Humble : Year End Report Humble Group Q4_2022-02-25

YEAR-END REPORT

JANUARY - DECEMBER 2021

STRONG PROFITABILITY AND 42 % ORGANIC

GROWTH

Financial information

Fourth quarter

• Net sales amounted to 862 MSEK (17).
• Organic sales growth for wholly owned subsidiaries in 2021 amounted to 42 % for the fourth quarter.
• Adjusted EBITDA amounted to 152 MSEK (-2).
• Adjusted EBITA amounted to 154 MSEK (-3).
• Adjusted EBITA per share amounted to 0,62 SEK (-0,02).
• EBITDA amounted to 118 MSEK (-16).
• Earnings per share amounted to -0,58 SEK (-0,23).
• Cash flow from operating activities before change in net working capital* amounted to 100 MSEK (-16).

Twelve months

• Net sales amounted to 1 518 MSEK (32).
• Organic sales growth for wholly owned subsidiaries in 2021 amounted to 28 % for the year.
• Adjusted EBITDA amounted to 228 MSEK (-9).
• Adjusted EBITA amounted to 217 MSEK (-12).
• Adjusted EBITA per share amounted to 0,88 SEK (-0,07).
• EBITDA amounted to 162 MSEK (-25).
• Earnings per share amounted to -1,38 SEK (-0,42).
• Cash flow from operating activities before change in net working capital* amounted to 133 MSEK (-27).

Proforma fourth quarter1

• Net sales amounted to 1 043 MSEK.
• Adjusted EBITDA amounted to 170 MSEK.
• Adjusted EBITA amounted to 172 MSEK.
• EBITDA amounted to 135 MSEK.

Proforma twelve months1

• Net sales amounted to 3 749 MSEK.
• Adjusted EBITDA amounted to 492 MSEK.
• Adjusted EBITA amounted to 479 MSEK.
• EBITDA amounted to 370 MSEK.

Significant events during fourth quarter

Significant events after the fourth quarter

• Humble completes acquisitions of Solent Global Ltd, Swedish Food Group AB, Swecarb AB, Carls-Bergh Pharma AB, Soya Oy, Delsbo Candle AB and the remaining shares in AB Fermia.
• Humble signs an agreement with SEB regarding a credit facility of 400 MSEK.
• Humble enters into acquisition agreements with the sellers of BioPak d.o.o, Group 472 Aps (True Gum) and Fitnessgrossisten AS.
• Hans Skruvfors is elected at an extra general meeting as a new ordinary Board member and replaces Mikael Pettersson.

• Humble enters into a letter of intent with MedicaNatumin AB (publ) regarding the acquisition of its operating activities.
• The Board of Directors proposes that no dividend be paid for the financial year 2021.

Fourth quarter

Twelve months

	Proforma	2021	2020
Follow up on financial targets (MSEK)	2021	1
Net revenue	1 043	862	17
Adjusted EBITDA	170		152	-2
Adjusted EBITDA margin	16%		17%	-11%
Adjusted EBITA	172		154	-3

Proforma	2021	2020
2021	1
3 749	1 518	32
492		228	-9
13%		14%	-23%
479		217	-12

Adjusted EBITA margin

16%

17%

-16%

12%

14%

-32%

1. For detailed information regarding proforma, refer to page 3.
   * The presentation of the key ratio has been updated in the fourth quarter of 2021. For more information on cash flow from operating activities before changes in working capital, see page 7.

	Humble Group is a leading FMCG group with a
Humble Group AB Year-End Report January - December 2021	focus on health and well-being.
Stockholm, 25 February 2022
Join us on our humble journey of change!

This report is a translated version of the swedish original and where the swedish info shall prevail in case of any changes.

| COMMENTS FROM THE CEO

POSITIVE OUTLOOK GOING FORWARD

Since we launched the plan to grow with acquisitions in March 2020, we have finally reached a level where our proforma results are consolidated. It is thus very gratifying to be able to present the absolute strongest quarter in the company's history, where we reach net sales of SEK 862 million and adjusted EBITA of SEK 154 million, with an adjusted EBITA margin of 17 %. We also report stable cash flows from our 29 operations and for the companies owned throughout the period, have an organic growth of as much as 42 % for the fourth quarter and 28 % for the entire year, which is a significantly higher level than before they became part of the Group. With the Board's and Management's long-term plan to create value for our more than 22 000 shareholders, we are now showing the real potential in the strategic platform we have built and the market position we have established over the past two years.

Development compared to financial targets

On March 26, 2021, the Board set the first financial targets for the Group in the medium term, which meant that the Group would proforma reach SEK 8 billion in net sales and a 10 % EBITDA margin, corresponding to SEK 800 million by 2025. When the targets were launched, they were considered by many as ambitious and in some cases unreasonable, given that we have just become profitable and had a proforma turnover of SEK 348 million. When we look back on 2021 with the results in hand, we have in less than nine months from the time the targets were launched managed to reach a proforma turnover of R12 of as much as SEK 3.75 billion and adjusted EBITDA of SEK 492 million. For the initial targets, this means that in just 16 % of the time we have grown to a total target fulfillment of 47 % on the sales target and 62 % on the profitability target. It is therefore not surprising that we have had to raise our targets for 2025 not just once but twice since then. Today, we have a target for 2025 of proforma net sales of SEK 16 billion and adjusted EBITA of SEK 1 900 million. Given that we have already achieved almost 25 % of each goal, I am convinced that we will be able to deliver as promised, and hopefully more.

Strategic progress and established platform

When we stepped into 2021, we were still a small company with only a few people in the management team. To enable continued growth and our vision, we have strengthened the parent company on several levels with the necessary functions. Today we have an M&A team on site, our own finance function, our own data analysis center and a team of senior operational managers who contribute with "best practice" from several of the world's leading FMCG large companies such as Orkla, Unilever, Absolut and L'Oréal. I feel an incredible pride in the team we have built in a short time and it is completely bursting with energy and initiative, where we help our entrepreneurs daily to find new opportunities within the Group and assist in executing project challenges in their local operations. It is easy to stare blindly at the fact that we maintain a high acquisition rate and some underestimate the fundamental potential we have by being uniquely positioned in healthy foods and sustainable products in one of the world's largest industries. The market's global forces constitute an exciting climate, where both customers and authorities place higher demands on store chains and suppliers on a daily basis. The fact that Humble Group started from a blank slate and thus has no burdensome former "legacy" to manage, means that we can instead focus on both acquiring and growing the companies that we believe are correctly positioned with the attributes and the

conditions for managing the market's ongoing transformation. This gives us a long-term advantage compared to other large companies in the market, which have difficulty adapting to the pace of innovation required by the market and are unable to restructure their cultures as required to reach a conscious and modern consumer.

The market situation and the rest of the world

Despite a volatile world situation, with everything from the corona pandemic, delivery and shipping difficulties and not least the worrying development regarding the political situation in Ukraine, we see continued stable growth for Humble and potential for an increased profitability margin. It has never been better for our operating companies and there is a consistent momentum in bringing both existing markets and new export investments. An example of how we as a Group can contribute to increased profitability is that during the year, we have centralized several purchasing agreements for all the Group's companies, where we reduce overhead costs and have secured agreements with fixed shipping costs from China and Asia, an item that has weighed on some of the operations during the year.

We are also beginning to see the results of the sales initiatives we started during the year by helping the companies to expand into new channels and internationally. It is easy to forget that the FMCG market is sluggish and that it takes time to get a new product out, while at the same time being a strength that we have in our corner during more difficult times. The FMCG market is not as sensitive to economic conditions as other markets and our ambition is that both sales and associated cash flows will continue to increase in Humble Group, despite the risk of a more troubled macroclimate. The goal is to continue to grow annually with at least 15 % organic growth at Group level. With the development we have had during the past year, it feels like we have found a good recipe to achieve the goal.

The future looks bright

Last week we announced our first planned acquisition for the year, with the intention of acquiring the operating entities of the MedicaNatumin Group. It is an interesting step for us where we get an even more significant position in the sports nutrition and dietary supplement segment - a market that is growing strongly and in which we have had time to acquire several businesses during the year. Our goal is to become an attractive overall supplier for the FMCG products of the future, and with the companies in the Group, we have already begun to become a significant player to be reckoned with. We also notice that there is a huge interest from companies that want to be part of Humble Group and our ambition is to make more acquisitions and at least achieve the same development both in terms of sales and earnings in 2022 as in the last 12 months.

Finally, I would like to thank the board, the owners, and the team for the confidence to lead the Humble Group. Together we have started the journey by building something big and when we look back in next year's report, I hope that we have even more enthusiastic shareholders with us and that we are seen as an innovative upstart in the industry.

Simon Petrén

CEO Humble Group

Stockholm, 25 February 2022

Humble Group AB Year-End Report January - December 2021

| SUMMARY

FINANCIAL DEVELOPMENT PROFORMA

Overview of net sales and adjusted EBITDA proforma

Net sales proforma

Net sales proforma for the fourth quarter amounted to a total of 1 043 MSEK, which is an increase of 171 MSEK compared with the previous quarter. During the past 12 months (R12), net sales have grown sharply and amounted to 3 749 MSEK after the fourth quarter, which is an increase of 399 MSEK compared with the previous quarter. The wholly owned companies in 2021 had a very positive sales development with 42

• organic growth for the fourth quarter and 28 % for the entire year. The companies show higher growth than before they became part of Humble Group and several of the companies have benefited from synergies through cross-selling and joint purchasing. The companies that were not owned throughout 2021, but acquired during the period, also had high organic growth and several of the companies have implemented group-wide business initiatives and show higher growth than before. In general, Humble Group had a slightly lower acquisition rate during the fourth quarter, where the focus has been on consolidation and integration of functions. The ambition is for the company to maintain at least as high an acquisition rate in 2022 as in 2021.

Adjusted EBITDA proforma

Adjusted EBITDA for the third quarter amounted to 170 MSEK, an increase of 49 MSEK compared with the previous quarter. For 2021, adjusted EBITDA amounted to 492 MSEK, an increase of 43 MSEK compared with the previous quarter. During the past 12 months (R12), profitability has strengthened sharply in the Group. A large part of the improvement in profitability is due to increased net sales, joint cost savings and synergies in the form of purchasing and supply chain. During the fourth quarter and full year 2021, some of the companies exposed to purchases from China and Asia had extraordinarily high shipping costs, with an increase of up to 1 000 % compared with normal levels in previous years. These have been adjusted to some extent for 2021 and the fourth quarter. Humble has also concluded a framework agreement at Group level which ensures that shipping costs will return to more normal levels in 2022, where the reduction compared to 2021 is estimated at about -60 % of the total shipping costs and thus does not need to be adjusted for the future.

Of total adjustments in the fourth quarter of 35 MSEK, 11 MSEK is increased shipping costs, and the remaining part of 24 MSEK is attributable to acquisitions made during the year.

Humble Group AB Year-End Report January - December 2021

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| SUMMARY

Fulfillment of our financial targets

The Board of Directors of Humble Group decided on 11 August 2021 to increase the financial growth target to a net turnover of SEK 16 billion proforma (increase by 100 % from the previous SEK 8 billion) with a target of 15 % organic growth per year (increase by 50 % from the previous 10 % per year) and to raise and replace the previous profitability target with a fixed adjusted EBITA target of SEK 1.9 billion proforma (increase of 150 % compared with previous profitability target of 10 % adjusted EBITDA margin). The increases in the financial targets are taking place against the background of stronger growth than previously forecast.

During the year, Humble Group conducted a higher acquisition rate than estimated, largely driven by a positive response and reception from all involved entrepreneurs and relevant market participants who want to become part of the Group. We also see an improved balance sheet from the financing rounds conducted during the spring and good opportunities to maintain a continued strong capital structure despite a high acquisition rate. Other financial targets and the time period for the medium-term targets (2025) remain unchanged.

At the end of the third quarter of 2021, the Group's proforma net sales for rolling 12 months amounted to 3 749 MSEK. This corresponds to 23 % target fulfillment of our long-term financial target that proformed net sales will amount to SEK 16 billion by the end of 2025.

Adjusted EBITA proforma amounted to 479 MSEK, which corresponds to 25 % target fulfillment that proformed adjusted EBITA will amount to 1 900 MSEK at the end of 2025. The graphs below illustrate Humble Group's development and degree of fulfillment of the financial targets 2025 at the end of the current accounting period and should not be interpreted as a forecast for future development.

NET SALES

ADJUSTED EBITA

To the right is presented how the adjusted proforma EBITDA margin has developed historically for R12. At the end of the quarter, the adjusted EBITDA margin LTM amounted to 13.1 %.

Humble Group AB Year-End Report January - December 2021

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| SUMMARY

SEGMENT REPORT

Food & Snacks

The segment includes the companies Amerpharma, Grahns Konfektyr, Green Sales Distributions, Kryddhuset i Ljung, Monday 2 Sunday, Nordfood International, Bayn Production, Swedish Food Group, Soya OY, Solent Global Ltd*, True Gum, Tweek and Wellibites. The companies' focus is on recipe development and the development of tomorrow's modern foods that are in some way better for humans or the planet. For example, there is a strong focus today on sugar-reduced products, where it is also important to maintain a high quality and taste that challenges the industry and competes with traditional products. Humble Group has a leading position today in several of its markets with a clear majority of sales of sugar-free/reduced snacks and confectionery products. The market for healthier foods has strong underlying growth. Sales of sugar- free/reduced confectionery products are currently less than 1 % of total confectionery sales, a figure that we see is changing at a rapid pace. The historical development in more mature categories such as vegan milk substitutes and functional foods indicates that there will be continued strong growth in other newer growth segments as well. In 2021, the segment experienced very strong growth and improved profitability in the Group, and we see continued increasing demand from both customers and consumers.

Personal- & Home Care

The segment includes Solent Global Ltd*, The Humble Co., Naty, BeSon Gross, Delsbo Candle, Fancystage and Marabu Markenvertrieb. The companies' focus is to provide a broad portfolio of Personal & Homecare products where the consumer is offered a better type of products and where sustainability and reduced environmental impact are in focus. Several of the products are world leaders in their field, such as Humble Co's natural oral care products as well as Naty's compostable and sustainable children and female care products. The segment is characterized by strong gross margins and high growth in the underlying macro trend. The market for this type of FMCG product is expected to continue to grow strongly and the proportion of products that are sustainable or have a reduced environmental impact still constitutes only a fraction of the total market in each segment. In 2021, the segment had stable growth. Profitability has been negatively affected by extraordinarily increased shipping costs, which are expected to return to normal levels in 2022, partly due to the framework agreement the Group has signed to ensure lower shipping costs, and partly the reduced price volatility that we see in the market since the turn of the year.

Sports Nutrition & Ingredients

The segment includes Carls-Bergh Pharma, Ewalco, Golden Athlete, Nordic Sports Nutrition, Performance R Us, Swecarb and Viterna. The companies' focus is to become an attractive comprehensive supplier for health-promoting sports nutrition and dietary supplement products in manufacturing, brands, and distribution. Today, Humble Group has a portfolio of tablets, capsules, powders, and ingredients and is expected to grow the segment to more verticals during 2022. The market for functional foods and supplements has had high organic growth in recent years. The company sees a continued stable increase in demand and several of our manufacturers have had a higher order intake and demand than has been possible to meet. The prices of protein powder have increased sharply in 2021 and the companies have been successful in adjusting output prices to customers in line with the increased costs. The segment has had strong growth during the year while maintaining its profitability margin.

Humble Group consists of the segments Food & Snacks, Personal Care & Home Care, Sports Nutrition & Ingredients and Other (the parent company). The table below shows the consolidated net sales and EBITDA per segment as well as the proportion of internal net sales that has been eliminated in the consolidated accounts.

		Fourth quarter				Twelve months
MSEK	2021		2020		2021		2020
Net sales
Food & Snacks	326	38%	2	50%	662	44%	26	81%
Personal- & Home Care	424	49%	0	0%	617	41%	0	0%
Sports Nutrition & Ingredients	112	13%	2	50%	239	16%	6	19%
Other	0	0%	0	0%	0	0%	0	0%
Total net sales	862	100%	4	100%	1 518	100%	32	100%
Internal net sales eliminated in group accounting	121	12%	12	76%	207	12%	18	36%
Depreciation and Amortisation
Food & Snacks	25	21%	-2	33%	43	27%	-12	48%
Personal- & Home Care	87	74%	0	0%	112	69%	0	0%
Sports Nutrition & Ingredients	13	11%	-2	33%	25	15%	-6	24%
Other	-7	-6%	-2	33%	-18	-11%	-7	28%
Total EBITDA	118	100%	-6	100%	162	100%	-25	100%

* Solent Global Ltd has a broad product portfolio whose sales are included in both segments Food & Snacks and Personal Care & Home Care.

Humble Group AB Year-End Report January - December 2021

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