Technotrans : Communication (TEC Report Q1 2024 EN)

Key figures of the technotrans Group (IFRS)

			01/01	01/01
		previous year	31/03/2024	31/03/2023	2023
Revenue
-18.0 %	56,041	68,312	262,116
Technology	-21.4 %	41,477	52,759	199,590
Services	-6.4 %	14,564	15,553	62,526
EBIT	-88.9 %	392	3,533	14,175
EBIT margin	%		0.7	5.2	5.4
Net profit for the period1	-97.3 %	59	2,203	8,532
as percent of revenue	%		0.1	3.2	3.3
ROCE	%		10,29	13	13,3
Earnings per share	-98.1 %	0,01	0,32	1,24
Balance sheet total assets	-1.7 %	167,605	172,686	170,568
Equity*	0.0 %	95,441	93,184	95,433
Equity ratio	%		56.9	54.0	56.0
Net debt*2	18.0 %	24,407	28,959	20,690
Free cash flow3			-3,007	-1,678	-3,738
Employees (balance sheet date)*	-2.4 %	1,560	1,536	1,598

*Change compared to December 31, 2022
1 Result for the period:	Profit attributable to shareholders of technotrans SE
2 Net debt:	Interest-bearing financial liabilities including lease liabilities
	according to IFRS 16 ./. cash and cash equivalents
3 Free cash flow:	Net cash from operating activities +
	Net cash used for investments according to cash flow statement

Presentation of significant events and business performance in the first 3 months 2024

Revenue performance

The technotrans Group generated consolidated revenues
								achieved revenues of
41.5 million in the three-							, the Services segment realized
		Technology	Services		technotrans Group
		3M 2024	3M 2023		3M 2024		3M 2023	3M 2024	3M 2023
Revenue		41.5	52.8		14.6		15.6	56.0	68.3
EBIT		-0.9	1.5		1.3		2.0	0.4	3.5
EBIT margin	%	-2.2	2.9		9.0		12.8	0.7	5.2

The main reason for this development was the persistently weak economic environment, particularly in Germany, coupled with high interest rates. This resulted in subdued demand in almost all relevant markets for the technotrans Group.

In the focus market Plastics, the reluctance by customers to invest continued, particularly in large

of Group revenue reached 22%.

The focus market Healthcare & Analytics recorded a decline in revenue compared to the previous

. However, Q1-2023 was extraordinarily strong following high demand during Corona pandemic.

, a 14% decrease versus previous year. In addition to the weak economy, this reflected a potential reluctance to place orders in the run-up to the drupa - the world's leading trade fair for the printing industry - which will take place in Düsseldorf in May/June 2024.

The new focus market Laser was particularly sensitive to the economy and characterized by cyclical-

Decoupled from economic developments, the focus market Energy Management continued its strong growth based on the successful positioning in the areas of electromobility and data centers.

Group revenue amounted to around 14%.

Quarterly Communication Q1/2024

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The focus on the core business was further expanded through continued portfolio optimization. The focus markets, which contain the Laser business since the beginning of the financial year, generated

-

to-bill ratio was 1.1.

Earnings situation

As expected, the lower revenues in the first quarter of 2024, combined with less favourable cost degression and first expenses related to the reorganisation of the technotrans Group, had an impact on consolidated EBIT and the return on capital employed (ROCE).

Gross margin fell by 20% year-on-The respective margin reached 25.5% (previous year: 26.3%). The group reacted to the weak order situation by short- time work at selected German locations.

costs over-compensated the increased trade fair costs due to drupa. The increase in administrative expenses was mainly due to restructuring expenses.

The development outlined above had a particular impact on the earnings situation of the Technology -0.9 million as a result of the weaker revenue. The segment EBIT margin amounted to -2.2%. The Services segment was more resilient to

economic fluctuations, but also here the segment EBIT declined million), which corresponds to a segment EBIT margin of 9.0%.

. Adjusted for personnel-relatedone-off expenses

from restructuring

sulted in an EBIT margin of 0.7% and an adjusted EBIT margin of 2,0% (previous year: 5.2%). EBITDA

fell from 5.2 million	, ROCE reached 10.3% (previous year: 13.0%).
	-month period (previous year:

2.2 million). Earnings per share therefore

year.

Net worth

The balance sheet total on March 31, 2024 amounted	and decreased compared to
the end of the year 2023

€ 30.2 million. The subdued business development and scheduled loan repayments led to a decrease in cash

compared to December 31, 2023. The equity ratio rose by 0.9 percentage points to 56.9%. Trade pay-

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Financial position

Based on the subdued business development in the reporting period, cash flow from operating activ-

the higher order backlog and higher receivables led to a net change in cash flow from operating ac-

---0.4 million, cash flow from investing activ- -1.0 million). This resulted in a free cash flow

-	- 1.7 million).

	million were repaid. Cash flow from financing activities
-	-0.2 million). The technotrans Group had unused credit

Strategy

Based on the strategy review carried out in the 2023 financial year, a program to increase efficiency was initiated under the name ttSprint. This covers 4 components: Portfolio and markets, efficiencies, innovation and organization. At its core, ttSprint involves strengthening entrepreneurship within the Group. The transformation is intended to improve customer focus, increase the speed of response and boost profitability. The program is expected to generate initial improvements in earnings as early as 2024 and also to ensure that the medium-term targets for 2025 are achieved. In the first quarter of 2024, the future organizational structure of the 4 divisions Plastics, Healthcare & Analytics, Energy Management & Laser and Print was communicated as a significant step forward in the project. In addition, the division heads were appointed, each of whom will bear full responsibility for sales and earnings. The target structures will be developed in the first half of 2024. The transformation will start at the beginning of the second half of the year. It should be completed by December 31, 2024. Implementation is fully proceeding according to plan.

Change in the Board of Management

On March 11, 2024, the company and Peter Hirsch reached a mutual agreement on the termination of his employment contract with effect from April 30, 2024 (original term until December 31, 2025). The appointment of Peter Hirsch to the Board of Management ended on March 11, 2024.

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Overall statement by the Board of Management on the business performance

"The German economy got off to a weak start to the new year. As expected, revenue and earnings performance in the first quarter of 2024 was down on the previous year in all markets with the exception of Energy Management. technotrans already began to set the course for increasing profitability in the 2023 financial year. As part of the ttSprint project, the transformation of the Group into an entrepreneurial organization has begun. Initial one-off expenses already incurred for this were also recognized in the result.

Irrespective of economic developments and the transformation, technotrans has already achieved significant sales successes in the 2024 financial year. Of particular note here is the follow-up order for the cooling of fast-charging stations from ADS-TEC Energy and the major order for liquid cooling systems for existing data centers (retrofit).

The Board of Management anticipated the weak revenue and earnings performance realized in the first quarter of 2024 and initiated measures to safeguard profitability at an early stage. These include the instrument of short-time working, but also cost savings and the postponement of investments. Nevertheless, the results are not satisfactory and encourage us to consistently drive forward the transformation of the Group as part of the ttSprint project."

Report on post-balance sheet date events and risk report

No events with a significant impact on the net worth, financial position and results of operations of the technotrans Group occurred after March 31, 2024.

The relevant opportunities and risks for the future development of the technotrans Group and the risk management system implemented were explained in detail in the 2023 Annual Report. The opportunity and risk situation of the Group has not changed compared with the presentation in the Annual Report as of December 31, 2023.

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Outlook

Expected framework conditions

Low growth rates are expected for the German economy in 2024. According to the World Economic Outlook published in April 2024, the IMF expects Germany's gross domestic product to grow by 0.2% in 2024. The German government's growth forecast, which was increased by 0.1 percentage points to 0.3% in April 2024, is at a comparable level. The IMF is forecasting growth of 0.8% for the eurozone in 2024. The background to the expected improvement is essentially a moderate upturn in private consumption due to rising real incomes.

Expected business development of the Group

The growth forecasts indicate a generally subdued economic development in the 2024 financial year. The Future Ready 2025 strategy and the ttSprint project initiated at the start of the financial year will accelerate the company's transformation into a market-oriented organization. The structures are currently being developed and should come into effect at the start of the second half of 2024. The focus is on the formation of 4 divisions with full responsibility for revenue and earnings.

Market development will be differentiated: The Energy Management focus market is expected to remain highly dynamic, irrespective of economic developments. This expectation is already underpinned by corresponding major orders of a serial nature in the areas of charging infrastructure and liquid cooling for data centers. The Board of Management expects the other markets to pick up over the course of the year.

With existing production capacity, qualified personnel and stable procurement markets, the tech- notrans Group is concentrating on achieving the set targets.

In view of the increasing importance of intelligent thermal management based on the megatrends of decarbonization, digitalization and electrification as well as the consistent strategic focus, the Management Board is confident about the future despite the difficult conditions and is convinced that it will achieve the revenue and EBIT targets set for 2024 and 2025.

and 16.0% in the 2024 financial year.

The mid- gin between 9.0% and 12.0% and a ROCE of over 15% in the 2025 financial year remain unchanged. M&A transactions are not included in this figure.

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Consolidated Balance Sheet

Assets
		31/12/2023
	31/03/2024
Non-current assets
Property, plant and equipment	35,821	36,253
Right-of-use assets	4,532	4,479
Goodwill	23,513	23,513
Intangible assets	3,831	4,028
Other financial assets	211	210
Deferred taxes	632	631
	68,540	69,114
Current assets
Inventories	46,359	44,990
Trade receivables	30,240	30,212
Income tax receivable	143	233
Other financial assets	1,600	859
Other assets	3,278	2,390
Cash and cash equivalents	17,445	22,770
	99,065	101,454
Total assets	167,605	170,568

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Equity and Liabilities
		31/12/2023
	31/03/2024
Equity
Issued capital	6,908	6,908
Capital reserve	19,097	19,097
Retained earnings	74,513	65,982
Other reserves	-5,137	-5,086
Net profit for the period	59	8,532
Total equity attributable to technotrans SE shareholders	95,440	95,433
Non-controlling interests in equity	1	0
	95,441	95,433
Non-current liabilities
Borrowings	27,434	29,668
Employee benefits	1,100	1,092
Other financial liabilities	2,503	2,504
Deferred taxes	703	726
	31,740	33,990
Current liabilities
Borrowings	9,801	9,240
Trade payables	7,459	7,165
Prepayments received	6,058	6,066
Employee benefits	5,180	5,607
Provisions	3,302	3,200
Income tax payable	2,200	3,259
Other financial liabilities	3,120	3,004
Other liabilities	3,304	3,604
	40,424	41,145
Total equity and liabilities	167,605	170,568

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Consolidated Income Statement

	01/01/ -	01/01/ -
	31/03/2024	31/03/2023
Revenue	56,041	68,312
of which Technology	41,477	52,759
of which Services	14,564	15,553
Cost of Sales	-41,739	-50,372
Gross profit	14,302	17,940
Distribution costs	-6,634	-7,018
Administrative expenses	-6,025	-5,639
Development costs	-942	-1,362
Income/expenses from impairment losses on financial assets
and contract assets	4	-193
Other operating income	341	320
Other operating expenses	-654	-515
Earnings before interest and taxes (EBIT)	392	3,533
Financial income	46	2
Financial expenses	-352	-319
Financial result	-306	-317
Profit before tax	86	3,216
Income tax expense	-27	-1,013
Net profit for the period	59	2,203
of which:
Profit attributable to technotrans SE shareholders	59	2,203
Profit attributable to non-controlling interests	0	0
basic / diluted	0.01	0.32
Overall result for the financial year	168	2,303

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