Seco — Investor Presentation 2023

Nov 13, 2023

SECO: 9M 2023 Results and Business update presentation

November 15, 2023

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.

Key takeaways from 2023 YTD

Resilient business model

• 9M 2023: Net sales at €162.1m, +12% organically vs. 9M 2022
• Clea business at €16.3m in 9M 2023 (10% of sales), +12% vs. 9M 2022
• Growth distributed across geographical areas and verticals

• Components' market back to normal, with margins progressively improving to pre-shortage levels
• Clea's portion of recurring revenue consolidating with many projects under deployment
• GPM incidence at 49.5% in 9M 2023, +248 bps vs. 9M 2022

Sustained profitability

• Adj. EBITDA at €37.3m in 9M 2023 (23.0% of sales), +16% vs. 9M 2022 % Adj. Net Income at €16.2m in 9M 2023, +8% vs. 9M 2022
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• Q4 2023: good revenue trend expected
• Clea business to continue its expansion, seen at ~€7M in Q4 2023
• Despite a general economic slowdown, SECO's strategic positioning and the uniqueness of its offering allow to significantly outperform the market, seizing the enormous opportunities offered by digitalization

9M 2023 financial highlights

• Edge computing business growing at 12% in 9M 2023 vs. 9M 2022
• Clea revenue at €16.3m in 9M 2023 (vs. €14.5m in 9M 2022)
• +18% growth in 9M 2023 vs. 9M 2022
• Progressively improving components' market and positive Clea revenue contribution driven a significant margin expansion
• +16% growth in 9M 2023 vs. 9M 2022
• More than proportional increase vs. revenue growth, thanks to Gross margin effect
• +8% growth in 9M 2023 vs. 9M 2022
• D&A: +€4.6m higher vs. 9M 2022
• Financial expenses: +€1.7m higher vs. 9M 2022, largely due to the increase in market interest rates
• Taxes calculated with theoretical tax rate

Industrial 35% Fitness 10% Medical 14% Vending/ Distribution 26% Transport 3% Defence and aerospace 1% PKE 5% Others 6% €16.3m 9M 2023 Clea revenue 10% of Net sales (+27%) (+23%) (-3%) (+16%) (+16%) (-28%) Legend (±…)% Change vs. 9M 2022 by End Market

• 9M 2023 Net sales growing organically by +12% vs. 9M 2022
• Edge computing business at +12% in 9M 2023, largely thanks to a growth in the Industrial, Vending, Medical, PKE industries
• Clea business continuing its expansion trend (10% of Net sales), hitting €16.3m revenue in 9M 2023 (+12% vs. 9M 2022), of which €5.5m in Q3 2023
• Proportion of Clea recurring revenue at 40% of total
• EMEA, APAC, USA markets all showing growth trends

Adjusted EBITDA

1 Gross margin effect

• Gross margin at +18% vs. 9M 2022, mainly thanks to business expansion (in Edge computing and Clea segments) and decrease in components' price following market stabilization

2 Adjustments

Note: percentages may not sum to 100% due to rounding; all numbers in €m are rounded to the closest first decimal place, so there may be deltas for up to ±€0.1m when variation figures are displayed

Adjusted Net financial position

Adjusted Net debt bridge (€m)

Business update

Modular Vision Family

The Future of Industrial HMI

Innovation

Unprecedented flexibility and adaptability to Industrial HMI solutions

Versatility

Ideal for a variety of vertical markets, thanks to multiple mounting options, screen sizes, and core computers

Ready-to-Use Quick setup and installation, saving time and effort

Value for the Market

Flexibility, scalability, and convenience make Modular Vision a game-changer in the Industrial HMI market

11

Clea business

Supporting the diffusion of our IoT platform

Boosting market penetration

Ready to kickstart the worldwide marketing of Clea

Reduced NRE fee, to faster get new and more customers

EV Charging Station

On the road to create a full offer of end-to-end, plug-and-play solutions by vertical

Hardware + Clea: a complete and integrated product

Endless ways to EV Charger

Transforming the EV Charger Market: New AI-Driven Revenue Opportunities

SECO® - Strictly private and confidential 14

Q&A

Annex

SECO in a snapshot

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

€201M 2022 FY revenue

Listed on Borsa Italiana's Euronext STAR Milan

1M devices manufactured every year

~ 900 people

~ 300 R&D people of which ~180 in AI and software development

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

10 R&D centers 5 production plants

8 countries

Financials overview

Income Statement

€mln	9M 2022	9M 2023
Net Sales	144,8	162,1
Consumption Costs	(76,6)	(81,8)
Gross Margin	68,1	80,3
% on Net Sales	47,1%	49,5%
Other revenues	3,5	2,4
Personnel costs	(25,9)	(29,0)
Other Opex	(16,2)	(18,3)
Exchange gains/losses	0,5	1,1
EBITDA	29,9	36,5
% on Net Sales	20,7%	22,5%
EBITDA ADJ	32,1	37,3
% on Net Sales	22,1%	23,0%
Depreciation	(9,9)	(14,5)
EBIT	19,6	20,9
% on Net Sales	13,5%	12,9%
Financial expenses	(3,1)	(4,8)
Tax	(4,9)	(4,7)
Net Income	12,0	12,5
% on Net Sales	8,3%	7,7%

Balance Sheet

€mln	FY 2022	9M 2023
Net Working Capital	80,5	97,1
Total Fixed Assets	311,1	312,6
Other non-current assets	3,9	5,4
Provisions and other non-current liabilities	(30,1)	(29,9)
Net Invested Capital	365,4	385,3
Net Financial Position	128,8	72,3
Net Financial Position ADJ.	118,8	59,7
Total Equity	236,6	313,0
Total Funds	365,4	385,3

Revenue and cost model

Note: all other costs (service, personnel, other) are mostly fixed costs

Adjusted Net Income

Business model

Thank you

www.seco.com