TXT E-Solutions — Investor Presentation 2021

Mar 23, 2021

Virtual STAR Conference 2021 Spring Edition

March 23, 2021

Daniele Misani, CEO Andrea Favini, IR

The material in this presentation has been prepared by TXT e-solutions ("TXT") and is general background information about TXT's activities current as at the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international transactions, currency risk.

This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to TXT's businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward-looking statements. TXT does not undertake any obligation to publicly release the result of any revisions to these forward looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside TXT's control. Past performance is not a reliable indication of future performance.

Unless otherwise specified all data refers to FY 2020.

Leadership Team

Enrico Magni

Chairman

A seasoned entrepreneur with a solid track record in driving companies' growth, Enrico joined TXT as relative majority Shareholder and became first CEO in 2018 and then Chairman in 2020 with the goal to drive the growth path of TXT.

Misani Daniele

Group CEO

• 20 years in TXT, strong international background in business development and delivery, in 2020 Daniele Misani has been appointed Group CEO after the achievement of brilliant results in driving the international growth of the Aerospace & Aviation business as Managing Director of TXT Group.

Eugenio Forcinito

Group CFO

+20 years experience in the Finance and Administration sector and a deep knowledge of managerial dynamics, in the last fifteen years Eugenio has always been focused and committed to the sustainable growth and development of TXT Group.

Group Overview

TXT Group At a Glance

PIONEER OF DIGITAL TRANSOFRMATION & SOFTWARE TECHNOLOGIES today we offer a mix of best-in-class strategic software, consultancy and innovative services

30+ YEARS OF EXPERIENCE IN AEROSPACE, defence and aviation sectors with high specialized services & products

20+ YEARS OF EXPERIENCE IN BANKING & FINANCE, first mover & leader in SW Quality & Development, IT Governance services; today we offer also innovative Fintech products

INTERNATIONAL FOOTPRINT, with presence in +10 countries and offices in Europe and North America

800+ SPECIALIZED PROFESSIONALS, software engineers and architects, project engineers, consultants and subject matter experts in our core industries and technologies.

MARGIN EXPANSION 12.5% FY20 EBITDA margin, +0.6pp YoY CAGR EBITDA FY17-FY20: +35.2%

RECURRING REVENUE GROWTH More than 80% of AR are recurring, thanks to strong contractual terms and consolidated relationships

R&D INVESTMENT (expensed in the P&L) €6.7mn in FY20, +10% YoY

CASH AVAILABLE FOR GROWTH €22.1mn December 31, 2020 Net Cash

ACCRETIVE ACQUISTIONS

7 strategic investments in Fintech and IT & Digital consultancy in the 3-year period 2018-2020

#WEARETXT VALUE CREATION

TXT is an international IT Group, end-to-end provider of consultancy, software services and solutions, supporting the digital transformation of customers' products and core processes with a proprietary software portfolio and deep expertise in vertical domains

Full Year Results: 2020 vs. 2019

Results of FY 2020 show a double-digit growth in Revenues driven by M&A, with Software revenues and EBITDA increasing +25% YoY and +22% YoY respectively

6

Diversification over the period 2017-2020 with constant Organic and Software Growth & M&A contribution

FinTech incidence increased thanks to M&A and Organic Growth

Legend:

Constant double-digit organic growth (CAGR 2017-2020 +10%) achieved with the contribution of new proprietary platforms and new international customers with a significant increase in the North America market (new offices in Seattle & Dallas)

Accelerated growth of revenues in the period thanks to the positive contribution of M&A. In 2021 and with the same consolidation perimeter, division's performance further increase for the full consolidation of HSPI SpA and Mac Solutions SA (both acquired in H2-2020) and synergies

Reboot completed: a new phase of growth ahead

Group's Divisions & Markets

+5.4% YoY

12.5%

-0.6M € YoY

12.4% +2.2M € YoY

product Start-up: 1.1M € in FY-2020

Revenues breakdown

Advanced services Projects & Consultancy Software 4% 17%

Diversification

Industrial, Manufacturing, Automotive & Transportation <15% Public Sector <10%

Offering & Strategy

Focus: Aerospace & Aviation

International specialized provider of Software Solutions & Engineering Services

Some Examples of TXT's Best-in-class Solutions

• Pacelab WEAVER: the best-in-class platform for Virtual Training and Operations Support applications; • More effective training, faster & at lower costs. Aerospace & Aviation Extended Reality Collaboration & XR • Product configuration with real-time Augmented Reality visualization. FinTech Anti Money Laundry, Anti-Corruption, Anti-Terrorism Marketplace for the SCF market • Innovative digital solutions to facilitate working capital financing • A real debts' trade market where Suppliers can freely exchange their credit with the Financial Partners • Modular software solutions for risk assessment based on predictive probabilistic models; • Reduction of compliance costs (up to 70%) and timing. Fully Committed to ESG Agenda

On-board Flight Profile Optimization (FPO) Pacelab FPO

Scaling real-time data to optimize flight altitudes and speeds in all flight phases with significant fuel savings:

Preliminary Design & Evaluation

Our growth path dimensions

Shareholding & Financial Details

Dividends and Treasury Shares Repurchase (€m)

Dividends

Year	Dividends	Year	Dividends
2013	0.20 € / share		2017 0.30 € / share
2014	Free Share Distribution 1:1		2018 1.00 € / share
2014	0.25 € / share	2019	0.50 € / share
2015	Free Share Distribution 1:10	2020	nil
2015	0.25 € / share	2021	0.04 € / share
2016	0.25 € / share

Shareholding Structure March 10th, 2021*

Market Data

Share Price Dec 31st, 2010	1.51€/share*
Share Price Dec 31st, 2020	7.50€/share
Mkt Dec 31st, 2020	85m€
Dividend Yield	0,5%

rebased for free share distribution*

€ thousand	FY 2020	%	FY 2019	%	Var %
REVENUES	68,753	100.0	59,091	100.0	16.4
Direct costs	39,470	57.4	31,824	53.9	24.0
GROSS MARGIN	29,283	42.6	27,267	46.1	7.4
Research and Development costs	6,684	9.7	6,071	10.3	10.1
Commercial costs	7,636	11.1	8,610	14.6	(11.3)
General and Administrative costs	6,403	9.3	5,582	9.4	14.7
EBITDA	8,560	12.5	7,004	11.9	22.2
Amortization, depreciation and write downs	4,810	7.0	2,734	4.6	75.9
Reorganization and non-recurring costs	592	0.9	717	1.2	n.m.
OPERATING PROFIT (EBIT)	3,158	4.6	3,553	6.0	(11.1)
Financial income (charges)	562	0.8	2,194	3.7	n.m.
Non-recurring income/(charges) related to M&A	2,157	3.1	(3,432)	(5.8)	n.m.
EARNINGS BEFORE TAXES (EBT)	5,876	8.5	2,315	3.9	153.8
Taxes	(1,162)	(1.7)	(1,867)	(3.2)	n.m.
NET PROFIT	4,714	6.9	448	0.8	952.7

€ thousand	31.12.2020	31.12.2019	Var.
Intangible assets	37,653	24,380	13,273
Tangible assets	7,460	7,929	(469)
Other fixed assets	2,299	2,325	(26)
Fixed Assets	47,412	34,634	12,778
Inventories	4,749	4,156	593
Trade receivables	35,411	19,371	16,040
Other short term assets	5,782	4,779	1,003
Trade payables	(4,176)	(2,122)	(2,054)
Tax payables	(5,147)	(4,292)	(855)
Other payables and short term liabilities	(17,471)	(12,808)	(4,663)
Net working capital	19,148	9,084	10,064
Severance and other non current liabilities	(2,757)	(3,110)	353
Capital employed - Continuing Operations	63,803	40,608	23,195
Shareholders' equity	85,454	81,852	3,603
Shareholders' equity (minority interests)	409	168	241
Net financial debt	(22,061)	(41,411)	19,351
Financing of capital employed	63,803	40,608	23,195

Net cash: strong and solid financial position

€ thousand	31.12.2020	31.12.2019	Var
Cash	11,933	11,426	507
Trading securities at fair value	68,161	87,320	(19,159)
Cash & Cash equivalents	80,094	98,746	(18,652)
Short term bank loans	(28,181)	(17,353)	(10,828)
Options referred to M&A (Put/Call - Earn Out)	(960)	(6,648)	5,688
Short term financial debts - Lessors IFRS 16	(1,494)	(1,305)	(189)
Short term Financial Resources	49,459	73,440	(23,981)
Other Non current Financial Debts	(18,874)	(23,525)	4,651
Non current financial debts - Lessors IFRS 16	(3,580)	(4,517)	937
Options referred to M&A (Put/Call - Earn Out)	(4,944)	(3,987)	(958)
Non current Financial Debts	(27,398)	(32,029)	4,631
Net Available Financial Resources	22,061	41,411	(19,351)

Thank you for your attention!

www.txtgroup.com

Via Frigia, 27 20126 Milano Italy

infofinance@txtgroup.com +39 02 257711

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