Blue Cap : 2022 Half-Year Report

BLUE

DEVELOPING PORTFOLIO COMPANIES. CAP CREATING VALUE.

2022 half-year report

EMPOWERING TRANSFORMATION

BLUE CAP

CONTENTS

GROUP KEY FIGURES

DEVELOPING PORTFOLIO COMPANIES. CREATING VALUE.

• Letter to our shareholders

• Company and business model
  6 Highlights
  8 Blue Cap on the capital market

12_ INTERIM GROUP MANAGEMENT REPORT

31_ INTERIM CONSOLIDATED FINANCIAL STATEMENT

57_ FURTHER INFORMATION

1. Adjusted consolidated income statement
2. Contact, financial calendar and legal notice

GOOD TO KNOW You can find the adjusted

consolidated income statement on page 58

GOOD TO KNOW You can find more

details about the NAV starting on pages 10 and 14

EUR thousand

		H1
		2022		H1 2021	Change in %
Revenue		173,321		120,778	43.5
Adjusted EBITDA*		17,668		10,466	68.8
Adjusted EBITDA margin in %*		9.9		8.4	17.4
Adjusted EBIT*		11,132		5,261	>100
Adjusted EBIT margin in %*		6.2		4.2	47.4
Consolidated net income		14,770		1,453	>100
Cash flow from operating activities				4,651	>100
-4,619
Cash flow from investing activities	-3,669		3,199	>100
Earnings per share in EUR	3.36		0.36	>100
		30 June	31 December
		2022
	2021	Change in %
Total assets		311,150		268,035	16.1
Net asset value in EUR million		168.5		172.8	2.5
Equity		111,609		98,243	13.6
Equity ratio in %		35.9		36.7	2.1
Working capital (net)**		76,665		60,937	25.8
Net debt ratio in years***		2.5		2.6	3.8
Average no. of employees in the Group		1,300		1,122	15.9
Average no. of employees in the
holding company		13		13	0.0

* Adjustments: Adjusted to reflect extraordinary, prior-period and other effects resulting from reorganisation measures and one-off effects, as well as effects arising from the purchase price allocations

• incl. contract assets and contract liabilities
• The reported net debt ratio (in years) represents debt less cash in relation to adjusted EBITDA over the last twelve months.

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BLUE CAP		EMPOWERING	INTERIM GROUP	INTERIM CONSOLIDATED FINANCIAL	FURTHER
	TRANSFORMATION	MANAGEMENT REPORT	STATEMENT	INFORMATION

_ LETTER TO OUR SHAREHOLDERS

LETTER TO OUR SHAREHOLDERS

Dear Shareholders,

Blue Cap AG performed well in the first half of 2022 - despite the economic burdens and uncertainties from which our group of companies is not unaffected. However, current events are affecting the business development of our portfolio companies to varying degrees.

The fact that we have further optimised and diversified our portfolio over the past two years is paying off today. Despite the bur- dens, we can look back on a good first half of 2022 and have again grown strongly and profitably. Consolidated revenue increased to EUR 173.3 million (previous year: EUR 120.8 million), and the adjusted EBITDA grew significantly as well to EUR 17.7 million (previous year: EUR 10.5 million). The Plastics segment contributed particularly to the organic development. An acquisition-driven, very pleasing effect comes from the newly created Business Services segment which we have built up over the last twelve months.

This improvement across the entire Group was only possible thanks to the great commitment of all our employees in the Group. They deserve our special thanks at this point.

The Blue Cap portfolio continued to grow in the first half-year 2022: In March, we announced the acquisition of the Transline Group, which is backed by a clear buy-and-build strategy. We took a step closer to our goal of developing the company into one of the largest translation service providers in the German-speaking world in June with the acquisition of Micado as an add-on.

Even though the year so far has been strongly influenced by the current geopolitical events and their economic consequences, which occupy us operationally every day, we have not lost sight of one topic: Sustainability. The protection of our environment has a high priority for us and is a central component of the Blue Cap sustainability strat- egy. We explain these goals and our ESG work in detail in our first sustainability report, which was prepared in accordance with the German Sustainability Code and published in May 2022. The focus of our ESG work this year is on starting to develop a CO2 reduction strategy together with our portfolio companies.

Contrary to the predominantly positive news we have reported in recent months, our share cannot escape the general downward trend on the stock markets. Compared to the German share indices and looking back at the last few years, our share performance is certainly respectable. However, we are aware that the latest development does not satisfy you, dear shareholders. And we also see considerable upside potential here. We will therefore continue to consistently pursue our goal of significantly increasing our net asset value and market

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BLUE CAP		EMPOWERING	INTERIM GROUP	INTERIM CONSOLIDATED FINANCIAL	FURTHER
	TRANSFORMATION	MANAGEMENT REPORT	STATEMENT	INFORMATION

_ LETTER TO OUR SHAREHOLDERS

capitalisation, while continuing the intensive capital market communication we have built up over the past two years.

All in all, we look forward to the coming months with confidence. This confidence is fuelled by a portfolio that we have made more sustainable and heterogeneous over the past two years. Nevertheless, developments that are difficult to predict in the medium term require us to focus even more on portfolio work. We will keep an eye on current events and risks and actively manage them together with the management teams of our portfolio companies. Transformation is the key- word, and profitable growth the objective. The focus of the next few months will therefore be on our portfolio companies in order to make them even more crisis-resistant. Our M&A team will focus on smaller add-on acquisitions.

Just over four weeks ago, we announced changes in the Management Board team. In addition to creating a CEO position, which ­T­obias Hoffmann-Becking will hold in the future, Henning Eschweiler will take over the role of COO for Ulrich Blessing from 1 September 2022. Mr Eschweiler has many years of experience in the German SME sector and in the private equity sector. With his outstanding expertise in the area of growth and value enhancement programmes, he has precisely the skills that are necessary and valuable for the further ­operational development of our portfolio companies. We are excited about his first impulses and look forward to working with him. Matthias Kosch remains CFO of our group of companies. With this new Management Board structure, we feel that we are ideally positioned to meet the current challenges.

Let us conclude by expressing our gratitude to you, dear shareholders. Living up to your trust is our daily incentive. We are confident that Blue Cap AG is strongly positioned for the coming years and would be very pleased if you would accompany us on our further journey.

Munich, August 2022

Your Management Board

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BLUE CAP		EMPOWERING	INTERIM GROUP	INTERIM CONSOLIDATED FINANCIAL	FURTHER
	TRANSFORMATION	MANAGEMENT REPORT	STATEMENT	INFORMATION

_ OUR BUSINESS MODEL

OUR BUSINESS MODEL

BUY, TRANSFORM & SELL

As an investment company, Blue Cap AG acquires and supports SMEs from the B2B sector that have clear potential for improving their earnings and growth prospects.

"BUY":

STRUCTURED M&A PROCESS

Our acquisition activities are characterised by the systematic identification and selection of target companies and a structured M&A process. The initial situations are as diverse as the companies we acquire. However, we always apply one general prin- ciple: We adapt to individual circumstances and put the well-beingof the company in the foreground. In doing so, we pay attention to the corporate culture and the employees.

"TRANSFORM":

FURTHER DEVELOPMENT DRIVEN BY OUR PORTFOLIO COMPANIES

The portfolio companies are managed independently by the management teams and keep their established SME identity. In principle, each company pursues its own strategy. At the same time, the portfolio companies receive close support from Blue Cap with their strategic and operational

Our focus: Medium-sized enterprises in the B2B sector

_ Fundamentally intact core business

• Attractive positioning in a market niche
• Registered office in Germany, Austria or Switzerland
• Annual revenue: EUR 30 million to EUR 80 million
• Majority stake
• Potential for commercial improvement
• Growth opportunities (organic and inorganic)
• Compatibility with sustainability objectives

development. The transformation can include optimising cost structures and margins as well as securing and expanding the company's financial capacity to act (liquidity). Growth through innovation and the strengthening of sales activities are also the focus of our activities. Strategically, digitalisation and sustainability often play a prominent role because they are an important prerequisite for competitiveness for almost all companies.

"SELL":

SALE AS PROOF OF CONCEPT

Blue Cap generally only steps in as a temporary owner and follows a best-owner approach. When it appears to make more sense to allow the company to continue on its path with a new ownership structure, Blue Cap can also sell its shares in the portfolio companies. With the sale, we realise an increase in value - as a proof of concept, so to speak. It proves that our investment theses for this enterprise have worked out. The company has become more valuable and its business model holds further potential for a new owner.

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