Vow ASA — Earnings Release 2020

Oct 27, 2020

Q3 TRADING UPDATE

Henrik Badin, CEO Vow ASA Oslo, 27 October 2020

DISCLAIMER

This presentation has been prepared by the management of Vow ASA using commercially reasonable efforts to provide estimates and information about the company and prospective new markets.

The presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties.

In addition, important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Vow's businesses, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Presentation.

Vow ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the information contained in the Presentation, and neither Vow ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use of the information in the Presentation.

VOW AT A GLANCE

• Technologies and solutions that prevent pollution, enhance circular economy and mitigate climate change
• Converting biomass and waste into valuable resources, renewables and clean energy
• Customers in cruise and a wide range of land-based industries
• Headquartered in Norway, with subsidiaries in US, France and Poland
• Listed on the Oslo Stock Exchange under ticker VOW

Passionate about preventing pollution and giving waste value

Strong performance with EBITDA doubling in Cruise Projects. Interest for landbased solutions firms up

• Group revenues was up 11 % from last year to NOK 98 million, of which Cruise Projects delivered NOK 70 million
• Cruise Projects more than doubled EBITDA to NOK 19.4 million in Q3 and NOK 54.4 million YTD. Negative EBITDA in Aftersales and Landbased
• Aftersales continues to be affected by pandemic restrictions. Revenues expected to increase when cruise traffic resumes.
• Interest from landbased customers continues to increase and pipeline of potential projects is firming up
• Order backlog at the end of Q3 was NOK 1.7 billion including options, providing a strong foundation and visibility long into 2023/24.

EBITDA (in NOK million)

Revenues (in NOK million) Order backlog and options (in NOK million)

MARKET AND BUSINESS UPDATE

Q3 Trading Update

MAIN DRIVERS

Cost of capital, carbon tax and rising consumer concerns drives business towards sustainable solutions

National and international law makers and governments are pushing for new legislation and regulation

ECONOMICAL POLICIES TECHNOLOGY

Engineers, entrepreneurs and industrialists are bringing down the cost of technology in new solutions

STRONG PULL FOR OUR SOLUTIONS

Sustainable		Reduction of CO2 emissions				Safe &
tourism		Sustainable food
Clean Ship Solutions	Industry De carbonization	Biomass & Waste Valorization	Plastic Waste Valorization	End of Life Tires	Waste Sorting Robotics (AI)	Food safety

PROJECTS | CRUISE

• Newbuild projects continue at full speed at yards, relatively unaffected by the Covid-19 pandemic
• YTD revenues increased by 29.6 % year-on-year, supported by strong backlog and several system deliveries in the period
• Strong operational performance resulted in record-high EBITDA margin of 27.8 %, an increase of 73% year-on-year
• Order backlog secures revenues well into 2024/25

NOK 69.6 million revenues			NOK million	Q3 2020	Q3 2019	YTD Q3 2020	YTD Q3 2019	2019
			Revenues	69.6	55.8	230.0	177.5	236.0
Share			EBITDA	19.4	9.0	54.4	26.8	37.0
of total	71%		EBITDA margin (%)	27.8%	16.1%	23.7%	15.1%	15.7%
			Backlog			1 045	644	813

BACKLOG FOR THE LONGER TERM

Foundation for continued growth in the cruise market (8 newbuild supply awards YTD)

Number of vessel deliveries with Scanship systems inside. A total of 45 newbuilds and 143 Scanship systems.

AFTERSALES | CRUISE

• Covid-19 pandemic has rendered most cruise ships inactive, resulting in low demand for spares and chemicals in Aftersales
• Aftersales is recurring business. In a normal year, year-to-date EBITDA would have been around NOK 19 million higher.
• Large installed base represent a solid base, and there are some early signs of recovery. A significant rebound is not likely until well into 2021

LANDBASED

• Landbased revenues were in line with previous quarters and EBITDA continues to gradually improve
• Continues to build capacity within commercial, engineering and R&D to respond to new opportunities and requests, and pipeline of prospective clients and projects is firming up
• In October, Vow and Tinfos teamed up to market and distribute ETIA's plastic-to-electricity solution
• Key milestones reached on important reference projects

Landbased activities in ETIA acquired in 2019, in accounts from October. No comparable numbers for Q3 2019 available

LANDBASED PROJECT MILESTONES IN Q3

Biomass and waste valorization	Lindum Start-up of MAP and Biogreen pyrolysis units and delivery of new dryer system	Industry de carbonization	Envigas Installing Biogreen equipment, which will convert forestry waste into renewable coke
Biomass and waste Biomass and valorization waste Industry valorization de-carbonization	Switzerland (customer undisclosed) Installation of Biogreen pyrolysis which will generate biochar and syngas from waste	Biomass and waste valorization Industry de carbonization Industry de-carbonization	Circular Carbon Biogreen equipment in production for biomass valorization and energy production
Biomass and waste Biomass and valorization waste Industry valorization de-carbonization	NSR Nordvästra Skånes Renhållnings Biogreen equipment in production for waste-to-energy and biochar system	End-of-life tires	Murfitts Biogreen system commissioning underway at UK's largest tire recycling operation
Plastic waste valorization	Unipetrol Biogreen equipment in production for Czech plastic-to-liquid fuel facility		Biogreen is the brand name for various solutions based on ETIA's pyrolysis technology

SOLID FOUNDATION FOR CONTINUED GROWTH

• Strong operational and financial performance in Cruise Projects, Aftersales marked by Covid-19
• Order backlog above the one-billion mark provides visibility well into 2023/24
• Sufficiently capitalized for further organic growth with positive cashflows from projects in delivery stage
• Some early signs of recovery for Cruise Aftersales, significant rebound for this recurring business not expected until well into 2021
• Attractive market opportunities with substantial "pull" for circular economy solutions and industry decarbonization

THANK YOU FOR YOUR ATTENTION

Vow ASA | Lysaker Torg 12 | 1366 Lysaker | Norway | www.vowasa.com