Gefran — Annual Report 2025

Mar 31, 2026

Notice of call	4	3. Environmental information	207
Letter from the Chairwoman and Chief Executive Officer	6	3.1. Information pursuant to the European Taxonomy Regulation
		(EU Regulation 2020/852)	208
ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2025	8	3.2. ESRS E1 Climate change	222
		3.3. ESRS E5 Resource use and circular economy	254
Highlights	10	4. Social information	276
Corporate Bodies	12	4.1. ESRS S1 Own workforce	278
Key consolidated income statement and statement of financial position figures	13	4.2. ESRS S2 Workers in the value chain	317
Key ESG performance indicators	14	4.3. ESRS S4 Consumers and end users	323
		5. Governance Information	330
Report on operations – Profile of the Group	16	5.1. ESRS G1 Business conduct	336
1. Group Structure	18	Certification of the Sustainability Report pursuant to Article 81-ter, paragraph 1, of Consob Regulation
2. Gefran Group Activities	19	no. 11971 of 14 May 1999 as amended	353
3. Breakdown of the Group's main activities	20
4. Strategy	23	Consolidated financial statements	354
5. Research and development	24
6. Environment, health and safety	27	Specific explanatory notes to the accounts	364
7. Information on shareholders and stock performance	30
8. Alternative performance indicators		Annexes
	34		444
9. Disclosure simplification	36	Certification of consolidated financial statements pursuant to Article 81-ter
10. Disposizioni di cui all'articolo 15 del Regolamento Mercati Consob	37	of Consob regulation no. 11971 dated 14 May 1999, as amended	451
Report on operations - Information on activities		GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2025
	38		452
1. Gefran consolidated results	40	Report on Operations of Gefran S.p.A.
2. Investments	58		454
3. Human resources	60	1. Gefran S.p.A. Results	456
4. Results by business area	64	2. Gefran S.p.A. human resources	462
4.1. Sensors business	65	3. Environment, health and safety in Gefran S.p.A.	464
4.2. Automation components business	70	4. Significant events in Gefran S.p.A. in 2025	466
5. Significant events in 2025	76	5. Significant events in Gefran S.p.A. after year end	468
6. Significant events after the end of 2025	79	6. Outlook for Gefran S.p.A.	469
7. Outlook	80	7. Gefran S.p.A.'s own shares	470
8. Own shares	82	8. Gefran S.p.A.'s dealings with related parties	471
9. Dealings with related parties	83	9. Main risks and uncertainties in Gefran S.p.A.	472
		10. Disclosure simplification	473
Report on operations – Disclosure of risks and		11. Proposed resolution	474
uncertainties to which the Gefran Group is exposed	84
1. Risks associated with countries and markets	97	Financial Statements of Gefran S.p.A.	476
2. Financial Risks	100
3. Strategic Risks	103	Specific explanatory notes to the accounts of Gefran S.p.A.	486
4. Governance and integrity risks	105	Certification of annual financial statements under Article 81-ter of Consob Regulation
5. Operating risks and reporting risks	106	no. 11971 of 14 May 1999 as amended	544
6. Legal and compliance risks	108
7. IT risks	109	External Auditor's Report on the consolidated financial statements	546
8. Risks associated with human resources	110
9. ESG Risks	111	External Auditor's Report on the Sustainability Report	554
Report on Operations – Sustainability Report	114	External Auditor's Report on the Annual Financial Statements of Gefran S.p.A.	560
1. Introduction to Gefran Group's Sustainability Report	116
2. General disclosures	119	Board of Statutory Auditors' Report to the Shareholders' Meeting of Gefran S.p.A.	568
2.1. ESRS 2 General disclosure	120

NOTICE OF CALL

The notice of call to the Shareholders' Meeting that will be called to approve the annual financial statements as at 31 December 2025 is available on the Company's website (www.gefran.com) in the section Investor/Governance/ Shareholders' meetings (at https://www.gefran.com/governance/shareholders-meetings/).

Below are the agenda items relating to the approval of the annual financial statements as of 31 December 2025 and the allocation of profit for the year.

1. Annual financial statements for the year ending 31 December 2025.

Approval of the annual financial statements as of 31 December 2025, complete with the Report on Operations of the Board of Directors, the Report of the Board of Statutory Auditors and the External Auditor's Report. Presentation of the consolidated financial statements for the year ending on 31 December 2025. Presentation of the Sustainability Report prepared pursuant to Italian Legislative Decree 125/2024. Related and consequent resolutions.

• 2. Approval of the proposal for distribution of dividends. Related and consequent resolutions.
• 3. Allocation of profit for the year ending on 31 December 2025.

Allocation of the remaining portion of profit for the year. Related and consequent resolutions.

Annual Financial Report at 31 december 2025 Gefran Group

LETTER FROM THE CHAIRWOMAN AND CHIEF EXECUTIVE OFFICER

Among the investments launched during the year, we are proud to highlight the start of work on the new production and technological hub in Provaglio d'Iseo, which gives concrete shape to the long-term vision of Gefran's second generation and views the workspace as a strategic lever for growth, innovation and quality.

In 2025, our commitment to strengthening internal control, risk management and audit activities, and to optimising production and logistics processes remained constant, ensuring high standards of governance, quality and operational effectiveness. During the year, we continued to focus on a sustainable future, expanding reporting according to the Corporate Sustainability Reporting Directive and the ESRS standards, consolidating an ESG path that involves all the Group's companies and which is a central pillar of our Industrial Plan.

Lastly, Gefran's stock showed a solid performance last year, with an increase above the average for the Euronext STAR Milan segment, and remained among the most resilient industrial mid-caps in the sector.

In the second half of the year, a peak of €12.90 was reached on 6 October, a sign of strong market appreciation.

During the same period, ANIMA SGR notified the market that it had exceeded the 5% ownership threshold. The last quarter experienced a normal consolidation phase, with prices stabilising in the €10.35–€10.55 range, while maintaining a valuation above the levels at the beginning of the year and confirming the structural strengthening of the stock in the medium term.

No own shares were purchased during 2025 and, at the end of the year, Gefran S.p.A. held 198,405 shares.

The dividend that the Board of Directors has resolved to distribute and which will be proposed to the Shareholders' Meeting is 0.43 Euro per share, in line with last year.

2025 was thus the expression of a solid, resilient and future-oriented Group in which every result derives from the quality and effectiveness of the decisions made and the commitments with which we face challenges and turn opportunities into value. Being aware of our qualities, the priority for 2026 is once again market development, and therefore our investment guidelines supporting factory automation and the development of personnel skills, both in Italy and abroad, remain unchanged.

We wish to sincerely thank you for your trust, support and solidarity, which enable us to continue building value, innovation and sustainable growth for Gefran's future.

Chairwoman

Maria Chiara Franceschetti

Chief Executive Officer

Marcello Perini

Dear Shareholders,

2025 was a year of consolidation and strengthening for our Group, in a complex macroeconomic context marked by global uncertainties and discontinuous trends in the relevant industrial sectors. In this scenario, Gefran was able to maintain full consistency in the implementation of its strategic guidelines, operational continuity and financial strength, confirming its ability to grow even in unfavourable conditions.

Orders recorded a positive trend compared to the previous year and revenues showed a moderate yet significant increase. The backlog, which remained at high levels, testifies to the resilience of demand and the continued confidence of the market in our offering.

Revenue growth was mainly driven by the sensors business, by expansion in Asian markets and recently completed acquisitions.

In particular, the sensors business recorded significant growth in most of the geographical regions served by the Group, with particularly positive performance in Italy and the Asian markets, where the expansion of demand and the strengthening of the commercial network produced better-than-expected results. On the other hand, the results of the automation components business were negatively affected by two significant factors: the slowdown in global investments and the general weakening of foreign currencies against the euro.

Geographically, 2025 showed very different dynamics: our European subsidiaries, excluding Italy, posted a general contraction in demand, while Asia experienced significant growth, mitigated, when looking at consolidated data, by exchange rate fluctuations. The industrial outlet sectors also showed heterogeneous development, with sales in the plastics sector fuelled by significant projects in the polymer world, and the Mobile Machines sector benefiting from the return to normality of its customer base, with particularly promising prospects for the years to come.

As regards extraordinary transactions, our acquisitions and shareholdings, particularly in the field of industrial digitalisation, continued the process of expanding the Group's scope, strengthening our ability to offer increasingly complete solutions focused on the value of data and smart applications.

During 2025, the Group well managed the pressure on margins, influenced both by external factors, such as the decline in sales prices and unfavourable exchange rates, and by internal factors, including increased personnel costs and incremental investments in research and development. The latter, while having a limited impact in the short term, represent a strategic choice that is needed to support future competitiveness. This further confirms Gefran's ability to adapt and react effectively to market challenges, maintaining a long-term focus and vision.

Also the Group's overall investments showed great consistency with our strategy of developing and strengthening industrial capacity, remaining at a high level supported by positive cash on hand, confirming the Group's financial strength and the possibility of supporting new projects, innovation, and, lastly, growth.

ANNUAL FINANCIAL REPORT AT 31 DECEMBER 2025

REPORT HIGHLIGHTS REPORT ON OPERATIONS – PROFILE OF THE GROUP

HIGHLIGHTS

Annual Financial Report at 31 december 2025 Gefran Group

CORPORATE BODIES

Board of Directors

Chairwoman Maria Chiara Franceschetti Vice Chairwoman Giovanna Franceschetti Director Alessandra Maraffini (*)

Chief Executive Officer Marcello Perini Director Andrea Franceschetti Director Enrico Zampedri (*) Director Cristina Mollis (*) Director Giorgio Metta (*) Director Luigi Franceschetti

(*) Independent directors pursuant to the Consolidated Law on Finance (TUF) and the Corporate Governance Code

Board of Statutory Auditors

Chairman Giorgio Alberti Standing auditor Roberta dell'Apa Standing auditor Luisa Anselmi

Deputy auditor Simona Bonomelli Deputy auditor Simonetta Ciocchi

Control and Risks Committee

Alessandra Maraffini Luigi Franceschetti Enrico Zampedri

Appointments and Remuneration Committee

Cristina Mollis Giorgio Metta Enrico Zampedri

Sustainability Committee

Giovanna Franceschetti Marcello Perini Cristina Mollis

External Auditor

Deloitte & Touche S.p.A. On 23 April 2024, the ordinary Shareholders' Meeting of Gefran S.p.A. engaged the External Auditor Deloitte & Touche S.p.A. to audit the annual financial statements of Gefran S.p.A., as well as the consolidated financial statements, the sustainability report and the consolidated half-yearly report of the Gefran Group for a period of nine years until the approval of the financial statements for 2033, in accordance with Italian Legislative Decree no. 39/2010.

The full description of the roles and activities performed by the administrative, management and supervisory bodies is provided in the Report on Operations in the section General disclosures – Group governance.

KEY CONSOLIDATED INCOME STATEMENT AND STATEMENT OF FINANCIAL POSITION FIGURES

Group income statement highlights

(Euro /000)		31 December2025		31 December2024		4Q 2025		4Q 2024
Revenues			138,964 100.0% 132,607 100.0% 33,834 100.0% 32,008 100.0%
Profit	22,443		16.2% 23,056	17.4%	3,586	10.6%	3,648	11.4%
EBIT	14,333	10.3%	15,125	11.4%	1,518	4.5%	1,670	5.2%
Profit (loss) before tax	13,620	9.8%	15,353	11.6%	1,679	5.0%	2,009	6.3%
Net profit (loss)	9,869	7.1%	11,142	8.4%	1,069	3.2%	1,050	3.3%
Attributable to:
Group	9,869	7.1%	11,142	8.4%	1,099	3.2%	1,050	3.3%
Third parties	-	0.0%	-	0.0%	(30)	-0.1%	-	0.0%

Group statement of financial position highlights

(Euro /000)	31 December 2025	31 December 2024
Invested capital from operations	67,987	65,183
Net working capital	19,627	20,216
Shareholders' equity	100,829	99,338
Group Shareholders' equity	100,829	99,338
Shareholders' equity of minority
interests	-	-
Net debt relating to operations	32,842	34,155

(Euro /000)	31 December 2025	31 December 2024
Operating cash flow from	23,267	26,657
operationsInvestments in operations	9,388	6,363

KEY ESG PERFORMANCE INDICATORS

10.381 tCOe SCOPE 3 relating to the categories: purchased goods and services, capex, energy-related activities, upstream and downstream transportation, business travel

14 15

REPORT ON OPERATIONS PROFILE OF THE GROUP

Annual Financial Report at 31 december 2025 Gefran Group

GEFRAN GROUP ACTIVITIES

The Gefran Group's business is centred around two main business areas: industrial sensors and automation components.

Design, production and commercialization activities are carried out through various sales channels, offering a complete range of products and solutions that can be applied in multiple automation sectors. About 68% of revenues are generated abroad.

Sensors business

The sensors business offers a complete range of products for measuring four physical parameters of position, pressure, force and temperature - which are used in many industrial sectors.

Gefran stands out for its technological leadership, creating in-house the primary elements, offering a complete range that is unique in the world and occupying leading positions worldwide for some product families. The sensors business generates about 79% of its revenues abroad.

Automation components business

The automation components business develops around three main product lines that are widely used in the control of industrial processes: instrumentation, power control and automation platforms (operator panels, PLC, I/O modules). In addition to the supply of products, Gefran offers its customers the possibility of designing the entire automation solution, providing "tailor-made" and "turnkey" solutions, thanks to a strategic partnership both during the design and production stages.

Gefran stands out for its expertise in hardware and software acquired in over thirty years of experience. Gefran is one of the main Italian manufacturers in these product lines and generates around 41% of its business revenues through exports.

It should be noted that, as described in Significant events after the end of 2025, on 23 February 2026 Gefran S.p.A. acquired the remaining 40% of the shares in CZ Elettronica S.r.l., thereby holding 100% of the Company.

20

BREAKDOWN OF THE GROUP'S MAIN ACTIVITIES 3

Company	Production ofsensors	Production ofautomationcomponents	Central services	Marketing
Gefran S.p.A.	×	×	×	×
Gefran Soluzioni S.r.l.		×		×
Elettropiemme S.r.l.		×		×
CZ Elettronica S.r.l.		×		×
Gefran Inc.	×			×
Gefran France S.A.				×
Gefran Deutschland GmbH				×
Gefran Brasil Eletroeletrônica Ltda.		×		×
Gefran UK Ltd.				×
Gefran Benelux N.V.				×
Gefran Asia Pte. Ltd.				×
Gefran Automation Technology
(Shanghai) Co. Ltd.	×			×
Gefran India Private Ltd.				×
Gefran Schweiz AG	×			×
Axel S.r.l.		×		×
Robot At Work S.r.l.		×		×
40Factory S.r.l.		×		×

A brief description of Gefran S.p.A. and the Gefran Group subsidiaries included in the scope of consolidation, with their main characteristics as of 31 December 2025, is

provided below.

The Parent Company Gefran S.p.A., with its registered office in Provaglio di Iseo (BS), Italy, is controlled by Fingefran S.r.l. Gefran S.p.A includes the following divisions: sensors, automation components as well as central support functions such as procurement, logistics, administration, finance, control, legal, public relations, Information Technology systems and human resources. It operates through its sites in Via Sebina, Via Cave and Via Galvani, all in Provaglio di Iseo (BS).

Gefran Soluzioni S.r.l., with its registered office in Provaglio d'Iseo (BS), is 100% directly controlled by the Parent Company. It was created in April 2015 by the spinoff of the company branch of Gefran S.p.A. relating to the design and production of systems and panels for industrial automation. On 23 January 2019 it purchased 100% of the shares in Elettropiemme S.r.l. (previously owned by Ensun S.r.l., which is in turn already 50% owned by Gefran S.p.A.).

Elettropiemme S.r.l., with its registered office in Trento, is 100% owned directly by Gefran Soluzioni S.r.l. and indirectly by Gefran S.p.A. It is concerned with the design, production and installation of electrical panels and equipment, photovoltaics and energy efficiency

equipment.

CZ Elettronica S.r.l., with its registered office in Monticello Conte Otto (VI), is 60% owned by Gefran S.p.A. Acquired on 14 April 2025, together with its subsidiary Mecatronica S.r.l., which was later incorporated into the parent company, CZ Elettronica S.r.l. specialises in the development of custom solutions for turnkey installations in the steel, textile and plastic sectors, and manufactures systems for regulating industrial motorisation. It should also be noted that, as described in Significant events after the end of 2025, on 23 February 2026 Gefran S.p.A. acquired the remaining 40% of the shares in CZ Elettronica S.r.l., thereby holding 100% of the Company.

Gefran Inc., with its registered office in Charlotte (NC), USA, is 100% directly owned by the Parent Company and operates in its production facility in North Andover (MA), where Melt pressure sensors are made, for which it is one of the leading producers in the US. It sells its own products in North America, as well as the Gefran Group's sensors and automation components products.

Gefran France S.A., with its registered office in Saint-Priest, France, is 99.9% directly owned by the Parent Company. It sells the Gefran Group's sensors and automation components products in France.

Gefran Brasil Eletroeletrônica Ltda., with its registered office in Sao Paulo, Brazil, is 99.9% controlled by the Parent Company, with the remaining 0.1% controlled indirectly through Gefran Schweiz AG. Gefran Brasil sells sensors and automation components products and has an assembly line for regulators and static units serving the local market.

Gefran Deutschland GmbH, with its registered office in Seligenstadt, Germany, is 100% owned by the Parent

THE GEFRAN GROUP IS EXPOSED

22 23

Company. Gefran Deutschland sells sensors and automation components in Germany and Austria, Europe's main market for equipment manufacturers.

Gefran Benelux N.V., with its registered office in Olen, Belgium, is 100% directly owned by the Parent Company. In addition to the Gefran sensors and components, it also sells in Benelux commercialized products dedicated to the oil installations sector.

Gefran Schweiz AG, with its registered office in Aadorf, Switzerland, is 100% directly owned by the Parent Company. Acquired in 2013, it took on its current form in 2014, following the merger by incorporation of Gefran Suisse SA and the subsequent change of its name (until 31 March 2025, it was Sensormate AG). The company produces load cells, strategic sensors completing the Group's range in the business line. It also sells Gefran sensors and automation components in Switzerland.

Gefran UK Ltd., with its registered office in Warrington, United Kingdom, is 100% directly owned by the Parent Company. It focuses on the sale of sensors and automation components in the UK.

Gefran Asia Pte. Ltd., with its registered office in Singapore, is 100% directly owned by the Parent Company and distributes Gefran's entire product range.

Gefran Automation Technology (Shanghai) Co. Ltd., with its registered office in Shanghai, China, is 100% owned by Gefran Asia Pte. Ltd. and indirectly owned by Gefran S.p.A. Since 2009, it has been assembling certain lines of sensors, mainly for the local market. The company branch dedicated to the design, production and sale of motion control products (in operation from 2004 to 2022), was sold on 3 January 2023 to WEG (Changzhou) Automation Equipment Co. Ltd, the Chinese subsidiary of the WEG Group.

Gefran India Private Ltd., with its registered office in Pune, India, is 99.975% directly controlled by the Parent Company, with the remaining 0.025% controlled indirectly through Gefran Schweiz AG. The company distributes Gefran products in India. It should also be noted that from 2016 to 2022 it assembled motion control products intended for the lifting market in India, a business branch sold on 1 March 2023 to WEG Industries (India) Private Ltd., the Indian subsidiary of the WEG group.

The main associates at 31 December 2025 include:

/ Axel S.r.l., with its registered office in Dandolo (VA), a company concerned with the production and sale of application software for industrial automation, of which Gefran S.p.A. holds 15% of the share capital.

/ Robot At Work S.r.l., with its registered office in Rovato (BS), a company that carries out the design, construction, sale and installation of industrial plants, including standard robotic cells, collaborative cells (which require the presence of an operator and industrial automation), visual control and Virtual Commissioning; Gefran S.p.A. currently holds 24.83% of its share capital.

/ 40Factory S.r.l. with operational headquarters in Piacenza, a scale-up tech that offers manufacturers of industrial machines and end-users an Industrial loT (Internet of Things) platform for the collection and use of plant data and that owns a generative artificial intelligence system dedicated to providing support in the use of industrial machines; Gefran S.p.A. currently holds 22% of its share capital.

The 2025 results confirm the growth path undertaken by the Group in recent years, in continuity with the 2024 Annual financial report. In a global context still marked by geopolitical uncertainties and mixed demand dynamics, the Group was able during the year to consolidate its competitive position thanks to geographical diversification and a constant focus on operational efficiency.

Operational management continued along the strategic lines defined in the Industrial Plan, with targeted modulation of costs, investments and organisational initiatives. Developments in international markets – in particular, buoyant demand from Asia, already evident in 2024 – continued to support growth, offsetting weakness in some Western industrial sectors.

With regard to revenue development, 2025 saw a further strengthening of our commercial structures and an expansion of our technical expertise, with a growing focus on high-potential industrial sectors (plastics, mobile machinery, metal, glass and semiconductors), already identified as priorities in 2024. Consistency between the evolution of our product portfolio and the needs of the target markets was a decisive factor in the Group's competitiveness.

Innovation continued to be a strategic pillar: investments in research and development, maintained also in 2025 in continuity with previous years, supported the introduction of solutions oriented to digitisation, safety and energy efficiency of industrial machinery. The growing integration of digital systems and platforms meant that the contribution from our participation in the scale-up 40Factory was enhanced, favouring the evolution towards data-driven services capable of generating added value for customers in the context of Industry 5.0.

The core principles on which the Group's competitiveness is based remain unchanged: vertical integration of manufacturing processes, technological oversight of internal know-how and continuous development of personnel skills, both in Italy and abroad. These elements are combined with the pillars of our sustainability strategy, fully integrated into management and reporting, which guide our industrial and organisational choices and represent an enabling factor for value creation in the medium-long term.

Annual Financial Report at 31 december 2025

5 RESEARCH AND

DEVELOPMENT

The Gefran Group invests significant financial and human resources in product research and development. In 2025, 5.3% of revenues were invested in these activities, which are considered strategic to maintain high technological and innovative levels in products, ensuring the competitiveness required by the market.

Research and development is mainly concentrated in Italy and managed by the technical area. It includes development of new technologies, evolution of the characteristics of existing products, product certification in addition to the design of custom products at the request of specific customers. The activities carried out in the laboratories of the Group's historic headquarters in Provaglio d'Iseo (BS) are now complemented by the technological hub dedicated to force and deformation sensors at the laboratories of the Swiss branch Gefran Schweiz AG, a new R&S office dedicated to magnetostrictive sensors in the new laboratories of the German branch Gefran Deutschland GmbH, located near Stuttgart, as well as an R&S function at the Chinese production branch Gefran Automation Technology.

The cost of technical personnel involved in these activities, as well as for consultancy and the purchase of materials used for testing, is charged in full to the income statement, except for costs that are capitalised according to the conditions set out in IAS 38. Costs identified for capitalisation and that meet the above requirements are indirectly suspended by a revenue entry under "Increases for internal work" in the income statement.

In 2025, the technical area of the sensors business directed its research and development activity at further expanding the product offering, focusing on the range dedicated to mobile hydraulics sensors and on the launch of sensors with digital connectivity for use in Industry 4.0 architecture. These developments are consistent with the main business drivers identified by the Group, specifically:

/ focus on strategic vertical markets and related segments: mobile machinery (in particular: railways and

/ global reliability and compliance: products developed to meet strict international standards, increasing credibility in the most regulated sectors (rail,

• agriculture), plastics (polymers, machinery);
• explosion-proof);
• a view to operator safety;
• market.

/ continuous technological innovation: technology upgrades and expansion of the range of sensors with

/ customer-centric design: sensors designed to easily integrate with solutions already installed on the

Specifically, with regard to pressure measurement, new versions of the KM probe (with solenoid valve connectors and micro-solenoid valve) were launched. On this basis, the KM sensor was developed with RAIL type-approval (in accordance with the EN50155 standard), with the aim of strengthening Gefran's offering in the railway application market.

In order to increase our market share in the agriculture sector, a new line of GR3P rotary sensors (with single output and 3 pin electrical connection) was launched in early 2025. The mechanics of this new sensor has been designed to ensure maximum flexibility and adaptability during installation, while the measurement technology incorporates the know-how of hall-effect sensor technology developed over previous years.

In the mobile machines sector, development activities continued during 2025 in order to meet the requirements for safety certifications (SIL2/PLd). This initiative, involving a significant part of Gefran's sensor portfolio, is the expression of its strategy to strengthen the Group's positioning in the mobile machinery market and offer customers the highest functional safety.

Lastly, in the plastics sector, and in particular the polymer market, the IECEX international certification for explosion-risk environments was obtained, in connection with high-temperature pressure (melt) sensors. This qualification was also the basis for achieving the NEPSI certification, mainly intended for the Asian market.

THE GEFRAN GROUP IS EXPOSED

27

26

Annual Financial Report at 31 december 2025

During 2025, research and development of automation components focused heavily on the ranges of programmable automation and power controllers, in line with the strategic development guidelines already identified in previous years, while also launching the first projects for the renewal of our process control range (temperature controllers).

G-Mation, the new programmable automation platform, was launched in the second quarter of the year. Gefran renewed its presence in this market area with G-Mation P6, a new PLC unit that, combined with the GF Project 6.x application development software, offers machine manufacturers a high-performance, flexible and stateof-the-art solution. The G-Mation platform implements webserver and docker technologies and is designed to be in line with the latest cybersecurity regulations. To complete our offering, the CPU launch was enriched by the availability of six new input/output units alongside the six already made available last year.

In the second half of 2025, work was also carried out on the integration between G-Mation and the Industrial I/O and Generative AI solutions of 40Factory S.r.l., a technology company in which Gefran S.p.A. acquired a stake in the first quarter of 2025. During the third quarter of 2025, the Gefran automation board offering was enriched by two additional new I/O units.

In the field of power control, on 30 September 2025 the first part of the range of the new series of advanced GRC power controllers was launched, with sizes from 25A to 150A in single-, bi- and three-phase versions. This series offers the market a more mechanically compact and economical solution, combined with advanced features such as improved metrology, field buses with higher speeds and payload capacities, and new feedback algorithms. In 2026 the development of the series will go ahead with new sizes and functions, including integrated smart load management (GSLM) and Digital Twin-based diagnostics.

In the area of process control, updates to the PIDbased control algorithms for GFX Termo4 controllers continued. The same algorithms will also be included in the Performance series controllers in 2026. These controllers will also have their communication options expanded, with the introduction of the Profinet protocol in 2026. Since October 2025, development activities have been underway on a new modular and expandable control platform, designed to manage 2 to 64 control channels. This project remains the most relevant for the control area in 2026.

6ENVIRONMENT, HEALTH AND SAFETY

Gefran realises that the team spirit of all the workers who consistently share its organisation, goals and strategies, has made a major contribution to its success.

The health and safety of workers, of third parties working permanently on the company's premises, and of everyone working under the company's control is a matter of primary importance for the effective, orderly pursuit of the company's general goals and the specific goals of various company functions. As regards the environment and the impact of its activities, the Group is committed to increasing environmental awareness, striving to achieve a constant balance between business activities and the management of their impacts on the environment, in all fields of application.

Protection of employees' safety, health and well-being and the environment are key values in the organisation of the Group's activities, so as to create added value for all its internal and external Stakeholders. This commitment is confirmed and signed through the "Health, Safety and Environment" policy, covering the entire Group, which outlines the principles guiding management of these issues:

• / operate in compliance with the applicable legislation on health, safety at work and the environment, adopting the highest international management standards and pursuing the continuous improvement of its HSE performance;
• / identify hazards and assess risks associated with work activities, eliminating them where possible or, alternatively, reducing them through adequate collective and individual prevention and protection measures;
• / develop and implement emergency management plans, with the aim of preventing and limiting personal injuries and environmental damage in the event of accidents;
• / promote a culture of safety and respect for the environment, empowering, training and motivating employees at all levels of the organisation

through continuous development and information programmes;

• / clearly define, update and communicate roles, responsibilities and procedures in the field of health, safety and the environment, ensuring they are fully understood within the organisation;
• / optimise the use of energy resources and raw materials, preventing pollution by identifying, monitoring and reducing the environmental impacts of processes and products;
• / responsibly manage the supply chain, including compliance with HSE requirements among the criteria for the selection, evaluation and management of suppliers, also through specific contractual provisions;
• / require suppliers to adopt management systems consistent with those of the Group, in compliance with international and local rules and laws on the environment, health and safety at work.

The Quality, Safety and Environment team actively participates in identifying and managing the impacts, risks and opportunities related to HSE issues relevant to Gefran, contributing to the consolidated Sustainability Report, including through the periodic monitoring of performance indicators, which is necessary to verify the effectiveness of the actions taken with respect to the objectives defined. The Group's key performance indicators for relevant HSE topics are described in the specific paragraphs of the Sustainability Report included in this Report on Operations, in the sections Environmental information and Social information.

The objectives set and the ways in which they are reached are globally endorsed at all levels, shared and periodically verified. In 2023 an important milestone was reached, represented by the Group obtaining certifications for all its Italian sites according to the following standards:

• / ISO 14001:2015, relating to the Environmental Management System;
• / ISO 45001:2018, relating to the Occupational Health and Safety Management System;
• / SA 8000:2014, for Social Accountability.

Obtaining a certified integrated management system, including not only Quality management (according to the ISO 9001:2015 standard) but also miscellaneous HSE areas, is one of the objectives of the Gefran Group's Strategic Sustainability Plan. The project has gone ahead, aiming to extend the System to the other production entities of the Group, based on the model developed.

During the last two years, the activities necessary to structure the Integrated Management System in foreign branches were carried out, with the support of professionals experienced in the regulations applying in the various countries, in preparation for certification audits conducted by third parties. The audits were carried out in December 2025 and January 2026, allowing the production sites in China, the United States and Switzerland to integrate the Management System and also be ISO 14001:2015 and ISO 45001:2018 certified.

In 2025, training continued at various levels in order to increase awareness of health and safety issues in the workplace, both leveraging internal skills and with the support of an external team of professionals in the sector. The prevention of occupational illness and injury through analysis of historic data, risk assessment, good practice in the sector, and accurate analysis of accidents, near-misses and potentially hazardous situations, remained a central issue.

This approach to reducing environmental risks and focus on climate change characterises the Group's operations. Although it is considered a "non-energy" company, thirdparty audits and systematic monitoring of energy consumption have highlighted the areas in which energy is most used. This has made it possible to identify priorities for action, optimising investments. The energy efficiency plan has resulted in various activities, including:

/ the gradual replacement of old fluorescent tube light fixtures with LED lamps; the same technology is now the standard used in the redevelopment of areas and in the

/ the replacement of plant and machinery with energy-ef-

• construction of new buildings;
• ficient equipment;
• (both in Italy and abroad);

/ the installation of photovoltaic systems for the production of electricity at miscellaneous group sites

/ the use of electricity produced from certified renewable sources, through the signing of supply contracts with certificates of origin (both in Italy and abroad);

/ the installation of charging points for electric cars, which can be used by company vehicles.

Waste management is an aspect to which Gefran pays close attention, focusing its activities on minimising impacts on the environment and on people. On the basis of the precise data collected with regard to the waste produced (deriving both from processing and the separate collection of municipal waste) and its different types, actions are planned to reduce the proportion of hazardous waste and the categories of waste intended for disposal, with the aim of maximising the principles of recovery and recycling.

The related policies, actions, targets and metrics are described in the specific sections of the Sustainability Report included in this Report on Operations.

Annual Financial Report at 31 december 2025 Gefran Group

INFORMATION ON SHAREHOLDERS AND STOCK PERFORMANCE

On 31 December 2025, the subscribed and paid-up share capital was 14,400,000.00 Euro, divided into 14,400,000 ordinary shares, with a nominal value of 1.00 Euro per share. No further financial instruments have been issued.

7

STRUCTURE OF SHARE CAPITAL

Type of shares		No. of shares % of share capital	Listed	Rights andobligations
Ordinary shares	14,400,000		100 Euronext STAR MILAN	ordinary

The Parent Company Gefran S.p.A. has been listed on the Milan Stock Exchange since 9 June 1998, and in 2001 joined the "STAR" (Segmento Titoli con Alti Requisiti) segment of the Automated Stock Market for small to mid-sized companies that meet specific transparency, liquidity and corporate governance requirements. On 31 January 2005 this segment was renamed ALL STARS, taking on the name FTSE Italia STAR following the 1 June 2009 merger of Borsa Italiana with the London Stock Exchange before being given its current name, Euronext STAR Milan.

Chart updated as at the date of the last dividend distribution (May 2025)

Share performance and volumes traded

The performance of the stock and volumes traded in the last 12 months are summarised below:

Gefran Group

34

Alternative indicators used in the notes to the statement of financial position are:

/ Net non-current assets: the algebraic sum of the following items in the statement of financial position:

• − Goodwill
• − Intangible assets
• − Property, plant, machinery and tools
• − Shareholdings valued at equity
• − Equity investments in other companies
• − Receivables and other non-current assets
• − Deferred tax assets

/ Working capital: the algebraic sum of the following

items in the statement of financial position:

• − Inventories

• − Trade receivables

• − Trade payables

• − Other assets

• − Tax receivables

• − Current provisions

• − Tax payables

• − Other liabilities

• / Net invested capital: the algebraic sum of net fixed assets, working capital and provisions;

• / Net financial position: the algebraic sum of the following items:

• − Medium to long-term financial payables

• − Short-term financial payables

• − Financial liabilities for derivatives

• − Financial assets for derivatives

• − Non-current financial assets

• − Cash and cash equivalents and short-term financial receivables

PERFORMANCE INDICATORS

In addition to the standard financial schedules and indicators required under IFRS, this document includes reclassified schedules and alternative performance indicators. These are intended to enable a better assessment of the Group's economic and financial management. However, these tables and indicators must not be considered as a substitute for those required under IFRS.

Specifically, the alternative indicators used in the notes to the income statement are:

• / Added value: the direct margin resulting from revenues, including only direct material, gross of other production costs, such as personnel costs, services and other miscellaneous costs;
• / EBITDA: this is EBIT before depreciation, amortisation and impairment. The purpose of this indicator is to present the Group's operating profitability before the main non-monetary items;
• − EBIT: operating result before financial management and taxes. The purpose of this indicator is to present the Group's operating profitability.

Annual Financial Report at 31 december 2025 Gefran Group

On 1 October 2012, the Board of Directors of Gefran S.p.A. resolved to make the election for disclosure simplification envisaged in article 70, paragraph 8, and article 71, paragraph 1-bis, of Consob Regulation no. 11971/1999 as amended.

DISCLOSURE SIMPLIFICATION 10

PROVISIONS UNDER ARTICLE 15 OF THE CONSOB REGULATION ON MARKETS

With reference to the "Conditions for listing of shares of parent companies of companies established and regulated by laws of countries not belonging to the European Union" as set out in Article 15 of the Consob Regulation on Markets, it is to be noted that this applies to the subsidiaries Gefran Asia Pte Ltd (Singapore), Gefran Automation Technology Co Ltd (China), Gefran Inc (USA), Gefran Brasil Eletroelectronica Ltda (Brazil), Gefran UK Ltd. (UK) and Gefran Schweiz AG (Switzerland).

The Group also made the adjustments necessary to meet the conditions set out under paragraph 1 of the aforementioned Article 15, and there are procedural provisions in place designed to ensure they are maintained.

REPORT HIGHLIGHTS REPORT ON OPERATIONS – PROFILE OF THE GROUP

REPORT ON OPERATIONS - INFORMATION ON ACTIVITIES

REPORT ON OPERATIONS – DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

REPORT ON OPERATIONS INFORMATION ON ACTIVITIES

Annual Financial Report at 31 december 2025 Gefran Group

1 GEFRAN CONSOLIDATED RESULTS

It should be noted that the Group's results, described and commented on below and referred to the current year, reflect the corporate acquisitions described in the paragraph Significant events in 2025. Specifically:

• / the acquisition, signed on 20 March 2025 by Gefran S.p.A., of 22% of the share capital of 40Factory S.r.l. with operational headquarters in Piacenza, entered among shareholdings valued at equity;
• / the acquisition, signed on 14 April 2025 and recognised among the subsidiaries of Gefran S.p.A., of 60% of the share capital of CZ Elettronica S.r.l., together with its subsidiary Mecatronica S.r.l., both of which are based in the province of Vicenza;
• / the subsequent merger by incorporation, effective from 4 September 2025, of Mecatronica S.r.l. into CZ Elettronica S.r.l., formerly its parent company.

In addition, as described in the Significant events after the end of 2025, on 23 February 2026 Gefran S.p.A. acquired the remaining 40% of the shares in CZ Elettronica S.r.l., thereby holding 100% of the Company.

The following paragraphs describe the effects of such operations, where relevant and useful for understanding performance.

Consolidated income statement for the fourth quarter

The income statement for the fourth quarter of 2025 is shown below, compared with the income statement for the fourth quarter of 2024.

	4Q 2025	4Q 2024		Change2025-2024
(Euro /000)	Total	Total	Value	%
a Revenues	33,834	32,008	1,826	5.7%
b Increases for internal work	768	645	123	19.1%
c Consumption of materials and products	10,839	10,263	576	5.6%
d Added Value (a+b-c)	23,763	22,390	1,373	6.1%
e Other operating costs	6,153	6,034	119	2.0%
f Personnel costs	14,024	12,708	1,316	10.4%
g EBITDA (d-e-f)	3,586	3,648	(62)	-1.7%
h Depreciation, amortisation and impairment	2,068	1,978	90	4.6%
i EBIT (g-h)	1,518	1,670	(152)	-9.1%
l Gains (losses) from financial assets/liabilities	143	323	(180)	-55.7%
m Gains (losses) from shareholdings valued at equity	18	16	2	12.5%
n Profit (loss) before tax (i±l±m)	1,679	2,009		(330) -16.4%
o Taxes	(610)	(959)	349	36.4%
p Net profit (loss) (n±o)	1,069	1,050	19	1.8%
Attributable to:
Group	1,099	1,050	49	4.7%
Third parties	(30)	-	(30)

Revenues in the fourth quarter of 2025 amounted to 33,834 thousand Euro, as compared to 32,008 thousand Euro in the same period of the previous year, up by 1,826 thousand Euro (equal to 5.7%). The subsidiary CZ Elettronica S.r.l. joining the Group contributed to the increase in revenues, for a total amount of 232 thousand Euro, without which growth in the quarter would be 1,594 thousand Euro (5%).

Overall, without taking into account the negative effect of exchange rate fluctuations compared to the same period of the previous year, estimated at 624 thousand Euro, the growth in revenues for the quarter would be more significant (7.7%).

Analysing the order intake in the fourth quarter of 2025, compared to the figure for the same period in 2024, there was an increase (overall 7.3%), driven by an increase in the orders collected for the sensors business (+4.5%) and also those for the automation components business (+12.8%).

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

42 43

The table below shows a breakdown of revenues by geographical region in the fourth quarter.

		4Q 2025		4Q 2024		Change 2025-2024
(Euro /000)	Value	%	Value	%	Value	%
Italy	11,416	33.7%	10,413	32.5%	1,003	9.6%
European Union	7,741	22.9%	7,669	24.0%	72	0.9%
Europe non-EU	1,108	3.3%	982	3.1%	126	12.8%
North America	3,005	8.9%	3,393	10.6%	(388)	-11.4%
South America	1,399	4.1%	1,419	4.4%	(20)	-1.4%
Asia	9,070	26.8%	8,015	25.0%	1,055	13.2%
Rest of the	95	0.3%	117	0.4%	(22)	-18.8%
world
Total	33,834	100%	32,008	100%	1,826	5.7%

In the breakdown of quarterly revenues by geographical region, compared with the figure for the same period of the previous year, performance was good in Italy, which posted an increase (+9,6%), reflecting, among other things, the positive contribution of the operations described in the introduction (when considering the same scope of consolidation, revenues achieved in Italy in the fourth quarter of 2025 were in any case 7.4% higher than in the same period of the previous year).

Revenues in Asian countries also grew (+13.2%), despite the negative effect of exchange rate fluctuations compared to the fourth quarter of 2024 (net of which the increase in revenues in the region would be 18.1%), in addition to revenues in European countries (overall +2.3%). However, revenues went down in America (overall -8.5%), an area that was affected by the negative effect of foreign currency fluctuations (without which the decrease compared to the same period in the previous year would be more limited, i.e. -3.6%).

Below is a breakdown of revenues in the fourth quarter by business area in comparison with the same period in the previous year.

		4Q 2025		4Q 2024		Change 2025-2024
(Euro /000)	Value	%	Value	%	Value	%
Sensors	21,691	64.1%	19,986	62.4%	1,705	8.5%
Automationcomponents	14,154	41.8%	13,499	42.2%	655	4.9%
Eliminations	(2,011)	-5.9%	(1,477)	-4.6%	(534)	36.2%
Total	33,834	100%	32,008	100%	1,826	5.7%

Compared to the previous fourth quarter, revenues from the sensors segment increased overall by 8.5% in all the geographical regions reached by this business (except for America, which was affected by currency trends). With regard to the automation components segment, growth was more limited (4.9%), influenced, among others, by the revenues contributed by CZ Elettronica S.r.l. (a company acquired, together with its subsidiary Mecatronica S.r.l., in April 2025), whose operating activities fall within the segment in question. Without considering this contribution, the increase in revenues generated by the automation components segment would be 3.1% in the quarter compared to the same period in 2024. For further details on the economic performance of each segment, please see the paragraph Results by business area.

Increases for internal work in the fourth quarter of 2025 amounted to 768 thousand Euro (645 thousand Euro in the fourth quarter of 2024). This item mainly relates to the development costs of new products, such as internal costs for company IT systems, incurred during the period and capitalised.

Added value in the quarter amounted to 23,763 thousand Euro (22,390 thousand Euro in the same quarter of 2024), corresponding to 70.2% of revenues (70% in the fourth quarter of 2024). The increase in added value, totalling 1,373 thousand Euro (1,055 thousand Euro without considering the added value of the new subsidiary CZ Elettronica S.r.l. acquired in April 2025), mainly relates to the higher revenues achieved in the period, as described above, partially absorbed by higher customs duties (in particular linked to trade with the US subsidiary).

Other operating costs in the fourth quarter of 2025 amounted to 6,153 thousand Euro, an increase of 119 thousand Euro over the figure for the fourth quarter of 2024 (a 135 thousand Euro decrease net of the effect of the acquisitions described in the introduction), corresponding to 18.2% of revenues (18.9% in the fourth quarter of 2024). Overall, the upward change is due to higher costs for external work and professional services, as well as maintenance, partly offset by lower consultancy, advertising and trade fair costs.

Personnel costs during the quarter, amounting to 14,024 thousand Euro, were 1,316 thousand Euro higher than in the same period of 2024, when they amounted to 12,708 thousand Euro (without considering the higher costs for the acquisitions described in the introduction, personnel costs for the quarter would be 987 thousand Euro higher). In general, the increase reflects the higher impact of the salary increase provided for by the National Collective Bargaining Agreement of June 2024 for all employees at the Group's Italian sites as well as the increase in workforce numbers to support the execution of the Group's strategy. As a percentage of revenues, the ratio was 41.4% (39.7% in the fourth quarter of 2024). For details on the workforce and its changes, please see the paragraph Human Resources.

EBITDA in the fourth quarter of 2025 amounted to 3,586 thousand Euro (3,648 thousand Euro in the same quarter of 2024), corresponding to 10.6% of revenues (11.4% of revenues in the same period of 2024), which is lower than in the fourth quarter of 2024 by 62 thousand Euro (when considering the same scope of consolidation, there would be an increase in EBITDA of 203 thousand Euro). Higher operating costs, compared with the corresponding quarter, offset the positive contribution from sales volumes and the corresponding added value, which are higher in absolute terms than in the previous fourth quarter.

The item depreciation, amortisation and impairment in the quarter amounted to 2,068 thousand Euro,

compared with 1,978 thousand Euro in the same period of the previous year, an increase of 90 thousand Euro (70 thousand Euro net of amortisation/depreciation of the assets held by CZ Elettronica S.r.l.).

EBIT in the fourth quarter of 2025 was positive by 1,518 thousand Euro (4.5% of revenues), as compared to an EBIT of 1,670 thousand Euro in the same period in 2024 (5.2% of revenues), a decrease of 152 thousand Euro. When considering the same scope of consolidation, EBIT generated in the quarter would instead be 133 thousand Euro higher than in the fourth quarter of 2024. The change is the result of the same dynamics illustrated for EBITDA.

Income from financial assets/liabilities in the fourth quarter of 2025 amounted to 143 thousand Euro (in the fourth quarter of 2024, income totalling 323 thousand Euro was recorded), including:

• / financial income of 234 thousand Euro, including 229 Euro deriving from liquidity management (overall 362 thousand Euro in the fourth quarter of 2024);
• / financial charges payable on loans taken out by the Group, totalling 45 thousand Euro (234 thousand Euro in the fourth quarter of 2024);
• / negative result of differences in foreign currency transactions of 22 thousand Euro, as compared to a positive result of 199 thousand Euro for the fourth quarter of 2024;
• / financial charges on financial debts as a result of application of the new accounting standard IFRS 16 totalling 24 thousand Euro (22 thousand Euro in the fourth quarter of 2024).

It should be noted that the transactions described in the introduction affected this item in an insignificant manner.

Gains from shareholdings valued at equity in the quarter, amounting to 18 thousand Euro, reflect the results reported by the subsidiary Axel S.r.l. In the fourth quarter of 2024, gains totalled 16 thousand Euro.

Taxes had a negative balance of 610 thousand Euro in the quarter (as compared to a negative balance of 959 thousand Euro in the fourth quarter of 2024). They consist of:

46

Annual Financial Report at 31 december 2025

• / current tax charge of 141 thousand Euro (charge of 66 thousand Euro in the fourth quarter of 2024);
• / deferred tax assets and liabilities, on the whole negative for the amount of 469 thousand Euro (negative for the amount of 893 thousand Euro in the fourth quarter of 2024).

Group net profit in the fourth quarter of 2025 totalled 1,069 thousand Euro, as compared with a profit of 1,050 thousand Euro in the same period of the previous year, remaining substantially aligned (when considering the same scope of consolidation, there would be an increase of 220 thousand Euro compared to the net profit of 2024). The change relates to the decrease in EBIT and the negative financial performance compared with the same previous quarter, offset by the positive tax performance.

Group net profit in the fourth quarter 2025 was 1,099 thousand Euro, while the minority share was negative by 30 thousand Euro.

Progressive Consolidated Income Statement

The Group's results at 31 December 2025 are shown below, compared with those recorded at 31 December 2024.

	31 December2025	31 December2024		Change2025-2024
(Euro /000)	Total	Total	Value	%
a Revenues	138,964	132,607	6,357	4.8%
b Increases for internal work	2,225	2,148	77	3.6%
c Consumption of materials and products	41,715	39,325	2,390	6.1%
d Added Value (a+b-c)	99,474	95,430	4,044	4.2%
e Other operating costs	23,871	22,901	970	4.2%
f Personnel costs	53,160	49,473	3,687	7.5%
g EBITDA (d-e-f)	22,443	23,056	(613)	-2.7%
h Depreciation, amortisation and impairment	8,110	7,931	179	2.3%
i EBIT (g-h)	14,333	15,125	(792)	-5.2%
l Gains (losses) from financial assets/liabilities	(725)	189		(914) -483.6%
m Gains (losses) from shareholdings valued at equity	12	39		(27) -69.2%
n Profit (loss) before tax (i±l±m)	13,620		15,353 (1,733) -11.3%
o Taxes	(3,751)	(4,211)	460	10.9%
p Net profit (loss) (n±o)	9,869		11,142 (1,273) -11.4%
Attributable to:
Group	9,869	11,142	(1,273)	-11.4%
Third parties	-	-	-

Revenues at 31 December 2025 amounted to 138,964 thousand Euro, compared to 132,607 thousand Euro in the same period of the previous year, up by 6,357 thousand Euro (4.8%). The acquisition of the subsidiaries (CZ Elettronica S.r.l. and Mecatronica S.r.l., both of which are now held by CZ Elettronica S.r.l.) in April 2025 contributed to the increase in revenues, for a total amount of 1,582 thousand Euro, without which revenue growth would be 4,775 thousand Euro (3.6%).

Exchange rate fluctuations had a negative impact on this item, in particular due to the fluctuations of the Brazilian Real, Chinese Renmimbi, Indian Rupee and US dollar. Excluding this effect (estimated at 2,550 thousand Euro in total), growth in revenues compared to the previous year would increase to 8,907 thousand Euro (6.7%).

Analysing the order intake of 2025, compared to the figure for 2024, there was an increase (overall 5% which, net of order intake related to the acquired subsidiaries, would be 4.5%), driven by an increase in order intake for the sensors business (+6.9%). For the automation components business, order intake increased compared to 2024, albeit to a lesser extent (+1.5%).

The backlog at the end of the fourth quarter showed an increase compared with the figure at 31 December 2024 (+5.3%, which would be +4.8% without the contribution of CZ Elettronica S.r.l.).

The table below shows a breakdown of revenues by geographical region, compared with the figure for the previous year.

	31 December 2025		31 December 2024			Change 2025-2024
(Euro /000)	Value	%	Value	%	Value	%
Italy	44,874	32.3%	41,274	31.1%	3,600	8.7%
European Union	34,554	24.9%	34,323	25.9%	231	0.7%
Europe non-EU	4,258	3.1%	3,888	2.9%	370	9.5%
North America	12,606	9.1%	13,093	9.9%	(487)	-3.7%
South America	6,025	4.3%	6,039	4.6%	(14)	-0.2%
Asia	36,154	26.0%	33,526	25.3%	2,628	7.8%
Rest of the world	493	0.4%	464	0.3%	29	6.3%
Total	138,964	100%	132,607	100%	6,357	4.8%

Annual Financial Report at 31 december 2025 Gefran Group

The breakdown of revenues by geographical region, compared with the figure for 2024, shows good performance across almost all areas in which the Group operates, with the most significant increase being recorded on the national market (+8.7%). As described for the quarter, the figure is positively affected by the revenues generated by the corporate acquisitions of April 2025. Without this effect, the increase in revenues in Italy would be more limited (+4.9%). Compared to 31 December 2024, there was also an increase in revenues in Europe (overall +1.6%), as well as in the Asia area (+7.8%, where exchange rate dynamics had a negative effect for the Chinese Renminbi and Indian Rupee, without which the increase would be +12.5%). With regard to the Americas, there was a contraction (overall -2.6%) due to the negative effect of currency fluctuations, net of which there would be an increase in revenues compared to the previous year (+2.6%).

Below is a breakdown of revenues for the year by business area, compared with the figure for the previous year.

Compared to the figure for the previous year, revenues from the sensors segment increased overall by 7.4% (+9.9% net of exchange rate fluctuations) in all the geographical regions reached by this business (in particular in Italy, Asia and Europe). With regard to the automation components segment, growth was more limited (2.4%), influenced, among others, by the revenues contributed by the newly acquired company CZ Elettronica S.r.l., whose operating activities fall within the segment in question. Without considering this contribution, the revenues generated by the automation components segment decreased in the period compared to the previous year (-0.5%). For further details on the economic performance of each segment, please see the paragraph Results by business area.

Increases for internal work as of 31 December 2025 amounted to 2,225 thousand Euro, up by 77 thousand Euro over the figure for 31 December 2024. This item mainly relates to the development costs of new products, in addition to internal costs for company IT systems, incurred during the period and capitalised.

Added value at 31 December 2025 amounted to 99,474 thousand Euro (95,430 thousand Euro at 31 December 2024), corresponding to 71.6% of revenues (0.4% lower than the figure as at 31 December 2024). The increase in added value, totalling 4,044 thousand Euro (2,780 thousand Euro without considering the added value contributed by CZ Elettronica S.r.l.), mainly relates to the higher revenues posted, though partially reduced by higher customs duties compared to the previous year (in particular linked to trade with the US subsidiary).

Other operating costs at 31 December 2025 amounted to 23,871 thousand Euro, in absolute terms an increase of 970 thousand Euro compared with the same period of 2024 (an increase of 495 thousand Euro net of the effect of the acquisitions described in the introduction), corresponding to 17.2% of revenues (17.3% in 2024). Overall, the change is the result of higher costs for professional and consulting services (especially administrative and management consultancy), as well as for external processing, entertainment expenses, personnel training and search costs.

	31 December 2025		31 December 2024		Change 2025-2024
(Euro /000)	Value	%	Value	%	Value	%
Sensors	90,929	65.4%	84,664	63.8%	6,265	7.4%
Automation components	56,254	40.5%	54,937	41.4%	1,317	2.4%
Eliminations	(8,219)	-5.9%	(6,994)	-5.3%	(1,225)	17.5%
Total	138,964	100%	132,607	100%	6,357	4.8%

Personnel costs in 2025 amounted to 53,160 thousand Euro, compared with 49,473 thousand Euro in 2024. As a percentage of revenues, the ratio was 38.3% (37.3% as at 31 December 2024). The increase, in absolute terms, of 3,687 thousand Euro, is partly the result of the personnel acquired as a result of the operations described in the introduction (a total of 23 employees at the acquisition date). Without considering this effect, personnel costs would be 2,748 thousand Euro higher than the previous period, reflecting the higher impact of the salary increase provided for by the National Collective Bargaining Agreement of June 2024 for all employees at the Group's Italian sites as well as the increase in workforce numbers to support the execution of the Group's strategy. Overall, the average number of employees in 2025 (calculated as the annual average) was 724 while in the same period of the previous year it was 675. For further details on the Group's workforce and its changes, please see the paragraph Human Resources.

EBITDA at 31 December 2025 was positive by 22,443 thousand Euro (23,056 thousand Euro at 31 December 2024) and corresponds to 16.2% of revenues (17.4% of revenues in 2024), showing a decrease compared to the same period of the previous year of 613 thousand Euro (463 thousand Euro when considering the same scope of consolidation). The higher added value generated by higher sales compared to the previous year was reduced by higher operating costs.

Depreciation, amortisation and impairment amounted to 8,110 thousand Euro, compared with 7,931 thousand Euro in the same period of the previous year.

EBIT at 31 December 2025 was positive and amounted to 14,333 thousand Euro (10.3% of revenues) as compared with an EBIT of 15,125 thousand Euro in 2024 (11.4% of revenues), a decrease of 792 thousand Euro (587 thousand Euro when considering the same scope of consolidation). The change is essentially the result of the same dynamics illustrated for EBITDA.

Charges from financial assets/liabilities in 2025 totalled 725 thousand Euro (as compared to 189 thousand Euro in income in 2024) and include:

• / financial income of 838 thousand Euro, including 818 Euro deriving from cash management (down by 461 thousand Euro compared with the figure for the 2024);
• / financial charges related to the Group's indebtedness amounting to 708 thousand Euro (down 256 thousand Euro compared with the 2024 figure);
• / negative differences on currency transactions, amounting to 762 thousand Euro, compared with the result for 2024, which was negative by 102 thousand Euro; the change was especially the result of the exchange rate of the Euro compared with the Indian rupee and the Chinese Renminbi;
• / financial charges on financial debts as a result of application of the new accounting standard IFRS16 totalling 97 thousand Euro (53 thousand Euro in 2024).

It should be noted that the transactions described in the introduction affected this item in an insignificant manner.

Income from shareholdings valued at equity, amounting to 12 thousand Euro (39 thousand Euro at 31 December 2024), reflect the results reported by the subsidiary Axel S.r.l.

In 2025 taxes were negative overall and amounted to 3,751 thousand Euro (negative overall by 4,211 thousand Euro in 2024). They consist of:

• / negative current taxes of 3,463 thousand Euro (negative for the amount of 3,551 thousand Euro in 2024);
• / net negative change in deferred tax assets and liabilities of 288 thousand Euro (net negative change of 660 thousand Euro in the previous year).

The net profit at 31 December 2025 amounted to 9,869 thousand Euro (7.1% of revenues), as compared with the positive result of 11,142 thousand Euro in the previous year (8,4% of revenues), a decrease of 1,273 thousand Euro (1,147 thousand Euro when considering the same scope of consolidation).

Gefran Group

52

Annual Financial Report at 31 december 2025

Reclassified consolidated statement of financial position at 31 December 2025

The Gefran Group's reclassified consolidated statement of financial position as of 31 December 2025 may be broken down as follows:

(Euro /000)	31 December 2025		31 December 2024
	Value	%	Value	%
Intangible assets	14,060	20.7	13,330	20.5
Tangible assets	41,961	61.7	41,368	63.5
Other non-current assets	8,851	13.0	5,058	7.8
Net non-current assets	64,872	95.4	59,756	91.7
Inventories	15,182	22.3	15,747	24.2
Trade receivables	26,016	38.3	23,264	35.7
Trade payables	(21,571)	(31.7)	(18,795)	(28.8)
Other assets/liabilities	(12,163)	(17.9)	(10,460)	(16.0)
Working capital	7,464	11.0	9,756	15.0
Provisions for risks and future liabilities	(1,156)	(1.7)	(1,265)	(1.9)
Deferred tax provisions	(985)	(1.4)	(933)	(1.4)
Employee benefits	(2,208)	(3.2)	(2,131)	(3.3)
Net invested capital	67,987	100.0	65,183	100.0
Group Shareholders' equity	100,829	148.3	99,338	152.4
Shareholders' equity of minority interests	-	-	-	-
Shareholders' equity	100,829	148.3	99,338	152.4
Non-current financial payables	11,697	17.2	16,269	25.0
Current financial payables	4,921	7.2	5,173	7.9
Financial payables for IFRS 16 leases (currentand non-current)	3,609	5.3	3,859	5.9
Financial liabilities for derivatives (current and
non-current)	178	0.3	311	0.5
Financial assets for derivatives (current andnon-current)	(5)	(0.0)	(34)	(0.1)
Other non-current financial investments	(102)	(0.2)	(104)	(0.2)
Cash and cash equivalents and current
financial receivables	(53,140)	(78.2)	(59,629)	(91.5)
Net debt relating to operations	(32,842)	(48.3)	(34,155)	(52.4)
Total sources of financing	67,987	100.0	65,183	100.0

Net non-current assets at 31 December 2025 totalled 64,872 thousand Euro, as compared with 59,756 thou-

sand Euro on 31 December 2024. The main changes are indicated below:

/ intangible assets, equal to 14,060 thousand Euro, increased overall by 730 thousand Euro. This change includes the capitalisation of development costs (1,848 thousand Euro), new investments or other capitalisations of internal costs (939 thousand Euro), as well as decreases due to amortisation in the period (1,856 thousand Euro). The change in exchange rates had a negative impact on the item amounting to 344 thousand Euro overall. On top of this there is the accounting of goodwill of 155 thousand Euro, calculated as the difference between the cost for the acquisition of CZ Elettronica S.r.l. together with its subsidiary and Mecatronica S.r.l. (the latter having now been incorporated by its parent) and the value of the

/ tangible assets, equal to 41,961 thousand Euro, decreased compared to 31 December 2024 by 593 thousand Euro. Investments during 2025 (6,598 thousand Euro) were partly neutralised by the depreciation charge for the period (4,865 thousand Euro). This item also includes the value of the right-of-use assets recognised in accordance with IFRS 16. The total decreased, compared to the closing figure of the previous year (275 thousand Euro), following the renewal or signing of new contracts (1,324 thousand Euro increase), offset by depreciation (1,389 thousand Euro decrease) and the advance termination of contracts (137 thousand Euro decrease). Lastly, the net effect of exchange-rate changes was negative at 955 thousand

• net assets acquired;
• Euro overall;
• S.p.A., as described in the introduction.

/ other non-current assets as at 31 December 2025 amounted to 8,851 thousand Euro (5,058 thousand Euro as at 31 December 2024), with an increase of 3,793 thousand Euro, mainly due to the acquisition of 22% of 40Factory S.r.l., recognised among shareholdings valued at equity of the Parent Company Gefran

Working capital as at 31 December 2025 was 7,464 thousand Euro, compared with 9,756 thousand Euro as at 31 December 2024, showing a total decrease of 2,292 thousand Euro (a 3,038 thousand Euro decrease without considering the entries of the newly acquired CZ Elettronica S.r.l.). The main changes are illustrated below:

• / inventories went from 15,747 thousand Euro at 31 December 2024 to 15,182 thousand Euro at 31 December 2025, with a net decrease of 565 thousand Euro (with the same scope of consolidation, there would be a decrease of 1.008 thousand Euro). There was an increase in the net value of semi-finished products and finished products stocks to meet requests for delivery to customers scheduled for the following quarter (overall 324 thousand Euro), while raw materials stocks decreased by 889 thousand Euro; the change includes the exchange rate effect, which was negative overall by 416 thousand Euro;
• / trade receivables amounted to 26,016 thousand Euro, an increase of 2,752 thousand Euro compared to 31 December 2024 (a 1,814 thousand Euro increase when considering the same scope of consolidation), reflecting the growth in revenues; the Group analyses receivables in a timely manner, considering various factors (geographical region, business area, solvency of individual customers). These checks have not identified any positions that might jeopardise their collectability;
• / trade payables amounted to 21,571 thousand Euro, an increase of 2,776 thousand Euro compared to 31 December 2024 (2,455 thousand Euro without considering the effect brought by the acquisitions described in the introduction);
• / other net assets and liabilities at 31 December 2025 were negative by a total of 12,163 thousand Euro (negative by 10,460 thousand Euro as of 31 December 2024). They include, inter alia, payables to employees, directors and social security institutions, receivables and payables for direct and indirect taxes; the change compared with the closing date of the previous year mainly relates to payables to employees and directors, as well as to social security institutions.

The provisions for risks and future liabilities totalled 1,156 thousand Euro and went down by 109 thousand Euro compared to the figure at 31 December 2024, when they amounted to 1,265 thousand Euro. This item includes provisions for sundry risks and the product warranty provision.

Employee benefits amounted to 2,208 thousand Euro, compared with 2,131 thousand Euro on 31December 2024.

Annual Financial Report at 31 december 2025 Gefran Group

This item includes the post-employment benefit reserve (2,150 thousand Euro), in addition to residual payables to employees who have signed agreements that protect the Company from competing activities (so-called Non-competition agreements), for 58 thousand Euro.

Shareholders' equity at 31 December 2025 amounted to 100,829 thousand Euro, up by 1,491 thousand Euro over the end of the year 2024. The change is mainly related to the positive result for the period, equal to 9,869 thousand Euro, reduced by the change in the translation reserve, negative by 2,318 thousand Euro, and by the payment of dividends on the 2024 profit, totalling 6,107 thousand Euro. Finally, at 31 December 2025 the minority portion of shareholders' equity of the subsidiary CZ Elettronica S.r.l., amounting to 479 thousand Euro, was fully attributable to the Gefran Group by virtue of the purchase option entered into in the agreement with the sellers and linked to the remaining 40% of the Company's shares. This option was exercised on 23 February 2026, as described in paragraph Significant events after the end of 2025.

The following schedule reconciles the shareholders' equity and result for the period of the Parent Company with the related amounts reported in the consolidated financial statements.

The total comprises short-term cash and cash equivalents of 46,989 thousand Euro and medium/long-term debt of 14,147 thousand Euro.

This item also includes the effect of applying IFRS 16, leading to the recording of financial payables in the amount of 3,609 thousand Euro as at 31 December 2025, of which 1,230 thousand Euro reclassified as current and 2,379 thousand Euro as non-current (overall 3,859 thousand Euro as at 31 December 2024, of which 1,195 thousand Euro reclassified as current and 2,664 thousand Euro as medium/long-term).

In the fiscal year 2025, Gefran S.p.A. applied to the Simest call for the digital transition, for a total value of 1,290 thousand Euro, which provides for the granting of a 10% non-repayable grant and a 90% subsidised loan. As of 31 December 2025, a total of 322 thousand Euro had been received, including the disbursement of the quotas**1** from the available resources of the revolving fund and co-financing, to be used for investments (aimed at digital innovation and/or ecological transition), as well as for the strengthening of the Company's capital, benefiting competitiveness in international markets. This resulted in the recognition of grants totalling 25 thousand Euro and non-current financial payables totalling 297 thousand Euro. The loan will be repaid in 8 half-yearly instalments, each of the same amount, starting from the end of the pre-amortisation period (lasting 2 years from 30 April 2026). The aid, pursuant to the EU de minimis Regulation, is therefore 231 thousand Euro, once 100% of the financing and co-financing has been reached.

No new funding was subscribed during 2025 in addition to the above.

The change in net financial position, down by 1,313 thousand Euro compared to 31 December 2024, mainly reflects the positive cashflow generated by ordinary operations (23,267 thousand Euro), as partly absorbed by the disbursements for technical investments made during the year (9,388 million Euro) and for the operations described in the introduction to the section and in Significant events in 2025 relating to the acquisition of a stake in 40Factory S.r.l., equal to 22% of its share capital (4,000 thousand Euro), and a majority stake equal to 60% in CZ Elettronica S.r.l., recognised among the subsidiaries of Gefran S.p.A. (739 thousand Euro, net of acquired cash). The payment of dividends on the 2024 results in the second quarter of 2025 (6,107 thousand Euro), as well as taxes and rental fees (totalling 3,793 thousand Euro), contributed to the decrease in financial resources. In addition, the change in the Group's available financial position as at 31 December 2025 includes the negative effect of the exchange rate difference for foreign currencies compared with the previous year (estimated overall at 1,044 thousand Euro).

		31 December 2025	31 December 2024
(Euro /000)	Shareholders'equity	Result for theperiod	Shareholders'equity	Result for theperiod
Parent Company
shareholders' equity andoperating result	88,283	10,107	84,182	10,222
Shareholders' equity andoperating result of theconsolidated companies	41,143	4,965	42,560	6,531
Elimination of the carrying value ofconsolidated investments	(31,405)	181	(30,287)	-
Goodwill	3,881		3,778	-
Elimination of the effects oftransactions conducted betweenconsolidated companies	(1,073)	(5,384)	(895)	(5,611)
Group share of shareholders'equity and operating result	100,829	9,869	99,338	11,142
Minorities' share of shareholders'equity and operating result	-	-	-	-
Shareholders' equity andoperating result	100,829	9,869	99,338	11,142

The net financial position at 31 December 2025 was positive and amounted to 32,842 thousand Euro, compared with the figure recorded at the end of the previous year, which was positive by 34,155 thousand Euro.

1 Provided for by the Decree of 1 June 2023 of the Minister of Foreign Affairs and International Cooperation, in agreement with the Ministers of Enterprise and Made in Italy, of Economy and Finance, containing "Regulation of financial instruments in support of the internationalization of companies, from the Revolving Fund 394/81" ("Decree").

This item is analysed below:

31 December	31 December	Change
53,140	59,629	(6,489)
		252
		(35)
46,989	53,261	(6,272)
		4,572
		285
		133
		(29)
		(2)
(14,147)	(19,106)	4,959
32,842	34,155	(1,313)
	2025(4,921)(1,230)(11,697)(2,379)(178)5102	2024(5,173)(1,195)(16,269)(2,664)(311)34104

Consolidated cash flow statement

in 2025, netted of the effect of provisions, depreciation/ amortisation and financial items, generated cash of 24,399 thousand Euro (25,064 thousand Euro in 2024). The net change in other assets and liabilities absorbed resources of 452 thousand Euro (in 2024 it had generated resources of 1,741 thousand Euro) and the management of working capital absorbed cash on hand in the amount of 192 thousand Euro (in the previous fiscal year it had generated resources of 321 thousand Euro). The changes in provisions (risks and future liabilities, deferred taxes) absorbed 488 thousand Euro in cash on hand (471 thousand Euro in 2024).

With regard to investing activities, in 2025 disbursements of 9,388 thousand Euro were recorded for the technical investments made (6,363 thousand Euro in 2024). It should also be noted that, as described in

(Euro /000)	31 December2025	31 December2024
A) Cash and cash equivalents at the start of the period	59,629	57,159
B) Cash flow generated by (used in) operations in the period	23,267	26,657
C) Cash flow generated by (used in) investment activities	(14,116)	(6,328)
D) Free Cash Flow (B+C)	9,151	20,329
E) Cash flow generated by (used in) financing activities	(14,596)	(17,902)
F) Cash flow from continuing operations (D+E)	(5,445)	2,427
G) Exchange rate translation differences on cash at hand	(1,044)	43
H) Net change in cash at hand (F+G)	(6,489)	2,470
I) Cash and cash equivalents at the end of the period (A+H)	53,140	59,629

equivalents outflow of 4,000 thousand Euro, in addition to the financial outflow related to the acquisition of a 60% stake in CZ Elettronica S.r.l. (739 thousand Euro, net of acquired cash).

Free cash flow (operating cash flow net of investing activities) at 31 December 2025 amounted to positive 9,151 thousand Euro (positive 20,329 thousand Euro at 31 December 2024).

Financing activities absorbed resources totalling 14,596 thousand Euro (a total of 17,902 thousand Euro in 2024), of which 5,117 thousand Euro related to the repayment of non-current financial payables (9,548 thousand Euro as of 31 December 2024) and 6,107 thousand Euro for dividend payment (5,965 thousand Euro in 2024).

It should be noted that the "Net financial position" table includes "Other non-current financial investments" (totalling 102 thousand Euro) which comprise, among other things, the item "Financial pre-paid expenses" in the amount of 2 thousand Euro (4 thousand Euro at 31 December 2024). Net of this item and for the purposes of Regulation (EU) 2017/1129, the net financial position as at 31 December 2025 was positive at 32,840 thousand Euro, while at 31 December 2024 it was positive at 34,151 thousand Euro.

Annual Financial Report at 31 december 2025 Gefran Group

2INVESTMENTS

Technical investments made by the Group during 2025 totalled 9,388 thousand Euro (6,363 thousand Euro as at 31 December 2024) and mainly relate to:

• / production and laboratory machinery and tools for the Group's Italian plants, totalling 2,995 thousand Euro, of which 2,116 thousand Euro for the production departments of the sensors business in the Parent company (at 31 December 2024, a total of 1,518 thousand Euro had been invested, of which 860 thousand Euro for the production departments of the automation components business);
• / production and laboratory machinery and tools for the plants of the Group's foreign subsidiaries for a total of 301 thousand Euro, of which 171 thousand Euro in China to reinforce the production lines of the sensors business (as at 31 December 2024, a total of 451 thousand Euro had been invested abroad, of which 243 thousand Euro in the United States and 137 Euro in China);
• / upgrading of industrial buildings and facilities for a total of 2,824 thousand Euro in the Parent Company Gefran S.p.A. (of which 1,870 thousand Euro for the upgrading of the area hosting the operational activities of the automation components division and the headquarters) and 112 thousand Euro in the foreign subsidiaries (as at 31 December 2024, 737 thousand Euro had been invested in the upgrading of buildings in the Parent Company and 615 thousand Euro in the foreign subsidiaries, of which 457 thousand Euro in the US subsidiary);
• / renewal of electronic office machines and Information Technology systems equipment used within the Group, totalling 365 thousand (463 thousand Euro as at 31 December 2024);
• / capitalisation of costs incurred in the period for new product development, totalling 1,848 thousand Euro (2,024 thousand Euro in 2024);
• / investments in intangible assets amounting to 942 thousand Euro, mainly relating to management software licences and SAP ERP development (other intangible assets totalling 554 thousand Euro were recognised in 2024).

The investments carried out by the Group are summarised below by type and

geographical region:

Total
Tangible assets
Intangible assets

(Euro /000)	31 December 2025	31 December 2024
Intangible assets	2,790	2,578
Tangible assets	6,598	3,785
Total	9,388	6,363

(Euro /000)

Italy
European Union
Europe non-EU
North America
South America
Asia
Total

		31 December 2025	31 December 2024
(Euro /000)	intangibleassets andgoodwill	tangible assets	intangibleassets andgoodwill	tangible assets
Italy	2,522	5,595	2,560	2,630
European Union	10	75	-	106
Europe non-EU	256	81	-	36
North America	-	60	-	703
South America	2	107	18	59
Asia	-	680	-	251
Total	2,790	6,598	2,578	3,785

Workforce

The Group at 31 December 2025 had a total workforce of 748, an increase of 49 units compared to the end of 2024.

This figure for the year includes the addition to the Group of the newly acquired company CZ Elettronica S.r.l., with a staff of 23 employees, including 9 manual workers and 14 clerical staff (at the acquisition date). In addition to this event, changes during 2025 are detailed as follows:

• / 83 people joined the Group, including 17 manual workers, 63 clerical staff or middle managers and 3 managers (in the Parent Company);
• / 57 people left the Group, including 18 manual workers, 37 clerical staff or middle managers and 2 managers (in the Parent Company).

The change includes the stabilisation of 10 temporary workers (in Italy), which took place in early 2025.

As a result of the change, the Group's turnover rate, calculated on the annual average number of employees of 724, is 22.5% which, net of the effect of the aforesaid acquisition, would be 19.3%.

18

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

62 63

FLY Gefran Talent Academy, FLY Youth and kenFLY

Talent is the unique set of an individual's characteristics, skills and knowledge.

Gefran promotes talent by focusing on readiness to innovate and renew, a concept that is given concrete meaning in the pragmatic work Gefran's people do together every day. The Group has always invested in its People's development, knowing that its competitiveness depends on each individual's contribution to achieving common goals.

FLY is Gefran's Talent Academy, created to develop and support the Group's distinctive skills over time and to promote people's talent by focusing on their strengths, with a systemic development perspective aligned with the Gefran Way and consistent with the Group's business strategy. Gefran uses a variety of tools and methods targeting both its existing staff and new employees. FLY includes specific programmes for development of potential, including:

/ masters in innovation; / managerial coaching; / mentoring and reciprocal mentoring;

• / on the job training;
• / participation in focus groups and workshops; / classroom education.

FLY Youth is a session for recent graduates who are being integrated in the company, also due to the current generational turnover. It includes a programme called "4x4", consisting of 4 laboratories on the development of 4 fundamental soft skills (focusing on results, ability to cooperate, communication, self-management), held with the guidance of external teachers and coaches. The programme also includes sessions held by the managers of the main company departments, in order to train participants on the "Corporate System" and on Gefran's organisation. At the end of the process, participants in FLY Youth compete in a "contest", designing projects in specific areas of strategic importance for the Group (e.g. innovation, sustainability, AI), which give rise to concrete projects (such as "INNOWAY", the open innovation programme sponsored by the Lombardy Region).

In addition to being Gefran's Academy for skills development, FLY has become a hub for sharing ideas, experiences, best practices and cooperation.

The Academy's initiatives are completed by kenFLY, the digital hub of FLY, inspired by the need to make talent development pathways equally available to everyone within the organisation, on the basis of an open and responsible approach. Through kenFLY, Gefran commits to reinforcing and completing its training methodology based on individual strengths, bearing in mind that inclusiveness and diversity, considered in terms of appreciation of individuals' characteristics, are key themes.

Employees in all countries throughout the entire Group have access to this platform for practising their skills and know-how, and for exchanging experience and knowledge. Through kenFLY, employees can make use of training content focusing on the six skill areas that make up the matrix of Gefran's expertise. Each employee can make use of the content he or she deems most interesting, and at the same time the company can create targeted and tailor-made paths. It is possible to view and be aware of which strengths are being trained the most, and which areas could be successfully improved, using a common language shared by the entire Group that empowers people in their own training and provides clear, structured feedback.

The dynamics of communication, learning and engagement of kenFLY have been designed taking into account both cultural characteristics and the particular features of each generation. One of these is the gamification of the learning process through the digital game Beyond Quest and the offer of content organized in seasons: these modalities represent a unique innovation applied to vocational training. The platform, which today also supports the onboarding process dedicated to the integration of new employees into the organisation, has received awards and recognitions (finalist for the innovation award of the Observatory of the Politecnico di Milano; She SPS Italy Award 2022, winner of the Ideas Contest La Fabbrica del Futuro di Confindustria for Bergamo Brescia Capital of Culture 2023).

Involvement and participation

The company is all about people, and professional development is an essential factor in responding to the risk of losing talent, know-how, and skills, and therefore opportunities and competitiveness.

Aware of this, Gefran implements a series of initiatives that are described in the paragraph ESRS S1 Workforce reported in the section Social information of the Sustainability Report included in this Report on Operations.

Through FLY Performance, the skills assessment and continuous feedback tool, a transparent and structured skills management system is in place for periodic analysis and comparison of skills development, as well as for the sharing of structured feedback. It is based on the shared matrix of competences. The goal the Group pursues through this integrated system is twofold: strengthening people's cross-sectoral skills and techniques while, at the same time, activating and empowering the Management team, strengthening their aptitude for mentoring and providing continuous feedback thanks to growing employability.

Gefran also continuously offers opportunities to students, recent secondary-school graduates and recent university graduates through its various collaborations with universities and colleges. Gefran offers curricular and extra-curricular apprenticeships and school/work agreements and opportunities for students to begin work in the areas they have studied, leading to possible employment compatibly with the Group's capacity and the talent demonstrated.

Gefran has sponsored several projects, including an experiential laboratory for middle school students, focused on STEM disciplines, organised and promoted in the fourth quarter of 2025. The objective of the project, included in the Strategic Sustainability Plan that the Group is implementing, was to achieve a synergistic action with local educational institutions, offering innovative educational courses for the development of cross-cutting skills (such as problem solving, teamwork and operational autonomy) and aimed at bringing young people closer to STEM subjects through an immersive and practical teaching experience. Overall project numbers: 11 institutions, 23 classes and 559 male and female students.

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Annual Financial Report at 31 december 2025 Gefran Group

4RESULTS BY

BUSINESS AREA

The following paragraphs comment on the performance of the individual business areas. To ensure correct interpretation of figures relating to the individual activities, it should be noted that:

• / the business represents the sum of revenues and related costs of the Parent Company Gefran S.p.A. and of the Group subsidiaries;
• / the figures for each business are provided gross of internal trade between different businesses;
• / inter-sector sales (trade) are booked at transfer prices that are broadly in line with market prices;
• / the central operations costs, which principally pertain to Gefran S.p.A., are fully allocated to the businesses, where possible, and quantified according to actual use; they are otherwise divided according to economic-technical criteria.

It should be added that the results of the subsidiary CZ Elettronica S.r.l., acquired during the second quarter of 2025 together with its subsidiary Mecatronica S.r.l., incorporated into its parent in the third quarter of 2025 as described in Significant events in 2025, are included in the automation components business.

Please refer to Note 12 of the Specific explanatory notes to the consolidated financial statements for an examination of the consolidated statement of financial position by business area.

SENSORS BUSINESS

Significant events and strategy

In 2025, the Gefran's sensors business confirmed its strategic value within the Group, recording growth above the company average and showing significant strength across all major geographies. The performance trend gives evidence of an accelerating sector, capable of recovering the weaknesses observed in 2024 and of benefiting from the commercial and industrial actions launched in previous years.

Revenues in the sensors segment increased compared with the previous year; this is even more significant when excluding the negative impact of exchange-rate fluctuations. Growth involved almost all the geographical regions served by the Group, with particularly positive performance in Italy and the Asian markets, where the expansion of demand and the strengthening of the commercial network produced better-than-expected results.

The macroeconomic context, still characterised by currency volatility, penalised the operating margin; nevertheless, the sensors business contributed significantly to the Group's overall margins. The added value of the sector rose in absolute terms, supported by the increase in sales volumes, although it was affected by the adverse impact of currencies and higher customs duties related in particular to trade with the United States.

2025 also represented a year of consolidation of the industrial structure of the sensors business. Investments in production lines and research and development activities further strengthened the competitive strength of the segment. Particular attention was paid to strengthening automation in the production of industrial pressure sensors and position transducers, two product families for which further significant growth is expected in the medium term.

The products that contributed most to sales growth were industrial pressure sensors, melt sensors and position transducers.

From a technical point of view, activities in 2025 continued in line with the Group's technological priorities: the development of sensors with digital communication for Industry 4.0, the expansion of the range for mobile hydraulics, the introduction of multi-variable solutions and the advancement of safety certifications. These initiatives strengthen Gefran's position in the application segments with the highest technological content, in which the company is recognised as a reliable partner at a global level.

Strategic investments continued in order to strengthen the organisation, improve production facilities and locate certain production lines (in particular force sensors for the plastic injection machinery sector) in the Chinese subsidiary. Planning for 2025 focused on operational efficiency and the full ramp-up of investments made in the previous two years, focusing especially on strengthening automation for the product families with the highest expected growth, including industrial pressure sensors and positioning devices.

Annual Financial Report at 31 december 2025 Gefran Group

The sustainability principle continued to guide business development, with projects dedicated to reducing environmental impact. Among these, the packaging overhaul programme, launched in 2024 and implemented in 2025, provides, for example, for the transition to a new packaging solution for position sensors. The project will generate tangible benefits such as less plastic used (about 20.5 tonnes), a reduction in packaging volume by more than two thirds, a shorter cycle time, reductions in WIP and greater overall energy efficiency.

At the same time, the journey towards the complete elimination of paper in production order management continued, with the aim of achieving a fully digital system by 2028.

With reference to circularity, during 2025 Gefran began an assessment of the environmental impact of its products, through the complete Life Cycle Assessment study (LCA in short, using the cradle-to-grave approach). The project is aimed at assessing the environmental performance of a few representative products from the Gefran portfolio, in accordance with the standards of the ISO 14040 series, and is the starting point for defining the model for assessing environmental impacts to be applied when designing new Gefran products. In 2025, the LCA study for the KM pressure sensor was performed and concluded.

In conclusion, the Gefran sensors business continued its sustained growth path in 2025, supported by targeted investments, an expanding product portfolio, an improvement in global demand and a strategy focused on technological excellence, operational efficiency and sustainability. The segment is increasingly recognised as one of the main drivers of the Group's development and a determining factor for value generation in the medium-long term.

Commercial development in 2026 will see a continued focus on strategic vertical markets such as Semiconductors, Metals & Glass, Packaging and Plastics. Over the next three years, local production lines for sensors and industrial pressure products will be launched at the Gefran Automation Technology plant in China, aimed at achieving increased attractiveness and competitiveness in the Asian market, also thanks to the localisation of the supply chain.

Summary results

The table below shows the key economic figures:

(Euro /000)	31December	31December		Change 2025- 2024		4Q 2025 4Q 2024		Change 2025- 2024
	2025	2024	Value	%			Value	%
Revenues	90,929	84,664	6,265	7.4%	21,691	19,986	1,705	8.5%
EBITDA	18,697	18,400	297	1.6%	2,940	2,979	(39)	-1.3%
% of revenues	20.6%	21.7%			13.6%	14.9%
EBIT	14,059	13,766	293	2.1%	1,759	1,837	(78)	-4.2%
% of revenues	15.5%	16.3%			8.1%	9.2%

The revenues of the sensors business are analysed by geographical region below:

		31 December 2025		31 December 2024	Change 2025 - 2024
(Euro /000)	Value	%	Value	%	Value	%
Italy	19,417	21.4%	16,418	19.4%	2,999	18.3%
Europe	26,613	29.3%	25,584	30.2%	1,029	4.0%
America	13,564	14.9%	13,329	15.7%	235	1.8%
Asia	31,053	34.2%	29,052	34.3%	2,001	6.9%
Rest of the world	282	0.3%	281	0.3%	1	0.4%
Total	90,929	100%	84,664	100%	6,265	7.4%

ASIA 34%

ASIA

34%

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

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Annual Financial Report at 31 december 2025 Gefran Group

Business performance Investments

Revenues from the business as at 31 December 2025 amounted to 90,929 thousand Euro, an increase compared to the figure as at 31 December 2024, which amounted to 84,664 thousand Euro, recording a percentage increase of 7.4%. Exchange rate fluctuations had a negative impact on this item (in particular due to the fluctuations of the Brazilian Real, Chinese Renmimbi, Indian Rupee and US dollar). Excluding this effect (estimated at 2,047 thousand Euro in total for the business in question), growth in revenues compared to the same period of the previous year would be 9.8%.

In particular, revenue growth was driven by sales of melt and industrial pressure product families.

From a geographical point of view, the increase in revenues in the year (compared with the previous year) was recorded in all areas served by the Group, with positive double-digit percentage changes for the national market (+18.3%). Revenues also increased in Europe (+4%), in the Americas (+1.8%, which, net of the negative effect of currencies, would be +7%), as in Asia (+6.9%, which, without the effect of exchange rate fluctuations, would be +11.6%).

Positive signs were also recorded in orders received for the sensors business in 2025, totalling 91,151 thousand Euro, an increase over the figure for the same period of 2024 (+6.9%). The backlog at 31 December 2025 increased (by 9.1%) compared to 31 December 2024.

In the fourth quarter of 2025, revenues amounted to 21,691 thousand Euro, 8.5% higher than in the same period in 2024, when they came to 19,986 thousand Euro. The figure for the quarter is also influenced by currency dynamics, without which the increase in revenues compared to the same previous quarter would be 11%.

EBITDA for the period ended 31 December 2025 amounted to 18,697 thousand Euro (20.6% of the business unit's revenues), largely positive and up by 297 thousand Euro compared with 31 December 2024, when it was 18,400 thousand Euro (21.7% of revenues). The change in EBITDA compared to the same period of the previous year is essentially attributable to higher sales volumes, partly reduced by the increase in customs duties, in particular for trade with subsidiaries, and by the higher costs incurred both for the operational management of the business and for the strengthening of the workforce to support the commercial strategy.

EBIT as at 31 December 2025 amounted to 14,059 thousand Euro, equal to 15.5% of revenues, compared with an EBIT of 13,766 thousand Euro in the previous year (16.3% of revenues), an increase of 293 thousand Euro. The change in the figure for 2025 compared to the previous year was mainly due to the same dynamics illustrated for EBITDA.

Comparing the figures by quarter, EBIT in the fourth quarter of 2025 amounted to 1,759 thousand Euro (8.1% of revenues), compared with 1,837 thousand Euro (9.2% of revenues) in the same quarter of 2024. EBIT in the quarter reflects the higher operating costs required to execute the business strategy.

Investments in sensors in 2025 amounted to 4,900 thousand Euro, and included investments in "Intangible assets" equal to 1,398 thousand Euro, of which 804 thousand Euro related to the capitalization of research and development costs for new products (for the remaining part they refer to the purchase of software programmes and licenses and to the development of the company's management software).

Increases in "Tangible assets" totalled 3,502 thousand Euro. They included enhancing the production lines of the business through the installation of new production and laboratory equipment, partly made within the Group, both in foreign production sites (specifically, 171 thousand Euro were invested in the Chinese facility) and in the Parent Company Gefran S.p.A. (investments totalling 1,934 thousand Euro, with the aim of increasing the efficiency of existing production lines and 174 thousand Euro in the implementation of new lines for new products). In addition the Parent Company invested 802 Euro invested in improving buildings and facilities dedicated to the business.

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Annual Financial Report at 31 december 2025 Gefran Group

Significant events and strategy

2025 proved to be a difficult year for the automation components business, mainly due to the highly uncertain macroeconomic situation that severely slowed investment policies, with a further penalisation, at the consolidated level, caused by the general weakening of foreign currencies against the Euro. Despite a positive first quarter, the core months of the year recorded performance below that of the previous year, with a recovery that began to become partially evident in the fourth quarter.

China and emerging markets grew thanks to business development strategies and to product improvements designed to meet customer needs. On the other hand, Europe and the US slowed down due to the uncertainty blocking investments and plant renovations.

The slowdown in customer investments particularly affected sales of the business's higher added-value product families of power controllers and regulators, with a shift towards simpler products such as static units. This change in the product mix led to reduced business margins, despite the continued pursuit of actions aimed at reducing costs for some categories of raw materials and improved production efficiency, both due to the commissioning of investments made in previous years and the continuous improvement actions implemented in the Operations areas. Among others, we should mention the strengthening of digitalisation and the focus that led to the reduction of the value of raw material stocks, without any negative effect on punctuality and delivery times.

In terms of volumes, the (regulators) business line decreased compared to the previous year. The applications that use these products are partly switching to PLC-based solutions, thus prompting Gefran to redesign its programmable automation platform. Against this trend were higher-end regulators (Performance series) and display-free MultiPIDs, confirming the continued growth in demand for advanced control systems.

The line of power controllers, on the other hand, slowed down due to the reduction in investments in facility electrification, despite the fact that the market development launched by the Group is continuing in the most forward-looking geographical areas, which is even more targeted at generating new opportunities, thanks to the focus of specific resources on Plastic and Metal vertical markets. Contrary to the trend, static units showed an increase of more than 10% compared with the previous year.

The intensity in the development of new products and the introduction of innovative functionalities continued in 2025 also with the strengthening of the R&D structure, both in Italy and with the creation of the first R&D unit at the Chinese headquarters that will focus on the development and adaptation of static units for the Asian market.

In the second quarter, G-Mation was launched, the new automation platform that introduces PLC P6 and GF Project 6.x software, integrating webserver and docker technologies and responding to future cybersecurity requirements. The offering was further expanded with new I/O units released during the year, and the G-Mation ecosystem began integrating with the Industrial IoT and Generative AI solutions of 40Factory S.r.l., a technology company in which Gefran acquired a shareholding in the first quarter of 2025. In the power control segment, the new series of advanced GRC controllers, ranging from 25A to 150A, was introduced, featuring greater compactness, evolved metrological performance, higher-performance communication buses and new feedback algorithms. The expansion of the series will continue in 2026 with new sizes and features, including smart load management and Digital Twin diagnostics. Finally, in the area of process control, updates to advanced PID algorithms and the introduction of the Profinet protocol into the Performance series continued. The development of MultiPID, a new modular and expandable platform with up to 64 channels, was launched at the end of 2025 and is expected to be the main project in the area in 2026.

Commercial development actions in 2026 will see our continued focus on the strategic markets of Semiconductors, Metals & Glass, Packaging and Plastics, supported by the global sharing of successful cases and the continuous exchange of knowledge between sales networks. In the second quarter of the year, the local production line for static units is scheduled to start at the Gefran Automation Technology plant in China, in order to speed up the response given to Asian customers and leverage the local supply chain.

The sustainability strategy applied to the business results in a structured journey that integrates environmental objectives, responsible innovation and resource efficiency. Initiatives are developed along three main lines, all geared towards the creation of value for customers and the reduction of impacts along the product life cycle:

• / Accelerate the energy efficiency of the customers' industrial processes. Technological innovation is aimed at contributing to the decarbonisation of production chains. Optimizing PID control algorithms enables more precise process management, reducing stabilization times, energy waste and inefficiencies. The new generation of Power Controllers introduces advanced Smart Load Management features, which can monitor consumption in real time and intelligently modulate energy supply. These solutions are intended to reduce peaks, waste and losses, creating an immediate and measurable environmental benefit for end users
• / Favour circular models and the reduced impact of materials. Product design is evolving towards more responsible use of resources. In the segment of power controllers, technical assessments are under way on the use of recycled aluminium components, with the aim of reducing our dependence on virgin materials and lowering our CO₂ footprint associated with production
• / Minimize consumption of natural resources in internal processes. Sustainable resource management

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Summary results

is being pursued with the programme designed for a gradual reduction in paper use. Product documentation is migrating to digital formats, reducing the need for printed materials. In the field of production, the digitization of assembly instructions and production orders will lead to the complete elimination of paper by 2028, strengthening the transition to a paperless model.

The table below shows the key economic figures:

(Euro /000)	31December	31December		Change 2025	- 2024 4Q 2025	4Q 2024		Change 2025- 2024
	2025	2024	Value	%			Value	%
Revenues	56,254	54,937	1,317	2.4%	14,154	13,499	655	4.9%
EBITDA	3,746	4,656		(910) -19.5%	646	669	(23)	-3.4%
% of revenues	6.7%	8.5%			4.6%	5.0%
EBIT	274	1,359		(1,085) -79.8%	(241)	(167)		(74) -44.3%
% of revenues	0.5%	2.5%			-1.7%	-1.2%

The revenues of the automation components business are analysed by geographical region below:

	31 December 2025		31 December 2024		Change 2025 - 2024
(Euro /000)	Value	%	Value	%	Value	%
Italy	32,958	58.6%	31,250	56.9%	1,708	5.5%
Europe	12,327	21.9%	12,721	23.2%	(394)	-3.1%
America	5,137	9.1%	5,874	10.7%	(737)	-12.5%
Asia	5,621	10.0%	4,909	8.9%	712	14.5%
Rest of the world	211	0.4%	183	0.3%	28	15.3%
Total	56,254	100%	54,937	100%	1,317	2.4%

EUROPE 22%

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Business performance

At 31 December 2025, business revenues amounted to 56,254 thousand Euro, up 2.4% compared to 31 December 2024, when they amounted to 54,937 thousand Euro (a 3.3% increase net of the negative effect of exchange rate fluctuations, particularly the US dollar, the Chinese Renmimbi and the Brazilian Real). The entry into the Group of CZ Elettronica S.r.l., as described in Significant events in 2025, for a total amount of 1,582 thousand Euro, contributed to the increase in revenues. Without considering this effect, revenues in 2025 would be down 0.5% compared to 2024.

Analysing the trend by product family, there was a decrease in the products of the instrument family (-5.2%), which was lower for the products of the power control family (-2.9%). Sales of products in the solution range, within which the products manufactured by the newly acquired CZ Elettronica S.r.l. fall, went up instead (by a total of +6.3%).

In the analysis of revenues by geographical region, compared with those recorded in 2024, revenues increased in the national market (+5.5%), mainly due to the revenues generated by the newly acquired CZ Elettronica S.r.l. On the other hand, revenues decreased in Europe (overall -3.1%) and in the Americas (overall -12.5%), the latter area being affected by the fluctuations of the Brazilian Real and the US dollar (not taking into account the negative exchange rate fluctuations, the decrease in revenues compared to the same quarter of the previous year would be -7.7%).

Order intake in 2025 amounted to 47,893 thousand Euro and was overall higher than the figure for the previous year (1.5%, which would be essentially in line without the contribution made by the newly acquired subsidiary CZ Elettronica S.r.l.). The backlog at 31 December 2025 was down from the figure at 31 December 2024 (-1.5%).

In the fourth quarter of 2025, revenues amounted to 14,154 thousand Euro, 4.9% higher than in the same period in the year 2024, when they came to 13,499 thousand Euro. Without considering the revenues generated in the quarter by the newly acquired subsidiary CZ Elettronica S.r.l., they would be up by 3.1%.

EBITDA for the period ended 31 December 2025 was positive in the amount of 3,746 thousand Euro (equal to 6.7% of revenues), down by 910 thousand Euro compared to the figure reported at 31 December 2024, of 4,656 thousand Euro (8.5% of revenues). Considering the same scope, thus excluding the results of CZ Elettronica S.r.l. (which joined the Group in April 2025), EBITDA in 2025 would be down by 760 thousand Euro compared to the previous year. Overall, the change is mainly attributable to lower sales margins, due to the different product and geographical mix, as well as higher customs duties incurred for trade with subsidiaries. Higher personnel costs necessary to strengthen the business's workforce also contributed to the decrease in EBITDA in the period compared with the previous year.

EBIT of 2025 was positive and amounted to 274 thousand (0.5% of revenues). This compares with a positive EBIT at 31 December 2024 of 1,359 thousand Euro (2.5%), showing a decrease of 1,085 thousand Euro (which would amount to 880 thousand Euro when considering the same scope of consolidation). The change in EBIT compared with the comparative period is attributable to the same dynamics described for EBITDA.

Comparing the figures by quarter, EBIT in the fourth quarter of 2025 was negative by 241 thousand Euro (-1.7% of revenues), compared with the negative figure of 167 thousand Euro (1.2% of revenues) in the same quarter of 2024. The decrease, amounting to 74 thousand Euro, mainly relates to the lower margin on sales in the quarter compared to the same period of the previous year, influenced both by the different composition of sales for the period and by the higher impact of customs duties, as well as higher operating costs required for the execution of the business strategy.

Investments

Investments made during 2025 totalled 4,488 thousand Euro. Investments in "Intangible assets" amounted to 1,392 thousand Euro, of which 1.044 thousand Euro referred to the capitalisation of development costs for the new range of static units and new programmable automation products. The remainder related to the purchase of software programmes and licences as well as to the development of the company's management software.

Investments in "Tangible assets" amounted to 3,096 thousand Euro, of which 2,951 thousand Euro were made by the Parent Company Gefran S.p.A. (873 thousand Euro for the introduction of production machinery to increase the capacity and production efficiency required for new products and 2,022 thousand Euro for the renewal of buildings, in particular for the redevelopment launched for the new areas that will host the operational activities of the business, as well as the Company's headquarters).

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5 SIGNIFICANT EVENTS IN 2025

• / On 31 January 2025 Gefran S.p.A. signed an investment agreement to acquire a minority stake in 40Factory S.r.l. with operational headquarters in Piacenza, a tech scale-up that offers manufacturers of industrial machines and end-users an Industrial loT (Internet of Things) platform for the collection and use of plant data and that also owns a generative artificial intelligence system dedicated to providing support in the use of industrial machines.
• The operation is based on an awareness of the strategic importance of data for modern manufacturing companies. Their collection, management, and analysis are essential to optimize processes, improve efficiency, and support decisions. Indeed, thanks to the expertise and IoT services of 40Factory, Gefran is developing its ability to process and transform data collected in the field into more valuable information for customers, further strengthening its role as a strategic partner in the digital and sustainable transformation of production processes.
• / On 13 February 2025, the Board of Directors of Gefran S.p.A. examined the preliminary consolidated results at 31 December 2024.
• / On 13 March 2025, the Board of Directors of Gefran S.p.A. unanimously approved the annual financial statements, the consolidated financial statements and the Sustainability Report as at 31 December 2024.

The Board of Directors also resolved to propose to the Shareholders' Meeting the distribution of a dividend of 0.43 Euro per share in circulation (not including own shares), by using retained earnings to the necessary extent.

Moreover, the Board of Directors resolved to propose to the Shareholders' Meeting to allocate part of the net profit for 2024 to a specific reserve pursuant to Article 1, para. 436 – 444 of Law No. 207 of 30 December 2024, and to allocate the remaining part of 2024 profit to the retained earnings reserve, in line with the Group's value creation strategy for its shareholders, safeguarding the Group's growth.

During the same meeting, the Board resolved to propose to the Shareholders' Meeting approval of the authorisation to purchase and dispose of, on one or more occasions, a maximum of 1,440,000.00 ordinary shares in the Company, equal to 10% of its share capital. The authorisation was requested for a period of 18 months from the date of the shareholders' resolution. / On 18 March 2025, Gefran S.p.A. signed an investment agreement to acquire a majority stake in CZ Elettronica S.r.l., together with its subsidiary Mecatronica S.r.l., both based in the province of Vicenza. The agreement provides for Gefran's entry into the shareholding structure of CZ Elettronica S.r.l. through the sale of shares, following which Gefran S.p.A. will hold a 60% stake in the share capital for a total consideration of 870,000 Euro. CZ Elettronica S.r.l. specializes in the development of custom turnkey plant solutions for the steel, textile and plastic sectors, and manufactures systems for regulating industrial motorization, standing out on the market for its constant innovation, its use of the most modern digital technologies and its team of highly

With this operation, Gefran integrates and enriches its wealth of expertise by strengthening its ability to offer tailor-made application solutions to its customers.

• qualified technicians.
• of 40Factory S.r.l.

/ On 20 March 2025, the investment agreement signed on 31 January 2025 was finalised through a capital increase of 40Factory S.r.l., fully paid up and subscribed by Gefran S.p.A. for a total consideration of 4 million Euro (paid in cash, using its own funds), as a result of which Gefran S.p.A. now holds 22% of the share capital

• / On 1 April 2025, the Swiss subsidiary Sensormate AG adopted the new name Gefran Schweiz AG.
• / On 14 April 2025, the investment agreement signed on 18 March 2025 was finalised through the sale of part of the share capital of CZ Elettronica S.r.l. to Gefran S.p.A., for a total consideration of 870 thousand Euro (paid in cash, using its own funds), as a result of which Gefran S.p.A. now holds 60% of the Company.
• / On 29 April 2025, the Ordinary Shareholders' Meeting of Gefran S.p.A. resolved to:
• − Approve the 2024 annual financial statements and distribute an ordinary dividend, gross of withholding taxes provided for by law, of 0.43 Euro per eligible share, by using retained earnings to the necessary extent (ex-dividend date 5 May 2025, record date 6 May 2025 and payment from 7 May 2025).
• − Approve the allocation of a portion of the profit for 2024, amounting to 8.2 million Euro, to a specific reserve pursuant to Article 1 (paragraphs 436-444) of Law no. 207 of 30 December 2024, and the allocation of the remaining portion of the profit for 2024, amounting to 2 million Euro, to the retained earnings reserve.
• − Authorise the Board of Directors to purchase a maximum of 1,440,000 own shares with a face value of 1 Euro each, within 18 months from the date of the Shareholders' Meeting.

The Shareholders' Meeting, pursuant to Article 123-ter of the Consolidated Law on Finance, also held a binding vote that approved the Group's 2025 Remuneration Policy and also held an advisory and non-binding vote that approved its 2024 Remuneration Report.

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78

• / On 13 May 2025, the Board of Directors of Gefran S.p.A. unanimously approved the consolidated results of the Group at 31 March 2025.
• / On 5 August 2025, the Board of Directors of Gefran S.p.A. unanimously approved the consolidated results at 30 June 2025.
• / With effect from 4 September 2025 (with only the tax effects being dated back to 1 January 2025), the company with Mecatronica S.r.l. was merged by incorporation with CZ Elettronica S.r.l., formerly its parent company. In the new corporate structure, CZ Elettronica S.r.l. maintains both its name and the articles of association.
• / Following the transaction dated 19 September 2025, Anima SGR now holds a significant stake in Gefran S.p.A., the Parent Company of the Gefran Group, amounting to 5.258% of its share capital; it should be noted that this stake is held under a discretionary asset management arrangement.
• / With effect from 1 October 2025, the employment relationship with Patrizia Belotti, Chief People & Organization Officer and Chief Communication Officer of the Gefran Group, was terminated. Her two roles

are provisionally assigned to Chairwoman Maria Chiara Franceschetti and to Vice Chairwoman Giovanna Franceschetti, respectively.

• / Following purchase and sale transactions on the regulated market, ANIMA SGR, with form 120/A, notified, as required by CONSOB regulation, that the 5% holding threshold had been exceeded. The exact percentage notified on 8 October 2025 was 5.258%.
• / On 13 November 2025, the Board of Directors of Gefran S.p.A. received the resignation of Andrea Franceschetti from the position of Vice-Chairman and Chief Executive Officer with immediate effect. Andrea Franceschetti will continue to serve as a Non-Executive and Non-Independent Director.
• / With effect from 19 November 2025, the employment relationship with Karsten Just, Chief Sales Officer of the Gefran group, came to an end. The role is provisionally assigned to Marcello Perini, already Chief Executive Officer of the Group.

6 SIGNIFICANT EVENTS AFTER THE END OF 2025

/ On 23 February 2026, Gefran S.p.A. exercised, in advance, the purchase option already provided for in the agreements with the sellers, by acquiring the remaining 40% of the shares in CZ Elettronica S.r.l., for a consideration of 580 thousand Euro, thereby holding 100% of the Company.

The transaction allows Gefran to fully consolidate its control and further strengthen the Group's industrial and technological positioning, enhancing the expertise and know-how of C.Z. Elettronica S.r.l. and fostering greater strategic and operational integration within the organisation.

It should be noted that, as at 31 December 2025, the Group recognised the consideration as payables in accordance with IAS 32 and therefore there are no third-party shares.

Annual Financial Report at 31 december 2025 Gefran Group

7 OUTLOOK

Given the latest international estimates and domestic performance indicators, the global economic scenario for 2025–2026 shows signs of resilience compared to previous assessments. The International Monetary Fund confirms a further strengthening of the outlook, with a global growth forecast of +3.3% in 2026 (+3.2% in 2027), supported by the adaptation of global value chains and a strong boost to investments in artificial intelligence technologies.

Regarding the Eurozone, the IMF estimates 1.3% growth in 2026 (+1.4% in 2027), showing an improvement in data from some member countries and a gradual stabilisation of the economic cycle. The Eurosystem projections published by the ECB in December 2025 confirm an expectation of 1.2% growth in the area in 2026, with a further strengthening expected in the following two years, supported by the increase in household incomes, the improvement in financing conditions and the recovery of external demand.

According to the Bank of Italy's Economic Bulletin No. 1/2026, the global economy continues to expand but remains exposed to downside risks due to trade and geopolitical tensions. In the euro area, growth remains moderate but supported by services, while inflation is gradually easing. For Italy, the Bank of Italy estimates GDP growth of 0.6% in 2026, supported mainly by investments and, more selectively, by exports, in the face of still cautious domestic demand and increasing international competition in miscellaneous industrial sectors. In the two-year period 2025–26, exports were affected by trade tensions and the contribution is expected to become more favourable again from 2027 onwards.

In this macroeconomic context, the Group ended 2025 with an overall positive performance, confirming its resilience already evident in the first nine months of the year. Revenues grew by 4.5% YoY, mainly driven by the sensors business and the contribution of recent acquisitions, though currency pressures negatively impacted results in some geographical regions, particularly Asia and the Americas. Operating margins remained positive, although affected by increases in operating costs, changes in the product mix and the volatility of exchange rates, which resulted in a reduction in net profit compared with the previous fiscal year.

Management's commitment focused on strengthening manufacturing processes, product innovation and the evolution of technological supply, with an increasing focus on digital applications and data enhancement, in continuity with the priorities highlighted in the 2024

financial statements.

Overall, 2025 saw a higher order intake than the previous year, a trend confirmed in the first two months of 2026 despite a slight decrease in revenues compared with the same period in 2025.

During 2025, the Group continued to place great emphasis on the vertical integration of production processes and the strengthening of its technical and technological skills, elements that have remained fundamental to maintaining competitiveness and supporting business growth. In line with the strategy consolidated in previous years, investments were made in automating facilities and in training personnel, constantly focusing on both domestic and international operations. These choices enabled us to address the challenges of a market characterised by rapid changes and a growing demand for innovation.

The Group's business strategy in 2025 continued to focus on market development and the generation of new orders, which still remain priority objectives. Commercial activity focused not only on historical industrial sectors such as plastics, metal and glass, but also strengthened its visibility in emerging segments such as mobile machinery and the semiconductor industry, where significant results were achieved. Analyses of the 2025 report show that these initiatives contributed to growth, albeit moderate, in a complex and uncertain environment. It should also be noted that any positive developments in global geopolitical tensions might further support the Group's performance in the near future.

Looking ahead to 2026, there is mixed demand across sectors and geographical regions, with the most technologically advanced sectors showing greater buoyancy, while caution remains in the most cyclical segments. The Asian markets, at the beginning of the year, confirm the dynamism expressed during the previous year, while the European countries from which the Group derives its turnover remain at lower business levels than the average in previous years. In this scenario, the Group expects to be able to maintain a path of moderate revenue growth and positive operating margins, continuing to closely monitor developments in international markets — in particular currency trends, demand in the relevant industrial sectors and macroeconomic risks, including any impacts arising from the war in the Middle East, which are currently difficult to predict — with the aim of further strengthening its competitive position and generating sustainable value for all stakeholders.

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Annual Financial Report at 31 december 2025 Gefran Group

As at 31 December 2024, Gefran S.p.A. held 198,405 shares, equal to 1.38% of the total, with an average book value of 8.6483 Euro per share, and a total value of 1,716 thousand Euro.

OWN SHARES 9

During 2025 and as at the date of this publication, no trading activities took place; therefore, the situation is unchanged with respect to what is described above.

DEALINGS WITH RELATED PARTIES

On 12 November 2010, the Board of Directors of Gefran S.p.A. approved the Internal Procedure for Dealings with Related Parties, in accordance with Consob Resolution no. 17221 of 12 March 2010. The procedure in question was subsequently updated to implement the new provisions of EU Directive 2017/828 (so-called "Shareholders' Rights II"), which was transposed into Italian law by Italian Legislative Decree no. 49 of 2019, with regard to primary legislation, and by Consob Resolution no. 21624 of 10 December 2020, with regard to secondary legislation.

This document, the current version of which was approved on 12 February 2026 by the Board of Directors of Gefran S.p.A., is published in the section "Investor/ Governance/Documents, procedures and shareholders' agreements" of the Company's website, available at https://www.gefran.com/governance/ documents-and-procedures/.

The Procedure is based, inter alia, on the following general principles:

/ ensuring the essential and procedural transparency

• and probity of dealings with related parties;
• tions with related parties.

/ providing the Board of Directors and the Board of Statutory Auditors with an appropriate assessment, decision-making and control tool regarding transacIt is structured as follows:

• / First section: definitions (related parties, significant and insignificant transactions, transactions of negligible amount, etc.).
• / Second section: procedures to approve significant and insignificant transactions, exemptions.
• / Third section: obligations to disclose and supervise compliance with the procedure.

Please refer to Note 40 of the Specific explanatory notes to the consolidated financial statements for details of the transactions between Group companies and related parties.

REPORT HIGHLIGHTS REPORT ON OPERATIONS – PROFILE OF THE GROUP

REPORT ON OPERATIONS – DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

REPORT ON OPERATIONS DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

Gefran Group

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Annual Financial Report at 31 december 2025

In the course of its business, the Gefran Group is exposed to various risk factors, which, should they materialise, may have a significant effect on its economic, financial, operational and reputational situation as well as on health and safety of people and on the environment.

The analysis of risk factors, along with an integrated assessment of their impact and likelihood of occurrence, are the prerequisite for the creation of value in the organisation: the ability to manage risks helps the Company to face its corporate and strategic choices with awareness and confidence, as well as helping to prevent negative impacts.

Gefran has long implemented a structured Enterprise Risk Management (ERM) system integrated into its business processes and organisational structures, connected with actions that contribute to the achievement of the Group's strategic objectives. It is based on identifying focus areas and specific figures (Risk Owners & Action Owners), and on providing for the periodic identification, assessment, management and monitoring of the main risk factors. This activity allows for the identification of situations that might jeopardise the achievement of strategic objectives and for taking the appropriate decisions, aimed at mitigating risk exposure.

With the aim of increasing the integration between ERM activities and corporate processes in order to guarantee their constant alignment with (strategic, management and operational) decisions and ensure sustainability over time, Gefran has further developed its ERM model in recent years. The latest developments have been the integration of ESG-related risks into the Risk Model as potentially impactful risks and the strengthening of the connection between the Group's assessed risks and additional strategic elements, such as:

• 1. the potentially affected objectives of the Industrial Plan;
• 2.the topic-related pillars of the Strategic Sustainability Plan;
• 3.the taking out of insurance policies to mitigate such risks;
• 4.the double materiality assessment, also in light of ESG issues and changes in legislation on sustainability reporting (known as CSRD).

During the fiscal year, Gefran strengthened its risk management system through a process of integration between Enterprise Risk Management and the Double Materiality Assessment. This activity was carried out with the aim of enhancing the value of the analyses of Impacts, Risks and Opportunities, and enriching the different processes, favouring a more consistent and cross-cutting approach to the management of company risks while promoting a long-term, value-creating approach.

The integration enabled the consolidation of the relationship between the catalogue of company risks, the objectives of the Strategic Sustainability Plan and the policies adopted for the management of individual topics. At the same time, the elements emerging from the double materiality assessment were incorporated into the risk model, ensuring a more complete and up-todate representation of the impacts, risks and opportunities identified in the double materiality assessment as relevant to the organisation, as well as to the ESRS and the relevant topic.

A tool dedicated to the collection and structured consultation of information was also developed to support the process, which is useful both for timely analysis and for having a consolidated picture of the various risk categories.

This process of integration contributes to improving the circularity of information, enabling the Company to have a more inclusive and coherent risk map, capable of representing more accurately the interconnection between company performance and sustainability.

Currently, the model provides that, for each risk assessed, a link is identified with the objectives included in the Industrial Plan and, in the case of materiality, also with the elements of the Strategic Sustainability Plan. In addition, for the purposes of the Double Materiality Assessment required by the Corporate Sustainability Reporting Directive, a relationship with the sustainability issues included in the topical ESRS - the single Sustainability Reporting Standards issued by EFRAG and in force since 1 January 2024 - is identified for each risk. The analysis, conducted in 2024 and validated by the proposed Corporate Bodies, took into account both Gefran's activities and the processes carried out along the value chain, and was crucial for identifying the Impacts, Risks and Opportunities that are relevant to the Group.

Enterprise Risk Management Policy

The system is governed by the Enterprise Risk Management Policy (the ERM Policy) approved by the Board of Directors at its meeting on 8 November 2023 and last updated on 4 February 2026. It defines the governance as well as the steps of the ERM process, providing the guidelines to execute the different steps.

More specifically, this policy governs:

• / the reference principles on which the ERM model is based;

• / the roles and responsibilities of the functions and/or individuals involved in the ERM process;

• / the steps involved in the process of identifying, assessing and managing risks;

• / the main information flows whose adoption enables adequate dissemination of risk information and informed decision-making.

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Risk Governance

The functioning of the ERM system involves the structured participation of specific company roles and departments, as well as the involvement of the main supervisory bodies. In line with the recommendations of the Corporate Governance Code, the governance model governing the roles and responsibilities of the subjects and bodies involved in the process has thus been defined.

Several subjects, bodies and control levels have been identified, as described below.

The Board of Directors (BoD) plays a primary role in the direction and oversight of the risk management system and specifically: (i) defines, in line with the organisation's strategies, the guidelines for risk management, so that the main risks pertaining to the Group are identified, measured, managed and monitored; (ii) periodically evaluates the adequacy and effectiveness of the risk management system with respect to the assumed risk profile and the changes affecting the Group's reference context; (iii) delves into the information relating to the risks that emerged during the risk assessment.

The Control and Risks Committee performs consultative, recommendatory and preparatory activities for the Board of Directors and the Chief Executive Office. Specifically: it (i) supports, with an adequate investigative activity, the assessments and decisions of the Board of Directors regarding the risk management system, and periodically reports on its adequacy; (ii) supports the Chief Executive Officer in fulfilling its tasks of design and implementation of the risk system; (iii) examines and discusses the summary document aimed at illustrating the main risks that have emerged to the Board of Directors.

The Chief Executive Officer (CEO) is responsible for establishing and maintaining the internal control and risk management system. Specifically, the Chief Executive Officer: (i) ensures the execution of the guidelines defined by the Board of Directors, promoting the establishment and maintenance of an effective ERM process and constantly verifying its adequacy with respect to the dynamics of operating conditions and the legislative and regulatory landscape; (ii) validates the ERM approach, methodology and related support tools, periodically evaluating any development lines; (iii) validates the results of the risk assessment; (iv) monitors, with the support of the Risk Management and Internal Audit Functions, the implementation status and effectiveness of the defined risk response strategies; (v) periodically reports to the Board of Directors and the Risk Control Committee, with the support of the Risk Management Function, on the results of the risk assessment and, in general, on the evolution of the Group's overall risk profile and its consistency with the strategic objectives; (vi) evaluates the possible acceptance of risk.

The Risk Management Function has the roles and responsibilities attributed to the Group's Legal and Corporate Affairs Department. Coordinating with the Chief Executive Officer, it is responsible for defining, implementing and maintaining an ERM methodology, promoting a systematic, structured and homogeneous process for identifying, measuring and managing risks. It conducts the risk assessment process, providing methodological support for the identification, analysis and management of risks. In addition, it periodically monitors the progress and effectiveness of the defined risk response strategies, as well as the evolution of the organisation's risk profile.

Management (Risk Owners & Action Owners) has the primary responsibility for the identification, assessment and management of risks that pertain to its function or area of expertise. In addition to the Top Management of the Parent Company Gefran Spa, Management includes also the General Managers of the subsidiaries who, depending on the evolution of the reference context, can be involved in the process. Specifically, each Risk Owner is therefore responsible for: (i) identifying and assessing the risks that may compromise the achievement of the Group's objectives, as well as its performance; (ii) proposing appropriate mitigation actions aimed at bringing the main corporate risks back to levels deemed "acceptable", also ensuring their implementation and periodic monitoring; (iii) identifying any support teams for the definition and implementation of the mitigation actions necessary to reduce or prevent the negative consequences of risks. Action Owners are instead responsible for ensuring that the mitigation actions proposed to mitigate risks are implemented in line with the defined deadlines.

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Enterprise Risk Management Process Stages

The process conducted by Gefran involves several stages:

PERIODIC RISK ASSESSMENT

It involves periodically updating (typically once a year) the Group's risk profile by reviewing the risks mapped in previous risk and emerging risk assessments.

It is carried out through interviews with the Managers of the Parent Company and the main subsidiaries; the process of reviewing the risk catalogue is based on the results of the previous risk assessment, which are confirmed, modified and/or eliminated to provide an updated view of the risk profile.

This allows the Board of Directors and management to assess knowledgeably those risk scenarios that might compromise the achievement of strategic goals and take additional action to mitigate or manage significant exposures, thus strengthening the Group's corporate governance and Internal Control system.

Following the last risk assessment process carried out, there was a general strengthening of risk management safeguards, together with the identification of new emerging risk areas. This also allowed for the progressive alignment of the risk management model with the Plan and the execution of the defined strategy.

The main areas and categories of risk identified include cybersecurity, artificial intelligence and innovation, geopolitical tensions, product sustainability and dependence on key figures, and in particular they concern:

• / the adoption of new technologies (e.g., artificial intelligence) and new methods of quick working increase exposure to hacker attacks, an ever-evolving trend that can lead to disruptions in business operations and loss of sensitive data at ever increasing costs, as well as vulnerabilities of products with IT/OT functionalities;
• / the importance of continuous investments in product innovation, to ensure alignment with the market's best technologies and support the pursuit of sustainability objectives;
• / reliance on key personnel represents a potential risk factor in terms of business continuity and know-how management;
• / the organisation monitors this aspect by assessing the level of concentration of competences within key staff members, and by adopting measures aimed at promoting structured and shared management of company knowhow and supporting process efficiency to ensure business continuity;

/ the political and economic instability of the Countries in which the Group produces and recent protectionism policies and barriers to entry might damage the competitiveness of the Group's products, increasing production costs and adversely affecting the management of global supply chains, as well as creating difficulties in entering or staying on foreign markets.

The analysis showed that some of these areas were already considered within the Gefran risk model; in these cases, the pre-existing risks were updated and integrated as necessary. For one of the new critical areas identified, a specific risk sheet was drawn up, thus ensuring a more complete and targeted coverage with respect to business requirements.

PERIODIC RISK MONITORING

This involves monitoring the progress and implementation of mitigation actions against the most significant risks (so-called Tier 1 or Top Risks) identified during the previous risk assessment, as well as the evolution of risk exposure.

REPORTING

During this stage, the results of the risk assessment are formalised and shared with Management and Supervisory bodies.

Description of the Enterprise Risk Management process and information flows

The periodic update of the Group's risk profile consists in reviewing previously mapped risks and identifying emerging risks, for the purpose of defining the so-called risk catalogue. The activity is carried out through interviews with the managers of the Parent Company and the main subsidiaries, and is based on the results of the previous risk assessment. The assessment is repeated periodically (at least once a year) taking into account the actions taken to mitigate risks and the evolution of the contingent situation.

In conducting the period risk assessment, Management involved in the process must use a clearly defined shared methodology to identify and assess specific risk events in terms of the probability of them actually occurring, their impact and the degree of adequacy of the existing Risk Management system, according to the following definitions:

/ probability of a certain event occurring within the time horizon of the Plan, measured on the basis of a scale from "improbable/remote" risk (1) to

• "highly probable" (4);

/ impact: depending on the category, an estimate of the economic and financial, HSE, reputational impacts or of the repercussions for operations

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EXTERNAL RISKS

1 COUNTRY/MARKET

2 FINANCIAL

• / [1.1] Macroecoomic context / [1.2] Instability of the Countries in which the Group produces or sells
• / [1.3] Catastrophic Events / Business Interruption
• / [1.5] Competition
• / [1.6] Unexpected changes in demand (including consumer habits)

EXTERNALRISKS	STRATEGICRISKS	NATUREOF THE RISK
1 COUNTRY/MARKET	3 STRATEGIC	MACRO RISKCATEGORY
/ [1.1] Macroecoomic context/ [1.2] Instability of the Countries in which the Groupproduces or sells/ [1.3] Catastrophic Events / Business Interruption/ [1.4] Evolving law, regulations and industry standards/ [1.5] Competition/ [1.6] Unexpected changes in demand (includingconsumer habits)	/ [3.1] Business sustainability/ [3.2] Investment decision/ [3.3] Product Portfolio/ [3.4] Peoduct/process innovation/ [3.5] Effectiveness / Delay of short-, medium-,and long-term strategies/ [3.6] Effectiveness of extraordinary transactions/ [3.7] Strategic planning/ [3.8] Effectiveness of Crisis Management Plans	SUB-CATEGORYOF RISK
2 FINANCIAL/ [2.1] Unpredictability of raw material prices /financial markets	/ [3.9] Dependence on key customer/ [3.10] Dependence on contractor/critical suppliers/ [3.11] Digital Transformation & ChangeManagement

• financial markets
• / [2.2] Commercial/financial counterparts
• / [2.3] Exchange rate / [2.4] Interest rate
• / [2.5] Liquidity
• / [2.6] Capital availability / debt repayment capacity

within the time horizon under consideration, measured on the basis of a scale from "insignificant" (1) to "critical" (4);

/ level of risk management or of maturity and efficiency of existing risk management systems and processes, measured on the basis of a scale from "optimal" (1) to "to be initiated" (4).

The results of risk exposure measurements are then represented in the so-called Heat Map, a 4x4 matrix which, combining the variables in question, provides an immediate overview of risk events considered particularly significant.

In addition, the identified and assessed risks are linked to the objectives of the Industrial Plan, in order to incorporate risk management into the Group's strategy, as well as to the pillars of the Strategic Sustainability Plan, and, finally, to the sustainability issues (Topics and Sub-Topics) considered in the single reporting standards issued by EFRAG (ESRS).

The main risks detected and assessed through ERM are described and discussed with all organisations of significance for the purposes of the Internal Control and risk management system and with the Board of Directors.

The overview of the risks the Group is exposed to allows the Board of Directors and Management to reflect on the Group's propensity for risk and identify risk management strategies to be adopted, or assess which risks and priorities are considered to require new mitigation actions, or improvement or optimisation of ongoing ones, or simple monitoring of exposure over time.

To ensure the adequacy of the risk management system and assess its effectiveness, a reporting system is provided also for monitoring the mitigation actions taken by individual functions.

Risk reporting and related information provides an authentic view of the strengths and weaknesses of risk management. The disclosure of this information to key Stakeholders also supports decision-making processes and increases transparency on risks that might affect the targets' achievement. Systematic monitoring of the risks identified and assets to manage them according to established metrics enables timely and proactive responses.

The mapped risks are broken down, depending on seriousness, into three categories (Tier 1, Tier 2 and Tier 3), taking into account both the risk in the abstract (the so-called inherent risk), and the mitigation effects of the internal control system (so-called residual risk). Both types have been evaluated.

Comparing the residual risks and inherent risks reveals the safeguards, actions taken and the effectiveness of the internal control system.

Risk Model

The risks mapped are represented in the Risk Model and grouped into four categories and eleven families, outlined below:

NATURE OF THE RISK

MACRO RISK CATEGORY

SUB-CATEGORY OF RISK

INTERNAL

RISKS

4 GOVERNANCE AND INTEGRITY

5 OPERATIONAL AND REPORTING

6 LEGAL AND COMPLIANCE

7 IT

8 HUMAN RESOURCES

/ [4.1] Change resistence

• / [4.2] Integrity of behavior/fraud

• / [4.3] Delegations and Powers

• / [4.4] R&R (Rles and Responsibilities) / SoD

• / [4.5] Direction and government, including foreign branches

• / [7.1] IT & Data Security (Cybersecurity and SoD)

• / [7.2] Disaster Recovery / Business Continuity

• / [7.3] IT Governance

• / [7.4] IT infrastructure/technology capacity limits

• / [7.5] Web Domains

/ [8.1] Attraction and Retention

• / [8.2] Dependence on key figures

• / [8.3] Poor communication between the first lines of management

• / [8.4] Timeliness of communications regarding organisational changes

• / [8.5] Risk of Ageing

• / [8.6] Staff unavailability

• / [8.7] Staff Performance

• / [5.1] Adequacy/saturation of production capacity

• / [5.2] Incorrect/inefficient production planning

• / [5.3] Obsolescence/Unavailability of plant / machinery

• / [5.4] Product quality / Recall

• / [5.5] Obsolescence stock

• / [5.6] Unavailability of raw materials/ semi-finished goods/ other goods and extra cost of supplies

• / [5.7] Reliability of supplier portfolio

• / [5.8] Ineffectiveness of sales channels

• / [5.9] Ineffectiveness/reducing prices, complexity and extra business costs

• / [5.10] Budget, Planning and Reporting

• / [5.11] Unavailability of data and information

• / [5.12] Transfer Pricing

• / [5.13] Orders execution risk

• / [5.14] Parcelizing out suppliers

• / [5.15] Delays in the execution of investments plans

• / [5.16] Interruptions/Delays in logistics

• / [6.1] Protection of product exclusivity

• / [6.2] Litigation

• / [6.3] Contractual/force majeure risks

• / [6.4] Compliance with lobour law regulations

• / [6.5] Compliance with 262 / financial reporting

• / [6.6] Compliance with of tax regulation

• / [6.7] Compliance with industry regulation (e.g., ISO)

• / [6.8] Compliance with customs regulations

11 GOVERNANCE

• / [9.1] Natural disasters

• / [9.3] Pollution and contamination (e.g., waste management, emissions, spills and wastewater, noise pollution)

• / [9.4] Resource availability and consumption (e.g. nonrenewable resources: water, gas)

• / [9.5] Product sustainability (e.g., product endof-life management, environmental impact of products)

• / [9.6] Evolution/adaptation of environmental regulations (e.g., carbon tax, Emission Trading Scheme)

• / [11.1] Corporate integrity, anti-money laudering and anti-corruption

• (e.g., Code of Ethics, policies and procedures)

• / [11.3] Governance of ESG topics

• / [11.4] Reporting on ESG topics

ESGRISKS	NATUREOF THE RISK
9 ENVIRONMENTAL	10 SOCIAL	MACRO RISKCATEGORY
/ [9.1] Natural disasters/ [9.2] Climate change (physical and transitional risks)/ [9.3] Pollution and contamination (e.g., wastemanagement, emissions, spills and wastewater,noise pollution)/ [9.4] Resource availability and consumption (e.g.nonrenewable resources: water, gas)/ [9.5] Product sustainability (e.g., product endof-life management, environmental impact ofproducts)/ [9.6] Evolution/adaptation of environmentalregulations (e.g., carbon tax, Emission TradingScheme)	/ [10.1] User health and safety/ [10.2] Employees health and safety/ [10.3] Sustainable supply chain management/ [10.4] Respect for humn/workers' rights/ [10.5] Non-compliance/compliance with Privacyregulations/ [10.6] Biological risks/ [10.7] Customer experience, customersatisfaction and claims/ [10.8] Responsible Marketing and communicationtransparency/ [10.9] Non-compliance with product regulations	SUB-CATEGORYOF RISK
11 GOVERNANCE/ [11.1] Corporate integrity, anti-money lauderingand anti-corruption/ [11.2] Non-compliance with internal regulations(e.g., Code of Ethics, policies and procedures)/ [11.3] Governance of ESG topics/ [11.4] Reporting on ESG topics	(e.g., labeling)/ [10.10] Evolving expectation of stakeholders andend-users in terms of environmental and socialperformance/ [10.11] Evolution/compliance with H & Sregulations/ [10.12] Relations with local communities/ [10.13] Professional development and compensation/ [10.14] Generational transitions/ [10.15] Industrial relations/ [10.16] Business climate/ [10.17] Smart working/remote working managing	Focus HR

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Annual Financial Report at 31 december 2025 Gefran Group

RISKS ASSOCIATED WITH COUNTRIES AND 1 MARKETS

Risks associated with the general economic conditions and market trends

The most recent projections and estimates on general economic performance and the markets in which the Group operates are presented in the paragraph Outlook of this Report on Operations, to which reference is made.

In this scenario, where there are still uncertainties about the geopolitical future, it should be noted that the Group does not possess strategic assets in the territories currently involved in the hostilities and that sales in these regions are limited. Although the scenario is changeable, given current considerations, Gefran does not believe that the hostilities will have a significant direct impact on its activities and, consequently, on its ability to generate income in addition to what has already been absorbed during the year.

Risks associated with the market structure and competitive pressure

Gefran operates in open and highly competitive markets in terms of product quality, innovation, price competitiveness, product reliability and customer service to machinery manufacturers.

The Group operates in a very crowded competitive environment: operators which are large groups may have greater resources or better cost structures, both in terms of economies of scale and factor costs, enabling them to implement aggressive pricing policies.

The Risk Model includes risks of different kinds:

• / Country/market risks arising from factors such as macroeconomic environment, changes in the regulatory and/or market environment, changes in economic or political stability in Countries or geographical regions;
• / financial risks connected with the availability of funding, credit and liquidity management, and/or volatility of key market variables (e.g. commodity prices, interest rates, exchange rates);
• / strategic risks connected with the company's strategic decisions regarding product portfolio, extraordinary operations, innovation, digital transformation, etc. which could influence the Group's performance;
• / governance and integrity risks connected with Group/Company governance or with professionally incorrect behaviour which does not conform to the Company's ethical policy and could expose the Group to possible sanctions, undermining its reputation on the market;
• / operating risks and reporting risks connected with the efficacy/efficiency of company processes, with potential negative consequences for the Company's performance and operations, and/or connected with the possibility that planning, reporting and control processes may not be sufficient to assist

Management with strategic decision-making and/or monitoring of the business;

• / legal and compliance risks pertaining to management of legal and contractual aspects and conformity to national, international and industry laws and regulations applicable to the Company;
• / IT Risks connected with the adequacy of Information Technology systems for supporting the current and/or future requirements of the business, in terms of infrastructure, integrity, security and availability of data, information and information systems;
• / human resources risks connected with the attraction, retention, availability, management and development of the resources and skills necessary to conduct business and management of trade union relations;
• / ESG-specific risks tied to sustainability issues, divided among Environmental, Social and Governance risks.

External and internal risk factors are analysed below, classified according to the risk families described above.

Based on the economic and cash flows achieved in the last few years and available funds, and based on the results of ERM activities, there are currently no significant uncertainties that raise significant doubts as to the Company's ability to continue to operate as a going concern.

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The success of Gefran Group activities derives from its ability to focus its efforts on specific industrial sectors, concentrating on resolving technological problems and on customer service, thereby providing greater value to customers in the niche markets in which it competes.

To mitigate the impact of this risk, Gefran has invested in human resources through the inclusion of specialised personnel with a focus on innovation and innovative trends in technology.

Should the Group prove unable to develop and offer innovative or sustainable and competitive products and solutions that match those supplied by its main competitors in terms of price, quality, functionality, or should there be delays in such developments, sales volumes could decline, with a negative impact on the Group's economic and financial results.

Although Gefran believes that it can adapt its cost structure if sales volumes or prices decrease, the risk is that such a change will not be sufficiently large and timely, and thus there may be negative effects on the economic and financial situation.

Country risk

A significant portion of the Group's production and sales activities is carried out outside the European Union, particularly in Asia, the US, Brazil and Switzerland. The Group is exposed to risks relating to the global scale of its operations, including those relating to:

/ exposure to local economic and political conditions;

/ the implementation of policies restricting imports

/ the introduction of policies limiting or restricting for-

• and/or exports;
• / operating in multiple tax regimes;
• eign investment and/or trade;
• / possible disruptions in the supply chain.

Unfavourable political and/or economic developments in the countries in which the Group operates might adversely affect – the extent of which would vary by country – the Group's prospects, operations and economic and financial results. Such risk is, however, mitigated by

the fact that the production sites where there are specific productions, thus not easily interchangeable with productions of other countries, are operational in the USA and Switzerland, where the Country risk is reduced.

In the light of political developments linked to the ongoing conflicts, Gefran has formally expressed its desire to terminate business relations with customers residing in Russia and Belarus. Noting that the Group does not possess strategic assets in those regions and that the volume of business affected is modest, this decision has not significantly affected the ability of the Group to generate revenues.

In addition, the conflict in the Middle East is a source of uncertainty that might affect the international economic environment, with possible repercussions on supply chains, energy costs, and market stability, leading to possible overall cost increases. At present, Gefran constantly monitors the situation and remains alert to any developments that might directly or indirectly affect its operations, taking the necessary measures to mitigate emerging risks.

Risks associated with changes in the regulatory framework

Since Gefran makes and distributes electronic components used in various applications, it is subject to numerous legal and regulatory requirements in the various Countries in which it operates, as well as to the national and international technical standards applicable to companies operating in the same industry and to the products made and sold, with reference to the certifications required for the products.

Any changes in laws or regulations might entail (substantial) costs required to adapt the product characteristics or even bring about the temporary suspension of the commercialization of some products, which would consequently affect the generation of revenues.

Moreover, the enactment of other regulations that apply to the Group or its products, or changes in the regulations currently in force in the sectors in which the Group operates, also internationally, might force the Group to adopt more rigorous standards or limit its freedom of action in its areas of operation. These factors might entail costs relating to adapting production facilities

or product characteristics. This might have a negative impact on the Group's business, its operations and image and/or influence its ability to expand business in new markets.

Lastly, changes to or tightening of the regulatory environment by government bodies (supranational or national) in the areas in which Gefran operates might have an impact on the Group's economic results; this includes the introduction of increasingly stringent regulations to encourage sustainable business management and greater transparency on the impact of the business on the surrounding environment. In particular, by operating through production plants located in several Countries, Gefran is exposed to risks deriving from changes in labour safety regulations, although there are currently no areas that are not managed by the practices, operational procedures and management policies put in place.

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Annual Financial Report at 31 december 2025 Gefran Group

Exchange rate risk

As a global operator, the Gefran Group is exposed to market risks stemming from exchange rate fluctuations in the currencies of the various countries in which it operates.

Exposure to exchange rate risk is linked to the presence of production activities concentrated in some countries (particularly Switzerland, the United States and China) and sales in various geographic areas outside the Eurozone. This organisational structure generates flows in currencies other than the currency in the place of production, mainly the US dollar, the Chinese Renminbi, the Brazilian real, the Indian rupee, the Swiss franc, and the UK pound; production areas in the US, Brazil and China mainly serve their local markets, with flows in the same currency.

Exchange rate risk arises when future transactions or assets and liabilities already recorded in the statement of financial position are denominated in a currency other than the functional currency of the company conducting the operation. In order to manage the exchange rate risk resulting from future commercial transactions and the recording of assets and liabilities in foreign currencies, the Group first and foremost exploits so-called Natural Hedging, seeking to level out the incoming and outgoing flows on all the currencies other than the Group's functional currency; furthermore, where necessary, Gefran evaluates whether to establish hedging transactions on the main currencies, by means of the Parent Company signing futures contracts. However, since it prepares its consolidated financial statements in Euro, fluctuations in the exchange rates used to translate the financial statements of subsidiaries, originally denominated in local currency, may affect the Group's results and financial position.

Interest rate risk

Changes in interest rates affect the market value of the Group's financial assets and liabilities, as well as net financial charges for the income statement. The interest rate risk to which the Group is exposed mainly originates from long-term financial payables. The Group is exposed almost exclusively to fluctuations in the Euro rate, since the majority of bank loans have been arranged by Gefran S.p.A.

These are primarily variable rate loans that expose the Company to a risk associated with interest-rate volatility (cash flow risk). To limit exposure to this risk, the Parent Company evaluates and subsequently signs hedging contracts (so-called derivative contracts), specifically Interest Rate Swaps (IRS), which convert the variable rate to a fixed rate, or Interest Rate Caps (CAP), which set the maximum interest rate, thereby reducing the risk originating from interest-rate volatility.

Given developments in the current political and monetary situation, both domestically and internationally, the rise in interest rates represents a risk factor in the coming quarters, although this is limited by hedging contracts in place.

Risks associated with fluctuations in commodity prices

Since the Group's production mainly involves mechanical, electronic and assembly processes, exposure to energy price fluctuations is limited.

The Group is exposed to changes in basic commodity prices (e.g. metals) to a small extent, as the product cost component represented by these materials is quite limited.

On the other hand, the Group purchases electronic and electromechanical components for the production of finished products. These materials are exposed to cyclical price variations, even significant ones, that could adversely affect the Group's results.

Since 2022, the global market has experienced significant price increases due to the shortage of raw materials, particularly electronic components, leading to notable price volatility and impacting the overall costs of products. However, since 2024, the market has achieved relative stability in both prices and availability, a situation that was also confirmed in 2025.

Thanks to careful and efficient management of the supply chain and logistic-production processes within the organisation, any further price fluctuations are expected not to have significant impacts.

However, in a business context characterised by geopolitical tensions and/or unforeseeable events, such as rationing of critical raw materials by certain countries or the tightening of protectionist measures, this might lead to delays in the flow of goods, resulting in difficulties in ensuring continuity for customers and/or higher costs.

Risks associated with funding requirements and liquidity risk

The Gefran Group's financial situation is subject to risks associated with the general performance of the economy and trends in the sectors in which the Group operates.

Gefran's capital structure is strong; in particular, own funds total 100.8 million Euro, while liabilities amount to 62.7 million Euro.

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Gefran Group

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Risks associated with the implementation of the Group's strategy

Gefran's ability to improve profitability and achieve the expected profit margins also depends on successful implementation of its strategy. Group strategy is based on sustainable growth, which can be achieved through investments and projects for products, applications and geographical and vertical markets that lead to growth in profitability.

Gefran plans to implement its strategy by concentrating available resources on the development of its core industrial business, favouring growth in strategic products and markets that guarantee volumes, and in which the Group is a technological and market leader. Gefran continues to make changes to its organisational structure, work processes and staff know-how to increase specialisation in research, marketing and sales by product, market and application.

The strategy also aims to diversify as much as possible the markets and their customers to avoid repercussions from the performance of a single market or client.

Risks connected with delays in product/process innovation

Gefran operates in a sector that is strongly influenced by technological innovation. The Group's approach to innovation is often customer-driven. Inadequate or delayed product/process/model innovation to anticipate and/or influence customers' demands might have negative repercussions,

Operational management in 2025 generated positive free cash flow of 9.2 million Euro, after investing a total of 14.1 million Euro (of which 9.4 million Euro in technical investments and 4.7 million Euro in acquisitions of company shares).

At 31 December 2025, the net financial position was positive overall and equal to 32.8 million Euro, reflecting a reduction of 1.3 million Euro since the end of the previous year, also as a result of dividend distribution in the amount of 6.1 million Euro.

Credit lines and cash on hand are sufficient with respect to the Group's operations and the expected economic outlook. Most existing loan contracts were negotiated at variable rates, based on the Euribor, increased by an average spread of 0.92% over the last year. The variable rate was turned into a fixed rate through the subscription, during the loan opening period, of Interest Rate Swap (IRS) hedging contracts at an average rate of 2.84% excluding spreads.

In 2025, funding linked to the Simest call for digital transition was recorded for an amount of 297 thousand Euro.

Please refer to Note 23 of the Specific explanatory notes to the consolidated financial statements for further details on the Group's net financial position.

Credit risk

The Group has business relations with a large number of customers. Customer concentration is not high, since no customer accounts for more than 5% of total revenues. Supply agreements are normally long-term, because Gefran products form an integral part of the customer's product design, being incorporated into their end products and having a significant influence on their performance. In accordance with IFRS 7.3.6a, all amounts presented in the financial statements represent the maximum exposure to credit risk.

The Group grants its customers deferred payment conditions, which vary according to the market practices in individual countries. The solvency of all customers is monitored regularly and any risks are periodically covered by appropriate provisions. Despite these precautions, under current market conditions, it is possible that some customers may be unable to generate sufficient cash flow or access sufficient sources of funding, resulting in payment delays or failure to honour their obligations.

Receivables are adjusted to their estimated realisable value by the allowance for doubtful receivables, which is determined pursuant to IFRS 9 with reference to the expected credit losses on each position, taking account of past experience in each business area and geographical region.

The Group has developed estimates based on the best information available about past events, current economic conditions and forecasts for the future. With reference to the latter point, the Group has carried out analyses using a risk matrix that considers geographical region, business sector and individual customer solvency.

Management considers the forecasts generated to be reasonable and sustainable, despite the current climate of uncertainty.

causing the Company to miss opportunities and sacrifice market shares, consequently impacting on revenue generation. The impact of this risk would increase should one or more competitors propose business models or technologies that are more innovative than Gefran's.

In order to mitigate the impact of this risk, the Gefran Group has invested in software that introduces new production and process controls in the reorganisation of production flows, as well as in human resources, with the addition of specialised personnel focused on innovative technological trends.

GOVERNANCE AND 4INTEGRITY RISKS

Risks arising from ineffective Group coordination

The proper implementation of company strategies requires sufficient coordination between the Parent Company and the Group's subsidiaries.

To allow meetings to be held between teams from the various Group entities, with the aim of favouring the coordination and pursuit of corporate objectives and/or the implementation of specific projects, the Company promotes the use of hardware and software solutions for organising digital meetings and conferences, to mitigate the risk of slowing down the progress of joint projects. This coordination is mainly ensured thanks to the action of figures responsible for vertical markets and key account management, who pursue shared objectives and promote integration between the various Group entities.

Risks linked to dependence on certain unique or critical suppliers

The Group purchases raw materials and components from a large number of suppliers and, in some cases, depends on services and products supplied by other companies outside the Group. Electronic components, primarily microprocessors, power semi-conductors and memory chips, are purchased from leading global producers.

Dependence on some suppliers of technological components or platforms might result in delays in production in some particular periods due to lack of supply and/or extra costs due to the need to search for alternative components in the market, specifically components.

In fact, the electronic components market is marked by the saturation of production capacity, with the consequent need to use the production allocation process to assign the quantities of material available to its customers. Given the cyclical nature of this market, the few world players of active electronic components can suffer, in case of increased market demand.

As early as 2020, in response to the spread of Covid-19, the Group promptly set up a task force to identify, for suppliers defined as "critical", the location of their production facilities. The Group Purchasing function also took prompt action to research and qualify alternative suppliers to mitigate the risk of interruption of supply by reducing dependence on a single supplier wherever possible. This control remains in place should similar events arise again.

Some of the operating methods developed at the outset of the emergency turned out to be particularly effective including coping with the subsequent market shortage phase and have therefore been integrated into the Group's standard procedures, with the goal of mitigating, wherever possible, some of the risks associated with possible supply chain interruptions caused by events beyond the Group's control.

Lastly, it is confirmed that the Group does not have direct supply relationships in countries currently involved in the ongoing conflicts. In this regard, Gefran complies with the applicable regulatory requirements and restrictive measures established by the European Union and recommends that its suppliers comply with the same high standard.

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OPERATING RISKS AND REPORTING RISKS

Risks associated with product development, management and quality

The Group's value chain covers all activities, including R&D, production, marketing, sales and technical support, all the way down to technical support. Defects or errors in these processes may cause product quality problems that can potentially affect the Group's results and financial position.

The quality of the product and of the process underlying its creation is of the utmost importance for Gefran. This is evident from the organisation of the activities of the integrated Quality, Safety and Environment function, which has Group-wide responsibilities; over the years, the function has been endowed with new resources and skills to ensure the proper supervision of this fundamental aspect.

In line with the practices of many operators in the sector, Gefran has arranged insurance policies deemed sufficient to protect against product liability risks. Furthermore, a specific product warranty provision is envisaged to cover these risks, in line with the volume of business and the historical occurrence of claims.

Nevertheless, should the insurance cover and the risk provision prove inadequate, the Group's economic and financial position might be adversely affected. In addition, the Group's involvement in disputes concerning product quality and any adverse rulings might expose the Group to reputational damage, which might also indirectly affect its economic and financial position.

5

Risks associated with operations at industrial facilities

Gefran is an industrial group, so it is potentially exposed to the risk of production stoppages at one or more of its plants, due, for example, to machinery breakdowns, revocation or disputes regarding permits or licences from public authorities (e.g. following changes in the law), strikes or manpower unavailability, natural disasters, major disruptions to the supply of raw materials or energy, sabotage or attack.

There have not been any significant interruptions of activity in recent years, except for limited periods and in relation to the healthcare emergency linked to the ongoing Covid-19 pandemic; however, future interruptions cannot be ruled out, and if they occur for lengthy periods, the Group's economic and financial position might be adversely affected if the losses exceed the amount currently covered by insurance policies.

Gefran has implemented a disaster recovery system for restoring the systems, data and infrastructures necessary for the Group's work in the event of an emergency and to contain its impact.

Moreover, to mitigate this risk, Gefran has developed plans for investment in plant and machinery, aiming for the digitalisation of processes, the expansion and reorganisation of productive areas and the hiring of new employees. Additionally, the uniformity of production processes and use of the same bill of materials means, if required by external conditions, that production can be transferred to plants not specified in the standard operating processes.

However, possible major fluctuations in demand that prevent effective production planning, or demand in excess of productive capacity, might result in the loss of business opportunities or of even of revenues.

108 109

LEGAL AND COMPLIANCE 6 RISKS 7

Legal risks and product liability

In the context of the Group's core business, issues may arise linked to product defects and consequent civil liabilities towards customers or third parties. The Group is therefore exposed to the risk of product liability claims, provided for in the different countries in which it operates.

In line with the practices of many operators in the sector, Gefran has arranged insurance policies deemed sufficient to protect against product liability risks.

Nevertheless, should the insurance cover and risk provisions prove inadequate, the Group's economic and financial position might be adversely affected. In addition, the Group's involvement in legal disputes relating to product liability and any adverse rulings might expose Gefran to reputational damage, which might also affect its economic and financial position.

IT RISKS

Risks related to data security, IT systems and products with Information Technology/Operational Technology (Cybersecurity) functionalities

The digitisation of processes, the adoption of new technologies (e.g. artificial intelligence) and new methods of smart working, as well as the development of products with IT/OT functionalities, increase exposure to hacker attacks, which can cause business interruptions and loss of sensitive data with increasing costs. In view of the increasing phenomenon of so-called cyber crime and its constant evolution, the Group is exposed to IT attacks that might compromise corporate data published on the internet, its internal network or other company systems. Also with regard to products with functions that integrate digital functionalities, cyber crime phenomena may expose the Group and its customers to interruption in their operations, and possible damage to their trust relationships, as well as market competitiveness and regulatory non-compliance, giving rise to higher costs.

The risk is considered partially mitigated as the critical systems adopted by the various Group entities (SAP ERP, email, etc.) are installed and managed directly by the Parent Company from a central location, where a control plan and risk assessment have been defined.

Gefran has placed a strong focus on cybersecurity, adopting procedures and systems to monitor and prevent attacks on the corporate network by hackers, arranging specific insurance cover as well as launching special training and awareness-raising initiatives on IT security issues.

Gefran conducts analyses on product development processes, paying particular attention to identifying possible connections with cybersecurity issues, in order to prevent and mitigate any related risks.

Risks related to the protection of exclusivity and intellectual property rights

The Group believes that it has adopted an appropriate system to protect its intellectual property rights, though is exposed to the risk related to higher costs, related to any actions to be taken to defend those rights.

Furthermore, the intellectual property rights of third parties might inhibit or limit the Group's capacity to place new products on the market. These events might have an adverse impact on the development of the Group's business.

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Annual Financial Report at 31 december 2025 Gefran Group

8 9ESG RISKS RISKS ASSOCIATED WITH HUMAN RESOURCES

Difficulty in attraction and retention of personnel

Gefran is exposed to the tensions that are affecting the world of work concerning the attraction and retention of personnel with the necessary knowledge and critical skills in strategic areas for the Group (e.g. R&D and production engineering).

Gefran has implemented actions to increase its reputational value, including by engaging in projects aimed at creating a professional organisation to which it is desirable to belong. This goes beyond guaranteeing health and a safe working environment, but more generally concerns the quality of life inside and outside the company, the training and development of talents, promoting diversity as a value, as well as the strengthening of partnerships with universities, allowing the Group to increase its ability to attract and retain its personnel and to stand up to the fierce competition among market players in the recruitment phase.

Environmental damage risks

Although the Group's activities do not include the processing or treatment of materials or components to an extent representing a significant risk of pollution or, in any case, of environmental damage, the Group also pays special attention to environmental protection regulations.

Gefran has implemented a series of controls and monitoring to identify and prevent risks related to safety and environment, and has prepared and disseminated the "Health, Safety and Environment System" management policy at every level. As a guarantee of the appropriate management methods implemented, the Group's main Italian companies obtained ISO 14001:2015 Environmental Management System certification in 2023, which has now been extended to the Group's production foreign subsidiaries in China, the United States and Switzerland (third-party audits conducted in December 2025 and January 2026).

If potential liabilities deriving from environmental damage arise, the Group may have recourse on the insurance policies taken out to cover such effects.

Health and safety risks

Risk assessment is essential to protect the health and safety of our workers. Gefran is constantly committed to mapping the operating risks that might arise in the various business sectors, so as to define opportunities and take action to minimise these risks wherever possible.

Protecting health and safety is essential for Gefran. Confirming the importance of these issues, the organisation has established an integrated "Quality, Safety and Environment" function that still operates today, drawing on Group-wide expertise. The policy for the "Health, Safety and Environment System", which

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defines guiding principles in these areas, has also been signed and disseminated throughout the Group.

As a guarantee of the appropriate management methods implemented, the Group's Italian companies have obtained ISO 45001:2018 Occupational Health and Safety Management System certification, which has now been extended to the Group's production foreign subsidiaries in China, the United States and Switzerland (third-party audits conducted in December 2025 and January 2026).

Risk of non-compliance with adequate labour standards in the supply chain

Gefran purchases some raw materials and semi-finished products required for its production from suppliers outside the Group. For this reason, it is exposed to the risk that the same standards of compliance with the rights of workers guaranteed by the Group are not guaranteed in the supply chain and this risk is greater in some of the geographical regions in which the Group operates.

This might result in accidents leading to disruption of the supply chain and, therefore, impacts on business continuity, as well as possible impacts on its reputation.

To this end, Gefran has modified the accreditation process for new suppliers, requesting the signing of the Sustainability Pact, a document which requires compliance with certain sustainability principles (guarantee of a healthy and safe working environment, respect for human rights in working conditions and discrimination, fight against corruption, etc.). Today the Group is striving to extend its sustainability commitments to an ever larger share of its supply chain.

Ethical risks

The Gefran Group has always been committed to applying and observing rigorous ethical and moral principles when conducting its internal and external activities, in full compliance with the laws in force and market regulations. The adoption of the Code of Ethics and Conduct, updated by the Board of Directors at its 10 March 2022 meeting, the related internal compliance procedures put in place and the controls adopted guarantee a healthy, safe and efficient working environment for employees and an approach intended to ensure complete respect for external Stakeholders. The Group believes that ethics in business management must be pursued alongside financial growth, and the Code is therefore an explicit point of reference for everyone working with the Group.

On 10 March 2022, Gefran approved the "Policy for managing dialogue with shareholders and investors" (known as Engagement Code), in accordance with the Corporate Governance Code approved by the Italian Corporate Governance Committee. The adoption of this policy, aimed at regulating and promoting dialogue with shareholders and institutional analysts, is consistent with one of the principles that has always characterised the Company: encouraging honest dialogue with Stakeholders with a view to creating value in the medium to long term.

Respect for people and appreciation of their skills, protection of diversity and equal opportunities are the ethical principles inspiring the Group's HR Policy and expressed in the "People in Gefran" policy, which applies to the Group as a whole, and the "Sustainability Pact"

required of suppliers.

The Group has also effectively adopted an Organisational, Management and Control Model pursuant to Italian Legislative Decree no. 231/2001 (known as the Organisational Model). The Organisational Model, drawn up on the basis of the Confindustria Guidelines, is periodically updated in line with the evolution of the legislation. At least annually, Gefran carries out the updating of the risk assessment 231 activity, with the aim of evaluating changes in the Company's risk profile and of incorporating any organisational changes or the introduction of new "predicate offences" or changes thereto. This activity is carried out both through interviews with the functions involved and through document analysis.

The Group believes that this is not only a regulatory obligation, but also a source of growth and wealth generation and has therefore fully restructured its activities and internal procedures to prevent the offences set out in this regulation from being committed. The Supervisory

Body established by the Board of Directors performs its duties constantly and professionally, guaranteed by the presence of two professionals with excellent knowledge of administrative and process control systems.

It is stipulated that the Group conducts the bulk of its business with private customers, which do not directly or indirectly belong to government organisations or public agencies, and rarely takes part in public tenders or funded projects. This further limits the risks of reputational or economic damage resulting from unacceptable ethical conduct.

In this context, to ensure that appropriate management methods are implemented, an Integrated Management System has been implemented, certified according to the SA 8000:2014 Social Accountability standard, in the Group's Italian companies, and the process will be gradually extended to the Group's foreign production subsidiaries. The project to extend the integrated management system is continuing towards the main production branches abroad, based on the model developed on Italian companies.

REPORT ON OPERATIONS SUSTAINABILITY REPORT

Annual Financial Report at 31 december 2025 Gefran Group

INTRODUCTION TO GEFRAN GROUP'S SUSTAINABILITY REPORT

Please find in the paragraphs below the Sustainability Report of the Gefran Group, prepared in accordance with Directive 2022/2464/EU and pursuant to Italian Legislative Decree 125/2024.

1

Since the entry into force of the Corporate Sustainability Reporting Directive (CSRD), Gefran has been presenting information to its stakeholders on management and performance relating to environmental, social and governance issues in accordance with the new Directive, adopting the European Sustainability Reporting Standards (ESRS), which are the fundamental reference framework for the CSRD.

The CSRD represents the beginning of a new phase in sustainability reporting, increasing the emphasis on accountability, standardisation and transparency with which organisations report their ESG performance and impacts.

It should be noted that, for the reporting of material topics within the Sustainability Report, the Global Reporting Initiative (GRI) standards were adopted until fiscal year 2023.

In order to align with the new framework, concrete actions have been taken and significant efforts made to ensure compliance with the requirements, paying particular attention to the principle of double materiality, conducting an in-depth analysis to identify the most urgent and relevant ESG issues for both the Group and stakeholders.

While compliance with CSRD requirements is a regulatory necessity, the adoption of the new standard is seen as a significant opportunity to create value for all our stakeholders, enhance our reputation and consolidate our position as a responsible and forward-looking organisation. The new framework opens the way to address and overcome fundamental ESG challenges, acting as a compass, supporting the Group in assessing and mitigating negative impacts and risks, while strengthening its resilience and developing competitiveness in a rapidly changing global landscape.

We invite all stakeholders to explore the policies, actions, metrics and targets related to relevant sustainability issues, which are described in the Gefran Group Sustainability Report below.

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GENERAL 2 DISCLOSURES

ESRS 2 GENERAL DISCLOSURES

CRITERIA FOR PREPARATION

• BP1 General Criteria for preparing the
• Sustainability Report BP2 Disclosure in relation to specific circumstances

GROUP GOVERNANCE

GOV-1 Role of administrative, management and supervisory bodies

SUSTAINABILITY GOVERNANCE

• GOV-2 Information provided to the undertaking's administrative, management and supervisory bodies and sustainability issues addressed by them
• GOV-3 Integration of sustainabilityrelated performance in incentive schemes
• GOV-4 Statement on due diligence

INTEGRATED RISK MANAGEMENT

GOV-5 Risk management and internal controls over sustainability reporting

STRATEGY

• SBM-1 Strategy, business model and value chain
• SBM-2 Interests and views of stakeholders
• SBM-3 Material impacts, risks and opportunities and their interaction with our strategy and business model

IMPACT, RISK AND OPPORTUNITY MANAGEMENT – MATERIALITY ASSESSMENT PROCESS

• IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities
• IRO-2 Disclosure obligations of ESRS covered by the undertaking's Sustainability Statement

IMPACT, RISK AND OPPORTUNITY MANAGEMENT – POLICIES AND ACTIONS

• MDR-P Policies adopted to address material sustainability issues
• MDR-A Actions and resources in relation to material sustainability matters

METRICS AND TARGETS

• MDR-M Metrics in relation to material sustainability matters
• MDR-T Tracking effectiveness of policies and actions through targets

Annual Financial Report at 31 december 2025 Gefran Group

ESRS 2 GENERAL DISCLOSURE

Criteria for preparation

BP1 General Criteria for preparing the Sustainability Report

The Gefran Group Sustainability Report 2025 (hereinafter "Report"), prepared on a consolidated basis, includes information for the period from 1 January 2025 to 31 December 2025. It was prepared pursuant to Italian Legislative Decree 125/2024 of 6 September 2024, in accordance with the international reporting standards known as "European Sustainability Reporting Directive Standards" (ESRS) issued by EFRAG and adopted by the European Commission as Delegated Acts to Regulation 2023/2772 of 31 July 2023. When preparing this Report, changes in the regulations issued by the Commission in June 2025 (the so-called Quick Fix Package) were also adopted.

The scope of the Report is the same as that adopted for the preparation of the consolidated financial statements, as described in Note 2 of the Specific explanatory notes to the consolidated financial statements, and applies to all Group companies. It should also be noted that the scope of consolidation at 31 December 2025 differs from that at 31 December 2024, as illustrated in Note 5 of the Specific explanatory notes to the consolidated financial statements, to which reference is made.

In addition, in carrying out the double materiality assessment and for the purposes of the best representation of the Group to its Stakeholders, information is examined regarding the value chain, including the main upstream processes with respect to Gefran's own activities (typically represented by inflows from its suppliers) and downstream processes (characterised by outflows from the Group's plants to its customers, including, for certain aspects such as health and safety, the end-users of our products). Due to the incomplete visibility of all processes along the value chain, from the origin of resources to the final destination of the finished product as created and sold, the Report only analyses information relating to the direct flows of goods and services into and out of the Group (known as Tier 1). Lastly, Gefran did not use the option of omitting specific information corresponding to intellectual property, know-how or the results of innovation. (ESRS 2 – BP-1 5 a, b, c, d)

BP2 Disclosure in relation to specific circumstances

For the purposes of this Report:

TIME HORIZONS

In accordance with ESRS 1, we take into account the same time horizons adopted for the preparation of the consolidated financial statements: expected effects within the year are considered "short-term", while "medium-term" are those at 1 to 5 years and "long-term" are those beyond 5 years.

(ESRS 2 – BP-2 10,11)

(ESRS 2 – BP-2 9)

UNCERTAINTY IN ESTIMATES

Precise (quantitative and descriptive) information was collected from the various entities in the Group, subsequently aggregated and analysed at corporate level, as defined by the specific procedure approved by the Board of Directors in February 2025 and adopted by the Group.

In order to respond to information requests and simultaneously provide a representative view of the Group, estimates were made both in the analyses conducted for mapping the value chain and in the construction of some specific metrics. Specifically:

/ the metrics reported in the section Environmental information in paragraph E5-4 Resource inflows include the estimate of the weight of packaging and mechanical semi-finished products purchased by the Group;

/ the metrics reported in the section Environmental information in paragraph E5-5 Outflows, include the estimate of the weight of the waste produced by the newly acquired subsidiary CZ Elettronica S.r.l., for which it was not possible to collect specific data with metrics consistent with those of the Group, referred to the period April–December 2025;

/ the figure for Scope 3 GHG emissions set out in the section Environmental information in paragraph E1-6 Gross GHG emissions, calculated using the methods provided for in the GHG Protocol, presents inherent limitations due to the limited availability of precise information on quantitative and

• qualitative aspects of the value chain.

A full description of the estimates adopted is provided in the respective paragraphs of the disclosure.

CHANGES IN THE REPORT AND PRESENTATION OF SUSTAINABILITY INFORMATION

Please note that changes to the calculation methodology have been implemented for some indicators compared to those presented in the 2024 Sustainability Report. Specifically, the changes concerned the metrics reported in paragraphs S1-16 Remuneration Metrics and G1-6 Payment Practices. The full description is provided in the respective sections of the disclosure.

Additionally, for the metrics reported in paragraph S1-16, the values for the previous year are restated, as described in the notes included in the specific section.

INCLUSION BY REFERENCE

No reference to documents other than the Annual financial report is used. However, some of the information is included in the sustainability report by reference to other sections of this Sustainability Report or to paragraphs of the Report on Operations. Specifically, please refer to the paragraph Results by business area for a description of the strategy adopted by Gefran in its two significant sectors, Sensors and Automation components, including a description of targets, performances, context assessments and any elements related to sustainability issues.

(ESRS 2 – BP-2 17)

Group governance

GOV-1 Role of administrative, management and supervisory bodies

The governance system adopted by the Parent Company Gefran S.p.A. is made up of the Management Bodies represented and described below.

SUPERVISORV BOARD

INTERNAL AUDIT

(ESRS 2 – BP-2 16)

APPLICATION OF THE TRANSITIONAL PROVISIONS LAID DOWN IN APPENDIX C TO ESRS 1

Gefran conducted the double materiality assessment in accordance with ESRS standards (as described in the section General disclosures, paragraph Impact, Risk and Opportunity Management – Materiality Assessment Process, IRO-1) in order to identify the material topics included in this Report, assessing impacts (impact materiality) as well as risks and opportunities (financial materiality).

As required by ESRS 1 – Appendix C, when preparing the disclosure, the phase-in measures envisaged were assessed, also taking into account the legislative changes of June 2025 (the so-called Quick Fix Package). Please note that the average number of employees in the Gefran Group for 2025 is less than 750 (the average calculated from the monthly data is 741 employees); it should be noted that in this document:

• / the description of the expected financial effects (specifically ESRS 2 SMB-3, E1-9, E5-6) and of the biodiversity issue (E4), deemed not relevant, is omitted;
• / partial information is provided on social issues, with respect to ESRS S2 and S4 requirements.

Please refer to the section General disclosures, paragraph Strategy, SBM-3 of this Report for a description of material topics.

Annual Financial Report at 31 december 2025 Gefran Group

BOARD OF DIRECTORS

The Board of Directors, in office until approval of the annual financial statements for 2025, has 9 members, as resolved by the 21 April 2023 Ordinary Shareholders' Meeting, which appointed the members of the Company's management body.

Its members are experts in economic and financial matters and, in particular, the Sustainability Committee (which represents 33.3% of the Board) has specific sustainability expertise, also consolidated by its multi-year experience in managing ESG issues in the company. They also have many years of experience in industrial and technological sectors, as well as in the geographical regions in which the Group operates.

Pursuant to and for the purposes of principle XIV and recommendations 19 and 21 of the Corporate Governance Code, the outgoing Board of Directors formulated on 9 March 2023 a positive assessment of the size, composition and functioning of the Board and its Committees, as well as a positive assessment of the three-year mandate as a whole, following the responses to the self-assessment questionnaires completed by the Directors.

Pursuant to Article 19 of the Articles of Association, the Board of Directors is vested with the widest powers for the ordinary and extraordinary management of the Company, without limitation and therefore with the power to carry out all acts considered necessary to implement and achieve the corporate purpose, excluding only those strictly reserved by law to the Shareholders' Meeting. In particular, the Board is exclusively responsible for, among other things, examining and approving strategic, business and financial plans, and the Group's structure; the Board also oversees operating performance, and pays particular attention to possible conflicts of interest.

The Chairwoman of the Board of Directors is the Company's legal representative, pursuant to Article 21 of the Articles of Association. At its meeting of 21 April 2023, the Board of Directors granted powers of legal representation to the Chairwoman Maria Chiara Franceschetti and to the Chief Executive Officer Marcello Perini, while the Vice Chairwoman Giovanna Franceschetti was granted powers relating to specific areas. On 13 November 2025, the resignation of Andrea Franceschetti from the position of Vice-Chairman and Chief Executive Officer was implemented with immediate effect; he retains the role of non-executive and non-independent director.

The independence requirements of the Board of Directors are checked annually. As of the date of this Report, Cristina Mollis (Lead Independent Director), Alessandra Maraffini, Enrico Zampedri and Giorgio Metta, all non-executive Directors, representing 44.4% of all the members of the management body, meet these requirements. Director Luigi Franceschetti is a non-executive non-independent Director. Executive Directors are Maria Chiara Franceschetti, Giovanna Franceschetti and Marcello Perini, the latter included in the Group's workforce.

The Board of Directors met 8 times in 2025.

Members of the Management Body are periodically involved in training sessions on specific issues which are strategic for the Group. For example, as a result of regulatory developments in sustainability, training workshops have been held with the aim of raising awareness of the requirements of the CSRD and of Italian Legislative Decree 125/2024, as amended. In addition to and with reference to the enactment of the NIS2 (Network and Information Security 2) Directive and the related Italian Legislative Decree 138/2024, in the fourth quarter of 2025 the Group's Directors were trained on cybersecurity issues and on the requirements of the relevant regulations.

To manage the various issues effectively, the following Committees have been established within the Board of Directors:

/ Control and Risks Committee

It is tasked with supporting, by conducting the appropriate preliminary work, the assessments and decisions of the Board of Directors in relation to the internal control and risk management system, as well as those relating to the approval of interim and annual financial reports.

It is made up of 3 non-executive directors, appointed by the Board of Directors at its meeting of 21 April 2023. The Committee met 6 times in 2025.

Executive between female and male members, is 0.8.

Non-executive Gender diversity within the Board of Directors, calculated as the average ratio

Annual Financial Report at 31 december 2025 Gefran Group

/ Appointments and Remuneration Committee

The Committee submits proposals or expresses opinions to the Board of Directors on the remuneration of executive directors, other directors with special duties and executives with strategic responsibility and sets performance objectives associated with the variable component of their remuneration; it also monitors the application of the decisions adopted by the Board, checking in particular that the performance objectives are actually achieved.

In addition, it expresses its opinion to the Board of Directors regarding the size and composition of the Board, and makes recommendations regarding the professional figures whose presence is deemed appropriate in the Board.

It is made up of 3 non-executive directors, appointed by the Board of Directors at its meeting of 21 April 2023. The Committee met 2 times in 2025.

/ Sustainability Committee

It is responsible for supervising all the Group's sustainability activities and reporting on its progress to the Board of Directors. It takes care of examining, on behalf of the Board of Directors, the general structure of the Sustainability Report and its contents, as well as the completeness and transparency of the information provided to Stakeholders with the Report itself.

It is made up of 3 directors, of whom 2 non-executive, appointed by the Board of Directors at its meeting of 21 April 2023. The Committee met 2 times in 2025.

Pursuant to Article 23 of the Articles of Association, the Board of Statutory Auditors comprises 5 non-executive members, of whom 3 are standing auditors and 2 are deputy auditors. Their office lasts 3 years and they may be re-elected. The current Board of Statutory Auditors was appointed by the Shareholders' Meeting of 23 April 2024 and will perform its duties until the approval of the 2026 annual financial statements.

It supervises compliance with the law and the deed of incorporation, good governance of the Company and the adequacy of its internal control system. It attends meetings of the Board of Directors and Shareholders' Meetings of the Company.

Its current members are professionals registered with the relevant professional body (Chartered Accountants and Auditors), with many years' experience, holding the same position also in other companies in the industrial or other sectors. Like the members of the Board of Directors, they are also involved in training sessions, particularly on the CSRD, and the majority of them have carried out the specific ESG training programme provided by the National Council of Chartered Accountants.

Gender diversity within the Board of Statutory Auditors, calculated as the average ratio between male and female members (with reference only to standing members), is 0.5.

The Board of Statutory Auditors met 11 times in 2025.

Gefran's administrative, management and supervisory bodies described above do not currently include employee representatives directly elected by the workforce or appointed by employee representation bodies. It should be noted that the governance structure adopted by the Group follows the traditional Italian model, which does not provide for such representation.

(ESRS 2 – GOV-1 21 a, b, c, d, 22 a, b, 23)

MANAGEMENT AND COORDINATION ACTIVITIES

Gefran S.p.A. is not subject to management and coordination pursuant to Article 2497 et seq. of the Italian Civil Code, since the following indicators that the Company may be subject to the management and control of another company are inapplicable:

/ preparation of Group-wide industrial, strategic, financial and budget plans

/ centralisation of functions such as treasury, administration, finance and

• by the parent company;
• / the issuing of directives pertaining to finance and credit policy;
• control;
• Company management.

/ the defining of Group growth strategies, the strategic and market positioning of the Group and individual companies, especially if the policy guidelines are likely to influence and determine their actual implementation by

The Parent Company Gefran S.p.A. provides coordination functions in the operational activities of business lines and subsidiaries. This responsibility lies with the HQ team, composed of the managers of each company department (C-level).

For a description of the role of management in the governance processes, controls and procedures used to monitor, manage and control impacts, risks and opportunities, please refer to the section General disclosures, Impact, Risk and Opportunity Management IRO-1 and IRO-2 of the Sustainability Report, as well as to the section Main risks and uncertainties to which the Gefran Group is exposed of this Report on Operations.

As provided for in Italian Legislative Decree 231/2001, the Board of Directors appointed the Supervisory Body (SB), composed of two members (Monica Vecchiati, Chairwoman, and Vittorio Grasso, internal member), providing it with regulations and the appropriate means to operate. The Supervisory Body monitors the implementation and correct application of the Model and may avail itself of external collaborations, risk assessment and audit activities.

PierMario Barzaghi, an external and independent person, is responsible for Internal Audit. The appointment was approved by the Board of Directors on 14 February 2024, following a favourable opinion from the Control and Risks Committee and having consulted the Board of Statutory Auditors. The company in charge of Internal Audit in the year that has just ended was KPMG Advisory S.p.A. and had the task of assessing - both continuously and in response to specific requirements, and in compliance with international standards - the operations and suitability of the internal control and risk management system through an audit plan approved by the Board of Directors and based on a structured process of analysis of the principal risk factors.

On 4 August 2022, following a favourable opinion of the Board of Statutory Auditors, the Board of Directors appointed Paolo Beccaria as Chief Financial Officer of the Group and, therefore, Executive in charge of financial reporting of Gefran S.p.A. He oversees direct supervision of the control model pursuant to Italian Law 262/2005 and the related administrative and accounting procedures. On 13 February 2025, the Board of Directors supplemented the powers of the Executive in charge of financial reporting to include responsibility for internal certification relating to the Sustainability Report pursuant to Italian Legislative Decree 125/2024.

As described in the section General disclosures – GOV-2 Sustainability Governance, sustainability performance and the level of achievement of defined objectives are verified by monitoring the progress (at least annually) of the various qualitative and quantitative indicators (KPIs), which is reported to the Committee at regular meetings during which the progress of the various projects is illustrated.

Sustainability governance

GOV-2 Information provided to the undertaking's administrative, management and supervisory bodies and sustainability issues addressed by them

In order to achieve the sustainability targets set by the Group, it was essential to structure governance on ESG issues, with a clear allocation of roles and duties.

The topics in question are brought to the attention of the Board of Directors through the activity of the Sustainability Committee (hereinafter the "Committee"), the composition and tasks of which are defined in specific Regulations, updated by the Board of Directors on 13 February 2025. The Committee meets whenever deemed necessary or appropriate in relation to its duties and for the proper performance of its functions (at least every six months). It is responsible for supervising all the Group's sustainability activities and reporting on their progress to the Management Body, as well as for monitoring regulatory developments. The Committee also oversees the activities leading up to the definition of the Group's sustainability strategy, participates in the definition of sustainability targets (including the analysis of impacts, risks and opportunities), guiding and expressing its opinion on the proposals made.

The Board of Statutory Auditors participates in Committee meetings and performs its supervisory activity, attending also the meetings of the Board of Directors and Shareholders' Meetings of the Company.

To carry out its duties, the Committee relies on a Sustainability Working Group (hereinafter "Working Group"). The team, in addition to the Sustainability Manager and the Chief Financial Officer, involves representatives of the main company departments to achieve a comprehensive and organic view of sustainability issues. Those responsible for the Procurement, Operations, People&Organization (P&O), Quality-Heath&Safety&Environment (QHSE), Legal functions and representatives of the Sales function are part of it. The Working Group, in close cooperation with the contact persons in all Group subsidiaries, was responsible for carrying out all preparatory activities for the definition of Gefran's sustainability strategy and its effective implementation. Sustainability performance and the level of achievement of defined objectives are verified by monitoring the progress (at least annually) of the various qualitative and quantitative indicators (KPIs), which is reported to the Committee at regular meetings during which the progress of the various projects is illustrated.

(ESRS 2 – GOV-1 22 c, d)

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The information available and the documents relating to matters discussed at meetings are sent to all Committee members sufficiently in advance of the meeting to enable them to express their views. Depending on the topics on the agenda, members of the Working Group, as well as the Sustainability Manager, the Chief Financial Officer and, in order to address more technical issues, expert advisors are also invited to attend the work sessions.

With regard to the preparation of the consolidated sustainability report of the Gefran Group, the process is carried out in accordance with the specific Procedure (approved by the Board of Directors on 13 February 2025) distributed to all parties involved. The Management Body is responsible for developing and implementing the procedures put in place to identify material topics (described in the section General disclosures – Strategy, SBM-3 of this Report, to which reference is made) and the information included in the Sustainability Report, as well as for identifying the internal persons responsible for certifying that the information included is in accordance with the reference standards.

In this context, the Sustainability Committee is also responsible for examining, on behalf of the Board of Directors, the general structure of the Sustainability Report and its contents, as well as the completeness and transparency of the information provided to Stakeholders. Specifically, the Committee takes part in the double materiality assessment of Gefran's impacts, risks and opportunities, carried out in accordance with the ESRS principles, as described in the section General disclosures - Impact, Risk and Opportunity Management – IRO-1 of this Report. (ESRS 2 – GOV-2 26)

GOV-3 Integration of sustainability-related performance in incentive schemes

The Company's Remuneration Policy is defined annually, as described in the Report on Remuneration Policy and Compensation Paid of Gefran S.p.A. published on the Company's website (www.gefran.com) in the section Investor/Governance/Shareholders' meetings (at https://www.gefran. com/governance/shareholders-meetings/). The process involves the Shareholders' Meeting, the Board of Directors, the Appointments and Remuneration Committee and the Board of Statutory Auditors, who are responsible, each for their functions, for the proper implementation of the Policy and ensure that the Policy is duly implemented.

The aim of the Policy is to hire, encourage and reward individuals who make use of their experience and expertise at the service of the Gefran Group, so become participants in its development, while maintaining the correct alignment between incentives and the risk profile of the activity in question.

The remuneration system adopted represents one of the essential tools for attracting, motivating and retaining competent people who can contribute to the Group's performance, while upholding Gefran's strategy, purpose, promise and guiding principles in view of the fact that the company's size and the size of the remuneration package are closely linked. With this in mind, the remuneration policy gives priority to the Company's best practices and to the Group's sustainability strategy over the remuneration policies of other companies or external benchmarks, which are also assessed and taken into consideration. In particular, some of the targets contained in the Sustainability Strategic Plan are connected with the variable remuneration of the Chief Executive Officer and of the Managers responsible for the actions identified in the plan. The Company has identified some parameters related to ESG (environmental, social and governance) issues by including these objectives among the qualitative objectives assigned to the beneficiaries of the plans.

For a complete description of the incentive systems and integration of sustainability performance, please refer to the paragraph E1 Governance GOV-3 in the section Environmental information of this Report. (ESRS 2 – GOV-3 29)

Annual Financial Report at 31 december 2025 Gefran Group

GOV-4 Statement on due diligence

The due diligence process, although not formalised through a specific procedure, is addressed through several structured processes relating to the different company activities. As an example, reference is made to the processes for managing:

• / Double Materiality Assessment
• / Enterprise Risk Management;
• / Supplier Evaluation and Qualification, including the accreditation process and the audit plan;
• / Integrated Management System procedures (in accordance with ISO 9001, 14001, 45001 and SA8000 standards);
• / Organisational and Management Procedures (pursuant to Italian Legislative Decree 231/2001);
• / all company Policies intended to identify, prevent, mitigate and report on how potential negative impacts and risks are addressed.

The due diligence process as a whole is analytical and based on sharing information and on transparency, in which attention, listening and dialogue are crucial.

With reference to the United Nations Guiding Principles on Business and Human Rights and to the OECD guidelines, the following are the due diligence elements applied:

Key elements of due diligence	Sustainability Report Section
Integrating due diligence into corporate governance,strategy and model	General disclosure ESRS 2 GOV-1, GOV-2, GOV-3, GOV-5General disclosures ESRS 2 SBM-1, SBM-3General disclosures ESRS 2 IRO-1
Engaging with affected stakeholders in all key steps ofthe due diligence	General disclosures ESRS 2 SBM-2General disclosures ESRS 2 IRO-1Social information S1-2
Identifying and assessing positive impacts	General disclosures ESRS 2 IRO-1
Taking action to address negative impacts	Environmental information E1-3, E1-4, E5-2, E5-3Social information S1-3, S1-4, S1-5Governance information G1-2, G1-3
Tracking the effectiveness of efforts and communicating	Environmental information E1-6, E5-5Social information S1-6, S1-7, S1-8, S1-9, S1-10, S1-11,S1-12, S1-13, S1-14, S1-15, S1-16, S1-17Governance Information G1-6

(ESRS 2 – GOV-4 32)

Integrated risk management

GOV-5 Risk management and internal controls over sustainability reporting

Gefran adopts a process aimed at periodically identifying, evaluating, managing and monitoring the main risk factors. This activity allows for identifying situations that might jeopardise the achievement of strategic objectives and for taking the appropriate decisions, aimed at mitigating risk exposure. The implemented Enterprise Risk Management (ERM) system is integrated into the corporate processes, organisational structures and systems that help to achieve the Group's strategic objectives, including ESG-related risks in the Risk Model among the potentially impacting risks, which are subsequently assessed.

With regard to the preparation of the consolidated sustainability report of the Gefran Group and the related controls, the process is carried out in accordance with the specific Procedure approved by the Board of Directors on 13 February 2025 and distributed to all parties involved. The Management Body is responsible for developing and implementing the procedures put in place to identify material topics (described in the section General disclosures – Strategy, SBM-3 of this Report, to which reference is made) and the information included in the Sustainability Report, as well as for identifying the internal persons responsible for certifying that the information included is in accordance with the reference standards.

In this context, the Sustainability Committee is also responsible for examining, on behalf of the Board of Directors, the general structure of the Sustainability Report and its contents, as well as the completeness and transparency of the information provided to Stakeholders.

All actors in the Group's Sustainability Governance participate in the process. The Working Group, liaising with Gefran's multi-level management (C-level and main reporting parties), actively participates in the system for identifying, assessing and managing potential risks, through the typical Enterprise Risk Management and double materiality assessment processes. The entire process is overseen by the Sustainability Committee on behalf of the Board of Directors. (ESRS 2 – GOV-5 36)

Annual Financial Report at 31 december 2025 Gefran Group

Strategy

SBM-1 Strategy, business model and value chain

The Gefran Group's business is currently centred around two main business areas: industrial sensors and automation components. To guarantee total control of the supply chain, design, production and commercialization activities are carried out for each business line through various sales channels, offering a complete range of products and solutions that can be applied in multiple automation sectors.

About 68% of revenues are generated abroad. Development abroad is driven by the need to monitor markets and be close to customers, a key factor in offering a comprehensive, high-quality service. Supporting customers, knowing their needs and satisfying them in a timely manner ensures the Group is highly competitive. This is further strengthened by the study of specific applications, local technical support, compliance with delivery times and aftersales service. Gefran does not currently have any specific targets in terms of customer categories or geographical regions, as described in the paragraph Results by business area of the Report on Operations.

The Gefran Group comprises the Parent Company Gefran S.p.A., based in Provaglio di Iseo (BS), Italy, and 13 companies, over which operational and financial control is exercised, of which 3 are located in northern Italy, 5 in Europe, 3 in Asia and 2 in the Americas.

production plants

sensors factories 4

automation components factories 2

electric panels factories 3

commercial sales organisation

in Europe 9

in Asia 3

in Latin America 1

in US 1

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Production processes are mainly mechanical, electronic and assembly-related in nature, concentrated in various sites in Italy, Switzerland, the United States and China. The company also has some assembly lines in Brazil to serve the local automation market, which use semi-finished products made in Italy.

Research and development, considered strategic to maintain high technological and innovative levels in products and ensure the competitiveness required by the market, is concentrated mainly in Italy and managed by the technical area of Gefran S.p.A. The work carried out at the laboratories of the Group's historical offices in Provaglio d'Iseo (BS) is now supported by the technological hub dedicated to force and deformation sensors in the Swiss subsidiary Gefran Schweiz AG. R&D includes

development of new technologies, evolution of the characteristics of existing products, product certification in addition to the design of custom products at the request of specific customers.

For further details on the strategy adopted by Gefran in its two significant sectors, Sensors and Automation components, including a description of targets, performances, context assessments and elements related to sustainability issues, please refer to the paragraph Results by business area of the Report on Operations.

Gefran operates directly in 11 countries, with 748 employees (on 31 December 2025), grouped into 4 main geographical regions.

It distributes its products through its sales network in about 70 countries. Revenues earned in 2025, totalling 138,964 thousand Euro, are geographically broken down as follows:

For details regarding the revenues generated for the Group's significant sectors, in this case Sensors and Automation components, please refer to the sector information discussed in the paragraph Results by business area of the Report on Operations, where further information on significant events and strategy is also provided. (ESRS 2 – SBM-1 40 a, e, f, g)

CONSOLIDATED FINANCIAL STATEMENTS

138 139

Value chain

When assessing significant Impacts, Risks and Opportunities and defining the contents of the Sustainability Report, Gefran carried out an analysis aimed at understanding the most characteristic aspects of its value chain, based on the mapping of the Group's main activities, the type of products produced and its upstream and downstream processes.

DOWNSTREAM PROCESSES

Gefran's downstream value chain includes customers of various kinds (manufacturers, system integrators and end users) as well as distributors to which Gefran directly supplies its product, which is integrated into manufacturing processes in various application sectors, representing a component of the plant and becoming an integral part of the operations of end users.

Main industries

Expertise, flexibility, and process quality are Gefran's distinguishing factors in the design and manufacture of sensors, systems, and components for industrial automation. Thanks to its consolidated know-how, the company develops tailor-made solutions for specific applications in various sectors, with particular expertise in the plastics, mobile machinery, and metal industries.

Plastics Mobile machines Metal

An analysis conducted in June 2025 with the aid of business intelligence and CRM systems shows that approximately 80% of the revenues generated by the Group are intended for 5 main primary markets: Plastics & Chemicals (accounting for 48%), Distribution (20%), Mobile Machinery (8%) and Metal & Glass (including Heat Treatment, accounting for 5% overall) and Food & Medical (accounting for 5% overall).

One of the downstream processes mapped by the Group is the transport of finished products from production plants to customers' warehouses. Wherever possible, the direct management of shipments is preferred, from the Group's production sites to the warehouses of end customers (so-called triangulation), over the transit of goods through the warehouses of the Group's commercial branches. Gefran makes use of third-party transport services, which can be carried out by road (mainly) or by air and sea, depending on various factors such as urgency and/or the carbon footprint impact.

Gefran operates in markets that are highly competitive in terms of product quality, innovation, price competitiveness, reliability and support levels. Agreements are normally long-term, because Gefran products form an integral part of the customer's product design, being incorporated into their end products and having a significant influence on their performance during use. The Group does business with a large number of customers (business-to-business) and customer concentration is not considered high (no customer has a more than 5% percentage weight on total revenues).

CONSOLIDATED FINANCIAL STATEMENTS

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UPSTREAM PROCESSES

The upstream value chain includes suppliers from which Gefran procures products directly, which are included among the Group's strategic Stakeholders. The supply chain is an essential element to ensure the highest quality standards and to achieve economic and ESG performance targets. Some suppliers, owing to their skills and know-how, are involved right from the development phase of new Gefran products in jointly designing components and specific or custom parts.

The market in which Gefran operates is characterised by variable demand, very fast delivery times and most production is classed as High mix-Low volume (many finished product codes in the catalogue, each with non-high recurring production volumes). There ensues the need for a short supply chain, able to act quickly and flexibly. For this reason, local suppliers are involved in drawing up procurement plans to respond to rapidly changing demand.

The supply chain is made up of: suppliers of materials used in bills of materials (electronic, mechanical and electromechanical components) and of indirect materials, providers of services and assets. The base consists of both large multinational groups and local companies (active in the country where the Gefran plant that is supplied is based and, in many cases, of small/medium size), with specific know-how and flexibility characteristics.

The electronic components market is marked by the saturation of production capacity, with the consequent need to use the production allocation process to assign the quantities of material available to its customers. By its cyclical nature, the few world players of active electronic components can suffer, in case of increased market demand. Dependence on some suppliers of technological components or platforms might result in slow-downs in production in some particular periods due to late supplies and/or extra costs due to the need to search for alternative components in the market, specifically components. To date, this phenomenon has not had a significant impact on the Group, thanks to the policies implemented in supply management.

Gefran has carried out and maintains a mapping for the identification of suppliers defined as "critical" and the location of their production plants, in order to act promptly in the search for and qualification of alternative suppliers, reducing dependence on a single supplier wherever possible and mitigating the possible risk of interruption in supply.

To date, a permanent and structured system for monitoring the risk of supply on components as well as a system for periodic risk assessment on the main suppliers have also been implemented.

With regard to procurement expenditure**2** , accurate data was collected in the Group's production entities and in some branches that purchase and resell products manufactured by third parties. In 2025 the total procurement expenditure totalled 66,508 thousand Euro (61,846 thousand Euro in 2024), with an incidence of local supply of 87.8% on total purchases (87.7% incidence also in 2024). For the remaining sales companies, the analysis was conducted in a marginal way, as 89.1% of their procurement comes from intercompany purchases and only the remaining part from local supplies**3**.

The analysis of procurement flows shows that supplies are split into direct materials used for production (61.1%), services and indirect materials (28.9%) and durable goods (10%). As regards the geographical distribution of supplies, most suppliers are based in Europe (overall 88.4% of the total, of which 76.2% in Italy, 10.4% in EU countries and 1.8% in non-EU Europe).

Lastly, it is confirmed that the Group does not have direct supply relationships in the countries currently involved in the ongoing wars (Russian-Ukraine and Middle East conflicts). In this regard, Gefran complies with the applicable regulatory requirements and restrictive measures established by the European Union and recommends that its suppliers comply with the same

high standard.

other indirect emissions of CO2e (known as Scope 3). is located.

2 Procurement expenditure represents the total value of invoices for the purchase of goods, services and durable goods from third-party suppliers. The analysis of procurement flows is carried out as part of the assessment of

3 Local supply means a supply flow from suppliers based in the country where the Gefran plant being supplied

(ESRS 2 – SBM-1 42)

SBM-2 Interests and views of stakeholders

Gefran constantly strives to develop relationships of trust with its Stakeholders. These include individuals, groups or institutions that directly or indirectly contribute to the Group's sustainable success or those who have an interest therein.

Keeping and stimulating an open regular dialogue with stakeholders allows for better identification of risks, present and future challenges and opportunities for creating social, environmental or economic value over the medium to long term.

Gefran systematically involves Stakeholders and the main players in the value chain, through various engagement methods that are functional to the preliminary analyses needed to define its sustainability strategy. Engaging individuals and selecting the most representative from the various categories takes place through dedicated events (such as the Supplier Day) or through direct contact by the relevant company department (one-to-one meetings or webinars).

The indications deriving from engagement and dialogue activities with stakeholders, as well as the assessments collected about specific ESG aspects (for example, through questionnaires on the relevance of impacts, risks and opportunities), are reported to the Working Group and the Sustainability Committee. Their sharing, which takes place according to the usual organisational methods adopted within the Group (dedicated meetings, workshops and formal meetings) is aimed at verifying the alignment of the sustainability strategy.

If a mismatch is found between Stakeholders' expectations and the planned strategy, analyses are launched to determine whether the objectives should be reviewed or whether new actions to be implemented should be identified. These activities involve managers of the company departments affected by the relevant issues and can also include trend and benchmark analyses. The possible review of the objectives set out in the Group's Strategic Sustainability Plan is submitted to the Sustainability Committee, which provides the appropriate guidelines for its subsequent implementation.

There are many ways of engaging Stakeholders, which the Group manages functionally according to the targets and the specific characteristics of different Stakeholder categories. In addition to the usual informational media channels (website, trade publications and social media), the table below outlines the main engagement methods used.

Gefran Group

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Stakeholder	(User&Affected) Methods of engagement and dialogue	Group objectives	Reference function implementing dialogue
Employees	/ Intranet channel, for the dissemination of Policies, Useful Documentation, Internal proceduresand Integrated Management System Manual/ Publication on Gefran News of ongoing initiatives and news from the various companies withinthe Group/ KenFLY, the digital hub of the Gefran Talent Academy, dedicated to training (including theSustainability Hub)) and to the mutual sharing of experiences/ Internal events dedicated to employees, both on-site and via digital channels/ Open Days for employees' families/ Wellfran, the thematic corporate welfare programme portal/ Negotiating tables with trade unions	/ Promote workplace well-being/ Stimulate personal growth to strengthen people's contribution to achieving corporate goals/ Mitigate the attraction/retention risk, thus the risk oflosing opportunities and competitiveness	/ People&Organization/ Q-HSE/ Sustainability
Suppliers	/ Industry meetings/ Trade fairs/ Dedicated events such as the Supplier Day/ Accreditation process via eProcurement platform, including a self-evaluation assessment/ Request for documents, regulatory compliance, certifications, policies and other documentation useful for assessment/ Investigations/surveys (mutual) on specific topics/ Audits carried out according to the defined plan	/ Keep product quality standards/ Ensure ethical and transparent ways of working/ Share and actively involve suppliers in achieving presetobjectives	/ Purchasing/ Sustainability/ Q-HSE
Customers	/ Industry meetings/ Trade fairs/ Dedicated events and workshops (also when new products are launched)/ Training/ Visits to company sites/ Audits of our processes/plants/ Completion of questionnaires and sharing of ESG scores	/ Detect customer trends and expectations in order totransform them into competitive levers/ Offer products and services that can ensure efficiencyto users	/ Sales/ Sustainability/ Q-HSE
Localcommunities	/ Meetings with local institutions and associations/ Participation in guidance and engagement activities for local high school and universitystudents/ Participation in initiatives promoted by local associations	/ Promote the sustainable development of the territory / People&Organization	/ Communication
Shareholders	/ Engagement Code/ Shareholders' Meeting/ Publication of corporate documentation (Corporate Governance Report, Financial Reports andperiodic presentations, …)/ Mailing lists/ Regular meetings with top management and the Investor Relations function	/ Communicate the Group's performance and objectivestransparently	/ Investor Relations/ CEO/ CFO

/ Stimulate personal growth to strengthen people's con-/ Mitigate the attraction/retention risk, thus the risk of / People&Organization / Q-HSE / Sustainability / Ensure ethical and transparent ways of working / Share and actively involve suppliers in achieving preset / Purchasing / Sustainability / Q-HSE / Detect customer trends and expectations in order to / Offer products and services that can ensure efficiency / Sales / Sustainability / Q-HSE / Promote the sustainable development of the territory / People&Organization / Communication / Communicate the Group's performance and objectives / Investor Relations / CEO / CFO

Stakeholder(User)	Methods of engagement and dialogue	Group objectives	Reference function implementing dialogue
	/ Collaboration projects	/ Strengthen technical partnerships to generate	/ Innovation
Training andresearch bodies	/ PhD programmes	innovation	/ R&D
	/ Work at universities
	/ Specific meetings	/ Act in accordance with applicable laws	/ Legal
Institutions	/ Discussion tables and dialogue with the Public Administration		/ CEO
	/ Institutional communication		/ Chair's Office

(ESRS 2 – SBM-2 4 5 a)

It should also be noted that, as described in the section General disclosures - Impact, Risk and Opportunity Management – Materiality Assessment Process, IRO-1 of this Report, in the course of the Double Materiality Assessment, representatives of the categories of stakeholders closest to the issues affected by such Impacts, as well as by the Risks and Opportunities regarded as potentially significant for the Group, were involved.

Gefran organises opportunities for internal and external Stakeholder engagement - using various methods of engagement that are specific to each category of stakeholders - which also include the sharing of training material in order to increase knowledge of ESG aspects and generate greater awareness in identifying and assessing the relevance of the IROs identified.

The impact materiality assessment typically involves a select panel of employees, customers, suppliers and research institutes with which Gefran collaborates, as well as the Group's internal Management and Governance. Conversely, the assessment of risks and opportunities (financial materiality), by its nature, only involves internal Management and Group Governance. The findings are discussed at Sustainability Committee meetings, where they are submitted for the opinion of its members, and are then presented to the Board of Directors. (ESRS 2 – SBM-2 45 a iv, a v, b, d)

SBM-3 Material impacts, risks and opportunities and their interaction with our strategy and business model

The Impacts, Risks and Opportunities related to the various topics are shown below, as deriving from the double materiality assessment in accordance with the requirements of the Corporate Sustainability Reporting Directive and the European Sustainability Reporting Standards that guide its application. It should be noted that the Gefran Group has renewed its double materiality assessment (DMA), in order to align with the requirements of the CSRD, carrying out internal and external Stakeholder engagement activities as described in the paragraph IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities.

The validity of the current analysis is periodically assessed in case of any changes within the organisation, in the external context or in the value chain which may affect the double materiality assessment, at least once a year. If necessary, it is then updated with reference to the entire process or only parts thereof, in order to reflect significant changes that may have taken place.

The information collected during 2025 gave evidence of no further elements leading to the identification of Impacts, Risks and Opportunities beyond those identified in the double materiality assessment conducted in 2024, which underpins the Sustainability Report. As part of the DMA assessment for 2025, the following analyses were also carried out:

/ Analysis of the regulatory environment: changes in the sustainability reporting regulations applicable to the 2025 report (Quick Fix, Taxonomy) and, in general, on ESG issues were taken into account;

/ Analysis of the organisational structure and the value chain: the dynamics observed in 2025 (e.g. the entry into the Group of CZ Elettronica S.r.l.) do not have a significant effect on the Group's organisational structure and the characteristics of its value chain, compared with what has already been analysed;

/ Considerations on the validity of the general structure of the double materiality assessment: the validity of the process carried out during 2024 through different stages (e.g. induction, workshop and stakeholder engagement) is confirmed.

In light of these considerations, the Sustainability Committee conducted an internal review of the previously identified Impacts, Risks and Opportunities in order to strengthen their connection with the sub-topics defined by the ESRS, and to define the reference DMA for the fiscal year 2025. This led to some substantial changes to the DMA compared with the previous version, including:

/ ESRS S3 Affected communities: the impacts and opportunities identified, assessed as material in DMA 2024, were found in the review to be unrelated to the sub-topics and sub-sub-topics defined by ESRS 1 AR16, or not sufficiently material to identify an entity-specific topic, being referred to local associations, technical consortia and training centres, rather than indigenous communities; the topic is therefore excluded from the DMA for fiscal year 2025;

/ Entity specific: for the sake of greater completeness, an opportunity was identified associated with the typical nature of some Gefran processes in the field of innovation, concerning the digitalisation and optimisation of internal processes in order to generate efficiency and optimise management costs; digitalisation and optimisation of processes are priority topics for the Group, addressed through specific projects (e.g. Smart Logistic, Smart Manufacturing, Paperless Manufacturing), through the continuous improvement of processes, also supported by constantly developing information systems (e.g. SAP S/4Hana) and technological product innovation, which is aimed at developing solutions capable of improving energy performance, compliant with Industry 4.0/5.0; these topics are widespread in the corporate culture and approach of Gefran (Gefran Way), inherent in its operations, becoming an integral part of the way in which the Group's activities are managed and can be hardly separated and limited to a material topic specifically in the area of sustainability; the Committee has thus excluded from DMA 2025 the entity-specific topic that was previously considered material.

In addition, with a view to greater transparency and understanding, the connection of some IROs to the sub-topics and sub-sub-topics of the ESRS was updated, and the definitions of Risks and Opportunities were reformulated in order to better highlight the conditions or events that may cause them, without altering their substantive nature.

The IROs assessed as material for the Group and for the fiscal year 2025 are shown below.

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ESRS E1 Climate change

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
CLIMATE CHANGEADAPTATION			The inadequacy of the Business Continuity Plan, including inthe event of catastrophic natural events related to climatechange, can cause inefficiency and the risk of interruptionsand loss of revenues
CLIMATE CHANGEMITIGATION	The consumption of energy from fossil sources(non-renewable) connected with the activitiescarried out by Gefran and/or its supply chainhas an impact, contributing to climate changethrough the production and release into theatmosphere of GHG emissions (including CO2e)
ENERGY		Energy efficiency generated by the use of Gefranproducts allows for less consumption of resources,with a smaller impact on the environment

Energy efficiency generated by the use of Gefran products is a factor that increases their attractiveness on the market, representing an opportunity to increase Gefran's competitiveness

Energy efficiency of plants and processes, generated by the Group's planned investments, represents an opportunity to reduce energy costs

Annual Financial Report at 31 december 2025 Gefran Group

ESRS E5 Circular economy and resource use

The development and offer of products, which provide users with predictive analysis, efficient use of resources and the possibility of planning maintenance in order to prevent breakdowns and downtime, as well as the offer of revamping services, are an opportunity, being a source of commercial attraction to increase Gefran's competitiveness on the market

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
RESOURCEOUTFLOWS RELATEDTO PRODUCTS ANDSERVICES
WASTE	The Gefran Group's waste production has animpact on environmental pollution
RESOURCE INFLOWS,INCLUDING RESOURCEUSE,RESOURCEOUTFLOWS RELATEDTO PRODUCTS ANDSERVICES			Failure to offer products developed with a focus on circularity(also with regard to packaging) may give rise to the risk of lossof reputational value and/or competitiveness of Gefran on themarket, as well as to possible non-compliance with sustainability regulations

ESRS S1 Own Workforce

Annual Financial Report at 31 december 2025 Gefran Group

ESRS S2 Workers in the value chain

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
WORKING CONDITIONS	Failure to pay attention to working conditions andto the management of health and safety at workalong the supply chain may cause accidents and/or injuries at work to the detriment of workers

ESRS S4 Consumers and end users

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
PERSONAL SAFETY OFCONSUMERS AND/OREND USERS	Failure to comply with product quality and safetyregulations, in the various product applications,and with consumer information, as well as possible quality defects, may cause malfunctions ordefects, exposing end-users to safety risks
INFORMATIONRELATED IMPACTS FORCONSUMERS AND/OREND-USERS			Risk of loss of opportunities or competitiveness on the marketdue to delays in innovation and digitalisation of processesintended to drive innovation, anticipating and/or influencingcustomer needs

Expanding the portfolio of available certification focused on user safety, is a business opportunity to cover new applications and reach new market segments

Annual Financial Report at 31 december 2025 Gefran Group

ESRS G1 Business conduct

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
			Delays in fulfilling regulations on sustainability reporting and inimplementing strategies may give rise to the risk of regulatorynon-compliance, as well as loss of reputational value
BUSINESS CULTURE			Attacks on the Company's computer network, which is moreexposed also as a result of new technologies and smart workingmethods, may give rise to the risk of business disruptions, lossof sensitive data, leading to higher costs for system recovery
BUSINESS CULTURE,CORRUPTION ANDBRIBERY			Ineffectiveness of the Organisational Model pursuant to ItalianLegislative Decree 231/2001 (e.g. delays in updating newoffences), including the Anti-Corruption guidelines, may lead tothe risk of non-compliance and the perpetration of offences
PROTECTION OFWHISTLEBLOWERS		The establishment of secure, anonymous andaccessible channels allows all stakeholders toreport unlawful conduct without fear of retaliation or discrimination within the Group and alongthe value chain
MANAGEMENT OFRELATIONSHIPS WITHSUPPLIERS INCLUDINGPAYMENT PRACTICES			The absence of local supply chains (near plants) in a businesscontext characterised by geopolitical tensions and/or unpredictable events (e.g. export restrictions on critical raw materials byChina, tariffs) may result in supply delays, with the consequentrisk of production interruptions and difficulty in ensuring continuity for customersCritical supply chain issues (e.g. shortage, allocation issues, inflation-related tensions or cyber risks) may cause unavailability ofmaterials, resulting in a risk of delays in supply or additional costs

Promoting a culture of economic, social and environmental sustainability within the supply chain represents an opportunity for the development of collaborations and/or projects that bring economic or reputational benefits

(ESRS 2 – SBM-3 48 a, b, c)

Analysis of risk factors and an assessment of their magnitude and likelihood of occurrence is the prerequisite for the creation of value in the organisation: the ability to manage risks helps the Company to face its corporate and strategic choices with awareness and confidence, as well as helping to prevent negative impacts. Gefran has implemented a structured Enterprise Risk Management system ("ERM") for all business processes and at all organisational levels that contribute to the achievement of the Group's strategic objectives. This allows for the identification of situations that might jeopardise the achievement of strategic (business and sustainability) objectives and for taking the appropriate decisions, aimed at mitigating the Group's risk exposure.

It should therefore be noted that during the year in question, no risks and/ or opportunities arose associated with significant sustainability issues such as to have significant financial effects. In addition, the funds entered in the financial statements are not linked to sustainability issues. (ESRS SBM-3 48 b, d)

In addition to the process described above, the Group has carried out a specific analysis to identify the exposure of its assets and its strategy to physical and transition climate risks, described in detail in the specific paragraphs of the section Environmental Information included in this Report.

The DMA process, carried out as defined by the Group's Procedure for Preparing the Sustainability Report, approved by the Board of Directors on 13 February 2025, is supervised by the Sustainability Committee and is conducted without the involvement of external experts. The following points are considered:

/ the requirements of the applicable regulations (minimum requirements and disclosure), including the identification and assessment of the main Impacts, Risks and Opportunities arising from the Group's business, products, services or commercial relations, taking into account its value chain

(mapping processes along the chain);

/ published guidelines;

/ the expectations and interests of internal and external Stakeholders;

/ the main topics and future challenges for the sector, as identified by peers, competitors, databases (benchmarking) and sources recognised by the

• sector;
• Plan);

/ the corporate objectives already defined (Industrial Plan and Sustainability

/ laws, regulations, international agreements or voluntary agreements of strategic importance to the Group and its Stakeholders;

/ the links between impacts related to possible dependencies (e.g. on strategic raw materials) and the risks and opportunities that may arise from them, taking into account the Company's business, as well as the peculiarities of the products produced and of the activities and processes carried out;

/ the United Nations Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.

Particular attention is paid to Gefran's risk assessment and management model and to the results of the Enterprise Risk Management process, already

integrated with ESG risks.

The potentially material topics related to the sub-topics indicated in ESRS 1 (Appendix A – RA 16) are identified. The IRO Long List was defined, in accordance with the relevant requests, by a process carried out at various levels:

/ the outcome of previous assessments, carried out as described with reference to the various sources (public and/or internal), allowed for the definition of a "preliminary" IRO Long List, with IROs connected to the topics and sub-topics described in the ESRS (see ESRS 1.AR 16 checklist);

/ meetings were held with specific functions (e.g. Procurement, QHSE, Innovation), in order to assess the completeness of the "preliminary" IRO Long List and to consider the possible significance of Gefran's impacts, including with regard to processes along the chain.

(ESRS SBM-3 48 f)

Impact, Risk and Opportunity Management – Materiality Assessment Process

IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities

The Double Materiality Assessment (DMA), conducted by the Group in accordance with the provisions of the ESRS, has enabled it to define the relevant ESG areas and topics on which it must provide disclosure to the Stakeholders and users of the sustainability report. It is based on two different dimensions or views:

• / impact materiality, i.e. the assessment of the impacts (magnitude and likelihood of occurrence) that the Group and/or its chain have or cause on the environment and on people;
• / financial materiality, i.e. the assessment of risks and opportunities (through the estimate of the related financial effects and their likelihood of occurrence) that may significantly affect the Group's activities and in particular its ability to generate income (what is known as inherent assessment, which does not take into account any mitigation actions already implemented).

Annual Financial Report at 31 december 2025 Gefran Group

The IRO Long List thus identified was shared and validated with the Sustainability Working Group and with Management (C-level and managers of key functions), then assessed according to the double perspective described above. It is specified that the C-levels and managers of key functions involved are members of the Sustainability Working Group (which, in addition to the Sustainability Committee, constitutes Gefran's Sustainability Governance), with in-depth knowledge of the Group's corporate processes and with visibility of Gefran's Value Chain for their activities. (ESRS 2 – IRO-1 53 a, b, c)

1.1 Value chain analysis and Identification of the list of the organisation and its VC

1.2

1.3

Annual Financial Report at 31 december 2025 Gefran Group

Stakeholder engagement

As provided for in the specific Procedure, representatives of the most affected categories of Stakeholders are involved in the assessment. Their views are requested on topics identified as potentially relevant to Gefran (including its chain), depending on their direct correlation.

Internal Stakeholder engagement, aimed at DMA, involves the Group's Top Management and Governance in training activities, in the definition of the IRO long list and the gathering of the assessment of all IROs identified as potentially material, through workshops, dedicated meetings and the completion of questionnaires.

In order to obtain a more representative view of the material topics to be included in the report and in the sustainability strategy, Gefran also periodically organises engagement activities aimed at collecting impact evaluations from Stakeholders external to the Group, who are asked to assess the areas they manage or in which they are directly involved. The table below summarises the external Stakeholder engagement activities organised in 2024 that contributed to the DMA:

	Climatechange
Researchentities

2.1 Definition of IRO model and criteria for Stakeholder selection

2.2

Impact assessment – impact materiality Risk and opportunity assessment – financial materiality

• Stakeholder engagement (internal and external), using different methods of engagement

• Sharing of training material in order to collect as informed an assessment as possible

• Group governance was involved

• in the materiality assessment

2.3 Definition of the relevant IRO list

• Definition of the materiality threshold for impacts, risks and opportunities
• Validation of the IRO list and the relevant topics

Definition of the IRO model for IRO classification (categories) and evaluation (drivers and metrics) and selection of Stakeholders to be involved in the evaluation

CONSOLIDATED FINANCIAL STATEMENTS

164 165

CURRENT IMPACTS

POTENTIAL IMPACTS

*Only for negative impacts **For current impacts equal to 4 LIKELIHOOD**

In order to receive a valuable contribution, various methods of engagement are implemented, depending on the characteristics and relationships already established with the various types of Stakeholders, and also taking into account their level of general approach to the subject.

	Stakeholders Listening tools and engagement modes	Involved	Completed	Internalcontactfunction
Employees	/ Selection of employee panel, representative of allGroup companies/ Webinar in two languages (IT & EN) and sending ofemail with training material/ Self-completion of questionnaire	46	35 (76%)	People &Organization
Customers	/ Selection of panel of customers, in Italy andabroad, among those showing knowledge andinterest in ESG issues/ Phone call by the engagement reference function/ Sending of email with training material/ Self-completion of questionnaire	7	5 (71%)	Sales
Suppliers	/ Selection of panel of strategic suppliers, in Italyand abroad, representative of the supply chain andin part already involved in the "Supplier Day" path/ Phone call by the engagement reference function/ Sending of email with training material/ Self-completion of questionnaire	19	19 (100%)	Procurement
ResearchEntities	/ Involvement of the main research entities withwhich we work, both in Italy and abroad/ Phone call by the engagement reference function/ Sending of email with training material/ Self-completion of questionnaire	2	2 (100%)	Innovation

(ESRS 2 – IRO-1 53)

Impact and financial materiality

Each Impact is assessed in terms of impact and likelihood of occurrence, with Magnitude being assessed for each individual component thereof. The assessment is requested not taking into account any impact mitigation actions, on a scale from 1 to 4, giving priority to negative impacts based on their severity and corresponding likelihood.

Annual Financial Report at 31 december 2025 Gefran Group

Evaluations were collected from Gefran's Top Management and Governance (both in terms of impact materiality and financial materiality) and from external stakeholders (solely in terms of impact materiality) involved in engagement activities, as illustrated in the previous section.

After consolidating the assessments collected from Stakeholders and considering their weighted average, a further qualitative assessment was carried out, for the purpose of identifying the material IROs for this Report, following the vote expressed in the preliminary phase so as to finalise the analysis, especially with regard to impacts on human rights and the need to primarily consider magnitude rather than likelihood. The materiality threshold was thus defined and the IROs are considered material when:

• / they are assessed in terms of magnitude at a critical level (value 4), regardless of the likelihood of occurrence;
• / they are assessed in terms of magnitude at a high level (value 3), where the likelihood of occurrence is assessed as probable (value 3) or highly probable (value 4).

With the aim of further increasing the value of the assessment of Impacts, Risks and Opportunities and enriching the various processes, during 2025 an activity was carried out to integrate the information flows managed through the Enterprise Risk Management process and the Double Materiality Assessment process. The greater sharing of information and the connections between IROs, strategic objectives, policies and actions offer the Group the possibility of a more inclusive, coherent and cross-cutting mapping activity.

Also the materiality assessment of Risks and Opportunities is based on the combination of the likelihood of occurrence and the potential magnitude of financial effects. Risk assessment (inherent risk) is entrusted to the ERM process already implemented by Gefran, which actively involves the Parent Company's Management. Therefore, the assessment of opportunities and risks not already included in the ERM and identified solely for the purposes of the DMA process has been supplemented using the same scale already shared, taking into account the Company's business, as well as the peculiarities of its products, activities and processes.

According to the assessment and significance scales used in the impact and financial materiality process, consistent with those already applied to the ERM process, a Heat-Map 4X4 is used.

Likelihood range

DISCLOSURE OBLIGATION AND/OR CORRESPONDING INFORMATION	PAGE

ESRS 2	General disclosures
BP-1	General basis for preparation of the sustainability statement	120-121
BP-2	Disclosure in relation to specific circumstances	121-122
GOV-1	Role of administrative, management and supervisory bodies	123-128
GOV-2	Information provided to the undertaking's administrative, management	129-130
	and supervisory bodies and sustainability issues addressed by them
GOV-3	Integration of sustainability-related performance in incentive schemes	131
GOV-4	Statement on due diligence	132
GOV-5	Risk management and internal controls over sustainability reporting	133
SBM-1	Strategy, business model and value chain	134-142
SBM-1	Involvement in activities related to fossil fuel activities, paragraph 40(d)(i)	Not applicable since the Group is not involved in activities related to those indicated
SBM-1	Involvement in activities related to chemical production, paragraph 40(d)(ii)	Not applicable since the Group is not involved in activities related to those indicated
SBM-1	Involvement in activities related to controversial weapons, paragraph 40(d)(iii)	Not applicable since the Group is not involved in activities related to those indicated
SBM-1	Involvement in activities related to cultivation and production of tobacco, paragraph 40(d)(iv)	Not applicable since the Group is not involved in activities related to those indicated
SBM-2	Interests and views of stakeholders	143-146
SBM-3	Material impacts, risks and opportunities and their interaction with our strategy and business model	146-158
IRO-1	Description of the processes to identify and assess material impacts, risks and opportunities	158-167
IRO-2	Disclosure obligations of ESRS covered by the undertaking's Sustainability Statement	168-183
MDR-P	Policies adopted to address material sustainability issues	184-202
MDR-A	Actions and resources in relation to material sustainability matters	203
MDR-M	Metrics in relation to material sustainability matters	203
MDR-T	Tracking effectiveness of policies and actions through targets	203-205

IRO-2 Disclosure obligations of ESRS covered by the undertaking's Sustainability Statement

The topics arising as material from the double materiality assessment described above are addressed in this Report. It should be noted that, as required by ESRS 1 – Appendix C, the phase-in measures described above have been adopted, and therefore the social indicators provided by ESRS S2 and S4 are only partially addressed, despite being related to the relevant topics shown in the table. (ESRS 2 – IRO-2 59)

The disclosure obligations that the Group has fulfilled in preparing this Sustainability Report are set out below.

ESRS E1	Climate change
	ESRS 2 GOV-3 E1 Integration of sustainability-related performance in incentive schemes	222
E1-1	Transition plan for climate change mitigation	223
	ESRS 2 SBM-3 E1 Material impacts, risks and opportunities and their interaction with our strategy and business model	224-226
ESRS 2 IRO-1 E1	Description of the processes to identify and assess material climate-related impacts, risks and opportunities	227-228
E1-2	Policies related to climate change mitigation and adaptation	229
E1-3	Actions and resources in relation to climate change policies	230-233
E1-4	Targets related to climate change mitigation and adaptation	234-235
E1-5	Energy consumption and mix	236-242
E1-6	Gross Scopes 1, 2, 3 and Total GHG emissions	243-253
E1-7	GHG removals and GHG mitigation projects financed through carbon credits	Not applicable for the Group
E1-8	Internal carbon pricing	Not applicable for the Group
E1-9	Anticipated financial effects from material physical and transition risks and potential climate-related opportunities	Phase-in
ESRS E2	Pollution	Not relevant
ESRS E3	Water and Marine Resources	Not relevant
ESRS E4	Biodiversity and ecosystems	Not relevant
ESRS E5	Resource use and circular economy
ESRS 2 IRO-1 E5	Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities 254-257
E5-1	Policies related to resource use and circular economy	258
E5-2	Actions and resources related to resource use and circular economy	259-263
E5-3	Targets related to resource use and circular economy	264-266
E5-4	Resource inflows	267-269
E5-5	Resource outflows	269-275
E5-6	Anticipated financial effects from resource use and circular economy-related impacts, risks and opportunities	Phase-in
ESRS S1- Own workforce
	ESRS 2 SBM-3 S1 Material impacts, risks and opportunities and their interaction with our strategy and business model	278-284
	ESRS 2 SBM-3 S1 Risk of incidents of forced labour, paragraph 14 (f)	Not relevant
	ESRS 2 SBM-3 S1 Risk of incidents of child labour, paragraph 14 (g)	Not relevant
S1-1	Policies related to own workforce	285-286
S1-2	Processes for engaging with own workers and workers' representatives about impacts	287-288
S1-3	Processes to remediate negative impacts and channels for own workers to raise concerns	288
S1-3	Grievance/complaints handling mechanisms, paragraph 32 (c)	288
S1-4	Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities	289-295
	related to own workforce, and effectiveness of those actions
S1-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	295-298
S1-6	Characteristics of the undertaking's employees	299-303
S1-7	Characteristics of non-employee workers in the undertaking's own workforce	303
S1-8	Collective bargaining coverage and social dialogue	304-305
S1-9	Diversity metrics	305-306
S1-10	Appropriate wages	307
S1-11	Social protection	307
S1-12	Persons with disabilities	307
S1-13	Training and skills development metrics	308-310
S1-14	Health and safety metrics	311-313

S1-15	Work-life balance metrics	314
S1-16	Compensation metrics (pay gap and total compensation)	315
S1-17	Incidents, complaints and severe human rights impact	316
ESRS S2	Workers in the value chain
	ESRS 2 SBM-3 S2 Material impacts, risks and opportunities and their interaction with our strategy and business model	317-318
S2-1	Policies related to value chain workers	319
S2-4	Taking action on material impacts on value chain workers, and approaches to managing material risks	320
	and pursuing material opportunities related to value chain workers, and effectiveness of those actions
S2-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	321-322
ESRS S3	Affected communities	Not relevant
ESRS S4	Consumers and end users
	ESRS 2 SBM-3 S4 Material impacts, risks and opportunities and their interaction with our strategy and business model	323-325
S4-1	Policies related to consumers and end-users	326-327
S4-4	Taking action on material impacts on consumers and end-users, and approaches to managing material risks	327-328
	and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions
S4-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks	329
	and opportunities (consumers and end users)
ESRS G1	Business conduct
ESRS 2 GOV-1 G1	Role of administrative, management and supervisory bodies	336
ESRS 2 IRO-1 G1	Description of the processes to identify and assess material impacts, risks and opportunities	337-340
G1-1	Corporate culture and business conduct policies	341-345
G1-2	Management of relationships with suppliers	346-349
G1-3	Prevention and detection of corruption and bribery	350-351
G1-4	Confirmed incidents of corruption or bribery	Not relevant
G1-5	Political influence and lobbying activities	Not relevant
G1-6	Payment practices	351-352

Annual Financial Report at 31 december 2025 Gefran Group

The table below shows the information items resulting from other EU regulations listed in Appendix B of Annex II to the CSRD.

	DISCLOSURE OBLIGATION AND/ORCORRESPONDING INFORMATION	SFDR4 REFERENCE	PILLAR 35 REFERENCE	REFERENCE IN THE REGULATION ONREFERENCE INDICES6	EU CLIMATELEGISLATION REFERENCE7	PAGE
ESRS 2	General disclosures
GOV-1	Board's gender diversity,paragraph 21(d)	Annex I, Table 1, indicator No. 13		Commission Delegated Regulation (EU)2020/1816 (5), Annex II		123-128
GOV-1	Percentage of independent boardmembers, paragraph 21(e)			Commission Delegated Regulation (EU)2020/1816, Annex II		123-128
GOV-4	Statement on due diligence,paragraph 30	Annex I, Table 3, indicator No. 10				132
SBM-1	Involvement in activities relatedto fossil fuel activities,paragraph 40(d)(i)	Annex I, Table 1, indicator No. 4	Article 449a of Regulation (UE)No. 575/2013; CommissionImplementing Regulation (EU)2022/2453 (6), Table 1 – Qualitativeinformation on environmental riskand Table 2 – Qualitative information on social risk	Commission Delegated Regulation (EU)2020/1816, Annex II		Not applicable since the Group is notinvolved in activities related to thoseindicated
SBM-1	Involvement in activities relatedto chemical production,paragraph 40(d)(ii)	Annex I, Table 2, indicator No. 9		Commission Delegated Regulation (EU)2020/1816, Annex II		Not applicable since the Group is notinvolved in activities related to thoseindicated
SBM-1	Involvement in activities relatedto controversial weapons,paragraph 40(d)(iii)	Annex I, Table 1, indicator No. 14		Article 12(1) of Delegated Regulation (EU)2020/1818 (7) and Annex II to DelegatedRegulation (EU) 2020/1816		Not applicable since the Group is notinvolved in activities related to thoseindicated
SBM-1	Involvement in activities relatedto cultivation and production oftobacco, paragraph 40(d)(iv)			Article 12(1) of Delegated Regulation (EU)2020/1818 and Annex II to DelegatedRegulation (EU) 2020/1816		Not applicable since the Group is notinvolved in activities related to thoseindicated
ESRS E1	Climate change
E1-1	Transition plan to reach climateneutrality by 2050, paragraph 14				Article 2(1) of Regulation (EU) 2021/1119 223
E1-1	Undertakings excluded from Parisaligned Benchmarks,paragraph 16 (g)		Article 449a of Regulation (EU)No. 575/2013; CommissionImplementing Regulation (EU)2022/2453, Model 1: Bankingbook-Climate Change transition risk:Credit quality of exposures by sector, emissions and residual maturity	Article 12(1)(d) to (g) and (2) of DelegatedRegulation (EU) 2020/1818		Not applicable

E1-4	GHG emission reduction targets,paragraph 34	Annex I, Table 2, indicator No. 4	Article 449a of Regulation (EU)No. 575/2013; CommissionImplementing Regulation (EU)2022/2453, Model 3: Bankingbook – Indicators of potentialclimate-related transition risk:alignment metrics	Article 6 of Delegated Regulation (EU)2020/1818		234-235
E1-5	Energy consumption from fossilsources disaggregated by sources(only high climate impact sectors),paragraph 38	Annex I, Table 1, indicator No. 5 andAnnex I, Table 2, indicator No. 5				236-242
E1-5	Energy consumption and mix,paragraph 37	Annex I, Table 1, indicator No. 5				236-242
E1-5	Energy intensity associated withactivities in high climate impactsectors, paragraphs 40 to 43	Annex I, Table 1, indicator No. 6				236-242
E1-6	Gross Scopes 1, 2, 3 and Total GHGemissions, paragraph 44	Annex I, Table 1, indicators Nos. 1and 2	Article 449a of Regulation (EU)No. 575/2013; CommissionImplementing Regulation (EU)2022/2453, Model 1: Bankingbook-Climate Change transitionrisk: Credit quality of exposuresby sector, emissions and residualmaturity	Articles 5(1), 6 and 8(1) of DelegatedRegulation (EU) 2020/1818		243-253
E1-6	Gross GHG emissions intensity,paragraphs 53 to 55	Annex I, Table 1, indicator No. 3	Article 449a of Regulation (EU)No. 575/2013; CommissionImplementing Regulation (EU)2022/2453, Model 3: Bankingbook – Indicators of potentialclimate-related transition risk:alignment metrics	Article 8(1) of Delegated Regulation (EU)2020/1818		243-253
E1-7	GHG removals and carbon credits,paragraph 56				Article 2(1) of Regulation (EU) 2021/1119 Not applicable
E1-9	Exposure of the benchmark portfolio to climate-related physicalrisks, paragraph 66			Annex II to Delegated Regulation (EU)2020/1818 and Annex II to DelegatedRegulation (EU) 2020/1816		Phase-in

			Article 449a of Regulation (EU)No. 575/2013; points 46 and 47
	Disaggregation of monetary		of Commission Implementing
E1-9	amounts by acute and chronic		Regulation (EU) 2022/2453; Model		Phase-in
	physical risk, paragraph 66 (a)		5: Banking book - Climate change
			physical risk: Exposures subject tophysical risk
			Article 449a of Regulation (EU)
			No. 575/2013; points 46 and 47
	Location of significant assets at		of Commission Implementing
E1-9	material physical risk,		Regulation (EU) 2022/2453; Model		Phase-in
	paragraph 66(c)		5: Banking book - Climate change
			physical risk: Exposures subject to
			physical risk
			Article 449a of Regulation (EU) No.
			575/2013; point 34 of Commission
	Breakdown of the carrying value		Implementing Regulation (EU)
E1-9	of its real estate assets by ener		2022/2453; Model 2: Banking book		Phase-in
	gy-efficiency classes, paragraph		- Climate change transition risk:
	67 (c)		Loans collateralised by immovable
			property - Energy efficiency of the
			collateral
	Degree of exposure of the portfolio			Annex II to Delegated Regulation (EU)
E1-9	to climate-related opportunities,			2020/1818	Phase-in
	paragraph 69
ESRS E2	Pollution				Not relevant
ESRS E3	Water and Marine Resources				Not relevant
ESRS E4	Biodiversity and ecosystems				Not relevant
ESRS E5	Resource use and circulareconomy
E5-5	Non-recycled waste, paragraph	Annex I, Table 2, indicator No. 13			269-275
	37 (d)
E5-5	Hazardous waste and radioactive	Annex I, Table 1, indicator No. 9			269-275
	waste, paragraph 39
ESRS S1	Own workforce
	ESRS 2 SBM-3 S1 Risk of incidents of forced labour,paragraph 14 (f)	Annex I, Table 3, indicator No. 13			Not relevant
	ESRS 2 SBM-3 S1 Risk of incidents of child labour,	Annex I, Table 3, indicator No. 12			Not relevant
	paragraph 14 (g)
S1-1	Human rights policy commitments,	Annex I, Table 3, indicator No. 9 and			285-286
	paragraph 20	Annex I, Table 1, indicator No. 11

S1-1	Due diligence policies on issuesaddressed by the fundamentalInternational Labour OrganisationConventions 1 to 8, paragraph 21		Commission Delegated Regulation (EU)2020/1816, Annex II	285-286
S1-1	Processes and measures forpreventing trafficking in humanbeings, paragraph 22	Annex I, Table 3, indicator No. 11		Not relevant
S1-1	Workplace accident preventionpolicy or management system,paragraph 23	Annex I, Table 3, indicator No. 1		285-286
S1-3	Grievance/complaints handlingmechanisms, paragraph 32 (c)	Annex I, Table 3, indicator No. 5		288
S1-14	Number of fatalities and numberand rate of work-related accidents, paragraph 88 (b) and (c)	Annex I, Table 3, indicator No. 2	Commission Delegated Regulation (EU)2020/1816, Annex II	311-313
S1-14	Number of days lost to injuries,accidents, fatalities or illness, paragraph 88 (e)	Annex I, Table 3, indicator No. 3		311-313
S1-16	Unadjusted gender pay gap, paragraph 97 (a)	Annex I, Table 1, indicator No. 12	Commission Delegated Regulation (EU)2020/1816, Annex II	315
S1-17	Incidents of discrimination, paragraph 103 (a)	Annex I, Table 3, indicator No. 7		316
S1-17	Non-respect of UNGPs onBusiness and Human Rights andOECD, paragraph 104 (a)	Annex I, Table 1, indicator No. 10and Annex I, Table 3, indicator No.14	Annex II to Delegated Regulation (EU)2020/1816 and Article 12(1) of DelegatedRegulation (EU) 2020/1818	316
ESRS S2	Workers in the value chain
S2-1	Policies related to value chain workers, paragraph 18	Annex I, Table 3, indicator No. 11and 4		319
ESRS S3ESRS S4	Affected communitiesConsumers and end users			Not relevant
S4-1	Policies related to consumers andend-users, paragraph 16	Annex I, Table 3, indicator No. 9and Annex I, Table 1, indicator No. 11		326-327
S4-1	Non-respect of UNGPson Business and Human Rightsand OECD guidelines, paragraph 17	Annex I, Table 1, indicator No. 10	Annex II to Delegated Regulation (EU)2020/1816 andArticle 12(1) of Delegated Regulation (EU)2020/1818	326-327
S4-4	Human rights issues and incidents,paragraph 35	Annex I, Table 3, indicator No. 14		327-328

(ESRS 2 IRO-2 56)

ESRS G1	Business conduct
G1-1	United Nations Convention againstAnnex I, Table 3, indicator No. 15		341-345
	Corruption, paragraph 10(b)
G1-1	Protection of whistleblowers, parAnnex I, Table 3, indicator No. 6		341-345
	agraph 10 (d)
	Fines for violation of anti-corrup	Annex II to Delegated Regulation (EU)
G1-4	tion and anti-bribery laws, paraAnnex I, Table 3, indicator No. 17	2020/1816	Not relevant
	graph 24(a)
G1-4	Standards of anti- corruption andAnnex I, Table 3, indicator No. 16		Not relevant
	anti- bribery, paragraph 24(b)

4 Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (SFDR) (OJL 317, 9.12.2019, p. 1).

5 Regulation (EU) no. 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No. 648/2012 (capital requirements regulation) (OJ L 176, 27.6.2013, p. 1).

6 Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) 596/2014 (OJ L 171, 29.6.2016, p. 1).

7 Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 ('European Climate Law') (OJ L 243, 9.7.2021, p. 1).

Annual Financial Report at 31 december 2025 Gefran Group

Impact, Risk and Opportunity management – Policies and actions

CODE OF ETHICS AND CONDUCT

Content	It summarises the ethical and moral principles that the companies of the GefranGroup undertake to strictly comply with while conducting their business.
Objectives	It inspires conduct and has been chosen as a tool for formalising and disseminating the rigorous ethical and moral principles that the Group undertakes toapply and comply with
Scope of application	It extends to all Group companiesThe provisions of the Code influence all business processes: employee management, customer relations and public administration, selection and managementof suppliers, financiers and external collaborators
Policy signing	Board of Directors of Gefran S.p.A. (the Company at the head of the Gefran Group)
Policy ImplementationManager	Gefran Directors and Employees are required to ensure that the principles of theCode of Ethics and Conduct are adequately respected within Gefran and, in general, by all the Group's interlocutors. The Supervisory Body liaises with the company departments and bodies responsible for the correct implementation andadequate control of the Principles of the Code, and may access all useful corporate information sources for its purpose and view internal documents, data andprotocols, operating independently with respect to senior management, fromwhich it receives full support. Senior management refers to the Chairwoman andthe Chief Executive Officer and, where necessary, the Board of Directors and theBoard of Statutory Auditors.
Reference standards	Stakeholders are required to act in absolute compliance with the laws andregulations in force at national and international level. The Code of Ethics is anintegral part of the Organisational, Management and Control Model pursuant toItalian Legislative Decree 231/01. Any measures and/or sanctions (of any kind)relating to violations of the Code will be adopted by the competent bodies on thebasis of applicable legislation, the internal disciplinary system and the provisionsof national collective agreements (where recognised by law).
Stakeholders concerned	Gefran intends to share the principles contained in the Code with all its recipients (Stakeholders), with whom it maintains necessary relations for the fulfilment of its promises and purposes: shareholders, employees and collaboratorsin the broad sense, corporate bodies, the public administration, customers, suppliers of goods and services, competitors, financiers, the stock market, politicaland trade union organisations, the media, the environment and the territory.
Method of dissemination	It is disclosed through internal company channels (physical and digital pinboards,corporate intranet, HR platform) and published on the Company's website to bealso accessed by external Stakeholders. It is the subject of training campaigns,and its endorsement is part of the onboarding process for new employees.

MDR-P Policies adopted to address material sustainability issues

The Code of Ethics and Conduct, formalised by the Gefran S.p.A. Board of Directors (last updated on 10 March 2022) and adopted by all Companies of the Group, guides the conduct of all activities, describing the ethical and moral principles that the Companies of the Gefran Group undertake to strictly comply with while conducting their business. They are inspired by universal principles:

The ethical principles and rules of conduct set out in the Group's Code apply to the many different areas of its activities, including among others:

• / the protection and enhancement of human resources, through selection, evaluation and training processes;
• / the promotion of sustainable development with respect for the environment and the territory.

Below is an overview of the policies that, in addition to the Code of Ethics and Conduct, guide Gefran in the pursuit of its cross-cutting activities

INTEGRITY FAIRNESS AND PROFESSIONALISM ENTHUSIASM AND PASSION CONCRETENESS AND RELIABILITY FLEXIBILITY SUSTAINABILITY

POLICY FOR MANAGING DIALOGUE WITH SHAREHOLDERS AND INVESTORS

Content	The Policy for Managing Dialogue with Shareholders and Investors of Gefran S.p.A.defines the methods, principles and responsibilities with which the Companypromotes transparent and structured dialogue with its financial stakeholders. Itdraws on the Italian Corporate Governance Code and the Code of Ethics of theGefran group, promoting constructive dialogue with its shareholders to createvalue over the medium-to-long term.
Objectives	Promote a proper, transparent and balanced dialogue with current and potentialShareholders (professional, institutional, retail shareholders), financial analystsand corporate brokers. Ensure compliance with current regulations, includingthose concerning relevant and insider information.
Scope of application	Gefran S.p.A., listed on the Euronext STAR Milan segment
Policy signing	The Gefran S.p.A. Board of Directors.
Policy ImplementationManager	The Chairwoman and the Chief Executive Officer are responsible for dialoguewith the recipients of the Policy, on the basis of their powers of representation.The Investor Relations function is the point of contact.
Reference standards	Corporate Governance Code (2020), Insider Information and Market AbuseRegulation (MAR). CONSOB and Borsa Italiana regulations.
Stakeholders concerned	The recipients of the dialogue are strategic interlocutors for the Company:Shareholders and financial operators.
Method of dissemination	It is published on the Company's website to be used by the Stakeholdersconcerned.

SOCIAL MEDIA POLICY

Content

Content	Gefran S.p.A.'s Social Media Policy defines the rules and behaviours to be adoptedwhen using social media, both within the company and personally, in order toprotect the Group's image and reputation. It includes guidelines for interactionwith the official Gefran social media profiles, including the production and publication of content, and suggestions for the responsible use of personal profiles.
Objectives	Promote responsible and informed use of social media. Prevent reputational andlegal damage arising from inappropriate content. Align digital communicationswith company values and the Gefran Code of Ethics.
Scope of application	It applies to all Group companies
Policy signing	Communications Office of Gefran S.p.A.
Policy ImplementationManager	Its implementation involves the entire organisation. Each employee is encouragedto report any comments on Social Media to the Communications Department.
Reference standards	Implicit references to the protection of copyright and intellectual property andto the Company's internal regulations and codes.
Stakeholders concerned	It is intended mainly for Group employees and is generally aimed at creating valuefor all internal and external Stakeholders.
Method of dissemination	It is disclosed through the internal company channels (the intranet).

Gefran has adopted various policies and procedures to manage specific sustainability issues related to relevant IROs, reporting on them in the specific paragraphs of this Report in which the issues are described.

Below is an overview of the main policies through which the Group declares its commitments in the management of sustainability issues.

HEALTH, SAFETY AND ENVIRONMENT POLICY

Policy signing	Chief Executive Officer
Scope of application	It applies to all Group entities, in every activity, and involves the supply chainthrough the selection of suppliers, requiring them to adopt a management modelsimilar to that of Gefran, in compliance with the HSE standards adopted and withinternational laws and standards.	Method of dissemination
Objectives	The harmonisation of the management of HSE issues is seen as an essentialelement in generating added value, for the benefit of all the Group's internal andexternal Stakeholders.	Stakeholders concerned
	It seeks to harmonise environmental management through the declared guidelines, which focus on the prevention of environmental damage, the optimizationof the consumption of energy resources, the responsible management of thesupply chain and the preparation of training and adequate safeguards.	Reference standards
Content	With regard to the use of resources and the circular economy, a specific policy has not yet been formalised, as some aspects of this topic are included inthe broader Health, Safety and Environment System Policy: optimisation of theconsumption of energy resources and raw materials, prevention of pollution byidentifying, monitoring and reducing the environmental impact of its processesand products.
	With regard to health and safety, Gefran undertakes, through the Policy, to identify and assess possible risks, as well as to minimise them through the implementation of actions, including those aimed at prevention. These include theimportance of creating a culture of safety at work and respect for the environment, through accountability, continuous training and motivation of people.	Policy ImplementationManager
	It summarises the guidelines that Gefran is committed to following with regardto the management of HSE issues, including climate change, environmental protection and the optimisation of energy resources (specifically, it does not currently include the development of renewable energy).

The entire organisation is responsible for its implementation. Specifically, thecentral Quality, Safety and Environment (Q-HSE) function:/ promotes proper application of the management system in accordance withthe organisation's requirements and standards (in particular ISO 14001:2015and ISO 45001:2018);/ ensures the integrity of the System in line with the Company's defined strategy.
In particular, in the field of Health and Safety at Work, Managers and Supervisorsplay a fundamental role in relation to the promotion and maintenance of themanagement system. Ongoing organisational and support activities are carriedout within the Group by centralised functions, specifically People&Organizationand Quality, Safety and Environment.
Policy implementation is also supported, in all the Group's Italian companies,by the procedures provided for in Model 231 (ORGANISATION AND MANAGEMENTPROCEDURES MANUAL pursuant to Italian Legislative Decree 231/2001).
Gefran undertakes to comply with environmental laws and to manage its activities according to the highest international standards (ISO 14001:2015 and ISO45001:2018) and the principles of continuous improvement.
It is mainly intended for Group employees and suppliers, who are expressly askedto "implement a management model similar to that of the Group", though it isgenerally geared towards creating value for all internal and external Stakeholders.
It is disclosed through internal company channels (physical and digital pinboards,corporate intranet, HR platform) and published on the Company's website to bealso accessed by external Stakeholders.
It is the subject of training campaigns, and its endorsement is part of theonboarding process for new employees.
E1 – Climate change adaptation and Mitigation / Energy
E5 – Waste / Resource inflows and outflows
S1 – Working conditions

Connected ESRS

PEOPLE IN GEFRAN POLICY

	With this Policy, Gefran is committed to the well-being of its employees, ensuringholistic welfare and allowing everyone to express their skills to the best of theirability./ It focuses on three key points:/ Respect for People/ Diversity and equal opportunities	Reference standards	Gefran is committed to respecting the laws governing human capital management and to supporting the rights recognised in the Universal Declaration ofHuman Rights in its business relations in all the countries in which it operates.The Policy is one of the bases for compliance with the SA 8000:2014 standardon Social Accountability.
Content	/ Valuing peopleIt expresses the principles of honesty, integrity and respect in the management	Stakeholders concerned	It is intended mainly for Group employees and is generally aimed at creatingvalue for all internal and external Stakeholders.
	of human capital, encouraging the active participation of all employees.Trafficking in human beings, as well as forced or compulsory labour and childlabour, are topics not regarded as relevant in the impact, risk and opportunityassessment. However, Gefran protects and promotes human rights in its business relationships in all the countries in which it operates, ensuring the absenceof any form of child labour and forced labour within its organisation.	Method of dissemination	It is disclosed through internal company channels (physical and digital pinboards,corporate intranet, HR platform) and published on the Company's website to bealso accessed by external Stakeholders.It is the subject of training campaigns, and its endorsement is part of theonboarding process for new employees.
Objectives	The Policy aims to build a professional environment that employees want to bepart of. The promise is to build tomorrow's Gefran, creating long-term value forall the Group's Stakeholders.	Connected ESRS	E1 – Climate change adaptationS1 – Working conditions / Equal treatment and opportunities for all
Scope of application	It applies to all Group entities. The entire workforce is encouraged to activelyparticipate in its implementation.
Policy signing	Chief Executive Officer
	Its operational implementation involves the entire organisation.
Policy ImplementationManager	In particular, the centralised People&Organization function (hereinafter P&O)is responsible for all organisational aspects relating to human resourcesmanagement.
	Policy implementation is also supported, in all the Group's Italian companies,by the procedures provided for in Model 231 (ORGANISATION AND MANAGEMENTPROCEDURES MANUAL pursuant to Italian Legislative Decree 231/2001).

Annual Financial Report at 31 december 2025 Gefran Group

QUALITY POLICY STATEMENT
	It represents the commitment to managing the Quality System, as the means
Content	chosen by Gefran to guarantee the satisfaction of its Stakeholders through the
	identification of their needs, expectations and the solution of identified problems.
	It aims to keep the Quality Management System effective and up-to-date, in
	accordance with ISO 9001:2015, in order to:
	/ Create and maintain an identity in line with the promise, purpose and guiding	Content
	principles of the Gefran Way
	/ Satisfy customers, effectively interpreting their needs and ensuring the best
	possible service, creating long-lasting and sustainable relationships
Objectives	/ Make talent grow
	/ Promote continuous improvement
	/ Verify the achievement of objectives
	/ Generate products that comply with the applicable binding and voluntary
	standards
	/ Search, select and develop suppliers that best meet the Group's needs	Objectives
	/ Handle any potential complaints in a timely manner with effective solutions
Scope of application	It applies to all Group entities, and in particular to all production companies cer
	tified by third parties according to the reference standard.
Policy signing	Chief Executive Officer and Head of Quality Management.
		Policy Implementation
	The entire organisation, at every level, is involved in the development and mainte	Manager
	nance of the Quality Management System.
	The Chief Executive Officer is the ultimate manager.
Policy Implementation		Reference standards
Manager	The Head of Quality Management is responsible for promoting the correct appli
	cation of the system and ensuring its integrity.
	Department/office managers ensure that the system within their area of com		are also mentioned.
	petence is known and applied. All employees are responsible for the Quality of
	their work.		for all external Stakeholders.
Reference standards	UNI EN ISO 9001:2015	Stakeholders concerned
	It is intended mainly for Group employees and is generally aimed at creating
Stakeholders concerned	value for all internal and external Stakeholders.
	It is disclosed through internal company channels (physical and digital pinboards,
	corporate intranet, HR platform) and published on the Company's website to be
Method of dissemination	also accessed by external Stakeholders.		S2 – Working conditions
	It is the subject of training campaigns, and its endorsement is part of the	Connected ESRS
	onboarding process for new employees.
	E1 – Energy
Connected ESRS	E5 – Resource inflows and outflows
	S1 – Equal treatment and opportunities for all
	S4 – Information-related impacts / Personal safety of users

SUSTAINABILITY PACT FOR GEFRAN GROUP SUPPLIERS

It describes general standards for the assessment of suppliers and the basic
principles that underlie the Group's approach to the sustainable management
of the supply chain. For Gefran, sustainability is an essential key to its corporate
processes, viewing management of the ethical, environmental and social impact
at all levels in the supply chain as a key to the success of the Group's business.

Our management focuses on definition of a long-term value-added business model in which suppliers are viewed as an integral part of our sustainability strategy.

In the supplier selection process, we pay attention not only to economic, process, technical and financial criteria but also to social factors such as compliance with human rights, working conditions, the fight against corruption and ecology.

The key goal is to direct Group companies to work with suppliers who share the Group's vision of sustainability and manage their business in an ethical, responsible way, demonstrating respect for people and the environment.

Scope of application The supply chains of all the Group's production companies.

Policy signing Chief Executive Officer (drafted by the Group's Legal and Corporate Affairs and Group Purchasing Department).

Gefran Group's suppliers are expected to comply not only with the applicable national legislation but with our Code of Ethics and the Sustainability Pact.

In addition to the national laws applicable in the countries where suppliers are based, the principles set out in the Policy are inspired by the United Nations Global Compact. Reference is also made to internal regulations, in particular the Group's Code of Ethics and Conduct. The OHSAS 18001 and ISO 14001 standards are also mentioned.

It is intended mainly for Group suppliers and is generally aimed at creating value for all external Stakeholders.

Supplier compliance with the principles and requirements stated in the Policy is regularly monitored, both through periodic self-evaluations and on-site audits planned and carried out by the Quality function, according to a defined priority plan.

Method of dissemination It is sent by the relevant buyer by email. Supplier Qualification Portal (eProcurement).

G1 – Management of relationships with suppliers

Annual Financial Report at 31 december 2025 Gefran Group

ORGANISATIONAL, MANAGEMENT AND CONTROL MODEL PURSUANT TO ITALIAN LEGISLATIVE DECREE 231/2001

	It is divided into several parts:/ General Part which defines the general characteristics of the Model, dedicat
	ing particular attention to the following aspects:
	− definition of the Supervisory Body and its functions;
	− training of personnel and dissemination of the Model throughout the
	Company and to stakeholders;
	− definition of the disciplinary system and its application;	Stakeholders concerned
	− verification of the adequacy of the Model.
	/ Special Parts covering the various types of offence envisaged in the Decree. In
	particular, Special Part "A" deals with offences against the Public Administration
Content	and obstruction of justice, Special Part "B" is dedicated to corporate offences,
	Special Part "C" relates to insider dealing and market manipulation, Special
	Part "D" covers offences connected with occupational safety, including the
	use of workers without proper papers, unlawful dealing in and exploitation of
	labour, and racism and xenophobia, Special Part "E" deals with offences against
	intellectual property, Special Part "F" is dedicated to environmental offences,Special Part "G" relates to the offences of receiving, recycling and using money,
	assets or benefits deriving from illegal sources, as well as self-laundering and
	organised crime, Special Part "H" covers IT offences, Special Part "I" relates to
	tax offences, Special Part "L" deals with smuggling, and Special Part "M" deals
	with offences relating to payment instruments other than cash.
	It is aimed at preventing the offences envisaged in Italian Legislative Decree
	231/2001.
	In order to ensure constant propriety and transparency from an ethical and
	regulatory standpoint, Gefran S.p.A. has deemed it appropriate to adopt an
	Organisational Model that achieves the following objectives:/ implement a structured and organic system of procedures and activities to
	be launched to prevent commitment of the offences identified in the Decree;
	/ involve, through the adoption of the Model and the Code of Ethics, all stake	Method of dissemination
	holders such as employees, customers, suppliers, partners, collaborators,
Objectives	etc., so that in carrying out their duties they comply with the ethical principles
	inspiring the Company;
	/ identify the Supervisory Body that will monitor the adequacy and effectiveness
	of the Model;
	/ identify and assign responsibilities and powers to each organisational unit,
	while ensuring the necessary segregation of functions so that no person can
	carry out an entire operational or decision-making process in a fully autono
	mous manner;
	/ prepare the work needed in order to update the Model periodically.
Scope of application	It applies to the Parent Company Gefran S.p.A. and the other Italian companiesand its scope of application is extended, through the relative Procedures Manual,
	to the activities carried out within the same companies.
Policy signing	Board of Directors of Gefran S.p.A. (the Company at the head of the Gefran Group).
	The function of the Supervisory Body is to inform the Board of Directors on a
	timely basis about facts and circumstances relating to its control activities, rec
Policy Implementation	ommending possible updates to the Model whenever appropriate.	Connected ESRS
Manager	The Chief Executive Officer of the Company has the power to make formal
	amendments - i.e. correct material errors - to the Model, after first informing the
	Supervisory Body.

Italian Legislative Decree 231/2001. It has been prepared in accordance with theReference standardsConfindustria Guidelines.Pursuant to art. 6 of the Decree, the requirements of the Model, including itsattachments, apply in the context of Gefran S.p.A. to:/ members of Corporate Bodies;/ Employees;/ Collaborators;Stakeholders concerned/ whoever acts in the name or on behalf of the Company, under its direction andsupervision, regardless of their employment status.
The adoption of the Model is generally aimed at creating value for all internal andexternal Stakeholders.
It is disclosed through internal company channels (physical and digital pinboards,corporate intranet, HR platform) and published on the Company's website to bealso accessed by external Stakeholders.
It is the subject of training campaigns, and its endorsement is part of theonboarding process for new employees.
Working together with the Chief People & Organization Officer and the Legal andCorporate Affairs Department, the SB prepares a training and communicationplan in order to ensure proper awareness about and implementation of theModel. The training and communication plan is structured as follows:/ initial training delivered on a case-by-case basis to new recruits, following theprovision of information in the letter of employment;
/ periodic refreshers (compulsory attendance) on the general contents of theModel;/ specific updates (delivered on a case-by-case basis depending on need, withMethod of dissemination
compulsory attendance) for personnel involved in various ways in processesand activities at risk;/ creation of an intranet site, periodically updated, containing the Model and any
updates;/ communications by e-mail about amendments and updates to the Model.
Function managers are responsible for informing their hierarchical subordinatesand making them aware of potential risk areas, as well as the consequences offailure to conduct themselves in the required manner.
In particular, the depth of training varies depending on the degree of involvementin sensitive activities and the experience of the recipients concerned.
Persons who attend classroom training must sign the attendance register while,with regard to courses delivered via the e-learning platform, the system automatically registers participants and the activities carried out.
E1 – Climate change adaptationE5 – WasteConnected ESRS

Annual Financial Report at 31 december 2025 Gefran Group

GEFRAN GROUP ANTI-CORRUPTION GUIDELINES

	The Gefran Group's Anti-Corruption Guidelines set out the fundamental principles and operational measures designed to prevent and combat corruption in allcorporate activities. They include guidance on the management of:
Content	/ Payments and benefits intended to obtain illicit advantages/ Agents, Consultants and Intermediaries/ Joint Ventures and Outsourcing/ Gifts and complimentary items/ Donations to political parties/ Charities and sponsorships/ Customs laws	Content
Objectives	Prevent corruption: avoid any form of corruption or bribery, whether in the publicor private sector, by promoting a corporate culture based on integrity, transparency and legality.Ensure compliance with national and international anti-corruption and customslaws.
Scope of application	They apply to all Group entities.
Policy signing	Implicitly by the Board of Directors of Gefran S.p.A. (the Company at the head ofthe Gefran Group).
Policy ImplementationManager	Every company in the Gefran group is required to adopt measures designed toensure compliance with the guidelines.Employees are responsible for reporting any conflicts or suspicious situations.The Internal Audit function carries out internal control activities.
Reference standards	They are based on the main anti-corruption laws and regulations currently inforce (the UK Bribery Act, US FCPA), as well as on the guidelines and regulationsissued by non-governmental organisations such as the International Chamberof Commerce (ICC), the World Economic Forum Partnering Against Corruption	Policy ImplementationManager	described.
	(PACI), and the 2005 United Nations Convention against Corruption (UNCAC).They are intended mainly for Group employees, who are required both to complywith these Guidelines in carrying out their activities and to report any unlawfulconduct of which they may become aware.	Reference standards
Stakeholders concerned	They are generally aimed at creating value for all external Stakeholders, includingpublic and customs authorities.	Stakeholders concerned
	They are published on the Company's website to be used by both internal andexternal Stakeholders.	Method of dissemination
Method of dissemination	They are the subject of specific training campaigns for the company departments concerned, and their sharing is part of the onboarding process for new
	employees working within those departments.	Connected ESRS	E5 – Waste
Connected ESRS	G1 – Business culture / Corruption

In addition, procedures and regulations have been established and disseminated for the harmonised management of processes relating to sustainability issues considered material for Gefran. The main ones are illustrated below.

SYSTEM MANAGEMENT PROCEDURE - WASTE MANAGEMENT

• The document defines the operating methods used within the Gefran Group for:
• / the Classification and Characterisation of waste produced
• / Internal waste collection
• / any Temporary storage before collection, labelling, identification
• / Registration (Loading and Unloading Register)

It applies to the management of special hazardous and non-hazardous waste produced by company departments.

Additionally, it outlines the roles and responsibilities within the process, as well as instructions for the proper management of documents.

Objectives Harmonise waste management within the Group, in accordance with the standards included in the Integrated Management System adopted by the Group.

Scope of application All the Group's production companies that have adopted the Integrated Management System.

Policy signing Employer (it is drawn up HSE and verified by QHSE).

HSE Office, Temporary Storage Control Officer and Waste Handling Officer, as described.

Proper implementation is verified during internal audits (Q-HSE department) and/or audits conducted by third parties (ISO 14001 in particular).

Current applicable national and European regulations. Specifically: Italian Legislative Decree 152/2006 (Consolidated Environmental Law), UNI 10802:2013 standard, European and national regulations on waste (CER, MUD, FIR, temporary storage, authorisations).

It is intended mainly for employees, in particular those involved in the activities described in accordance with their duties, though in general its implementation is aimed at generating value for all internal and external stakeholders.

It is disclosed through the internal company channels (in particular, the intranet).

It is the subject of training campaigns for operators directly involved in the activities described according to their duties.

Annual Financial Report at 31 december 2025 Gefran Group

WHISTLEBLOWING PROCEDURE		ENTERPRISE RISK MANAGEMENT
Content	It defines how the Group's stakeholders can report illegal or non-compliant conduct,ensuring the confidentiality and protection of whistleblowers. Reports may concern:/ EU offences (procurement, health, environment, safety, etc.)./ Violations of the Code of Ethics (e.g. human rights and workers' rights)./ Relevant conduct under Italian Legislative Decree 231/2001.		involves several phases:Risk Owners.
	The procedure is designed to:Allow for reports of violations of the law and the Code of Ethics.	Content	(stakeholders).June-July (monitoring).
Objectives
	Ensure confidentiality and structured management of reports.
	Comply with Italian Legislative Decree 24/2023 and EU Directive 2019/1937.
Scope of application	The Procedure applies to all Group companies, without prejudice to any specificlocal laws on the same subject that are found to be in conflict with it.
Policy signing	Board of Directors of Gefran S.p.A. (the Company at the head of the Gefran Group)	Scope of application	It applies to all group entities.
	The person in charge of managing the Internal Whistleblowing Channel, who var
Policy ImplementationManager	ies depending on the Group company concerned:/ For Gefran S.p.A.: the General Counsel./ For all other Group companies: the Chief People & Organization Officer.Both can use the support of the Quality & HSE Director.		CEO.
Reference standards	Italian Legislative Decree 24/2023 and EU Directive 2019/1937 on the protectionof persons who report breaches of EU law.Italian Legislative Decree 231/2001 on the administrative liability of legal persons, with reference to the Organisational, Management and Control ModelRegulation (EU) 2016/679, Italian Legislative Decree 196/2003 (Privacy Code) onthe protection of personal data.	Policy ImplementationManager	risks.ment system.
	It is consistent with the principles of the SA 8000:2014 standard on SocialAccountability.
Stakeholders concerned	It is intended for all Stakeholders, whether they be internal or external.Whistleblowers can be:	Reference standards	nal reference standard.
	/ Managers, employees, collaborators, trainees./ External Stakeholders (customers, suppliers, consultants, partners) dealingwith the Group.
Method of dissemination	It is disclosed through internal company channels (physical and digital pinboards,corporate intranet, HR platform) and published on the Company's website to bealso accessed by external Stakeholders.
	It is the subject of training campaigns, and its endorsement is part of theonboarding process for new employees.	Connected ESRS	G1 – Business culture
Connected ESRS	G1 – Protection of whistleblowers

It defines the Enterprise Risk Management model adopted by the Group, which involves several phases:

• / Periodic Risk Assessment: annual update of risks, including interviews with the Risk Owners.
• / Reporting: internal (Board of Directors, CRC, Management) and external (stakeholders).
• / Monitoring: periodic verification of mitigation actions.
• / Timeline: main activities between September-November (assessment) and June-July (monitoring).

It also describes the communication flows between Risk Management and the other actors involved in the process: Board of Directors, CRC, CEO, Management and Internal Audit function.

Objectives It describes governance, process and tools for identifying, assessing, managing and monitoring risks within the Gefran Group.

Scope of application It applies to all group entities.

Policy signing Board of Directors of Gefran S.p.A. (the Company at the head of the Gefran Group)

The policy describes the roles and responsibilities of various functions:

• / Board of Directors: it approves the policy and supervises the ERM system.
• / Control and Risks Committee (CRC): it supports the Board of Directors and the CEO.
• / CEO: the CEO promotes and maintains the ERM system.
• / Risk Management Function: it coordinates the process, updates the policy and provides methodological support.
• / Management (Risk Owner & Action Owner): it identifies, assesses and manages risks.
• / Internal Audit: it provides for an independent verification of the risk management system.

Corporate Governance Code of Borsa Italiana and CoSO Framework.

Reference is also made to the Group's Code of Ethics and Conduct as the internal reference standard.

• Stakeholders concerned It is intended mainly for actors involved in the risk assessment process, though is generally aimed at creating value for all internal and external Stakeholders. Method of dissemination It is disseminated through workshops and dedicated training as well as through
  • the internal company channels (intranet).

Annual Financial Report at 31 december 2025 Gefran Group

PROCEDURE FOR PREPARING THE SUSTAINABILITY REPORT

It describes the contents of the Gefran Group Sustainability Report, in accordance with the Corporate Sustainability Reporting Directive, as well as its drafting process, describing the roles and responsibilities of the parties involved. It illustrates:

THE INTERNET	REGULATIONS FOR THE CORRECT USE OF INFORMATION TECHNOLOGIES AND
Content	The Regulations are inspired by the principles of diligence and fairness in theemployment relationship; they promote a culture of information security andestablish rules to prevent risks related to the misuse of company informationtechnology. They include a description of the Group's technology environmentand IT infrastructure (LAN, WAN, devices, connection technologies), and provideguidance on the appropriate use of:/ company PCs (including laptops), mobile phones and company SIMs/ corporate network/ e-mail, internet browsing, antivirus sw/ password management/ IT support services and ticket managementThey also address data privacy and set rules for control activities concerning theproper use of tools.	Content	/ The main features of the CSRDReporttool and timescales
	Their implementation is designed to:/ Ensure cybersecurity, data protection and business continuity.		/ Declaration templates
Objectives	/ Prevent misuse of digital business resources./ Align with privacy regulations and business ethics.
Scope of application	They apply to all Group companies.	Objectives
Policy signing	Chief Information Officer of Gefran S.p.A.
	Each employee is responsible for the use of the IT equipment assigned thereto.	Scope of application	It applies to all group entities.
Policy ImplementationManager	The personnel of the IT office, which is part of the S.I.A. office, have been dulyinstructed by Gefran, as System Administrator, pursuant to the Order of theItalian Data Protection Authority of 27 November 2008 as amended.
Reference standards	Personal Data Protection Regulations, Labour Regulations, Intellectual PropertyRegulations, Internal Corporate Regulations (Model 231, Code of Ethics andConduct, Whistleblowing Procedure).	Policy ImplementationManager	information givenGroup's Sustainability Report.
Stakeholders concerned	They are intended mainly for Group employees.
Method of dissemination	They are disseminated through internal company channels (physical and digitalpinboards, corporate intranet, HR platform).		age is addressed.
	They are the subject of training campaigns, and their endorsement is part of theonboarding process for new employees.
Connected ESRS	G1 – Business culture	Stakeholders concerned

• / The main features of the CSRD
• / The qualitative characteristics of the information reported in the Sustainability Report
• / The roles and responsibilities of the process defined in Gefran
• / The process for preparing the Sustainability Report, including the double materiality assessment, set out at each stage and specifying the supporting tool and timescales

It is completed by the annexes, which are periodically updated in line with organisational developments and the double materiality assessment and which describe:

• / Relevant issues and reporting obligations: these are the IRO-related topics covered by a chapter of the report
• / Assignment of roles: allocation of the roles described in the procedure to members within the Gefran organisation
• / Declaration templates

Respond effectively and comprehensively to the sustainability reporting requirements envisaged by the Corporate Sustainability Reporting Directive 2022/2464/ UE (hereinafter CSRD), with the aim of promoting transparency and disclosure to the Group's Stakeholders of information regarding environmental, social and governance issues related to their activities, gathered organically and controlled by the functions with expertise in this area.

Policy signing Board of Directors of Gefran S.p.A. (the Company at the head of the Gefran Group). It is drawn up by the Sustainability Function.

Group Sustainability Committee: the Committee responsible for examining, on behalf of the Board of Directors, the general structure of the Sustainability Report and its contents, as well as the completeness and transparency of the information given

• Sustainability Reporting Manager: the person responsible for certifying the Group's Sustainability Report.
• Process Owner: the person in charge of preparing the draft Group Sustainability Report. Corporate Topic Owner: the Head of the Headquarter Function responsible for verifying local and aggregated data for the specific reporting area.
• Company Validator: the person responsible for verifying and approving company data and for sending it to the Headquarter.
• Company Data Owner: the local person to whom a specific Sub-Reporting package is addressed.
• Reference standards Corporate Sustainability Reporting Directive 2022/2464/EU, Italian Legislative Decree 125/2024 of 6 September 2024
  • It is intended both for employees, in particular those involved in the activities described by reason of their duties and powers within the organisation, though in general its implementation is aimed at generating value for all internal and external Stakeholders.
• Method of dissemination It is disseminated through workshops and dedicated training as well as through the internal company channels (intranet). Connected ESRS G1 – Business culture

202 203

PROCEDURE FOR THE MANAGEMENT OF TENDERS OR WORKS CONTRACTS

Content	Gefran S.p.A. ("Gefran" or the "Company") is the parent company of a multinational group which, in line with legal obligations and best practices in matters ofgovernance and compliance, has adopted a Code of Ethics and an Organisationaland Control Model which its employees and partners are required to comply with.One of the principles of the Gefran Code of Ethics is the promotion of occupational health and safety. The Procedure describes how a tender or works contractis to be managed at the Company's sites, excluding intellectual works contracts.It is also established that only after express written approval by Gefran may theContractor subcontract part of the work assigned thereto.
Objectives	Promote a culture of occupational health and safety and prevent the commission of "predicate offences" within the meaning of Italian Legislative Decree231/2001.
Scope of application	It applies to the Parent Company Gefran S.p.A. and to other Italian companieswithin the Group.
Policy signing	Legal Representative, Employer, Legal and Corporate Affairs Department, Managerof the Prevention and Protection Office, General Services and Purchasing Office.
Policy ImplementationManager	Legal Representative, Employer, Legal and Corporate Affairs Department, Managerof the Prevention and Protection Office, General Services and Purchasing Office.
Reference standards	Italian Legislative Decree No. 231 of 2001 and the national regulations referred toby the documents mentioned in the Procedure.The reference internal regulations are the Group's Code of Ethics and Conduct
	as well as the Organisational and Control Model 231 adopted by Gefran.
Stakeholders concerned	It is intended mainly for supplier contractors.
Method of dissemination	It is disclosed through the internal company channels (the intranet).
Connected ESRS	S1 – Working conditionsS2 – Working conditionsG1– Business culture / Management of relationships with suppliers

The following paragraphs of this report highlight the links between the policies, procedures and regulations adopted by Gefran and the various sustainability issues that are relevant to the Gefran Group.

MDR-A Actions and resources in relation to material sustainability matters

The emergence of new risks, including the growing instability of the global geopolitical and economic scenario, as well as the rapid spread of new environmental and social sensitivities, have in recent years forced companies to undergo a transformation, with companies have been called upon to reconsider their longer-term strategies in addition to immediate response actions. Incorporating sustainability into business development plans has become an essential factor in maintaining competitiveness and laying the foundations for sustainable growth. Gefran intends to be an interpreter of sustainable growth, and attentive to the expectations of the market, people and companies with which it works, in the areas where it operates.

The principle of sustainability has historically guided Gefran's development and operational management, allowing the Group to grow steadily and gain strength over the years. In 2022, commitments were strengthened with a new Plan which, confirming the strategy announced in 2020 based on the United Nations Sustainable Development Goals, sets measurable targets consistent with the Industrial Plan.

The Strategic Sustainability Plan is an integral part of the Group's business model and its day-to-day activities. It revolves around four pillars, an expression of the company's DNA: centrality of people, contribution to the ecological transition, sustainable product innovation and sustainability of the supply chain.

Specific objectives have been defined for each pillar to be pursued through medium and long-term actions and projects.

The following paragraphs of this Report describe the actions implemented, in accordance with the sustainability strategy defined by the Group.

Metrics and targets

MDR-M Metrics in relation to material sustainability matters

Gefran has defined quantitative indicators related to significant ESG issues, which are periodically monitored through the timely collection of data from the various entities in the Group, their aggregation and analysis at the corporate level.

Quantitative indicators, calculated in accordance with ESRS standards, are described in the paragraphs of this Report. They are verified by the appointed External Auditor through the Limited Assurance process concerning the Sustainability Report. The conclusions of such process regarding compliance with the relevant legislation are provided at the end of this Report.

It should be noted that the metrics relating to material sustainability issues reported in this Report have not been validated by an external entity other than the Sustainability Auditor.

MDR-T Tracking effectiveness of policies and actions through targets

With the formalisation of the Strategic Sustainability Plan, measurable objectives have also been defined, as described in the paragraphs of this report covering the various topics. Their definition is the result of a process that began with the analysis of Gefran's positioning and the risk/opportunity framework of the reference market. Discussions were held with Stakeholders and the people working at Gefran were listened to, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management, at all levels of the Group, was involved to define the projects that will lead Gefran to achieve the set objectives, as well as to determine the key indicators (KPIs) and that will allow for monitoring the results over time.

The due recording of KPIs, at least on an annual basis, allows for the effectiveness of the actions taken to be measured and the progress made against the established targets to be measured.

The Sustainability Committee is periodically informed about the progress of the Plan, the execution of the several projects composing it and the monitoring of the defined performance indicators, in order to have all information needed to assess, if necessary, a possible evolution of the strategy.

The targets defined by the Group, pursued through the execution of the existing Plan, are reported and described in the paragraphs of this Report, in the light of their connection to the ESRS.

It should be noted that such targets were defined on the basis of internal analyses, without being supported by scientific data. The horizons are medium-term and target-specific; no intermediate targets have been formalised

Annual Financial Report at 31 december 2025 Gefran Group

INFORMATION PURSUANT TO THE EUROPEAN TAXONOMY REGULATION (EU REGULATION 2020/852)

ESRS E1 CLIMATE CHANGE

GOVERNANCE

ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes

STRATEGY

• E1-1 Transition plan for climate change mitigation
• ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

ESRS 2 IRO-1 Description of the processes to identify and assess material climate-related impacts, risks and opportunities

POLICIES

E1-2 Policies related to climate change mitigation and adaptation

ACTIONS

E1-3 Actions and resources in relation to climate change policies

METRICS AND TARGETS

• E1-4 Targets related to climate change mitigation and adaptation
• E1-5 Energy consumption and mix
• E1-6 Gross Scope 1, 2 and 3 and Total GHG emissions

ESRS E5 RESOURCE USE AND CIRCULAR ECONOMY

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

• ESRS 2 IRO-1 Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities
• E5-1 Policies related to resource use and circular economy
• E5-2 Actions and resources related to resource use and circular economy

METRICS AND TARGETS

E5-3 Targets related to resource use

and circular economy E5-4 Resource inflows E5-5 Resource outflows

Annual Financial Report at 31 december 2025 Gefran Group

INFORMATION PURSUANT TO THE EUROPEAN TAXONOMY REGULATION (EU REGULATION 2020/852)

To increase sensitivity to the effects of climate change, the European Union urges companies to assess the impact of its activities and define business strategies taking into account environmental and social variables. In order to guarantee transparency and comparability, criteria have been defined to establish the effective environmental sustainability of an economic activity, as included in the so-called EU Taxonomy (Regulation (EU) 2020/852, hereinafter the "Regulation"). The Regulation is the tool for identifying environmentally sustainable

economic activities, promoting the transition to less carbon-intensive activities and directing funding towards solutions tackling climate change.

In particular, an economic activity can be considered eligible for the purposes of the Regulation if it contributes in a concrete way to the achievement of at least one of the six defined objectives:

In addition, an economic activity is defined as aligned when, besides making a substantial contribution to at least one of the six objectives:

/ it contributes substantially to one or more of the six environmental and climate objectives (Article 9 of the

/ it does not significantly harm any of the other environmental objectives, in accordance with the "Do No

• Regulation);
• Significant Harm" principle (known as DNSH);

/ it is carried out in compliance with the minimum safeguards (referred to in Article 18 of the Regulation).

Article 8 of the Regulation defines the reporting obligations in the context of Taxonomy and clarifies that these requirements must be met by any undertaking which is subject to an obligation to publish the Sustainability Report pursuant to Article 19a or Article 29a of Directive 2013/34/EU.

Taxonomy requires information on how and to what extent an undertaking's activities are aligned with environmentally sustainable economic activities. In July 2021, EU Regulation 2021/2178 supplementing Article 8 of EU Regulation 2020/852 was published to further specify the content and presentation of these KPIs as well as the method to be followed for their measurement and the qualitative information accompanying their reporting. In 2023, this Regulation was amended by Annex V to Regulation 2023/2486, with specific reference to KPI reporting models. Finally, during 2025 and within the framework of the so-called Omnibus Package, the European Commission adopted a delegated act amending three delegated files of the Taxonomy, with the objective of reducing the complexity and administrative burden, while maintaining the integrity of the system.

To date, European laws require the indication of the extent of the alignment of economic activities with all 6 objectives. With regard to non-financial companies, the communication specifically concerns the following metrics (known as KPIs):

• / the proportion of revenues from products or services associated with environmentally sustainable economic activities;
• / the proportion of capital expenditure (CapEx) and of operating expenditure (OpEx) associated with environmentally sustainable economic activities.
• / This paragraph gives evidence of Gefran's activities related to the objectives set out above, through the proportion of turnover generated (Revenues), investments (CapEx) and operating costs (OpEx) for 2025. The following were considered:
• / revenues from the sale of goods and services to third parties by the Group in accordance with international accounting standards as set forth in the Group's Annual financial report;
• / investments made by the Group, as an increase in the historical cost of intangible assets, tangible assets and right-of-use assets, in accordance with international accounting standards as set forth in the Group's Annual financial report;

Annual Financial Report at 31 december 2025 Gefran Group

/ operating costs of the Group, understood as non-capitalized direct costs related to research and development, building renovation measures, shortterm leases, maintenance and repair as well as any other direct expenses related to the daily maintenance of property, plant and machinery, necessary to ensure the continuous and effective operation of these assets.

For the purpose of calculating the share of operating costs relating to eligible and aligned economic activities, repair and maintenance costs (including functional IT costs), research and development costs, personnel costs for repairs and maintenance, building renovation refurbishment measures, and shortterm rentals for the activities subject to reporting shall be taken into account.

To identify eligible and aligned activities, the Group carried out an analysis in different areas.

A preliminary analysis of the activities included in the scope was carried out (also following the statistical classification of economic activities of the European Union, NACE code) identifying, if any, the correlation with the activities declared eligible as indicated in the Delegate Act and the respective Annex. Subsequently, the characteristics of the activities described in the Regulations were considered and the relevance to the operational activities carried out by the Gefran Group companies was assessed.

As a result of the analysis and with reference to fiscal year 2025, the activities listed in the table below are considered to be aimed at Climate Change Mitigation (CCM) and Circular Economy (CE) objectives and suitable for taxonomy.

ID	Activity	Climatechangemitigation	Adaptationto climatechange	Water Pollution	Circular	economy Biodiversity
	Manufacture
	of electrical
CE 1.2	and electronic				X
	equipment
	Collection and
CE 2.3	transport of non				X
	hazardous and
	hazardous waste
	Provision of
CE 4.1	data-driven IT/OT				X
	solutions
	Repair,
CE 5.1	redevelopment				X
	and
	remanufacturing
	Installation,
CCM 7.3	maintenance and	X
	repair of energy
	efficiency devices
	Installation,
	maintenance
	and repair of
	instruments
	and devices
CCM 7.5	for measuring,	X
	adjusting and
	controlling
	the energy
	performance of
	buildings
	Installation,
	maintenance
CCM 7.6	and repair of	X
	renewable energy
	technologies

These activities recorded, with reference to the year 2025, the data shown

in the tables below.

	ANNUAL FINANCIALREPORT	HIGHLIGHTS	REPORT ON OPERATIONS –PROFILE OF THE GROUP

Fiscal year	2025					Breakdown by environmental objective of taxonomy-aligned activities
	Total	Proportionof taxonomyeligibleactivities	Taxonomyalignedactivities	Proportionof taxonomyalignedactivities	Climatechangemitigation	Adaptationto climatechange	Water	Circulareconomy		Pollution Biodiversity	Proportionof enablingactivity(E whereapplicable)	Proportionof transitionactivity(T whereapplicable)	Not evaluatedactivities,consideredas notrelevant	Taxonomyalignedactivities inthe previousfiscal year(2024)	Proportionof taxonomyalignedactivities inthe previousfiscal year(2024)
	(Euro /.000)	%	Euro/000	%	%	%	%	%	%	%	E	T	%	Euro/000	%
Revenues	137.711	92,4%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%				-	0,0%
CapEx	9.388	23,8%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%				-	0,0%
OpEx	2.254	35,2%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%				-	0,0%

KPIcommunicated RevenuesFiscal year	2025							Environmental objective of taxonomy-aligned activities
Economicactivities	Code	Taxonomyeligiblerevenues	Taxonomyalignedrevenues	Taxonomyalignedrevenues	Climatechangemitigation	Adaptationto climatechange	Water	Circulareconomy	Pollution	Biodiversity	Enablingactivity(E whereapplicable)	Transitionactivity(T whereapplicable)	Taxonomyalignedproportion ofthe taxonomyeligible total
		%	Euro/000	%	%	%	%	%	%	%	E	T	%
Manufactureof electricaland electronicequipment	CE 1.2	89,9%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Collection andtransport of nonhazardous andhazardous waste	CE 2.3	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Provision ofdata-driven IT/OTsolutions	CE 4.1	1,6%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Repair,redevelopment andremanufacturing	CE 5.1	0,4%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenance andrepair of energyefficiency devices	CCM 7.3	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofinstrumentsand devicesfor measuring,adjusting andcontrollingthe energyperformance ofbuildings	CCM 7.5	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofrenewable energytechnologies	CCM 7.6	0,5%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Alignment sumby objectiveTotal Revenues		92,4%	-	0,0%	0,0%0,0%	0,0%0,0%	0,0%0,0%	0,0%0,0%	0,0%0,0%	0,0%0,0%	0,0%	0,0%	0,0%

KPIcommunicated OpExFiscal year	2025							Environmental objective of taxonomy-aligned activities
Economicactivities	Code	Taxonomyeligible OpEx	Taxonomyaligned OpEx	Taxonomyaligned OpEx	Climate changemitigation	Adaptation toclimate change	Water	Circulareconomy	Pollution	Biodiversity	Enablingactivity(E whereapplicable)	Transitionactivity(T whereapplicable)	Taxonomyalignedproportion ofthe taxonomyeligible total
		%	Euro/000	%	%	%	%	%	%	%	E	T	%
Manufactureof electricaland electronic	CE 1.2	30,7%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
equipmentCollection andtransport of nonhazardous andhazardous waste	CE 2.3	1,5%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Provision ofdata-driven IT/OTsolutions	CE 4.1	2,7%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Repair,redevelopment andremanufacturing	CE 5.1	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenance andrepair of energyefficiency devices	CCM 7.3	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofinstrumentsand devicesfor measuring,adjusting andcontrollingthe energyperformance ofbuildings	CCM 7.5	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofrenewable energytechnologies	CCM 7.6	0,3%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Alignment sumby objective					0,0%	0,0%	0,0%	0,0%	0,0%	0,0%
Total OpEx		35,2%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%

KPIcommunicated CapExFiscal year	2025							Environmental objective of taxonomy-aligned activities
Economicactivities	Code	Taxonomyeligible CapEx	Taxonomyaligned CapEx	Taxonomyaligned CapEx	Climate changemitigation	Adaptation toclimate change	Water	Circulareconomy	Pollution	Biodiversity	Enablingactivity(E whereapplicable)	Transitionactivity(T whereapplicable)	Taxonomyalignedproportion ofthe taxonomyeligible total
		%	Euro/000	%	%	%	%	%	%	%	E	T	%
Manufactureof electricaland electronicequipment	CE 1.2	9,4%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Collection andtransport of nonhazardous andhazardous waste	CE 2.3	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Provision ofdata-driven IT/OTsolutions	CE 4.1	12,4%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Repair,redevelopment andremanufacturing	CE 5.1	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenance andrepair of energyefficiency devices	CCM 7.3	2,1%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofinstrumentsand devicesfor measuring,adjusting andcontrollingthe energyperformance ofbuildings	CCM 7.5	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Installation,maintenanceand repair ofrenewable energytechnologies	CCM 7.6	0,0%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%			0,0%
Alignment sumby objective					0,0%	0,0%	0,0%	0,0%	0,0%	0,0%
Total CapEx		23,8%	-	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%	0,0%

Annual Financial Report at 31 december 2025 Gefran Group

The analysis was carried out with the support of the R&D, Operations, Q-HSE functions, and the product portfolio, the investment plan as well as the details of operating expenses, connected with the activities as described in the Regulation, were verified.

With regard to eligible activities that contribute to the Circular Economy objective, the following are noted:

• / Manufacture of electrical and electronic equipment (CE 1.2): it refers to the production of sensors, instruments, static units, power controllers, programmable automation, as well as electrical panels; the revenues generated from the sale of these products (in 2025, 123,750 thousand Euro), investments and research and development costs necessary for their maintenance and evolution (in 2025, 879 thousand Euro and 2,050 thousand Euro, respectively) are considered eligible.
• / Collection and transport of non-hazardous and hazardous waste (CE 2.3): it refers to the activity of collecting separated waste, for which no investments were made in new equipment in 2025, while waste disposal costs were incurred (100 thousand Euro)
• / Provision of data-oriented IT/OT solutions (CE 4.1): it refers to the production of static units and power controllers with functionalities based on IT/ OT technology, to the new automation platform called G-Mation and to the new version of the Gefran development environment (GF Project) dedicated to it; the revenues generated from the sale of these products (in 2025, 2,254 thousand Euro), investments and the research and development costs necessary for their maintenance and evolution (in 2025, 1,162 thousand Euro and 181 thousand Euro, respectively) are considered eligible.
• / Repair, requalification and remanufacturing (CE 5.1): it refers to the activity carried out by the Company to repair out-of-warranty products; the revenues generated from the provision of this type of service are considered eligible (in 2025, 561 thousand Euro).

The activities that contribute to the climate change mitigation objective are:

• / Installation, maintenance and repair of energy efficiency devices (CCM 7.3): it refers to the renovation of systems, in favour of the efficiency of the buildings that house the work areas; investments that have concerned the installation of efficient lighting systems (LEDs), new heating and cooling systems (in 2025, a total of 197 thousand Euro was invested) are considered eligible.
• / Installation, maintenance and repair of instruments and devices for measuring, adjusting and controlling the energy performance of buildings (CCM 7.5): the Company uses this type of device (Datalogger) to monitor the energy performance of machinery and plants; no new installations have been carried out, however, maintenance costs have been incurred for existing ones (in 2025, 3 thousand Euro).

/ Installation, maintenance and repair of renewable energy technologies (CCM 7.6): it refers to the installation of photovoltaic systems at customers carried out by the Italian subsidiary Elettropiemme Srl, which also provides maintenance services; the revenues generated by this business (in 2025, 631 thousand Euro) and the maintenance costs for installed photovoltaic systems (in 2025, 18 thousand Euro) are considered eligible.

The analysis for the eligibility of the aforementioned activities is based on the interpretation of the legislation in force on the date of publication of this document. It is not certain that in the future the evolution of the legislation will allow us to continue to report these activities as admissible, and/or to expand the scope of alignment. To date, in fact, based on the analyses carried out, the characteristics of the activities identified as eligible for the Climate Change Mitigation objective and the Circular Economy objective do not fully comply with the technical criteria defined by the taxonomy for alignment purposes, and therefore none of them can be considered aligned.

In 2026, the analysis will continue, in order to implement possible evolutions of the legislation or of the technical characteristics of the activities carried out by the Group, with the ultimate objective of identifying possible activities eligible to date that are not accountable, and assessing the actual degree of alignment with the technical criteria of environmental sustainability of the taxonomy with respect to which to provide the necessary disclosure.

Governance

ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes

Strategy

E1-1 Transition plan for climate change

mitigation

One of the pillars of the Group's Strategic Sustainability Plan concerns the contribution to the ecological transition. Indeed, Gefran is involved in defining a decarbonisation strategy that involves various levers and the value chain. As part of this strategy, Gefran will define climate targets compatible with limiting global warming to 1.5 °C in line with the Paris Agreement, contributing in concrete terms to the transition to the NetZero 2050 scenario of the International Energy Agency (IEA) after the preliminary analyses.

Although the Group is engaged in a sustainability strategy through the execution of the Strategic Plan that includes projects and objectives also in the environmental field, it has not formally adopted a structured transition plan

for the time being. (E1-1 17)

The objectives defined by Gefran in the ESG area are the result of a process that began with an analysis of the Group's positioning and the general picture of the risks and opportunities of its reference market. Dialogue with Stakeholders and listening to Gefran employees provided management with the necessary support to identify areas of action, projects, targets and key indicators to monitor progress over time.

Understanding, disseminating and raising awareness of the importance of ESG issues are fundamental to business performance and the achievement of objectives. In order to strengthen this path, Gefran has integrated ESG objectives into its senior management remuneration policy, incorporating internal targets for reducing greenhouse gas (GHG) emissions into the Chief Executive Officer's incentive plans. The decarbonization path, included in the sustainability plan, involves corporate bodies, and in particular the Chief Executive Officer, calling for an in-depth study of the risks, opportunities, resources and technologies necessary to implement a coordinated plan aimed at reducing emissions related to climate change. The percentage of remuneration linked

to the implementation and progress of these plans in 2025 was set at 3% of total remuneration (of Directors and Statutory Auditors), in line with the percentage stated in 2024.

It should also be noted that the bonuses paid to Management directly involved in the execution of the Strategic Sustainability Plan are also considered ESG parameters. Specifically, in 2025, 50% of Italian managers included at least one ESG objective in the assessment of MBO and/or LTI (excluding executive figures as they are not directly involved in the Plan projects), for a total of 13.4% of the total allocated, and a total percentage of 95.3% of the objectives achieved (value of the MBO/LTI achieved on the total allocated value). In addition, a share (5.1% in 2025) of the performance premium for clerical staff and manual workers on supplementary contracts (Gefran S.p.A. and Gefran Soluzioni S.r.l.) was paid upon achievement of agreed ESG objectives.

(E1 ESRS 2 - GOV-3 13)

GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

As described in the paragraph General disclosures of this report, Gefran carried out the double materiality assessment in accordance with the requirements of the CSRD and with the involvement of all levels of the organisation. The assessment made it possible to highlight the material Impacts, Risks and Opportunities for Gefran, including its value chain, related to climate change. The IROs identified as material are reported below.

	PROFILE OF THE GROUP	REPORT ON OPERATIONS -INFORMATION ON ACTIVITIES	REPORT ON OPERATIONS –DISCLOSURE OF RISKSAND UNCERTAINTIES TO WHICHTHE GEFRAN GROUP IS EXPOSED	REPORT ON OPERATIONS –SUSTAINABILITY REPORT	CONSOLIDATEDFINANCIAL STATEMENTS
224				225
			LEGENDCurrent	Short term	Value chain-up
			Potential	Medium termLong term	Own operationsValue chain-downValue chain

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
CLIMATE CHANGEADAPTATION			The inadequacy of the Business Continuity Plan, including inthe event of catastrophic natural events related to climatechange, can cause inefficiency and the risk of interruptionsand loss of revenues
CLIMATE CHANGEMITIGATION	The consumption of energy from fossil sources(non-renewable) connected with the activitiescarried out by Gefran and/or its supply chain has animpact, contributing to climate change through theproduction and release into the atmosphere of GHGemissions (including CO2e)
ENERGY		Energy efficiency generated by the use of Gefranproducts allows for less consumption of resources,with a smaller impact on the environment

Energy efficiency generated by the use of Gefran products is a factor that increases their attractiveness on the market, representing an opportunity to increase Gefran's competitiveness

Energy efficiency of plants and processes, generated by the Group's planned investments, represents an opportunity to reduce energy costs

(E1 ESRS 2 - SBM-3 19 b)

Climate risks

In addition, in the fourth quarter of 2024 the Group carried out an initial analysis that considered the physical climate risks arising from the most recurring extreme weather conditions as well as transition ones, linked to regulations, the market, the technological and reputational context. The analysis, aimed at understanding their possible impact on the development of Gefran's business, took into account different internationally recognised climate scenarios developed by the Intergovernmental Panel on Climate Change (IPCC).

Climate risks were assessed through an integrated and across-the-board approach, involving the competent functions to ensure an in-depth analysis of all potential economic and financial impacts. Methods were also adopted for identifying, measuring and monitoring climate risks, considering mediumto long-term scenarios and integrating these assessments into decision-making and strategic processes. The aim was to highlight any priorities to be implemented in the development of a strategy that would be resilient and adaptable to different climate and market environments.

The process enabled the identification of physical and transition risks among the risks arising as material from the double materiality assessment: the risk of inefficiencies, interruptions and loss of revenues due to the inadequacy of the Business Continuity Plan, including in case of catastrophic natural events related to climate change (as a physical risk), as well as the risk of unavailability of materials or extra costs, due to the criticality of the supply chain due to the allocation phenomenon, geopolitical tensions, or other issues (as a transition risk).

Impact, risk and opportunity management

ESRS 2 IRO-1 Description of the processes to identify and assess material climate-related impacts, risks and opportunities

Gefran has always paid attention to environmental aspects, including the impact of risks and opportunities that may arise from its activities, with an eye on the

value chain.

The processes for identifying significant IROs, including those related to climate change, involve all levels of the organisation, as described in the section General disclosures - Impact, Risk and Opportunity Management – Materiality Assessment Process, IRO-1 of this Report.

In addition to the double materiality assessment and acknowledging the importance of incorporating this type of assessment into its business strategy, in the fourth quarter of 2024 Gefran conducted an initial assessment of all physical and transition climate risks, for the purpose of ensuring the resilience of its assets and the sustainability of its activities in the short, medium and long term.

The assessment considered the Company's production sites, sales offices and main suppliers, based on the various scenarios in the short, medium and long term.

There is no evidence of changes in the context that may significantly affect the conclusions of the analysis carried out in the fourth quarter of 2024, which is therefore considered representative of the current situation.

Physical risks:

Acute physical climate risks such as storms, forest fires and river flooding were taken into account, calculating the Business Interruption Days (BIDs). The latter represent the duration of a possible interruption of business activities without taking into account direct damage to assets. The BIDs assess the possibility that exogenous events, such as the interruption of the electrical network or local roads linked to extreme climatic events, might result in downtime. In conducting this assessment, reference was made to various climate scenarios developed by international organisations such as the Intergovernmental Panel on Climate Change (IPCC) defined through the Representative Concentration Pathways (RCPs), which outline possible developments in greenhouse gas emissions and the corresponding global warming levels. The assessment considered three time horizons:

/ The RCP 8.5 scenario is the most extreme among the RCP scenarios. It provides for an increase of more than 4°C by 2100 and is expected to be achieved if no mitigation policy is adopted. High economic and demographic growth rates (described in the Shared

Socioeconomic Pathway 5, SSP5) support this scenario, triggering most so-called climatic "no-return points" with difficult-to-model consequences.

• / The RCP 4.5 scenario is considered more likely given the current commitments of several countries. It foresees an increase in temperature between 2 and 3°C by 2100, well beyond the limits of the 2015 Paris Agreement and the Kyoto Protocol. Considering the current commitments of several countries, it is considered likely that 2.5°C will be reached by 2100.
• / The RCP 2.6 scenario is in line with the Paris/Kyoto agreements (less than 1.5°C by 2100) and includes strong reduction efforts by all countries around the world. Cumulative greenhouse gas emissions from 2010 to 2100 must be reduced by 70%, requiring substantial changes in energy use and greenhouse gas emissions other than carbon dioxide (CO2), such as methane (CH4), nitrous oxide (N2O), sulphur hexafluoride (SF6) and other fluorinated gases. Although these gases have lower concentrations than CO2, they have a very high Global Warming Potential (GWP).

(E1 ESRS 2 - SBM-3, 18)

Bearing in mind that the threshold used to determine the significance of a risk was the same as that used in the ERM process, as in the double materiality assessment (represented by the ratio between revenues and EBIT), the analysis showed that Gefran is not particularly exposed to physical and transition climate risks. With regard to exposure to transition climate risks, the Group is not particularly exposed for the time being; however, it continues to monitor regulatory developments, with particular attention to the EU Emissions Trading System 2 (ETS2) and to the Ecodesign for Sustainable Products Regulation (ESPR).

It should be noted that, in light of the recent amendments to the Carbon Border Adjustment Mechanism (CBAM) and with particular reference to the introduction of the single exemption threshold, Gefran is no longer subject to the obligations established in the regulation in question, as the flows managed thereby are largely within the established limits.

There is no evidence of further changes in the context that may significantly affect the conclusions of the analysis carried out in the fourth quarter of 2024, which is therefore considered representative of the current situation.

(E1 ESRS 2 - SBM-3 19 a, b, c) (E1 ESRS 2 AR 7)

Annual Financial Report at 31 december 2025 Gefran Group

Transition risks:

The Group is committed to the ongoing ecological transition through the implementation of the Strategic Sustainability Plan, which includes objectives on environmental and social issues. Moreover, it has identified its activities eligible for the European Taxonomy; therefore, it has no assets and business activities that are incompatible with the transition to a climate-neutral economy.

The assessment of climate transition risks includes four broad categories: political and regulatory risks, technological risks, market risks, and reputational risks.

In conducting this assessment, reference was made to several climate scenarios developed by international organisations such as the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA). For the latter, the scenarios considered for the Group's assessment included: NetZero 2050, Aps (Announced Pledges Scenario) and Steps (Stated Policies Scenario) providing an evolutionary picture of market conditions and possible decarbonisation trajectories.

The identification of transition climate risks and opportunities included an initial screening phase as a result of which the specific challenges of the sector in which each Group company operates were identified. This assessment took into account not only the type of business, but also market dynamics, emerging trends and current regulations. In particular, the main European regulations, international frameworks and guidelines issued by reference institutions were consulted to identify the transition risks of the Gefran Group. These include EU regulations and directives, such as the European Green Deal and the EU Taxonomy for Sustainable Activities, as well as global standards such as those set out by the TCFD and the Paris Agreement. The assessment also took into account best practices adopted by global organisations and recommendations arising from sectoral and scientific reports.

The main transition risks identified by Gefran were increased costs for industrial decarbonisation (CBAM and ETS2) and the possible scarcity of raw materials, resulting in delays in the supply chain. Currently, among the various transition risks mapped, there is no risk that is regarded as having an impact over the long term. (E1 ESRS 2 - IRO-1 20 a, b, c, 21)

Policies

E1-2 Policies related to climate change mitigation

and adaptation

(E1-2, 24, 25) (MDR-P 65 a)

Gefran undertakes to comply with environmental laws and to manage its activities according to the highest international standards and the principles

of continuous improvement.

The path towards an Integrated Management System (IMS) involved obtaining the environmental certification for all the Group's production plants. The project, launched in 2021 and led by the integrated Q-HSE function, saw in 2023 the achievement of environmental certification according to the ISO 14001:2015 standard for all the Group's Italian companies in which there is the greatest concentration of processes and people. It continued in 2024 and 2025 with a focus on the production plants in Switzerland, the United States and China, allowing for third-party audits to be carried out and achieving the target set, obtaining the certification in question also for the foreign production sites (audits were carried out in December 2025 and January 2026).

Gefran has adopted a Health, Safety and Environment Policy, with which it declares its commitments and sets out the guidelines that Group Companies must follow in managing HSE issues, dealing with climate change, environmental protection and the optimisation of energy resources (for the time being, it does not include a specific reference to the development of renewable energy). It aims to harmonise environmental management, prevent damage, optimise energy consumption, responsibly manage the supply chain and provide adequate training.

The Health, Safety and Environment Policy, published on the Company's website and also intended for external Stakeholders, is illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P included in the section General disclosures of this Report.

230 231

Annual Financial Report at 31 december 2025 Gefran Group

Actions

E1-3 Actions and resources in relation to climate change policies

In general, the actions implemented by Gefran are part of the Group's longterm strategy and are aimed, in the area of climate change, at mitigating the risks of material negative impacts as well as at strengthening positive impacts and pursuing opportunities.

With the aim of defining the priority of intervention and directing actions aimed at optimising energy consumption, Gefran monitors and oversees the most sensitive aspects of its industrial activity for its impact on the environment, in particular for the production of atmospheric emissions contributing to climate change.

Regular data on energy consumption are collected, which feed the annual calculation of the carbon footprint, including CO2e emissions generated by Gefran processes (Scope 1 and 2) and its chain (Scope 3). The model implemented, in accordance with the GHG Protocol, is based on the inventory of relevant emission categories and on the collection and processing of specific data, as well as on the application of conversion factors drawn from public sources.

During 2025, data collection and management processes were further enhanced, particularly for the calculation of Scope 3 emissions, also by developing tools and a dedicated digital platform.

The database generated, consisting of the emissions calculated since 2022, allows for the monitoring and historical analysis of the main emission categories and highlights the processes with the highest emissions (so-called hotspots), such as air transport and the purchase of specific product categories. Gefran has involved its suppliers with the aim of reducing its carbon impact and has taken several steps, such as signing contracts with freight forwarders for the use of SAF (Sustainable Aviation Fuel).

The actions in place are focused on the following macro categories of levers:

• / Energy efficiency of plants;
• / Use of energy from renewable sources;
• / Sustainable product innovation, which aims to offer more efficient products;
• / Supply chain involvement in the decarbonisation path.

Historical monitoring data indicate that although Gefran is not an energy-intensive company, as about half of its energy consumption is electricity. Energy audits, carried out in its main plants, show that the Group's greatest consumption comes from production machinery, cold and ventilation circuits and lighting. Gefran has thus planned and launched actions to reduce the use of resources, improve efficiency and promote renewable energy.

Since 2011, resources have been invested (in total about 1.6 million Euro) to build photovoltaic plants dedicated to the production of solar energy (with a total power of 888 kWp today), which serve the plants in Provaglio d'Iseo and two of the main European plants.

The table below shows the contribution of photovoltaic production and renewable energy to electricity requirements, expressed as the potential reduction in emissions compared with the average grid electricity mix8, thanks to production from photovoltaic systems installed in the plants and the purchase of electricity from certified renewable sources.

Potential reduction in emissions compared with the average grid electricity mix

Yield of PV systems (in MWh) Electricity purchased from the grid, from certified renewable sources (in MWh)

Unit ofmeasurement	2024	2025	Change2025-2024
	781	842	7.8%
MWh	3,941	3,930	-0.3%
tCO2eq	1,214	1,015	-16.4%

Potential reduction in emissions compared with the average grid electricity mix (in tCO2e)

The search for areas potentially capable of increasing the Group's photovoltaic park in order to improve energy performance (reduction in the consumption of energy taken from the grid and ensuing reduction in CO2 emitted) is ongoing and has guided the most recent investments, such as the one that in 2023 that involved the construction, exploiting the synergy with its subsidiary Elettropiemme S.r.l., of a plant covering the employee parking lot at the Group's historical headquarters and the Operation area of the automation components business.

Along with the installation of solar energy production plants, in the same locations Gefran invests in the installation of charging stations for electric vehicles (28 thousand Euro in 2023, 30 thousand Euro in 2024 and 55 thousand Euro planned) and, where useful, in excess energy storage systems (18 thousand Euro in 2024).

Gefran's constant attention is focused on the efficiency of the production

of CO2e/KWh (International Energy Agengy 2022 data)

(E1-3 29 a)

8 The location-based approach was used for calculation purposes, with country-specific conversion factors

232 233

plants and buildings that house the Group's activities. Numerous interventions, carried out over the years and planned for the future, are aimed at implementing more efficient solutions: timely monitoring of the energy consumption of machinery to optimize maintenance activities and, if necessary, to plan its replacement, installation of LED lighting fixtures, as well as the evaluation of energy performance in the property adaptation plan (506 thousand Euro in 2023, 305 thousand Euro in 2024, 197 thousand Euro in 2025 and 317 thousand Euro planned in 2026).

In 2025, the building housing the Gefran Benelux headquarters was also made more efficient, and is now heated by green electricity, produced using the photovoltaic system or purchased with a guarantee of origin, allowing for a reduction in the emissions produced (estimated at 2.96 t of CO2e compared to 2024).

It is added that during 2023, in accordance with current regulations, a new energy diagnosis was also carried out by a specialized company involving the plants of the Parent Company Gefran S.p.A., and the company system was evaluated in detail and in terms of consumption of the various energy carriers. Compared to the previous diagnosis, carried out in 2019, there was a significant improvement in the Company's most efficient energy performance, above all possible thanks to investments in machinery for the production areas and in installations to support plants. A new analysis is planned for 2027, based on the spot measurements that will be recorded during 2026.

To date, all plants in Italy and the main European branches (Benelux, Germany, Switzerland) consume green energy, partly produced by the various photovoltaic systems installed, partly purchased with a guarantee of origin, thanks to the signing of contracts for the supply of certified renewable electricity. The action will continue by focusing on the branches in America (USA and Brazil), for which feasibility analyses are under way. Other branches for which electricity consumption is insignificant (France, the UK and Singapore, which together account for 0.4% of the electricity consumed in the Group), as well as areas in which there is no access to certified renewable sources (India, which accounts for 0.7% of the electricity consumed in the Group in 2025, and China, whose share weighs 8.6% of the entire Group in 2025) remain excluded from the scope.

In line with the 2030 Agenda's sustainable development objective 17, various initiatives launched by Gefran in collaboration with some partners have been adopted. The following examples are given:

• / the use of technologically innovative equipment which, depending on its use, allows for a reduction in emissions produced compared to equipment with standard energy performance;
• / the review of employee break-in areas in all of the Group's Italian locations, in order to reduce the use of single-use plastic, also by installing water dispensers.

Other initiatives launched concern mobility, for which projects have been planned to reduce the environmental impact of the Company's fleet of vehicles and air travel. During 2025, the car policy was renewed, formally introducing the allocation, based on usage, of cars with a lower environmental impact (petrol, hybrid and electric vehicles) compared to the previous standard (diesel vehicles only), and the monitoring of the relevant KPIs was set up. Thanks to the initial actions taken, 25% of the company fleet as at 31 December 2025 (a total of 174 vehicles throughout the Group) are full electric- or hybrid-powered.

With regard to innovation aimed at generating energy efficiency, representing also an opportunity for Gefran, the product development roadmap, across the two business areas (Sensors and Automation components), has taken the shape of three main lines of action:

• / development of a range of static units equipped with IO-Link and Modbus connectivity, also able to digitalise the deepest components of the machinery and extract the data needed to increase process efficiency;
• / evolution of the multivariate sensor portfolio, i.e., able to reconstruct the three-dimensional movement of a machine element, in order to more accurately predict any malfunctions and contribute to improving cycle efficiency;
• / development of the automation portfolio, starting from input/output modules, aimed at developing applications for the control of automatic machines that allow better energy performance and greater use of recycled raw materials.

Although Gefran has carried out the various actions described above, quantitative metrics have not yet been defined to highlight the benefits both in terms of the energy efficiency generated, since these are subject to ungovernable variables and exogenous factors (such as the scope of application, the degree of use, the planning and execution of a proper maintenance schedule, …), and in terms of emission reduction.

The value chain, and Gefran's suppliers in particular, are actively involved in the process of achieving the declared targets, through a process, launched in 2020, aimed at disseminating the culture of sustainability: sharing ethical values and principles with the components of the supply chain is a requirement that Gefran regards as crucial for achieving its targets. The process has been progressively consolidated, paying special attention to reducing emissions, through a declaration of commitment and the implementation of concrete projects. Today, the suppliers involved in this process accurately track their Scope 1 and 2 emissions, allowing the Group to measure the carbon footprint more accurately. With a view to contributing to mitigating the impact on climate change under way, thanks in part to the methodological support provided by the Gefran Procurement area, suppliers have consolidated the measures launched with the aim of increasing the efficiency of their plants and processes in various areas according to their type of activity and organisation: plant efficiency, renewable energy, transport, packaging or other specific projects. All the projects carried out have been collected in the Ideas Box, a digital network for sharing experiences among the members of the panel, which stimulates the generation of initiatives with generally positive repercussions.

For an overview of the Group's targets set out in its Strategic Sustainability Plan, please refer to the paragraphs E1-4 Targets related to climate change mitigation and adaptation and E5-3 Targets related to resource use and circular economy included in the section Environmental Information of this Report. (E1-3 29 b)

For details of activities and KPIs (Revenues, CapEx, OpEx), referring to the first two objectives described by the Taxonomy Regulation, related to climate change, please refer to the section Environmental information - Disclosure pursuant to Art. 8 of EU Regulation 2020/852 of this Report. (E1-3 29 c)

Annual Financial Report at 31 december 2025 Gefran Group

Metrics and targets

E1-4 Targets related to climate change mitigation and adaptation

In order to mitigate climate change and its impacts on the environment, quality of life and economic activities, it is crucial to pursue the ecological transition. A key objective is decarbonisation, i.e. progressively reducing and neutralising CO2emissions. Gefran addresses these challenges by engaging the entire value chain, from its suppliers to its customers. The 2022 Strategic Sustainability Plan, an integral part of the strategy launched, focuses on the ecological transition through several planned actions and projects, drawing on the objectives of the 2030 Agenda.

The process began by analysing Gefran's positioning and the risks/opportuni ties of the market. Discussions were held with Stakeholders, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management partic ipated at all levels to define projects, set objectives and determine perfor mance indicators. We then verified the consistency of the targets with the relevant IROs, ensuring the coverage of each important topic. Stakeholders were involved in identifying the relevant impacts, risks and opportunities.

The constant mapping of CO2e emissions has enabled the Group to obtain a complete view of its carbon footprint, highlighting the areas and catego ries with the greatest impact (so-called hotspots). Thanks to this first step, Gefran, although not yet having a formal transition plan (as described in paragraph E1-1), is committed to defining actions and projects with a medi um-long term roadmap in order to pursue a decarbonisation strategy, with a first goal of neutralising 25% of CO2e total emissions by 2030 com pared to 2022, partly also through offsetting activities, which to date have not been implemented (the potential share of which is currently not defined).

With regard to Gefran's own processes, and in particular to electricity, the current objective is to use energy from certified renewable sources (for at least 85% of consumption at Group level and by 2030), also through the signing of contracts for the purchase of certified renewable energy, where available.

In addition to plant energy efficiency, a further strategic lever is product inno vation, aimed at generating efficiency in end-user processes. Currently, the activities carried out in the field of Innovation and Research & Development have enriched Gefran products with innovative inherent features regarding condition monitoring and/or energy performance, thus favouring more effi cient processes.

For the initiatives undertaken regarding mobility (projects aimed at reducing the environmental impact of the fleet of company vehicles and air travel), the monitoring of the relevant KPIs has been set up; however, no quantitative targets have yet been defined.

In general, periodic monitoring of key indicators makes it possible to verify the effectiveness of actions and to highlight progress over time. Below are the projects envisaged in the Strategic Sustainability Plan, in relation to climate change, the targets 9 defined and the progress achieved in 2025.

Projects	Targets	Progress made in 2025
Map emissions	Develop a carbon footprint manage-ment model to collect and calculateScope 1, 2 and 3 data and replicate itannually.	Completed in 2023. In 2025, the modelwas streamlined (data collection andcalculation phases), in order to make iteasier to replicate and more specific.
Develop a decarbonisationstrategy	Identify and implement the initiativesto reduce CO2e emissions (takinginto account regulatory, economic,technological and market contexts)estimating the impact of the initiativesin relation to the levers activated, withthe aim of neutralising 25% of totalCO2e emissions by 2030 and com-pared to 2022.	Analysis of the most impacting pro-cesses and categories has enabledsome specific work areas to be iden-tified, for which feasibility checks arebeing carried out.
Use electricity from certifiedrenewable sources	Ensure 85% of energy used by all Groupcompanies is from certified renewablesources* by 2030 and compared to 2021.* Target year aligned with the general objective ofreducing the carbon impact, revised in the light ofthe actions already implemented and the policies putin place by the countries in which the Group has itsoperating sites	83% of the electricity consumed atthe Group's plants derives from certi-fied renewable sources (it was 82.5%in 2024 and 82.4% in 2023).
Reduce the environmentalimpact of the fleet	Introduce vehicles with a reducedenvironmental impact in the companyfleet by 2029	The new policy governing the allocationof fleet vehicles to different companydepartments has been defined, includ-ing the introduction of hybrid and fullelectric vehicles. 25.3% of the 2025fleet consists of lower-impact vehiclescompared to the standard (conventionaldiesel-powered internal-combustionvehicles).
Use airlines with sustainablepolicies	Reach 70% of air travel by 2028 withcompanies that have implementedsustainability policies.	61.9% of miles are flown with airlinespursuing sustainability policies (76% in2024).
9by scientific data.	Gefran's sustainability targets are defined on the basis of internal considerations, without being supported	(E1-4 32, 33, 34 b, c, e, f) (ESRS 2MDR-A 68 a, b, c, e) (ESRS 2 MDR-T80 a, b, c, d, e, f, g, h, i, j)

236 237

E1-5 Energy consumption and mix

The reporting of data on energy consumption and GHG emissions was carried out involving all Gefran Group companies in the collection of accurate data, as described in the specific Procedure governing this Report (Procedure for Preparing the Sustainability Report, approved by the Board of Directors on 13 February 2025). It should be noted that the scope used for 2025 reporting is different from that used for the previous year, due to the entry into the Group of CZ Elettronica S.r.l., as described in Significant events in 2025.

The data collected by each entity are aggregated and analysed by the Corporate contacts for climate change-related issues (typically the Q-HSE function). When exposing energy consumption in MWh, we used the conversion factors published by the Department for Environment, Food & Rural Affairs (DEFRA) through the UK Government GHG Conversion Factors for Company Reporting 2025.

Finally, it should be noted that the metrics reported below have not been validated by an external entity other than the Sustainability Auditor.

The table below shows the Group's total energy consumption for the current year, compared with the same for the previous year. It should be noted that the 2025 figure reflects the expansion of the reporting scope, due to the acquisition of CZ Elettronica S.r.l., without which the increase in energy consumption in 2025 compared to 2024 would be more limited (+1.5%). As described in Significant events in 2025, CZ Elettronica S.r.l. joined the Gefran Group in April 2025; accordingly, energy consumption for the period April– December (a total of 62 MWh) is reported and included.

Energy consumption and mix	Unit ofmeasurement	2024	2025	Change2025-2024
Fuel consumption from coal and coal products		-	-	n.a.
Fuel consumption from crude oil and petroleum products		2,523	2,489	-1.4%
Fuel consumption from natural gas		2,285	2,523	10.4%
Fuel consumption from other fossil sources	MWh	-	-	n.a.
Consumption of purchased or acquired electricity, heat,
steam, and cooling from fossil sources		966	943	-2.4%
Total fossil energy consumption		5,775	5,955	3.1%
Share of fossil sources in total energy consumption	%	55.9%	56.4%	1.0%
Consumption from nuclear sources	MWh	-	-	n.a.
Share of consumption from nuclear sources in total
energy consumption	%	0.0%	0.0%	n.a.
Fuel consumption for renewable sources		-	-	n.a.
Consumption of electricity, heat, steam and cooling from
renewable sources, purchased or acquired from non		-	-	n.a.
certified sources
Consumption of electricity, heat, steam and cooling from
renewable sources, purchased or acquired from certified	MWh	3,941	3,930	-0.3%
sources
Consumption of self-generated non-fuel renewable
energy		616	665	7.9%
Total energy consumption from renewable
sources		4,557	4,596	0.8%
Share of renewable sources in total energy consumption	%	44.1%	43.6%	-1.3%
Total energy consumption	MWh	10,332	10,550	2.1%

With regard to composition, 56.4% of consumption comes from fossil sources (55.9% in 2024), of which a share for the use of fuels required for the company fleet (23.6% of the total), a share for the consumption of natural gas for the heating of working environments (23.9% of the total) and to a lesser extent (8.9% of total consumption) for electricity, consumed mainly in the Group's non-European offices. The remaining 43.6% of energy consumption comes from renewable energy sources, partly linked to electricity purchased with certifications of origin (37.3% of total consumption) and partly produced thanks to photovoltaic systems in the various plants, in Italy and abroad (6.3% of total consumption).

Annual Financial Report at 31 december 2025 Gefran Group

The production of energy from renewable sources in 2025 increased by 7.8% compared to 2024, as shown in the table below. It should also be noted that the figure improved considerably compared to 2023 (374 MWh), thanks to the benefits brought about by the investments completed during 2023, and in particular by the photovoltaic park installed over the employees' car park at the site housing the Headquarter and the Operations area of the automation components business.

Total energy production	Unit ofmeasurement	2024	2025	Change2025-2024
Non-renewable energy production		-	-	n.a.
Renewable energy production	MWh	781	842	7.8%
Total energy production		781	842	7.8%

Gefran operates in the manufacturing sector and generates revenues from the sale of industrial sensors and automation components, which are considered to be high climate impact sectors.

Energy intensityassociated with activitiesin high climate impactsectors	Unit ofmeasurement	2024	2025	Change2025-2024
Total energy consumption fromactivities in high climate impactsectors	MWh	10,332	10,550	2.1%
Net revenue from activities in highclimate impact sectors	€	132,607,000	138,964,000	4.8%
Energy intensity associated withactivities in high climate impactsectors	MWh/€	0.0078%	0.0076%	-2.6%

The energy intensity indicator associated with these activities is 0.0076% (down 2.6% compared to 2024, or 0.0078%). In the calculation, revenues for the fiscal year from the sensors and automation components business areas are used as the denominator, as reported in paragraph Results by business area, included in the Report on Operations; they relate to the items "Revenues from product sales" and "Other revenues and income" reported in the Statement of profit/(loss) for the year of the consolidated financial statements and in the relevant Specific explanatory notes to the accounts.

Annual Financial Report at 31 december 2025 Gefran Group

The electricity consumed, which overall accounts for more than half of its total energy consumption (52.5% in 2025), is mainly used in production processes, in the cooling and ventilation circuits and for lighting of the workspace. A share of this (about 12%) is self-produced by the photovoltaic systems installed in the Group's plants.

Self-generated non-fuelrenewable energy	Unit ofmeasurement	2024	2025	Change2025-2024
Consumption of self-generatednon-fuel renewable energy	MWh	616	665	7.9%

The remaining portion (about 88%) is purchased from different sources as shown below.

Purchased or acquiredelectricity	Unit ofmeasurement	2024	2025	Change2025-2024
TOTAL consumption of
purchased or acquired	MWh	4,907	4,874	-0.7%
electricity
from other non-renewable
sources	MWh	966	943	-2.4%
from other certified renewable
sources
	MWh	3,941	3,930	-0.3%

Fuel consumption is the second-largest type of consumption, accounting for 23.6% of total energy consumption. This mainly derives from diesel and gasoline for company vehicles; diesel for other uses is used to fuel fire-fighting pumps and emergency generators.

Crude oil and petroleumproducts	Unit ofmeasurement	2024	2025	Change2025-2024
TOTAL fuel consumption
from crude oil and petroleum	MWh	2,523	2,489	-1.4%
products
Diesel (other uses)	MWh	6	9	43.4%
Diesel (company fleet)	MWh	1,864	1,724	-7.5%
Gasoline (company fleet)	MWh	653	757	15.8%

Natural gas, the third largest source of energy used in the Group (23.9% in 2025), is not used in the production process. Consumption is therefore for

heating of the workplace.

Natural gas	Unit ofmeasurement	2024	2025	Change2025-2024
TOTAL fuel consumption fromnatural gas	MWh	2,285	2,523	10.4%
Natural gas	MWh	2,285	2,523	10.4%

INDIRECT ENERGY 46%

In analysing the Group's activities and the energy consumption associated with them, Gefran takes into consideration direct consumption of energy:

• / the use of fuels for company vehicles and for emergency generator units which only come into operation in the event of a blackout;
• / the electricity self-generated by photovoltaic systems installed on the rooftops of factories and used for the operation of systems;
• / the natural gas purchased and used for heating workplaces.

The indirect energy consumption refers to electricity from the grid, used

mainly in offices.

Annual Financial Report at 31 december 2025 Gefran Group

Direct and indirect energyconsumption	Unit ofmeasurement	2024	2025	Change2025-2024
Total energy consumption	MWh	10,332	10,550	2.1%
Direct energy consumption	MWh	5,425	5,677	4.6%
Crude oil and petroleum products		2,523	2,489	-1.4%
Natural gas	MWh	2,285	2,523	10.4%
Self-generated renewable energy		616	665	7.9%
Indirect energy consumption	MWh	4,907	4,874	-0.7%
Electricity purchased from nonrenewable sources		966	943	-2.4%
Electricity purchased fromrenewable sources	MWh	3,941	3,930	-0.3%

E1-6 Gross Scope 1, 2, 3 and Total GHG emissions

Greenhouse gas emissions, in accordance with the GHG Protocol, were calculated on the basis of the energy consumption data collected, attributable to the various sources used (electricity from fossil and renewable sources, natural gas, diesel and gasoline for company vehicles) and for use, applying recognised emission factors for calculation purposes. The databases used for emission factors were selected based on their current and accuracy, responding to the specific peculiarities of the resources used within the Group.

All the entities included within the scope of this Report fall within the scope of consolidation relating to the financial statements and therefore there are no entities under the sole operational control of the Company. In addition, it should be noted that the Group does not use regulated emissions trading systems.

The assessment took into account the main gases listed in the GHG Protocol (CO₂, CH₄, N₂O, HFCs, PFCs, SF₆, NF₃). The conversion to CO₂e takes place via Global Warming Potential (GWP) values with a 100-year horizon, published by the IPCC AR6. Emissions are expressed in CO₂e, a unit of measurement of the global warming potential of greenhouse gases, calculated as the heating power of a unit of gas compared to that of carbon dioxide. No carbon credits purchased, sold or transferred or any offsetting mechanisms adopted by Gefran were considered in the calculation of emissions. It should be noted that the Group's activities do not include biogenic CO₂ emissions.

The tables reporting Scope 1-2-3 emissions are shown below, with the specification that the metrics reported herein have not been validated by an external entity other than the Sustainability Auditor.

Direct and indirect emissions (Scope 1 and 2)

With regard to Scope 1, emissions refer to energy consumption from sources owned or controlled by the Group (mainly vehicle fuels and natural gas for heating work environments). For emission factors, reference is made to the DEFRA 2025 database (https://www.gov.uk/government/publications/ greenhouse-gas-reporting-conversion-factors-2025).

Scope 2 emissions derive from electricity purchased and consumed by the Group. The calculation is carried out using a twofold methodology:

/ the location-based method, which takes into account the average intensity of GHG emissions of the geolocated networks in which energy consumption takes place, and is based on the emission factors published by the International Energy Agency, in their "2024 Provisional data" version

(E1-5 37, 38, 39, 40, 41, 42, 43)

/ the market-based method, taking into account the different forms of supply that the Group has chosen, where the energy generation method is certified; the "residual mix" parameter was used in the calculation where the organisation's emissions intensity level is not specified in the signed contracts; for countries where the "residual mix" reference benchmark is not available (particularly China, Brazil, India, and Singapore), location-based conversion factors are applied.

Gross Scope 1 GHG emissions	Unit ofmeasurement	2024	2025	Change2025-2024
Gross Scope 1 GHG emissions		1,139	1,184	3.9%
Scope 1 GHG emissions covered
by regulated emissions trading	tCO2eq	-	-	n.a.
systems
Percentage of Scope 1 GHG
emissions covered by regulated	%	0.0%	0.0%	n.a.
emissions trading systems

Scope 1 emissions, calculated for fiscal year 2025, increased by 3.9% compared to fiscal year 2024, partly due to the expansion of the reporting scope determined by CZ Elettronica S.r.l. joining the Group (approximately 2.9% of the increase), as well as to the update of emission factors (approximately 0.5% of the increase).

Gross Scope 2 GHG emissions	Unit ofmeasurement	2024	2025	Change2025-2024
Gross location-based Scope 2GHG emissions		1,455	1,244	-14.5%
Gross market-based Scope 2 GHGemissions	tCO2eq	442	414	-6.3%

In 2025 there was a decrease, compared with the previous fiscal year, in Scope 2 emissions, calculated both with reference to the country's energy mix (location-based method) and taking into account energy purchase contracts (market-based method). The 2025 figure reflects the expansion of the scope described above, net of which the reduction would be more significant (-14.5% location-based and -6.3% market-based).

(E1-6, AR 39 b)

Information on types of contractual instruments, Scope 2 GHG emissions

Information on types ofcontractual instruments,Scope 2 GHG emissions	Unit ofmeasurement	2024	2025	Change2025-2024
Energy from Guarantees of Origin		69.7%	67.1%	-3.7%
Energy from Power PurchasingAgreement		0.0%	0.0%	n.a.
Energy from specific contractswith the electricity supplier,where the energy mix provided iscontractualised	%	0.0%	0.0%	n.a.
Energy from specific contractswith the electricity supplier, wherethe energy mix provided is NOTcontractualised.		30.3%	32.9%	8.5%

Other indirect emissions (Scope 3)

SCOPE OF REPORTING

The Gefran Group reports Scope 1, Scope 2 and Scope 3 gross greenhouse gas (GHG) emissions in accordance with the Greenhouse Gas Protocol (GHG

Protocol) and ESRS E1 requirements.

The reporting scope for Scope 3 is consistent with the Group's consolidation scope, in line with ESRS requirements. The assessment covers the entire Gefran Group and is carried out every year, considering the relevant flows and activities along its upstream and downstream value chain in the relevant period.

The Scope 3 assessment allows the Gefran Group to identify the main areas of impact along its value chain (hotspots) and is the basis for defining and monitoring its decarbonisation strategy, in line with medium- to long-term climate objectives. Monitoring is carried out both at the consolidated level and at the level of each production site, where relevant.

IDENTIFICATION OF RELEVANT CATEGORIES

Consistent with the GHG Protocol, the 15 Scope 3 categories were analysed. Following the assessment, which considered the nature of the Group's activities, its business model, supply chain structure, data availability and significance of impacts, the Group identified the following categories as material.

Category 1 – Purchased goods and services: Gefran has a considerable number of suppliers providing all the materials necessary for the production of finished products and services for the management of its business. These are the source of significant emissions along their supply chain. Emissions associated with the production of goods and services purchased by the organisation are calculated thereby.

Annual Financial Report at 31 december 2025 Gefran Group

Category 2 – Capital goods (Capex): Investments often involve the construction or acquisition of physical assets, such as buildings, plants or equipment. These assets typically have a long lifespan and are a source of emissions during their life cycle (emissions from use are already included in Scope 1 and 2). Emissions associated with the production of purchased assets, such as buildings, plants and equipment purchased or rented by the organisation, are calculated thereby.

Category 3 - Fuel and energy-related activities: According to the energy audits carried out, Gefran is not considered as an energy-intensive business and more than 80% of the electricity consumed in the Group is from certified renewable sources (from purchase or self-production). Emissions from the extraction, production and transport of fuels and energy consumed by the organisation, not already included in Scope 1 and 2, are calculated thereby.

Category 4 & 9 – Upstream & downstream transportation & distribution: The goods purchased by Gefran come from various countries and are transported along several routes and modes of transport. Most of the goods sold are delivered to customers in different countries, through a variety of routes and modes of transport, both directly from the production plants and from the commercial branches of the Group. These processes are a substantial part of the total emissions generated along the Group's value chain.

Category 6 – Business travel: Gefran is a multinational company with offices in 11 countries and deals with customers and suppliers worldwide. Business travel is necessary for its business development and contributes significantly to its other indirect emissions. Emissions from employee' business trips are calculated, excluding travel using means of transport owned or controlled by the organisation (already included in Scope 1 and 2).

Category 7 – Employee commuting: The Group has 748 employees and 42 non-employees, most of whom work at its offices and production sites. The carbon footprint of employees' daily commute is considered potentially significant. In addition to emissions from daily travel, the share relating to remote-working arrangements is also calculated.

Based on documented assessments that took into account the limited significance of emissions for some categories, the nature of the processes and products sold by Gefran, and the emissions already included in Scope 1 and 2, the remaining Scope 3 categories provided for by the GHG Protocol are regarded as not material or applicable. Below is a summary of the analysis performed, which led to the exclusion of given categories.

	ID Category	Description	Reason
5	Waste	Emissions from the gener	Not significant for the Gefran Group.
	generated in	ation and disposal of waste
	operations	produced by the organisation's	The waste generated by the Group, part of which derives from its
		activities, including both solid	offices, is not quantitatively significant. Most of the waste gener
		and liquid waste.	ated is non-hazardous in nature.
8	Upstream	Emissions associated with	Not applicable to the Gefran Group.
	leased assets	the use of assets leased or
		rented by the organisation,	The properties and equipment used in the Group are mostly owned by
		such as property, vehicles andequipment.	it. Where leased or rented goods are used, as is the case for the company vehicle fleet, printers, groups of generators and certain com
			mercial offices, the emissions generated by their uses are already
			included in Scope 1 and 2. Emissions generated by any maintenance
			are included in the category "Purchased goods and services".
	10 Processing of	Emissions associated with the	Not applicable to the Gefran Group.
	sold products	processing and transforma
		tion of products sold by the	The products sold by Gefran, by their nature, do not undergo repro
		organisation	cessing involving energy consumption.
	11 Use of sold	Emissions from the use of	Not applicable to the Gefran Group.
	products	products sold by the organi
		sation, including energy con	The products sold by Gefran, by their nature, do not represent
		sumed during usage.	a final product, since they are included in industrial plants and
			machinery made by machinery manufacturers. Gefran products
			do not have an "independent" function and cannot be used andtreated separately from the plant or machinery in which they have
			been incorporated as individual components.
	12 End-of-life	Emissions from the disposal,	Not applicable to the Gefran Group.
	treatment of	recycling or treatment of prod
	sold products	ucts sold by the organisation,	Category 11 considerations are also valid for the end-of-life treat
		at the end of their life cycle.	ment of products sold by Gefran, installed in plants and machinery
			made by manufacturers, subsequently used in production lines
			and disposed of at the end of their useful life. In general, the end
			of-life treatment of the Gefran product is simultaneous with and
			not distinguishable from the plant and machinery processes in
	13 Downstream		which it is integrated.
	leased assets	Emissions associated withthe management of leased or	Not applicable to the Gefran Group.
		rented assets.	No assets have been leased or rented to third parties for the time
			being.
	14 Franchising	Emissions from franchise or	Not applicable to the Gefran Group.
		branch activities under the
		control of the organization.	The Group structure does not provide for franchises and the emis
			sions generated by its commercial branches are already included
			in Scope 1 and 2.
	15 Investments	Emissions associated with the	Not significant for the Gefran Group.
		organisation's investments in other
		companies or projects, including	The amount of emissions associated with investee companies (all
		equity investments, loans and	of which carry out activities in the technology sector), for the por
		other financial instruments.	tion attributable to Gefran, is considered not significant.

	ID Category	Description	Reason
5	Waste	Emissions from the gener	Not significant for the Gefran Group.
	generated in	ation and disposal of waste
	operations	produced by the organisation's	The waste generated by the Group, part of which derives from its
		activities, including both solid	offices, is not quantitatively significant. Most of the waste gener
		and liquid waste.	ated is non-hazardous in nature.
8	Upstream	Emissions associated with	Not applicable to the Gefran Group.
	leased assets	the use of assets leased or
		rented by the organisation,	The properties and equipment used in the Group are mostly owned by
		such as property, vehicles and	it. Where leased or rented goods are used, as is the case for the com
		equipment.	pany vehicle fleet, printers, groups of generators and certain com
			mercial offices, the emissions generated by their uses are already
			included in Scope 1 and 2. Emissions generated by any maintenance
	10 Processing of	Emissions associated with the	are included in the category "Purchased goods and services".Not applicable to the Gefran Group.
	sold products	processing and transforma
		tion of products sold by the	The products sold by Gefran, by their nature, do not undergo repro
		organisation	cessing involving energy consumption.
	11 Use of sold	Emissions from the use of	Not applicable to the Gefran Group.
	products	products sold by the organi
		sation, including energy con	The products sold by Gefran, by their nature, do not represent
		sumed during usage.	a final product, since they are included in industrial plants and
			machinery made by machinery manufacturers. Gefran products
			do not have an "independent" function and cannot be used and
			treated separately from the plant or machinery in which they have
			been incorporated as individual components.
	12 End-of-life	Emissions from the disposal,	Not applicable to the Gefran Group.
	treatment of	recycling or treatment of prod
	sold products	ucts sold by the organisation,	Category 11 considerations are also valid for the end-of-life treat
		at the end of their life cycle.	ment of products sold by Gefran, installed in plants and machinery
			made by manufacturers, subsequently used in production lines
			and disposed of at the end of their useful life. In general, the end
			of-life treatment of the Gefran product is simultaneous with and
			not distinguishable from the plant and machinery processes inwhich it is integrated.
	13 Downstream	Emissions associated with	Not applicable to the Gefran Group.
	leased assets	the management of leased or
		rented assets.	No assets have been leased or rented to third parties for the time
			being.
	14 Franchising	Emissions from franchise or	Not applicable to the Gefran Group.
		branch activities under the
		control of the organization.	The Group structure does not provide for franchises and the emis
			sions generated by its commercial branches are already included
			in Scope 1 and 2.
	15 Investments	Emissions associated with the	Not significant for the Gefran Group.
		organisation's investments in other
		companies or projects, including	The amount of emissions associated with investee companies (all
		equity investments, loans and	of which carry out activities in the technology sector), for the por
		other financial instruments.	tion attributable to Gefran, is considered not significant.

	ID Category	Description	Reason
5	Waste	Emissions from the gener	Not significant for the Gefran Group.
	generated in	ation and disposal of waste
	operations	produced by the organisation's	The waste generated by the Group, part of which derives from its
		activities, including both solid	offices, is not quantitatively significant. Most of the waste gener
		and liquid waste.	ated is non-hazardous in nature.
8	Upstream	Emissions associated with	Not applicable to the Gefran Group.
	leased assets	the use of assets leased or
		rented by the organisation,	The properties and equipment used in the Group are mostly owned by
		such as property, vehicles and	it. Where leased or rented goods are used, as is the case for the com
		equipment.	pany vehicle fleet, printers, groups of generators and certain com
			mercial offices, the emissions generated by their uses are already
			included in Scope 1 and 2. Emissions generated by any maintenance
			are included in the category "Purchased goods and services".
	10 Processing of	Emissions associated with the	Not applicable to the Gefran Group.
	sold products	processing and transforma
		tion of products sold by the	The products sold by Gefran, by their nature, do not undergo repro
	11 Use of sold	organisationEmissions from the use of	cessing involving energy consumption.Not applicable to the Gefran Group.
	products	products sold by the organi
		sation, including energy con	The products sold by Gefran, by their nature, do not represent
		sumed during usage.	a final product, since they are included in industrial plants and
			machinery made by machinery manufacturers. Gefran products
			do not have an "independent" function and cannot be used and
			treated separately from the plant or machinery in which they have
			been incorporated as individual components.
	12 End-of-life	Emissions from the disposal,	Not applicable to the Gefran Group.
	treatment of	recycling or treatment of prod
	sold products	ucts sold by the organisation,	Category 11 considerations are also valid for the end-of-life treat
		at the end of their life cycle.	ment of products sold by Gefran, installed in plants and machinery
			made by manufacturers, subsequently used in production lines
			and disposed of at the end of their useful life. In general, the end
			of-life treatment of the Gefran product is simultaneous with and
			not distinguishable from the plant and machinery processes in
	13 Downstream	Emissions associated with	which it is integrated.Not applicable to the Gefran Group.
	leased assets	the management of leased or
		rented assets.	No assets have been leased or rented to third parties for the time
			being.
	14 Franchising	Emissions from franchise or	Not applicable to the Gefran Group.
		branch activities under the
		control of the organization.	The Group structure does not provide for franchises and the emis
			sions generated by its commercial branches are already included
			in Scope 1 and 2.
	15 Investments	Emissions associated with the	Not significant for the Gefran Group.
		organisation's investments in other
		companies or projects, including	The amount of emissions associated with investee companies (all
		equity investments, loans and	of which carry out activities in the technology sector), for the por
		other financial instruments.	tion attributable to Gefran, is considered not significant.

	ID Category	Description	Reason
5	Wastegenerated in	Emissions from the generation and disposal of waste	Not significant for the Gefran Group.
	operations	produced by the organisation'sactivities, including both solidand liquid waste.	The waste generated by the Group, part of which derives from itsoffices, is not quantitatively significant. Most of the waste generated is non-hazardous in nature.
8	Upstreamleased assets	Emissions associated withthe use of assets leased or	Not applicable to the Gefran Group.
		rented by the organisation,such as property, vehicles andequipment.	The properties and equipment used in the Group are mostly owned byit. Where leased or rented goods are used, as is the case for the company vehicle fleet, printers, groups of generators and certain commercial offices, the emissions generated by their uses are alreadyincluded in Scope 1 and 2. Emissions generated by any maintenanceare included in the category "Purchased goods and services".
	10 Processing ofsold products	Emissions associated with theprocessing and transforma	Not applicable to the Gefran Group.
		tion of products sold by theorganisation	The products sold by Gefran, by their nature, do not undergo reprocessing involving energy consumption.
	11 Use of soldproducts	Emissions from the use ofproducts sold by the organi	Not applicable to the Gefran Group.
		sation, including energy consumed during usage.	The products sold by Gefran, by their nature, do not representa final product, since they are included in industrial plants andmachinery made by machinery manufacturers. Gefran productsdo not have an "independent" function and cannot be used andtreated separately from the plant or machinery in which they have
			been incorporated as individual components.
	12 End-of-lifetreatment of	Emissions from the disposal,recycling or treatment of prod	Not applicable to the Gefran Group.
	sold products	ucts sold by the organisation,at the end of their life cycle.	Category 11 considerations are also valid for the end-of-life treatment of products sold by Gefran, installed in plants and machinerymade by manufacturers, subsequently used in production linesand disposed of at the end of their useful life. In general, the endof-life treatment of the Gefran product is simultaneous with andnot distinguishable from the plant and machinery processes inwhich it is integrated.
	13 Downstreamleased assets	Emissions associated withthe management of leased or	Not applicable to the Gefran Group.
		rented assets.	No assets have been leased or rented to third parties for the time
	14 Franchising	Emissions from franchise orbranch activities under the	being.Not applicable to the Gefran Group.
		control of the organization.	The Group structure does not provide for franchises and the emissions generated by its commercial branches are already includedin Scope 1 and 2.
	15 Investments	Emissions associated with theorganisation's investments in other	Not significant for the Gefran Group.
		companies or projects, includingequity investments, loans andother financial instruments.	The amount of emissions associated with investee companies (allof which carry out activities in the technology sector), for the portion attributable to Gefran, is considered not significant.

CONSOLIDATED FINANCIAL STATEMENTS

248 249

It should be noted that, based on the analysis carried out on 2025 data, the emissions generated by processes relating to the categories considered non-significant are, overall, below the materiality threshold, defined as 5% of the total Scope 3 emissions.

GENERAL METHODOLOGICAL APPROACH

The process for calculating Scope 3 emissions is divided into the following main phases:

• / Data collection through standardised templates, differentiated by category, and questionnaires (for commuting);
• / Classification of expenditure and activities according to a structured taxonomy (based on product groups and the CPA08 system);
• / Application of the most appropriate emission factors based on the category and availability of data, giving priority to specific data where available;
• / Calculation of emissions expressed in tonnes of CO₂ equivalent (tCO₂e);
• / Consistency and reconciliation checks with data from financial statements and historical trends.

Emissions are calculated by avoiding double-counting with Scope 1 and Scope 2 and by ensuring methodological consistency across categories. Below is the breakdown of Scope 3 emissions calculated for 2025 for each category.

Gross Scope 3 GHG emissions	Unit ofmeasurement	2025
Gross Scope 3 GHG emissions		10,381
1 Purchased goods and services		6,724
2 Capital goods		497
3 Fuel and energy-related activities (not included in Scope 1 or 2)	tCO2eq	304
4 Upstream transportation and distribution		1,783
6 Business travel		279
7 Employee commuting		578
9 Downstream transportation		216

CALCULATION METHODOLOGIES BY CATEGORY

The methodology used gives priority, where possible, to specific and primary data; however, for some categories and suppliers, estimates and average factors are used in line with best market practices. The main assumptions, methodological limits and sources of emission factors are documented transparently and reviewed periodically as part of the annual update.

Categories 1 and 2 – Purchased goods and services and Capex

Emissions are estimated mainly by using the spend-based method, applying emission factors deriving from the Eurostat CPA08 database, combined with the Use Table (economic input-output model), based on the classification of expenditure and activities according to the taxonomy defined at Group level (Category Emission Factors). Where available, supplier-specific emission factors (so-called Supplier Emission Factors) are used, based on declared emissions and revenues. Specifically, if only Scope 1 and 2 emissions are declared, it is assumed that Scope 3 emissions account for about 60% of the overall emissions of the organisation, thus obtaining an estimate of the supplier's total emissions (Estimated Scope 3 Emissions = (Scope 1 + Scope 2) / 0.4 * 0.6).

		Method
	Supplier-specific	Spend-based
Emission Factor	EF=Total Emissions/Total Revenues(tonnes of C02eq/€M)	EF=Total Emissions from a Productin EU/Total Spend by Buyers(tonnes of C02eq/€M)
Total Emissions	Total Emissions = Total Spend *Supplier EF(tonnes of C02eq)	Total Emissions = Total Spend *Category EF(tonnes of C02eq)

250 251

With reference to the 2025 analysis, 55% of the emissions calculated for categories 1 and 2 derive from the application of Category Emission Factors, while 35.9% derive from the application of Supplier Emission Factors.

Thanks to the direct involvement of some suppliers, it was also possible to collect precise data on the emissions generated and related to the products supplied to the Gefran Group, accounting for 8.5% of the total emissions of categories 1 and 2.

Category 3 – Fuel- and energy-related activities

Emissions are estimated based on accurate energy consumption data, reported by the Group as required by ESRS E1-5, applying emission factors from the UK DEFRA database, specifically WTT- fuels, WTT- electricity and Transmission and distribution.

Categories 4 and 9 – Upstream and downstream transportation

For the purposes of the analysis, emissions from third-party transport services in the relevant year are considered, including inbound and outbound logistics and freight transportation between the Group's different sites and warehouses. Emissions are calculated mainly using the distance-based method (about 78.5% of emissions of categories 4 and 9), based on the distance travelled and the weight of the shipments, taking into account the means of transport. The emission factors used come from the UK DEFRA database, specifically Freighting goods.

Thanks to the direct involvement of some logistics services providers, it was possible to collect precise data on the emissions generated by Gefran's transports, through the reports made available by shippers, accounting for 8.8 % of the total emissions of categories 4 and 9.

The spend-based method is used exclusively when specific data are not available (equal to 12.5% of the emissions generated by categories 4 and 9), using the emission factor from the Eurostat CPA08 database, for the category.

Category 9 includes emissions from the transportation of finished products sold, not controlled or paid by Gefran.

Category 6 – Business travel

The calculation is carried out using different methods that take into account the various modes of travel:

/ Air transport: basic information on air travel in the relevant year (origin and destination, class, costs, number of travellers) is collected; emissions are calculated using the distance-based method, applying factors from the International Civil Aviation Organization (ICAO) database for available routes, or from the UK DEFRA database; in the absence of distance information, the spend-based method and emission factors from the Eurostat CPA08 database category are used.

/ Rail and road transport: basic information on rail travel in the relevant year (origin and destination, class, costs, number of travellers) is collected; UK DEFRA factors are applied on the basis of the distance-based method; in the absence of distance information, the spend-based method and emission factors from the Eurostat database (category CPA08) are used.

/ Hotel stays: basic information on hotel stays in the relevant year is collected (hotels, number of rooms, number of nights, costs); emissions are calculated by applying country-specific factors (UK DEFRA or Hotel Footprint Calculator); in the absence of detailed information, a spend-based approach and emission factors from the Eurostat CPA08 database category are used.

Category 7 – Employee commuting

Emissions are estimated by applying a distance-based method, using a survey involving employees and temporary workers allowing for the travel habits of the workforce to be mapped. The survey was submitted during 2024 in all the Group companies and in the various languages spoken to ensure more effective engagement. The results collected were weighted to the active Gefran population as at 31 December 2025, to reflect the current size of the Group. For each response, the most appropriate emission factor (based on the mode of travel), was identified from the available UK DEFRA database. It is specified that journeys made with company vehicles are excluded as they are reported in Scope 1. Emissions from remote-working days are included in the calculation.

Total emissions

The total GHG emissions associated with direct and indirect activities carried out under the control of Gefran are shown in the following tables.

Gross Scope 1 and 2 GHGemissions	Unit ofmeasurement	2024	2025	Change2025-2024
Total location-based GHGemissions		2,594	2,428	-6.4%
Total market-based GHGemissions	tCO2eq	1,581	1,597	-1.1%

Gross Scope 1, 2, 3 GHGemissions and totalemissions	Unit ofmeasurement	2024	2025	Change2025-2024
Total location-based GHGemissions		n.a.	12,809	n.a.
Total market-based GHGemissions	tCO2eq	n.a.	11,979	n.a.

The following table shows the intensity of emissions indicator (Scope 1 and 2) with reference to the consolidated revenues of the Group for the year, equal to 138,964 thousand Euro (132,607 thousand Euro in 2024), as reported in the paragraph Gefran consolidated results, included in the Report on Operations; they relate to the items "Revenues from product sales" and "Other revenues and income" reported in the Statement of profit/(loss) for the year of the consolidated financial statements and in the relevant Specific explanatory notes to the accounts. The indicator is presented taking into account the various methods of calculating Scope2.

Intensity of SCOPE 1 and 2 GHGemissions by net revenues	Unit ofmeasurement	2024	2025	Change2025-2024
Intensity of location-based GHGemissions (total GHG emissions ascompared to net revenues)		2.0%	1.7%	-10.7%
Intensity of market-based GHGemissions (total GHG emissions ascompared to net revenues)	tCO2eq/mln€	1.2%	1.1%	-3.6%

Applying the same method, the overall emission intensity indicator (Scope 1, 2 and 3) was also calculated for fiscal year 2025.

Intensity of SCOPE 1, 2 and 3 GHG emissions by net revenues Intensity of location-based GHG emissions (total GHG emissions as Intensity of market-based GHG emissions (total GHG emissions as compared to net revenues)

Intensity of SCOPE 1, 2 and 3 GHGemissions by net revenues	Unit ofmeasurement	2025
Intensity of location-based GHGemissions (total GHG emissions ascompared to net revenues)		9.2%
Intensity of market-based GHGemissions (total GHG emissions ascompared to net revenues)	tCO2eq/mln€	8.6%

(E1-6 44, 48 a, b, 49 a, b, 50, 51, 52 a, b, 53, 54, 55) (E1-6 AR 39, 43)

Annual Financial Report at 31 december 2025 Gefran Group

ESRS E5 RESOURCE USE AND CIRCULAR ECONOMY

The products manufactured and marketed by Gefran are divided into two main business lines: sensors and components. Within each line, there are many categories, each characterized by specific peculiarities and different basic differences. All products come together with a high technological content that guarantees their various intrinsic functionalities. Most Gefran products include an electronic component (of various degrees of complexity), an electromechanical and mechanical component, and a "case" made up of different materials (mainly plastic or metal) and varying sizes, depending on the type of product, the intended application and its size (various sizes are available for the same product, implying the use of different amounts of material). Gefran products are not intended for direct consumption; rather, they are used in the construction of industrial plants, supporting production processes in many sectors, including Plastics, Mobile Hydraulics, Metal and Heat treatment.

The research and development phases, in addition to support activities assisting commercialization and administrative formalities, require the use of services provided by third parties of various kinds, which are important in terms of total value of expenditure (about one third). Investment in Research and Development (R&D) is associated exclusively with the entities engaged in the design activities: Gefran Spa (IT), Gefran Soluzioni (IT), Elettropiemme (IT), CZ Elettronica (IT) and Gefran Schweiz (CH).

The operational phases require the use of materials included in bills of materials and consumables to support product assembly, of which the main categories of resources are electronics (integrated systems, connectors and printed circuits) and mechanics (steel, aluminium and plastic parts). The analyses revealed the importance of the environmental impact associated with the Group's waste production, as well as the risk arising from the lack of supply of products developed with a focus on the origin of resources and circularity and of a business opportunity related to the development of products and services that, thanks to their functionalities and nature, enable users to manage resources more efficiently. The operating units associated with these IROs, with reference to the issue of waste, are mainly Group companies that include production plants: Gefran Spa (IT), Gefran Soluzioni (IT), Elettropiemme (IT), Gefran Schweiz (CH), Gefran Inc (US), Gefran Brasil (BR), Gefran Automation Technology (CN). By contrast, the subsidiaries Gefran Gmbh (DE), Gefran Benelux (BE), Gefran France (FR), Gefran Uk (UK), Gefran Asia (SG) and Gefran India (IN) carry out purely commercial activities with a limited number of employees, so their impact on waste production is mainly related to office activities and is therefore considered to be marginal.

Impact, risk and opportunity management

ESRS 2 IRO-1 Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities

Gefran has always paid attention to environmental aspects, including the impact of risks and opportunities that may arise from its activities, with an eye on the value chain.

In conducting the double materiality assessment aimed at identifying material impacts, risks and opportunities relating to resource use and circular economy, Gefran considered the activity carried out by the Group, its production process and the type of products produced, as well as the geographical distribution of such activities and the main players in its upstream and downstream chain. Detailed analyses were also carried out on the procurement flows from suppliers, based on the type of supply in addition to the materials/services provided, on the basis of the mapping of information already available.

The processes for identifying significant IROs, including those related to resource use and circular economy, involve all levels of the organisation, as described in the section General disclosures - Impact, Risk and Opportunity Management – Materiality Assessment Process, IRO-1 of this Report.

With regard to outflows and waste production, the analyses were based on the Group's operating environment and the main markets served, as well as on the strategy implemented by Gefran, including the Strategic Plan, the Industrial Plan and the operating methods for issue management.

As with other topics covered, the analysis of resource use and circular economy risks was initiated through the Enterprise Risk Management process already implemented in the Company. This process integrates ESG risks, with a specific focus on risks related to ESRS topics and sub-topics.

Value Chain mapping was carried out according to the principle of materiality, taking into account two main drivers: expenditure and products sold by the Group. The objective was to understand the main products purchased, the geographical distribution of the major suppliers and the sectors served.

The Group purchases electronic, mechanical and electromechanical components for the production of final products. The detailed analysis of the purchased materials was carried out by categorizing the different incoming flows, according to the types of raw materials and processes included in purchased products (typically processed products).

(ESRS 2 – IRO-1 11 a)

In order to identify the relevant IROs, in addition to the internal functions directly involved, the Group's Top Management and Governance, the main Stakeholders affected were also involved. Consultation sessions were held with customer representatives, research institutes supporting R&D activities, and a selection representing the local supply chain. During these sessions, information useful to the evaluation of the IROs identified was shared and indications were collected through questionnaires. It should be noted

Annual Financial Report at 31 december 2025 Gefran Group

The materiality assessment carried out, as described in detail in the section General disclosures of this Report, gave evidence of the material IROs listed in the table below.

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
				The development and
WASTE				offer of products,
				which provide users
				with predictive anal
				ysis, efficient use of
				resources and the
				possibility of planning
RESOURCE				maintenance in order
OUTFLOWS				to prevent breakdowns
RELATED TO				and downtime, as
PRODUCTS AND				well as the offer of
SERVICES				revamping services, are
				an opportunity, being a
				source of commercial
				attraction to increase
				Gefran's competitive
				ness on the market
	The Gefran Group's
	waste production has
	an impact on environ
	mental pollution
			Failure to offer prod
			ucts developed with
			a focus on circularity
RESOURCE			(also with regard to
INFLOWS,			packaging) may give
INCLUDING			rise to the risk of loss
RESOURCE USE,			of reputational value
RESOURCE			and/or competitive
OUTFLOWS			ness of Gefran on the
RELATED TO			market, as well as to
PRODUCTS AND			possible non-compli
SERVICES			ance with sustainability
			regulations

E5-1 Policies related to resource use and circular economy

For the time being, Gefran has not formalised a policy specifically dedicated to resource use and circular economy, since some aspects of the topic, as described below, are included in its broader Health, Safety and Environment System Policy. With this policy, the Group is committed to optimizing the consumption of energy resources and raw materials, preventing pollution by identifying, monitoring and reducing the environmental impact of its processes and products. It aims to harmonise environmental management, prevent damage, optimise energy consumption, responsibly manage the supply chain and provide adequate training.

The Health, Safety and Environment Policy, published on the Company's website and also intended for external Stakeholders, is illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P included in the section General disclosures of this Report.

Gefran undertakes to comply with environmental laws and to manage its activities according to the highest international standards and the principles of continuous improvement.

The path towards an Integrated Management System (IMS) involved obtaining the environmental certification for all the Group's production plants. The project, launched in 2021 and led by the integrated Q-HSE function, saw in 2023 the achievement of environmental certification according to the ISO 14001:2015 standard for all the Group's Italian companies in which there is the greatest concentration of processes and people. It continued in 2024 and 2025 with a focus on the production plants in Switzerland, the United States and China, allowing for third-party audits to be carried out and achieving the target set, obtaining the certification in question also for the foreign production sites (audits were carried out in December 2025 and January 2026).

In the exercise of its functions, with particular emphasis on waste management, the Quality, Safety and Environment (Q-HSE) Department:

• / promotes proper application of the management system in accordance with the organisation's requirements and the ISO 14001:2015 standard;
• / ensures the integrity of the System in line with the Company's defined strategy. (E5-1 14, 15) (MDR-P 62)

E5-2 Actions and resources related to resource use and circular economy

The Group acts in compliance with the environmental regulations in force in the various countries in which it is active and operates according to the highest international standards and principles of continuous improvement, through an Integrated Management System (SGI) that, among others, complies with the ISO 14001:2015 standard.

In general, the actions implemented by Gefran are part of the Group's longterm strategy and are aimed, in the area of resource use and circularity, at mitigating the risks of material negative impacts as well as at pursuing the opportunities found.

Responsible waste management is an essential element of Gefran's environmental sustainability strategy. It takes the shape of data monitoring and analysis, as well as the implementation of initiatives aimed at achieving the objectives defined in this area.

The centralised Q-HSE function oversees waste management, ensuring constant monitoring through the collection and processing of information relating to the waste produced. The systematic classification of waste and its measurement enable the identification of waste compliant with the European Waste Code (EWC) and the standardisation of temporary storage areas. To facilitate data monitoring and reporting, aggregate indicators (KPIs) based on the weight of waste generated by individual plants have been defined, distinguishing between hazardous and non-hazardous waste, as well as the methods of waste disposal and recovery.

At the same time, training activities are carried out for the staff involved as well as employee awareness-raising activities. The heads of the Environmental Management System have been appointed and an internal audit programme has been launched to monitor waste management.

These activities, together with the monitoring of performance indicators, allow for the identification of the actions necessary to continuously improve environmental performance.

The analysis by type of intended purpose shows a significant prevalence of waste intended for recovery, i.e. 70.4% of the total in 2025 (59.6% of the total in 2024) compared to waste intended for disposal, accounting for 29.6% of the total in 2025 (40.4% of the total in 2024). This result is attributable to the structured activities of separate waste collection and to the strict supervision of the management of these activities by the centralised Q-HSE function, with a view to constant improvement.

In 2025, various actions were implemented at the Parent Company (the main production centre of the Gefran Group), thereby increasing the proportion of waste intended for recovery (reuse or recycling) compared with that for disposal. The main actions concerned wash water from the production departments' floors (potentially contaminated) and the compressors' condensation. Thanks to the said actions and recent analyses, such waste is considered non-hazardous and can be diverted to other recovery operations (in 2024 it was classified as hazardous and disposed of).

As regards circularity, particular importance is attached to the handling of packaging accompanying products, which is often disposable and contributes to feeding a linear waste-based economy. Gefran has launched a process aimed at reconciling respect for the environment, integrating circularity principles into management, while preserving the functionality of packaging, particularly with regard to the protection of products that ensures their integrity in transport from production sites to customer warehouses.

An in-depth analysis of the Parent Company Gefran S.p.A., the Group's main production entity that distributes its products to all subsidiaries, confirmed that the packaging currently used is made up of recyclable materials. The main actions undertaken concern the rationalisation of the different types of packaging, with the aim of optimizing procurement and stocks, as well as the transition to more easily degradable materials, favouring the latter over materials such as litmus paperboard, plastics, film for packaging, polyurethane, polystyrene, iron. In addition, for finished mass-produced items, typically all products (with the exception of the phase-out series) from the sensors, instruments, power-control and programmable-automation ranges, neutral cardboard boxes have been progressively introduced, which are more easily recyclable or degradable than materials derived from processes involving dyes or other potentially hazardous substances. For the sensors range, actions have been identified to eliminate the use of plastic supports (specifically polyester copolymer) in the packaging of two of the most significant product families (industrial pressure and potentiometers), this requiring investments in new equipment (approximately 10 K Euro in 2025) and a revision of the packaging process. The project will produce tangible benefits such as reducing the amount of plastic used, reducing the volume of packaging by more than two-thirds and improving overall efficiency (both energy and process efficiency).

The actions taken have also been focused on the use of paper to support various corporate processes.

In 2024, alternative supplies were started, favouring FSC (or equivalent) certified paper. This initiative allowed for the achievement of 100% of certified source paper in 2025 out of the total purchases at Group level (the objective was to reach 100% by 2026).

Gefran has launched significant digital transformation projects over the years aimed at optimising operating processes. The Smart Manufacturing project, developed with a multi-year vision and articulated in the areas of Logistics, Production and Supply Chain, provides for the analysis and review of processes with a view to digitalisation. Digitalisation, in particular, offers benefits in terms of environmental impact, ensuring a more efficient use of resources to support the execution of processes and, at the same time, it allows for data collection, improving monitoring and analysis.

Digital document management accelerates information flows, fosters communication and improves efficiency. Some of the issues addressed in previous years have now become established processes, contributing to the overall reduction of paper waste:

• / the management of meetings held by the Company's governance bodies through the support of digital tools avoids documents being printed on paper; optical archiving of invoices and books reduces paper consumption;
• / the management of documents concerning relations with employees (pay slips, refunds, etc.) is carried out through a dedicated digital platform avoiding the use of paper forms;
• / the forwarding in digital form to customers of information related to the shipment of the products they have ordered (within Smart Logistic, branch of the Smart Manufacturing project).

Thanks to the precise monitoring of purchase flows, from 2023 to 2025 the Group's paper consumption fell by 38.8%.

A plan has also been launched for the progressive reduction of paper as a support for production processes. The work plan varies, depending on the characteristics of

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operating processes, for sites engaged in mass production compared with sites operating on a make-to-order basis.

As part of the Smart Manufacturing project, implemented by the Parent Company Gefran S.p.A., the actions aim to digitalise material preparation and production, progressively integrating the various production areas. Process mapping and the development of dashboards connected to the management system make it possible to avoid printing the production order, replaced by a label that follows the order throughout all stages and contains essential information. This operating mode was launched in the automation components division in 2024 and extended to further work areas within the same division in 2025, allowing not only for a reduction in paper consumption but also for increased process efficiency. According to the work plan, this approach will continue to be gradually implemented until it is fully integrated into the division's operational processes. Detailed and periodically monitored data regarding the automation components operating division show that there was a 37% reduction in paper consumption in 2025 compared with the previous year, from an average of 3.6 sheets per production order (data of 2024) to 2.4 (data of 2025).

Unlike the automation components division, the production of sensors is more complex, thus the mapping of impacts and the study of alternative operating methods are still being completed. The precise and systematic analysis of paper consumption, however, has highlighted some particularly critical processes, for which actions were taken during 2025, such as the elimination of the printing of some technical information (e.g. manuals, calibration bulletins) and the digitalisation of some executive procedures. The measures implemented led to a significant reduction in consumption, as observed by detailed surveys on the number of sheets used in 2025 compared to 2024, such reduction being 15% for the Sensors operating division, from an average of 7.2 sheets consumed per production order (data of 2024) to 6 (data of 2025).

The process digitalisation plan, aimed at improving efficiency and reducing paper use, was implemented in Group companies operating on a make-to-order basis with the installation, at operators' workstations, of devices for reading electrical diagrams via a digital platform (a total of 11 workstations completed in 2024 and 2 additional ones in 2025). The activity, launched in the subsidiary Gefran Soluzioni S.r.l., continued in 2025 in the subsidiary Elettropiemme S.r.l.

Gefran has grown thanks to investments in sustainable innovation, considering research and development as a key element in maintaining competitiveness and generating value in the medium/long term. The company aims to achieve sustainability objectives by improving processes and products. It also integrates principles of circularity through the study of technological solutions designed to optimise the use of resources and energy consumption. Sustainable innovation follows two directions: incremental innovation and ongoing innovation.

Incremental innovation focuses on the improvement and development of new product capabilities and functions, aimed at ensuring energy savings thanks to the intrinsic efficiency of the product itself and the more efficient management of the production process. This is possible through increased availability of field data and more advanced control functions.

Ongoing innovation focuses on expanding the range of products and solutions for industry 4.0. The aim is to promote digital culture, open innovation orientation and a market approach that offers innovative services together with products. These services are made possible by collecting data from sensors and devices and transforming data into information, through algorithms and business intelligence systems, to improve customer processes.

Digital Twin solutions, condition-monitoring algorithms and architectures for data transmission from the field to edge and cloud, have been developed. These Digital Twin models improve the efficiency of the products and production processes managed by Gefran. The integration with Ethercat and IO-Link allows for the development of predictive maintenance and performance optimization solutions.

The product development roadmap, followed in recent years, is divided into three main actions:

• / development of a range of static units equipped with IO-Link and Modbus connectivity, also able to digitalise the deepest components of the machinery and extract the data needed to increase process efficiency;
• / evolution of the multivariate sensor portfolio, i.e., able to reconstruct the three-dimensional movement of a machine element, in order to more accurately predict

any malfunctions and contribute to improving cycle

efficiency;

/ development of the automation portfolio, starting from input/output modules, aimed at developing applications for the control of automatic machines that allow better energy performance and greater use of

recycled raw materials.

The Research and Development area of automation components has released new products that evolve production processes, optimizing performance, energy efficiency and error prevention. In addition, the capacity of Gefran regulators has been improved to make customers' thermal processes more efficient, as demonstrated by the new versions of the 1850 and GFX Termo4 regulators.

In the Research and Development area of the sensors business, significant resources have been invested to expand the range of available field buses, leading to the development of Gefran's first magnetostrictive sensor for Ethercat machine architectures, with high metrological performance and the ability to collect and transmit useful diagnostic data to prevent or mitigate plant failures. Work has also been done with regard to dimension reduction, launching on the market the miniaturised KM pressure probe which, in addition to ensuring a reduction of the environmental footprint thanks to the reduced use of raw materials, is also the base on which to implement digital buses.

For a complete overview of the activities performed by the Research and Development departments in 2025, please refer to the paragraph Research and Development activities of the Report on Operations.

Lastly, with reference to circularity, during 2025 Gefran began an assessment of the environmental impact of its products, through the complete Life Cycle Assessment study (LCA in short, using the cradle-tograve approach). The project is aimed at assessing the environmental performance of a few representative products from the Gefran portfolio, in accordance with the standards of the ISO 14040 series, and is the starting point for defining the model for assessing environmental impacts to be applied when designing new Gefran products.

(E5-2 19) (MDR-A 68 a, b, c, e)

Assessment of life-cycle impacts from cradle to grave

Validation of the methodological assumptions adopted and of results

Metrics and targets

10 The targets are set voluntarily on the basis of monitoring metrics and internal considerations, without the support of scientific data. The targets related to the waste topic mainly refer to prevention and preparation for re-use.

E5-3 Targets related to resource use and circular economy

The emergence of new risks, including increasing attention to environmental and social issues, has required a transformation in undertakings. Gefran's commitments are included in the Strategic Sustainability Plan, formalised in 2022, which is now an integral part of the strategy launched, and which aims to achieve objectives also in relation to resource use and circularity, in line with the political commitments and areas related to the relevant IROs.

The process began by analysing Gefran's positioning and the risks/opportunities of the market. Discussions were held with Stakeholders, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management participated at all levels to define projects, set objectives and determine performance indicators. We then verified the consistency of the targets with the relevant IROs, ensuring the coverage of each important topic. Stakeholders were involved in identifying the relevant impacts, risks and opportunities.

Targets relate to Gefran's activities and are defined according to the scope of the projects launched (more structured for the Group's Italian companies that represent the main production sites) and the defined time horizon. Time horizons are generally medium-term though project-specific (intermediate objectives have not been set for the time being).

In general, periodic monitoring of key indicators makes it possible to verify the effectiveness of actions and to highlight progress over time (measurement started in 2023). Progress is highlighted during regular alignment meetings with the functions in charge of strategy execution, and KPIs measuring the effectiveness of the actions implemented against defined targets are collected at least annually. Findings are shared at Sustainability Committee meetings, during which the performance identified against the defined targets is analysed and targets are reviewed if necessary.

Below are the projects envisaged in the Strategic Sustainability Plan, in relation to resource use and circularity, the targets 10 defined and the progress achieved in 2025.

Projects	Targets	Progress made in 2025
Offer developed productswith a sustainableapproach	Achieve 15% of total revenue from sustainably developed products by 2025 andcompared to 2021.	20.1% of Group-wide revenues comefrom sustainably developed products(15.2% in 2024 and 13.1% in 2023).Gefran continues to strengthen itsapproach to circularity, implementingactions on packaging and developing anLCA product model.
	Reduce production waste Reduce production waste by 30% by 2028and compared to 2022 through processcontrols and the use of more effectivematerials in production processes, bothinternal and at suppliers.	The indicator defined at Group level (ratiobetween the value of production scrapsand the total value paid) of 2025, equalto 1.6%, shows a decrease of 16.7%compared to 2022, when it was equal to1.9%. Monitoring the KPIs will continue,though a future strategy review is notruled out.
For Group products,use packaging that iscompletely recyclableand easily biodegradable	By 2028 and compared to 2023, use 100%recyclable material for the packagingof logistics processes and reduce theimpact by using more easily biodegradablematerials*.* Hardly biodegradable materials are: litmus paperboard,plastics, packaging film, polyurethanes, polystyrene, iron	100% of the material used for packagingat Gefran Spa is recyclable. In terms ofweight, 79.7% is easily degradable (72.7%in 2024).
Reduce paper purchaseand consumption	Purchase 100% certified paper (FSC, PEFCor similar recognised standards) by 2026.By 2026 and compared to 2023, reducethe percentage of paper used with respectto the previous year by raising employeeawareness	100% of the paper purchased at Grouplevel (in terms of value) is of certifiedorigin (88.5% in 2024).Compared to 2023, paper purchaseshave fallen by 38.8% at Group level.
As part of the SmartManufacturing project,achieve paperlessproduction (includingproduct technicaldocumentation)	By 2028 and compared to 2023, eliminatepaper consumption on the number ofproduction orders generated and handledin a year	At companies with mass production,an average of 4.8 A4 sheets are usedfor each production order (5.1 sheetsin 2024). As regards solely the ParentCompany Gefran S.p.A., Gefran's mainproduction site, 5.1 sheets on averageare used for each processed productionorder (6.3 in 2024).

Annual Financial Report at 31 december 2025 Gefran Group

ANNUAL FINANCIALREPORT		HIGHLIGHTS	REPORT ON OPERATIONS –PROFILE OF THE GROUP	REPORT ON OPERATIONS -INFORMATION ON ACTIVITIES	REPORT ON OPERATIONS –DISCLOSURE OF RISKSAND UNCERTAINTIES TO WHICHTHE GEFRAN GROUP IS EXPOSED
		266				267
Introduce products witha recycled raw materialcomponent	developed.	Provide, by 2025, for the possibility of usingrecycled raw materials for more than 30%of the product weight, for new products	Preliminary analyses were launched targeting the use of materials, with a particular focus on traceability and the origin of resources. However, the integrationof recycled raw materials has technicallimitations, particularly in relation to themaintenance of product performanceand safety requirements. Gefran continues to strengthen its approach to circularity, implementing actions on packagingand developing an LCA product model.		E5-4 Resource inflowsPackagingwhich can become re-usable plastic film again.
Introduce productsaccompanied by aproduct environmentalimpact assessment		Define a model for assessing the environmental impacts of Gefran products,according to the Life Cycle Assessment(LCA) method, and complete the study forat least 4 product families by 2026.	The first pilot project was carried out,which enabled the completion of the LCAstudy for the KM pressure sensor.
Reduce the proportion ofwaste disposal	implemented	By 2028* and compared to 2021, reach ashare of unsorted waste of less than 30%.* Target year revised in light of current waste classifications by intended purpose and of the action plan to be	30% of the waste generated at Grouplevel is destined for disposal (40.4% in2024 and 32.9% in 2023).

(E5-3 25 MDR-T 80a, b, c, e, f, h, j, 24 a, b, c, d, e, f, 27) (E5-3 AR16)

Packaging

With regard to the packaging used by the Group for the distribution of finished products, Gefran uses recyclable materials, in particular PAP20 corrugated cardboard (100% recyclable - provided by Comieco). If a plastic film is applied, the material used is LDPE4, which is known to be recyclable and which can become re-usable plastic film again.

For packaging, circularity logics are applied when choosing the materials to be used, which are recyclable and increasingly biodegradable. The project launched within the Parent Company Gefran S.p.A. (the Group's main production entity that distributes its products to all subsidiaries) aimed at introducing more easily degradable materials, goes precisely in this direction. An accurate mapping of the packaging codes used for the various product types has been carried out, leading to an initial rationalisation of the codes (generating operational efficiency) and, above all, to the replacement of packaging with neutral Havana cardboard, without the colouring and printing processes that use chemicals. The project, launched in 2024 as a "pilot" for the first product families of automation components, continued in 2025, including further product families from the range of instruments and sensors. It will continue until all mass-produced product families are progressively covered.

For the sensors range, actions have been identified to eliminate the use of plastic supports (specifically polyester copolymer) in the packaging of two of the most significant product families (KS and LT), with investments and the launch of new operating processes during 2025, which will lead to a reduction both in the plastic used and in the volume of packaging, generating overall efficiency (both energy and process efficiency).

Specifically, as regards Gefran S.p.A., the Group's main production entity that distributes sensors and automation components to all subsidiaries, in 2025 materials for the packaging of finished products were purchased weighing a total of 82.1 tonnes. At Group level, the total weight of packaging is estimated at 138.1 t and, based on its composition, the recyclable portion is 100%. In this context, for a sample of codes (representing around 57% of total expenditure on the purchase of packaging in 2025), specific data were collected as part of the "Recyclable and easily degradable packaging" project (weight and composition). The estimate is based on the mapping and on the inflows tracked in 2025 (in terms of quantity and value of expenditure) for the sample of codes analysed, compared to the total expenditure for the same purchase category recorded in 2025 (expenditure analysis performed as part of the Scope 3 calculation).

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Material flows

The Group purchases electronic, mechanical and electromechanical compo nents for the production of finished products, in the form of semi-finished products used in production processes. In particular, Gefran's operating processes typically involve the assembly of previously processed materials purchased thereby, without processing virgin raw materials.

Incoming material flows were mapped, based on the analysis of the expend iture for each supplier and material classes in order to understand which are the main products purchased. The analysis was carried out on the most relevant procurement flows for the Group, including all production com panies and some commercial companies that buy and resell products not made within the Group. The materials purchased were further categorised (an activity carried out in the Scope3 calculation process), with the aim of identifying the origin and type of material purchased as precisely as possible and based on the information known.

Based on the data analysed, the categories of semi-finished materials most purchased by the Group are electronics (overall 20% of total procurement expenditure) and mechanics (23% of total procurement expenditure).

Specifically, electronic semi-finished products are supplied by leading global producers, including through large distribution companies. With regard to the source materials incorporated, for the time being the Group does not have data for accurate measurements, except for an assessment based on the type of electronic material purchased: integrated systems account for 6% of total expenditure (10% of the material purchased), connectors account for 4% of total expenditure (6% of the material purchased), and printed cir cuits account for 2% of total expenditure (3% of the material purchased).

Most Gefran products, in addition to the electronics component, include a mechanical component, which constitutes the "case". In essence, of the total mechanical semi-finished products purchased, the most signif icant materials most used in Gefran's production processes are: alumin ium, accounting for 3% of total expenditure (5% of direct material); plastic, accounting for 2% of total expenditure (3% of direct material); and steel, accounting for 9% of total expenditure (15% of direct material). Gefran has launched an initial analysis aimed at identifying possible alternative materials or solutions, applicable to Gefran's products and purchasing strategies, that may generate a lower overall carbon impact. In this context, for a sample of codes representing 55% of the expenditure for the mechanical category in 2025, specific data were collected from suppliers, thereby estimating the overall weight of the most commonly used materials in the production of the Group's finished products. In 2025, 284.2 tonnes of steel, 247.2 tonnes of alu minium and 107.9 tonnes of plastic are estimated to have entered the Group. The estimate is based on the precise data reported by suppliers (weight and composition) and on the incoming flows tracked in 2025 (in terms of quantity and value of expenditure) for the sample of codes analysed, compared to the total expenditure for the same types of mechanical materials recorded in 2025 (mapping of expenditure performed as part of the Scope 3 calculation).

In general, the Group does not currently have accurate visibility of any mate rials of secondary or biological origin purchased. The most used mechanical materials may also derive from circular processes (steel, aluminium), but there are no accurate data on this point.

Given the complexity of the many types of materials used, purchased in the form of semi-finished products (in pieces or metres), Gefran has not yet defined quantitative metrics with respect to what has already been illus trated. With reference to the weight and percentage incidence of products, as well as of the technical and biological materials used, with reference to 2025 we do not have sufficient details to estimate the indicators required, in addition to the above.

The analyses described were carried out on the basis of the expertise within the Group and without involving external experts. (E5-4 30, 31 a, b, 32)

E5-5 Resource outflows

Product outflows

The products manufactured and marketed by Gefran are divided into two main businesses: Sensors and automation components. Several categories are also included within the same line of business, each with specific charac teristics and a different bills of materials. In general, all the products have the same high technological content that allows to obtain their various inherent functionalities.

The products produced by the automation components division are typically regulators for the control of temperature or other variables, power control lers for controlled power supply and PLCs, whether or not equipped with display, with their related I/O cards. Assembled products consist mainly of electronic boards, components in plastic (regulators and power controllers) and steel (PLC) for housing and, only for power controllers, in aluminium for the thermo-dissipative part. The disassembly of parts is relatively simple and defined during the design phase, even if the high technological con tent requires repair to be carried out at the manufacturer's facility. Gefran offers customers a repair and conditioning service, even after the warranty period. The packaging of finished products consists mainly of paper and/ or cardboard, originating from certified or recycled sources and completely recyclable.

The products produced by the Sensors division are position sensors, pres sure sensors, temperature sensors and deformation and force sensors. Assembled products consist mainly of electronic boards and aluminium cases (industrial position sensors), plastic cases (mobile hydraulics sensors) and steel cases (pressure sensors). One of the key technical features to meet customers' application needs is the IP grade seal in operating conditions, obtained by sealing the finished product with welds and glues. Therefore,

(E5-5 35, 36 a, b, c, 40) (E5-5 AR 26, AR 27)

Waste produced

11 With respect to the entire Group, the companies Gefran Uk Ltd and Gefran France S.A. are excluded, since they are purely commercial in nature, as well as with a limited turnover and a small number of employees, so their impact

on the reporting of waste produced is considered not material.

The reporting of data on the waste produced is carried out by involving all relevant Gefran Group companies**11** in the collection of information, as described in the specific Procedure governing this Report, approved by the Board of Directors on 13 February 2025. It should be noted that the scope used for 2025 reporting is different from that used for the previous year, due to the entry into the Group of CZ Elettronica S.r.l., as described in Significant events in 2025.

The data collected by each entity are aggregated and analysed by the Corporate contacts for climate change-related issues (typically the Q-HSE

function).

The tables showing the indicators on waste produced by Gefran are shown below, with the specification that the metrics reported herein have not been validated by an external entity other than the Sustainability Auditor.

In calculating the indicators, the waste produced by the newly acquired CZ Elettronica S.r.l. was estimated, as it was not possible to collect accurate data using consistent metrics for April–December 2025. The estimate took into account the type of operations and processes, the actual consumption of materials for production, and the ratio with respect to the waste produced by the subsidiary Gefran Soluzioni S.r.l. (a Company within the Gefran Group whose activities are similar to those performed by CZ Elettronica S.r.l.). The company, of which Gefran acquired 60% in April 2025, is being gradually integrated into the Group's processes, and the activities necessary to align waste management procedures in particular have already been started.

the disassembly of the parts is typically not simple; hence, sensor repair and reconditioning cannot always be guaranteed. In packaging, in addition to paper and/or cardboard as with automation components, less easily degradable (although recyclable) materials, such as plastic films and dies, may also be used. These are now significantly limited thanks to the company's project to review its packaging processes, as described in paragraph E5-2 Actions and resources related to resource use and circular economy of this section of the Sustainability Report.

The products made by the Group are designed for a useful life (durability) of at least 10 years. Durability is considered average compared with the life expectancy of similar products made by competitors; however, it is much higher when compared with electronic products in other categories, typically "consumer" products.

At present there is no evidence of the overall rate of reparability and recyclability of finished products. Specifically, automation components are designed to be disassembled, with the possible replacement or repair of their electronic boards (the repair of an electronic board must be carried out by qualified personnel equipped with tools for checking its operation). Repairability ensures the reduction of waste, acting on semi-finished products that need repair or modification during the first production flow and, for customers interested in the same, the reconditioning of products from the field through a repair centre that operates both under warranty and in the subsequent years of the product life. Conversely, sensors are not typically designed to be disassembled (to ensure the IP sealing requirements of customer applications), therefore they are difficult to repair. If replacement or repair of electronic boards is possible (e.g. position sensors), this task must be carried out by qualified personnel equipped with tools for checking their operation.

It should be noted that the reported data come from estimates deriving from knowledge of the performance of the products in the field (durability) with reference to the information collected from customers during dedicated meetings, as well as to requests for replacement products and current services offered to the market (repair).

With regard to packaging, the recycling of all the materials used by Gefran is generally possible (based on an analysis carried out on the Parent Company, the Group's main production entity that distributes its products to all subsidiaries). As described in paragraph E5-2 Actions and resources related to resource use and circular economy of this section of the Sustainability Report, a project is under way to reduce its impact and use material (mainly paper and cardboard) that is more easily degradable, created with lower production cycles and with the reduced use of chemical processes. The project, which began in 2024, will see the progressive replacement of packaging for all product families.

Annual Financial Report at 31 december 2025 Gefran Group

Waste NOT intended fordisposal	Unit ofmeasurement	2024	2025	Change2025-2024
Hazardous waste NOTintended for disposal		21.9	23.1	5.3%
Hazardous waste intended forpreparation for reuse		-	-	n.a.
Hazardous waste for recycling		-	-	n.a.
Hazardous waste intended forother recovery operations		21.9	23.1	5.3%
Non-hazardous waste notintended for disposal		203.3	253.2	24.6%
Non-hazardous waste intendedfor preparation for reuse		0.1	0.1	0.0%
Non-hazardous waste forrecycling	ton	12.7	13.0	2.4%
Non-hazardous waste intendedfor other recovery operations		190.5	240.2	26.1%
Total waste not intended fordisposal		225.2	276.3	22.7%
Total waste intended forpreparation for reuse		0.1	0.1	0.0%
Total waste for recycling		12.7	13.0	2.4%
Total waste intended for otherrecovery operations		212.4	263.2	23.9%

Waste for disposal	Unit ofmeasurement	2024	2025	Change2025-2024
Hazardous waste for disposal		45.9	10.6	-76.8%
Hazardous waste intended for
incineration		0.1	0.1	-146.6%
Hazardous waste for landfill		-	-	n.a.
Hazardous waste intended for
other disposal operations		45.9	10.5	-77.1%
Non-hazardous waste for
disposal		106.4	105.6	-0.8%
Non-hazardous waste intended
for incineration	ton	1.9	1.7	-9.6%
Non-hazardous waste for landfill		23.6	29.3	24.5%
Non-hazardous waste intended
for other disposal operations		81.0	75.7	-6.5%
Total waste for disposal		152.3	116.2	-23.7%
Total waste intended for
incineration		1.9	1.8	-5.2%
Total waste for landfill		23.6	29.3	24.5%
Total waste intended for otherdisposal operations		126.9	85.1	-32.9%

(E5-5 37 b i, b ii, b iii) (E5-5 7 c i, c ii, c iii)

The main waste intended for disposal consists of floor washing water, chassis washing (CER 160102), compressor condensate water (CER 16.10.02 and 16.10.01*) which cannot be recovered.

Waste intended for recovery is typically:

• / mixed packaging (mainly paper and plastic) and similar urban packaging;
• / metal scrap (aluminium and steel);
• / electronic boards (printed circuits and electronic components, therefore mainly plastics and metals);
• / other waste such as rags, PPE and packaging contaminated with hazardous substances, and oils and emulsions from machinery. (E5-5 38 a, b)

In 2025, total waste produced amounted to 393 tonnes, a 4% increase compared to the previous year, when 378 tonnes were produced. Part of the increase, in terms of weight of waste produced, is due to the expansion of the scope to include the newly acquired CZ Elettronica S.r.l. (estimated at 1.3%). The remainder of the increase relates to the production companies Gefran S.p.A., Gefran Soluzioni S.r.l., Gefran Brasil (connected with its business increase) and the commercial company Gefran Asia (engaged in activities to eliminate obsolete material).

It should be noted that the Gefran Group does not produce radioactive waste.

The following summary shows the hazardous waste produced and the overall share of non-recycled waste (intended for disposal).

Hazard posed by waste	Unit ofmeasurement	2024	2025	Change2025-2024
Total hazardous waste produced		68	34	-50.4%
Total non-hazardous wasteproduced	ton	310	359	15.9%
Total waste produced		378	393	4%
Total non-recycled waste		152	116	-23.7%
Percentage of non-recycledwaste	%	40.4%	29.6%	-26.6%

(E5-5 39, 37 a, d)

Compared with the previous fiscal year, hazardous waste produced fell by 50.4%, and non-recycled waste sent for disposal fell by 23.7% by weight. The percentage incidence of non-recycled waste intended for disposal out of total waste also improved, falling from 40.4% in 2024 to 29.6% in 2025, with the indicator improving by 26.6% thanks to the actions taken.

Waste generated by the Group's production processes is mainly of a non-hazardous nature (91.4% of the total in 2025).

ESRS S2 WORKERS IN THE VALUE CHAIN

ESRS S1 OWN WORKFORCE

STRATEGY

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

• S1-1 Policies related to own workforce
• S1-2 Processes for engaging with own workforce and workers' representatives about impacts
• S1-3 Processes to remediate negative impacts and channels for own workers to raise concerns
• S1-4 Taking action on material impacts on own workforce, and approaches to managing material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions

METRICS AND TARGETS

• S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities
• S1-6 Characteristics of the undertaking's employees
• S1-7 Characteristics of non-employee workers in the undertaking's own workforce

S1-8 Collective bargaining coverage and social dialogue

• S1-9 Diversity metrics
• S1-10 Adequate wages
• S1-11 Social protection
• S1-12 Persons with disabilities S1-13 Training and skills development
• metrics S1-14 Health and safety metrics
• S1-15 Work-life balance metrics
• S1-16 Compensation metrics (pay gap and total compensation)
• S1-17 Incidents, complaints and severe human rights impact

STRATEGY

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

• S2-1 Policies related to value chain workers
• S2-4 Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions

METRICS AND TARGETS

S2-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

ESRS S4 CONSUMERS AND END USERS

STRATEGY

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

• S4-1 Policies related to consumers and end-users
• S4-4 Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions

METRICS AND TARGETS

S4-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

Annual Financial Report at 31 december 2025 Gefran Group

Strategy

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

This information, as well as the preparatory analyses for its compilation, applies to all Gefran Group employees.

The relationship between Gefran and its workforce is based on care and attention. The Company is committed to providing a healthy and safe work environment that respects its founding ethical principles, promoting inclusivity, support for the personal, technical and professional growth of its employees. Organisational Model 231 has been adopted, which governs the processes for the selection and recruitment of personnel through the relevant procedures manual, ensuring that they are properly carried out in accordance with ethical principles and applicable legislation.

All activities carried out by members of the workforce are not typically subject to the risks of forced or child labour. However, Gefran takes appropriate actions to prevent the risks of forced, compulsory and child labour, ensuring compliance with the ethical principles declared in the Code of Ethics and Conduct, and with the legislation in force in the countries in which it operates directly through its Italian and foreign branches.

(S1 ESRS 2 – SBM-3 14)

Gefran's own workforce consists mainly of employees (748 as at 31 December 2025), while the remainder (42 as at 31 December 2025) is mainly represented by temporary non-employees provided by employment agencies, whose activities are regulated through personnel leasing contracts (so-called temporary agency contracts). It should be noted that temporary staff are mainly employed in the Operations areas. (S1 ESRS 2 – SBM-3 14 a)

(S1 ESRS 2 – SBM-3 14 f i, f ii, g i, g ii)

Gefran's workforce is mostly located in Europe, and particularly in Italy: specifically, as of 31 December 2025, 510 employees were based in Italy (68.2% of the total) out of a total of 748 in the Group, while 75 employees were based in other European countries (10% of the total). The remainder is distributed across America (US and Brazil, 77 employees as at 31 December 2025, or 10.3% of the total), Asia (India, China and Singapore, a total of 86 employees as at 31 December 2025, or 11.5% of the total).

GRUPPO DI LAVORO

Gefran's initiatives focused on people represent an opportunityto increase corporate attractiveness, encouraging the entry ofnew talent and the retention of key employees (attraction andretention)
The training activities carried out in the Group represent anopportunity for the development of key skills, which will ensurethat Gefran remains competitive over time

When examining the categories of workers most exposed to the potential negative impacts resulting from a lack of attention to working conditions and the protection of health and safety at work, the various activities carried out within the Group were assessed. In addition, account was taken of constantly mapped operating risks, the monitoring of their evolution and the implementation of measures to minimise them.

The Company has implemented a system of best practices, shared with all Group companies through periodic meetings with officers to promote safety and health in the workplace, in compliance with regulatory obligations and social accountability.

In general, the workers most exposed to the significant impacts identified are involved in production assembly phases or in goods handling (the main causes of accident are impacts, slips and cuts). (S1 ESRS 2 – SBM-3 15) The analysis performed revealed the following material IROs.

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Impacts

When assessing negative impacts on the workforce, it is crucial to consider working conditions and safety. Failure to pay attention to these issues can cause injuries and health problems, negatively affecting the social sphere. Although Gefran does not have high-risk processes, ensuring the safety of employees and external workers is essential. Thus, the negative impact can be considered generalized.

(S1 ESRS 2 – SBM-3 14 a, c)

Impact, risk and opportunity management

S1-1 Policies related to own workforce

Over the years, Gefran has introduced various policies for managing important topics related to its People. These policies apply widely to the entire workforce and Gefran encourages all employees to participate actively in their implementation.

They are distributed to all workers through pinboards, digital channels (company intranet, HR platform, website) and training campaigns, and are presented to new employees during the onboarding process.

By implementing them, Gefran undertakes to comply with the laws governing the specific issues to which they relate. The Group is also committed to supporting the rights recognised in the Universal Declaration of Human Rights in its business relations in all the countries in which it operates.

Trafficking in human beings, as well as forced or compulsory labour and child labour, are topics not regarded as relevant in the impact, risk and opportunity assessment. Therefore, such topics are not explicitly covered by the policies available. Issues such as discrimination and political commitments relating to inclusion are stated in the policies adopted by the Group. Specifically:

/ The People in Gefran Policy expresses the principles of honesty, integrity and respect in the management of human capital, encouraging the active participation of all employees. It focuses on three essential aspects: respect for people, their empowerment, and the protection of diversity and of equal opportunities.

/ Together with the Code of Ethics and Conduct, it represents one of the bases for compliance with the SA 8000:2014 standard on Social Accountability, for which all the Group's Italian companies were certified at the end of 2023 (the plan to extend the same to foreign production sites is in progress).

/ Failure to comply with the principles stated in the Policy may give rise to some of the risks identified as material (described above), with particular reference to the risks of loss of opportunity and competitiveness related to attraction and retention issues. On the other hand, compliance with the Policy in the management of relations with Gefran's own workforce can increase the Group's attractiveness, favouring the entry of new talents and the maintenance of workers holding key functions.

/ The Health, Safety and Environment System Policy contains, among other things, the guidelines that all Group companies undertake to comply with in the area of health and safety. The objective is to harmonise the management of activities related to this topic, which is considered essential to

Initiatives focusing on people (welfare, smart working, support for families, training plans, opportunities for dialogue) have a positive impact on increasing the well-being and skills development of Gefran's own workforce. Some of these, such as plans supported by the corporate digital training hub (kenFLY), or different opportunities for dialogue, cover both employees and temporary workers. Other initiatives are typically focused only on the Group's employees.

(S1 ESRS 2 – SBM-3 14 a, b)

Risks

In the analysis of the material risks for Gefran, carried out without taking into account any mitigation actions already taken (so-called inherent risk), attention was paid to possible impacts and dependencies within its own workforce. Material risks related to attraction and retention issues were identified, in particular the risks of losses of opportunities and competitiveness, which might affect revenue generation, due to the inadequate strengthening of technical and sales force teams or inadequate and/or insufficient digital skills within the Group, which are necessary for the innovation of processes aimed at generating efficiency and/or meeting new market demands. These risks are mostly related to certain specific business areas, in particular technical and operational areas (R&D, Innovation, Operations) as well as the commercial area. (S1 ESRS 2 – SBM-3 14 d, 16)

Opportunities

The opportunities considered of material importance derive from the initiatives implemented by Gefran by putting its people at the centre (welfare, smart working, support for families, training plans, opportunities for dialogue), these representing not only a positive impact on their social sphere, but also an opportunity to increase the Group's attractiveness, promoting the entry of new talent and increasing the commitment of key workers. In addition, the training activities carried out within the Group are an opportunity for the development of key skills, which will ensure that Gefran remains competitive over time. They involve all the members of Gefran's workforce. (S1 ESRS 2 – SBM-3 14 d)

generate added value, for the benefit of all the Group's internal and external Stakeholders.

/ Failure to comply with the commitments set forth in the Policy might cause an increase in accidents in the Group and have an impact on the health of workers (albeit limited), resulting in possible loss of reputational value, regulatory non-compliance, and penalties, up to and including business interruptions.

In addition to the actions described in the dedicated paragraph (S1-4), they are implemented through the procedures provided for in Model 231 (ORGANISATION AND MANAGEMENT PROCEDURES MANUAL pursuant to Italian Legislative Decree 231/2001), with reference to the Procedure for the selection and recruitment of personnel and the Protocols for offences related to workplace safety.

The policies described are published on the Company's website for external Stakeholders and illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P included in the section General disclosures of this Report.

It should also be noted that no changes were made during 2025, as in 2024.

In addition, since 2022 Gefran has been participating in the United Nations Global Compact, the world's largest voluntary and at the same time strategic corporate citizenship initiative. The UN Global Compact requires companies and organisations endorsing it to share, support and implement a set of fundamental principles relating to human rights, labour standards, environmental protection and anti-corruption within their spheres of influence. These can be summarised in 10 principles. These are the same principles that have always distinguished the actions carried out within the Group and have made the Global Compact a natural landing place, also inspiring the definition of the Policies adopted.

S1-2 Processes for engaging with own workforce and workers' representatives about impacts

(ESRS 2 – MDR-P, 65 a, b, c, d, e) (S1-1, 19, 20 a, b, c, 21, 22, 23, 24)

Engaging Stakeholders is key to creating medium to long-term value, as it helps to identify future risks, challenges and opportunities. Gefran includes also its workforce in strategic discussions, using periodic materiality assessments to evaluate the Company's sustainability and define priorities. This approach has led to the creation of the Group's Strategic Sustainability Plan, the consistency of which is constantly monitored.

Gefran engages its own workforce in several ways:

/ with the organisation of events (in-person or digital) and information campaigns dedicated to the dissemination of Policies and Procedures, the sharing of strategic objectives and, more generally, knowledge of ESG

issues, which involve all workers;

/ with periodic meetings between the Company and trade union organisations;

/ with specific engagement events involving selected groups of workers representing all countries and categories, entailing several opportunities such as dedicated information-training sessions or the collection of opinions

and points of view (generally through surveys).

Engagement takes place whenever it is deemed necessary for the various activities (dissemination of a new Policy or Procedure, rather than at times when the Group considers it necessary to update the materiality assessment, for an adaptation of the organisational, external, regulatory or strategic context).

The operating methods are those typically used by Gefran in other processes, whose Owner, who is typically a Function manager (C-level), depends on the topic: in-person workshops and focus groups, digital events (video conferences, call conferences...) to reach all areas of the Group more effectively at the same time, multilingual digital platforms for the dissemination of information and training materials and moments of interaction (surveys, training through gamification...).

Stakeholder engagement activities aimed at materiality assessments are described in the section General disclosures - Impact, Risk and Opportunity Management - Materiality Assessment Process, IRO-1 of this Report, to which reference is made.

Gefran analysed the composition of its own workforce and did not find any particularly vulnerable categories of workers. The impacts identified were validated by senior management, i.e. the Chief People & Organization and Chief Executive Officer, experts in the business and internal workforce, before being assessed.

The Company promotes a continuous dialogue with employee representatives to integrate different perspectives, understand employee needs and expectations and guide human rights management and protection initiatives. Specific agreements are not necessary as they are included in national contracts, though constant cooperation with trade unions is maintained to ensure a respectful and inclusive working environment.

S1-3 Processes to remediate negative impacts

and channels for own workers to raise

concerns

Gefran manages its human capital, promoting diversity, inclusion and equal opportunities. It strives to create well-being, develop skills through training

and provide a safe and healthy work environment.

Gefran is committed to ensuring an ethical, inclusive, healthy and safe working environment for employees and workers of external companies operating in its plants. Health and safety are fundamental values, pursued through constant risk mapping and targeted actions to reduce them. Failure to pay attention to working conditions and to ensuring health and safety at work represents a negative material impact, as it affects the social sphere, causing possible accidents and potential repercussions on employees' health.

Policies, management method, targeted training and periodic investments have enabled Gefran to enrich its Integrated Management System, which now includes certification according to ISO 9001:2015 (Quality), ISO 14001:2015 (Environment), ISO 45001:2018 (Health and Safety at Work) and SA 8000:2014

(Social Accountability) standards.

As set forth in Italian Legislative Decree 231/2001, the Gefran S.p.A. Board has appointed a Supervisory Body (SB), consisting of two members working under specific regulations and with suitable means. Several communication channels have been activated to report violations of principles and procedures, including human and labour rights. For further details, please refer to the paragraph G1-1 Business conduct policies and corporate culture, included in the section Governance Information – Impact, Risk and Opportunity Management

of this Report.

Through the established channel, an anonymous report was received in 2025 (with reference to Gefran S.p.A.) concerning conduct between colleagues not related to any offences. An investigation was launched involving the company department concerned, which did not reveal the need to implement corrective actions, as the reported situation was promptly settled. At present, all

reported situations, including those prior to 2025, have been resolved.

(S1-2 27 a, b, c, d, 28)

(S1-3 32 a, b, c, d, e, 33)

S1-4 Taking action on material impacts on own workforce, and approaches to managing material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions

For Gefran, People come first. Protecting and valuing identity, points of view, diversity, quality and skills is fundamental to the Group's competitiveness and

success.

The strategy is carried out through the implementation of various actions and initiatives aimed at mitigating risks considered significant for the Group (relating to the retention and adequacy of its sales force, the strengthening of teams with insufficient STEM and digital skills, which are crucial for the innovation and efficiency of processes and to meet new market requirements), as well as the appropriate management of occupational health and safety, which represent not only a significant risk but also a negative impact.

Specifically, as regards occupational health and safety, Gefran identifies the actions to be implemented thanks to the constant monitoring of the risks associated with the operations of production staff and clerical staff. For further details please refer to the description of actions under Ensuring health and safety below.

Gefran's People-focused initiatives strengthen significant positive opportunities and impacts, increasing corporate attractiveness and encouraging the entry of new talent and the retention of key employees. Training activities develop essential skills that ensure Gefran's competitiveness over the medium to long term.

In general, Company initiatives that may affect employees are implemented in compliance with data protection laws.

Gefran implements various initiatives to strengthen employer branding and employee experience, such as onboarding, engagement and loyalty programmes. In Italy, Wellfran offers a package of flexible benefits accessible via its web portal. Employees can convert their performance bonus into goods and welfare services, enjoying tax and contribution benefits, as well as a company bonus of up to 10%. In other Countries where the Company operates with its own workforce, policies are adopted that improve the conditions laid down by law, according to the needs and social possibilities of the Country.

All Group employees are entitled to parental leave, which was used by 21 people in 2025, specifically 15 women and 6 men (in 2024, it was used by 29 people, specifically 16 women and 13 men). Employees returning from maternity leave can take part-time hours until their child is two years old. Employees

Annual Financial Report at 31 december 2025 Gefran Group

have access to a Healthcare Expenses Fund and 10 hours/year of paid leave for medical visits, personal appointments, or to accompany minor children or elderly family members.

Smart-working is available for compatible company departments. Production operators are offered flexible times, which improve their work-life balance while ensuring efficiency in production processes.

Gefran has always invested in People and in developing their skills, recognising the importance of individual contributions to the achievement of corporate objectives. The acquired skills then become corporate and individual assets, contributing to the Group's strategy. Many programmes, initiatives and partnerships with academic institutions and training schools have supported the development of business skills. Gefran pays great attention to personalised training in collaboration with universities, research centres and through the FLY Gefran Talent Academy. It also has a global digital platform to train skills, exchange experiences and knowledge.

27%

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

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Annual Financial Report at 31 december 2025 Gefran Group

Protecting diversity is one of the principles of business ethics; inclusion is one of its values. Gefran believes that people's uniqueness must be adequately valued and represents a strategic factor for the Group's growth, in a working environment where diversity (of gender or age, sexual or religious orientation, physical or technical skills, ethnic or cultural origins) generates dialogue, ideas and innovation. Diversity is a valuable strength that generates innovation and sustainable value.

Inclusion manifests itself in various forms, such as reverse mentoring programmes to enhance generational diversity, respect for food styles through meals served at work, the definition of an employee experience that takes into account diverse needs, and transparent career paths based on a shared skill matrix.

The stated commitment to the Group's employees, through the People in Gefran Policy described above, generally concerns the growth of every employee to the best of his or her talent, and this takes the shape, among others, of proposing cultural, dedicated and profiled content, taking into account cultural and generational diversity.

Gefran selects candidates in the international labour market and internally, with the experience and skills needed to implement the corporate strategy, referring to a shared skills matrix and applying a transparent, documented scouting process based on uniform methods, paradigms and procedures within the Group.

Gefran's remuneration policy enhances the skills and responsibilities of every employee in each country, through an integrated and consistent system of principles that is transparent and aimed at attracting, recognising, motivating and retaining talent.

The People&Organization corporate function, operating at a central level, coordinates the various activities described above, aimed at producing significant positive impacts on Gefran's own workforce, monitoring its effectiveness through the detection of Key Performance Indicators (KPIs). The results of the actions taken to recognising people and their qualities are reflected in the stability of the workforce. The exit turnover rate, calculated as the ratio of exits to the number of employees and excluding inter-company transfers, was equal to 7.6% in 2025 (8% in 2024).

Ensuring health and safety

Ensuring the health and safety of employees and external workers is a fundamental value of the Company. This is achieved by constantly mapping risks, monitoring their development and taking steps to minimise them.

In order to mitigate negative impacts and possible operating risks, such as those related to the handling of materials and products in unsuitable areas or the risks arising from accumulated storage, lean manufacturing principles are adopted in the Group's production areas. This approach consists of organising work islands based on the specificities of the assembly process of each product and clearly defining the areas for material handling, which are to be separate from storage areas.

In order to linearize flows, attention has been paid to the safe handling of materials and the reduction of ergonomic loads on operators. In reorganized areas, the application of the colour code for floor identification and marking continues, even going beyond the recommendations

of the OSHA 1910.144 standard, to visually outline work areas and storage positions. Production lines are periodically checked to assess their safety, and any necessary improvements are identified and implemented.

Particular attention is also paid to the conditions of buildings, and, in conjunction with the General Services area, maintenance or renovation plans are defined aimed at creating the best working conditions for operators and clerical staff, while also paying attention to energy performance.

Strengthening the culture of safety and health at work is an act of social accountability that takes the shape of specific training for workers, with differentiated pathways based on the risks associated with their activities. Policies, procedures and best practices are disseminated to all Group companies through periodic meetings and communication channels such as the website, the intranet and pinboards.

Gefran has chosen to rely on a team of professionals for health and safety training, ensuring insights with effective methods. The internal team supports the entire process, improving conduct exposed to risk, promoting the safety culture and adapting the organisation to the required standards.

A system of best practices is also implemented and extended to all Group companies. It provides, among other things, for regular meetings with the actors concerned to strengthen the culture of safety and health at work, which, in addition to being a regulatory obligation, is an important act of social accountability.

The path aimed at obtaining the certifications necessary to enrich the Integrated Management System for all the production companies of the Group falls within this context and is aimed at harmonising the operating mechanisms between the various Italian and foreign sites, considering all the aspects relevant to the business, of whatever nature they are, which have an impact on quality, safety, the environment or on social themes, and at promoting the development of continuous improvement processes.

The consolidated base, established by the ISO 9001:2015 (Quality) standard already adopted by Gefran, has made the System evolve so as to include the ISO 14001:2015 (Environment), ISO 45001:2018 (Health and Safety) and SA 8000:2014 (Social Accountability) requirements. Specifically, with regard to occupational health and safety controls, in the first quarter of 2023 the path was completed for all Italian sites with the obtaining of a third-party

294 295

certification of compliance with the ISO 45001 standard. During the last two years, the activities necessary to structure the Integrated Management System in foreign branches were carried out, with the support of professionals experienced in the regulations applying in the various countries, in preparation for certification audits conducted by third parties. The audits were carried out in December 2025 and January 2026, allowing the production sites in China, the United States and Switzerland to integrate the Management System and also be ISO 14001:2015 and ISO 45001:2018 certified by third parties.

The effectiveness of health and safety policies and practices is confirmed by the reduced number of accidents reported: in 2025, only 1 accident was recorded in the Group, to the detriment of an employee of Gefran S.p.A. (the Group's main production hub) who suffered a superficial cut during assembly operations. Accidents recorded in the Group in previous years were also not significant: in 2024 there were 2 accidents (involving an employee and a non-employee), while in 2023 there were 4 accidents (all involving employees).

(S1-4 37, 38 a, b, d, 39, 40 a, b, 43) (ESRS 2 – MDR-P, 65 d) (ESRS 2 – MDR-A 68, c)

Respect for human rights

Gefran promotes actions inspired by honesty, integrity and respect. It protects and promotes human rights and is committed to upholding the rights recognised in the Universal Declaration of Human Rights in its business relationships in all the countries in which it operates, to which specific reference is made in the various Policies inspiring the Group's activities.

Corporate policies, such as the Code of Ethics and Conduct and the People in Gefran policy (described in the paragraph Impact, Risk and Opportunity Management – Policies and actions – MDR-P in the section General disclosures of the Report), as well as the Gefran Way policy (illustrated in the section Governance Information) explicitly set out the values pursued by the Gefran Group, including respect for human rights, protection of diversity and equal opportunities.

As set forth in Italian Legislative Decree 231/2001, the Gefran S.p.A. Board has appointed a Supervisory Body (SB), consisting of two members working under specific regulations and with suitable means. Several communication channels have been activated to report violations of principles and procedures, including human and labour rights. For further details, please refer to the section Governance information – Impact, Risk and Opportunity Management, G1-1 of this Report.

Anyone who becomes aware of possible breaches of the rules and principles established by the Code of Ethics and Conduct, also in relation to human rights, is required to report them to the Supervisory Body in the manner provided for by the Organisational, Management and Control Model pursuant to Italian Legislative Decree 231/2001 (known as Model 231). The Supervisory Body liaises with the competent company bodies and departments for the correct implementation and adequate control of the Principles set out in the Code of Ethics and Conduct and other existing Policies.

In order to facilitate reports to the SB by subjects who become aware of violations of the Model, even potential ones, dedicated communication channels have been provided, as laid down in the Whistleblowing Procedure of the Gefran Group. For further details, please refer to the section Governance information– Impact, Risk and Opportunity Management, G1-1 of this Report.

Any measures and/or sanctions (of any kind) relating to violations of the Code, and therefore also of the human rights to which specific reference is made, will be adopted by the competent bodies on the basis of applicable legislation, the internal disciplinary system and the provisions of national collective agreements (where recognised by law). (S1-4 37, 38 a, b, d, 39, 43)

Metrics and targets

S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and

opportunities

Protecting the People who make up the workforce, enhancing their identity, points of view, diversity, quality and skills represents a set of essential elements for the Group's competitiveness and success. The challenge is to provide a working environment that respects the ethical principles of the company, is inclusive and safe and supports personal, technical and professional growth.

Gefran's commitments are embodied in the Strategic Sustainability Plan, formalised in 2022, which is now an integral part of the strategy launched, and which aims to achieve objectives, also in relation to workforce management, in line with the political commitments and areas related to the relevant IROs.

The process began by analysing Gefran's positioning and the risks/opportunities of the market. Discussions were held with Stakeholders, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management participated at all levels to define projects, set objectives and determine performance indicators. We then verified the consistency of the targets with the relevant IROs, ensuring the coverage of each important topic. Stakeholders were involved in identifying the relevant impacts, risks and opportunities.

Targets relate to Gefran's activities (skills development, ensuring health and safety in the workplace, compliance with recognised standards, cybersecurity and data privacy), and are defined according to the scope of the projects launched and the time horizon defined. Time horizons are generally medium-term though project-specific (intermediate objectives have not been set for the time being).

Annual Financial Report at 31 december 2025 Gefran Group

In particular, the targets relating to training and the promotion of a culture of safety cover all Group companies, extending to the countries in which Gefran operates directly. More specific targets are defined for the Group's main Italian Companies, where most employees are based (as at 31 December 2025, 65.1% of the Group's employees are employed by Gefran S.p.A., Gefran Soluzioni S.r.l. and Elettropiemme S.r.l).

In general, periodic monitoring of key indicators makes it possible to verify the effectiveness of actions and to highlight progress over time (measurement started in 2023). Progress is highlighted during regular alignment meetings with the functions in charge of strategy execution, and KPIs measuring the effectiveness of the actions implemented against defined targets are collected at least annually. Findings are shared at Sustainability Committee meetings, during which the performance identified against the defined targets is analysed and targets are reviewed if necessary.

Below are the projects envisaged in the Strategic Sustainability Plan, in relation to own workforce topics, the targets 12 defined and the progress achieved in 2025.

12 The targets are set voluntarily on the basis of monitoring metrics and internal considerations, without the support of scientific data. The targets related to the waste topic mainly refer to prevention and preparation for re-use.

Projects	Targets	Progress made in 2025
Develop training plans	By 2026, train 90% of employees inskills that are crucial to Gefran's development in the coming years.	91.9% () of employees at Group level hadaccess to training on key competenciesfor the Group, through the dedicated kenFLY platform (90.4% in 2024 and 82.9% in2023). Thanks to specific technical training or cross-cutting skills programmes,the average hours of training peremployee are 11.7 (13.5 in 2024 and 17.3 in2023). From 2026, Gefran will continue itsdevelopment and training activities, aimedat strengthening employees' skills on specific topics considered fundamental forthe execution of the Group's strategy.() does not include training activities covered by otherprojects (i.e., HSE and cybersecurity)
Deliver a sustainabilitytraining plan	By 2026, involve 80% of employeesin training activities on ESG issues,tailored to the needs of companydepartments.	100% of employees at Group level haveaccess to ESG training, through the dedicated Sustainability Hub platform withinkenFLY, with content available in the 6 languages spoken in the Group. From 2026,Gefran will continue its development andtraining activities, aimed at strengtheningemployees' skills on specific topics considered fundamental for the execution ofthe Group's strategy.
Integrate ESG goals intoannual MBOs and allmanagers' LTI Plans	Maintain, for managers directly involvedin the execution of the Strategic Plan,an assessment system that integratesthe achievement of ESG objectives.	88.9% of the managers involved in theexecution of the Strategic Plan have atleast one ESG goal in their MBO/LTI planevaluation sheet, and the value achievedrepresents 95.3% of the maximum valueallocated and linked to ESG goals.
Integrate ESG into clericalstaff's and manualworkers' performancebonus	For clerical staff and manual workerswith a supplementary contract, keep apart of the result premium tied to theachievement of ESG objectives.	5.1% of the result premium allocated foremployees with a supplementary contract(Gefran Spa and Gefran Soluzioni) wasachieved following the reaching of ESGobjectives (1.9% in 2024).
Create a community onD&I	Create a space dedicated to the D&Icommunity on the kenFLY platform topromote opportunities for discussionand training and to promote diversityand inclusion values at all levels.By 2028, reach 80% of employeesthrough access to such space.	13.2% of employees at Group levelreceived content from the D&I section ofthe kenFLY platform (6.6% in 2024).

ANNUAL FINANCIALREPORT	HIGHLIGHTS	REPORT ON OPERATIONS –PROFILE OF THE GROUP	REPORT ON OPERATIONS -INFORMATION ON ACTIVITIES	REPORT ON OPERATIONS –DISCLOSURE OF RISKSAND UNCERTAINTIES TO WHICHTHE GEFRAN GROUP IS EXPOSED	REPORT ON OPERATIONS –SUSTAINABILITY REPORT	CONSOLIDATEDFINANCIAL STATEMENTS
	298				299
Boost female access toSTEM disciplinesIntroduce an IntegratedManagement System toharmonise the operatingstandards of Groupcompanies	Start an educational campaign in localschools.Complete the implementation of theIntegrated Management System forthe Group's production Companies (),progressively aligning also the newlyacquired sites. In 2026, alignmentwith the SA 8000 standard will becompleted for the sites in China andSwitzerland, and work to align the mainprocesses of CZ Elettronica S.r.l. withthose of the Group will begin.() Production sites in Italy, Switzerland, the UnitedStates and China are included in the scope; at	A first project was carried out, aimed atcreating innovative educational pathwaysin the STEM field, with a practical, inclusive, immersive and laboratory approach.Eleven schools in the area were involved,with a total of 559 students from lowersecondary schools taking part.Alignment with the requirements of ISO45001 and ISO 14001 standards wascompleted and the related certificationwas achieved, also at foreign productionsites, in addition to the standards alreadyintegrated into the Group.	WomenMenOther	S1-6 Characteristics of the undertaking'semployeesThe reporting of data on the characteristics of the company's employees, aswell as all the following metrics reported, was carried out involving all companies in the Gefran Group in the collection of accurate data, as describedin the specific Procedure governing this Report. The data collected by eachentity are aggregated and analysed by the Corporate contacts for own workforce-related topics (typically the P&O function, and the Q-HSE function forhealth and safety). It should be noted that the scope used for 2025 reportingis different from that used for the previous year, due to the entry into theGroup of CZ Elettronica S.r.l., as described in Significant events in 2025.The tables below show the characteristics of Gefran employees.Exact number of employees by gender	20242584410	20252714770
	present, the site in Brazil is excluded, where only operational activities for the assembly of semi-finishedproducts made in Italy are carried out		Total	Undisclosed	0699	0748
Promote a culture ofsafety	Reach the Group's zero injuries target() by 2025.() The objective will be considered achieved if theseverity index (number of days lost due to accidents x1,000 / hours worked) =< 0.01	Severity index close to 0 in 2025: 1 minorinjury occurred, resulting in 3 working dayslost (in 2024 it was 0.01; in 2023 it was0.04).		The number of employees shown above represents the exact number of persons at the end of the reporting period.
				Exact number of employees by country	2024	2025
Train employees on IT	Repeat the training on cyber and	The new training plan was defined and	Italy		471	510
risks	cybersecurity risks, involving all Group	launched, which will involve all Group	Belgium		15	17
	employees by 2026.	employees (Italian and foreign) using company devices in 2026	FranceGermany		824	830
			UK		2	2
Minimise IT risk	Keep IT risk at or below level 3.5, which	Cyber risk level at 3.28 (3.92 in 2024, 4.22		Switzerland	16	18
	is considered medium-low.	in 2023).		United States	34	36
			Brazil		37	41
				Singapore	8	8
				China (People's Republic)	60	54
			India		24	24
				Total number of employees	699	748

(ESRS 2 - MDR-T, 80, a, b, c, d, e, f, g, h, i, j) (ESRS 2 - MDR-T 81) (ESRS 2 - MDR-A, 68 a, b, c, d, e) (ESRS 2 – MDR-M, 75, 77)

Annual Financial Report at 31 december 2025 Gefran Group

Average number of employees	2024		2025 Change 2025-2024
January	694	716	3.2%
February	692	715	3.3%
March	687	720	4.8%
April	688	740	7.6%
May	688	744	8.1%
June	693	746	7.6%
July	693	751	8.4%
August	690	745	8.0%
September	693	752	8.5%
October	691	757	9.6%
November	696	758	8.9%
December	699	748	7.0%
Average number of employees	692	741	7.1%

		Men		Women			Other Undisclosed			Total
Exact number of employees bycontract type and gender			2024 2025 2024 2025 2024 2025 2024 2025 2024 2025
Total number of employees	441	477	258	271	0	0	0	0	699	748
Number of open-ended
employees	434			464	255	263	0	0	0	0	689	727
Number of fixed-term employees	7	13	3	8	0	0	0	0	10	21
Number of employees with
variable working hours	0	0	0	0	0	0	0	0	0	0
Number of full-time employees	439	473	226	232	0	0	0	0	665	705
Number of part-time employees	2	4	32	39	0	0	0	0	34	43

		Italy		Europe(ExcludingItaly)		America			Asia Rest of the	world		Total
Exact number ofemployees by contracttype and region											2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025
Total number ofemployees	471	510	65	75	71	77	92	86	0		0 699 748
Number of open-endedemployees		468 506	65	75	70	76	86	70	0		0 689	727
Number of fixed-termemployees	3	4	0	0	1	1	6	16	0	0	10	21
Number of employeeswith variable workinghours	0	0	0	0	0	0	0	0	0	0	0	0
Number of full-timeemployees	449	479	53	63	71	77	92	86	0		0 665	705
Number of part-timeemployees	22	31	12	12	0	0	0	0	0	0	34	43

Employees who left the Group	2024		2025 Change 2025-2024
Number of employees who left the Company	56	57	1.8%
Employee turnover rate	8.0%	7.6%	-4.9%

During 2025, 57 people left the Group (56 in 2024), of whom 25 left voluntarily while 8 retired (33 and 12 in 2024, respectively). The remaining people left for other reasons, including conclusion of their (open-ended or fixed-term)

employment contract. (S1-6 50, a, b, c, 50 d i, d ii, 51)

Annual Financial Report at 31 december 2025 Gefran Group

Breakdown of changes in employees, by Group Company

		Men		Women		Total
Exact number of employees by Company and gender	2024	2025	2024	2025	2024	2025
Total number of employees	441	477	258	271	699	748
Gefran Spa	213	222	171	175	384	397
Gefran Soluzioni Srl	45	42	9	11	54	53
Elettropiemme Srl	30	34	3	3	33	37
CZ Elettronica Srl	0	21	0	2	0	23
Gefran Benelux Nv	9	11	6	6	15	17
Gefran France S.A.	7	7	1	1	8	8
Gefran Deutschland Gmbh	17	22	7	8	24	30
Gefran UK Ltd	1	1	1	1	2	2
Gefran Schweiz AG	13	14	3	4	16	18
Gefran Inc	23	21	11	15	34	36
Gefran Brasil Elettroel. Ltda	26	27	11	14	37	41
Gefran Asia Pte Ltd	4	4	4	4	8	8
Gefran Automation Technology Co. Ltd	32	30	28	24	60	54
Gefran India Private Ltd	21	21	3	3	24	24

		Men		Women		Total
NEW HIRES	2024	2025	2024	2025	2024	2025
Total number of employees	65	78	39	28	104	106
Gefran Spa	24	22	32	11	56	33
Gefran Soluzioni Srl	5	0	2	3	7	3
Elettropiemme Srl	7	8	0	0	7	8
CZ Elettronica Srl	0	22	0	2	0	24
Gefran Benelux Nv	0	2	1	0	1	2
Gefran France S.A.	1	0	0	0	1	0
Gefran Deutschland Gmbh	2	7	0	1	2	8
Gefran UK Ltd	0	0	0	0	0	0
Gefran Schweiz AG	4	2	0	1	4	3
Gefran Inc	6	0	1	4	7	4
Gefran Brasil Elettroel. Ltda	8	8	0	4	8	12
Gefran Asia Pte Ltd	0	0	0	0	0	0
Gefran Automation Technology Co. Ltd	4	5	3	2	7	7
Gefran India Private Ltd	4	2	0	0	4	2

		Men		Women		Total
LEAVERS	2024	2025	2024	2025	2024	2025
Total number of employees	44	44	12	13	56	57
Gefran Spa	10	13	3	7	13	20
Gefran Soluzioni Srl	5	3	1	1	6	4
Elettropiemme Srl	8	4	0	0	8	4
CZ Elettronica Srl	0	1	0	0	0	1
Gefran Benelux Nv	1	0	0	0	1	0
Gefran France S.A.	1	0	0	0	1	0
Gefran Deutschland Gmbh	3	2	1	0	4	2
Gefran UK Ltd	0	0	0	0	0	0
Gefran Schweiz AG	4	1	1	0	5	1
Gefran Inc	6	2	2	0	8	2
Gefran Brasil Elettroel. Ltda	3	7	1	1	4	8
Gefran Asia Pte Ltd	0	0	0	0	0	0
Gefran Automation Technology Co. Ltd	3	9	3	4	6	13
Gefran India Private Ltd	0	2	0	0	0	2

This figure for the year 2025 includes the addition to the Group of the newly acquired company CZ Elettronica S.r.l., with a staff of 23 employees at the

acquisition date.

The change also includes the stabilisation of 10 temporary workers (in Italy), which took place in early 2025.

S1-7 Characteristics of non-employee workers in the undertaking's own workforce

Below are the metrics 13 on the characteristics of non-employees of Gefran.

Number of non-employees in the own workforce	2024	2025
Total number of non-employees	46	42
Self-employed persons	2	2
Workers made available by undertakings mainly engaged in the"recruitment, selection and supply of personnel"	44	40

The number of non-employees shown above represents the exact number of persons at the end of the reporting period. In this case, only temporary workers and self-employed workers who are not employees are taken into consideration, since, without their role within the company, they would not have a replacement.

Characteristics of the undertaking's employees.

(S1-7 55 a, b i, b ii)

13 The reporting of data on the characteristics of non-employees included in the Company's own workforce was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6

REPORT ON OPERATIONS – SUSTAINABILITY REPORT

304 305

Annual Financial Report at 31 december 2025 Gefran Group

S1-8 Collective bargaining coverage and social dialogue

14 The reporting of data on collective bargaining coverage and social dialogue was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

The tables below show the metrics14 on Gefran's collective bargaining coverage and social dialogue.

Percentage of employees covered by collectiveagreements	2024	2025	Change2025-2024
Total employees	699	748	7.0%
Employees covered by collective agreements	555	585	5.4%
Percentage of employees covered by collectiveagreements	79%	78%	-1.5%

Specifically, collective agreements and social dialogue policies cover all Group employees in the countries where Gefran is present with its offices and where such contracts are provided for (ltaly, Germany, Belgium, France and Brazil).

With regard to Italy, the only country in the European Economic Area (EEA) where Gefran has significant employment levels (i.e. at least 50 employees representing not less than 10% of total employees), 100% of employees are represented by employee representatives.

Percentage of employees represented byemployee representatives	2024	2025	Change2025-2024
Total employees	471	510	8.3%
Employees represented by employee representatives	471	510	8.3%
Percentage of employees represented by employeerepresentatives	100%	100%	0.0%

			2024			2025
		Collective bargaining	coverage Social dialogue		Collective bargaining	coverage Social dialogue
Coverageratio	Employees- EEA(for countrieswith > 50employeesrepresenting> 10 % of totalemployees)	Employees- non-EEA(by region)	Representationat the workplace(EEA only)(for countrieswith > 50employeesrepresenting> 10 % of totalemployees)	Employees- EEA(for countrieswith > 50employeesrepresenting> 10 % of totalemployees)	Employees- non-EEA(by region)	Representationat the workplace(EEA only)(for countrieswith > 50employeesrepresenting> 10 % of totalemployees)
0-19%		Asia			Asia
20-39%
40-59%		America			America
60-79%
80-100%	Italy		Italy	Italy		Italy

(S1-8 60 a, b, c, 63 a) (S1-8 AR 70)

S1-9 Diversity metrics

The tables below show Gefran's diversity metrics**15**.

					2025
Number and percentage ofTop Management members:	Men	Women		Other Undisclosed	Total
Top Management (number ofpeople)	75	18	0	0	93
Top Management (percentage)	81%	19%	0%	0%	100%

Number and percentage of

					2024
Number and percentage ofTop Management members:	Men	Women		Other Undisclosed	Total
Top Management (number ofpeople)	74	15	0	0	89
Top Management (percentage)	83%	17%	0%	0%	100%

Top Management (number of

It should be noted that Top Management includes employees classified as

Managers and Middle Managers.

15 The reporting of data on diversity was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

Annual Financial Report at 31 december 2025 Gefran Group

Diversity by classification

					2025
Exact number of employees byclassification and gender	Men	Women		Other Undisclosed	Total
Managers	25	4	0	0	29
Middle managers	50	14	0	0	64
Clerical staff	290	123	0	0	413
Manual workers	112	130	0	0	242
Total employees	477	271	0	0	748

					2024
Exact number of employees byclassification and gender	Men	Women		Other Undisclosed	Total
Managers	24	4	0	0	28
Middle managers	50	11	0	0	61
Clerical staff	255	117	0	0	372
Manual workers	112	126	0	0	238
Total employees	441	258	0	0	699

Diversity by age group

					2025
Exact number of employees byclassification and gender	Men	Women		Other Undisclosed	Total
less than 30 years old	58	24	0	0	82
30 to 50 years old	271	171	0	0	442
over the age of 50	148	76	0	0	224
Total employees	475	273	0	0	748

					2024
Exact number of employees byclassification and gender	Men	Women		Other Undisclosed	Total
less than 30 years old	46	32	0	0	78
30 to 50 years old	256	162	0	0	418
over the age of 50	139	64	0	0	203
Total employees	441	258	0	0	699

S1-10 Adequate wages

16 The reporting of data on adequate wages, social protection and people with disabilities was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of

the undertaking's employees.

17 The reporting of data on social protection was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

18 The reporting of data on disability was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

The analysis**16** shows that Gefran employees receive adequate wages, in accordance with the reference standards.

(S1-10 69)

S1-11 Social protection

All employees are covered by social protection 17 both through public programmes and through programmes offered by the Company which further improve what is envisaged by public programmes.

(S1-11 74 a)

S1-12 Persons with disabilities

At December 31, 2025, 18 employees with disabilities**18** were part of the Group,

all in Italy.

Percentage of employees with disabilities in Gefran's ownworkforce	2024	2025	Change2025-2024
Number of employees with disabilities in Gefran's own workforce	18	20	11.1%
Total employees	699	748	7.0%
Percentage of employees with disabilities	3%	3%	3.8%

(S1-12 79)

(S1-9 66, a, b) (S1-9 AR 71)

Annual Financial Report at 31 december 2025 Gefran Group

S1-13 Training and skills development metrics

19 The reporting of data on training and skills development was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

Below are the tables for the representation of Gefran's metrics**19** on this topic.

									Total
2024
23.0	19.0	13.2	11.1	-	-	-	-	19.4	16.1
	Average number of training hours	Men		Women				Other Undisclosed	2025 2024 2025 2024 2025 2024 2025 2024 202513.8% 8.4% 12.4% 3.3% 0.0% 0.0% 0.0% 0.0% 13.3% 6.6%

					2025
Percentage of employeeswho participated in periodicperformance and careerdevelopment reviews byemployee category and gender	Men	Women		Other Undisclosed	Total
Managers	16.0%	0.0%	0.0%	0.0%	13.8%
Middle managers	6.0%	21.4%	0.0%	0.0%	9.4%
Clerical staff	11.4%	4.9%	0.0%	0.0%	9.4%
Manual workers	0.0%	0.0%	0.0%	0.0%	0.0%
Total employees	8.4%	3.3%	0.0%	0.0%	6.6%

					2024
Percentage of employeeswho participated in periodicperformance and careerdevelopment reviews byemployee category and gender	Men	Women		Other Undisclosed	Total
Managers	16.7%	0.0%	0.0%	0.0%	14.3%
Middle managers	54.0%	54.5%	0.0%	0.0%	54.1%
Clerical staff	8.6%	15.4%	0.0%	0.0%	10.8%
Manual workers	7.1%	6.3%	0.0%	0.0%	6.7%
Total employees	13.8%	12.4%	0.0%	0.0%	13.3%

Average number of traininghours by category of	Men	Women		Other Undisclosed	2025Total
employees and genderManagers	10.9	16.5	-	-	11.7
Middle managers	19.7	14.1	-	-	18.4
Clerical staff	21.4	16.2	-	-	19.9
Manual workers	14.0	5.8	-	-	9.6
Total employees	19.0	11.1	-	-	16.1

Average number of traininghours by category ofemployees and gender

					2024
Average number of traininghours by category ofemployees and gender	Men	Women		Other Undisclosed	Total
Managers	27.8	9.9	-	-	25.3
Middle managers	41.9	55.5	-	-	44.3
Clerical staff	18.8	12.3	-	-	16.7
Manual workers	23.3	10.5	-	-	16.5
Total employees	23.0	13.2	-	-	19.4

Type of training

Miscellaneous training programmes have involved Group employees, for which the hours carried out (in 2025 and 2024) are shown below.

			2025
Number of hours of technicaltraining	Men	Women	Total
Managers	152	40	192
Middle managers	768	119	887
Clerical staff	3,095	1,023	4,118
Manual workers	348	280	628
Total training hours	4,363	1,462	5,824

			2024
Number of hours of technicaltraining	Men	Women	Total
Managers	74	14	88
Middle managers	1,004	138	1,142
Clerical staff	2,294	742	3,035
Manual workers	931	691	1,622
Total training hours	4,302	1,584	5,886

310 311

		2025
Men	Women	Total
		110
		149
		2,397
		307
2,173	789	2,962
	90941,712278	205568529

			2024
Training hours ondevelopmentof cross-functional skills	Men	Women	Total
Managers	514	26	540
Middle managers	739	273	1,012
Clerical staff	1,057	417	1,473
Manual workers	496	-	496
Total training hours	2,805	716	3,521

S1-14 Health and safety metrics

Below are the tables for the representation of Gefran's metrics**20** on this topic.

			2024			2025
	Employees	Non		Total Employees	Non	Total
Number of people in the		employees			employees
undertaking's own workforce
covered by its health and safety
management system based	699	46	745	748	42	790
on legal requirements and/or
recognised standards
Number of persons in the
undertaking's own workforce
covered by a health and safety
management system based
on legal requirements and/	428	30	458	595	35	630
or recognised standards or
guidelines and which has been
internally audited and/or audited
or certified by an external party
Number of people in the	699	46	745	748	42	790
undertaking's own workforce
Percentage of people in the
undertaking's own workforce
covered by its health and safety	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%
management system based
on legal requirements and/or
recognised standards
Percentage of persons in the
undertaking's own workforcecovered by a health and safety
management system based
on legal requirements and/	61.2%	65.2%	61.5%	79.5%	83.3%	79.7%
or recognised standards or
guidelines and which has been
internally audited and/or audited
or certified by an external party

It should be noted that the number of people in the undertaking's workforce covered by a health and safety management system based on legal requirements and/or recognised standards and/or guidelines and which has been audited relate to all workers in Italy, Switzerland, China and the United States (with reference to the third-party audit under the ISO 45001:2018 standard).

			2025
Hours of Occupational Healthand Safety training	Men	Women	Total
Managers	40	-	40
Middle managers	95	33	128
Clerical staff	1,416	282	1,698
Manual workers	954	446	1,400
Total training hours	2,505	761	3,266

			2024
Hours of Occupational Healthand Safety training	Men	Women	Total
Managers	80	0	80
Middle managers	352	199	551
Clerical staff	1,438	284	1,722
Manual workers	1,178	634	1,812
Total training hours	3,048	1,117	4,165

(S1-13 83 a, b)

20 The reporting of data on health and safety was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

The Group has been carrying out structured reporting of health and safety indicators since 2017 and specifies that, within the time frame mapped, there were no fatalities in its own workforce caused by work-related injuries or recordable work-related ill-health.

The rate of work-related injuries in the undertaking's own workforce is shown below:

(S1-14 88, b)

			2024			2025		Change 2025-2024
	Employees	Nonemployees Total Employees			Nonemployees Total Employees			Nonemployees	Total
Number ofworking dayslost as a resultof injuries dueto work-relatedaccidents	5	10	15	3	-	3	-40.0%	-100.0% -80.0%
Number ofworking dayslost as a resultof work-relatedfatalities	-	-	-	-	-	-	n.a.	n.a.	n.a.
Number of dayslost as a result ofwork-related illhealth	-	-	-	-	-	-	n.a.	n.a.	n.a.
Number of dayslost as a result offatalities due towork-related illhealth	-	-	-	-	-	-	n.a.	n.a.	n.a.
Number of dayslost as a resultof work-relatedinjuries andfatalities dueto work-relatedinjuries, casesof work-relatedill health andfatalities due towork-related illhealth	5	10	15	3	-	3	-40.0%	-100.0% -80.0%

			2024			2025		Change 2025-2024
	Employees	Nonemployees		Total Employees	Nonemployees		Total Employees	Nonemployees	Total
Totalhoursworked	1,187,854			73,912 1,261,766 1,198,961		69,935 1,268,895	0.9%		-5.4% 0.6%
Numberof workrelatedinjuriesin theundertaking'sownworkforce	1	1	2	1	-	1	0.0%	-100.0% -50.0%
Rate ofworkrelatedinjuriesin theundertaking'sownworkforce	0.84	13.53	1.59	0.83	-	0.79	-0.9%	-100.0% -50.3%

(S1-14 88 a, c, e)

S1-15 Work-life balance metrics

21 The reporting of data on work-life balance, such as on remuneration (pay gap and total remuneration), was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

Below are the tables for the representation of Gefran's metrics 21 on this topic.

All Group employees are entitled to family-related leave through social policy and/or collective labour agreements.

					2025
Percentage of employeesentitled to family-relatedleave	Men	Women		Other Undisclosed	Total
Employees who are entitled tofamily-related leave	477	271	0	0	748
Employees making use of familyrelated leave	6	15	0	0	21
Total employees	477	271	0	0	748
Percentage of employees entitledto make use of family-relatedleave	100%	100%	0%	0%	100%

					2024
Percentage of employeesentitled to family-relatedleave	Men	Women		Other Undisclosed	Total
Employees who are entitled tofamily-related leave	441	258	0	0	699
Employees making use of familyrelated leave	13	16	0	0	29
Total employees	441	258	0	0	699
Percentage of employees entitledto make use of family-relatedleave	100%	100%	0%	0%	100%

It should be noted that significant events are tracked, in particular mandatory and early maternity leave, and paternity leave that is either mandatory or optional (not by the hour). Non-significant events (e.g. maternity periods lasting less than 10 days in total) are excluded from the indicator.

(S1-15 93 a, b, 94)

S1-16 Compensation metrics (pay gap and total compensation)

Characteristics of the undertaking's employees.

Below are the tables for the representation of Gefran's metrics**22** on this topic.

Gender pay gap23	2024	2025	Change2025-2024
Managers	0%	10%	-1%
Middle managers	13%	17%	36%
Clerical staff	21%	20%	-8%
Manual workers	10%	9%	-11%
Gender pay gap	16%	26%	59%

	2024	2025	Change2025-2024
Total annual remuneration report 24	13.64	13.31	-2.5%

The data presented are the result of an accurate and structured collection of information managed through the various HR systems implemented across all Group companies and by the central P&O function.

Please note that the 2024 figures have been modified compared to those published in the previous Sustainability Report, following the change in methodology. In 2024, the indicator was calculated as the ratio between the average gross annual base salary (excluding the variable portion) of female employees and that of male employees in individual Group companies, for each category. The Group indices are calculated by weighting the indices of individual companies by the number of employees in each category, where applicable. The Group average is determined as the average of each category, weighted by the number of employees, where applicable, obtaining the following values by category and total: Managers 100%, Middle managers 87.2%, Clerical staff 78.7%, Manual workers 90.0%, Total gender pay gap 83.6%.

(S1-16 97 a, b)

22 The reporting of data on work-life balance, such as on remuneration (pay gap and total remuneration), was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6

23 The gender pay gap is calculated using the following formula: (average GPA for full-time male employees average GPA for full-time female employees) / average GPA for full-time male employees, for each job level. Group ratios are weighted based on the number of employees per company and job level, and the overall average is the weighted average of the ratios by job level, where applicable. It should be noted that it was not possible to use the average hourly GPA in the calculation; however, the Group will commit to reporting this indicator more comprehensively in future years. 24 In calculating the total remuneration ratio, all Group employees were included, taking into account all aspects of remuneration (including the variable share) and comparing the total annual remuneration for the highest paid person in the Company with the median total annual remuneration of employees (excluding the highest paid person).

S1-17 Incidents, complaints and severe human rights impact

25 The reporting of data on incidents, complaints and severe human rights impact was carried out involving all Group companies and in accordance with what is described with reference to metric S1-6 Characteristics of the undertaking's employees.

It should be noted that there have never been any incidents, complaints or severe human rights impacts within the Group, as also highlighted in the table below**25**.

Number of incidents of discrimination	Unit ofmeasurement	2024	2025
Number of incidents of discrimination, including
harassment		0	0
Number of complaints filed through channels for people
in the undertaking's own workforce to raise concerns	number	0	0
Number of grievances submitted to National Contact
Points for OECD Multinational Enterprises		0	0
Amount of fines, penalties, and compensation for
damages as a result of the incidents and complaints set	monetary value	0	0
out above
Number of severe human rights issues and incidents
connected to the undertaking's workforce		0	0
Number of severe human rights issues and incidents
connected to the undertaking's own workforce,	number
amounting to cases of non-respect of the UN Guiding		0	0
Principles and the OECD Guidelines for Multinational
Enterprises
Total amount of fines, penalties and compensation for
the incidents described above	monetary value	0	0
Number severe human rights incidents where the
undertaking played a role securing remedy	number	0	0

(S1-17 103, a, b, c, d, 104 a, b)

It should be noted that, as described in the section General disclosures – Criteria for preparation of this Report, at paragraph BP2 Disclosure in relation to specific circumstances, some of the phase-in measures provided

for in ESRS 1 – Appendix C are adopted when preparing the sustainability report. Specifically, Gefran provides partial disclosure on social issues, in relation to the requirements of ESRS S2 on Workers in the value chain.

Strategy

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

Gefran pays special attention to social aspects, including impacts, risks and opportunities arising from its activities, addressing also the value chain. In conducting the double materiality assessment, Gefran considered the activity carried out by the Group, the type of materials handled and of products made, as well as the geographical distribution of such activities and the main players in its upstream and downstream chain. Value chain mapping was carried out according to the principle of materiality, taking into account two main drivers: expenditure and products sold by the Group. The objective was to understand the main products purchased, the geographical distribution of the major suppliers and the sectors served, based on information already available. For a description of the main characteristics of the Gefran value chain, please refer to the paragraph SBM-1 Strategy, business model and value chain included in the section General disclosures – Strategy of this Report.

In order to identify the relevant IROs connected with workers in the value chain, in addition to the internal functions directly involved, the Group's Top Management and Governance, the main Stakeholders affected were also involved. Consultation sessions were held during 2024 with local supply chain representatives. During these sessions, information useful to the evaluation of the IROs identified was shared and indications were collected through questionnaires. As with other topics covered, the analysis of risks related to the working conditions of employees along the chain was initiated through the Enterprise Risk Management process already implemented in the Company, focusing specifically on the risks relating to the topics and sub-topics set out by ESRS S2. For further details on the process conducted, please refer to the paragraph IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities included in the section General disclosures – Impact, Risk and Opportunity Management – Materiality Assessment Process of this Report.

The analysis, which focused on working conditions and safety in the workplace, revealed a single significant negative impact linked to workers in the chain.

Annual Financial Report at 31 december 2025 Gefran Group

The assessment underlined that neglecting safety aspects, and more generally the working conditions of employees along the supply chain, may cause accidents and health issues for workers, adversely affecting the social sphere generally.

The potential negative impacts and risks associated with incidents relating to poor quality of work environments, human rights, child labour and forced labour were also examined. However, these issues were regarded as immaterial, also due to the geographical distribution of the supply chain, mainly located in countries generally not exposed to these problems due to the presence and application of the relevant regulations.

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
WORKINGCONDITIONS	Failure to payattention to workingconditions and tothe management ofhealth and safety atwork along the supplychain may causeaccidents and/orinjuries at work to thedetriment of workers

Impact, risk and opportunity

management

S2-1 Policies related to value chain workers

Gefran has adopted the Code of Ethics and Conduct, with which it undertakes to conduct its business, both internal and external, in compliance with applicable laws and market rules and observing universally recognised ethical principles. The latter provide a clear benchmark for anyone working with the Group, including workers in its own chain: observance of the declared principles is the fundamental condition for starting and/or continuing working with Gefran. The operational implementation of these principles is guaranteed by the company's procedures which raise awareness of them.

As a condition for initiating a collaboration, during the process for qualifying new suppliers, the latter are required to sign the Sustainability Pact that incorporates their endorsement of the principles of the Global Compact and the Group's Code of Ethics and Conduct. The key goal of such document is to share with the supply chain the sustainability principles pursued by the Group and ensure their application, asking suppliers to commit to managing their business in an ethical and responsible manner, respecting people and the environment and paying attention to several issues:

• / Human rights
• / Occupational health and safety / Environment
• / Fight against corruption
• / Financial solidity

/ Reputation

Specifically, the Sustainability Pact deals with forced or compulsory labour, child labour and trafficking in human beings explicitly, clearly and in a binding manner, with reference to both labour practices and contractual

consequences.

In order to ensure compliance with the main European and international human rights regulations to customers, Gefran has defined specific procurement policies, published on the Group's website (https://www.gefran. com/downloads/product-compliance/).

For details of the policies adopted by Gefran, including with regard to the responsible management of its supply chain, please refer to the paragraph Impact, Risk and Opportunity Management – Policies and actions – MDR-P in the section General disclosures of this Report.

LEGEND
Current	Short term	Value chain-up
Potential	Medium term	Own operations
	Long term	Value chain-down
		Value chain

320 321

Annual Financial Report at 31 december 2025 Gefran Group

S2-4 Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions

Responsible procurement management is based on the selection of suppliers; within the Group, this occurs through a specific qualification process differentiated according to the category of procurement (direct, indirect or services) concerned. To manage this process, Gefran uses an e-procurement portal, which contains a form for the preliminary registration and initial accreditation of suppliers.

In addition to signing the Sustainability Pact, the qualification process requires the supplier to complete the self-evaluation assessment (self-evaluation and qualification sheet), which includes a section dedicated to "Occupational health, safety and ethics", aimed at mitigating possible impacts and risks arising from failure to respect human rights, incidents involving child and/or forced labour, violations of the freedom of association and/or collective bargaining, poor quality of working environments and non-compliance with safety standards.

To verify compliance with the principles adopted, audits are carried out based on a defined checklist and organised according to a multi-annual audit plan involving the Group's main suppliers. In case of any critical issues, plans for improvement and/or corrective actions are suggested.

In order to manage any reported breaches of the law, breaches of the Code of Ethics, and in particular any breaches relating to respect for human rights and workers, Gefran has activated a channel, standardised through the Whistleblowing Procedure published on the Company website (https://www.gefran.com/governance/organizational-protocol-code-of-ethics/). Customers and suppliers, as well as partners, consultants and in general all Stakeholders (of the Parent Company and of Group companies incorporated under Italian law that have adopted the Organisational Model pursuant to Italian Legislative Decree 231/2001) may use the channel to submit reports pursuant to the Procedure, where relating to the actual relationship between the Whistleblower and the Group. For further details on this channel, please refer to the section Governance information – G1-1 Impact, Risk and Opportunity Management of this Report.

Gefran requires the supplier to disclose all relevant information in the event of well-founded suspicions or established violations, and may carry out compliance checks, including by means of documentary requests, audits or on-site checks (if agreed), in order to assess the seriousness and verifiability of the violation. The Sustainability Pact expressly provides that any violation of human rights is considered a material breach of contract and Gefran may terminate contractual relations in the event of clear and verifiable violations. To date, no major human rights issues or incidents related to the value chain have been highlighted.

Metrics and targets

S2-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and

opportunities

Gefran constantly monitors the strength of the supply chain, which has received a growing amount of attention from Stakeholders and institutions in recent years, as a result of increased exposure to disruption risks. Proper due diligence of the supply chain is deemed essential, also for the achievement of the Group's strategic business and sustainability objectives.

Gefran's commitments are embodied in the Strategic Sustainability Plan, formalised in 2022, which is now an integral part of the strategy launched, and which aims to achieve objectives, also in relation to the responsible management of procurement and of the value chain, in line with the political commitments and areas related to the relevant IROs.

The process began by analysing Gefran's positioning and the risks/opportunities of the market. Discussions were held with Stakeholders, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management participated at all levels to define projects, set objectives and determine performance indicators. We then verified the consistency of the targets with the relevant IROs, ensuring the coverage of each important topic. Stakeholders were involved in identifying the relevant impacts, risks and opportunities. It should be noted that the workers in the value chain have not been directly involved for the time being.

The targets concern the gradual extension of endorsement of the Sustainability Pact and of the audit plan. In particular, this concerns suppliers contributing to 80% of purchases, labour-intensive suppliers, waste disposal suppliers and suppliers whose product or service explicitly mentions any point expressed in the Sustainability Pact. Time horizons are generally medium-term though project-specific (intermediate objectives have not been set for the time being).

In general, periodic monitoring of key indicators makes it possible to verify the effectiveness of actions and to highlight progress over time (measurement started in 2023). Progress is highlighted during regular alignment meetings with the functions in charge of strategy execution, and KPIs measuring the effectiveness of the actions implemented against defined targets are collected at least annually. Findings are shared at Sustainability Committee meetings, during which the performance identified against the defined targets is analysed and targets are reviewed if necessary.

Below are the projects envisaged in the Strategic Sustainability Plan, in relation to topics related to workers in the value chain, the targets**26** defined and the progress achieved in 2025.

Projects	Targets	Progress made in 2025
Standardise collection fromConflict Minerals ReportingTemplate (CMRT) suppliers	Annual update of the CMRT file,according to the template.	The annual review of Conflict MineralsReporting was performed via suppliersurveys, and the CMRT template wasupdated (complying with the latestavailable version).
Introduce the Sustainability Pactfor new suppliers and graduallyensure that all suppliers in theregister adhere to it	Maintain at least 80% coverage ofthe annual expenditure for suppliersendorsing the Pact, in relation to thevalue of total annual expenditure.	Of those selected within the Grouppanel, 255 suppliers endorsed thePact in 2025 (224 in 2024 and 192 in2023). Overall, 84.4% of the Group'sprocurement expenditure in 2025was represented by suppliers whohad endorsed the Pact.
Establish a multi-annual auditplan on suppliers of directmaterials globally	By 2027, carry out an audit on 10 suppliers of direct materials per year.	Audit carried out on 22 suppliers (19in 2024 and 17 in 2023). A plan wasdrawn up to monitor the level of ESGintegration in the supply chain, to belaunched from 2026.

26 The targets are set voluntarily on the basis of monitoring metrics and internal considerations, without the support of scientific data.

ESRS S4 CONSUMERS

It should be noted that, as described in the section General disclosures – Criteria for preparation of this Report, at paragraph BP2 Disclosure in relation to specific circumstances*,* some of the phase-in measures provided for in ESRS 1 – Appendix C are adopted when

preparing the sustainability report. Specifically, Gefran provides partial disclosure on social issues, in relation to the requirements of ESRS S4 on Consumers and end users.

Strategy

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

Gefran pays special attention to social aspects, including impacts, risks and opportunities arising from its activities, addressing also the end users of its products. Gefran's direct customers may be subject to significant impacts and risks (mainly distributors and machine manufacturers), just like, in relation to safety aspects, employees of the production plants where the Group's products are used.

In conducting the double materiality assessment, Gefran considered the activity carried out by the Group, the type of materials handled and of products made, as well as the geographical distribution of such activities and the main players in its upstream and downstream chain. Value chain mapping was carried out according to the principle of materiality, taking into account two main drivers: expenditure and products sold by the Group. The objective was to understand the main products purchased, the geographical distribution of the major suppliers and the sectors served, based on information already available. For a description of the main characteristics of the Gefran value chain, please refer to the paragraph SBM-1 Strategy, business model and value chain included in the section General disclosures – Strategy of this Report.

In order to identify the relevant IROs connected with consumers and end users, in addition to the internal functions directly involved, the Group's Top Management and Governance, the main Stakeholders affected were also involved. Consultation sessions were held during 2024 with representatives of the main customers served. During these sessions, information useful to the evaluation of the IROs identified was shared and indications were collected through questionnaires.

As with other topics covered, the analysis of risks related to consumers and end users was initiated through the Enterprise Risk Management process already implemented in the Company, focusing specifically on the risks relating to the topics and sub-topics set out by ESRS S4. For further details on the process conducted, please refer to the paragraph IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities included in the section General disclosures – Impact, Risk and Opportunity Management – Materiality Assessment Process of this Report.

Gefran products are intended for multiple sectors (the main ones being the plastic, metal and mobile machinery supply chains) and are installed within production lines, plants or machinery.

When analysing the possible impacts linked to end users, particular attention was given to product quality and safety requirements in the various applications, including the information provided, which, where not sufficient, might cause malfunctions or defects, exposing operators also to safety risks. Considering also that Gefran does not fully control processes (the end user is generally a tier 2 or tier 3 entity in the downstream chain), the impact identified is considered material.

A significant business opportunity was therefore identified, linked to the enlargement of the portfolio of certifications available for Gefran products, which ensure certain safety standards in particular applications, allowing for expansion into new market segments. This opportunity is pursued through a focus on research and development, as described in the section Research and Development activities of the Report on Operations.

Finally, process innovation and digitalisation were assessed; when they are not timely and effective in responding to or anticipating customers' needs, they can lead to a loss of competitiveness and are considered a material risk. The relevant IROs for consumers and end users are shown in the table below.

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
PERSONAL SAFETYOF CONSUMERSAND/OR END USERS	Failure to comply withproduct quality andsafety regulations, inthe various productapplications, and withconsumer information, as well as possible quality defects,may cause malfunctions or defects,exposing end-usersto safety risks			Expanding the portfolio of availablecertification focusedon user safety, is abusiness opportunityto cover new applications and reach newmarket segments
INFORMATIONRELATED IMPACTSFOR CONSUMERSAND/OR END-USERS			Risk of loss ofopportunities or competitiveness on themarket due to delaysin innovation and digitalisation of processesintended to driveinnovation, anticipating and/or influencingcustomer needs

Impact, risk and opportunity management

S4-1 Policies related to consumers and endusers

In order to achieve high levels of product quality and ensure health and safety for end-users, Gefran has implemented an effective, systematically updated quality management system that complies with the requirements of the ISO 9001:2015 standard, the main element of its Quality Policy, signed by the Chief Executive Officer. Compliance with the standard ensures that products comply with certain requirements and applicable regulations (also on a voluntary basis). The system is also aimed at finding, selecting and working with suppliers that best meet the Company's needs in terms of technological capacity, quality and service. It contributes to the correct interpretation of needs by laying the foundations for better service delivery, full customer satisfaction and the building of lasting relationships.

The processes, involving several company areas, that are applied under the Quality Management System are:

Strategic processes	Operative processes	Support processes
/ Strategy/ Product plan approval/ Three-year plan	/ Commercial/ Innovation/ Operations/ Procurement	/ Management control/ Information Technology systems/ Human resources/ Measurement, analysis andimprovement/ Risk management (ERM)

For each process, specific responsibilities are attributed to ensure product quality and safety:

• / the Operations Departments and the Chief Technology Officer define the product plan and submit it to the Chief Executive Officer for approval, even for integration into the company's three-year plan;
• / Product Managers indicate the requirements of the customer or the market served (with the assistance of the sales staff), integrate input from the innovation area on trends in technological evolution, and monitor the development of binding regulations and certifications which increase security and therefore add a competitive advantage;

/ R&D develops the product and certifies that it complies with all the characteristics and standards in the technical specifications identified by the Product Managers, including any additional certifications;

/ the Product Compliance department, in collaboration with the R&D area, continuously strives to adapt product characteristics to meet the safety requirements of different application sectors and best meet customer needs and fulfil the mandatory requirements in the various markets in which the company operates;

/ Engineering industrialises and develops products through the analysis and identification of production procedures that mitigate possible risks deriving from the incorrect management of production processes;

/ the Operations area takes care of manufacturing: during the process, the necessary control points are in place to ensure compliance with the product characteristics (Gefran performs control tests for 100% of the products and aims to insert automated controls to make them more effective than the manual controls);

/ Quality measures and analyses performance to guide

• continuous improvement.

In case of critical issues, Purchasing and R&D are promptly involved, which implement specific investigations to diagnose problems, minimise risks and implement prevention plans. If necessary, with the support of the Marketing team, actions are performed to recall the product with repair or replacement to protect the market.

Each company level is involved in the development and maintenance of the Quality Management System:

• / the Chief Executive Officer, who is the person ultimately responsible;
• / the Quality Management Manager, who promotes the correct application of the system and ensures that its integrity is maintained;
• / the heads of Functions, who ensure system dissemination and its effective application in the relevant areas;
• / all employees, who are responsible for the quality of their work.

In addition to the quality policy, in order to ensure compliance with the main European and international human rights regulations to customers, Gefran has defined specific procurement policies, published on the Group's website (https://www.gefran.com/ downloads/product-compliance/).

For details of the policies adopted by Gefran, including with regard to the responsible management of its supply chain, please refer to the paragraph Impact, Risk and Opportunity Management – Policies and actions – MDR-P in the section General disclosures of this Report.

S4-4 Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of

those actions

Safety and product quality are key factors and competitive levers of strategic importance.

Gefran products are intended for multiple sectors (the main ones being the plastic, metal and mobile machinery supply chains) and are installed within production lines, plants or machinery. Safety for the operator is a structural element of Gefran's offering, both in terms of product and processes and management system. In particular, Gefran products:

• / provide energy efficiency and accurate control of processes, reducing errors and instability in the systems in which they are integrated;
• / are developed to ensure operational continuity and reduce the likelihood of failures, an essential element for safety in production lines;
• / integrate aspects of digital innovation and secure connectivity, an element that helps to prevent IT/OT risks;

Annual Financial Report at 31 december 2025 Gefran Group

/ are designed in compliance with international quality standards, ensuring the essential requirements for the protection of end users.

Gefran has obtained specific certifications guaranteeing operator safety such as, for example, those based on the Atex specifications or Sil2/Pl'd' industrial safety standards. The development processes of new products, the acceptance of the material, the intermediate production phases and final testing are carried out with particular attention to the management of the regulations to be applied and the evaluation of performance. The commitment to supply cutting-edge safety products is also reflected by the involvement in the work of the Italian Electronic Technical Committee (CEI), which enables the acquisition of knowledge to be applied in product innovation, and the engagement of specialised consultants in product certification.

With specific reference to the pressure sensor range, Gefran provides customers and end users with products with high standards of functional safety (PL-Performance Level and SIL-Safety Integrity Level) and sensors suitable for use in areas exposed to explosion risk (IECEx, ATEX, FM, EAC Ex, Kosha, PESO, Nepsi Ex).

The automation components range also demonstrates the ongoing effort to operate in line with high functioning and safety standards (such as SCCR approval under UL 508) to guarantee that users enjoy a level of protection.

Gefran is constantly investing in innovation: R&D is a fundamental trait of the company and still represents the fundamental value creation lever. This mission naturally prompts the Company to achieve high standards, which require the ability to innovate processes and products. Research and development is therefore focused both on studying products that optimise consumption (of resources and energy) and on innovating products, taking into account European and international safety directives. Since 2017, Gefran has been developing production processes, products and technologies that reduce the potential negative impacts on the environment and people in compliance with the ROHS directive, which introduced restrictions on the use of hazardous materials in electrical and electronic equipment. As a downstream user of chemicals, Gefran operates to ensure that its supply chain fulfils the tasks set out in the European REACH Regulation, ensuring continuity of supply and information to client companies when required.

For further details of research and development projects implemented in 2025, please refer to the paragraphs Results by business area and Research and Development included in the Report on Operations.

The design and industrialization phases, as well as the testing processes envisaged for manufactured products, are supported by specific procedures aimed at preventing defects and, if necessary, ensuring their timely resolution. In order to prevent defects from reaching the field, operators have access to collected data (FPY and FAIL from testing), thanks to the process innovation introduced by the Smart Manufacturing project.

The innovation and digitalisation of processes is progressive, and includes:

• / Smart Manufacturing: with a focus on (i) the digitalisation of factory information flows; (ii) data analysis; (iii) advanced automation, with the implementation of replacement/collaborative robotics for certain product lines;
• / Smart Logistic: with a focus on (i) Digitalisation of shipping processes; (ii) Improvement of the flow of information between the different corporate departments; (iii) Replacement archiving;
• / Implementation of PLM (Product Life Management) to avoid pressure on warehouses due to unstructured management of product information between production sites.

In order to manage any reported breaches of the law, breaches of the Code of Ethics, and in particular any breaches relating to respect for human rights and workers, Gefran has activated a channel, standardised through the Whistleblowing Procedure published on the Company website (https://www.gefran.com/governance/organizational-protocol-code-of-ethics/). Customers and suppliers, as well as partners, consultants and in general all Stakeholders (of the Parent Company and of Group companies incorporated under Italian law that have adopted the Organisational Model pursuant to Italian Legislative Decree 231/2001) may use the channel to submit reports pursuant to the Procedure, where relating to the actual relationship between the Whistleblower and the Group. For further details on this channel, please refer to the section Governance information – G1-1 Impact, Risk and Opportunity Management of this Report. To date, no reports of serious human rights problems or incidents have been received.

Metrics and targets

S4-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

Gefran's commitments are embodied in the Strategic Sustainability Plan, formalised in 2022, which is now an integral part of the strategy launched, and which aims to achieve objectives, also in relation to the responsible management of procurement and of the value chain, in line with the political commitments and areas related to the relevant IROs.

The process began by analysing Gefran's positioning and the risks/opportunities of the market. Discussions were held with Stakeholders, using the usual methods of engagement adopted in the materiality assessment process (among others, workshops, digital events and surveys). Management participated at all levels to define projects, set objectives and determine performance indicators. We then verified the consistency of the targets with the relevant IROs, ensuring the coverage of each important topic. Stakeholders were involved in identifying the relevant impacts, risks and opportunities. It should be noted that such engagement activities did not directly involve the employees of the production plants where the Group's products are used; rather, they concerned Gefran's customers and the distributors or manufacturers of machines subsequently incorporated in those plants.

One of the commitments pursued by the Group with its Strategic Plan is ensuring the cybersecurity of products that increasingly integrate digital functionalities and connectivity. During 2025 an assessment was carried out on the new automation platform G-MATION, aimed at analysing the requirements that will lead, in 2026, to the launch of the IEC 62443-4-2 certification process.

Gefran also aims to implement a customer satisfaction monitoring system. In 2026, preliminary activities will begin to implement the defined target.

Annual Financial Report at 31 december 2025 Gefran Group

A compass guides us in our daily decisions across all areas and business processes; it inspires every event and initiative and dictates our relationship management style with our partners.

This compass is the Gefran Way, which embodies the spirit, identity and values of the Group and its brand.

Promise, Purpose, Values and Manifesto best express the Gefran Way.

Our promise

We have solid roots in industrial automation and technological innovation. We listen and work with passion to find the most effective solutions, creating winning and sustainable relationships. This is our strength.

We work with companies that want to improve technological processes, with people who believe in professional growth and talent, with stakeholders who have an interest in creating value for the community and its surroundings. This is our world.

Purpose

The future is our present.

Be protagonists in technology evolution, recognised as a point of reference for those who build industrial value

and innovation.

Be interpreters of sustainable growth, open to the market, companies and the people we work and live with.

Based on this vision, we wish to give a clear and effective description of how the near future is imagined. Our goals are ambitious, but also concrete and specific.

We introduce the concept of economic, social and environmental sustainability in our Purpose: playing a leading role gives us responsibilities in relation to the world around us, on which we make a recognisable mark.

Promise and Purpose represent a prospective vision and a path aimed at building the foundations of the future, in the present. What is enunciated must include constant dialogue with our partners, which often takes the form of cooperation.

Beyond technology: what our payoff expresses

Beyond Technology embodies the essence of Gefran, conveying the sense of what it does, what it is, and what it brings with it. It means bringing out all that is behind technology and looking beyond the product, beyond meeting companies' needs. It means having a vision of the market of tomorrow.

Values

Our identity is also underpinned by principles that guide attitudes and actions: these are the Group's cultural values, reflecting its convictions, aspirations and commitment to our Stakeholders.

Reliability

We believe in trust in all aspects – be it solid strategies, commitment to products or sustainable relationships with Stakeholders. We have strong expertise to devise effective solutions and offer a service that can anticipate needs.

Dynamism

We believe in the importance of timely responses, in the flexibility of our recommendations and, above all, in proactively searching for the best solution.

Innovation

We anticipate the needs of the future and understand how to implement our vision in the present. We invest in designing premium quality solutions and services and possess the know-how for ongoing innovation and creativity.

Manifesto

The Manifesto describes the experience Gefran wishes to have with its Stakeholders: it is the benchmark for all our partners to deliver value and

trust in their work.

WE EMBRACE TECNOLOGY

OUR VISION IS GLOBAL

WE ARE COMMITTED

Annual Financial Report at 31 december 2025 Gefran Group

ESRS G1 BUSINESS CONDUCT

GOVERNANCE

ESRS 2 GOV-1 Role of administrative, management and supervisory bodies

IMPACT, RISK AND OPPORTUNITY MANAGEMENT

• ESRS 2 IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities
• G1-1 Business conduct policies and corporate culture
• G1-2 Management of relationships with suppliers
• G1-3 Prevention and detection of corruption and bribery

METRICS AND TARGETS

G1-6 Payment practices

ESRS G1 BUSINESS CONDUCT

Governance

ESRS 2 GOV-1 Role of administrative, management and supervisory bodies

The Parent Company Gefran S.p.A. provides direct and indirect coordination functions in the operational activities of business lines and subsidiaries. This responsibility lies with the HQ team, composed of the managers of each company department. Each business line includes dedicated technical and production areas (operations), whose activities are focused on the reference product:

• / Production departments
• / R&D and design
• / Engineering
• / Production services / Inbound logistics

The commercial organisation is dedicated to product distribution, operating through:

• / Sales networks covering geographical regions
• / Internal order processing
• / Finished-product warehouses and outbound Logistics

The Corporate functions of the Parent Company support all business lines and subsidiaries, whether coordinated directly or indirectly. The functions are:

• / Administration, Finance and Control (AFC)
• / Purchasing
• / Legal and Corporate
• / Communication and Image / Information Technology systems
• / People and Organisation (P&O)
• / Quality, Health, Safety and Environment (Q-HSE)

For an overview of the Group's governance and a complete description of its administrative, management and supervisory bodies, their skills and roles (in relation to business conduct), please refer to the section ESRS 2 General disclosures in the paragraphs GOV-1 Role of administrative, management and supervisory bodies and GOV-2 Information provided to the undertaking's administrative, management and supervisory bodies and sustainability issues addressed by them.

For the names of the members of the various management bodies, please refer to the paragraph Corporate bodies of the Report on Operations.

(G1 GOV-1 5)

Impact, risk and opportunity management

ESRS 2 IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities

When conducting the double materiality assessment, aimed at assessing impacts, risks and opportunities, Gefran considered the Group's peculiarities, the activities carried out, the commercial relations established with the various players in the value chain, the relationship with Stakeholders, and the regulatory developments under way.

In order to identify the relevant IROs connected with business conduct, in addition to the internal functions directly involved, the Group's Top Management and Governance, the main Stakeholders affected were also involved. Consultation sessions were held during 2024 with local supply chain representatives. During these sessions, information useful to the evaluation of the IROs identified was shared and indications were collected through questionnaires. As with other topics covered, the analysis of risks related to business conduct was initiated through the Enterprise Risk Management process already implemented in the Company, focusing specifically on the risks relating to the topics and sub-topics set out by ESRS G1. For further details on the process conducted, please refer to the paragraph IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities included in the section General disclosures – Impact, Risk and Opportunity Management – Materiality Assessment Process of this Report.

The Group operates through the Business-to-Business (B2B) model, maintaining limited commercial relations with the Public Administration. The impacts for Stakeholders, typically linked to the possible violation of anti-corruption legislation, are therefore considered not material.

In order to guarantee conditions of fairness and transparency at all times from an ethical and regulatory point of view, the Organisational Model has been adopted, aimed at preventing the offences provided for by Italian Legislative Decree 231/2001, including the Anticorruption guidelines. Its ineffectiveness (e.g. in case of a possible delay in updating it to include new offences) may give rise to a significant risk of non-compliance and perpetration of offences. By using the whistleblowing channels established by the Group, its Stakeholders can report offences and violations without retaliation, as laid down by the specific procedures published on the Company's website (https://www.gefran.com/governance/ organizational-protocol-code-of-ethics/).

In order to act quickly and flexibly, we need a short, preferably local, supply chain that should be engaged in defining suitable procurement plans responding promptly to demand variability. Where possible, Gefran prefers to establish long-term relationships, involving suppliers right from the development and design phases of new products.

Annual Financial Report at 31 december 2025 Gefran Group

In particular, the materiality assessment identified a key opportunity connected to the promotion of a sustainability culture, as an element that may lead to the development of new collaborations or shared initiatives, strengthening economic and/or reputational value. This opportunity is pursued through the process of spreading the culture of sustainability to local supply chains, launched by the Group in 2020.

Also with regard to supply chain management, the risks arising from the absence of adequate supply chains servicing the foreign plants were considered material, also taking into account geopolitical tensions or other unpredictable events, as well as phenomena such as shortages, inflation and cyber risks, which can cause delays or supply difficulties, affecting the company's ability to serve the customer within the required timescales or entailing higher costs. An action plan was thus launched, which

envisages the qualification of alternative suppliers and the strengthening of supply chains near foreign plants.

Lastly, particular attention was paid to information security, with reference to both the general context from which increasing risks are arising and the technological context in which the Group operates, through information devices that use network connections and smart working methods (e.g. Smart Working). In this scenario, the company's IT network is more exposed to cyber risks, which can cause business interruptions, loss of sensitive data, or higher costs to restore the systems. The plan that Gefran has launched aims to mitigate IT risks as much as possible.

The following is a summary of the material IROs connected with business conduct topics.

Sub-topic Negative impact Positive impact Risk Opportunity BUSINESS CULTURE

Delays in fulfilling regulations on sustainability reporting and in implementing strategies may give rise to the risk of regulatory non-compliance, as well as loss of reputational value

Attacks on the Company's computer network, which is more exposed also as a result of new technologies and smart working methods, may give rise to the risk of business disruptions, loss of sensitive data, leading to higher costs for system recovery

BUSINESS CULTURE, CORRUPTION AND BRIBERY

Ineffectiveness of the Organisational Model pursuant to Italian Legislative Decree 231/2001 (e.g. delays in updating new offences), including the Anti-Corruption guidelines, may lead to the risk of non-compliance and the perpetration of offences

LEGEND
Current	Short term	Value chain-up
Potential	Medium term	Own operations
	Long term	Value chain-down
		Value chain

Sub-topic	Negative impact	Positive impact	Risk	Opportunity
PROTECTION OF		The establishment
WHISTLEBLOWERS		of secure, anony
		mous and accessible
		channels allows all
		stakeholders to report
		unlawful conduct
		without fear of retali
		ation or discrimination
		within the Group and
		along the value chain

MANAGEMENT OF RELATIONSHIPS WITH SUPPLIERS INCLUDING PAYMENT PRACTICES

The absence of local supply chains (near plants) in a business context characterised by geopolitical tensions and/or unpredictable events (e.g. export restrictions on critical raw materials by China, tariffs) may result in supply delays, with the consequent risk of production interruptions and difficulty in ensuring continuity for customers

Critical supply chain issues (e.g. shortage, allocation issues, inflation-related tensions or cyber risks) may cause unavailability of materials, resulting in a risk of delays in supply or additional costs

Promoting a culture of economic, social and environmental sustainability within the supply chain represents an opportunity for the development of collaborations and/ or projects that bring economic or reputational benefits

G1-1 Business conduct policies and corporate

culture

The Parent Company of the Gefran Group, Gefran S.p.A., has adhered to the Corporate Governance Code for listed companies issued by the Corporate Governance Committee and publishes annually a report on the implementa-

tion of such code.

The policies adopted by the Group are inspired by Gefran's purpose and aim to guide business leadership towards sustainable growth, capable of creating long-term value for all Stakeholders, integrating environmental, social and governance aspects into the Group's business model and decision-making processes underpinning day-to-day actions.

The main policies are formally approved by the administrative, management and supervisory bodies (the Chief Executive Officer or the Board of Directors of Gefran S.p.A.) and are disclosed on the Company's website to be used by also external Stakeholders. They are distributed to all Group employees through pinboards, digital channels (company intranet and HR platform) and can be the subject of specific training campaigns. They are also illustrated to new hires during the onboarding process.

Gefran's culture is based on the Gefran Way which was built with a bottom-up approach and sums up the values placed by the Group at the heart of its corporate culture. Such culture is developed through training and internal dialogue and through dissemination in initiatives involving external Stakeholders, such as the "Supplier Day" or meetings with business associations or training bodies.

The formalised Code of Ethics and Conduct inspires the Group's conduct and has been chosen as a tool for formalising and disseminating the rigorous ethical and moral principles that are inspired by universal principles and that the Group undertakes to apply and comply with in the course of its activities. (G1-1 7)

/ INTEGRITY

• / FAIRNESS AND PROFESSIONALISM / ENTHUSIASM AND PASSION / CONCRETENESS AND RELIABILITY / FLEXIBILITY
• / SUSTAINABILITY

The Code, among other issues, includes the protection and enhancement of human resources, regulating personnel selection, evaluation and training. It promotes sustainable development while respecting the environment, territory and values. The provisions of the Code influence all business processes: employee management, customer relations and public administration, selection and management of suppliers, financiers and external collaborators.

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Gefran Directors and Employees are required to ensure that the principles of the Code of Ethics and Conduct are adequately respected both within the Group and, in general, by all the Group's interlocutors. Corporate bodies and managers are also required to act as an example of consistency between the principles of the Code and daily behaviour.

The Supervisory Body liaises with the company departments and bodies responsible for the correct implementation and adequate control of the Principles of the Code, and may access all useful corporate information sources for its purpose and view internal documents, data and protocols, operating independently with respect to senior management, from which it receives full support. Senior management refers to the Chairwoman and the Chief Executive Officer and, where necessary, the Board of Directors and the Board of Statutory Auditors.

Any measures and/or sanctions (of any kind) relating to violations of the Code will be adopted by the competent bodies on the basis of applicable legislation, the internal disciplinary system and the provisions of national collective agreements (where recognised by law).

The Gefran S.p.A. Board of Directors resolved to adopt an Organisational, Management and Control Model ("Organisational Model 231") aimed at preventing commission of the crimes identified in Italian Legislative Decree no. 231/2001. The Organisational Model, drawn up on the basis of the Confindustria Guidelines and introduced also in the Group's other Italian companies, is accompanied by the Procedures Manual and is regularly updated in line with regulatory changes. At least annually, Gefran carries out the updating of the risk assessment 231 activity, with the aim of evaluating any changes in the Company's risk profile and of incorporating any organisational changes or the introduction of new "predicate offences" or changes thereto. This activity is carried out both through interviews with the functions involved and through document analysis. The Organisational, Management and Control Model applies to the Parent Company Gefran S.p.A. and the other Italian companies and its scope of application is extended, through the relative Procedures Manual, to the activities carried out within the same companies.

The Code of Ethics and Conduct is to be understood as an integral part of the Organisational Model, and is interpreted

together with the Group's Anti-Corruption Guidelines and other codes of conduct and/or policies applicable to the various stakeholders, as the case may be.

The main risk profiles linked to the Group's activities, with regard to corruption, are identified and mapped in risk assessments. Considering the limited relations that Gefran has with the Public Administration and the assessments carried out, it should be noted that there are no company departments particularly exposed to these risks. They are therefore considered low-profile (the issue of corruption is not considered a material risk for the Group).

The relevant policies are consistent with the United Nations Convention. The Anti-Corruption Guidelines are based on the main anti-corruption laws and regulations currently in force (the UK Bribery Act, US FCPA), as well as on the guidelines and regulations issued by non-governmental organisations such as the International Chamber of Commerce (ICC), the World Economic Forum Partnering Against Corruption (PACI), and the 2005 United Nations Convention against Corruption (UNCAC).

Suppliers are also required to sign the Sustainability Pact, which contains concrete commitments on sustainability issues. They are also involved in the implementation of the strategic sustainability plan through programmes reserved therefor that culminate in the annual "Supplier Day".

The policy for the Management of dialogue with Shareholders and Investors, approved by Gefran on 10 March 2022 in application of the Corporate Governance Code approved by the Italian Corporate Governance Committee, reflects a principle that has always characterised Gefran: to develop a correct comparison with Stakeholders to create value in the medium to long term. The objective pursued by the Policy is to ensure that the dialogue takes place in compliance with legislation and corporate regulations in force from time to time, including that concerning the processing of relevant and insider information, and in any case that it is based on the principles of fairness, transparency and information symmetry. It is in the Company's interest to provide Stakeholders with clear, complete, correct, truthful and not misleading information. The policy for the Management of dialogue with Shareholders and Investors is intended for the current and potential shareholders of Gefran, regardless of their nature, as well as for financial and banking analysts and corporate brokers.

In order to mitigate the risk of delays in the fulfilment of its sustainability reporting and strategy, Gefran has adopted a Group Procedure, disseminated to all its entities, aimed at developing the reporting system to meet the current disclosure requests laid down by European Directive 2022/2464/EU and Italian Decree 125/2024. Specifically, the Group Sustainability Reporting Procedure describes the contents of the Group Sustainability Declaration, in accordance with the Corporate Sustainability Reporting Directive, as well as its drafting process, describing the roles and responsibilities of the parties involved.

All policies adopted are illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P included in the section General disclosures of this Report.

(G1-1 MDR-P 65 a, b, c, d, e, f) (G1-1 AR 1 a, b, c, d)

Data management and cybersecurity

Gefran has introduced a Regulation for the correct use of information technology, aimed at preventing improper uses that might jeopardise the Group's security and image. This regulation regulates the conditions for the use of IT tools by employees and offers practical advice to contribute to the security of the corporate network and data, in a context of increasing cybersecurity challenges which might expose Gefran to security risks as well as to risks to its image. Gefran's intention was to adopt a policy that was transparent and also in line with the instructions of the Italian Data Protection Authority.

In addition, the Social Media Policy defines the Group's conduct in the management of social media channels, which have assumed a central role in corporate communication and require special attention also on account of how they typically operate (high level of interactivity and instantaneous global deployment).

Whistleblowing

Anyone who becomes aware of possible breaches of the rules and principles established by the Code of Ethics and Conduct is required to report them to the Supervisory Body in the manner provided for by the Organisational, Management and Control Model pursuant to Italian Legislative Decree 231/2001 (known as Model 231). In order to facilitate reports to the SB by subjects who become aware of violations of the Model, even potential ones, dedicated communication channels have been provided.

In particular, an internal reporting channel is active, with which it is possible to report breaches of the law, internal control principles, company procedures and standards, as required by the Gefran Group's Whistleblowing Procedure, the last revision of which was approved by the Board of Directors on 3 August 2023.

Annual Financial Report at 31 december 2025 Gefran Group

The Whistleblowing Procedure describes the entire process designed to investigate any incidents involving the Company's conduct in a swift, independent and objective manner, including cases of corruption and bribery.

Gefran, in encouraging Whistleblowers to report possible unlawful conduct or irregularities in a timely manner, ensures the confidentiality of the Report and the data contained therein.

The procedure, adopted in accordance with the provisions of the law, the Code of Ethics and Conduct and the SA 8000:2014 standard on Social Accountability, protects the confidentiality of the whistleblower, forbids retaliation, and provides specific instructions for the management of reports.

Reports can be sent through a dedicated portal at: https://gefran.whistletech.online or by dialling 0692917843, according to the applicable methods and relevant procedure. Specifically, the portal dedicated to whistleblowing includes two separate channels: one dedicated to whistleblowing for the Parent Company Gefran Spa and one shared by all the other Group companies. The Whistleblowing Channel, pursuant to the procedure adopted by the Parent Company and the Italian companies, is also open to Stakeholders external to the organisation.

The Procedure described above is available to members of the workforce through the usual distribution channels used by Gefran: the corporate website and the corporate intranet, presentation during the onboarding of new employees, as well as extensive dedicated training campaigns, the last of which took place in 2023, at the time of the most recent update, and involved all employees working for Gefran S.p.A. and the Italian subsidiaries that have adopted Model 231.

The measures taken to protect reporting workers against retaliation in accordance with the applicable legislation transposing Directive (EU) 2019/1937 of the European Parliament and of the Council are compliant. The Company has adopted a specific procedure with defined terms and guarantees of independence and objectivity.

Specifically, the procedure describes the duties of the persons responsible for receiving and reviewing reports (Channel Management Officers), namely:

/ for the Parent Company Gefran S.p.A.: the General Counsel;

/ for all other Group companies: the Chief People & Organization Officer

Each Channel Management Officer may use the support of the Q-HSE Director and carries out the following activities:

A.on request, provides information on the use of the reporting channels, as well as on the Whistleblower's protection measures;

B.informs the Whistleblower of the receipt of the latter's internal report within seven days from its receipt, unless the whistleblower explicitly requests

otherwise;

C.liaises with the Whistleblower and may request additional information if

necessary;

D.duly follows up on the Reports received;

E. carries out the investigation necessary to follow up on the Report, including by means of hearings and obtaining documents;

F. responds to the Whistleblower within three months or, in case of justified and reasoned causes, or, in the absence of such notice, within seven days from receipt of the report;

G.notifies the Whistleblower of the final outcome, which may also consist of filing or forwarding the report to the competent authorities.

According to the Procedure, the Channel Officer must periodically report on the types of reports received and the outcome of the investigation to the Supervisory Body and the Control and Risks Committee of Gefran S.p.A.

In the course of internal and/or third-party audits on compliance with the SA 8000:2014 Social Accountability Management standard, controls are also carried out (through interviews with a sample of workers) on the dissemination and knowledge of Company Policies and Procedures, including the Whistleblowing Procedure described above. Depending on the results of such controls, if necessary, Gefran takes action to strengthen knowledge of the Systems, through awareness-raising activities (dissemination of information on Company digital platforms) and/or the organisation of additional focused training. (G1-1 10, a, c i, c ii) (G1-1 AR 1 c, d)

Annual Financial Report at 31 december 2025 Gefran Group

G1-2 Management of relationships with suppliers

Sharing a sustainability culture

Sharing values and ethical principles with the components of the supply chain is a requirement that Gefran considers primary to achieve sustainability objectives. It means ensuring that suppliers are committed to respecting human rights, protecting workers' health and safety, protecting the environment and ensuring traceability of raw materials.

In 2020, Gefran launched the project Promoting a sustainability culture. This targets local suppliers, which are generally small and mid-sized companies with limited access to sustainability solutions and not always equipped with resources to develop actions in this area, even when sensitive to the issues. Several actions were taken following such launch.

Training:

• / Training of the Gefran team in contact with suppliers every day
• / ESG training sessions offered to suppliers from the panel
• / Processes:
• / Review of the accreditation process
• / Introduction of the "Sustainability Pact" / Audit Plan

Events:

/ Meetings focused on specific themes, consistent with Gefran's strategy / Sharing of ESG objectives and experience gained from completed projects

Engagement:

/ "Call to Action" to contribute to Gefran's ESG objectives / "Ideas Box", a network for sharing experiences and implemented projects

In the following years, the process was progressively consolidated: in 2022, the focus was on reducing emissions, the central objective of the company's decarbonisation strategy (the plan for calculating other indirect Scope 3 emissions was shared and suppliers were requested to commit to contributing to Gefran's project through the ZeroImPact pact); in 2023, concrete projects were launched within a panel divided by impact categories: adoption of green energy, energy efficiency, deployment of low-carbon packaging, improvement in transport usage, and other areas of sustainability.

At the heart of the engagement journey is Supplier Day, an event that represents a time for discussion, during which goals and projects aimed at achieving them are shared.

Today, the suppliers involved by Gefran in this process accurately track their Scope 1 and 2 emissions, some of them even their Scope 3 emissions, allowing Gefran to measure its total carbon footprint more accurately. Suppliers are involved in achieving the reduction target through projects aimed at improving the efficiency of their plants and processes. This engagement is at the heart of the creation of the Ideas Box, the network for sharing experiences among panel members: a digital repository of projects carried out each year by suppliers, grouped into different areas: plant efficiency, renewable energy, transport, packaging or other specific projects

Policies and processes for responsible supply chain management

Gefran purchases raw materials, products and services from suppliers in culturally and economically different countries. For this reason, a policy has been defined setting out the general standards for the assessment of suppliers and the principles that characterise the Group's approach to sustainable supply chain management. Monitoring procurement processes is essential to ensure the highest standards of quality and product security, while respecting the environment and human rights.

Responsible procurement is based on the selection of suppliers through a qualification process differentiated according to the category of procurement (direct, indirect or services). To manage this process, Gefran uses an e-procurement portal, which contains a form for the preliminary registration and initial accreditation of suppliers.

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Annual Financial Report at 31 december 2025 Gefran Group

In the case of suppliers of materials employed directly in the production process, information on the productive and economic structure is collected through self-evaluation questionnaires and information from third parties. To mitigate the risks of non-respect for human rights, work accidents by minors, forced labour and breaches of freedom of association and collective bargaining, the supplier's self-evaluation and qualification sheet has been integrated with the section "Occupational health, safety and ethics".

In addition, the signing of the Sustainability Pact, which integrates adherence to the principles of the Global Compact and the Group Code of Ethics and Conduct with aspects relating to the management of environmental, reputational and financial risks, is required as a prerequisite for activating a partnership. The key goal is to collaborate with suppliers who share and implement the same principles of sustainability and run their business in an ethical, responsible way, demonstrating respect for people (including human rights) and the environment.

For suppliers of indirect materials and services, the qualification procedure is simplified, with the exception of undertakings for the disposal of waste and suppliers of contracted services, which are required to produce the documentation stipulated by the regulations in force for qualification purposes. Since 2020, a dedicated procedure has been developed for service providers (Procedure for the management of tenders or works contracts). In compliance with the regulations in force, all service providers who require the physical presence of personnel on company premises for the provision of the service are obliged to complete a procedural accreditation process involving the signature and delivery of documents attesting to their professional and documentary qualifications in terms of safety and job protection.

All policies, procedures and regulations adopted for the harmonised management of procurement processes and supplier relations are illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P included in the section General disclosures of this Report.

To verify actual application of the principles endorsed during accreditation, audits are carried out based on a defined checklist and organised according to a multi-annual audit plan involving the Group's main suppliers. In case of any critical issues, plans for improvement and/or corrective actions are suggested. The Quality function always performs an audit to certify the suitability of suppliers of materials deemed strategic.

In order to ensure consistency and harmonisation of operational practices, supplier qualification and assessment procedures have been extended to the entire Group. Adequate training has been provided to all teams involved in the relevant processes. Internal audits are carried out on a regular basis with the aim of verifying and ensuring the correct application of the procedures.

Once a year, the performance of suppliers representing 80% at the value of raw material purchases is assessed in order to highlight any critical issues and launch the consequent recovery and improvement plans. The assessment includes several areas:

• / Quality, with a focus on non-conformities and responsiveness in implementing mitigation;
• / Logistics, assessing punctuality and flexibility;
• / Purchasing, paying attention to competitiveness and proactivity and also checking financial solidity and contractual conditions;

During 2025, also by virtue of the process of engagement in strategic objectives, Gefran launched a project aimed at expanding the supplier evaluation sheet to include a specific section on sustainability. As from 2026, the evaluation will therefore include:

• / The availability of accurate data on annual CO2e emissions (at least Scope 1 and 2);
• / The implementation of actual projects aimed at decarbonisation (at least 1 project/year);
• / The level of integration of ESG practices into company processes and strategy, expressed by an independent measurement represented by a score calculated by a recognised platform.

Several aspects were considered when choosing the platform, including the way suppliers are involved through an "inclusive and participatory" approach, the level of support provided in carrying out the required activities (typically, completing questionnaires and verifying data), and not least the added value suppliers can gain in further strengthening their sustainability

strategy and their relationship with Gefran.

In addition to integrating the general evaluation of the supply relationship, the implementation of the platform launched in the first quarter of 2026 will enable Gefran to strengthen supplier engagement, collect precise information on the strategies implemented and enrich the mapping of its value chain.

In order to ensure compliance with the main European and international human rights regulations, Gefran has defined specific procurement policies, published on the Group's website (https://www.gefran.com/downloads/ product-compliance/).

With regard to minerals from conflict zones (known as conflict minerals), Gefran is committed to responsible procurement and considers mining activities that feed conflicts as unacceptable. Gefran's commitment is in line with the activity carried out by the Electronic Industry Citizenship Coalition® (EICC®) and the Global e-Sustainability Initiative (GeSI) to improve the transparency and traceability of metals in the supply chain.

For this purpose, the BOM of the products manufactured by the Group is periodically mapped to identify the presence of the four minerals covered by the regulations (tungsten, tantalum, gold and tin). After this first check, suppliers who might potentially use such minerals in their production process are identified and are required to certify that their procurement does not occur in conflict zones, collecting information according to standards made available by Responsible Minerals Initiatives (RMI). Regular document compliance campaigns are carried out in which suppliers are asked to certify compliance with international regulations and rules including, for example, Reach, Rohs and Conflict Minerals.

The procedures adopted by Gefran are also aimed at avoiding late payment with respect to purchase conditions. In particular, the structure of the Administrative-Accounting Model pursuant to Italian Legislative Decree 262/2005 by Gefran S.p.A. provides for flows and processes covering the entire payables procedure, from the generation of the purchase request to payment.

Gefran requires the supplier to disclose all relevant information in the event of well-founded suspicions or established violations, and may carry out compliance checks, including by means of documentary requests, audits or on-site checks (if agreed), in order to assess the seriousness and verifiability of the violation. The Sustainability Pact expressly provides that any violation of human rights is considered a material breach of contract and Gefran may terminate contractual relations in the event of clear and verifiable violations. (G1-2 15 a, b) (G1-2 AR 2 a, b, c, d)

G1-3 Prevention and detection of corruption and bribery

Gefran is committed to combating any form of corruption through the enforcement of Italian and international law and the voluntary adoption of ethical principles in carrying out its business.

To prevent corrupt activities, the Group has adopted, in the context of the Organisational Model 231, the Group's Code of Ethics and Conduct and a Procedures Manual which contain the principles of conduct that the Company's employees, contract staff, customers and suppliers are required to comply with. These instruments are in addition to the procedures required by compliance with Administrative and Accounting Control Model 262.

The Group has also adopted Anti-Corruption Guidelines, shared with all subsidiaries, to outline typical situations in which an attempt at corruption may occur and how to manage them. A training programme has been put in place for all General Managers on this topic, and compliance thereby is typically verified through Internal Audits, carried out according to audit plans in the Group's Italian and foreign offices. The results of the audits are shared with the management and supervisory bodies of the Parent Company.

The Group has implemented various channels of communication to the Supervisory Body, through which any breaches of the principles and procedures may be reported (Whistleblowing Procedure).

Policies and procedures are formally approved by the administrative, management and supervisory bodies (the Chief Executive Officer or the Board of Directors of Gefran S.p.A.) and are disclosed on the Company's website to be used by also external Stakeholders. They are distributed to all Group employees through pinboards, digital channels (company intranet and HR platform) and can be the subject of specific training campaigns. They are also illustrated to new hires during the onboarding process.

They are illustrated in the paragraph Impact, Risk and Opportunity Management – Policies and actions - MDR-P in the section General disclosures of this Report.

To date, no reports have ever been received relating to corruption and bribery.

Considering the low risk of corruption and bribery, given the type of activity carried out by the Group which involves sporadic relations with the Public Administration, as confirmed also by the fact that no corruption and bribery cases have ever occurred, training takes place in the context of the broader training relating to the principles of the Code of Ethics and Conduct and to compliance with the model and procedures adopted pursuant to Italian Legislative Decree 231/2001. Members of the administrative, management and supervisory bodies oversee the training programme and receive ongoing updates on regulatory changes.

There are no processes or procedures other than those described above. (G1-3 18 a, b, c, 20, 21 a, b, c)

Metrics and targets

G1-6 Payment practices

The standard payment terms applied by the Group vary according to the category of suppliers. For suppliers of direct materials and services, the payment term ranges from advance payment up to 120 days. As regards service suppliers, payment terms are reduced to 45-60 days.

Below are the Group's indicators regarding the payment practices adopted. The data presented are the result of an accurate collection of information managed through the various accounting systems implemented across all Group companies and coordinated by the central AFC function.

Average number of days for payment of an invoice

Average number of days for payment of aninvoice	Unit ofmeasurement	2024	2025
Average number of days for payment of an invoice fromthe date on which the contractual or legal paymentterm runs	days	109	89
Number of legal proceedings currently pending due tolate payment;	number ofproceedings	-	-

Payments in line with standard payment terms	Unit ofmeasurement	2024	2025
	number of		25,752
Number of invoices	invoices	34,341
	number of
Number of payments meeting standard payment terms	payments	27,016	18,202
Percentage of payments meeting standard paymentterms	%	79%	71%

352 353

Annual Financial Report at 31 december 2025 Gefran Group

With regard to 2025, the detailed analysis was conducted only for the Group's Italian companies, in accordance with ESRS requirements. To obtain the average number of days for payment, the sum of payment times weighted by the amount was divided by the sum of all amounts. To obtain the number of payments meeting standard payment terms, only invoices whose difference between the date of payment and the due date was less than or equal to 0 were counted.

Conversely, with regard to 2024, the same method could not be applied to calculate the indicators relating to that year given that the basic data reported in the previous year were not homogeneous. The 2024 payment days indicator is calculated by comparing the amount of payables to suppliers and the annual cost of the goods and services purchased (consolidated values), including rental fees which are no longer charged to the income statement in application of IFRS16. The ratio obtained is multiplied by 365, so as to convert the result into days. (G1-6 33 a, b, c)

CERTIFICATION OF THE SUSTAINABILITY REPORT PURSUANT TO ARTICLE 81- TER, PARAGRAPH 1, OF CONSOB REGULATION NO. 11971 OF 14 MAY 1999 AS AMENDED

The undersigned Marcello Perini, in his capacity as Chief Executive Officer, and Paolo Beccaria, in his capacity as Executive in charge of financial reporting of Gefran S.p.A., hereby certify, pursuant to Article 154-bis, paragraph 5-ter, of Italian Legislative Decree No. 58 of 24 February 1998, that the Sustainability Report included in the Report on

Operations is:

/ in accordance with the reporting standards applied pursuant to Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 and Italian Legislative Decree 6 September 2024, no. 125;

/ in accordance with the specifications adopted pursuant to Article 8(4) of Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020.

Provaglio d'Iseo, 12 March 2026

Chief Executive Officer

Marcello Perini

Executive in charge of financial reporting

Paolo Beccaria

CONSOLIDATED FINANCIAL STATEMENTS

Annual Financial Report at 31 december 2025 Gefran Group

Statement of profit/(loss) and other items of comprehensive income

(Euro /000)	progressive as at 31 December
	Notes	2025	2024
NET PROFIT (LOSS) FOR THE PERIOD		9,869	11,142
Items that will not subsequently be reclassified in the
statement of profit/(loss) for the period
- revaluation of employee benefits: IAS 19	26	98	9
- overall tax effect	26	(23)	(2)
- equity investments in other companies	18	(32)	(115)
Items that will or could subsequently be reclassified inthe statement of profit/(loss) for the period
- conversion of foreign companies' financial statements	24	(2,318)	684
- fair value of cash flow hedging derivatives	24	79	(351)
Total changes, net of tax effect		(2,196)	225
Comprehensive result for the period		7,673	11,367
Attributable to:
Group	-	7,673	11,367
Third parties	-	-	-

Statement of profit/(loss) for the period

	progressive as at 31 December
(Euro /000)	Notes	2025	2024
Revenues from product sales	29	137,711	131,530
of which related parties:	40	154	-
Other revenues and income	30	1,253	1,077
Increases for internal work	14,15	2,225	2,148
TOTAL REVENUES		141,189	134,755
Change in inventories	20	(883)	(1,954)
Costs of raw materials and accessories	31	(40,832)	(37,371)
of which related parties:	40	(751)	(507)
Service costs	32	(23,031)	(22,020)
of which related parties:	40	(290)	(252)
Miscellaneous management costs	33	(795)	(1,012)
Other operating income	33	111	114
Personnel costs	34	(53,160)	(49,473)
of which related parties:	40	(104)	-
Impairment/reversal of trade and other receivables	20	(156)	17
Amortisation and impairment of intangible assets	35	(1,856)	(1,770)
Depreciation and impairment of tangible assets	35	(4,865)	(4,885)
Depreciation rights of use	35	(1,389)	(1,276)
EBIT		14,333	15,125
Gains from financial assets	36	1,334	1,833
Losses from financial liabilities	36	(2,059)	(1,644)
(Losses) gains from shareholdings valued at equity	37	12	39
PROFIT (LOSS) BEFORE TAX		13,620	15,353
Current taxes	38	(3,463)	(3,551)
Deferred tax assets and liabilities	38	(288)	(660)
TOTAL TAXES		(3,751)	(4,211)
NET PROFIT (LOSS) FOR THE PERIOD		9,869	11,142
Attributable to:
Group	-	9,869	11,142
Third parties	-	-	-

Earnings per share	progressive as at 31 December
(Euro)	Notes	2025	2024
Basic earnings per ordinary share	25	0.69	0.78
Diluted earnings per ordinary share	25	0.69	0.78

Annual Financial Report at 31 december 2025 Gefran Group

Statement of financial position

(Euro /000)	Notes	31 December2025	31 December2024
NON-CURRENT ASSETS
Goodwill	13	5,918	6,081
Intangible assets	14	8,142	7,249
Property, plant, machinery and tools	15	38,466	37,598
of which related parties:	40	345	198
Usage rights	16	3,495	3,770
Shareholdings valued at equity	17	4,776	764
Equity investments in other companies	18	1,785	1,810
Receivables and other non-current assets	19	88	88
Deferred tax assets	38	2,202	2,396
Non-current financial assets for derivatives	23	5	34
Other non-current financial investments	23	102	104
TOTAL NON-CURRENT ASSETS		64,979	59,894
CURRENT ASSETS
Inventories	20	15,182	15,747
Trade receivables	20	26,016	23,264
of which related parties:	40	135	-
Other receivables and assets	21	3,526	3,831
Current tax receivables	22	697	328
Cash and cash equivalents	23	53,140	59,629
TOTAL CURRENT ASSETS		98,561	102,799
TOTAL ASSETS		163,540	162,693

(Euro /000)	Notes	31 December2025	31 December2024
SHAREHOLDERS' EQUITY
Share capital	24	14,400	14,400
Reserves	24	76,560	73,796
Profit / (Loss) for the year	24	9,869	11,142
Group Shareholders' equity	24	100,829	99,338
Shareholders' equity of minority interests	24	-	-
TOTAL SHAREHOLDERS' EQUITY		100,829	99,338
NON-CURRENT LIABILITIES
Non-current financial payables	23	11,697	16,269
Non-current financial payables for IFRS 16 leases	23	2,379	2,664
Non-current financial liabilities for derivatives	23	178	311
Employee benefits	26	2,208	2,131
Non-current provisions	27	463	463
Deferred tax provisions	38	985	933
TOTAL NON-CURRENT LIABILITIES		17,910	22,771
CURRENT LIABILITIES
Current financial payables	23	4,921	5,173
Current financial payables for IFRS 16 leases	23	1,230	1,195
Trade payables	20	21,571	18,795
of which related parties:	40	558	314
Current provisions	27	693	802
Current tax payables	22	1,025	1,146
Other payables and liabilities	28	15,361	13,473
TOTAL CURRENT LIABILITIES		44,801	40,584
TOTAL LIABILITIES		62,711	63,355
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES		163,540	162,693

Annual Financial Report at 31 december 2025 Gefran Group

(Euro /000)	Notes	31 December2025	31 December2024
E) CASH FLOW GENERATED BY (USED IN) FINANCINGACTIVITIES
New financial payables	23	297	-
Repayment of financial payables	23	(5,117)	(9,548)
Increase (decrease) in current financial payables	23	3	-
Outgoing cash flow due to IFRS 16	23	(1,463)	(1,305)
Taxes paid	38	(2,330)	(1,286)
Interest paid	36	(719)	(1,186)
Interest received	36	840	1,388
Dividends paid	24	(6,107)	(5,965)
TOTAL		(14,596)	(17,902)
F) CASH FLOW FROM CONTINUING OPERATIONS(D+E)		(5,445)	2,427
G) Exchange rate translation differences on cash at hand	23	(1,044)	43
H) NET CHANGE IN CASH AT HAND (F+G)		(6,489)	2,470
I) CASH AND CASH EQUIVALENTS AT THE END OF THE		53,140	59,629

Consolidated cash flow statement

(Euro /000)	Notes	31 December2025	31 December2024
(A) CASH AND CASH EQUIVALENTS AT THE START OFTHE PERIOD		59,629	57,159
B) CASH FLOW GENERATED BY (USED IN)OPERATIONS IN THE PERIOD
Net profit (loss) for the period		9,869	11,142
Depreciation, amortisation and impairment	35	8,110	7,931
Provisions (Releases)	20,26,27	1,956	2,042
Capital (gains) losses on the sale of non-currentassets	14,15	-	(34)
Net result from financial operations	36	713	(228)
Taxes	38	3,751	4,211
Change in provisions for risks and future liabilities	27	(496)	(471)
Change in other assets and liabilities	21,28	(452)	1,741
Change in deferred taxes	38	8	2
Change in trade receivables	20	(1,949)	489
of which related parties:	40	(135)	35
Change in inventories	20	(694)	458
Change in trade payables	20	2,451	(626)
of which related parties:	40	244	(14)
TOTAL		23,267	26,657
C) CASH FLOW GENERATED BY (USED IN)INVESTMENT ACTIVITIES
Investments in:
- Property, plant & equipment and intangible assets	14,15	(9,388)	(6,363)
of which related parties:	40	(345)	(198)
- Equity investments and securities	17,18	(4,007)	-
- Acquisitions net of acquired cash	10	(739)	-
- Financial receivables	19	-	-

Disposal of non-current assets 14,15 18 35 TOTAL (14,116) (6,328)

D) FREE CASH FLOW (B+C) 9,151 20,329

Annual Financial Report at 31 december 2025 Gefran Group

Statement of changes in shareholders' equity

Overall EC reserves

(Euro /000)		Notes Share capital	Capitalreserves	Consolidationreserve		Other reserves Retained profit/(loss)	Fair valuemeasurementreserve	Currencytranslationreserve	Other reserves	Profit/(loss)for the year	Group Totalshareholders'equity	Shareholders'equity ofminorityinterests	Totalshareholders'equity
Balance at		14,400	21,926	9,390	8,500	24,589	298	3,573	(388)	11,653	93,941	-	93,941
1 January 2024
Destination ofprofit 2023
- Other reserves
and provisions	24	-	-	721	-	10,932	-	-	-	(11,653)	-	-	-
- Dividends	24	-	-	-	-	(5,965)	-	-	-	-	(5,965)	-	(5,965)
Income/ (Expenses)
recognised at	24	-	-	-	1	-	(466)	-	6	-	(459)	-	(459)
equity
Change in
translation reserve	24	-	-	-	-	-	-	684	-	-	684	-	684
Other changes	24	-	-	(5)	-	-	-	-	-	-	(5)	-	(5)
Profit 31 December2024	24	-	-	-	-	-	-	-	-	11,142	11,142	-	11,142
Balance at
31 December		14,400	21,926	10,106	8,501	29,556	(168)	4,257	(382)	11,142	99,338	-	99,338
2024
Balance at		14,400	21,926	10,106	8,501	29,556	(168)	4,257	(382)	11,142	99,338	-	99,338
1 January 2025
Destination ofprofit 2024
- Other reserves
and provisions	24	-	-	920	8,178	2,044	-	-	-	(11,142)	-	-	-
- Dividends	24	-	-	-	-	(6,107)	-	-	-	-	(6,107)	-	(6,107)
Income/
(Expenses)
recognised at	24	-	-	-	27	-	47	-	74	-	148	-	148
equity
Change in
translation reserve	24	-	-	-	-	-	-	(2,318)	-	-	(2,318)	-	(2,318)
Other changes	24	-	-	-	(101)	-	-	-	-	-	(101)	-	(101)
Profit 31 December
2025	24	-	-	-	-	-	-	-	-	9,869	9,869	-	9,869
Balance at
31 December		14,400	21,926	11,026	16,605	25,493	(121)	1,939	(308)	9,869	100,829	-	100,829
2025

SPECIFIC EXPLANATORY NOTES TO THE ACCOUNTS

Annual Financial Report at 31 december 2025 Gefran Group

1. General information, form and content

Gefran S.p.A. is incorporated and located in Italy, at Via Sebina 74, Provaglio d'Iseo (BS).

The Group's main activities are described in the Report on Operations, in the paragraph Gefran Group Activities.

On 12 March 2026, the consolidated financial statements of the Gefran Group for the year ending 31 December 2025 were approved by the Board of Directors, which authorised their publication. The tagging of the financial statements, as well as the explanatory notes, has been prepared in compliance with the provisions of ESMA and the ESEF taxonomy.

2. Form and content

The consolidated financial statements of the Gefran Group were prepared in accordance with the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB) as approved by the European Union.

They comprise the financial statements of Gefran S.p.A., its subsidiaries and its direct and indirect associates, approved by their respective Boards of Directors. The consolidated companies have adopted international accounting standards, with the exception of a number of companies whose financial statements have been restated in accordance with IAS/IFRS for the purposes of the Group's consolidated financial statements.

The legal audit of the consolidated financial statements was carried out by Deloitte & Touche S.p.A.

These consolidated financial statements are presented in Euro, the functional currency of most Group companies. Unless otherwise stated, all amounts are expressed in thousands of Euro.

For details on the seasonal nature of the Group's operations, reference should be made to the attached "Consolidated income statement by quarter".

3. Accounting schedules

The Gefran Group has adopted:

/ a statement of financial position, according to which assets and liabilities are separated into current and non-current categories;

/ a statement of profit/(loss) for the year, in which costs are categorised by

nature;

/ a statement of profit/(loss) for the year and other items of comprehensive income, which shows income and charges posted directly to shareholders'

• equity, net of tax effects;

/ the cash flow statement prepared using the indirect method, which adjusts the net profit for the period to eliminate taxes and the effects of non-monetary transactions, any deferral or allocation from previous or future operating collections or payments, and revenues or costs associated with the cash flows deriving from investment or financing activities; with a view to greater transparency, the Company has chosen to present the cash flow statement in a format that best represents its dynamics, starting with net profit for the period and then eliminating the taxes charged to the income statement, rather than starting with the pre-tax profit.

With reference to Consob resolution 15519 of 27 July 2006, amounts referring to transactions with related parties and non-recurring items, if any, are classified separately from the relevant items in the statement of financial position and income statement.

4. Consolidation principles and measurement criteria

Subsidiaries are consolidated on a line-by-line basis when the Group has control over them. There is control if all the following three conditions are met:

/ the Groups has authority over an investee (whether or not this authority is

/ it has exposure or a right to variable returns from the investee company;

• exercised in practice);
• latter's returns.

/ it is able to use its authority over the investee company to influence the

The results of subsidiaries acquired or sold over the year are included in the consolidated income statement as from the actual acquisition date or until they are sold.

Companies controlled jointly with other partners and associates, or subject to significant influence, are consolidated at equity.

The main principles adopted are the same for all companies in the scope of consolidation, and the related income statements and statements of financial position were all drawn up as of 31 December 2025; in addition, all financial

statements have been approved by the respective Boards of Directors.

The main criteria adopted in line-by-line consolidation are listed below.

Gains from transactions between subsidiaries not yet realised, as well as receivables, payables, costs and revenues between consolidated companies, are eliminated.

The dividends paid by consolidated companies are eliminated from the income statement and added to earnings from previous years, if and to the extent that they are taken from them.

The portions of shareholders' equity of minority interests and profits (losses) pertaining to minority interests are shown respectively in a specific item under shareholders' equity, separately from Group shareholders' equity, and in a specific item in the income statement.

If there are any assets held for sale and discontinued, the sale of which is highly likely in the next 12 months, they are classified in accordance with IFRS 5, provided that the other conditions set out therein are met; therefore, once consolidated on a line-by-line basis, the related assets are classified in a single item, "Assets held for sale and discontinued", the related liabilities are recorded under liabilities in a single line of the statement of financial position, and the related margin is shown under "Net profit (loss) from assets held for sale and discontinued" in the income statement.

Profits and losses from intercompany transactions valued at equity are eliminated in proportion to the Group's percentage interest in the associate, except where unrealised losses are evidence of a loss in value of the transferred asset.

Changes in equity interests that do not involve a loss of control or relate to investee companies already subject to control are treated as equity transactions (according to the entity control method) and therefore classified under shareholders' equity.

5. Change in consolidation scope

The scope of consolidation as at 31 December 2025 is different from the one as 31 December 2024, as in the first quarter of 2025 Gefran S.p.A. completed the acquisition of 22% of 40Factory S.r.l., recorded among the shareholdings valued at equity. This shareholding is accounted for "at cost" as the value of the Company's shareholders' equity is not representative of its value, since implicit goodwill emerged at the time of acquisition.

In addition, in the second quarter of 2025 Gefran S.p.A. acquired a 60% interest in CZ Elettronica S.r.l. together with its subsidiary Mecatronica S.r.l., now incorporated into its parent, which is registered among the Parent Company's subsidiaries. It should be noted that in the diagrams appearing in the Specific explanatory notes to the consolidated financial statements, the column "Change in consolidation scope" represents the effect of the change in this item following the said acquisition.

6. Measurement criteria

With reference to Consob Communication DEM/11070007 of 5 August 2011, it is specified that the Group does not hold in its portfolio any bonds issued by central or local governments or government agencies, and is therefore not exposed to risks generated by market fluctuations. The consolidated financial statements were prepared using the general historical cost criterion, adjusted as required for the measurement of certain financial instruments.

With reference to Consob Communication No. 0003907 of 19 January 2015, note 13 "Goodwill" includes the required information, and specifically the references to the external information and the sensitivity analysis.

With reference to Consob Communication 0092543 dated 3 December 2015, it is noted that the Report on operations follows the ESMA guidelines (ESMA/2015/1415) for the disclosures needed to ensure the comparability, reliability and understandability of Alternative Performance Indicators.

With reference to Consob communication no. 0007780 of 28 January 2016, it is noted that the impact of market conditions on the information disclosed in the financial statements was considered in the Report on Operations. We also note that the application of IFRS 13 "Fair Value Measurement" by Gefran did not involve significant changes to the financial statements.

It should also be noted that the Company has applied the amendment "Deferred Tax related to Assets and Liabilities arising from a Single Transaction" issued by the IASB on 7 May 2021 and referring to IAS 12 "Income Taxes". The application is effective from 1 January 2023 and the effects have been posted from the first comparative year presented (modified retrospective basis).

Finally, with reference to the amendment called "International Tax Reform-Pillar Two Model Rules-Amendments to IAS 12 (the Amendments)" published by the IASB on 23 May 2023, it should be noted that the Pillar Two Model Rules apply to multinational groups with revenues in their consolidated financial statements exceeding 750 million Euro, in at least two of the four previous financial years. For this reason as well, all the amendments related to the so-called "Global Antibase Erosion Model Rules", including the one published by the IASB on 23 May 2023 and aimed at simplifying deferred tax accounting, are not applicable to the Gefran Group.

Please find below a summary of the most significant measurement criteria adopted by the Gefran Group.

SEGMENT REPORTING

The primary segment reporting format chosen by the Gefran Group is by line of business. The accounting standards used for reporting segment information in the notes are consistent with those used for preparing the Annual financial report. The information provided in the primary segment reporting format relates to revenues, EBITDA and EBIT, and the assets and liabilities of each business unit.

The secondary segment reporting format, as required by IFRS 8, is by geographical region; this format shows revenues, investments and non-current assets based on the location of activities for each business unit. In the Gefran Group, the location of the activity essentially coincides with the location of the customer or entity making the investment.

REVENUES

According to IFRS 15, revenues are stated up to an amount reflecting the payment the entity expects to be entitled to in exchange for the transfer of assets; no distinctions are made between the supply of goods and of services. The new principle, which replaced all the current requirements of the IFRS for the recognition of revenues, was adopted by the Group without any impact resulting from the change in this principle.

Revenues are stated when the company fulfils an obligation (to sell goods or provide services), transferring goods or services, which are considered to have been transferred from the time at which the customer takes control of the goods or services.

When the result of the contract cannot be reliably measured, the revenue is recognised only to the extent that the costs incurred are recoverable.

INTEREST INCOME

Interest income is recognised as financial income using the effective interest rate method, which discounts future cash flows based on the life of the financial instrument and increases the net value of the financial assets reported in the financial statements.

DIVIDENDS

Dividends are recognised when the shareholders' right to receive payment arises, i.e. on the date of the Shareholders' Meeting resolution.

GOVERNMENT GRANTS

Government grants are recorded at fair value when there is a reasonable expectation that they will be received and that all the conditions relating thereto have been met.

When funding is related to cost components (e.g. contributions to expenditure), it is recognised as revenues but broken down systemically over several accounting periods so that the revenues match the costs they are meant to offset. When funding is related to an asset (e.g. grants for plant and equipment), the fair value is temporarily recorded under long-term liabilities, and gradually released to the income statement on a straight-line basis over the expected useful life of the asset concerned.

COSTS

They are recorded on an accruals basis and recognised net of returns, discounts and allowances.

FINANCIAL CHARGES

They are recorded in the income statement when they are incurred, in accordance with the reference accounting treatment set forth in IAS 23.

INCOME TAXES

Income taxes for the period are calculated using an estimate of taxable income. The amount owed to the tax authorities is recorded under tax payables. Taxes paid in excess of the amount due are posted to tax receivables.

Current income taxes relating to items posted to shareholders' equity are reported directly in shareholders' equity and not in the income statement.

Deferred tax assets and liabilities are determined in relation to timing differences between the consolidated values of the asset and the liability and those recognised for tax purposes in the annual financial statements of the consolidated companies. Deferred tax assets are recognised when it is probable that sufficient taxable income is available to allow these assets to be used. Deferred tax liabilities are recognised for all taxable timing differences.

EARNINGS PER SHARE

Basic earnings per ordinary share are calculated by dividing the Group's profit (loss) attributable to ordinary shares by the weighted average number of ordinary shares outstanding during the period, excluding own shares.

For the purposes of calculating the diluted earnings (loss) per ordinary share, the weighted average of outstanding shares is adjusted in line with the assumption that all potential shares resulting from the conversion of bonds or the assignment of options will be subscribed. The Group's net profit (loss) is also adjusted to take into account the impact of these operations, net of taxes.

TANGIBLE ASSETS

Tangible assets are recognised at purchase cost, including ancillary costs. The cost of tangible assets is adjusted for depreciation on the basis of a systematic plan, taking into account the remaining possibility of economic use of the assets and also considering their physical wear and tear. Tangible assets are depreciated on a monthly basis from the time of entry into operation until they are sold or derecognised in the financial statements. If significant parts of tangible assets in use have different useful lives, the components identified are recognised and depreciated separately.

At the time of sale or when no future economic benefits are expected from the use of an asset, it is derecognised in the financial statements, and any gain or loss (calculated as the difference between the selling price and the net carrying value) is recognised in the income statement in the year of derecognition.

Costs for maintenance and ordinary repairs are charged to the income statement in the year in which they are incurred. Extraordinary maintenance costs that entail significant and tangible improvements to plant production capacity or safety or their economically useful lives are capitalised.

LEASES

In 2018, the competent bodies of the European Union completed the approval process necessary for the adoption of IFRS 16 "Leasing". This new standard replaces the previous IAS 17.

The main change concerns the recognition in the accounts by the lessees which, under IAS 17, were required to make a distinction between a finance lease (recognised in accordance with the discounted cash flow method) and an operating lease (recognised on a straight-line basis). With IFRS 16, the accounting treatment of operating leases is placed on the same footing as finance leases. This standard is applicable from 1 January 2019, and early application was possible, together with the adoption of IFRS 15 "Revenues from contracts with customers". The Group has decided to apply the new standard starting from 1 January 2019, on the basis of what is known as the Modified Retrospective approach, according to which the value of assets is entered at the value of the financial liabilities; moreover, as permitted by the IASB, practical expedients have been used such as exclusion of contracts with a residual duration of less than 12 months or contracts for which the fair value of the asset falls under the conventional threshold of 5 thousand US Dollars (modest unitary value).

The assets analysed here are entered in the financial statements:

• / in non-current tangible assets as "Right-of-Use assets";
• / under "Net Financial Position", while the corresponding financial payable originates current (payable within the year) or non-current (payable beyond a year) "Financial payables for leases under IFRS 16".

In assessing the fair value and useful lifespan of the assets which are the subject of the contracts covered by IFRS 16, the following factors are taken into consideration:

• / the amount of the periodic lease or rental payments, as defined in the contract and revalued where applicable;
• / initial ancillary costs, if specified in the contract;
• / final restoration costs, if specified in the contract;
• / the number of outstanding instalments;
• / implicit interest, which, if not stated in the contract, is estimated on the basis of the average rates for the Group's debt.

RESEARCH AND DEVELOPMENT COSTS

Research costs are charged to the income statement at the time that they are incurred. Development costs incurred for a specific project are capitalised when all the following conditions are met:

/ technical feasibility;

/ intention to complete, use or sell the asset;

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

372 373

• / ability to use or sell the asset;
• / probable future economic benefits;
• / availability of sufficient resources;
• / ability to reliably measure the cost attributable to the intangible asset.

Capitalised development costs are amortised on a systematic basis from the start of production and throughout the estimated life of the product. The book value of development costs is reviewed so as to carry out a fairness analysis (so-called "impairment test"), for the purpose of detecting any loss in value when an impairment indicator exists that may raise doubts regarding the possibility of recovering the book value. All other development costs are recognised in the income statement when they are incurred.

BUSINESS COMBINATIONS AND GOODWILL

Business combinations are measured using the acquisition method, on the basis of which the identifiable assets, liabilities and potential liabilities of the company purchased which meet the conditions for entry under IFRS 3 are measured at their current value as of the purchase date. Deferred taxes are then allocated on the adjustments made to the previous carrying values to align them with the present value. Given its complexity, the application of the acquisition method involves an initial provisional phase in which the current values of the assets, liabilities and contingent liabilities acquired are determined, to allow the transaction to be recorded in the consolidated financial statements for the year in which the combination occurred. This initial recognition is completed and adjusted within twelve months of the acquisition date. Changes to the initial consideration due to events or circumstances occurring after the acquisition date are recognised in the statement of profit (loss) for the year.

Goodwill is recognised as the difference between:

/ the sum of the consideration transferred, the amount of minority interests (valued combination by combination, or at fair value or in proportion to the amount of identifiable net assets attributable to minorities), the fair value of interests previously held in the acquiree, recognising any resulting gain or loss in the statement of profit (loss) for the year;

/ the net value of the identifiable acquired assets and the identifiable assumed liabilities.

The costs connected to the combination are not included in the consideration transferred and are therefore recognised in the statement of profit (loss) for the year. If, when the process of determining the present value of the assets, liabilities and contingent liabilities has been completed, this amount exceeds the acquisition cost, the excess is immediately credited to the income statement.

Goodwill is periodically reviewed to check the prerequisites for recoverability, through a comparison with the fair value or with future cash flows from the underlying investment. For the purposes of the comparative analysis, goodwill acquired in a business combination is allocated, at the acquisition date, to the Group's individual cash-generating units, or to the groups of cash-generating units expected to benefit from the synergies of the combination, regardless of whether other assets or liabilities of the Group are assigned to those units or groups of units. Each unit or group of units to which goodwill is allocated:

• / represents the smallest identifiable group of assets generating cash inflows that are largely independent of the cash inflows from other assets or groups of assets;
• / is no bigger than the operating sectors identified based on IFRS 8.

When goodwill is part of a cash-generating unit (group of cash-generating units) and a part of the assets within the unit is sold, the goodwill associated with the asset disposed of is included in the carrying value of the asset to determine the gain or loss on the disposal. Goodwill transferred under these circumstances is measured according to the relative values of the asset disposed of and the retained portion of the unit. When the disposal relates to a subsidiary, the difference between the sale price and the net assets, together with cumulative translation differences and residual goodwill, is posted to the income statement.

ASSET IMPAIRMENT

IAS 36 requires the impairment testing of tangible and intangible assets and equity investments if there are indicators suggesting that such a problem might exist. In the case of goodwill, this test is carried out at least once a year, while intangible assets are tested whenever there are indications of impairment. The recoverability of the asset is assessed by comparing the carrying value recognised in the financial statements with the greater between the net selling price, if an active market exists, and the value in use of the asset.

Value in use is the discounted value of the expected cash flows from use of the asset, or a combination of assets (Cash-Generating Unit), as well as the value expected from disposal at the end of its useful life. The Cash Generating Units have been identified in line with the organisational structure and the Group's business, as homogeneous combinations that generate independent cash flows through the continued use of the assets allocated to them.

OTHER INTANGIBLE ASSETS

Other intangible assets acquired or produced internally are recognised as assets in accordance with the provisions of IAS 38, "Intangible assets", when it is probable that the asset will generate future economic benefits and when the cost of the asset can be reliably determined. Development costs are only recognised under assets if all the following conditions are met:

• / technical feasibility;
• / intention to complete, use or sell the asset;
• / ability to use or sell the asset;
• / probable future economic benefits;
• / availability of sufficient resources;
• / ability to reliably measure the cost attributable to the intangible asset.

The useful life of an intangible asset may be qualified as definite or indefinite. Intangible assets with definite useful lives are amortised on a straight-line basis for the duration of the expected future sales deriving from the related project (usually 5 years). The useful life is reviewed annually and any changes are applied prospectively.

NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED

Non-current assets classified as held for sale and

discontinued are measured in accordance with IFRS 5 at the lower of their carrying value and their fair value minus selling costs. The economic effect of these assets also includes taxation.

INVESTMENTS IN ASSOCIATES AND JOINT VENTURES

Investments in associates and joint ventures are valued at equity, according to which the associate or joint venture is recognised at cost as of the acquisition date; this is subsequently adjusted by the portion pertaining to changes in its shareholders' equity. The losses of associates or joint ventures exceeding the interest held by the Group, including medium to long-term receivables, which effectively are part of the Group's net investment in the associate, are not recognised, unless the Group has taken on the obligation to cover these losses.

The portions of profit (loss) resulting from the application of this consolidation method are posted to the income statement under "Gains (losses) from shareholdings valued at equity".

The surplus acquisition cost compared with the percentage pertaining to the Group of the current value of the associate's identifiable assets, liabilities and contingent liabilities as of the acquisition date represents the goodwill, and continues to be included in the investment's carrying value. The minor value of the acquisition cost compared with the percentage pertaining to the Group of the fair value of the associate's identifiable assets, liabilities and contingent liabilities as of the acquisition date is posted to the income statement for the year when the application process of the acquisition method is completed, or within 12 months of the acquisition.

If an associate or joint venture recognises adjustments directly attributable to shareholders' equity and/or in the statement of comprehensive income, the Group in turn records the related portion under shareholders' equity, and where applicable, includes it in the statement of changes in shareholders' equity and/or the statement of other items of comprehensive income.

Any loss due to impairment recognised pursuant to IAS 36 is not attributable to goodwill or to any asset contributing to the carrying value of the equity investment in the associate, rather to the value of the equity investment overall. Any reversal of value is therefore recognised fully to the extent that the recoverable value of the investment subsequently increases based on the result of the impairment test.

374 375

EQUITY INVESTMENTS IN OTHER COMPANIES

Equity investments in other companies are measured at fair value. The change in fair value recognised during the period is acknowledged in the statement of profit/(loss) for the year and other comprehensive income, among items that will not be subsequently reclassified to the statement of profit/(loss) for the year.

INVENTORIES

Inventories are valued at the lower of acquisition or production cost and market value. Ancillary costs are included in the acquisition cost. The following cost configuration is used:

• / raw materials, consumables, products sold: weighted average cost;
• / work in progress: production cost;
• / finished and semi-finished products: production cost.

Production cost includes the cost of raw materials, materials, labour and all other direct production expenses, including depreciation and amortisation. Production cost does not include distribution costs. Obsolete or slow-moving inventories are written down according to the possibility of using or realising them.

TRADE RECEIVABLES AND PAYABLES AND OTHER RECEIVABLES/PAYABLES

Receivables are recognised in the financial statements at their presumed realisable value, consisting of their value adjusted, if necessary, by specific impairment provisions. Trade receivables have due dates that fall within normal contractual periods (30 to 120 days) and are therefore not discounted.

Regarding the introduction of IFRS 9, and particularly the new method for impairment of financial investments, the Group has revised its method for determination of the reserve to be used for coverage of losses on receivables, taking into account the losses expected throughout the life of the receivable, as required by the new standard.

Receivables factored without recourse are removed from the financial statements when all the risks associated with the sale of the receivable are borne by the factoring company.

Payables are stated at amortised cost. Trade payables have due dates that fall within normal contractual periods (60 to 120 days) and are therefore not discounted.

FINANCIAL DERIVATIVES

Derivatives are classified as "Hedging transactions" if the conditions exist for the application of hedge accounting; otherwise, even if undertaken with the intention of managing risk exposure, they are recorded as "Financial assets held for trading". Financial derivatives may be recognised using the methods established for hedge accounting only when the relationship between the derivative and the hedged item is formally documented and the hedge effectiveness is high (effectiveness test). The effectiveness of hedge transactions is documented both at the start of the transaction and periodically (at least at each reporting date of the financial statements or interim statements) and measured by comparing changes in the fair value of the hedging instrument with those of the hedged item.

When hedging transactions hedge the risk of changes in the fair value of hedged instruments (fair value hedges), derivatives are recognised at fair value and the effects are charged to the income statement. The Gefran Group does not hold derivatives of this kind.

When derivatives hedge the risk of changes in the cash flows of the hedged instruments (so-called cash flow hedges), changes in the fair value of the derivatives are initially recorded under other items of comprehensive income and are then reclassified from shareholders' equity to profit (loss) for the period as a reclassification adjustment, in line with the economic effects of the hedged transaction. The change in fair value relating to the ineffective portion is recognised immediately in the income statement for the period. If the derivative is sold or no longer qualifies as an effective hedge against the risk for which it was initiated, or the occurrence of the underlying transaction is no longer regarded as highly probable, the portion of the "Cash flow hedge reserve" relating thereto is immediately reversed to the income statement.

The Group believes that all its existing hedges currently designated as effective hedges continue to qualify for hedge accounting under IFRS 9. As IFRS 9 does not alter the general principle on the basis of which an entity registers effective hedging, the application of this principle has not had any significant impact on the Group.

The Gefran Group uses financial derivatives such as Interest Rate Swaps (IRS) and Interest Rate Caps (CAP). Changes in the fair value of derivatives that do not qualify for hedge accounting are recognised in the income statement. Regardless of classification, all derivatives are measured at fair value using valuation techniques based on market data (such as, inter alia, discounted cash flow, the forward exchange rate method and the Black-Scholes formula and its developments).

CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash on hand and demand and short-term bank deposits, which are highly liquid and subject to an insignificant risk of changes in value. These are stated at their presumed realisable value.

FINANCIAL LIABILITIES

Payables and financial liabilities are initially recorded at fair value, which essentially coincides with the amount to be paid, net of transaction costs. Purchases and sales of financial liabilities are recognised on the trading date, i.e. the date on which the Group committed to purchase/

sell the liabilities.

Management determines the classification of financial liabilities in the categories identified at the time of their initial recognition. After initial recognition, financial liabilities are valued in relation to their classification within one of these categories. In detail, it is highlighted that:

/ the valuation of "Financial liabilities at fair value through profit or loss" is carried out using the market value at the close of the reporting period; in the case of unlisted instruments (e.g. financial derivatives) it is carried out using financial valuation techniques based on market data. Gains or losses arising from fair value measurement relating to assets and liabilities held for

• trading are recognised in the income statement;

/ the valuation of "Financial liabilities valued at amortised cost", carried out at amortised cost, in the case of instruments maturing within 12 months uses the nominal value as an approximation of amortised cost.

Payables denominated in foreign currencies are adjusted to year-end exchange rates and gains or losses resulting from the adjustment are recognised in the income statement.

The Group believes that all its existing hedges currently designated as effective hedges continue to qualify for hedge accounting under IFRS 9.

OWN SHARES

Own shares are reported as a reduction of shareholders' equity in a specific reserve. The original cost of the own shares and the income generated by any subsequent sales are recognised as changes in shareholders' equity.

PROVISIONS FOR RISKS AND FUTURE LIABILITIES

Allocations to provisions for risks and future liabilities take place when the Group has a current obligation (legal or implicit) arising from a past event, it is probable that a financial outlay will take place to meet the obligation and a reliable estimate can be made of the obligation. These may be divided into current funds, when the financial outlay is planned to take place by the end of the year, and non-current provisions, if the financial outlay is planned beyond 12 months.

Allocations to provisions for risks and future liabilities exceeding one year are discounted only if the effect of discounting is material, at a pre-tax discount rate that reflects current market assessments of the value of money in relation to time and, if appropriate, the specific risks associated with the liability. When discounting back takes place, the increase in the provision due to the passage of time is recognised as a financial charge.

EMPLOYEE BENEFITS

The post-employment benefit reserve, which is mandatory for Italian companies pursuant to Italian Law 297/1982, is considered a defined benefit plan and is based, inter alia, on the working lives of employees and the remuneration earned by the employee over a predetermined period of service. The post-employment benefit reserve is calculated by independent actuaries using the "Traditional Unit Credit Method". The Company has opted to recognise all cumulative actuarial gains and losses both on first-time adoption of IFRS and subsequently.

This item is also used to recognise potential non-competition agreements, signed with some employees to protect the company from any competitive activities; the value of the obligation is the subject of actuarial valuation and, when first recognised, the portion of the provision determined by actuarial methods is posted to the statement of profit/(loss) for the year.

376 377

TRANSLATION OF FOREIGN COMPANIES' FINANCIAL STATEMENTS

The financial statements of subsidiaries, associates and joint ventures are prepared using the functional currency of the individual entity. The consolidated financial statements are denominated in the functional currency of the Parent Company Gefran S.p.A.

The rules for the translation of the companies' financial statements denominated in currencies other than the euro are as follows:

• / assets and liabilities are translated at the exchange rates at the reporting date;
• / costs and revenues are translated at the average exchange rates in the period;
• / the "Currency translation reserve" includes both the exchange rate differences resulting from the translation of economic parameters at an exchange rate other than that at closing, and those generated by translating the opening shareholders' equity at an exchange rate other than that at the close of the reporting period.

When an investment in a foreign company is disposed of, the accumulated exchange rate differences recognised in the "Currency translation reserve", relating to a particular foreign company, are reported in the statement of profit/(loss) for the year.

TRANSLATION OF FOREIGN CURRENCY ITEMS

Foreign currency transactions are implemented by each entity at the conversion rate prevailing at the accounting date. Subsequently, at the time of payment or collection, the exchange rate difference arising from the time difference between the two moments is recorded and posted to the income statement.

From an equity point of view, at the close of the reporting period, receivables and liabilities arising from transactions in currencies other than the functional currency are reassessed in the company's currency, taking as benchmark the exchange rate prevailing at the reporting date. Also in this case, the exchange rate difference is posted to the income statement.

Non-monetary items denominated in foreign currencies are translated into the functional currency at the exchange rate prevailing at the transaction date, i.e. at the historical exchange rate.

7. Accounting standards, amendments and interpretations applied since 1 January 2025

The amendment to IAS 21 "The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability", was published by the IASB in August 2023, endorsed by the European Commission on 13 November 2024 and applicable since 1 January 2025.

Gefran assessed and verified the absence of impacts of the amendments in relation to situations in which a currency cannot be traded on regulated markets or mechanisms. The adoption of this amendment has had no effect on the Group's financial statements.

8. Accounting standards, amendments and interpretations not yet applicable or not applied in

advance

The following are new IFRS standards, amendments and interpretations approved by the IASB and endorsed by the European Union, but not yet mandatorily applicable, for which the Gefran Group has not opted for early adoption:

/ Amendment entitled "Classification and Measurement of Financial Instruments – Amendments to IFRS 9 and IFRS 7", published on 30 May 2024, which clarifies certain aspects on the accounting treatment of financial instruments (including financial assets related to the achievement of ESG objectives); the amendments will apply from 1 January 2026 and no significant effects on the Group's financial statements are currently expected, since many of the cases included in the amendment, where present, are

• not significant;

/ Amendment entitled "Contracts Referencing Nature-dependent Electricity – Amendments to IFRS 9 and IFRS 7", published on 18 December 2024, with the aim of supporting the reporting of the financial effects deriving from contracts for the purchase of electricity from renewable sources; the amendments will be applicable from 1 January 2026 and early application is permitted; Gefran is analysing the changes introduced, assessing any effects on its Group financial statements (currently considered not significant);

• / Package of amendments to IFRS 1 "First-time Adoption of International Financial Reporting Standard", IFRS 7 "Financial Instruments: Disclosures" and corresponding guidelines for its implementation, IFRS 9 "Financial Instruments", IFRS 10 "Consolidated Financial Statements" and IAS 7 "Statement of the Cash Flows" described in the document entitled "Annual Improvements Volume 11" published on 18 July 2024; these amendments are aimed at improving consistency between the various Accounting Standards and are expected to apply from 1 January 2026 (early application is permitted); the new standards are being analysed by Gefran, which is assessing any effects on its Group financial statements (currently deemed not significant);
• / New IFRS 18 "Presentation and Disclosure in Financial Statements", published on 9 April 2024, replacing IAS 1 "Presentation of Financial Statements" with the aim of improving the presentation of financial statements; it will enter into force on 1 January 2027 (early application is permitted) and will affect the presentation of the financial statements of the Gefran Group.

In addition, at the date of this Annual financial report, the following have been approved by the IASB but not yet endorsed by the European Union and will become effective in the future:

• / New IFRS 19 "Subsidiaries without Public Accountability: Disclosures", which simplifies the disclosures required by IFRSs when presenting the financial statements of a subsidiary that meets certain requirements; published on 9 May 2024, it will enter into force on 1 January 2027 (early application is permitted) and will have no impact on the financial statements of the Gefran Group; however, the effects on the presentation of the financial statements of the subsidiaries of Gefran S.p.A., which meet the characteristics described by the standard, are being assessed;
• / Amendments to IAS 21 "Translation to a Hyperinflationary Presentation Currency", which deal with some clarifications on the translation method when the presentation currency is hyperinflationary while the functional currency is not; published on 13 November 2025, they are expected to enter into force on 1 January 2027 (early application is permitted) and at the moment it is estimated that they will have no impact on the Gefran Group's financial statements.

9. Main decisions in the application of accounting standards and uncertainties when making estimates

In drafting the Financial Statements and the Explanatory Notes to the accounts, in accordance with the IAS/IFRS principles, the Group makes use of estimates and assumptions to assess certain items. These are based on historical experience and uncertain but realistic assumptions that are assessed regularly and, if necessary, updated, with effect on the income statement for the period and prospectively. The uncertainty inherent in these assessments may lead to misalignment between the estimates made and recognition in the financial statements of the actual effects of the forecasted events.

Below are the processes that require Management to perform assessment estimates, and with regard to which a change in the underlying conditions might have a significant impact on the consolidated financial data.

INVENTORY ALLOWANCE

Inventories are stated at their purchase cost (measured using the weighted average cost method) or, if lower, their net realisable value. The inventory allowance is needed to align the value of inventories with their estimated realisable value: inventories are analysed to identify slow-moving items, so as to recognise a provision that reflects their potential obsolescence.

PROVISION FOR DOUBTFUL RECEIVABLES

The provision for doubtful receivables reflects Management's estimates regarding the recoverability of receivables from customers. This assessment is based on past experience and an analysis of situations faced with known or probable collection risks.

Regarding the introduction of IFRS 9, and particularly the new method for impairment of financial investments, the Group adopts the method for determination of the reserve to be used for coverage of losses on receivables, taking into account the losses expected throughout the life of the receivable, as required by the new standard.

GOODWILL AND INTANGIBLE ASSETS

WITH AN INDEFINITE LIFE

These are measured periodically using impairment tests, with the aim of determining their present value and recognising any differences with respect to their carrying amounts; for details, see the specific notes to the financial statements.

EMPLOYEE BENEFITS AND NON-COMPETITION AGREEMENTS

The provisions for post-employment benefits and non-competition agreements are recorded in the financial

statements and remeasured annually by external actuaries who, inter alia, make assumptions about the discount rate, inflation and demographic assumptions; for details, see the specific note to the financial statements.

DEFERRED TAX ASSETS

The recoverability of deferred tax assets is periodically evaluated, based on the results achieved and on the industrial plans prepared by Management.

CURRENT AND NON-CURRENT PROVISIONS

Provisions are made for risks that will probably have an adverse outcome. The provisions recorded in the financial statements reflect Management's best estimate of the risk at that time. This estimate entails the adoption of assumptions that depend on factors that may change over time and that may, therefore, have a significant effect on the current estimates made by Management in preparing the Group's consolidated financial statements.

With regard to the assessment of the risks associated with the Group's activities, Gefran assesses the effects of ongoing climate change, reporting the results of these assessments in the paragraph Main risks and uncertainties to which the Gefran Group is exposed, as well as in the section ESRS E1 Climate change of the Sustainability Report. In particular, the assessments carried out on physical and transition climate risks, based on several scenarios, ensure the reasonable resilience of assets and the sustainability of the Group's activities in the short, medium and long term. Changes in scenarios may of course have different effects, but they are currently considered not likely. The assessment considered the Group's production sites, sales offices and main suppliers, and did not reveal any significant financial effects. At present, no factors related to climate change that might affect the recoverability of goodwill, and no impairment indicators that may affect the recoverability of non-current assets with a finite useful life, have been identified. The assessments made to date on potential legislative or regulatory changes relating to climate change do not establish the need to allocate funds for any liabilities linked to environmental risks.

Annual Financial Report at 31 december 2025 Gefran Group

10. Business combinations

On 14 April 2025 Gefran S.p.A. purchased 60% of the shares in CZ Elettronica S.r.l. for a payment of 870 thousand Euro, paid on that date, without resorting to loans. The transaction also included the acquisition of 60% of Mecatronica S.r.l., a subsidiary of CZ Elettronica S.r.l., which on 4 September 2025 was merged by incorporation with the Parent Company.

The net assets acquired by the Group amount to 715 thousand Euro, as detailed below:

(Euro/000)	Net total
Cash present in the acquired Company,
attributable to:
Group	79
Third parties	52
Group financial outlay for the
acquisition	870
Group cash flow from acquisition	(791)

(Euro/000)	CZ ElettronicaS.r.l.	MecatronicaS.r.l.	Net total
Property, plant, machinery and tools	18	2	20
Receivables and other non-current assets	12	10	22
Deferred tax assets	-	6	6
Inventories	577	159	736
Trade receivables	1,385	356	1,496
Other receivables and assets	162	17	179
Current tax receivables	27	-	27
Cash and cash equivalents	128	3	131
TOTAL ASSETS WITHIN SCOPE OF ACQUISITION	2,309	553	2,617
Attributable to:
Group	1,385	332	1,570
Third parties	924	221	1,047
Employee benefits	277	85	362
Current financial payablesTrade payables	12554	-87	12396
Current tax payables	44	-	44
Other payables and liabilities	500	112	612
TOTAL LIABILITIES WITHIN SCOPE OF ACQUISITION	1,387	284	1,426
Attributable to:
Group	832	170	856
Third parties	555	114	570
NET VALUE ACQUIRED BY THE GROUP	553	161	715

The greater value paid, equal to 155 thousand Euro, was thus determined, which led to a consolidation difference:

(Euro/000)	Net total
Acquisition value (A)	870
Fair value of net assets acquired
(B)	715
Difference in value paid (A-B)	155

The Group recorded the business combination as goodwill.

Finally, it should be noted that, as described in the paragraph Significant events after the end of 2025, on 23 February 2026, Gefran S.p.A. exercised, in advance, the purchase option already provided for in the agreements with the sellers, by acquiring the remaining 40% of the shares in CZ Elettronica S.r.l., for a consideration of 580 thousand Euro, thereby holding 100% of the subsidiary. This led to the elimination of the third parties' share and the recognition of payables amounting to 580 thousand Euro.

Annual Financial Report at 31 december 2025 Gefran Group

11. Financial instruments: supplementary disclosure pursuant to IFRS 7

The Group's activities are exposed to different types of risk: market risk (including exchange-rate risks, interest-rate risks and price risks), credit risk and liquidity risk. The Group's risk management strategy focuses on the unpredictability of markets and is intended to minimise the potential adverse impact on the Group's results. Certain types of risk are mitigated through the use of derivatives. Coordination and monitoring of the main financial risks are centralised in the Group's Finance and Administration Department, as well as in the Purchasing function as regards price risk, in close collaboration with the Group's operating units. Risk management policies are approved by the Group's Administration, Finance and Control Department, which provides written guidelines for managing the risks listed above and using financial derivatives and other financial instruments. In the context of the sensitivity analyses described below, the effect on net profit and shareholders' equity is determined gross of the tax effect.

EXCHANGE RATE RISKS

The Group is exposed to the exchange rate risk in relation to commercial transactions and cash on hand held in currencies other than the Euro, which is the Group's functional currency. Around 36% of sales are denominated in a different currency. Specifically, the Group is most exposed to the following exchange rates:

• / Euro/USD, about 10%, primarily in relation to the commercial relations of Gefran Inc. (operating in the United States) and Gefran Asia (operating on the Asian market), which are both foreign subsidiaries;
• / Euro/RMB, about 18%, in relation to Gefran Automation Technology (operating in China);
• / the remainder is divided between Euro/BRL, Euro/GBP, Euro/CHF, and Euro/INR.

With reference to the two main currencies, at 31 December 2025 trade receivables included 2,874 thousand US dollars and trade payables included 2,101 thousand US dollars (at 31 December 2024, receivables included 2,807 thousand US dollars and payables included 1,883 US dollars); trade receivables also included 20,574 thousand renminbi and trade payables also included 3,898 thousand renminbi (at 31 December 2024, receivables included 16,948 thousand renminbi and payables included 1,793 thousand renminbi).

The sensitivity of the fair value of reported assets and liabilities to hypothetical and unexpected 5% and 10% exchange rate fluctuations is shown below.

		31 December 2025		31 December 2024
(Euro /000)	-5%	+5%	-5%	+5%
Chinese renminbi	107	(97)	105	(95)
US dollar	33	(30)	47	(42)
Total	140	(127)	152	(137)

		31 December 2025	31 December 2024
(Euro /000)	-10%	+10%	-10%	+10%
Chinese renminbi	226	(185)	222	(182)
US dollar	70	(57)	99	(81)
Total	296	(242)	321	(263)

The sensitivity of the fair value of the net profit for the period to hypothetical and unexpected 5% and 10% fluctuations in the most significant exchange

rates is shown below.

		31 December 2025		31 December 2024
(Euro /000)	-5%	+5%	-5%	+5%
Chinese renminbi	37	(33)	57	(52)
US dollar	54	(49)	26	(23)
Total	91	(82)	83	(75)

		31 December 2025		31 December 2024
(Euro /000)	-10%	+10%	-10%	+10%
Chinese renminbi	78	(64)	121	(99)
US dollar	115	(94)	55	(45)
Total	193	(158)	176	(144)

The sensitivity to hypothetical and unexpected fluctuations in the most significant exchange rates of 5% and 10% in the fair value of the shareholders'

equity is shown below.

	31 December 2025			31 December 2024
(Euro /000)	-5%	+5%	-5%	+5%
Chinese renminbi	535	(484)	594	(537)
US dollar	488	(441)	540	(488)
Total	1,023	(925)	1,134	(1,025)

	31 December 2025			31 December 2024
(Euro /000)	-10%	+10%	-10%	+10%
Chinese renminbi	1,129	(923)	1,253	(1,026)
US dollar	1,029	(842)	1,139	(932)
Total	2,158	(1,765)	2,392	(1,958)

INTEREST RATE RISK

The interest rate risk to which the Group is exposed mainly originates from variable rate financial payables (totalling 15,876 thousand Euro at 31 December 2025), which expose the Group to a risk arising from interest rate volatility (cash flow risk). The Group's Administration and Finance Department monitors the exposure to interest rate risk and proposes appropriate hedging strategies to contain the exposure within the limits defined and agreed in the Group's policies, using derivatives, Interest Rate Swaps (IRS) and Interest Rate Caps (CAP) when necessary.

The table below shows a sensitivity analysis of the impact that an interest rate increase/decrease of 100 basis points would have on consolidated net profit/(loss), comparing interest rates at 31 December 2025 and at 31 December 2024, while keeping other variables unchanged.

		31 December 2025		31 December 2024
(Euro /000)	(100)	100	(100)	100
Euribor	532	(532)	597	(597)
Total	532	(532)	597	(597)

The potential impacts reported above have been calculated on the basis of the net liabilities representing the most significant part of the Group's payables as of the date of this Annual financial report and calculating the effect of net financial charges on this amount resulting from changes in annual interest rates.

The net liabilities considered in this analysis include variable-rate financial receivables and payables, cash on hand, and financial derivatives, the value of which is affected by interest rate fluctuations.

The table below shows the carrying value at 31 December 2025, broken down by maturity, of the Group's financial instruments exposed to interest rate risk.

(Euro /000)	<1 year	1 - 5 years	>5 years old	Total
Loans	4,872	11,623	74	16,569
Financial payables due to leasingunder IFRS 16	1,230	2,207	172	3,609
Other accounts payable	45	-	-	45
Account overdrafts	4	-	-	4
Total liabilities	6,151	13,830	246	20,227
Cash in current accounts	53,125	-	-	53,125
Total assets	53,125	-	-	53,125
Total variable rate	46,974	(13,830)	(246)	32,898

By contrast with the analysis of the Net Financial Position, the amounts shown in the table above exclude the fair value of derivatives (positive by 173 thousand Euro), cash on hand (positive by 15 thousand Euro) and other non-current assets that include financial pre-paid expenses and bond coupons (total 102 thousand Euro).

The table below shows the carrying value at 31 December 2024, broken down by maturity, of the Group's financial instruments exposed to interest rate risk.

(Euro /000)	<1 year	1 - 5 years	>5 years old	Total
Loans	5,112	15,852	417	21,381
Financial payables due to leasingunder IFRS 16	1,195	2,257	407	3,859
Other accounts payable	60	-	-	60
Total liabilities	6,368	18,109	824	25,301
Cash in current accounts	59,615	-	-	59,615
Total assets	59,615	-	-	59,615
Total variable rate	53,247	(18,109)	(824)	34,314

LIQUIDITY RISK

Prudent management of liquidity risk arising from the Group's normal operations means that an appropriate level of cash on hand and short-term securities must be maintained, together with the possibility to draw funds from an appropriate amount of committed credit lines.

The Group's Administration and Finance Department monitors forecast uses of the Group's liquidity reserves based on expected cash flows. The following table analyses the liquidity reserves available on the specified reporting dates.

(Euro /000)	31 December2025	31 December2024	Change
Cash and cash equivalents	15	14	1
Cash in bank deposits	53,125	59,615	(6,490)
Total liquidity	53,140	59,629	(6,489)
Multiple mixed credit lines	20,500	21,200	(700)
Cash flexibility credit lines	3,150	3,225	(75)
Credit lines on invoice	2,000	2,150	(150)
Total credit lines available	25,650	26,575	(925)
Total liquidity available	78,790	86,204	(7,414)

To complete the disclosure about financial risks, the following table reconciles the financial assets and liabilities reported in the Group's statement of financial position with those identified pursuant to IFRS 7 requirements.

(Euro /000)	Level 1	Level 2		Total
Available-for-sale assets and
discontinued operations valued at
fair value:
Shareholdings valued at fair value
with a balancing item in other	169	-	1,616	1,785
overall profit/(loss)
Hedging transactions	-	5	-	5
Total assets	169	5	1,616	1,790
Hedging transactions	-	(178)	-	(178)
Total liabilities	-	(178)	-	(178)

The following table reconciles the financial assets and liabilities reported in the Group's statement of financial position at 31 December 2024 with those identified pursuant to IFRS 7 requirements.

(Euro /000)	Level 1	Level 2		Total
Available-for-sale assets and
discontinued operations valued at
fair value:
Shareholdings valued at fair value
with a balancing item in other	201	-	1,609	1,810
overall profit/(loss)
Hedging transactions	-	34	-	34
Total assets	201	34	1,609	1,844
Hedging transactions	-	(311)	-	(311)
Total liabilities	-	(311)	-	(311)

Level 1: Fair values represented by the prices - listed in active markets (unadjusted) - of financial instruments identical to those being valued that may be accessed at the measurement date. These prices are defined as markto-market inputs as they provide a fair value measurement based directly on official market prices, therefore without the need for any modification or adjustment. The change compared to the value at 31 December 2024 corresponds to the equity investment Woojin Plaimm Co Ltd, the value of which decreased by 32 thousand Euro.

Level 2: Fair values determined using measurement techniques based on variables that may be observed in active markets, which in this case include the measurement of interest-rate and exchange-rate hedges. As with the Level 1 inputs, the reference value is mark-to-market, i.e. the evaluation method whereby the value of a financial instrument or contract is systematically adjusted according to the current market prices.

Level 3: Fair values determined using measurement techniques based on market variables that may not be observable, which in particular refer to equity investments in other companies not listed on international markets. This item mainly relates to the shareholding in Colombera S.p.A. (1,582 thou-

sand Euro).

CREDIT RISK

The Group grants its customers deferred payment conditions, which vary according to the market practices in individual countries. The solvency of all customers is monitored regularly and any risks are periodically covered by appropriate provisions. Despite these precautions, under current market conditions, it is possible that some customers may be unable to generate sufficient cash flow or access sufficient sources of funding, resulting in payment delays or failure to honour their obligations.

Receivables are adjusted to their estimated realisable value by the allowance for doubtful receivables, which is determined pursuant to IFRS 9 with reference to the expected credit losses on each position, taking account of past experience in each business area and geographical region.

The Group has developed estimates based on the best information available about past events, current economic conditions and forecasts for the future. The analyses conducted to determine the existence of this risk are based

primarily on a few factors:

/ the potential effects of extraordinary events (e.g. ongoing conflicts) on the

/ the support measures implemented by governments;

• economic system;
• default by customers.

/ the recoverability of receivables following changes in the probability of

With reference to this last point, the Group has performed analyses using a risk matrix that takes geographical region, business area and individual customer solvency in account.

Management considers the forecasts thus generated to be reasonable and sustainable despite the current climate of uncertainty.

Below are the values of gross trade receivables at 31 December 2025 and 31 December 2024.

(Euro /000)	Totalvalue	Notoverdue	Overdueby up to 2months	Overdueby 2 to 6months	Overdueby 6 to 12months	Overdueby morethan 12months	Receivablesindividuallywritten down
Gross trade receivablesat 31 December 2025	27,051	23,509	1,875	466	73	333	795
Gross trade receivablesat 31 December 2024	24,160	21,290	1,659	252	78	175	706

The Gefran Group has established formal procedures for granting credit limits and for credit collection by the credit function, in partnership with leading external law firms. All the procedures put in place are intended to reduce credit risk. The exposure to other forms of credit, such as financial receivables, is monitored constantly and reviewed monthly, or at least quarterly, in order to identify any losses or collection risks.

RISK OF CHANGE IN RAW MATERIAL PRICES

Since the Group's production mainly involves mechanical, electronic and assembly processes, exposure to energy price fluctuations is limited. The Group is exposed to changes in basic commodity prices (e.g. metals) to a small extent, given that the product cost component related to these materials is very limited.

The purchase prices of key components are usually agreed with counterparties for the full year and reflected in the budget. The structured and formalised governance systems adopted by the Group mean that the margins earned can be analysed periodically.

As regards the recent rise in prices, also related to developments in the geo-political situation, key factors were in-depth knowledge of the product and the synergy between the various company areas, which made it possible to promptly navigate new technological roads, broaden the spectrum of choices and introduce new supply opportunities, in order to mitigate the effect of rising prices.

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

All financial instruments are recorded in the Group's financial statements at fair value. The carrying value of the financial liabilities measured at amortised cost is deemed to approximate their fair value at the reporting date.

The following table summarises the Group's net financial position, comparing fair value and carrying value:

		carrying value		fair value
(Euro /000)	31 December2025	31 December2024	31 December2025	31 December2024
Financial assets
Cash and cash equivalents	15	14	15	14
Cash in bank deposits	53,125	59,615	53,125	59,615
Financial assets for derivatives	5	34	5	34
Non-current financial investments	102	104	102	104
Total financial assets	53,247	59,767	53,247	59,767
Financial liabilities
Current portion of long-term debt	(4,872)	(5,112)	(4,872)	(5,112)
Short-term bank debt	(4)	(1)	(4)	(1)
Financial liabilities for derivatives	(178)	(311)	(178)	(311)
Payables due to leasing contractsunder IFRS 16	(3,609)	(3,859)	(3,609)	(3,859)
Other financial payables	(45)	(60)	(45)	(60)
Non-current financial debt	(11,697)	(16,269)	(11,697)	(16,269)
Total financial liabilities	(20,405)	(25,612)	(20,405)	(25,612)
Total net financial position	32,842	34,155	32,842	34,155

12. Information by business area

Primary segment – sector of activity

The Gefran Group's organisational structure is divided into two sectors of activity: sensors and automation components. The economic trends and principal investments are discussed in the Report on Operations.

FIGURES BY BUSINESS AREA

(Euro /000)	Sensors	Automation	components Eliminations	Notdivided	31December2025
a Revenues	90,929	56,254	(8,219)		138,964
b Increases for internal work	1,077	1,148	-		2,225
c Consumption of materials andproducts	26,857	23,077	(8,219)		41,715
d Added Value (a+b-c)	65,149	34,325	-	-	99,474
e Other operating costs	15,139	8,732	-		23,871
f Personnel costs	31,313	21,847	-		53,160
g EBITDA (d-e-f)	18,697	3,746	-	-	22,443
h Depreciation, amortisation andimpairment	4,638	3,472			8,110
i EBIT (g-h)	14,059	274	-	-	14,333
l Gains (losses) from financialassets/liabilities				(725)	(725)
m Gains (losses) from shareholdingsvalued at equity				12	12
n Profit (loss) before tax (i±l±m)	14,059	274		(713)	13,620
o Taxes				(3,751)	(3,751)
p Net profit (loss) (n±o)	14,059	274		(4,464)	9,869
Attributable to:
Group					9,869
Third parties					-

(Euro /000)		Sensors Automationcomponents Eliminations		Notdivided	31December2024
a Revenuesb Increases for internal work	84,664615	54,9371,533	(6,994)-		132,6072,148
c Consumption of materials andproducts	23,690	22,629	(6,994)		39,325
d Added Value (a+b-c)	61,589	33,841	-	-	95,430
e Other operating costs	14,187	8,714	-		22,901
f Personnel costs	29,002	20,471	-		49,473
g EBITDA (d-e-f)	18,400	4,656	-	-	23,056
h Depreciation, amortisation andimpairment	4,634	3,297			7,931
i EBIT (g-h)	13,766	1,359	-	-	15,125
l Gains (losses) from financialassets/liabilities				189	189
m Gains (losses) from shareholdingsvalued at equity				39	39
n Profit (loss) before tax (i±l±m)	13,766	1,359		228	15,353
o Taxes				(4,211)	(4,211)
p Net profit (loss) (n±o)	13,766	1,359		(3,983)	11,142
Attributable to:
Group					11,142
Third parties					-

c Consumption of materials and
h Depreciation, amortisation and
l Gains (losses) from financial
m Gains (losses) from shareholdings
Attributable to:

To ensure correct interpretation of figures relating to the individual activities,

it should be noted that:

/ the business represents the sum of revenues and related costs of the Parent Company Gefran S.p.A. and of the Group subsidiaries;

/ the figures for each business are provided gross of trade between differ-

/ inter-sector sales (trade) are booked at transfer prices that are broadly in

• ent businesses;
• line with market prices;
• ic-technical criteria.

/ the costs of the central functions, which principally pertain to Gefran S.p.A., are fully allocated to the businesses, where possible, and quantified according to actual use; they are otherwise divided according to econom-

It should be added that the results of the subsidiary CZ Elettronica S.r.l. (acquired during the second quarter of 2025 together with its subsidiary Mecatronica S.r.l., subsequently incorporated into its parent as described in Significant events in 2025), are included in the automation components business.

STATEMENT OF FINANCIAL POSITION FIGURES BY BUSINESS AREA

(Euro /000)	Sensors	Automationcomponents	Not divided	31 December 2025	Sensors	Automationcomponents	Not divided	31 December 2024
Intangible assets	9,459	4,601		14,060	9,028	4,302		13,330
Tangible assets	25,347	16,614		41,961	25,997	15,371		41,368
Other non-current assets			8,851	8,851			5,058	5,058
Net non-current assets	34,806	21,215	8,851	64,872	35,025	19,673	5,058	59,756
Inventories	8,087	7,095		15,182	7,615	8,132		15,747
Trade receivables	13,821	12,195		26,016	11,980	11,284		23,264
Trade payables	(11,771)	(9,800)		(21,571)	(9,552)	(9,243)		(18,795)
Other assets/liabilities	(5,939)	(4,938)	(1,286)	(12,163)	(4,884)	(4,193)	(1,383)	(10,460)
Working capital	4,198	4,552	(1,286)	7,464	5,159	5,980	(1,383)	9,756
Provisions for risks and future liabilities	(567)	(505)	(84)	(1,156)	(671)	(523)	(71)	(1,265)
Deferred tax provisions			(985)	(985)			(933)	(933)
Employee benefits	(763)	(1,445)		(2,208)	(851)	(1,280)		(2,131)
Net invested capital	37,674	23,817	6,496	67,987	38,662	23,850	2,671	65,183
Group Shareholders' equity			100,829	100,829	-	-	99,338	99,338
Shareholders' equity of minority interests			-	-	-	-	-	-
Shareholders' equity	-	-	100,829	100,829	-	-	99,338	99,338
Non-current financial payables			11,697	11,697			16,269	16,269
Current financial payables			4,921	4,921			5,173	5,173
Financial payables for IFRS 16 leases (current andnon-current)			3,609	3,609			3,859	3,859
Financial liabilities for derivatives (current andnon-current)			178	178			311	311
Financial assets for derivatives (current andnon-current)			(5)	(5)			(34)	(34)
Other non-current financial investments			(102)	(102)			(104)	(104)
Cash and cash equivalents and current financial			(53,140)	(53,140)			(59,629)	(59,629)
receivables
Net debt relating to operations	-	-	(32,842)	(32,842)	-	-	(34,155)	(34,155)
Total sources of financing	-	-	67,987	67,987	-	-	65,183	65,183

Annual Financial Report at 31 december 2025 Gefran Group

Secondary segment - geographical region

REVENUES BY GEOGRAPHICAL REGION

(Euro /000)	31 December2025	31 December2024	Change	%
Italy	43,834	40,378	3,456	8.6%
European Union	34,419	34,322	97	0.3%
Europe non-EU	4,258	3,883	375	9.7%
North America	12,606	13,093	(487)	-3.7%
South America	5,954	5,869	85	1.4%
Asia	36,147	33,521	2,626	7.8%
Rest of the world	493	464	29	6.3%
Total	137,711	131,530	6,181	4.7%

INVESTMENTS BY GEOGRAPHICAL REGION

		31 December 2025	31 December 2024
(Euro /000)	intangibleassets andgoodwill	tangible assets	intangibleassets andgoodwill	tangible assets
Italy	2,522	5,595	2,560	2,630
European Union	10	75	-	106
Europe non-EU	256	81	-	36
North America	-	60	-	703
South America	2	107	18	59
Asia	-	680	-	251
Total	2,790	6,598	2,578	3,785

NON-CURRENT ASSETS BY GEOGRAPHICAL REGION

(Euro /000)	31 December2025	31 December2024	Change	%
Italy	47,344	40,994	6,350	15.5%
European Union	2,600	2,676	(76)	-2.8%
Europe non-EU	3,113	2,931	182	6.2%
North America	7,065	8,256	(1,191)	-14.4%
South America	621	649	(28)	-4.3%
Asia	4,236	4,388	(152)	-3.5%
Total	64,979	59,894	5,085	8.5%

13. Goodwill

"Goodwill" totalled 5,918 thousand Euro at 31 December 2025, a decrease of 160 thousand Euro compared with 31 December 2024, as detailed below:

(Euro /000)	31 December 2024	Increases		Decreases Exchange ratedifferences	31 December2025
Gefran France S.A.	1,310	-	-	-	1,310
Gefran Inc.	2,817	-	-	(318)	2,499
Gefran Schweiz AG	1,954	-	-	-	1,954
CZ Elettronica S.r.l.	-	155	-	-	155
Total	6,081	155	-	(318)	5,918

During 2025, the difference in the value of goodwill relating to the US subsidiary Gefran Inc was recognised (a loss of 318 thousand Euro).

Goodwill of 155 thousand Euro, calculated as the difference between the cost for the acquisition of CZ Elettronica S.r.l. (including its subsidiary Mecatronica S.r.l.) and the value of the net assets acquired, was also recognised, as described in note 10 of the Specific explanatory notes to the consolidated

financial statements.

The goodwill acquired on business combinations was allocated to specific Cash Generating Units for impairment testing purposes.

The carrying value of goodwill is analysed below:

(Euro /000)	Year	GoodwillFrance	Goodwill	India Goodwill USA	GoodwillSwitzerland	GoodwillItaly	Total
	2025	1,310	-	2,499	1,954	-	5,763
Sensors	2024	1,310	-	2,817	1,954	-	6,081
Automation	2025	-	-	-	-	155	155
components	2024	-	-	-	-	-	-
	2025	1,310	-	2,499	1,954		155 5,918
Total	2024	1,310	-	2,817	1,954		- 6,081

When determining value in use, Management considers the specific cash flows forecast in the Group's Plan plus the projected and terminal values, which represent the ability to generate cash flows beyond the explicit forecasting horizon.

When examining the possible presence of impairment indicators and developing its own assessments, Management took into account the plans of the companies that carry a goodwill as well as the results of the same and the operating cash flow generated by the Group, confirming the substantial absence of impairment indicators.

396 397

In addition, the relationship between stock market capitalization and the carrying value of the Group's shareholders' equity was also verified, which as of 31 December was largely positive.

As part of the analysis on the recoverability of the values of goodwill, in accordance with the key principles of IAS 36, the values in use in the Group and in the CGU mentioned above, to which the tested assets were allocated, were determined. This exercise was based on the forecast cash flows discounted back, produced by the CGUs subject to analysis, appropriately discounted back by means of the rates which reflect the risk.

Goodwill relating to the French, US and Swiss CGUs was attributed to the sensors business unit, while goodwill relating to the Italian CGU, pertaining to the acquisition of shares in CZ Elettronica S.r.l., was attributed to the automation components business unit. For impairment testing purposes, all goodwill is examined on the basis of data from the specific CGUs, which correspond to the subsidiary companies operating in the aforesaid geographical regions.

The main assumptions used in conducting the impairment tests are set out in the table below:

(Euro /000)	Netinvestedcapitalat 31December2025	Netinvestedcapitalat 31December2024	Explicit	forecast WACC (%)	Value inuse at 31December2025	Riskfree	Riskpremium	Theoreticaltax rate
Gefran	1,310		1,310 2026 - 2028	8.8%	6,033 3.5%		5.5%	25.0%
France S.A.
Gefran Inc.	2,499		2,817 2026 - 2028	9.1%	24,767 4.2%		5.5%	27.0%
GefranSchweiz AG	1,954		1,954 2026 - 2028	6.7%	5,041 0.3%		5.5%	16.3%
CZElettronicaS.r.l.	155		- 2026 - 2028	8.8%	2,036 3.5%		5.5%	27.9%
Total	5,918	6,081

When determining value in use, specific cash flows deriving from the Group Plan for the period 2026 - 2028 were considered, along with terminal value, representing ability to generate cash flows beyond the explicit forecast time horizon.

The main assumptions that Management used to calculate the value in use regard the discount rate (Weighted Average Cost of Capital - WACC) and the long-term growth rate (known as g rate), as well as the cash flows deriving from the Group Plan.

The rate used for discounting future cash flows is the weighted average cost of capital (WACC), as calculated at the end of 2025, determined by the weighted average of the cost of own capital and the cost of third-party capital, net of the effect on taxation.

When calculating the same, market parameters were used such as the "beta" (a factor expressing the risk which characterises the particular business with respect to the financial market in general) and the related financial structure, taken from calculations developed by Professor Damodaran, one of the leading experts in business valuations globally. In addition, an "alpha" coefficient was applied to the cost of own capital to represent a prudent discretionary factor reflecting specific non-systematic risks not already identified by the traditional model.

The return on risk-free assets was benchmarked to the average monthly yield in the last six months of 2025 on government bonds of countries in which the Group and the CGUs operate.

The premium for market risk represents the additional return required by a risk-averse investor, compared with the return that can be obtained from risk-free assets: it is attributable to the difference between the long-term normalised return of the share market and the risk-free assets rate. For this component, the reference used for all CGUs, regardless of the geographical region of reference, was the so-called global value, according to Professor Damodaran's calculations, so as to reduce the volatility of the component from one year to the next.

In order to establish the terminal value, the long-term growth rate of the cash flows adopted has been defined in relation to the expected levels of inflation in the various geographical regions in which the Group operates, referring to estimates of international bodies.

The general change in the WACC at consolidated level between 2025 and 2024 is mainly related to the decrease in the "risk-free" rate and the decrease in the "cost of debt" as well as the change in the "beta" coefficient.

Applying sensitivity analysis to the Group's impairment test, we find that break-even WACC, that is, the discount rate that would make value in use the same as the value of net invested capital, is 16.50%, significantly higher than the current discount rate. Note that in 2024 this rate was 19.58%.

The recoverable amount of goodwill was determined according to the calculation of the value in use, which used projections of the three-year cash flow based on the 2026 - 2028 Plan approved by Management. The cash flows in the Group Plan include application of the IFRS 16 accounting standard, the effects of which are reflected in the WACC applied, as the average ratio between equity and financial debt is influenced by the adoption of this principle.

The impairment test of the above assets did not reveal any lasting loss of value.

Annual Financial Report at 31 december 2025 Gefran Group

Below is a sensitivity analysis showing the break-even "g" and "WACC" rates in a "steady case" situation:

Goodwill - STEADYCASE	"g" rate %	WACC (%)	A	B
Gefran France S.A.	1.9%	8.8%	-40.6%	31.6%
Gefran Inc.	2.2%	9.1%	-31.4%	27.1%
Gefran Schweiz AG	0.8%	6.7%	-2.2%	9.0%
CZ Elettronica S.r.l.	2.0%	8.8%	n.a.	16.1%

A = "g" rate % of break-even point with unchanged WACC B = WACC % of break-even point with unchanged g rate

Since implementation of the Plan implies a number of elements of uncertainty, even if the impairment tests would make it possible to deem both the value of the Group's consolidated figures and the carrying value of the goodwill recorded in the financial statements reasonable, with a good degree of confidence, steps were taken to carry out stress test activities.

The above analyses show that, both under stable conditions and in situations worse than those forecast, the recoverable amount of goodwill is not critical, also considering the change in the discount rate and the growth rate.

However, the Directors systematically monitor final income statement and statement of financial position data of the various CGUs to assess the need to adjust forecasts and promptly reflect any write-downs.

14. Intangible assets

This item comprises solely assets with a finite life. Their carrying amount decreased from 7,249 thousand Euro at 31 December 2024 to 8,142 thousand Euro at 31 December 2025, as analysed below.

Accumulateddepreciation	31December2024			Increases Decreases Reclassifications	Exchangeratedifferences	31December2025
(Euro /000)
Development costs	13,409	1,294	-	-	-	14,703
Intellectual
property rights	8,331	368	(1)	-	(40)	8,658
Other assets	8,788	194	-	-	(12)	8,970
Total	30,528	1,856	(1)	-	(52)	32,331

Net value	31 December 2024	31 December 2025	Change
(Euro /000)
Development costs	2,904	4,628	1,724
Intellectual propertyrights	669	488	(181)
Other assets	801	1,397	596
Assets in progress andpayments on account	2,875	1,629	(1,246)
Total	7,249	8,142	893

The net carrying amount of development costs includes the capitalisation of costs incurred for the following activities:

/ 1,079 thousand Euro for the sensors segment, referring to lines for mobile hydraulics, pressure transducers (KS and KH in miniaturized version), non-contact linear transducers (WP-WR, WPA/WPP I/O LINK, RTE Profinet, TWIIST technology), pressure and melt (KMC, I/O LINK technology);

/ 3,549 thousand Euro referring to the component lines for the new ranges of regulators (850-1650-1850-2850), power control (GRS, GRZ, GRP, GPC, G-Start) and programmable automation (G-Mation, Gilogik3, GF Project).

These assets are estimated to have a useful life of 5 years.

Intellectual property rights comprise the costs incurred to purchase IT system management software and user licences for third-party software, as well as patents. These assets have a useful life of 3 years.

Assets in progress and payments on account include 1,848 thousand Euro in development costs, of which 1,044 thousand Euro which pertain to the automation components business and 804 thousand Euro to the sensors business, the benefits of which will be reflected in the income statement as from next year; therefore, they have not been amortised.

The item other assets mostly includes the costs incurred by the Parent Company Gefran S.p.A., both in the course of previous years as well as in the current one, to implement ERP SAP, Business Intelligence (BW), Customer Relationship Management (CRM) and other management software programmes. These assets have a useful life of 5 years.

Historicalcost	31 December	2024 Increases		Decreases Reclassifications	Exchangeratedifferences	31 December2025
(Euro /000)
Development
costs	16,313	753	-	2,265	-	19,331
Intellectual
property rights	9,000	163	-	25	(42)	9,146
Other assets	9,589	720	-	97	(39)	10,367
Assets in
progress and
payments on	2,875	1,154	(1)	(2,402)	3	1,629
account
Total	37,777	2,790	(1)	(15)	(78)	40,473

Annual Financial Report at 31 december 2025 Gefran Group

The increases in the historical value of "Intangible assets", amounting to 2,790 thousand Euro in 2025, include 2,133 thousand Euro linked to the capitalisation of internal costs (2,031 thousand Euro in 2024).

The table below shows the changes in the year 2024.

Historicalcost	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Development
costs	15,544	64	-	705	-	-	16,313
Intellectual
property rights	8,834	240	(3)	(78)	-	7	9,000
Other assets	8,932	201	-	438	-	18	9,589
Assets in
progress and
payments on	1,567	2,073	-	(764)	-	(1)	2,875
account
Total	34,877	2,578	(3)	301	-	24	37,777

Accumulateddepreciation	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Development
costs	12,264	1,145	-	-	-	-	13,409
Intellectual
property rights	8,031	402	(3)	(107)	-	8	8,331
Other assets	8,163	223	-	395	-	7	8,788
Total	28,458	1,770	(3)	288	-	15	30,528

Net value	31 December 2023	31 December 2024	Change
(Euro /000)
Development costs	3,280	2,904	(376)
Intellectual property rights	803	669	(134)
Other assets	769	801	32
Assets in progress and
payments on account	1,567	2,875	1,308
Total	6,419	7,249	830

15. Property, plant, machinery and tools

Historicalcost	31December2024			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2025
(Euro /000)
Land	3,863	-	-	-	-	(76)	3,787
Industrialbuildings	36,499	509	-	49	-	(730)	36,327
Plant andmachinery	44,014	2,037	(241)	1,371	100	(525)	46,756
Industrial andcommercialequipment	18,018	488	(145)	407	70	(10)	18,828
Other assets	8,103	467	(146)	106	412	(233)	8,709
Assets inprogress andpayments onaccount	1,443	3,097	(12)	(1,918)	-	(3)	2,607
Total	111,940	6,598	(544)	15	582	(1,577)	117,014

Accumulateddepreciation	31December2024			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2025
(Euro /000)
Industrialbuildings	18,993	907	-	-	-	(134)	19,766
Plant andmachinery	32,839	2,557	(201)	-	89	(383)	34,901
Industrial andcommercialequipment	16,311	846	(184)	-	70	(9)	17,034
Other assets	6,199	555	(141)	-	403	(169)	6,847
Total	74,342	4,865	(526)	-	562	(695)	78,548

Net value		31 December 2024 31 December 2025	Change
(Euro /000)
Land	3,863	3,787	(76)
Industrial buildings	17,506	16,561	(945)
Plant and machinery	11,175	11,855	680
Industrial and commercial equipment	1,707	1,794	87
Other assets	1,904	1,862	(42)
Assets in progress and payments on account	1,443	2,607	1,164
Total	37,598	38,466	868

This item increased by 868 thousand Euro, from 37,598 thousand Euro on 31 December 2024 to 38,466 thousand Euro on 31 December 2025. The changes during the year are shown below.

Annual Financial Report at 31 december 2025 Gefran Group

The increases in the historical value of "Property, plant, machinery and tools" in 2025 amounted to 6,598 thousand Euro. The most significant changes relate to:

• / investment of 2,995 thousand Euro in production and laboratory machinery and equipment for the Group's Italian plants and 301 thousand Euro for other Group foreign subsidiaries;
• / adaptation of the industrial buildings and facilities of the Group's Italian factories in the amount of 2,824 thousand Euro, and of those abroad in the amount of 112 thousand Euro;
• / investment in renewal of electronic office machines and IT equipment totalling 365 thousand Euro.

In addition, the increases in the historical cost of 2025 include 92 thousand Euro due to capitalisation of internal costs (117 thousand Euro in 2024).

Exchange rate changes had an overall positive impact of 882 thousand Euro on the item.

It should also be noted that the entry of CZ Elettronica S.r.l. into the Group (in the second quarter of 2025, as described in Significant events in 2025) resulted in an increase in net tangible assets of 20 thousand Euro, as highlighted in the "Change in consolidation scope" column (historical cost of 582 thousand Euro and accumulated depreciation of 562 thousand Euro).

The changes compared to 2024 are shown in the table below.

Historicalcost	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Land	3,824	-	-	-	-	39	3,863
Industrial
buildings	35,919	574	(126)	(133)	-	265	36,499
Plant and
machinery	41,941	1,363	(455)	1,008	-	157	44,014
Industrial and
commercial	17,973	360	(177)	(122)	-	(16)	18,018
equipment
Other assets	7,089	466	(97)	594	-	51	8,103
Assets in
progress and
payments on	2,199	1,022	-	(1,781)	-	3	1,443
account
Total	108,945	3,785	(855)	(434)	-	499	111,940

Accumulateddepreciation	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Industrial
buildings	18,586	938	(126)	(413)	-	8	18,993
Plant and
machinery	30,702	2,647	(452)	(183)	-	125	32,839
Industrial and
commercial	15,885	782	(179)	(172)	-	(5)	16,311
equipment
Other assets	5,387	518	(97)	347	-	44	6,199
Total	70,560	4,885	(854)	(421)	-	172	74,342

Net value	31 December 2023	31 December 2024	Change
(Euro /000)
Land	3,824	3,863	39
Industrial buildings	17,333	17,506	173
Plant and machinery	11,239	11,175	(64)
Industrial and commercial
equipment	2,088	1,707	(381)
Other assets	1,702	1,904	202
Assets in progress and
payments on account	2,199	1,443	(756)
Total	38,385	37,598	(787)

16. Right-of-Use assets

The value of "Right-of-Use assets" at 31 December 2025 amounted to 3,495 thousand Euro, relating to the recognition of the value of the assets covered by lease agreements, in accordance with accounting standard IFRS 16. The changes are shown below.

Historicalcost	31December2024	Increases		Decreases Reclassifications	Exchangeratedifferences	31December2025
(Euro /000)
Real estate	5,314	441	-	-	(140)	5,615
Vehicles	4,313	817	(1,116)	-	(22)	3,992
Officemachines	26	-	-	-	-	26
Machinery andequipment	78	66	-	-	-	144
Total	9,731	1,324	(1,116)	-	(162)	9,777

Accumulateddepreciation	31December2024	Increases		Decreases Reclassifications	Exchangeratedifferences	31December2025
(Euro /000)
Real estate	3,048	598	-	-	(68)	3,578
Vehicles	2,849	766	(979)	-	(21)	2,615
Officemachines	9	5	-	-	-	14
Machinery and
equipment	55	20	-	-	-	75
Total	5,961	1,389	(979)	-	(89)	6,282

Net value	31 December2024	31 December2025	Change
(Euro /000)
Real estate	2,266	2,037	(229)
Vehicles	1,464	1,377	(87)
Office machines	17	12	(5)
Machinery and equipment	23	69	46
Total	3,770	3,495	(275)

As of 1 January 2025, the Group had a total of 162 contracts in place (covered by an initial analysis) for the leasing of vehicles, machinery, industrial equipment and electronic office machinery, as well as for the rental of real estate. Practical expedients allowed by the IASB have been employed, such as excluding contracts with a residual duration of less than 12 months and contracts for assets whose fair value is below the conventional threshold of 5 thousand US dollars (modest unit value). As of 31 December 2025, 168 contracts were outstanding of which, based on their value and duration:

• / 155 contracts fell within the scope of application of IFRS 16;
• / 13 contracts were excluded from the scope of application of the standard (9 for terms of less than 12 months and 4 for fair value considered insignificant).

The historical cost increases recorded in the year include new contracts signed, as well as the effect of the adjustment of contracts already in place and extended or for which new conditions have been defined. They are summarized as follows:

/ properties, for the amount of 441 thousand Euro, mainly relating to the lease agreement for the property housing the operational activities of the newly acquired CZ Elettronica S.r.l. (which joined the Group in April 2025) and the lease agreement for the premises housing the new R&D laboratories of the German branch Gefran Deutschland GmbH (near Stuttgart), as well as the indexation of existing contracts;

/ vehicles, for the amount of 817 thousand Euro, which include both the effect of extensions and 31 new car rental contracts signed by the Group in 2025, part of which replaces expired contracts.

As of 31 December 2025, the historical cost had decreased by 1,116 thousand Euro, only in part related to termination of vehicle rental agreements in advance of their original expiry date, for which a capital loss of 10 thousand Euro was recorded. This item also includes the write-off of vehicle rental agreements that expired before 31 December 2024, with zero carrying value, leading to a decrease in the historical cost and, in equal measure, the related depreciation provision.

The changes compared to 2024 are shown in the table below:

Historicalcost	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Real estate	4,832	462	-	-	-	20	5,314
Vehicles	3,712	959	(310)	-	-	(48)	4,313
Officemachines	26	-	-	-	-	-	26
Machinery andequipment	57	21	-	-	-	-	78
Total	8,627	1,442	(310)	-	-	(28)	9,731

Accumulateddepreciation	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
(Euro /000)
Real estate	2,467	569	-	-	-	12	3,048
Vehicles	2,396	692	(210)	-	-	(29)	2,849
Officemachines	4	5	-	-	-	-	9
Machinery andequipment	45	10	-	-	-	-	55
Total	4,912	1,276	(210)	-	-	(17)	5,961

Net value	31 December 2023	31 December 2024	Change
(Euro /000)
Real estate	2,365	2,266	(99)
Vehicles	1,316	1,464	148
Office machines	22	17	(5)
Machinery and equipment	12	23	11
Total	3,715	3,770	55

17. Shareholdings valued at equity

(Euro /000)		31 December2025	31 December2024	Change
Axel S.r.l.	Shareholding	15.00%	15.00%
Via del Cannino, 3	Investment value	137	137	-
Crosio della Valle (VA)	Adjustment provision	63	51	12
	Net value	200	188	12
Robot At Work S.r.l.	Shareholding	24.83%	24.83%
Via Primo Maggio, 40/E Investment value		576	576	-
Rovato (BS)	Adjustment provision	-	-	-
	Net value	576	576	-
40Factory S.r.l.	Shareholding	22.00%	0.00%
Via Vittore Calligari, 21 Investment value		4,000	-	4,000
Piacenza (PC)	Adjustment provision	-	-	-
	Net value	4,000	-	4,000
Total		4,776	764	4,012

It should be noted that, in relation to the shareholding in Robot At Work S.r.l. (acquired in 2023 for a value of 576 thousand Euro as consideration for 24.83% of the company), just like the shareholding in 40Factory S.r.l. (acquired in the first quarter of 2025 for a value of 4,000 Euro representing 22% of the share capital), the carrying amount is higher than the portion of shareholders' equity, since implicit goodwill arose for both companies at the time of their acquisition.

The change in the adjustment provision for the shareholding in Axel S.r.l. is exclusively due to the company's economic results.

18. Equity investments in other companies

The value of "Equity investments in other companies" totalled 1,785 thousand Euro, a decrease of 25 thousand Euro compared with the figure at 31 December 2024. The change mainly relates to the adjustment to the value of the shareholding in Woojin Plaimm Co Ltd (negative for 32 thousand Euro) and the acquisition of a shareholding in the Intellimech consortium by Gefran S.p.A. (7 thousand Euro).

The equity investment in Woojin Machinery Co Ltd is classified as available for sale and entered at fair value, derived from the stock market quotation for the Korean company (Seoul Stock Exchange).

The shareholdings in Colombera S.p.A. and those listed under the item "Others" are entered at cost, as specified in note 11, "Financial instruments: additional information provided under IFRS 7".

The balance of this item breaks down as follows:

Euro /000)

COIOTIDELA S.P.A.
Woojin Plaimm Co Ltd
Other

(Euro /000)	Shareholding	31 December2025	31 December2024	Change
Colombera S.p.A.	17.08%	1,582	1,582	-
Woojin Plaimm Co Ltd	2.00%	159	159	-
Other	-	34	27	7
Adjustment provision	-	10	42	(32)
Total		1,785	1,810	(25)

The adjustment provision, down by 32 thousand Euro compared to the previous year's balance, is attributable to fair value adjustments and is broken

down as follows:

(Euro /000)	Shareholding	31 December2025	31 December2024	Change
Woojin Plaimm Co Ltd	2.00%	10	42	(32)
Total		10	42	(32)

19. Receivables and other noncurrent assets

"Receivables and other non-current assets" represent guarantee deposits paid by Group companies, and present a balance of 88 thousand Euro.

(Euro /000)	31 December2025	31 December2024	Change
Guarantee deposits	88	88	-
Total	88	88	-

Annual Financial Report at 31 december 2025 Gefran Group

20. Net working capital

"Net Working Capital" totalled 19,627 thousand Euro, compared with 20,216 thousand Euro as at 31 December 2024, and is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Inventories	15,182	15,747	(565)
Trade receivables	26,016	23,264	2,752
Trade payables	(21,571)	(18,795)	(2,776)
Net amount	19,627	20,216	(589)

It should be noted that the entry of CZ Elettronica S.r.l. into the Group (in the second quarter of 2025, as described in Significant events in 2025) resulted in an increase in working capital at 31 December 2025 of a total of 1,060 thousand Euro (consisting of: inventories of 443 thousand Euro, trade receivables of 938 thousand Euro and trade payables of 321 thousand Euro).

The value of inventories at 31 December 2025 was 15,182 thousand Euro, a decrease of 565 thousand Euro compared with 31 December 2024 (without considering the effect of the corporate acquisition in 2025, the decrease would be 1,008 thousand Euro).

The change in exchange rates contributed to the decrease by 53 thousand Euro.

The overall economic impact of the change in inventories, on the other hand, saw a more marked decrease compared to 31 December 2024 of 883 thousand Euro, since the economic recognition of events is made using the average progressive exchange rate for the year.

The balance is analysed as follows:

31 December	31 December	Change
		(908)
		19
		218
		(56)
		(380)
		542
15,182	15,747	(565)
	20257,959(1,299)5,952(523)3,888(795)	20248,867(1,318)5,734(467)4,268(1,337)

The gross value of inventories totalled 17,799 thousand Euro, down 1,070 thousand Euro compared to the end of 2024, when it amounted to 18,869 thousand Euro.

The provision for obsolete and slow-moving inventories was adjusted as necessary during 2025, through specific provisions totalling 1,647 thousand Euro (compared with 1,727 thousand Euro in 2024), while releases for surplus were recognised in the amount of 68 thousand Euro (releases of 21 thousand Euro in 2024). The changes in the provision in 2025 and in 2024 are shown below.

(Euro /000)	31December2024	Provisions		Uses Releases	Exchangeratedifferences	31December2025
Provision for impairmentof inventory	3,122		1,647 (2,016)	(68)	(68)	2,617

Provision for impairment

(Euro /000)	31December2023	Provisions		Uses Releases	Exchangeratedifferences	31December2024
Provision for impairmentof inventory	4,427		1,727 (3,013)	(21)	2	3,122

Trade receivables amounted to 26,016 thousand Euro, compared with 23,264 thousand Euro on 31 December 2024, an increase of 2,752 thousand Euro (1.814 thousand Euro when excluding the increase related to the entries of the newly acquired subsidiary CZ Elettronica S.r.l.).

(Euro /000)	31 December2025	31 December2024	Change
Receivables from customers	27,051	24,160	2,891
Provision for doubtful receivables	(1,035)	(896)	(139)
Net amount	26,016	23,264	2,752

The increase compared to the end of the previous year is consistent with the slight increase in the number of average days for collection compared to the average of 2024, as well as with the level of revenues generated in the third and fourth quarters of 2025, an increase compared to the last two quarters of the previous year.

Annual Financial Report at 31 december 2025 Gefran Group

Receivables are adjusted to their estimated realisable value by the allowance for doubtful accounts, which is determined by analysing individual debtor positions and considering past experience in each business area and geographical region, as required by IFRS 9. The provision as at 31 December 2025 represents an estimate of the current risk. The changes in the provision in 2025 and in 2024 are shown below.

(Euro /000)	31December2024	Provisions	Uses	Releases	Exchangeratedifferences	31December2025
Provisionfor doubtfulreceivables	896	167	(10)	(11)	(7)	1,035
(Euro /000)	31December2023	Provisions	Uses	Releases	Exchangeratedifferences	31December2024
Provisionfor doubtfulreceivables	1,035	29	(106)	(46)	(16)	896

The value of uses of the provision includes the coverage of losses on receivables that are no longer recoverable. The Group monitors the receivables most at risk and also initiates appropriate legal action. The carrying value of trade receivables is deemed to approximate their fair value.

In addition, there is no significant concentration of sales to individual customers: this phenomenon involves less than 5% of Group revenues.

Trade payables totalled 21,571 thousand Euro, compared to 18,795 thousand Euro as at 31 December 2024. This item is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Payables to suppliers	18,397	16,740	1,657
Payables to suppliers for invoices to be received	3,174	2,055	1,119
Total	21,571	18,795	2,776

Trade payables increased by 2,776 thousand Euro compared to 31 December 2024 (2,455 thousand Euro net of the entries of the newly acquired CZ Elettronica S.r.l.).

21. Other receivables and assets

"Other receivables and assets" amounted to 3,526 thousand Euro, as compared to 3,831 thousand Euro on 31 December 2024. The item breaks down

as follows:

(Euro /000)	31 December2025	31 December2024	Change
Insurance fees	2	2	-
Rents and leasing fees	13	3	10
Services and maintenance fees	687	578	109
Receivables from employees	29	20	9
Advance payments to suppliers	560	262	298
Other tax receivables	866	1,037	(171)
Other current financial investments	3	230	(227)
Other	1,366	1,699	(333)
Total	3,526	3,831	(305)

The item "Other tax receivables", amounting to Euro 866 thousand at 31 December 2025 and down by Euro 171 thousand compared to the previous year, relates to VAT receivables.

The item "Other", amounting to 1,366 thousand Euro at 31 December 2025 includes, among other things, R&D tax receivables and tax credits for oper-

ating assets.

The carrying value of other current assets is believed to approximate their

fair value.

22. Current tax receivables and payables

Current tax receivables as at 31 December 2025 amounted to 697 thousand Euro, up from 328 thousand Euro at 31 December 2024 (an increase of 308 thousand Euro without considering the entries of the newly acquired CZ Elettronica S.r.l.). The balance breaks down as follows:

(Euro /000)	31 December2025	31 December2024	Change
IRES (corporate income tax)	83	16	67
IRAP (regional production tax)	16	16	-
Foreign tax receivables	598	296	302
Total	697	328	369

The balance of "Current tax payables" as of 31 December 2025 amounted to 1,025 thousand Euro, 121 thousand Euro lower than the 31 December 2024 balance amounting to 1,146 thousand Euro. The item breaks down as follows:

(Euro /000)	31 December2025	31 December2024	Change
IRES (corporate income tax)	742	103	639
IRAP (regional production tax)	144	15	129
Foreign tax payables	139	1,028	(889)
Total	1,025	1,146	(121)

23. Net financial position

The net financial position is analysed in the following table.

(Euro /000)	31 December2025	31 December2024	Change
Cash and cash equivalents and current financialreceivables	53,140	59,629	(6,489)
Financial assets for derivatives	5	34	(29)
Other non-current financial investments	102	104	(2)
Non-current financial payables	(11,697)	(16,269)	4,572
Non-current financial payables for IFRS 16 leases	(2,379)	(2,664)	285
Current financial payables	(4,921)	(5,173)	252
Current financial payables for IFRS 16 leases	(1,230)	(1,195)	(35)
Financial liabilities for derivatives	(178)	(311)	133
Total	32,842	34,155	(1,313)

The net financial position at the end of 2025 was positive by 32,842 thousand Euro, down by 1,313 thousand Euro since the end of 2024, when it was overall positive by 34,155 thousand Euro.

The decrease in the net financial position is essentially due to the positive cashflow generated by ordinary operations (23,267 thousand Euro), as partly absorbed by the disbursements for technical investments made during the year (9,388 million Euro) and for the operations described in the introduction to the section and in Significant events in 2025 relating to the acquisition of a stake in 40Factory S.r.l., equal to 22% of its share capital (4,000 thousand Euro), and a majority stake equal to 60% in CZ Elettronica S.r.l., recognised among the subsidiaries of Gefran S.p.A. (739 thousand Euro, net of acquired cash). The payment of dividends on the 2024 results in the second quarter of 2025 (6,107 thousand Euro), as well as taxes and rental fees (totalling 3,793 thousand Euro), contributed to the decrease in financial resources. In addition, the change in the Group's available financial position as at 31 December 2025 includes the negative effect of the exchange rate difference for foreign currencies compared with the previous year (estimated overall at 1,044 thousand Euro).

The balance of cash and cash equivalents amounted to 53,140 thousand Euro as of 31 December 2025, as compared to 59,629 thousand Euro on 31 December 2024. This item is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Cash in bank deposits	53,125	59,615	(6,490)
Cash	15	14	1
Total	53,140	59,629	(6,489)

The technical forms used as at 31 December 2025 are shown below:

/ maturities: collectible on demand;

/ counterparty risk: deposits are made with leading banks;

/ Country risk: deposits are made in the countries in which Group companies have their registered offices.

In order to support its current assets, the Group has various credit lines available from banks and other financial institutions, mainly in the form of advances against invoices, cash flexibility and mixed credit lines totalling 26,650 thousand Euro. As of 31 December 2025 there is no use of these lines, so the remaining liquid assets are equal to the total amount granted. No fees are due if these lines are not used.

Current financial payables at 31 December 2025 decreased by 252 thousand Euro from the end of 2024; the balance is analysed as follows:

(Euro /000)	31 December2025	31 December2024	Change
Current portion of debt	4,872	5,112	(240)
Current overdrafts	4	1	3
Other payables	45	60	(15)
Total	4,921	5,173	(252)

Annual Financial Report at 31 december 2025 Gefran Group

Non-current financial payables are analysed as follows:

Bank(Euro /000)	31 December2025	31 December2024	Change
Intesa (ex UBI)	-	755	(755)
SIMEST	120	240	(120)
Crédit Agricole	6,208	8,461	(2,253)
BNL	4,996	6,660	(1,664)
SIMEST	297	-	297
SIMEST	76	153	(77)
Total	11,697	16,269	(4,572)

The loans listed in the table are all variable rate contracts with the following characteristics:

Management considers that the credit lines currently available, together with the cash flow generated by operations, will enable Gefran to meet its financial requirements resulting from investing activities, working capital management and the repayment of debt at its natural maturity.

In the fiscal year 2025, Gefran S.p.A. applied to the Simest call for the digital transition, for a total value of 1,290 thousand Euro, which provides for the granting of a 10% non-repayable grant and a 90% subsidised loan. As of 31 December 2025, a total of 322 thousand Euro had been received, including the disbursement of the quotas 27 from the available resources of the revolving fund and co-financing, to be used for investments (aimed at digital innovation and/or ecological transition), as well as for the strengthening of the Company's capital, benefiting competitiveness in international markets. This resulted in the recognition of grants totalling 25 thousand Euro and non-current financial payables totalling 297 thousand Euro. The loan will be repaid in 8 half-yearly instalments, each of the same amount, starting from the end of the pre-amortisation period (lasting 2 years from 30 April 2026). The aid, pursuant to the EU de minimis Regulation, is therefore 231 thousand Euro, once 100% of the financing and co-financing has been reached.

No new funding was subscribed during 2025 in addition to the above.

It should also be noted that the loan with Crédit Agricole requires compliance with a financial parameter (covenant), calculated at the consolidated level, and in particular the ratio of net financial debt (NFP) to EBITDA < 3.25x. Failure to comply with the ratio might result in the lending institution being entitled to demand repayment. The verification of contractual constraints is updated on a quarterly basis by the Administration, Finance and Control Director and, specifically, the ratio as at 31 December 2025 is largely respected. The loan, therefore, is represented according to the forms originally provided for in the contract.

With the exception of the contract described above, none of the loans outstanding at 31 December 2025 contains clauses requiring compliance with economic and financial requirements (covenants).

Variable rate payables expose the Group to a risk arising from interest rate volatility. In this regard, the Group's Administration and Finance Department monitors the exposure to interest rate risk and proposes appropriate hedging strategies to contain the exposure within the limits defined and agreed in the Group's policies, using derivatives, Interest Rate Swaps (IRS) and Interest Rate Caps (CAP) when necessary.

27 Provided for by the Decree of 1 June 2023 of the Minister of Foreign Affairs and International Cooperation, in

Bank(Euro /000)	Amountdisbursed	Signingdate	Balanceat 31December2025	Of whichwithin 12months	Of whichbeyond 12months	Interest		rate Maturity Repaymentmethod
enteredinto byGefranS.p.A. (IT)
Intesa (exUBI)	3,000	24Jul 20	755	755		- Euribor 6m		+ 1% 24Jul 26 half-yearly
SIMEST	480	9Jul 21	240	120	120	Fixed		0.32% 31Dec 27 half-yearly
CréditAgricole		13,000 29Sep 23	8,461	2,253		6,208 Euribor 3m	+ 0.88% 28Sep 29	quarterly
BNL	10,000	27Oct 23	6,660	1,664		4,996 Euribor 3m	+ 0.93% 27Oct 29	quarterly
SIMEST	297	31Oct 25	297	-	297	Fixed		0.32% 31Oct 31 half-yearly
enteredinto byGefranSoluzioniS.r.l. (IT)
SIMEST	307	21May 21	153	77	76	Fixed		0.32% 31Dec 27 half-yearly
enteredinto by CZElettronicaS.r.l. (IT)
CréditAgricole	25	6Jun 22	3	3	-	Fixed1.10%	5Jun 26	monthly
Total			16,569	4,872	11,697

agreement with the Ministers of Enterprise and Made in Italy, of Economy and Finance, containing "Regulation of financial instruments in support of the internationalization of companies, from the Revolving Fund 394/81" ("Decree").

All derivatives outstanding at 31 December 2025 are stipulated by the Parent Company to hedge the interest rate risk on variable rate loans, which might occur in the event of a change in the Euribor. As of 31 December 2025, no derivatives have been taken out to hedge exchange rate risk.

All derivatives were tested for effectiveness as at 31 December 2025, with positive results.

Financial assets for derivatives amounted to 5 thousand Euro (34 thousand Euro as at 31 December 2024), while liabilities for derivatives amounted to 178 thousand Euro (311 thousand Euro at 31 December 2024), due to the fair value of the individual contracts.

		as at 31 December 2024
Positive fairvalue	Negative fairvalue	Positive fairvalue	Negative fairvalue
5	(178)	34	(311)(311)
	5	as at 31 December 2025(178)	34

The following details are provided on hedges, showing the related fair value, positive and negative respectively.

Bank(Euro/000)	Notionalprincipal	Signing	date Maturity	Notionalas at 31December2025	Derivative	Fair Valueas at 31December2025	Longpositionrate	Short positionrate
Intesa (exUBI)		3,000 24Jul 20 24Jul 26		755	IRS	5	Fixed-0.115%	Euribor 3m
derivatives –Interest rate risk	Total financial assets for					5

Bank(Euro/000)	Notionalprincipal	Signing	date Maturity	Notionalas at 31December2025	Derivative	Fair Valueas at 31December2025	Longpositionrate	Short positionrate
BNL		10,000 29Jan 24 27Oct 29		6,660	IRS	(92)	Fixed2,94%	Euribor 3m(Floor: 1.00%)
CréditAgricole		13,000 12Jan 24 28Sep 29		8,461	IRS	(86)	Fixed2,75%	Euribor 3m
	Total financial liabilities for
derivatives –Interest rate risk						(178)

The balance of financial payables for leases (current and non-current) under IFRS 16 at 31 December 2025 amounted to 3,609 thousand Euro and complies with IFRS 16, applied by the Group since 1 January 2019, which requires the recording of financial payables corresponding to the value of the right-of-use assets recorded under non-current assets. Financial payables for leases under IFRS 16 are classified on the basis of their maturity as either current payables (due within one year), amounting to 1,230 thousand Euro, or non-current payables (due beyond one year), amounting to 2,379 thousand Euro.

Changes in this item in the year 2025 and in the year 2024 are detailed below.

(Euro /000)	31December2024			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2025
Leasingpayablesunder	3,859	1,439	(1,607)	-	-	(82)	3,609
IFRS 16Total	3,859	1,439	(1,607)	-	-	(82)	3,609

(Euro /000)	31December2023			Increases Decreases Reclassifications	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
LeasingpayablesunderIFRS 16	3,779	1,494	(1,406)	-		(8)	3,859
Total	3,779	1,494	(1,406)	-	-	(8)	3,859

Lastly, a breakdown of financial debt, as per Esma and Consob regulations, is set out below.

(Euro /000)	31 December2025	31 December2024	Change
A. Cash	53,140	59,629	(6,489)
B. Cash equivalents	-	-	-
C. Other current financial assets	-	-	-
D. Cash and cash equivalents ( A ) + ( B ) + ( C )	53,140	59,629	(6,489)
Current financial liabilities for derivatives	-	-	-
Current financial debts	(1,279)	(1,256)	(23)
E. Current financial payables	(1,279)	(1,256)	(23)
F. Current portion of long-term debt	(4,872)	(5,112)	240
G. Total current financial debts (E) + (F)	(6,151)	(6,368)	217
H. Net current financial debt (I) + (D)	46,989	53,261	(6,272)
I. Non-current financial debt	(14,076)	(18,933)	4,857
Non-current financial liabilities for derivatives	(178)	(311)	133
J. Financial debt instruments	(178)	(311)	133
K. Trade payables and Other non-current financialdebts	-	-	-
L. Non-current financial debt (I) + (J) + (K)	(14,254)	(19,244)	4,990
M. Total financial debt (H) + (L)	32,735	34,017	(1,282)
of which to minorities:	32,735	34,017	(1,282)

24. Shareholders' equity

Consolidated shareholders' equity is analysed as follows:

(Euro /000)	31 December2025	31 December2024	Change
Portion pertaining to the Group	100,829	99,338	1,491
Portion pertaining to minority interests	-	-	-
Shareholders' equity	100,829	99,338	1,491

The Group's portion of Shareholders' Equity at 31 December 2025 was 100,829 thousand Euro, up by 1,491 thousand Euro over the figure for 31 December 2024.

The change is essentially related to the positive result for the year (9,869 thousand Euro), reduced by the change in the translation reserve (negative by 2,318 thousand Euro) and by the payment of dividends on the 2024 profit (6,107 thousand Euro).

Finally, at 31 December 2025 the minority portion of shareholders' equity, amounting to 479 thousand Euro, was fully attributable to the Gefran Group by virtue of the purchase option entered into in the agreement with the sellers and linked to the remaining 40% of the Company's shares. This option was exercised on 23 February 2026, as described in paragraph Significant events after the end of 2025.

Share capital amounts to 14,400 thousand Euro, represented by 14,400,000 ordinary shares with a nominal value of 1 Euro each.

As at 31 December 2024, Gefran S.p.A. held 198,405 own shares, equal to 1.38% of the total, with an average book value of 8.6483 Euro per share and a total value of 1,716 thousand Euro. During 2025, as at the date of this publication, no trading activities took place; therefore, the situation is unchanged with respect to what is described above.

The Company has not issued any convertible bonds.

See the "Statement of changes in shareholders' equity" for an overview of shareholders' equity reserves and of their changes during the period.

The changes in the "Reserve for the measurement of securities at fair value" and the reserve for the measurement of derivatives at fair value are shown below.

(Euro /000)	31 December2025	31 December2024	Change
Balance at 1 January	42	157	(115)
Woojin Plaimm Co Ltd Shares	(32)	(116)	84
Tax effect	-	1	(1)
Net amount	10	42	(32)

(Euro /000)	31 December2025	31 December2024	Change
Balance at 1 January	(210)	141	(351)
Change in fair value derivatives	104	(462)	566
Tax effect	(25)	111	(136)
Net amount	(131)	(210)	79

The results achieved by the Group in the fiscal year 2025 are in line with expectations, both in terms of revenues and cash flows generated. Based on this, also assessing the capitalisation value, no indicators of impairment were found in the consolidated financial statements.

(Euro /000)	Netinvestedcapitalat 31December2025	Netinvestedcapitalat 31December2024	Explicitforecast	WACC(%)	Value inuse at 31December2025	Risk free	Riskpremium	Theoreticaltax rate
Groupconsolidated	67,987	65,183	2026- 2028	8.9%	175,731	3.7%	5.5%	27.7%

In consideration of the result for the year, in its 12 March 2026 meeting, the Board of Directors proposed, subject to approval of the Shareholders' Meeting, in view of the annual profit of the year 2025, to pay a dividend of 0.43 Euro per unrestricted share.

25. Earnings per share

Basic and diluted earnings per share are shown in the table below:

	31 December 2025	31 December 2024
Basic earnings per share
- Profit (loss) for the period pertainingto the Group (Euro/000)	9,869	11,142
- Average No. of ordinary shares(No./000,000)	14.202	14.202
- Basic earnings per ordinary share	0.695	0.785
Diluted earnings per share
- Profit (loss) for the period pertainingto the Group (Euro/000)	9,869	11,142
- Average No. of ordinary shares(No./000,000)	14.202	14.202
- Basic earnings per ordinary share	0.695	0.785
Average number of ordinary shares	14,201,595	14,201,595

	31 December 2025	31 December 2024
Basic earnings per share
- Profit (loss) for the period pertainingto the Group (Euro/000)	9,869	11,142
- Average No. of ordinary shares(No./000,000)	14.202	14.202
- Basic earnings per ordinary share	0.695	0.785
Diluted earnings per share
- Profit (loss) for the period pertainingto the Group (Euro/000)	9,869	11,142
- Average No. of ordinary shares(No./000,000)	14.202	14.202
- Basic earnings per ordinary share	0.695	0.785
Average number of ordinary shares	14,201,595	14,201,595

Reconciliation of the profit of the Parent Company Gefran S.p.A. and the portion of this profit pertaining to the Group for calculating "Earnings per share" is discussed in the paragraph Gefran consolidated results of the Report on Operations included in this Annual financial report.

26. Employee benefits

The liabilities for "Employee benefits" increased by 77 thousand Euro compared to the balance at 31 December 2024, showing the following changes in

2024 and 2025:

(Euro /000)	31December2024		Increases Decreases Discounting		Change inscope ofconsolidation	Exchangeratedifferences	31December2025
Terminationbenefits	2,058	117	(317)	(59)	362	(11)	2,150
Noncompetitionagreements	73	-	(12)	(3)	-	-	58
Total	2,131	117	(329)	(62)	362	(11)	2,208

(Euro /000)	31December2024			Increases Decreases Discounting	Change inscope ofconsolidation	Exchangeratedifferences	31December2024
Terminationbenefits	2,103	103	(170)	19	-	3	2,058
Noncompetitionagreements	-	65	(7)	15	-	-	73
Total	2,103	168	(177)	34	-	3	2,131

In greater detail, the technical bases used are:

Demographic assumptions	2025	2024
Probability of death	ISTAT 2014 Mortality tables	ISTAT 2014 Mortality tables
	INPS tables divided by age and	INPS tables divided by age and
Probability of inability	gender	gender
	100% upon reaching AGO	100% upon reaching AGO
Probability of retirement	requirements	requirements

Hypothetical turnover and

Hypothetical turnover andadvances	2025	2024
Frequency of advances:	2.1%	2.1%
Frequency of resignation	2% up to age 50	2% up to age 50
	0% after 50	0% after 50

Financial assumptions	2025	2024
Discount rate	3.96%	3.38%
Annual inflation rate	2%	2%
Annual rate of increase of postemployment benefit	3%	3%

This is the method applied to the assessment of Non-Competition Agreements, and the technical bases used:

/ projection, for each employee as of the measurement date, of non-competition agreements already set aside and future quotas of non-competition agreements which will be accrued up to the date of payment;

/ determination, for each employee, of probabilised payment of the non-competition agreement covenant that would have to be paid by the company in the event that the employee should be dismissed or retire;

/ discounting of each probabilised payment as of the measurement date.

Demographic assumptions	2025	2024
	RG48 mortality tables published by	RG48 mortality tables published by
Probability of death	General State Accounting Department	General State Accounting Department
Probability of retirement		100% upon reaching AGO requirements 100% upon reaching AGO requirements
Probability of voluntary resignation of	4.00% up to age 50	4.00% up to age 50
Managers and Middle Managers	0.50% after age 50	0.50% after age 50

Financial assumptions	2025	2024
Annual nominal pay increase	2.7%	2.7%
Annual time-discount rate	2.79%	2.77%

This item consists of the so-called Post-employment benefit reserve recognised for the Group's employees (2,150 thousand Euro at 31 December 2025), in addition to the recognition of residual payables to employees for the signing of agreements that protect the Company from competitive activities, the so-called Non-Competition Agreements (58 thousand Euro at the end of 2025).

The change in the year is the result of a 117 thousand Euro increase, of 329 thousand Euro in payments to employees, and of discounting of the payable in existence as of 31 December 2024 under IFRS standards, negative by 62 thousand Euro, based on the assessment of demographic assumptions and experience (a negative impact of 127 thousand Euro) and changes to financial assumptions (a positive impact of 65 thousand Euro). The change in consolidation scope, due to the acquisition of CZ Elettronica S.r.l., led to an increase in the item of 362 thousand Euro.

Pursuant to IAS 19, the post-employment benefit reserve and the non-competition agreement were measured using the "benefits accrued" method on the basis of the "Projected Unit Credit"(PUC) criterion.

The post-employment benefit reserve valuation breaks down as follows:

• / projection until the time of payment of the post-employment benefit already accrued at the option date and revalued as of the valuation date, for each employee;
• / projection, for each person employed as of the measurement date, of the post-employment benefit already accrued and future quotas of the post-employment benefit that will be accrued from 30.06.2018 up to the date of payment, projecting the worker's pay; in particular, it should be noted that in this case the Service Cost for the period between the option date and 30.06.2018 will be null;
• / determination, for each employee, of probabilised payment of the above post-employment benefit which must be made by the company if the employee leaves the company due to dismissal, resignation, inability, death, or retirement, or in response to requests for advance payment;
• / discounting of each probabilised payment as of the assessment date;
• / re-proportioning of services for each employee, probabilised and discounted on the basis of seniority accrued as of the measurement date, as compared to the corresponding total as of the payment date.

The discount rate used to determine the present value of the obligation was drawn, in accordance with paragraph 83 of IAS 19, from the Iboxx Corporate AA index with 10+ duration at the measurement date. To this end, a yield with a duration comparable to that of the collective group of workers under assessment was chosen.

The annual rate of increase in post-employment benefits, as provided for in Article 2120 of the Italian Civil Code, is 75% of inflation plus 1.5 percentage points.

The sensitivity analysis carried out on the assumptions of 1% and 0.5% changes in the discount rate used is shown below:

(Euro /000)	31 December 2025			31 December 2024
	-1.0%	1.0%	-1.0%	1.0%
Post-employment benefit reserve	(148)	209	(197)	169
Non-competition agreements	(1)	1	(2)	2
Total	(149)	210	(199)	171

(Euro /000)	31 December 2025			31 December 2024
	-0.5%	0.5%	-0.5%	0.5%
Post-employment benefit reserve	(48)	130	(95)	88
Non-competition agreements	(1)	1	(1)	1
Total	(49)	131	(96)	89

(Euro /000)	31December2024	Provisions			Uses Releases Change in scopeof consolidation	Exchangeratedifferences	31December2025
	Gefran S.p.A. risk provisions
- otherprovisions	-	50	-	-	-	-	50
provisions	Gefran Automation Technology risk
- forrestructuring	-	3	(3)	-	-	-	-
	Gefran Brasil risk provisions
- forrestructuring	-	-	(13)	13	-	-	-
- otherprovisions	41	-	-	(42)	-	1	-
	Elettropiemme S.r.l. risk provisions
- otherprovisions	422	-	(9)	-	-	-	413
Total	463	53	(25)	(29)	-	1	463

During 2025, provisions for risks were recorded in Gefran S.p.A. following an ongoing dispute with a former employee of the Company.

The uses recorded in 2025 relate to conclusion of a dispute involving the subsidiary Elettropiemme S.r.l. (9 thousand Euro) and restructuring costs in the Chinese and Brazilian subsidiaries (16 thousand Euro in total). At the close of 2025, the portion of the provision exceeding the amount needed (29 thousand Euro) was released.

"Current provisions" totalled 693 thousand Euro at 31 December 2025, down by 109 thousand Euro compared with 31 December 2024, and break down as follows:

27. Current and non-current provisions

The value of "Non-current provisions", which include provisions for outstanding legal disputes and miscellaneous risks, was 463 thousand Euro as at 31 December 2025. Changes in provisions during the year are analysed below.

(Euro /000)	31December2024	Provisions			Uses Releases Change in scopeof consolidation	Exchangeratedifferences	31December2025
FISC	29	2	-	-	-	-	31
Product	773	349	(250)	(209)	-	(1)	662
warranty
Total	802	351	(250)	(209)	-	(1)	693

The change relates to the item "Product warranty", relating to the charges for repairs on products under warranty in the Parent Company Gefran S.p.A. and in the production subsidiaries; during 2025 provisions were recorded for 349 thousand Euro against uses for 250 thousand Euro and surplus releases for a total of 209 thousand Euro. As of 31 December 2025, provisions have been verified as meeting needs, with a positive outcome. The "FISC" item mainly includes contractual treatments existing at the Parent Company Gefran S.p.A.

Annual Financial Report at 31 december 2025 Gefran Group

28. Other payables and liabilities

"Other payables and liabilities" at 31 December 2025 amounted to 15,361 thousand Euro, as compared to 13,473 thousand Euro on 31 December 2024. This item is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Payables to personnel	7,164	6,177	987
Social security payables	3,104	2,816	288
Accrued interest on loans	45	60	(15)
Payables to directors and statutory auditors	306	133	173
Other accruals	1,597	1,784	(187)
Other payables for taxes	1,827	1,833	(6)
Other current liabilities	1,318	670	648
Total	15,361	13,473	1,888

The change mainly relates to the increase in payables to employees and social security institutions, as well as other current liabilities, which include the payables recognised following the exercise of the option to purchase the minority stake in CZ Elettronica for 580 thousand Euro.

29. Revenues from product sales

"Revenues from product sales" during the period ending 31 December 2025 amounted to 137,711 thousand Euro, up 4.7% compared with those reported at 31 December 2024, when they amounted to 131,350 thousand Euro. The acquisition of CZ Elettronica S.r.l. (which took place in April 2025) contributed to the increase in revenues, without which the increase over 2024 would be 3.5%.

Revenues from sales and services are analysed by business area in the following table.

(Euro /000)	31 December2025	31 December2024	Change	%
Sensors	89,824	83,673	6,151	7.4%
Automation components	47,887	47,857	30	0.1%
Total	137,711	131,530	6,181	4.7%

Total revenues include revenues from services of 2,765 thousand Euro (2,025 thousand Euro as at 31 December 2024); see the section on Gefran consolidated results for information about the performance of the various business areas and geographical regions.

30. Other revenues and income

"Other operating revenues and income" amounted to 1,253 thousand Euro, compared to 1,077 thousand Euro related to the year 2024, as shown in the

table below:

(Euro /000)	31 December2025	31 December2024	Change	%
Recovery of company canteenexpenses	25	24	1	4.2%
Insurance reimbursements	7	-	7	n.s.
Rental income	-	47	(47)	-100.0%
Fees	27	-	27	n.s.
Government grants	43	5	38	760.0%
Other income	1,151	1,001	150	15.0%
Total	1,253	1,077	176	16.3%

The item "Other income" amounted to 1,151 thousand Euro, up by 150 thousand Euro compared to the figure recorded at 31 December 2024. It includes, among others, the chargebacks for R&D specifically requested by customers, as well as the recognition of tax credits for investing in R&D, assets, Industry 4.0 and the Digital Academy (in 2025 they were equal to 602 thousand Euro, while they amounted to 620 thousand Euro in the previous year). In 2025, the granting of AWS (Amazon Web Service) incentives amounting to 196 thousand Euro was also recorded.

The item "Government grants" amounting to 43 thousand Euro, up by 38 thousand Euro on the figure of 2024, includes, inter alia, grants for the installation of electric vehicle charging stations (investment made in the Parent Company Gefran S.p.A. in 2024) as well as the advance of the non-repayable grant relating to the Simest tender, as described above.

Lastly, it should be noted that, as at 31 December 2024, rental income of 47 thousand Euro was included, relating to contracts concluded in the first quarter of 2024.

31. Costs of raw materials and accessories

The costs of raw materials and accessories amounted to 40,832 thousand Euro, compared with 37,371 thousand Euro related to the year 2024. The change is shown below:

(Euro /000)	31 December2025	31 December2024	Change
Raw materials and accessories	40,832	37,371	3,461
Total	40,832	37,371	3,461

The change posted, corresponding to an increase of 3,461 thousand Euro (3,022 thousand Euro when considering the same scope of consolidation), is due to the greater need for raw materials, in view of the increase in sales volumes in the year compared to the same period in 2024. In addition, there were higher customs duties and transport costs on purchases than in the same period of the previous year, which contributed to the increase in the item by 893 thousand Euro.

32. Service costs

"Service costs" amounted to 23,031 thousand Euro, an overall increase of 1,011 thousand Euro compared to the figure of 31 December 2024, when they amounted to 22,020 thousand Euro. They are analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Services	22,280	21,233	1,047
Use of third-party assets	751	787	(36)
Total	23,031	22,020	1,011

Lease fees no longer allocated to the income statement under operating costs due to implementation of the new accounting standard IFRS 16 amounted to 1,463 thousand Euro (1,305 thousand Euro on 31 December 2024). Contracts excluded from the adoption of IFRS 16 on the basis of the provisions of the standard, for which lease fees continue to be entered in the income statement, resulted in an entry of 751 thousand Euro in costs for use of third-party assets at 31 December 2025 (as compared to 787 thousand Euro in 2024).

With reference to the item "Services", other than the rental fees described above, the item posted an increase of 1,047 thousand Euro in 2025 compared to the previous year. Overall, the change is the result of higher costs for professional and consultancy services (especially administrative and management consultancy), as well as for advertising and trade fairs, external processing and personnel training and search costs.

33. Miscellaneous management costs and other operating income

Miscellaneous management costs came at 795 thousand Euro, lower than on 31 December 2024, when they amounted to 1,012 thousand Euro. The break-

down is as follows:

(Euro /000)	31 December2025	31 December2024	Change
Capital losses on the sale of assets	(5)	(3)	(2)
Losses on other receivables	(3)	-	(3)
Other taxes and duties	(399)	(454)	55
Membership fees	(268)	(233)	(35)
Miscellaneous	(120)	(322)	202
Total	(795)	(1,012)	217

The item Other operating income amounted to 111 thousand Euro, as compared to 114 thousand Euro in 2024. This item is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Capital gains on the sale of assets	5	37	(32)
Miscellaneous	106	77	29
Total	111	114	(3)

34. Personnel costs

"Personnel costs" amounted to 53,160 thousand Euro, posting an increase compared to the figure of 31 December 2024 of 3,687 thousand (2,748 thousand Euro without considering the costs brought on by the acquisition of CZ Elettronica S.r.l.). The change is shown below:

(Euro /000)	31 December2025	31 December2024	Change
Salaries and wages	39,872	37,276	2,596
Social security contributions	10,396	9,731	665
Post-employment benefit reserve	2,275	2,111	164
Other costs	617	355	262
Total	53,160	49,473	3,687

At the close of the year, there were 748 employees in the Group, compared with 699 at 31 December 2024. During the first quarter of 2025, a total of 10 temporary workers were stabilised in Italian companies (in the first quarter of 2024, 31 temporary workers were stabilised in Italy).

In addition, personnel changes in 2025 include the effect of the entry into the Group of the newly acquired CZ Elettronica S.r.l. together with its subsidiary Mecatronica S.r.l., now incorporated into its parent, with a total workforce of 23 employees at the acquisition date (9 of whom were manual workers and 14 clerical staff).

With the exception of stabilised temporary workers (whose labour costs were recorded in the item in question also in the previous year), the general increase in personnel costs compared to the costs incurred in 2024 is related to the strengthening of the workforce to support the execution of the Group's strategy.

"Social security contributions" include costs for defined contribution plans for management (Previndai and Azimut Previdenza pension plan) amounting to 151 thousand Euro (127 thousand Euro at 31 December 2024).

"Other costs", up by 262 thousand Euro compared to the previous year, mainly refer to commissions on sales paid to employees (159 thousand Euro at 31 December 2025 and 169 thousand Euro at 31 December 2024), as well as to restructuring charges arising from the reorganisation of Group companies (357 thousand Euro in 2025 and 99 thousand Euro in the previous year).

Like the headcount figure, the average number (calculated as annual average) of Group employees in 2025 also increased compared to the figure for 2024.

31 December2025	31 December2024	Change
		1
		30
		18
724	675	49
	15467242	14437224

35. Depreciation, amortisation and

impairment

These items amounted to 8,110 thousand Euro, as compared to 7,931 thousand Euro in the year 2024. These totals are analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Intangible assets	1,856	1,770	86
Tangible assets	4,865	4,885	(20)
Usage rights	1,389	1,276	113
Total	8,110	7,931	179

The change, increasing by 179 thousand Euro, is affected by the high level of investment completed by the Group during the last two years. There were no write-downs in 2025 and 2024.

In addition, since 1 January 2019 this item includes amortisation of right-ofuse assets in accordance with accounting standard IFRS16; its value as of 31 December 2025 totalled 1,389 thousand Euro (1,276 thousand Euro on 31

December 2024).

Annual Financial Report at 31 december 2025 Gefran Group

The breakdown of "Depreciation, amortisation and impairment" is analysed by business area in the following table:

(Euro /000)	31 December2025	31 December2024	Change
Sensors	4,602	4,634	(32)
Automation components	3,508	3,297	211
Total	8,110	7,931	179

36. Gains (losses) from financial assets/liabilities

The net loss of 725 thousand Euro compares with a net gain of 189 thousand Euro in the period ended 31 December 2024. The change is shown below:

(Euro /000)	31 December2025	31 December2024	Change
Cash management
Income from cash management	818	1,279	(461)
Other financial income	20	28	(8)
Medium-/long-term interest	(684)	(934)	250
Other financial charges	(24)	(30)	6
Total income (charges) from cash management	130	343	(213)
Currency transactions
Exchange rate gains	477	369	108
Positive currency valuation differences	15	156	(141)
Exchange rate losses	(1,064)	(599)	(465)
Negative currency valuation differences	(190)	(28)	(162)
Total other income (charges) from currencytransactions	(762)	(102)	(660)
Other
Gains from financial instruments	4	1	3
Interest on financial payables due to leasing underIFRS 16	(97)	(53)	(44)
Total other financial income (charges)	(93)	(52)	(41)
Gains (losses) from financial assets/liabilities	(725)	189	(914)

Cash management, which was positive overall as at 31 December 2025, consists of income of 838 thousand Euro (1,307 thousand Euro as at 31 December 2024) and charges totalling 708 thousand Euro (964 thousand Euro as at 31 December 2024).

The balance of differences on currency transactions was negative and amounted to 762 thousand Euro, compared with the previous year's negative balance of 102 thousand Euro. The change is primarily a result of the trend in exchange rates between the Euro and the Indian Rupee and the Chinese Renminbi.

The item "Other financial charges" includes charges on financial payables resulting from application of accounting standard IFRS 16, equal to 97 thousand Euro in 2025 (53 thousand Euro in 2024).

37. Gains (losses) from valuation at

equity

	(Euro /000)
--	-------------

	Result of companies valu
Total

(Euro /000)	31 December2025	31 December2024	Change
Result of companies valued at equity	12	39	(27)
Total	12	39	(27)

In the year 2025, profits were recorded from shareholdings valued at equity totalling 12 thousand Euro, reflecting the results of Axel S.r.l. They compared with profits for 39 thousand Euro recorded in 2024.

38. Income taxes, deferred tax assets and deferred tax liabilities

The item "Taxes" was negative overall and equal to 3,751 thousand Euro while at 31 December 2024 it was negative by 4,211 thousand Euro. Taxation is analysed below:

(Euro /000)	31 December2025	31 December2024	Change
Current taxes
IRES (corporate income tax)	(1,805)	(1,648)	(157)
IRAP (regional production tax)	(476)	(411)	(65)
Foreign taxes	(1,182)	(1,492)	310
Total current taxes	(3,463)	(3,551)	88
Deferred tax assets and liabilities
Deferred tax liabilities	(139)	16	(155)
Deferred tax assets	(149)	(676)	527
Total deferred tax assets and liabilities	(288)	(660)	372
Total taxes	(3,751)	(4,211)	460

Current taxes were on the whole equal to 3,463 thousand Euro, down by 88 thousand Euro over the figure for the year 2024.

Deferred taxes, which were negative overall and amounted to 288 thousand Euro, mainly derive from the releases of recorded deferred tax assets, particularly on the impairment of inventories (Gefran S.p.A. and Gefran Soluzioni S.r.l.), as well as from the recognition of deferred liabilities (Gefran Inc).

It should also be noted that, in application of the amendment to IAS 12 "Income Taxes" published by the IASB on 7 May 2021 and which came into effect on 1 January 2023, deferred tax assets were recognised in 2025 for a value of 19 thousand Euro and no deferred tax liabilities were recognised (at 31 December 2024, deferred tax assets for a value of 21 thousand Euro were recognised and no deferred tax liabilities were recognised). For the presentation in the statement of financial position, deferred tax assets and liabilities have been offset, as required by IAS 12.

The table below shows the reconciliation between recognised income taxes and theoretical taxes resulting from the application of the IRES (corporate income tax) rate in force during the year to pre-tax profit:

(Euro /000)	31 December 2025	31 December 2024
Profit (loss) before tax	13,620	15,353
Theoretical income taxes	(3,294)	(3,734)
Effect from use of losses carriedforward	108	476
Rate effect for affiliates	(59)	(85)
Net effect of permanentdifferences	(128)	(121)
Net effect of permanentdifferences for affiliates	234	1
Net effect of temporarydeductible and taxabledifferences	61	314
Effect of taxes from previousyears	126	24
Current taxes	(2,952)	(3,125)
Income tax – deferred tax assets/liabilities	(258)	(605)
Recognised income taxes(excluding current anddeferred regional productiontax IRAP)	(3,210)	(3,730)
IRAP - current taxes	(511)	(426)
IRAP - deferred tax assets/liabilities	(30)	(55)
Recognised income taxes(current and deferred)	(3,751)	(4,211)
	For a greater understanding of the difference between tax charges recordedin the financial statements and the theoretical tax charge, it should be notedthat the theoretical tax charge does not take IRAP (regional production tax) intoaccount, since this tax has a different taxable base from pre-tax profit and

would therefore generate discrepancies from one year to the next. Theoretical taxes were therefore calculated solely by applying the current tax rate in Italy (IRES (corporate income tax) at 24%) to the profit (loss) before tax.

The following table analyses the changes in deferred tax assets and deferred tax liabilities in 2025 and in the previous year.

(Euro /000)	31 December2024	Posted tothe incomestatement	Recognised inshareholders'equity	Exchange ratedifferences	31 December2025
Deferred tax assets
Impairment of
inventories	610	(223)	-	(3)	384
Impairment of
trade receivables	185	(14)	-	(1)	170
Impairment of	540	1	-	(1)	540
assets
Deductible losses
to be brought	360	(91)	-	(7)	262
forward
Exchange rate	6	(6)	-	-	-
fluctuations
Elimination
of unrealised	376	(2)	-	-	374
margins on
inventories
Provision for
product warrantyrisk	202	(35)	-	-	167
Provision for	30	202	(10)	(4)	224
sundry risks
Fair value hedging	66	-	(25)	-	41
Other deferred	21	19	-	-	40
tax assets
Total deferred	2,396	(149)	(35)	(16)	2,202
tax assets
Deferred tax liabilities
Discounting
post-employment	(14)	9	(22)	-	(27)
benefits reserve
Fair value
measurement	(1)	1	-	-	-
Currency
valuation	-	-	-	-	-
differences
Other deferredtax liabilities	(918)	(149)	-	109	(958)
Total deferred
tax liabilities	(933)	(139)	(22)	109	(985)
Total	1,463	(288)	(57)	93	1,217

(Euro /000)	31 December2023	Posted tothe incomestatement	Recognised inshareholders'equity	Exchange ratedifferences	31 December2024
Deferred tax assets
Impairment of	968	(359)	-	1	610
inventories
Impairment of	234	(49)	-	-	185
trade receivablesImpairment of
assets	541	(1)	-	-	540
Deductible losses
to be brought	635	(281)	-	6	360
forward
Elimination
of unrealised
margins on	353	23	-	-	376
inventories
Provision for
product warranty	219	(17)	-	-	202
risk
Provision for	29	(4)	6	(1)	30
sundry risks
Fair value hedging	-	-	66	-	66
Other deferred	15	6	-	-	21
tax assets
Total deferredtax assets	2,994	(676)	72	6	2,396
Deferred tax liabilities
Discounting
post-employment	(7)	-	(7)	-	(14)
benefits reserve
Fair value	(44)	(2)	45	-	(1)
measurement
Currency
valuation	(6)	6	-	-	-
differences
Other deferred	(877)	12	-	(53)	(918)
tax liabilities
Total deferred	(934)	16	38	(53)	(933)
tax liabilities
Total	2,060	(660)	110	(47)	1,463

39. Guarantees granted, commitments and other contingent liabilities

regarded as likely to generate significant liabilities not already covered by existing provisions. In particular, an employment case is currently under way against a former employee of the Parent Company Gefran S.p.A.

c. Commitments

The Group has entered into contracts for the rental of buildings and the lease of equipment, electronic machinery and company vehicles. Pursuant to IFRS 16, the initial lease liability is capitalised as a RoU asset with a matching entry to Financial payables due to leasing under IFRS 16; see the related explanatory notes for more information.

As required under the accounting standard, some residual existing contracts have been excluded from the scope of application as they meet the requirements for exclusion; leasing costs for these contracts entered in the income statement amounted to 751 thousand Euro in the year 2025 (787 thousand Euro in the year 2024).

At 31 December 2025, the total value of the Group's commitments was 979 thousand Euro, for leasing and rental contracts expiring within the next five years, which do not fall within the scope of application of IFRS 16 (equal to 905 thousand Euro at 31 December 2024). This amount mainly refers to ancillary services pertaining to contracts subject to IFRS 16, as well as to contracts for which, based on their value and duration, the above standard has not been applied.

40. Dealings with related parties

The following information on Group companies' dealings with related parties in the years 2025 and 2024 is provided in accordance with IAS 24.

In accordance with Consob resolution no. 17221 of 12 March 2010, the Gefran S.p.A. Board of Directors adopted the Regulation on related-party transactions, the current version of which was updated by the Board of Directors of Gefran S.p.A. on 12 February 2026 and can be viewed on the Company's website in the section Investor/Governance/Shareholders' meetings (at https:// www.gefran.com/governance/documents-and-procedures/).

Transactions with related parties are part of normal operations and the typical business of each entity involved and are carried out under normal market conditions. There have not been any atypical or unusual transactions.

a. Guarantees granted

At 31 December 2025, the Group had given guarantees for the payables or commitments of third parties or subsidiaries totalling 1,304 thousand Euro. These are summarised in the table below.

(Euro /000)	31 December 2025	31 December 2024
Sandrini Costruzioni	66	66
Sandrini Costruzioni	29	29
WEG Equipamentos Elétricos S.A.	1,150	1,150
SMS Group	-	50
SMS Group	67	-
SMS Group	67	-
SMS Group	25	-
SMS Group	50	-
Tenova S.p.A.	-	9
Total	1,454	1,304

The two sureties issued in favour of Sandrini Costruzioni guarantee the rent of the industrial property used by Elettropiemme S.r.l. under 2 leases: the first will expire on 31 January 2027 while the other will expire on 31 December 2029.

On 30 September 2022, with regard to the sale of the motion control business to the Brazilian group WEG, Gefran S.p.A. issued a bank guarantee to WEG Equipamentos Eléctricos S.A., expiring on 30 September 2026. This guarantee, originally signed for 2,300 thousand Euro, now amounts to 1,150 thousand Euro.

There are also bank guarantees covering the quality of the products supplied to SMS Group, a customer served by Elettropiemme S.r.l., totalling 209 thousand Euro, issued during 2025 with different maturities (67 thousand Euro on 13 January 2026, 67 thousand Euro on 13 January 2029, 25 thousand Euro on 31 July 2027 and 50 thousand Euro on 31 March 2028).

b. Legal proceedings and disputes

The Parent Company and certain subsidiaries are involved in various legal proceedings and disputes. However, the resolution of these disputes is not

Annual Financial Report at 31 december 2025 Gefran Group

Noting that the economic and equity effects of consolidated intragroup transactions are eliminated in the consolidation process, the most significant 28 dealings with related parties are listed below. These transactions have no material impact on the Group's economic and financial structure. They are summarised in the following tables:

(Euro /000)	Marfran S.r.l.	Total
Revenues from product sales
2024	-	-
2025	154	154

(Euro /000)	Marfran S.r.l.	Imet S.p.A.	Total
Costs of raw materials andaccessories
2024	-	(507)	(507)
2025	(28)	(723)	(751)

(Euro /000)	B. T. Schlaepfer	Climat S.r.l.	Total
Service costs
2024	(108)	(144)	(252)
2025	(108)	(182)	(290)

(Euro /000)	Climat S.r.l.	Imet S.p.A.	Total
Property, plant, machinery
and tools
2024	198	-	198
2025	345	-	345
Trade payables
2024	144	170	314
2025	335	223	558

It should also be noted that employment relationships with related parties are active within Group companies, for a total amount of 104 thousand Euro at 31 December 2025.

In its dealings with its subsidiaries, the Parent Company Gefran S.p.A. has provided technical and administrative/management services and paid royalties on behalf of the Group's operative subsidiaries totalling 3.8 million Euro under specific contracts (3.6 million Euro as of 31 December 2024).

28 As per internal regulations, the threshold of 50 thousand Euro identifies the most significant dealings; dealings of lower amounts are therefore not reported.

Gefran S.p.A. provides a Group cash pooling service, partly through a "Zero Balance" service, which involves all the European subsidiaries and the Singapore subsidiary.

None of the subsidiaries holds shares of the Parent Company or held them

during the period.

In the year 2025, the Parent Company Gefran S.p.A. recognised dividends from subsidiaries amounting to 4.5 million Euro (4.3 million Euro in 2024).

Members of the Board of Directors and the Board of Statutory Auditors were paid the following aggregate remuneration: 279 thousand Euro included in personnel costs and 1,227 thousand Euro included in service costs (258 thousand Euro included in personnel costs and 1,287 thousand Euro included in service costs in 2024). With regard to the remuneration of executives with strategic responsibility, reference is made to the Remuneration Report as at

31 December 2025.

Persons of strategic importance have been identified as members of the executive Board of Directors of Gefran S.p.A. and of other Group companies, as well as executives with strategic responsibility, identified in the following Group figures: Chief Financial Officer, Chief People & Organization Officer, Chief Sales Officer, Chief Technology Officer, Sensors Unit Director and Chief Operation Officer.

41. Information pursuant to Article 149-duodecies of the Consob Issuers' Regulation

The table below shows fees paid in relation to the year 2025 for auditing services and for services other than auditing provided by the External Auditor and entities in its network, including the External Auditor Willi & Partners which is not part of the Deloitte network with regard to the subsidiary Gefran Schweiz AG.

(Euro /000)	Party that providedthe service	Recipient	Fees for 31 December 2025
		Deloitte & Touche S.p.A. Parent company Gefran
Accounts audit		S.p.A.	106
	Deloitte & Touche S.p.A. Subsidiaries		58
	Deloitte network	Subsidiaries	123
	Local Accounts Auditor Subsidiary Gefran
		Schweiz AG	11
Accounts audit on
	Sustainability Reporting Deloitte & Touche S.p.A. Parent company Gefran	S.p.A.	50
Total			348

Accounts audit on

42. Events after 31 December 2025

With regard to operating performance at the beginning of 2025, we refer to the paragraphs on Significant events after the end of 2025 and Outlook contained in the Report on Operations.

In view of the current geo-political scenario, it should be noted that the Group does not own strategic assets in the territories currently involved and that sales in these regions are limited. Although the scenario may evolve further, in light of the current forecasts, Gefran does not consider the hostilities that have occurred to have a significant impact on its activities and consequently its ability to generate income.

No other significant events took place after the year-end.

43. Summary of public funds pursuant to Article 1, paragraphs 125-129, Law no. 124/2017

In compliance with the transparency and publicity requirements provided for under Law no. 124 of 4 August 2017, Article 1, paragraphs 125-129, which made it compulsory for companies to disclose "subsidies, contributions, and other economic advantages of any kind" in the notes to the financial statements, the details of the relevant amounts are given below, in addition to what has already been published in the Italian national register of state aid – transparency of individual aid.

(Euro /000)	Providing body	Values at 31 December 2025
R&D Tax credit	Italian government	205
Industry 4.0 Tax credit	Italian government	321
Total		526

44. Other information

Pursuant to Article 70, paragraph 8, and Article 71, paragraph 1-bis, of the Consob "Issuers' Regulation", the Board of Directors decided to take advantage of the option to derogate from the obligation to publish the information documents required in relation to significant mergers, spin-offs, capital increases through contribution in kind, acquisitions and disposals.

Provaglio d'Iseo, 12 March 2026

For the Board of Directors

Chairwoman

Maria Chiara Franceschetti

Chief Executive Officer

Marcello Perini

Annual Financial Report at 31 december 2025 Gefran Group

a. Consolidated income statement by quarter

Q1	Q2	Q3	Q4	TOT	Q1	Q2	Q3	Q4	TOT
2024	2024	2024	2024	2024	2025	2025	2025	2025	2025
									138,964
474	579	450	645	2,148	397	520	540	768	2,225
10,081	9,824	9,157	10,263	39,325	10,152	11,215	9,509	10,839	41,715
24,549	25,098	23,393	22,390	95,430	26,687	25,018	24,006	23,763	99,474
5,538	5,912	5,417	6,034	22,901	6,155	5,790	5,773	6,153	23,871
11,883	12,981	11,901	12,708	49,473	12,696	13,300	13,140	14,024	53,160
7,128	6,205	6,075	3,648	23,056	7,836	5,928	5,093	3,586	22,443
2,021	1,962	1,970	1,978	7,931	1,969	2,015	2,058	2,068	8,110
									14,333
55	43	(232)	323	189	(248)	(505)	(115)	143	(725)
									12
5,164	4,298	3,882	2,009	15,353	5,623	3,399	2,919	1,679	13,620
									(3,751)
3,808	3,355	2,929	1,050	11,142	4,085	2,547	2,168	1,069	9,869
3,808	3,355	2,929	1,050	11,142	4,085	2,533	2,152	1,099	9,869
-	-	-	-	-	-	14	16	(30)	-
	34,1565,1072(1,356)	34,3434,24312(943)	32,1004,1059(953)	32,0081,67016(959)	132,60715,12539(4,211)	36,4425,8674(1,538)	35,7133,913(9)(852)	32,9753,035(1)(751)	33,8341,51818(610)

b. Exchange rates used to translate the financial statements of foreign companies

End-of-period exchange rates

Currency	31 December 2025	31 December 2024
Swiss franc	0.9314	0.9412
Pound sterling	0.8726	0.8292
U.S. dollar	1.1750	1.0389
Brazilian real	6.4364	6.4253
Chinese renminbi	8.2262	7.5833
Indian rupee	105.5965	88.9335

Average exchange rates in the period

		4Q 2025	4Q 2024
0.9371	0.9526	0.9304	0.9360
0.8566	0.8466	0.8755	0.8323
1.1293	1.0821	1.1633	1.0671
6.3055	5.8268	6.2716	6.2256
8.1150	7.7863	8.2483	7.6730
98.4647	90.5307	103.6528	90.1145
		31 December 2025 31 December 2024

c. List of subsidiaries included in the scope of consolidation

Name	Registeredoffice	Nation	Currency	Share capital	Parentcompany	% ofdirectownership
Gefran UK Ltd.	Warrington	UnitedKingdom	GBP	4,096,000	Gefran S.p.A.	100.00
GefranDeutschlandGmbH	Seligenstadt	Germany	EUR	365,000	Gefran S.p.A.	100.00
Gefran FranceS.A.	Saint-Priest	France	EUR	800,000	Gefran S.p.A.	99.99
Gefran BeneluxN.V.	Geel	Belgium	EUR	344,000	Gefran S.p.A.	100.00
Gefran Inc.	North Andover United States USD			1,900,070	Gefran S.p.A.	100.00
Gefran Brasil					Gefran S.p.A.	99.90
EletroeletrônicaLtda.	San Paolo	Brazil	BRL	450,000	GefranSchweiz AG	0.10
Gefran IndiaPrivate Ltd.	Pune	India	INR	100,000,000	Gefran S.p.A.GefranSchweiz AG	95.005.00
Gefran Asia Pte.Ltd.	Singapore	Singapore	EUR	3,359,369	Gefran S.p.A.	100.00
GefranAutomationTechnology(Shanghai) Co.Ltd.	Shanghai	China (PRC)	RMB	28,940,000	Gefran AsiaPte. Ltd.	100.00
Gefran SchweizAG	Aadorf	Switzerland	CHF	100,000	Gefran S.p.A.	100.00
Gefran SoluzioniS.r.l.	Provaglio d'Iseo Italy		EUR	100,000	Gefran S.p.A.	100.00
ElettropiemmeS.r.l.	Trento	Italy	EUR	70,000	GefranSoluzioni S.r.l.	100.00
CZ ElettronicaS.r.l.	MonticelloConte Otto	Italy	EUR	10,400	Gefran S.p.A.	60.00

450 451

d. List of companies consolidated at equity

Name	Registeredoffice	Nation	Currency	Sharecapital	Parentcompany	% ofdirectownership
Axel S.r.l.	Crosio dellaValle	Italy	EUR	26,008	Gefran S.p.A.	15.00
Robot At Work S.r.l. Rovato		Italy	EUR	14,500	Gefran S.p.A.	24.83
40Factory S.r.l.	Piacenza	Italy	EUR	18,804	Gefran S.p.A.	22.00

e. List of other affiliates

Name	Registeredoffice	Nation	Currency	Sharecapital	Parentcompany	% ofdirectownership
Colombera S.p.A. Iseo		Italy	EUR	8,788,230	Gefran S.p.A.	17.08
Woojin Plaimm CoLtd	Seoul	South Korea	WON	3,200,000,000	Gefran S.p.A.	2.00
CSMT GESTIONES.C.A.R.L.	Brescia	Italy	EUR	1,400,000	Gefran S.p.A.	1.78

CERTIFICATION OF CONSOLIDATED FINANCIAL STATEMENTS PURSUANT TO ARTICLE 81-TER OF CONSOB REGULATION NO. 11971 DATED 14 MAY 1999, AS AMENDED

The undersigned Marcello Perini, in his capacity as Chief Executive Officer, and Paolo Beccaria, in his capacity as Executive in charge of financial reporting of Gefran S.p.A., hereby certify, with due regard for the provisions of Article 154-bis, paragraphs 3 and 4, of Italian Legislative Decree no. 58 of 24 February 1998:

the adequacy, with respect to the Company's characteristics,

and

the effective application of the administrative and accounting procedures applied in the preparation of the consolidated financial statements in 2025.

They further certify that

/ the Consolidated financial statements:

− were prepared in accordance with the applicable international accounting standards endorsed by the European Union pursuant to Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002; − correspond to the entries made in accounting ledgers and records;

− provide a true and accurate representation of the economic and financial situation of the issuer and all companies

• included in the scope of consolidation.

/ the Report on Operations contains a reliable analysis of operating performance, results and condition of the issuer and all companies included in the scope of consolidation, together with a description of the main risks and uncertainties to which they are exposed.

Provaglio d'Iseo, 12 March 2026

Chief Executive Officer

Marcello Perini

Executive in charge of financial reporting

Paolo Beccaria

GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS AT 31 DECEMBER 2025

GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS

REPORT ON OPERATIONS OF GEFRAN S.P.A.

1 GEFRAN S.P.A. RESULTS

The following table shows the operating results for the year, reclassified and compared with those of the previous period.

(Euro /000)	31 December2025	31 December2024		Change 2025-2024
	Total	Total	Value	%
a Revenues	86,139	80,305	5,834	7.3%
b Increases for internal work	1,937	2,069	(132)	-6.4%
c Consumption of materials and products	28,078	25,913	2,165	8.4%
d Value Added (a+b-c)	59,998	56,461	3,537	6.3%
e Other operating costs	16,047	14,820	1,227	8.3%
f Personnel costs	29,483	27,412	2,071	7.6%
g EBITDA (d-e-f)	14,468	14,229	239	1.7%
h Depreciation, amortisation and impairment	6,126	6,023	103	1.7%
i EBIT (g-h)	8,342	8,206	136	1.7%
l Gains (losses) from financial assets/liabilities	3,998	4,222	(224)	-5.3%
n Profit (loss) before tax (i±l)	12,340	12,428	(88)	-0.7%
o Taxes	(2,233)	(2,206)	(27)	-1.2%
p Net profit (loss) (n±o)	10,107	10,222	(115)	-1.1%

Added value in the year amounted to 59,998 thousand Euro, representing 69.7% of revenues, as compared to 56,461 thousand Euro in the previous year, equal to 70.3% of revenues. The change, in absolute terms equal to 3,537 thousand Euro, is due to higher sales volumes, for which margins are slightly lower than in the previous year, due to the different mix of products and customers served.

Other operating costs for 2025 amounted to 16,047 thousand Euro, compared with 14,820 thousand Euro recorded in 2024, representing an increase of 1,227 thousand Euro; this change mainly reflects higher expenses for external processing, professional consultancy, particularly technical and commercial services, as well as advertising and trade fairs.

Personnel costs as at 31 December 2025 amounted to 29,483 thousand Euro, compared with 27,412 thousand Euro in 2024, an increase of 2,071 thousand Euro. The change reflects the higher impact of the salary increase provided for by the National Collective Bargaining Agreement of June 2024 for all Gefran S.p.A. employees, as well as the increase in workforce to support the execution of the Group's strategy. Overall, the average number of employees in 2025 (calculated as the annual average) was 391 while in 2024 it was 364.

Depreciation/amortisation for the year just ended amounted to 6,126 thousand Euro, up 103 thousand Euro over the figure for 31 December 2024, reflecting the investment plan carried out by the Company in the last three years (9,520 thousand Euro in 2023, 5,184 thousand Euro in 2024 and 8,484 thousand Euro in 2025).

In 2025 EBIT was positive at 8,342 thousand Euro (9.7% of revenues), compared with a positive EBIT of 8,206 thousand Euro in December 2024 (10.2% of revenues). The additional added value generated, thanks to the increase in revenues, was almost fully absorbed by higher personnel costs and operating costs recorded in the year compared with the previous year.

Financial management for the year showed an overall positive balance of 3,998 thousand Euro; in the previous year it showed a positive balance of 4,222 thousand Euro. The following are included:

• / dividends from equity investments totalling 4,450 thousand Euro, compared to 4,310 thousand Euro in dividends in 2024;
• / financial income of 787 thousand Euro (1,262 thousand Euro in 2024);
• / financial charges linked to the Company's indebtedness, amounting to 937 thousand Euro, down overall since 2024, when they amounted to 1,371 thousand Euro, as a result of lower outstanding loans;
• / the negative result of differences in foreign currency transactions, totalling 51 thousand Euro, as compared to a positive result of 36 thousand Euro in 2024;
• / adjustments to the value of non-current assets, negative for 230 thousand Euro, linked to the adjustment to the value of the equity investment in Gefran Schweiz AG, following the impairment test (in 2024 there were no adjustments to non-current assets).
• / financial charges on financial debts as a result of the application of the new accounting standard IFRS16 totalling 25 thousand Euro (16 thousand Euro in the year 2024).

Taxes were, on the whole, negative by 2,233 thousand Euro (negative by 2,206 thousand Euro as of 31 December 2024). They consist of:

• / negative current taxes of 2,051 thousand Euro (negative for the amount of 1,824 thousand Euro as at 31 December 2024);
• / deferred tax assets and liabilities, negative overall and amounting to 182 thousand Euro (negative by 382 thousand Euro at 31 December 2023); the item mainly refers to the release of deferred tax assets related to changes in the inventory write-down provision.

The Net profit (loss) of Gefran S.p.A. as at 31 December 2024 was positive at 10,107 thousand Euro (11.7% of revenues) compared with the net profit of 10,222 thousand Euro in the previous year (12.7% of revenues), showing a total increase of 115 thousand Euro as a result of the dynamics described above.

Revenues for the year 2025 amounted to 86,139 thousand Euro, up 5,834 thousand Euro over the prior year (equal to 7.3%). Growth was driven by higher revenues from sales of products in the sensors business (+11.3%), while sales of automation components fell (-3.5%).

Analysing the composition of revenues by geographical region, there was a double-digit growth compared with 2024 in the domestic market (+10.4%) and in Asia (+11.2%). Smaller revenue increases were recorded in Europe (+3.5%), with a contraction in the Americas overall (−4.1%).

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

Gefran S.p.A.'s reclassified statement of financial position at 31 December 2025 is as follows:

	31 December 2025		31 December 2024
(Euro /000)	Value	%	Value	%
Intangible assets	7,317	9.7	6,560	9.2
Tangible fixed assets	30,214	40.0	28,674	40.0
Other non-current assets	34,668	45.9	30,226	42.2
Net non-current assets	72,199	95.7	65,460	91.3
Inventories	8,463	11.2	9,233	12.9
Trade receivables	21,371	28.3	19,005	26.5
Trade payables	(17,241)	(22.8)	(14,650)	(20.4)
Other assets/liabilities	(7,248)	(9.6)	(5,172)	(7.2)
Working capital	5,345	7.1	8,416	11.7
Provisions for risks and future liabilities	(658)	(0.9)	(667)	(0.9)
Deferred tax provisions	(27)	(0.0)	(13)	(0.0)
Employee benefits	(1,393)	(1.8)	(1,511)	(2.1)
Net invested capital	75,466	100.0	71,685	100.0
Shareholders' equity	88,283	117.0	84,182	117.4
Non-current financial payables	11,621	15.4	16,116	22.5
Current financial payables	15,632	20.7	17,639	24.6
Financial payables for IFRS 16 leases (currentand non-current)	719	1.0	721	1.0
Financial liabilities for derivatives (current andnon-current)	178	0.2	311	0.4
Financial assets for derivatives (current andnon-current)	(5)	(0.0)	(34)	(0.0)
Non-current financial investments	(102)	(0.1)	(104)	(0.1)
Cash and cash equivalents and current	(40,860)	(54.1)	(47,146)	(65.8)
financial receivablesNet debt relating to operations	(12,817)	(17.0)	(12,497)	(17.4)
Total sources of financing	75,466	100.0	71,685	100.0

Net non-current assets amounted to 72,199 thousand Euro, up by 6,739 thousand Euro from the figure for 31 December 2024. The following changes are highlighted:

/ tangible and intangible assets include increases for new investments totalling 8,484 thousand Euro, decreases related to depreciation/amortisation totalling 5,800 thousand Euro and disposals totalling 382 thousand Euro; the item includes the entry of right-of-use assets with reference to IFRS 16 accounting standard, which increased for new contracts signed in 2025 amounting to 317 thousand Euro, offset by the amortisation of

• such rights totalling 326 thousand Euro;
• 31 December 2024).

/ other non-current assets show an overall increase of 4,442 thousand Euro, mainly due to the acquisition of 22% of the share capital of 40Factory S.r.l. (4,000 thousand Euro), recorded among the investments accounted for at equity of the Parent Company Gefran S.p.A., the acquisition of 60% of CZ Elettronica S.r.l. (919 thousand Euro), a subsidiary of Gefran S.p.A. since April 2025, as well as the recognition of an adjustment to the carrying amount of the equity investment in Gefran Schweiz AG (negative in the amount of 230 thousand Euro); this item includes, inter alia, deferred tax assets (down by 209 thousand Euro compared to

Working capital amounted to 5,345 thousand Euro, 3,071 thousand Euro lower than on 31 December 2024; the changes in individual components are as follows:

/ inventories, which at year end amounted to 8,463 thousand Euro, lower than the 2024 value of 9,233

/ trade receivables, which amounted to 21,371 thousand Euro, showing an increase of 2,366 thousand Euro;

/ trade payables of 17,241 thousand Euro, compared with 14,650 thousand Euro at 31 December 2024;

• thousand Euro;

• to employees and social security institutions.

/ other net assets and liabilities, negative by 7,248 thousand Euro at 31 December 2025, compare with a negative figure of 5,172 thousand Euro at 31 December 2024; the change primarily relates to the increase in tax payables and the concurrent increase in payables The provisions for risks and future liabilities amounted to 658 thousand Euro and compare with the figure of 667 thousand Euro for 31 December 2024; the product warranty provision and agent commission provision are included. The change compared with the previous year mainly concerns the change in the product warranty provision (a total decrease of 62 thousand Euro) and the risk provisions for legal disputes (a provision of 50 thousand Euro, for an ongoing employment case concerning a former employee).

Employee benefits amounted to 1,393 thousand Euro, down by 118 thousand Euro compared with the previous year. This item, in addition to the post-employment benefit reserve, includes residual payables to employees who have signed agreements that protect the Company from competing activities (so-called Non-competition agreements), amounting to 58 thousand Euro at 31 December 2025 (73 thousand Euro at 31 December 2024). The change, which includes both the provision for post-employment benefits and non-competition agreements, encompasses disbursements to employees of a total of 96 thousand Euro and the effect of discounting the existing debt pursuant to IAS, negative by 22 thousand Euro.

Shareholders' equity as at 31 December 2025 amounted to 88,283 thousand Euro, an increase of 4,101 thousand Euro compared to the previous year as a result of the recognition of the net profit for the year (10,107 thousand Euro), offset by the payment of dividends (6,107 thousand Euro) and the adjustment of cash flow hedging reserves, securities valuation at fair value and IAS 19 (overall positive by 100 thousand Euro).

Net financial position at 31 December 2025 was positive by 12,817 thousand Euro, an improvement of 320 thousand Euro over 31 December 2024, when it was positive by 12,497 thousand. This change originates essentially from the positive cash flows generated by typical operations (14,915 thousand Euro) and the collection of dividends from subsidiaries (4,421 thousand Euro), absorbed in part by disbursements for investment activities (totalling 12,965 thousand Euro) and the payment of dividends (6,107 thousand Euro).

(Euro /.000)	31 December2025	31 December2024	Change
Cash and cash equivalents and current financialreceivables	40,074	46,818	(6,744)
Financial receivables from subsidiaries	786	328	458
Current financial payables	(4,837)	(5,095)	258
Current financial payables for IFRS 16 leases	(314)	(277)	(37)
Financial payables to subsidiaries	(10,795)	(12,544)	1,749
(Debt)/short-term cash and cash equivalents	24,914	29,230	(4,316)
Non-current financial payables	(11,621)	(16,116)	4,495
Non-current financial payables for IFRS 16 leases	(405)	(444)	39
Financial liabilities for derivatives	(178)	(311)	(133)
Financial assets for derivatives	5	34	(29)
Non-current financial assets	102	104	(2)
(Debt)/medium-/long-term cash and cashequivalents	(12,097)	(16,733)	4,636
Net financial position	12,817	12,497	320

It should be noted that the statement of "Net financial position" includes the item "Other non-current financial assets", including financial pre-paid expenses totalling 2 thousand Euro, net of which, and for the purposes of EU Regulation 2017 1129, the net financial position at 31 December 2025 was positive and equal to 12,815 thousand Euro (at 31 December 2024 it was positive by 12,493 thousand Euro).

Cash flow from operations for the period was positive, and relates entirely to operations in 2025 which, net of allocations, depreciation/amortisation and financial items, generated cash of 15,770 thousand Euro (positive at 15,671 thousand Euro in 2024).

Technical and financial investments, net of disposals, absorbed resources of 12,965 thousand Euro (of which 8,484 thousand Euro for technical investments, 4,000 thousand Euro absorbed for the acquisition of the shares of 40Factory S.r.l. and 919 thousand Euro for the acquisition of CZ Elettronica S.r.l.), as compared with investments of 4,971 thousand Euro in 2024.

In view of these dynamics, free cash flow (operating cash flow excluding investment) was positive by 1,950 thousand Euro, as compared with a positive figure of 11,373 thousand Euro in 2024.

During 2025, financing activities absorbed a total of 8,694 thousand Euro in resources, mainly due to the repayment of loans (5,035 thousand Euro), the decrease in current financial payables (1,937 thousand Euro), the payment of dividends (6,107 thousand Euro) and interest (718 thousand Euro), partly offset by the collection of dividends from subsidiaries (4,421 thousand Euro) and interest (840 thousand Euro).

During 2024 they had absorbed a total of 10,731 thousand Euro in resources, due to the repayment of loans (9,471 thousand Euro), the payment of dividends (5,965 thousand Euro) and interest (956 thousand Euro), partly offset by the collection of dividends from subsidiaries (4,310 thousand Euro) and interest (1,388 thousand Euro).

(Euro /000)	31 December2025	31 December2024
A) Cash and cash equivalents at the start of the period	46,818	46,176
B) Cash flow generated by (used in) operations in the period	14,915	16,344
C) Cash flow generated by (used in) investment activities	(12,965)	(4,971)
D) Free Cash Flow (B+C)	1,950	11,373
E) Cash flow generated by (used in) financing activities	(8,694)	(10,731)
F) Cash flow from continuing operations (D+E)	(6,744)	642
G) Cash and cash equivalents at the end of the period (A+F)	40,074	46,818

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

2 GEFRAN S.P.A.

HUMAN RESOURCES

Gefran is made up of its people, and the valorisation of their talents, knowledge and skills contributes to the Company's heritage and therefore its competitiveness.

Gefran promotes talent by focusing on readiness to innovate and renew, a concept that is given concrete meaning in the pragmatic work Gefran's people do together every day. The Company constantly invests in the growth of its People, addressing this important challenge with the systemic perspective of enhancing its employees, focusing on their strengths, in line with the Gefran Way and consistent with the Group's business strategy.

Skills development paths are managed within FLY, the Gefran Talent Academy, and FLY Youth, the session for recent graduates. The tools and methods used represent a combination of actions targeting all levels of the company organisation, including:

• / masters in innovation;
• / managerial coaching;
• / mentoring and reciprocal mentoring;
• / on the job training;
• / participation in focus groups and workshops;
• / classroom education.

FLY Youth, in particular, is a session for recent graduates who are being integrated in the company, also due to the current generational turnover. It includes a programme that offers 4 workshops focusing on the development of 4 fundamental soft skills (results orientation, ability to cooperate, communication, self-management) and sessions held by the managers of the main company departments, in order to train participants on the "Corporate System" and on the organisation of the Company.

The Academy's initiatives are completed by kenFLY, the digital hub of FLY, inspired by the need to make talent development pathways equally available to everyone within the organisation, on the basis of an open and responsible approach. Company employees have access to this platform for practising their skills and know-how, and for exchanging experience and knowledge.

The platform also supports the onboarding process dedicated to introducing new employees to the organisation, in order to facilitate knowledge of processes, products/services and people, both at the level of the function they belong to and at the level of interdepend-

ent functions.

In terms of communication, inspiration and engagement, these tools were offered to all employees on the occasion of different moments of participation and discussion organised during the year, through in-person events or digital initiatives.

Through FLY Performance, the skills assessment and continuous feedback tool, a transparent and structured skills management system is in place for periodic analysis and comparison of skills development, as well as for the sharing of structured feedback. It is based on the shared matrix of competences. The goal is twofold: strengthening people's cross-sectoral skills and techniques while, at the same time, activating and empowering the Management team, strengthening their aptitude for mentoring and providing continuous feedback thanks to growing employability.

In addition to training plans, the Company implements several initiatives that promote employee well-being and loyalty, such as the "WELLFRAN People in Gefran" welfare programme, a comprehensive and innovative package of flexible benefits, services, facilities and conventions

accessible (to employees and their families) through a dedicated web portal. Employees can convert their performance bonus into goods and welfare services, enjoying tax and contribution benefits, as well as a company bonus.

Several initiatives are also in place to improve employees' experience at the company while maintaining a good work life balance. The use of the smart working system applied to business areas compatible with this working mode, used in a flexible way, by alternating working days in attendance and other days remotely, is an important evolution of the traditional working system. For workers in production areas, instead, through a plan defined with the involvement of the trade unions, flexible working hours have been introduced that help to improve life/ work balance in addition to ensuring flexibility, effectiveness and efficiency in production processes.

As regards workforce, during 2025 33 people joined Gefran S.p.A., including 10 manual workers and 20 clerical staff to strengthen the technical, commercial and staff areas, and 3 managers. A total of 20 people left, including 7 manual workers, 12 clerical staff and 2 managers.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

3ENVIRONMENT, HEALTH AND SAFETY IN GEFRAN S.P.A.

Protection of employees' safety, health and well-being and the environment are key values in the organisation of activities, to create added value for all internal and external Stakeholders. This commitment is confirmed and signed through the "Health, Safety and Environment" policy adopted by Gefran S.p.A. and covering the entire Gefran Group, which outlines the principles guiding management of these issues.

Gefran S.p.A. promotes safety primarily through:

• / active participation and consultation of workers in improvement of their working environment;
• / adoption of effective preventive measures against injury on the job, occupational disease and health risks;
• / ongoing training and professional development for workers in relation to the tasks they perform, and for emergency and first aid representatives, supervisors and various figures involved in the Company's Prevention and Protection Service;
• / periodic environmental assessments controlling airborne emissions dispersed and physical agents with the aim of safeguarding the work environment.

The objectives set and the ways in which they are reached are globally endorsed at all levels, shared and periodically verified. In 2023 an important milestone was reached, represented by the Group obtaining certifications according to the following standards:

• / ISO 14001:2015, relating to the Environmental Management System;
• / ISO 45001:2018, relating to the Occupational Health and Safety Management System;
• / SA 8000:2014, for Social Accountability.

Obtaining a certified integrated management system, including not only Quality management (according to the ISO 9001:2015 standard) but also miscellaneous HSE areas, is one of the objectives of the Gefran Group's Strategic Sustainability Plan.

In 2025, training continued at various levels in order to increase awareness of health and safety issues in the workplace, both leveraging internal skills and with the support of an external team of professionals in the sector. The prevention of occupational illness and injury through analysis of historic data, risk assessment, good practice in the sector, and accurate analysis of accidents, near-misses and potentially hazardous situations, remained a central issue.

The effectiveness of health and safety policies and practices is confirmed by the reduced number of accidents reported: in 2025, only 1 accident was recorded to the detriment of an employee of Gefran S.p.A. who suffered a superficial cut during assembly operations. Accidents recorded in the Company in previous years were also not significant: in 2024 there were 2 accidents (involving an employee and a non-employee), while in 2023 there were no accidents.

This approach to reducing environmental risks and focus on climate change characterises the Group's operations. Although it is considered a "non-energy" company, third-party audits and systematic monitoring of energy consumption have highlighted the areas in which energy is most used. This has made it possible to identify intervention priorities and define an investment plan, focused mainly on the progressive replacement of old fluorescent tube light fixtures with LED technology lamps, the replacement of plant and machinery with energy-efficient equipment, the installation of photovoltaic systems for electricity production and the installation of charging points for electric cars.

It should be noted that 100% of the electricity consumed in Gefran S.p.A.'s plants is of certified renewable origin.

Waste management is an aspect to which the Company pays close attention, focusing its activities on minimising impacts on the environment and on people. On the basis of the precise data collected with regard to the waste produced (deriving both from processing and the separate collection of municipal waste) and its different types, actions are planned to reduce the proportion of hazardous waste and the categories of waste intended for disposal, with the aim of maximising the principles of recovery and recycling.

Waste generated by the Company's production processes is mainly of a non-hazardous nature (88.7% of the total in 2025). In terms of allocated use, the main share of waste produced by Gefran S.p.A. is allocated to recovery, i.e. reuse or recycling (72.4% of the total in 2025).

466

4SIGNIFICANT EVENTS IN GEFRAN S.P.A. IN 2025

/ On 31 January 2025 Gefran S.p.A. signed an investment agreement to acquire a minority stake in 40Factory S.r.l. with operational headquarters in Piacenza, a tech scale-up that offers manufacturers of industrial machines and end-users an Industrial loT (Internet of Things) platform for the collection and use of plant data and that also owns a generative artificial intelligence system dedicated to providing support in the use of industrial machines.

The operation is based on an awareness of the strategic importance of data for modern manufacturing companies. Their collection, management, and analysis are essential to optimize processes, improve efficiency, and support decisions. Indeed, thanks to the expertise and IoT services of 40Factory, Gefran is developing its ability to process and transform data collected in the field into more valuable information for customers, further strengthening its role as a strategic partner in the digital and sustainable transformation of production processes.

• / On 13 February 2025, the Board of Directors of Gefran S.p.A. examined the preliminary consolidated results at 31 December 2024.
• / On 13 March 2025, the Board of Directors of Gefran S.p.A. unanimously approved the annual financial statements, the consolidated financial statements and the Sustainability Report as at 31 December 2024.

The Board of Directors also resolved to propose to the Shareholders' Meeting the distribution of a dividend

of 0.43 Euro per share in circulation (not including own shares), by using retained earnings to the necessary extent.

Moreover, the Board of Directors resolved to propose to the Shareholders' Meeting to allocate part of the net profit for 2024 to a specific reserve pursuant to Article 1, para. 436 – 444 of Law No. 207 of 30 December 2024, and to allocate the remaining part of 2024 profit to the retained earnings reserve, in line with the Group's value creation strategy for its shareholders, safeguarding the Group's growth.

During the same meeting, the Board resolved to propose to the Shareholders' Meeting approval of the authorisation to purchase and dispose of, on one or more occasions, a maximum of 1,440,000.00 ordinary shares in the Company, equal to 10% of its share capital. The authorisation was requested for a period of 18 months from the date of the shareholders' resolution.

/ On 18 March 2025, Gefran S.p.A. signed an investment agreement to acquire a majority stake in CZ Elettronica S.r.l., together with its subsidiary Mecatronica S.r.l., both based in the province of Vicenza. The agreement provides for Gefran's entry into the shareholding structure of CZ Elettronica S.r.l. through the sale of shares, following which Gefran S.p.A. will hold a 60% stake in the share capital for a total consideration of 870,000 Euro.

CZ Elettronica S.r.l. specializes in the development of custom turnkey plant solutions for the steel, textile and plastic sectors, and manufactures systems for regulating industrial motorization, standing out on the market for its constant innovation, its use of the most modern digital technologies and its team of highly qualified technicians.

With this operation, Gefran integrates and enriches its wealth of expertise by strengthening its ability to offer tailor-made application solutions to its customers.

/ On 20 March 2025, the investment agreement signed on 31 January 2025 was finalised through a capital increase of 40Factory S.r.l., fully paid up and subscribed by Gefran S.p.A. for a total consideration of 4 million Euro (paid in cash, using its own funds), as a result of which Gefran S.p.A. now holds 22% of the share capital

/ On 1 April 2025, the Swiss subsidiary Sensormate AG

/ On 14 April 2025, the investment agreement signed on 18 March 2025 was finalised through the sale of part of the share capital of CZ Elettronica S.r.l. to Gefran S.p.A., for a total consideration of 870 thousand Euro (paid in cash, using its own funds), as a result of which

/ On 29 April 2025, the Ordinary Shareholders' Meeting of

− Approve the 2024 annual financial statements and distribute an ordinary dividend, gross of withholding taxes provided for by law, of 0.43 Euro per eligible share, by using retained earnings to the necessary extent (ex-dividend date 5 May 2025, record date 6

• of 40Factory S.r.l.
• adopted the new name Gefran Schweiz AG.
• Gefran S.p.A. now holds 60% of the Company.
• Gefran S.p.A. resolved to:
• May 2025 and payment from 7 May 2025).
• ing to 2 million Euro, to the retained earnings reserve.
• Shareholders' Meeting.

− Approve the allocation of a portion of the profit for 2024, amounting to 8.2 million Euro, to a specific reserve pursuant to Article 1 (paragraphs 436-444) of Law no. 207 of 30 December 2024, and the allocation of the remaining portion of the profit for 2024, amount-

− Authorise the Board of Directors to purchase a maximum of 1,440,000 own shares with a face value of 1 Euro each, within 18 months from the date of the

The Shareholders' Meeting, pursuant to Article 123-ter of the Consolidated Law on Finance, also held a binding vote that approved the Group's 2025 Remuneration Policy and also held an advisory and non-binding vote that approved its 2024 Remuneration Report.

• / On 13 May 2025, the Board of Directors of Gefran S.p.A. unanimously approved the consolidated results of the Group at 31 March 2025.
• / On 5 August 2025, the Board of Directors of Gefran S.p.A. unanimously approved the consolidated results at 30 June 2025.
• / Following the transaction dated 19 September 2025, Anima SGR now holds a significant stake in Gefran S.p.A., the Parent Company of the Gefran Group, amounting to 5.258% of its share capital; it should be noted that this stake is held under a discretionary asset management arrangement.
• / With effect from 1 October 2025, the employment relationship with Patrizia Belotti, Chief People & Organization Officer and Chief Communication Officer of the Gefran Group, was terminated. Her two roles are provisionally assigned to Chairwoman Maria Chiara Franceschetti and to Vice Chairwoman Giovanna Franceschetti, respectively.
• / Following purchase and sale transactions on the regulated market, ANIMA SGR, with form 120/A, notified, as required by CONSOB regulation, that the 5% holding threshold had been exceeded. The exact percentage notified on 8 October 2025 was 5.258%.
• / On 13 November 2025, the Board of Directors of Gefran S.p.A. received the resignation of Andrea Franceschetti from the position of Vice-Chairman and Chief Executive Officer with immediate effect. Andrea Franceschetti will continue to serve as a Non-Executive and Non-Independent Director.
• / With effect from 19 November 2025, the employment relationship with Karsten Just, Chief Sales Officer of the Gefran group, came to an end. The role is provisionally assigned to Marcello Perini, already Chief Executive Officer of the Group.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

GEFRAN S.P.A.

Given the latest international estimates and domestic performance indicators, the global economic scenario for 2025–2026 shows signs of resilience compared to previous assessments. The International Monetary Fund confirms a further strengthening of the outlook, with a global growth forecast of +3.3% in 2026 (+3.2% in 2027), supported by the adaptation of global value chains and a strong boost to investments in artificial intelligence technologies.

Regarding the Eurozone, the IMF estimates 1.3% growth in 2026 (+1.4% in 2027), showing an improvement in data from some member countries and a gradual stabilisation of the economic cycle. The Eurosystem projections published by the ECB in December 2025 confirm an expectation of 1.2% growth in the area in 2026, with a further strengthening expected in the following two years, supported by the increase in household incomes, the improvement in financing conditions and the recovery of external demand.

According to the Bank of Italy's Economic Bulletin No. 1/2026, the global economy continues to expand but remains exposed to downside risks due to trade and geopolitical tensions. In the euro area, growth remains moderate but supported by services, while inflation is gradually easing. For Italy, the Bank of Italy estimates GDP growth of 0.6% in 2026, supported mainly by investments and, more selectively, by exports, in the face of

5 6 OUTLOOK FOR SIGNIFICANT EVENTS IN GEFRAN S.P.A. AFTER YEAR END

still cautious domestic demand and increasing international competition in miscellaneous industrial sectors. In the two-year period 2025–26, exports were affected by trade tensions and the contribution is expected to become more favourable again from 2027 onwards.

Gefran S.p.A. posted a positive overall performance in 2025, demonstrating resilience in a complex macroeconomic environment. Revenues grew by 7.3% YoY, driven in particular by the sensors business and an increase in orders. The operating margin remained positive, though affected by the increase in operating costs and a different product mix, resulting in a decrease in net profit.

During the fiscal year, management continued to strengthen production processes, technological innovation and vertical integration, investing in automation and skills development. The commercial strategy supported the growth of orders, consolidating the Company's presence in both traditional industrial sectors and high-tech emerging sectors.

Looking ahead to 2026, in a scenario of heterogeneous demand between sectors and geographical regions, the Group expects moderate growth in revenues and the maintenance of a positive operating margin, with the aim of further strengthening competitiveness and creating sustainable value for stakeholders.

/ On 23 February 2026, Gefran S.p.A. exercised, in advance, the purchase option already provided for in the agreements with the sellers, by acquiring the remaining 40% of the shares in CZ Elettronica S.r.l., for a consideration of 580 thousand Euro, thereby holding 100% of the Company.

The transaction allows Gefran to fully consolidate its control and further strengthen the Group's industrial and technological positioning, enhancing the expertise and know-how of C.Z. Elettronica S.r.l. and fostering greater strategic and operational integration within the organisation.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

7 GEFRAN S.P.A.'S OWN SHARES

As at 31 December 2024, Gefran S.p.A. held 198,405 shares, equal to 1.38% of the total, with an average book value of 8.6483 Euro per share, and a total value of 1,716 thousand Euro.

During 2025 and as at the date of this publication, no trading activities took place; therefore, the situation is unchanged with respect to what is described above.

GEFRAN S.P.A.'S DEALINGS WITH RELATED PARTIES

On 12 November 2010, the Board of Directors of Gefran S.p.A. approved the "Internal Procedure for Transactions with Related Parties", in application of Consob resolution no. 17221 dated 12 March 2010. The procedure in question was subsequently updated to implement the new provisions of EU Directive 2017/828 (so-called "Shareholders' Rights II"), which was transposed into Italian law by Italian Legislative Decree no. 49 of 2019, with regard to primary legislation, and by Consob Resolution no. 21624 of 10 December 2020, with regard to secondary legislation.

This document, the current version of which was approved on 12 February 2026 by the Board of Directors of Gefran S.p.A., is published in the section "Investor/Governance/Documents, procedures and shareholders' agreements" of the Company's website, available at https://www.gefran.com/ governance/documents-and-procedures/.

Information about it is also provided in the "Report on Corporate Governance and Ownership Structure".

See note 34 of the Specific explanatory notes to the separate financial statements of Gefran S.p.A. for details on transactions with related parties.

8

9 10 MAIN RISKS AND UNCERTAINTIES IN GEFRAN S.P.A.

For information on the main risks and uncertainties faced by the Company, please refer to the paragraph "Main risks and uncertainties to which the Gefran Group is exposed" in the Group's Annual report.

With regard to risk management objectives and policies, including the hedging policy and the exposure of Gefran S.p.A. to credit, price, liquidity, interest rate and exchange rate risks, please see the full description in the comments on the financial statement items. With regard to "Management of financial risks", please refer to Note 8 of the Specific explanatory notes to the separate financial statements of Gefran S.p.A.

DISCLOSURE SIMPLIFICATION

On 1 October 2012, the Gefran S.p.A. Board of Directors voted to use the option to provide disclosure simplification pursuant to article 70, paragraph 8, and article 71, paragraph 1-bis, of Consob Regulation no. 11971/1999 as amended.

Dear Shareholders,

We hereby submit for your approval the annual financial statements for the period ending 31 December 2025, which show a profit for the period of 10,107,417 Euro.

Note that the legal reserve reached the limit set by the Italian Civil Code some time ago and that the available reserves amply cover the development costs recorded under non-current assets.

We therefore submit for your approval the following proposed resolution:

"The Ordinary Shareholders' Meeting of Gefran S.p.A., having noted the Board of Statutory Auditors' Report and the External Auditor's Report, votes:

to approve the Board of Directors' Report on Operations and the annual financial statements for the period ending 31 December 2025, which show a profit of 10,107,417 Euro, as presented by the Board of Directors;

to distribute to the shareholders, by way of dividend, gross of the legal withholdings, 0.43 Euro for each of the outstanding shares (net of the own shares), using, for the necessary amount, the net profit for the year;

to allocate to "Retained earnings" the amount corresponding to the portion of the net profit for the year which remains net of the distribution as per point 2."

The dividend, in compliance with the provisions of the "Regulation of the markets organised and managed by Borsa Italiana S.p.A.", will be paid as follows: ex-dividend date 4 May 2026, record date 5 May 2026, in payment beginning

on 6 May 2026.

The amount of the dividend is fully covered by the profit for the period and sufficient financial funds are already available for the payment.

Provaglio d'Iseo, 12 March 2026

For the Board of Directors

Chairwoman

Maria Chiara Franceschetti

Chief Executive Officer

Marcello Perini

THE GEFRAN GROUP IS EXPOSED

GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS

FINANCIAL STATEMENTS OF GEFRAN S.P.A.

Statement of profit/(loss) for the period

	progressive as at 31 December
(Euro)	Notes	2025	2024
Revenue from product sales	24	80,950,542	75,536,100
of which related parties:	34	45,166,876	43,966,606
Other revenues and income	25	5,188,346	4,769,201
of which related parties:	34	4,091,232	3,902,627
Increases for internal work	9,10	1,937,050	2,068,800
TOTAL REVENUES		88,075,938	82,374,101
Change in inventories	16	(770,245)	(561,756)
Costs for raw materials and accessories	26	(27,308,176)	(25,350,992)
of which related parties:	34	(1,991,426)	(1,639,700)
Service costs	27	(15,597,455)	(14,234,183)
of which related parties:	34	(554,663)	(242,749)
Miscellaneous management costs	28	(444,532)	(682,632)
Other operating income	28	59,181	81,127
Personnel costs	29	(29,482,786)	(27,412,921)
Impairment/reversal of trade and other receivables	16	(64,383)	16,000
Amortisation and impairment of intangible assets	30	(1,740,933)	(1,648,204)
Depreciation and impairment of tangible assets	30	(4,058,515)	(4,078,038)
Depreciation/amortisation total usage rights	30	(326,205)	(296,876)
EBIT		8,341,889	8,205,626
Gains from financial assets	31	5,517,355	5,815,231
of which related parties:	34	4,455,478	4,318,297
Losses from financial liabilities	31	(1,288,693)	(1,592,568)
of which related parties:	34	(257,404)	(434,530)
Value adjustments on non-current assets	31	(230,000)	-
Profit (loss) before tax		12,340,551	12,428,289
Current taxes	32	(2,050,986)	(1,823,712)
Deferred taxes	32	(182,148)	(382,576)
TOTAL TAXES		(2,233,134)	(2,206,288)
NET PROFIT (LOSS) FOR THE PERIOD		10,107,417	10,222,001

Statement of profit/(loss) and other items of comprehensive income

	progressive as at 31 December
(Euro)	Notes	2025	2024
NET PROFIT (LOSS) FOR THE PERIOD		10,107,417	10,222,001
Items that will not subsequently be reclassified in thestatement of profit/(loss) for the period
- revaluation of employee benefits: IAS 19	21	70,343	2,897
- overall tax effect	21	(16,882)	(695)
- equity investments in other companies	14	(32,253)	(114,476)
Items that will or could subsequently be reclassified inthe statement of profit/(loss) for the period
- fair value of cash flow hedging derivatives	20	79,142	(350,770)
Total changes, net of tax effect		100,350	(463,044)
Comprehensive result for the period		10,207,767	9,758,957

Statement of financial position

(Euro)	Notes	31 December2025	31 December2024
NON-CURRENT ACTIVITIES
Intangible assets	9	7,317,155	6,559,638
Property, plant, machinery and tools	10	29,507,739	27,961,277
of which related parties:	34	344,920	198,454
Usage rights	11	706,420	713,279
Equity investments in subsidiaries	12	26,951,172	26,262,508
Equity investments valued at purchase cost	13	4,712,553	712,553
Equity investments in other companies	14	1,784,483	1,810,253
Receivables and other non-current assets	15	-	11,696
Deferred tax assets	32	1,219,784	1,429,183
Non-current financial investments for derivatives	19	5,258	34,026
Non-current financial investments	19	101,604	104,354
TOTAL NON-CURRENT ACTIVITIES		72,306,168	65,598,767
CURRENT ACTIVITIES
Inventories	16	8,462,612	9,232,857
Trade receivables	16	8,897,120	7,400,128
Trade receivables from subsidiaries	16	12,474,725	11,605,054
Other receivables and assets	17	2,410,619	2,894,775
Current tax receivables	18	346,442	260,266
Cash and cash equivalents	19	40,073,946	46,817,593
Financial receivables from subsidiaries	19	785,690	328,034
TOTAL CURRENT ACTIVITIES		73,451,154	78,538,707
TOTAL ASSETS		145,757,322	144,137,474

(Euro)	Notes	31 December2025	31 December2024
SHAREHOLDERS' EQUITY
Share capital	20	14,400,000	14,400,000
Reserves	20	63,775,391	59,559,726
Profit / (Loss) for the year	20	10,107,417	10,222,001
Total Group Shareholders' Equity	20	88,282,808	84,181,727
TOTAL SHAREHOLDERS' EQUITY		88,282,808	84,181,727
NON-CURRENT LIABILITIES
Non-current financial payables	19	11,621,042	16,115,819
Non-current financial payables for IFRS 16 leases	19	405,303	443,894
Non-current financial liabilities for derivatives	19	177,810	310,712
Employee benefits	21	1,392,900	1,511,567
Non-current provisions	22	50,000	-
Deferred tax provisions	32	26,823	12,591
TOTAL NON-CURRENT LIABILITIES		13,673,878	18,394,583
CURRENT LIABILITIES
Current financial payables	19	4,837,210	5,095,926
Current financial payables for IFRS 16 leases	19	314,445	276,819
Financial payables to subsidiaries	20	10,795,408	12,543,558
Trade payables	16	16,654,582	14,199,072
of which related parties:	34	557,939	313,504
Trade payables to subsidiaries	16	586,322	451,427
Current provisions	22	607,849	667,426
Current tax payables	18	886,302	74,013
Other payables and liabilities	23	9,118,518	8,252,923
TOTAL CURRENT LIABILITIES		43,800,636	41,561,164
TOTAL LIABILITIES		57,474,514	59,955,747
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES		145,757,322	144,137,474

Cash flow statement

(Euro /000)	Notes	31 December2025	31 December2024
E) CASH FLOW GENERATED BY (USED IN) FINANCINGACTIVITIES
New financial payables	19	297	-
Repayment of financial debts	19	(5,035)	(9,471)
Increase (decrease) in current financial payables	19	(1,937)	307
Outgoing cash flow due to IFRS 16	19	(344)	(344)
Taxes paid	32	(111)	-
Interest (paid)	31	(718)	(956)
Interest received	31	840	1,388
Dividends received	31	4,421	4,310
Dividends paid	20	(6,107)	(5,965)
TOTAL		(8,694)	(10,731)
F) CASH FLOW FROM CONTINUING OPERATIONS(D+E)		(6,744)	642
G) CASH AND CASH EQUIVALENTS AT THE END OFTHE PERIOD (A+F)		40,074	46,818

(Euro /000)	Notes	31 December2025	31 December2024
(A) CASH AND CASH EQUIVALENTS AT THE START OFTHE PERIOD		46,818	46,176
B) CASH FLOW GENERATED BY (USED IN)OPERATIONS IN THE PERIOD
Net profit (loss) for the period		10,107	10,222
Depreciation, amortisation and impairment	30	6,126	6,023
Provisions (Releases)	17,22,23	1,252	1,395
Capital (gains) losses on the sale of non-currentassets	9,10	50	47
Net result from financial operations	31	(3,998)	(4,222)
Taxes	32	2,233	2,206
Change in provisions for risks and future liabilities	22	(96)	(102)
Change in other assets and liabilities	17,23	(63)	649
Change in deferred taxes	32	24	(111)
Change in trade receivables	16	(2,862)	1,279
Change in inventories	16	(449)	(794)
Change in trade payables	16	2,591	(248)
of which related parties:	34	244	0
TOTAL		14,915	16,344
C) CASH FLOW GENERATED BY (USED IN)INVESTMENT ACTIVITIES
Investments in:
- Property, plant & equipment and intangible assets	9,10	(8,484)	(5,184)
of which related parties:	34	(345)	(198)
- Equity investments and securities	13,14	(4,005)	-
- Acquisitions net of acquired cash	12	(919)	-
- Financial receivables	15	11	(11)
Disposal of non-current assets	10,11	432	224
TOTAL		(12,965)	(4,971)
D) FREE CASH FLOW (B+C)		1,950	11,373

$T_{\rm{H}}$ ng $T_{\rm{H}}$

REPORT ON OPERATIONS – SUSTAINABILITY REPORT

484 485

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

Statement of changes in shareholders' equity

Overall EC reserves

(Euro /000)	Notes	Share capital	Capital reserves	Other reserves	Fair valuemeasurement reserve		Other reserves Retained profit /(loss)	Profit/(loss) for theyear	Total shareholders'equity
Balance at 1 January 2024		14,400	21,926	8,533	298	(291)	24,589	10,932	80,387
Destination of 2023 profit
- Other reserves and provisions	20	-	-	-	-	-	10,932	(10,932)	-
- Dividends	20	-	-	-	-	-	(5,965)	-	(5,965)
Income/(Charges)
acknowledged in	20	-	-	-	(465)	2	-	-	(463)
Shareholders' Equity
Other changes	20	-	-	1	-	-	-	-	1
Profit 2024	20	-	-	-	-	-	-	10,222	10,222
Balance at 31 December2024		14,400	21,926	8,534	(167)	(289)	29,556	10,222	84,182
Destination of 2024 profit
- Other reserves and provisions	20	-	-	8,178	-	-	2,044	(10,222)	-
- Dividends	20	-	-	-	-	-	(6,107)	-	(6,107)
Income/(Charges)
acknowledged in	20	-	-	-	47	53	-	-	100
Shareholders' Equity
Other changes	20	-	-	1	-	-	-	-	1
Profit 2025	20	-	-	-	-	-	-	10,107	10,107
Balance at 31 December2025		14,400	21,926	16,713	(120)	(236)	25,493	10,107	88,283

GEFRAN S.P.A. SEPARATE FINANCIAL STATEMENTS

SPECIFIC EXPLANATORY NOTES TO THE ACCOUNTS OF GEFRAN S.P.A.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

1. Company information

Gefran S.p.A. is incorporated and located in Italy, at Via Sebina 74, Provaglio d'Iseo (BS).

Publication of the financial statements of Gefran S.p.A. for the year ended 31 December 2025 was authorised by resolution of the Board of Directors on 12 March 2026, and they were made available to the public on the Company's website (www.gefran.com) on 31 March 2026.

It should be noted that the information referred to in Article 123-bis of Italian Legislative Decree no. 58/1998 is contained in a separate document, the "Report on Corporate Governance and Ownership Structure", which refers for some information to the "Remuneration Report", prepared pursuant to Article 123-ter of Italian Legislative Decree no. 58/1998. Both reports are published in the section Investor/Governance/Shareholders' meetings of the Company website (www.gefran.com) (https://www.gefran.com/governance/ shareholders-meetings/).

2. Form and content

The annual financial statements of Gefran S.p.A. were prepared in accordance with the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB) as approved by the European Union.

The legal audit is carried out by Deloitte & Touche S.p.A.

These financial statements are presented in euros, which is also the functional currency used for the Group's consolidated financial statements. Unless otherwise indicated, all the amounts included in the Specific explanatory notes to the accounts are expressed in euros.

3. Accounting schedules

Gefran S.p.A. has used:

• / a statement of financial position, according to which assets and liabilities are separated into current and non-current categories;
• / a statement of profit/(loss) for the year, in which costs are categorised by nature;
• / a statement of profit/(loss) for the year and other items of comprehensive

income, which includes charges and income recognised directly in shareholders' equity, net of tax charges;

/ the cash flow statement prepared using the indirect method, which adjusts the net profit for the period to eliminate taxes and the effects of non-monetary transactions, any deferral or allocation from previous or future operating collections or payments, and revenues or costs associated with the cash flows deriving from investment or financing activities; with a view to greater transparency, the Company has chosen to present the cash flow statement in a format that best represents its dynamics, starting with net profit for the period and then eliminating the taxes charged to the income statement, rather than starting with the pre-tax profit.

It should be noted that, with regard to Consob resolution 15519 of 27 July 2006, in the statement of financial position and the income statement, amounts for positions with related parties, if any, are shown separately from the items in question.

4. Measurement criteria

With reference to Consob Communication DEM/11070007 of 5 August 2011, it is also noted that Gefran S.p.A. does not hold in its portfolio any bonds issued by central or local governments or government agencies and is therefore not exposed to risks generated by market fluctuations. The annual financial statements were prepared using the general historical cost criterion, adjusted as required for the measurement of some financial instruments.

With reference to Consob Communication No. 0003907 of 19 January 2015, note 12, "Equity investments in subsidiaries", includes the required information, and specifically the references to external information and the sensitivity analysis.

With reference to Consob communication no. 0007780 of 28 January 2016, it is noted that the impact of market conditions on the information disclosed in the financial statements was considered in the Directors' Report on Operations. We also note that the application of IFRS 13 "Fair value measurement" does not involve significant changes to items in the financial statements for Gefran.

It should also be noted that the Company has applied the amendment "Deferred Tax related to Assets and Liabilities arising from a Single Transaction" issued by the IASB on 7 May 2021 and referring to IAS 12 "Income Taxes". The application takes effect from 1 January 2023 and the effects are recognised from the first comparative year presented (modified retrospective basis), in addition to what is represented in the annual financial report published as at 31 December 2022.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

Finally, with reference to the amendment called "International Tax Reform-Pillar Two Model Rules-Amendments to IAS 12 (the Amendments)" published by the IASB on 23 May 2023, it should be noted that the Pillar Two Model Rules apply to multinational groups with revenues in their consolidated financial statements exceeding 750 million Euro, in at least two of the four previous financial years. For this reason as well, all the amendments related to the so-called "Global Antibase Erosion Model Rules", including the one published by the IASB on 23 May 2023 and aimed at simplifying deferred tax accounting, are not applicable to the Gefran Group.

This section summarises the most significant measurement criteria used by the Company.

REVENUES

According to IFRS 15, revenues are stated up to an amount reflecting the payment the entity expects to be entitled to in exchange for the transfer of assets; no distinctions are made between the supply of goods and of services.

The new principle, which replaced all the current requirements of the IFRS for the posting of revenues, was adopted by the Company without any impact resulting from the change in this principle.

Revenues are stated when the company fulfils an obligation (to sell goods or provide services), transferring goods or services, which are considered to have been transferred from the time at which the customer takes control of the goods or services.

When the result of the contract cannot be reliably measured, the revenue is recognised only to the extent that the costs incurred are recoverable.

INTEREST INCOME

This is recorded as financial income for interest income accrued during the year, using the effective interest rate method, which is the rate that discounts expected future cash flows according to the expected life of the financial instrument, added to the net value of the financial assets reported in the financial statements.

DIVIDENDS

Dividends are recognised when the shareholders' right to receive payment arises, i.e. on the date of the Shareholders' Meeting resolution.

COSTS

Costs for the period are recorded on an accruals basis and recognised net of returns, discounts and allowances.

FINANCIAL CHARGES

Financial charges are recorded in the income statement when they are incurred, in accordance with the reference accounting treatment set forth in IAS 23.

INCOME TAXES

Income taxes for the period are calculated using an estimate of taxable income. The amount owed to the tax authorities is recorded under tax payables. Taxes paid in excess of the amount due are posted to tax receivables.

Current income taxes relating to items posted directly to shareholders' equity are reported directly in shareholders' equity and not in the income statement.

Deferred tax assets and liabilities are determined in relation to timing differences between the values of assets and liabilities in the financial statements and those recognised for tax purposes. Deferred tax assets are recognised when it is probable that sufficient taxable income is available to allow these assets to be used. Deferred tax liabilities are recognised for all taxable timing differences.

TANGIBLE ASSETS

Tangible assets are recognised at purchase cost, including ancillary costs. The cost of tangible assets is adjusted for depreciation on the basis of a systematic plan, taking into account the remaining possibility of economic use of the assets and also considering their physical wear and tear. Tangible assets are depreciated on a monthly basis from the time of entry into operation until they are sold or derecognised in the financial statements.

If significant parts of tangible assets in use have different useful lives, the components identified are recognised and depreciated separately.

At the time of sale or when no future economic benefits are expected from the use of an asset, it is derecognised in the financial statements, and any gain or loss (calculated as the difference between the selling price and the net carrying value) is recognised in the income statement in the year of derecognition.

Costs for maintenance and ordinary repairs are charged

to the income statement in the year in which they are incurred.

Extraordinary maintenance costs that entail significant and tangible improvements to plant production capacity or safety or their economically useful lives are capitalised.

LEASES

In 2018, the competent bodies of the European Union completed the approval process necessary for the adoption of IFRS 16 "Leasing". This new standard replaces the previous IAS 17.

The main change concerns the recognition in the accounts by the lessees which, under IAS 17, were required to make a distinction between a finance lease (recognised in accordance with the discounted cash flow method) and an operating lease (recognised on a straight-line basis). With IFRS 16, the accounting treatment of operating leases is placed on the same footing as finance leases. This standard is applicable from 1 January 2019, and early application was possible, together with the adoption of IFRS 15 "Revenues from contracts with customers". The Group has decided to apply the new standard starting from 1 January 2019, on the basis of what is known as the modified retrospective approach, according to which the value of assets is entered at the value of the financial liabilities; moreover, as permitted by the IASB, practical expedients have been used such as exclusion of contracts with a residual duration of less than 12 months or contracts for which the fair value of the asset falls under the conventional threshold of 5 thousand US Dollars (modest unitary value).

The assets analysed here are entered in the financial statements:

/ in non-current tangible assets as "Right-of-Use

/ under Net Financial Position, while the corresponding financial payable originates current (payable within the year) or non-current (payable beyond a year) "Financial

• assets";
• payables for leases under IFRS 16".

In assessing the fair value and useful lifespan of the assets which are the subject of the contracts covered by IFRS 16, the following factors are taken into consideration:

• / the amount of the periodic lease or rental payments, as defined in the contract and revalued where applicable;
• / initial ancillary costs, if specified in the contract;
• / final restoration costs, if specified in the contract;
• / the number of outstanding instalments;
• / implicit interest, which, if not stated in the contract, is estimated on the basis of the average rates for the Group's debt.

RESEARCH AND DEVELOPMENT COSTS

Research costs are charged to the income statement at the time that they are incurred. Development costs incurred for a specific project are capitalised when all the following conditions are met:

• / the costs can be reliably determined;
• / the technical feasibility of the product can be demonstrated;
• / the anticipated volumes and prices indicate that the costs incurred in the development phase will generate future economic benefits;
• / adequate technical and financial resources are available to complete the development of the project.

Capitalised development costs are amortised on a systematic basis from the start of production and throughout the estimated life of the product. All other development costs are recognised in the income statement when they are incurred.

OTHER INTANGIBLE ASSETS

Other intangible assets acquired or produced internally are recognised as assets in accordance with the provisions of IAS 38, "Intangible assets", when it is probable that the asset will generate future economic benefits and when the cost of the asset can be reliably determined.

The useful life of an intangible asset may be qualified as definite or indefinite. Intangible assets with definite useful lives are amortised on a straight-line basis for the duration of the expected future sales deriving from the related project (usually 5 years). The useful life is reviewed annually and any changes are applied prospectively.

492 493

NON-CURRENT ASSETS HELD FOR SALE

Non-current assets classified as held for sale are measured in accordance with IFRS 5 at the lower of their carrying value and their fair value minus selling costs. The economic effect of these assets also includes taxation.

EQUITY INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES

Investments in subsidiaries, associates and joint ventures are accounted for using the cost method.

ASSET IMPAIRMENT

IAS 36 requires the impairment testing of tangible and intangible assets and equity investments if there are indicators suggesting that such a problem might exist. In the case of goodwill, this test is carried out at least once a year, while intangible assets are tested whenever there are indications of impairment. The recoverability of the asset is assessed by comparing the carrying value recognised in the financial statements with the greater between the net selling price, if an active market exists, and the value in use of the asset.

INVENTORIES

Inventories are valued at the lower of acquisition or production cost and market value. Ancillary costs are included in the acquisition cost.

The following cost configuration is used:

• / raw materials, consumables, products sold: weighted average cost;
• / work in progress: production cost;
• / finished and semi-finished products: production cost.

Production cost includes the cost of raw materials, materials, labour and all other direct production expenses, including depreciation and amortisation. Production cost does not include distribution costs. Obsolete or slow-moving inventories are written down according to the possibility of using or realising them.

TRADE RECEIVABLES AND PAYABLES AND OTHER RECEIVABLES/PAYABLES

Receivables are recognised in the financial statements at their presumed realisable value, consisting of their value adjusted, if necessary, by specific impairment provisions. Trade receivables have due dates that fall within normal contractual periods (30 to 120 days) and are therefore not discounted.

Regarding the introduction of IFRS 9, and particularly the new method for impairment of financial investments, starting on 1 January 2018 the Group revised its method for determination of the reserve to be used for coverage of losses on receivables, taking into account the losses expected throughout the life of the receivable, as required by the new standard, with no significant impact on the result for the period or on equity resulting from application of IFRS 9.

Receivables factored without recourse are removed from the financial statements when all the risks associated with the sale of the receivable are borne by the factoring company.

Payables are stated at amortised cost. Trade payables have due dates that fall within normal contractual periods (60 to 120 days) and are therefore not discounted.

FINANCIAL DERIVATIVES

Derivatives are classified as "Hedging transactions" if the conditions exist for the application of hedge accounting; otherwise, even if undertaken with the intention of managing risk exposure, they are recorded as "Financial assets held for trading". Financial derivatives may be recognised using the methods established for hedge accounting only when the relationship between the derivative and the hedged item is formally documented and the hedge effectiveness is high (effectiveness test). The effectiveness of hedge transactions is documented both at the start of the transaction and periodically (at least at each reporting date of the financial statements or interim statements) and measured by comparing changes in the fair value of the hedging instrument with those of the hedged item.

When hedging transactions hedge the risk of changes in the fair value of hedged instruments (fair value hedges), derivatives are recognised at fair value and the effects are charged to the income statement. Gefran does not hold derivatives of this kind.

When derivatives hedge the risk of changes in the cash flows of the hedged instruments (cash flow hedges), changes in the fair value of the derivatives are initially recorded under other items of comprehensive income and are then reclassified from shareholders' equity to profit (loss) for the period as a reclassification adjustment, in line with the economic effects of the hedged transaction. The change in fair value relating to the ineffective portion is recognised immediately in the income statement for the period. If the derivative is sold or no longer qualifies as an effective hedge against the risk for which it was initiated, or the occurrence of the underlying transaction is no longer regarded as highly probable, the portion of the cash flow hedge reserve relating thereto is immediately reversed to the income statement.

It is believed that all existing hedges currently designated as effective hedges continue to qualify for hedge accounting under IFRS 9. As IFRS 9 does not alter the general principle on the basis of which an entity registers effective hedging, the Company has not felt any significant impact of application of this principle.

The Gefran S.p.A uses financial derivatives such as Interest Rate Swaps (IRS) and Interest Rate Caps (CAP). Changes in the fair value of derivatives that do not qualify for hedge accounting are recognised in the income statement. Regardless of classification, all derivatives are measured at fair value using valuation techniques based on market data (such as, inter alia, discounted cash flow, the forward exchange rate method and the Black-Scholes formula and its developments).

CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash on hand and demand and short-term bank deposits, which are highly liquid and subject to an insignificant risk of changes in value. These are stated at their presumed realisable value.

FINANCIAL LIABILITIES

Payables and financial liabilities are initially recorded at fair value, which essentially coincides with the amount to be paid, net of transaction costs. Purchases and sales of financial liabilities are recognised on the trading date, i.e. the date on which the Company committed to purchase/sell the liabilities.

Management determines the classification of financial liabilities in the categories identified at the time of their initial recognition. After initial recognition, financial liabilities are valued in relation to their classification within one of these categories. In detail, it is highlighted that:

• / the valuation of "Financial liabilities at fair value through profit or loss" is carried out using the market value at the close of the reporting period; in the case of unlisted instruments (e.g. financial derivatives) it is carried out using financial valuation techniques based on market data. Gains or losses arising from fair value measurement relating to assets and liabilities held for trading are recognised in the income statement;
• / the valuation of "Financial liabilities valued at amortised cost", carried out at amortised cost, in the case of instruments maturing within 12 months uses the nominal value as an approximation of amortised cost.

Payables denominated in foreign currencies are adjusted to year-end exchange rates and gains or losses resulting from the adjustment are recognised in the income statement.

It is believed that all existing hedges currently designated as effective hedges continue to qualify for hedge accounting under IFRS 9.

OWN SHARES

Own shares are reported as a reduction of shareholders' equity in a specific reserve. The original cost of the own shares and the income generated by any subsequent sales are recognised as changes in shareholders' equity.

PROVISIONS FOR RISKS AND FUTURE LIABILITIES

Allocations to provisions for risks and future liabilities take place when the Company has a current obligation (legal or implicit) arising from a past event, it is probable that a financial outlay will take place to meet the obligation and a reliable estimate can be made of the obligation.

Allocations to provisions for risks and future liabilities exceeding one year are discounted only if the effect of discounting is material, at a pre-tax discount rate that reflects current market assessments of the value of money in relation to time and, if appropriate, the specific risks associated with the liability. When discounting back takes place, the increase in the provision due to the passage of time is recognised as a financial charge.

DISCLOSURE OF RISKS AND UNCERTAINTIES TO WHICH THE GEFRAN GROUP IS EXPOSED

494 495

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

EMPLOYEE BENEFITS AND NON-COMPETITION AGREEMENTS

The post-employment benefit reserve, which is mandatory for Italian companies pursuant to Italian Law 297/1982, is considered a defined benefit plan and is based, inter alia, on the working lives of employees and the remuneration earned by the employee over a predetermined period of service. The post-employment benefit reserve is calculated by independent actuaries using the "Traditional Unit Credit Method". The Company has opted to recognise all cumulative actuarial gains and losses both on first-time adoption of IFRS and subsequently.

This item is also used to recognise non-competition agreements, signed with some employees to protect the company from any competitive activities; the value of the obligation is the subject of actuarial valuation and, when first recognised, the portion of the provision determined by actuarial methods is posted to the statement of profit/(loss) for the year.

TRANSLATION OF FOREIGN CURRENCY ITEMS

Foreign currency transactions are implemented by each entity at the conversion rate prevailing at the accounting date. Subsequently, at the time of payment or collection, the exchange rate difference arising from the time difference between the two moments is recorded and posted to the income statement.

From an equity point of view, at the close of the reporting period, receivables and liabilities arising from transactions in currencies other than the functional currency are reassessed in the company's currency, taking as benchmark the exchange rate prevailing at the reporting date. Also in this case, the exchange rate difference is posted to the income statement.

Non-monetary items denominated in foreign currencies are translated into the functional currency at the exchange rate prevailing at the transaction date, i.e. at the historical exchange rate.

5. Accounting standards, amendments and interpretations applied since 1 January 2025

Please refer to Note 7 of the Specific explanatory notes to the consolidated financial statements for this analysis.

6. Accounting standards, amendments and interpretations not yet applicable or not applied in

advance

Please refer to Note 8 of the Specific explanatory notes to the consolidated financial statements for this analysis.

7. Main decisions in the application of accounting standards and uncertainties when making

estimates

In drafting the financial statements and the explanatory notes to the accounts, in accordance with the IAS/IFRS principles, the Company makes use of estimates and assumptions to assess certain items. These are based on historical experience and uncertain but realistic assumptions that are assessed regularly and, if necessary, updated, with effect on the income statement for the period and prospectively. The uncertainty inherent in these assessments may lead to misalignment between the estimates made and recognition in the financial statements of the actual effects of the forecasted events.

Below are the processes that require Management to perform assessment estimates, and with regard to which a change in the underlying conditions might have a significant impact on the consolidated financial data.

INVENTORY ALLOWANCE

Inventories are stated at their purchase cost (measured using the weighted average cost method) or, if lower, their net realisable value. The inventory allowance is needed to align the value of inventories with their estimated realisable value: inventories are analysed to identify slow-moving items, so as to recognise a provision that reflects their potential obsolescence.

PROVISION FOR DOUBTFUL RECEIVABLES

The provision for doubtful receivables reflects Management's estimates regarding the recoverability of receivables from customers. Management's assessment is based on past experience and an analysis of situations faced with known or probable collection risks.

Regarding the introduction of IFRS 9, and particularly the new method for impairment of financial investments, the Company adopts the method for determination of the reserve to be used for coverage of losses on receivables, taking into account the losses expected throughout the life of the receivable, as required by the new standard.

GOODWILL AND INTANGIBLE ASSETS WITH AN INDEFINITE LIFE

These are measured periodically using impairment tests, with the aim of determining their present value and recognising any differences with respect to their carrying amounts; for details, see the specific notes to the financial statements.

EMPLOYEE BENEFITS AND NON-COMPETITION AGREEMENTS

The provisions for post-employment benefits and non-competition agreements are recorded in the financial statements and remeasured annually by external actuaries who inter alia make assumptions about the discount rate, inflation and demographic assumptions; for details, see the specific note to the financial statements.

DEFERRED TAX ASSETS

The recoverability of deferred tax assets is periodically evaluated, based on the results achieved and on the industrial plans prepared by Management.

CURRENT AND NON-CURRENT PROVISIONS

Provisions are made for risks that will probably have an adverse outcome. The provisions recorded in the financial statements reflect management's best estimate of the risk at that time. This estimate entails the adoption of assumptions that depend on factors that may change over time and that could, therefore, have a significant effect on the current estimates made by management in preparing the Company's financial statements.

These may be divided into current funds, when the financial outlay is planned to take place by the end of the year, and non-current provisions, if the financial outlay is planned beyond 12 months.

8. Management of financial risks

The Company's activities are exposed to different types of risk: market risk (including exchange rate risks, interest rate risks and price risks), credit risk and liquidity risk. The Company's risk management strategy focuses on the markets' unpredictability and is intended to minimise the potential negative effects on Gefran S.p.A.'s results. Certain types of risk are mitigated through the use of derivatives. Coordination and monitoring of the main financial risks are centralised in the Group's Finance and Administration Department, as well as the Purchasing function as regards price risk, in close partnership with the Company's operating units. Risk management policies are approved by the Administration, Finance and Control Director, which provides written guidelines for the management of the risks listed above and the use of derivative and non-derivative financial instruments. In the context of the sensitivity analyses described below, the effect on net profit and shareholders' equity is determined gross of the tax effect.

EXCHANGE RATE RISKS

Gefran S.p.A. is exposed to the risk of changes in the Euro/USD exchange rate for business transactions and cash held in a currency other than the functional currency of the Company (euro). The value of revenues denominated in a currency other than the functional currency in 2025 is about 5% (in line with the figure of 2024).

As of 31 December 2025 the Company had 1,055 thousand dollars US in receivables and 615 thousand dollars US in payables (as of 31 December 2024, it had 1,113 thousand dollars in receivables and 440 thousand dollars

in payables).

Sensitivity to a hypothetical, unfavourable and immediate change of 5% and 10% in exchange rates, with other variables remaining unchanged, would have the following impact on the fair value of financial assets and liabilities

held in USD.

u.s. dollar
Total

Total
U.S. dollar
(Euro /000)

(Euro /000)	31 December 2025			31 December 2024
	-5%	+5%	-5%	+5%
U.S. dollar	20	(18)	34	(31)
Total	20	(18)	34	(31)

(Euro /000)		31 December 2025		31 December 2024
	-10%	+10%	-10%	+10%
U.S. dollar	42	(34)	72	(59)
Total	42	(34)	72	(59)

INTEREST RATE RISK

The interest rate risk to which the Company is exposed mainly originates from financial payables with a variable rate (totalling 15,876 thousand Euro as at 31 December 2025 and 20,791 thousand Euro as at 31 December 2024). Variable rate loans expose the Company to a risk associated with interest rate volatility (cash flow risk). In this regard, the Administration and Finance Department monitors the exposure to interest rate risk and proposes appropriate hedging strategies to contain the exposure within the limits defined

and agreed in internal policies, using derivatives, Interest Rate Swaps (IRS) and Interest Rate Caps (CAP) when necessary.

The table below shows a sensitivity analysis of the impact that an interest rate increase/decrease of 100 basis points would have on net operating profit (loss), comparing interest rates at 31 December 2025 and 31 December 2024, while keeping other variables unchanged.

(Euro /000)		31 December 2025		31 December 2024
	(100)	100	(100)	100
Euro	401	(401)	468	(468)
Total	401	(401)	468	(468)

The potential impacts shown above are calculated with reference to the net liabilities that account for the most significant portion of Gefran S.p.A.'s debt on the reporting date, and measuring, on this amount, the effect on net financial charges resulting from the change in interest rates on an annual basis.

The net liabilities considered in this analysis include variable rate financial receivables and payables, cash and cash on hand and financial derivatives, the value of which is affected by interest rate fluctuations.

The table below shows the carrying value at 31 December 2025, broken down by maturity, of the Company's financial instruments exposed to interest rate risk.

(Euro /000)	<1 year		1 - 5 years >5 years old	Total
Loans due	4,792	11,621	-	16,413
Financial payables due to leasing under IFRS 16	314	383	22	719
Other accounts payable	45	-	-	45
Cash pooling current account overdrafts	10,795	-	-	10,795
Total liabilities	15,946	12,004	22	27,972
Cash in current accounts	40,067	-	-	40,067
Cash in cash pooling current accounts	786	-	-	786
Total assets	40,853	-	-	40,853
Total variable rate	24,907	(12,004)	(22)	12,881

By contrast with the analysis of the Net financial position, the amounts shown in the table above exclude the fair value of derivatives (positive by 173 thousand Euro), cash on hand (positive by 7 thousand Euro) and other non-current assets that include financial pre-paid expenses and bond coupons (total 102 thousand Euro).

The table below shows the carrying value at 31 December 2024, broken down by maturity, of the Company's financial instruments exposed to interest rate risk.

(Euro /000)	<1 year		1 - 5 years >5 years old	Total
Loans due	5,035	16,116	-	21,151
Financial payables due to leasing under IFRS 16	277	444	-	721
Other accounts payable	60	-	-	60
Cash pooling current account overdrafts	12,544	-	-	12,544
Total liabilities	17,916	16,560	-	34,476
Cash in current accounts	46,812	-	-	46,812
Cash in cash pooling current accounts	328	-	-	328
Total assets	47,140	-	-	47,140
Total variable rate	29,224	(16,560)	-	12,664

By contrast with the analysis of the Net financial position, the amounts of 2024 shown in the table above exclude the fair value of derivatives (negative by 277 thousand Euro), cash on hand (positive by 6 thousand Euro) and financial pre-paid expenses and bond coupons (totalling 104 thousand Euro).

LIQUIDITY RISK

Prudent management of the liquidity risk arising from the Company's normal operations requires an appropriate level of cash on hand and short-term securities to be maintained, as well as the availability of funds obtainable through an appropriate amount of committed credit lines.

The Administration and Finance Department monitors forecasts on the use of the Company's liquidity reserves based on expected cash flows. The table below shows the amount of cash reserves on the reference dates.

(Euro /000)	31 December 2025	31 December2024	Change
Cash and cash equivalents	7	6	1
Cash in bank deposits	40,067	46,812	(6,745)
Total liquidity	40,074	46,818	(6,744)
Multiple mixed credit lines	19,450	19,450	-
Cash flexibility credit lines	3,100	3,100	-
Invoice factoring credit lines	2,000	2,000	-
Total credit lines available	24,550	24,550	-
Total available liquidity	64,624	71,368	(6,744)

To complete disclosure on financial risks, the table below shows a reconciliation of financial asset and liability classes, as identified in the Company's statement of financial position, and the types of financial assets and liabilities identified on the basis of IFRS 7 requirements.

(Euro /000)	Level 1	Level 2	Level 3	Total
Available-for-sale assets valued at fair value:
Shareholdings valued at fair value with a balancing itemin other overall	169	-	1,615	1,784
Hedging transactions	-	5	-	5
Total assets	169	5	1,615	1,789
Hedging transactions	-	(178)	-	(178)
Total liabilities	-	(178)	-	(178)

Below is a reconciliation of financial asset and liability classes, as identified in the Gefran S.p.A. statement of financial position, and the types of financial assets and liabilities identified on the basis of IFRS 7 requirements, for the year 2024:

(Euro /000)	Level 1	Level 2	Level 3	Total
Available-for-sale assets valued at fair value:
Shareholdings valued at fair value with a balancing item
in other overall	201	-	1,609	1,810
Hedging transactions	-	34	-	34
Total assets	201	34	1,609	1,844
Hedging transactions	-	(311)	-	(311)
Total liabilities	-	(311)	-	(311)

Level 1: Fair values represented by the prices - listed in active markets (unadjusted) - of financial instruments identical to those being valued that may be accessed at the measurement date. These prices are defined as markto-market inputs as they provide a fair value measurement based directly on official market prices, therefore without the need for any modification or adjustment. The change compared to the value at 31 December 2024 corresponds to the equity investment Woojin Plaimm Co Ltd, the value of which decreased by 32 thousand Euro.

Level 2: Fair values determined using measurement techniques based on variables that may be observed in active markets, which in this case include the measurement of interest rate and exchange rate hedges. As with the Level 1 inputs, the reference value is mark-to-market, i.e. the evaluation method whereby the value of a financial instrument or contract is systematically adjusted according to the current market prices.

Level 3: Fair values determined using measurement techniques based on market variables that may not be observable, which in particular refer to equity investments in other companies not listed on international markets. This item mainly relates to the shareholding in Colombera S.p.A. (1,582 thousand Euro).

CREDIT RISK

The Company deals mainly with known and reliable customers. Gefran S.p.A.'s credit policy is to subject customers who require extended payment terms and new customers to credit checks. In addition, receivables are monitored over the year to reduce late payments and prevent significant losses.

Gefran S.p.A. adopted a policy of monitoring outstanding receivables, a measure made necessary given the possible deterioration of certain receivables, the decline in credit rating reliability and the lack of liquidity on the market. The impairment process conducted on the basis of the Group's procedures requires receivables to be written down by a percentage which depends on the time range of the outstanding receivable, in view of past experience in specific lines of business and geographical regions, as required by IFRS 9.

Below are the values of gross trade receivables at 31 December 2025 and 31

December 2024.

(Euro /000)	Totalvalue	Notoverdue	Overdueby up to 2months	Overdueby 2 to 6months	Overdueby 6 to 12months	Overdueby morethan 12months	Receivablesindividuallywritten down
Gross trade receivablesat 31 December 2025	9,562	8,744	116	67	3	-	632
Gross trade receivablesat 31 December 2024	8,009	7,388	12	-	-	-	609

Gefran S.p.A. has established formal procedures for customer credit and credit collection through the credit department and in partnership with leading external law firms. All the procedures put in place are intended to reduce credit risk. The exposure to other forms of credit, such as financial receivables, is monitored constantly and reviewed monthly, or at least quarterly, in order to identify any losses or collection risks.

The Company has not assigned portions of its trade receivables to factoring companies, transferring the insolvency risk.

RISK OF CHANGE IN RAW MATERIAL PRICES

Since Gefran S.p.A.'s production mainly involves mechanical, electronic and assembly processes, exposure to energy price fluctuations is limited. The Company is exposed to changes in basic commodity prices (e.g. metals) to a small extent, given the product cost component related to these materials is very limited.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

The purchase prices of key components are usually agreed with counterparties for the full year and reflected in the budget. The structured and formalised governance systems adopted by the Company mean that the margins earned can be analysed periodically.

As regards the recent rise in prices, also related to developments in the geo-political situation, key factors were in-depth knowledge of the product and the synergy between the various company areas, which made it possible to promptly navigate new technological roads, broaden the spectrum of choices and introduce new supply opportunities, in order to mitigate the effect of rising prices.

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

All Gefran S.p.A.'s financial instruments are recorded in the financial statements at fair value. The amount of financial liabilities valued at amortised cost is considered close to the fair value on the reporting date. The table below summarises Gefran's net financial position, comparing fair value and carrying value.

		carrying value		fair value
(Euro /000)	2025	2024	2025	2024
Financial assets
Cash and cash equivalents	7	6	7	6
Cash in bank deposits	40,853	47,140	40,853	47,140
Financial investments for
derivatives	5	34	5	34
Non-current financial investments	102	104	102	104
Total financial assets	40,967	47,284	40,967	47,284
Financial liabilities
Current portion of long-term debt	(4,792)	(5,035)	(4,792)	(5,035)
Financial liabilities for derivatives	(178)	(311)	(178)	(311)
Payables due to leasing contracts
under IFRS 16	(719)	(721)	(719)	(721)
Other financial payables	(10,840)	(12,604)	(10,840)	(12,604)
Non-current financial debt	(11,621)	(16,116)	(11,621)	(16,116)
Total financial liabilities	(28,150)	(34,787)	(28,150)	(34,787)
Total net financial position	12,817	12,497	12,817	12,497

9. Intangible assets

The item "Intangible assets" includes only assets with a definite lifespan, and decreased from 6,560 thousand Euro on 31 December 2024 to 7,317 thousand Euro on 31 December 2025. The item breaks down as follows:

Historical cost					31 December 2024 Increases Decreases Reclassifications 31 December 2025
(Euro /000)
Development costs	16,313	753	-	2,265	19,331
Intellectual property rights	7,147	148	-	25	7,320
Assets in progress and
payments on account	2,859	906	-	(2,403)	1,362
Other assets	7,601	707	-	97	8,405
Total	33,920	2,514	-	(16)	36,418

Accumulateddepreciation					31 December 2024 Increases Decreases Reclassifications 31 December 2025
(Euro /000)
Development costs	13,409	1,294	-	-	14,703
Intellectual property rights	6,657	303	-	-	6,960
Other assets	7,294	144	-	-	7,438
Total	27,360	1,741	-	-	29,101

Net value	31 December 2024	31 December 2025	Change
(Euro /000)
Development costs	2,904	4,628	1,724
Intellectual property rights	490	360	(130)
Assets in progress and
payments on account	2,859	1,362	(1,497)
Other assets	307	967	660
Total	6,560	7,317	757

The net carrying value of development costs includes the capitalisation of

costs incurred for the following activities:

/ 1,079 thousand Euro for the sensors segment, referring to lines for mobile hydraulics, pressure transducers (KS and KH in miniaturized version), non-contact linear transducers (WP-WR, WPA/WPP I/O LINK, RTE Profinet, TWIIST technology), pressure and melt (KMC, I/O LINK technology);

/ 3,549 thousand Euro referring to the component lines for the new ranges of regulators (850-1650-1850-2850), power control (GRS, GRZ, GRP, GPC, G-Start) and programmable automation (G-Mation, Gilogik3, GF Project).

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

These assets are considered to have a useful life of 5 years.

Intellectual property rights consist exclusively of costs incurred to purchase the Company's IT system management programs and the use of licences for third-party software, as well as patents.

Assets in progress and payments on account include payments on account made to suppliers to purchase software programs and licences expected to be delivered during the next year, and purchase of patents for technologies currently being developed. This item also includes 1,144 thousand Euro in development costs, of which 313 thousand Euro for the automation components business and 831 thousand Euro for the sensors business unit, the benefits of which will be reflected the income statement from next year, so they have not been amortised.

The item other assets mostly includes the costs incurred both in the course of previous years as well as in the current one, to implement ERP SAP, Business Intelligence (BW), Customer Relationship Management (CRM) and other management software programmes. These assets have a useful life of 5 years.

The increases in the historical value of "Intangible assets", amounting to 2,514 thousand Euro in 2025, include 1,891 thousand Euro linked to capitalisation of internal costs (2,024 thousand Euro in 2024).

The changes over the year 2024 are as follows.

10. Property, plant, machinery and

tools

"Property, plant, machinery and tools" came to 29,508 thousand Euro, compared with 27,961 thousand Euro at 31 December 2024. The change is shown

in the table below:

Historical cost	31 December			2024 Increases Decreases Reclassifications	31 December2025
(Euro /000)
Land	3,002	-	-	-	3,002
Industrial buildings	27,944	487	(1)	11	28,441
Plant and machinery	37,779	2,002	(562)	835	40,054
Industrial and
commercial	17,349	481	(201)	352	17,981
equipment
Other assets	3,974	154	(63)	97	4,162
Assets in progress and
payments on account	1,407	2,846	-	(1,277)	2,976
Total	91,455	5,970	(827)	18	96,616

Accumulateddepreciation
(Euro /000)
Industrial and
commercial
equipment

Accumulateddepreciation	31 December			2024 Increases Decreases Reclassifications	31 December2025
(Euro /000)
Industrial buildings	16,438	709	-	-	17,147
Plant and machinery	28,204	2,282	(201)	-	30,285
Industrial and
commercial	15,679	811	(182)	-	16,308
equipment
Other assets	3,173	257	(62)	-	3,368
Total	63,494	4,059	(445)	-	67,108

Net value	31 December 2024	31 December 2025	Change
(Euro /000)
Land	3,002	3,002	-
Industrial buildings	11,506	11,294	(212)
Plant and machinery	9,575	9,769	194
Industrial and
commercial equipment	1,670	1,673	3
Other assets	801	794	(7)
Assets in progress and
payments on account	1,407	2,976	1,569
Total	27,961	29,508	1,547

Historical cost	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Development costs	15,544	64	-	705	16,313
Intellectual propertyrights	6,888	223	-	36	7,147
Assets in progress andpayments on account	1,551	2,073	-	(765)	2,859
Other assets	7,526	51	-	24	7,601
Total	31,509	2,411	-	-	33,920

Accumulateddepreciation	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Development costs	12,264	1,145	-	-	13,409
Intellectual propertyrights	6,333	324	-	-	6,657
Other assets	7,115	179	-	-	7,294
Total	25,712	1,648	-	-	27,360

		Change
		(376)
		(65)
		1,308
		(104)
5,797	6,560	763
	31 December 20233,2805551,551411	31 December 20242,9044902,859307

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

٠	valu

The biggest changes during the current period related to:

• / machinery and equipment (production and laboratory) for the Group's Italian plants totalling 2,989 thousand Euro, of which 2,116 thousand Euro for the production departments of the sensors business and 873 thousand Euro for the automation components business lines (at 31 December 2024 invested a total of 1,702 thousand Euro, of which 853 thousand Euro for the production lines of the automation components and 849 thousand Euro for the sensors lines);
• / adaptation of industrial buildings, for 2,824 thousand Euro, of which 1,870 thousand Euro for the upgrading of the area hosting the operational activities of the automation components division and headquarters (in 2024, a total of 737 thousand Euro);
• / investment in renewal of electronic office machines and Information Technology systems equipment used for 157 thousand Euro (335 thousand Euro in 2024).

The increases in the historical value of "Property, plant, machinery and tools", which amounted to 5,970 thousand Euro in 2025, include 45 thousand Euro linked to capitalisation of internal costs (45 thousand Euro in 2024).

The changes relating to 2024 are as follows:

Historical cost	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Land	3,002	-	-	-	3,002
Industrial buildings	27,520	133	-	291	27,944
Plant and machinery	36,298	980	(616)	1,117	37,779
Industrial and	16,936	412	(181)	182	17,349
commercial equipment
Other assets	3,705	249	(14)	34	3,974
Assets in progress and
payments on account	2,031	999	1	(1,624)	1,407
Total	89,492	2,773	(810)	-	91,455

Accumulateddepreciation	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Industrial buildings	15,700	737	-	1	16,438
Plant and machinery	26,284	2,368	(449)	1	28,204
Industrial and
commercial equipment	15,104	747	(171)	(1)	15,679
Other assets	2,961	226	(13)	(1)	3,173
Total	60,049	4,078	(633)	-	63,494

Net value	31 December2023	31 December2024	Change
(Euro /000)
Land	3,002	3,002	-
Industrial buildings	11,820	11,506	(314)
Plant and machinery	10,014	9,575	(439)
Industrial and commercial equipment	1,832	1,670	(162)
Other assets	744	801	57
Assets in progress and payments on account	2,031	1,407	(624)
Total	29,443	27,961	(1,482)

11. Right-of-Use assets

This item reflects entry of the value of assets covered by lease contracts, according to accounting standard IFRS 16. The value of "Right-of-use assets" at 31 December 2025 amounts to 706 thousand Euro, and shows the following changes:

Historical cost				31 December 2024 Increases Decreases Reclassifications 31 December 2025
(Euro /000)
Vehicles	1,915	251	(750)	-	1,416
Machinery and
equipment	78	66	-	-	144
Total	1,993	317	(750)	-	1,560

Accumulateddepreciation				31 December 2024 Increases Decreases Reclassifications 31 December 2025
(Euro /000)
Vehicles	1,225	306	(752)	-	779
Machinery andequipment	55	20	-	-	75
Total	1,280	326	(752)	-	854

Net value	31 December 2024	31 December 2025	Change
(Euro /000)
Vehicles	690	637	(53)
Machinery and equipment	23	69	46
Total	713	706	(7)

As of 1 January 2025, the Group had a total of 79 contracts in place for leasing of vehicles, machinery, industrial equipment and electronic office machinery, as well as for rental of real estate. Practical expedients allowed by the IASB have been employed, such as excluding contracts with a residual duration of

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

less than 12 months and contracts for assets whose fair value is below the conventional threshold of 5 thousand US dollars (modest unit value).

Overall, 79 contracts were active at 31 December 2025, including:

• / 71 of them falling within the scope of application of IFRS 16 (65 for car rental and 6 for machinery);
• / 8 are excluded from the scope of application of the standard and 7 of them have a duration of less than 12 months.

The increases in the historical cost include the effect of adjusting contracts that have been extended or for which new conditions have been defined. In particular, they refer to vehicles, totalling 251 thousand Euro, for extensions of existing contracts and to 11 new vehicle leasing agreements signed by the Company in 2025 (part of which in respect of expired agreements), and to equipment in the amount of 66 thousand Euro, for extensions of existing contracts.

The historical cost decreases recorded during 2025, amounting to 750 thousand Euro, essentially relate the write-off of vehicle rental agreements that expired before 31 December 2024, with zero carrying value, leading to a decrease in the historical cost and, in equal measure, the related depreciation provision.

The changes compared to 2024 are shown in the table below.

Historical cost	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Vehicles	1,675	412	(172)	-	1,915
Machinery and	57	21	-	-	78
equipment
Total	1,732	433	(172)	-	1,993

Accumulateddepreciation	31 December			2023 Increases Decreases Reclassifications	31 December2024
(Euro /000)
Vehicles	1,039	287	(101)	-	1,225
Machinery and
equipment	45	10	-	-	55
Total	1,084	297	(101)	-	1,280

Net value	31 December 2023	31 December 2024	Change
(Euro /000)
Vehicles	636	690	54
Machinery and
equipment	12	23	11
Total	648	713	65

12. Equity investments in subsidiaries

The item "Equity investments in subsidiaries" amounted to 27,181 thousand Euro as of 31 December 2025, and the balance breaks down as follows:

(Euro /000)		Shareholding 31 December2025	31 December2024	Change
Gefran Deutschland GmbH (Germany)	100.00%	365	365	-
Gefran Brasil Elettroel. Ltda (Brazil)	100.00%	2,924	2,924	-
Gefran UK Ltd (United Kingdom)	100.00%	5,141	5,141	-
Gefran Soluzioni S.r.l. (Italy)	100.00%	1,012	1,012	-
Gefran Schweiz AG (Svizzera)	100.00%	4,123	4,123	-
Gefran Benelux NV (Belgium)	100.00%	344	344	-
Gefran Inc (U.S.)	100.00%	7,848	7,848	-
Gefran France SA (France)	99.99%	4,338	4,338	-
Gefran Asia Pte Ltd (Singapore)	100.00%	2,883	2,883	-
Gefran India Private Ltd (India)	100.00%	1,722	1,723	(1)
CZ Elettronica S.r.l. (Italy)	100.00%	919	-	919
Adjustment provision		(4,668)	(4,438)	(230)
Total		26,951	26,263	688

The following is a breakdown of the adjustment provision.

(Euro /000)	31 December2025	31 December2024	Change
Gefran UK Ltd (United Kingdom)	4,438	4,438	-
Gefran Schweiz AG (Svizzera)	230	-	230
Total	4,668	4,438	230

Changes in the adjustment provision recorded in 2025 relate to the adjustment to the value of the equity investment in the subsidiary Gefran Schweiz AG (no changes were recorded in 2024).

Pursuant to IAS 36, the amount recognised in the financial statements is reviewed if any indicators of potential impairment appear.

When determining value in use, specific cash flows deriving from the Group Plan for the period 2026 - 2028 were considered, along with terminal value, representing ability to generate cash flows beyond the explicit forecast time horizon.

The main assumptions that Management used to calculate the value in use regard the discount rate (Weighted Average Cost of Capital - WACC) and the

510 511

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

long-term growth rate (known as g rate), as well as the cash flows deriving from the Group Plan.

The rate used for discounting future cash flows is the weighted average cost of capital (WACC), as calculated at the end of 2025, determined by the weighted average of the cost of own capital and the cost of third-party capital, net of the effect on taxation.

When calculating the same, market parameters were used such as the "beta" (a factor expressing the risk which characterises the particular business with respect to the financial market in general) and the related financial structure, taken from calculations developed by Professor Damodaran, one of the leading experts in business valuations globally. In addition, an "alpha" coefficient was applied to the cost of own capital to represent a prudent discretionary factor reflecting specific non-systematic risks not already identified by the traditional model.

The return on risk-free assets was benchmarked to the average monthly yield in the last six months of 2025 on government bonds of countries in which the Group and the CGUs operate.

The premium for market risk represents the additional return required by a risk-averse investor, compared with the return that can be obtained from risk-free assets: it is attributable to the difference between the long-term normalised return of the share market and the risk-free assets rate. For this component, the reference used for all CGUs, regardless of the geographical region of reference, was the so-called global value, according to Professor Damodaran's calculations, so as to reduce the volatility of the component from one year to the next.

In order to establish the terminal value, the long-term growth rate of the cash flows adopted has been defined in relation to the expected levels of inflation in the various geographical regions in which the Group operates, referring to estimates of international bodies.

The general change in the WACC at consolidated level between 2025 and 2024 is mainly related to the decrease in the "risk-free" rate and the decrease in the "cost of debt" as well as the change in the "beta" coefficient.

Applying sensitivity analysis to the Group's impairment test, we find that break-even WACC, that is, the discount rate that would make value in use the same as the value of net invested capital, is 16.50%, significantly higher than the current discount rate. Note that in 2024 this rate was 19.58%.

The recoverable amount of goodwill was determined according to the calculation of the value in use, which used projections of the three-year cash flow based on the 2026 - 2028 Plan approved by Management. The cash flows in the Group Plan include application of the IFRS 16 accounting standard, the effects of which are reflected in the WACC applied, as the average ratio between equity and financial debt is influenced by the adoption of this principle.

The final outcome of the impairment testing on the book values of the equity investments was an equity value (enterprise value net of the corresponding net financial position) lower than the book value, therefore steps were taken to adjust, in the negative, the book value of the equity investment relating to the subsidiary Gefran Schweiz AG, for a value of 230 thousand Euro.

With reference to the other equity investments in subsidiaries, the related carrying values recorded in the financial statements have been maintained.

13. Equity investments valued at purchase cost

The item amounted to 4,713 thousand as at 31 December 2025, and breaks

down as follows:

(Euro /000)			31 December 2025 31 December 2024	Change
Axel S.r.l.	Shareholding	15.00%	15.00%
Via del Cannino, 3	Investment value	137	137	-
Crosio della Valle (VA)	Adjustment provision	-	-	-
	Net value	137	137	-
Robot At Work S.r.l.	Shareholding	24.83%	-
Via Primo Maggio, 40/E	Investment value	576	576	-
Rovato (BS)	Adjustment provision	-	-	-
	Net value	576	576	-
40Factory S.r.l.	Shareholding	22.00%	-
Via Vittore Calligari, 21	Investment value	4,000	-	4,000
Piacenza (PC)	Adjustment provision	-	-	-
	Net value	4,000	-	4,000
Total		4,713	713	4,000

As described in the paragraph Significant events in 2025, in the course of the first quarter of 2025 Gefran S.p.A. purchased a 22% minority stake in 40Factory S.r.l., a tech scale-up with operational headquarters in Piacenza that offers manufacturers of industrial machines and end-users an Industrial loT (Internet of Things) platform for the collection and use of plant data. The equity investment is recorded at 4,000 thousand Euro.

(Euro /000)	Netcarryingvalue31 Dec2025	Netcarryingvalue31 Dec2024	Explicitforecast	Wacc(%)	Equityvalue31 Dec2025	Risk free(%)	Riskpremium(%)	Theoreticaltax rate (%)
Gefran SchweizAG (Svizzera)	3,893	4,123	2026- 2028	6.7%	3,896	0.3%	5.5%	16.3%
Gefran UK Ltd(United Kingdom)	703	703	2026- 2028	9.6%	1,957	4.6%	5.5%	19.0%

14. Equity investments in other companies

"Equity investments in other companies" totalled 1,784 thousand Euro, posting a net decrease of 26 thousand Euro compared with the figure at 31 December 2024. The change is mainly linked to the changes in the adjustment provision relating to the equity investment in Woojin Machinery Co Ltd.

(Euro /000)		Shareholding 31 December 2025 31 December 2024		Change
Colombera S.p.A.	16.56%	1,582	1,582	-
Woojin Plaimm Co Ltd	2.00%	159	159	-
Other	-	33	27	6
Adjustment provision	-	10	42	(32)
Total		1,784	1,810	(26)

The shareholdings are classified as available for sale and entered at fair value, derived from the stock market quotation, for Woojin Machinery Co. Ltd. (Seoul Stock Exchange). The adjustment provision is due to fair value adjustment, and changed as follows:

(Euro /000)		Shareholding 31 December 2025 31 December 2024		Change
Woojin Plaimm Co Ltd	2.00%	10	42	(32)
Total		10	42	(32)

15. Receivables and other noncurrent assets

At 31 December 2025, the balance of this item was nil, while it was 11 thousand at 31 December 2024.

(Euro /000)		31 December 2025 31 December 2024	Change
Guarantee deposits	-	11	(11)
Total	-	11	(11)

16. Net working capital

"Net working capital" totalled 12,593 thousand Euro, compared with 13,588 thousand Euro as at 31 December 2024, and is analysed below:

(Euro /000)		31 December 2025 31 December 2024	Change
Inventories	8,463	9,233	(770)
Trade receivables	8,897	7,400	1,497
Trade receivables from subsidiaries	12,474	11,605	869
Trade payables	(16,655)	(14,199)	(2,456)
Trade payables to subsidiaries	(586)	(451)	(135)
Net amount	12,593	13,588	(995)

Specifically, net working capital generated from dealings with subsidiaries was 11,888 thousand Euro, up by 734 thousand Euro compared with 2024, while the same item vis-à-vis third parties came to 705 thousand Euro (2,434 thousand Euro as at 31 December 2024).

The overall change is due to the increase in trade payables to third parties (2,456 thousand Euro), only partly offset by the increase in trade receivables from third parties (1,497 thousand Euro) and from subsidiaries (869 thousand Euro). Inventories also contributed to the overall decrease (770 thou-

sand Euro).

Inventories amounted to 8,463 thousand Euro, and may be broken down as

follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Raw materials, consumables and supplies	4,919	5,887	(968)
provision for impairment of raw materials	(618)	(698)	80
Work in progress and semi-finished products	3,709	3,429	280
provision for impairment of work in progress	(381)	(342)	(39)
Finished products and goods for resale	982	1,595	(613)
provision for impairment of finished products	(148)	(638)	490
Total	8,463	9,233	(770)

The provision for obsolescence and slow-moving inventories was adjusted according to need in 2025, through specific provisions amounting to 1,219 thousand Euro (as compared to 1,356 thousand Euro in the year 2024).

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

Changes in the provision in the years 2025 and 2024 are listed below.

(Euro /000)	31 December 2024 Provisions				Uses Releases 31 December 2025
Provision for impairment ofinventory	1,678	1,219	(1,750)	-	1,147
(Euro /000)	31 December 2023 Provisions				Uses Releases 31 December 2024
Provision for impairment ofinventory	2,967	1,356	(2,645)	-	1,678

Trade receivables went up by 2,366 thousand Euro overall compared to the previous year. Trade receivables from third parties are as follows:

(Euro /000)	31 December 2025 31 December 2024		Change
Receivables from customers due within 12 months	9,562	8,009	1,553
Provision for doubtful receivables	(665)	(609)	(56)
Net amount	8,897	7,400	1,497

Receivables are adjusted to their estimated realisable value by the allowance for doubtful accounts, which is determined by analysing individual debtor positions and considering past experience in each business area and geographical region, as required by IFRS 9. The provision as at 31 December 2025 represents a prudential estimate of the current risk, and registered the following changes:

(Euro /000)	31 December 2024 Provisions				Uses Releases 31 December 2025
Provision for doubtfulreceivables	609	64	(8)	-	665

1. This item relates to receivables from the sale of products and from service contracts carried out by Gefran S.p.A. in favour of subsidiaries.

The Company monitors the riskiest receivables and also implements specific legal measures. The carrying value of trade receivables and intercompany trade receivables is believed to approximate their fair value.

Trade payables at 31 December 2025 went overall down by 2,591 thousand Euro compared to 31 December 2024. Trade payables to third parties are

represented below:

(Euro /000)		31 December 2025 31 December 2024	Change
Payables to suppliers	14,485	12,668	1,817
Payables to suppliers for invoices to be received	2,170	1,531	639
Total	16,655	14,199	2,456

The value of trade payables to subsidiaries was 586 thousand Euro, compared with 451 thousand Euro at 31 December 2024. This item refers to payables resulting from the purchases of products and services from Gefran S.p.A. by Group subsidiaries.

The carrying value of trade payables and intercompany trade payables is believed to approximate their fair value.

17. Other current assets

"Other current assets" as of 31 December 2025 amounted to 2,411 thousand Euro, as compared to 2,895 thousand Euro on 31 December 2024. The balance breaks down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Services and maintenance	427	381	46
Receivables from employees	-	2	(2)
Advances payments to suppliers	207	110	97
Other tax receivables	631	722	(91)
Other	1,146	1,680	(534)
Total	2,411	2,895	(484)

The main change is given by the item "Other", down by 534 thousand Euro, which includes tax credits for research and development and tax credits for capital goods. The carrying value of this item is believed to approximate its fair value.

The changes in the provision for doubtful receivables relating to 2024 are as follows:

(Euro /000)	31 December 2023 Provisions				Uses Releases 31 December 2024
Provision for doubtful
receivables	674	-	(49)	(16)	609

The value of trade receivables from subsidiaries amounted to 12,474 thousand Euro, compared with a balance of 11,605 thousand Euro at 31 December

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

18. Current tax receivables and payables The net financial position at 31 December 2025 was positive by 12,817 thou-

sand Euro, an improvement over 31 December 2024 of 320 thousand Euro. This change originates essentially from the positive cash flows generated by typical operations (14,915 thousand Euro) and the collection of dividends from subsidiaries (4,421 thousand Euro), absorbed in part by disbursements for investment activities (totalling 12,965 thousand Euro) and the payment of dividends (6,107 thousand Euro).

The balance of cash and cash equivalents amounted to 40,074 thousand Euro as at 31 December 2025, lower than the balance at 31 December 2024, which was 6,744 thousand Euro:

(Euro /000)		31 December 2025 31 December 2024	Change
Cash in bank deposits	40,067	46,812	(6,745)
Cash	7	6	1
Total	40,074	46,818	(6,744)

The technical forms used as at 31 December 2025 are shown below:

/ maturities: collectible on demand;

• / counterparty risk: deposits are made with leading banks;

/ Country risk: the deposits are made in Italy.

Management considers that the credit lines currently available, together with the cash flow generated by operations, will enable Gefran to meet its financial requirements resulting from investing activities, working capital management and the repayment of debt at its natural maturity.

To support its current operations, the Company has various credit lines granted by banks and other financial institutions available, mainly in the form of loans for advances on invoices, cash flexibility and mixed loans for totalling 24,550 thousand Euro. As of 31 December 2025, the entire ceiling is available in full.

Financial receivables from subsidiaries refer to the balances of individual debt positions of the subsidiaries, generated by cash transfers by means of the cash pooling system, and present a balance of 786 thousand Euro, compared with 328 thousand Euro at 31 December 2024. This item is classified among current financial receivables.

Current tax receivables totalled 346 thousand Euro at 31 December 2025, compared with 260 thousand Euro at 31 December 2024. The balance breaks down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Other taxes	346	260	86
Total	346	260	86

The balance of current tax payables as at 31 December 2025 was 886 thousand Euro, while as at 31 December 2024 it was 74 thousand Euro, broken down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
IRES (corporate income tax)	742	67	675
IRAP (regional production tax)	144	7	137
Total	886	74	812

IRAP (regional production tax) and IRES (corporate income tax) are recognised on taxable income, to which prior tax losses are applied in full, in accordance with current legislation.

19. Net financial position

The net financial position is analysed in the following table:

(Euro /000)		31 December 2025 31 December 2024	Change
Cash and cash equivalents and current financialreceivables	40,074	46,818	(6,744)
Financial investments for derivatives	5	34	(29)
Non-current financial investments	102	104	(2)
Financial receivables from subsidiaries	786	328	458
Non-current financial payables	(11,621)	(16,116)	4,495
Non-current financial payables for IFRS 16 leases	(405)	(444)	39
Current financial payables	(4,837)	(5,095)	258
Current financial payables for IFRS 16 leases	(314)	(277)	(37)
Financial payables to subsidiaries	(10,795)	(12,544)	1,749
Financial liabilities for derivatives	(178)	(311)	133
Total	12,817	12,497	320

Current financial payables decreased by 258 thousand Euro at 31 December 2025 compared with 2024, and break down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Current portion of debt	4,792	5,035	(243)
Other payables	45	60	(15)
Total	4,837	5,095	(258)

The current portion of loans refers to short-term mortgages, in line with the amortisation schedules envisaged.

Financial payables to subsidiaries at 31 December 2025 amounted to 10,795 thousand Euro (12,544 thousand Euro at 31 December 2024) and refer to the balance of the individual creditor positions of the Group's subsidiaries, generated from transfers to the Parent Company of cash on hand through the cash pooling system for European subsidiaries and the Singapore subsidiary. This item is classified among current financial payables.

Non-current financial payables are analysed as follows:

		Change
		(755)
		(120)
		(2,253)
		(1,664)
		297
11,621	16,116	(4,792)
	-1206,2084,996297	31 December 2025 31 December 20247552408,4616,660-

The loans, detailed in the table, are all arranged at variable rates, with the exception of the Simest loans, which have a preferential fixed rate. Details of each loan are given below:

Bank	Amountdisbursed(Euro /000)	Signingdate	Balanceat 31December2025	Of whichwithin 12months	Of whichbeyond12months	Interest		rate Maturity Repaymentmethod
Intesa (ex UBI)		3,000 24Jul 20	755	755		- Euribor 6m		+ 1% 24Jul 26 half-yearly
UBI Banca S.p.A.	480	9Jul 21	240	120	120	Fixed		0.32% 31Dec 27 half-yearly
Crédit Agricole		13,000 29Sep 23	8,461	2,253		6,208 Euribor 3m	+ 0.88% 28Sep 29 quarterly
BNL		10,000 27Oct 23	6,660	1,664		4,996 Euribor 3m	+ 0.93% 27Oct 29 quarterly
UBI Banca S.p.A.		297 31Oct 25	297	-	297	Fixed		0.32% 31Oct 31 half-yearly
Total			16,413	4,792	11,621

In the fiscal year 2025, Gefran S.p.A. applied to the Simest call for the digital transition, for a total value of 1,290 thousand Euro, which provides for the granting of a 10% non-repayable grant and a 90% subsidised loan. As of 31 December 2025, 323 thousand Euro had been received, including both the disbursement of the quota**29** from the available resources of the revolving fund and the disbursement of the co-financing quota1 , to be used for investments in digital innovation and/or ecological transition, as well as for the strengthening of the Company's capital, benefiting competitiveness in international markets. This resulted in the recognition of grants totalling 25 thousand Euro and non-current financial payables totalling 297 thousand Euro.

The loan in question will be repaid in 8 half-yearly instalments, each of the same amount, starting from the end of the pre-amortisation period (lasting 2 years from 30 April 2026). The aid, pursuant to the EU de minimis Regulation, is therefore 231 Euro, once 100% of the financing and co-financing has been reached.

No new funding was subscribed during 2025 in addition to the above.

It should be noted that the loan with Crédit Agricole requires compliance with a financial parameter (covenant), calculated at the consolidated level, and in particular the ratio of net financial debt (NFP) to EBITDA < 3.25x. Failure to comply with the ratio could result in the lending institution being entitled to demand repayment. The verification of contractual constraints is updated on a quarterly basis by the Administration, Finance and Control Director and, specifically, the ratio as at 31 December 2025 is largely respected. The loan,

29 Provided for by the Decree of 1 June 2023 of the Minister of Foreign Affairs and International Cooperation, in agreement with the Ministers of Enterprise and Made in Italy, of Economy and Finance, containing "Regulation of financial instruments in support of the internationalization of companies, from the Revolving Fund 394/81" ("Decree").

therefore, is represented according to the forms originally provided for in the contract.

With the exception of the contract described above, none of the loans outstanding at 31 December 2025 has clauses requiring compliance with economic and financial requirements (covenants).

Variable rate payables expose the Company to a risk arising from interest rate volatility. In this regard, the Group's Administration and Finance Department monitors the exposure to interest rate risk and proposes appropriate hedging strategies to contain the exposure within the limits defined and agreed in the Group's policies, using derivatives, Interest Rate Swap (IRS) and Interest Rate Cap (CAP) when necessary.

All derivatives outstanding at 31 December 2025 are stipulated to hedge the interest rate risk on variable rate loans, which could occur in the event of a change in the Euribor. As of 31 December 2025, no derivatives have been taken out to hedge exchange rate risk.

All derivatives were tested for effectiveness as at 31 December 2025, with positive results.

The financial assets for derivatives amount to 5 thousand Euro (34 thousand Euro as at 31 December 2024), while the liabilities for derivatives amount to 178 thousand Euro (311 thousand Euro as 31 December 2024), due to the fair value of the individual contracts.

		as at 31 December 2025	as at 31December 2024
(Euro /000)	Positive fairvalue	Negative fairvalue	Positive fair value Negative fair	value
Interest rate risk	5	(178)	34	(311)
Total cash flowhedge	5	(178)	34	(311)

The following details are provided on hedges, showing the related fair value, positive and negative respectively:

Financial assets for derivatives totalled 5 thousand Euro, owing to the positive fair value of certain IRS contracts, entered into by the Company to hedge interest rate risks. A breakdown is provided in the following table:

Bank(Euro /000)	Notionalprincipal	Signing	date Maturity	Notionalas at 31December2025	Derivative	Fair Valueas at 31December2025	Longpositionrate	Shortpositionrate
Intesa(ex UBI)		3,000 24Jul 20 24Jul 26		755	IRS	5	Fixed	-0.115% Euribor 3m
Total financial assets forderivatives –Interest rate risk						5

Financial liabilities for derivatives totalled 178 thousand Euro, owing to the negative fair value of certain IRS contracts, also entered into by the Company to hedge interest rate risks. A breakdown is provided in the following table:

Bank(Euro /000)	Notionalprincipal	Signing	date Maturity	Notionalas at 31December2025	Derivative	Fair Valueas at 31December2025	Longpositionrate	Shortpositionrate
BNL		10,000 29Jan24 27Oct 29		6,660	IRS		(92) Fixed 2.94%	Euribor 3m(Floor:1.00%)
CréditAgricole		13,000 12Jan24 28Sep 29		8,461	IRS		(86) Fixed 2.75% Euribor 3m
Total financial liabilities forderivatives–Interest rate risk						(178)

The balance of Financial payables for leases (current and non-current) under IFRS 16 as of 31 December 2025 amounted to 719 thousand Euro and complies with the IFRS 16, applied by the Group from 1 January 2019, which requires the recording of financial payables corresponding to the value of the right-of-use assets recorded under non-current assets. Financial payables for leases under IFRS 16 are classified on the basis of their maturity as either current payables (due within one year), amounting to 314 thousand Euro, or non-current payables (due beyond one year), amounting to 405 thousand Euro.

The changes in the item in 2025 and 2024 are reported below.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

(Euro /000)	31 December 2024	Increases			Decreases Reclassifications 31 December 2025
Leasing payablesunder IFRS 16	721	317	(319)	-	719
(Euro /000)	31 December 2023	Increases
					Decreases Reclassifications 31 December 2024

A breakdown of financial debt, as per Esma and Consob regulations, is set out below.

(Euro /000)		31 December 2025 31 December 2024	Change
A. Cash	40,074	46,818	(6,744)
B. Cash equivalents	-	-	-
Financial receivables from subsidiaries	786	328	458
C. Other current financial assets	786	328	458
D. Cash and cash equivalents ( A ) + ( B ) + ( C )	40,860	47,146	(6,286)
Financial payables to subsidiaries	(10,795)	(12,544)	1,749
Current financial payables for IFRS 16 leases	(314)	(277)	(37)
Current financial payables	(45)	(60)
E. Current financial debts	(11,154)	(12,881)	1,727
F. Current portion of financial long-term debt	(4,792)	(5,035)	243
G. Current financial payables (E) + (F)	(15,946)	(17,916)	1,970
H. Net current financial payables (G) + (D)	24,914	29,230	(4,316)
I. Non current financial debts	(12,026)	(16,560)	4,534
Non-current financial liabilities for derivatives	(178)	(311)	133
J. Financial debt instruments	(178)	(311)	133
K. Trade payables and Other non-current debts	-	-	-
L. Non-current financial debt (I) + (J) + (K)	(12,204)	(16,871)	4,667
R. Total financial debt (H) + (L)	12,710	12,359	351
of which to minorities:	22,719	24,575	(1,856)

20. Shareholders' equity

"Shareholders' equity" at 31 December 2025 amounted to 88,283 thousand Euro, up by 4,101 thousand Euro from 31 December 2024. The change mainly relates to the recognition of the net profit for the year (10,107 thousand Euro), offset by the payment of dividends (6,107 thousand Euro) and the adjustment of cash flow hedging reserves, securities valuation at fair value and IAS 19 (overall positive in the amount of 100 thousand Euro).

Share capital amounts to 14,400 thousand Euro, represented by 14,400,000 ordinary shares with a nominal value of 1 Euro each.

As at 31 December 2024, Gefran S.p.A. held 198,405 own shares, equal to 1.38% of the total, with an average book value of 8.6483 Euro per share and a total value of 1,716 thousand Euro. During 2025 and as at the date of this publication, no trading activities took place; therefore, the situation is unchanged with respect to what is described above.

The Company has not issued any convertible bonds.

The type and purpose of the equity reserves can be summarised as follows:

/ the "Share premium reserve", amounting to 19,046 thousand Euro, which is a capital reserve that includes the amounts received by the Company for the issue of shares at a price higher than their nominal value;

/ the "Legal reserve", amounting to 2,880 thousand Euro, which is populated by the mandatory allocation of an amount not less than one-twentieth of annual net profits, until an amount equal to one-fifth of the share capital has been reached (which has already occurred);

/ the "Extraordinary reserve" (9,255 thousand Euro), which is recognised

/ the "Reserve for conversion to IAS/IFRS" (137 thousand Euro), which is

• under "Other reserves";
• included under "Other reserves";
• ognised directly under shareholders' equity;

/ the "Share fair value measurement reserve" (positive by 10 thousand Euro), which includes the effects of the measurement of shares at fair value rec-

/ the "Cash flow hedge reserve", which includes effects recognised directly in shareholders' equity as deriving from the measurement at fair value of financial derivatives to hedge cash flows from changes in interest rates and exchange rates. It is negative and amounts to 131 thousand Euro;

/ the "Employee benefits valuation reserve pursuant to IAS 19", which is negative at 235 thousand Euro, and is included under "Other reserves";

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

• / the "Reserve under Article 1, paragraph 436, letter a) of Italian Law 207/2024" (8,178 thousand Euro) which includes, following the resolution of the Shareholders' Meeting of 10 April 2025, a portion of the net profit for the year 2024 pursuant to Article 1, paragraphs 436-444 of Italian Law 30 December 2024;
• / The "Own shares reserve" (1,716 thousand Euro), which is recognised under "Other reserves";
• / the "Merger surplus reserve" (858 thousand Euro), which was set up in 2006 after the merger by incorporation of Siei S.p.A. and Sensori S.r.l. and is included under "Other reserves".

Shareholder's equity breaks down as follows:

(Euro /000)	Amount	Possibility ofutilisation	Portionavailable
Share capital	14,400
Capital reserves
Share premium reserve	19,046	A-B-C	19,046
Capital reserves
- legal reserve	2,880	B
- extraordinary reserve	9,255	A-B-C	9,255
- IFRS conversion reserve	137
- reserve for the measurement of securities at fair value	10
- cash flow hedging reserve	(131)
- IAS 19 reserve	(235)
- art. 1, co. 436 lett. a) L. 207/2024 reserve	8,178
- own shares reserve	(1,716)
- merger surplus reserve	858	A-B-C	858
- retained earnings/losses	25,494	A-B-C	25,494
- profit (loss) for the period	10,107
Total	88,283		54,653
Restricted portion			6,700
Residual portion available	88,283		47,953

NB: Legend of possibility of utilisation:

A: for a share capital increase;

B: to hedge losses;

C: for distribution to shareholders;

For details on the changes in equity reserves during the year, see the schedule showing changes in shareholders' equity.

The changes in the "Reserve for the measurement of securities at fair value" and the "Reserve for the measurement of derivatives at fair value" are summarised below.

(Euro /000)		31 December 2025 31 December 2024	Change
Balance at 1 January	42	157	(115)
Woojin Plaimm Co Ltd Shares	(32)	(116)	84
Tax effect	-	1	(1)
Net amount	10	42	(32)

(Euro /000)		31 December 2025 31 December 2024	Change
Balance at 1 January	(210)	141	(351)
Change in fair value derivatives	104	(462)	566
Tax effect	(25)	111	(136)
Net amount	(131)	(210)	79

21. Employee benefits

Liabilities for "Employee benefits" showed the following changes:

(Euro /000)

(Euro /000)	31 December2024	Increases	Decreases		Discounting 31 December2025
Post-employment benefits	1,438	-	(84)	(19)	1,335
Non-competition agreements	73	-	(12)	(3)	58
Total	1,511	-	(96)	(22)	1,393

Changes relating to 2024 were as follows:

(Euro /000)	31 December2023	Increases	Decreases		Discounting 31 December2024
Post-employment benefits	1,505	-	(95)	28	1,438
Non-competition agreements	-	65	(7)	15	73
Total	1,505	65	(102)	43	1,511

This item "Termination benefits" consists of the so-called Post-employment benefit reserve recognised for the Company's employees, in addition to the recognition of residual payables to employees for the signing of agreements that protect the Company from competitive activities, the so-called Non-Competition Agreements.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

The change relates to disbursements to employees of 96 thousand Euro (102 thousand Euro in 2024) and includes the effect of discounting of the existing payable according to IFRS regulations, negative by 22 thousand Euro, as a result of the assessment of demographic assumptions and experience (a negative impact of 1 thousand Euro), changes to financial assumptions (negative impact of 70 thousand Euro) and Interest cost (positive impact of 49 thousand Euro).

Pursuant to IAS 19, the post-employment benefit reserve and the non-competition agreement were measured using the "benefits accrued" method on the basis of the "Projected Unit Credit"(PUC) criterion.

The post-employment benefit reserve valuation breaks down as follows:

• / projection until the time of payment of the post-employment benefit already accrued at the option date and revalued as of the valuation date, for each employee;
• / projection, for each person employed as of the measurement date, of the post-employment benefit already accrued and future quotas of the post-employment benefit that will be accrued from 30.06.2018 up to the date of payment, projecting the worker's pay; in particular, it should be noted that in this case the Service Cost for the period between the option date and 30.06.2018 will be null;
• / determination, for each employee, of probabilised payment of the above post-employment benefit which must be made by the company if the employee leaves the company due to dismissal, resignation, inability, death, or retirement, or in response to requests for advance payment;
• / discounting of each probabilised payment as of the assessment date;
• / re-proportioning of services for each employee, probabilised and discounted on the basis of seniority accrued as of the measurement date, as compared to the corresponding total as of the payment date.

In greater detail, the technical bases used are:

Demographic assumptions	2025	2024
Probability of death	ISTAT 2014 Mortality tables	ISTAT 2014 Mortality tables
Probability of inability		INPS tables divided by age and gender INPS tables divided by age and gender
	100% upon reaching AGO	100% upon reaching AGO
Probability of retirement	requirements	requirements
Hypothetical turnover andadvances	2025	2024
Frequency of advances:	2.1%	2.1%
	2% up to age 50	2% up to age 50
Frequency of resignation	0% after 50	0% after 50

Financial assumptions	2025	2024
Discount rate	3.96%	3.38%
Annual inflation rate	2%	2%
Annual rate of increase of postemployment benefit	3%	3%

This is the method applied to the assessment of Non-Competition Agreements, and the technical bases used:

/ projection, for each employee as of the measurement date, of non-competition agreements already set aside and future quotas of non-competition agreements which will be accrued up to the date of payment;

/ determination, for each employee, of probabilised payment of the non-competition agreement covenant that would have to be paid by the company in the event that the employee should be dismissed or retire;

/ discounting of each probabilised payment as of the measurement date.

Demographic assumptions	2025	2024
	RG48 mortality tables published by	RG48 mortality tables published by
Probability of death	General State Accounting	General State Accounting
	Department	Department
	100% upon reaching AGO	100% upon reaching AGO
Probability of retirement	requirements	requirements
Probability of voluntary resignation of	4.00% up to age 50	4.00% up to age 50
Managers and Middle Managers	0.50% after age 50	0.50% after age 50
Financial assumptions	2025	2024
Annual nominal pay increase	2.7%	2.7%

Annual time-discount rate 2.79% 2.77%

The discount rate used to determine the present value of the obligation was drawn, in accordance with paragraph 83 of IAS 19, from the Iboxx Corporate AA index with 10+ duration at the measurement date. To this end, a yield with a duration comparable to that of the collective group of workers under assessment was chosen.

The annual rate of increase in post-employment benefits, as provided for in Article 2120 of the Italian Civil Code, is 75% of inflation plus 1.5 percentage points.

The sensitivity analysis carried out on the assumptions of 1% and 0.5% changes in the discount rate used is shown below:

(Euro /000)	31 December 2025			31 December 2024
	-1.0%	1.0%	-1.0%	1.0%
Post-employment benefit reserve	(114)	101	(133)	116
Non-competition agreements	(1)	1	(2)	2
Total	(115)	102	(135)	118

(Euro /000)		31 December 2025		31 December 2024
	-0.5%	0.5%	-0.5%	0.5%
Post-employment benefit reserve	(55)	52	(64)	60
Non-competition agreements	(1)	1	(1)	1
Total	(56)	53	(65)	61

22. Current and non-current risk provisions

"Non-current risk provisions" amounted to 50 thousand Euro at 31 December 2025, relating to provisions for legal disputes in connection with an ongoing employment lawsuit involving a former Company employee.

(Euro /000)	31 December2024	Provisions		Uses Releases	31 December2025
- for legal disputes	-	50		-	50
Total	-	50	-	-	50

The balance of "Current provisions" was 608 thousand Euro as of 31 December 2025, compared with provisions of 667 thousand Euro at 31 December 2024. The item breaks down as follows:

(Euro /000)	31 December2024	Provisions		Uses Releases	31 December2025
FISC	29	3	-	-	32
Product warranty	638	257	(190)	(129)	576
Total	667	260	(190)	(129)	608

This item referring to the expected cost of repairs to products under warranty saw provision (257 thousand Euro) and use to cover the cost of repair and replacement of products under warranty (190 thousand Euro); during 2025, releases were made (129 thousand Euro) for the provision surplus, which as of 31 December 2025 was proportionate to the volume of revenues and the regularity with which events have historically occurred.

23. Other liabilities

"Other liabilities" at 31 December 2025 amounted to 9,119 thousand Euro and

break down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Payables to personnel	4,173	3,448	725
Social security payables	2,263	2,101	162
Accrued interest on loans	45	60	(15)
Payables to directors and statutory auditors	104	73	31
Other accruals	1,293	1,351	(58)
Other payables for taxes	1,219	1,201	18
Other current liabilities	22	19	3
Total	9,119	8,253	866

The change is primarily attributable to increased payables to employees and to social security institutions.

24. Revenues from product sales and services

"Revenues from product sales and services" in 2025 amounted to 80,950 thousand Euro, as compared to 75,536 thousand Euro in the year 2024. Revenues from sales and services are analysed by business area in the following table.

(Euro /000)	31December2025	31December2024	Change	%
Sensors	60,526	54,367	6,159	11.3%
Automation components	20,424	21,169	(745)	-3.5%
Total	80,950	75,536	5,414	7.2%

The increase over the previous fiscal year (+7.2%) was due to higher revenues generated by the sensors business (+11.3%), while product sales in the automation components business showed a decline compared to the previ-

ous fiscal year (-3.5%).

Total revenues include revenues from services provided totalling 145 thousand Euro (137 thousand Euro in the previous year).

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

25. Other operating revenues and income 27. Service costs

"Service costs" amounted to 15,597 thousand Euro, as compared to 14,234 thousand Euro in the year 2024, an increase of 1,363 thousand Euro. They may be broken down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Services	15,043	13,692	1,351
Use of third-party assets	554	542	12
Total	15,597	14,234	1,363

Accounting standard IFRS 16, "Leasing", provides that all leasing contracts are recorded using the financial method; therefore, leasing fees do not appear among operating costs in the income statement, but represent repayment of the loan entered at the same time as entry of right-of-use assets and interest among assets in the financial statements.

Lease fees no longer allocated to the income statement under operating costs due to application of the accounting standard amount to 346 thousand Euro (308 thousand Euro in 2024). Contracts excluded from the adoption of IFRS 16 on the basis of the provisions of the standard, for which lease fees continue to be entered in the income statement, resulted in an entry of 554 thousand Euro in costs in 2024 (542 thousand Euro in 2024).

The increase in "Services", amounting to 1,351 thousand Euro, mainly relates to higher costs for external work, professional consultancy (particularly technical and commercial), advertising and trade fairs.

28. Miscellaneous management costs and other operating income

"Miscellaneous management costs" present a balance of 445 thousand Euro, as compared to a balance of 683 thousand Euro in 2024, and may be broken

down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Capital losses on the sale of assets	(1)	-	(1)
Other taxes and duties	(169)	(166)	(3)
Membership fees	(172)	(144)	(28)
Miscellaneous	(103)	(373)	270
Total	(445)	(683)	238

26. Costs of raw materials and accessories

"Costs of raw materials and accessories" resulted in an increase of 1,956 thousand Euro, going from 25,351 thousand Euro in 2024 to 27,307 thousand Euro in the year 2025.

31December2025	31December2024	Change	%
			13.6%
			3.9%
			4.8%
			n.a.
			-16.5%
			n.a.
1,086	844	242	28.7%
5,189	4,769	420	8.8%
	4593,34222723736	4043,21621-284-	5512617(47)36

The item "Other income" amounted to 1,086 thousand Euro, up by 242 thousand Euro compared to the figure recorded at 31 December 2024. It includes, among others, the chargebacks for R&D specifically requested by customers, as well as the recognition of tax credits for investing in R&D, assets, Industry 4.0 and the Digital Academy (in 2025 they were equal to 602 thousand Euro, while they amounted to 620 thousand Euro in the same period of the previous year). In 2025, the granting of AWS (Amazon Web Service) incentives amounting to 196 thousand Euro was also recorded.

The item "Government grants" amounting to 36 thousand Euro, includes grants for the installation of electric vehicle charging stations (investment made in the Parent Company Gefran S.p.A. in 2024) as well as the advance of the grant relating to the Simest tender, as previously described.

"Other operating revenues and income" amounted to 5,189 thousand Euro, 420 thousand Euro higher than on 31 December 2024, as shown in the table below.

(Euro /000)		31 December 2025 31 December 2024	Change
Raw materials and accessories	27,307	25,351	1,956
Total	27,307	25,351	1,956

The increase is due to the growth in sales volumes compared with the previous fiscal year.

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

"Other operating income" amounted to 59 thousand Euro and is made up as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Capital gains on the sale of assets	50	47	3
Miscellaneous	9	34	(25)
Total	59	81	(22)

29. Personnel costs

"Personnel costs" amounted to 29,483 thousand Euro, up by 2,071 thousand Euro compared with 2024, and break down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Salaries and wages	21,629	20,266	1,363
Social security contributions	6,011	5,712	299
Post-employment benefit reserve	1,476	1,429	47
Other costs	367	5	362
Total	29,483	27,412	2,071

The change in 2025 compared to the previous year (totalling 2,071 thousand Euro) reflects the higher impact of the salary increase provided for by the National Collective Bargaining Agreement of June 2024 for all Gefran S.p.A. employees, as well as the increase in workforce to support the execution of the Group's strategy.

The number of employees employed by the Company at year end, amounting to 397 employees (+13 employees at 31 December 2025 compared to the exact figure of the previous year), increased.

Overall, the average number of employees in 2025 (calculated as the annual average) was 391 while in 2024 it was 364.

	2025	2024	Change
Managers	14	13	1
Clerical staff	218	208	10
Manual workers	159	143	16
Total	391	364	27

"Social security contributions" include costs for defined contribution plans for management (Previndai and Azimut Previdenza pension plan) amounting to 151 thousand Euro (127 thousand Euro at 31 December 2024).

30. Depreciation, amortisation and

impairment

uro /000)

		Change
		93
		(19)
		29
6,126	6,023	103
	1,7414,059326	31 December 2025 31 December 20241,6484,078297

They are equal to 6,126 thousand Euro, with an increase of 103 thousand Euro compared to the figure for 31 December 2024. There were no write-downs in

2025 and 2024.

Moreover, the item also includes amortisation of right-of-use assets in accordance with accounting standard IFRS 16, totalling 326 thousand Euro at 31 December 2025 (297 thousand Euro at 31 December 2024).

31. Gains and losses from financial assets/liabilities The item also includes dividends received by Gefran Group companies totalling

4,450 thousand Euro (4,310 thousand Euro in 2024), broken down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Gefran Asia Pte Ltd (Singapore)	1,400	1,000	400
Gefran India Private Ltd (India)	170	-	170
Gefran Soluzioni S.r.l. (Italy)	500	300	200
Gefran Deutschland GmbH (Germany)	1,300	1,500	(200)
Gefran Inc (U.S.)	450	925	(475)
Gefran France SA (France)	200	200	-
Gefran Benelux NV (Belgium)	430	385	45
Total	4,450	4,310	140

"Gains from financial assets" totalled 4,228 thousand Euro, as compared to 4,222 thousand Euro in 2024, and break down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Cash management
Interest from subsidiaries	5	9	(4)
Income from cash management	778	1,241	(463)
Other financial income	4	12	(8)
Medium-/long-term interest	(680)	(931)	251
Interest to subsidiaries	(257)	(435)	178
Other financial charges	-	(5)	5
Total income (charges) from cash
management	(150)	(109)	(41)
Currency transactions
Exchange gains	276	208	68
Positive currency valuation differences	-	34	(34)
Exchange losses	(308)	(206)	(102)
Negative currency valuation differences	(19)	-	(19)
Total other income (charges) from currencytransactions	(51)	36	(87)
Other
Gains from financial instruments	4	1	3
Dividends from equity investments	4,450	4,310	140
Value adjustments on non-current assets	(230)	-	(230)
Interest on financial payables due to leasing underIFRS 16	(25)	(16)	(9)
Total other financial income (charges)	4,199	4,295	(96)
Total	3,998	4,222	(224)

Financial income at 31 December 2024 amounted to 787 thousand Euro (1,262 thousand Euro in 2024), while financial charges related to the Company's indebtedness amounted to 937 thousand Euro; overall the item is down compared to the figure for 2024, when it amounted to 1,371 thousand Euro as a result of the reduction in the value of loans. The negative result of differences in foreign currency transactions, totalling 51 thousand Euro, as compared to a positive result of 36 Euro in 2024.

It should also be noted that, in 2025, adjustments were made to non-current assets to reflect a change in the value of the equity investment in the subsidiary Gefran Schweiz AG (negative in the amount of 230 thousand Euro). In 2024, no value adjustments were recognised on non-current assets.

32. Income taxes, deferred tax assets and deferred tax liabilities

"Taxes" as at 31 December 2025 were, on the whole, negative by 2,233 thousand Euro, and negative by 2,206 thousand Euro as at 31 December 2024. The item breaks down as follows:

(Euro /000)		31 December 2025 31 December 2024	Change
Current taxes
IRES (corporate income tax)	(1,603)	(1,443)	(160)
IRAP (regional production tax)	(448)	(381)	(67)
Total current taxes	(2,051)	(1,824)	(227)
Deferred taxes
Deferred tax liabilities	1	6	(5)
Deferred tax assets	(183)	(388)	205
Total deferred taxes	(182)	(382)	200
Total taxes	(2,233)	(2,206)	(27)

Current taxes amounted to 2,051 thousand Euro and relate to the recognition of IRES (corporate income tax) and IRAP (regional production tax) taxable amounts (amounting to 1,824 thousand Euro in 2024).

The balance of the item deferred tax assets and deferred taxes was negative by 182 thousand Euro, as compared to a negative balance of 382 thousand Euro on 31 December 2024; the change is mainly a result of the release of

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

deferred tax assets entered in relation to the provision for write-down of inventory.

The reconciliation of income taxes accounted and theoretical taxes, resulting from the application to profit before tax of the corporate income tax rate in force (24%), is as follows:

(Euro /000)	31 December 2025	31 December 2024
Profit (loss) before tax	12,340	12,428
Theoretical income taxes	(3,017)	(2,980)
Net effect of permanent
differences	1,181	1,190
Net effect of temporary
deductible and taxable	135	327
differences
Effect of taxes from previous
years	129	20
Current taxes	(1,572)	(1,443)
Income tax – deferred tax assets/
liabilities	(176)	(330)
Income tax entered in
the financial statement
(excluding current and	(1,748)	(1,773)
deferred regional production
tax IRAP)
IRAP - current taxes	(479)	(381)
IRAP – deferred tax assets/
liabilities	(6)	(52)
Recognised income taxes(current and deferred)	(2,233)	(2,206)

The net effect of permanent differences mainly refers to dividends received during the year and amounts reflecting super/hyper-depreciation.

Deferred tax assets and deferred tax liabilities for the years 2025 and 2024

break down as follows.

(Euro /000)

(Euro /000)	31December2024	Posted tothe incomestatement	Recognised inshareholders'equity	Otherchanges	31December2025
Deferred tax assets
Impairment of inventories	468	(147)	-	-	320
Impairment of trade receivables	172	(12)	-	-	160
Impairment of assets	535	-	-	-	535
Exchange rate balance	6	(6)	-	-	-
Provision for product warranty risk	178	(17)	-	-	161
Provision for miscellaneous risks	4	(1)	-	-	3
Fair Value hedging	66	-	(26)	-	41
Total deferred tax assets	1,429	(183)	(26)	-	1,220
Deferred tax liabilities
Discounting post-employmentbenefits	(12)	-	(15)	-	(27)
Fair value measurement	(1)	1	-	-	-
Exchange valuation differences	-	-	-	-	-
Other deferred tax liabilities	-	-	-	-	-
Total deferred taxes	(13)	1	(15)	-	(27)
Net total	1,416	(182)	(41)	-	1,193

	Deferred tax assets
	Deferred tax liabilities
	Discounting post-employment
(Euro /000)
	Deferred tax assets
	Deferred tax liabilities
	Discounting post-employment

(Euro /000)	31December2023	Posted tothe incomestatement	Recognised inshareholders'equity	Otherchanges	31December2024
Deferred tax assets
Impairment of inventories	828	(360)	-	-	468
Impairment of trade receivables	184	(12)	-	-	172
Impairment of assets	535	-	-	-	535
Exchange rate balance	-	6	-	-	6
Provision for product warranty risk	193	(15)	-	-	178
Provision for miscellaneous risks	6	(7)	5	-	4
Fair value hedging	-	-	66	-	66
Total deferred tax assets	1,746	(388)	71	-	1,429
Deferred tax liabilities
Discounting post-employment
benefits	(6)	-	(6)	-	(12)
Fair value measurement	(44)	(2)	45	-	(1)
Exchange valuation differences	(6)	6	-	-	-
Other deferred tax liabilities	(2)	2	-	-	-
Total deferred taxes	(58)	6	39	-	(13)
Net total	1,688	(382)	110	-	1,416

33. Guarantees granted, commitments and other contingent liabilities

a. Guarantees granted

On 30 September 2022, with regard to the sale of the motion control business to the Brazilian group WEG, Gefran S.p.A. issued a bank guarantee to WEG Equipamentos Eléctricos S.A., expiring on 30 September 2026. This guarantee amounted to 1,150 thousand Euro at 31 December 2024 (1,150 thousand Euro also at 31 December 2024).

b. Legal proceedings and disputes

Gefran S.p.A. is involved in various legal proceedings and disputes. However, the resolution of these disputes is not thought able to generate significant liabilities not already covered by existing provisions. Specifically, a lawsuit is currently under way against a former employee of the Company.

c. Commitments

The Company has stipulated contracts for rental of real estate and leasing of equipment, electronic machinery and company vehicles. Pursuant to accounting standard IFRS 16, the amount of lease fees remaining payable appears in the financial statement under the items "RoU assets and Financial payables for leases under IFRS16"; please refer to the notes for more information.

As required under the new accounting standard, some residual existing contracts have been excluded from the scope of application as they met the requirements for exclusion; leasing costs for these contracts entered in the income statement amount to 554 thousand Euro in the year 2025 (542 thousand Euro on 31 December 2024).

At 31 December 2025, the total value of the Company's commitments was 635 thousand Euro (637 thousand Euro at 31 December 2024). This amount mainly refers to ancillary services pertaining to leasing and rental contracts expiring within the following 5 years and subject to IFRS 16, as well as to contracts for which, based on their value and duration, the above standard has not been applied.

34. Dealings with related parties

30 As per internal regulations, the threshold of 50 thousand Euro identifies the most significant dealings; dealings of lower amounts are therefore not reported.

The following information is provided on dealings with related parties in the years 2025 and 2024, in accordance with IAS 24.

In compliance with Consob resolution no. 17221 of 12 March 2010, the Gefran S.p.A. Board of Directors of Gefran S.p.A. has adopted the "Regulations governing transactions with related parties", the current version of which was approved on 12 February 2026 and may be consulted on the Company's website (https:// www.gefran.com/governance/documents-and-procedures/).

Transactions with related parties are part of normal operations and the typical business of each entity involved and are carried out under normal market conditions. There have not been any atypical or unusual transactions.

Noting that the economic and equity effects of consolidated intragroup transactions are eliminated in the consolidation process, the most significant 30 dealings with related parties are listed below. These transactions have no material impact on the Group's economic and financial structure. They are summarised in the following tables:

(Euro /000)	Imet S.p.A.	Climat S.r.l.	Total
Costs for raw materials and accessories
2024	(507)	-	(507)
2025	(723)	-	(723)
Service costs
2024	-	(144)	(144)
2025	-	(182)	(182)

(Euro /000)	Imet S.p.A.	Climat S.r.l.	Total
Property, plant, machinery and tools
2024	-	198	198
2025	-	345	345
Trade payables
2024	170	144	314
2025	223	335	558

(Euro /000)	Imet S.p.A.	Climat S.r.l.	Total
Property, plant, machinery and tools
2024	-	198	198
2025	-	345	345
Trade payables
2024	170	144	314
2025	223	335	558

540 541

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

Gefran S.p.A.'s dealings with subsidiaries and associates are set out in the Company's Specific explanatory notes of Gefran S.p.A. to the individual items in the statement of financial position and the income statement, and mainly pertain to:

• / relations in connection with sales of products and services;
• / service contracts (communication, legal, corporate, finance and cash, IT, product marketing, personnel management) in favour of subsidiaries;
• / relations of a financial nature, represented by current account relations for cash pooling purposes.

All these relations were created in the normal course of operations, taking account of the level of service provided or received and in compliance with procedures to ensure the material correctness of the transaction.

In its dealings with its subsidiaries, Gefran S.p.A. provided technical, administrative and management services and payment of royalties on behalf of the Group's operative subsidiaries totalling about 3.8 million Euro under specific agreements (3.6 million Euro as of 31 December 2024).

Gefran S.p.A. provides a Group cash pooling service, partly through a "Zero Balance" service, which involves all the European subsidiaries and the Singapore subsidiary.

None of the subsidiaries holds shares of the Parent Company or held them during the period.

In the year 2025, Gefran S.p.A. recognised dividends from subsidiaries amounting to 4.5 million Euro (4.3 million Euro in 2024).

Members of the Board of Directors and the Board of Statutory Auditors were paid the following aggregate remuneration: 279 thousand Euro included in personnel costs and 1,227 thousand Euro included in service costs (258 thousand Euro included in personnel costs and 1,221 thousand Euro included in service costs in 2024). With regard to the remuneration of executives with strategic responsibility, reference is made to the Remuneration Report as at 31 December 2025.

It should be noted that the information referred to in Article 123-bis of Italian Legislative Decree no. 58/1998 is contained in a separate document, the "Report on Corporate Governance and Ownership Structure", which refers for some information to the "Remuneration Report", prepared pursuant to Article 123-ter of Italian Legislative Decree no. 58/1998. Both reports are published on the Company's website (at the address https://www.gefran.com/governance/ shareholders-meetings/).

Persons of strategic importance have been identified as members of the executive Board of Directors of Gefran S.p.A. and of other Group companies, as well as executives with strategic responsibility, identified in the following Group figures: Chief Financial Officer, Chief People & Organization Officer, Chief Sales Officer, Chief Technology Officer, Sensors Unit Director and Chief Operation Officer.

35. Information pursuant to Article 149-duodecies of the Consob Issuers' Regulation

The table below shows fees paid in relation to the year 2025 for auditing services and for services other than auditing provided by the External Auditor and entities in its network.

Total
Audit on Sustainability Re
Accounts audit

(Euro /000)	Party that provided the service	Fees for 2025
Accounts audit	Deloitte & Touche S.p.A.	106
Audit on Sustainability Reporting	Deloitte & Touche S.p.A.	50
Total		156

36. Events after 31 December 2025

With regard to operating performance at the beginning of 2026, we refer to the paragraphs on Significant events after year end in Gefran S.p.A. and Outlook of Gefran S.p.A. contained in the Report on Operations.

In view of the current geo-political scenario, it should be noted that the Company does not own strategic assets in the territories currently involved and that sales in these regions are limited. Although the scenario may evolve further, in light of the current forecasts, Gefran does not consider the hostilities that have occurred to have a significant impact on its activities and consequently its ability to generate income.

No other significant events took place after the year-end.

37. Allocation of result for the period

The year 2025 ended with a profit of 10,107,417 Euro. In specifying that the legal reserve has long since reached the limit set by the Civil Code and that the available reserves largely cover the development costs recorded in non-current assets, taking note of the Report of the Board of Statutory Auditors and the External Auditor's Report, it is proposed to the Shareholders' Meeting to:

• / approve the Board of Directors' Report on Operations and the annual financial statements for the period ending 31 December 2025, which show a profit of 10,107,417 Euro, as presented by the Board of Directors;
• / to distribute to the shareholders, by way of dividend, gross of the legal withholdings, 0.43 Euro for each of the outstanding shares (net of the own shares), using, for the necessary amount, the net profit for the year;
• / allocate to "Retained earnings" the amount corresponding to the share of the net profit for the year which remains net of the allocation as per the previous point.

The dividend, in compliance with the provisions of the "Regulation of the markets organised and managed by Borsa Italiana S.p.A.", will be paid as follows: ex-dividend date 4 May 2026, record date 5 May 2026, in payment beginning on 6 May 2026.

The amount of the dividend is fully covered by the profit for the period and sufficient financial funds are already available for the payment.

38. Summary of public funds pursuant to Article 1, paragraphs 125-129, Law no. 124/2017

In compliance with the transparency and publicity requirements provided for under Law no. 124 of 4 August 2017, Article 1, paragraphs 125-129, which made it compulsory for companies to disclose "subsidies, contributions, and other economic advantages of any kind" in the notes to the financial statements, the details of the relevant amounts are given below, in addition to what has already been published in the Italian national register of state aid – transparency

of individual aid.

R&D Tax creditIndustry 4.0 Tax credit
Energy Tax credit
Total

(Euro /000)	Providing body	Values in 2025
R&D Tax credit	Italian Government	205
Industry 4.0 Tax credit	Italian Government	321
Energy Tax credit	Italian Government	-
Total		526

39. Other information

Pursuant to Article 70, paragraph 8, and Article 71, paragraph 1-bis, of the Consob Issuers' Regulation, the Board of Directors decided to take advantage of the option to derogate from the obligation to publish the information documents prescribed in relation to significant mergers, spin-offs, capital increases through contribution in kind, acquisi-

tions and disposals.

Provaglio d'Iseo, 12 March 2026

For the Board of Directors

Chairwoman

Maria Chiara Franceschetti

Chief Executive Officer

Marcello Perini

Gefran S.p.A. Separate financial statements at 31 December 2025 Gefran Group

CERTIFICATION OF ANNUAL FINANCIAL STATEMENTS UNDER ARTICLE 81-TER OF CONSOB REGULATION NO. 11971 OF 14 MAY 1999 AS AMENDED

Chief Executive Officer

Marcello Perini

Executive in charge of financial reporting

Paolo Beccaria

The undersigned Marcello Perini, in his capacity as Chief Executive Officer, and Paolo Beccaria, as the Executive in charge of financial reporting of Gefran S.p.A., hereby certify, with due regard for the provisions of Article 154-bis, paragraphs 3 and 4, of Italian Legislative Decree 58 dated 24 February 1998:

the adequacy, with respect to the Company's characteristics,

and

They further certify that

/ the annual financial statements at 31 December 2025 of Gefran S.p.A.:

• − were prepared in accordance with the applicable international accounting standards endorsed by the European Union pursuant to Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002;
• − correspond to the entries made in accounting ledgers and records;
• − provide a true and accurate representation of the financial situation of the issuer;
• / the Report on Operations contains a reliable analysis of operating performance and results and of the condition of the issuer, together with a description of the main risks and uncertainties to which it is exposed.

Provaglio d'Iseo, 12 March 2026

EXTERNAL AUDITOR'S REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS

mpairment assessment of goodwill
Description of theey audit matter	The Group has recognised Goodwill in the amount of Euro 5,918thousand, representing 3.6% of the total assets of the consolidated
	financial statements as at December 31, 2025.Such goodwill is allocated to the "Cash Generating Units" ("CGUs")
	identified by Management on a geographical basis: France for Euro1,310 thousand, USA for Euro 2,499 thousand, Switzerland for Euro1,954 thousand and Italy for Euro 155 thousand.
	In accordance with the International Accounting Standard "IAS 36Impairment of Assets", Management performed a test of therecoverability of value (impairment test) to determine that the carryingamounts of the assets of the individual CGUs are recorded in theconsolidated financial statements as at December 31, 2025 at a valuenot exceeding their recoverable amount.
	The valuation process performed by Management regarding therecoverability of the CGUs subject to analysis, which is conductedthrough the determination of value in use, is complex and is based onassumptions concerning, among others, (i) the estimation of cash flowderived from the approved business plan data for the explicit forecastperiod 2026-2028 approved by the Board of Directors with respect to thparent company on December 18, 2025 and the terminal value, (ii) thedetermination of an appropriate discount rate (WACC), and (iii) theestimate of a long-term growth rate (g-rate). The determination of valuein use is further based on assumptions influenced by futureexpectations and external variables, including the evolution of therelevant markets.
	Following the impairment testing, approved by the Board of Directors aits meeting held on March 12, 2026, the Group did not recognize anyimpairment losses on assets.

Note "13. Goodwill" and the sections "Business combinations andgoodwill" and "Impairment of assets" in Note "6. Measurement criteria"in the specific explanatory notes to the consolidated financialstatements, included in the annual financial report as at December 31,2025, provide disclosures on goodwill, including disclosures on thesensitivity analyses performed by Management that illustrate the effectsarising from changes in the key variables used for the impairment test.
As part of our audit procedures, we performed, among other things, thefollowing procedures, also with the support of experts from ourNetwork:
examination of the methods used by Management to determine$\bullet$value in use, analysing the methodologies and assumptions used indeveloping the impairment test;
identification and understanding of the relevant controls$\bullet$implemented by the Group over the process of performing theimpairment test;
analysis of the reasonableness of the principal assumptions adopted$\bullet$in formulating the cash flow forecasts, also through analysis ofindustry data and obtaining information from Management;
analysis of actual results compared to the original plans in order to$\bullet$assess the nature of the variances and the reliability of the planpreparation process;
evaluation of the reasonableness of the discount rate (WACC) and$\bullet$long-term growth rate (g-rate) in determining the value in use;
• verification of the mathematical accuracy of the model used todetermine the value in use of the CGUs;
verification of the correct determination of the carrying amount of the$\bullet$CGUs and comparison of the recoverable amount of the CGUs withtheir carrying amount;
• examination of the sensitivity analyses prepared by Management;
• verification of the adequacy of the disclosures provided by the Boardof Directors on the impairment test and its compliance with the

EXTERNAL AUDITOR'S REPORT ON THE SUSTAINABILITY REPORT

EXTERNAL AUDITOR'S REPORT ON THE ANNUAL FINANCIAL STATEMENTS OF GEFRAN S.P.A.

	Impairment assessment of investments in subsidiaries
Description of thekey audit matter	The Company's financial statements as at December 31, 2025 includeinvestments in controlled enterprises totaling Euro 26,951 thousand, ofwhich: Euro 3,893 thousand (net of an impairment loss of Euro 230thousand recorded in the year ended December, 31, 2025) and Euro 703thousand attributable respectively to Gefran Schweiz AG and Gefran UKLtd, which have incurred significant losses in the current year and/or inprior years.
	In accordance with the International Accounting Standard "IAS 36 -Impairment of Assets", in the presence of indicators of a possibleimpairment, the Company's Management performed an impairment testto determine that the carrying amounts of the aforementionedinvestments are recorded in the financial statements as at December31, 2025 at a value not exceeding their recoverable amount.
	Following the impairment testing, approved by the Board of Directors atits meeting held on March 12, 2026, the Company recognized animpairment loss on the investment in Gefran Schweiz AG in the amountof Euro 230 thousand.
	The valuation process performed by Management regarding therecoverability of the carrying amounts of investments held in GefranSchweiz AG and Gefran UK Ltd, which is conducted through thedetermination of value in use, is complex and is based on assumptionsconcerning, among other things, (i) the forecast of expected cash flowsfrom the investments, with reference to the explicit business plans for2026-2028 and the terminal value, and (ii) the determination of anappropriate discount rate (WACC), and (iii) the estimate of long-termgrowth rate (g-rate).
	Given the subjectivity of the estimates relating to the determination ofthe cash flows considered and the key variables of the impairmentmodels, and in relation to the economic and financial performance ofcertain investee companies, we considered the impairment test to be akey audit matter in our audit of the Company's financial statements.
	Note "12. Equity investments in subsidiaries" in the specific notesexplanatory to the financial statements, included in the annual financial

BOARD OF STATUTORY AUDITORS' REPORT TO THE SHAREHOLDERS' MEETING OF GEFRAN S.P.A.

Accounts audit	Deloitte&Touche Spa	Parent Company	106
Accounts audit	Deloitte&Touche Spa	Subsidiaries	58
Accounts audit	Deloitte network	Subsidiaries	123
Sustainability reportaudit	Deloitte&Touche Spa	Parent Company	50
Total Euro/000			337

Accounts audit	Willi & Partners	Gefran subsidiarySchweiz AG
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ti	Chairman
Apa	Standing Auditor
	Standing Auditor

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Gefran EDITORIAL COORDINATION

ARTISTIC DIRECTION AND GRAPHIC PROJECT

GEFRAN S.p.A. Share capital 14,400,000 fully paid up.

Registered offices in Provaglio d'Iseo (BS), Via Sebina, no. 74 Tax code and Brescia Companies' Register No. 03032420170

www.gefran.com