability of resources to complete the asset • The ability to measure reliably the expenditure during development Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortization and accumulated impairment losses. Amortization of the asset begins when development is complete and the asset is available for use. It is amortized over the period of expected future benefit. During the period of development, the asset is tested for impairment annually. Impairment assess- ments have been performed and no indications of impairment have been identified. Research costs are expensed as incurred. AMORTIZATION AND IMPAIRMENT TESTING Goodwill is subject to annual impairment testing, irrespective of whether indications of impairment exist. Goodwill allocated to a cash-generating unit (“CGU) is impaired when its carrying amount of the cash-gener- ating unit exceeds the recoverable amount. The recoverable amount is, in turn, defined as the higher of the fair value less cost of disposal and the value in use; where the value in use is the present value of the future cash flows. In the value in use model estimates of future cash flows shall only include projections of cash inflows from the continuing use of the asset. The fair value less cost of disposal shall be determined in accor- dance with the fair value accounting policy. Any intangible asset not yet available for use must be tested annually because its ability to generate suffi- cient future economic benefits to recover its carrying amount is usually subject to greater uncertainty before the asset is available for use than after it is available for use. For intangible assets which form part of the assets within a CGU the procedures relevant to testing a CGU as set out above apply. Intangible assets with finite lives are amortized over the useful economic 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 for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. The intangible assets are amortized over a period of 3-5 years. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of profit or loss. INVESTMENT IN ASSOCIATES ASSOCIATES Associates are all entities over which the group has significant influence but not control or joint control. This is generally the case where the group holds between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting (see below), after initially being recognized at cost. On acquisition of the investment, any difference between the cost of the investment and the entity’s share of the net fair value of the investee’s identifiable assets and liabilities is accounted for as follows: a Goodwill relating to an associate or a joint venture is included in the carrying amount of the investment. b Any excess of the entity’s share of the net fair value of the investee’s identifiable assets and liabilities over the cost of the investment is included as income in the determination of the entity’s share of the associate or joint venture’s profit or loss in the period in which the investment is acquired. EQUITY METHOD Under the equity method of accounting, the investments are initially recognized at cost and adjusted there- after to recognize the group’s share of the post-acquisition profits or losses of the investee in profit or loss, and the group’s share of movements in other comprehensive income of the investee in other comprehensive income. Dividends received or receivable from associates and joint ventures are recognized as a reduction in the carrying amount of the investment. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 71 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Where the group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including any other unsecured long-term receivables, the group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the other entity. Unrealized gains on transactions between the group and its associates and joint ventures are eliminated to the extent of the group’s interest in these entities. Unrealized losses are also eliminated unless the transac- tion provides evidence of an impairment of the asset transferred. Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency with the policies adopted by the group. The carrying amount of equity-accounted investments is subject to impairment testing. After application of the equity method, the Group determines whether it is necessary to recognize an impairment loss on its investment in its associate or joint venture. At each reporting date, the Group determines whether there is objective evidence that the investment in the associate or joint venture is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate or joint venture and its carrying value, and then recognizes the loss within ‘Share of profit of an associate and a joint venture’ in the statement of profit or loss. NON-CURRENT FINANCIAL ASSETS Financial assets are initially recognized at fair value and subsequently measured at amortized cost less impairments based on the general expected credit loss approach. The Group’s non-current financial assets consist of long-term deposits. INVENTORIES Inventories are assets sold in the ordinary course of business. Inventories are measured at the lower of cost and net realizable value. The cost price of the inventory is determined based on the first-in, first-out method. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale. TRADE RECEIVABLES Trade receivables are classified at amortized cost, initially recognized at transaction price and subsequently measured at amortized cost less impairments based on the simplified expected credit loss (ECL) approach for trade receivables that do not contain a significant financing component. Customer credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on individual credit limits which are defined in accordance with this assessment. Outstanding customer receiv- ables and contract assets are regularly reviewed. The Group applies the simplified expected credit loss approach using a provision matrix based on historic inputs to determine the expected losses. This approach takes into account forward looking information that might have an impact on the way the trade receivables will be settled in the future. The calculation reflects the probability-weighted outcome, the time value of money and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic condi- tions. Generally, trade receivables are written-off if past due for more than one year and which are not subject to enforcement activity. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. The Group evaluates the concentration of risk with respect to trade receivables and contract assets as low, given its customers profile. OTHER CURRENT FINANCIAL ASSETS Other receivables and accrued assets are initially recognized at fair value and subsequently measured at amortized cost less impairments based on the simplified expected credit loss approach. CASH AND CASH EQUIVALENTS The Group considers cash and cash equivalents the cash at bank and in hand, bank balances and deposits with terms of less than three months. Due to the short term and the fundamentally lower credit risk of the financial instrument, it is assumed that their fair values are equal to the carrying amounts. IMPAIRMENT OF NON-FINANCIAL ASSETS Further disclosures relating to impairment of non-financial assets are also provided in the following accounting policies: • Property, plant and equipment • Intangible assets, including goodwill • Right-of-use-assets • Significant accounting judgements, estimates and assumptions (note 3) The Group assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group 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 and 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 is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calcu- lations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators. The Group bases its impairment calculation on most recent budgets and forecast calculations, which are prepared separately for each of the Group’s CGUs to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of five years. A long-term growth rate is calculated and applied to project future cash flows after the fifth year. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 72 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS 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 have decreased. If such indication exists, the Group estimates the asset’s or CGU’s recoverable amount. A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognized. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the statement of profit or loss. The Group assesses where climate risks could have a significant impact, such as the introduction of emis- sion-reduction legislation that may increase manufacturing costs. Although the introduction of such legis- lation would also result in a higher demand for the Group, these risks in relation to climate-related matters would be included as key assumptions where they materially impact the measure of recoverable amount. These assumptions have been included in the cash flow forecasts in assessing value-in-use amounts. EQUITY Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of the ordinary shares are netted, net of tax, from the proceeds. The Group evaluates its equity instruments, including its preferred shares. Certain instruments contain aspects which would require their classification as either liabilities or compound instruments which would contain both equity and liability components, including whether or not the Group has a contractual obligation to deliver cash or financial asset to another party. Equity classification is only appropriate if the Group has an unconditional right to avoid delivering cash or other financial instruments. NON-CURRENT FINANCIAL LIABILITIES (NON-DERIVATIVES) Financial liabilities (non-derivatives) are initially measured at fair value less transaction costs and subse- quently measured at amortized cost. LEASES (THE GROUP AS A LESSEE) The Group assesses whether a contract is or contains a lease at the inception of the contract to determine whether an asset is identifiable, and the lessee has control to direct its use, and receives all economic bene- fits related to the asset. The Group recognizes a right-of-use asset (“ROU asset”) and a corresponding lease liability with respect to all lease arrangements in which it is a lessee. The lease liability is initially measured by calculating the present value of all future lease payments, discounted by the incremental borrowing rate. All future lease payments are fixed in nature with exception of yearly indexations. The interest on the lease liability for each period from the discount rate is recognized in the profit or loss statement for the year. At initial recognition, the ROU asset amounts to the initial lease liability adjusted for any initial direct costs or the expected costs for dismantling. In case of changes in the lease term or other conditions, the Group will reassess the discount rate and the remaining lease payments. The Group shall remeasure the carrying amount of the lease liability to reflect a reassessment or lease modification, using a revised discount rate, if any. ROU assets are depreciated on a straight-line basis over the shorter of the lease term and useful life and tested for impairment whenever events or changes in circumstances indicates that the carrying amount may not be recoverable. PROVISIONS Provisions are recognized when the Group 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. The expense relating to a provision is presented in the statement of profit or loss net of any reimbursement. By nature, provisions include uncertainty and if the actual outcome differs from the assumptions, the estimated provision will be revised, and this could have an effect on the financial position and results of the Group. PROVISION FOR WARRANTIES Provisions for warranties are recognized when: (a) the Group has a present legal or constructive obligation as a result of past events; (b) it is probable that an outflow of resources will be required to settle the obligation; and (c) the amount can be reliably estimated. Assurance-type warranties are not distinct within customer contracts. Service-type warranties are accounted for as separate performance obligations in accordance with IFRS 15 and are recorded as contract liabilities (as appropriate) and recognized as the Group performs its obligation. Provisions related to assurance-type warranties are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. PROVISION FOR ONEROUS CONTRACTS If the Group has a contract that is onerous, the present obligation under the contract is recognized and measured as a provision. However, before a separate provision for an onerous contract is established, the Group recognizes any impairment loss that has occurred on assets dedicated to that contract. An onerous contract is a contract under which the unavoidable costs (i.e., the costs that the Group cannot avoid because it has the contract) of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it. The cost of fulfilling a contract comprises the costs that relate directly to the contract (i.e., both incremental costs and an allocation of costs directly related to contract activities). RESTRUCTURING PROVISIONS Restructuring provisions are recognized only when the Group has a constructive obligation, which is when: (i) there is a detailed formal plan that identifies the business or part of the business concerned, the location and number of employees affected, the detailed estimate of the associated costs, and the timeline; and (ii) the employees affected have been notified of the plan’s main features. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 73 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS CURRENT FINANCIAL LIABILITIES (NON-DERIVATIVES) The financial liabilities (non-derivatives) are initially measured at fair value and subsequently at amortized cost. The fair value of the current financial liabilities approximates the book value due to its short-term nature. CURRENT FINANCIAL LIABILITIES (DERIVATIVES) The financial liabilities (derivatives) are initially measured at fair value and subsequently through profit or loss. RELATED PARTY TRANSACTIONS A related party is a person or an entity that is related to the reporting entity: • A person or a close member of that person’s family is related to the Group if that person has control, joint control, or significant influence over the Group or is a member of its key management personnel. • An entity is related to the Group if, among other circumstances, it is a parent, subsidiary, fellow subsidiary, associate, or joint venture of the Group, or it is controlled, jointly controlled, or significantly influenced or managed by a person who is a related party. A related party transaction is a transfer of resources, services or obligations between a reporting entity and a related party, regardless of whether a price is charged. The Group discloses the nature of the related party relationship as well as information about the transac- tions and outstanding balances necessary for understanding of the potential effect of the relationship on the financial statements. These disclosures are made separately for each category of related parties. Key management personnel are those persons having authority and responsibility for planning, directing, and controlling the activities of the Group, directly or indirectly, including any directors (whether executive or otherwise) of the Group. COMMITMENTS, CONTINGENT ASSETS AND LIABILITIES Contingent liabilities and assets do not meet the recognition criteria. The Group discloses a contingent liability if there is a possible obligation that arises from past evens and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events that are not wholly within the control of the Group. The liability is not recognized because it is not probable that an outflow of resources will take place to settle the obligation, or the amount of the obligation cannot be measured with sufficient reliability. When the possibility of an outflow of resources is remote, no contingent liability is disclosed. The Group discloses a contingent asset if there is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. The asset is only disclosed when the possibility of an inflow of resources is probably. 2.5 CHANGES IN ACCOUNTING POLICIES The Group has consistently applied the accounting policies to all periods presented in these Consolidated Financial Statements. A number of new standards and amendments are effective as from 1 January 2024. They do not have a material effect on the Group’s Consolidated Financial Statements. These new standards and amendments are as follows: • Supplier Finance Arrangements - Amendments to IAS 7 and IFRS 7 • Classification of Liabilities as Current or Non-current - Amendments to IAS 1 • Non-current Liabilities with Covenants - Amendments to IAS 1 3. SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS Below is a summary of the Group’s significant accounting judgements, estimates, and assumptions. REVENUE FROM CUSTOMER CONTRACTS In determining the stage of completion, the Group makes a critical estimate of the remaining cost. This esti- mation requires a consistent judgment (forecast) of the final outcome of the project, including costs to come and variance analyses of divergences compared with earlier assessment dates. Estimates are an inherent part of this assessment and actual future outcome may deviate from the estimated outcome. Historical expe- rience has also shown that estimates are, on the whole, sufficiently reliable. Estimates and judgements are made relating to a number of factors when assessing contracts. These primarily include the program of work throughout the contract period and an assessment of future costs after considering any changes in the scope of work. The Group reviews its estimates for its contracts with customers for buses, which are recorded under the percentage of completion method and, based on the data available to the Group, may record adjustments to its calculations as appropriate. Additionally, a significant estimate is applied in the determination of revenue relates to variable consider- ations inherent in certain customer contracts. Variable considerations mainly refers to maintenance and repair contracts and penalties arising from late deliveries which may impact the transaction price. The estimation of variable consideration requires judgment based on the assessment of expected outcomes, including consideration of historical experience, current contractual terms, and future events that may affect the amount of consideration to which the Group expects to be entitled. Changes in the estimate of variable consideration are recognized as adjustments to revenue in the period in which the estimate changes. Such adjustments may result from changes in circumstances, including changes in the Groups’ expectations regarding the likelihood or amount of variable consideration or changes in the underlying assumptions used in the estimation process. Reference is made to Note 5.1 for further details. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 74 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS IMPAIRMENT OF GOODWILL Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognized. Impairment losses relating to goodwill cannot be reversed in future periods. Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on the fair value hierarchy that categorizes the inputs of valuation techniques used to measure fair value into three levels. Level 3 input is a Discounted Cash Flow (“DCF”) model in which the cash flows are derived from the forecast for the next five years and includes the cash flows of the future investments that will enhance the performance of the assets of the CGU being tested. As the Group continues to invest significantly in the future growth, the fair value less costs of disposal model is considered the most reliable estimate of the price at which an orderly transaction to sell the asset would take place between market participants at the measurement date under current market conditions. The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes. These estimates are most relevant to goodwill and other intangibles with indefinite useful lives recognized by the Group. The key assumptions used to determine the recoverable amount, including a sensitivity analysis, are disclosed and further explained in Note 12. ESTIMATION USEFUL LIFE OF INTANGIBLE ASSETS The Group has made a significant estimate of the useful life of Development assets and Software. Uncertainty about this estimate could result in significant changes in the reported amount of amortization expenses and, subsequently, in result for the year. The estimated useful life of intangible assets is between 3 - 5 years. Reference is made to Note 12. PROVISION FOR WARRANTIES Typically the Group provides a 2 year assurance-type warranty on the buses that it sells to customers. The Group generally bears the risk that products/components will bear any manufacturing defect and/or defect in material. Back-to-back warranty from suppliers may only apply as additional assurance in case the Group can, for whatever reason, not fulfil their liabilities of the battery warranty to the customer. In addition, the Group generally has back-to-back guarantees in place for key spare parts. The production of zero emission buses is based on new technology for a relatively small customer base for which relatively limited historical information regarding warranty expenses is available, whether from the Group’s experience or based on similar publicly available information from industry peers. A warranty provi- sion is recognized for the products sold to which the warranty period has not yet expired. The Group included the best estimate of the projected costs to repair or replace items under warranties and recalls if identi- fied. These estimates are based on actual historical warranty claims incurred to date and an estimate of the nature, frequency and costs of future claims. These estimates are inherently uncertain given the relatively short history of sales and products and the lack of historical data for the full warranty period and for all prod- ucts. Changes to the historical or projected warranty experience may cause material changes to the warranty provision in the future. Further details are disclosed in Note 22. CONVERTIBLE BOND Determining the fair value of the embedded derivative within the convertible bond at the reporting date is considered a significant estimate. Significant assumptions used in the fair value analysis include the Group’s share price, volatility rate, risk-free rate and expected dividend yield. For further elaboration the Group refers to Note 19 in the financial statements. NET REALIZABLE VALUE The determination of the net realizable value of inventory is a critical accounting estimate that involves judgement, particularly in assessing whether inventory items are sold below cost mostly due to obsolescence or (customer specific) slow-moving stock. At each reporting date, the Group reviews its inventory to determine whether it is carried at the lower of cost and net realizable value. This assessment requires management to make assumptions regarding the expected value and applicability of its inventory. The Group has considered the impact of cancelled contracts and the results of inventory sales in estimating the net realizable value of inventory. Any changes in these assumptions could result in further adjustments to the carrying amount of inventory in future periods. 4. CAPITAL CONTRIBUTION IN ZERO EMISSION SERVICES (ZES) B.V. Ebusco Energy B.V. acquired an additional 0,17% of the voting shares of Zero Emission Services B.V., a provider of all-in concepts for emission-free inland shipping in the Netherlands, for an amount of €1,645 in May 2024. The Group accounts for this as an investment in an associate over which the Group has significant influence. The investment in ZES is accounted for using the equity method in the consolidated financial statements. At acquisition date, the additional investment of €1,645 to achieve a shareholding of 49,56% (2023: 49,39%) is accounted for at costs. Reference is made to Note 13 for subsequent measurement. 5. REVENUE, COST OF MATERIALS AND SEGMENT REPORTING The activities of the Group primarily consist of the sale of zero emission buses and ancillary services and goods, including charging systems, related to the electric vehicle ecosystem. 5.1 REVENUE REVENUE FROM CONTRACTS WITH CUSTOMERS The Group earns the majority of its revenue from its single performance obligation of the sale and supply of zero emission buses. The other primary performance obligations include a sale and supply of zero emission ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 75 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS bus chargers, a guarantee to provide a complete change of batteries, repair and maintenance services and extended warranty. Performance obligations for other services and goods, including supply of bus charging systems, are ancillary and supportive of the performance obligation of the sale and supply of zero emission buses. In addition, the Group earns revenue from its sale of energy storage systems. During the financial year ended 31 December 2024, the Group recognized a revenue reversal of €16 million, initially recorded in the financial year ended 31 December 2023, following the cancellation of certain bus contracts. These cancellations occurred as a result of the Group's failure to deliver the contracted buses within the required timeframe, giving the customers the right to terminate the contracts without further compensa- tion to the Group. In 2023, the Group evaluated the relevant contracts and concluded that revenue should be recognized over time for all of them, including those that were subsequently terminated. All contract termina- tions were accounted for prospectively as the terminations were formally communicated and agreed by both Ebusco and the respective customers in the second half of 2024. This resulted in negative revenue from the sale of zero emission buses for the year ended 31 December 2024. Finally, at 31 December 2023, the Group did not consider a significant reversal to be highly probable as it had not received any indication of contract cancellations. Furthermore, the Group does not a significant reversal to be probable in 2025 as, based upon its current contract assessments, all revenue from the supply of zero emission buses is recognized at a point in time which is upon customer acceptance. Finally, the Group recorded app. €18 million of revenues in the first half of 2024 which were reversed following the referred to contract cancellations. The breakdown of the revenue based on type is presented below: Revenue type(Unaudited) 2024 2023Revenue from zero emission buses – excluding reversals 12,850 92,115Reversed 2023 revenue from zero emission buses – cancelled contracts (16,156) -Revenue from charging systems and ancillary services and goods 13,726 10,127Revenue from energy storage systems 245 198Total 10,665 102,440 Revenue recognized over time pertains to contracts for the sale of zero-emission buses and related support services, where, upon contract assessment, the Group determined that the buses have no alternative use beyond their manufacture for the specific customer and that the Group possesses an enforceable right to payment under the contract. Conversely, revenue recognized at a point in time primarily arises from contracts for the sale of charging systems, spare parts, and energy storage systems. Additionally, revenue is recog- nized at a point in time for contracts involving the sale of zero-emission buses where, at contract inception, the Group assessed that the buses have an alternative use beyond the specific customer. Revenue recognition(Unaudited) 2024 2023Revenue recognized over time17,218 96,456Reversed 2023 over time revenue – cancelled contracts(16,156) -Revenue recognized at point in time9,603 5,984Total 10,665 102,440 As at 31 December 2024 the remaining performance obligations amount to €19.4 million (2023: €72.2 million). The Group estimates 12% (2023: 70%) of these anticipated revenues are expected to be recognized during the next 12 months. This revenue relates primarily to customer contracts for zero emission buses. In general the Group is exposed to penalty clauses for late delivery of the buses under its sales contracts. These penalties are generally capped at a percentage of the contractual selling price. As the Group experi- enced operational standstills due to its liquidity shortages during 2024 which resulted in delay in its delivery schedule, it could face penalty charges for late delivery. At 31 December 2024, the Group concluded that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Reference is made to Note 22 for further details of the provision recorded for assurance-type warranties under customer contracts. CONTRACT ASSETS AND CONTRACT LIABILITIES Contract assets / (liabilities) – 31 December(Unaudited) 2024 2023Contract assets (positive balance of work in progress)7,569 67,640Contract liabilities (negative balance of work in progress)(44,430) (18,939)Balance of contract assets and liabilities(36,861) 48,701 The contract assets balance as per 31 December 2024 is €7.6 million (2023: €67.7 million). Contract assets are measured taking account of expected credit losses in a way similar to the method used for trade and other receivables; no material expected credit losses haves been recorded for contract assets for the periods presented. Revenue received in advance (contract liability) as per 31 December 2024 amounts to €44.4 (2023: €18.9 million). The increase in the contract liabilities in 2024 is mostly explained by the upfront payment of one customer related to the Group’s energy storage systems. The Group expects to release the contract liabilities to profit or loss within 12 months after 31 December 2024. 5.2 COST OF MATERIALS Cost of materials are recognized and presented in the statement of profit or loss. These costs include amounts paid to the supplier for zero emission bus contracts, costs for parts included in zero emission bus contracts, transportation costs, import duties and warranty expenses. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 76 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS 5.3 SEGMENT REPORTING The Group has identified the Management Board, which consists of the CEO, CFO, COO and Founder as the chief operating decision makers (CODM). The operating results and performance of the total Group are regu- larly reviewed by the entity’s CODM in order to make decisions about resources to be allocated to the Group. Discrete financial information is available for the total Group. The total business of selling zero emission buses and ancillary revenue streams from these buses has been identified as a single operating segment. The following table summarises the Group’s geographical breakdown of its revenue, based on the location of the external customers for the periods indicated: Revenue – Geographical breakdown(Unaudited) 2024 2023DACH 112,561 48,959Nordics 2(9,365) 31,936Benelux4,062 17,186Spain846 1,427France2,614 2,932Rest of the World (RoW)(52) -Total10,665 102,440 1: DACH is an acronym for Germany (D), Austria (A) and Switzerland (CH). 2: Nordics is an acronym for Denmark, Sweden, Norway and Finland. In 2024, the revenues from external customers attributed to the entity’s country of domicile (the Netherlands) amounted to €4.0 million (31 December 2023: €15.8 million). LARGE CUSTOMERS In 2024, one customer generated 62% of the Group’s total revenue. In 2023, one customer (a different one) generated 12% of total revenue. 6. EMPLOYEE BENEFIT EXPENSES AND REMUNERATION KEY MANAGEMENT EMPLOYEE BENEFIT EXPENSES AND PENSIONS The table below gives a breakdown of the employee benefit expenses recognized in respect of short-term employee benefits and post-employment benefits: Employee benefit expenses (Unaudited) 2024 2023Wages and salaries 31,935 27,711Social security charges 4,948 4,586Other staff expenses 3,547 3,811Pension costs 1,907 1,573Car expenses 447 601Share based payments expenses (283) 185Total 42,501 38,467 Wages and salaries includes a research and development grant for the 3.0 bus for an amount of €600 (2023: €347) and various other grants of €51 (2023: €188). The increase in wages and salaries is mainly driven by the increase in average number of full-time employees (see table below). Car expenses relate to short-term rental expenses, fuel, insurance and repairs costs. Long-term car lease contracts for employees are included in Note 21 – Leases. Other staff expenses include employee costs that are not directly related to salaries and social security charges, including travel and related expenses. The average number of full-time employees for the period active within, respectively outside the Netherlands is as follows: Full-time employees(Unaudited) 2024 2023Active within the Netherlands466 476Active outside the Netherlands51 27Total517 503 SHARE BASED PAYMENTS The Group initiated one share-based compensation plan that will be settled in ordinary shares: a ‘One-off Appreciation and Retention Plan’. For the share-based compensation plan of the management board refer- ence is made to Note 6.1. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 77 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Under the One-off Appreciation and Retention Plan, certain senior employees have been granted Restricted Share Units (RSU’s) on 11 February 2022, which have vested on 11 February 2024 for the employees which were still employed by the Group on that date. The fair value of these share-based compensations, calculated on grant date, is based on Ebusco’s share price (observable input). Details of the share-based compensation plan during the year are as follows: (Unaudited) 2024 2023Restricted Share Units (RSU’s)Number of sharesFair valueNumber of sharesFair valueOutstanding at the beginning of the year15,57022,1017,00022,10Released during the year15,5703,861,250-Granted during the year----Outstanding at the end of the year--15,75022,10 The realization of the service conditions was (rounded) 93%. Dividends declared on the underlying shares while the RSU is unvested were nil, subsequently no amount has been deducted from the grant-date price of the Group’s share in estimating the fair value. 6.1 REMUNERATION KEY MANAGEMENT The Group’s key management consists of the CEO, Founder, CFO (a/i). and COO per 31 December 2024. During 2024 the former co-CEOs, CTO, CCO and HR Director also were part of the Group’s key management. Total remuneration for the Group’s key management amounted to €3,044 for 2024 (2023: €1,638). Key manage- ment are those persons having authority and responsibility for planning, directing and controlling the activi- ties of the entity (directly or indirectly) including any directors. The table below provides the remuneration of the Management Board for the years ended 31 December 2024 and 2023. The overview includes only the statutory Management Board members. (Unaudited) 2024 2023Base Pension Sever-Other Total Base Pension Sever-Other Totalsalaryand ance com- salaryand ance com- other pay- pensa-other pay- pensa-costsments tioncostsments tionPeter 406 88 - -494410 82 - -492Bijvelds 1(Founder)Christian 225 14 - 3242- - - --Schreyer 2(CEO)Paul van - - - --73 12 - 590Beers (CFO)Björn - - - --126 5 - 6137Krook (CFO)Jurjen 445 61 173 350893 21 - 25138Jongma 3(CFO)Bob 108 25 - -356292 47 - 18356Fleuren 4(COO)Roald 187 42 225 -435Dogge 5(COO)Total 1,199 228 398 6 1,830 994 166 - 54 1,213 1 Resigned as CEO on 31 August 2024 and entered into the function of President. 2 Appointed as CEO and member of the Management Board as from 24 October 2024 3 Resigned as CFO on 30 November 2024. 4 Resigned as COO on 14 May 2024 5 Appointed as COO and member of the Management Board per 1 July 2024 and resigned on 31 December 2024 BASE SALARY The base salary consists of the annual fixed salary. For the Group’s current CEO this also involves a prepay- ment for this first five months of 2025. PENSION AND OTHER COSTS The members of the Management Board have been granted a pension allowance equal to an amount of approximately 16% of their fixed base salary, excluding any allowances and bonus payments. Other benefits include 25 days of paid vacation leave per calendar year. Furthermore, the members of the Management Board receive a car allowance or company car in accordance with the Group’s car policy. The CEO furthermore receives a housing allowance. No other benefits are granted. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 78 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS SEVERANCE PAYMENTS The Group and its former CFO entered into a termination agreement which contained a termination fee equal to six months’ salary, holiday allowance and pension provision. The severance payment of €173 was trans- ferred in 2024. In addition, the Group’s former COO received a bonus prepayment of €225. The Group and the former COO agreed to use this amount as part of the agreed upon termination agreement. OTHER COMPENSATION Upon his installment, the Group’s current CEO was granted a signing bonus in the form of a share package. The package consists of 60.000 shares with a lock-up period of three years. The fair value of the signing bonus, calculated on grant date, is based on Ebusco’s share price (observable input) and is set at €0.89 per share. The initially granted package was issued on 24 October 2024 and will vest on 24 October 2027, only if the CEO is still in service of the Group on that particular date. The expected realization is set at 100%. No amount has been deducted from the grant-date price of the Group’s share price in estimating the fair value. 6.2 SUPERVISORY BOARD REMUNERATION EXPENSES Fixed Other compensation Total(Unaudited) 2023 (Unaudited) 2023 (Unaudited) 2023202420242024In euro1Derk Haank58,000 58,000 6,347 - 64,347 58,0002Carin Gorter50,000 50,000 2,400 1,650 52,400 51,6503Jeroen Drost47,000 47,000 600 600 47,600 47,6004Ruud Spoor31,333 47,000 2,250 1,800 33,583 48,8005Roelf de Boer54,000 55,750 2,700 2,400 56,700 58,1506Saskia Schatteman31,333 40,000 1,050 900 32,283 40,900Total 271,667 297,750 9,000 7,350 286,913 305,100 1 Derk Haank has been appointed as Chair of the Supervisory Board and member of the Nomination and Remuneration Committee 2 Carin Gorter has been appointed as Chair of the Audit Committee and member of the Supervisory Board 3 Jeroen Drost has been appointed as Chair of the Nomination Committee and member of the Supervisory Board 4 Ruud Spoor resigned as a member of the Supervisory Board as per 30 August 2024. 5 Roelf de Boer has been appointed as Chair of the Remuneration Committee, member of the Audit Committee and member of the Supervisory Board 6 Saskia Schatteman resigned as a member of the Supervisory Board as per 30 August 2024. 7. OTHER OPERATING EXPENSES Other operating expenses comprise general, distribution, marketing and other expenses. Other operating expenses (Unaudited) 2024 2023Cancellation settlement expenses 12,105 -General expenses 11,683 7,599Temporary employees 16,600 24,696Distribution expenses 5,080 5,247IT expenses 3,796 3,584Marketing expenses 255 1,156Facility expenses 3,661 4,088Office expenses 302 384Other expenses 2,050 3,664Total other operating expenses55,53250,418 Temporary employee expenses have been reclassified from employee benefit expenses to other operating expenses per 31 December 2024 The other operating expenses increased significantly due to the contractual (settlement) penalties the Group incurred as a result of delayed deliveries and subsequent contract cancellations during 2024. Other general expenses mainly include audit, advisory, insurance fees and changes to the provision for doubtful debts. The increase in general expenses is driven by the Group incurring additional advisory expenses relative to 2023. Marketing expenses are costs which include marketing and promotional costs and costs associated with making products available for delivery to customers. Facility expenses include costs for short-term rent, utilities, and other non-rent related expenses associated with the Group’s facilities. Office expenses include telecom expenses, office supplies, and subscriptions. IT expenses include software maintenance costs and license costs, as well as other IT services. Other expenses mainly consist of various expenses that are incurred as part of the Group’s daily operations. The Group has R&D expenditures of €53 recognized as an expense during the reporting periods (2023: €148). 8. FINANCE EXPENSES, NET Finance costs (Unaudited) 2024 2023Foreign currency exchange rate results, including (gains)/losses on derivatives (3,865) (220)Interest and similar expenses on loans and borrowings 7,368 1,697Interest income (79) (276)Revaluation of embedded derivative(1,200) (594)Interest on lease liabilities811 325Total 3,035 932 The foreign currency result is related to a currency swap to hedge the currency exposure of a sales contract in Norwegian Krone. The swap expired during the previous year and the Group was not able to renew the hedge. As the sales contract was cancelled during 2024 the gain has been recognized in the profit and loss. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 79 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS The Group issued convertible bonds in December 2023 which resulted in an increase in the interest expenses in 2024. For the revaluation of the embedded derivative the Group refers to Note 19. 9. INCOME TAX The major components of income tax expense for the years ended 31 December 2024 and 31 December 2023 are presented below. Income tax expense(Unaudited) 2024 2023Current tax (expense)/benefit:Relating to current year(198) (136)Adjustment prior year- -(198) (136)Deferred tax (expense)/benefit:Relating to origination and reversal of temporary differences(477) 927Relating to tax losses42,548 26,200Relating to limitation interest deduction - -Relating to (de)recognition DTA/unrecognized DTA(42,071) (41,480)Adjustment prior year and others - 14- (14,339)Income tax (expense)/benefit reported in the statement of profit or loss(198) (14,474) Deferred tax (expense)/benefit related to items recognized in equity during the year(Unaudited) 2024 2023Derivatives (OCI) - 332Share issuance expenses (equity)- (2,359)Deferred tax charged through equity- (2,027) The operations of the Group are subject to income taxes in the Netherlands and in the other countries where the Group is conducting a business. Ebusco Holding N.V. is the head of the Dutch fiscal unity for both income tax and VAT; all Dutch subsidiaries are part of the fiscal unity except ZES (49.56%). A reconciliation of the statutory income tax rate of the Netherlands to the effective income tax rate is as follows: Effective tax rate(Unaudited) 2024 2023Accounting profit before tax(200,573) (105,659)Domestic income tax rate25.8% 25.8%Theoretical income tax (expense)/benefit51,748 27,260Tax effect of:Deviating rates7 10Share of results of an associate- -Non-deductible expenses, tax exempt income and other permanent differences- -Benefit from previously unrecognized and unused tax losses - -Effect of (de)recognition DTA/unrecognized DTA(42,071) (41,480)Effect of unrecognized and unused tax losses- -Effect of permanent differences(9,882) (256)Other effects including adjustments prior year- (8)Total income tax (expense)/benefit(198) (14,474)Effective tax rate(0,1%) (13.7%) The enacted income tax rate in the Netherlands is set at 25.8%, similar as last year. The effect of permanent differences relate to the goodwill impairment (for which reference is made to Note 12) and the share issuance expenses (for which reference is made to Note 18). Non-deductible expenses, tax exempt income and other permanent differences in 2024 and 2023 mainly include the tax effect of tax exempt income from associates, non-deductible employee benefit expenses related share based payments, non-deductible advisory fees related to the acquisition of Zero Emission Services B.V. and interest deduction limitations for the convertible bond including changes in the accompa- nied embedded derivatives. The balances and movements for current tax and deferred tax for the years ended 31 December 2024 and 31 December 2023 are presented below: (Unaudited) As at As at 31 December Current income tax liabilities 31 December 20242023Income tax payable86 125 The deferred tax position of the Group as per 31 December 2024 and 31 December 2023 mainly relates to tax losses carried forward, limitation of interest deduction, right-of-use assets and lease liability positions resulting from the application of IFRS 16, the depreciation and the convertible bond. However, as a result of the Group’s history of losses the (net) deferred tax position has not been recognized in 2024. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 80 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS (Unaudited) As at As at 31 December Deferred tax assets31 December 20242023Property, plant and equipment73 58Right-of-use assets(3,720) (4,004)Derivatives- 110Lease liabilities4,060 4,136Tax losses carried forward87,270 44,722Limitation of interest deduction 743 173Convertible bond (embedded derivative)972 1,281Convertible bond (debt)(983) (1,335)Write-off deferred tax positions(88,415) (45,141)Total net deferred tax asset- - Changes in deferred tax assets and (liabilities), net(Unaudited) 2024 2023Carrying amount as at 1 January- 16,365Changes:Recognized in income statement- (14,339)Recognized in other comprehensive income- 332Recognized in share premium- (2,359)Other- 1Balance as at 31 December- - Tax losses carried forward available as at 31 December 2024 amount to €338.3 million (31 December 2023: €173.5 million) which can be carried forward indefinitely. Future taxable profits are determined based on the reversal of relevant taxable temporary differences. If the amount of taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future taxable profits, adjusted for reversals of existing temporary differences, are considered, based on the busi- ness plans for individual subsidiaries in the Group. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized; such reductions are reversed when the probability of future taxable profits improves. 10. EARNINGS PER SHARE The Group’s equity structure as per 31 December 2024 consists of 65,470,708 (2023: 64,039,380) ordinary shares with a nominal value of €0.05 (2023: €0.01). Earnings per share can be specified as follows: Share information (Unaudited) 2024Restated – 2023 2023Net profit attributable to ordinary shareholders (201,132) (119,159) (119,159)(in euro thousands)Weighted average number of ordinary shares for the period 18,602,40511,843,492 59,217,462Dilutive number of shares ---Total number of dilutive ordinary shares 18,602,40511,843,49259,217,462Basic earnings per share (in euro’s) (10.79)(10.06)(2.01)Dilutive earnings per share (in euro’s) (10.79)(10.06)(2.01)Basic earnings per share (in euro’s) (10.79)(24.39)(2.01)Dilutive earnings per share (in euro’s) (10.79)(24.39)(2.01) The 5 to 1 share consolidation has been considered for the full year weighted average number of ordinary shares calculation. The Group’s 2023 earnings per share has been restated following the 5 to 1 share consolidation which was effectuated on 30 October 2024. *** The Group’s 2023 earnings per share has been restated following the rights issue successfully completed on 20 November 2024. Upon joining the Group, the current CEO received a signing bonus in the form of a share package. The package consists of 60,000 shares with a vesting period of three years. The expected vesting is set at 100% and the effect of the expected exercise of the shares has not been included in the dilutive earnings per share as the earnings per share are loss making. At 31 December 2024, 10,620,154 dilutive number of shares relating to the convertible bond (2023: 5,888,000) have been excluded from the dilutive number of shares calculation as, due to the loss for the period, their effect would have been anti-dilutive. Further details on the convertible bond are set out in Note 19. In addition, the Group successfully completed a rights issue in November 2024 which involved the issuance of 43,853,031 new ordinary shares at an issue price of €0.8209 per share, generating gross proceeds of €36 million. Prior to the issuance, the total number of outstanding shares was 14,617,677. Following the comple- tion of the rights issue, the total number of shares outstanding increased to 58,470,708. The theoretical ex-rights price (TERP) was calculated at €1.589 per share, and the bonus factor derived from the rights issue is 41,25%. This results in an adjusted prior-period earnings per share (EPS) of €24.39 loss per share based upon the restated earnings per share following the 5 to 1 share consolidation. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 81 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS 11. PROPERTY, PLANT AND EQUIPMENT Equipment Trans-Assets under Totaland office portationconstructionProperty, plant and equipmentinventoryBalance as of 1 January 2024Cost 21,321 6,123 5,304 32,748Accumulated depreciation(5,573) (4,776) - (10,349)Net book value15,747 1,347 5,304 22,398Change in net book value:Additions1,026 45 2,086 3,157Disposals- - (18) (18)Transfer to inventory- - (7) (7)Transfer from assets under construction2,775 1,157 (3,932) -Depreciation(4,548) (620) - (5,167)Impairment(5,524) (139) (2,722) (8,385)Translation differences1 - (3) (2)Total changes(6,246) 433 (4,881) (10,683)Balance as of 31 December 2024 (Unaudited)Cost 19,622 7,186 426 27,234Accumulated depreciation(10,120) (5,396) (3) (15,519)Net book value 9,502 1,790 423 11,715Balance as of 1 January 2023Cost 9,709 4,668 2,280 16,796 Accumulated depreciation(2,577) (3,900) - (6,342) Net book value7,132 1,042 2,280 10,454Change in net book value:Additions11,351 946 4,079 16,376Disposals(60) (15) - (75)Transfer to inventory- (148) (191) (339)Transfer from assets under construction321 398 (719) -Depreciation(2,996) (874) - (3,870)Impairment- - (145) (145)Translation differences- (2) - (2)Total changes8,616 305 3,024 11,945Balance as of 31 December 2023Cost 21,321 6,123 5,304 32,748Accumulated depreciation(5,573) (4,776) - (10,349)Net book value15,747 1,347 5,304 22,398 The Group has performed an assessment with regard to its property, plant and equipment assets, espe- cially considering the transitioning from an Original Equipment Manufacturer (OEM) to an Original Equip- ment Designer (OED) model. This strategic shift involves Ebusco focusing on designing and engineering its buses while outsourcing the assembly process to contract manufacturers. The mentioned shift however also results in the Group no longer requiring part of its (specialized) manufacturing equipment and machinery. The assessment results in an impairment of €8.4 million. 12. INTANGIBLE ASSETS Goodwill Develop-Software Assets under TotalIntangible assetsment assetsconstructionBalance as of 1 January 2024Cost 39,258 15,029 1,832 6,872 62,991Accumulated amortization - (11,519) (1,584) - (13,103)Net book value 39,258 3,510 248 6,872 49,888Change in net book value:Additions - 587 - 610 1,197Transfer from assets under construction - 982 581 (1,564) -Amortization - (1,322) (131) - (1,453)Impairment (39,258) - - (4,996) (44,254)Total changes (39,258) 247 450 (5,950) (44,511)Balance as of 31 December 2024 (Unaudited)Cost 39,258 16,598 2,415 5,918 64,190Accumulated amortization (39,258) (12,841) (1,718) (4,996) (58,813)Net book value - 3,757 697 922 5,376Balance as of 1 January 2023Cost 39,258 14,793 1,832 3,267 59,161 Accumulated amortization - (10,324) (1,231) - (11,566)Net book value 39,258 4,469 601 3,267 47,595 Change in net book value:Additions - 236 - 4,697 4,933Transfer to inventory - - - (314) (314)Amortization - (1,195) (353) - (1,548)Impairment - - - (778) (778)Total changes - (959) (353) 3,605 2,293Balance as of 31 December 2023Cost 39,258 15,029 1,832 6,872 63,002Accumulated amortization - (11,519) (1,584) - (13,114)Net book value 39,258 3,510 248 6,872 49,888 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 82 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS 12.1 GOODWILL The goodwill recognized is related to the Pondus acquisition in 2021. The Group assessed the recoverable amount of the cash-generating unit (CGU) for annual goodwill impairment testing purposes. The CGU is the Ebusco business in total. Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use (VIU). For the annual goodwill impairment analysis of 2024, the Group determined the recoverable amount of the CGU by applying the VIU method (based on a discounted cashflow model) based on management-approved cash flow projections for a five-year period. A terminal growth rate of 2% was applied to estimate cash flows beyond this period, reflecting the expected long-term economic outlook and inflationary trends. Key assumptions used in the VIU model included: • The Group applied cashflow projections for a five-year period in its value-in-use calculation of which the first two years are derived from its business plan and for which growth assumptions have been included for the final three years. The growth rate assumptions are based upon published industry research. • Cashflows beyond the five-year period have been extrapolated using an estimated 2% growth rate, which is consistent with the growth rate disclosed in the 2023 annual report. Adjustments to growth estimates may be necessary in the future. • The Group assumes it is able to return to a gross margin between 30% and 35% as of FY2026. The assump- tion is based upon the recently designed Turnaround Plan. • The Group applied a discount rate of 20.42% and was estimated based on the weighted average cost of capital (pre-tax WACC) for the Group of 27.36%. As a result of the impairment test, the carrying amount, including goodwill, exceeded its recoverable amount of €71 million. Consequently, a goodwill impairment loss of €39 million was recognized in the consolidated statement of profit or loss for the period. The impairment is mostly the result of the Group’s revised (compared to previous periods) forecasted bus deliveries as the Group’s order book declined following the recent contract cancellations. Furthermore, the Group has been (and still is) faced with liquidity constraints which resulted in production standstills during 2024. The latter is negative impacting the further roll-out of the Group’s Turn- around Plan. Following the impairment, the carrying amount of goodwill is €0. SENSITIVITY ANALYSIS Management has performed sensitivity analyses on the key assumptions used in the VIU model. A further reduction in forecast EBITDA margins or an increase in the WACC could result in additional impairment. For example, a 1% increase in the WACC or a 0.5% reduction in forecast EBITDA margins would, respectively, result in a €3 million and €0 million decrease in the Group’s recoverable amount. 12.2 DEVELOPMENT ASSETS Development assets mainly refer to the design, construction and testing of a chosen alternative for the new low floor bus which is 100% electrically powered. This project was taken into use in 2021. The Group further- more finalized a cybersecurity certification program during 2024. 12.3 SOFTWARE Software mainly refers to the Group’s after sales and inventory management system, acquired from and developed by third party suppliers. In addition, the Group finalized the implementation of its Product Lifecycle Management (PLM) system in August 2024. 12.4 ASSETS UNDER CONSTRUCTION Assets under construction relate to the development of the Group’s energy storage systems, more specifi- cally to a Mobile Energy Container (MEC). These containers can be used in hybrid electric barges, providing a fully green alternative requiring significantly less fuel and emitting significantly less CO2 than conventional diesel-powered barges. The intangible assets which are not yet in use were tested for impairment. Due to the Group’s transition from an OEM to an OED model it impaired the intangible assets specifically related to its in-house production process (€ 1 million). The Group furthermore stopped the implementation of a new ERP system to which the remainder of the impaired amount relates. 13. INVESTMENT IN AN ASSOCIATE The Group increased its interest in Zero Emission Services (ZES) B.V. during 2024 to 49.56% (2023: 49.39%). ZES offers a complete range of products and services, based on interchangeable battery containers charged with renewable power, charging stations, technical support and an innovative pay per use concept for ship owners. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 83 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS The Group’s interest in ZES is accounted for using the equity method in the consolidated financial statements. At acquisition date, the investment is accounted for at costs, which is equal to the fair value of the Group’s investment in ZES. The following table illustrates the summarized financial information of the Group’s invest- ment in ZES: first quarter of 2025 which have been considered by the Group when determining the obsolescence reserve per 31 December 2024. The Group furthermore also planned to sell inventories not allocated to its current orderbook during 2024. The results of this offering have also been taken into account when determining the reserve per 31 December 2024. The write down of inventories predominantly relate to materials waiting to be used in the production process and to a lesser extent to goods under construction and spare parts. 15. TRADE RECEIVABLES (Unaudited) As at As at 31 December Trade receivables31 December 20242023Trade receivables 5,735 19,737Doubtful debtor provision (241) (452)Net trade debtors5,494 19,285 The doubtful debtor provision consists of a provision for individual debtors with objective evidence of impair- ment of €228 (2023: €392) and the allowance for expected credit losses €14 (2023: €60). In total €211 (2023: €145) has been released from the doubtful debtor provision in 2024 and no usage occurred (2023: €267). Trade receivables are non-interest bearing and are generally on terms of 30 to 90 days. Due to the short duration of the receivables (average less than 3 months) the fair value approximates the carrying value. Set out below is the information about the credit risk exposure on the Group’s trade receivables and contract assets using the provision matrix: 31 December 2024 (Unaudited)Contract Trade receivables - Days past dueassets<30 days 30-60 60-90 >91 days TotaldaysdaysExpected credit loss rate 0,0% 0,1% 0,1% 0,1% 0,3%Estimated total gross carrying amount at default 7,569 1,717 361 403 3,2525,735Expected credit loss - 1 1 1 1013 31 December 2023 Contract Trade receivables - Days past dueassets<30 days 30-60 60-90 >91 days TotaldaysdaysExpected credit loss rate 0,05% 0,1% 0,2% 7,7% 0,2%Estimated total gross carrying amount at default 67,640 15,099 2,536 106 1,99519,737Expected credit loss 30 12 5 8 560 Investment in an associate (Unaudited) 20242023Current assets 19,030 26,964Non-current assets 28,124 6,938Current liabilities (41,012) (28,733)Non-current liabilities (5) (13)Equity 6,137 5,156Group’s carrying amount of the investment (49.56%) 3,036 2,547Revenue from contracts with customers 509 106Cost of sales (919) (249)Administrative expenses (2,120) (1,977)Finance income 206 225Profit/(loss) before tax (2,324) (1,895)Income tax expense - -Profit/(loss) for the year (continuing operations) (2,324) (1,895)Other comprehensive income/lossTotal comprehensive income for the year (continuing operations) (2,324) (1,895)Group’s share of the loss (1,156) (871)In 2023 the Group had a 49.39% share in ZES. 14. INVENTORIES Inventories relate to trade goods ready for sale, materials waiting to be used in the production process and spare parts to service zero emission electric buses sold by the Group. (Unaudited) As at As at 31 December Inventories31 December 20242023Materials waiting to be used in the production process 78,649 96,154Goods under construction 50,441 -Spare parts 5,043 5,855Trade goods ready for sale 12,554 7,386Inventories, gross 146,678 109,395Allowance for obsolescence (29,010) (2,854)Inventories, net 117,677 106,541 The amount of write down of inventories recognized as an expense during 2024 amounts to €26 million (2023: €2.3 million). The Group has received contract cancellation notices during the final quarter of 2024 and the ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 84 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS 16. OTHER CURRENT ASSETS (Unaudited) As at As at 31 December Other current assets31 December 20242023Taxes and social securities1,821 4,301Derivatives- 94Other accrued assets 2,051 2,685Income tax receivable21 18 Total other current financial assets3,893 7,098 Due to the short duration of the non-derivative current financial assets the fair value approximates the carrying value. 17. CASH AND CASH EQUIVALENTS (Unaudited) As at As at Cash and cash equivalents31 December 202431 December 2023Cash at hand0 0Cash at bank2,399 27,918Total cash and cash equivalents 2,399 27,918 The majority of commercial banks where cash and cash equivalents are held have a credit rating in the A categories of Moody’s/S&P. No defaults occurred during the year and management does not expect any losses from non-performance by these counterparties. The risk of default of the counterparty is assessed to be low taking into account the credit rating. The resulting expected credit loss is estimated to be insignificant. Ebusco maintained bank guarantee credit facilities for a total of €40 million with ING Bank N.V. (€20 million), Coöperatieve Rabobank U.A. (€20 million) per 31 December 2024. At 31 December 2024 an amount of €16,067 of the bank guarantee credit facilities has been utilised at ING Bank N.V. related to outstanding letter of credit amounts (€9,675) and outstanding bank guarantees (€6,401). In addition, an amount of €9,391 has been utilised at Coöperatieve Rabobank U.A. for outstanding letter of credit amounts. Finally, the Group had a negative cash balance on one of its bank accounts per 31 December 2024 for an amount of €2.4 million which has been presented under the loans and borrowings for which it refers to Note 20. Ebusco has breached (a/o) payment obligations under the (uncommitted) bank guarantee credit facility. The banks have therefore demanded security rights being: • A right of pledge over the shares in Ebusco B.V. • A right of pledge over any receivables from Ebusco B.V. and Ebusco Holding N.V. • A right of pledge over any movable assets of Ebusco B.V. and Ebusco Holding N.V. • A right of pledge over any intellectual property rights held by Ebusco B.V. and Ebusco Holding N.V. Although a right of pledge over the shares in Ebusco B.V. was granted to the banks, the Group concluded that it retained control on Ebusco B.V. as the Group (by means of its Management Board) was (and still is) making the (key) operational and strategic decisions without interference of the banks. At 31 December 2023 an amount of €18,125 of the bank guarantee credit facilities has been utilised at ING Bank N.V. related to outstanding letter of credit amounts (€9,304) and outstanding bank guarantees (€8,821). In addition an amount of €19,181 has been utilised at Coöperatieve Rabobank U.A. for outstanding letter of credit amounts. 18. EQUITY 18.1 EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE GROUP For the purpose of the Group’s capital management, capital includes issued capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Group’s capital management is to safeguard the ability to continue as going concern and to provide return for share- holders and benefits to other stakeholders. The Group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants, if applicable. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes for managing capital during the years ended 31 December 2024 and 2023. ISSUED AND PAID IN ORDINARY SHARE CAPITAL The issued and paid in ordinary share capital amounts to €3,274 as at 31 December 2024 (31 December 2023: €640) based on 65,470,708 ordinary shares with a nominal value of €0.05. The Group performed a 5 to 1 share consolidation on 30 October 2024. The Group reported in its Annual Report 2023 64,039,380 ordinary shares with a nominal value of €0.01. Following the share consolidation this has been adjusted to 12,807,876 ordinary shares with a nominal value of €0.05. The Group issued 52,662,832 ordinary shares with a nominal amount of €0.05 during 2024. As a result, issued and paid in ordinary share capital increased by €2,633 and share premium by €52,936 (net of share issuance costs in the amount of €1,435 net of tax (tax rate: 25.8%). LEGAL RESERVES The Group has recorded cash flow reserve as a result of application of hedge accounting, linked to its foreign currency risk management policy as at 31 December 2024 of nil (2023: €3.7 million). ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 85 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS In addition, the Group has recorded a legal (non-distributable) reserve as required by Dutch law in respect of: • capitalized development assets excluding development assets acquired through business combinations (classified as Other reserve) as at 31 December 2024 of €4,603 (2023: €11,609) as required by Dutch law. • the remeasurement gain of €7,450 in 2021 as a result of remeasuring the carrying amount of its 20% invest- ment in Pondus associates’ at fair value. The share-based payment reserve of €3 (2023: €351) is used to recognize the value of equity-settled share- based payments provided to the Group’s CEO. Refer to Note 6 for further details of these plans. 18.2 NON-CONTROLLING INTERESTS The Group acquired the remaining 10% of the voting shares of Pondus Operations B.V. in February 2024 for an amount of approximately €152 from its minority shareholders. The non-controlling interest has subsequently been transferred to the Group’s retained earnings. The Group has subsequently merged Pondus Operations B.V. with Ebusco B.V. as per 1 July 2024. 19. CONVERTIBLE BOND In December 2023, the Group issued convertible bonds (‘the Bonds’) of €36.8 million to an entity managed by Heights Capital Management LLC, a global equity and equity-linked focused investor. The Bonds were issued at 93% par value with total net proceeds of €34.2 million and accrue interest at an annual rate of 5% payable quarterly in arrears. The bonds contain various conversion and redemption features. The Bonds have a maturity of three years, and were initially repayable in 12 quarterly repayments, of principal and interest over the three-year term, in either cash or in new ordinary shares at the Group’s option. The amortization schedule of the bonds has been adjusted during 2024 under the existing conditions of the bond agreement and three principal payments initially due in 2025 are scheduled to become payable on the final maturity date (21 December 2026). If in shares, the repayment is (since November 2024) at the lower of the conversion price of (post-share consoli- dation) €1,73602 (2023: €6.25 per share, which was pre-share consolidation) or a 10% discount to the volume weighted average price (VWAP) in the six-day trading period prior to election date. The bond agreement contains embedded derivatives in conjunction with an ordinary host debt facility. As a result, the convertible bonds are shown in the Consolidated Statement of Financial Position in two sepa- rate components, being ‘Convertible bond – debt’ and ‘Convertible bond – derivative’. At issuance, the total inception value was €36.8 million, being the principal amount of the Bonds, with the initial carrying amount of the debt liability element being the difference between the inception value of the convertible bond and the fair value at inception of the derivative element. Given the option of the bondholder to convert the bond at all times at their discretion for the conversion price, the debt and derivative liability elements have been classi- fied as current liabilities. The derivative element has been measured at fair value using a Black-Scholes option pricing model, which estimates the fair value based on the underlying asset's price, volatility, time to expiration, risk-free interest rate, and dividend yield. This therefore falls under Level 3 of the fair value hierarchy. The fair value at year-end was measured to be €3.8 million (2023: €5 million), resulting in a revaluation gain of the derivative being recognized of €1.2 million. The amount is recorded in the revaluation of the embedded derivative within the Finance expenses, net (Note 8). Significant assumptions used in the fair value analysis include the Group’s share price, volatility rate, risk- free rate and expected dividend yield (which was set at 0%). A share price of €1.74 per share per 31 December 2024 was used in determination of the fair value of the derivative element, an increase of 10% would have resulted in an increase in fair value by €622, while a reduction of 10% would have resulted in a decrease in fair value of €808. A volatility of 84.0% was used in the determination of the fair value of the derivative element per 31 December 2024, an increase of 5% would have resulted in an increase in the fair value by €305, while a reduction of 5% would have resulted in a decrease in the fair value by €309. The Group considers the determination of the fair value of the embedded derivative within the convertible bond, both at inception and at the reporting date, as a significant estimate. Convertible bond Convertible bond - debt Convertible bond – embedded derivativeBalance per 1 January 202327,920 5,560Interest expense and similar expenses241 -Principal repayments- -Revaluation of embedded derivative - (594)Balance per 31 December 202328,161 4,965Interest expense and similar expenses5,542 -Principal repayments(19,570) -Revaluation(51) (1,120)Balance per 31 December 2024 (Unaudited)14,079 3,766 20. LOANS AND BORROWINGS (LONG-TERM AND SHORT-TERM) FINANCIAL LIABILITIES Loans and borrowings consist of the following: (Unaudited) As at 31 December 2024 As at 31 December 2023Loans and borrowings Non-current Current Total Non-current Current TotalDebt to credit institutions - 5,359 5,359 - 1,348 1,348Debt to a third party - 17,845 17,845 - 33,126 33,126Total -23,204 23,204-34,474 34,474 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 86 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS DEBT TO CREDIT INSTITUTIONS The outstanding balance of €5,359 at 31 December 2023 (2023: €1,348) includes letter of credits entered into with Rabobank and ING. DEBT TO A THIRD PARTY For the debt to a third party reference is made to the convertible bond under Note 19. The following table sets out the reconciliation from the net cash flows from financing activities (excluding the convertible bond) with the financing positions of loans and borrowings as at 31 December 2024 and 2023. Debt to Debt to a Debt to Leases Totalcredit third party shareholdersinstitutionsBalance as at 1 January 2024 1,348 33,126 - 16,598 51,072Changes from financing cash flowsProceeds from loans and borrowings 5,359 - 5,000 - 10,359Repayment of loans & borrowings (1,348) (18,363) (5,000) - (24,711)Payment of lease liabilities - --(4,081) (4,081)Interest and similar expenses paid - (1,207)-- (1,207)Total changes from financing cash flows 4,011 (19,570) - (4,081) (19,640)Other changesAdditions and remeasurements - --11,301 11,301Disposals - --(518) (518)Finance expense/(income) - (1,253)-- (1,253)Interest and similar expense - 5,542 175 815 6,532Total liability-related other changes-4,289 175 11,598 16,062Balance as at 31 December 2024 (Unaudited) 5,359 17,845 175 24,115 47,495 Debt to Debt to a Debt to Leases Totalcredit third party shareholdersinstitutionsBalance as at 1 January 2023-486-7,761 8,247Changes from financing cash flowsProceeds from loans and borrowings 1,348 34,099 20,000 - 55,447Repayment of loans & borrowings - (486) (20,000) - (20,486)Payment of lease liabilities - - - (1,932) (1,932)Interest and similar expenses paid - - (1,076) - (1,076)Total changes from financing cash flows1,348 33,613 (1,076) (1,932) 31,953Other changesAdditions and remeasurements - (620) - 10,463 10,463Disposals - - - (20) (20)Finance expense/(income) - (594) 800 - 800Interest and similar expense - 241 276 325 601Total liability-related other changes - (973) 1,076 10,769 10,872Balance as at 31 December 2023 1,348 33,126 - 16,598 51,072 21. LEASES (Unaudited) As at As at 31 December Lease liability31 December 2024 2023Lease liability (non-current) 19,854 14,216Lease liability (current) 4,261 2,382Total 24,115 16,598 The Group has several lease agreements in which it acts as a lessee. The main leases concern a contract for office and manufacturing space in Deurne (the Netherlands) with a lease term of 5 years ending 30 September 2028 and a contract for the production facility in Rouen (France) with a lease term of 10 years ending 28 August 2033. The Group also entered into a five-year lease term for a production facility in Venray as per July 2024. The Group however decided that, due to the strategic shift from an OED to an OEM model, it would merge both Dutch facilities. The Group therefore decided to continue in Deurne and subsequently terminate the lease in Venray, which resulted in an impairment of €1 million. The Group also has lease contracts which consist of cars for company personnel. The lease term for the aforementioned lease contracts is between 4 and 5 years. No lease contracts for the personnel cars contain an extension option. New car lease contracts and remeasurements resulted in an increase of both the ROU asset and lease liabilities by €138 (2023: €218) and €134 (2023: €207) respectively. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 87 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS All lease contracts have fixed lease payments and are only adjusted for indexation. None of the lease agree- ments contain a termination option. Set out below are the carrying amounts of right-of-use assets recognized and the movements during the period: Right-of-use assets Land and buildings Cars TotalBalance as of 1 January 2024 15,523 380 15,902Change in net book value:Additions and remeasurements 11,166 139 11,305Disposals (420) (64) (484)Depreciation (3,302) (115) (3,417)Impairment (1,034) - (9,934)Total changes 6,409 (41) 6,369Balance as of 31 December 2024 (Unaudited) 21,930 340 22,270Balance as of 1 January 2023 6,902 353 7,255Change in net book value:Additions and remeasurements 10,245 218 10,462Disposals - (19) (19)Depreciation (1,624) (172) (1,796) Total changes 8,621 27 8,647Balance as of 31 December 2023 15,523 380 15,902 Set out below are the carrying amounts of lease liabilities (included under interest-bearing loans and borrow- ings) and the movements during the period the Group refers to Note 20: Lease liabilities (Unaudited) 2024 2023As at 1 January16,598 7,761Additions and remeasurements 11,301 10,463Accretion of interest 815 325Payments (4,081) (1,932)Disposal (518) (20)As at 31 December 24,115 16,598 The Group has elected not to recognize right-of-use assets and lease liabilities for short-term leases (less than 12 months) and low-value assets. Short-term (less than 12 months) and small value lease contracts are expensed in the statement of profit or loss and other comprehensive income on a straight-line basis over the lease term. The amount of expense incurred in 2024 is €1.8 million in total (2023: €2.8 million). The decrease is mostly related to the lease for the Group’s production facility in Venray which was still a short-term lease during 2023 and therefore not accounted as a lease under IFRS 16. The future cash outflows relating to leases that have not yet commenced are disclosed in Note 25: Commit- ments and contingencies (if applicable). For interest expenses on leases where the Group is a lessee, we refer to Note 8: Finance expenses, net. 22. PROVISIONS Details of the provisions are presented in the table below: (Unaudited) As at 31 December 2024 As at 31 December 2023Provisions Non-current Current Total Non-current Current TotalProvision for restructuring- 321 321 - - -Provision for warranties221 6,319 6,540 1,133 2,710 3,843Provision for contractual claims- 4,505 4,505 - 3,369 3,369Provision for onerous contracts- - - - 2,575 2,575Total 22211,145 11,3661,1338,654 9,787 As per below the movement schedule per provision is presented as well: Provision Provision for Provision for Provision Totalfor restruc-warrantiescontractual for onerous turingclaimscontractsProvision movement scheduleAs at 1 January- 3,843 3,369 2,575 9,787Additions and remeasurements 321 4,177 15,041 - 19,539Usage - (568) (11,505) - (12,073)Release (912) (2,399) (2,575) (5,886)As at 31 December (Unaudited) 321 6,540 4,505 - 11,366 PROVISION FOR ASSURANCE-TYPE WARRANTIES The Group issues diverse assurance-type warranties, wherein it typically assures the performance of deliv- ered buses and bus-related products and rendered services for a specified period. The estimated provision for these warranties encompasses anticipated expenses for contractual warranty claims, as well as anticipated costs for goodwill concessions and recall campaigns. These estimates are based on actual historical warranty claims incurred to date and an estimate of the nature, frequency and costs of future claims. These estimates are inherently uncertain given the relatively short history of sales and products and the lack of historical data for the full warranty period and for different type of buses. Changes to the historical or projected warranty experience may cause material changes to the warranty provision in the future. The utilization period of these warranties is contingent on the occurrence of warranty claims and may extend throughout the entire duration of the product warranties and the goodwill period. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 88 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS The main assumption is the expected warranty claims as a percentage of sales, which is based on the histor- ical warranty claims for buses of which the warranty period expired at 31 December 2024. A change of the claims as percentage of revenue by 0.25% would result in a change in the provision of €187. The effect of discounting is immaterial. In addition to the above, the Group recognizes additional provisions for warranty claims necessitating repairs on multiple buses across its driving fleet. The estimated provisions are inherently uncertain as these are determined and evaluated on a case-by-case basis based upon the readily information available. The amounts are subject to estimation and the actual costs can deviate from the estimated provision. PROVISION FOR CONTRACTUAL CLAIMS The provision for contractual claims mainly refers to direct damages resulting from late deliveries and product quality claims. Late deliveries may lead to reimbursement of costs to customers, when specified in customer contracts. Product defect claims may involve costs associated with replacing or repairing defective products, reimbursing customers for damages, or legal expenses related to resolving disputes. The provision is based on the contractual obligations and the amounts claimed by third parties. PROVISION FOR ONEROUS CONTRACTS The two customer contracts for which the Group recognized provisions for onerous contracts as per 31 December 2023 have been cancelled during the course of 2024. The provisions have therefore been released as per 31 December 2024. PROVISION FOR RESTRUCTURING On 31 December 2024 the Group announced a restructuring of its organization to optimize the organization and change to the Original Equipment Designer (OED) model. Approximately 102 FTE’s will be impacted by this restructuring. The restructuring provision contains employee termination benefits of which the related cash-outflows will mostly occur in the first half of 2025. 23. TRADE PAYABLES AND OTHER CURRENT FINANCIAL LIABILITIES The breakdown of the trade creditors and other current liabilities is as follows: (Unaudited) As at As at 31 December Trade payables and other current liabilities 31 December 20242023Trade payables 24,981 30,518Pension funds liabilities - 3Taxes and social securities 2,751 1,144Derivates - 81Other current liabilities 20,162 29,374Total 47,894 61,120 Trade payables are non-interest bearing and are on average settled on a 45-days term. Due to the short duration of the payables, the fair value approximates the carrying value. The other current liabilities mostly consists of contract cancellation settlements for which payment schedules have been agreed upon. Other current liabilities are non-interest bearing. 24. RELATED PARTY TRANSACTIONS The Group identifies a related party as a person or entity that is related to the Group. These include both people and entities that have, or are subject to, the influence or control of the Group. Note 2 provides information about the Group’s structure, including details of the subsidiaries and the holding company. The Group engages with its shareholders in certain related party transactions disclosed in this and other notes in these financial statements. The Group holds receivables and payables from its shareholders who represent related parties. Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 89 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Transactions and balances with related parties can be specified as follows: Year Purchases from Interest owed Amounts owed Amounts owed related partyby/(to) related by related to related partypartiespartiesEntity / person with significant influencePeter Bijvelds Holding Erp BV (Unaudited) 2024 - (122) - -2023 - - - -ING Bank N.V. (Unaudited) 2024 - (34) - -2023 - (947) - - SALES AND PURCHASES TO RELATED PARTIES Ebusco increased its share in Zero Emission Services B.V. during 2024 to 49.56% (2023: 49.39%) by means of a cash contribution of €1.645. At year-end all investments were settled with Zero Emission Services B.V. For more background reference is made to Note 4. Other purchases from related parties are within the normal course of the business. INTEREST OWED TO RELATED PARTIES During the normal course of business, the Group engages in transactions with ING Bank N.V., mainly related to the issuance of letters of credit and bank guarantees for which it incurs interest and similar expenses. All transactions are carried out at arms-length. During 2023 the Group incurred interest and similar expenses mainly related to the finance facility that was entered into and repaid during the respective financial year. Reference is made to Note 20: Loans and Borrowings. CONVERTIBLE BOND In December 2023, the Group issued convertible bonds (‘the Bonds’) of €36.8 million to an entity managed by Heights Capital Management LLC, a global equity and equity-linked focused investor. The Bonds have a maturity of three years and can either be repaid in new ordinary shares or in cash, which is at the Group’s option. Until date, all repayment installments have been performed in new ordinary shares, thereby making it a related party to the Group. During 2024 the Group issued 16,049,003 shares to repay the convertible bond. For further information reference is made to Note 19: Convertible bonds. SHAREHOLDER LOANS The Group entered into a shareholder loan through Peter Bijvelds Holding Erp B.V. (€3,500), ING Bank N.V. (€1,000) and VDVI B.V. (€500) for a total amount of €5,000. The respective shareholders have converted their shareholder loan into equity by means of participation in the Rights Issue at the issue price (€0,8209 per share). The incurred interest have been presented in the table above. The shareholder loan was carried out at arms-length. TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL For compensation of key management personnel of the Group reference is made to Note 6. Furthermore the Group entered into the shareholder loan with Peter Bijvelds as disclosed in the previous paragraph. 25. COMMITMENTS AND CONTINGENCIES PURCHASE COMMITMENTS The Group has open purchase orders for approximately €28.5 million. OTHER DISPUTES During December 2020, the Group delivered four buses to a customer, generating €2.0 million of revenues. After the transfer of control of the buses, the customer’s facility experienced fire damage and the buses were destroyed. The Group asserts that control and ownership of the buses was transferred before the event and the amounts receivable for the delivered buses are owed to the Group. The customer disputes the Group’s assertion and disputes the amount payable to the Group for the buses. The matter is still under dispute and the Group plans to pursue collection of the amount receivable. The outcome is neither probable nor estimable and no provision is recorded. CONTINGENT ASSET In 2021 the Group held a supplier of climate systems liable for the delivery of a non-conforming climate system. Due uncertainty no receivable as per 31 December 2024 is recognized in the balance sheet. 26. RISK MANAGEMENT OBJECTIVES AND POLICIES The operations of the Group expose the Group to various financial risks, including liquidity risk, market risk, and credit risk. The risk management is the responsibility of the Management Board of the Group. The main financial risks are described below together with the approach taken to assess and mitigate the relevant financial risk. For a broader and more extensive description of all risks the Group faces it refers to the Risk Management and Internal Control section in its board report. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 90 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Risk type (Unaudited) Risk description Risk assessment and mitigation Remaining risk Liquidity risk Liquidity risk is the risk that the Group is not able to pay its short-term liabilities. The Group refers to Note 2.3 for further elaboration on its liquidity risk. High Market risks Foreign exchange risk is the part of the market risk that arises due to exposure of the Group to foreign currencies. This exposure arises from the Group's involvement in foreign operations or trade in foreign currency (buy and sell). The Group has risk management policies and procedures in place for managing its foreign exchange risk. The foreign currencies the Group has exposure to are the Chinese Yuan (Renminbi) (RMB), Norwegian Krone (NOK), Swedish Krone (SEK) and Danish Krone (DKK) based on: • Sales in NOK, RMB, SEK and DKK • Trade and other receivables denominated in NOK,, SEK, RMB and DKK • Purchases in RMB, SEK, NOK and DKK • Trade and other payables denominated in RMB, SEK, NOK and DKK For its RMB and NOK transactions the Group manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12-month period for hedges of forecasted purchases. The Group’s DKK sales are immaterial. The Group accepts the limited remaining risk. Limited Inflation risk is the part of the market risk that arises due to (unexpected) price increased of goods and services purchased by the Group. The ongoing inflation is resulting in an increase in cost levels for the Group. The Group is continuously monitoring the development or purchase prices for goods and services required on the short, medium and long-term basis. Based on expected price development the Group engages in purchase contracts and/or strategic inventory purchases in order to mitigate the risk of unexpected price increases as much as possible. On the other hand, the Group is also able to recharge (a part of) the increase in cost levels to its customers via increased sales prices. Medium Interest rate risk is the part of the market risk that arises due to movements in interest rates. The Group is exposed to changes in interest rates resulting from the following: • Long term liabilities • The interest rate implicit in the lease However, no long-term liabilities have variable interest rates and outstanding amounts are limited in size. The Group's cash position, due to its short-term nature, has limited exposure to interest rate risk. The resulting residual interest rate risk is considered to be limited. Limited Order risk is the part of the market risk that the Group’s order intake will be less than antici- pated. Due to the Group’s current reputation in the market as a result of the Group’s failure to timely deliver its buses followed by contract cancellations and liquidity constraints, there is a risk that the Group’s order intake is (materi- ally) below plan. High Credit risk Credit risk for the Group mainly consists of the default of trade debtors and contract assets. The Group reflects on the credit risks of trade debtors on a forward-looking basis, based on the simplified ECL approach. Furthermore, the Group determined that the customers (municipalities) of the Group, based on historic performance and entity nature, have a low default probability. The credit risk on other financial assets is considered to be low. Therefore, the Group accepts the residual remaining credit risks. Limited The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments, including interest and dividend on cumulative preference shares. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 91 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS Carrying Total Cash 0 to 3 3 to 121 - 5 years More than 5 As at 31 December 2024 (Unaudited)amountflowsmonths monthsyearsDebt to a credit facility5,359 5,359 - 5,359 - -Convertible bond 17,845 20,307 - - 20,307 -(assuming no conversion)Lease liabilities24,115 26,922 1,289 3,868 18,565 3,200Trade creditors24,981 24,981 24,981 - - -Contract liabilities44,430 44,430 - 44,430 - -Other non-current liabilities1,465 1,465 32 96 1,337Other current liabilities22,913 22,913 11,252 11,661 - -Total 141,108 146,377 37,555 65,414 40,209 3,200Derivatives - - - - - - Carrying Total Cash 0 to 3 3 to 121 - 5 years More than 5 As at 31 December 2023amountflowsmonths monthsyearsDebt to a credit facility1,348 1,348 - 1,348 - -Convertible bond 33,126 36,800 3,067 9,200 24,533 -(assuming no conversion)Lease liabilities16,598 19,247 740 2,220 11,887 4,400Trade creditors30,518 30,518 28,777 762 979 -Contract liabilities18,939 18,939 - 18,939 - -Other non-current liabilities491 491 - - 491 -Other current liabilities30,602 30,602 28,034 2,468 100 -Total 131,622 137,945 60,618 34,937 37,990 4,400Derivatives (13) (13) 5 (18) - - 27. FINANCIAL INSTRUMENTS - HEDGE ACCOUNTING The Group applies hedge accounting. At the moment of entering into a hedge relationship, this is documented by the Group. By means of a test, the Group periodically assesses the effectiveness of the hedge relationship. This may be achieved by comparing the critical characteristics of the hedge instrument with those of the covered position or by comparing the change in fair value of the hedge instrument and the covered position. If applicable, the ineffective share of the value adjustment of the currency futures contracts is accounted for in the profit and loss account under financial income and expenses. USE OF DERIVATIVES The Group is exposed to financial market risk in the normal course of its business operations. The Group uses derivatives for economic hedging purposes to manage its foreign currency risk. The primary objective of the Group’s hedging activities is to manage the potential year-on-year volatility caused by foreign-currency movements on its net earnings by hedging the anticipated net exposure of foreign currencies resulting from foreign-currency purchases. The objective of economic hedging is to enter into positions with an opposite risk profile to an identified risk exposure to reduce that exposure. The single risk which is being hedged is foreign currency exchange rate risk. This risk is primarily hedged with foreign exchange forwards/swaps. The Group’s hedging activities do not have an effect on timing or amount of forecasted transactions. CASH FLOW HEDGE ACCOUNTING Derivatives that qualify for hedge accounting under IFRS are classified and accounted for in accordance with the nature of the hedged exposure and the type of IFRS hedge accounting model that is applicable. The three models applicable under IFRS are: fair value hedge accounting, cash flow hedge accounting, and hedge accounting of a net investment in a foreign operation. The Group applies cash flow hedge accounting to highly probably future cash flows, namely forecasted purchases in a currency other than the Group’s functional currency (€). The Group enters into foreign exchange forwards and swaps to protect against volatility caused by foreign-cur- rency movements on its net earnings by hedging the anticipated net exposure of foreign currencies resulting from foreign-currency purchases. The Group hedges the net anticipated exposures up to the date on which the forecasted transaction is expected to occur. The amounts and timing of future cash flows are projected based on contractual terms. These projected cash flows form the basis for identifying the notional amount subject to foreign currency exchange rate risk that is designated under cash flow hedge accounting. From the derivatives, the Group decides on a contract basis to either allocate the instrument its entirety or to split the spot and the forward element and only designate the spot element as a hedge instrument. The Group determines an economic relationship between the cash flows of the hedged item and the hedging instrument based on an evaluation of the qualitative characteristics of these items and the hedged risk. The Group considers whether the critical terms of the hedged item and hedging instrument closely align when assessing the presence of an economic relationship. The Group evaluates whether the cash flows of the hedged item and the hedging instrument respond similarly to the hedged risk, such as changes in the foreign exchange rates. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 92 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS At the moment of entering into a hedge relationship, this is documented by the Group. The Group periodically assesses the effectiveness of the hedge relationship and analysis the identified potential sources of ineffec- tiveness. The Group has identified the following potential sources of ineffectiveness: • Differences in timing of cash flows of the hedged item(s) and hedging instrument(s); • Incidental notional over-hedging; • The lack of collateralisation of the derivatives, and the resulting counterparty credit risk; • Difference between hedged on-shore and hedging off-shore foreign currency exchange rate; • The Group assumes that the fair value of the hedging instrument is nil at inception of the hedge. Should the fair value of the hedging instrument not be zero at the inception of the hedge, ineffectiveness may arise. The ineffectiveness portion is accounted for in the consolidated statement of profit or loss under Finance expenses, net. The hedge ratio is the ratio between the amount of hedged item and the amount of hedging instrument. The Group uses the following derivative financial instruments in a cash flow hedge accounting relationship: (Unaudited) As at As at 31 December 31 December 20242023Carrying amount hedging instruments - 13Notional amount hedging instruments - 28,622 No derivatives were in place as at 31 December 2024. The derivatives used for cash flow hedge accounting are included in the statement of financial position line- item Other current financial assets respectively liabilities. Derivatives (Unaudited) 2024 2023Other current financial assets- 94Other current financial liabilities- (81)As at 31 December- 13 The following table shows the cash flow hedge accounting impact on profit or loss and comprehensive income, excluding tax impact: Cash flow hedging – impact Hedging gains (+) or losses Hedge ineffectiveness recog-Amount reclassified from of hedging instruments on the (-) (OCI)nized in the statement of cash flow hedge reservestatement of profit or loss and profit or loss, gain (+) / loss other comprehensive income(-)As at 31 December 2024 (Unaudited)FX - -As at 31 December 2023FX 13 3-43 The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities: Fair value measurement usingFair value measurement hierarchy for Date of Total Quoted prices Significant Significant assets as at 31 December 2024 and 2023valuationin active observable unobservable markets inputs inputs (Level 1)(Level 2)(Level 3)Assets measured at fair value:Foreign exchange forward/swaps contracts (Unaudited) - - -31 December 2024Foreign exchange forward/swaps contracts 31 December 13 - 13 -2023 There were no transfers between Level 1 and Level 2 during 2024 and 2023. The valuation technique used in the measurement of the Level 2 securities is based on observable market data. The inputs used in the measurement represent FX and interest rate curves. Fair value measurement usingFair value measurement hierarchy for liabi-Date of Total Quoted prices Significant Significant lities as at 31 December 2024 and 2023valuationin active observable unobservable markets inputs inputs (Level 1)(Level 2)(Level 3)Assets measured at fair value:Embedded derivative (Unaudited) 3,766 - - 3,76631 December 2024Embedded derivative 31 December 4,965 - - 4,9652023 There were no transfers between Level 1 and Level 2 during 2024 and 2023. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 93 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS The valuation technique used in the measurement of the Level 3 is based upon unobservable inputs. The inputs used in the measurement represent the Group’s share price, volatility, time to expiration, risk-free interest rate, and dividend yield. 28. EVENTS AFTER THE BALANCE SHEET DATE (UNAUDITED) FINANCING DEVELOPMENTS In the beginning of 2025 the Group obtained debt financing of €22 million in total from Green Innovation Inter- national Co. Ltd., a Taiwanese company in the business of battery production machines (Green Innovation), CVI Investments Inc., an entity managed by Heights Capital Management, Inc. (Heights) and De Engh B.V. (De Engh). Green Innovation, Heights and De Engh provided a debt financing of €10.0 million, €10.0 million and €2.0 million, respectively, to the Group (the Loans). The Group however still needs to obtain €5 million of Green Innovation. The Loans must be fully repaid by Ebusco by 15 August 2025 and contain customary terms and conditions for a loan of this nature. Under the Loans, €2.2 million in fees (in aggregate) will be payable on the maturity date. In addition, Green Innovation and De Engh have agreed an option to convert the full loan amount plus the fee at their election into Ebusco shares at any time at either (i) a conversion price of EUR 0.50 or (ii) a conversion price that is equal to the Group’s closing share price on the day that is five (5) busi- ness days before either Green Innovation or De Engh elects to convert, as the case may be. Green Innovation obtained the right to nominate a member to the Group’s Management Board in the event it elects to convert the full amount of its Loan into equity. In order to facilitate the Loan from Heights, Ebusco has agreed to an amendment of the convertible bonds held by Heights, as follows: • Reset of the conversion price from €1.7360 to €0.75; • Reinstatement of the amortized payment amounts initially scheduled for payment on 21 June 2025, 21 September 2025 and 21 December 2025 (which, for purposes of the rights issue in November 2024, were deferred to December 2026) to such dates (i.e. reversal of this deferral); and • Extension of the equity raise reset period (being the period during which any equity raise with proceeds exceeding €5 million causes a reset of the conversion price to the placing price of such equity raise) by 12 months from the date of the loan being advanced. The Groups’ business model is furthermore dependent on letters of credit (LCs) from its banks (ING and Rabo- bank) for the payment of finished products being provided to its contract manufacturers and as such allowing the Group to receive the finished products and deliver them to customers before payment is due. Ebusco has been in a continuous dialogue with its banks over the last weeks, which have now confirmed a continuation of specific letters of credit facilities until 14 August 2025, subject to the satisfaction of all conditions precedent, by which time these facilities must be fully repaid. The Group however has triggered events of default with its existing agreement with its banks. The banks have subsequently reserved their right to not allow further utilizations of the facilities which could, when executed, negatively impact the Group’s liquidity position and outlook. The Group is in discussions with the banks to come to a solution but the discussions have not been finalized yet. Finally, at the time of the rights issue, under an investment agreement, Gotion was granted the right to appoint one representative to the management board and one representative to the supervisory board, and the Group was in turn required to convene an EGM for this to be voted on. This EGM was held on 26 March 2025 and the general meeting resolved to appoint Mr. Duan Wei as member of the management board, and Mr. Chen Li as member of the supervisory board, both conditional on conversion of €4.01 million of outstanding accounts payable position into share, which would result in a shareholding of Gotion in the Group of just over 10%. COURT CASE In April 2025, one of the Group’s suppliers filed a petition for the Group’s bankruptcy due to (amongst others) non-payment of overdue invoices. The court case is scheduled for 6 May 2025. LOCATION DEVELOPMENTS As part of the Group’s Turnaround Plan it decided to merge its facility in Deurne and Venray into one location. In 2025 it reached an agreement with its landlord to terminate the lease in Venray. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 94 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS COMPANY STATEMENT OF PROFIT OR LOSS In thousands of euro Notes (Unaudited) 2024 2023 Other operating income B 939 789 Total operating income 939 789 Employee benefit expenses C (1,833) (1,620) Amortization and depreciation expenses (39,278) (31) Other operating expenses D (4,839) (3,643) Total operating expenses (45,950) (5,294) Operating result (45,011) (4,505) Finance income/(expenses), net E (367) 528 Result before income tax (45,378) (3,977) Income tax credit/(expense) F - (2,713) Share of result of an associate - - Result from group companies G (155,302) (112,469) Result after income tax (200,680) (119,159) ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 95 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS COMPANY STATEMENT OF FINANCIAL POSITION Before appropriation of profit, in thousands of euro Notes (Unaudited) As at 31 December 2024 As at 31 December 2023 Assets Right-of-use assets - 71 Intangible assets 28 41 Investments in group companies G - 128,184 Loans to group companies associates H 5,304 4,946 Deferred tax assets F - - Non-current assets 5,332 133,242 Receivables from group companies I 111,584 81,756 Other current assets J 1,953 174 Cash and cash equivalents K - - Current assets 113,537 81,930 Total assets 118,869 215,172 Equity Share capital 3,274 640 Share premium 388,880 337,379 Legal reserves 12,070 22,733 Other reserves 3 351 Retained earnings (175,893) (62,121) Net result (200,680) (119,159) Total Equity L 27,502 179,823 Lease liabilities - 63 Non-current liabilities 63 Provisions G 71,650 - Convertible bond – debt 14,079 28,161 Convertible bond – embedded derivative 3,766 4,965 Trade payables 937 577 Other current liabilities M 822 1,571 Current lease liabilities - 12 Current liabilities 91,367 35,286 Total liabilities 91,367 35,349 Total equity and liabilities 118,869 215,172 Notes (Unaudited) As at 31 December 2024 As at 31 December 2023 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 96 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS NOTES TO THE COMPANY FINANCIAL STATEMENTS B. OTHER OPERATING INCOME Other operating income relates to the recharge of the remuneration expenses of the Management Board members to Ebusco B.V. C. EMPLOYEE BENEFIT EXPENSES Employee benefit expenses can be specified as follows: Employee benefit expenses (Unaudited) 2024 2023 Wages and salaries 1,785 1,189 Pension costs 167 142 Share based payments expenses (283) 185 Temporary staff 109 77 Car expenses 38 24 Other staff expenses 18 3 Total 1,833 1,620 The number of persons with an employment contract at 31 December 2024 was 3 (31 December 2023: 3), including all members of the Management Board; all persons have their place of residence in the Netherlands except for the CEO as his place of residence is in Germany. Further reference is made to Note 6 of the consolidated financial statements. D. OTHER OPERATING EXPENSES Other operating expenses mainly consist of insurance expenses, audit and advisory fees. A. ACCOUNTING POLICIES FOR THE COMPANY FINANCIAL STATEMENTS The Company financial statements of Ebusco Holding N.V. (hereafter 'the Company') have been prepared in accordance with Part 9, Book 2 of the Dutch Civil Code. In accordance with article 362 (8), Book 2 of the Dutch Civil Code, the Company’s financial statements have been prepared on the basis of the accounting principles for recognition, measurement and determination of profit, as applied in the consolidated financial statements. These principles also include the classification and presentation of financial instruments, being equity instruments or financial liabilities. The ordinary shares of Ebusco Holding N.V. are listed on Euronext Amsterdam. All amounts are stated in thousands of EUR, unless otherwise stated. The accounting policies used in the preparation of the Company Financial Statements are the same as those used in the preparation of the Consolidated Financial Statements (in accordance with article 362 (8), Part 9 of Book 2 of the Dutch Civil Code). See the notes to the Consolidated Financial Statements. In addition to these accounting policies, the following accounting policy applies to the Company financial statements: Investments in group companies are presented using the equity method. Goodwill paid upon acquisition of investments in group companies is included in the net equity value of the investment and is not shown sepa- rately on the face of the balance sheet. The Company recognizes a provision which makes use of the option to eliminate intercompany expected credit losses against the book value of loans and receivables to group companies, instead of elimination against the investments in group companies Loans provided to group companies are stated at amortized cost, less impairment. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 97 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS E. FINANCE INCOME/(EXPENSES), NET Finance expenses, net can be specified as follows: Finance expenses, net (Unaudited) 2024 2023 Net foreign exchange result - (4) Intercompany interest income 3,960 1,413 Revaluation of embedded derivative 1,200 594 Financial income 5,160 2,003 Interest expense intercompany - - Interest expense third party (13) (277) Interest on lease liabilities (3) (4) Other finance expenses (5,511) (1,194) Total (5,527) (1,475) Finance expenses, net 367 528 F. INCOME TAX As the Group suffered a history of losses no deferred tax asset has been recognized per 31 December 2024. G. INVESTMENTS IN GROUP COMPANIES Group companies are all entities (including intermediate holding companies) over which the Company has control. The Company controls an entity when it is exposed, or has rights, to variable returns from its involve- ment with the group company and has the ability to affect those returns through its power over the group company. Group companies are recognized from the date on which control is transferred to the Company or its intermediate holding entities. They are derecognized from the date that control ceases. The Company applies the acquisition method to account for the acquisition of group companies, consis- tent with the approach identified in the consolidated financial statements. The consideration transferred for the acquisition of a group company or business comprises the fair value of assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired, and liabilities and contingent liabilities assumed, in an acquisition are initially measured at their fair values at the acquisition date and are subsumed in the net asset value of the investment in consolidated group compa- nies. Goodwill paid upon acquisition of investments in group companies is included in the net equity value of the investment and is not shown separately on the face of the balance sheet. Acquisition-related costs are expensed as incurred. Investments in group companies are measured using the equity method. The measurement of the financial fixed assets under the equity method is based on the measurement principles of assets, provisions and liabil- ities, and the determination of profit as applied in the consolidated financial statements. When group companies have an equity deficit they are measured at zero under the equity method, unless the Company has given a liability undertaking or any other guarantee for the consolidated group company. In case of the latter, the Company recognizes a provision in the statement of financial position equal to the present value of the expected outflows required to settle the obligation. The Company has direct and indirect interests in the group companies listed in Note 2 of the consolidated financial statements. Set out below are the carrying amounts of the investment in consolidated group companies and the movements during the period: Investments in group companies (Unaudited) 2024 2023 As at 1 January 128,184 237,968 Foreign exchange differences 10 (13) Non-controlling interest (1,817) Result of group companies (155,302) (112,469) Reclassification to/(from) provision participations in group companies 71,763 - Cash flow hedge, net of tax (3,580) 2,698 Goodwill impairment (39,258) - As at 31 December - 128,184 ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 98 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS H. LOANS TO GROUP COMPANIES A loan to Pondus Operations B.V. is included of €5,500 as at 31 December 2021 including accrued interest of €245 (interest rate: 7%). The loan to Pondus Operations B.V. has been provided in April 2021 at the time the Company acquired 60% of the voting shares in Pondus Holding B.V. to enable Pondus Operation B.V. to redeem the RVO loan received from the Dutch government. In 2022 part of the loan was repaid by Pondus Operations B.V. (€1,237) and additional interest accrued of €350. In 2023, additional accrued interest amounted to €358 (2023: €333). As Pondus Operations B.V. was merged into Ebusco B.V, the loan has been adjusted towards Ebusco B.V. Loans to group companies can be specified as follows: Loans to group companies (Unaudited) As at 31 December 2024 As at 31 December 2023 Loan receivable from Ebusco B.V. 5,304 - Loan receivable from Pondus Operations B.V. - 4,946 Total 5,304 4,946 The movement schedule of loans to group companies can be specified as follows: Loans to group companies (Unaudited) 2024 2023 As at 1 January 4,946 4,613 Repayment - - Interest 358 333 Total 5,304 4,946 I. RECEIVABLES FROM GROUP COMPANIES Receivables from group companies can be specified as follows: Receivables from group companies (Unaudited) As at 31 December 2024 As at 31 December 2023 Current account Ebusco B.V. 109,501 78,150 Current account Pondus Operations B.V. - 1,778 Current account Ebusco Manufacturing B.V. 325 325 Current account Ebusco Energy B.V. 1,758 1,503 Total 111,584 81,756 J. OTHER CURRENT ASSETS Other current assets as at 31 December 2024 mainly include refundable VAT of €410 (2023: €103) and prepaid expenses of €1,357 related to insurances (2023: €71). K. CASH AND CASH EQUIVALENTS Cash and cash equivalents are all freely available to the Company. The cash and cash equivalents at 31 December 2024 is nil as excess cash is paid to the cash pool in Ebusco B.V. L. EQUITY For a breakdown of equity attributable to equity holders, see the Consolidated Statement of Changes in Equity and related notes including Note 18 of the consolidated financial statements. LEGAL RESERVES Based on Dutch law, a legal reserve needs to be established for currency translations, cash flow hedges, and capitalized costs of development assets. The legal reserve cannot be used for dividend distribution and is therefore restricted in usage (see paragraph below). Legal reserves (Unaudited) As at 31 December 2024 As at 31 December 2023 Foreign exchange differences 17 10 Hedge reserves - 3,664 Revaluation reserve 7,450 7,450 Development assets at subsidiaries 4,603 11,609 Total 12,070 22,733 LIMITATIONS IN THE DISTRIBUTION OF SHAREHOLDERS’EQUITY As at 31 December 2024, pursuant to Dutch law, certain limitations exist relating to the distribution of share- holders’ equity. Such limitations relate to legal reserves required by Dutch law of €12,070 (2023: €22,733). OTHER RESERVES In 2024 the Company established a share based payment reserve of €3 (2023: €351). As the Company incurred a loss in 2024, it is proposed to the Annual General Meeting of Shareholders to charge the loss attributable to the equity holders of the Group to the retained earnings and not to pay any dividend relating to the financial year 2024. M. OTHER CURRENT LIABILITIES Other current liabilities as at 31 December 2024 mainly consists of expenses incurred for the placement of payroll taxes €315 and audit fees €600. ANNUAL REPORT EBUSCO 2024 INTRODUCTION GOVERNANCE 99 MANAGEMENT BOARD REPORT OTHER INFORMATIONFINANCIAL STATEMENTS N. REMUNERATION KEY MANAGEMENT Reference is made to Note C to the Company financial statements and Note 6 to the consolidated financial statements. O. RELATED PARTIES In addition to Note 24 of the consolidated financial statements, all companies within the Group are also considered to be related parties of Ebusco Holding N.V. P. COMMITMENTS AND CONTINGENCIES Reference is made to Note 25 to the consolidated financial statements. Pursuant to the provisions of section 403, Part 9, Book 2 of the Netherlands Civil Code, the Company has assumed joint and several liability for the debts arising out of legal transactions of the following group companies: • Ebusco B.V. • Ebusco Energy B.V. • Ebusco Manufacturing B.V. • Pondus Operations B.V. The joint and several liability for Pondus Operations B.V. ceased to exist at the time of the merger into Ebusco B.V. as disclosed in Note 2 of the consolidated financial statements. Being the head of the Ebusco Holding N.V. tax entity, the company is liable for the income tax and VAT liability of the fiscal unity as a whole. Q. DIVIDEND No dividends have been paid in both 2024 and 2023. R. AUDITORS’ FEES Audit, Other assurance and Other non-audit fees incurred related to the financial years 2024 and 2023 can be specified as follows: (Unaudited) 2024 2023 Total fees in € ‘000 EY Accoun- tants B.V. EY network firms in the Netherlands Total Ernst & Young Accountants LLP EY network firms in the Netherlands Total Audit services 969 - 969 681 - 681 Other assurance services - - - 60 - 60 Other non-audit services - - - - - - Total 969 - 969 741 - 741 S. SUBSEQUENT EVENTS For information regarding subsequent events, reference is made to Note 28 to the consolidated financial statements. OTHER NOTES As approved for publication, Deurne, 30 April 2025 Management Board Supervisory Board P.H.A.M. Bijvelds, Founder D.J. Haank, Chairman C. Schreyer, Chief Executive Officer C.W. Gorter M. van Maanen, Chief Operating Officer R.H. de Boer Provisions of the articles of association relating to profit appropriation 101 Update on Independent auditor’s report 102 Shareholder information 103 Five year overview 104 Non-IFRS measures 105 Organisation Ebusco 107 CONTENT OTHER INFORMATION ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 100 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION OTHER INFORMATION PROVISIONS OF THE ARTICLES OF ASSOCIATION RELATING TO PROFIT APPROPRIATION Pursuant to article 31 of the articles of association of the Company, the Management Board, with the approval of the Supervisory Board, may decide that profits realized during a financial year are fully or partially appro- priated to increase and/or from reserves (article 31.1). The profits remaining shall be put at the disposal of the General Meeting. The Management Board, with the approval of the Supervisory Board, shall make a proposal for that purpose. A proposal to pay a dividend shall be dealt with as a separate agenda item at the General Meeting of Shareholders (article 31.2). The Company does not intend to declare or pay dividends for the financial year ending 31 December 2024 or in the medium term. The net loss attributable to equity holders of the Group for 2024 of €200.6 million (2023: net loss of €119.2 million) will be deducted from retained earnings. ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 101 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION UPDATE ON INDEPENDENT AUDITOR’S REPORT The very challenging business circumstances that Ebusco has gone through in the last months, and those which Ebusco continues to face and the transformation the company is going through, including its refi- nancing and restructuring efforts, have placed significant demands on the time and resources of the company. As a result, the drafting of the 2024 financial statements and consequently, the external auditor’s audit process, have experienced delays, which prevented completion of the audit within the expected timeframe. Consequently, the financial statements included in this annual report as published today, are unaudited. ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 102 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION SHAREHOLDER INFORMATION SHARE INFORMATION Ebusco Holding N.V. is listed on the official stock market of Euronext Amsterdam (EBUS.AS) since 22 October 2021. On 31 December 2024, the number of issued or- dinary Ebusco Holding N.V. shares amounted to 65,470,708 with a nominal value of €0.05. Each share in the capital of Ebusco Holding N.V. gives entitlement to cast one vote. SHARE PERFORMANCE REVIEW The performance of Ebusco’s ordinary shares on Euronext Amsterdam: 2024 2023 Closing ordinary share price at calendar year-end (in EUR) 1.14 4.79 Highest closing ordinary share price (in EUR) 10.09 14.75 Lowest closing ordinary share price (in EUR) 0.78 4.27 Average daily trading volume (in shares) 516,807 177,027 Highest daily trading volume (in shares) 6,335,319 1,175,781 Market capitalisation (EUR million). 74.6 306.7 MAJOR SHAREHOLDERS In line with the Dutch Financial Supervision Act, holders of shares of Ebusco Holding N.V. are required to update information on their holdings when they reach, exceed, or fall below the thresholds of 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75% and 95% reach. As far as Ebusco is aware and on the basis of the AFM register of substantial holdings, the following investors held a holding of 3% or more in Ebusco at the date of this report. Shareholders Participation in % Date of last report ING Groep N.V. 8.89 November 2024 P.H.A.M. Bijvelds 17.57 November 2024 Heights Capital Management, Inc. 42.40 April 2025 B.V. Beleggings- fonds “Hoogh Blarick” 4.36 November 2024 Gotion High-Tech Co., Ltd. 3.30 November 2024 * The percentages below are, to the best of Ebusco’s knowledge and based on the AFM register Notifi cation of Control, the sum of shares and potential shares. ** The shares are held by Peter Bijvelds Holding Erp B.V., which shares are held by Stichting Administratiekantoor Peter Bijvelds Holding Erp, for the benefi t and account of P.H.A.M. Bijvelds. *** The shares and potential shares are held by Heights Capital Management, Inc., which shares are held by CVI Investments, Inc., for the benefi t and account of Heights Capital Management, Inc.. * The shares are held by B.V. Beleggingsfonds “Hoogh Blarick”, which shares are held by Beleggingsmaatschappij “De Engh “BV, for the benefi t and account of B.V. Beleggingsfonds “Hoogh Blarick”. DIVIDEND POLICY Ebusco does not intend to declare or pay dividends for the fi nancial year ending 31 December 2024 or in the medium term. The company anticipates that for the foreseeable future it will retain all its future earnings for use in the development of its business, its international expansion strategy and for general corporate purposes. INVESTOR RELATIONS Ebusco is committed to maintaining an open and constructive dialogue with its current and potential shareholders (jointly the Investors) and analysts. Conversations with investors and analysts, both in (annual or extraordinary) general meetings and on bilateral basis outside of such general meetings (e.g. investor calls, road shows, broker conferences etc.), form an integral part of this dialogue. Ebusco aims to keep the investors and analysts updated by informing them equally, simultaneously, clearly and accurately about Ebusco’s strategy, perfor- mance and other matters and developments that could be relevant to Investors’ decisions either via meetings, presentations, conference calls etc. as referred to in best practice provision 4.2.3 of the Dutch Corporate Governance Code or otherwise. The company website www.ebusco.com provides relevant information (press releases, fi nancial data) for investors. Ebusco observes a closed period during which no discussions are held with investors and analysts. This pertains to a period of 45 calendar days prior to the publication of the yearly results and 30 calendar days prior to the publication of half yearly results. Furthermore, the closed period is 10 calendar days prior to the publication of pre-scheduled trading updates. PREVENTION MISUSE OF INSIDER INFORMATION Ebusco has rules governing the reporting of trans- actions involving Ebusco Holding N.V. securities by its Supervisory Board, Management Board and other appointed persons, including staff, the management and a number of permanent advisors. The Insider Trading Policy is published on the corporate website investors.ebusco.com. Ebusco has also appointed the corporate secretary as compliance offi cer. The compliance offi cer is responsible for supervising compliance with the rules and regulations, and communication with the AFM. ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 103 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION FIVE YEAR OVERVIEW 2024 2023 2022 2021 2020 Results (in thousands of euro) Revenue 10,665 102,440 111,617 24,265 99,994 Gross profi t 1/2 (34,602) (6,848) 15,633 1,220 39,657 Result for the year (200,771) (120,146) (32,193) (26,797) 16,659 Result for the year attributable to Equity holders of the Group (200,632) (119,159) (31,717) (26,388) 16,659 EBITDA 2/3 (132,635) (95,733) (34,808) (34,240) 27,135 EBIT 2/4 (196,382) (103,869) (40,435) (39,571) 23,776 Capital expenditure 2/5 (15,266) (17,119) (9,725) (4,932) (3,814) Net cash fl ow from operating activities (43,175) (103,799) (99,058) (19,390) (11,427) Net cash fl ow from investing activities (16,933) (20,071) (8,496) (27,284) (3,994) Net cash fl ow from fi nancing activities 34,586 56,576 (5,172) 227,734 39,473 Free cash fl ow 2/6 (61,733) (123,452) (107,526) (25,574) (15,878) Balance sheet (in thousands of euro) Total Assets 180,063 319,831 320,616 332,715 104,459 Total Equity 27,502 178,297 273,458 303,948 28,042 Net debt, excluding lease liabilities 2/7 20,805 6,556 (94,726) (207,245) 31,203 Net debt, including lease liabilities 2/8 44,920 23,154 (86,965) (198,863) 32,985 Net working capital 2/9 61,329 144,009 106,299 41,321 58,540 Capital employed 2/10 49,044 194,137 279,903 311,662 42,298 Ratios Gross profi t as % of revenue (324.4%) (6.7%) 14.0% 5.0% 39.7% EBITDA as % of revenue (1243.6%) (93.50%) (31.2%) (141.1%) 27.1% EBIT as % of revenue (1841.4%) (101.40%) (36.2%) (163.1%) 23.8% 2024 2023 2022 2021 2020 Non-fi nancial Orders received (# buses) 13 48 530 414 240 39 Buses delivered (# buses) 157 178 75 139 103 km (in millions) driven 152 105 70 39 17 Full-time employees per year-end, excluding temporary employees 478 557 418 219 124 Full-time employees yearly average, excluding temporary employees 517 503 321 171 106 Full-time employees per year-end, including temporary employees 522 893 607 309 145 Full-time employees yearly average, including temporary employees 708 798 446 227 122 Number of shares outstanding (in thousands) 14,15 At year-end 11 65,471 64,039 59,039 59,039 44,999 On average 11 18,602 59.217 59,039 47,502 44,999 Per ordinary share 14,15 Basic earnings per share 11 (10.79) (2.01) (0.54) (0.56) 0.37 Highest share price 12 10,09 14.75 27.00 31.30 - Lowest share price 12 0,78 4.27 13.06 21.85 - Share price at year-end 12 1,14 4.79 13.17 27.00 - Notes: 1 Gross profi t is defi ned as the Group’s top-line earnings, being total revenue, less cost of materials (being the direct costs of goods sold). 2 These items are non-IFRS Measures. For further information about these non-IFRS Measures, and the reasons why we believe they are important for an understanding of the performance of our company, please refer to our commentary on non-IFRS Measures on page 105-106. 3 EBITDA is defi ned as operating result plus depreciation and amortization costs. 4 EBIT is defi ned as operating result. 5 Capital expenditure is defi ned as the sum of “investments in property, plant and equipment” and “investments in intangible assets” from the Consolidated Statement of Cash Flows. 6 Free cash fl ow is defi ned as the sum of net cash from operating and investing activities, excluding the acquisition and disposal of subsidiaries, associates and other equity investments, and dividends from associates; including repayment of lease liabilities. 7 Net debt excluding lease liabilities is defi ned as the non-current and current loans and borrowings minus cash and cash equivalents. 8 Net debt including lease liabilities is defi ned as the non-current and current loans and borrowings, including lease liabilities, minus cash and cash equivalents. 9 Net working capital is defi ned as inventories plus trade receivables and contract assets minus trade payables and contract liabilities. 10 Capital employed is defi ned as total assets less current liabilities. 11 The number of ordinary shares outstanding in 2019 and 2020 has been adjusted for the capital restructuring in 2021 in preparation for the Initial Public Offering. 12 The share price represents the price at closing. 13 Ebusco received orders for 121 buses, however 73 were cancelled during the remainder of the year. 14 The 2024 share data refl ect the 5 to 1 share consolidation which was effectuated as per 24 October and capital increases through a rights issue (20 November 2024) and issued shares in relation to the repayment of the convertible bond 15 Following the amendment of the authorized share capital as approved by the EGM of 24 October, the nominal value of each Ordinary Share was changed from €0.01 to €0.05 as per that date ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 104 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION NON-IFRS MEASURES GENERAL Certain discussions and analyses set out in this Annual Report include measures which are not defi ned by IFRS. We believe this information, along with comparable IFRS-measures, is useful to investors and other stakeholders because it provides a basis for measuring our operating performance. The Management Board also uses these measures, along with the most directly comparable IFRS-measures, in evaluating operating performance. GROSS PROFIT Gross Profi t is defi ned as the Group’s top-line earnings, being total revenue, less cost of materials (being the direct costs of goods sold, excluding employee expenses). We believe this measure provides valuable additional information because it allows investors and other stakeholders to analyze the gross margin of our buses sold. In addition, Gross Profi t is a key measure used internally to evaluate (sales) performance. Gross profi t is calculated as follows (in thousands of euro): 2024 2023 Revenue 10,665 102,440 Cost of materials (45,267) (109,288) Gross profi t (34,602) (6,848) EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) EBITDA is result for the year before net fi nance costs, the net income tax expense, depreciation and amor- tization. EBITDA is defi ned as operating result plus depreciation and amortization expenses. We believe this measure provides valuable additional information because it allows investors and other stakeholders to analyze the profi tability between companies and industries by eliminating the effect of non-operating deci- sions like interest expenses, tax rates and non-cash items like depreciation and amortization, hence facil- itating focus on operating performance. In addition, EBITDA is a key measure used internally to evaluate performance. The reconciliation of profi t before tax to EBITDA is as follows (in thousands of euro): 2024 2023 Profi t before tax (200,573) (105,672) Amorization & depreciation expenses 63,747 8,136 Finance expenses (net) 3,035 932 Share of result from associates 1,156 871 EBITDA (132,635) (95,733) EARNINGS BEFORE INTEREST AND TAXES (EBIT) EBIT is result for the year before net fi nance costs and the net income tax expense. EBIT is defi ned as oper- ating result. We believe this measure provides valuable additional information because it allows investors and other stakeholders to analyze the profi tability between companies and industries by eliminating the effect of non-operating decisions like interest expenses and tax rates, hence facilitating focus on operating perfor- mance. The reconciliation of profi t before tax to EBIT for the year is as follows (in thousands of euro): 2024 2023 Profi t before tax (200,573) (105,672) Finance expenses (net) 3,035 932 Share of result from associates 1,156 871 EBIT (196,382) (103,869) FREE CASH FLOW Free cash fl ow is defi ned as the sum of the cash from operating and investing activities, excluding the acqui- sition and disposal of subsidiaries, associates and other equity investments, and dividends from associates, including repayment of lease liabilities. Free cash fl ow refl ects an additional way of assessing our liquidity that we believe is useful to investors and other stakeholders because it represents cash fl ows that could be used to fund our strategic initiatives, including the scale-up of the manufacturing of the Ebusco 3.0. The breakdown of free cash fl ow is as follows (in thousands of euro): 2024 2023 Net cash from operating activities (43,175) (103,799) Net cash from investing activities (16,933) (20,071) Payment of principal portion of lease liabilities (3,270) (1,932) Investment in subsidiaries, associates 1,645 2,350 Free cash fl ow (61,733) (123,452) NET DEBT, EXCLUDING LEASE LIABILITIES Net debt, excluding lease liabilities is defi ned as the non-current and current loans and borrowings minus cash and cash equivalents. Our net debt refl ects our ability to meet our debt obligations if these were due immediately. ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 105 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION The net debt, excluding lease liabilities is calculated as follows (in thousands of euro): 2024 2023 Loans and borrowings - non-current - - Loans and borrowings – current 5,359 1,348 Convertible bond – debt 14,079 28,161 Convertible bond – embedded derivative 3,766 4,965 Cash and cash equivalents (2,399) (27,918) Net debt excluding lease liabilities 20,805 6,556 NET DEBT, INCLUDING LEASE LIABILITIES Net debt, including lease liabilities is defi ned as the non-current and current loans and borrowings, plus lease liabilities minus cash and cash equivalents. Our net debt refl ects our ability to meet our debt obligations if these were due immediately. The net debt, including lease liabilities is calculated as follows (in thousands of euro): 2024 2023 Loans and borrowings - non-current - - Lease liabilities - non-current 19,854 14,216 Loans and borrowings - current 5,359 1,348 Convertible bond – debt 14,079 28,161 Convertible bond – embedded derivative 3,766 4,965 Lease liabilities - current 4,261 2,382 Cash and cash equivalents (2,399) (27,918) Net debt including lease liabilities 44,920 23,154 NET WORKING CAPITAL Our net working capital is defi ned as inventories plus trade receivables and contract assets minus trade paya- bles and contract liabilities. We believe this measure provides valuable additional information to investors and other stakeholders because it represents Ebusco’s liquidity and the short-term fi nancial health of the company. In addition, net working capital is a key measure used internally to evaluate (short-term) liquidity. Net working capital is calculated as follows (in thousands of euro): 2024 2023 Inventories 117,677 106,541 Trade receivables 5,494 19,285 Contract assets 7,569 67,640 Trade payables (24,981) (30,518) Contract liabilities (44,430) (18,939) Net working capital 61,329 144,009 CAPITAL EMPLOYED Capital employed is defi ned as total assets less current liabilities. This key fi gure provides valuable insight into how well the company is investing its money to generate profi ts. Capital employed is calculated as follows (in thousands of euro): 2024 2023 Total assets 180,063 319,831 Current liabilities (131,019) (125,694) Capital employed 49,044 194,137 GROSS PROFIT AS % OF REVENUE Gross profi t as % of revenue is calculated as follows (gross profi t and revenue in thousands of euro): 2024 2023 Gross profi t (34,602) (6,848) Revenue 10,665 102,440 Gross profi t % of revenue (324.4%) (6.7%) EBITDA AS % OF REVENUE EBITDA as % of revenue is calculated as follows (EBITDA and revenue in thousands of euro): 2024 2023 EBITDA (132,635) (95,733) Revenue 10,665 102,440 EBITDA % of revenue (1243.6%) (93.5%) EBIT AS % OF REVENUE EBIT as % of revenue is calculated as follows (EBIT and revenue in thousands of euro): 2024 2023 EBIT (196,382) (103,869) Revenue 10,665 102,440 EBIT % of revenue (1841.4%) (101.4%) ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 106 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION CFO CEO COO Human Resources Sales Treasury Corporate Development & Communication Project Management Office (PMO) Internal Audit QHSSE Production Management IT Procurement & Logistics After Sales Support Company Secretary & Legal Engineering Ebusco Energy Group Controlling & Accounting Founder The top layer, shown in copper, represents the Management Board. The CFO role was up and until 30 April held on an interim basis by Jan Piet Valk, who is not a formal member of the Management Board. Once a permanent candidate is appointed, the CFO position will become part of the Management Board. The layer illustrated in grey represents the Leadership Team, whose members report directly to the Management Board. ANNUAL REPORT EBUSCO 2024 INTRODUCTION FINANCIAL STATEMENTS 107 MANAGEMENT BOARD REPORT GOVERNANCE OTHER INFORMATION COLOPHON This annual report is a publication by Ebusco. Ebusco Vuurijzer 23 5753 SV Deurne The Netherlands T +31 (0)88 1100 200 E [email protected] www.ebusco.nl Editing and texts Ebusco Lindner & van Maaren Design and layout Monter, Amsterdam 894500WSIBBFFKHL6B322024-01-012024-12-31894500WSIBBFFKHL6B322023-01-012023-12-31894500WSIBBFFKHL6B322024-12-31894500WSIBBFFKHL6B322023-12-31894500WSIBBFFKHL6B322022-12-31ifrs-full:IssuedCapitalMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:IssuedCapitalMember894500WSIBBFFKHL6B322023-12-31ifrs-full:IssuedCapitalMember894500WSIBBFFKHL6B322022-12-31ifrs-full:SharePremiumMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:SharePremiumMember894500WSIBBFFKHL6B322023-12-31ifrs-full:SharePremiumMember894500WSIBBFFKHL6B322022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember894500WSIBBFFKHL6B322023-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember894500WSIBBFFKHL6B322022-12-31ifrs-full:ReserveOfCashFlowHedgesMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:ReserveOfCashFlowHedgesMember894500WSIBBFFKHL6B322023-12-31ifrs-full:ReserveOfCashFlowHedgesMember894500WSIBBFFKHL6B322022-12-31ifrs-full:ReserveOfChangeInValueOfForeignCurrencyBasisSpreadsMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:ReserveOfChangeInValueOfForeignCurrencyBasisSpreadsMember894500WSIBBFFKHL6B322023-12-31ifrs-full:ReserveOfChangeInValueOfForeignCurrencyBasisSpreadsMember894500WSIBBFFKHL6B322022-12-31ifrs-full:MiscellaneousOtherReservesMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:MiscellaneousOtherReservesMember894500WSIBBFFKHL6B322023-12-31ifrs-full:MiscellaneousOtherReservesMember894500WSIBBFFKHL6B322022-12-31ifrs-full:RetainedEarningsMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:RetainedEarningsMember894500WSIBBFFKHL6B322023-12-31ifrs-full:RetainedEarningsMember894500WSIBBFFKHL6B322022-12-31ifrs-full:EquityAttributableToOwnersOfParentMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:EquityAttributableToOwnersOfParentMember894500WSIBBFFKHL6B322023-12-31ifrs-full:EquityAttributableToOwnersOfParentMember894500WSIBBFFKHL6B322022-12-31ifrs-full:NoncontrollingInterestsMember894500WSIBBFFKHL6B322023-01-012023-12-31ifrs-full:NoncontrollingInterestsMember894500WSIBBFFKHL6B322023-12-31ifrs-full:NoncontrollingInterestsMember894500WSIBBFFKHL6B322022-12-31894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:IssuedCapitalMember894500WSIBBFFKHL6B322024-12-31ifrs-full:IssuedCapitalMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:SharePremiumMember894500WSIBBFFKHL6B322024-12-31ifrs-full:SharePremiumMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember894500WSIBBFFKHL6B322024-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:ReserveOfCashFlowHedgesMember894500WSIBBFFKHL6B322024-12-31ifrs-full:ReserveOfCashFlowHedgesMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:ReserveOfChangeInValueOfForeignCurrencyBasisSpreadsMember894500WSIBBFFKHL6B322024-12-31ifrs-full:ReserveOfChangeInValueOfForeignCurrencyBasisSpreadsMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:MiscellaneousOtherReservesMember894500WSIBBFFKHL6B322024-12-31ifrs-full:MiscellaneousOtherReservesMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:RetainedEarningsMember894500WSIBBFFKHL6B322024-12-31ifrs-full:RetainedEarningsMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:EquityAttributableToOwnersOfParentMember894500WSIBBFFKHL6B322024-12-31ifrs-full:EquityAttributableToOwnersOfParentMember894500WSIBBFFKHL6B322024-01-012024-12-31ifrs-full:NoncontrollingInterestsMember894500WSIBBFFKHL6B322024-12-31ifrs-full:NoncontrollingInterestsMemberiso4217:EURiso4217:EURxbrli:shares
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