Kafrit Industries (1993) Ltd. — Investor Presentation 2022

May 29, 2022

WELCOME TO KAFRIT GROUP

COMPANY PRESENTATION

Disclaimer

This presentation does not constitute an offering to purchase or sell securities of Kafrit Group Ltd. (the "Company") or an offer for the receipt of such offerings.

The presentation's sole purpose is to provide information. The information contained in the presentation and any other information provided during the presentation (the "Information") does not constitute a basis for investment decisions and does not comprise a recommendation, an opinion or a substitute for the investor's sole discretion. The Information provided in the presentation

concerning the analysis of the Company's activity is only an extract, and in order to receive a complete picture of the Company's activity and the risks it faces, one should review the Company's reports to the Israel Securities Authority and the Tel Aviv Stock Exchange.

The Company is not liable, and will not be held liable, for any damage and/or loss that may be caused as a result of use of the Information.

The presentation may contain forward-looking statements as defined in the Israeli Securities Law, 5728-1968. All forward-looking statements in this presentation are made based on the Company's current expectations evaluations and forecasts, and actual results may differ materially from those anticipated, in whole or in part, as a result of different factors including, but not limited to, changes in market conditions and in the competitive and business environment, regulatory changes, currency fluctuations or the occurrence of one or more of the Company's risk factors. In addition, forward-looking forecasts and evaluations are based on information in the Company's possession while preparing the presentation.

The Company does not undertake any obligation to update forward-looking forecasts and evaluations made herein to reflect events and/or circumstances that may occur after this presentation was prepared.

Our Place in the Supply Chain

3

We are here

01 ABOUT KAFRIT GROUP

KAFRIT GROUP IS A LEADING PRODUCER OF MASTERBATCHES AND COMPOUNDS FOR THE PLASTICS INDUSTRY

To be a preferred supplier of masterbatches and compounds for the plastic industry, providing our customer globally, innovative and quality solutions suitable to their need over time

Our new challenging Strategy for the next 5 years

Enhance our strong Business Portfolio while Increasing Profitability driven by a significant Transformation from a Production-based Company to a Customer-Centric Company, focused on Added Value Service

Must Win Battles	Marketing and Service	Colors	Business Units	Business Development & Innovation
Mission	Be the Best-in-Class Service and Solution Provider	Become a Multi-Local Player in Colors Segment	Improve Profitability and Strengthen Market position	Form & Execute Strategic Alliances generating significant added value
Our People and Structure	Build a Group Leadership Team, Leverage Knowhow and Synergies

Kafrit Sustainability Strategy for 2030

Our Sustainability aspirations are that our People, Products' design and our aligned Actions, together with our Stakeholders – will make a Better World.

Areas of Action	Operating Sustainably	Living Sustainably	Innovating Sustainably	Business Developing Sustainably
Mission	We continuously limit the negative impact our operations have on the environment	We work to ensure that our people are safe and act according to our values	We help our Customers to become more eco friendly through Product Innovation	We Balance our Portfolio through Relevant Business Development and Strategic Alliances
Report Sustainably	We measure our actions, setting long and short-term goals striving to achieve results and Report them

AROUND THE WORLD

LEGAL GROUP STRUCTURE

KAFRIT GROUP LEADERSHIP TEAM

02 PORTFOLIO

THE MEMBERS OF KAFRIT GROUP

APPLICATIONS

INJECTION MOLDING / BLOW MOLDING

CONSTAB AND CONPEEL COMPOUNDS

POLYCARBONATE AND PMMA SHEETS

POLYETHYLENE PACKAGING POLYPROPYLENE CAST AND CALENDER FILMS

ANTIMONY FREE / REDUCED ANTIMONY FR SOLUTIONS ECOCELL AGRICULTURAL FILM

HALOGEN FREE SOLUTIONS FOR SHEETS AND PIPES

BLOWING AGENTS

ANTIOXIDANTS

OPTIMIZING BOPP

ADDING VALUE TO FIBERS AND NONWOVENS

FUNCTIONALITY

ACID SCAVENGERS ANTIBLOCKING AGENTS ANTIFOGGING AGENTS ANTISLIP AGENTS ANTISTATICS CAVITATING AGENTS CLEANING COMPOUNDS COLOUR CONCENTRATES FILLERS FLAME RETARDANTS FOAMING AGENTS HYDROCARBON RESINS

MATT COMPOUNDS METAL DEACTIVATORS NUCLEATING AGENTS OPTICAL BRIGHTENERS PEEL COMPOUNDS PHARMACOPOEIA MB PROCESSING AIDS SLIP AGENTS SYNTHETIC PAPER COMPOUNDS THERMOSTABILISERS UV ABSORBERS UV STABILIZERS

WELL DIVERSIFIED PORTFOLIO

18

(*) Q1/2022 NIS Value Sales

03 PERFORMANCE HIGHLIGHTS

Q1 -2022 HIGHLIGHTS

264MNIS

NET REVENUE

23MNIS

OPERATING PROFIT

31MNIS

EBITDA

NET DEBT INCREASE

7MNIS

SAFETY PERFORMANCE STRIVING FOR CONTINUOUS IMPROVEMENT

22

OSHA = #LTA / 200KHours

04 Q1/2022 PERFORMANCE

The Company delivered strong value and margin growth in Q1

Consological Pol - 01 2024 87202
	M-ILS		Change
	2022	2021	2021
Volume Sales (Tone)	21,824	21,934	(0.5%)
Sales	264.0	228.5	15.6%
Materials	178.7	154.3	15.8%
Manufacture & Labor	34.3	28.9	18.5%
COST OF SALES	213.0	183.2	16.2%
GROSS PROFIT	51.0	45.2	12.8%
	19.3%	19.8%
Sale & Marketing	16.8	14.4	16.6%
General & Admin	11.0	9.6	14.2%
	23.3	21.3	9.6%
Operating Profit	8.8%	9.3%
EBITDA	31.1	28.0	11.1%
	11.8%	12.2%

Consolidated P&L – Q1 2022 vs 2021 Coping with Serious Supply chain issues

• Top Line Growth Driven by:
  • Rising selling prices to compensate for the continued rise in raw material prices, and rising electricity and transportation costs
  • The acquisition of the Swedish company
• The company was able to maintain the trading margin, which increased the gross profit
• The increase in Sales and Marketing expenses and General & Admin originated by the significant increase in transportation costs and the acquisition of the company in Sweden.
• The war between Ukraine and Russia had a nonsignificant impact on our sales

EBITDA growth driven by Margin improve and small Volume growth, with negative impact of Foreign Currencies (M – ILS)

Debt growth – driven by Inventory increase to cope with challenges in the Supply chain, and seasonality

SALES (M-ILS)

218.7 220.8 208.6 211.2 194.0 216.1 217.1 219.5 228.5 263.5 267.6 268.8 264.0

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022

Operating profit (M-ILS)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022

EBITDA (M-ILS)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022

Dividend distribution (M-ILS)

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022

Q2 2022 – As approved in BOD (26/05/2022)*