Technogym S p A : Press release financial results 2021

TECHNOGYM S.P.A.: BOARD OF DIRECTORS APPROVED THE DRAFT CONSOLIDATED RESULTS

FOR THE 2021 FINANCIAL YEAR

TECHNOGYM GROWS BY 20%

• CONSOLIDATED REVENUE: Euro 611 million, +20.0% Vs 2020
  At constant exchange rates: +20.5% Vs 2020
• EBITDA Adjusted: Euro 107 milioni, +11% Vs 2020
• NET PROFIT Adjusted: Euro 51 million, +18% Vs 2020
• NET FINANCIAL POSITION: Euro +96 million at year end, improving from Euro +59 million in 2020
• Proposed dividend of Euro 0.16 per share (totaling Euro 32 million)

Nerio Alessandri, President and CEO, declared:

"For 40 years we have been working every day with the aim of being innovative, different and better. Now, more than ever, it becomes clear the uniqueness of our positioning and business model "Technogym - The Wellness Company".

The Technogym team has been able to adapt, quickly, with passion and sense of responsibility to the demand evolution in the different market segments. 2021 marked a gradual return to normality, with a strong recovery in BtoB, an overall turnover of + 20%, an EBITDA of 120 million and a strong cash generation.

All over the world, people have returned to training in the gym faster than expected, with a strong "connected fitness" attitude, gained during the lockdown. Despite the quick fitness club re-start, home wellness still maintained double-digit growth rates. People train at the gym, at home, at work and on- the-go, also connecting to their own personalized training program for fitness and sport. This consumer lifestyle represents an extraordinary opportunity for Technogym thanks to its industry unique connected ecosystem able to offer engaging on-demand training experiences.

In 2021 Technogym deployed the highest investments in innovation in its history with the aim of supporting industry operators to evolve their offer towards new business models, able to offer customers new value-added services, thanks to a wide range of solutions for the different needs and trends.

Excellence and innovation, quality, design and sustainability have always been the core values behind the Technogym brand, which was appointed Official Supplier to the Olympics for the eighth time, supports Ferrari F1 team and has launched a collaboration with Dior.

Looking to the future, despite the uncertainties related to the dramatic geopolitical scenario, we are positive about the wellness industry, since technology-driven physical exercise is essential to ensure long term results in wellness, sport and health. In addition to the fitness clubs reopening, the resumption of travel and work in the presence stimulate new projects in the hospitality and corporate wellness segments.

Technogym has always been committed to sustainability issues, as wellness is our mission: "Healthy People, Healty Planet."

Cesena (Italia), March 23th 2022 - The Board of Directors of TECHNOGYM (TGYM.MI), a leader in the international fitness, sport and health equipment market and operating in the broader Wellness industry, today examined and approved the consolidated financial statements and the draft financial statements for 2021, prepared in accordance with the International Financial Reporting Standards IAS/IFRS.

The year 2021 was characterized by the progress of the vaccination campaign against Covid-19 in many countries, which allowed a gradual easing of restrictive measures. Thanks to the reopening of many activities, the climate of greater optimism recorded among several economic players and the ever-increasing interest in Wellness, Technogym recorded a significant revenue growth, supported by a strong recovery in the BtoB segments from the second quarter.

In terms of Adjusted EBITDA, there has been an increase compared to last year due to higher sales volumes and price increases effective from May 2021. These price increases have partially contained the negative impacts of higher raw material, logistics and energy costs in fiscal 2021; given the nature of the business, it will take a few months for the Group's revenues to fully benefit from the price increases.

The net financial position improved significantly compared to 2020 thanks to the significant cash generation recorded during the year, which enabled Technogym to increase its net cash position at the end of the year to Euro 96 million, despite an acceleration in investments, which are strategic for the company's medium/long-term development.

Net income improved compared to 2020 leading to a shareholder remuneration of Euro 0.16 per share.

On the innovation front, in 2021 Technogym further developed its ecosystem and added new software and digital content including Mywellness app 6.0 and the Technogym App. The former is an open CRM software platform that enables the club to improve the customer experience and increase attraction and retention by providing the consumer with a higher level of personalization of the center experience. Technogym App on the other hand establishes a direct dialogue with the final consumer, providing him/her with an A.I. based smart coach that can support everyone in achieving their fitness, health or sports goals by adapting to the available equipment available in the different training locations.

Finally, we would like to remind you that today the Technogym Ecosystem, a key and essential element of the company's on-the-go strategy launched in 2012, is accessible in several tens of thousands of equipped centers and counts more than 21 million end users registered on the Mywellness platform.

2021 Financial results

Consolidated results have been prepared in compliance with the International Reporting Standards issued by the International Accounting Standards Board and include the effects of the IFRS 16 accounting standards.

A brief overview of consolidated revenues, based on the type of customer, geographical area and distribution channels, as well as other key economic and financial data is provided below.

1) Revenue

Total revenue for the year were Euro 611.4 million, +20.0% Vs 2020 (+20.5% at constant exchange rates) thanks to further growth in the BtoC customer segment and a marked recovery in the BtoB segment.

Here below is provided a brief analysis of revenue by:

• customers
• geographical areas
• distribution channels

Revenue by client category

		Data as of Dec 31st
(In thousands of Euro and percentage of total revenue)
	2021	2020	2021 vs 2020	%
BtoC	181,706	154,129	27,577	17.9%
BtoB	429,705	355,550	74,155	20.9%
Total Revenues	611,412	509,679	101,733	20.0%

Revenue as of December 31 confirm the growth of the Private customer segment compared to last year (+17.9% Y/Y) thanks to the wide range of Technogym products and services in line with the solid demand for at-home training. At the same time, there was a significant recovery in the Commercial business (+20.9% Y/Y), which accelerated strongly, particularly in recent quarters. It's worth noting the performance of the Health segment, which represents the BtoB sector that is recovering faster the pre- pandemic level of turnover.

Revenue by geographic areas

	Data as of Dec 31		Changes
(In thousands of Euro and percentage of total revenue)
	2021	2020	2021 vs 2020	%
Europe (ex Italy)	291,122	247,875	43,247	17.4%
APAC	110,782	88,343	22,439	25.4%
North America	69,042	57,304	11,739	20.5%
Italy	63,032	59,789	3,244	5.4%
MEIA	62,333	42,866	19,468	45.4%
LATAM	15,100	13,505	1,596	11.8%
Total Revenues	611,412	509,679	101,733	20.0%

In a scenario in which all geographical areas continued to feel, at least in part, the impact of the pandemic, the double-digit performances recorded in almost all parts of the world highlight the acceleration of recovery in the BtoB segment during the last few quarters of the year and a general need for wellness that knows no borders. Turning to individual markets, growth of over 20% Y/Y was reported in the UK, China and Benelux. The return to normality in almost all markets is also reflected in the recovery of orders from various key accounts in the Club and Hospitality segments.

Revenue by distribution channel

	Data as of Dec 31	Changes
(In thousands of Euro and percentage of total revenue)
	2021	2020	2021 vs 2020	%
Field sales	374,290	325,035	49,255	15.2%
Wholesale	145,322	102,358	42,964	42.0%
Inside sales	79,500	70,009	9,491	13.6%
Retail	12,300	12,277	23	0.2%
Totale Revenues	611,412	509,679	101,733	20.0%

As regards the turnover by sales channel, it's worth noting the strong performance of the wholesale channel, driven in particular by APAC (especially South Korea, Thailand and Malaysia), MEIA (excellent performance in Saudi Arabia, Turkey and India) and Europe (mainly in the central-northern area). There was a good rebound in the Field Sales channel, reflecting the gradual return to normality already mentioned, also supported by the growing productivity of the sales network. The channels most exposed to home fitness, Inside Sales and Retail, compare with a 2020 positively impacted by the pandemic. Despite this, there was double-digit growth in Inside Sales, which includes teleselling and e-commerce channels, driven in particular by the strong expansion of e-commerce not only in Europe but also in the USA and China.