Biesse S p A : INTERIM REPORT AT 30 JUNE 2022

INTERIM REPORT

Biesse S.p.A.

JUNE 2022

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INTERIM REPORT AS AT 30 JUNE 2022
THE BIESSE GROUP.............................................................................................................................................................	4
GROUP STRUCTURE..........................................................................................................................................................	4
GROUP PROFILE ............................................................................................................................................................	5
ALTERNATIVE PERFORMANCE INDICATORS .........................................................................................................	5
FINANCIAL HIGHLIGHTS ..................................................................................................................................................	6
COMPOSITION OF CORPORATE BODIES.......................................................................................................................	8
DIRECTORS' REPORT ON OPERATIONS ..........................................................................................................................	9
GENERAL ECONOMIC OVERVIEW...................................................................................................................................	9
BUSINESS SECTOR REVIEW ..........................................................................................................................................	10
TREND IN THE FIRST HALF OF 2022 ...........................................................................................................................	12
MAIN EVENTS OF THE HALF-YEAR..............................................................................................................................	12
INCOME STATEMENT HIGHLIGHTS.............................................................................................................................	14
STATEMENT OF FINANCIAL POSITION HIGHLIGHTS ..............................................................................................	16
SEGMENT REPORTING ...................................................................................................................................................	18
TRANSACTIONS WITH ASSOCIATES, PARENTS AND THE LATTER'S SUBSIDIARIES.......................................	18
OTHER RELATED-PARTY TRANSACTIONS.................................................................................................................	18
"ATYPICAL AND/OR UNUSUAL" TRANSACTIONS OCCURRING DURING THE SIX-MONTH PERIOD..............	19
SIGNIFICANT EVENTS AFTER THE REPORTING DATE AND FULL-YEAR OUTLOOK .........................................	19
CONSOLIDATED FINANCIAL STATEMENTS AS AT 30 JUNE 2022...........................................................................	21
CONSOLIDATED INCOME STATEMENT ......................................................................................................................	21
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME..............................................................................	22
CONSOLIDATED STATEMENT OF CASH FLOWS.......................................................................................................	24
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY.........................................................................................	25
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS ...........................................	26
1. GENERAL INFORMATION.......................................................................................................................................	26

2. DECLARATION OF COMPLIANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS, BASIS

OF PRESENTATION AND CONSOLIDATION AND FOREIGN CURRENCY TRANSLATION PRINCIPLES ..........	28
3.	MEASUREMENT CRITERIA, USE OF ESTIMATES AND RECLASSIFICATIONS ............................................	30
4.	ADOPTION OF NEW ACCOUNTING STANDARDS, AMENDMENTS AND IFRS INTERPRETATIONS .......	32

1. ACCOUNTING STANDARDS, AMENDMENTS AND IFRS INTERPRETATIONS APPLIED AS OF 1

JANUARY 2022 ............................................................................................................................................................

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1. ACCOUNTING STANDARDS, AMENDMENTS AND IFRS INTERPRETATIONS ENDORSED BY THE EUROPEAN UNION, NOT YET MANDATORILY APPLICABLE AND NOT YET ADOPTED IN ADVANCE BY THE

GROUP AS AT 30 JUNE 2022....................................................................................................................................

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1. ACCOUNTING STANDARDS, AMENDMENTS AND IFRS INTERPRETATIONS NOT YET ENDORSED

BY THE EUROPEAN UNION .......................................................................................................................................	33
5.	REVENUE AND ANALYSIS BY OPERATING SEGMENT AND GEOGRAPHICAL AREA ................................	34
6.	SEASONALITY...........................................................................................................................................................	36
7.	PERSONNEL EXPENSE ...........................................................................................................................................	36
8.	EXCHANGE RATE GAINS AND LOSSES...............................................................................................................	36
9.	TAXES.........................................................................................................................................................................	36
10.	EARNINGS PER SHARE......................................................................................................................................	37
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11.	DIVIDENDS............................................................................................................................................................	37
12.	PROPERTY, PLANT, MACHINERY AND OTHER TANGIBLE AND INTANGIBLE ASSETS .......................	37
13.	GOODWILL ............................................................................................................................................................	38
14.	INVENTORIES.......................................................................................................................................................	38
15.	TRADE RECEIVABLES FROM THIRD PARTIES ..............................................................................................	38
16.	SHARE CAPITAL AND TREASURY SHARES...................................................................................................	39
17.	HEDGING AND TRANSLATION RESERVES ....................................................................................................	39
18.	OTHER RESERVES AND ACTUARIAL RESERVE............................................................................................	39
19.	FINANCIAL LIABILITIES......................................................................................................................................	39
20.	TRADE PAYABLES...............................................................................................................................................	40
21.	CONTRACT LIABILITIES.....................................................................................................................................	40
22.	ACQUISITION OF MINORITY INTERESTS.......................................................................................................	40
23.	COMMITMENTS, CONTINGENT LIABILITIES AND RISK MANAGEMENT................................................	41
24.	CLASSIFICATION OF FINANCIAL INSTRUMENTS........................................................................................	42
25.	SIGNIFICANT EVENTS AFTER THE REPORTING DATE...............................................................................	43
26.	RELATED-PARTY TRANSACTIONS..................................................................................................................	43

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THE BIESSE GROUP

GROUP STRUCTURE

The following companies belong to the Biesse Group and are included in the scope of consolidation:

Note: The different colours represent the subgroups of the control chain

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GROUP PROFILE

The Biesse Group is a leading multinational in processing wood, glass, stone, plastic and metal. It designs, makes and distributes machinery, integrated systems and software for manufacturers of furnishings, windows and doors, building components, boats and planes. It invests 3% of its annual turnover in research and development and has filed over 250 patents. It operates through 14 industrial plants and 34 branches and exports 80% of its production. Among its customers are the most prestigious brands in Italian and international design. It was founded in Pesaro in 1969 by Giancarlo Selci, and since June 2001, it has been listed in the Euronext Star segment managed by Borsa Italiana. It now has more than 4,300 employees distributed across the main production and distribution sites located in Pesaro, Gradara, Padua, Villafranca (province of Verona), Thiene (province of Vicenza), Alzate Brianza (province of Como), Volvera (TO), Bangalore and the branches/representative offices in Europe, North America, Latin America, Middle and Far East Asia, and Oceania.

Compared to the consolidated financial statements for the year ended 31 December 2021, the scope of consolidation has changed following the merger of the subsidiary Bre.Ma. Brenna Macchine S.r.l., previously 98% owned, into the Parent Company Biesse S.p.A. (effective as of 01/01/2022) and the purchase of an additional shareholding in Montresor S.r.l. (through which its controlling interest increased from 60% to 100%) which took place in February 2022. For further details on these transactions, please refer to the section "Scope of Consolidation" in the Notes to the Financial Statements.

Please also note that the purchase of the remaining 40% of the equity investment in Movetro S.r.l. was finalised in May 2022. This transaction did not entail a change in the scope of consolidation as the Company was still consolidated at 100% because it was considered possible to exercise the put/call option on the aforementioned minority interest.

ALTERNATIVE PERFORMANCE INDICATORS

Management uses some performance indicators, which are not identified as accounting measures under the IFRS (non-GAAP measures), to better assess the Group's performance. The criterion applied by the Group to set these indicators might not be the same as that adopted by other groups, and the indicators might not be comparable with those set by the latter. These performance indicators, which were set in compliance with the Guidelines on performance indicators issued by ESMA/2015/1415 and adopted by CONSOB with its communication No. 92543 of 3 December 2015, refer to performance in the accounting period covered by this Annual Report on Operations and the year used for comparison.

The performance indicators must be complementary and not replacing the information prepared under the IFRS. Hereafter is a description of the main indicators adopted.

• Value Added: this indicator is defined as the Profit (Loss) for the year before income taxes, finance income and expense, exchange rate gains and losses, amortisation of intangible assets, depreciation of property, plant and equipment, impairment losses on fixed assets, allocations to provisions for risks and charges, costs and revenues arising from transactions that Management considers as non-recurring relative to the
  Group's ordinary operations, as well as personnel expense.
• Adjusted EBITDA (Adjusted Earnings Before Interest, Taxes, Depreciation and Amortisation): this indicator is defined as the Profit (Loss) for the period before income taxes, finance income and expense, exchange rate gains and losses, amortisation of intangible assets, depreciation of property, plant and equipment, impairment losses on fixed assets, allocations to provisions for risks and charges, as well as costs and revenues arising from transactions that Management considers as non-recurringrelative to the Group's ordinary operations.
• Adjusted EBIT (Adjusted Earnings Before Interest and Taxes): this indicator is defined as the Profit (Loss) for the year before income taxes, finance income and expense, exchange rate gains and losses, impairment losses on fixed assets, as well as costs and revenues arising from transactions that Management considers as non-recurringrelative to the Group's ordinary operations.
• Net Operating Working Capital: this indicator is calculated as the total of Inventories, Trade receivables and Contract assets, net of Trade payables and Contract liabilities.
• Net Working Capital: this indicator is calculated as the total of Net Operating Working Capital and other Current Assets and Liabilities, including Provisions for short-term risks and charges.

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