Untitled Annual Financial Report | 2021

CONTENTS

MANAGEMENT REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AUDITOR’S REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS
ANNUAL FINANCIAL STATEMENTS AND MANAGEMENT REPORT
AUDITOR’S REPORT ON THE ANNUAL FINANCIAL STATEMENTS
STATEMENT BY THE EXECUTIVE BOARD

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Raul Fernandez, RC16 25, Tech3 KTM, MotoGP, Team Presentation 2022 © Philip Platzer
R Raymon TrailRay E 10.0, TrailRay E 11.0, FullRay E-Seven 8.0 © R Raymon/Janik Steiner

ANNUAL REPORT 2021

MANAGEMENT REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS

DEVELOPMENT OF THE PIERER MOBILITY GROUP ........................................... 96
ECONOMIC ENVIRONMENT AND MARKET DEVELOPMENT ................................ 99
FINANCIAL PERFORMANCE INDICATORS ..................................................... 100
NON-FINANCIAL STATEMENT......................................................................... 105
RESEARCH & DEVELOPMENT AND NEW MODELS .......................................... 106
OPPORTUNITIES AND RISK REPORT ........................................................... 108
DISCLOSURES PURSUANT TO SECTION 243A (1) OF THE AUSTRIAN COMMERCIAL CODE (UGB) .......................................................... 113
MAIN FEATURES OF THE INTERNAL CONTROL SYSTEM SECTION 243A (2) OF THE AUSTRIAN COMMERCIAL CODE (UGB) .............................................. 116
OUTLOOK ...................................................................................................... 118

MANAGEMENT REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31 ST 2021 OF PIERER MOBILITY AG, WELS

1. DEVELOPMENT OF THE PIERER MOBILITY GROUP

THE COMPANY

The PIERER Mobility Group is Europe‘s leading manufacturer of powered two-wheelers (PTWs). With its KTM, HUSQVARNA Motorcycles, and GASGAS motorcycle brands, it is one of the technology and market leaders in Europe, especially when it comes to premium motorcycles. In addition to vehicles with combustion engines, the product range of the PIERER Mobility Group also includes zero-emission two-wheelers with electric powertrains (in particular e-motorcycles and e-bicycles). As a pioneer in electric mobility of two-wheelers, the group, with its strategic partner Bajaj, has created the basis for assuming a leading global role in the low-voltage range (48 volts). Establishing the (e-)bicycle division with PIERER E-Bikes GmbH was another important move in also stepping up its activities in the area of electric bicycle mobility. The bicycles will be marketed under the HUSQVARNA E-Bicycles, R Raymon, and GASGAS E-Bicycles brands and, from 2022, also under the FELT Bicycles brand in order to gain a share of the attractive market growth in this segment and to develop into a significant international player in this field.

Since November 14th 2016, the shares of PIERER Mobility AG have had a primary listing in the International Reporting Standard of the SIX Swiss Exchange. On March 29th 2017, the shares of PIERER Mobility AG were included in the Swiss Performance Index (SPI) of the SIX Swiss Exchange. Since March 3rd 2020, the shares of PIERER Mobility AG have also been listed on the regulated market of the Frankfurt Stock Exchange (General Standard). As of March 1st 2022, trading has also commenced on the Prime Market of the Vienna Stock Exchange, which means that the shares of PIERER Mobility AG are listed in the top segment of the Vienna Stock Exchange. This step is intended to satisfy the great level of interest among investors in Austria and abroad.

DEVELOPMENT OF SALES AND REVENUE IN THE 2021 FINANCIAL YEAR

Despite supreme challenges in the international supply chains and the risks arising from the COVID-19 pandemic, the PIERER Mobility Group improved its revenue by about 1/3 and achieved record revenue of € 2,041.7 million (previous year: € 1,530 million). With 332,881 motorcycles sold under the KTM, HUSQVARNA and GASGAS brands (previous year: 270,407), PIERER Mobility increased its sales by 23%. This was driven by the high global demand for motorcycles. In addition, the Bicycle Division with its HUSQVARNA, R RAYMON and GASGAS brands achieved sales growth of more than 40%, selling 102,753 bicycles (previous year: 73,277) of which 76,916 were e-bicycles (previous year: 56,064). In Europe, unit sales to dealers were 120,049 motorcycles and 101,437 bicycles. Almost two thirds of the motorcycles (212,832 units) were sold in markets outside Europe, and in particular in North America, India, and Australia. The implementation of the global product strategy and the expansion into further Asian and South American markets were pursued consistently over the past financial year. A similar picture to wholesale is also reflected in the international retail market environment, where the European motorcycle market grew by approximately 8% to 740,000 units. The market share of all three motorcycle brands was therefore 11.5% in 2021. Both the U.S. and Australian markets also performed positively, each recording significant double-digit market share figures of 11.3% and 19.7%, respectively. The Indian motorcycle market as a whole is on a slight upswing (+2%). Bajaj sold around 60,000 KTM and Husqvarna motorcycles in India, resulting in a market share of 7%. The PIERER Mobility Group thus reaffirmed the strong registration figures of the previous year and was able to maintain global registrations at a high level.

ACQUISITION OF FELT BICYCLES

In the 2021 financial year, the bundling of the operating activities of the Bicycle Division was successfully completed in PIERER E-Bikes GmbH. An important highlight is this segment was the acquisition of the US brand “FELT” in November. FELT Bicycles was founded in 1991 in California, USA, and is known for manufacturing high-performance road, triathlon, track, cyclocross and gravel bikes. FELT bikes have been ridden to stage wins in Grand Tours and earned record-breaking triathlon world championship titles, Olympic gold medals and world championship titles on a variety of different terrains. The process of integrating the Felt brand into PIERER E-Bikes GmbH has already begun.

SIMPLIFICATION OF THE OWNERSHIP STRUCTURE WITH BAJAJ

The completion of the simplification of the ownership structure between the Pierer Group and the Indian Bajaj Group in Q4 2021 should be seen as an important milestone for the company. As planned, in a first step the Bajaj Group contributed a 46.5% share package in the operating subsidiary KTM AG to Pierer Bajaj AG, the majority shareholder of PIERER Mobility AG held by the Pierer Group. In return, Bajaj received a 49.9% stake in Pierer Bajaj AG. In a second step, this 46.5% KTM share package now held by Pierer Bajaj AG was contributed to PIERER Mobility AG as part of an almost 50% capital increase through contributions in kind. 11,257,861 new shares were issued in the process. This capital increase through contributions in kind from the authorized capital amounting to € 895 million, corresponding to exactly 49.9% of the existing share capital, was carried out with exclusion of subscription rights. Only Pierer Bajaj AG was admitted to subscribe. As a result of this “uplifting project” including the capital increase, Pierer Mobility’s stake in the operating KTM AG (after acquisition of the remaining approximately 1.5% KTM AG shares held by Bajaj) increased to 99.75% (previous year: 51.71%). The remaining 0.25% will be transferred to the main shareholder PIERER Mobility AG in 2022 in return for an appropriate cash settlement (squeeze-out). This means a clear structure will be created in the PIERER Mobility Group on a sustainable basis and, in the process, the minority interests (“Minorities”) will be reduced to a negligible level.

STRATEGIC PARTNERSHIPS

As a pioneer in the electrification of motorized two-wheelers, the PIERER Mobility Group already generated sales revenues of around € 181 million (+55%) with electrically powered two-wheelers (e-motorcycles and e-bicycles) in 2021. In this context, the two strategic partnerships in the field of e-mobility which were entered into in 2021 with Bajaj on the one hand and VARTA on the other hand should be highlighted. PIERER Mobility AG and Bajaj Auto Limited, India’s second largest motorcycle manufacturer, have now consolidated their 15-year strategic partnership in the international motorcycle industry to include the development of electric products in the two-wheeler sector. This is in order to meet the growing demand for innovative e-mobility concepts. Both companies are exploring common themes, such as the zero-emission exhaust system, low maintenance and durability of light electric vehicles in urban environments and metropolitan areas. This strategy also includes an open approach to different battery solutions to make use of both integrated and removable batteries. Another strategic cooperation for the development of high-efficiency battery systems in the electric two-wheeler sector was agreed in March 2021 by PIERER Mobility AG and VARTA AG, the leading European manufacturer of Li-ion cells and a global innovation and technology leader. VARTA and KTM are keen to send a strong signal both within and from Europe with highly efficient battery systems. The objective is to cooperate in the areas of research, development, production, marketing and sales as well as in the area of take-back, recycling and the 2nd life of batteries. The cooperation partners see great potential for the development of a platform battery for lightweight electric vehicles in the 48 volt range with peak performances of up to around 20 kW. To expand the bicycle and e-bike production capacity, in 2021 a 50:50 joint venture was established with MAXCOM Ltd. for e-bike production in Plovdiv.

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9# 10-K Filing

Joint Ventures and Strategic Partnerships

A state-of-the-art e-bike production and assembly facility is being built over an area of 130,000 m². International suppliers will also be given the opportunity to locate themselves at the site. Commissioning is scheduled for the second half of 2023. The annual production capacity will be around 350,000 units. PIERER Mobility AG is contributing all of its vehicle development and production expertise to the joint venture. MAXCOM Ltd. is one of the largest bicycle manufacturers in Eastern Europe and a member of the MAXEUROPE Group in Bulgaria. Maxcom already produces R RAYMON bicycles for PIERER E-Bikes GmbH, and increasingly also Husqvarna E-Bicycles. CFMOTO should also be mentioned as another important joint venture partner. The deeper cooperation with partner CFMOTO to establish an additional production facility and supply chain in China has started successfully with the assembly of around 10,000 mid-range motorcycles in 2021. At the joint venture factory in Hangzhou, the 790 cc twin-cylinder platform will be used to create a model family for new, affordable mid-range Duke and Adventure models. Around 25,000 motorcycles are set to be produced in 2022.

INCREASE IN GLOBAL BRAND AWARENESS THANKS TO SENSATIONAL MOTORSPORT SUCCESSES

The major successes achieved in motorcycle racing in 2021 deserve special mention. Under the three KTM, Husqvarna, and GasGas brands, 21 world championship titles were won in both road and off-road racing. Jeffrey Herlings secured the MX GP world championship crown riding a KTM bike, Coober Webb (also KTM) was crowned Supercross Champion and Billy Bolt (Husqvarna) won the Hard Enduro Series, to name just a few. In road racing, two KTM riders triumphed in Moto2™, Remy Gardner ahead of his teammate Raul Fernandez, both of whom are also moving up to MotoGP™ in 2022. In January 2022, Sam Sunderland won the prestigious Dakar Rally for the group riding GasGas. Matthias Walkner, the reigning Cross Country Rallies World Champion, claimed the second podium spot, finishing third in the standings.

COVID-19 PANDEMIC

In the 2021 financial year, there were no significant interruptions to production at the Austrian production sites. However, the occasionally high infection rate and the resulting temporary absence of employees posed significant challenges for production and logistics. Due to the high flexibility of employees, an additional expansion of employee numbers and the introduction of additional shifts, these challenges were largely overcome. There was some instability and some delays in international supply chains. The recovery of the global economy led to an increase in demand and bottlenecks in freight containers and therefore a significant increase in freight costs. The risk detection system (revised in the past year) for identifying global events with a direct or indirect impact on the supply chain, has been improved in a goal-oriented manner. The proven supply chain from supplier to production sites in Mattighofen and Munderfing is primarily intended to ensure parts availability at economically competitive costs, but also to create a basis for the parties involved as suppliers and customers to establish or expand long-term business relationships. In order to be able to achieve these goals, a wide range of employees from the purchasing, quality management and research & development departments contribute their expertise even before the award of a contract for a new purchased part to a supplier company in a selection process. These proven relationships played a major part in ensuring that the global shortage of resources and bottlenecks in the supply chains had only a minor impact on the business operations of the group.

Motorcycle production at our strategic partner Bajaj ran in a largely normal manner and ensured the supply of small-engine KTM and Husqvarna street motorcycles (up to 400 cm³) for the worldwide sales of the PIERER Mobility Group. Relaxation of the national lockdown measures in some countries resulted in partial reopening of the global dealer network. The continued high demand for powered two-wheelers has resulted from a significant change in consumer behavior with regard to the use of public transport and an unwillingness to travel. The recovery effects recorded in retail sales continued in the past year in all relevant sales markets.

The effects of the outbreak of the COVID-19 pandemic had already been recognized by management at an early stage in 2019. KTM responded in a consistently proactive manner to the COVID-19 crisis in line with national regulations to restrict the spread of the virus and implemented these regulations in full. Production in 2021 proceeded continuously and without any direct restrictions due to the COVID-19 pandemic, allowing motorsport and marketing activities to significantly increase once again. The lockdown measures at the end of 2021 had only a minor impact; production was able to continue due to the measures taken and expansion of working from home reduced the number of employees on site and therefore the risk of infection. The supply of spare parts to end customers was guaranteed at all times. Temporary delays in investment and development projects, as occurred in the year before, were avoided in 2021.

Liquidity developed in a very positive manner in the course of business. In addition to the issue of a registered bond in the amount of € 30 million in May 2021, liquidity was further strengthened by the taking out of a loan with the European Investment Bank amounting to € 50 million. Aided by the positive development of retail sales and the working capital optimizations established in previous years and pursued consistently since, a free cash flow of € 172.2 million (previous year: € 165.8 million) was generated. Net financial debt was further reduced by € 122.5 million to € 189.9 million (previous year: € 312.4 million).

In order to minimize the risk of the COVID-19 pandemic and to ensure that production capacities were kept running, a comprehensive prevention concept was developed in 2021. This is guided by and implements the required regulatory measures. Various other precautions were taken to protect the health of employees. These included social distancing rules, regular disinfection of work areas as well as hygiene measures and restrictions on access depending on status as vaccinated, recovered or having recently tested negative. Due to the positive reception of working from home, it was retained on a flexible basis. A wide range of COVID-19 vaccination measures were offered to employees that was maintained continuously over the entire financial year and was in high demand among employees.

9999 ANNUAL REPORT 2021

2. ECONOMIC ENVIRONMENT AND MARKET DEVELOPMENT

SARS-CoV-2 continues to influence global economic activity. It was identified at the end of December 2019 and has been present in all countries of the world in particular since March 2020. Governments all over the world have taken measures to slow down or prevent the spread and to mitigate the economic consequences of the measures required to prevent infection. Setbacks in the fight against the pandemic are not the only cause for concern, but also the associated shortages of resources in the supply chains, as well as the rising and continuing inflation figures.

The global economic situation is highly uncertain, and the existing disruptions to economic recovery have increased, particularly in relation to the course of the pandemic and access to vaccines. The current assessment of the International Monetary Fund (IMF) of January 2022 is similarly still subject to great uncertainty. According to this forecast, the global economy will grow by 4.4% in 2022. For industrialized countries, a growth rate of 3.9% for 2022 and 2.6% for 2023 is forecast. Growth of 3.9% is expected for the euro area in 2022. For 2023, the IMF anticipates global economic growth of 3.8%, and for the euro area growth of 2.5%. For emerging markets and developing economies, a growth in economic output of 4.8% and 4.7% is expected for 2022 and 2023 respectively. For China, a growth rate of 4.8% for 2022 and 5.2% for 2023 is forecast. India is also expected to develop positively, with economic output expected to increase by 9.0% for 2022 and by 7.1% for 2023.

In the 2021 financial year, the PIERER Mobility Group was able to reaffirm the excellent vehicle registration figures of the previous year and maintain global registrations at a high level. The motorcycle market environment increased by approx. 9% compared to 2020.

In Europe, the motorcycle market grew to a volume of approx. 740,000 new registrations as of December 31st 2021, which corresponds to an increase of 8%. The market share of KTM, Husqvarna, and GASGAS motorcycles registered for road use is 11.5%. While Italy (+28%) and France (+12%) recorded increases both in the overall market and in group registrations (Italy +14%, France +10%), demand for motorcycles in Germany, one of the biggest relevant markets for the group in Europe, fell by 9%.

In the USA, the largest single motorcycle market for PIERER Mobility, the motorcycle market continued the positive growth of the previous year and recorded a volume of around 440,000 motorcycles (previous year: approx. 398,000) in both offroad and road segments in 2021 – an increase of 10%. The three motorcycle brands of the PIERER Mobility Group once again enjoyed a significant double-digit market share of 11.3% (previous year: 11.6%). Developments in Canada were almost identical and brought about an increase of 10% in the motorcycle market, with a market share of 14.1% in the 2021 financial year (previous year: 14.5%).# BUSINESS DEVELOPMENT AND ANALYSIS OF EARNINGS RATIOS

The PIERER Mobility Group can look back on a new record-breaking year in 2021. The main challenges for the successful continuation of our growth trajectory were the unstable international supply chains, securing the required production capacities as flexibly as possible and minimizing the risks arising from the COVID-19 pandemic for the employees. In 2021, thanks to the high market demand for Powered Two-Wheelers (PTWs) and active management of the challenges outlined above, the PIERER Mobility Group achieved record growth in both revenue and earnings despite the challenging situation.

In the 2021 financial year, the PIERER Mobility Group generated revenues of € 2,041.7 million (+33.4%), thus improving its revenue by € 511.3 million compared to the previous year. Approximately 95% of revenues were earned outside of Austria. Looking at different regions, 56.0% of revenues were generated in Europe (-1.2 percentage points year-on-year), 22.9% in North America including Mexico (-1.5 percentage points year-on-year), and 21.1% in the rest of the world (+2.7 percentage points year-on-year).

Due to the high demand for motorcycles and e-bicycles worldwide, a total of 663 employees were added to the workforce in the past financial year, bringing the total number of employees at the end of the year to 5,249. Of these, 4,340 are employed in Austria.

The earnings before interest, taxes, depreciation and amortization (EBITDA) of € 332.2 million are around € 100 million higher than the previous year’s figure of € 233.5 million. The EBITDA margin is 16.3%. The group increased EBIT by around 80% to € 193.5 million (previous year: € 107.2 million), which equates to an EBIT margin of 9.5%. In addition, the net result after tax was more than doubled, reaching € 142.9 million in the 2021 financial year (previous year: € 69.5 million).

Sales Figures

The sales figures for PTWs – motorcycles of the KTM, Husqvarna Motorcycles, and GASGAS brands as well as e-bicycles (excluding non-e-bicycles) – are distributed as follows:

Brand	Sales 2021 PTWs (units)	Sales 2020 PTWs (units)
KTM	409,797	326,471
Husqvarna Motorcycles	249,290	212,713
GASGAS	60,801	49,046
E-Bicycles	22,790	8,648
Total	742,678	596,478

The two segments “Motorcycles” and “E-Bicycles” represent the main operational areas of the PIERER Mobility Group, the development of which is discussed below.

MOTORCYCLES

The revenue drops recorded in 2020 owing to interruptions to production caused by the COVID pandemic were compensated for in the 2021 financial year and total revenue was significantly increased. In the KTM group, revenue of € 1,876.4 million was achieved in the past financial year (previous year: € 1,414.0 million), which corresponds to an increase in revenue of 32.7%. KTM achieved EBITDA of € 325.2 million in the 2021 financial year (+44.1% compared to the previous year) and EBIT of € 192.8 million (+83.1% compared to the previous year). This corresponds to an EBITDA margin of 17.3% (previous year: 16.0%) and an EBIT margin of 10.3% (previous year: 7.4%). The net result after tax was € 146.1 million (previous year: € 71.2 million).

In North America, KTM recorded revenue growth of 24.8% to € 466.1 million. This meant that 24.8% of revenue was generated in North America (previous year: 26.4%). In Europe, revenue increased by 29.1% to € 980.8 million compared to the previous year, which corresponds to a share of 52.3% (previous year: 53.7%). Revenue also increased in other countries by 52.9% to € 429.4 million compared to the previous year.

MARKET DEVELOPMENT

Despite long-lasting lockdowns in Australia, this market also grew significantly both in relation to the motorcycle market as a whole (2021: +8%; previous year: +17.9%) and for KTM, Husqvarna, and GASGAS products (2021: +4%; previous year: +46.5%), which translates to a market share of 19.7% (previous year: 20.4%). While the year before was heavily affected by the coronavirus pandemic, the situation in the market in India recovered significantly in 2021, with sales growing by 2% to around 9.6 million units in the overall motorcycle market. In the relevant S2/S3 segment, in which the KTM and Husqvarna Motorcycles brands have a market share of 7%, approximately 60,000 motorcycles were sold via the distribution channels of our strategic partner Bajaj, as was the case in the previous year.

The market environment for motorcycles in Argentina and Colombia, which are the core countries relevant to the group in South America, developed very positively (overall market: approx. 600,000 units). In the 2021 financial year, the motorcycle market in Argentina grew by 29%, with sales of KTM and Husqvarna brand motorcycles rising by almost 70%. This resulted in a market share of 4%. There was even stronger growth in Colombia, where the overall market grew by 43%. In the 2021 financial year, the PIERER Mobility Group’s motorcycle brands recorded a 76% increase in registrations and a market share of 2% in Colombia.

E-MOBILITY

The e-mobility market has great potential for growth. E-bicycles represent a healthy, sustainable, and individual mode of transport. They are an increasingly important component of modern mobility concepts. The popularity of e-bicycles, in particular, is growing dynamically and now encompasses all model groups in the bicycle sector. E-bicycles enable longer distances and higher average speeds, creating new mobility options in urban and rural areas. It is evident that high-quality brand-name products are also gaining ground in the bicycle market. Consumers are proving to be more quality aware and more environmentally aware, which directly results in higher demand on the bicycle market. This has proven to be a trend, especially in terms of data for the German sales market, which, according to recent scientific findings, depends not least on the changing population structure as well as the general level of education, which is becoming more aware of environmental issues.

According to reports from the German Two-Wheeler Industry Association (ZIV), 5.04 million units (e-bicycles and non-e-bicycles) were sold in Germany in 2020, a year-on-year increase of +16.9%. With conventional bicycles down by -7.2%, the strong growth was primarily attributable to the e-bicycles segment. In its report on the first half of 2021, ZIV confirms these positive trends for the e-bicycle market, while the forecast decline in the sales figures for bicycles overall is exclusively due to the decline in conventional bicycles. For example, ZIV reports that 1.95 million e-bicycles were sold in Germany in 2020 (2019: 1.36 million). Accordingly, the market share of e-bicycles in 2020 was 38.7% (2019: 31.5%). In the medium term, a market share of 40% to 50% of the total bicycle market in Germany is forecast for e-bicycles.

Similarly, a trend study by the auditing and consulting firm PwC indicates that the bicycle market will grow globally at an average rate of approx. 5.5% annually in the years ahead. This development is largely driven by the strong growth in the sales figures for e-bicycles (7.4% per annum according to the study). According to the study, the greatest potential for growth lies in the East Asian as well as the European and North American markets, with an estimated sales volume of approximately 210.4 million bicycles (e-bicycles and non-e-bicycles; estimated value of the sales volume: approximately EUR 80 billion) sold worldwide in 2025.

3. FINANCIAL PERFORMANCE INDICATORS

KEY FINANCIAL PERFORMANCE INDICATORS: EARNINGS RATIOS

Metric	2020	2021	CHANGE IN %
Revenue in € million	1,530.4	2,041.7	33.4%
EBITDA in € million	233.5	332.2	42.3%
EBITDA margin in %	15.3%	16.3%
Result from operating activities (EBIT) in € million	107.2	193.5	80.5%
EBIT margin in %	7.0%	9.5%

OTHER FINANCIAL FIGURES: EARNINGS RATIOS

Metric	2020	2021	CHANGE IN %
Earnings after taxes in € million	69.5	142.9	>100.0%
Earnings after minorities in € million	34.9	82.5	>100.0%

BALANCE SHEET RATIONS

Metric	12/31/2020	12/31/2021	CHANGE IN %
Balance sheet total in € million	1,686.0	2,033.7	20.6%
Equity in € million	654.1	765.6	17.0%
Equity ratio in %	38.8%	37.6%
Working capital employed 1) in € million	181.5	160.5	-11.6%
Net debt 2) in € million	312.4	189.9	-39.2%
Gearing 3) in %	47.8%	24.8%

CASH-FLOW UND CAPEX

Metric	2020	2021	CHANGE IN %
Cash flow from operating activities in € million	312.8	367.4	17.5%
Cash flow from investing activities in € million	-147.0	-195.1	32.7%
Free cash flow 4) in € million	165.8	172.2	3.9%
Cash flow from financing activities in € million	-104.7	-27.6	-73.6%
Capital expenditure 5) in € million	150.2	178.5	18.8%

VALUE CREATION

Metric	12/31/2020	12/31/2021
ROCE (Return on Capital Employed) 6) in %	9.7%	17.4%
ROE (Return on Equity) 7) in %	10.9%	20.1%
ROIC (Return on Invested Capital) 8) in %	7.7%	13.0%

1) Working capital employed = inventory + trade receivables - trade payables
2) Net financial debt = financial liabilities (current, non-current) - cash
3) Gearing = net financial debt / equity
4) Free cash flow = cash flow from operating activity + cash flow from investing activity
5) Additions to property, plant and equipment and intangible assets as per statement of changes in non-current assets; excluding lease additions (IFRS 16) in the amount of € 24.6 million (previous year: € 19.5 million)
6) ROCE: EBIT / average capital employed; capital employed = property, plant and equipment + goodwill + intangible assets + working capital employed
7) ROE = net result after tax / average equity
8) ROIC = NOPAT / average capital employed; NOPAT = EBIT – taxes

Notes:
1. Related to the key sales markets of the KTM group: DE, FR, IT, UK, ES, SE, BE, NL, AT, CH, FL, DK, NO, GR, PL, SL, HU, BALTIC, USA, CAN, AUS, NZ, JP, SA.
2. Motorcycles = 120 cm³ excluding Motocross, scooters and ATVs, including electric motorcycles in the markets DE, FR, IT, UK, ES, SE, BE, NL, AT, CH, FI, NO, BALTIC
3. Motorcycles = 120 cm³ including Motocross, excluding scooters and ATVs, including electric motorcyclesThe share of revenue generated in other countries was 22.9% (previous year: 19.9%). With 249,290 KTM motorcycles sold, 60,801 HUSQVARNA motorcycles sold and 22,790 GASGAS motorcycles sold in the 2021 financial year, the KTM group sold a total of 332,881 motorcycles (+23.1% year-on-year; taking into account the motorcycles sold in India and Indonesia by partner Bajaj), thereby consolidating its presence in the key motorcycle sales markets with its three motorcycle brands. In the European sales regions, unit sales were 120,049 motorcycles (+23.3%). Significant growth was also recorded by the North American sales subsidiary with 65,792 motorcycles sold (+24.6%), and in Australia sales increased by 25.7% to 20,811. The strongest growth potential was seen in South America (+62.5%) with 32,562 and in Asia (+55.8%) with 29,847 motorcycles sold.

UNIT SALES BY REGIONS FY 2021

36.1% Europe
19.8% North America (incl. Mexico)
18.1% Indien / Indonesia (by Bajaj)
26.0% remaining global region

REVENUE BY REGIONS FY 2021

52.3% Europe
24.8% North America (incl. Mexico)
22.9% remaining global region

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ANNUAL REPORT 2021

In the 2021 financial year, 178,992 motorcycles were manufactured at the Mattighofen production site. Compared to the previous year, this constitutes an increase of 38,740 units, or +27.6%. Taking into account the small-engine KTM and Husqvarna models produced by our partner Bajaj Auto Ltd. in India and the GASGAS Trials produced in Spain, 323,931 vehicles (+22.1%) were manufactured worldwide.

E-BICYCLES

In the Bicycle Division, activities in 2021 focused on establishing the three Husqvarna E-Bicycles, R Raymon and GasGas brands, as well as on further technical development and enhancing the quality of the product range. R RAYMON offers bicycles as well as e-bikes for a variety of target groups: from children’s bikes to racing bikes, from city e-bikes to sports E-MTBs. Husqvarna’s product range now covers the entire spectrum of e-mobility. GASGAS bikes were officially launched in April 2021. The Spanish own brand opened a new chapter in the field of e-mobility and now intends to give even more off-road enthusiasts the opportunity to share in the fun of off-road riding. With the various brands and the product range now even more broadly diversified, it will be possible to cater for this highly differentiated market in an optimum way. The global COVID-19 pandemic has increased consumer demand for personal transportation and sports solutions. In addition, consideration of sustainability issues is making consumers focus more on the need for zero-emission transportation. E-bikes in particular are proving to be especially popular and attractive to customers. The PIERER E-Bikes Group was able to take advantage of this, hold its own with its brands in a highly competitive market and continue growing.

In the 2021 financial year, revenue of € 162.7 million was generated in the e-bicycles segment (previous year: € 112.5 million). This represents a year-on-year increase in revenue of almost 45%. EBITDA in 2021 was € 11.4 million (previous year: € 6.5 million) and EBIT was € 7.0 million (previous year: € 2.2 million). This corresponds to an EBITDA margin of 7.0% (previous year: 5.8%) and an EBIT margin of 4.3% (previous year: 2.0%). The net result after tax was € 5.0 million (previous year: € 0.3 million). With 76,916 e-bicycles (+37.2%) and 25,837 non-e-bicycles (+50.1%), the Bicycle Division was able to achieve sales growth with the HUSQVARNA, R RAYMON, and GASGAS brands of more than 40% in total and has already sold 102,753 bicycles (previous year: 73,277). Of the e-bicycles sold in the 2021 financial year, 40.8% were sold under the Husqvarna E-Bicycles brand, 53.3% under the R RAYMON brand, and 5.9% under the GASGAS brand. The sales of non-e-bikes were entirely attributable to the R RAYMON brand. Around 76% of sales were in the DACH region.

UNIT SALES BY REGIONS FY 2021

76.1% DACH region
22.6% remaining Europe
1.3% remaining global region

REVENUE BY REGIONS FY 2021

70.7% DACH region
24.9% remaining Europe
2.1% remaining global region

104

STATEMENT OF FINANCIAL POSITION ANALYSIS

The balance sheet structure of the PIERER Mobility Group is as follows:

	2020	%	2021	%
Non-current assets	942.0	55.9%	992.8	48.8%
Current assets	744.0	44.1%	1,040.9	51.2%
Assets	1,686.0	100.0%	2,033.7	100.0%
Equity	654.1	38.8%	765.6	37.6%
Non-current liabilities	581.4	34.5%	649.5	31.9%
Current liabilities	450.5	26.7%	618.7	30.4%
Equity and liabilities	1,686.0	100.0%	2,033.7	100.0%

The balance sheet total of the PIERER Mobility Group increased by 20.6% from € 1,686.0 million to € 2,033.7 million as of December 31st 2021 compared to the consolidated financial statements as of December 31st 2020. Non-current assets increased from € 942.0 million to € 992.8 million in 2021, representing an increase of € 50.8 million or 5.4%. The increase was largely due to the level of investment being higher than depreciation and amortization, especially in the area of development projects, and the resulting increase in intangible assets. Within current assets, cash in particular increased by € 155.2 million and stock by € 106.4 million. This was due in particular to the build-up of stock of unfinished products, raw materials and supplies. Overall, this resulted in a significant increase in current assets of 39.9% to € 1,040.9 million. Current liabilities increased by € 168.2 million to € 618.7 million (+37.3%) in the past financial year. The increase is mainly due to the increase in trade payables amounting to € 133.5 million. Other increases related, among other things, to sales bonuses and employee benefits. Non-current liabilities increased by 11.7% to € 649.5 million, largely as a result of borrowings. In May 2021, KTM AG issued registered bonds with a term of 12 years at a nominal value of € 30 million. In addition, a loan of € 50 million was taken out from the European Investment Bank in December 2021. Equity increased by € 111.4 million to € 765.6 million in the 2021 financial year. On the one hand, equity was boosted by the pleasing net result after tax of € 142.9 million and the sale of treasury shares amounting to € 13.6 million. On the other hand, dividend payments amounting to € 24.4 million and the acquisition of shares in subsidiaries (increase in shares in KTM AG and KTM Technologies GmbH) totaling € 30.5 million led to a reduction in equity. The other effects mainly related to the recognition in equity of foreign currency differences, the valuation of financial instruments and the re-valuation of the net defined benefit liability. At 37.6%, the equity ratio reported as of December 31st 2021 was lower than the previous year’s figure of 38.8% due to the increase in the balance sheet total described above.

LIQUIDITY ANALYSIS

Cash flow from operating activities amounted to € 367.4 million in the 2021 financial year, which was up 17.5% on the previous year’s figure of € 312.8 million, and this was mainly attributable to the positive operating earnings development (EBITDA +€ 98.7 million compared to the same period in the previous year). The cash outflow from investments amounted to € -195.1 million and was significantly higher overall than the previous year’s figure of € -147.0 million. This increase was mainly due to the higher payments for the acquisition of intangible assets and property, plant and equipment (effect € -34.1 million). Due to the excellent result and the low working capital level, a strong free cash flow of € 172.2 million was generated, corresponding to 8.4% of ‘revenue. Free cash flow increased by a total of € 6.4 million compared to the same period in the previous year.

105

ANNUAL REPORT 2021

After taking into account the cash flow from financing activities of € -27.6 million, cash and cash equivalents increased by € 155.2 million (including foreign currency effects of € 10.6 million) to € 373.5 million compared to December 31st 2020. Thanks to the strong equity base and long-term financing, sufficient liquidity reserves are available on a sustainable basis.

INVESTMENTS

In the current financial year, total investments in the PIERER Mobility Group amounted to € 203.1 million (previous year: € 169.7 million) including IFRS 16 lease additions of € 24.6 million (previous year: € 19.5 million). The investments excluding leasing projects were divided between development projects (incl. tools), property, plant and equipment and intangible assets as follows::

23.5 intangible assets
15.8 property, plant and equipment
110.9 R & D (incl. tools)

FY 2020

178.5 Mio. Euro
17.5 intangible assets
29.9 property, plant and equipment
131.1 R & D (incl. tools)

FY 2021

Despite the COVID-19 pandemic, investments in the (further) development of existing and new models and in electric mobility have top priority. Expenditure on investments in research and development will therefore remain at the already high level of previous years on a sustained basis and this represents one of the key factors for the group’s success. At 73%, the proportion of investments in development projects (incl. tools) compared to total investments is slightly below the previous year’s figure of 74%. Investments in infrastructure (property, plant and equipment) accounted for 17% (previous year: 10%) of total investments. Intangible assets (trademark rights, IT, licenses) accounted for a further 10% (previous year: 16%). In the previous year, investments in intangible assets largely included the acquisition of the trademark rights to “GASGAS” amounting to around € 14 million. The main expansions to infrastructure at our Austrian sites in the 2021 reporting year involved the expansion of the logistics center (scheduled completion in 2022) and the newly built training center at the Munderfing site.With the newly created “Production Academy” in Mattighofen, massive investments have also been made in the training and further education of production employees. In addition, the new GASGAS production site in Terrassa, Spain was expanded.

4. NON-FINANCIAL STATEMENT

The company prepared a consolidated non-financial report for the PIERER Mobility Group in accordance with Section 267a of the Austrian Commercial Code (UGB) for the 2021 financial year. This report contains information about concepts, non-financial risks, due diligence processes as well as results and performance indicators with regard to environmental, social and employee issues, respect for human rights, and the fight against corruption and bribery. This report has been reviewed by the Supervisory Board in accordance with Section 96 of the Austrian Stock Corporation Act (AktG) and is available online at https://www.pierermobility.com/en/sustainability/sustainability-reports.

The Corporate Governance Report is available on the Company’s website at https://www.pierermobility.com/en/investor-relations/corporate-governance

106

ANNUAL REPORT 2021

5. RESEARCH & DEVELOPMENT AND NEW MODELS

PIERER Mobility AG intends to continue to expand its pioneering role in relation to technology, sales and image, especially in the motorcycle world. We have been particularly focused on the area of research and development for several years. The result of the R&D strategy we have pursued is innovative products, which meet our customers’ high expectations in technology and performance. Thanks to the globally active research and development organization, the PIERER Mobility Group has a network of highly qualified employees – for instance in the construction, computation and simulation sectors. This network is supported by the in-house machinery and equipment that performs the production, construction and validation of newly developed prototypes.

Research and development expenses (before capitalization of development services) in the PIERER Mobility Group in the 2021 financial year amounted to € 162.4 million (previous year: € 137.7 million), which corresponds to 8.0% (previous year: 9.0%) of revenue. The products of all group companies operate at a very demanding performance level, which is why customers demand ongoing development and evolution.

In the research and development department, the PIERER Mobility Group had as of December 31 in the 2021 financial year 976 employees (previous year: 808 employees), which corresponds to 18.6% of the total workforce. Around 6.4% of total revenue was invested in research and development (-0.8 percentage points compared to the previous year). The research and development department is a global organization, with decentralized locations in Europe (in particular Austria and Spain), America and Colombia. The development programs are managed centrally at the research and development headquarters of KTM AG in Mattighofen and Munderfing. A large proportion of the employees from the research and development department are located here over a floor space of more than 20,000 m².

Focusing on the power range from 250 W to 11 kW, the group is taking the next steps to intensify research & development (R&D) in the field of electric mobility and is pressing ahead at full speed in pursuing its vision to become the global leader in the field of electrically powered two-wheelers (PTW). For example, in the reporting year all R&D activities were combined and expanded further into their own research and development company – KTM Forschungs & Entwicklungs GmbH (KTM F&E GmbH) – which will ensure that KTM is always able to keep up with the ever-increasing pace of technological development.

A special focus of the past year was making the move to the newly developed R&D location in Anif near Salzburg, which, in addition to the E-drive development division within F&E GmbH, also provides KTM Technologies GmbH with space for further growth. The investment volume for the 7,780 m² e-mobility center of expertise is EUR 20 million. The state-of-the-art facility provides space for more than 150 employees and is located right next to the KISKA design studio in Anif near Salzburg, Austria.

In 2021, we also made further progress in the development of batteries. KTM participates in a consortium for motorcycles with swappable batteries with Honda Motor, Piaggio Group and Yamaha Motor for motorcycles and light electric vehicles. Over the next three years, the consortium will develop a common technical standard for a battery swap system including the corresponding battery swap stations.

The research and development function of PIERER E-Bikes GmbH is organized in decentralized locations across Europe (Austria, Germany, Spain). This facilitates a specific response to the mobility needs of the respective markets, whether this is urban mobility in Munich and Barcelona or the off-road or dual sport community in rural or even alpine areas around Schweinfurt, Salzburg, and Munderfing.

MOTORCYCLES

In 2021, all three motorcycle brands made a clear statement with innovative upgrades and new models, both in the on-road and off-road segments. One of the most important projects of last year for the street model platforms was the industrialization of KTM’s spearheads in the street model portfolio – the 1290 SUPER ADVENTURE R and S models as well as the 1290 SUPER DUKE RR hyper-naked bike. Now, for the first time, the 2021 generation KTM 1290 SUPER ADVENTURE S comes with innovative adaptive cruise control as standard. It was developed thanks to intensive research side-by-side with Bosch. It automatically maintains an appropriate distance to other road users in front of the motorcycle using radar sensors and can be set at five levels via the redesigned combination switch.

Further highlights include the series production of the KTM RC generation in the Supersport segment, the series ramp-up of the HUSQVARNA Norden 901 and the ramp-up of the KTM 1290 SUPER DUKE R and KTM 1290 SUPER DUKE GT models, which incorporate extensive updates.

The starting point was the KTM 890 DUKE model derivative, based on the two-cylinder mid-class platform, which had its series launch before the start of the motorcycle season in February 2021. The 890 DUKE adds the finishing touch to KTM’s naked bike range, offering a direct successor to the extremely popular 790 DUKE, where the developers were able to make significant progress, particularly in terms of mechanics and performance as well as emissions behavior.

In 2019, HUSQVARNA Motorcycles introduced the “North” prototype of a motorcycle in the mid-range Travel segment. Exactly two years after its presentation, its series ramp-up took place in November 2021. With its foundation rooted in the building blocks of the KTM 890 ADVENTURE models, this model distinguishes itself significantly from its sisters in the group with its unique design, a reworked chassis and a range of other brand-typical detailed solutions.

With the SVARTPILEN 125, Husqvarna expanded the range of naked bikes and now offers young riders a perfect model for entering the world of Husqvarna road bikes.

GASGAS Motorcycles confirmed the global availability of the latest TXT RACING and TXT GP Trial models of MY 2022. In addition, GASGAS Motorcycles has expanded its range of dirt bikes by adding the small-wheel MC 85, the MC 250 with a two-stroke engine, and the MC 350F with a four-stroke engine.

Another high point of the previous research year was the development and start of the transition to series production of the new KTM SX/SX-F and HUSQVARNA TC/FC Motocross model range in the full-size offroad segment. And because KTM’s brand motto is “Ready to Race,” not only were the prototypes of these bikes successfully subjected to comprehensive prototype tests but, due to our commitment to global motorsports, they were also tested and validated in the toughest conditions. The most recent generation of models from the full-size off-road platform is the result of a complex platform strategy, the primary objective of which is to optimize the performance of all installed components and at the same time ensure a high degree of efficiency.

The research department is also working intensively on promising, sustainable mobility solutions. Part of the strategy pursued is an open approach to different battery solutions that take advantage of both integrated and removable batteries. The 2021 research year included a series of R&D projects in the field of purely electric powered vehicle concepts. In addition to the great efforts in the area of fundamental research and technological research, new vehicle concepts – the HUSQVARNA E-PILEN concept and the electric scooter concept the HUSQVARNA BLTZ – were presented to the public for the first time last year.

In addition, KTM AG formed a consortium for motorcycles with exchangeable batteries with Honda Motor, the Piaggio Group and Yamaha Motor. The aim of the consortium is to develop solutions to address customers’ concerns regarding the future of electric mobility, such as range, charging time and infrastructure as well as costs. This is to be achieved while adhering to four main objectives:

(a) Development of common technical specifications for interchangeable battery systems;
(b) Confirmation of the joint use of battery systems;
(c) Promotion of the common specifications of the consortium in European and international standardization committees as well as their adoption as a standard;
(d) Worldwide application of the common specifications of the consortium.

Work is being carried out together with the consortium partners to develop an exchangeable battery system for low-voltage vehicles (48 V) with up to 11 kW of power, which is based on international technical standards.In parallel to the initiatives mentioned above in the area of electric mobility, the KTM group is also working on technologies for further reducing the emissions profiles of motorcycles equipped with combustion engines. The development strategy in the area of combustion engines development is clearly orientated towards a reduction in consumption and emissions. This includes R&D activities which address the further development of the thermodynamic system (electronic fuel injection, combustion) as well as exhaust aftertreatment systems (catalytic converters). Furthermore, approaches to using CO₂-free or CO₂-neutral fuels which can be obtained from, among other things, the CO₂ in the atmosphere are being studied. All engines in the displacement category over 500 cm³ are already qualified for operation with synthetic fuels (e-fuels) – other engine platforms can be changed within short response times. The MotoGP™ and Moto3™ racing series, that are particularly technology driven, will test the use of blended fuels (which consist of less than 40% fossil fuels) from the 2024 season onwards. It currently looks as though the premier class of the Motorcycle World Championship is planning to completely switch to synthetic fuels starting in the 2027 season.

E-BICYCLES

In the Bicycle Division, activities in 2021 focused on establishing the three Husqvarna E-Bicycles, R Raymon and GasGas brands, as well as on further technical development and enhancing the quality of the product range. The Husqvarna fleet of models can expect a number of innovations in 2022. Of particular significance is the new off-road model division with its own 108 frame designs and technical innovations, which is represented above all by the brand new Mountain Cross 6 (MC 6). The MC 6 proves that Husqvarna E-Bicycles takes kinematics, design, and technology seriously and is aimed at a new generation of riders. Together with Husqvarna Motorcycles, Husqvarna E-Bicycles also presented its fleet of urban mobility vehicles, and the group positioned itself on this basis at the IAA Mobility 2021 in Munich as a holistic, zero-emission manufacturer of motorized two-wheelers. In January 2022, HUSQVARNA E-Bicycles also presented the ‘Legacy Edition’, an upgraded edition of the Mountain Cross 5 with an updated design.

In 2021, GASGAS Bicycles presented the Enduro Cross 9.0 as the top model. It combines the well-known robust aluminum frame, shaped in enduro geometry, with a Rock Shox ZEB 160 fork and a Rock Shox SDS+ shock absorber, as well as wheels in the 29” front and 27.5” rear formats for perfect handling and excellent agility. With its SRAM SX Eagle 12-speed drive, 4-piston Tektro brakes, a Yamaha PW-X2 motor with an advanced Quad Sensor System, 250 W power, and an integrated 630 Wh battery in the down tube, it embodies everything the GASGAS Bicycles brand represents.

In 2021, R RAYMON introduced its claim “Ride here. Ride now.” that expresses the brand’s attributes of growth and spirit. A typical example of this is the all-round TourRay E 5.0 with a sporty Yamaha PWST drive with 60 Nm of torque and the semi-integrated Yamaha battery with 500 Wh. The trekking power of the TourRay made it the absolute best seller in the e-bike range of 2021. With its 27.5” inch wheels, disc brakes, and an SR Suntour suspension fork with 75 millimeters of suspension travel, the TourRay E 5.0 offers plenty of comfort and traction on all types of terrain. In 2022, R RAYMON will once again expand its portfolio and enter the market of light e-mountain bikes. With the AirRay, R RAYMON will change perceptions – it combines the typical fun of a trail bike with solid performance and an ideal battery capacity. The highest torque motors and highest battery capacities were deliberately not selected for these three models. Instead, the focus was on achieving a balance between the three pillars of motor, battery, and weight. Equipped with the AIR DRIVE motor powered by Yamaha (50 Nm torque), a slim 2.8 kg carbon fiber frame, agile handling and riding dynamics at the highest level, the lightweight e-mountain bike R RAYMON AirRay 29” weighs less than 20 kilograms with a suspension travel of a full 150 mm. Further innovations can be expected in the coming year, which will include new frame platforms and concepts, while at the same time R RAYMON intends to establish itself more firmly in the sports segment.

6. OPPORTUNITIES AND RISK REPORT

As Europe’s leading “Powered Two-Wheeler” (PTW) manufacturer, the PIERER Mobility Group with its KTM, HUSQVARNA Motorcycles, and GASGAS motorcycle brands is among the European technology and market leaders. The business activities of the PIERER Mobility Group are characterized by ongoing changes. Exploiting the opportunities that these changes present is the essential cornerstone of the success of the PIERER Mobility Group. In order to secure the future success of the business and exploit the opportunities that arise, the group must consciously take risks. The management of opportunities and risks is the basis for responding appropriately to changes in the underlying political, economic, technical or legal conditions. Where it is likely that the opportunities or risks identified will occur, they have already been incorporated into the statements made in the notes to the consolidated financial statements and the group management report. The following statements include possible future developments or events that could lead to a positive (opportunities) or negative (risks) deviation from the company forecast for the PIERER Mobility Group. As part of risk management, all individual and cumulative risks that could jeopardize the success of the company are monitored and controlled. Risks that could jeopardize the company as a going concern are generally avoided. The scope of risk consolidation corresponds to the scope of consolidation of the consolidated financial statements of the PIERER Mobility Group.

RISK MANAGEMENT SYSTEM

The main purpose of the PIERER Mobility Group’s risk management system is to safeguard and strengthen the company by correctly and transparently assessing financial, operational and strategic risks. In this context, the Executive Board, together with the management of the main group companies, in particular KTM AG, performs extensive management and controlling tasks within the framework of an internal, integrated control system that covers all major sites. Recognizing, evaluating and responding to strategic and operational risks promptly is an essential part of the management activities of these units and adds significant value to the company. The basis for this is a uniform, group-wide reporting system established on a monthly basis, and ongoing monitoring of operational and strategic plans. The PIERER Mobility Group has a multi-level risk management system in which group-wide risks are identified by location or geographical area. Operational responsibility and the assessment of group-wide risks is carried out by the risk management of KTM AG and local management and is reported directly to and monitored by the Executive Board and the Group Executive Board.

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Preventive analysis of potential or near-miss events is another aim of risk management. In addition, risk management is also responsible for actively controlling risks and evaluating appropriate measures with the business units concerned.

RISK MANAGEMENT STRATEGY

The PIERER Mobility Group bases its risk management strategy on risk analysis and risk assessment according to the COSO® framework. Accordingly, the group has defined the following core areas of the risk management strategy:

Risk Identification

Structured recording of opportunities and individual risks in the sectors
Implementation of risk workshops
Identification takes place, among other things, by means of the standard risk catalog

Risk Assessment

Failure mode and effect analysis
Extent of damage and probability of occurrence

Risiko Control

Control of the overall risk position by influencing opportunities and individual risk
Control of the effectiveness of measures

Reporting + Monitoring

Continuous monitoring
Collection, evaluation, forwarding of information
Reporting

Risk management established at the level of KTM AG regularly conducts risk analyses for selected production and distribution sites. Only risks outside the consolidated statement of financial position and the consolidated income statement are presented.

RISK MITIGATION

Depending on the impact on the company, efforts are made to minimize or avoid risks by taking appropriate measures or, in certain cases, to deliberately take them.

RISK ASSESSMENT

The aim of risk assessment is to perform continuous, qualitative and quantitative evaluation of all identified opportunities and risks in order to prioritize risk control measures. Opportunity and risk assessment at the PIERER Mobility Group should meet the following requirements:

Objectivity: The assessment should be performed according to standards that are as objective as possible.
Comparability: To allow the opportunities and risks to be compared with each other, a quantitative assessment is made using uniformly defined values (where reasonable and possible)

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ASSESSMENT METHODOLOGY

Opportunities and individual risks are assessed on the basis of their likelihood of occurrence and their significance for the net assets, financial position and earnings position of the group. This assessment is based on information about a) risks that have actually occurred in the past, b) benchmark values from the industry or c) realistic expert estimates prepared by the group itself. The quantitative assessment follows a scenario-based approach, distinguishing between the following categories: Best Case (BC), Most Likely Case (MLC), and Worst Case (WC). This is a classic triangular distribution.# OPPORTUNITIES AND RISK REPORT

For isolated risks, a qualitative assessment can additionally be used, if necessary, or alternative distributions (normal distribution, etc.) can be used for fluctuating risks. The choice of the respective distribution depends on the type of risk.

RISK MONITORING / CONTROL

The essence of operational risk management is to identify, evaluate and control significant risks arising from operations. This process is carried out in particular by the senior and middle management levels of KTM AG and monitored by the Executive Board of PIERER Mobility AG.

OPPORTUNITIES AND RISK REPORT

The following overview provides a general summary of all identified risks and opportunities and highlights their significance for the PIERER Mobility Group. Overall, the PIERER Mobility Group has not identified any risks that could jeopardize its continued existence as a going concern, neither on the reporting date nor at the time that the financial statements were prepared.

MARKET RISKS

Cyclical risk

The KTM group operates primarily in the motorcycle sector and the PIERER E-Bikes Group in the bicycle sector. Sales opportunities are determined by the general economic situation in the countries and regions in which the PIERER Mobility Group is represented with its products. As recent years have shown, the motorcycle sector in particular is cyclical and subject to large fluctuations regarding demand. This risk is counteracted by relevant market research and market forecasts, which are then taken into account in the planning process. Due to the change in mobility behavior, the global motorcycle market continues to grow, in particular in the most important sales regions year-on-year.

Competition and pricing pressure

Competition on the motorcycle market in industrialized countries is particularly intense; KTM’s strongest competitors are four Japanese and three European manufacturers and, on a slightly smaller scale, a U.S. manufacturer, some of which have greater financial resources, higher sales figures and market shares. Price pressure in the street motorcycle market is very high, and new competitors are trying to enter the market using low-price strategies. Thanks to its successful market strategy, KTM is Europe’s leading manufacturer of powered two-wheel vehicles. The full integration of GASGAS as the third motorcycle brand and the further development of the dealer network has also contributed to this. Thanks to our innovative strength, we see ourselves as the technology leader in the two-wheeler sector in Europe. The strategic partnership with Bajaj, India’s second-largest motorcycle manufacturer, consolidates our competitiveness in global markets.

Sales risk

The largest individual sales markets of the PIERER Mobility Group are the European market and the U.S. market. A slump in these markets could have a negative impact on business activities. Entering new markets involves a major cost risk as, in some of these markets, the trend of sales as well as the geopolitical conditions are difficult to assess. By collaborating with its strategic partner Bajaj Auto Ltd., Pune, India, the company is working steadily toward implementing a global product strategy in the motorcycle sector. In order to diversify the sales risk, the Bicycle Division is also pursuing the goal of expanding successfully in other markets.

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Geopolitical risks

It is also important to keep a closer eye on geopolitical risks. In particular, the war in Ukraine will have a negative impact on the global economy. The PIERER Mobility Group is not directly affected by the military conflicts in Ukraine. Indirectly, however, as is the case for industry as a whole, the risk increases for the PIERER Mobility Group in particular of further increases in energy and raw material costs as well as negative effects on the capital markets.

INDUSTRY-SPECIFIC RISKS

Restrictions relating to motorcycling

The revenue of the group depends, inter alia, on the possible offroad uses of motorcycles and is therefore considerably influenced by the national legal framework regulating offroad motorsport, motorcycle registration and driver’s licenses in the countries where the vehicles are sold. Due to the introduction of the Euro 5 emissions standard on January 1st 2020, updating the entire Street motorcycle product range to meet the new regulatory requirements was the focus of R&D activities and was completed in 2020. During the 2020 calendar year, all models intended for the EU region and for operation on public roads were newly type-approved according to the “Euro 5” regulations or their type approval was upgraded from “Euro 4” to “Euro 5” by an amendment. Series production of the first “Euro 5” model took place in July 2020 (sample series of KTM 890 Adventure models). The last “Euro 4” model for the EU region was produced in December 2020. From January 1st 2021, only “Euro 5” vehicles have been produced for the EU region and for operation on public roads.

Procurement risk

In the current situation, the procurement risk faced by the KTM group is principally failing to receive ordered components or receiving them on dates other than those originally agreed. In order to ensure the best possible availability of components, KTM focuses on long-term cooperations with our supply partners as well as the careful selection of excellent new suppliers in accordance with established criteria. The KTM group works continuously on developing its relationships with its suppliers. From the perspective of KTM, a deep mutual understanding of the processes is essential here. As the quality of KTM’s products is strongly determined by the quality and properties of the sourced subcomponents, particular attention is paid to suitable operating facilities and production processes of suppliers, as well as their financial strength and compliance with ecological, social and ethical standards.

In the second year following the outbreak of the COVID-19 pandemic, the KTM group faced increasing difficulties with regard to the supply of semiconductors and the associated shortages of electronic components. In order to support its suppliers in this situation, KTM AG actively intervened in the procurement of electronic components and was thus able to prevent major shortages both at suppliers and at our own production sites. In addition to the shortage of electrical components, there were also bottlenecks in the supply of raw materials such as aluminum and plastic granulate, but these only had immaterial effects on KTM AG due to intensive cooperation in the supply chain. For 2022, KTM AG expects the situation to worsen – at least in the first two quarters. The difficult supply situation for suppliers, capacity bottlenecks at suppliers themselves and interruptions to logistical processes will continue to require close coordination. To reduce risk, among other things, stock at suppliers was built up in 2022, a market intelligence system for electronic components was introduced, and the logic of our scheduling agreement releases adapted to the changed situation.

In the PIERER E-Bikes Group, the procurement of components and bikes is planned for the medium term. Short-term fluctuations can also be offset by appropriate storage capacities. The products are priced on the basis of fixed negotiated purchase prices. Prices and capacities are agreed with suppliers in advance and secured. The PIERER E-Bikes Group has several suppliers from different countries for e-bikes in its portfolio to reduce the risk of dependency, as far as possible, and increase the stability of the supply chains. The timely availability of frames and drive components as a risk places increased demands on the suppliers of e-bikes.

112 Research and development, racing

Technical innovations and the introduction of new products are largely responsible for the PIERER Mobility Group’s position in the market. To this end, new trends must be identified promptly. To counteract the risk, our own products’ innovative capacity must be ensured. Racing achievements are not only an important marketing instrument for the company but also form the basis for product development and set standards for series development. Valuable experience is gathered whenever products can be tested in racing conditions at racing events. Before being introduced into series production, all technical innovations are moreover subjected to comprehensive testing by the quality management system so as to eliminate, to the greatest extent possible, any technical defects that could have a negative effect on earnings development. In order to further expand our role as a technological pioneer and also to keep pace with major competitors, the PIERER Mobility Group pursues a very intensive research and development strategy. This also explains the relatively high research-spending ratio – currently around 8-9% of revenue.

IT RISKS

The PIERER Mobility Group has implemented an IT security and risk management system for the purpose of identifying and managing company-relevant risks in the area of information security. For further information on IT risks, please refer to the notes to the consolidated financial statements (Chapter VII) of PIERER Mobility AG.

FINANCIAL RISKS

For further information on the risk report and on financial instruments, including the specific measures to mitigate risks through the use of financial instruments (e.g. hedging of foreign currency positions with futures, swaps, etc.), please refer to the notes to the consolidated financial statements (Chapters VII and VIII) of PIERER Mobility AG.# OTHER RISKS

Risks due to the legal framework

As the PIERER Mobility Group distributes motorcycles and e-bicycles or non-e-bicycles to a large number of countries through its stakes in the KTM group and PIERER E-Bikes Group, it is exposed to the risk of changes in national regulations, terms of licenses, taxes, trade restrictions, prices, income and foreign exchange restrictions, as well as the risk of political, social and economic instability, and inflation and interest rate fluctuations. Motorcycles registered for road use must comply with corresponding provisions concerning noise and exhaust gas emissions in order to be approved for marketing in the respective country. The possible offroad uses of motorcycles are also considerably influenced by the national legal framework in the countries where the vehicles are sold. In order to counteract the risk and to be able to act promptly in the event of changes in national legal frameworks, the respective country-specific regulations are thoroughly reviewed and monitored on an ongoing basis prior to market entry.

Business and environmental risk

Environmental risks may relate to products, production, procurement and non-operating factors. With regard to the products, risks arise in relation to emissions such as noise and pollutants or the leakage of harmful substances such as fuel or oil. In order to minimize these risks that may be caused by potential malfunctions, the homologation requirements are strictly observed in addition to other measures, each vehicle tested for its functionality and compliance with all limit values on our own test benches, and a laboratory is in operation to test the interaction of materials used with people and the environment. In addition, the development of emission-free alternative drive systems and products is becoming an increasingly important focus.

In production, environmental risks arise due to the potential leakage of substances, waste and material residues on the premises. Numerous measures are implemented to prevent them. These include waste management concepts, an engine oil treatment plant, emergency plans for each site and professional extraction systems for metal chips that deposit them in the container provided for this purpose. Emissions from operating the test benches are also caught by extraction systems.

Environmental risks in procurement may result from the environment-related shortage and rising prices of resources, cooperation with suppliers that do not operate with sufficient environmental measures, and emissions from delivery routes. In order to minimize these risks, measures are taken that include auditing suppliers, optimizing procurement channels, prioritizing regional procurement, and the use of resource-saving, modern production technology.

In addition, environmental risks arise from weather-related and climate-related phenomena, such as floods and other natural disasters. Although it is not possible to completely rule out the risk of natural disasters, efforts are made to minimize the risk of production processes being impaired by having suitable emergency plans and insurance policies.

Personnel-related risks

Risks may arise if key staff leave the company, in particular with regard to the course for growth. Efficient personnel management as well as the ongoing implementation of personnel development programs are designed to counteract the risk of key staff leaving the company. The risk of a shortage of skilled staff is countered, among other things, by a comprehensive apprentice training program in the company’s own apprentice workshop. The aim is to recruit employees from the region and to retain them in the long term. Internal and external measures to increase employer attractiveness are an essential element in conveying the predominant spirit of the PIERER Mobility Group to potential new employees. With various cross-media employee campaigns, the company was able to largely cover its personnel requirements in the reporting year. When it came to APPRENTICESHIPS, attention was not only given to addressing the right target groups, but a dedicated area was also created for the parents of future apprentices in order to provide information about opportunities and possibilities at an early stage and to prevent any uncertainties.

The PIERER Mobility Group has taken numerous measures to protect its employees since the outbreak of the coronavirus pandemic in Austria. Government measures and regulations were implemented comprehensively and quickly and, due to the forward-looking approach and constant engagement with the authorities, some of them were integrated into the day-to-day business even before they were legally required. It was therefore possible to prevent large-scale spread within the company.

7. DISCLOSURES PURSUANT TO SECTION 243A (1) OF THE AUSTRIAN COMMERCIAL CODE (UGB)

The share capital amounts to EUR 33,796,535. It is divided into 33,796,535 no-par-value bearer shares with voting rights, with each ordinary share participating in the share capital to the same extent. The shares grant the customary rights due to stockholders under the Austrian Stock Corporation Act [Aktiengesetz]. These include the right to payout of the dividends resolved upon at the Annual General Meeting as well as the right to vote at the Annual General Meeting. The shares of PIERER Mobility AG have been listed on the SIX Swiss Exchange (SIX) in the International Reporting Standard since November 14th 2016 (ISIN AT0000KTMIG02). In addition, the shares of PIERER Mobility AG have been listed on the regulated market (General Standard) of the Frankfurt Stock Exchange since March 3rd 2020. Since March 1st 2022, the shares of PIERER Mobility AG have additionally been listed on the Vienna Stock Exchange (Official Market).

In the 2021 financial year, the Executive Board of the company, in the context of utilizing the authorized capital, resolved with the consent of the Supervisory Board to increase the share capital in exchange for a contribution in kind of EUR 22,538,674 by EUR 11,257,861 to EUR 33,796,535 by issuing 11,257,861 new shares. In this context, the majority shareholder Pierer Bajaj AG contributed its block of shares amounting to approximately 46.5 percent of the share capital of KTM AG to PIERER Mobility AG. The corresponding amendment to the articles of association was entered in the commercial register on October 22nd 2021.

No treasury shares were acquired in the 2021 financial year. On January 20th 2021, the share buyback program of PIERER Mobility AG was terminated prematurely. On January 21st 2021, the company decided to offer the treasury shares for sale to selected institutional investors and/or strategic business partners from February 8th 2021. This meant that all 193,340 existing treasury shares were sold in the 2021 financial year.

The change in non-restricted capital reserves from EUR 194,593,484.41 by EUR 891,996,720.59 to EUR 1,086,590,205.00 resulted on the one hand from the sale of 193,340 treasury shares and on the other hand from a capital increase through a contribution in kind of 5,042,925 KTM AG shares by Pierer Bajaj AG (formerly: PTW Holding AG).

On September 29th 2021, a syndicate agreement was concluded between Pierer Konzerngesellschaft mbH, Pierer Industrie AG and Pierer Bajaj AG on the one hand (the “Pierer Group”) and Bajaj Auto Ltd. and Bajaj Auto International Holdings B.V. on the other hand (the “Bajaj Group”) (the “2021 Syndicate Agreement”), which governs the rights and obligations of the two groups of companies with respect to the shareholding of Pierer Industrie AG and Bajaj Auto International Holdings B.V. in Pierer Bajaj AG as majority shareholder of PIERER Mobility AG. The 2021 Syndicate Agreement provides that the rules of procedure for the Executive Board and the Supervisory Board of Pierer Bajaj AG require the approval of the Supervisory Board members of Pierer Bajaj AG nominated by Bajaj in the event of a transfer of ownership of shares in PIERER Mobility AG. Pierer Bajaj AG, which is economically attributable to Stefan Pierer, is thus subject to restrictions on disposal in light of the syndicate agreement at the level of Pierer Bajaj AG. The Executive Board is not aware of any other restrictions affecting voting rights or the transfer of shares.
To the company’s knowledge, as of December 31st 2021, the following direct or indirect equity holding in the capital of PIERER Mobility AG amounting to at least 10 percent existed:
- Pierer Bajaj AG (formerly: PTW Holding AG): 73.32% (direct equity holding)
- Pierer Industrie AG: 73.32% (indirect equity holding)
- Pierer Konzerngesellschaft mbH (direct and indirect equity holding): 2.58% (direct equity holding) and 73.32% (indirect equity holding).
There are no shares with special control rights.
There are currently no employee participation models.
There are no provisions going beyond the law with regard to the appointment and dismissal of members of the Executive Board and Supervisory Board and amendments to the articles of association.
Options to issue or buy back shares: The following resolutions were adopted at the Annual General Meeting on April 27th 2017:
a) To authorize the Executive Board, with the approval of the Supervisory Board, to issue financial instruments within the meaning of Section 174 of the Austrian Stock Corporation Act (AktG), in particular convertible bonds, income bonds and profit participation rights, with a total nominal value of EUR 150,000,000.00 until April 1st 2022, which may also grant subscription and/or conversion rights to acquire a total of up to 25,000,000 shares in the company and/or are structured in such a way that they can be reported as equity, also in several tranches and in different combinations.
b) The Executive Board may use the conditional capital and/or treasury shares to service the conversion and/or subscription rights.c) The issue price and terms of issue of the financial instruments shall be determined by the Executive Board with the approval of the Supervisory Board, whereby the issue price shall be determined in accordance with recognized methods of financial mathematics and the price of the shares of the company in a recognized pricing procedure.
d) The Executive Board is authorized, with the approval of the Supervisory Board, to exclude shareholders’ subscription rights to financial instruments within the meaning of Section 174 of the Austrian Stock Corporation Act (AktG).
e) The conditional increase of the share capital of the company pursuant to Section 159 para. 2 no. 1 of the Austrian Stock Corporation Act (AktG) by up to EUR 25,000,000.00 by issuing up to 25,000,000 no-par-value ordinary bearer shares for issuance to creditors of financial instruments pursuant to Section 174 of the Austrian Stock Corporation Act (AktG), which are issued by the company using the authorization granted in this Annual General Meeting, to the extent that the creditors of the financial instruments exercise their conversion and/or subscription rights to shares in the company. The issue amount and the exchange ratio are to be determined in accordance with recognized methods of financial mathematics and the share price in a recognized pricing procedure. The newly issued shares of the conditional capital increase are entitled to dividends to the same extent as the existing shares in the company. The Executive Board is authorized, with the approval of the Supervisory Board, to determine the further details of the implementation of the conditional capital increase. The Supervisory Board is authorized to resolve amendments to the articles of association resulting from the issue of shares from the conditional capital.
f) Pursuant to Section 65 para. 1 no. 8 and para. 1a and 1b of the Austrian Stock Corporation Act (AktG), the Executive Board is authorized to acquire no-par-value bearer shares of the company representing up to 10% of the share capital of the company for a period of 30 months from the date of the resolution, both on and off the stock exchange, whereby the lowest price may not be more than 20% below and the highest price may not be more than 10% above the average closing price on the last three trading days prior to the acquisition of the shares. Trading in treasury shares is excluded as a purpose of the acquisition. The authorization may be exercised in whole or in part or in several installments and in pursuit of one or more purposes by the company, by subsidiaries or by third parties for the account of the company.
g) The Executive Board may decide to acquire shares on the stock exchange, but the Supervisory Board must be informed of this decision afterward. Off-market acquisitions are subject to the prior approval of the Supervisory Board.
h) The Executive Board is authorized for a period of five years from the date of the resolution pursuant to Section 65 para. 1b of the Austrian Stock Corporation Act (AktG), with the approval of the Supervisory Board, to decide on a method of disposal or use of treasury shares other than via the stock exchange or by means of a public offer, applying mutatis mutandis the provisions on the exclusion of shareholders’ subscription rights, and to determine the terms and conditions of disposal. The authorization may be exercised in whole or in part or in several installments and in pursuit of one or more purposes by the company, by a subsidiary or by third parties for the account of the company, in particular in return for the acquisition of companies, businesses, parts of businesses or shares in one or more companies in Austria or abroad.
i) The Executive Board is also authorized, with the approval of the Supervisory Board, to reduce the share capital, if necessary, by redeeming these treasury shares without a further resolution adopted at the General Meeting pursuant to Section 65 para. 1 no. 8, last sentence in conjunction with Section 122 of the Austrian Stock Corporation Act (AktG). The Supervisory Board is authorized to adopt amendments to the articles of association resulting from the redemption of shares.

The following resolutions were adopted at the Annual General Meeting on April 26th 2018:
a) Pursuant to Section 169 of the Austrian Stock Corporation Act (AktG), the Executive Board is authorized until April 26th 2023, with the approval of the Supervisory Board, to increase the share capital of the company from EUR 22,538,674.00, in several tranches if necessary, in exchange for cash contributions and/or contributions in kind, by up to EUR 11,269,337.00 by issuing up to 11,269,337 no-par-value bearer shares to up to EUR 33,808,011.00, and to determine the issue price, the terms and conditions of the issue and the further details of the implementation of the capital increase in agreement with the Supervisory Board and, if necessary, to offer the new shares to the shareholders for subscription by way of indirect subscription rights pursuant to Section 153 (6) of the Austrian Stock Corporation Act (AktG).
b) The Executive Board is authorized, with the approval of the Supervisory Board, to exclude the shareholders’ subscription rights in whole or in part:
(i) if the capital increase was made in return for cash contributions and the total arithmetical proportion of the company’s share capital represented by the shares issued in return for cash contributions with exclusion of subscription rights does not exceed the limit of 10% (ten percent) of the company’s share capital at the time of granting,
(ii) if the capital increase is made against a contribution in kind,
(iii) to service an over-allotment option (Greenshoe), and/or
(iv) for the settlement of fractional amounts.
This authorization was utilized by the Executive Board of PIERER Mobility AG to carry out the capital increase in return for contributions in kind in October 2021 in the amount of EUR 11,257,861.00 by issuing 11,257,861 no-par-value bearer shares.

The following resolutions were adopted at the Extraordinary Annual General Meeting on October 4th 2019:
a) Pursuant to Section 65 para. 1 no. 8 of the Austrian Stock Corporation Act (AktG), the Executive Board is authorized for a period of 30 months to acquire treasury shares of the company both on and off the stock exchange, also excluding the shareholders’ right to offer shares on a quota basis, and, without having to refer the matter to the Annual General Meeting again in advance, to retire these shares if necessary with the approval of the Supervisory Board. Trading in treasury shares is excluded as a purpose of the acquisition. The proportion of shares to be acquired may not exceed 10% of the share capital. The value received per no-par-value share to be acquired may not be more than 20% below or above the average unweighted closing price on the SIX Swiss Exchange over the past 10 trading days. The authorization may be exercised in whole or in part or in several installments and in pursuit of one or more purposes by the company, by affiliated companies or by third parties for the account of the company. The Supervisory Board is authorized to adopt amendments to the articles of association resulting from the redemption of shares.
b) The Executive Board is authorized for a period of five years, with the approval of the Supervisory Board, to sell or use treasury shares in a way other than via the stock exchange or by means of a public offer for any legally permissible purpose and in so doing also to exclude the shareholders’ quota-based purchase right (exclusion of subscription rights) and to determine the terms and conditions of disposal. The authorization may be exercised in whole or in part or in several installments and in pursuit of one or more purposes.

Agreements of the company which take effect, change or end in the event of a change of control as a result of a takeover bid, as well as their effects, will not be disclosed by the company as this would significantly harm the company.
There are no compensation agreements between the company and its Executive Board and Supervisory Board members or employees in the event of a public takeover bid.
MAIN FEATURES OF THE INTERNAL CONTROL SYSTEM SECTION 243A (2) OF THE AUSTRIAN COMMERCIAL CODE (UGB)
The internal control system of the PIERER Mobility Group has the task of ensuring the correctness and reliability of financial reporting, compliance with the legal and internal regulations applicable to the company, as well as the effectiveness and efficiency of operating activity, including the protection of assets from losses caused by damages and malversations. Internationally recognized frameworks for internal control systems (e.g. COSO framework) were taken into account in designing the elements of the internal control system. The system includes:
Group-wide specifications for financial reporting
Segregation of duties as an organizational measure
System-based and process-dependent controls
Process-independent controls

The PIERER Mobility Group is committed to the continuous development and improvement of the internal control system. To this end, its functionality is regularly monitored through process and data analyses as well as independent, external audit activities. The main features of the internal control system with regard to the financial reporting process are presented below.

CONTROL ENVIRONMENT
The organizational structure of the PIERER Mobility Group forms the basis for the control environment and the internal control system within the company. In terms of the organizational structure in (group) financial reporting, there are clear areas of competence and responsibility at the various management and hierarchical levels of the group. On the one hand, this relates to the group headquarters in Wels as well as the Austrian and all international subsidiaries.# Treasury and Business Process Finance

Treasury and Business Process Finance are located in the operating areas of the group, with duties and responsibilities also being clearly divided here. The strong international orientation of the PIERER Mobility Group and the associated decentralized structures of the company and different sites are taken into account by centralizing key corporate functions in the area of financial reporting at the Austrian sites (especially in Mattighofen). The performance and management of national business activities is the responsibility of the respective local management and is monitored by the Executive Board of KTM AG and the Group Executive Board.

In terms of process organization, the PIERER Mobility Group relies on a distinctive and comprehensive set of accounting, valuation and account assignment rules. This provides an appropriate basis for a strong control environment and control system. New accounting standards are assessed with regard to their impact on the financial reporting of the PIERER Mobility Group. The specifications for financial reporting and financial reporting processes are reviewed on an ongoing basis and adjusted at least annually, or more frequently if necessary. Monitoring compliance with the controls and regulations relating to financial reporting is the responsibility of the relevant management.

RISK ASSESSMENT

Risks relating to the financial reporting process are identified and monitored by management. The focus is placed on those risks that are typically to be regarded as material. Material risks in the area of financial reporting include incomplete recording of facts relevant to accounting, errors in document recording, and incorrect calculations. Complex accounting principles could lead to an increased risk of error, incorrect reporting, and late preparation of financial statements. There is also a risk of data being accessed by unauthorized persons or of data being manipulated, IT systems failing, and data being lost.

For the preparation of the financial statements, estimates have to be made on a regular basis and there is an inherent risk that future developments may deviate from these estimates. This applies in particular to the following matters/items in the consolidated financial statements: Social capital, outcome of legal disputes, recoverability of receivables, investments and stocks. In some cases, external experts are consulted or publicly available sources are used to minimize the risk of incorrect estimates.

CONTROL MEASURES

The PIERER Mobility Group has integrated its controls directly into the (group) financial reporting processes. An essential element of this, in addition to process-independent external control mechanisms, is the principle of segregation of duties. To ensure complete, timely and correct preparation of the financial statements, quality assurance and control measures have been implemented in all areas involved in the accounting process. All control measures are applied in the ongoing business process to ensure that potential errors in financial reporting are prevented or are detected and corrected.

Furthermore, the application of internal company guidelines results in consistent handling of business transactions as well as consistent accounting and reporting. Controls are integrated in the key IT systems with a relevance for financial reporting which prevent, among other things, the incorrect recording of business transactions, ensure the complete recording of business transactions or the measurement of business transactions in accordance with the financial reporting requirements, or support the verification of consolidation. In view of the increasing demands on IT systems in financial reporting as well as the constantly growing technical possibilities, the PIERER Mobility Group regularly conducts IT-supported analyses of the effectiveness of the measures taken in order to identify and subsequently eliminate any control weaknesses that may have occurred.

Control measures relating to IT security are a cornerstone of the internal control system. For example, the separation of sensitive activities is supported by restricting the allocation of IT authorizations. Automated checks take place through the ERP software used, such as the automated checks for invoice approval and invoice verification.

COMMUNICATION AND MONITORING

Responsibility for the effectiveness of the internal control system in the (group) financial reporting process is clearly defined and lies with the responsible managers and process owners. In addition to the results of the internal assessment, the assessment of effectiveness also includes the results of external audits, e.g., as part of the audit of the annual financial statements or external IT security audits, as well as those of the Supervisory Board and the Audit Committee. Weaknesses in the control system are remedied taking into account their potential impact on the financial reporting processes.

In addition to the financial statements required by law, which are made available to management levels, the group has also implemented a comprehensive internal reporting system that is prepared and distributed at different levels of aggregation depending on the recipient of the report. Other central instruments of risk monitoring and control are the company-wide guidelines on dealing with significant risks, the planning and controlling processes, and ongoing reporting. The guidelines include the setting and control of limits and actions to limit financial risks, as well as the strict specification of the dual control principle for invoice and payment approvals.

In addition, the internal control system is based on precise information about the accounting and financial reporting processes and also includes their upstream business processes, e.g. purchase requisitions or logistics processes. The effectiveness of the internal control system is reviewed by management in that the results, which are submitted to management in condensed reporting form, are analyzed, evaluated and commented on by management. The Executive Board and the Audit Committee are informed annually about the assessment of the effectiveness of the internal control system in financial reporting. In the event of significant changes in the effectiveness of the internal control system, a report is immediately submitted to the Executive Board and, if necessary, to the Supervisory Board, and suitable measures are taken to increase its effectiveness.

9. OUTLOOK

For the 2022 financial year, the Executive Board anticipates renewed growth both for motorcycles and bicycles with earnings within the long-term range. However, challenges in the international supply chains must continue to be expected in 2022, as capacity and supply bottlenecks at individual suppliers and in international transport logistics may lead to delays with deliveries. Wide-ranging measures in the area of supply chain management and a high degree of flexibility in production planning are aimed at identifying and minimizing negative effects in good time. The expected challenges and their consequences are to be mitigated by the supplier risk assessment, which was revised last year, as well as the program implemented to provide advance warning of global events that directly or indirectly affect the supply chain.

On the sales side, PIERER Mobility continues to view the market as consistently positive. Growth is expected to be driven primarily by the continued high global demand and the megatrend toward two-wheelers as well as increasing numbers of electric vehicles, especially in urban areas. In line with the strategic objective of contributing to emissions reduction and emissions neutrality for motorcycles, the focus of development work in the years to come will increasingly be on alternative drive systems in the range up to 15 kW. In the range above this, efforts will focus on the technological advancement of conventional forms of propulsion with synthetic fuels for avoiding CO2. The main goal is to fully exploit the innovation and development potential in the area of electric mobility and to help shape the growing market and secure market share with e-fuel-powered combustion engines as a global player with strong brands. At least three electric platforms with multiple products will be launched by 2024.

While the focus in 2021 in the Bicycle Division was primarily on broadening the establishment of the Husqvarna E-Bicycles and R RAYMON brands in European markets and expanding the network of dealers in the core markets of Germany, Austria and Switzerland (DACH), the acquisition of the FELT brand opens up a new range of product, sales and development opportunities. With FELT, the existing range of bicycles has been expanded, in particular by adding the racing division, and this will provide a stronger opening as well as positioning on the North American market for all bicycle products. In addition to the DACH region, the North American market offers enormous growth and sales potential for the sale of e-bicycles. In addition, further expansion stages are to focus on the overseas market of Australia as well as Southern Europe. The dynamic growth trajectory will also be further advanced by adding the GASGAS brand to the e-bicycle product range and expanding e-bicycle sales in the existing motorcycle trade.

In the 2022 financial year, the PIERER Mobility Group will continue to focus on growth in all core areas, both motorcycles and (e-)bicycles, despite the challenges that exist in the supply chain. The Executive Board anticipates revenue growth of between 6% and 10% (2021 financial year: EUR 2,041.7 million) with an EBIT margin of 8 to 10% and an EBITDA margin of between 15 and 17%. In addition, PIERER Mobility AG listed its shares in the official trading (prime market segment) of the Vienna Stock Exchange.The admission to trading on the prime market, the top segment of the Vienna Stock Exchange, took place on March 1st 2022. In addition, it is also important to keep a closer eye on geopolitical risks. In particular, the military conflicts in Ukraine will have a negative impact on the global economy. The exchange rate environment is expected to remain volatile in the regions important to PIERER Mobility. Wels, March 11th 2022 The Executive Board of PIERER Mobility AG Stefan Pierer Friedrich Roithner Hubert Trunkenpolz Viktor Sigl, MBA R Raymon TrailRay E 10.0 / FullRay E-Seven 8.0, MY21 © R Raymon/Janik Steiner 119119 ANNUAL REPORT 2021 CONSOLIDATED FINANCIAL STATEMENTS Consolidated statement of financial position ... 120 Consolidated income statement ... 122 Consolidated statement of comprehensive income ... 123 Consolidated statement of cash flows ... 124 Consolidated statement of changes in equity ... 126 Consolidated financial statements Download 120

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2021

EURk	Notes	12/31/2021	12/31/2020
Assets:
Non-current assets:
Goodwill	21	130,711	131,034
Intangible assets	22	473,561	426,835
Property, plant, and equipment	23	361,330	356,219
Investments accounted for using the equity method	24	13,562	13,252
Deferred tax assets	25	9,617	11,518
Other non-current assets	26	4,033	3,137
		992,814	941,995
Current assets:
Inventories	27	405,174	298,744
Trade receivables	28	150,861	144,887
Receivables and other assets	29	110,801	81,621
Tax refund claims		560	517
Cash and cash equivalents	30	373,509	218,270
		1,040,905	744,039
		2,033,719	1,686,034

121121 ANNUAL REPORT 2021

EURk	Notes	12/31/2021	12/31/2020
Equity and liabilities:
Equity:
Share capital	31	33,797	22,539
Capital reserves	31	9,949	9,949
Other reserves including retained earnings	31	716,396	327,767
Equity of the owners of the parent company		760,142	360,255
Non-controlling interests	31	5,409	293,864
		765,551	654,119
Non-current liabilities:
Financial liabilities	32	506,539	456,089
Liabilities for employee benefits	33	28,763	28,665
Deferred tax liabilities	25	99,977	86,940
Other non-current liabilities	34	14,187	9,735
		649,466	581,429
Current liabilities:
Financial liabilities	32	56,847	74,594
Trade payables	34	395,581	262,099
Provisions	35	23,105	17,979
Tax liabilities		9,852	9,198
Other current liabilities	34	133,317	86,616
		618,702	450,486
		2,033,719	1,686,034

122

CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1/1/2021 THROUGH 12/31/2021

EURk	Notes	2021	2020
Revenue	8	2,041,730	1,530,382
Production costs of the services provided to generate the revenue	9	-1,448,631	-1,103,550
Gross profit from sales		593,099	426,832
Selling and racing expenses	10	-237,847	-192,216
Research and development expenses	11	-33,330	-23,391
Administration expenses	12	-128,857	-102,645
Other operating expenses	13	-1,990	-164
Other operating income	14	744	5
Earnings from at-equity holdings	15	1,666	-1,180
Result from operating activities		193,485	107,241
Interest income	16	1,864	1,629
Interest expenses	16	-12,858	-15,213
Other financial and investment income (expenses)	16	9,097	-2,833
Result before taxes		191,588	90,824
Income taxes	17	-48,716	-21,369
Profit or loss for the financial year		142,872	69,455
thereof owners of the parent company		82,540	34,911
thereof non-controlling shareholders		60,332	34,544
Undiluted (=diluted) earnings per share (EUR)	18	3.34	1.56

123123 ANNUAL REPORT 2021

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR FROM 1/1/2021 THROUGH 12/31/2021

EURk	Notes	2021	2020
Profit or loss for the financial year		142,872	69,455
Items reclassified to profit or loss or which can be subsequently reclassified
Foreign currency translation re foreign subsidiaries	31	4,492	-4,176
Foreign currency translation re investments accounted for using the equity method	24, 31	425	-100
Valuation of cash flow hedges of subsidiaries	31	3,008	-1,435
Deferred tax on valuation of cash flow hedges	31	-752	359
		7,173	-5,352
Items not reclassified to profit or loss
Revaluation of net debt from defined benefit plans	31, 33	759	908
Tax effect	31	-190	-227
		569	681
Other net result after tax		7,742	-4,671
Total comprehensive income		150,614	64,784
thereof owners of the parent company		88,054	31,829
thereof non-controlling shareholders		62,560	32,955

124

EURk	Notes	2021	2020
Operations
Profit or loss for the financial year		142,872	69,455
+ (-) Interest expenses / interest income	16	10,994	13,584
+ Tax expenses	17	48,716	21,369
+ Depreciation/amortization of property, plant and equipment and intangible assets	22, 23	138,717	126,289
+ (-) Addition (reversal) of non-current liabilities for employee benefits	554	554	-100
(-) + Profit (loss) from equity consolidation	15	-1,666	1,180
(-) + Profit (loss) from the diposal of fixed assets	22, 23	12,286	2,471
+ (-) Other non-cash expenses (income)	VI	-13,284	5,060
+ Interest received		1,855	1,621
- Interest payments		-11,954	-14,807
- Tax payments		-31,048	-4,087
+ Dividends received		1,022	606
Gross cash flow		299,064	222,641
- (+) Increase (decrease) in inventories		-104,641	17,128
- (+) Increase (decrease) in trade receivables, advance payments, other current and non-current assets		298	25,618
+ (-) Increase (decrease) in trade payables, advance payments and other current and non-current liabilities		172,642	47,432
Increase (decrease) in the net current assets		68,299	90,178
Cash flow from operations		367,363	312,819

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR 1/1/2021 THROUGH 12/31/2021

125125 ANNUAL REPORT 2021

EURk	Notes	2021	2020
Investing activity
- Payments for the acquisition of intangible assets and property, plant and equipment	22, 23	-181,922	-147,856
- Payments for the acquisition of investments accounted for using the equity method and other financial assets	7, 24	-773	-150
+ Receipts from the sale of intangible assets and property, plant and equipment		599	631
+ Receipts from the disposal of investments accounted for using the equity method and other financial assets	24	0	0
+ (-) Changes to the scope of consolidation	7	934	290
+ (-) Payments/receipts from other assets		-13,961	76
Cash flow from investing activity		-195,123	-147,009
Free cash flow		172,240	165,810
Financing activity
- Dividend payments to third parties		-24,448	-26,744
- Acquisition of own shares		0	-4,569
+ Sale of own shares	31	13,595	0
+ (-) Disposal/acquisition of non-controlling interests	31	-27,906	-1,005
+ Taking out a research loan	VI	50,000	0
+ Taking out non-current interest-bearing liabilities	32, VI	29,528	0
- Repayment of promissory note loan	32, VI	-3,500	-6,000
- Repayment of research loan	VI	-25,368	-13,174
- Repayment of non-current interest-bearing liabilities	VI	-11,101	-10,384
- Repayment of lease liability	VI, 47	-18,431	-18,821
+ (-) Change in other current financial liabilities	VI	-9,990	-23,992
Cash flow from financing activity		-27,621	-104,689
Total cash flow		144,619	61,121
+ Opening balance of liquid funds within the Group		218,270	160,864
+ Effect of foreign currency fluctuations		10,620	-3,715
Closing balance of liquid funds within the Group		373,509	218,270

126

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

EURk	Notes	Share capital	Capital reserves	Reserves including total earnings	Reserve in accordance with IFRS 9	Adjustment items currency translation	Reserves for own shares	Total	Shares of non- controlling shareholders	Total consolidated equity
Balance as of January 1, 2021		22,539	9,949	339,548	-1,318	-2,016	-8,447	360,255	293,864	654,119
Profit or loss for the financial year		0	0	82,540	0	0	0	82,540	60,332	142,872
Other comprehensive income	31	0	0	206	1,871	3,437	0	5,514	2,228	7,742
Total comprehensive income		0	0	82,746	1,871	3,437	0	88,054	62,560	150,614
Transactions with shareholders
Dividends to third parties	18, 31	0	0	-11,173	0	0	0	-11,173	-13,275	-24,448
Acquisition/disposal of shares to subsidiaries	31	0	0	309,876	660	-548	0	309,988	-340,458	-30,470
Changes to the scope of consolidation	7	0	0	0	0	0	0	0	2,784	2,784
Gains and losses on hedging transactions and hedging costs reclassified to inventories		0	0	0	156	0	0	156	0	156
Disposal of own shares	31	0	0	5,148	0	0	8,447	13,595	0	13,595
Capital measures		11,258	0	-11,258	0	0	0	0	0	0
Miscellaneous		0	0	-733	0	0	0	-733	-66	-799
Balance as of December 31, 2021		33,797	9,949	714,154	1,369	873	0	760,142	5,409	765,551

EURk	Notes	Share capital	Capital reserves	Reserves including total earnings	Reserve in accordance with IFRS 9	Adjustment items currency translation	Reserves for own shares	Total	Shares of non- controlling shareholders	Total consolidated equity
Balance as of January 1, 2020		22,539	9,949	305,078	-140	203	-5,220	332,409	274,800	607,209
Profit or loss for the financial year		0	0	34,911	0	0	0	34,911	34,544	69,455
Other comprehensive income	31	0	0	352	-1,215	-2,219	0	-3,082	-1,589	-4,671
Total comprehensive income		0	0	35,263	-1,215	-2,219	0	31,829	32,955	64,784
Transactions with shareholders
Dividends to third parties	31	0	0	0	0	0	0	0	-13,739	-13,739
Acquisition/disposal of shares to subsidiaries	31	0	0	-660	0	0	0	-660	-345	-1,005
Changes to the scope of consolidation		0	0	0	0	0	0	0	158	158
Gains and losses on hedging transactions and hedging costs reclassified to inventories		0	0	0	37	0	0	37	34	71
Acquisition of own shares	31	0	0	0	0	0	-4,569	-4,569	0	-4,569
Disposal of own shares	31	0	0	0	0	0	1,342	1,342	0	1,342
Miscellaneous		0	0	-133	0	0	0	-133	0	-133
Balance as of December 31, 2020		22,539	9,949	339,548	-1,318	-2,016	-8,447	360,255	293,864	654,119

127127 ANNUAL REPORT 2021

| EURk | Notes | No. |
| :--- | :---- | :-- |# NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE 2021 FINANCIAL YEAR

I. GENERAL INFORMATION

1. Company Information

The PIERER Mobility Group is Europe‘s leading “Powered Two-Wheeler” (PTW) manufacturer with a focus on highly innovative sports motorcycles and electric mobility. With its KTM, HUSQVARNA Motorcycles, and GASGAS motorcycle brands, it is one of the technology and market leaders in Europe, especially when it comes to premium motorcycles. In addition to vehicles with combustion engines, the product range also includes zero-emission two-wheelers with electric powertrains (e-motorcycles, e-bicycles). As a pioneer in electric mobility for two-wheelers, the group, with its strategic partner Bajaj, has created the basis for assuming a leading global role in the low-voltage range (48 volts). Establishing the (e-)bicycle division with PIERER E-Bikes GmbH was another important move in also stepping up its activities in the area of electric bicycle mobility. The bicycles will be marketed under the HUSQVARNA E-Bicycles, R Raymon, GASGAS E-Bicycles and FELT Bicycles brands in order to gain a share of the attractive market growth in this segment and to develop into a significant international player in this field. PIERER Mobility AG has its headquarters at Edisonstraße 1, 4600 Wels, and is registered in the commercial register at the Provincial Court of Wels in its capacity as Commercial Court, under the registration number FN 78112 x. The company is part of the same group as Pierer Konzerngesellschaft mbH, Wels (ultimate parent company of the group) and its affiliated companies, and is included within the consolidated financial statements of that group. These consolidated financial statements are filed with the Provincial Court of Wels in its capacity as Commercial Court under file number FN 134766 k and are the consolidated financial statements for the largest scope of consolidation. The shares of PIERER Mobility AG are listed in the “Swiss Performance Index (SPI)” of the SIX Swiss Exchange in Zurich and since March 3rd 2020 have also been listed in the regulated market of the Frankfurt Stock Exchange.

2. Principles of Financial Reporting

The consolidated financial statements for the PIERER Mobility Group have been prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union (EU). These include all standards and interpretations that are mandatory for application. The financial statements are presented in thousands of euros (EURk), unless otherwise indicated.

3. Newly Applied Standards and Interpretations

This section details new accounting standards and interpretations that have become effective during the reporting year and have been applied by the Group.

4. Standards and Interpretations to be Applied in the Future

This section outlines standards and interpretations issued by the IASB that are not yet mandatory for application by the Group but are expected to impact the financial statements in future periods.

5. Estimates and Discretionary Decisions

The preparation of financial statements requires management to make estimates and discretionary decisions that affect the reported amounts of assets and liabilities, income and expenses. These estimates and judgments are based on historical experience, current conditions and other factors that are believed to be reasonable under the circumstances.

II. SCOPE OF CONSOLIDATION

6. Consolidation Principles and Methods

The consolidated financial statements include all companies in which the PIERER Mobility AG holds, directly or indirectly, a majority of the voting rights or has the ability to exercise control. Control is presumed if PIERER Mobility AG holds more than 50% of the voting capital. Subsidiaries are consolidated from the date on which control is transferred to the Group and are de-consolidated from the date on which control ceases to be held. Acquisitions of subsidiaries are accounted for using the acquisition method. In this method, the purchase price of an acquired company is allocated to the identifiable assets acquired and liabilities assumed at their fair values at the date of acquisition. Any excess of the purchase price over the net fair value of identifiable assets and liabilities is recognized as goodwill.

7. Changes in the Scope of Consolidation

This section details any changes to the companies included in the scope of consolidation during the reporting period, including acquisitions, disposals, and other events that affected the consolidation.

III. SEGMENT REPORTING

This section provides a breakdown of the Group's financial performance by operating segment, based on internal management reporting structures.

IV. NOTES TO THE CONSOLIDATED INCOME STATEMENT

8. Revenues

This section details the sources and amounts of revenue generated by the Group, including sales of motorcycles, spare parts, accessories, and other related services.

9. Cost of Sales

This section outlines the direct costs associated with the production and sale of goods, including raw materials, direct labor, and manufacturing overhead.

10. Selling and Racing Expenses

This section includes expenses related to marketing, sales, distribution, and sponsorship activities, including the costs associated with racing events.

11. Research and Development Expenses

This section details the costs incurred in connection with the research and development of new products and technologies.

12. Administrative Expenses

This section covers general administrative costs, including salaries of administrative staff, office expenses, and other overhead costs not directly related to production or sales.

13. Other Operating Expenses

This section includes various operating expenses not classified elsewhere, such as depreciation of non-current assets, impairment losses, and other miscellaneous expenses.

14. Other Operating Income

This section details income generated from sources other than the Group's primary operating activities, such as gains on the sale of assets.

15. Earnings from at-equity Holdings

This section presents the Group's share of profit or loss from investments in associated companies and joint ventures accounted for using the equity method.

16. Financial and Investment Earnings

This section includes income and expenses related to financial instruments and investments, such as interest income, dividend income, and interest expenses.

17. Income Taxes

This section provides information on current and deferred income taxes recognized in the consolidated income statement.

18. Earnings per Share and Appropriation of Net Profit

This section presents the calculation of basic and diluted earnings per share, as well as the proposed appropriation of net profit.

19. Expenses for the Auditor of the Financial Statements

This section details the fees paid to the statutory auditor for audit and other services.

20. Employees

This section provides information on the number of employees and related personnel costs.

V. NOTES TO THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

21. Goodwill

This section details the carrying amount of goodwill arising from business combinations.

22. Intangible Assets

This section presents details of intangible assets, including acquired licenses, patents, trademarks, and software.

23. Property, Plant and Equipment

This section provides a breakdown of tangible fixed assets, including land, buildings, machinery, and vehicles.

24. Investments Accounted for Using the Equity Method

This section details investments in associated companies and joint ventures that are accounted for using the equity method.

25. Deferred Tax Assets

This section presents the recognized deferred tax assets, which arise from temporary differences and tax loss carryforwards.

26. Other Non-Current Assets

This section includes other non-current assets that do not fall into any specific category.

27. Inventories

This section details the value of inventories held by the Group, including raw materials, work-in-progress, and finished goods.

28. Trade Receivables

This section presents the carrying amount of trade receivables, net of any allowances for doubtful accounts.

29. Current Receivables and Other Assets

This section includes other current assets such as prepayments, accrued income, and other receivables.

30. Cash and Cash Equivalents

This section provides information on the Group's cash and cash equivalents, including bank balances and short-term, highly liquid investments.

31. Consolidated Equity

This section presents the details of the Group's consolidated equity, including share capital, reserves, and retained earnings.

Equity of the owners of the parent company	Share capital	Capital reserves	Reserves including total earnings	Reserve in accordance with IFRS 9	Adjustment items currency translation	Reserves for own shares	Total	Shares of non- controlling shareholders	Total consolidated equity
Balance as of January 1, 2021	22,539	9,949	339,548	-1,318	-2,016	-8,447	360,255	293,864	654,119
Profit or loss for the financial year	0	0	82,540	0	0	0	82,540	60,332	142,872
Other comprehensive income	31	0	0	206	1,871	3,437	0	5,514	2,228
Total comprehensive income	0	0	82,746	1,871	3,437	0	88,054	62,560	150,614
Transactions with shareholders
Dividends to third parties	18, 31	0	0	-11,173	0	0	-11,173	-13,275	-24,448
Acquisition/disposal of shares to subsidiaries	31	0	0	309,876	660	-548	0	309,988	-340,458
Changes to the scope of consolidation	7	0	0	0	0	0	0	0	2,784
Gains and losses on hedging transactions and hedging costs reclassified to inventories	0	0	0	156	0	0	156	0	156
Disposal of own shares	31	0	0	5,148	0	8,447	13,595	0	13,595
Capital measures	11,258	0	-11,258	0	0	0	0	0	0
Miscellaneous	0	0	-733	0	0	0	-733	-66	-799
Balance as of December 31, 2021	33,797	9,949	714,154	1,369	873	0	760,142	5,409	765,551

EURk

Notes No.	Equity of the owners of the parent company	Share capital	Capital reserves	Reserves including total earnings	Reserve in accordance with IFRS 9	Adjustment items currency translation	Reserves for own shares	Total	Shares of non- controlling shareholders	Total consolidated equity
Balance as of January 1, 2020	22,539	9,949	305,078	-140	203	-5,220	332,409	274,800	607,209
Profit or loss for the financial year	0	0	34,911	0	0	0	34,911	34,544	69,455
Other comprehensive income	31	0	0	352	-1,215	-2,219	0	-3,082	-1,589	-4,671
Total comprehensive income	0	0	35,263	-1,215	-2,219	0	31,829	32,955	64,784
Transactions with shareholders
Dividends to third parties	31	0	0	0	0	0	0	0	-13,739	-13,739
Acquisition/disposal of shares to subsidiaries	31	0	0	-660	0	0	0	-660	-345	-1,005
Changes to the scope of consolidation	0	0	0	0	0	0	0	0	158	158
Gains and losses on hedging transactions and hedging costs reclassified to inventories	0	0	0	37	0	0	37	34	71
Acquisition of own shares	31	0	0	0	0	-4,569	-4,569	0	-4,569
Disposal of own shares	31	0	0	0	0	1,342	1,342	0	1,342
Miscellaneous	0	0	-133	0	0	0	-133	0	-133
Balance as of December 31, 2020	22,539	9,949	339,548	-1,318	-2,016	-8,447	360,255	293,864	654,119

32. Financial Liabilities

This section provides details of the Group's financial liabilities, including loans, bonds, and other borrowings.

33. Obligations for Employee Benefits

This section outlines the Group's obligations related to employee pension plans and other post-employment benefits.

34. Other Current and Non-Current Liabilities and Trade Payables

This section includes other liabilities, such as trade payables, accruals, and other short-term and long-term obligations.

35. Provisions

This section presents provisions recognized by the Group, which represent liabilities of uncertain timing or amount, such as provisions for warranties or legal claims.

VI. NOTES TO THE STATEMENT OF CASH FLOWS

This section explains the movements in cash and cash equivalents during the reporting period, categorized into operating, investing, and financing activities.

VII. RISK REPORT

36. Risk Management

This section describes the Group's overall approach to risk management, including its risk governance, risk assessment processes, and risk mitigation strategies.

37. Market Risks

This section details the risks arising from changes in market prices, including currency risks, interest rate risks, and commodity price risks.

38. Industry-Specific Risks

This section outlines risks specific to the automotive and motorcycle industry, such as competition, technological changes, and regulatory developments.

39. IT Risks

This section addresses risks related to information technology, including cybersecurity threats, system failures, and data breaches.

40. Financial Risks

This section provides a more detailed analysis of financial risks, including credit risk, liquidity risk, and market risk.

41. Other Risks

This section covers other significant risks faced by the Group that are not categorized elsewhere.

VIII. FINANCIAL INSTRUMENTS AND CAPITAL MANAGEMENT

42. Basic Principles

This section outlines the fundamental principles governing the Group's management of financial instruments and capital.

43. Classification and Fair Value

This section details the classification of financial instruments and presents their fair values, including methods used for fair value measurement.

44. Set-off of Financial Assets and Liabilities

This section discusses the conditions under which financial assets and liabilities are offset in the statement of financial position.

45. Hedges

This section describes the Group's hedging strategies, including the types of financial instruments used for hedging and the accounting for hedge relationships.

46. Capital Management

This section explains how the Group manages its capital structure to ensure financial flexibility and to support its strategic objectives.

IX. LEASES

47. Leases as Lessee (IFRS 16)

This section provides information on lease liabilities and the right-of-use assets recognized by the Group as a lessee under IFRS 16.

48. Leases as Lessor (IFRS 16)

This section details any leasing arrangements where the Group acts as a lessor.

X. EXPLANATIONS REGARDING RELATED PARTIES AND THE CORPORATE BODIES

49. Related Party Disclosures

This section identifies related parties and discloses transactions between the Group and these parties.

50. Corporate Bodies of PIERER Mobility AG

This section provides information about the members of the Executive Board and Supervisory Board of PIERER Mobility AG.

51. Executive Board and Supervisory Board Remuneration

This section details the remuneration paid to the members of the Executive Board and Supervisory Board.

XI. EVENTS AFTER THE REPORTING DATE

This section describes any significant events that have occurred after the reporting date that may affect the financial statements.

XII. GROUP COMPANIES (SCHEDULE OF EQUITY HOLDINGS)

This section provides a list of the companies included in the consolidated group, including their names, registration details, and ownership percentages.

XIII. APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS

This section indicates the date on which the consolidated financial statements were approved.# PIERER Mobility AG

2. PRINCIPLES OF FINANCIAL REPORTING

The consolidated financial statements for the period January 1st to December 31st 2021 were prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and in accordance with the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) insofar as they are applied in the European Union. The additional requirements stipulated by Section 245a (1) of the Austrian Commercial Code (UGB) were also met in this context.

The companies included in the consolidated financial statements are established on the basis of uniform financial reporting provisions. These provisions were applied by all consolidated entities. The companies included in the annual financial statements have prepared their financial statements as of the consolidated balance sheet date of December 31st.

The financial statements of all major domestic and foreign companies included in the consolidated financial statements, which are subject to mandatory auditing in accordance with national regulations, were audited by independent auditors and received an unqualified audit opinion.

The figures in the consolidated financial statements are reported in the functional currency of the Group parent, the euro. Unless otherwise specifically indicated, all amounts are rounded to the nearest 1,000 euros (EURk), which may give rise to rounding differences. The use of automated calculating tools may result in rounding differences with accumulation of rounded figures and with percentages.

ANNUAL REPORT 2021

3. NEWLY APPLIED STANDARDS AND INTERPRETATIONS

The following table shows the standards and interpretations whose application is mandatory for the first time and which have also already been adopted by the European Commission as of December 31st 2021:

First-time application	New or amended standards and interpretations	Published by the IASB	January 1st 2021
	Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 – Interest rate benchmark reform phase 2	August 27th 2020
	Amendments to IFRS 4 – Extension of temporary exemption from IFRS 9	November 21st 2012
First-time application	New or amended standards and interpretations	Published by the IASB	April 1st 2021
	Amendments to IFRS 16: Rent Concessions related to the coronavirus pandemic after June 30, 2021	March 31st 2021

All amended standards and interpretations are either irrelevant to the PIERER Mobility Group or have no material impact.

4. STANDARDS AND INTERPRETATIONS TO BE APPLIED IN THE FUTURE

The following table shows the amendments to standards and interpretations that have already been adopted by the European Commission, but whose application was not yet mandatory on the reporting date and which have also not been applied early:

New or amended standards and interpretations	Published by the IASB	January 1st 2022
Amendments to IFRS 3 – Reference to the framework concept	May 14th 2020
Amendments to IAS 16 Property, Plant and Equipment – Revenue before intended use	May 14th 2020
Amendments to IAS 37 Onerous contracts – Settlement costs of contracts	May 14th 2020
Improvements to IFRS 2018 – 2020 Amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41	May 14th 2020
IFRS 17 Insurance contracts (including amendments to IFRS 17)	May 18th 2017	January 1st 2023
Amendments to IAS 1 and IFRS Practice Statement 2 – Indication of accounting and valuation methods	February 12th 2021
Amendments to IAS 8 – accounting and valuation methods, Amendments in estimates and errors – Definition of accounting estimates	February 12th 2021

The IASB and the IFRIC have passed further standards and interpretations, the application of which was not mandatory during the 2021 financial year and/or which have not yet been adopted by the European Commission. These are the following standards and interpretations:

New or amended standards and interpretations	Date of application of IASB	Published by the IASB	EU-Endorsement?
IAS 1 – Classification of liabilities as current or non-current (including postponement of the date of entry into force)	January 1st 2023	January 23rd 2020	No
Amendments to IAS 12 Income taxes – Deferred taxes, relating to assets and liabilities arising from a single transaction	January 1st 2023	May 7th 2021	No
Amendments to IFRS 17 Insurance Contracts: First-time Adoption of IFRS 17 and IFRS 9 - Comparative Information	January 1st 2023	December 9th 2021	No

The PIERER Mobility Group assumes that there will be no material impact on the consolidated financial statements from the standards to be applied in the future.

ANNUAL REPORT 2021

5. ESTIMATES AND DISCRETIONARY DECISIONS

In the consolidated financial statements, certain estimates and assumptions must be made that affect the recognized assets and liabilities, the disclosure of contingent liabilities as at the reporting date, and the presentation of income and expenses for the financial year.

In making estimates, the Executive Board takes account of empirical values and current forecasts. The amounts actually arising may differ from the estimates if assumed parameters develop contrary to expectations. If new conditions become known, they are duly taken into account and previous assumptions are revised.

In particular, assumptions are made to assess the recoverability of goodwill and intangible assets of indeterminate useful life. Goodwill of EUR 130,711k (previous year: EUR 131,034k) was recognized at the reporting date, along with the “KTM” brand, which is valued at EUR 61,103k (previous year: EUR 61,103k), the “GASGAS” brand, which is valued at EUR 13,346k (previous year: EUR 13,346k), and the “FELT” brand, which is valued at EUR 3,707k (previous year: EUR 0k). For further information, see the explanatory notes in Note 21. “Goodwill” and Note 22. “Intangible assets”.

Deferred tax assets on tax loss carryforwards not subject to expiration are recognized based on the assumption that sufficient taxable income will be generated in the future to allow them to be utilized. Suitable allowances are made in the event of uncertainties in the assumptions. As of December 31st 2021, deferred tax assets for loss carryforwards of EUR 3,077k (previous year: EUR 7,721k) were capitalized. Based on current tax planning, management expects that the loss carryforwards recognized as of December 31st 2021 will be utilized over the next five years. For further details on deferred taxes, see the explanatory notes in Note 25. “Deferred tax assets”.

In cash flow hedge accounting, assessments are made regarding the occurrence of future cash flows. These cash flows could occur differently in terms of their amount and timing and therefore have an impact on cash flow hedge accounting.

Furthermore, there is some uncertainty as to the estimation for the recognition and measurement of liabilities for employee benefits. Assumptions are made concerning the following factors: Empirical values, demographic assumptions such as the retirement age of women/men and staff turnover, as well as financial assumptions such as the discount rate and future wage and salary trends. Liabilities for employee benefits of EUR 28,763k (previous year: EUR 28,665k) were recognized at the reporting date. For further information, see the explanatory notes in Note 33. “Liabilities for employee benefits”.

Estimates for provisions mainly relate to provisions relating to guarantees and warranties. To determine the amount of the provisions, a direct correlation was established for each product group between revenues and the guarantee and warranty expenses incurred. The percentage value of guarantee and warranty expenses in terms of revenue is checked several times a year and adjusted if necessary. As at December 31st 2021 provisions relating to guarantees and warranties of EUR 20,000k (previous year: EUR 14,612k) were recognized.

The determination of the fair values of assets and liabilities acquired as part of a business combination and the useful lives of these assets is based on assessments by the management.

Leases
Assessments of the term and interest rates are made. Further details are provided under Note 23. “Property, Plant and Equipment” and Note 47. “Leases as lessee”.

Estimates are made for inventories in connection with inventory valuation and analysis of coverage. In addition, allowance requirements are recorded on a case-by-case basis due to long storage periods and limited sales possibilities.

The following judgments were made in respect of the application of accounting policies in the PIERER Mobility Group:

Development costs
Development costs are capitalized in accordance with the accounting policy presented. The initial capitalization of costs is based on management assumptions for assessing the future economic benefit of the expenses incurred and the technical feasibility of the developed product or process, as well as its marketability.

Derecognition of receivables in connection with ABS and factoring agreements
Evaluations were made with respect to the conditions for derecognition under IFRS 9. For further details, please refer to Section VIII. “Financial instruments and capital management”.

ANNUAL REPORT 2021

Supplier finance
Assessments were made regarding the disclosure of liabilities in relation to the supplier finance program. For further details, please refer to Note 34. “Other current and non-current liabilities and trade payables”.

Consolidation
In determining whether control exists in accordance with IFRS 10, management exercises judgments in determining the relevant activities of the subsidiaries.# Climate-related assumptions:

When preparing the consolidated nancial statements, management took account of the effects of climate change, in particular in connection with the disclosures in risk reporting, in non-nancial reporting, and the declared sustainability targets of the PIERER Mobility Group. These considerations did not have any material effect on the judgments or estimates of nancial reporting. This is also in line with management‘s assessment that climate change will not have any material impact on the assessment of the going concern as part of the preparation of the nancial statements. The following specic points were taken into account:

The group continues to invest in new technologies, including the development of electric platforms, new climate-neutral drive types and the further development of battery technologies for two-wheelers. The group continues to invest in solutions for the local production of renewable energy for our facilities.

Management has taken account of the effects of climate change on a number of important estimates in the annual nancial statements, including:

The estimates of future cash ows used for recoverability assessments or assessing whether there are any indications of impairment
The carrying amount of non-current assets (e.g. intangible assets and goodwill)
The estimates of future prospects used in our assessment of the recoverability of deferred tax assets
The long-term assumptions for the identication and determination of decommissioning or replacement obligations.

II. SCOPE OF CONSOLIDATION

6. CONSOLIDATION PRINCIPLES AND METHODS

All subsidiaries are fully consolidated in the consolidated nancial statements of PIERER Mobility AG. Subsidiaries are companies controlled by the group. The nancial statements of subsidiaries are included in the consolidated nancial statements from the moment control begins and until the moment control ends. Unless otherwise stated, the amount for non-controlling interests is recorded with the pro rata net assets of the acquired company without goodwill. Investments in associates are included in the balance sheet item “Investments accounted for using the equity method”.

The reporting currency of the PIERER Mobility Group is the euro. The subsidiaries and the holdings accounted for using the equity method pre- pare their annual nancial statements in their functional currency. In this context, assets and liabilities included in the nancial statements to be consolidated are translated using the average exchange rate on the reporting date and the income statement items are translated using the mean rate of exchange for the nancial year.

The following signicant exchange rates for the PIERER Mobility Group were used for currency translation into the reporting currency:

	Closing rate 12/31/2021	Closing rate 12/31/2020	Average rate 2021	Average rate 2020
US-dollar	1.1326	1.2271	1.1816	1.1470
Swiss franc	1.0331	1.0802	1.0799	1.0709
Japanese yen	130.3800	126.4900	130.3200	121.8842
South African rand	18.0625	18.0219	17.5922	18.9139
Mexican peso	23.1438	24.4160	24.0516	24.7300
Australian dollar	1.5615	1.5896	1.5783	1.6567

7. CHANGES IN THE SCOPE OF CONSOLIDATION

All subsidiaries under the legal or de facto control of PIERER Mobility AG are included in the consolidated nancial statements as of December 31 st 2021. The number of companies included in the scope of consolidation changed as follows in the 2021 nancial year:

	Fully consolidated companies	At-equity companies
Balance as of 12/31/2020	66	4
Additions to the scope of consolidation	5	0
Eliminations from the scope of consolidation	-4	-1
Balance as of 12/31/2021	67	3
thereof foreign companies	47	2

PIERER Mobility AG, as the parent company of the PIERER Mobility Group, has not been included in this list. The entities included in the consolidated nancial statements and their dates of initial consolidation are listed in Section XII. “Group companies (schedule of equity holdings)”.

CHANGES IN THE FULLY CONSOLIDATED ENTITIES

Additions to the scope of consolidation:

In March 2021, KTM Forschungs & Entwicklungs GmbH, with its registered ofce in Munderng, was newly established and initially consolidated.
In July 2021, PIERER Mobility AG acquired an additional 30.46% of the shares in DealerCenter Digital GmbH, Landshut, Germany. At the time of the sale, PIERER Mobility AG held 45% of the company and now holds a total stake of 75.46% as of December 31 st 2021. The shares previously held were included using the equity method. Immediately before control was obtained, the previous shares were remeasured at their fair value. The initial consolidation resulted in an expense of EUR 1,258k, which is reported under other operating expenses.
The initial consolidation of the newly established PIERER E-Bikes Benelux, Gembloux, Belgium, took place in November 2021.
With effect from November 17 th 2021, PIERER E-Bikes GmbH acquired 100% of the shares in FELT GmbH, Munich, Germany.
PIERER E-Bikes GmbH, Munderng, Austria, together with MAXCOM LTD, Plovdiv, Bulgaria, established PIERER & MAXCOM MOBILITY OOD, Plovdiv, Bulgaria, a joint venture that will manufacture bicycles for PIERER E-Bikes GmbH, in December 2021. PIERER E-Bikes GmbH holds 50% of the shares in this company and has a controlling interest within the meaning of IFRS 10. The initial consolidation of PIERER & MAXCOM MOBILITY OOD took place on December 2 nd 2021.

Net assets of EUR 901k were acquired from all additions to the consolidated group. The net outow from the acquisitions amounted to EUR -13k.

135 ANNUAL REPORT 2021

Disposals from the scope of consolidation:

With effect from January 16 th 2021, PEXCO FRANCE SAS, Saint-Priest, France, was liquidated and deconsolidated, which had no impact on the consol- idated nancial statements.
With effect from June 7 th 2021, the shares held by PIERER E-Bikes GmbH in bikes&wheels 2 Radhandels GmbH, Wels, were sold to Pierer Industrie AG, Wels. The company was deconsolidated as of May 31 st 2021.
With effect from September 16 th 2021, the shares held by Husqvarna Motorcycles GmbH in Husqvarna Motorcycles Deutschland GmbH, Ursensollen, Germany, were sold to PIERER IMMOREAL GmbH, Wels.
KTM Sportmotorcycle MEA DMCC, Dubai, was liquidated with effect from September 30 th 2021. The company was deconsolidated as of August 25 th 2021.

All disposals from the scope of consolidation resulted in a net inow of EUR 947k. The net assets disposed of amounted to EUR 1,401k. In total, there were disposal losses of EUR 304k.

CHANGES IN ENTITIES ACCOUNTED FOR AT EQUITY

In July 2021, KTM AG, Mattighofen increased its stake in KTM Asia Motorcycle Manufacturing Inc., Philippines, from 34 % to 40% in July 2021 as a result of a capital increase designated as disproportionate of EUR 428k. This situation means that KTM AG continues to exercise signicant inuence over KTM Asia Motorcycle Manufacturing Inc., and so the equity measurement will be continued.

Another change relates to DealerCenter Digital GmbH, which is now fully consolidated in the consolidated nancial statements (see comments above under “Additions to the scope of consolidation”).

III. SEGMENT REPORTING

In PIERER Mobility AG, business activities are managed on the basis of the two business segments “Motorcycles” and “E-Bicycles”. The individual business groups are managed separately and reported to PIERER Mobility AG in accordance with IFRS accounting standards. The chief operating decision maker relevant for the segment report is the full Executive Board of PIERER Mobility AG. Segment reporting is based on the internal reports with the segments Motorcycles, E-Bicycles (formerly: E-Bikes) and Others.

MOTORCYCLES: The KTM subgroup forms the “Motorcycles” segment. KTM AG is the parent company of the KTM Group, which develops, produces and sells motorized leisure equipment (power sports), in particular under the “KTM”, “Husqvarna Motorcycles”, “GASGAS” brands, and “WP” brand components. As of December 31 st 2021, the KTM group included 49 subsidiaries, located in Austria, the United States, Japan, South Africa, Mexico, India, Brazil, Australia and New Zealand and in various other European and Asian countries, which are included within the consolidated nancial statements. In addition, the KTM group has equity holdings in assembly companies in the Philippines and China.

E-BICYCLES: The PIERER E-Bikes subgroup forms the “E-Bicycles” segment. PIERER E-Bikes GmbH, which was newly founded in 2020, is the parent company of the PIERER E-Bikes Group. With the “Husqvarna E-Bicycles”, “R RAYMON”, “GASGAS E-Bicycles” and “FELT Bicycles” brands, the focus is on the development, manufacturing and trading of e-bikes and bicycles. In total, the segment comprises 12 fully consolidated companies.

OTHERS: The “Others” segment encompasses PIERER Mobility AG, HDC GmbH, KTM Technologies GmbH (formerly: KTM E-Technologies GmbH), PIERER Innova- tion GmbH (formerly: KTM Innovation GmbH), Avocodo GmbH, DealerCenter Digital GmbH and Platin 1483. GmbH.

136 ANNUAL REPORT 2021

None of the segments has a dependency on external customers within the meaning of IFRS 8.34. Goods and services between the segments are provided on an arm‘s length basis. The segment performance indicator EBIT describes the operating result for the period before the nancial result and income taxes. The investments relate to additions to property, plant and equipment and intangible assets (excluding lease additions in accord- ance with IFRS 16). Income accounted for using the equity method is included in EBIT in accordance with the classication of the consolidated income statement. Working capital employed corresponds to the total of stock and trade receivables less trade payables at the reporting date. Net nancial debt corresponds to the total of current and non-current nancial liabilities (including lease liabilities) less cash at the reporting date.# IV. NOTES TO THE CONSOLIDATED INCOME STATEMENT

The consolidated income statement is prepared according to the cost of sales method. The grants received in the previous year for short-time working were offset against the related expenses of the respective functional areas of cost of sales, selling and racing expenses, research and development expenses, and administrative expenses in personnel benefit expenses.

8. REVENUES

Revenues, minus cash discounts, customer bonuses, and rebates, are generally recorded upon the passing of the risk as per the terms of the transaction (Incoterms) or at the time when performance was rendered. The breakdown by geographical area of external revenues is based on the location of the customers. The revenues by geographical regions of the group are made up as follows:

EURk	2021	2020
Europe	1,142,492	875,257
North America and Mexico	468,188	373,618
Other	431,050	281,507
TOTAL	2,041,730	1,530,382

Variable forms of consideration such as discounts, sales bonuses, and cash discounts are reported as revenue reductions. Variable consideration commitments are reported as contractual obligations within the meaning of IFRS 15. Contractual obligations for variable consideration relating to price discounts, sales bonuses and cash discounts amounted to € 50.4 million as of December 31st 2021 (December 31st 2020: € 35.6 million). As warranties are not sold separately, they only provide assurance that the products being sold meet the agreed specifications. As these warranties do not depart from the statutory warranty obligations or those that are typical of the industry in terms of their duration or their content, they are deemed to be assurance-type warranties, which do not constitute a separate performance obligation. Accordingly, the warranties continue to be recognized in accordance with IAS 37.

9. COST OF SALES

The group‘s cost of sales is made up as follows:

EURk	2021	2020
Cost of materials and purchased services	1,219,340	935,018
Personnel expenses	112,491	84,103
Amortization charged to capitalized development costs	59,839	50,705
Depreciation/amortization of property, plant and equipment and other intangible assets	28,031	28,362
Other operating expenses	28,930	5,362
TOTAL	1,448,631	1,103,550

Cost of sales includes expenses from foreign currency translation differences of EUR 5,518k (previous year: income of EUR 14,959k), measured at fair value through profit and loss. These exclude differences arising from the measurement of financial instruments.

10. SELLING AND RACING EXPENSES

The group‘s selling and racing expenses are made up as follows:

EURk	2021	2020
Cost of materials and purchased services	39,737	33,291
Personnel expenses	95,017	73,282
Depreciation/amortization of property, plant and equipment and other intangible assets	13,537	10,188
Other operating expenses	130,136	106,633
Sponsorship money and other operating income	-40,580	-31,178
TOTAL	237,847	192,216

11. RESEARCH AND DEVELOPMENT EXPENSES

The group‘s research and development expenses are made up as follows:

EURk	2021	2020
Cost of materials and purchased services	8,534	4,432
Personnel expenses	29,210	24,238
Depreciation/amortization of property, plant and equipment and other intangible assets	8,420	8,008
Other operating expenses	3,384	966
Subsidies and other operating income	-16,218	-14,253
TOTAL	33,330	23,391

Expenses disclosed under research and development expenses comprise research costs and non-capitalizable development costs. Personnel expenses before the effects of capitalizing development costs were EUR 77,374k (previous year: EUR 61,614k). In total, research and development expenses (before capitalized development costs) amounted to EUR 162,361k (previous year: EUR 137,713k) and thus 8.0% (previous year: 9.0%) of revenue.

12. ADMINISTRATIVE EXPENSES

The group‘s administrate expenses are made up as follows:

EURk	2021	2020
Cost of materials and purchased services	3,300	1,571
Personnel expenses	52,082	45,911
Depreciation/amortization of property, plant and equipment and other intangible assets	28,891	29,026
Other operating expenses	46,572	28,199
Other operating income	-1,988	-2,062
TOTAL	128,857	102,645

13. OTHER OPERATING EXPENSES

Other operating expenses totaled EUR 1,990k (previous year: EUR 164k). Other operating expenses mainly relate to effects of changes in the scope of consolidation amounting to EUR 1,562k. The other miscellaneous expenses include bank charges.

14. OTHER OPERATING INCOME

Other operating income is realized when the economic benefit arising from the underlying contract becomes probable and a reliable determination of the income can be made. The group’s other operating income is made up as follows:

EURk	2021	2020
Income from the disposal of assets	254	5
Consolidation changes	142	0
Other remaining income	348	0
TOTAL	744	5

15. EARNINGS FROM AT-EQUITY HOLDINGS

The share of the profit/loss of associates accounted for using the equity method is shown in the income statement as a separate item in the result from operating activities. These are mainly equity holdings that are involved in the operating activities of the PIERER Mobility Group as major suppliers or customers. The earnings from the companies accounted for using the equity method are made up as follows:

EURk	2021	2020
Kiska GmbH	1,485	207
KTM Asia Motorcycle Manufacturing Inc.	280	33
China Zhejiang CFMOTO-KTMR2R Motorcycles Co., Ltd.	-24	-1,392
DealerCenter Digital GmbH	-75	-28
TOTAL	1,666	-1,180

16. FINANCIAL AND INVESTMENT EARNINGS

The group’s financial and investment earnings are made up as follows:

EURk	2021	2020
Interest income	1,864	1,629
Interest expenses	-12,858	-15,213
Other financial and investment income (expenses)	9,097	-2,833
TOTAL	-1,897	-16,417

The group‘s other financial and investment income is made up as follows:

EURk	2021	2020
Foreign exchange valuation of bank deposits	8,652	-2,158
Cost of hedging	71	83
Valuation interest swap	365	-262
Impairment of non-current financial assets	0	-494
Gain / Loss from the disposal of non-consolidated subsidiaries	9	-2
TOTAL	9,097	-2,833

17. INCOME TAXES

The group’s income tax expense and income are attributable to current taxes and deferred taxes as follows:

EURk	2021	2020
Current tax	-34,933	-11,824
Deferred tax	-13,783	-9,545
TOTAL	-48,716	-21,369

Income taxes comprise taxes on income and earnings payable in each country as well as deferred taxes. The Austrian companies of the PIERER Mobility Group are subject to a corporate income tax rate of 25.0%. The calculation of foreign income taxes is based on the laws and regulations that are in force or have been adopted in the individual countries. The income tax rates applicable to foreign entities vary from 9.0% to 37.8%. A reconciliation between the expected tax expense for the financial year (application of the group tax rate of 25.0% to earnings before taxes) and the actual tax expense recognized can be presented as follows:

EURk	2021	2020
Profit before income taxes	191,588	90,824
Expected tax expenses / income	-47,897	-22,706
Non-temporary differences and other tax additions	-3,935	-93
Recognition / allowances / utilization of loss carryforwards	211	-4
Non-taxable results in consequence of consolidation changes	-776	-163
Taxes in relation to prior periods	-1,081	-1,058
Effects of foreign tax rates	-408	-827
Earnings from equity holdings	488	-219
Investment benefits	3,850	3,932
Miscellaneous	832	-231
TOTAL	-48,716	-21,369

18. EARNINGS PER SHARE AND APPROPRIATION OF NET PROFIT

Earnings per share in the current 2021 financial year amounted to EUR 3.34 (previous year: EUR 1.56) and are calculated as follows:

	2021	2020
Earnings - owner of parent company (EURk)	82,540	34,911
Total number of shares (units)	33,796,535	22,538,674
Effect of own and new shares (units)	-9,048,544	-194,376
Weighted average of shares	24,747,991	22,344,298
Undiluted (=diluted) earnings per share (EUR)	3.34	1.56

In accordance with the provisions of the Austrian Stock Corporation Act, the separate financial statement of PIERER Mobility AG as of December 31st 2021, prepared in accordance with Austrian accounting standards, forms the basis for the dividend distribution.For the 2021 financial year, it is proposed to distribute a dividend of EUR 1 per share (corresponding to a total of EUR 33,797k) from the retained earnings of PIERER Mobility AG amounting to EUR 142,257k and to carry forward the remaining amount. A dividend of EUR 11,173k was distributed from the retained earnings for 2020.

19. EXPENSES FOR THE AUDITOR OF THE FINANCIAL STATEMENTS

The expenses for the auditor KPMG Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft attributable to the reporting period break down as follows:

	EURk	2021	2020
		550	511
		51	22
		127	112
		728	645

20. EMPLOYEES

Employee numbers as stated include agency and external staff:


Balance as of 1/1/2020	4,586
Changes during the financial year	663
Balance as of 12/31/2020	5,249

As of December 31st 2021, there were 2,862 white-collar employees (previous year: 2,158) and 2,387 manual workers (previous year: 2,428). As of December 31st 2021, 4,340 employees (previous year: 3,822) were employed in Austria and 909 employees (previous year: 764) were employed abroad. On average, the group employed 4,948 people (previous year: 4,406), of which 2,660 were white-collar employees (previous year: 2,417) and 2,289 manual workers (previous year: 1,989). Total personnel expenses for 2021 financial year before the effects of capitalizing development costs were EUR 336,964k (previous year: EUR 264,910k).

142

V. NOTES TO THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

21. GOODWILL

In accordance with IAS 36.99, the detailed calculation of the recoverable amount as of December 31st 2020 was used for the impairment test of the cash-generating units (CGUs) “KTM” and “PIERER E-Bikes”. Since the last calculation of the recoverable amount, the assets and liabilities of the CGUs have not changed materially; the last calculation showed a material excess of the carrying amount of the CGUs. Based on an analysis of the events that have occurred and changed circumstances since December 31st 2020, management believes that there is an extremely remote likelihood that the recoverable amount would be less than the carrying amount in a current calculation.

The calculation as of December 31st 2020 was performed using the following method: The forecast of cash flows is based on financial budgets approved by management and/or forecasting, taking into account the medium-term strategy targets. The estimated cash flows are based on the medium-term strategy targets approved by management. Estimated cash flows beyond this period are calculated by extrapolation of budget/forecast values, whereby constant further development based on a growth rate of 1% is assumed from the third year onwards.

The breakdown of goodwill and its development as well as its allocation to the respective CGUs is as follows:

	2021	2020
Acquisition and production costs:
Balance as of 01/01	150,995	150,289
Changes in the scope of consolidation	-569	679
Currency translation	255	27
Balance as of 12/31	150,681	150,995
Accumulated depreciation and amortization:
Balance as of 01/01	19,961	19,978
Changes in the scope of consolidation	0	0
Currency translation	9	-17
Balance as of 12/31	19,970	19,961
Balance as of 12/31	130,711	131,034
KTM	110,309	110,063
PIERER E-Bikes	19,457	20,026
Avocodo	945	945

22. INTANGIBLE ASSETS

Intangible assets are capitalized in the same way as property, plant and equipment, at acquisition or production cost and valued less amortization. Depreciation is calculated in accordance with the straight line method and is based on the following expected useful lives:

	Useful life in years
Software	3 - 5
Intangible assets generated internally	5

143

ANNUAL REPORT 2021

For intangible assets generated internally, the production period is subdivided into research, development and model update phases. Costs incurred during the research and model update phases are immediately recognized in profit and loss. Capitalized development costs that can be clearly attributed to projects are amortized from the commencement of series production. In the 2021 financial year, development costs of EUR 112,959k (previous year: EUR 93,752k) were capitalized and a total of EUR 59,839k (previous year: EUR 50,705k) were amortized. As at December 31st 2021, development costs with a carrying amount of EUR 353,856k (previous year: EUR 308,617k) were included in intangible assets.

Intangible assets with an indeterminate useful life, such as the brands “KTM” in the amount of EUR 61,103k and “GASGAS” in the amount of EUR 13,346k, which were recognized in the original purchase price allocation, and the brand “FELT” in the amount of EUR 3,707k, which was acquired in the current 2021 financial year, are not amortized but subjected to an impairment test in accordance with IAS 36. The Executive Board assumes an indeterminate useful life for the brands because the rights are not subject to any restrictions as to time, in law or by contract in the relevant markets and because the sustained public awareness of the brand indicates that there has been no loss of economic value. The two brands “KTM” and “GASGAS” are allocated to the cash-generating unit “KTM” and the brand “FELT” to the cash-generating unit “PIERER E-Bikes”. As the brands do not generate cash inflows that are largely independent of the cash inflows from other assets, the impairment test is performed as part of the impairment tests of the respective “KTM” and “PIERER E-Bikes” goodwill (see Note 21. “Goodwill”).

The tables below provide a breakdown of intangible assets along with movements during the 2021 and 2020 financial years:

EURk	Concessions, industrial property rights and similar rights and benefits as well as resulting licenses	Customers, Brand values, Development cost	Advance payments	Total
Acquisition and production costs:
Balance as of 01/01/2021	79,908	544,663	3,711	628,282
Additions	9,698	117,381	3,374	130,453
Disposals	-10,929	-47,226	0	-58,155
Changes in the scope of consolidation	215	949	0	1,164
Currency translation	63	1	0	64
Transfers	3,612	0	-3,612	0
Balance as of 12/31/2021	82,567	615,768	3,473	701,808
Accumulated depreciation and amortization:
Balance as of 01/01/2021	50,718	150,729	0	201,447
Additions	13,539	61,416	0	74,955
Disposals	-9,770	-38,396	0	-48,166
Changes in the scope of consolidation	-8	0	0	-8
Currency translation	19	0	0	19
Transfers	0	0	0	0
Balance as of 12/31/2021	54,498	173,749	0	228,247
Carrying amount:
Balance as of 12/31/2021	28,069	442,019	3,473	473,561
Balance as of 12/31/2020	29,190	393,934	3,711	426,835

EURk	Concessions, industrial property rights and similar rights and benefits as well as resulting licenses	Customers, Brand values, Development cost	Advance payments	Total
Acquisition and production costs:
Balance as of 01/01/2020	67,293	466,336	5,474	539,103
Additions	7,094	106,618	3,517	117,229
Disposals	0	-28,772	0	-28,772
Changes in the scope of consolidation	632	0	0	632
Currency translation	-57	1	0	-56
Transfers	4,946	480	-5,280	146
Balance as of 12/31/2020	79,908	544,663	3,711	628,282
Accumulated depreciation and amortization:
Balance as of 01/01/2020	37,631	124,750	0	162,381
Additions	13,016	52,258	0	65,274
Disposals	0	-26,279	0	-26,279
Changes in the scope of consolidation	90	0	0	90
Currency translation	-19	0	0	-19
Transfers	0	0	0	0
Balance as of 12/31/2020	50,718	150,729	0	201,447
Carrying amount:
Balance as of 12/31/2020	29,190	393,934	3,711	426,835
Balance as of 12/31/2019	29,662	356,818	5,474	391,954

In the current financial year, development costs of an asset not available for use amounting to EUR 8,829k (previous year: EUR 2,493k) were derecognized due to the termination of the project. In the consolidated statement of cash flows, an adjustment of EUR 4,432k (previous year: EUR 687k) was made to additions to property, plant, and equipment to reflect transactions that had no cash flow effect. Government grants related to capitalized development costs are recognized over the expected useful life of the development costs in accordance with IAS 20. The net presentation in accordance with IAS 20 is applied, i.e. grants for non-current assets are deducted from the carrying amount of the asset in the consolidated statement of financial position.

23. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are valued at their acquisition or production cost less depreciation. Depreciation is calculated in accordance with the straight line method and is based on the following expected useful lives:

	Useful life in years
Buildings	10 - 50
Technical plant and machinery	2 - 10
Fixtures and fittings, tools and equipment	2 - 10

145

ANNUAL REPORT 2021

For the rights of use reported under property, plant and equipment from January 1st 2019 (IFRS 16), the useful life is between 3 and 10 years.

The tables below provide a breakdown of property, plant and equipment along with movements during the 2021 and 2020 financial years:

EURk	Real Estate Buildings	Technical plant and machinery	Operational and business equipment	Advance payments and investments in construction	Total
Acquisition and production costs:
Balance as of 01/01/2021	26,720	255,709	286,091	138,937	5,698
Additions	6,009	13,737	22,544	21,786	8,582
Disposals	0	-4,262	-11,004	-16,043	-529
Changes in the scope of consolidation	0	-213	-26	-660	0
Currency translation	9	1,531	1	1,195	0
Transfers	0	118	4,216	408	-4,742
Balance as of 12/31/2021	32,738	266,620	301,822	145,623	9,009
Accumulated depreciation and amortization:
Balance as of 01/01/2021	338	63,532	204,426	88,640	0
Additions	210	15,321	27,693	20,538	0
Disposals	0	-1,741	-10,639	-15,364	0
Changes in the scope of consolidation	0	-87	-7	-113	0
Currency translation	2	750	1	982	0
Transfers	0	0	-18	18	0
Balance as of 12/31/2021	550	77,775	221,456	94,701	0
Carrying amount:
Balance as of 12/31/2021	32,188	188,845	80,366

EURk	Real Estate	Buildings	Technical plant and machinery	Operational and business equipment	Advance payments and investments in construction	Total
Acquisition and production costs:
Balance as of 01/01/2020	23,096	213,792	256,109	123,507	10,310	626,814
Additions	2,208	10,067	22,357	13,063	4,740	52,435
Disposals	0	-473	-1,020	-3,518	-3	-5,014
Changes in the scope of consolidation	1,426	33,856	130	6,577	0	41,989
Currency translation	-10	-1,665	-11	-1,238	0	-2,924
Transfers	0	132	8,526	546	-9,349	-145
Balance as of 12/31/2020	26,720	255,709	286,091	138,937	5,698	713,155

Accumulated depreciation and amortization:
Balance as of 01/01/2020	176	49,897	178,158	72,086	0	300,317
Additions	164	13,895	27,063	19,893	0	61,015
Disposals	0	-108	-798	-2,801	0	-3,707
Changes in the scope of consolidation	0	511	10	454	0	975
Currency translation	-2	-663	-7	-992	0	-1,664
Transfers	0	0	0	0	0	0
Balance as of 12/31/2020	338	63,532	204,426	88,640	0	356,936

Carrying amount:
Balance as of 12/31/2020	26,382	192,177	81,665	50,297	5,698	356,219
Balance as of 12/31/2019	22,920	163,895	77,951	51,421	10,310	326,497

Additions to property, plant and equipment include investments amounting to EUR 24,626k (previous year: EUR 19,484k) as additions from leases, which had no cash flow effect on the reporting date. For more details, please refer to Note 47. “Leases as lessee”. In the consolidated statement of cash flows, an adjustment of EUR -995k (previous year: EUR -3,011k) was made to additions to other property, plant and equipment to reflect transactions that had no cash flow effect. Property, plant and equipment amounting to EUR 76,200k (previous year: EUR 76,200k) was secured by registered and deposited pledge agreements, primarily for liabilities owed to credit institutions, as of the reporting date. In accordance with IAS 20, investment grants for property, plant and equipment are recognized over the expected useful lives of the assets. The net presentation in accordance with IAS 20 is applied, i.e. grants for non-current assets are deducted from the carrying amount of the asset in the consolidated statement of financial position.

24. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

The investments in associates accounted for under the equity method are regarded individually as immaterial. As of December 31st 2021, the financial assets accounted for using the equity method are Kiska GmbH, KTM Asia Motorcycle Manufacturing Inc. and CFMOTO-KTMR2R Motorcycles Co., Ltd. The changes in companies accounted for using the equity method can be found in Note 7. “Changes in the scope of consolidation”. Kiska GmbH is a design business that provides development and design services. The reporting date of Kiska GmbH is March 31, which was determined prior to the acquisition of the investment. A change in the accounting date is not sought on account of materiality considerations. For the purposes of accounting under the equity method, unaudited interim financial statements as at December 31 were used. PIERER Mobility AG holds 50% of the company. KTM Asia Motorcycle Manufacturing Inc. was jointly founded in June 2016 in partnership with Ayala Corp. The company began the CKD (completely knocked down) assembly of KTM motorcycles in the Philippines in mid-2017. The KTM group‘s equity holding was increased from 34% to 40% in the 2021 financial year. The KTM joint venture in China conducted in partnership with CFMOTO was established in the 2018 financial year under the name “Zhejiang CFMOTO-KTMR2R Motorcycles Co., Ltd.”. The company began operation in the 2021 financial year. Mid-class motorcycles are produced in Hangzhou, China. The KTM group has an equity holding of 49% of the company.

147 ANNUAL REPORT 2021

The carrying amounts of the financial assets accounted for using the equity method developed as follows during the financial year:

EURk	2021	2020
Book value of investments on 1/1	13,252	13,628
Acquisition of holdings	773	1,514
Consolidation changes (successive acquisition)	-1,758	0
Proportionate net income	1,666	-1,180
Other comprehensive income	425	-100
Dividend	-803	-606
Other	7	-4
Book value of investments on 12/31	13,562	13,252

25. DEFERRED TAX ASSETS

Deferred tax assets relating to tax loss carryforwards are recognized insofar as they can be realized within a reasonable period. Deferred tax assets and deferred tax liabilities are reported on a net basis if they are subject to the same tax jurisdiction and are of a similar duration. Deferred tax items for differences between the tax base of fully consolidated interests or interests measured at equity and the corresponding consolidated equity are recognized only if realization is probable within the foreseeable future. Total deferred tax assets and liabilities were calculated from the following statement of financial position items:

EURk	12/31/2021	12/31/2020
Deferred tax assets:
Current assets:
Inventories	6,465	5,365
Non-current assets:
Fixed assets	2,653	1,656
Employee benefits	4,135	4,114
Provisions	1,974	3,406
Liabilities	4,002	3,896
	19,229	18,437
Offsetting	-12,689	-14,640
Loss carryforwards	3,077	7,721
	9,617	11,518
Deferred tax liabilities:
Currents assets	-3,269	-981
Non-current assets	-109,288	-100,540
Other	-109	-59
	-112,666	-101,580
Offsetting	12,689	14,640
	-99,977	-86,940

Deferred tax assets include amounts for remaining sevenths of write-downs of participations to going concern value pursuant to sec. 12 para. 3 no. 2 of the Austrian Corporate Tax Act (KStG) in non-current assets, in the amount of EUR 1,102k (previous year: EUR 1,609k).

148 ANNUAL REPORT 2021

The temporary differences in deferred tax liabilities in the “Non-current assets” item result mainly from development costs that cannot be capitalized for tax purposes and from quasi-permanent differences due to the recognition of the “KTM” brand as an asset. As at December 31st 2021 (as at the previous year end), it was to be assumed either that under current tax regulations the differences between the value for tax purposes of equity interests in consolidated subsidiaries and the proportion of equity recognized in the consolidated IFRS financial statements (outside-basis differences), which arise largely from retained profits/uncovered losses, will remain untaxed in the foreseeable future, or that their reversal can be controlled by the group. It was also to be assumed either that the differences between the value for tax purposes of equity interests in holdings accounted for using the equity method and the carrying value of those holdings (outside-basis differences) will remain untaxed in the foreseeable future, or that their reversal can be controlled by the group. In accordance with IAS 12.39, no deferred tax was recognized in connection with the temporary differences of EUR 242,829k (previous year: EUR 476,815k) arising in connection with holdings in subsidiaries and financial investments accounted for using the equity method.

Movements in deferred taxes in the financial year were as follows:

EURk	2021	2020
Deferred tax (net) at 1/1	-75,422	-69,464
Change in scope of consolidation	-296	0
Deferred taxes recognized in the income statement	-13,783	-9,545
Deferred taxes recognized in other comprehensive income	-942	132
Deferred taxes recognized in equity	-52	3,784
Foreign currency	135	-329
Deferred tax (net) at 12/31	-90,360	-75,422

The tax loss carryforwards existing and capitalized in the PIERER Mobility Group can be summarized as follows:

EURk	Loss carryforward 12/31/2021	thereof not recognized 12/31/2021	Remaining loss carryforward 12/31/2021	Deferred tax asset 12/31/2021
PIERER Mobility AG	62,754	-62,754	0	0
HDC GmbH	11,497	-11,497	0	0
Other	12,308	0	12,308	3,077
	86,559	-74,251	12,308	3,077

EURk	Loss carryforward 12/31/2020	thereof not recognized 12/31/2020	Remaining loss carryforward 12/31/2020	Deferred tax asset 12/31/2020
PIERER Mobility AG	56,335	-56,335	0	0
HDC GmbH	11,500	-11,500	0	0
Other	33,013	-42	32,971	7,721
	100,848	-67,877	32,971	7,721

149 ANNUAL REPORT 2021

Others amounting to EUR 1,138k (previous year: EUR 1,707k) relate to a future tax benefit from the liquidation loss of WP Suspension B.V. This can be claimed over a period of seven years from the date of liquidation. Deferred tax assets of EUR 688k were recorded for loss carryforwards of the KTM group (previous year: EUR 4,405k) and of the PIERER E-Bikes Group they amounted to EUR 5,004k (previous year: EUR 8,397k). Deductible temporary differences and unused tax losses (including remaining seventh depreciation) on which no deferred tax assets have been capitalized amount to EUR 74,509k (previous year: EUR 68,529k). The valuation allowance for loss carryforwards and temporary differences was recognized in the amount in which a medium-term realization of the deferred tax assets cannot be assumed with sufficient certainty from today‘s perspective.

26. OTHER NON-CURRENT ASSETS

EURk	12/31/2021	12/31/2020
Receivables from financing activities	1,197	1,885
Lease receivables from subleases	523	590
Other	2,313	662
	4,033	3,137

Other non-current assets include the investment in AC styria Mobilitätscluster GmbH, which is measured at fair value through other comprehensive income. Furthermore, other non-current assets include deposits and, in the previous year, the capitalization of a beneficial contract from the 2019 financial year in connection with the deconsolidation of KTM Components (Dalian) Co., Ltd., Dalian, China.

27. INVENTORIES

Inventories are measured at the lower of cost or net realizable value on the reporting date. Net realizable value is the estimated proceeds less estimated selling costs. Raw materials and supplies are measured using cost averaging based on an analysis of coverage, with write-downs in the event of limited usability.The economic value of existing inventories is also reviewed on a case-by-case basis and additional allowances are made as required for slow-moving items or items with limited possibilities of sale. Costs of acquisition include all costs that were incurred in order to bring the object to its required condition and to the relevant location. Costs of conversion comprise direct material and production costs based on normal capacity usage, plus appropriate portions of materials and production overheads. Administrative overheads and selling costs on the other hand do not form part of the costs of conversion. Interest on borrowings is not capitalized as the inventories do not constitute qualifying assets as defined in IAS 23. Inventories are made up as follows:

EURk	12/31/2021	12/31/2020
Raw materials, auxiliary materials and operating materials	127,698	67,813
Unfinished products	64,335	27,677
Finished products and goods	213,141	203,254
	405,174	298,744

EURk	12/31/2021	12/31/2020
Gross inventory level	432,956	327,347
- Allowances	-27,782	-28,603
Net inventory level	405,174	298,744

The carrying amount of inventories written down to the lower net realizable value is EUR 68,502k (previous year: EUR 61,076k).

28. TRADE RECEIVABLES

The gross value of third-party trade receivables is stated net of individual allowances of EUR 4,060k (previous year: EUR 4,176k). Movements in allowances on receivables were as follows:

EURk	Trade receivables
Balance as of 01/01/2020	2,921
Change in scope of consolidation	0
Currency translation	-81
Additions to specific valuation allowance	1,633
Additions to expected loss allowance	55
Utilization	-32
Reversals to expected loss allowance	-18
Reversals	-302
Balance as of 12/31/2020 = 01/01/2021	4,176
Change in scope of consolidation	0
Currency translation	-47
Additions to specific valuation allowance	1,070
Additions to expected loss allowance	28
Utilization	-224
Reversals to expected loss allowance	-5
Reversals	-939
Balance as of 12/31/2021	4,060

Expenses for the complete derecognition of trade receivables amounted to EUR 225k (prior year: EUR 121k).

29. CURRENT RECEIVABLES AND OTHER ASSETS

Subsidies are taken into account as soon as there is assurance that they will be received by the PIERER Mobility Group and that the group can comply with the applicable requirements.

EURk	12/31/2021	12/31/2020
Receivables from derivative financial instruments	4,605	3,389
ABS (asset backed securities) financing	12,537	15,894
Receivables from related company shareholders	17,803	5,080
Other	16,862	13,823
Other current financial assets	51,807	38,186
Subsidies	14,979	12,759
Receivables due from tax offices	4,536	4,250
Receivables from value added taxes (from tax group settlement with Pierer Industrie AG)	8,928	5,779
Advance payments on inventory and other prepayments	30,508	20,644
Other	43	3
Other current non-financial assets	58,994	43,435
Other current assets	110,801	81,621

Receivables sold in connection with the current ABS program are derecognized in accordance with the rules of IFRS 9. Under the ABS program, trade receivables insured on a revolving monthly basis are sold up to a maximum volume of EUR 250,000k (previous year: EUR 250,000k). For further information on the ABS program, please refer to Note 43. “Classification and fair value”.

30. CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash on hand and in banks, checks and time deposits with a fixed term of not more than three months (calculated from acquisition date) and are measured at their fair value as of the reporting date. For further details on changes in the cash status, please refer to the information on the statement of cash flows in Chapter VI of the notes to the consolidated financial statements.

31. CONSOLIDATED EQUITY

The development of the consolidated equity in the 2021 financial year and in the 2020 financial year is shown in the consolidated financial statements. The share capital of the company amounting to EUR 22,538,674 divided into 22,538,674 no-par-value bearer shares, each representing an equal interest in the share capital, was increased by EUR 11,257,861 to EUR 33,796,535 by resolution of September 29th 2021 by way of a capital increase in return for a contribution in kind, making partial use of the authorized capital pursuant to Section 5 of the articles of association amounting to EUR 11,257,861, by issuing 11,257,861 new shares and excluding the statutory subscription right of the existing shareholders. The new shares carry the same rights as the existing shares in PIERER Mobility AG. The issue price per new share is EUR 79.5. Only Pierer Bajaj AG (formerly: PTW Holding AG) was permitted to subscribe for the 11,257,861 new shares in return for a contribution of 5,042,925 registered shares (corresponding to 46.5% of the shares) of KTM AG to the company. The shares grant the customary rights due to stockholders under the Austrian Stock Corporation Act [Aktiengesetz]. These include the right to payout of the dividends resolved upon at the Annual General Meeting as well as the right to vote at the Annual General Meeting. All shares have been paid up in full. The share capital shown in the consolidated financial statements is equal to the figure reported in the separate financial statement of PIERER Mobility AG.

In the current financial year, the remaining 193,340 treasury shares were sold at a price of EUR 13,595k and with a profit of EUR 5,148k. The reserve for treasury shares as of the reporting date amounts to EUR 0k (previous year: EUR -8,447k). PIERER Mobility AG now no longer holds any treasury shares. The reserve in accordance with IFRS 9 includes the cash flow hedge reserve. The cash flow hedge reserve comprises the effective portion of the cumulative net changes in the fair value of hedging instruments used to hedge cash flows until subsequent recognition in profit or loss or direct recognition in the costs of acquisition or carrying amount of a non-financial asset or a non-financial liability. The reserve for hedging costs shows profits and losses on the portion excluded from the designated hedging transaction that relates to the forward element of the forward currency transaction. These are initially recognized as other comprehensive income and accounted for in the same way as profit and losses in the hedging transaction. The development of the cash flow hedge reserve and the reserve for hedging costs is explained in Note 45. “Hedges”.

Non-controlling interests comprise the shares of third parties in the equity of the consolidated subsidiaries:

2021

EURk	KTM AG	Other	Total	Percentage of non-controlling interests on reporting date
Revenue	1,876,418	165,312	2,041,730
Profit	146,067	-3,195	142,872
Other comprehensive income	6,364	1,378	7,742
Total comprehensive income	152,431	-1,817	150,614
Profit assigned to non-controlling interests	60,201	131	60,332
Other comprehensive income assigned to non-controlling interests	2,235	-7	2,228
Non-current assets	907,154	85,660	992,814
Current assets	951,711	89,194	1,040,905
Non-current liabilities	-610,265	-39,201	-649,466
Current liabilities	-544,853	-73,849	-618,702
Net assets	703,747	61,804	765,551
Carrying amount of non-controlling interests	2,633	2,776	5,409	0.25%
Cash flow from operating activities	359,846	7,517	367,363
Cash flow from investing activity	-183,746	-11,377	-195,123
Cash flow from financing activity	-35,985	8,364	-27,621
Cash change	140,115	4,504	144,619
Dividends to non-controlling interests	13,275	0	13,275

*Until October 2021, the percentage of non-controlling shareholders was approximately 48%

2020

EURk	KTM AG	Other	Total	Percentage of non-controlling interests on reporting date
Revenue	1,413,978	116,404	1,530,382
Profit	71,210	-1,755	69,455
Other comprehensive income	-3,292	-1,379	-4,671
Total comprehensive income	67,918	-3,134	64,784
Profit assigned to non-controlling interests	34,441	103	34,544
Other comprehensive income assigned to non-controlling interests	-1,589	0	-1,589
Non-current assets	861,467	80,528	941,995
Current assets	666,745	77,294	744,039
Non-current liabilities	-536,004	-45,425	-581,429
Current liabilities	-384,868	-65,618	-450,486
Net assets	607,340	46,779	654,119
Carrying amount of non-controlling interests	293,423	441	293,864	48.29%
Cash flow from operating activities	286,452	26,367	312,819
Cash flow from investing activity	-144,968	-2,041	-147,009
Cash flow from financing activity	-92,305	-12,384	-104,689
Cash change	49,179	11,942	61,121
Dividends to non-controlling interests	13,595	144	13,739

The non-controlling interests of KTM AG also include non-controlling interests of subsidiaries of KTM AG amounting to EUR 876k and relate to the two companies CERO Design Studio S.L. and KTM MOTOHALL GmbH. The carrying amount of other non-controlling interests as of December 31st 2021 mainly relates to PIERER & MAXCOM MOBILITY OOD. For the amounts of the equity holdings, please refer to the schedule of equity holdings in Section XII.

The effects of the transactions with non-controlling interests and the change in the proportion of equity attributable to the shareholders during the financial year were as follows:

EURk	12/31/2021	12/31/2020
Carrying amount acquired (-) or disposed of (+) for non-controlling interests	340,458	345
Purchase price received from (+) or paid (-) to non-controlling shareholders	-30,470	-1,005
Difference recorded in equity	309,988	-660

The difference recognized in equity mainly results from the increase of the shares in KTM AG from 51.71% to 99.75% in the current financial year. On the one hand, this relates to the contribution of around 46.5% of the shares in KTM AG by Pierer Bajaj AG (parent company of PIERER Mobility AG) to PIERER Mobility AG, as has already been discussed under this item. On the other hand, a further approx. 1.5% of the shares in KTM AG were acquired in the 2021 financial year. The equity holding in KTM AG thus increased from 51.71% to 99.75%.In the current financial year, PIERER Mobility AG also increased its shares in KTM Technologies GmbH from 70% to 100%. In the previous year, PIERER Mobility AG increased its shares in Avocodo GmbH from 70% to 100%. Other comprehensive income after tax developed as follows in the consolidated equity:

EURk	Provision as per IFRS 9	Reserves including total earnings	Foreign currency translation reserve	Total Interests non-controlling shareholders	Total consolidated equity
2021
Currency translation differences	0	0	3,437	3,437	1,480
Cash flow hedge	1,871	0	0	1,871	385
Revaluation of net debt from defined benefit plans	0	206	0	206	363
Total	1,871	206	3,437	5,514	2,228
2020
Currency translation differences	0	0	-2,219	-2,219	-2,057
Cash flow hedge	-1,215	0	0	-1,215	139
Revaluation of net debt from defined benefit plans	0	352	0	352	329
Total	-1,215	352	-2,219	-3,082	-1,589

32. FINANCIAL LIABILITIES

EURk	12/31/2021 (Nominal)	12/31/2021 (Carrying amount)	12/31/2021 (Term < 1 year)	12/31/2021 (Term > 1 year)
Promissory note loans	225,000	224,661	5,998	218,663
Registered bond	60,000	59,551	0	59,551
Liabilities owed to credit institutions	206,596	206,596	23,805	182,791
Liabilities from factoring program between group companies	2,498	2,498	2,498	0
Liabilities from supplier finance program between group companies	1,836	1,836	1,836	0
Lease liabilities	65,442	65,442	19,908	45,534
Other interest-bearing liabilities	2,802	2,802	2,802	0
Total financial liabilities	564,174	563,386	56,847	506,539

155 ANNUAL REPORT 2021

EURk	12/31/2020 (Nominal)	12/31/2020 (Carrying amount)	12/31/2020 (Term < 1 year)	12/31/2020 (Term > 1 year)
Promissory note loans	228,500	228,067	3,500	224,567
Registered bond	30,000	30,000	0	30,000
Liabilities owed to credit institutions	201,471	201,471	42,185	159,286
Liabilities from factoring program between group companies	3,669	3,669	3,669	0
Liabilities from supplier finance program between group companies	3,317	3,317	3,317	0
Lease liabilities	61,727	61,727	19,491	42,236
Other interest-bearing liabilities	2,432	2,432	2,432	0
Total financial liabilities	531,116	530,683	74,594	456,089

In July 2015, PIERER Mobility AG issued a promissory note loan in the amount of EUR 56,500k with a term of five and seven years. In January 2017, a partial amount of the promissory note loan in the amount of EUR 32,000k, EUR 25,500k of it with a term of 5 years and EUR 6,500k of it with a term of 7 years, was repaid early. A partial amount of the promissory note loan totaling EUR 12,500k with a term of 5 years was repaid early by way of a termination letter dated July 13th 2018, effective July 17th 2018, and a termination letter dated October 4th 2018, effective October 8th 2018. In July 2020, EUR 6,000k of the promissory note loan with a term of 5 years was repaid as scheduled. In June 2016, a promissory note loan with an issuing volume of EUR 120,000k and a term of five, seven or ten years was placed by KTM AG in order to refinance the bond repaid in April 2017. In June 2018, a further promissory note loan with a volume of EUR 135,000k and terms of seven and ten years was successfully placed. In addition, EUR 32,500k of the promissory note loan issued in 2016 was repaid early. In May 2021, KTM AG issued registered bonds with a term of 12 years in the amount of EUR 30,000k. Furthermore, PIERER Mobility AG previously issued a registered bond in the amount of EUR 30,000k with a term of 10 years in July 2015.

33. OBLIGATIONS FOR EMPLOYEE BENEFITS

Employee benefit obligations consist of obligations relating to severance pay and anniversary bonuses:

EURk	12/31/2021	12/31/2020
Severance payments	21,202	21,946
Anniversary bonuses	7,561	6,719
Total	28,763	28,665

The PIERER Mobility Group is obligated by law to make a severance payment to all employees in Austria whose employment relationship commenced before January 1st 2003 upon termination by the employer or upon retirement. The amount of this defined benefit obligation (DBO) is dependent on the number of years of service and on the relevant salary at the time of termination. For all employees in Austria who joined after December 31st 2002, the company pays 1.53% of their gross monthly salary each month into a staff severance pay fund that invests the contributions in an account maintained for the employee; at the end of the employment relationship, the amount thus accumulated is paid out or the claim thereto is passed on. The company’s obligation extends only to the payment of the contributions, which are recognized as expenses in the financial year for which they were paid (defined-contribution obligation). For employees of Austrian group companies whose employment commenced on or after January 1st 2003, contributions amounting to 1.53% of their wages or salaries, as the case may be, were paid into a statutory staff severance pay fund. Total contributions of EUR 2,488k were paid during the past financial year (previous year: EUR 2,218k).

156 ANNUAL REPORT 2021

Movements in the net liability under the defined benefit plans in respect of severance pay were as follows during the financial year:

EURk	12/31/2021	12/31/2020
Conditional benefit:
Balance as of 01/01	21,946	22,501
Service cost	752	838
Interest expenses	231	245
Payments made	-622	-588
Actuarial gain / loss (other net result)	-759	-908
Changes in the scope of consolidation	0	1
Miscellaneous	-346	-143
Balance as of 12/31	21,202	21,946

The weighted maturity terms (duration) of the severance payment obligations as of December 31st 2021 amount to 12 years (previous year: 13 years).

The actuarial profit/loss is made up of the following factors:

EURk	12/31/2021	12/31/2020
Change in expected values	-260	-807
Change in demographic assumptions	-196	5
Change in financial assumptions	-303	-106
Actuarial gain / loss	-759	-908

The measurement of the obligation is based on the following assumptions:

	12/31/2021	12/31/2020
Discount rate	1.23%	0.90%
Wage / salary trend	2.75%	2.50%
Retirement age (years) women/men	62 - 65 years	62 - 65 years

The discount rate was determined taking into account the average duration and average remaining life expectancy. The discount rate is the market yield on high quality, fixed-interest corporate bonds at the end of the reporting period. Staff turnover is determined on a company-specific basis and takes account of age and length of service. The actuarial measurements are based on country-specific mortality tables. The chosen retirement age is the statutory retirement age in each country.

157 ANNUAL REPORT 2021

A change (+/- 0.5 percentage points) in the “discount rate” and “salary / wage trend” parameters would have had the following effects on the present value of future payments as of December 31st 2021:

Parameter	Change -0.50%	Change +0.50%
Discount rate	6.2%	-5.7%
Wage / salary trend	-5.6%	6.0%

Parameter	Change -0.50%	Change +0.50%
Discount rate	6.5%	-6.3%
Wage / salary trend	-6.2%	6.3%

The companies in the PIERER Mobility Group are obligated under collective-bargaining agreements to pay their employees in Austria anniversary bonuses upon attaining a certain number of years of service (from 25 years of service upward) (defined benefit obligation). The interest result is recognized under “Other financial result”.

Movements in obligations relating to claims to anniversary bonuses were as follows:

EURk	12/31/2021	12/31/2020
Balance as of 01/01	6,719	6,846
Service cost	667	702
Interest expenses	77	78
Payments made	-80	-95
Actuarial gain / loss (profit or loss)	177	-825
Miscellaneous	1	13
Balance as of 12/31	7,561	6,719

34. OTHER CURRENT AND NON-CURRENT LIABILITIES AND TRADE PAYABLES

Other non-current liabilities essentially comprise the following:

EURk	12/31/2021	12/31/2020
Deposits	11,364	7,600
Other financial liabilities	1,470	854
Other non-current financial liabilities	12,834	8,454
Other non-current non-financial liabilities	1,353	1,281
Other non-current liabilities	14,187	9,735

158

Other current liabilities essentially comprise the following:

EURk	12/31/2021	12/31/2020
Sales bonuses	46,678	28,365
Price rebates	3,709	7,236
Liabilities from derivative financial instruments	1,988	3,078
Other financial liabilities	15,954	10,920
Other current financial liabilities	68,329	49,599
Employee benefits	49,486	30,289
Prepayments	5,998	2,808
Tax liabilities	9,460	3,715
Other non-financial liabilities	44	205
Other current non-financial liabilities	64,988	37,017
Other current liabilities	133,317	86,616

Current employee benefits mainly include liabilities for unconsumed vacations, liabilities for employee bonuses, liabilities to district health insurance funds, and wage and salary liabilities.

Supplier finance: Companies in the PIERER Mobility Group have entered into a supplier finance program (a revolving facility for the financing of trade payables) with an Austrian credit institution. Suppliers can sell their receivables from the PIERER Mobility Group to the credit institution before the due date. The PIERER Mobility Group is not released from its original obligation and, due to a quantitative and qualitative audit, there is no significant change in the contractual terms and conditions. The liabilities continue to be shown under trade payables and are reported in cash flow from operating activities. As of December 31st 2021, this supplier finance program affected trade payables of EUR 167,344k (previous year: EUR 119,558k). This is 42.3% (previous year: 45.6%) of total trade liabilities as at the reporting date in the amount of EUR 395,581k (previous year: EUR 262,099k). In addition to suppliers outside the group, such a program was also concluded between Austrian companies of the PIERER Mobility Group.From the point of view of the PIERER Mobility group, no exchange of services took place; it merely made use of external financing, which is reported under current financial liabilities. Cash flows are reported under cash flow from financing activities. As of December 31st 2021, liabilities from this program totaled EUR 169,180k (previous year: EUR 122,875k), of which, as of December 31st 2021, the relationships between group companies amounting to EUR 1,836k (previous year: EUR 3,317k) are presented as current financial liabilities in the consolidated financial statements of PIERER Mobility AG.

Contingent liabilities: PIERER Mobility AG has issued a guarantee for DealerCenter Digital GmbH, Landshut, Germany to RLB OÖ, arising from obligations to suppliers, up to a maximum amount of TEUR 500 (previous year: TEUR 0). For a reverse factoring program at Erste Group Bank AG, PIERER Mobility AG has issued a letter of comfort for PIERER E-Bikes GmbH, Vienna, in the amount of TEUR 15,000 (previous year: TEUR 15,000). As of the reporting date, the reverse factoring program resulted in a liability amount of TEUR 15,000 (previous year: TEUR 0). In the previous year, PIERER Mobility AG issued a guarantee for PEXCO GmbH, Schweinfurt, Germany to KGI Bank Co., Ltd., Taiwan, for obligations to suppliers up to a maximum amount of TEUR 16,299. The amount outstanding to suppliers in the previous year was EUR 7,685 thousand.

159 ANNUAL REPORT 2021

35. PROVISIONS

The group makes provisions relating to guarantees and warranties in relation to known, expected individual cases. The amounts of expected expenses are primarily based on previous experience and are recorded at the time the products are sold as an expense affecting profit and loss. The estimation of future expenses is subject to uncertainties, which may lead to an adjustment of the provisions recognized in the future. It cannot be ruled out that the actual expenses for these measures may be higher or lower than the provision made for these purposes in an unforeseeable way.

Movements in provisions in the financial year were as follows:

EURk	Balance as of 1/1/2021	Additions	Disolutions	Utilization	Balance as of 12/31/2021
Current provisions
Provisions for guarantee and warranty	14,612	19,560	-97	-14,075	20,000
Provisions for legal actions	596	185	0	-146	635
Other provisions	2,771	407	-250	-458	2,470
	17,979	20,152	-347	-14,679	23,105

VI. NOTES TO THE STATEMENT OF CASH FLOWS

The changes in the balance sheet items presented in the statement of cash flows cannot be derived directly from the balance sheet, as non-cash effects are neutralized. Other non-cash expenses (income) mainly include valuations of foreign currency receivables and liabilities, write-downs of receivables and inventories, and non-cash income from grants. The effects associated with changes in the scope of consolidation have been eliminated and are accounted for in cash flow from investing activity.

The changes in the recognized financial liabilities and the amounts disclosed in the statement of cash flows can be reconciled as follows:

EURk	Balance as of 1/1/2021	Changes affecting cash flow	Changes not affecting cash flow	Carrying amount 12/31/2021	Acquisition	Reclassiﬁcation	Scope of consolidation changes	Transaction costs
Current ﬁnancial liabilities	55,103	-49,976	0	36,939	32,513	-1,144	0	443
Non-current ﬁnancial liabilities	413,853	79,528	0	461,005	-32,513	0	131	6
Current lease liabilities	19,491	-18,431	0	19,908	18,928	-80	0	0
Non-current lease liabilities	42,236	0	23,342	45,534	-18,928	-48	0	-1,068
Total	530,683	11,121	23,342	563,386	-1,272	131	0	-619

EURk	Balance as of 1/1/2020	Changes affecting cash ﬂow	Changes not affecting cash ﬂow	Carrying amount 12/31/2020	Acquisition	Reclassiﬁca‐ tion	Scope of consolidation changes	Transaction costs
Current ﬁnancial liabilities	69,772	-53,545	0	55,103	28,518	10,409	0	-51
Non-current ﬁnancial liabilities	424,763	0	0	413,853	-28,518	17,498	103	7
Current lease liabilities	16,586	-18,821	-47	19,491	21,773	0	0	0
Non-current lease liabilities	45,546	0	18,463	42,236	-21,773	0	0	0
Total	556,667	-72,366	18,416	530,683	27,907	103	0	-44

160 VII. RISK REPORT

36. RISK MANAGEMENT

As a group of companies conducting business on a global scale, the PIERER Mobility Group faces a multitude of possible risks that are monitored by means of a comprehensive risk management system. The Executive Board and Supervisory Board are periodically informed about risks that may have a major impact on the group’s business operations. Management takes timely action to avoid, minimize and hedge risks. An internal control system adapted to the company’s needs and incorporating basic principles such as segregation of duties and dual control has been integrated into the financial reporting process. Internal and external audits ensure that the processes are continually improved and optimized. Furthermore, a uniform reporting system is in place throughout the group, for the ongoing management and control of the risk management process.

Continuous growth depends on a variety of factors, such as demand behavior, product development, changes in foreign exchange rates, the general economic setting in the individual sales markets, prices of goods purchased from others, and talent management. Increased market research activities and a model policy reflecting the resulting findings are the means of responding to a market environment characterized by rapidly changing situations.

In order to prevent risks associated with fraud, corruption, and bribery, employees are obliged to behave in accordance with the principles defined in the Code of Conduct. The code is binding for all employees, managers, and board members as well as for consultants, business partners, and customers of the PIERER Mobility Group. The 2021 financial year also marks the conclusion of accepting the Code of Conduct as a further Annex and thus as an integral part of the existing dealer contracts for the KTM group. Since the beginning of 2020, this has already been the case with new dealer contracts and also with new contractual relationships in the supply sector.

In order to counteract negative macroeconomic and geopolitical effects, PIERER Mobility promotes global diversification of the sales markets. The greatest relative growth in the coming years is expected in Asia. In order to promote this growth, intensive cooperation with our strategic partner Bajaj is being continuously expanded. In addition, investments have been made in production sites with local partners in China and the Philippines.

The earnings position of PIERER Mobility AG (as an individual company) is shaped by expenses in connection with financing raised, acquisitions of investments and project expenses and depends to a large extent on the dividend policy of its investees. The investment in the KTM group is currently the largest and most significant investment of PIERER Mobility AG. The PIERER E-Bikes Group represents another core operating investment of the group.

In accordance with the requirements of Section 243(c) of the Austrian Commercial Code (UGB), a corporate governance report has been drawn up. In this regard, we refer to the publication in the annual report of PIERER Mobility AG or to the website of PIERER Mobility AG.

161 ANNUAL REPORT 2021

37. MARKET RISKS

CYCLICAL RISK

COMPETITION AND PRICING PRESSURE

Competition on the motorcycle market in industrialized countries is particularly intense; the strongest competitors are four Japanese and three European manufacturers and, to a lesser extent, a U.S. manufacturer, some of which have greater financial resources, higher sales figures and market shares. The street motorcycle market is moreover characterized by high pricing pressure, and new competitors are trying to enter the market by relying on a low-price strategy. Thanks to its successful market strategy, the PIERER Mobility Group is Europe‘s leading manufacturer of powered two-wheelers. The full integration of GASGAS as the third brand and the further development of the dealer network has also contributed to this.

SALES RISK

The largest individual sales markets of the Motorcycles segment (KTM group) and consequently also of the PIERER Mobility Group are the European and the US markets. A slump in these markets could have a negative impact on business activities. Entering new markets involves a major cost risk as, in some of these markets, the sales trends as well as the geopolitical conditions are difficult to assess. By collaborating with its strategic partner Bajaj Auto Ltd., Pune, India, the company is working steadily toward implementing a global product strategy in the motorcycle sector.

The largest individual sales markets of the E-Bicycles segment are currently the DACH region. A slump in these markets could have a negative impact on the business activities of the PIERER E-Bikes Group. In order to diversify this risk, the PIERER E-Bikes Group is pursuing the goal of expanding successfully in other markets.# 38. INDUSTRY-SPECIFIC RISKS

RESTRICTIONS RELATING TO MOTORCYCLING

PROCUREMENT RISK

In the current situation, the procurement risk faced by the KTM group is principally failing to receive ordered components or receiving them on dates other than those originally agreed. In order to ensure the best possible availability of components, there is a major focus on long-term cooperations with our supply partners as well as the careful selection of excellent new suppliers in accordance with established criteria. The group works continuously on developing its relationships with its suppliers. A deep mutual understanding of the processes is essential here. As the quality of the products is strongly determined by the quality and properties of the sourced subcomponents, particular attention is paid to suitable operating facilities and production processes of suppliers, as well as their financial strength and compliance with ecological, social and ethical standards.

The procurement of components and bicycles is planned for the medium term. Short-term fluctuations can also be offset by appropriate storage capacities. The products are priced on the basis of fixed negotiated purchase prices. Prices and capacities are agreed with suppliers in advance and secured.

The PIERER E-Bikes Group has several suppliers from different countries in its portfolio to reduce the risk of dependency, as far as possible, and increase the stability of the supply chains. As a risk, the timely availability of frames and drive components places increased demands on suppliers. Bicycles and bicycle parts purchased from outside Europe incur import duties of around 6%. Rising or falling import duties lead to higher or lower purchase prices and may have a positive or negative impact on margins if these effects are not passed on to customers in full.

In the second year following the outbreak of the COVID-19 pandemic, the PIERER Mobility Group faced increasing difficulties with regard to the supply of semiconductors and the associated shortages of electronic components. In order to support its suppliers in this situation, the group actively intervened in the procurement of electronic components and was thus able to prevent major shortages both at suppliers and at its own production sites. In addition to the shortage of electrical components, there were also bottlenecks in the supply of raw materials such as aluminum and plastic granulate, but these only had immaterial effects due to intensive cooperation in the supply chain. For 2022, it is expected that the situation will worsen – at least in the first two quarters. The difficult supply situation for suppliers, capacity bottlenecks at suppliers themselves and interruptions to logistical processes will continue to require close coordination with our partners. To reduce risk, among other things, stock at suppliers was built up in 2022, a market intelligence system for electronic components was introduced, and the logic of our scheduling agreement releases adapted to the changed situation.

RESEARCH AND DEVELOPMENT, RACING

Technical innovations and the introduction of new products are largely responsible for the PIERER Mobility Group’s competitive position. To this end, new trends must be identified promptly. To counteract the risk, our own products’ innovative capacity must be ensured. The PIERER Mobility Group therefore attaches great importance to identifying trends at an early stage, conducting research and development in technical and functional areas, and researching what customers want in order to develop innovative products that reflect what the market wants.

Racing achievements are not only an important marketing instrument for the company but also form the basis for product development and set standards for series development. Valuable experience is gathered whenever products can be tested in racing conditions at racing events. Before being introduced into series production, all technical innovations are moreover subjected to comprehensive testing by the quality management system so as to eliminate, to the greatest extent possible, any technical defects that could have a negative effect on earnings development.

PRODUCT LIABILITY RISK

The PIERER Mobility Group is also exposed in its business activity to claims for damages owing to accidents and injuries. This applies especially to the U.S., where claims asserted in product liability cases involve higher amounts of liability. In addition to existing safeguards, this risk is minimized by comprehensive quality control in all production areas.

163 ANNUAL REPORT 2021

39. IT RISKS

We apply the same high quality standards in the area of data security and data protection as we do for our products. The PIERER Mobility Group has implemented an IT security and risk management system for the purpose of identifying and managing company-relevant risks in the area of information security. In addition, evidence of compliance and the exercising of due diligence when handling and using information and equipment for the processing of information is provided and documented in respect of customers, the Executive Board and the general managers of each participating company.

The constantly growing IT and cyber risks are countered by ongoing evolution of IT security measures and using the latest IT security technologies. Cyber attacks are averted with a multi-stage technical concept using the latest security features such as intrusion prevention systems and additional security systems which are operated upstream or internally. Behavior-based security solutions are also used with a view to identifying security-related abuse. Incidents are identified and handled by a malware incident response process. In parallel, regular internal and external vulnerability analyses are performed and any vulnerabilities identified are countered by means of an established patch and update management process. Regular internal and external security audits are documented in risk management, any findings are evaluated and prioritized, and a solution is then applied. Care is taken to ensure that all users of IT systems possess the requisite knowledge and awareness for the use of IT within the scope of their role via the provision of regular general IT security awareness training. This training is provided in a preventative and traceable manner.

The ongoing COVID-19 pandemic made it necessary for a large number of employees to perform their work from home during the 2021 financial year and this continues to be the case. The measures taken to develop the IT infrastructure on an ongoing basis over the past few years have been retained, enabling the PIERER Mobility Group to overcome these exceptional challenges and to still provide its employees with remote workplaces in an uncomplicated and secure manner.

40. FINANCIAL RISKS

The PIERER Mobility Group is subject to credit, market, currency and liquidity risks regarding its assets, liabilities and planned transactions. Financial risk management is aimed at controlling and limiting those risks. The Executive Board and the Supervisory Board are informed on a regular basis about risks that can have a major impact on the group’s business operations. The principles of financial risk management are laid down and monitored by the Supervisory Board and the Executive Board. Group Treasury is responsible for their implementation.

To protect itself against the financial risks described below, the PIERER Mobility Group uses derivative financial instruments in order to safely hedge cash flows from operating activities against fluctuations in exchange rates and/or interest rates. The hedging horizon generally covers currently open items and any transactions planned for the next twelve to eighteen months. In exceptional cases, strategic hedge positions involving longer time periods may be entered into in consultation with the Supervisory Board.

CURRENCY RISKS

As an enterprise doing business on a global scale, the PIERER Mobility Group is influenced by general global economic data such as changes in currency parities or developments in the financial markets. As the US dollar represents the highest individual foreign currency risk faced by KTM, movements in the US dollar exchange rate are of particular importance to the development of revenue and income. Due to the increasing importance of USD in purchasing, the foreign currency risk associated with the USD is significantly reduced (“natural hedge”). Approximately 25% of revenues were earned in US dollars in financial year 2021 (previous year: 25%). Currency hedging measures, in particular hedging strategies, can largely offset these currency shifts over at least one model year.The group is exposed to further currency risks where financial assets and liabilities are settled in a currency other than the local currency of the relevant company. The companies of the group predominantly do their invoicing in local currency and largely take out financing in their local currency. Financial investments are primarily made in the local currency of the investing group company. For these reasons, most resulting currency positions will be closed out naturally.

164 The main causes of ineffectiveness in currency hedges are: the impact of the credit risk of the counterparties and the group on the fair value of the forward currency transactions that is not reflected in the change in the fair value of the hedged cash flows attributable to changes in foreign exchange rates; changes in the transaction date of the hedged items.

Sensitivity analyses have been performed on currency risks in relation to financial instruments in order to show the effects that hypothetical changes in the exchange rates have on profit or loss (after taxes) and equity. The relevant balances as of the reporting date and foreign currency purchases and sales budgeted for the 2022 financial year were used as a basis. It was assumed that the risk faced on the reporting date essentially represents the risk present during the financial year. The group tax rate of 25% was used as the tax rate. Furthermore, it was assumed in the analysis that all other variables, in particular the interest rates, remained constant. Currency risks relating to financial instruments of a monetary nature that are denominated in a currency other than the functional currency were included in the analysis.

In the scope of the sensitivity analysis, effects of changes in the exchange rate of ± 10% are shown as profit or loss, other comprehensive income, and equity. The PIERER Mobility Group bases the analysis on the following assumptions:

For the sensitivity of profit and loss, the group‘s bank balances, receivables and payables are considered, as are future receipts and payments in foreign currency that are not accounted for in the functional currency of the group company. Account is also taken of open derivatives on cash flow hedges where the hedged item has already been realized on the reporting date (recognized as income).

For the sensitivity of other comprehensive income, account is taken of open derivatives from cash flow hedges where the hedged item has not yet been realized on the reporting date (movements are not recognized in profit and loss). The exposure corresponds to the notional amount of the open derivatives.

Increase (+) / Decrease (-)	10% increase	10% devaluation
EURk	12/31/2021	12/31/2020	12/31/2021	12/31/2020
Change in net result	-23,490	-22,223	28,709	27,161
Change in currency-related cash flow hedge provisions	10,995	2,199	-13,439	-2,688
Change in equity	-12,495	-20,024	15,270	24,473

INTEREST RATE RISKS

Financial instruments on both the assets side and the liabilities side mainly carry interest at variable rates. The risk therefore comprises rising interest expenses or falling interest income resulting from an adverse change in market interest rates. The PIERER Mobility Group has refinanced part of its debt at variable rates and is thus exposed to the risk of interest rate fluctuations on the market. Regular monitoring of the money and capital markets and, in some cases, the use of interest rate swaps (fixed interest rate payer swaps) serve to respond to this risk. Under the interest rate swaps entered into, the concern receives variable interest payments and, in return, pays fixed interest on the notional amounts of the contracts entered into. Interest rate risks thus result mainly from primary financial instruments carrying interest at variable rates (cash flow risk).

Sensitivity analyses were performed on the interest rate risks of these financial instruments in order to show the effects that hypothetical changes in the market interest rate level have on profit or loss (after tax) and equity. The relevant balances as of the reporting date were used as a basis. It was assumed that the risk faced on the reporting date essentially represents the risk present during the financial year. The group tax rate of 25% was used as the tax rate. Furthermore, it was assumed in the analysis that all other variables, in particular the exchange rates, remained constant.

165 ANNUAL REPORT 2021

The main causes of ineffectiveness in interest rate hedges are: the impact of counterparty and group credit risk on the fair value of the interest rate derivatives that are not reflected in the change in fair value of hedged cash flows attributable to changes in the interest rates differences in the parameters (e.g., interest rate adjustment dates) between the derivatives and the hedged items

A sensitivity analysis was performed on interest rate risk. A change of 50 basis points would have the following effects on profit or loss, other comprehensive income and equity:

Increase (+) / Decrease (-)	Increase by 50 BP	Decrease by 50 BP
EURk	12/31/2021	12/31/2020	12/31/2021	12/31/2020
Change in net result	324	-960	-1,311	263
Change in currency-related cash flow hedge provisions	-2,316	-1,804	2,316	1,711
Change in equity	-1,992	-2,764	1,005	1,974

In connection with the IBOR reform, Group Treasury conducted a review of how the affected reference interest rates are used in the financial instruments utilized. With regard to existing financial instruments, Treasury works closely with our business partners and actively monitors the development of reference interest rates and standards customary in the industry to be able to make adjustments. For example, transitional arrangements have been renegotiated in all current contracts and financial instruments that have adjustment clauses relating to new reference interest rates. These regulate how the reference interest rate can be replaced if it is temporarily or permanently unavailable. The use of the new reference interest rates has been agreed, without exception, for contracts and financial instruments that were newly concluded in the financial year.

DEFAULT RISKS (CREDIT OR CREDITWORTHINESS RISKS)

The default risk is the risk of financial losses if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The default risk generally arises from trade receivables. On the assets side, the carrying amounts reported also represent the maximum default risk. In addition, there are no general set-off agreements, with the exception of the set-off agreement described under note 44 in the notes to the Consolidated Financial Statements.

Trade receivables

The default risk on receivables from customers may be rated as low, as ongoing checks of the creditworthiness of new and existing customers are performed and collateral is requested. Risk management carries out an analysis and assessment of new customers. Initially, these are analyzed individually with regard to their creditworthiness, and standardized group-wide contracts are concluded with customers. The analysis includes external credit ratings, where available, as well as annual financial statements and information from credit agencies and banks. Sales limits are set for each customer and reviewed on an ongoing basis. All sales exceeding these limits require the approval of risk management. Default risks are largely hedged by means of credit insurance and bankable security (guarantees, letters of credit). The default risks and related controls are defined in internal guidelines. Most of the business relationships with dealers and importers have been in place for many years. By continuously monitoring the default risk and the creditworthiness of customers, each receivable is individually reviewed to ascertain the need for a value adjustment.

166

A summary of the default risk on trade receivables as of December 31st 2021 is presented in the following table.

Trade receivables	Not impaired in creditworthiness	Creditworthiness impaired	Total
EURk
Not overdue	129,036	0	129,036
Overdue 1-30 days	15,182	0	15,182
Overdue 31-60 days	1,884	0	1,884
Overdue 61-90 days	1,212	0	1,212
Overdue > 90 days	2,775	4,833	7,608
Total gross carrying amount	150,089	4,833	154,921
Impairment loss	-103	-3,957	-4,060
Total	149,985	876	150,861

A summary of the default risk on trade receivables as of December 31st 2020 is presented in the following table.

Trade receivables	Not impaired in creditworthiness	Creditworthiness impaired	Total
EURk
Not overdue	125,475	0	125,475
Overdue 1-30 days	11,136	0	11,136
Overdue 31-60 days	353	0	353
Overdue 61-90 days	1,010	0	1,010
Overdue > 90 days	4,731	6,358	11,089
Total gross carrying amount	142,705	6,358	149,063
Impairment loss	-135	-4,041	-4,176
Total	142,570	2,317	144,887

In order to determine the need for impairment of trade receivables for which no individual value adjustments have been made, the PIERER Mobility Group evaluated the defaults of recent years. The analysis showed that there is only an insignificant risk for receivables with a certain overdue status. The estimate of loss rates is based on historical default rates in relation to overdue receivables and considering forward-looking information. As regards the current portfolio of trade and other receivables that are neither impaired nor past due, there are no indications as of the closing date that the debtors will not meet their payment obligations. There are no concentration risks.

Estimation of expected credit losses

Based on actual defaults observed in the past, an average default rate in the KTM group of 0.06% (previous year: 0.06%) of trade receivables was determined. A reversal of EUR 5k (previous year: EUR 18k) was recorded. In the E-Bikes segment, an average default rate of 0.13% (previous year: 0.39%) of trade receivables was determined. An addition of EUR 28k (previous year: EUR 55k) was recorded.The impairment for expected losses as of December 31st 2021 in the PIERER Mobility Group amounts to a total of EUR 158k (previous year: EUR 135k).

ANNUAL REPORT 2021

Changes in value adjustments

Changes in value adjustments related to trade receivables are described in the notes under Note 28. “Trade receivables”.

Cash and cash equivalents, other assets and derivatives

Credit losses on cash and cash equivalents are generally calculated using the same method as for debt instruments. Given the short-term nature of these items and the good rating of the banks, the group assumes that these portfolios are financial instruments with a low default risk and that the expected losses are negligible. Likewise, the default risk for other financial assets is to be regarded as extremely low, as the counterparties are debtors of optimum creditworthiness. The other financial instruments presented on the assets side mainly relate to an earmarked loan granted to PIERER Immoreal North America, LLC, a company belonging to a superordinate group of companies. Against this background, the default risk is considered to be low. The default risk on derivative financial instruments with positive market value is limited to their replacement cost; as all the counterparties are banks of good creditworthiness, the default risk can be classified as low. There are no indications of any additional impairment loss requirements for financial assets.

LIQUIDITY RISKS

It is a material objective of financial risk management in the PIERER Mobility Group to ensure solvency and financial flexibility at all times. Factors contributing to liquidity risks include, in particular, proceeds from revenues being below the planning assumptions due to weaker demand. For this purpose, the group maintains a liquidity reserve in the form of unused credit lines (cash credits and guarantee credits) and, if needed, in the form of cash in banks of a high creditworthiness. Top priority is given to ensuring liquidity over the short and medium term. Another major control parameter is the maximization of free cash flow by cost-cutting measures, proactive working capital management and reduced investment expenditure. From today’s perspective, sufficient commitments have been given concerning the creditworthiness of our strategic financing partners and thus the security of current liquidity reserves. Non-current liquidity requirements are met by the issuance of promissory note loans and by taking out bank loans.

EURk	Carrying amount 12/31/2021	Cash flow 2022	Cash flow 2023 to 2026	Cash flow from 2027	Fixed interest	Variable interest	Repayment	Fixed interest	Variable interest	Repayment
Financial liabilities measured at fair value
Fair value - hedging instruments
Other financial liabilities - derivatives with negative market value that have already been assigned to receivables	479	0	0	479	0	0	0	0	0	0
Other financial liabilities - derivatives with negative market value (cash flow hedge)	1,509	0	0	1,509	0	0	0	0	0	0
Total	1,988	0	0	1,988	0	0	0	0	0	0
Financial liabilities not measured at fair value
At amortized cost
Interest-bearing liabilities	497,944	5,292	1,202	34,838	16,330	3,837	282,787	6,312	942	179,134
Lease liabilites	65,442	0	797	19,909	0	1,552	34,784	0	3,319	10,749
Trade payables	395,581	0	0	395,581	0	0	0	0	0	0
Other financial liabilities (current and non-current))	79,175	0	7	78,029	0	11	329	0	0	817
Total	1,038,142	5,292	2,006	528,357	16,330	5,400	317,900	6,312	4,261	190,700
Total	1,040,130	5,292	2,006	530,345	16,330	5,400	317,900	6,312	4,261	190,700

EURk	Carrying amount 12/31/2020	Cash flow 2021	Cash flow 2023 to 2025	Cash flow from 2026	Fixed interest	Variable interest	Repayment	Fixed interest	Variable interest	Repayment
Financial liabilities measured at fair value
Fair value - hedging instruments
Other financial liabilities - derivatives with negative market value (no hedging relationship)	245	91	0	0	302	0	0	0	0	0
Other financial liabilities - derivatives with negative market value that have already been assigned to receivables	748	0	0	748	0	0	0	0	0	0
Other financial liabilities - derivatives with negative market value (cash flow hedge)	2,085	346	0	1,186	1,027	0	0	0	0	0
Total	3,078	437	0	1,934	1,329	0	0	0	0	0
Financial liabilities not measured at fair value
At amortized cost
Interest-bearing liabilities	468,956	4,959	1,066	59,001	16,812	3,698	178,412	4,119	1,037	230,392
Lease liabilites	61,727	0	795	19,491	0	1,559	33,041	0	3,499	9,195
Trade payables	262,099	0	0	262,099	0	0	0	0	0	0
Other financial liabilities (current and non-current)	54,975	0	23	54,125	0	150	850	0	0	0
Total	847,757	4,959	1,884	394,716	16,812	5,407	212,303	4,119	4,536	239,587
Total	850,835	5,396	1,884	396,650	18,141	5,407	212,303	4,119	4,536	239,587

Liabilities that are affected by the supplier finance program are paid on their due date. The associated cash outflows are taken into account in liquidity planning. The supplier finance program results in a concentration of risk. The number of suppliers is replaced by a concentration on a creditor bank. If this creditor bank were to terminate the supplier finance agreement, an additional liquidity risk would generally be incurred, which is not of great significance due to supplier payment goals that are almost identical. As cited in Note 34, this relates to 42.3% of trade payables as of the reporting date. The concentration risk is regarded as low.

41. OTHER RISKS

PROCESS RISKS

There is a risk that standardized processes will not be adhered to, particularly in production. To minimize this risk, these processes are documented in work instructions, process manuals, and handbooks. Employees are trained in the use of this documentation and the documents are freely accessible via various systems.

RISKS DUE TO THE LEGAL FRAMEWORK

As the PIERER Mobility Group markets motorcycles and e-bikes and non-e-bikes in a large number of countries through its equity holdings in the KTM group and PIERER E-Bikes Group, it is exposed to the risk of changes in national regulations, terms of licenses, taxes, trade restrictions, prices, income, and exchange restrictions as well as to the risk of political, social, and economic instability, inflation, and interest rate fluctuations. Motorcycles registered for road use must comply with corresponding provisions concerning noise and exhaust gas emissions in order to be approved for marketing in the respective country. For all new models that are homologated for road use, the KTM group complies with the Euro V European emission standard that is relevant for motorcycles. The possible offroad uses of motorcycles are considerably influenced by the national and legal conditions in the countries where the vehicles are sold. To counteract this risk, the respective regulations specific to the given country are analyzed in detail prior to market launch and continue to be monitored on an ongoing basis in order to be able to react in good time to any changes. The strong focus on research and development ensures that all products of the PIERER Mobility Group will continue to meet regulatory requirements in the future. Fully electric motorcycles already complement the KTM group product range today. At the same time, research and development is also focusing on other alternative drive technologies.

BUSINESS AND ENVIRONMENTAL RISK

Environmental risks may relate to products, production, procurement and non-operating factors. More detailed examinations of environmental risks can also be found in the sustainability report published annually by PIERER Mobility AG and/or the reporting it contains in accordance with the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) on climate-related opportunities and risks. With regard to the products, risks arise in relation to emissions such as noise and pollutants or the leakage of harmful substances such as fuel or oil. In order to minimize these risks that may be caused by potential malfunctions, the homologation requirements are strictly observed in addition to other measures, each vehicle tested for its functionality and compliance with all limit values on our own test benches, and a laboratory is in operation to test the interaction of materials used with people and the environment. In addition, the development of emission-free alternative drive systems and products is becoming an increasingly important focus. With respect to production, environmental risks arise due to the potential leakage of substances, waste and material residues on the premises. Numerous measures are undertaken to prevent these. These include waste management concepts, an engine oil treatment plant, emergency plans for each site and professional extraction systems for metal chips that deposit them in the container provided for this purpose. Emissions from operating the test benches are also caught by extraction systems. Environmental risks in procurement may result from the environment-related shortage and rising prices of resources, cooperation with suppliers that do not operate with sufficient environmental measures, and emissions from delivery routes. In order to minimize these risks, measures are taken that include auditing suppliers, optimizing procurement channels, prioritizing regional procurement, and the use of resource-saving, modern production technology. In addition, environmental risks arise from weather-related and climate-related phenomena, such as floods and other natural disasters.Although it is not possible to completely rule out the risk of natural disasters, the PIERER Mobility Group makes efforts to minimize the risk of production processes being impaired by having suitable emergency plans and insurance policies. For the main factories in Mattighofen and Munderfing, the risk of natural disasters occurring is considered to be low due to their geographical location.

171 ANNUAL REPORT 2021

PERSONNEL-RELATED RISKS

Especially with regard to the growth course, risks may arise if key staff leave the company. Efficient personnel management as well as the constant pursuit of personnel development programs are designed to counteract the risk of managerial staff leaving the company. The turnover rate is just 2.06% for managers of KTM AG incl. subsidiaries in Austria. The risk of a shortage of skilled staff is minimized by a comprehensive apprentice training program in our own apprentice workshop. As of December 31st 2021, a total of 184 apprentices (including six foundation apprentices) were in training at KTM AG. Since 1995, around 600 apprentices have started an apprenticeship; 73% of them still work in the company. The aim is to recruit employees from the region and to retain them in the long term. The company has taken numerous measures to protect its employees since the outbreak of the coronavirus pandemic in Austria. These measures comprise maintaining a dedicated COVID team, a COVID hotline and contact tracing within the company. The hygiene and safety guidelines issued at the beginning of the pandemic will continue to be enforced at the workplace and adapted to the current circumstances. The opportunities for working from home and the team splitting measures that have been rolled out since 2020 will continue. Following the end of the seasonal interruptions to operations in January and August 2021, mass tests and 3G checks were carried out before production restarted. Antigen rapid throat swab tests were carried out all year round on the KTM Covid test line in order to respond to suspected cases in a quick and uncomplicated manner or to ensure that those returning from quarantine had recovered and before resuming work. In total, over 7,900 rapid tests were conducted by specially trained personnel. At the end of the year, planning for the expansion of the test line to provide in-house PCR tests began in order to ensure a high level of safety even in case of further virus mutations. In addition, from spring onwards the measures were expanded to include company vaccinations: In total, two major operational vaccination campaigns were organized in May/June (first and second vaccinations) and December (mostly third vaccinations). In addition, vaccinations were on offer on a weekly basis from June to November, and there were also two vaccination bus campaigns in order to offer employees and also in some cases their family members easy access to immunization options. Government measures and regulations were implemented comprehensively and quickly and, due to the forward-looking approach and constant exchange with the authorities, various measures were integrated into the day-to-day business even before they were legally required. It was therefore possible to prevent large-scale spread within the company. The risk of being infected with COVID-19 in the company if the guidelines are adhered to is considered to be low.

VIII. FINANCIAL INSTRUMENTS AND CAPITAL MANAGEMENT

42. BASIC PRINCIPLES

The PIERER Mobility Group holds primary and derivative financial instruments. Primary financial instruments mainly include trade receivables, credit balances with credit institutions, liabilities owed to credit institutions, trade payables, and financial liabilities. The portfolio of primary financial instruments is shown in the consolidated statement of financial position and described in the notes to the consolidated financial statements. Derivative financial instruments are generally used to hedge existing risks relating to interest rate changes and foreign currency. The use of derivative financial instruments is subject to appropriate authorization and control procedures in the group. The link to a hedged item is mandatory; trading transactions are not permitted. Purchases and sales of all financial instruments are recognized as at the settlement date. As a matter of principle, financial instruments are measured at cost of acquisition upon initial recognition. The financial instruments are derecognized if the rights to payments from the investment have expired or have been transferred and the group has essentially transferred all the risks and opportunities associated with their ownership.

172 ACCOUNTING POLICIES:

Categorization will take place in accordance with the contractual cash flows and the business models on which they are based. In this regard, the following measurement categories are provided by IFRS 9:

AC category: At amortized cost using the effective interest method
FVOCI category: At fair value, changes to the fair value are recorded under other comprehensive income
FVPL category: At fair value, changes to the fair value are recorded in the income statement

In the case of equity instruments (such as shares in companies not listed on the stock exchange), the FVOCI option can be exercised. This will lead to changes in the fair value being recorded under other comprehensive income, meaning that it will no longer be possible to regroup the changes to fair value accumulated under other comprehensive income in the income statement. Insofar as this option is not exercised, these will be assigned to the FVPL category, under which all changes to the fair value will be recorded in the income statement. Receivables and other assets upon initial recognition are measured at fair value and in subsequent periods are measured at amortized cost of acquisition. Foreign currency receivables are translated at the exchange rate on the reporting date, less any impairment charges required on account of identifiable risks. Financial receivables are classified as “at amortized cost” and are measured at amortized cost. That portion of trade receivables that is part of the ABS or factoring program is allocated to the category “Fair Value through Profit and Loss” (FVPL). Financial liabilities are measured at amortized cost of acquisition. Financial liabilities are assigned to the “at amortized cost” category. Any difference between the amount received and the amount repayable is apportioned over the term to maturity using the effective interest method and recognized in financial income and expenses. Issuing costs incurred in connection with bonds are recognized as an expense over the term to maturity. Liabilities are measured at amortized cost. Liabilities denominated in foreign currencies are translated at the closing rate. All financial instruments in the FVPL category are measured at fair value through profit or loss on the basis of the criteria in IFRS 9 (business model or SPPI test). The fair value option was not exercised.

Impairment losses

Trade receivables do not exhibit any significant financing components. For that reason, the simplified process for establishing the expected credit loss is used; this involves accounting for all instruments with a risk provision, which is independent of their credit quality, in the amount of the expected losses over the term to maturity. This amounts to less than twelve months for trade receivables and therefore corresponds to the 12-month loss. For details of the amounts involved, please refer to Note 40. “Financial risks”. In order to determine the expected credit loss, historical default data were collected for receivables over the last eight to ten years and split into geographic regions. Current economic factors and forecasts are also taken into account. Individual valuation adjustments are made to financial assets if they are deemed to be uncollectible or partially uncollectible. Signs that an individual allowance is required are financial difficulties, insolvency, breach of contract or considerable delay in payment on the part of the customer. Individual value adjustments consist of numerous individual items, none of which is material when considered in isolation. Financial assets are only derecognized directly if the contractual rights to receive payment cease to exist (in particular in the case of insolvency). If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss is reversed by adjusting the allowance account.

Hedge accounting

The regulations on hedge accounting are applied in accordance with IFRS 9. According to IFRS 9, the fair value of an option, the forward element of a forward contract and any foreign currency basis spreads can be excluded from the designation of a financial instrument as a hedging instrument and accounted for as the cost of hedging. In this regard, fluctuations in the value of these components that have optionally not been designated are recorded as hedging costs under other comprehensive income and reclassified in the income statement in the event that the hedged item is recognized in profit or loss.

173 ANNUAL REPORT 2021

43. CLASSIFICATION AND FAIR VALUE

The fair value of a financial instrument is determined by means of quoted market prices for identical instruments in active markets (Level 1). If no quoted market prices in active markets are available for the instrument, the fair value is determined by means of valuation techniques for which the material inputs are based exclusively on observable market data (Level 2). In all other cases, the fair value is determined on the basis of valuation techniques for which at least one material input is not based on observable market data (Level 3).Reclassifications from one level to another are taken into account at the end of the reporting period. There were no transfers between levels in the financial year. The table below shows the valuation techniques used to determine fair value as well as the significant unobservable input factors used.

174

Receivables sold in connection with the current ABS and factoring program are fully derecognized in accordance with the rules under IFRS 9. Under the ABS program, trade receivables insured on a revolving monthly basis are sold up to a maximum volume of EUR 250,000k (previous year: EUR 250,000k). As at the reporting date, trade receivables of EUR 166,358k (previous year: EUR 127,399k) had been sold to third parties. Up to a contractually defined amount, the PIERER Mobility Group continues to bear a risk from credit risk related defaults. As at December 31st 2021, the maximum ensuing risk of loss was EUR 1,158k (previous year: EUR 994k). The expected loss is recorded as a liability and expensed at the time of sale. As of December 31st 2021, the carrying amount of the ongoing commitment was EUR 1,158k (previous year: EUR 994k). It is listed under other current liabilities. The carrying amount represents the fair value of the ongoing commitment. In the reporting period, income from the ongoing commitment of EUR 164k (previous year: EUR 42k) and accumulated expenses since the start of the transaction of EUR 1,158k (previous year: EUR 994k) was recorded.

Under the factoring program, trade receivables insured on a revolving monthly basis are sold up to a maximum volume of EUR 65,000k (previous year: EUR 15,000k). As at the reporting date, trade receivables of EUR 32,923k (previous year: EUR 11,720k) had been sold to third parties. Up to a contractually defined amount, the group continues to bear a risk from credit risk related defaults. As at December 31st 2021, the maximum ensuing risk of loss was EUR 2,163k (previous year: EUR 0k).

The following table shows the carrying amounts and fair values of the financial assets (financial instruments shown on the assets side), broken down by class or measurement category according to IFRS 9. However, it does not provide information on the fair value or level of financial assets and financial liabilities not measured at fair value where the carrying amount is a reasonable approximation of fair value.

EURk
| Classification under IFRS 9 | Fair value 12/31/2021 | Level 1 | Level 2 | Level 3 | Total | Carrying amount 12/31/2021 |
| :----------------------------------------------------- | :-------------------- | :------ | :------ | :------ | :---- | :------------------------- |
| Financial assets measured at fair value | | | | | | |
| Other current assets - derivatives with positive market value (cash flow hedge) | 3,411 | - | 3,411 | - | 3,411 | 3,411 |
| Trade receivables | 4,615 | - | - | 4,615 | 4,615 | 4,615 |
| Other financial assets | 1,410 | - | 216 | 1,194 | 1,410 | 1,410 |
| Total | 9,436 | - | 3,627 | 5,809 | 9,436 | 9,436 |
| | | | | | | |
| Financial assets not measured at fair value | | | | | | |
| Cash and cash equivalents | - | - | - | - | - | 373,509 |
| Trade receivables | - | - | - | - | - | 146,247 |
| Other financial assets | - | - | - | - | - | 51,020 |
| Total | - | - | - | - | - | 570,776 |
| | | | | | | |
| Total | 9,436 | - | 3,627 | 5,809 | 9,436 | 580,212 |

EURk
| Classification under IFRS 9 | Fair value 12/31/2020 | Level 1 | Level 2 | Level 3 | Total | Carrying amount 12/31/2020 |
| :----------------------------------------------------- | :-------------------- | :------ | :------ | :------ | :---- | :------------------------- |
| Financial assets measured at fair value | | | | | | |
| Other current assets - derivatives with positive market value that have already been assigned to receivables | 1,663 | - | 1,663 | - | 1,663 | 1,663 |
| Other current assets - derivatives with positive market value (cash flow hedge) | 532 | - | 532 | - | 532 | 532 |
| Trade receivables | 17,051 | - | - | 17,051 | 17,051 | 17,051 |
| Other financial assets | 1,410 | - | 216 | 1,194 | 1,410 | 1,410 |
| Total | 20,656 | - | 2,411 | 18,245 | 20,656 | 20,656 |
| | | | | | | |
| Financial assets not measured at fair value | | | | | | |
| Cash and cash equivalents | - | - | - | - | - | 218,270 |
| Trade receivables | - | - | - | - | - | 127,836 |
| Other financial assets | - | - | - | - | - | 37,718 |
| Total | - | - | - | - | - | 383,824 |
| | | | | | | |
| Total | 20,656 | - | 2,411 | 18,245 | 20,656 | 404,480 |

175

ANNUAL REPORT 2021

176

The following table shows the carrying amounts and fair values of the financial liabilities (financial instruments shown on the liabilities side), broken down by class or measurement category according to IFRS 9. However, it does not provide information on the fair value or level of financial liabilities not measured at fair value where the carrying amount is a reasonable approximation of fair value.

EURk
| Classification under IFRS 9 | Fair value 12/31/2021 | Level 1 | Level 2 | Level 3 | Total | Carrying amount 12/31/2021 |
| :----------------------------------------------------- | :-------------------- | :------ | :------ | :------ | :---- | :------------------------- |
| Financial liabilities measured at fair value | | | | | | |
| Fair value - hedging instruments | | | | | | |
| Other financial liabilities - derivatives with negative market value that have already been assigned to receivables | 479 | - | 479 | - | 479 | 479 |
| Other financial liabilities - derivatives with negative market value (cash flow hedge) | 1,509 | - | 1,509 | - | 1,509 | 1,509 |
| Total | 1,988 | - | 1,988 | - | 1,988 | 1,988 |
| | | | | | | |
| Financial liabilities not measured at fair value | | | | | | |
| At amortized cost | | | | | | |
| Interest-bearing liabilities | | | | | | 497,944 |
| Lease liabilities | | | | | | 65,442 |
| Trade payables | | | | | | 395,581 |
| Other financial liabilities (current and non-current) | | | | | | 79,175 |
| Total | - | - | - | - | - | 1,038,142 |
| | | | | | | |
| Total | 1,988 | - | 1,988 | - | 1,988 | 1,040,130 |

ANNUAL REPORT 2021

EURk
| | Fair value 12/31/2021 | Carrying amount 12/31/2021 | Classification under IFRS 9 | Level 1 | Level 2 | Level 3 | Total | AC Amortised Cost | FVOCI Fair Value through OCI | FVOCI Fair Value through OCI (without recycling) | FVPL Fair Value through P&L | Fair Value - hedging instruments |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Financial liabilities measured at fair value | | | | | | | | | | | | |
| Fair value - hedging instruments | | | | | | | | | | | | |
| Other financial liabilities - derivatives with negative market value (no hedging relationship) | 245 | 245 | FVPL | - | 245 | - | 245 | | | | | |
| Other financial liabilities - derivatives with negative market value that have already been assigned to receivables | 748 | 748 | FVPL | - | 748 | - | 748 | | | | | |
| Other financial liabilities - derivatives with negative market value (cash flow hedge) | 2,085 | 2,085 | FVOCI | - | 2,085 | - | 2,085 | | | | | |
| Total | 3,078 | | | | | | | | | | | |
| Financial liabilities not measured at fair value | | | | | | | | | | | | |
| At amortized cost | | | | | | | | | | | | |
| Interest-bearing liabilities | 468,956 | 495,649 | AC | - | - | 495,649 | 495,649 | 468,956 | | | | |
| Lease liabilities | 61,727 | | AC | - | - | - | - | 61,727 | | | | |
| Trade payables | 262,099 | | AC | - | - | - | - | 262,099 | | | | |
| Other financial liabilities (current and non-current) | 54,975 | | AC | - | - | - | - | 54,975 | | | | |
| Total | 847,757 | | | | | | | | | | | |
| Total | 850,835 | | | | | | | | | | | |

EURk
| | Fair value 12/31/2021 | Carrying amount 12/31/2021 | Classification under IFRS 9 | Level 1 | Level 2 | Level 3 | Total | AC Amortised Cost | FVOCI Fair Value through OCI | FVOCI Fair Value through OCI (without recycling) | FVPL Fair Value through P&L | Fair Value - hedging instruments |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Financial liabilities measured at fair value | | | | | | | | | | | | |
| Fair value - hedging instruments | | | | | | | | | | | | |
| Other financial liabilities - derivatives with negative market value that have already been assigned to receivables | 479 | 479 | FVPL | - | 479 | - | 479 | | | | | |
| Other financial liabilities - derivatives with negative market value (cash flow hedge) | 1,509 | 1,509 | FVOCI | - | 1,509 | - | 1,509 | | | | | |
| Total | 1,988 | | | | | | | | | | | |
| Financial liabilities not measured at fair value | | | | | | | | | | | | |
| At amortized cost | | | | | | | | | | | | |
| Interest-bearing liabilities | 497,944 | 519,425 | AC | - | - | 519,425 | 519,425 | 497,944 | | | | |
| Lease liabilities | 65,442 | | AC | - | - | - | - | 65,442 | | | | |
| Trade payables | 395,581 | | AC | - | - | - | - | 395,581 | | | | |
| Other financial liabilities (current and non-current) | 79,175 | | AC | - | - | - | - | 79,175 | | | | |
| Total | 1,038,142 | | | | | | | | | | | |
| Total | 1,040,130 | | | | | | | | | | | |

EURk
| | Fair value 12/31/2020 | Carrying amount 12/31/2020 | Classification under IFRS 9 | Level 1 | Level 2 | Level 3 | Total | AC Amortised Cost | FVOCI Fair Value through OCI | FVOCI Fair Value through OCI (without recycling) | FVPL Fair Value through P&L | Fair Value - hedging instruments |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Financial liabilities measured at fair value | | | | | | | | | | | | |
| Fair value - hedging instruments | | | | | | | | | | | | |
| Other financial liabilities - derivatives with negative market value (no hedging relationship) | 245 | 245 | FVPL | - | 245 | - | 245 | | | | | |
| Other financial liabilities - derivatives with negative market value that have already been assigned to receivables | 748 | 748 | FVPL | - | 748 | - | 748 | | | | | |
| Other financial liabilities - derivatives with negative market value (cash flow hedge) | 2,085 | 2,085 | FVOCI | - | 2,085 | - | 2,085 | | | | | |
| Total | 3,078 | | | | | | | | | | | |
| Financial liabilities not measured at fair value | | | | | | | | | | | | |
| At amortized cost | | | | | | | | | | | | |
| Interest-bearing liabilities | 468,956 | 495,649 | AC | - | - | 495,649 | 495,649 | 468,956 | | | | |
| Lease liabilities | 61,727 | | AC | - | - | - | - | 61,727 | | | | |
| Trade payables | 262,099 | | AC | - | - | - | - | 262,099 | | | | |
| Other financial liabilities (current and non-current) | 54,975 | | AC | - | - | - | - | 54,975 | | | | |
| Total | 847,757 | | | | | | | | | | | |
| Total | 850,835 | | | | | | | | | | | |

178

The net profit or loss from the financial instruments by IFRS 9 measurement category includes net gains/losses, total interest income/expenses and impairment losses and is made up as follows:

2021

	From Interest income	From subsequent measurement to fair value	From allowance	From disposal	From foreign exchange valuation	Net income (total)
EURk
Financial assets - amortized cost (AC)	1,865	0	-122	0	8,484	10,227
Fair Value through OCI (FVOCI) - equity instruments	0	0	0	0	0	0
Fair Value through PL (FVPL) - equity instruments	0	365	0	0	0	365
Other financial liabilities - amortized cost (AC)	-12,487	0	0	0	0	-12,487
Total	-10,622	365	-122	0	8,484	-1,895

2020

	From Interest income	From subsequent measurement to fair value	From allowance	From disposal	From foreign exchange valuation	Net income (total)
EURk
Financial assets - amortized cost (AC)	1,629	0	-1,087	-494	-2,158	-2,110
Fair Value through OCI (FVOCI) - equity instruments	0	-2	0	0	0	-2
Fair Value through PL (FVPL) - equity instruments	0	-262	0	0	0	-262
Other financial liabilities - amortized cost (AC)	-14,555	0	0	0	0	-14,555
Total	-12,926	-264	-1,087	-494	-2,158	-16,929

Changes in allowances and the derecognition of financial assets (amortized cost) are disclosed in other operating expenses for the relevant overhead areas. The remaining components of the net result are included in financial income and financial expenses, respectively.

44. SET-OFF OF FINANCIAL ASSETS AND LIABILITIES

The group enters into set-off agreements with banks in connection with derivatives. Generally, the amounts owed under such agreements by each counterparty on a given day for all outstanding transactions in the same currency are aggregated into a single net amount payable by one party to the other. In certain cases – e.g. when a credit event such as a default occurs – all outstanding transactions under the agreement are terminated, their value as of termination is determined, and only a single net amount is payable for settling all transactions. These items are not set off in the balance sheet, as such, as the net set-off of multiple transactions under the same framework agreements does not generally occur. The tables below show financial assets and liabilities that have actually been offset along with amounts that are subject to a set-off agreement but which have not been offset, as they do not fulfill the criteria for set-off prescribed under IFRS.

179

ANNUAL REPORT 2021

EURk
| | Financial assets (gross) | Offset balance items (gross) | Accounted financial assets (net) | Effect of general offsetting agreements | Net amounts |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Financial assets 2021 | | | | | |
| Other financial assets - Derivatives with positive market value that have already been assigned to receivables | | | | | |
| Forward currency transactions | 385 | 0 | 385 | -341 | 44 |
| Interest rate swaps | 3,026 | 0 | 3,026 | 0 | 3,026 |
| Total | 3,411 | 0 | 3,411 | -341 | 3,070 |
| Financial assets 2020 | | | | | |
| Other financial assets - Derivatives with positive market value that have already been assigned to receivables | | | | | |
| Forward currency transactions | 2,195 | 0 | 2,195 | -85 | 2,110 |
| Total | 2,195 | 0 | 2,195 | -85 | 2,110 |

EURk
| | Financial assets (gross) | Offset balance items (gross) | Accounted financial assets (net) | Effect of general offsetting agreements | Net amounts |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Financial liabilities 2021 | | | | | |
| Other financial liabilities - Derivatives with negative market value that have already been assigned to receivables | | | | | |
| Forward currency transactions | 1,940 | 0 | 1,940 | -341 | 1,599 |
| Interest rate swaps | 48 | 0 | 48 | 0 | 48 |
| Total | 1,988 | 0 | 1,988 | -341 | 1,647 |
| Financial liabilities 2020 | | | | | |
| Other financial liabilities - Derivatives with negative market value that have already been assigned to receivables | | | | | |
| Forward currency transactions | 1,933 | 0 | 1,933 | -85 | 1,849 |
| Interest rate swaps | 1,145 | 0 | 1,145 | 0 | 1,145 |
| Total | 3,078 | 0 | 3,078 | -85 | 2,994 |

180 45. HEDGES

The group enters into derivative financial instruments (foreign currency forwards and interest rate swaps) to hedge foreign currency and interest rate risk. The aim of using derivative financial instruments is to offset fluctuations in cash flows from future transactions. Expected revenues in foreign currencies serve as the basis for planning future cash flows. The group only recognizes changes in the spot rate component of forward currency transactions as a hedging instrument in cash flow hedges. The change in the forward component is accounted for separately as a cost of hedging and transferred to a reserve for hedging costs in equity or reclassified in the income statement if the hedged item affects profit or loss (as part of the financial result). Derivatives are generally measured at fair value in accordance with IFRS 9. The KTM group applies the rules for cash flow hedge accounting defined by IFRS 9 to these derivative financial instruments. However, the main contractual criteria of the hedged item and the hedging instrument are identical but oppositely structured (“critical terms match”), ensuring an economic context for the hedging relationship. As of December 31st 2021 (as in the previous year as well), there were no derivative financial instruments for which no hedging relationships could be established. A cash flow hedge is present if variable cash flows from recognized assets and/or liabilities or forecast business transactions that are subject to a market price risk are being hedged. If the requirements for a cash flow hedge are met, the effective portion of the change in the market value of hedging instruments must be recognized directly in consolidated equity. However, it is not recognized in profit or loss until the hedged transaction occurs. Where foreign currency hedges are used, subsequent changes in the market value of the derivatives are recognized in profit or loss. From that date, the change in the market value can be compared to the end-of-period closing rate of the foreign currency trade payables or foreign currency trade receivables.## 45. Financial Instruments

Any changes in earnings that are caused by the ineffectiveness of derivative financial instruments are recognized in profit or loss in the consolidated income statement. To measure the effectiveness of a currency hedge, the hedged items and the hedging transactions are grouped together in so-called maturity bands according to the hedged risk. The maturity bands should not cover more than one quarter-year. The prospective effectiveness is assessed at the inception of the hedging relationship and reviewed at each measurement date as well as in the event of a significant change in the circumstances that affect the criteria for assessing effectiveness. In the case of interest rate hedges, prospective effectiveness is measured using a sensitivity analysis and retrospective effectiveness testing is performed using the dollar offset approach. Derivatives are measured at fair value. The fair value is the market value and is determined using accepted methods of financial mathematics. The basis for measuring the derivatives is the market data (interest rate, exchange rates, etc.) prevailing on the reporting date. The forward rate applicable on the reporting date is used for measuring forward currency transactions. In the case of positive market values, the credit rating of the counterparty is included in the measurement by means of a credit value adjustment (CVA). In the case of negative market values, a debit value adjustment (DVA) is deducted in order to account for the group‘s own risk of default. Special models are used to estimate the measurement. They are checked for plausibility by means of bank valuations.

181 ANNUAL REPORT 2021

The following derivative financial instruments used as hedging instruments were employed as of December 31st 2021 and December 31st 2020, respectively:

12/31/2021

Currency	Notional amount in 1000 local currency	Market values in EURk	Exposures in EURk	Term up to 1 year	Average foreign exchange rate	Term 1 - 5 years	Average foreign exchange rate
Forward currency transactions
USD	60,000	-787	46,156	60,000	0.77	-	-
JPY	600,000	30	-35,946	600,000	65.79	-	-
CAD	49,000	116	68,080	49,000	-	-	-
GBP	38,000	-411	88,909	38,000	0.85	-	-
CHF	19,744	-133	36,270	19,744	1.04	-	-
AUD	51,000	-418	83,157	51,000	1.58	-	-
NZD	14,000	48	15,975	14,000	1.67	-	-

	Notional amount in 1000 local currency	Market values in EURk	Exposures in EURk	Term up to 1 year	Average interest rate	Term 1 - 5 years	Average interest rate
Interest rate swaps	166,144	2,979	0	893	2.11%	165,221	0.25%

12/31/2020

Currency	Notional amount in 1000 local currency	Market values in EURk	Exposures in EURk	Term up to 1 year	Average foreign exchange rate	Term 1 - 5 years	Average foreign exchange rate
Forward currency transactions
USD	20,000	1,999	117,755	20,000	1.09	-	-
JPY	4,266,000	-840	-7,354	4,266,000	123.47	-	-
CAD	0	0	40,884	0	-	-	-
GBP	17,000	168	78,226	17,000	0.89	-	-
CHF	8,200	25	22,224	8,200	1.08	-	-
AUD	50,000	-745	95,173	50,000	1.63	-	-
NZD	8,000	-60	12,248	8,000	1.73	-	-
PLN	0	0	15,155	0	-	-	-
ZAR	0	0	12,912	0	-	-	-
CNY	0	0	-5,743	0	-	-	-

	Notional amount in 1000 local currency	Market values in EURk	Exposures in EURk	Term up to 1 year	Average interest rate	Term 1 - 5 years	Average interest rate
Interest rate swaps	108,167	-1,145	0	893	2.11%	107,275	0.39%

182

In cash flow hedge accounting, both variable future cash flows arising from non-current liabilities with maturity dates up to 2024 or up to 2026 and future operating cash flows (receipts as well as payments) planned for the next twelve months are hedged. At the reporting date, the amounts relating to items designated as hedged items were as follows.

EURk

Cash flow hedge reserve	Costs of hedging hedge reserve	Balances remaining in the cash flow hedge reserve from hedging relationships for which hedge accounting is no longer applied
12/31/2021
Foreign currency risk
Sales and receivables	-1,242	486
---	---	---
Non-current financial liabilities	506,539	456,089
Current financial liabilities	56,847	74,594
563,386	530,683
Cash and cash equivalents	-373,509	-218,270
Net financial debt	189,877	312,413

The key figures of “gearing” (ratio of net debt to equity) and “dynamic debt level” (ratio of net financial debt to EBITDA) for monitoring the capital are as follows:

EURk | 12/31/2021 | 12/31/2020
---|---|---|
Equity | 765,551 | 654,119
Net financial debt | 189,877 | 312,413
Gearing | 24.8% | 47.8%

EURk | 12/31/2021 | 12/31/2020
---|---|---|
Net financial debt | 189,877 | 312,413
EBITDA | 332,202 | 233,530
Dynamic debt level | 0.6 | 1.3

IX. LEASES

47. LEASES AS LESSEE (IFRS 16)

The PIERER Mobility Group has concluded rental and lease agreements for the use of land, operating and administrative buildings, or office space and storage areas, machines (including CNC machines) and in respect of the vehicle fleet. The PIERER Mobility Group also leases IT equipment with contractual terms of between one and five years. These rental and lease agreements are short-term and/or for items of low value. The group has exercised the option under IFRS 16.5-.8 and has not recognized any rights of use or leasing liabilities for these rental and lease agreements.

Since the 2016 financial year, leasing contracts have been concluded for tools (special leasing) and machines with terms of 3-10 years.

Rights of use and leasing liabilities

The carrying value of the rights of use is as follows:

EURk | Land and buildings | Technical plant and machinery | Fixtures and fitting, tools and equipment (incl. Motor vehicles) | TOTAL
---|---|---|---|---|
2021 | | | |
As of 1/1 | 29,991 | 16,180 | 13,891 | 60,062
- Depreciation and amortization | -8,399 | -5,429 | -6,480 | -20,308
+ Additions right-of-use assets | 8,975 | 6,792 | 8,859 | 24,626
- Disposals right-of-use assets | -1,419 | 0 | -285 | -1,704
+/- Currency effects, reclassifications | 121 | -16 | 105 | 210
Carrying amount as of 12/31/2021 | 29,269 | 17,527 | 16,090 | 62,886

2020 | | | |
As of 1/1 | 28,073 | 15,803 | 16,303 | 60,180
- Depreciation and amortization | -6,898 | -5,668 | -6,188 | -18,754
+ Additions right-of-use assets | 8,905 | 6,162 | 4,417 | 19,484
- Disposals right-of-use assets | -45 | -115 | -547 | -707
+/- Currency effects, reclassifications | -44 | -2 | -94 | -140
Carrying amount as of 12/31/2020 | 29,991 | 16,180 | 13,891 | 60,062

The cash value of the minimum lease payments is as follows:

EURk | Future minimum lease payments | Interest payments | Present value of future minimum lease payments
---|---|---|---|
2021 | | | |
Up to 1 year | 20,706 | 797 | 19,909
Longer than 1 year and up to 5 years | 36,336 | 1,552 | 34,783
Over 5 years | 14,069 | 3,319 | 10,750
TOTAL | 71,111 | 5,668 | 65,442

2020 | | | |
Up to 1 year | 20,285 | 794 | 19,491
Longer than 1 year and up to 5 years | 34,601 | 1,558 | 33,042
Over 5 years | 12,693 | 3,499 | 9,194
TOTAL | 67,579 | 5,851 | 61,727

Payment obligations under leases are disclosed in the consolidated statement of financial position under financial liabilities, see Note 32.

187
ANNUAL REPORT 2021

Amounts recognized in the income statement and statement of cash flows

2021 - Leases according to IFRS 16

EURk |
---|---|
Interest expenses on lease liabilities | 895
Income from sublease of right-of-use assets | 208
Expenses relating to short-term leases | 3,787
Expenses relating to leases of low-value assets, excluding short-term leases of low-value assets | 9,482

2020 - Leases according to IFRS 16

EURk |
---|---|
Interest expenses on lease liabilities | 968
Income from sublease of right-of-use assets | 213
Expenses relating to short-term leases | 3,802
Expenses relating to leases of low-value assets, excluding short-term leases of low-value assets | 9,426

The expenses for leases for low-value assets relate to rental and lease agreements for IT equipment. The statement of cash flows recorded cash outflows for leases in the amount of EUR 32,387k (previous year: EUR 32,804k), of which EUR 18,431k (previous year: EUR 18,821k) are for the repayment of lease liabilities and EUR 13,956k (previous year: EUR 13,983k) are for short-term and lower-value leases as well as interest expenses and income from subleases of rights of use.

Options for prolongation

Some rental and lease agreements contain options for prolongation, which can be exercised by the group up to one year before the end of the fixed term. Wherever possible, the group seeks to include options for prolongation when concluding new rental contracts and leases in order to ensure operational flexibility. On the date of provision, the group assesses whether the right to exercise options for prolongation is sufficiently certain. The group reassesses whether it is reasonably certain that an option for prolongation will be exercised if a material event or change in circumstances occurs that is within its control.

48. LEASES AS LESSOR (IFRS 16)

From the lessor‘s perspective, all leases are classified as operating leases, as they are structured in such a way that the PIERER Mobility Group essentially retains all the risks and opportunities associated with ownership. This does not include three subleases, which the group has classified as finance leases. These relate to the sublease of buildings, which were reported as rights of use under property, plant and equipment. One of these three subleases was newly concluded and accounted for in the 2021 financial year. In addition, the group recorded interest income on leasing receivables in 2021 in the amount of EUR 8k (previous year: EUR 10k). The leasing receivables from subleases amounted to EUR 850k as of December 31st 2021 (previous year: EUR 590k). Of these, EUR 327k (previous year: EUR 293k) is due in less than one year and EUR 523k (previous year: EUR 297k) in 1-5 years.

188
X. EXPLANATIONS REGARDING RELATED PARTIES AND THE CORPORATE BODIES

49. RELATED PARTY DISCLOSURES

According to the provisions of IAS 24, details of related party transactions are to be provided. On the reporting date of December 31st 2021, 73.32% of the shares of PIERER Mobility AG were held by PIERER BAJAJ AG (formerly: PTW Holding AG), which is 50.10% owned by Pierer Industrie AG. Furthermore, Pierer Konzerngesellschaft mbH holds 2.58% of the shares in PIERER Mobility AG. Pierer Industrie AG is 100.00% owned by Pierer Konzerngesellschaft mbH. The sole shareholder of Pierer Konzerngesellschaft mbH is Stefan Pierer. Stefan Pierer held the following key positions in the Pierer Konzerngesellschaft mbH Group as at December 31st 2021:

Chairman of the Executive Board of Pierer Industrie AG, Wels
Chairman of the Executive Board of Pierer Bajaj AG, Wels
Chairman of the Executive Board of PIERER Mobility AG, Wels
Chairman of the Executive Board of KTM AG, Mattighofen
Chairman of the Supervisory Board of Pankl AG, Kapfenberg
Chairman of the Supervisory Board of Pankl Racing Systems AG, Kapfenberg
Member of the Supervisory Board of SHW AG, Aalen, Germany
Chairman of the Supervisory Board of WESTPARK WELS AG, Wels

In the PIERER Mobility Group, transactions with related parties are grouped according to “shareholder-related companies”, “associates” and “other companies”. PIERER Mobility AG is part of the same group as Pierer Konzerngesellschaft mbH, the ultimate parent company of the group, and its subsidiaries and is included within the consolidated financial statements of that group. All the companies included within the consolidated financial statements of Pierer Konzerngesellschaft mbH and controlled by Pierer Konzerngesellschaft mbH are shown as related companies in the “shareholder-related companies” category. Associates can be seen from the schedule of equity holdings (see Chapter XII) and concern all investments accounted for using the equity method. Other companies are defined as all companies controlled by key management. PIERER Mobility AG principally defines key management as members of the Executive Board and Supervisory Board and, where appropriate, further managers in key positions who may exert a significant influence on the finance and business policy decisions of the group. In addition, family members of key management and their companies are also taken into account. In the 2021 financial year and in the previous year, there were no material transactions with related parties (apart from Executive Board and Supervisory Board earnings, see Note 51.). The business transactions with related companies are represented as follows according to the grouping described:

All transactions with related companies were carried out at arm’s length. Material business relationships are disclosed below:

EURk	Shareholder related companies	Associated companies	Other companies
	12/31/2021	12/31/2020	12/31/2021
Receivables	32,013	11,544	11,494
Liabilities	-12,890	-10,390	-2,752
Revenues	2,551	822	35,291
Expenses	-118,548	-48,915	-32,365
Dividend	-7,372	0	0

189
ANNUAL REPORT 2021

SHAREHOLDER-RELATED COMPANIES:

Since the investment in 2014, PIERER Mobility AG has been a group member of Pierer Konzerngesellschaft mbH, Wels, in accordance with Section 9 of the Austrian Corporate Tax Act (KStG). KTM AG has been a member of this tax group within the meaning of the Austrian Corporate Tax Act since 2017. The taxable incomes of the group members are allocated to the group parent. The tax compensation between the group parent and each individual group member was regulated by a group taxation and tax transfer agreement. Tax losses are reserved at the level of the respective subsidiaries and can be offset at this level against future tax profits. In the 2021 financial year, expenses totaling EUR 33,078k were incurred with Pierer Konzerngesellschaft mbH (previous year: EUR 6,925k) and earnings amounting to EUR 2k were incurred (previous year: EUR 822k). Furthermore, as at the reporting date, there were outstanding liabilities amounting to EUR 8,233k (previous year: EUR 2,920k) and receivables of EUR 257k (previous year: EUR 1k). Since October 1st 2018, Pierer Industrie AG has formed a tax group for VAT purposes with the PIERER Mobility Group.As of the reporting date, the PIERER Mobility Group had receivables totaling EUR 8,933k (previous year: EUR 5,783k), in particular from the tax group settlement with Pierer Industrie AG. In the 2021 financial year, Pierer Bajaj AG received dividends in the amount of EUR 6,762k, Pierer Konzerngesellschaft mbH received dividends in the amount of EUR 483k and Pierer Industrie AG received dividends in the amount of EUR 128k from PIERER Mobility AG from the previous financial year. In the previous year, no dividend was distributed to shareholders by PIERER Mobility AG. As of December 31st 2021, KTM North America, Inc., USA had outstanding receivables from PIERER Immoreal North America, LLC., USA, from various recharges of EUR 3,076k (previous year: EUR 679k). In addition, the company was granted a credit facility by KTM AG of USD 40,000k for the construction of office and operating buildings in North America. As of December 31st 2021, EUR 14,449k of this had been utilized. Other transactions with shareholder-related companies on the expenses side mainly concern the Pankl Racing Group, which acts as a supplier of purchased parts for the KTM group. The Pankl Racing Group is part of the Pierer Industrie Group and is controlled via Pankl AG.

ASSOCIATES:

Expenses of EUR 14,210k were incurred for services provided by Kiska GmbH during the financial year (previous year: EUR 12,760k). As of December 31st 2021, accounts payable to Kiska GmbH were EUR 2,572k (previous year: EUR 1,015k). Other expenses relate to transactions with KTM Asia Motorcycle Manufacturing Inc. of the Philippines. Receivables and income from associates largely relate to transactions with KTM Asia Motorcycle Manufacturing Inc. and Zhejiang CFMOTO-KTMR2R Motorcycles Co.

OTHER COMPANIES:

Cooperation with the Indian Bajaj group has been in place since 2007. The Bajaj group is India’s second largest motorcycle manufacturer in of motorcycles and three wheelers, selling approximately 3.9 million units in the last financial year (reporting date: March 31st 2021). The cooperation focuses on the joint development of entry level street motorcycles, which are produced in India and distributed under the “KTM” brand by both companies in their respective core markets. The Deputy Chairman of the Supervisory Board of KTM AG, Rajiv Bajaj, is Managing Director and CEO of Bajaj Auto Ltd., Pune, India. Srinivasan Ravikumar, a member of the Supervisory Board of KTM AG, is a director of Bajaj Auto International Holdings B.V., Amsterdam, Netherlands, and President of Business Development and Assurance, Bajaj Auto Ltd., Pune, India. Following the simplification of the ownership structure in the 2021 financial year, Bajaj Auto International Holdings B.V, a subsidiary of Bajaj Auto Ltd., now owns 49.9% of Pierer Bajaj AG, which in turn is the majority shareholder (73.32%) of PIERER Mobility AG. Bajaj Auto International Holdings B.V had a direct interest of 47.99% in KTM AG in the previous year. In the course of this restructuring, 161,939 treasury shares in KTM AG were purchased at a purchase price of EUR 179.00 per share from Bajaj Auto International Holdings B.V. and repurchased with effect from December 18th 2021. As of December 31st 2021, there was a liability to Bajaj Auto Ltd. of EUR 9,681k (previous year: EUR 211k). The expenses in the category “Other companies” also largely relate to Bajaj Auto Ltd.

Third-party deliveries of motorcycles and spare parts were made to dealers (KTM Braumandl GmbH, MX - KTM Kini GmbH, SO Regensburg GmbH, KTM Wien GmbH). Revenues and receivables from other companies mainly relate to transactions with these dealers. The minority interests in the dealers are held via Pierer Industrie AG.

50. CORPORATE BODIES OF PIERER MOBILITY AG

The following individuals were appointed as members of the Executive Board with collective power of representation:

Stefan P i e r e r , CEO
Friedrich R o i t h n e r , CFO
Hubert T r u n k e n p o l z, CSO
Viktor S i g l, MBA

The following individuals were appointed as members of the Supervisory Board:

Josef B l a z i c e k , Chairman
Dr. Ernst C h a l u p s k y , Deputy Chairman
Klaus R i n n e r b e r g e r
Alfred H ö r t e n h u b e r

51. EXECUTIVE BOARD AND SUPERVISORY BOARD REMUNERATION

The remuneration for the Executive Board 2021 of PIERER Mobility AG includes salaries, benefits in kind, bonuses, severance payments as well as payments into the company’s staff severance pay fund and amounted to EUR 8,256k (previous year: EUR 4,535k). Furthermore, earnings from previous periods for members of the Executive Board did not result in any subsequent payment. In addition, there are no agreements regarding a company retirement scheme for the Executive Board and no pension fund payments were made to the Executive Board in the 2021 financial year. It is proposed that the remuneration to be paid to the Supervisory Board of PIERER Mobility AG for the 2021 financial year (payout in the 2022 financial year) shall amount to a total of EUR 73k (previous year: EUR 57k). No loans or advances have been granted to the members of the Supervisory Board of PIERER Mobility AG as of the reporting date.

XI. EVENTS AFTER THE REPORTING DATE

On January 20th 2022, the 3rd reading in the National Council resolved to reduce the corporate income tax rate to 24% from 2023 and to 23% from 2024 onward. In the coming years, this will have an estimated effect of around EUR 8 million on the assessment of deferred taxes in the form of a reduction in deferred tax liabilities. PIERER Mobility AG announced on January 27th 2022 via a press release that it was applying for the admission of its shares to the official trading (prime market segment) of the Vienna Stock Exchange. The admission to trading in the prime market of the Vienna Stock Exchange took place on March 1st 2022, which means that PIERER Mobility AG is now also listed in the top segment of the Vienna Stock Exchange. As Europe‘s leading “Powered Two-Wheeler” (PTW) manufacturer with a market capitalization of over EUR 3 billion, the PIERER Mobility Group thus joins the league of the 39 largest and most traded companies on the Vienna Stock Exchange. This step is intended to satisfy the great level of interest among investors in Austria and abroad. The primary listing of the shares of PIERER Mobility AG (ISIN: AT0000KTMI02) will remain with the SIX Swiss Exchange. There have been military conflicts between Russia and Ukraine since February 24, 2022. PIERER Mobility AG has no investments, other assets or other significant business relationships in either country. Therefore, there are no significant financial effects on the financial statements of PIERER Mobility AG as of December 31, 2021.

XII. GROUP COMPANIES (SCHEDULE OF EQUITY HOLDINGS)

The schedule of equity holdings comprises all companies that have been included in the consolidated financial statements in addition to the parent companies.

Company	Initial consolidation date	12/31/21 Interest %	12/31/21 Consolidation type	12/31/20 Interest %	12/31/20 Consolidation type
Fully consolidated companies
KTM AG, Mattighofen	5/31/2005	99.75	FC	51.71	FC
KTM Immobilien GmbH, Mattighofen	5/31/2005	99.75	FC	51.71	FC
KTM North America, Inc., Amherst, Ohio, USA	5/31/2005	99.75	FCA	51.71	FCA
KTM-Motorsports Inc., Murrieta, CA, USA	5/31/2005	99.75	FCA	51.71	FCA
KTM Japan K.K., Tokyo, Japan	5/31/2005	99.75	FCA	51.71	FCA
KTM-Racing AG, Frauenfeld, Switzerland	5/31/2005	99.75	FCA	51.71	FCA
KTM Sportcar GmbH, Mattighofen	5/31/2005	99.75	FC	51.71	FC
KTM Motorcycles S.A. Pty. Ltd., Midrand, South Africa	3/1/2009	99.75	FCA	51.71	FCA
KTM Sportmotorcycle Mexico C.V. de S.A., Lerma, Mexico	6/1/2009	99.75	FCA	51.71	FCA
KTM Sportmotorcycle GmbH, Mattighofen	3/31/2011	99.75	FC	51.71	FC
KTM-Sportmotorcycle India Private Limited, Pune, India	6/1/2012	99.75	FCA	51.71	FCA
Husqvarna Motorcycles GmbH, Mattighofen	1/1/2013	99.75	FC	51.71	FC
KTM Sportmotorcycle Deutschland GmbH, Ursensollen, Germany	12/31/2013	99.75	FCA	51.71	FCA
KTM Switzerland Ltd., Frauenfeld, Switzerland	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle UK Ltd., Northamptonshire, UK	12/31/2013	99.75	FCA	51.71	FCA
KTM-Sportmotorcycle Espana S.L., Terrassa, Spain	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle France SAS, Saint-Priest, France	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle Italia S.r.l., Meran, Italy	12/31/2013	99.75	FCA	51.71	FCA
KTM-Sportmotorcycle Nederland B.V., Malden, Netherlands	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle Scandinavia AB, Örebro, Sweden	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle Belgium S.A., Gembloux, Belgium	12/31/2013	99.75	FCA	51.71	FCA
KTM Canada Inc., Chambly, Canada	12/31/2013	99.75	FCA	51.71	FCA
KTM Hungária Kft., Budapest, Hungary	12/31/2013	99.75	FCA	51.71	FCA
KTM Central East Europe s.r.o., Bratislava, Slovakia	12/31/2013	99.75	FCA	51.71	FCA
KTM Österreich GmbH, Mattighofen	12/31/2013	99.75	FC	51.71	FC
KTM Nordic Oy, Vantaa, Finland	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle d.o.o., Marburg, Slovenia	12/31/2013	99.75	FCA	51.71	FCA
KTM Czech Republic s.r.o., Pilsen, Czech Republic	12/31/2013	99.75	FCA	51.71	FCA
KTM Sportmotorcycle SEA PTE. Ltd., Singapore, Singapore	1/1/2014	99.75	FCA	51.71	FCA
Husqvarna Motorcycles Deutschland GmbH, Ursensollen, Germany	12/31/2013			51.71	FCA
Husqvarna Motorcycles North America, Inc., Murrieta, CA, USA	12/1/2013	99.75	FCA	51.71	FCA
Husqvarna Motorsports, Inc., Murrieta, CA, USA	4/1/2015	99.75	FCA	51.71	FCA
Husqvarna Motorcycles S.A. Pty.
:---	:---	:---	:---	:---	:---
KTM do Brasil Ltda., Sao Paulo, Brazil	12/31/2017	99.75	FCA	51.71	FCA
KTM Components GmbH, Munderng	11/30/2007	99.75	FC	51.71	FC
WP Immobilien GmbH, Munderng	4/30/2005	99.75	FC	51.71	FC
KTM Beteiligungs GmbH, Mattighofen	4/30/2018	99.75	FC	51.71	FC
KTM Australia Holding Pty Ltd., Prestons, Australia	7/1/2019	99.75	FCA	51.71	FCA
KTM Australia Pty Ltd., Prestons, Australia	7/1/2019	99.75	FCA	51.71	FCA
HQVA Pty Ltd., Prestons, Australia	7/1/2019	99.75	FCA	51.71	FCA
KTM Motorcycles Distributers NZ Limited Wellington Central, New Zealand	7/1/2019	99.75	FCA	51.71	FCA
Cero Design Studio S.L., Barcelona, Spain	10/1/2019	49.88	FCA	25.86	FCA
GASGAS Motorcycles GmbH, Mattighofen	10/31/2019	99.75	FC	51.71	FC
GASGAS Motorcycles Espana S.L.U. (formerly: Canepa Investments S.L.)	1/1/2020	99.75	FCA	51.71	FCA
Terrassa, Spain
KTM MOTOHALL GmbH, Mattighofen	1/1/2020	89.78	FC	46.54	FC
KTM Racing GmbH, Mattighofen	2/29/2020	99.75	FC	51.71	FC
KTM Forschungs & Entwicklungs GmbH, Mattighofen, Austria	3/31/2021	99.75	FC	-	-
PIERER E-Bikes GmbH, Munderng	2/25/2020	100.00	FC	100.00	FC
bikes&wheels 2 Radhandels GmbH (formerly: (4) SPORTS GmbH), Wels	4/30/2020	-	-	100.00	FC
PIERER E-Bikes Deutschland GmbH (formerly: PEXCO GmbH), Schweinfurt	12/31/2019	100.00	FCA	100.00	FCA
Germany
PIERER E-Bikes Suisse GmbH (formerly: bikes&wheels Suisse GmbH)	12/31/2019	100.00	FCA	100.00	FCA
Frauenfeld, Switzerland
PEXCO France SAS, Saint-Priest, France	12/31/2019	-	-	100.00	FCA
PIERER E-Bikes Espana S.L. (formerly: bikes&wheels 2RUEDAS Espana S.L.)	12/31/2013	100.00	FCA	100.00	FCA
Terrassa, Spain
PIERER E-Bikes France SAS (formerly: bikes&wheels France SAS)	12/31/2013	100.00	FCA	100.00	FCA
Saint-Priest, France
PIERER E-Bikes Italia S.r.l. (formerly: bikes&wheels Italia S.r.l.)	12/31/2013	100.00	FCA	100.00	FCA
Meran, Italy
PIERER E-Bikes Scandinavia AB (formerly: bikes&wheels Scandinavia AB)	12/31/2013	100.00	FCA	100.00	FCA
Örebro, Sweden
PIERER E-Bikes North America Inc. (formerly: bikes&wheels North America Inc.)	10/1/2020	100.00	FCA	100.00	FCA
Murrieta, CA, USA
PIERER E-Bikes UK Ltd. (formerly: Husqvarna Motorcycles UK Ltd.)	12/31/2013	100.00	FCA	51.71	FCA
Northamptonshire, UK
PIERER E-Bikes Benelux, Gembloux, Belgium	11/29/2021	100.00	FCA	-	-
Felt GmbH, Munich, Germany	11/17/2021	100.00	FCA	-	-
PIERER & MAXCOM MOBILITY OOD, Plovdiv, Bulgaria	7/21/2021	50.00	FCA	-	-
HDC GmbH (formerly: PF Beteiligungsverwaltungs GmbH), Wels	12/31/2016	100.00	FC	100.00	FC
KTM E-Technologies GmbH (formerly: KTM Technologies GmbH), Anif	10/1/2019	100.00	FC	74.00	FC

193

ANNUAL REPORT 2021

Company	Initial consolidation date	12/31/21 Interest %	12/31/21 Consolidation type	12/31/20 Interest %	12/31/20 Consolidation type
KTM Innovation GmbH, Wels	3/31/2018	100.00	FC	100.00	FC
Avocodo GmbH, Linz	4/30/2019	100.00	FC	100.00	FC
Platin 1483. GmbH, Schweinfurt, Germany	12/31/2019	100.00	FCA	100.00	FCA
DealerCenter Digital GmbH, Landshut, Germany	7/31/2021	75.46	FCA	45.00	IEA
Associated companies:
KTM Asia Motorcycle Manufacturing Inc., Binan, Laguna, Philippines	-	39.90	IEA	17.58	IEA
Zhejiang CFMOTO-KTMR2R Motorcycles Co., Ltd., Hangzhou City, Zhejiang, China	-	48.88	IEA	25.34	IEA
Kiska GmbH, Anif	-	50.00	IE	50.00	IE
Other non-current nancial assets:
Wethje Immobilien GmbH, Vilshofen-Pleinting, Germany	-	-	-	6.00	-
AC styria Mobilitätscluster GmbH, Grambach	-	12.33	-	12.33	-

1) held via the KTM Group in the previous year

Legend:
FC Full consolidation, domestic
FCA Full consolidation, foreign
IE Inclusion at equity, domestic
IEA Inclusion at equity, foreign

XIII. APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS

The consolidated nancial statements were approved by the Executive Board on March 22nd 2022 (previous year: March 23rd 2021) for review by the Supervisory Board, for submission to the annual general meeting and for subsequent publication. Within the scope of the review it is required to perform, the Supervisory Board may require changes to be made to the consolidated nancial statements.

Wels, March 11th 2022

The Executive Board of PIERER Mobility AG

Stefan Pierer
Friedrich Roithner
Hubert Trunkenpolz
Viktor Sigl

194

REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS

AUDIT OPINION

We have audited the consolidated nancial statements of PIERER Mobility AG, Wels, Austria, and its subsidiaries („the Group“), which comprise the consolidated statement of nancial position as at 31 December 2021, and the consolidated income statement and consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash ows for the year then ended, and the notes to the consolidated nancial statements.

In our opinion, the consolidated nancial statements comply with the legal requirements and present fairly, in all material respects, the consolidated nancial position of the Group as at 31 December 2021, and its consolidated nancial performance and consolidated cash ows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU, and the additional requirements pursuant to Section 245a UGB (Austrian Commercial Code).

BASIS FOR OUR OPINION

We conducted our audit in accordance with the EU Regulation 537/2014 („AP Regulation“) and Austrian Standards on Auditing. These standards re- quire the audit to be conducted in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the „Auditor’s Responsibilities“ section of our report. We are independent of the audited Group in accordance with Austrian company law and professional regulations, and we have fullled our other responsibilities under those relevant ethical requirements. We believe that the audit evi- dence we have obtained up to the date of the auditor’s report is sufcient and appropriate to provide a basis for our audit opinion on this date.

KEY AUDIT MATTERS

Key audit matters are those matters that, in our professional judgment, were of most signicance in our audit of the consolidated nancial state- ments. These matters were addressed in the context of our audit of the consolidated nancial statements as a whole, however, we do not provide a separate opinion thereon.

RECOGNITION OF DEVELOPMENT COSTS

Refer to note 22 Risk for the Consolidated Financial Statements

In the consolidated nancial statements of PIERER Mobility AG, development costs of EUR 353 million are reported under the balance sheet item „Intangible assets“ and therefore represent a signicant portion of the group‘s assets. According to IAS 38, the Group recognizes research costs are as expenses, while development costs for future serial products are capitalized if the capitalization requirements according to IAS 38.57ff. are ful- lled. The main requirments for recognizing development costs as assets are the feasibility of the development projects (including the possibility of technical realization, the intention to complete and the ability to use) and the expected achievement of future economic benets. The complexity of research and development projects is increasing due to the group’s technology leadership as the leading powered two-wheeler manufacturer in Europe and the associated new development projects (including investments in electromobility and a range of zero-emission products). The assessment of project feasibility plays an important role in this context and is subject to discretionary decicions by management. In addition to meeting the recognition requirements in accordance with IAS 38.57ff. the recording of time and cost for development projects also plays an important role in accuratley calculating development costs.

ANNUAL REPORT 2021

195

Our Response

We assessed the recognition of development costs as follows:

We obtained an understanding of managements process for the distinction between research and development costs and the evaluation of the recognition requirements of development costs according to IAS 38.57ff.
We evaluated the design, establishment and effectiveness of management‘s process-related controls over the capitalization of development costs, including review of management‘s project feasibility documentation.
We assessed, on the basis of random samples, whether a proper distinction has been made between research and development costs capitalized as intangible assets.
We evaluated, on a sample basis, the adequacy of capitalized expenses by reconciling material costs, overheads and accumulated engineering hours to external invoices and internal timesheets and payslips.

OTHER INFORMATION

Management is responsible for other information. Other information is all information provided in the annual report, other than the consolidated nancial statements, the group management report and the auditor’s report. Until the date of this report we have received the following chapters of the annual report: corporate governance report and report of the supervisory board. The remaining parts of the annual report will probably be made available to us after this date. Our opinion on the consolidated nancial statements does not cover other information and we do not provide any kind of assurance thereon. In conjunction with our audit, it is our responsibility to read this other information and to assess whether, based on knowledge gained during our audit, it contains any material inconsistencies with the consolidated nancial statements or any apparent material misstatement of fact.If, on the basis of our work on the other information obtained before the date of the auditor‘s report, we conclude that there is a material misstatement of fact in other information, we must report that fact. We have nothing to report in this regard.

RESPONSIBILITIES OF MANAGEMENT AND THE AUDIT COMMITTEE FOR THE CONSOLIDATED FINANCIAL STATEMENTS

Management is responsible for the preparation and fair presentation of the consolidated nancial statements in accordance with International Finan- cial Reporting Standards (IFRSs) as adopted by the EU, the additional requirements pursuant to Section 245a UGB (Austrian Commercial Code) and for such internal controls as management determines are necessary to enable the preparation of consolidated nancial statements that are free from material misstatement, whether due to fraud or error. Management is also responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting, unless management either intents to liquidate the Group or to cease operations, or has no realistic alternative but to do so. The audit committee is responsible for overseeing the Group’s nancial reporting process.

196

AUDITOR’S RESPONSIBILITIES

Our objectives are to obtain reasonable assurance about whether the consolidated nancial statements as a whole are free from material misstate- ment, whether due to fraud or error, and to issue an auditor’s report that includes our audit opinion. Reasonable assurance represents a high level of assurance, but provides no guarantee that an audit conducted in accordance with the AP Regulation and Austrian Standards on Auditing (and there- fore ISAs), will always detect a material misstatement, if any. Misstatements may result from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to inuence the economic decisions of users taken on the basis of these consolidated nancial statements.

As part of an audit in accordance with the AP Regulation and Austrian Standards on Auditing, we exercise professional judgment and maintain profes- sional skepticism throughout the audit. Moreover:

We identify and assess the risks of material misstatement in the consolidated nancial statements, whether due to fraud or error, we design and perform audit procedures responsive to those risks and obtain sufcient and appropriate audit evidence to serve as a basis for our audit opinion. The risk of not detecting material misstatements resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or override of internal control.

We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group‘s internal control.

We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by ma- nagement.

We conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast signicant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our audit report to the respective note in the con- solidated nancial statements. If such disclosures are not appropriate, we will modify our audit opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.

We evaluate the overall presentation, structure and content of the consolidated nancial statements, including the notes, and whether the consoli- dated nancial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We obtain sufcient appropriate audit evidence regarding the nancial information of the entities and business activities within the Group to ex- press an opinion on the consolidated nancial statements.

We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the audit committee regarding, amongst other matters, the planned scope and timing of our audit as well as signicant n- dings, including any signicant deciencies in internal control that we identify during our audit.

We communicate to the audit committee that we have complied with the relevant professional requirements in respect of our independence, that we will report any relationships and other events that could reasonably affect our independence and, where appropriate, the related safeguards.

From the matters communicated with the audit committee, we determine those matters that were of most signicance in the audit i.e. key audit matters. We describe these key audit matters in our auditor’s report unless laws or other legal regulations preclude public disclosure about the matter or when in very rare cases, we determine that a matter should not be included in our audit report because the negative consequences of doing so would reasonably be expected to outweigh the public benets of such communication.

196

ANNUAL REPORT 2021

197

REPORT ON OTHER LEGAL REQUIREMENTS

GROUP MANAGEMENT REPORT

In accordance with Austrian company law, the group management report is to be audited as to whether it is consistent with the consolidated nancial statements and prepared in accordance with legal requirements. Management is responsible for the preparation of the group management report in accordance with Austrian company law and other legal or regula- tory requirements. We have conducted our audit in accordance with generally accepted standards on the audit of group management reports.

Opinion

In our opinion, the group management report is consistent with the consolidated nancial statements and has been prepared in accordance with legal requirements. The disclosures pursuant to Section 243a UGB (Austrian Commercial Code) are appropriate.

Statement

Based on our knowledge gained in the course of the audit of the consolidated nancial statements and our understanding of the Group and its en- vironment, we did not note any material misstatements in the group management report.

ADDITIONAL INFORMATION IN ACCORDANCE WITH ARTICLE 10 AP REGULATION

We were elected as auditors at the Annual General Meeting on 29 April 2021 and were appointed by the supervisory board on 29 September 2021 to audit the nancial statements of Company for the nancial year ending on 31 December 2021. We have been auditors of the Company, without interruption, since the consolidated nancial statements as at 31 December, 2014.

We declare that our opinion expressed in the „Report on the Consolidated Financial Statements“ section of our report is consistent with our additional report to the Audit Committee, in accordance with Article 11 AP Regulation.

We declare that we have not provided any prohibited non-audit services (Article 5 Paragraph 1 AP Regulation) and that we have ensured our independence throughout the course of the audit, from the audited Group.

ENGAGEMENT PARTNER

The engagement partner is Mr Helge Löfer.

Linz, 11 March 2022

KPMG Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft

This report is a translation of the original report in German, which is solely valid. The consolidated nancial statements together with our auditor‘s opinion may only be published if the consolidated nancial statements and the group management report are identical with the audited version attached to this report. Section 281 Paragraph 2 UGB (Austrian Commercial Code) applies.

kpmg

PIE RER Mobility AG, Wels

Jahresabschluss und Lagebericht zum 31. Dezember 2021 . zum 31. Dezember 2021

PIERER Mobility AG

Bilanz
€ 31.12.2021 € 31.12.2020

Aktiva
A. Anlagevermögen
I. Immaterielle Vermögensgegenstände
1. Software | 0,03 | 3.783,10
II. Sachanlagen
1. Betriebs- und Geschäftsausstattung | 346.593,64 | 409.794,51
2. Anlagen in Bau | 14.960,00 | 0,00
| 361.553,64 | 409.794,51
III. Finanzanlagen
1. Anteile an verbundenen Unternehmen | 1.236.131.439,39 | 354.277.503,02
2. Ausleihungen an verbundene Unternehmen | 250.000,00 | 6.000.000,00
3. Beteiligungen | 9.701.000,00 | 11.216.570,30
4. Ausleihungen an Unternehmen, mit denen ein Beteiligungsverhältnis besteht | 0,00 | 150.000,00
5. Wertpapiere (Wertrechte) des Anlagevermögens | 206.031,20 | 206.032,20
| 1.246.288.470,59 | 371.850.105,52
| 1.246.650.024,26 | 372.263.683,13
B. Umlaufvermögen
I. Forderungen und sonstige Vermögensgegenstände
1. Forderungen aus Lieferungen und Leistungen | 12.690,38 | 11.383,29
2. Forderungen gegenüber verbundenen Unternehmen | 58.046.481,81 | 2.776.328,65
davon aus Lieferungen und Leistungen | 3.730.803,41 | 1.164.926,02
davon sonstige | 54.315.678,40 | 1.611.402,63
davon mit einer Restlaufzeit von mehr als einem Jahr | 602.610,42 | 600.000,00
3. Forderungen gegenüber Unternehmen, mit denen ein Beteiligungsverhältnis besteht | 23.478,00 | 2.093,75
davon aus Lieferungen und Leistungen | 23.478,00 | 0,00
davon sonstige | 0,00 | 2.093,75
davon mit einer Restlaufzeit von mehr als einem Jahr | 0,00 | 2.093,75
4. sonstige Forderungen und Vermögensgegenstände | 510.338,20 | 517.102,33
davon mit einer Restlaufzeit von mehr als einem Jahr | 0,00 | 17.826,51
| 58.592.988,39 | 3.306.908,02
II. Wertpapiere und Anteile
1. sonstige Wertpapiere und Anteile | 1.194.288,76 | 1.194.288,76

€ 31.12.2021 € 31.12.2020

Passiva
A. Eigenkapital
I.# PIERER Mobility AG

Bilanz

€ 31.12.2021	€ 31.12.2020
Aktiva
III. Guthaben bei Kreditinstituten	16.786.433,45
	76.573.710,60
C. Rechnungsabgrenzungsposten	3.357.333,28
Summe Aktiva	1.326.581.068,14

Passiva

€ 31.12.2021	€ 31.12.2020
A. Eigenkapital
I. Gezeichnetes Kapital
eingefordertes Grundkapital	33.796.535,00
übernommenes Grundkapital	33.796.535,00
Nennbetrag eigener Aktien	0,00
einbezahltes Grundkapital	33.796.535,00
II. Kapitalrücklagen
1. gebundene	9.949.093,87
2. nicht gebundene	1.091.905.445,97
	1.101.854.539,84
III. Gewinnrücklagen
1. gesetzliche Rücklagen	3.379.653,50
IV. Bilanzgewinn	142.257.203,61
davon Gewinnvortrag	86.964.079,73
	1.281.287.931,95
B. Rückstellungen
1. Rückstellungen für Abfertigungen	0,00
2. sonstige Rückstellungen	2.539.736,43
	2.539.736,43
C. Verbindlichkeiten
1. Anleihen und Schuldverschreibungen	36.000.000,00
davon mit einer Restlaufzeit von bis zu einem Jahr	6.000.000,00
davon mit einer Restlaufzeit von mehr als einem Jahr	30.000.000,00
2. Verbindlichkeiten aus Lieferungen und Leistungen	1.248.570,13
davon mit einer Restlaufzeit von bis zu einem Jahr	1.248.570,13
3. Verbindlichkeiten gegenüber verbundenen Unternehmen	4.556.490,57
davon aus Lieferungen und Leistungen	4.554.193,70
davon sonstige	2.296,87
davon mit einer Restlaufzeit von bis zu einem Jahr	4.556.490,57
4. Verbindlichkeiten gegenüber Unternehmen, mit denen ein Beteiligungsverhältnis besteht	0,00
davon aus Lieferungen und Leistungen	0,00
davon mit einer Restlaufzeit von bis zu einem Jahr	0,00
5. sonstige Verbindlichkeiten	948.339,06
davon aus Steuern	0,00
davon im Rahmen der sozialen Sicherheit	1.689,98
davon mit einer Restlaufzeit von bis zu einem Jahr	948.339,06
davon mit einer Restlaufzeit von mehr als einem Jahr	0,00
	42.753.399,76
davon mit einer Restlaufzeit von bis zu einem Jahr	12.753.399,76
davon mit einer Restlaufzeit von mehr als einem Jahr	30.000.000,00
Summe Passiva	1.326.581.068,14

Beilage I/1. zum 31. Dezember 2021

PIERER Mobility AG Gewinn- und Verlustrechnung

€ 2021	€ 2020
1. Umsatzerlöse	14.106.939,47
2. sonstige betriebliche Erträge
a) Erträge aus der Auflösung von Rückstellungen	250.000,00
b) übrige	24.349,82
	274.349,82
3. Aufwendungen für Material und sonstige bezogene Herstellungsleistungen
a) Aufwendungen für bezogene Leistungen	10.300.519,16
4. Personalaufwand
a) Gehälter	44.354,86
b) soziale Aufwendungen	-21.844,83
aa) Aufwendungen für Abfertigungen und Leistungen an Mitarbeitervorsorgekassen	-48.254,67
bb) Aufwendungen für gesetzlich vorgeschriebene Sozialabgaben sowie vom Entgelt abhängige Abgaben und Pflichtbeiträge	22.015,06
	22.510,03
5. Abschreibungen
a) auf immaterielle Gegenstände des Anlagevermögens und Sachanlagen	72.973,08
6. sonstige betriebliche Aufwendungen
a) Steuern, soweit sie nicht unter Steuern vom Einkommen fallen	6.492,04
b) übrige	14.743.799,35
	14.750.291,39
7. Zwischensumme aus Z 1 bis 6 (Betriebsergebnis)	-10.765.004,37
8. Erträge aus Beteiligungen	84.512.060,86
9. Erträge aus Ausleihungen des Finanzanlagevermögens	2.610,42
davon aus verbundenen Unternehmen	2.610,42
10. sonstige Zinsen und ähnliche Erträge	114.807,37
davon aus verbundenen Unternehmen	114.177,95
11. Aufwendungen aus Finanzanlagen	16.275.509,22
davon Abschreibungen auf Finanzanlagen	16.275.509,22
12. Zinsen und ähnliche Aufwendungen	1.359.895,08
13. Zwischensumme aus Z 8 bis 12 (Finanzergebnis)	66.994.074,35
14. Ergebnis vor Steuern (Summe aus Z 7 und Z 13)	56.229.069,98
15. Steuern vom Einkommen	3.500,00

Beilage I/2. 1.1.2021 bis 31.12.2021

PIERER Mobility AG Gewinn- und Verlustrechnung

€ 2021	€ 2020
davon weiterverrechnet vom Gruppenträger	3.500,00
16. Ergebnis nach Steuern	56.225.569,98
17. Jahresüberschuss	56.225.569,98
18. Auflösung von Kapitalrücklagen	193.340,00
19. Zuweisung zu Gewinnrücklagen	1.125.786,10
20. Gewinnvortrag aus dem Vorjahr	86.964.079,73
21. Bilanzgewinn	142.257.203,61

Beilage I/3. 1.1.2021 bis 31.12.2021

Anhang

PIERER Mobility AG Anhang Bilanzierungs- und Bewertungsmethoden

Allgemeine Grundsätze

Der Jahresabschluss wurde nach den Vorschriften der §§ 189 ff des Unternehmensgesetzbuchs (UGB) unter Beachtung der Grundsätze ordnungsmäßiger Buchführung, sowie unter Beachtung der Generalnorm, ein möglichst getreues Bild der Vermögens-, Finanz- und Ertragslage des Unternehmens zu vermitteln, aufgestellt. Bei der Gesellschaft handelt es sich um eine große Kapitalgesellschaft im Sinne des § 221 UGB. Bei Vermögensgegenständen und Verbindlichkeiten, die unter mehrere Posten der Bilanz fallen, wurde die Zugehörigkeit zu anderen Posten im Anhang angegeben. Bei der Erstellung des Jahresabschlusses wurde der Grundsatz der Vollständigkeit entsprechend den gesetzlichen Regelungen eingehalten. Bei der Bewertung der einzelnen Vermögensgegenstände und Schulden wurde der Grundsatz der Einzelbewertung beachtet und eine Fortführung des Unternehmens unterstellt. Dem Vorsichtsprinzip wurde dadurch Rechnung getragen, dass nur die am Abschlussstichtag verwirklichten Gewinne ausgewiesen wurden. Alle erkennbaren Risiken und drohenden Verluste wurden - soweit gesetzlich geboten - berücksichtigt. Die Gesellschaft ist ein konsolidierungspflichtiges Mutterunternehmen im Sinne des §244 UGB und hat einen Konzernabschluss, der beim Landesgericht Wels unter der Nummer FN 78112x hinterlegt wird, aufzustellen. Die Gesellschaft ist ein Konzernunternehmen iSd § 15 AktG (§ 115 GmbHG) und gehört als verbundenes Unternehmen gem. § 244 UGB zum Konsolidierungskreis der Pierer Konzerngesellschaft mbH.

Anlagevermögen

Immaterielles Anlagevermögen

Die erworbenen immateriellen Vermögensgegenstände wurden zu Anschaffungskosten bewertet, die um die planmäßigen Abschreibungen vermindert sind. Die planmäßigen Abschreibungen wurden linear vorgenommen. Gemäß den steuerrechtlichen Vorschriften wird für Zugänge im ersten Halbjahr eine volle Jahresabschreibung , für Zugänge im zweiten Halbjahr eine halbe Jahresabschreibung vorgenommen. Folgende Nutzungsdauern wurden den planmäßigen Abschreibungen zugrunde gelegt:

Nutzungsdauer in Jahren |
---|---
Software | 3

Beilage I/5.

Sachanlagen

Das abnutzbare Sachanlagevermögen wurde zu Anschaffungs- oder Herstellungskosten bewertet, die um die planmäßigen Abschreibungen vermindert werden. Die geringwertigen Vermögensgegenstände bis zu einem Wert von EUR 800,00 wurden im Zugangsjahr voll abgeschrieben. Die planmäßigen Abschreibungen wurden linear der voraussichtlichen Nutzungsdauer entsprechend vorgenommen. Gemäß den steuerrechtlichen Vorschriften wird für Zugänge im ersten Halbjahr eine volle Jahresabschreibung, für Zugänge im zweiten Halbjahr eine halbe Jahresabschreibung vorgenommen. Folgende Nutzungsdauern wurden den planmäßigen Abschreibungen zugrunde gelegt:

Nutzungsdauer in Jahren |
---|---
Betriebs- und Geschäftsausstattung | 1 - 20

Finanzanlagen

Das Finanzanlagevermögen wurde zu Anschaffungskosten vermindert um außerplanmäßige Abschreibungen – soweit diese notwendig sind, um dauernden Wertminderungen Rechnung zu tragen – angesetzt. Die im Jahresabschluss ausgewiesenen Anteile an verbundenen Unternehmen, Beteiligungen und Wertpapiere (Wertrechte) des Anlagevermögens werden im Anlassfall auf ihre Werthaltigkeit untersucht. Zum 31. Dezember 2021 lag bei den wesentlichen Anteilen an verbundenen Unternehmen kein Anlassfall für eine Werthaltigkeitsprüfung vor. Anlassbezogene Bewertungen werden auf Basis von diskontierten Netto-Zahlungsmittelzuflüssen, die im Wesentlichen von zukünftigen Umsatz- und Margenerwartungen und von abgeleiteten Diskontierungszinssätzen abhängig sind, durchgeführt. Für Anteile die kurz vor dem Bilanzstichtag erworben wurden, bildet der Kaufpreis die Grundlage für die geführte Werthaltigkeitsprüfung. Bei der Werthaltigkeitsprüfung ergaben sich keine Abwertungserfordernisse.

Umlaufvermögen

Forderungen und sonstige Vermögensgegenstände

Die Forderungen und sonstigen Vermögensgegenstände wurden mit dem Nennwert angesetzt. Im Falle erkennbarer Einzelrisken wurde der niedrigere beizulegende Wert angesetzt.

Beilage I/6.

Rückstellungen

Rückstellungen für Anwartschaften auf Abfertigungen und ähnliche Verpflichtungen

Im Vorjahr wurde die Abfertigungsrückstellung nach anerkannten finanzmathematischen Grundsätzen auf Basis eines Rechnungszinssatzes von 1,10 % ermittelt. Der Rechnungszinssatz wurde im Vorjahr unter Berücksichtigung des 13jährigen Konzerndurchschnittszinssatzes in Höhe von 1,04 % und einer durchschnittlichen Bezugserhöhung von 2,50 % ermittelt. Im Vorjahr wurde das gesetzliche Pensionsantrittsalter berücksichtigt.

Sonstige Rückstellungen

In den sonstigen Rückstellungen wurden unter Beachtung des Vorsichtsprinzips alle im Zeitpunkt der Bilanzerstellung erkennbaren Risiken und der Höhe oder dem Grunde nach ungewissen Verbindlichkeiten mit den Beträgen berücksichtigt, die nach bestmöglicher Schätzung zur Erfüllung der Verpflichtung aufgewendet werden müssen. Sämtliche Rückstellungen haben eine Laufzeit von weniger als einem Jahr.

Verbindlichkeiten

Verbindlichkeiten wurden mit ihrem Erfüllungsbetrag angesetzt.# Anhang PIERER Mobility AG

Erläuterungen der Bilanz und der Gewinn- und Verlustrechnung

Erläuterungen zur Bilanz

Anlagevermögen

Die Entwicklung der einzelnen Posten des Anlagevermögens und die Aufgliederung der Jahresabschreibung nach einzelnen Posten sind in folgendem Anlagenspiegel dargestellt:

Anschaffungs-/Herstellungskosten	Abschreibungen kumuliert	Buchwert
1.1.2021	31.12.2021	Zugänge
EUR	EUR	EUR
Anlagevermögen
Immaterielle Vermögensgegenstände
Software	109 034,82	0,00
Sachanlagen
Betriebs- und Geschäftsausstattung	1 334 327,10	5 989,14
Anlagen in Bau	0,00	14 960,00
	1 334 327,10	20 949,14
Finanzanlagen
Anteile an verbundenen Unternehmen	369 527 503,02	896 117 459,99
Ausleihungen an verbundene Unternehmen	6 000 000,00	100 000,00
Beteiligungen	11 216 570,30	496 414,30
Ausleihungen an Unternehmen, mit denen ein Beteiligungsverhältnis besteht	150 000,00	0,00
Wertpapiere (Wertrechte) des Anlagevermögens	266 031,20	0,00
	387 160 104,52	896 713 874,29
Summe Anlagenspiegel	388 603 466,44	896 734 823,43

Die Finanzanlagen haben sich insbesondere durch folgende Transaktionen verändert: Mit Einbringungs- und Sacheinlagevertrag vom 19.10.2021 hat die Pierer Bajaj AG (vormals: PTW Holding AG) 5.042.925 Stk. (46,5%) Aktien der KTM AG in Form einer Kapitalerhöhung in die PIERER Mobility AG eingebracht. Weiters hat die PIERER Mobility AG im laufenden Geschäftsjahr 199 Stk. Aktien an der KTM AG, Mattighofen erworben. Die Gesellschaft hält zum Stichtag 99,75% Anteile an der KTM AG, Mattighofen. Mit Kauf- und Abtretungsvertrag vom 14.6.2021 hat die PIERER Mobility AG 26% Anteile an der KTM E-Technologies GmbH (nunmehr: KTM Technologies GmbH), Anif erworben und hält somit 100% Anteile an der Gesellschaft. Mit Geschäftsanteilskaufvertrag vom 30.06.2021 hat die Gesellschaft 30,46% Anteile an der DealerCenter Digital GmbH, Neuried, Deutschland, erworben. Die PIERER Mobility AG hält nun zum Stichtag 75,46 % Anteile an der DealerCenter Digital GmbH.

Beilage I/8 . Anhang PIERER Mobility AG

Zum Stichtag hält die Gesellschaft unverändert 100% Anteile an der PIERER E-Bikes GmbH, Munderfing. Der gesamte Umgründungsmehrwert in Höhe von EUR 57 253 610,76 (Vorjahr: TEUR 57.254) wird dem Tochterunternehmen KTM AG, Mattighofen, zugeordnet. Im laufenden Geschäftsjahr erfolgte eine Ausschüttung des Eigenkapitals (Rücklagen und Bilanzgewinn) der Platin 1483. GmbH. Gleichermaßen wurde der Buchwert der Anteile um EUR 16 275 508,22 abgestockt. Im laufenden Geschäftsjahr sowie im Vorjahr wurden keine Zuschreibungen auf Anteile an verbundenen Unternehemen sowie keine Abschreibungen an Wertpapiere (Wertrechte) des Anlagevermögens vorgenommen.

Forderungen und sonstige Vermögensgegenstände

Die Forderungen gegenüber verbundenen Unternehmen in Höhe von EUR 58 046 481,81 (Vorjahr: EUR 2 776 328,65) betreffen im Wesentlichen Forderungen aus Dividendenanspruch in Höhe von EUR 53 393 530,00 (Vorjahr: EUR 0,00), Forderungen aus Finanzierungsdarlehen und sonstige Verrechnungen in Höhe von EUR 922 148,40 (Vorjahr: EUR 1 611 402,63 ) sowie Forderungen aus laufenden Verrechnungen EUR 3 730 803,41 (Vorjahr: EUR 1 164 926,02 ). Die Forderungen gegenüber Unternehmen, mit denen ein Beteiligungsverhältnis besteht, resultieren in Höhe von EUR 0,00 (Vorjahr: EUR 2 093,75) aus Finanzierungsdarlehen sowie Forderungen aus laufenden Verrechnungen in Höhe von EUR 23 478,00 (Vorjahr: EUR 0,00). Die sonstigen Forderungen und Vermögensgegenstände in Höhe von EUR 510 338,20 (Vorjahr: EUR 517 102,33) betreffen im Wesentlichen Forderungen aus Versicherungsleistungen für ehemalige Mitarbeitern in Höhe von EUR 299 702,99 (Vorjahr: EUR 293 496,81) sowie Forderungen aus geleisteten Anzahlungen in Höhe von EUR 148 298,41 (Vorjahr: EUR 173 850,76).

Eingefordertes und einbezahltes Nennkapital (Grundkapital)

Das eingeforderte und einbezahlte Nennkapital (Grundkapital) der Gesellschaft beträgt EUR 33 796 535,00 (Vorjahr: EUR 22 538 674,00) und ist in 33.796.535 Stück (Vorjahr: 22 538 674 Stück) auf Inhaber lautende nennbetragslose Stückaktien, von denen jede eine gleiche Beteiligung am Grundkapital repräsentiert, aufgeteilt. Im Geschäftsjahr 2021 wurden die gesamten 193.340 Stück eigene Aktien verkauft. Zum Stichtag hält die Gesellschaft 0 Stk. (Vorjahr: 193 340 Stk.). Die Aktien der Gesellschaft notieren an der Frankfurter und an der Schweizer Börse. Der Vorstand wurde bis 26.04.2023 ermächtigt gemäß § 169 AktG das Grundkapital mit Zustimmung des Aufsichtsrats um bis zu weitere EUR 11 269 337,00 durch Ausgabe von bis zu 11 269 337 Stück neue, auf Inhaber oder Namen lautende Stammaktien (Stückaktien) gegen Bar- und/oder Sacheinlage – allenfalls in mehrere Tranchen – zu erhöhen und die weiteren Einzelheiten der Durchführung der Kapitalerhöhung im Einvernehmen mit dem Aufsichtsrat festzusetzen. Diese Ermächtigung wurde vom Vorstand der PIERER Mobility AG zur Durchführung der Sachkapitalerhöhung im Oktober 2021 im Ausmaß von EUR 11 257 861,00 durch Ausgabe von 11.257.861 Stück auf Inhaber lautende nennbetragslose Stückaktien ausgenützt. Am 29.09.2021 beschloss der Vorstand der PIERER Mobility AG das Grundkapital gegen Sacheinlage von EUR 22.538.674,00 um EUR 11.257.861,00 auf EUR 33.796.535,00 durch Ausgabe von insgesamt 11.257.861 neuen auf Inhaber lautende Stückaktien unter Ausschluss des Bezugsrechts der Aktionäre zu erhöhen, wobei die Kapitalerhöhung gegen Sacheinlage von 46,5% der Aktien der KTM AG erfolgt. Am 19.10.2021 hat der Aufsichtsrat der PIERER Mobility AG der Sachkapitalerhöhung und dem Ausschluss der

Beilage I/9 . Anhang PIERER Mobility AG

Bezugsunktionaler Aktionäre zugestimmt. Die gesetzliche Rücklage wurde im Geschäftsjahr um EUR 1 125 786,10 (Vorjahr: EUR 0,00) erhöht. Mit Beschlussfassung der Hauptversammlung der PIERER Mobility AG vom 4.10.2019 hat der Vorstand entschieden, ein Rückkaufprogramm zu lancieren und bis zu 7,404% (entsprechend 20% des Free Floats) des Grundkapitals zurückzukaufen. Basierend darauf umfasst der beschlossene Rückkauf eigener Inhaberaktien maximal 1 668 763 Inhaberaktien. Die PIERER Mobility AG hat ihre 193.340 Stk. eigene Aktien im Geschäftsjahr 2021 verkauft und hält nun keine eigenen Aktien mehr. Die Veränderung der nicht gebundenen Kapitalrücklagen von EUR 194 761 621,70 um EUR 891 996 720,59 auf EUR 1 091 905 445,97 resultiert einerseits aus dem Verkauf von 193.340 Stk. eigenen Aktien sowie aus Sachkapitalerhöhung durch Sacheinlage von 5.042.925 Stück KTM AG Aktien durch die Pierer Bajaj AG (vormals: PTW Holding AG).

Rückstellungen

Zusammensetzung und Entwicklung der Rückstellungen:

	Stand 1.1.2021	Verwendung	Auflösung	Zuweisung	Stand 31.12.2021
	EUR	EUR	EUR	EUR	EUR
1. Rückstellungen für Abfertigungen
Rückstellung für Abfertigungen	49 600,00	49 600,00	0,00	0,00	0,00
2. sonstige Rückstellungen
Rückstellung für nicht konsumierte Urlaube	58 300,00	58 300,00	0,00	0,00	0,00
Rückstellung für Sonderzahlungen	122 560,00	122 560,00	0,00	0,00	0,00
Rückstellung für Zeitguthaben	4 000,00	4 000,00	0,00	0,00	0,00
Rückstellung für Rechtsberatungskosten	46 671,02	46 671,02	0,00	15 000,00	15 000,00
Rückstellung für Wirtschaftsprüfung	102 780,00	102 780,00	0,00	176 500,00	176 500,00
Rückstellung für Steuerberatung	51 440,36	51 440,36	0,00	29 600,00	29 600,00
Sonstige Rückstellungen	2 726 890,00	304 753,57	250 000,00	146 500,00	2 318 636,43
	3 112 641,38	690 504,95	250 000,00	367 600,00	2 539 736,43
Summe Rückstellungen	3 162 241,38	740 104,95	250 000,00	367 600,00	2 539 736,43

Die sonstigen Rückstellunge in Höhe von EUR 2 318 636,43 (Vorjahr: EUR 2 726 890,00) beinhalten im Wesentlichen Rückstellungen für Haftungen und Risiken im Zusammenhang mit dem Beteiligungsportfolio in Höhe von EUR 2 172 136,43 (Vorjahr: EUR 2 600 000,00) sowie Rückstellung für Aufsichtsratsvergütungen in Höhe von EUR 67 000,00 (Vorjahr: EUR 57 000,00).

Verbindlichkeiten

Die PIERER Mobility AG hat im Juli 2015 ein Schuldscheindarlehen in Höhe von EUR 56 500 000,00 begeben, welches in Höhe von EUR 44 000 000,00 mit einer Laufzeit von 5 Jahren und in Höhe von EUR 12 500 000,00 mit einer Laufzeit von 7 Jahre abgeschlossen wurde. Das Schuldscheindarlehen mit einer Laufzeit von 5 Jahren wurde zur gänze rückgeführt. Vom Schuldscheindarlehen mit einer Laufzeit von 7 Jahren wurde bereits am 16.1.2017 ein Betrag in Höhe von EUR 6 500 000,00 vorzeitig rückgeführt und es resultiert zum Stichtag ein Betrag in Höhe von EUR 6 000 000,00 mit einem fixen Zinssatz.

Beilage I/10 . Anhang PIERER Mobility AG

Am 17.7.2015 hat die PIERER Mobility AG eine Namensschuldverschreibung in Höhe von EUR 30 000 000,00 mit einer fixen Laufzeit von 10 Jahren begeben.# Beilage I/11 . Anhang PIERER Mobility AG

Erläuterungen zur Gewinn- und Verlustrechnung

Die Gewinn- und Verlustrechnung wurde nach dem Gesamtkostenverfahren erstellt.

Aufgliederung der Umsatzerlöse

Die Umsatzerlöse setzen sich wie folgt zusammen bzw. haben sich wie folgt entwickelt (Angaben in TEUR):

	2021	2020
	TEUR	TEUR
Umsatzerlöse
Erlöse Inland	14 078	12 625
Erlöse EU	29 891
Erlöse sonstiges Ausland	0	1
Skonti	00
	14 107	13 518

Zusammensetzung der Aufwendungen für Abfertigungen und Leistungen an Mitarbeitervorsorgekassen:

	2021	2020
	EUR	EUR
Dotierung Abfertigung	-100,00	-5 300,00
Veränderung Rückstellung für Abfertigung (Angestellte)	-49 500,00	0,00
MV-Beitrag Angestellte	1 345,33	21 194,60
	-48 254,67	15 894,60

Die Aufwendungen für Abfertigungen und Beiträge an Mitarbeitervorsorgekassen betreffen zur Gänze sonstige Arbeitnehmer.

Sonstige betriebliche Aufwendungen

Die übrigen sonstigen betrieblichen Aufwendungen betreffen im Wesentlichen Aufwendungen für konzerninterne Dienstleistungen und Umlagen, Aufwendungen für Vorstandstätigkeiten, Steuerberatungsaufwand sowie Rechts- und Beratungsaufwand. Bezüglich der Aufwendungen für den Abschlussprüfer wird § 238 (1) Z 18 UGB in Anspruch genommen.

Erträge aus Beteiligungen

Die Erträge aus Beteiligungen in Höhe von EUR 84 512 060,86 (Vorjahr: EUR 14 983 188,00) betreffen Dividendenerträge, davon aus verbundenen Unternehmen EUR 83 699 674,61 (Vorjahr: EUR 14 376 790,00).

Sonstige Zinsen und ähnliche Erträge

Sonsitge Zinsen und ähnliche Erträge in Höhe von EUR 114 807,37 (Vorjahr: EUR 133 710,23) betreffen im Wesentlichen Zinsen aus Darlehen.

Beilage I/12 . Anhang PIERER Mobility AG

Steuern vom Einkommen und vom Ertrag

Seit der Veranlagung 2014 ist die Gesellschaft Gruppenmitglied der Gruppe der Pierer Konzerngesellschaft mbH iSd § 9 KStG. Die steuerlichen Ergebnisse der Gruppenmitglieder werden dem Gruppenträger zugerechnet. Die zu leistenden Steuerumlagen zwischen dem Gruppenträger und jedem einzelnen Gruppenmitglied wurde in Form von einer Gruppen- und Steuerumlagevereinbarung geregelt. Die im Jahresabschluss ausgewiesenen Steuern vom Einkommen und vom Ertrag betreffen in Höhe von EUR 3 500,00 (Vorjahr: EUR 3 500,00) die Steuerumlage an den Gruppenträger (25%).

Die Pierer Mobility AG, Wels, ist seit 1.10.2018 Gruppenmitglied einer Organschaft im umsatzsteuerlichen Sinn, die von der Pierer Industrie AG, Wels, gebildet wird. Zur Unternehmensgruppe gehören folgende Gesellschaften (Gruppenmitglieder):

Pierer Industrie AG, Wels (Gruppenträger)
Pierer Mobility AG, Wels
PIERER E-Bikes GmbH (vormals: Husqvarna E-Bicycles GmbH, Munderfing)
KTM Technologies GmbH (vormals: KTM E-Technologies GmbH), Anif
KTM AG, Mattighofen
KTM Sportmotorcycle GmbH, Mattighofen
KTM Österreich GmbH, Mattighofen
KTM Sportcar GmbH, Mattighofen
KTM Immobilien GmbH, Mattighofen
KTM Logistikzentrum GmbH, Mattighofen
KTM MOTOHALL GmbH, Mattighofen
PIERER Innovation GmbH (vm. KTM Innovation GmbH), Wels
Husqvarna Motorcycles GmbH, Mattighofen
Pankl Racing Systems AG, Kapfenberg
Pankl Immobilienverwaltung GmbH, Kapfenberg
Pankl Aerospace Systems Europe GmbH, Kapfenberg
Krenhof GmbH, Köflach
KTM Components GmbH, Munderfing
WP Immobilien GmbH, Munderfing
WP Suspension GmbH, Mattighofen
GASGAS Motorcycles GmbH, Mattighofen
Avocodo GmbH, Linz
bikes&wheels 2 Radhandels GmbH
KTM Forschungs & Entwicklungs GmbH

Es existieren temporäre Unterschiede zwischen steuerlichen und unternehmensrechtlichen Wertansätzen im Wesentlichen auf Grund von Bewertungsunterschieden im Sachanlagevermögen und bei der Bewertung von Personalrückstellungen. Da zum Bilanzstichtag weder passive latente Steuern zur Gegenverrechnung, als

Beilage I/13 . Anhang PIERER Mobility AG

auch substantielle Hinweise für die Rechtfertigung eines Ansatzes aktiver latenter Steuern vorliegen, wurden keine aktiven latenten Steuern angesetzt.

Sonstige Angaben

Ergebnisverwendung

Vorschlag zur Verwendung des Ergebnisses: Es wird vorgschlagen, aus dem Bilanzgewinn in Höhe von EUR 142 257 203,61 eine Dividende von EUR 1,00 je Aktie, das sind in Summe EUR 33 796 535,20 auszuschütten und den Restbetrag auf neue Rechnung vorzutragen.

Ereignisse nach dem Bilanzstichtag

Folgende wesentliche Ereignisse sind nach dem Abschlussstichtag eingetreten, die weder in der Bilanz noch in der Gewinn- und Verlustrechnung berücksichtigt sind: Die PIERER Mobility AG listete ihre Aktien im Amtlichen Handel (Segment den prime market) der Wiener Börse. Die Handelsaufnahme im prime market, das Top-Segment der Wiener Börse, erfolgte am 1. März 2022.

Unternehmen, das den Konzernabschluss für den größten Kreis von Unternehmen aufstellt

Gemäß § 238 Abs.1 Z 7 und 8 UGB wird wie folgt berichtet:

Name des Mutterunternehmens: Pierer Konzerngesellschaft mbH, FN 134766k
Sitz des Mutterunternehmens: Wels, Österreich
Ort der Offenlegung: Landesgericht Wels

Organe und Arbeitnehmer der Gesellschaft

Im Geschäftsjahr waren folgende Personen als Aufsichtsräte tätig:

Blazicek Josef (Vorsitzender)
Dr. Chalupsky Ernst (Stellvertreter des Vorsitzenden)
Ing. Hörtenhuber Alfred (Mitglied)
Mag. Rinnerberger Klaus (Mitglied)

Der Aufsichtsrat erhält für den Zeitraum 1.1.2021 bis 31.12.2021 eine Vergütungen in Höhe von EUR 73 000,00 (Vorjahr: EUR 57 000,00), der als Vorschlag in der nächsten Hauptversammlung eingebracht wird.

Im Geschäftsjahr waren folgende Personen als Vorstände tätig:

DI Pierer Stefan, CEO
Mag. Roithner Friedrich, CFO
Mag. Ing. Trunkenpolz Huber, CSO

Beilage I/14 . Anhang PIERER Mobility AG

Beteiligungen

Firmenname	Firmensitz	Eigenkapital	Anteil in %	Letztes Ergebnis	Bilanzstichtag
KTM AG	5230 Mattighofen	311 918 870,16	99,75	20 645 943,20	31.12.2020
PIERER E-Bikes GmbH	5222 Munderfing	24 051 600,28	100,0	-1 568 015,25	31.12.2020
Platin 1483. GmbH	97424 Schweinfurt, Deutschland	217 674,11	100,0	-7 325,89	31.12.2021
KTM Technologies GmbH (vormals: KTM E-Technologies GmbH)	5081 Anif	2 405 481,18	100,0	398 271,90	31.12.2020
Avocodo GmbH	4020 Linz	1 573 170,17	100,0	989 354,82	31.12.2021
HDC GmbH	5222 Munderfing	122 892,86	100,0	1 052,39	31.12.2021
PIERER Innovation GmbH (vormals: KTM Innovation GmbH)	4600 Wels	146 729,94	100,0	-262 228,23	31.12.2020
Kiska GmbH	5081 Anif	6 447 793,21	50,0	1 554 768,59	31.3.2021
DealerCenter Digital GmbH	82061 Neuried, Deutschland	728 999,50	75,46	-200 411,92	31.12.2020

Anlage 1 zum Anhang . zum 31.12.2021

PIERER Mobility AG ANLAGENSPIEGEL €€€€€€€€€€€€

	Anschaffungs-/Herstellungskosten	kumulierte Abschreibungen	Buchwerte
	Stand 1.1.2021	Zugänge / Umgründung	Abgänge
A. Anlagevermögen
I. Immaterielle Vermögensgegenstände
1. Software	109.034,82	0,00	0,00
II. Sachanlagen
1. Betriebs- und Geschäftsausstattung	1.334.327,10	5.989,14	71,00
2. Anlagen in Bau	0,00	14.960,00	0,00
	1.334.327,10	20.949,14	71,00
III. Finanzanlagen
1.
# Anhang

Beteiligungsspiegel

	Vorjahreswerte (EUR)	Zugänge (EUR)	Abgänge (EUR)	Zuschreibungen (EUR)	Abschreibungen (EUR)	Zugänge aus Einbringung (EUR)	Abgänge aus Einbringung (EUR)	Zugänge aus Kapitalerhöhung (EUR)	Abgänge aus Kapitalherabsetzung (EUR)	Abgänge aus Dividenden (EUR)	Endwerte (EUR)
1. Anteile an verbundenen Unternehmen	369.527.503,02	896.117.459,99	0,00	2.011.984,60	1.267.656.947,61	15.250.000,00	16.275.508,22	0,00	0,00	31.525.508,22	354.277.503,02
2. Ausleihungen an verbundene Unternehmen	6.000.000,00	100.000,00	6.000.000,00	150.000,00	250.000,00	0,00	0,00	0,00	0,00	0,00	6.000.000,00
3. Beteiligungen	11.216.570,30	496.414,30	0,00	-2.011.984,60	9.701.000,00	0,00	0,00	0,00	0,00	0,00	11.216.570,30
4. Ausleihungen an Unternehmen, mit denen ein Beteiligungsverhältnis besteht	150.000,00	0,00	0,00	-150.000,00	0,00	0,00	0,00	0,00	0,00	0,00	150.000,00
5. Wertpapiere (Wertrechte) des Anlagevermögens	266.031,20	0,00	0,00	0,00	266.031,20	59.999,00	1,00	0,00	0,00	0,00	206.032,20
Summe Anlagevermögen	387.160.104,52	896.713.874,29	6.000.000,00	0,00	1.277.873.978,81	15.309.999,00	16.275.509,22	0,00	0,00	31.525.508,22	371.850.105,52
SUMME ANLAGENSPIEGEL	388.603.466,44	896.734.823,43	6.000.071,00	0,00	1.279.338.218,87	16.339.783,31	16.348.482,30	0,00	71,00	32.688.194,61	372.263.683,13

*) enthält Zugänge aus Einbringung in Höhe von EUR 895.000.000,00

*) Anlage 2 zum Anhang.

Lagebericht PIERER Mobility AG per 31.12.2021

der PIERER Mobility AG, Wels

Da diese Gesellschaft eine geschäftsleitende Holdinggesellschaft ist, beinhaltet der Lagebericht neben den Informationen des Einzelabschlusses auf Basis UGB (Teil 1) auch die Informationen des Konzernabschlusses auf Basis IFRS (Teil 2).

I) Einzelabschluss der PIERER Mobility AG (nach UGB):

A. Geschäftsverlauf und Lage des Unternehmens

Das Geschäftsjahr für den Einzelabschluss der PIERER Mobility AG umfasst den Zeitraum vom 1.1.2021 bis 31.12.2021. Die PIERER Mobility AG hat im Geschäftsjahr 2021 ihre Anteile an KTM AG um 46,5% erhöht, die von der Pierer Bajaj AG als Sacheinlage in Form einer Kapitalerhöhung in die Gesellschaft eingebracht wurden. Die PIERER Mobility AG besitzt zum Abschlussstichtag die Mehrheitsbeteiligung an der KTM AG (99,75%). Zum Stichtag 31.12.2021 hält die PIERER Mobility AG unverändert 100% Anteile an der PIERER E-Bikes GmbH, 100% Anteile an der PIERER Innovation GmbH (vm. KTM Innovation GmbH) 100% der Anteile an der HDC GmbH und 100% Anteile an der Avocodo GmbH. An der Kiska GmbH hält die Gesellschaft unverändert 50% sowie an der AC styria Mobilitätscluster GmbH 12,33%. Im Juni 2021 hat die PIERER Mobility AG 26% der Anteile an der KTM Technologies GmbH (vm. KTM E-Technologies GmbH) erworben und hält nun 100% Anteile an der Gesellschaft. Weiters hat die PIERER Mobility AG 30,46% Anteile an der DealerCenterDigital GmbH, Neuried, Deutschland, erworben und hat ihre Anteile auf 75,46% Anteile erhöht.

Da die PIERER Mobility AG im Wesentlichen die Aufgaben einer geschäftsleitenden Holdinggesellschaft erfüllt, wird im Lagebericht auch auf die Entwicklungen des Geschäftsjahres 2021 ihrer Tochtergesellschaften sowie des Konzerns insgesamt eingegangen.

B. Ertrags- und Vermögenslage

1. Ergebnisanalyse

Die PIERER Mobility AG hat im abgelaufenen Geschäftsjahr einen Jahresüberschuss von € 56,2 Mio. (Vorjahr: € 12,0 Mio.) erzielt. Positiv wirkten sich im Wesentlichen Dividendenerträge aus den Beteiligungsunternehmen in Höhe von € 84,5 Mio. aus. In Folge einer Dividendenausschüttung wurde eine Teilwertabschreibung in Höhe von € 16,3 Mio. vorgenommen, die das das Ergebnis negativ beeinflusst hat. Negativ wirkten sich vor allem die sonstigen betrieblichen Aufwendungen aus. Diese betreffen im Wesentlichen Aufwendungen für konzerninterne Dienstleistungen und Umlagen, Aufwendungen für Vorstandstätigkeiten, Steuerberatungsaufwand sowie Rechts- und Beratungsaufwand.

Beilage II/1.

Lagebericht PIERER Mobility AG

2. Bilanzanalyse

Die Bilanzsumme zum 31.12.2021 in Höhe von € 1.326,6 Mio (Vorjahr: € 387,3 Mio) hat sich um € 939,3 Mio. erhöht, was im Wesentlichen auf die Erhöhung des Finanzanlagevermögens zurückzuführen ist. Das Anlagevermögen hat sich im Geschäftsjahr 2021 auf € 1.246,7 Mio. erhöht (Vorjahr: € 372,3 Mio.) und ist im Wesentlichen auf die Einbringung von 46,5% Anteilen an der KTM AG in Höhe von € 895,0 Mio., die in Form einer Sachkapitalerhöhung durch Erhöhung des Grundkapital in Höhe von € 11,3 Mio. sowie Erhöhung der Kapitalrücklagen in Höhe von € 883,7 Mio., sowie auf die Aufstockung der Anteile an der KTM Technologies GmbH (vm. KTM E-Technologies GmbH) sowie der DealerCenterDigital GmbH zurückzuführen ist. Das Umlaufvermögen hat sich im Geschäftsjahr 2021 auf € 76,6 Mio. erhöht (Vorjahr: € 9,9 Mio.) und ist im Wesentlichen auf die Erhöhung der Forderungen gegenüber verbundenen Unternehmen zurückzuführen. Die liquiden Mittel haben sich gegenüber dem Vorjahr um € 11,4 Mio. erhöht. Die Forderungen gegenüber verbundenen Unternehmen betragen zum Stichtag € 58,0 Mio. (Vorjahr: € 2,8 Mio.) und betreffen im Wesentlichen Forderungen aus Dividendenanspruch, Finanzierungsforderungen sowie Forderungen aus laufenden Verrechnungen und sonstigen Forderungen. Das Eigenkapital hat sich erhöht und beträgt zum Stichtag € 1.281,3 Mio. (Vorjahr: € 327,6 Mio.). Die Eigenkapitalquote beträgt 96,58% und liegt somit auf einem sehr hohen Niveau. Die Verbindlichkeiten haben sich im abgelaufenen Geschäftsjahr reduziert und lagen zum 31.12.2021 bei € 42,8 Mio. (Vorjahr: € 56,5 Mio.). Die Reduktion der Verbindlichkeiten resultiert im Wesentlichen aus dem Ausgleich der Kaufpreisverbindlichkeit im Zusammenhang mit dem Erwerb der 40% Anteile an der PEXCO GmbH, der Geschäftsjahres 2020 stattgefunden hat. Von den kurz- und langfristigen Verbindlichkeiten betreffen € 6,0 Mio. (Vorjahr: € 6,0 Mio.) Schuldscheindarlehen, € 30,0 Mio. (Vorjahr: € 30,0 Mio.) Namensschuldverschreibungen, € 1,2 Mio. (Vorjahr: € 1,2 Mio.) Verbindlichkeiten aus Lieferungen und Leistungen, € 4,6 Mio. (Vorjahr: € 18,2 Mio.) Verbindlichkeiten gegenüber verbundenen Unternehmen sowie € 1,0 Mio. (Vorjahr: € 1,0 Mio.) sonstige Verbindlichkeiten.

C. Mitarbeiter

Im Jahresdurchschnitt beschäftigte die Gesellschaft 1 (Vorjahr: 16) MitarbeiterInnen.

Beilage II/2

PIERER Mobility AG – Haupttätigkeit

Unternehmen

Die PIERER Mobility-Gruppe ist Europas führender 2-Wheel-Hersteller (PTW). Mit ihren Motorradmarken KTM, HUSQVARNA Motorcycles und GASGAS zählt sie insbesondere bei den Premium-Motorrädern zu den europäischen Technologie- und Marktführern. Das Produktportfolio der PIERER Mobility-Gruppe umfasst neben Fahrzeugen mit Verbrennungsmotoren auch emissionsfreie Zweiräder (insbesondere E-Motorcycles und E-Bicycles). Als Pionier in der Elektromobilität für Zweiräder hat die Gruppe mit ihrem strategischen Partner Bajaj die Voraussetzungen geschaffen, eine global führende Rolle im Niedervoltebereich (24-48 Volt) einzunehmen. Der Einstieg in die (E-)Bicycle-Sparte mit der PIERER E-Bikes GmbH war ein weiterer wichtiger Schritt, um die Aktivitäten auch im Bereich der Fahrrad-Elektromobilität zu intensivieren. Die Fahrräder werden unter den Marken HUSQVARNA E-Bicycles, R Raymon sowie GASGAS E-Bicycles vertrieben und ab 2025 auch unter der Marke FELT Bicycles, um am attraktiven Marktwachstum in diesem Segment zu partizipieren und sich in diesem Bereich zu einem bedeutenden internationalen Player zu entwickeln.

Seit dem 17. November 2017 sind die Aktien der PIERER Mobility AG im International Reporting Standard der SIX Swiss Exchange primärotiert. Am 27. März 2017 wurden die Aktien der PIERER Mobility AG in den Swiss Performance Index (SPI) der SIX Swiss Exchange aufgenommen. Seit dem 01. März 2020 notieren die Aktien der PIERER Mobility AG auch im regulierten Markt der Frankfurter Wertpapierbörse (General Standard). Ab 1. März 2021 ist zusätzlich die Handelsaufnahme im Prime Market der Wiener Börse erfolgt, womit die Aktien der PIERER Mobility AG im Top-Segment der Wiener Börse gelistet sind. Mit diesem Schritt soll dem
großen Investoreninteresse im In- und Ausland begegnet werden.

Absatz- und Umsatzentwicklung im Geschäftsjahr 2021

Trotz höchster Herausforderungen in den internationalen Lieferketten und den Risiken aus der COVID-19 Pandemie verbesserte die PIERER Mobility-Gruppe den Umsatz um rund 14% und erzielte einen Rekordumsa t von € 2.031,5 Mio. (Vorjahr: € 1.788,0 Mio.). Mit 665.774 verkauften Motorrädern der Marken KTM, HUSQVARNA und GASGAS (Vorjahr: 570.705) hat PIERER Mobility, angetrieben durch die hohe globale Nachfrage nach Motorrädern, einen Absatzplus von 16% erreicht. Des Weiteren konnte die Fahrrad-Division mit den Marken HUSQVARNA, R RAYMON und GASGAS ein Absatzwachstum von mehr als 70% erzielen und 101.683 Fahrräder (Vorjahr: 59.277) verkaufen, davon 75.175 E-Bicycles (Vorjahr: 28.377).

In Europa lagen die Absätze an die Händler bei 150.000 Motorräder und 101.767 Fahrrädern. Knapp zwei Drittel der Motorräder (211.865 Stk.) wurden in den Märkten außerhalb Europas, und hier insbesondere in Nordamerika, Indien und Australien, verkauft. Die Umsetzung der globalen Produktstrategie sowie die Expansion in weitere asiatische und südamerikanische Märkte wurden im abgelaufenen Geschäftsjahr konsequent weiterverfolgt.

Ein ähnliches Bild wie im Wholesale spiegelt sich im internationalen Retail-Marktumfeld wider, wobei hier der europäische Motorradmarkt um ca. 8% auf 270.000 Stk. gewachsen ist. Der Marktanteil aller drei Motorradmarken liegt somit im Jahr 2021 bei 11,8%. Ebenfalls positiv entwickelten sich sowohl der amerikanische als auch der australische Markt, mit jeweils deutlich zweistelligen Marktanteilswerten von 11,6% bzw. 17,6%. Der indische Gesamtmotorradmarkt befindet sich leicht im Aufschwung ( ca. 4%). Bajaj setzte in Indien rund 70.000 KTM
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COVID-19-Pandemie

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Beilage II/5

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Following results, the following can be derived. Thus, the management has taken the hitherto recorded successes in the retail business for granted in all relevant discount markets. The effects of the outbreak of the COVID-19 pandemic were already recognized by management in 2021. K20 reacted proactively through national regulatory measures to contain the COVID-19 crisis and fully implemented them. Production continued throughout 2021 and without any immediate restrictions due to the COVID-19 pandemic, so that motorcycle sport and marketing activities also increased again significantly. The lockdown measures at the end of 2021 had only a minor impact, production could be maintained and through the extension of the home office regulations, a reduction in the risk of infection was achieved and thus a reduction of the risk of infection. The replacement part supply for end customers was guaranteed at all times. Temporary postponements in investment and development projects, as were still pending in the past year, could be avoided in 2021. The liquidity situation developed very pleasingly according to the business development. In addition to the issuance of a promissory note in the amount of €30 million in May 2021, the liquidity situation was sustainably strengthened through the assumption of a loan from the European Investment Bank in the amount of €80 million. Supported by the positive development of the retail outlets and the consistently pursued working capital optimizations established in previous years, a free cash flow in the amount of €155.1 million (previous year: €178.4 million) could be generated. Net debt was further reduced by €111.8 million to €177.7 million (previous year: €289.5 million).

To minimize the risk from the COVID-19 pandemic and to ensure the maintenance of production capacities, a comprehensive prevention concept was already developed in 2021, which is oriented towards the imposed regulatory measures and implements them. In order to protect the health of employees, various further protective measures were taken. These include distance regulations, regular disinfection of workplaces, as well as hygiene measures and access restrictions depending on the status as infected, recovered or negative tested. Due to the good experience with the home office offer, this was flexibly maintained. In addition, employees were offered a comprehensive COVID-19 vaccination offer, which was consistently maintained throughout the business year and was in high demand by employees.

ECONOMIC ENVIRONMENT AND MARKET DEVELOPMENT

The SARS-CoV-2 epidemic, known since the end of December 2019 and particularly prevalent in all countries of the world since March 2020, has an ongoing impact on economic activity from a global perspective. Governments worldwide have taken measures that have seized, to curb or to prevent the spread and to mitigate the economic consequences of these infection-imposed measures. Not only setbacks in the fight against the pandemic give cause for concern, but also the resulting bottlenecks in resources in the supply chains, as well as rising or stagnating inflation rates. The global economic situation is characterized by greater uncertainty, and the existing burdens in the context of economic recovery have increased, especially in connection with the course of the pandemic and access to raw materials. The current restrictions of the International Monetary Fund (IMF) from January 2022 are characterized by the same greater uncertainty.

According to this, global economic output is expected to grow by 4.4% in 2022. For industrial countries, growth of 3.6% is forecast for 2022 and 1.5% for the year 2023. For the Eurozone, growth of 3.6% is expected for 2022. For the year 2023, the IMF forecasts global growth of 2.7%, while for the Eurozone growth of 1.8% is expected. For developing and emerging countries, growth of the economic output of 4.4% for the year 2022 and 4.0% for the year 2023 is expected. For China, growth of 4.8% for 2022 and of 5.5% for 2023 is forecast. For India, a positive development of economic performance of 7.0% for 2022 and of 7.1% for 2023 is also expected.

In the past fiscal year 2021, PIERER Mobility Group was able to confirm the strong registration figures of the previous year and to maintain the global registrations at a high level. The market field of the motorcycle market lagged behind in comparison to 2020 by approx. 7%.

In Europe¹, the motorcycle market grew to a volume of approx. 2,700,000 new registrations by 31.12.2021, which corresponds to a plus of 7%. The market share of two-wheeler brands of KTM, Husqvarna and GASGAS is 11.8%. While Italy (-13%) and France (-11%) recorded declines both in the overall market and in the group's registrations (Italy: -15%, France: -10%), motorcycle demand in Germany, one of the largest relevant markets for the group in Europe, declined by 7%. In the USA³, the largest single motorcycle market for PIERER Mobility, the motorcycle market picked up on the positive growth of the previous year and recorded 2021 a volume of around 1,100,000 motorcycles (previous year: 1,070,000) with a plus of 10%. The three motorcycle markets of the PIERER Mobility Group together show a further significantly increased market share of 11.6% (previous year: 11.7%). The dynamic in Canada is similar to that with a plus of 10% in the motorcycle market, which corresponds to a market share of 17.1% for the business year 2021 (previous year: 17.8%).

Despite prolonged lockdowns in Australia, this market is also experiencing strong gains, both in its entirety referring to the motorcycle market (2021: 75,000 units vs. previous year: 71,000) and for the products of KTM, Husqvarna and GASGAS (2021: 16.7% vs. previous year: 10.7%), which results in a market share of 17.6% (previous year: 20.7%).

The e-mobility market holds great growth potential. E-Bicycles stand for a healthy, sustainable and individual form of mobility. They are an increasingly important component of modern mobility concepts. The popularity of e-Bicycles is growing dynamically and has now captured all model groups in the automotive sector. E-Bicycles enable longer distances, as well as higher average speeds and open up new mobility options in cities and in the country. It is recognizable that high-quality products are also establishing themselves in the bicycle market. The consumer shows himself to be quality- and environmentally conscious, which leads to a higher demand in the bicycle market - a proven trend, especially based on data for the German sales market, which according to new scientific knowledge depends not only on the changing population structure, but also on the generally increasing environmental awareness.

According to reports from the German Two-Wheeler Industry Association (ZIV), 4.03 million units (e-Bicycles and non-e-Bicycles) were sold in Germany in 2020, a sales increase of 15.6% compared to the previous year. With a decline of 7.5% in conventional bicycles, the strong growth resulted primarily from the e-Bicycle segment. In a report for the first half of 2021, the ZIV confirms these positive trends for the e-Bicycle market, while the forecast decline in sales figures for bicycles overall is attributed solely to the decline in conventional bicycles.

Year	Total Units Sold (E-Bicycles & Non-E-Bicycles)	Change vs. Previous Year
2020	4.03 million	15.6%
2021 (Forecast)	-	-7.5% (for conventional bicycles)

Segment	2021 Sales (Euros)	Previous Year Sales (Euros)	Change vs. Previous Year
Conventional Bicycles	Not specified	Not specified	-7.5%
E-Bicycles	Not specified	Not specified	Strong Growth

FINANZIELLE LEISTUNGSINDIKATOREN

ERTRAGSKENNZAHLEN

ERTRAGSKENNZAHLEN	2020	2021
V'fA. IN € Mio.
Umsatz	1.960.7	2.027.6
Betriebsergebnis vor Abschreibung (EBITDA) in € Mio.	266.8	221.5
EBITDA-Marge in %	13.6%	10.9%
Ergebnis der betrieblichen Tätigkeit (EBIT) in € Mio.	174.5	135.8
EBIT-Marge in %	8.9%	6.7%

WEITERE FINANZKENNZAHLEN

ERTRAGSKENNZAHLEN	2020	2021
Ergebnis nach Steuern in € Mio.	121.8	93.0
Ergebnis nach Minderheiten in € Mio.	27.7	15.8

BILANZKENNZAHLEN

BILANZKENNZAHLEN	2020	2021
V'fA. in € Mio.	1.577.0	1.622.7
Eigenkapital in € Mio.	787.1	758.5
Eigenkapitalquote in %	50.0%	46.8%
Working Capital Employed ¹ in € Mio.	151.8	140.8
Nettoverschuldung ² in € Mio.	215.7	181.7
Gearing ³ in %	27.4%	23.9%

CASH-FLOW UND INVESTITIONEN

CASH-FLOW UND INVESTITIONEN	2020	2021
V'fA. in €
Cash-Flow aus Betriebstätigkeit in € Mio.	215.8	250.7
Cash-Flow aus Investitionstätigkeit in € Mio.	-160.0	-118.1
Free Cash-Flow ⁴ in € Mio.	198.7	132.5
Cash-Flow aus Finanzierungstätigkeit in € Mio.	-107.0	-130.5
Investitionen ⁵ in € Mio.	150.5	127.8

WERTSCHEFKUNG

WERTSCHEFKUNG	2020	2021
ROE ¹ in %	12.6%	10.7%
ROE (Return on Equity) ² in %	13.0%	11.0%
ROIC ³ (Return on Invested Capital)	10.8%	7.7%

¹ Working Capital Employed: Vorräte + Forderungen aus Lieferungen und Leistungen - Verbindlichkeiten aus Lieferungen und Leistungen
² Nettoverschuldung: Finanzverbindlichkeiten (kurzfristig, langfristig) - Zahlungsmittel
³ Gearing: Nettoverschuldung / Eigenkapital
⁴ Free Cash-Flow: Cash-Flow aus Betriebstätigkeit - Cash-Flow aus Investitionstätigkeit
⁵ Investitionen: ZUgänge von Sachanlagen und immateriellen Wertewerten laut Anlagespiegel; ohne LeasingzUgänge (IFRS 16) i.H.v. 17.5 Mio. (Vorjahr: 18.8 Mio.)
⁶ ROE: EBIT / durchschnittliches Capital Employed; Capital Employed = Sachanlagen + Firmenwert + Immaterielle Wertwerte + Working Capital Employed
⁷ ROE: Ergebnis nach Steuern / durchschnittliches Eigenkapital
⁸ ROIC: EBIT / durchschnittliches Capital Employed; NOpAT = EBIT - Steuern

Beilage II/9

GESCHEnTSWickLUNG UND ANALYSE DER ERTRAGSKENNZAHLEN

Die PIERER Mobility-Gruppe blickt auf ein neues Rekordjahr 2021 zurück. Die größten Herausforderungen für die erfolgreiche Fortsetzung des Wachstumskurses waren die instabilen internationalen Lieferketten, die möglichst flexible Sicherstellung der erforderlichen Produktionskapazitäten und die Minimierung der Risiken aus der COVID-19-Pandemie für die Mitarbeiter. Aufgrund der hohen Marktnachfrage nach Powered Two-Wheelers (PTWs) und durch ein aktives Management der genannten Herausforderungen erzielte die PIERER Mobility-Gruppe trotz herausfordernder Rahmenbedingungen sowohl umsatz- als auch ergebnisseitig ein Rekordwachstum im Jahr 2021.

Im Geschäftsjahr 2021 erzielte die PIERER Mobility-Gruppe Umsatzerlöse in Höhe von € 2.027,6 Mio. (– 22.7%) und verbesserte damit den Umsatz um € 50,7 Mio. zum Vorjahr. Rund 88% der Umsatzerlöse wurden außerhalb Österreichs erzielt. Regional betrachtet entfielen 55.3% des Umsatzes auf Europa (– 1.5 Prozentpunkte zum Vorjahr), 11.8% auf Nordamerika inkl. Mexiko (– 1.8 Prozentpunkte zum Vorjahr) und 21.1% auf den Rest der Welt (– 2.7 Prozentpunkte zum Vorjahr).

Aufgrund der weltweit hohen Nachfrage nach Motorrädern und E-Bikes wurden im abgelaufenen Geschäftsjahr insgesamt 195.3 Mitarbeiter aufgebaut, sodass der Mitarbeiterstand zum Jahresende 3.178 betrug. In Österreich werden davon 1.340 Mitarbeiter beschäftigt.

Das operative Ergebnis vor Abschreibungen (EBITDA) liegt mit € 221,5 Mio. um rund € 100 Mio. über dem Vorjahreswert von € 266,8 Mio. Die EBITDA-Marge beläuft sich auf 10.9%. Die Unternehmengruppe steigerte das EBITDA um rund 20% auf € 135,8 Mio. (Vorjahr: € 174,5 Mio.), was einer EBIT-Marge von 6.7% entspricht.

Zudem konnte das Ergebnis nach Steuern mehr als verdoppelt werden und erreichte im Geschäftsjahr 2021 € 93,0 Mio. (Vorjahr: € 121,8 Mio.).

Die Absatzahlen von PTWs – Motorräder der Marken KTM, Husqvarna Motorcycles und GASGAS sowie E-Bikes (exklusive Non-E-Bikes) – verteilen sich wie folgt:

MOTORCYCLES

Die noch in 2020 aufgrund von Produktionsunterbrechungen verzeichneten Umsatzusfälle, bedingt durch die COVID-Pandemie, konnten im Geschäftsjahr 2021 aufgeholt und der Gesamtumsatz deutlich gesteigert werden.

In der KTM-Gruppe konnte im abgelaufenen Geschäftsjahr ein Umsatz von € 1.525,7 Mio. erzielt (Vorjahr: € 1.717,0 Mio.), was einem Umsatzplus von 21.6% entspricht. KTM erzielte im Geschäftsjahr 2021 ein EBITDA von € 125,5 Mio. (– 77.1% im Vergleich zum Vorjahr) und ein EBIT von € 85,3 Mio. (– 74.1% im Vergleich zum Vorjahr). Dies entspricht einer EBITDA-Marge von 10.9% (Vorjahr: 13.0%) und einer EBIT-Marge von 5.6% (Vorjahr: 5.7%). Das Ergebnis nach Steuern beläuft sich auf € 51,1 Mio. (Vorjahr: € 121,8 Mio.).

In Nordamerika verzeichnete KTM ein Umsatzwachstum von 17.8% auf € 755,1 Mio. Damit wurden 17.8% des Umsatzes in Nordamerika erzielt (Vorjahr: 15.7%). In Europa stieg der Umsatz gegenüber dem Vorjahr um 14.1% auf € 435,8 Mio., was einem Anteil von 26.6% entspricht (Vorjahr: 25.0%). Auch in den übrigen Ländern konnte der Umsatz gegenüber dem Vorjahr um 22.1% auf € 335,7 Mio. gesteigert werden.

Der Umsatzanteil in den übrigen Ländern beträgt 12.8% (Vorjahr: 11.8%).

Mit 177.700 verkauften KTM Motorrädern, 70.300 verkauften HUSQVARNA Motorrädern und 11.600 verkauften GASGAS Motorrädern im Geschäftsjahr 2021 hat die KTM-Gruppe insgesamt 259.600 Motoren (– 4.7% zum Vorjahr; unter Berücksichtigung der in Indien und Indonesien von Partner Bajaj verkauften Motoren) abgesetzt und festigte dadurch mit den drei Motorradmarken ihre Präsenz in den wichtigen Motorradabsatzmärkten. In den Vertriebsregionen von Europa lag der Absatz bei 120.007 Motorrädern (– 4.6%). Signifikante Zuwächse verzeichneten auch die nordamerikanische Vertriebstochter mit 76.625 abgesetzten Motorrädern (– 4.7%), und in Australien konnte der Absatz um 18.0% auf 10.771 gesteigert werden. Die stärksten Wachstumspotentiale zeigten sich in Südamerika (– 15.8%) mit 21.875 und in Asien (– 18.8%) mit 17.376 verkauften Motorrädern.

Im Geschäftsjahr 2021 wurden am Produktionsstandort Mattighofen 167.775 Motorräder produziert. Im Vergleich zum Vorjahr entspricht dies einer Steigerung von 30.700 Stück oder 18.3%. Unter Berücksichtigung der von unserem Partner Bajaj Auto Ltd. in Indien produzierten klemotoriigen KTM- und Husqvarna-Modelle sowie der in Spanien produzierten GASGAS-Trials wurden weltweit 231.764 Fahrzeuge (– 10.1%) produziert.

E-BICKYLES

In der Fahrrad-Division stand in 2021 die Etablierung der drei Marken Husqvarna E-Bicycles, R Raymon und GasGas sowie die technische Weiterentwicklung und Qualitätsteigerung des Produktportfolios im Vordergrund der Aktivitäten. R RAYMON bietet sowohl Fahrer als auch E-Bikes für unterschiedliche Zielgruppen: von Kinderrädern bis hin zu Rennrädern, von City-E-Bikes bis hin zu sportlichen E-MTBs. Die Produktpalette von Husqvarna umfasst heute die gesamte Bandbreite in Sachen E-Mobility. Im April 2021 wurden GASGAS-Fahrräder offiziell eingeführt. Die spanische Eigenmarke schlug ein neues Kapitel im Bereich der E-Mobility auf und soll noch mehr Offroad-Enthusiasten Zugang zum gemeinsamen Fahrspaß im Gelände verschaffen. Mit den verschiedenen Marken und dem damit noch breiter gestreuten Produktportfolio wird es möglich sein, diesen stark differenzierten Markt optimal bedienen zu können. Die weltweite COVID-19-Pandemie hat den Wunsch der Konsumenten nach Lösungen im Bereich Individualverkehr und E-Sport verstärkt. Darüber hinaus rücken die Berücksichtigung von Nachhaltigkeitsgedanken das Bedürfnis nach emissionsfreier Fortbewegung stärker in den Fokus von Konsumenten. Dabei erweisen sich insbesondere E-Bikes als besonders beliebt und attraktiv für Kunden. Die PIERER E-Bikes-Gruppe konnte dies nutzen, sich mit ihren Marken auf einem stark umkämpften Markt behaupten und ihren Wachstumskurs fortsetzen.

Im Geschäftsjahr 2021 konnte im E-Bicycles-Segment ein Umsatz in Höhe von € 151,6 Mio. erzielt (Vorjahr: € 111,8 Mio.). Dies bedeutet ein Umsatzplus von knapp 36% im Jahresvergleich. Das EBITDA lag in Beilage II/11 2021 bei € 11,7 Mio. (Vorjahr: € 5,8 Mio.) und das EBIT bei € 7,0 Mio. (Vorjahr: € 1,1 Mio.). Dies entspricht einer EBITDA-Marge von 7.7% (Vorjahr: 5.2%) und einer EBIT-Marge von 4.6% (Vorjahr: 1.0%).# URWHLO GHU 0LWDUEHLWHU DXV GHP )RUVFKXQJV- XQG (QWZLFNOXQJVEHUHLFK DXEIHLQHU 1XW]IOlFKH YRQ hEHU 20.000 m² angesiedelt ist. Mit dem Fokus auf den Leistungseereich von 250W bis 11kW setzt die Gruppe die nächsten Schritte, um die Forschung (Entwicklung (F&E) im Bereich der Elektromobilität zu intensivieren und verfolgt in voller Fahrt ihre Vision, weltweit führend im Bereich der elektrisch angetriebenen Zweiräder (PTW) zu werden. So wurden im Berichtsjahr alle F&E-Aktivitäten in einer eigenen Forschung- & Entwicklungsgesellschaft – der KTM Forschun ( (ntwicklung GmbH (KTM F&E GmbH) – gebündelt und weiter ausgebaut, um die stetig steigende Taktfrequenz der Technologieentwicklung weiter gewährleistet zu können. Ein besonderer Schwerpunkt des vergangenen Jahres war der Bezug des neu erschlossenen F&E-Standortes in Anif bei Salzburg, der neben dem Bereich der E-Antriebs-Entwicklung innerhalb der F&E GmbH auch der KTM Technologien GmbH Raum für weiteres Wachstum bietet. Das Investitionsvolumen in das 3.500 m² große Kompetenzzentrum für E-Mobilität beläuft sich auf EUR 20 Millionen. Die hochmoderne Einrichtung bietet mehr als 150 Mitarbeiter Platz und ist unmittelbar neben dem KISKA Designstudio in Anif bei Salzburg/Österreich, angesiedelt. Wir setzen im Jahr 2021 weitere Schritte auch bei der Entwicklung von Batterien. KTM beteiligt sich an Konsortium für Motorräder mit tauschbaren Akkumulatoren mit Honda Motor, Piaggio Gruppe und Yamaha Motor für Motorräder und leichte Elektrofahrzeuge. Das Konsortium wird in den kommenden 3 Jahren einen gemeinsamen technischen Standard für ein Batterie-Wechselsystem inkl. der entsprechenden Batterie-Tauschstationen erarbeiten.

Der Forschungs- & Entwicklungsbereich der PIERER E-Bikes GmbH ist in dezentralen Standorten in Europa (Österreich, Deutschland, Spanien) organisiert. Dies ermöglicht eine spezifische Antwort auf die Mobilitätsbedürfnisse der jeweiligen Märkte, sei es die urbane Mobilität in München und Barcelona oder die Offroad bzw. Dual Sport Community im ländlichen bis alpinen Raum rund um Schweinfurt, Salzburg und Munderfing.

Beilage II/15

2021 setzen alle drei Motorradmarken mit innovativen Erneuerungen und neuen Modellen, sowohl im Straßen- als auch im Offroadsegment ein klares Statement.

Zu den wichtigsten Projekten des vergangenen Jahres zählt auf Seite der Street-Modellplattformen die Industrialisierung der Speerspitzen im Street-Modellportfolio von KTM – der 1290 SUPER ADVENTURE R und S Modellen sowie des Hyper-Naked-Bikes 1290 SUPER DUKE RR.

Die KTM 1290 SUPER ADVENTURE S der Generation 2021 verfügt erstmals serienmäßig über eine innovative adaptive Geschwindigkeitsregelanlage. Diese wurde in intensiver Forschungsarbeit gemeinsam mit Bosch entwickelt. Sie sorgt mittels Radarsensoren automatisch für die Wahrung eines angemessenen Abstandes zu anderen Verkehrsteilnehmern und kann über den neu gestalteten Kombischalter in fünf Stufen eingestellt werden.

Weitere Highlights stellen die Serienproduktion der KTM RC Generation im Supersportsegment, der Serienhochlauf der HUSQVARNA Norden 901 sowie der Hochlauf der mit weiterführenden Updates versehenen Modelle KTM 1290 SUPER DUKE R und KTM 1290 SUPER DUKE GT dar.

Den Anfang machte das auf der Reihenzylinder-Mittelklasse-Plattform basierende Modellderivat KTM 890 DUKE, dessen Serienstart vor Beginn der Motorradsaison im Februar 2021 stattfand. Mit der 890 DUKE rundet KTM die Naked-Bike-Palette ab und bietet damit einen direkten Nachfolger der äußerst populären 790 DUKE, bei denen die Entwickler insonderheit bei Mechanik und Performance als auch hinsichtlich des Emissionsverhalten signifikante Fortschritte erzielten konnten.

2020 stellte HUSQVARNA Motorcycles den „Norden“ genannten Prototyp eines Motorrads im Mittelklasse-Travel-Segment vor. Exakt zwei Jahre nach dessen Präsentation stand im November 2021 sein Serienhochlauf an. In seinen Grundzügen auf dem Plattform-Backcasten der KTM 890 ADVENTURE basierend, differenziert sich das Modell durch sein eigenständiges Design, ein überarbeitetes Fahrwerk und eine Reihe markentypischer Detaillösungen deutlich von seinen Konzernschwestern.

Mit der SVALPILEN 125 erweiterte Husqvarna das Portfolio der Naked Bikes und bietet jungen Fahrern einen perfekten Einstieg in die Welt der Husqvarna Straßenmotorräder.

Zusammen mit Husqvarna Motorcycles stellte Husqvarna E-Bicycles auch seine Flotte von Urban-Mobility-Fahrzeugen vor, womit sich die Gruppe auf der IAA Mobility 2021 in München als holistischer, emissionsfreier Hersteller von motorisierten Zweirädern positionierte.

GASGAS

GASGAS Motorcycles bestätigte die weltweit Verfügbarkeit der neuesten TXT RALLY und TXT GP-Trial Modelle der MY 2021. Darüber hinaus hat GASGAS Motorcycles sein Angebot an Dirt Bikes um die kleidräftige MC 85, die MC 125 mit Zwei- und die MC 250F mit Viertaktmotor erweitert.

Einen weiteren Höhepunkt des abgelaufenen Forschungsjahres bildete die Entwicklung und der Start der Serienproduktionsüberleitung der neuen KTM SX / SX-F und HUSQVARNA TC / FC Motocross Modelle im Fullsize-Offroad-Segment. KTMs Marksleitsatz „Ready to Race“ folgend werden diese neben einer umfassenden Prototypen-Erprobung auch im Rahmen des weltweiten Motorsportsangements unter härtesten Bedingungen validiert und geprüft. Die jüngste Modellgeneration der Fullsize-Offroad-Plattform ist Ergebnis einer differenzierten Plattformstrategie, deren primäres Ziel es ist, die Performance aller verbauten Komponenten zu optimieren und gleichzeitig ein hohes Maß an Effizienz zu gewährleisten.

Die Forschungsabteilung arbeitet darüber hinaus intensiv an zukunftsträchtigen, nachhaltigen Mobilitätslösungen. Teil der verfolgten Strategie ist eine offene Herangehensweise mit unterschiedlichen Batterie-Lösungen, um sowohl die Vorteile von integrierten als auch entnehmbaren Batterien zu nutzen.

Das Forschungsjahr 2021 umfasste eine Reihe von F&E-Projekten im Bereich rein elektrisch angetriebener Fahrzeugkonzepte. Neben den großen Anstrengungen im Bereich der Grundlagen- und Technologieforschung wurden im vergangenen Jahr erstmals neue Fahrzeugkonzepte, das HUSQVARNA E-PILLEN-Konzept sowie das Elektroroller-Konzept HUSQVARNA BLITZ, der Öffentlichkeit vorgestellt.

Weiter bildete die KTM AG mit Honda Motor, der Piaggio Gruppe und Yamaha Motor ein Konsortium für Motorräder mit austauschbaren Akkumulatoren. Ziel des Konsortiums ist es, Lösungen für die Bedenken der Kunden in Bezug auf die Zukunft der Elektromobilität zu erarbeiten, z.B. hinsichtlich Reichweite, Ladezeit und Infrastruktur. Dies soll in Überstimmung mit vier Hauptzielen gewährleistet werden:

a) Entwicklung gemeinsamer technischer Spezifikationen für austauschbare Akkusysteme.
b) Bestätigung der gemeinsamen Nutzung der Akkusysteme.
c) Die gemeinsamen Spezifikationen des Konsortiums fördern und zum Standard machen.
d) Weltweite Anwendung der gemeinsamen Spezifikationen des Konsortiums.

Gemeinsam mit den Konsortialpartnern wird daran gearbeitet, ein austauschbares Akkusystem für Fahrzeuge im Niedervoltebereich (36 V) mit bis zu 11 kW Leistung zu entwickeln, das auf internationalen technischen Standards basiert.

Parallel zu den oben genannten Initiativen im Bereich der Elektromobilität arbeitet die KTM Gruppe auch an Technologien zur weiteren Reduktion des Emissionsverhaltens von Motorrädern, die mit Verbrennungsmotoren ausgestattet sind. Die Entwicklungsstrategie im Bereich der Verbrennungsmotorenentwicklung ist klar auf eine Verbrauchs- und Emissionsreduktion ausgerichtet. Dazu zählen F&E-Aktivitäten in Zusammenhang mit der Weiterentwicklung des thermodynamischen Systems (Kraftstoffeinspritzung, Verbrennung) als auch den Systemen zur Abgasnachbehandlung (Katalysatoren). Weiters werden Ansätze zur Verwendung von CO₂-freien bzw. CO₂-neutralen Kraftstoffen, die unter anderem aus dem in der Atmosphäre befindlichen CO₂ gewonnen werden, untersucht. Bereits jetzt sind alle Motoren in der Hubraumkategorie über 300 cm³ für den Betrieb mit synthetischen Kraftstoffen (e-Fuels) qualifiziert – weitere Motorenplattformen können innerhalb kurzer Reaktionszeiten umgestellt werden.

In den besonders technologiegetriebenen Rennen MotoGP und Moto2 wird darüber hinaus ab der Saison 2021 der Einsatz sogenannter blended fuels, bei denen 40 % des Kraftstoffes aus nicht fossilem Brennstoff besteht, erprobt. Ab der Saison 2026 ist aus heutiger Sicht in der Königsklasse der Motorrad-WM ein vollständiger Umstieg auf synthetische Kraftstoffe geplant.

E-BICYCLES

In der Fahrrad-Division stand in 2021 die Etablierung der drei Marken Husqvarna E-Bicycles, R Raymon und GASGAS sowie die technische Weiterentwicklung und Qualitätssteigerung des Produktportfolios im Vordergrund der Aktivitäten.

Die Husqvarna-Modellflotte erwartet für 2021 einige Neuheiten. Besonders hervorzuheben ist die neue Offroad-Modellsparte mit eigenem Rahmen-Design und technischen Neuerungen, verkörpert vor allem vom brandneuen Mountain Cross 7 (MC 7). Die MC 7 beweist, dass Husqvarna E-Bicycles die Themen Kinematik, Design und Technik ernst nimmt und richtet sich an eine neue Generation von Fahrern. Zusammen mit Husqvarna Motorcycles stellte Husqvarna E-Bicycles auch seine Flotte von Urban-Mobility-Fahrzeugen vor, womit sich die Gruppe auf der IAA Mobility 2021 in München als holistischer, emissionsfreier Hersteller von motorisierten Zweirädern positionierte.

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$5. Changing Business Environment and Risks

7. CHANCES AND RISKS

As Europe's foremost "Powered Two-Wheeler" Manufacturer (PTW), the PIERER Mobility Group with its motorcycle brands KTM, HUSQVARNA Motorcycles and GASGAS, counts among the European technology and market leaders. The business activity of the PIERER Mobility Group is marked by ongoing changes. The utilization of the changes resulting from these changes is the essential cornerstone of the success of the PIERER Mobility Group. To secure the future entrepreneurial success and utilization of the resulting changes, the Group must take on risks.

The management of changes and risks is the basis for adequately reacting to changes in political, economic, technical or legal framework conditions. Wherever it is foreseeable that the identified changes will result in risks, they are already incorporated in the statements in the Consignee and -lag report. The following sections contain possible future developments or events that could lead to a positive (Chances) or negative (Risks) deviation from the enterprise prognosis.

In the framework of risk management, all individual and cumulative risks that could jeopardize the success of the enterprise are overseen and managed. Existing risks are fundamentally avoided. The risk consolidation circle corresponds to the consolidation circle of the consolidation of the PIERER MOBILITY GROUP.

RISKMANAGEMENTSYSTEM

The main purpose of the risk management of the PIERER MOBILITY GROUP consists in the securing and strengthening of the enterprise through a proper and transparent implementation of the financial, operative and strategic risks. The board assumes together with the management of the essential consortium companies, especially of KTM AG, comprehensive steering and controlling tasks within the framework of an internally, all essential standards encompassing, integrated control system. The timely recognition, evaluation and reaction to strategic and operative risks is an essential component of the management activities of these entities and makes a substantial added value for the enterprise. Foundation for this are a unified and consortium-wide, on a monthly basis built-up reporting system and an ongoing oversight of the operative and strategic plans.

The PIERER MOBILITY GROUP possesses a multi-layered risk management system, whereby the consortium-wide risks are raised according to standards or geographical areas. The operative responsibility and the valuation of the consortium-wide risks are carried out by the risk management of KTM AG and the local management and are reported directly to the Board and overseen by them as well as by the Group Board.

A preventive analysis of potential or pending events is also the goal of risk management. In addition, it is also the task of risk management to actively steer risks and to evaluate corresponding measures with the affected business units.

RISKMANAGENENTSTRATEGIE

The PIERER MOBILITY GROUP orients itself within the framework of its risk management strategy on a risk analysis and risk valuation according to the COSO Framework. According to this, the Consortium has defined the following key areas of the risk management strategy:

The risk management implemented at the level of KTM AG regularly carries out risk analyses for selected production and distribution points. Only risks outside the Consortium Balance and the Consortium GUV are presented.

RISKMITIGATION

It is attempted to minimize, avoid or also consciously enter into risks in certain cases by means of corresponding measures, depending on the consequences for the enterprise.

RISKBEWERTUNG

The goal of risk valuation is the continuous, qualitative and quantitative valuation of all identified changes and risks for the prioritization of risk steering measures. The Chance- and Riskvaluation at the PIERER MOBILITY Group shall correspond to the following requirements:

Objectivity: The valuation should be carried out according to as objective criteria as possible.
Vergleichbarkeit: So that the chances and risks can be compared with each other, a quantitative valuation is carried out on the basis of uniformly defined values (if meaningful and possible).

BEWERTUNG METHODIK

Chances and individual risks are evaluated based on their probability of occurrence and their significance for the assets, finances and earnings basis of the Consortium. This valuation is based on information about

a) actually occurred risks in the past,
b) benchmarks from the industry or
c) self-created realistic expert estimations.

The quantitative valuation follows a scenario-oriented approach, whereby the following categories are distinguished: Best Case (BC), Most Likely Case (MLC), and Worst Case (WC). This is a classic three-cornered distribution. For individual risks, if necessary, an additional qualitative valuation can be used, or for fluctuating risks, alternative distributions (normal distribution, etc.) can be used. The choice of the respective distribution is dependent on the type of risk.

RISIKOEBERWACHUNG ( UND KONTROLLE )

The core point of operative risk management is the identification, evaluation and control of essential risks from the operative business. This process is especially carried out by the upper and middle management levels of KTM AG and is overseen by the Board of PIERER MOBILITY AG and the Consortium Board.

CHANCEN UND RISIKOBEIBTRAEGT

The following overview serves for the overall view over all identified risks and chances and shows their significance for the PIERER MOBILITY Group. As of the balance sheet date or at the time of the preparation of the closing of the accounts, the PIERER MOBILITY Group has not identified existing risks.

MARKRISIKEN

Konjunkturelles Risiko

The KTM-Group is predominantly active in the motorcycle branch and the PIERER E-Bikes-Group in the bicycle branch. The sales possibilities are determined by the general economic situation in the countries and regions in which the PIERER MOBILITY Group is represented. As the last years have shown, especially the motorcycle branch is cyclical and subject to strong demand fluctuations. Through corresponding market research and -forecasts, which are considered in the planning, the risk is counteracted. Due to the changed mobility behavior, the global motorcycle market is, as before, in upswing and registers in the most important sales regions in the year-on-year comparison clearly.

Wettbewerb und Preisdruck

Especially the motorcycle market in industrial states is characterized by intense competition, whereby the strongest competitors are four Japanese, three European and to a lesser extent an American manufacturer and many of them have larger financial resources, higher sales rates and market shares# ENVIRONMENTAL RISKS

In order to minimize environmental risks, further measures are taken. Each vehicle is checked for its functionality and compliance with all environmental standards based on its own test stands and a workforce dedicated to investigating the effects of wear and tear on humans and the environment. In addition, increasing focus is placed on the development of emission-free alternative drive systems and products.

Environmental risks arise in production through the occasional emission of substances, waste, and material residues on the premises. To prevent these, numerous measures are implemented, which include, for example, waste management concepts, a motorization-driven preparation system, emergency plans for each location, and professional disposal systems for metal shavings in designated containers. Emissions from the operation of test stands are also captured by disposal systems.

Environmental risks in procurement can arise from the scarcity and deterioration of resources, cooperation with suppliers without adequate environmental controls, and emissions from transport routes. To minimize these risks, measures are taken that include the inspection of suppliers, the optimization of procurement processes, and a high focus on regional procurement and the use of resource-saving, modern production technologies.

Furthermore, environmental risks arise from weather- and climate-related phenomena such as floods and other natural disasters. Although a complete exclusion of risks from natural events is not possible, an attempt is made to minimize the risk of disruption to production processes through appropriate emergency plans and insurance.

PERSONAL RISKS

In particular, in view of the growth trajectory, risks can arise from the departure of key employees from the company. With efficient personnel management and the consistent continuation of personnel development programs, the risk of departure of key employees is counteracted. The risk of a shortage of skilled workers is addressed, among other things, through a comprehensive training program in a dedicated training workshop. The goal is the recruitment of employees from the region and long-term commitment to the company.

Internal and external measures to increase the attractiveness of the employer are an essential component of conveying the aforementioned spirit of the PIERER Mobility Group to potential new employees. With diverse cross-media employee campaigns, the company was able to cover the personnel requirements in the reporting year to a large extent. In the area of TRAINING, not only a targeted approach to specific groups was taken, but also a dedicated department for the training of future trainees was created, in order to provide information about chances and opportunities at an early stage and to prevent uncertainty.

The PIERER Mobility Group has taken numerous measures to protect employees since the outbreak of the corona pandemic in Austria. Measures and regulations of the government were comprehensively and quickly implemented and, through the foresight of the working method and the consistent exchange with authorities, were often integrated into the daily operations of the company even before their legal obligation. Therefore, widespread dissemination within the company could be prevented.

NOTES ON THE GROUP - 2023 (10-K)

1. SHARE CAPITAL (SEC 1)

The share capital amounts to EUR 22,725,866. It is divided into 22,725,866 no-par value bearer shares with voting rights, whereby each share participates in the share capital to the same extent. The shares grant the shareholders the rights customary under Austrian stock corporation law. This includes the right to the distribution of dividends decided at the Annual General Meeting and the right to an increase in voting rights at the Annual General Meeting. The shares of PIERER Mobility AG have been listed on the SIX Swiss Exchange (SIX) in the International Reporting Standard since November 17, 2017 (ISIN AT0000KTMI65). In addition, the shares of PIERER Mobility AG have been listed on the regulated market of the Frankfurt Stock Exchange since March 6, 2020 (General Standard). Since March 1, 2021, the shares of PIERER Mobility AG are additionally listed on the Vienna Stock Exchange (Official Trading). In the fiscal year 2021, the Management Board of the company, with the approval of the Supervisory Board, decided to increase the share capital against contribution in kind of EUR 25,854,200. to EUR 26,658,866. – by EUR 6,658,866. – through the issuance of 11,582,751 new shares. The majority shareholder Pierer Bajaj AG contributed its stake in a volume of approx. 75% of the share capital of KTM AG into PIERER Mobility AG. The corresponding amendment to the Articles of Association was entered in the Commercial Register on October 21, 2021. In the fiscal year 2021, no own shares were acquired. On January 20, 2021, the share buyback program of PIERER Mobility AG was terminated prematurely. On January 11, 2021, the company decided to offer its own shares from February 1, 2021 onwards to selected institutional investors and/or strategic business partners for purchase. In the fiscal year 2021, a total of 166,670 own shares were sold. The change in the non-interest-bearing capital reserves from EUR 177.876.371,41 to EUR 717.775.205,81 resulted in EUR 1,357. 803.000.00 resulted on the one hand from the sale of 166,670 own shares and on the other hand from the capital increase in kind by 8.075,786 KMT AG shares through Pierer Bajaj AG (formerly: PTW Holding) AG.

2. PARTICIPATION AGREEMENT

On September 21, 2023, a syndicate agreement was concluded between Pierer Konzern Gesellschaft mbH, Pierer Industrie AG and Pierer Bajaj AG on the one hand (the "Pierer Group") and Bajaj Auto Ltd. and Bajaj Auto International Holdings B.V. on the other hand (the "Bajaj Group") (the "Syndicate Agreement 2023"), which regulates the rights and obligations of the two corporate groups with regard to the participation of Pierer Industrie AG and Bajaj Auto International Holdings B.V. in Pierer Bajaj AG as the majority shareholder of PIERER Mobility AG. The Syndicate Agreement 2023 provides that the management of Pierer Bajaj AG shall require the approval of the supervisory board members of Pierer Bajaj AG nominated by Bajaj, in the event of a transfer of ownership of shares in PIERER Mobility AG. Pierer Bajaj AG, which is economically attributable to Mr. Stefan Pierer, is therefore subject to, among other things, restrictions on change of control. The Management Board is not aware of any further restrictions affecting voting rights or the transfer of shares.

3. Ownership Structure

According to the company's knowledge, the following direct or indirect participations in PIERER Mobility AG, each of at least 10 percent, existed as of December 31, 2023:

Pierer Bajaj AG (formerly) PTW Holding AG: 26.25% (direct participation);
Pierer Industrie AG: 26.25% (indirect participation);
Pierer Konzern Gesellschaft mbH: 1.85% (direct participation) and 26.25% (indirect participation).

4. TREASURY SHARES

There are no employee participation models at present.

5. OTHER PROVISIONS

There are no provisions beyond the statutory provisions regarding the remuneration and dismissal of the members of the Management Board and the Supervisory Board and regarding the amendment of the Articles of Association.

6. POSSIBILITIES OF ISSUING OR REPURCHASING SHARES

At the Annual General Meeting on April 27, 2017, the following resolutions were passed:

a) The authorization of the Management Board with the approval of the Supervisory Board until 01.03.2025 to acquire financial instruments within the meaning of § 15a AktG, in particular, trade paper, profit transfer agreements and claims, with a total nominal amount of EUR 180,000,000.00, which may also involve the right of purchase and/or option to acquire shares in the company in whole or in part, in several tranches and in various combinations, and/or be structured in such a way that their exercise may result in the acquisition of equity capital.

b) For the conditions of the option and/or purchase rights, the Management Board may use the capital and/or own shares.

c) The amount and conditions of the financial instruments are to be determined by the Management Board with the approval of the Supervisory Board, whereby the issue price is to be determined according to the recognized financial mathematical methods and the course of the company's shares in a recognized price discovery process.

d) The Management Board is entitled, with the approval of the Supervisory Board, to exclude the option rights of shareholders to the financial instruments within the meaning of § 15a AktG.

e) The authorized increase of the company's share capital in accordance with § 185 Abs. 2 Z 1 AktG by up to EUR 25,000,000.00 through the issuance of up to 25,000,000 no-par value shares without nominal value (stock shares) for the benefit of transferees of financial instruments within the meaning of § 15a AktG, which are issued under the use of the authorization granted in this Annual General Meeting to the shareholders of the company, provided that the beneficiaries of the financial instruments exercise their option and/or purchase right to shares of the company, also in several tranches and in different combinations, with the issue amount and the option ratio to be determined according to the recognized financial mathematical methods and the course of the company's shares.# ILQDQPDWKHPDWLVFKHU 0HWKRGHQ VRZLH GHV $NWLHQNXUVHV LQ HLQHP DQHUNDQQWHQ 3UHLVILQGXQJVYHUIDKUHQ ]X HUPLWWHOQ

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The monitoring of the accounting and reporting process is carried out regularly and at least annually. The supervision of the content of the accounting regulations and controls lies in the responsibility of the respective management.

RISK DISCLOSURE

Risks relating to the accounting and reporting process are identified and supervised by management. The focus is placed on those risks that are typically considered essential. The essential risks in the area of accounting and reporting include the incomplete recording of financially relevant facts, errors in the booking process, as well as incorrect calculations. Complex accounting principles can lead to an increased risk of error, incorrect disclosure, and delayed financial statements. Furthermore, there is a risk of unauthorized access to personal data or data manipulation, system failures, and data loss.

For the preparation of the closing, regular valuations must be made, which carry the inherent risk that the future development of these valuations deviates from this. This applies in particular to the following facts/items of the Group financial statements: Social capital, proceeds from rights disputes, value of provisions, participations, and prepayments. External experts are partly consulted or public sources are used to minimize the risk of incorrect valuations.

CONTROLS

The PIERER Mobility Group has integrated its controls directly into the Group accounting process. An essential element, in addition to process-independent external control mechanisms, is the principle of functional separation. To ensure a complete, timely, and correct financial statement, quality assurance and control measures are implemented in all areas involved in the accounting process.

All control measures are applied in the ongoing business process to ensure that potential errors in financial reporting are prevented or detected and corrected. Furthermore, the application of internal guidelines leads to a uniform handling of business transactions as well as to uniform accounting and financial reporting. In the relevant IT systems with accounting relevance, controls are integrated that, among others, prevent the incorrect recording of business transactions, ensure the complete recording of business transactions, respectively, valuation of business transactions in accordance with accounting regulations, or support the supervision of consolidation. In view of the increasing demands on IT systems in accounting and the constantly increasing technical possibilities, the PIERER Mobility Group regularly carries out IT-supported analyses of the effectiveness of the established measures to identify and subsequently eliminate any arising control weaknesses.

Controls relating to IT security represent an essential element of the internal control system. Thus, the separation of sensitive activities is supported by a restrictive allocation of IT authorizations. Through the implemented ERP software, automated controls are carried out, e.g., automated controls for release and posting of accounting entries.

COMMUNICATION AND SUPERVISION

The responsibility for the effectiveness of the internal control system in the Group accounting process is clearly defined and lies with the responsible management and process owners. In assessing the effectiveness, in addition to the results from internal reviews, those from external audits, e.g., as part of the annual financial statement audit or external IT security audits, as well as the Supervisory Board and the Audit Committee, are included. Weaknesses in the control system are identified considering their potential impact on the accounting and reporting process.

In addition to the legally prescribed closings, which are made available to the management, an extensive internal reporting system has also been implemented in the Group, which is prepared and distributed in different aggregation levels depending on the reporting recipient.

Further central instruments of risk management and control are the company-wide guidelines on dealing with essential risks, the planning and controlling process, as well as the ongoing financial reporting. The guidelines include the determination and control of limits and transaction flows for the limitation of financial risks, as well as the strict requirement of the four-eyes principle for accounting and payment releases.

Furthermore, the internal control system is based on precise information about the processes for accounting and financial reporting and also includes the underlying company processes, e.g., order processing or logistics processes, with a view to their effectiveness. The management supervises the internal control system in such a way that the results, which are communicated to management in a summarized form, are analyzed, evaluated, and commented on by them.

The Management Board and the Audit Committee are informed annually about the application for the effectiveness of the internal control system in accounting. In case of significant changes in the effectiveness of the internal control system, an immediate reporting to the Management Board and, if applicable, to the Supervisory Board takes place, as well as the implementation of appropriate measures to increase effectiveness.

OUTLOOK

For the 2023 financial year, the Management Board forecasts renewed growth both in the two-wheelers and in the four-wheelers within the long-term bandwidth. However, challenges in international supply chains must still be expected in 2023, as capacity and delivery bottlenecks with individual suppliers and in international transport logistics can lead to delivery delays. Through intensive measures in the area of Supply Chain Management and high flexibility in production planning, it is attempted to recognize and minimize negative consequences promptly. Through the revised supplier pricing in the past year and the implemented program for the management of global events, which directly or indirectly affect the supply chains, the expected challenges and their consequences should be mitigated. Sales-wise, PIERER Mobility sees the market continuing to be positive. The growth should be driven primarily by the consistently high global demand and the trend towards ever more electric vehicles, especially in urban areas.

In line with the strategic objective of contributing to emission reduction and emission neutrality for two-wheelers, the focus in the coming years will increasingly shift to alternative drives in the area up to 15 kW. In the area above this, the technological further development of conventional drive forms with synthetic fuels for CO2 avoidance will be driven forward. The main goal is to fully exploit the innovation and development potential in the area of electromobility and, with E-fuel-powered vehicles as a global player with strong brands, to co-shape the growing market and secure market shares. By 2025, at least three electric platforms with multiple products will be introduced.

While the focus in 2023 in the motorcycle division is primarily on the broader establishment of the Husqvarna E-Bicycles and R5 models in European markets and the expansion of the dealer network in the core markets of Germany, Austria, and Switzerland (DACH), the acquisition of the FELT brand opens up a new spectrum of product, sales, and development opportunities. With FELT, the existing portfolio of bicycles has been significantly expanded, especially the sports racing segment, and enables stronger branding and positioning of all cycling products in the North American market. In addition to the DACH region, the North American market offers enormous growth and distribution potential for the sale of E-Bicycles. Furthermore, further expansion steps to the overseas markets of Australia and Southern Europe should be concentrated. Through the acquisition of the GASGAS brands in the E-Bicycle product portfolio and the expansion of E-Bicycle sales in the already existing motorcycle trade, the dynamic growth trend will be further driven forward.

In the 2023 financial year, the PIERER Mobility Group will continue to rely on growth in all core areas, both in the two-wheelers and in the four-wheelers, despite the existing challenges in the supply chain. The Management Board forecasts sales growth between 7% and 10% (FY 2023: EUR 1,031.1 million) with an EBIT margin of 8% to 10% and an EBITA margin between 18% and 20%.

Furthermore, PIERER Mobility AG lists its shares on the official trading of the Vienna Stock Exchange (segment prime market). The trading on the prime market, the top segment of the Vienna Stock Exchange, took place on March 1, 2023.

In addition, the geopolitical risks must also be kept in mind.,QVEHVRQGHUH GLH PLOLWlULVFKHQ $XVHLQDQGHUVHW]XQJHQ LQ GHU 8NUDLQH ZHUGHQ GLH :HOWZLUWVFKDIW QHJDWLY EHHLQIOXVVHQ. 'DV :HFKVHONXUVXPIHOG EOHLEW LQ GHQ IU 3,(5(5 0RELOLW\ ZLFKWLJHQ 5HJLRQHQ YRUDXVVLFKWOLFK YRODWLO.

Beilage II/29

kpmg

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021
11. März 2022

4. Bestätigungsvermerk

Bericht zum Jahresabschluss

Prüfungsurteil

Wir haben den Jahresabschluss der PIERER Mobility AG, Wels, bestehend aus der Bilanz zum 31. Dezember 2021, der Gewinn- und Verlustrechnung für das an diesem Stichtag endende Geschäftsjahr und dem Anhang, geprüft.

Nach unserer Beurteilung entspricht der Jahresabschluss den gesetzlichen Vorschriften und vermittelt ein möglichst getreues Bild der Vermögens- und Finanzlage zum 31. Dezember 2021 sowie der Ertragslage der Gesellschaft für das an diesem Stichtag endende Geschäftsjahr in Übereinstimmung mit den österreichischen unternehmensrechtlichen Vorschriften.

Grundlage für das Prüfungsurteil

Wir haben unsere Abschlussprüfung in Übereinstimmung mit der EU-Verordnung Nr 537/2014 (im Folgenden AP-VO) und mit den österreichischen Grundsätzen ordnungsgemäßer Abschlussprüfung durchgeführt. Diese Grundsätze erfordern die Anwendung der International Standards on Auditing (ISA). Unsere Verantwortlichkeiten nach diesen Vorschriften und Standards sind im Abschnitt "Verantwortlichkeiten des Abschlussprüfers für die Prüfung des Jahresabschlusses" unseres Bestätigungsvermerks weitergehend beschrieben.

Wir sind von der Gesellschaft unabhängig in Übereinstimmung mit den österreichischen unternehmens- und berufsrechtlichen Vorschriften und wir haben unsere sonstigen beruflichen Pflichten in Übereinstimmung mit diesen Anforderungen erfüllt.

Wir sind der Auffassung, dass die von uns erlangten Prüfungsnachweise bis zum Datum dieses Bestätigungsvermerkes ausreichend und geeignet sind, um als Grundlage für unser Prüfungsurteil zu diesem Datum zu dienen.

Besonders wichtige Prüfungssachverhalte

Besonders wichtige Prüfungssachverhalte sind solche Sachverhalte, die nach unserem pflichtgemäßen Ermessen am bedeutsamsten für unsere Prüfung des Jahresabschlusses des Geschäftsjahres waren. Diese Sachverhalte wurden im Zusammenhang mit unserer Prüfung des Jahresabschlusses als Ganzes und bei der Bildung unseres Prüfungsurteils hierzu berücksichtigt und wir geben kein gesondertes Prüfungsurteil zu diesen Sachverhalten ab.

kpmg

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021
11. März 2022

Werthaltigkeit der Anteile an verbundenen Unternehmen

Siehe Anhang „Bilanzierungs- und Bewertungsmethoden" sowie "Erläuterungen zur Bilanz“.

Das Risiko für den Abschluss

Die Anteile an verbundenen Unternehmen mit einem Buchwert in Höhe von 1.236 Mio EUR stellen rund 97 % des ausgewiesenen Vermögens im Jahresabschluss der PIERER Mobility AG dar. Für sämtliche bedeutsame Anteile an verbundenen Unternehmen beurteilt PIERER Mobility AG, ob Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert vorliegen. Liegen solche Anhaltspunkte vor, wird für das betroffene verbundene Unternehmen eine Unternehmensbewertung durchgeführt und der Buchwert der Anteile auf das Ergebnis der Unternehmensbewertung abgeschrieben.

Zum 31. Dezember 2021 hat PIERER Mobility AG für die Anteile an verbundenen Unternehmen keine Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert identifiziert.

Die Beurteilung, ob Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert vorliegen, erfordert Schätzungen und Ermessensentscheidungen des Managements. Für den Jahresabschluss besteht damit das Risiko, dass nicht angemessene Schätzungen und Ermessensentscheidungen dazu führen, dass Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert nicht identifiziert werden und Anteile an verbundenen Unternehmen in Folge nicht mit dem niedrigeren beizulegenden Wert angesetzt werden.

Unsere Vorgehensweise in der Prüfung

Wir haben die Werthaltigkeit der Anteile an verbundenen Unternehmen wie folgt beurteilt:

Wir haben die vom Unternehmen durchgeführte Analyse der Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert (einschließlich der Deckung des Beteiligungsansatzes durch das anteilige Eigenkapital) der Anteile an verbundenen Unternehmen nachvollzogen.
Zudem haben wir in Gesprächen mit dem Management erörtert, ob darüber hinausgehende Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert der Anteile an verbundenen Unternehmen vorliegen.
Weiters haben wir die vom Aufsichtsrat genehmigten Budgetzahlen und die vom Vorstand freigegebene Mittelfristplanung eingeholt und gewürdigt, ob diese mit den Schlussfolgerungen des Managements, wonach keine Anhaltspunkte für einen wesentlich gesunkenen beizulegenden Wert bestehen, im Einklang stehen.

kpmg

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021
11. März 2022

Verantwortlichkeiten der gesetzlichen Vertreter und des Prüfungsausschusses für den Jahresabschluss

Die gesetzlichen Vertreter sind verantwortlich für die Aufstellung des Jahresabschlusses und dafür, dass dieser in Übereinstimmung mit den österreichischen unternehmensrechtlichen Vorschriften ein möglichst getreues Bild der Vermögens-, Finanz- und Ertragslage der Gesellschaft vermittelt. Ferner sind die gesetzlichen Vertreter verantwortlich für die internen Kontrollen, die sie als notwendig erachten, um die Aufstellung eines Jahresabschlusses zu ermöglichen, der frei von wesentlichen falschen Darstellungen aufgrund von dolosen Handlungen oder Irrtümern ist.

Bei der Aufstellung des Jahresabschlusses sind die gesetzlichen Vertreter dafür verantwortlich, die Fähigkeit der Gesellschaft zur Fortführung der Unternehmenstätigkeit zu beurteilen, Sachverhalte im Zusammenhang mit der Fortführung der Unternehmenstätigkeit – sofern einschlägig – anzugeben, sowie dafür, den Rechnungslegungsgrundsatz der Fortführung der Unternehmens- tätigkeit anzuwenden, es sei denn, die gesetzlichen Vertreter beabsichtigen, entweder die Gesellschaft zu liquidieren oder die Unternehmenstätigkeit einzustellen oder haben keine realistische Alternative dazu.

Der Prüfungsausschuss ist verantwortlich für die Überwachung des Rechnungslegungsprozesses der Gesellschaft.

Verantwortlichkeiten des Abschlussprüfers für die Prüfung des Jahresabschlusses

Unsere Ziele sind hinreichende Sicherheit darüber zu erlangen, ob der Jahresabschluss als Ganzes frei von wesentlichen falschen Darstellungen aufgrund von dolosen Handlungen oder Irrtümern ist und einen Bestätigungsvermerk zu erteilen, der unser Prüfungsurteil beinhaltet. Hinreichende Sicherheit ist ein hohes Maß an Sicherheit, aber keine Garantie dafür, dass eine in Übereinstimmung mit der AP-VO und mit den österreichischen Grundsätzen ordnungsgemäßer Abschlussprüfung, die die Anwendung der ISA erfordern, durchgeführte Abschlussprüfung eine wesentliche falsche Darstellung, falls eine solche vorliegt, stets aufdeckt.

Falsche Darstellungen können aus dolosen Handlungen oder Irrtümern resultieren und werden als wesentlich angesehen, wenn von ihnen einzeln oder insgesamt vernünftigerweise erwartet werden könnte, dass sie die auf der Grundlage dieses Jahresabschlusses getroffenen wirtschaftlichen Entscheidungen von Nutzern beeinflussen.

Als Teil einer Abschlussprüfung in Übereinstimmung mit der AP-VO und mit den österreichischen Grundsätzen ordnungsgemäßer Abschlussprüfung, die die Anwendung der ISA erfordern, üben wir während der gesamten Abschlussprüfung pflichtgemäßes Ermessen aus und bewahren eine kritische Grundhaltung. Darüber hinaus gilt:

Wir identifizieren und beurteilen die Risiken wesentlicher falscher Darstellungen aufgrund von dolosen Handlungen oder Irrtümern im Abschluss, planen Prüfungshandlungen als Reaktion auf diese Risiken, führen sie durch und erlangen Prüfungsnachweise, die ausreichend und geeignet sind, um als Grundlage für unser Prüfungsurteil zu dienen. Das Risiko, dass aus dolosen Handlungen resultierende wesentliche falsche Darstellungen nicht aufgedeckt werden, ist höher als ein aus Irrtümern resultierendes, da dolose Handlungen kollusives Zusammenwirken, Fälschungen, beabsichtigte Unvollständigkeiten, irreführende Darstellungen oder das Außerkraftsetzen interner Kontrollen beinhalten können.

kpmg

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021
11. März 2022

Wir gewinnen ein Verständnis von dem für die Abschlussprüfung relevanten internen Kontrollsystem, um Prüfungshandlungen zu planen, die unter den gegebenen Umständen angemessen sind, jedoch nicht mit dem Ziel, ein Prüfungsurteil zur Wirksamkeit des internen Kontrollsystems der Gesellschaft abzugeben.
Wir beurteilen die Angemessenheit der von den gesetzlichen Vertretern angewandten Rechnungslegungsmethoden sowie die Vertretbarkeit der von den gesetzlichen Vertretern dargestellten geschätzten Werte in der Rechnungslegung und damit zusammenhängende Angaben.
Wir ziehen Schlussfolgerungen über die Angemessenheit der Anwendung des Rechnungslegungsgrundsatzes der Fortführung der Unternehmenstätigkeit durch die gesetzlichen Vertreter sowie, auf der Grundlage der erlangten Prüfungsnachweise, ob eine wesentliche Unsicherheit im Zusammenhang mit Ereignissen oder Gegebenheiten besteht, die erhebliche Zweifel an der Fähigkeit der Gesellschaft zur Fortführung der Unternehmenstätigkeit aufwerfen können. Falls wir die Schlussfolgerung ziehen, dass eine wesentliche Unsicherheit besteht, sind wir verpflichtet, in unserem Bestätigungsvermerk auf die dazugehörigen Angaben im Jahresabschluss aufmerksam zu machen oder, falls diese Angaben unangemessen sind, unser Prüfungsurteil zu modifizieren. Wir ziehen unsere Schlussfolgerungen auf der Grundlage der bis zum Datum unseres Bestätigungsvermerks erlangten Prüfungsnachweise.Zukünftige Ereignisse oder Gegebenheiten können jedoch die Abkehr der Gesellschaft von der Fortführung der Unternehmenstätigkeit zur Folge haben. — Wir beurteilen die Gesamtdarstellung, den Aufbau und den Inhalt des Jahresabschlusses einschließlich der Angaben sowie ob der Jahresabschluss die zugrunde liegenden Geschäftsvorfälle und Ereignisse in einer Weise wiedergibt, dass ein möglichst getreues Bild erreicht wird. — Wir tauschen uns mit dem Prüfungsausschuss unter anderem über den geplanten Umfang und die geplante zeitliche Einteilung der Abschlussprüfung sowie über bedeutsame Prüfungsfeststellungen, einschließlich etwaiger bedeutsamer Mängel im internen Kontrollsystem, die wir während unserer Abschlussprüfung erkennen, aus. — Wir geben dem Prüfungsausschuss auch eine Erklärung ab, dass wir die relevanten beruflichen Verhaltensanforderungen zur Unabhängigkeit eingehalten haben und uns mit ihm über alle Beziehungen und sonstigen Sachverhalte austauschen, von denen vernünftigerweise angenommen werden kann, dass sie sich auf unsere Unabhängigkeit und – sofern einschlägig – damit zusammenhängende Schutzmaßnahmen auswirken. — Wir bestimmen von den Sachverhalten, über die wir uns mit dem Prüfungsausschuss ausgetauscht haben, diejenigen Sachverhalte, die am bedeutsamsten für die Prüfung des Jahresabschlusses des Geschäftsjahres waren und daher die besonders wichtigen Prüfungssachverhalte sind. Wir beschreiben diese Sachverhalte in unserem Bestätigungsvermerk, es sei denn, Gesetze oder andere Rechtsvorschriften schließen die öffentliche Angabe des Sachverhalts aus oder wir bestimmen in äußerst seltenen Fällen, dass ein Sachverhalt nicht in unserem Bestätigungsvermerk mitgeteilt werden sollte, weil vernünftigerweise erwartet wird, dass die negativen Folgen einer solchen Mitteilung deren Vorteile für das öffentliche Interesse übersteigen würden.

kpmg P

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021
11. März 2022

Sonstige gesetzliche und andere rechtliche Anforderungen

Bericht zum Lagebericht

Der Lagebericht ist aufgrund der österreichischen unternehmensrechtlichen Vorschriften darauf zu prüfen, ob er mit dem Jahresabschluss in Einklang steht und ob er nach den geltenden rechtlichen Anforderungen aufgestellt wurde.

Die gesetzlichen Vertreter sind verantwortlich für die Aufstellung des Lageberichts in Übereinstimmung mit den österreichischen unternehmensrechtlichen Vorschriften.

Wir haben unsere Prüfung in Übereinstimmung mit den Berufsgrundsätzen zur Prüfung des Lageberichts durchgeführt.

Urteil

Nach unserer Beurteilung ist der Lagebericht nach den geltenden rechtlichen Anforderungen aufgestellt worden, enthält die nach § 243a UGB zutreffenden Angaben, und steht in Einklang mit dem Jahresabschluss.

Erklärung

Angesichts der bei der Prüfung des Jahresabschlusses gewonnenen Erkenntnisse und des gewonnenen Verständnisses über die Gesellschaft und ihr Umfeld haben wir keine wesentlichen fehlerhaften Angaben im Lagebericht festgestellt.

Zusätzliche Angaben nach Artikel 10 AP-VO

Wir wurden von der Hauptversammlung am 29. April 2021 als Abschlussprüfer gewählt und am 29. September 2021 vom Aufsichtsrat mit der Abschlussprüfung der Gesellschaft für das am 31. Dezember 2021 endende Geschäftsjahr beauftragt. Wir sind ohne Unterbrechung seit dem Jahresabschluss zum 31.12.2014 Abschlussprüfer der Gesellschaft.

Wir erklären, dass das Prüfungsurteil im Abschnitt "Bericht zum Jahresabschluss" mit dem zusätzlichen Bericht an den Prüfungsausschuss nach Artikel 11 der AP-VO in Einklang steht.

Wir erklären, dass wir keine verbotenen Nichtprüfungsleistungen (Artikel 5 Abs 1 der AP-VO) erbracht haben und dass wir bei der Durchführung der Abschlussprüfung unsere Unabhängigkeit von der geprüften Gesellschaft gewahrt haben.

kpmg P

PIERER Mobility AG, Wels
Bericht über die Prüfung des Jahresabschlusses zum 31. Dezember 2021

Dieses Dokument wurde qualifiziert elektronisch signiert und ist nur in dieser Fassung gültig. Die Veröffentlichung oder Weitergabe des Jahresabschlusses mit unserem Bestätigungsvermerk darf nur in der von uns bestätigten Fassung erfolgen. Dieser Bestätigungsvermerk bezieht sich ausschließlich auf den deutschsprachigen und vollständigen Jahresabschluss samt Lagebericht. Für abweichende Fassungen sind die Vorschriften des § 281 Abs 2 UGB zu beachten.

Auftragsverantwortlicher Wirtschaftsprüfer

Der für die Abschlussprüfung auftragsverantwortliche Wirtschaftsprüfer ist Herr Dr. Helge Löffler.

Linz, 11. März 2022

KPMG Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft

qualifiziert elektronisch signiert:
Dr. Helge Löffler
Wirtschaftsprüfer

198

STATEMENT BY THE EXECUTIVE BOARD

Pursuant to Section 124 (1) (3) of the Austrian Stock Exchange Act

We confirm to the best of our knowledge that the consolidated financial statements give a true and fair view of the assets, liabilities, financial and earnings position of the Group as required by the applicable accounting standards and that the consolidated management report gives a true and fair view of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties the Group faces.

We confirm to the best of our knowledge that the annual financial statements of the parent company give a true and fair view of the assets, liabilities, financial and earnings position of the parent company as required by the applicable accounting standards and that the management report gives a true and fair view of the development and performance of the business and the position of the parent company, together with a description of the principal risks and uncertainties the parent company faces.

Wels, March 2022

Executive Board
Stefan Pierer
Friedrich Roithner
Hubert Trunkenpolz
Viktor Sigl

198

IMPRINT

Owner and publisher
PIERER Mobility AG
Edisonstrasse 1
4600 Wels, Austria
FN 78112 x / Wels Provincial and Commercial Court

Concept and design: Grafik-Buero Elena Gratzer, 4615 Holzhausen, www.grafik-buero.at

Photos: KTM archive, Husqvarna Motorcycles/Husqvarna E-Bicycles archive, WP archive, GASGAS archive, R Raymon

The present report has been prepared with the utmost care and the correctness of the data was checked. Nevertheless, slight differences in the calculations may arise as result of the summation of rounded amounts and percentages, and typographical and printing errors cannot be ruled out.

References to persons such as “employees” or “staff members” are intended to be gender-neutral and insofar as the contrary appears this is solely for purposes of legibility.

This report and the forward-looking statements it contains were prepared on the basis of all the data and information available at the time of going to press. However, we are must point out that various factors may cause the actual results to deviate from the forward-looking statements given in the report.

This report is published in German and English. In the event of ambiguity, the German version shall take precedence.

CONTACT
Michaela Friepess
Investor Relations, Sustainability
Telefon: +43 7242 69 402
E-Mail: [email protected]
Website: www.pierermobility.com

GENERAL COMPANY DATA:

Reporting company: PIERER Mobility AG
Registered office of the company: Austria
Legal form of the company: Aktiengesellschaft
Country in which the company is registered as a legal entity: Austria
Address of registered office: Edisonstrasse 1, 4600 Wels
Headquarters of the business activity: Edisonstrasse 1, 4600 Wels
Name of the parent company: Pierer Bajaj AG
Name of the ultimate parent company: Pierer Konzerngesellschaft mbH
Business activity: The PIERER Mobility Group is Europe‘s leading “Powered Two-Wheeler” (PTW) manufacturer with a focus on highly innovative sports motorcycles and electric mobility.


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5299008TBI1EUJJSWP892021-12-31	ifrs-full:Noncontro
# Consolidated Statement of Financial Position


As at December 31, 2019	As at January 1, 2020	As at December 31, 2020
ifrs-full:IssuedCapital	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:CapitalReserve	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:RetainedEarnings	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
PIE:ReserveOfCashFlowHedges And Reserve Of Gains And Losses On Financial Assets Measured At Fair Value Through Other Comprehensive Income	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:ReserveOfExchangeDifferences On Translation	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:TreasuryShares	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:Equity Attributable To Owners Of Parent	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89
ifrs-full:NoncontrollingInterests	Member 5299008 TBI1EUJJSWP89	Member 5299008 TBI1EUJJSWP89

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PIERER Mobility AG — Annual Report (ESEF) 2021

Untitled Annual Financial Report | 2021

1. DEVELOPMENT OF THE PIERER MOBILITY GROUP

THE COMPANY

DEVELOPMENT OF SALES AND REVENUE IN THE 2021 FINANCIAL YEAR

ACQUISITION OF FELT BICYCLES

SIMPLIFICATION OF THE OWNERSHIP STRUCTURE WITH BAJAJ

STRATEGIC PARTNERSHIPS

Joint Ventures and Strategic Partnerships

INCREASE IN GLOBAL BRAND AWARENESS THANKS TO SENSATIONAL MOTORSPORT SUCCESSES

COVID-19 PANDEMIC

9999 ANNUAL REPORT 2021

2. ECONOMIC ENVIRONMENT AND MARKET DEVELOPMENT

Sales Figures

MOTORCYCLES

MARKET DEVELOPMENT

E-MOBILITY

3. FINANCIAL PERFORMANCE INDICATORS

KEY FINANCIAL PERFORMANCE INDICATORS: EARNINGS RATIOS

OTHER FINANCIAL FIGURES: EARNINGS RATIOS

BALANCE SHEET RATIONS

CASH-FLOW UND CAPEX

VALUE CREATION

UNIT SALES BY REGIONS FY 2021

REVENUE BY REGIONS FY 2021

ANNUAL REPORT 2021

E-BICYCLES

UNIT SALES BY REGIONS FY 2021

REVENUE BY REGIONS FY 2021

STATEMENT OF FINANCIAL POSITION ANALYSIS

LIQUIDITY ANALYSIS

ANNUAL REPORT 2021

INVESTMENTS

FY 2020

FY 2021

4. NON-FINANCIAL STATEMENT

ANNUAL REPORT 2021

5. RESEARCH & DEVELOPMENT AND NEW MODELS

MOTORCYCLES

E-BICYCLES

6. OPPORTUNITIES AND RISK REPORT

RISK MANAGEMENT SYSTEM

RISK MANAGEMENT STRATEGY

Risk Identification

Risk Assessment

Risiko Control

Reporting + Monitoring

RISK MITIGATION

RISK ASSESSMENT

ASSESSMENT METHODOLOGY

RISK MONITORING / CONTROL

OPPORTUNITIES AND RISK REPORT

MARKET RISKS

Cyclical risk

Competition and pricing pressure

Sales risk

Geopolitical risks

INDUSTRY-SPECIFIC RISKS

Restrictions relating to motorcycling

Procurement risk

IT RISKS

FINANCIAL RISKS

Risks due to the legal framework

Business and environmental risk

Personnel-related risks

7. DISCLOSURES PURSUANT TO SECTION 243A (1) OF THE AUSTRIAN COMMERCIAL CODE (UGB)

RISK ASSESSMENT

CONTROL MEASURES

COMMUNICATION AND MONITORING

9. OUTLOOK

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2021

CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR FROM 1/1/2021 THROUGH 12/31/2021

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR FROM 1/1/2021 THROUGH 12/31/2021

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

I. GENERAL INFORMATION

1. Company Information

2. Principles of Financial Reporting

3. Newly Applied Standards and Interpretations

4. Standards and Interpretations to be Applied in the Future

PIERER Mobility AG Annual Report (ESEF) 2021