30 November 2021

Soltech Energy Sweden AB (publ) quarterly report for the period June-September 2021

CONTINUED VERY STRONG GROWTH DURING QUARTER 3

Soltech continues to deliver triple-digit growth with an increase of as much as 110% at Group level and 162% for the Swedish operations.

CEO comment:
– Rapid growth is our focus and here we really deliver again. Having 162% growth, of which 39% organic, is a sign of strength. We are in a strong position for 2022, which I am really looking forward to.

THIRD QUARTER IN BRIEF
▪ The Group's revenues in the quarter amounted to SEK 267.2 (127.2) million. An increase of 110%. The Group's organic growth amounted to 39%.
▪ Revenues in the Swedish operations increased to SEK 220.1 (84) million, an increase of 162%.
▪ Revenues in the Chinese operations amounted to SEK 47.1 (43.2) million, an increase of 9%.
▪ The Group's profit before depreciation (EBITDA) amounted to SEK 29.3 (38.9) million. The decrease was driven by continued investment in existing operations and is also
linked to component shortages and increased prices of goods.
▪ The Group's operating profit (EBIT) amounted to SEK 4.6 (23.1) million. The decrease in operating profit is due to increased amortization of goodwill, as a direct result of completed company acquisitions, as well as investments in solar energy facilities and investments in existing operations.
▪ Profit for the period after tax amounted to SEK -10.6 (-18.1) million. The result was affected by unrealized exchange rate differences in the Chinese operations by SEK 22.1 (1.3) million.
▪ Cash flow for the period from operating activities amounted to -116.9 (11.4) MSEK and has been affected by investments in existing operations and increased inventory levels to secure deliveries to existing projects.
▪ Cash flow for the Group for the period amounted to SEK 399.6 (85.5) million. As in the previous year, cash flow has been affected by the completed new share issue.
▪ Earnings per share amounted to -0.19 (-0.31).

THE FIRST NINE MONTHS IN BRIEF
▪ The Group's revenues amounted to SEK 674 M (336.1). An increase of 101%. The Group's organic growth amounted to 42%.
▪ Revenues in the Swedish operations increased to SEK 554.3 (231) million, an increase of 140%.
▪ Revenues in the Chinese operations increased to SEK 119.7 (105.1) million, an increase of 14%.
▪ The Group's profit before depreciation (EBITDA) amounted to SEK 50.3 (87.3) million. The decrease was driven by continued investment in existing operations and is linked to component shortages and increased prices of goods. EBITDA was also negatively affected by non-recurring effects of SEK 11.7 million regarding redemption of minority interests and revaluation of additional purchase prices.
▪ The Group's operating profit (EBIT) amounted to SEK -15.6 (43.9) million. The decrease in operating profit is due, in addition to what is stated in the previous point, to increased
amortization of goodwill, as a direct result of completed company acquisitions, as well as investments in solar energy facilities and investments in existing operations.
▪ Profit for the period after tax amounted to SEK -60.6 (-60.6) million. The result was affected by unrealized exchange rate differences in the Chinese operations by 58.7 (-4.8) MSEK.
▪ The Corona pandemic has affected the Swedish operations mainly in the form of increased transport costs and price increases for, among other things, solar panels. The order entry is still good in the quarter.
▪ The Chinese operations were affected to a lesser extent by the Corona pandemic and, according to the company's estimate, an impact of SEK -1.4 (-2.0) million as a result of the general price reduction on electricity remaining.

SIGNIFICANT EVENTS DURING THE THIRD QUARTER
Sweden
▪ The Board of Directors of Soltech Energy Sweden AB decided on 13 August 2021 to carry out a new share issue of approximately SEK 247 million with preferential rights to existing
shareholders and a possible over-allotment of approximately SEK 150 million. The rights issue was oversubscribed by 166% and the company was thus provided with SEK 397 million before issue costs.
▪ On 22 September, the Board of Directors of Soltech Energy Sweden AB decided to list the ordinary shares in the subsidiary Advanced Soltech Sweden AB on Nasdaq First North Growth Market.
▪ As of August 30, Soltech Energy has acquired 90.1% of the shares in Wettergrens Tak & Plåtslageri AB (Wettergrens) with access on September 2, 2021.
▪ Soltech Energy has decided to merge the operations of the three wholly owned subsidiaries MeraSol AB, Swede Energy Power Solutions AB, and most of the operations in Soltech Sales & Support AB. The new company is called Soltech Energy Solutions 1988 AB.
▪ Soltech Energy's subsidiary, Swede Energy, has entered into an agreement for what will be the Nordic region's largest roof-placed solar cell plant, both in terms of area and power. The area is 65,000 m2.

China
▪ During the quarter, ASAB's subsidiary in China, ASRE, signed new orders amounting to a total installed capacity of 13.6 MW.
▪ At the end of the period, the company had 51 (55) MW in signed orders, as well as projects under processing of 125 (134) MW.
▪ During the period, SEK 71 million was added before issue costs in new issues of preference shares.
▪ The Chinese operations are granted unsecured local bank loans of CNY 40 million (approximately SEK 54 million) at an interest rate of approximately 4.6%.

SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
▪ As of October 1, Soltech Energy has acquired 100% of the shares in the electrical engineering company NEAB Gruppen AB.
▪ Soltech Energy participates in the world exhibition Expo 2020 in Dubai Oct 2021 – March 2022, where Soltech installed a 500 m2 sunroof and 500 m2 sun facade on the Swedish pavilion.
▪ Nomination Committee prior to the Annual General Meeting on 12 May 2022 in Soltech Energy Sweden AB (publ) has been appointed.
▪ On 28 October, the Government decided on an amendment to the ordinance that will be introduced on 1 January 2022, which allows transfer of energy between several units without the requirement for a network concession. It can be expected to improve opportunities and reduce the cost of solar investment in larger properties
▪ On October 29, 2021, Soltech Energy Sweden AB's subsidiary Advanced Soltech Sweden AB (ASAB) was listed on the Nasdaq First North Growth Market. This meant that Soltech Energy AB's ownership interest in the company after IPO and conversion of preference shares decreased from 50.73% to 29.35%. Furthermore, this meant that Soltech Energy Sweden AB no longer has the controlling influence over ASAB and that as of October 29, 2021, ASAB is no longer reported as a subsidiary in the parent company and the group. As of October 30, 2021, ASAB will be reported in the consolidated financial statements as an associated company according to the equity method.

In connection with the special listing, a revaluation result arises in the Group. Preliminarily, the revaluation result amounts to approximately SEK 287 million based on preliminary consolidated values ​​as of the divestment date for ASAB. The revaluation result does not affect cash flow and will be reported in the fourth quarter of 2021.

Following the listing, Soltech Energy Sweden AB owns 11,373,941 number of shares in ASAB with a book value of SEK 27 per share, corresponding to the value per share on the day of the listing. Following the listing, Soltech Energy Sweden AB in the Group reports SEK 307 million in participations in associated companies. Other significant effects on the balance sheet for the Soltech Group are that fixed assets decrease by approximately SEK 1.3 billion, of which solar energy facilities amount to approximately SEK 1.2 billion and that long-term liabilities decrease by approximately SEK 1 billion, of which bond loans amount to approximately SEK 0.9 billion.

Soltech's holdings in ASAB continue to be reported quarterly in operating profit and consist of Soltech Energy Sweden AB's share of profit in ASAB, amortization of surplus values ​​in solar energy plants, deferred tax and currency translation of surplus values.

The share price of ASAB has developed positively since the IPO on October 29, with a closing price on November 29 of SEK 59.6 / share, which corresponds to a value of approximately SEK 640 million for Soltech's shares.