Recticel

Earnings Release • Apr 27, 2021

PRESS RELEASE

Regulated information – Inside information

Brussels, 27 April 2021 – 07:00 CET

Recticel trading update 1st quarter 2021

• Net sales: from EUR 221.5 million¹ to EUR 256.7 million (+15.9%), including a -0.4% currency effect
• Net financial debt (including FoamPartner² ) : EUR 238.6 million, including IFRS 16 lease liabilities

Olivier Chapelle (CEO): "The positive top-line trend observed during 2H2020 has continued to develop with a solid 15.9% y-o-y growth. Good volumes in our Insulation and Engineered Foams business lines, combined with substantial price increases, have offset the sales decline in the Bedding business line, caused by shopping restrictions in several markets due to the COVID-19 pandemic.

The chemical raw materials supply remains constrained due to renewed 'force majeure' events and planned maintenance at the premises of our suppliers. This creates continued supply shortages of polyols and isocyanates, thatour suppliers use to implement price increases at a historically high pace, leading to new all-time highs. In response to this, we mitigate these cost increases through corresponding selling price increases. The situation is not expected to normalize before 4Q2021.

During the quarter, we completed the FoamPartner acquisition in Engineered Foams, and the integration process has now started. We also signed preliminary agreements to acquire Gór-Stal's insulation board business, and are currently performing the confirmatory due diligence while preparing its integration in the Insulation business line. At the same time we initiated the divestment process of our Bedding business line. These three strategic initiatives are currently all progressing according to plan."

OUTLOOK

Our underlying end-use markets remain difficult to predict in the context of the COVID-19 pandemic. Regardless of these uncertainties, our Group confirms its expectation to realise in 2021 a substantial increase in sales, and at least a 30% increase of its Adjusted EBITDA, not taking into account the contribution from the FoamPartner and the Gór-Stal acquisitions, nor the related synergies. The Group will provide guidance adapted to the new perimeter, including the acquired operations of FoamPartner and Gór-Stal, at the occasion of the publication of its first half-year 2021 results.

¹ Following the partial divestment from Automotive Interiors on 30 June 2020 (see press release of 01 July 2020), Automotive Interiors is integrated in the consolidated accounts according to the 'equity method'.

To facilitate comparisons and understanding of the Group's underlying performance, all comments in this document on developments in revenue or results are made on a like-for-like basis unless otherwise indicated.

²The FoamPartner acquisition has been completed on 31 March 2021, hence the financial position includes the impact of the acquisition as of that date whereas the results will be integrated in the income statement going forward as of 1 April 2021.

1. SALES DEVELOPMENT

On a like-for-like basis¹ , sales increased by 15.9% from EUR 221.5 million¹ to EUR 256.7 million, including a currency impact of -0.4%.

Despite the development of the second COVID-19 wave since the autumn, the positive sales momentum continued in 1Q2021. The sales growth was supported by solid volumes and higher selling prices, compensating for the steep increase in chemical raw material costs induced by a continuing demand/supply imbalance. The comparison basis with 1Q2020 became irrelevant as of mid-March 2021 given the general lockdowns implemented in our markets as of mid-March 2020.

Breakdown of the sales by segment

in million EUR	1Q2020	1Q2021	D
Engineered Foams	89.4	103.6	15.9%
Bedding	65.2	55.7	-14.5%
Insulation	60.7	86.9	43.1%
Corporate / Eliminations	6.2	10.5	69.4%
TOTAL CONSOLIDATED SALES	221.5	256.7	15.9%

A. Engineered Foams

Sales increased by 15.9% in 1Q2021 from EUR 89.4 million in 1Q2020 to EUR 103.6 million, including a -0.9% impact from exchange rate differences. External sales increased by 18.3% from EUR 81.3 million to EUR 96.2 million.

The sales increase is due to the combination of supportive volumes and higher selling prices that compensate for the steep surge in chemical raw material prices following several force majeure events and other supply issues in the upstream value chain since September 2020.

The Engineered Foams numbers will include FoamPartner as from April 1st, 2021.

B. Bedding

Sales decreased by 14.5% in 1Q2021 from EUR 65.2 million in 1Q2020 to EUR 55.7 million, including a +0.6% impact of exchange rate differences. External sales decreased by 14.7% to EUR 54.8 million in 1Q2021.

The sales decrease in 1Q2021 is due to COVID-19 related shopping restrictions, which impacted volumes in the Netherlands and in DACH. It is expected that volumes will pick up strongly once the mobility and shopping restrictions will be lifted.

C. Insulation

Sales increased by a strong 43.1% in 1Q2021 from EUR 60.7 million in 1Q2020 to EUR 86.9 million, including a -0.5% impact of exchange rate differences.

The sales increase results from a combined effect of (i) a strong volume development and (ii) selling price increases implemented to compensate for the steep surge in chemical raw material prices.

The new plant in Finland continues to increase its output.

In 1Q2021 the strong demand for VIP (Vacuum Insulation Panel) material has continued, boosted by demand for ultra-high performance insulation materials needed for the transportation and storage of COVID-19 vaccines.

Subject to a successful closing of the acquisition of the Gór-Stal insulation boards' business in the course of July 2021, the Insulation numbers will include Gór-Stal as from August 1st , 2021.

2. FINANCIAL POSITION

in million EUR	31 MAR 2020	30 JUN 2020	30 SEP 2020	31 DEC 2020	31 MAR 2021
TOTAL EQUITY	-	331.5	-	334.8	-
Net financial debt excluding factoring	121.4	( 11.4)	( 43.7)	( 47.9)	132.2
+ Drawn amounts under factoring programs	32.1	0.0	0.0	0.0	43.3
+ Lease debt (IFRS 16)	77.6	55.2	52.9	52.5	63.1
TOTAL CONSOLIDATED NET FINANCIAL DEBT	231.1	43.8	9.3	4.6	238.6
Gearing ratio (incl. IFRS 16 )	-	13.2%	-	1.4%	-
Leverage ratio (incl. IFRS 16)	-	0.7	-	0.1	-

The Group's total net debt position increased by EUR 234.0 million over 1Q2021 to reach EUR 238.6 million, due to (i) the acquisition of FoamPartner (see press release 01 April 2021), and its EUR 13.0 million impact on consolidated IFRS 16 lease debt and (ii) a higher net working capital resulting primarily from the raw material inflation and its consequences.

°°°

Financial calendar

First quarter 2021 trading update	27.04.2021 (at 07:00 AM CET)
Annual General Meeting	25.05.2021 (at 10:00 AM CET)
First half-year 2021 results	27.08.2021 (at 07:00 AM CET)
Third quarter 2021 trading update	29.10.2021 (at 07:00 AM CET)
Annual results 2021	25.02.2022 (at 07:00 AM CET)
First quarter 2022 trading update	28.04.2022 (at 07:00 AM CET)
Annual General Meeting	31.05.2022 (at 10:00 AM CET)
First half-year 2022 results	26.08.2022 (at 07:00 AM CET)
Third quarter 2022 trading update	28.10.2022 (at 07:00 AM CET)

For additional information

RECTICEL avenue du Bourget/Bourgetlaan 42, 1130 Brussels
	PRESS	INVESTOR RELATIONS
	Mr Olivier Chapelle Tel: +32 2 775 18 01 chapelle.olivier@recticel.com	Mr Michel De Smedt Mobile: +32 479 91 11 38 desmedt.michel@recticel.com

Recticel in a nutshell

Recticel is a Belgian Group with a strong European dimension, but it also operates in the rest of the world. Recticel (excluding minority stakes in joint ventures) employs 4,221 people in 41 establishments in 20 countries.

Recticel contributes to daily comfort with high performance insulation solutions, mattresses and slat bases of top brands and an extensive range of polyurethane foam products for industrial and domestic applications.

Within Recticel's Insulation segment, the high-quality thermal insulation products are marketed under the wellknown brands Eurowall®, Powerroof®, Powerdeck®, Powerwall® and Xentro®. Recticel is also the Group behind the bedding brands (Beka®, Lattoflex®, Literie Bultex®, Schlaraffia®, Sembella®, Swissflex®, Superba®, etc.) and GELTEX®.

In 2020 Recticel achieved consolidated sales of EUR 828.8 million.

Recticel (Euronext: REC – Reuters: RECTt.BR – Bloomberg: REC:BB) is listed on Euronext in Brussels.

The press release is available in English and Dutch on the website www.recticel.com