Fope — Earnings Release 2021

Mar 25, 2022

FOPE GROUP APPROVES THE RESULTS FOR 2021: EBITDA

MARGIN STANDS AT 21.8% AND NFP IS CASH POSITIVE FOR EURO 1.9 MILLION; PROPOSED DIVIDEND OF EURO 0.45 P.S.

The strategy of ensuring the direct commercial oversight of the main markets continues: establishment of FOPE Deutschland Gmbh resolved

• Net revenues: Euro 40.3 mln (2020: Euro 26.0 mln/2019: Euro 35.0 mln)
• EBITDA: Euro 8.8 mln (2020: Euro 4.0 mln/2019: Euro 6.8 mln)
• EBIT: Euro 6.8 mln (2020: Euro 2.3 mln/2019: Euro 5.4 mln)
• Net Profit: Euro 5.0 mln (2020: Euro 1.7 mln/2019: Euro 4.9 mln)
• Net financial position: cash positive for Euro 1.9 mln (2020: debt for Euro 2.4 mln)
• Equity: Euro 25.8 million (2020: Euro 20.6 million)

CEO Diego Nardin will present the 2021 results during the EGM INVESTOR DAY organised by IR Top Consulting (6 April at 9:30 am)

Vicenza, 25 March 2022

The Board of Directors of FOPE (FPE:IM), a leading Italian fine jewellery company listed on Euronext Growth Milan, has today approved the Consolidated Financial Statements and the Draft Separate Financial Statements at 31 December 2021.

Diego Nardin, FOPE Chief Executive Officer: "2021 ended on a positive note, with sales and other economic indicators up steadily, showing a robust financial position. We are satisfied with the closing revenue figure which, as already mentioned in late January, exceeded our initial expectations; it is an important result achieved in a context, that of 2021, in which the markets were still impacted by the negative effects of the pandemic. The revenue volumes achieved, coupled with an efficient operational management of costs, have generated excellent margins, taking EBITDA margin back to pre-Covid 19 results. Similarly to the economic aspects, cash flow management has also been excellent: we achieved a cash positive net financial position of Euro 1.9 million, implementing all planned investments. The financial statements results are therefore very positive indeed but, above all, they are comforting signs that show the recovery of the Company's growth process, with foreign countries remaining in the front line, and of the continuous gaining of standing by the FOPE brand in the perception of our retailers and customers. During the early months of 2022, market response remained excellent, confirming positive expectations for the new year."

Consolidated highlights at 31 December 2021

Net revenues amounted to Euro 40.3 million, up 55.0% compared to Euro 26.0 million in 2020 and 15.3% compared to Euro 35.0 million in 2019.

EBITDA totalled Euro 8.8 million, +122.7% compared to Euro 4.0 million in 2020 and +29.6% compared to Euro 6.8 million in 2019. The EBITDA margin figure is particularly important, coming in at 21.8% and therefore higher than the pre-Covid 19 figure (19.4% in 2019).

EBIT stood at Euro 6.8 million, a significant improvement compared to Euro 2.3 million in 2020 and Euro 5.4 million in 2019. The EBIT margin reached 16.8% (15.5% in 2019).

Net profit totalled Euro 5.0 million, a significant improvement compared to Euro 1.7 million in 2020 and in line with Euro 4.9 million in 2019.

The Net Financial Position is cash positive for Euro 1.9 million, showing strong improvement compared to a net financial debt of Euro 2.4 million at 31 December 2020.

Equity came to Euro 25.8 million, as compared to Euro 20.6 million at 31 December 2020.

Distribution of profit for the year

The Board of Directors has resolved to propose that the Shareholders' Meeting allocates the parent company's profit for the year of Euro 5,661,857, as follows:

• Euro 283,093 to the legal reserve,
• Euro 2,948,940 to the extraordinary reserve,
• Euro 2,429,824 by way of dividends, distributing a gross dividend of Euro 0.45 per share to the 5,399,608 outstanding ordinary shares.

In respect of the ordinary dividend that will be assigned for payment starting 4 May 2022 - exdividend date no. 5 on 2 May 2022 and record date on 3 May 2022 - the dividend yield is 2.98%, while the payout ratio is 43%.

Significant events after the reporting period

Resolution to establish FOPE Deutschland Gmbh

In February 2022, the Board of Directorsresolved to establish a new company, 100% owned by FOPE S.p.A., named FOPE Deutschland Gmbh, with registered office in Germany.

The establishment of the new company comes as part of the strategy pursued by the Group in recent years, aiming to assure direct commercial oversight of the main markets, which has already proved extremely successful in the American and English branches.

In view of the increased sales volumes and size of the network of retailers, the German market is now sufficiently mature to warrant the presence of a Fope office focused on monitoring and supporting the strengthening of partnerships with customers in this area and on marking the start of a new phase of growth and development.

The project to open the new branch entails the revision of the commercial organisational structure currently present in Germany, with the recruitment of new staff, and entails for Fope Deutschland to be fully operative by the end of the first semester of 2022.

Business outlook

In light of the excellent results recorded in FY 2021, despite not lifting all the reserves regarding potential future developments, it is believed that the negative impact generated by the Covid-19 pandemic on the Group's markets of interest can be considered to have been overcome. The sales volumes and orders collected in the early months of 2022 provide confirmation of these positive indications.

With regard to the geopolitical scenario, characterised by tension between Russia and Ukraine, although we are unable to exclude potential indirect negative effects in the event of a deterioration of the Eurozone economy as a result of a prolongation of the conflict, it should be noted that, as the Group does not operate on these markets, it is not aware of any direct phenomena that could impact the positive development of the Group's business as forecasted for this year.

Based on the Company's forecasts for FY2022, the Group expects growing sales volumes and a profit for the current year. The results of the first months of 2022 confirm these forecasts and, consequently, the aforementioned expectations.

Convening of the Ordinary Shareholders' Meeting

The Board of Directors has resolved to convene the Ordinary Shareholders' Meeting for 28 April 2022, at single call, at 10:30 am at the Company's registered offices, to discuss and resolve on the following agenda:

• Approval of the financial statements at 31 December 2021, complete with the reports by the Board of Directors, the Board of Statutory Auditors and the Independent Auditing Firm. Presentation of the Group's consolidated financial statements at 31 December 2021 and relevant reports. Related and consequent resolutions.
• Allocation of the result for the year. Related and consequent resolutions.
• Election of the Board of Directors following determination of the number of its members, appointment of the Chairman of the Board of Directors, determination of the term of office of directors and determination of total remuneration payable to them. Related and consequent resolutions.

The Convening of the Ordinary Shareholders' Meeting, which will be published within the terms established by the law and the Articles of Association, shall also specify how the meeting can be attended, in particular in view of the needs dictated by the current emergency situation, its continuation thereof, and in compliance with the provisions of current law in force. Please also note that the documentation relating to the items on the agenda will be made available to the public at the Company's registered office and in the "Investor Relations/Shareholders' Meeting" section of the website www.fopegroup.com, within the terms established by current legislation.

EGM INVESTOR DAY

FOPE reports that on 6 April 2022 at 9:30 am, it will be taking part in the EGM INVESTOR DAY organised by IR Top Consulting in partnership with Borsa Italiana.

The event, which can be accessed via the ZOOM platform, aims to offer the financial community the chance to discuss matters with the top management teams of selected companies listed on Euronext Growth Milan, as they analyse 2021 financial results and 2022 trends.

Diego Nardin, FOPE Chief Executive Officer, will be attending. Registration is mandatory at: https://us02web.zoom.us/webinar/register/WN\_W6Epdz4TQ7GIMc9e3dqF2A

The institutional presentation will be made available on the date of the event in the "Investor Relations/Events and Presentations" section of the website www.fopegroup.com.

The press release is available on the websites www.fopegroup.com and

FOPE (FPE:IM; ISIN IT0005203424) is a historic Italian jewellery company established in Vicenza in 1929 and a leader in the fine jewellery market. With Euro 26 million in revenues in 2020, 59 employees, and a strong international presence (it generates 91% of its revenues abroad), FOPE pursues a strategic growth project based on expanding and consolidating the brand in the international luxury market by leveraging 4 competitive advantages: product quality, perfect combination of Made-in-Italy craftsmanship and technology, recognisable design, and long-standing customer relationships. FOPE operates globally through a well-established and select network of over 700 stores in 50 countries (with a direct presence in the US, Arab, and UK markets through the subsidiaries FOPE USA Inc., FOPE Services DMCC, and FOPE Jewellery Limited, respectively). The business model focuses on maintaining direct business relationships with multi-brand jewellery retailers (either independent or part of groups) that specialise in luxury products such as fine jewellery and watches. FOPE does not work with intermediaries: instead, it enters into direct partnerships that ensure the loyalty and reliability of the customer/retailer as well as an outstanding after-sale service. In 2015, the Company opened its first monobrand store in Venice's Piazza San Marco and in 2019 a flagship boutique in the prestigious Old Bond Street in London. The entire production cycle—from prototyping to the shipping of finished jewels to over 50 countries— takes place inside the headquarters in Vicenza. FOPE's investments in R&D have led to an extremely high level of standardisation and automation, with proprietary technology that allows to optimise processes and times in order to deliver products of world-class quality. FOPE's jewels range from timeless classics featuring the iconic Novecento mesh to the more recent Flex'it lines, which include the original bracelets made flexible thanks to a patented system of tiny gold springs embedded in the mesh—strikingly elegant collections that always stand out in terms of comfort and portability. FOPE has obtained the voluntary TF (Traceability & Fashion) certification and is a certified member of the Responsible Jewellery Council.

CONTACTS

FOPE

INVESTOR RELATIONS MANAGER Diego Nardin, inv.relations@fope.com│ T +39 0444 286911

IR TOP CONSULTING INVESTOR RELATIONS Maria Antonietta Pireddu, m.pireddu@irtop.com │ T +39 0245473884 FINANCIAL MEDIA RELATIONS Domenico Gentile, d.gentile@irtop.com │ Antonio Buozzi, a.buozzi@irtop.com | T +39 0245473884

INTEGRAE SIM EURONEXT GROWTH ADVISOR | T +39 02 87208720 │ Via Meravigli 13, Milan

Attachments:

• Consolidated Income Statement
• Consolidated Balance Sheet
• FOPE SpA Income Statement
• FOPE SpA Balance Sheet

CONSOLIDATED INCOME STATEMENT

Euro	31/12/2021	31/12/2020	Change
Revenue	40,306,787	25,998,489	14,308,298
Other revenue and income	399,132	465,760	(66,628)
External costs	28,181,812	19,481,047	8,700,765
Added value	12,524,107	6,983,202	19,507,309
Personnel costs	3,736,898	3,037,782	699,116
EBITDA	8,787,209	3,945,420	4,841,789
Depreciation and amortisation	2,006,714	1,608,155	398,559
EBIT	6,780,495	2,337,265	4,443,230
Financial income and charges	49,300	(260,184)	309,484
Pre-tax profit	6,829,795	2,077,081	4,752,714
Earnings before Tax	1,800,240	405,383	1,394,857
Net profit	5,029,555	1,671,698	3,357,857

CONSOLIDATED BALANCE SHEET

Euro	31/12/2021	31/12/2020	Change
Net intangible fixed assets	3,107,912	3,580,307	(472,395)
Net tangible fixed assets	9,568,105	10,062,221	(494,116)
Holdings/equity and other financial fixed assets	88,071	78,611	9,460
Non-current assets	12,764,088	13,721,139	(957,051)
Warehouse stock	10,308,809	8,426,383	1,882,426
Trade receivables	9,324,585	5,592,008	3,732,577
Current receivables	1,301,646	943,774	357,872
Cash flow hedging op. cr. position	794,993	419,932	375,061
Short-term assets for the year	21,730,033	15,382,097	6,347,936
Trade payables	4,457,257	2,471,024	1,986,233
Current liabilities	3,313,533	787,984	2,525,549
Short-term liabilities for the year	7,770,789	3,259,008	4,511,781
Net working capital	13,959,243	12,123,089	1,836,154
Severance pay fund	(1,006,788)	(953,534)	(53,254)
End-of-mandate indemnity fund and other funds	(1,727,961)	(1,548,946)	(179,015)
Expected cash flow hedging op. fund	(21,931)	(352,521)	330,590
Provisions for risks and non-current charges	(2,756,680)	(2,855,001)	98,321
TOTAL ASSETS	23,966,651	22,989,227	977,424
Share capital and equity reserve	(25,285,252)	(20,523,420)	(4,761,832)
Expected cash flow hedging op. reserve	(556,610)	(50,334)	(506,276)
Shareholders' equity	(25,841,862)	(20,573,754)	(5,268,108)
Medium to long-term financial position	(5,002,537)	(7,358,338)	2,355,801
Short-term financial position	6,877,748	4,942,866	1,934,882
Net Financial Position	1,875,211	(2,415,472)	4,290,683
EQUITY AND NET FINANCIAL POSITION	23,966,651	22,989,226	977,425

FOPE SPA INCOME STATEMENT

Euro	31/12/2021	31/12/2020	Change
Revenue	38,956,888	26,334,154	12,622,734
Other revenue and income	299,025	429,001	(129,976)
External costs	(26,597,609)	(20,305,485)	(6,292,124)
Added value	12,658,304	6,457,670	6,200,633
Personnel costs	(2,993,348)	(2,363,882)	(629,465)
EBITDA	9,664,956	4,093,788	5,571,168
Depreciation and amortisation	(1,964,536)	(1,565,312)	(399,224)
EBIT	7,700,420	2,528,476	5,171,944
Financial income and charges	49,458	(269,604)	319,062
Pre-tax profit	7,749,879	2,258,872	5,491,006
Earnings before Tax	(2,088,021)	(373,990)	(1,714,031)
Net profit	5,661,857	1,884,882	3,776,975

FOPE SPA BALANCE SHEET

Euro	31/12/2021	31/12/2020	Change
Net intangible fixed assets	2,928,004	3,389,761	(461,757)
Net tangible fixed assets	9,508,877	10,027,790	(518,913)
Holdings/equity and other financial fixed assets	134,118	134,118	0
Non-current assets	12,570,999	13,551,669	(980,670)
Warehouse stock	9,184,653	8,139,172	1,045,481
Trade receivables	5,322,440	4,836,576	485,864
Subsidiaries Receivables	6,942,412	1,231,372	5,711,040
Current receivables	675,906	830,055	(154,149)
Cash flow hedging op. cr. position	794,993	419,932	375,061
Short-term assets for the year	22,920,404	15,457,107	7,463,297
Trade payables	3,672,818	2,278,224	1,394,594
Subsidiaries Payables	248,918	204,743	44,175
Current liabilities	2,932,018	742,539	2,189,479
Short-term liabilities for the year	6,853,754	3,225,506	3,628,248
Net Working Capital	16,066,650	12,231,601	3,835,049
Severance pay Fund	(1,006,788)	(953,534)	(53,254)
Agencies indemn.Fund and Other	(1,380,187)	(1,377,865)	(2,322)
Hedging op.Fund	(21,931)	(352,521)	330,590
TOTAL ASSETS	26,228,743	23,099,350	3,129,393
Share capital and equity reserve	(25,536,264)	(20,473,923)	(5,062,341)
Expected cash flow hedging op. reserve	(556,610)	(50,334)	(506,276)
Shareholders' equity	(26,092,874)	(20,524,257)	(5,568,617)
Medium to long-term financial position	(5,002,537)	(7,358,338)	2,355,801
Short-term financial position	4,866,668	4,783,245	83,423
Net Financial Position	(135,869)	(2,575,093)	2,439,224
EQUITY AND NET FINANCIAL POSITION	26,228,743	23,099,350	3,129,393