Seco — Investor Presentation 2022

May 12, 2022

S E C O : Q 1 2 0 2 2 R e s u l t s a n d B u s i n e s s u p d a t e p r e s e n t a t i o n

Disclaimer

This document has been prepared by SECO S.p.A. ("SECO" or the "Company"), for information purposes only, exclusively with the aim of assisting you to understand and assess the activities of SECO. The information contained in this presentation does not purport to be comprehensive and may not have been independently verified by any independent third party.

Statements contained in this presentation, particularly regarding any possible or assumed future performance of the SECO Group, are or may be forward-looking statements based on SECO's current expectations and projections about future events.

Such forward-looking statements are subject to risks and uncertainties, the non-occurrence or occurrence of which could cause the actual results, including the financial condition and profitability of SECO to differ materially from, or be more negative than, those expressed or implied by such forward-looking statements, due to any number of several factors, many of which are beyond the ability of SECO to control or estimate precisely. Consequently, SECO and its management can give no assurance regarding the future accuracy of the estimates of future performance set forth in this document or the actual occurrence of the predicted developments.

The data and information contained in this document are subject to variations and integrations. Although SECO reserves the right to make such variations and integrations when it deems necessary or appropriate, SECO assumes no affirmative disclosure obligation to make such variations and integration, except to the extent required by law.

SECO does not undertake any obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation.

Any reference to past performance of the SECO Group shall not be taken as an indication of future performance.

In addition, this presentation includes or may include certain ''Adjusted'' financial and operating indicators and other measures, which have been adjusted to reflect extraordinary events, non-recurring transactions and activities which are not directly related to the Group's ordinary business.

Such "Adjusted" information has been included to allow a better comparison of financial information across the periods; however, it should be noted that such information is not recognized as measures of financial performance or liquidity under IFRS and/or do not constitute an indication of the historical performance of the Company or the Group. Therefore, investors should not place undue reliance on such data and information.

This presentation does not constitute a recommendation regarding the securities of the Company.

This document does not constitute or form part of any offer or invitation to purchase or subscribe any shares issued by the Company and no part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.

By reading this presentation, you agree to be bound by the terms set out.

Here today

Massimo Mauri CEO

Marco Parisi Head of Investor Relations

Lorenzo Mazzini CFO

Key takeaways from 2022 YTD

• GPM incidence stable vs. FY 2021, at 47% despite components' shortage on the market

• Q1 2022: Net sales at €42.8m, +120% vs. Q1 2021(+56% organic, +45% on a like-for-like basis) • Adj. EBITDA at €8.6m (20.0% of sales), +86% vs. Q1 2021

• SaaS business at €3.7m in Q1 2022 (+68% vs. Q4 2021)

• Q2 2022 Net sales: official guidance at €51m-52m, +128%-133% vs. Q2 2021 (+67%-71% organic, +51%-54% on a like-for-like basis)

• Order backlog at €164m at 30.04.22 vs. €69M (April 2021) on a like-for-like basis

• Components' availability is key to ensure continuity in deliveries to our customers

• Gross margin and cash flow pressure to be seen as contingent, short-term effects of the most difficult

A resilient business model: how we are facing the components' shortage

Shortage main impacts on SECO business Our levers to tackle it and keep delivering customer orders

Working capital increase to maximise components availability

Difficulties in finding some components impacted on some product deliveries scheduled for end of Q1 2022

Key takeaways from 2022 YTD (cont'd)

Decreasing GPM on the edge computing business

Ensuring shipping continuity: today's most powerful way to strengthen our long-term competitive advantage and acquire new business opportunities

Q1 2022 financial highlights

€42.8m in Q1 2022 (vs. €19.4m in Q1 2021)

• +56% organic growth, +45% like-for-like growth in Q1 2022 vs. Q1 2021
• Edge computing business growing at ~106% in Q1 2022 vs. Q1 2021
• SaaS revenue at ~€3.7m in Q1 2022 (+68% vs. Q4 2021)
• Growth distributed across EMEA, APAC and USA

+104%

Gross margin growth

€20.1m in Q1 2022 (vs. €9.8m in Q1 2021)

• 47.0% of net sales in Q1 2022, vs. 50.6% in Q1 2021

• Positive impact from CLEA revenue

• Profitability substantially unchanged vs. FY 2021, despite components shortage affecting all the market • Price increase actions adopted have helped maintain stability in the gross margin incidence

Strong revenue growth, with gross margin substantially unchanged vs. end-of-2021 levels

€8.6m in Q1 2022 (vs. €4.6m in Q1 2021)

• 20.0% of net sales in Q1 2022 vs. 23.7% in Q1 2021

• Q1 2022 vs. Q1 2021 change in incidence substantially due to gross margin effect

Adj. Net Income growth

€3.2m in Q1 2022 (vs. €2.5m in Q1 2021)

Q1 2022 financial highlights (cont'd)

• D&A: +€1.7m higher vs. Q1 2021, driven also by purchase price allocation (PPA) on G&F customer list • Financial expenses: +€0.7M higher vs. Q1 2021, largely due to G&F acquisition financing

• 7.5% of net sales in Q1 2022 vs. 12.6% in Q1 2021

• Potential upside (taxes calculated with theoretical tax rate)

Sustained Adj. EBITDA growth thanks to Edge computing + SaaS businesses expansion

Net sales breakdown (Q1 2022)

• Q1 2022 Net sales growing by +120% vs. Q1 2021 (+56% organic, +45% on a like-for-like basis) • SaaS business continuting its strong expansion trend, hitting ~€3.7m revenue in Q1 2022 (+620% vs. Q1 2021, +68% vs. Q4 2021)
• Edge computing business at +106% in Q1 2022, largerly thanks to a growth in the Industrial, Fitness, Medical, Vending industries • EMEA, APAC, USA markets all showing growth trends

Net sales

Net sales

Strong quarter-by-quarter growth driven by organic and M&A expansion

Adjusted EBITDA

Adjusted EBITDA bridge (€m)

Adjusted Net Income

Adjusted Net financial position

Business Update

Leading the next frontier of innovation

A large number of start-ups and software houses will develop CLEA-based apps …

… making them available on the CLEA app store CLEA App store Smart devices

April '22 backlog

Strong visibility on 2022 and 2023 from both historical business and recently acquired companies

(±…)% Change vs. Apr. 2021

15 ¹ Considering also Garz & Fricke Group figures as of April 30, 2021 Note: percentages may not sum to 100% due to rounding

Edge computing business

SaaS business

Devices installed base continues to generate revenues for the years to come

Recurring and incremental business model…

…being adopted in a larger number of sectors

SECO-Camozzi Digital industrial partnership

A fast track to the App Store made by SECO

• Benefit from the unique Industrial competences of Camozzi Group
• Leverage a portfolio of ready-to-use apps and algorithms, a rapid expansion of CLEA applications for the Industrial market

• Camozzi Digital will transfer a business unit, becoming a reference shareholder of SECO

Developers of AI algorithms and apps

SECO-Camozzi Digital partnership in numbers

>90 Ready-to-use apps to be integrated into CLEA

>3yr.

Time-to-market acceleration of SECO IIoT SaaS offering

Cumulated incremental SaaS revenue expected in 2023-25

~€50m

o/w ca. €14M already in 2024

€3.6m

CLEA licenses to be purchased by Camozzi Digital

~€5m Edge computing (HMI) sales to Camozzi

• Launch of CLEA Smart HMI and CLEA Smart Factory, 2 new versions of CLEA for the Industrial world

Q2 2022 official guidance

Organic growth expected to continue also in Q2 2022

An innovative strategy to continue creating value for our shareholders

€400m+ Revenue (2025 target) from strong organic growth

Market leader in the IoT-AI space

SaaS business (CLEA + App) transition as a game changer for SECO and its customers

Final remarks

(cont'd)

Financials overview

Income Statement

€mln	Q1 2021	Q1 2022
Net Sales	19,4	42,8
Consumption Costs	(9,6)	(22,6)
Gross Margin	9,8	20,1
% on Net Sales	50,6%	47,0%
Other revenues	0,8	1,0
Personnel costs	(4,4)	(8,2)
Other Opex	(2,0)	(5,6)
Exchange gains/losses	0,2	(0,1)
EBITDA	4,5	7,2
% on Net Sales	23,3%	16,9%
EBITDA ADJ	4,6	8,6
% on Net Sales	23,7%	20,0%
Depreciation	(1,4)	(3,2)
EBIT	2,9	4,1
% on Net Sales	14,7%	9,6%
Financial expenses	(0,1)	(0,8)
Tax	(0,8)	(1,0)
Net Income	2,2	2,2
% on Net Sales	11,4%	5,2%

Balance Sheet
€mln	FY 2021	Q1 2022
Net Working Capital	52,5	79,2
Total Fixed Assets	233,3	234,0
Other non-current assets	3,1	3,2
Provisions and other non-current liabilities	(16,4)	(16,4)
Net Invested Capital	272,5	299,9
Net Financial Position	109,5	139,0
Net Financial Position ADJ.	97,5	125,8
Total Equity	163,0	160,9
Total Funds	272,5	299,9

Revenue and cost model

Business model

>800 people

250+ R&D people of which ~150 in AI algorithms development

9 R&D centers 5 production plants

~ 8-10% of revenue invested in R&D every year

~900k devices manufactured every year

€200M 2022 FY expected revenue

SECO at a glance

A worldwide spread center of excellence, with top-tier capabilities…

A highly committed management team

Dario Freddi CEO SECO Mind

Previously founder and CEO of Ispirata Srl Strong data orchestration background in primary worldwide leading companies

2 years

Lorenzo Mazzini CFO

Served as CFO in several public and private companies Strong experience in IPO and M&A transactions

yearsin SECO

Gianluca Venere CIO

10+ years experience in business development, sales, innovation and internationalization for SECO Group

Business Manager of SECO from September 2019 Financial advisor of SECO

from September 2016 to September 2019

Marco Parisi Head of IR

Previously co-Founder and CEO of AidiLab Joined SECO in 2018 as

Chief Product Officer Maurizio Caporali

IoT BU Product Manager and R&D Project Manager

Daniele Conti President & Co-Founder

Co-founder of SECO. He has been serving as president of the company for over 40 years Under his leadership, the Group has grown in terms of technological expertise, human resources and financial performances

Massimo Mauri

CEO 20+ years experience as executive in several Tech companies Strong experience in IPO and M&A transactions

30+ year experience in high-tech, IoT and AI Former executive in Google, Cisco, Qualcomm, Motorola

Serving also as CFO of Fannal Electronics Strong corporate finance and M&A background

Alessandro Hong CEO SECO China

3 years

Stefan Heczko

Previously CEO of Garz & Fricke GmbH 10+ years experience as executive in industrial companies

CEO SECO Northern Europe

~1

year

Angela Lepore Group HR Director

15+ years of experience in HR management in multinational and international companies

Lesen Ding CEO Fannal Electronics

Founder and General Manager of Fannal Electronics (2011 – present)

Michael Duhamel Vice President of Sales SECO USA

20+ years of experience in sales and marketing for the largest industrial, embedded and automation solution providers Previously in Eurotech USA

Angelo Peloni COO

20+ years experience in Operations & Supply chain management Joined SECO in 2003

Carlos Valeiras

CEO SECO USA

20+ years experience as executive in several Tech companies Former CFO of SECO USA from 2020

Vincenzo Difronzo CSO

15+ years sales experience in worldwide leading hardware and software companies Joined SECO in 2015

Davide Catani CTO

Joined SECO in 2006 CTO since 2020, after serving as Hardware developer and ARM-based platforms R&D manager

SECO at a glance

Our offering from Edge to AI: unique market positioning vs. competitors

The power of AI at your fingertips

SECO at a glance

CLEA: the value of AI

The people of SECO Mind

We are an AI as a Service Company.

Our vision is to augment the abilities of machines and people by using AI everywhere computing takes place.

Neuroscientists, Data scientists, Software Engineers, Hardware Engineers, and Cloud SREs

Silicon Valley, India, Italy, Germany & Brazil

Our AI capabilities

Anomalies & Forecast

Recommendation Engine

Augmented Reality

Patterns, Seasonality, Anomalies, Diagnostic, Predictive, Prescriptive, & Descriptive analytics

Predict user relevant products, services, and information

Computer generated visual, auditory, haptic, somatosensory and olfactory enhancements for personalized experiences

CLEA: the value of AI

Run AI anywhere: it's easy!

A traditional device

1

2

3

5

4

Device Management

Lifecycle management Configuration Management Remote access/Diagnostics 24x7 Monitoring

Artificial Intelligence

Modular/App Store Anomaly, Data Imputing, Forecast Descriptive, Diagnostic, Predictive, and Prescriptive Edge or Cloud AI Explainable AI

Multi Tenant

Data isolation for each tenant Channel, Distributor, VARs White Label Cloud Devices for Home or Enterprise

User Experience

Web Interface

Mobile Apps NLP Chatbots

Smart Connected device

Make any device an intelligent connected device

CLEA: the value of AI

Products & Services Value Proposition

Fast Time to market

Accelerate customers' go to market strategy

CLEA for customer's cost reduction:

Support optimization

Predictive maintenance

Refill optimization

CLEA enables a new business model for our customers:

Subscription Revenues

Recurring Revenues

	Reinvent value proposition and business model by shifting from products to services
	Minimizes risk of failure
	Helps create products and services people want
	Deliver what customers want
	Develop services around device
Apps	Win-win
For Vertical Markets

Transform a technology (innovation) into a fashionable trend. Technology Push

Market Pull

Turning Technology into a Viable Business

SECO Service Design Consulting for AI & IoT solutions

Value for Your Customer and Your Business

Vertical Applications of CLEA

Recipe Sales Trends Analysis App

CLEA Vending Machine Apps

Fault Detection & Machine Downtime Reduction AI Smart Refill

Boiler Predictive Maintenance

	CLEA Boiler App

UPS Management

Vertical Applications of CLEA

Landing Page

How customers can generate higher margins, recurring revenues, better differentiation

BLE Audience Analysis

Vertical Applications of CLEA How customers can generate higher margins, recurring

revenues, better differentiation

Each sector has its own KPIs to watch, making AI customization change significantly across each vertical

"Apple-like" successful approach based on an ecosystem of applications and connected devices with proprietary hardware and software

Cross-sector experience generating strong IP for each vertical: launching the CLEA App store

An innovative strategy for a long-term growth path

Deeply understanding customers' needs proves crucial when it comes to customizing AI algorithms

Strong value creation opportunity from introducing specific functionalities for each vertical

Edge computing CLEA CLEA App store

Customer base Geographies New technologies and functionalities

New Apps

M&A: key focus areas by segment

d Appliance:
Search	Q
Client A Client C Client B	≫
Appliance Name Appliance S/N Client Tag
Segreteria Siena Design RU 1234 5678 9000 PRO Client A
RU 1234 5678 9000 PRO Jfficio_Design Client A Siena	Design
Jfficio_Boss RU 1234 5678 9000 PRO Arezzo Client A	Server.
Jfficio_Boss RU 1234 5678 9000 PRO Client A Arezzo	Server 2
RU 1234 5678 9000 PRO Jfficio_Boss Client A Arezzo	Server
Jfficio_Boss RU 1234 5678 9000 PRO Client B Arezzo	Server
Jfficio_Boss RU 1234 5678 9000 PRO Client B Arezzo	Server
Jfficio_Boss RU 1234 5678 9000 PRO Client B Arezzo	Server
Jfficio_Boss RU 1234 5678 9000 PRO Client B Arezzo	Server
Jfficio_Boss RU 1234 5678 9000 PRO Client B Arezzo	Server
$\overline{\mathbf{c}}$ 1 appliances	3

What's next? Complementing organic growth with additional, value-accretive transactions to further expand our competitive advantage

An innovative strategy for a long-term growth path

Thank you