===== SIDA 1 ===== YEAR END REPORT OCTOBER – DECEMBER 2023 ===== SIDA 2 ===== YEAR-END REPORT JANUARY – DECEMBER 2023 Humble Group AB Year-end Report January - December 2023 Stockholm, February 19, 2024 A STRONG FINISH TO A TRANSFORMATIVE YEAR Financial information Fourth quarter • Net sales amounted to MSEK 1,936 (1,606). • EBITDA amounted to MSEK 184 (143). • EBITA amounted to MSEK 156 (119). • EBIT amounted to MSEK 66 (62). • Adjusted EBITDA amounted to MSEK 190 (179). • Adjusted EBITA amounted to MSEK 162 (155). • Adjusted EBIT amounted to MSEK 72 (98). • Cash flow from operating activities amounted to MSEK 285 (246). • Profit and loss after tax amounted to MSEK -11 (-18). • Earnings per share before and after dilution amounted to SEK -0.02 (-0.06). • Adjusted EBIT per share amounted to SEK 0.16 (0.33). Twelve months • Net sales amounted to MSEK 7,050 (4,800). • EBITDA amounted to MSEK 659 (504). • EBITA amounted to MSEK 547 (419). • EBIT amounted to MSEK 318 (257). • Adjusted EBITDA amounted to MSEK 696 (551). • Adjusted EBITA amounted to MSEK 584 (466). • Adjusted EBIT amounted to MSEK 355 (304). • Cash flow from operating activities amounted to MSEK 1,088 (255). Adjusted for tax deferrals of MSEK 260, the cash flow from operating activities was MSEK 828. • Profit and loss after tax amounted to MSEK -106 (-36). • Earnings per share before and after dilution amounted to SEK -0.28 (-0.13). • Adjusted EBIT per share amounted to SEK 0.94 (1.07). Significant events During the fourth quarter • Humble Group enters into agreements regarding sale of properties. First part of the sale is completed in December and is structured as a sale and leaseback transaction. • Humble Group enters into a binding agreement regarding sale of all shares in Bayn Production AB. After the quarter  Humble Group completes the sale of all shares in Bayn Production AB as part of the Groups long-term strategy to streamline the operations. Financial overview Humble Group is a leading FMCG Group comprising 47+ entrepreneurial driven entities, with focus on health and well-being in a sustainable way M SEK 2023 2022 2023 2022 Net sales 1,936 1,606 7,050 4,800 Gross profit 614 478 2,129 1,532 Gross margin 32% 30% 30% 32% EBITDA 184 143 659 504 Adjusted EBITDA 190 179 696 551 EBITA 156 119 547 419 Adjusted EBITA 162 155 584 466 EBIT 66 62 318 257 Adjusted EBIT 72 98 355 304 Cash flow from operating activities 285 246 1,088 255 Earnings per share before and after dilution (SEK) -0.02 -0.06 -0.28 -0.13 See page 26 for definition and calculation of key ratios Twelve monthsFourth quarter ===== SIDA 3 ===== | SUMMARY Humble Group AB Year-end Report January - December 2023 2 A STRONG FINISH TO A TRANSFORMATIVE YEAR Humble Group continues to grow and we take market shares through increased distribution, more products and new collaborations in international markets. With an operational cash flow of SEK 285 million (246), we see the result from the continued focus to optimize the flow of goods. Thanks to the improved capital structure and lowered interest costs, we begin to form a picture of how we will be able to generate a positive free cash flow going forward that can be used for value-creating activities, something I have personally had as a milestone since the foundation of the Group. Net sales of SEK 1,936 million (1,606) represent a stable increase from the previous year and organic growth amounted to 18%. The profitability measured in adjusted EBITA of SEK 162 million (155) is in line with our expectation and the margin is somewhat pressured by our increased market efforts and the integration processes that we started during the autumn. We are not afraid to take short-term costs for long-term value creation. Investments in an additional two or third shifts in several of our factories are costly, but at the same time something that means that we will get a higher capacity utilization of the machine park and enable increased growth going forward. The work to improve the gross margin is moving in the right direction and continues to be a focus for all our operations, but there is a long way to go before we reach previous levels. During the autumn, we started to launch a selective consolidation strategy, where certain smaller operations are integrated into larger platforms. I am satisfied with the progress we have made in the consolidation process, as many as six companies have become part of a larger machinery and we see good conditions to utilize economies of scale and streamline the value chain. By becoming a larger player in each sub- segment, we gain competitiveness towards the trade and enable several classic synergy effects such as e.g. increased distribution, joint purchasing and pricing, for a more efficient supply chain. An excellent example of this is the Group's latest joint project of the operating companies Solent Group (offline retail) and Go Superfoods (online retail, Amazon), where we complement the respective sales structure effectively and will roll out each product portfolio to more channels and customers. We have made progress in the development of the commercial B2B platform within Future Snacking and Quality Nutrition, with Arena Nutrition and Arena Confectionery as the spearhead for Nordic manufacturing of high-quality products in health and sustainability. Here we see potential in working closely with our customers and our incubator, and then using the Nordic Distribution segment in an agile way to test innovations and products in the market. During the year, we have created several exciting brand projects internally and my ambition is that we will be able to show some of them to the market already this spring. There is a constant effort to keep track of trends that arise in the FMCG world and it is clear that trade today does not have the right infrastructure required to be able to capitalize on fast- growing (and sometimes short-term) trends from e.g. TikTok and Instagram. Here, our intention is to be a dynamic player that can quickly act on an opportunity and offer the right product at the right time. In Humble we have a network of over 300 contract manufacturers and a large international distribution platform. This makes us an interesting partner for smaller entrepreneur-led companies that have found a "super product", but that do not have the resources, speed or knowledge to scale it to more than a few markets. Humble's price-fighter and private-label business continues to gain ground and it is clear that many clients are satisfied with the concept we offer. Our subsidiary Solent Group leads the way in this segment and we have many exciting opportunities ahead. However, we are still working to refine the strategy and capitalize more quickly on the different opportunities in new markets. I am convinced that we will have improvements in this area in the coming years and we have already started to see results of the cooperation in e.g. The Nordic countries. The fourth quarter is seasonally the largest for the Group and we are expected to be able to deliver both a good result and stable cash flow. Considering how many areas we are adapting and changing in order to create long-term conditions for higher profitability and growth, it is therefore particularly gratifying that it has not taken too much focus from the core business and that we have maintained a good momentum in all segments. The macro trend for products with a health and sustainability angle is maintained strong, where e.g. sports nutrition in Sweden grew by 9% in 2023, which should provide us with a tailwind going forward. A strategic goal is to create the conditions and structure internally to be able to grow with both the trend and take market shares from existing players. Given that we today have a far higher demand from external customers for our products than our factories have the capacity to deliver, there is no doubt that there are many companies that see us as a future B2B-partner to ally with. With the cost-intensive indebtedness at the start of the year following sharply increased market interest rates, cash flow has been the main target to improve in Humble during 2023. It is therefore pleasing to see the strong end to the year with increased operating cash flow in 2023 from SEK 255 million to SEK 1,088 million (SEK 828 million excluding tax deferral). The deployable cash flow has also been strengthened from SEK -99 million to SEK 486 million, largely driven by economies of scale, release of net working capital and the new capital structure. We still have many areas of improvement in net working capital management, but there is a significant difference in efficiency now compared to previous years. Finding a success formula for cash flow optimization in the Group is a powerful tool when we continue to create value among the new acquisitions that will become part of Humble in the future. Overall, we enter into 2024 with optimism and full focus on what lies ahead. The macro climate continues to be turbulent and we closely monitor sensitive areas such as the turmoil with the shipping crisis in the Red Sea and increased cocoa prices. It’s exciting to be part of the development of the Group's growth initiatives, such as investments in everything from a new beverage line and bar producer in Australia, to technologies for new candy products and home-care that will roll out in stores. Those who have followed us for a while know that we have a penchant for innovation and it would be disappointing if we do not see several new successes in the Humble portfolio by the same period in 2025. In conclusion, I would like to take the opportunity to thank all shareholders and our fantastic employees, for your fighting spirit during a both tough and rewarding year. The company has taken great strides in terms of maturity and it is you who make the difference - together we continue the journey towards building the FMCG group of the future. Simon Petrén CEO Humble Group Stockholm, February 19, 2024. ===== SIDA 4 ===== | CONSOLIDATED DEVELOPMENT Humble Group AB Year-end Report January - December 2023 3 HUMBLE GROUP’S FINANCIAL DEVELOPMENT FOURTH QUARTER REVENUES Net sales Net sales for the quarter amounted to MSEK 1,936 (1,606), an increase of 21% compared to the corresponding period last year. The change is attributable to completed business acquisitions of 4%, organic growth for the wholly owned subsidiaries in both periods of 18% and currency impact was -2%. EXPENSES Other external expenses Other external expenses for the quarter amounted to MSEK -250 (-189), which corresponded to 13% (12) of net sales. Acquisition related costs for the quarter amounted to MSEK 0 (-10). Personnel expenses Personnel expenses for the quarter amounted to MSEK -222 (-196), which corresponded to 11% (12) of net sales. Personnel expenses were negatively impacted by consideration linked to employment (stay-on-bonus and lock-in penalties) of MSEK -10 (-13). Remaining increase is mainly explained by additional employees in the Group through the acquired subsidiaries. For more details, please refer to Note 7 Items affecting comparability. Depreciation and amortization Total depreciation and amortization for the quarter amounted to MSEK -118 (-81), which corresponded to a change of 47% compared with the corresponding period last year. Depreciation of right-of-use assets amounted to MSEK -17 (-14) for the quarter. Amortization of assets related to acquisitions, of which a vast majority related to customer relations, amounted to MSEK -37 (- 35). Amortisation of intangible fixed assets for the fourth quarter was negatively affected by an impairment of -35 MSEK due to Fancystage which is undergoing a strategic development for its operations to strengthen the profitability long term, and by -6 MSEK due to impairment of Goodwill for Bayn Production. Financial expenses Financial expenses for the period amounted to MSEK -67 (-83). Interest expense related to unwinding of discounting effect of contingent considerations and other liabilities presented at fair value amounted to MSEK -13 (-24). Such interest expense has no cash effect in the quarterly result. For more details, please refer to Note 6 Financial expenses. RESULTS EBITA Adjusted EBITA amounted to MSEK 162 (155), which corresponded to a change of MSEK 8 for the period. EBITA for the quarter amounted to MSEK 156 (119), which corresponded to a change of MSEK 37 compared with the corresponding period last year. For more details, please refer to Note 7 Items affecting comparability. EBIT Adjusted EBIT amounted to MSEK 72 (98), which corresponded to a change of MSEK -26 for the period. EBIT for the quarter amounted to MSEK 66 (62), which corresponded to a change of MSEK 3 compared with the corresponding period last year. CASH FLOW Cash flow from operating activities Cash flow from operating activities amounted to MSEK 285 (246). Cash flow from operations was impacted by net working capital release of MSEK 156 (64). The Group has during the quarter continued the work with several strategic initiatives to optimize the net working capital usage going forward. ===== SIDA 5 ===== | CONSOLIDATED DEVELOPMENT Humble Group AB Year-end Report January - December 2023 4 TWELVE MONTHS REVENUES Net sales Net sales for the period amounted to MSEK 7,050 (4,800), an increase of 47% compared to the corresponding period last year. The change is attributable to completed business acquisitions of 28%, organic growth for the wholly owned subsidiaries in both periods of 16% and currency impact was 3%. EXPENSES Other external expenses Other external expenses for the period amounted to MSEK -851 (-644), which corresponded to 12% (13) of net sales. Acquisition related costs for the period amounted to MSEK -6 (-65). Personnel expenses Personnel expenses for the period amounted to MSEK -790 (-625), which corresponded to 11% (13) of net sales. Personnel expenses were negatively impacted by consideration linked to employment (stay-on-bonus and lock-in penalties) of MSEK -45 (-72). Remaining increase is mainly explained by additional employees in the Group through the acquired subsidiaries. For more details, please refer to Note 7 Items affecting comparability. Depreciation and amortization Total depreciation and amortization for the period amounted to MSEK -341 (-247), which corresponded to a change of 38% compared with the corresponding period last year. Depreciation of right-of-use assets amounted to MSEK -64 (-48) for the full year. Amortization of intangible assets related from acquisitions, of which a vast majority related to customer relations, amounted to MSEK -146 (-128). Amortisation of intangible fixed assets for twelve months was negatively affected by an impairment of -35 MSEK due to Fancystage which is undergoing a strategic development for its operations to strengthen the profitability long term, and by -6 MSEK due to impairment of Goodwill for Bayn Production. Financial expenses Financial expenses for the period amounted to MSEK -393 (-265). The financial expense is affected by a onetime cost of MSEK -78 (0) related to the refinancing of the bonds. Interest expense related to unwinding of discounting effect of contingent considerations and other liabilities presented at fair value amounted to MSEK -69 (-61). Such interest expense has no cash effect in the result of the period. For more details, please refer to Note 6 Financial expenses. RESULTS EBITA Adjusted EBITA for the period amounted to MSEK 584 (466), which corresponded to a change of MSEK 118 for the period. EBITA for the period amounted to MSEK 547 (419), which corresponded to a change of MSEK 128 compared with the corresponding period last year. For more details, please refer to Note 7 Items affecting comparability. EBIT Adjusted EBIT amounted to MSEK 355 (304), which corresponded to a change of MSEK 51 for the period. EBIT for the period amounted to MSEK 318 (257), which corresponded to a change of MSEK 61 compared with the corresponding period last year. CASH FLOW Cash flow from operating activities Cash flow from operating activities amounted to MSEK 1,088 (255). Cash flow from operations was positively impacted by net working capital release of MSEK 558 (-116). The Group has during the period continued the work with several strategic initiatives to optimize the net working capital usage going forward. Tax deferments of total MSEK 260 was recognized as short term liabilities and had a positive impact on the cash flow for the period. . ===== SIDA 6 ===== | SEGMENT INFORMATION Humble Group AB Year-end Report January - December 2023 5 SEGMENT REPORT - FUTURE SNACKING SEGMENT OVERVIEW Our commitment to cutting-edge, sustainable snacks and assorted eats challenges conventional options, prioritizing health without compromising taste, quality, or experience. Future Snacking holds over 90% share in sugar-free and healthier candy offerings across the Nordics. Driven by a passion for innovation, our subsidiaries leverage high technological barriers, limiting competitors' market entry. Our leading brands enjoy strong recognition in the innovative space, setting us apart in the industry. Our fast-paced product development and R&D initiatives enable us to bring new offerings to market swiftly, staying ahead of consumer demands and industry trends. Additionally, we serve as a flexible, solutions-oriented contract manufacturer for Nordic market players, ensuring agility and responsiveness in meeting their needs. Humble Group's vision: to be the leading provider of high-quality sugar- reduced and confectionary snacks. SEGMENT UPDATE The most significant events and initiatives for the segment comprise, among others:  Successful integration of Tweek and MCN to FCB. Expected to result in reduced overhead, strengthened product offering and serve as a catalyst for growth.  Initiated set-up of Nordic manufacturing offering, Arena Confectionary. Starting to scale several of the manufacturers with additional production shift. We see further potential in utilizing synergies through coordination of capabilities and customer offering, strengthened operational efficiency and collaborative production and resource planning for maximised output.  Increased capacity initiatives introduced across several manufacturing entities to meet increasing demand.  Divestment of Bayn Production and winddown of Bayn Nordic as part of streamlining our Swedish manufacturing offering and strengthening operating results.  True Gum received B-Corp certification, manifesting our mission to increase accountability and transparency.  True Gum asset purchase of Ration bar brand completed, broadening the product range and bolster sales capabilities.  Actively reallocating capital for continued investments in our purpose-led brands and leveraging momentum to accelerate international expansion. SALES AND PROFITABILITY Net sales for the Future Snacking segment amounted to MSEK 233 (213) during the quarter, a total increase of 9% compared to the corresponding period last year. Adjusted EBITDA for the quarter amounted to MSEK 30 (47), with an Adjusted EBITDA margin of 13% (12). For further financial information of the Group, please refer to Note 4 Segment information and disclosure of revenue. Companies included in the segment can be found in Note 31 in the Annual report 2022 and in Note 9 Business combination in this interim report. FUTURE SNACKING Amount in M SEK 2023 2022 2023 2022 Net sales 233 213 936 733 Raw material and consumables -127 -121 -532 -417 Gross profit 106 92 404 316 Gross margin 46% 43% 43% 43% EBITDA 30 47 83 162 Items affecting comparability 0 -21 42 -57 Adjusted E BITDA 30 25 126 105 Adjusted EBITDA in relation to net sales 13% 12% 13% 14% EBIT A 20 45 47 138 Adjusted E BITA 20 24 90 81 Adjusted EBITA in relation to net sales 9% 11% 10% 11% EBIT 9 9 13 85 Adjusted E BIT 9 -12 55 28 Adjusted EBIT in relation to net sales 4% -6% 6% 4% Fourth quarter Twelve months ===== SIDA 7 ===== | SEGMENT INFORMATION Humble Group AB Year-end Report January - December 2023 6 SEGMENT REPORT - SUSTAINABLE CARE SEGMENT OVERVIEW Sustainable Care encompasses a wide range of brands, distributors, and manufacturers that cover multiple categories across organic household, personal care, beauty, and oral hygiene products. These entities unite to address the increasing demand for eco-friendly and sustainable products that promote a healthier planet and align with consumer preferences for environmentally conscious choices. The companies within the segment share a common goal of meeting the increasing demand for sustainable and eco-friendly products. By prioritizing sustainability, they actively contribute to creating a healthier and environmentally conscious planet. Their commitment to offering sustainable options aligns with the growing consumer preference for environmentally friendly choices. Through their collective efforts, the Sustainable Care segment is dedicated to make a positive impact on both personal well-being and the planet as a whole. Humble Group's vision: a modern personal- and home care retail partner. SEGMENT UPDATE The most significant events and initiatives for the segment comprise, among others:  Solent continued to deliver topline growth with solid profitability. Growing its presence and role as a dynamic retail partner for the Group’s brands.  The Humble Co. US continued to gain sales volume growth across main product categories in the US market. The entity will be used for additional brands (other segments as well) expansion in the US market.  Started integration and consolidation between Solent and Go Superfoods, enabling growth possibilities in both the UK and European market. Action in line with our strategy to consolidate, or integrate, smaller businesses into larger platforms and leverage on operational efficiencies and synergetic opportunities.  Organizational restructurings carried out in The Humble Co. for the purpose of reintroducing focus on growth in key markets and stricter cost control.  Naty transitioned to new manufacturing supplier for more balanced quality and improved cost structure.  Naty underwent organizational restructurings as part of strategy to reduce operational cost base and regain sales momentum.  Fancystage is undergoing a strategic development in the operations to strengthen the profitability long term, implying an impairment of intangible fixed assets and a one time effect of -35 MSEK during the fourth quarter. SALES AND PROFITABILITY Net sales for the Sustainable Care segment amounted to MSEK 612 (547) during the quarter, a total increase of 12% compared to the corresponding period last year. Adjusted EBITDA for the quarter amounted to MSEK 90 (102), with an Adjusted EBITDA margin of 15% (19). For further financial information of the Group, please refer to Note 4 Segment information and disclosure of revenue. Companies included in the segment can be found in Note 31 in the Annual report 2022 and in Note 9 Business combination in this interim report. SUSTAINABLE CARE Amount in M SEK 2023 2022 2023 2022 Net sales 612 547 2,197 1,845 Raw material and consumables -389 -364 -1,413 -1,171 Gross profit 223 183 784 674 Gross margin 36% 33% 36% 37% EBITDA 80 82 326 225 Items affecting comparability 11 20 -10 78 Adjusted E BITDA 90 102 317 303 Adjusted EBITDA in relation to net sales 15% 19% 14% 16% EBIT A 72 68 298 193 Adjusted E BITA 83 88 289 271 Adjusted EBITA in relation to net sales 14% 16% 13% 15% EBIT 11 64 158 124 Adjusted E BIT 22 83 148 202 Adjusted EBIT in relation to net sales 4% 15% 7% 11% Fourth quarter Twelve months ===== SIDA 8 ===== | SEGMENT INFORMATION Humble Group AB Year-end Report January - December 2023 7 SEGMENT REPORT - QUALITY NUTRITION SEGMENT OVERVIEW Quality Nutrition is dedicated to delivering premium nutritional products and supplements for athletes and the everyday consumer, focusing on enhancing well-being, performance, and health. With several highly recognized brands in innovative spaces and manufacturers, we set industry standards and hold a unique market positioning in the nutrition category. Our full-service offering across product categories and scalable production ensure adaptability, while serving as a flexible, solutions-oriented contract manufacturer for European market players. Through Arena Nutrition, we provide Nordic market players with a local sourcing alternative for a comprehensive range of nutritional ingredients, further enhancing our commitment to sustainability and quality. Humble Group's vision Nordics: Leading Business to Business supplier of sport nutrition products. Humble Group's vision Australia: A sports nutrition powerhouse. SEGMENT UPDATE The most significant events and initiatives for the segment comprise, among others:  Completed asset purchase of bar facility in Australia. Implementation well underway and will serve as a stand- alone contract manufacturer under the name Bars Production Australia.  Body Science sport- and energy drink launched. Poised to grow into one of the leading categories.  Brand expansion of Body Science to new markets initiated.  Vitargo export project initiated – a collaborative project with Body Science.  Significant progress in the implementation of drink production line at Habo, Sweden site. First trials are expected to be operational by end of H1 2024.  Increased capacity initiatives introduced across several manufacturing entities to meet increasing demand.  Several new product innovations initiated, enabled through cross-subsidiary collaborations. SALES AND PROFITABILITY Net sales for the Quality Nutrition segment amounted to MSEK 431 (339) during the quarter, an increase of 27% compared to the corresponding period last year. Adjusted EBITDA for the quarter amounted to MSEK 40 (34), with an Adjusted EBITDA margin of 9% (10). For further financial information of the Group, please refer to Note 4 Segment information and disclosure of revenue. Companies included in the segment can be found in Note 31 in the Annual report 2022 and in Note 9 Business combination in this interim report. QUALITY NUTRITION Amount in M SEK 2023 2022 2023 2022 Net sales 431 339 1,462 965 Raw material and consumables -278 -232 -1,030 -700 Gross profit 153 107 432 265 Gross margin 35% 32% 30% 27% EBITDA 35 11 166 104 Items affecting comparability 5 23 -11 4 Adjusted E BITDA 40 34 155 108 Adjusted EBITDA in relation to net sales 9% 10% 11% 11% EBIT A 30 2 144 83 Adjusted E BITA 35 25 132 87 Adjusted EBITA in relation to net sales 8% 7% 9% 9% EBIT 22 -11 115 57 Adjusted E BIT 27 12 103 61 Adjusted EBIT in relation to net sales 6% 4% 7% 6% Fourth quarter Twelve months ===== SIDA 9 ===== | SEGMENT INFORMATION Humble Group AB Year-end Report January - December 2023 8 SEGMENT REPORT - NORDIC DISTRIBUTION SEGMENT OVERVIEW Ever since its inception, Humble Group has pursued a comprehensive strategy that encompasses the entire value chain, including distribution. Within the Nordic Distribution segment, a network of wholesalers and distributors operates across the Nordic region. These companies possess extensive knowledge of local markets and consumer preferences. Leveraging the expertise of our Nordic Distribution subsidiaries, Humble are poised to deliver an extensive range of FMCG products that are tailored to the diverse tastes and preferences prevalent in the region. This collaborative strategy underscores our commitment to effectively addressing the unique demands of the local market and ensuring a comprehensive product portfolio that resonates with our valued customers. Humble Group's vision: Number 1 distribution partner for healthy and sustainable brands. SEGMENT UPDATE The most significant events and initiatives for the segment comprise, among others:  Nordfood integration to GSD successfully completed. • Privab Stockholm and Privab Ystad integration to Privab Nässjö completed. • Privab Trollhättan consolidation with Privab Nässjö completed – Maintaining stand-alone warehousing and logistics set-up. • Continued progress made in centralization project and improving IT infrastructure.  Continued progress made in freight and logistics procurement project – aims to gather volumes and reduce overall transportation cost. SALES AND PROFITABILITY Net sales for the Nordic Distribution segment amounted to MSEK 660 (506) during the quarter, an increase of 30% compared to the corresponding period last year. Adjusted EBITDA for the quarter amounted to MSEK 20 (13), with an Adjusted EBITDA margin of 3% (3). For further financial information of the Group, please refer to Note 4 Segment information and disclosure of revenue. Companies included in the segment can be found in Note 31 in the Annual report 2022 and in Note 9 Business combination in this interim report. NORDIC DISTRIBUTION Amount in M SEK 2023 2022 2023 2022 Net sales 660 506 2,455 1,257 Raw material and consumables -528 -411 -1,946 -980 Gross profit 132 95 509 277 Gross margin 20% 19% 21% 22% EBITDA 23 14 101 52 Items affecting comparability -4 -1 9 6 Adjusted E BITDA 20 13 110 58 Adjusted EBITDA in relation to net sales 3% 3% 4% 5% EBIT A 17 11 76 44 Adjusted E BITA 13 10 85 49 Adjusted EBITA in relation to net sales 2% 2% 3% 4% EBIT 11 7 55 29 Adjusted E BIT 7 6 64 35 Adjusted EBIT in relation to net sales 1% 1% 3% 3% Fourth quarter Twelve months ===== SIDA 10 ===== | OTHER INFORMATION Humble Group AB Year-end Report January - December 2023 9 OTHER INFORMATION ABOUT HUMBLE GROUP Humble Group is a leading FMCG Group with a focus on health and well-being. The Group comprises 47 operating entities at the day of this report. Humble Group has set financial targets that the Group shall reach SEK 16 billion in net sales proforma and SEK 1.9 billion in Adjusted EBITA proforma by the end of 2025. The company has an organic growth target at minimum 15% year over year and a NIBD / Adjusted EBITDA proforma below 2.5x. Read more about the Group and its composition on www.humblegroup.se STAFF AND NUMBER OF EMPLOYEES On Group level The average number of employees in the Group for the year was 1,129 (994). The proportion of women in the Group for the full year was 44% (49). Parent company The average number of employees in the Parent Company during the year was 18 (16), with 18% (25) being women. RISKS AND UNCERTAINTIES Humble Group works continuously to identify, evaluate, and manage risks and exposures that the Group subsidiaries face. The Group's financial position and earnings are affected by various risk factors that must be considered when assessing the company and its future earnings. A description of significant risks and uncertainties can be found in the Annual Report for 2022. At the time of this year-end report being published the war between Russia and Ukraine is still ongoing and recent events in the Middle East have also led to a renewed flare-up of the long- standing war in Israel and Gaza. Humble Group does not have any exposures towards these countries, and as such do not note any direct effects from the ongoing wars. Even though it is difficult to quantify the exact effects, the Group notices the indirect effects from the wars driven by increased inflation and rising interest rates with a following change in consumer consumption patterns. The Group monitors the market development closely to ensure that Humble positions its product mix in best possible way to meet any potential changes in market or consumer behaviour. Furthermore, the increased market price volatility regarding raw material prices as well as development of the freight crisis is monitored closely to enable transition of price increases to customers in all material aspects and to a protect stable operating margins. PARENT COMPANY Humble Group AB completed stage 1 of the communicated intention to divest properties within the group structured through a sale-lease-back transaction. Humble Group AB received 80% of the agreed property value in cash and the remaining 20% in issued preference shares in the buyer. Humble Group AB also entered into a binding agreement regarding sale of all shares in Bayn Production AB for a total purchase price of SEK 7,7 million. No other significant events occurred in Humble Group AB during the fourth quarter. RELATED PARTY TRANSACTION No transactions with related parties have occurred during 2023 that had a significant impact. The minor transactions that have occurred relates to lease agreements of previous owners’ properties. Lease agreements between the parties are based on an arms length’s perspective and on market terms and conditions. PROPOSED APPROPRIATION OF PROFITS The Board of Directors proposes that no dividend will be paid for the financial year 2023. FINANCIAL CALENDAR The interim report for the period January-March 2024 will be published on May 2nd, 2024. The annual report will be published on April 17 th,2024, and the Annual General Meeting is scheduled to May 22nd, 2024. For financial reports and calendar, see more detailed information on our website www.humblegroup.se CERTIFIED ADVISOR FNCA Sweden AB Email: info@fnca.se AUDITORS BDO Mälardalen Auditor in Charge: Carl-Johan Kjellman, Authorised Public Accountant Email: carl-johan.kjellman@bdo.se ===== SIDA 11 ===== | THE SHARE Humble Group AB Year-end Report January - December 2023 10 THE SHARE THE SHARE The company’s share with ticker HUMBLE has been listed on Nasdaq First North Growth Market since 12 November 2014. NUMBER OF SHARES At the end of the reporting period, the total number of shares was 443,544,543 (301,274,580), which entitles to one vote each. All shares are of the same share class. The number of outstanding warrants amounted to 7,420,000 (3,320,000). For the period October - December 2023, the average number of shares before dilution and average number of shares after dilution amounted to 443,544,543 and 450,964,543 respectively. TRADE IN THE SHARE Fourth quarter The total liquidity in the share during the quarter amounted to MSEK 338 (1,018). The number of transactions for the same period amounted to 35,793 (89,659). The average volume per transaction amounted to SEK 9,452 (11,357). The average volume per trading day amounted to MSEK 5 (16). LARGEST SHAREHOLDERS The ten largest shareholders per December 31, 2023, are listed below: DATA PER SHARE An overview of share development, turnover and result per share is presented below. Ow ner Shares Votes Neudi & C:o AB 46,135,778 10.40% Håkan Roos (RoosGruppen AB) 46,029,975 10.38% Noel Abdayem (NCPA Holding AB) 27,927,095 6.30% Alta Fox Capital 26,021,235 5.87% Capital Group 22,368,627 5.04% Creades AB 18,136,470 4.09% Nordnet Pensionsförsäkring 18,235,271 4.11% DNB Asset Management AS 13,639,502 3.08% Thomas Petrén (Seved Invest AB) 12,570,000 2.83% DNB Asset Management SA 9,850,486 2.22% Total top 10 240,914,439 54.32% Other shareholders 202,630,104 45.68% Total number of shares 443,544,543 100% 2023 2022 2023 2022 Low price (SEK) 7.83 7.65 5. 94 9.01 High price (SEK) 11.69 12.61 11.69 28.85 Closing price previous period (SEK) 9.10 9.23 9.77 28.00 Closing price current period (SEK) 11.38 9.77 11.38 9.77 Share price development during period (%) 25% 6% 16% -65% Trading volume in the share (MSEK) 338 1,018 1,748 4,223 Number of transactions in the share 35,793 89,659 181,662 347,133 Average volume per trading day (MSEK) 5 16 7 17 Average volume per transaction (SEK) 9,452 11,357 9,621 12,166 Number of shareholders* 20,670 24,080 20,670 24,080 Number of shares outstanding* 443,544,543 301,274,580 443,544,543 301,274,580 Average number of shares before dilution 443,544,543 301,274,580 377,360,692 284,151,901 Average number of shares after dilution 450,964,543 304,594,580 383,219,322 286,818,625 Net sales per share (SEK)** 4.37 5.33 18.68 16.89 Adjusted EBITDA per share (SEK)** 0.43 0.59 1.84 1.94 Adjusted EBITA per share (SEK)** 0.37 0.51 1.55 1.64 Adjusted EBIT per share (SEK)** 0.16 0.33 0.94 1.07 EBIT per share (SEK)** 0.15 0.21 0.84 0.90 Earnings per share (SEK) -0.02 -0.06 -0.28 -0.13 See page 26 for definition and calculation of key ratios. * End of period, **Before dilution Fourth quarter Twelve months ===== SIDA 12 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 11 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Amount in MSEK Note 2023 2022 2023 2022 Net sales 4 1 , 936 1 ,606 7,050 4,800 Capitalized work on own account 22 24 83 85 Other operating income 83 67 262 259 Raw materials and consumables -1 ,322 - 1,12 8 -4,921 -3,268 Other external expenses -250 - 19 0 -851 -644 Personnel expenses -222 - 19 6 - 790 -625 Other operating expenses -64 -41 - 174 - 10 3 EBITDA 7 18 4 14 3 659 504 Depreciation of tangible fixed assets - 11 - 10 -47 -37 Depreciation of right-of-use assets - 17 - 14 -64 -48 EBITA 7 15 6 119 547 4 19 Amortization of intangible fixed assets -54 -21 -83 -35 Amortization of assets related to acquisitions -37 -35 - 14 6 - 12 8 EBIT 7 66 62 3 18 257 Profit from shares in associated companies 2 -2 1 -4 Financial income 6 6 13 14 Financial expenses 5 -67 -83 -393 -265 PROFIT AND LOSS AFTER FINANCIAL ITEM S 6 - 17 -61 1 Income tax - 16 -1 -45 -37 PROFIT AND LOSS AFTER TAX* - 11 - 18 - 10 6 -36 Other comprehensive income Items that may be reclassified to profit or loss: Exchange differences in translation of foreign operations - 12 4 22 6 13 5 COMPREHENSIVE INCOME FOR PERIOD* - 13 5 4 - 10 0 99 Earnings per share before dilution -0,02 -0,06 -0,28 - 0 ,13 Earnings per share after dilution -0,02 -0,06 -0,28 - 0 ,13 *Profit and loss after tax and Total Comprehensive Income for the period are attributable in their entirety to the shareholdes of the parent company Fourth quarter Twelve months ===== SIDA 13 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 12 GROUP BALANCE SHEET - IN SUMMARY Amount in MSEK Note 2023 2022 ASSETS Non-currenct assets I ntangible assets 6,01 3 5,995 Tangible fixed assets 19 1 372 Financial assets 99 75 Right-of-use assets 299 15 1 Deferred tax assets 29 26 Total non-current assets 6,631 6,61 8 Current assets Inventory 983 982 Accounts receivables 561 683 Other short-term receivables 2 11 234 Cash and cash equivalents * 401 338 2,1 57 2,237 Assets classified as held for sale 6 12 9 0 Total current assets 2,287 2,237 TOTAL ASSETS 8,91 8 8,855 EQUITY AND LIABILITIES Equity Share capital 98 66 Unregistered share capital 0 0 Other equity contributed 5,032 4,1 31 Retained earnings -260 - 16 1 Equity attributable to Parent Company's shareholder 4,869 4,036 Long-term liabilities Interest-bearing liabilities 8 1 ,204 1,9 16 Contingent considerations 10 16 5 433 Long-term lease liabilities 258 10 0 Deferred tax liabilities 474 502 Other long-term liabilities 34 79 Total long-term liabilities 2,1 35 3,029 Short-term liabilities Interest-bearing liabilities * 8 247 579 Contingent considerations 10 336 347 Current lease liabilities 67 49 Accounts payable 652 550 Other short-term liabilities 568 265 1,8 70 1,79 0 Liabilities directly associated with assets classified as held for sale 6 43 0 Total short-term liabilities 1,9 13 1,79 0 TOTAL EQUITY AND LIABILITIES 8,91 8 8,855 December, 31 *In connection with the refinancing of group capital structure during the third quarter, the presentation of the Group Cash pool account changed which resulted in the cash and cash equivalents as well as short term interest liabilities have been restated per 2212. The change amount to -42MSEK in 2212. ===== SIDA 14 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 13 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY – FOURTH QUARTER Amount in M SEK Share capital U nregistered share capital Other equity contributed Exchange rate differences Retained earnings Total shareholders equity Opening balance September 1, 2022 66 0 4,243 155 -320 4,144 Net income for period -18 -18 Other comprehensive income 22 22 Total comprehensive income 22 -18 4 Transaction with owners in their capacity as owners: Share issue -113 -113 Transaction costs -1 -1 Warrants program 2 2 Total transaction with owners in their capacity as owners 0 -112 -112 Ending balance December 31, 2022 66 0 4,131 177 -338 4,036 Opening balance September 1, 2023 98 0 5,028 307 -432 5,000 Net income for period -11 -11 Other comprehensive income -124 -124 Total comprehensive income -124 -11 -135 Transaction with owners in their capacity as owners: Share issue 0 0 Transaction costs 0 Realization loss from share buyback 0 Warrants program 0 Adjustment to prior year 4 4 Total transaction with owners in their capacity as owners 0 4 0 0 4 Ending balance December 31, 2023 98 0 5,032 183 -443 4,869 E quity attributable to Parent Company's shareholder ===== SIDA 15 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 14 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY – TWELVE MONTHS Amount in M SEK Share capital U nregistered share capital Other equity contributed Exchange rate differences Retained earnings Total shareholders equity Opening balance January 1, 2022 54 1 3,315 43 -302 3,110 Net income for period -36 -36 Other comprehensive income 135 135 Total comprehensive income 135 -36 99 Transaction with owners in their capacity as owners: Share issue 12 -1 826 837 Transaction costs -12 -12 Warrants program 2 2 Total transaction with owners in their capacity as owners 12 -1 816 0 0 827 Ending balance December 31, 2022 66 0 4,131 177 -338 4,036 Opening balance January 1, 2023 66 0 4,131 177 -338 4,036 Net income for period -106 -106 Other comprehensive income 6 6 Total comprehensive income 6 -106 -100 Transaction with owners in their capacity as owners: Share issue 31 927 958 Transaction costs -28 -28 Realization loss from share buyback -1 -1 Warrants program -1 -1 Adjustment to prior year 4 4 Total transaction with owners in their capacity as owners 31 901 0 0 932 Ending balance December 31, 2023 98 0 5,032 183 -443 4,869 E quity attributable to Parent Company's shareholder ===== SIDA 16 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 15 GROUP CASH-FLOW STATEMENT The company received deferred tax support during the second quarter recognized as short-term liabilities. This had a positive one-time effect on the cash flow from operating activities of MSEK 260. Amount in M SEK 2023 2022 2023 2022 O PERATING ACTIVITIES Profit and loss after financial items 6 -17 -61 1 Adjustment for non-cash items Depreciation and Amortization 118 81 341 247 Other items 38 133 304 155 Paid tax -33 -14 -54 -33 Cash flow from operating activities before change in net working capital 129 183 529 371 CHANGE IN WORKING CAPITAL Change in inventories (increase - / decrease + ) 44 -6 27 - 101 Change in short term receivables (increase - / decrease + ) 22 46 190 74 Change in short term liabilities (increase - / decrease + ) 91 25 341 -88 Sum of change in working capital 156 64 558 -116 Cash flow from operating activities 285 246 1,088 255 INVESTING ACTIVITIES Acquisition of capitalized development costs -21 -24 -83 -84 Acquisition of intangible assets -22 0 -29 -6 Acquisition of tangible assets -10 -48 -49 -57 Acquisition of financial assets 0 0 0 0 Acquisition of subsidiaries, sold businesses 107 0 107 0 Acquisition of subsidiaries, acquired business + paid earn-outs -17 -2 -369 -901 Cash flow from investing activities 37 -74 -423 -1,048 FINANCING ACTIVITIES Share issue funds 0 0 875 530 Costs related to share and bond issues -3 -2 -111 -12 Paid premium for share incentive program 0 2 0 2 Bond financing 0 0 -1,800 0 Proceeds from bond 0 0 0 300 Paid interest due to financing activities -29 -36 -216 -154 New loans 0 279 1,546 769 Repayment of loans -256 -354 -823 -670 Amortization of lease liability -18 -16 -72 -52 Cash flow from financing activities -307 -128 -601 712 Decrease/Increase in cash and cash equivalents 15 44 64 -82 Cash and cash equivalents at beginning of period 397 295 338 420 Exchange rate differences -11 -1 -1 -1 Cash and cash equivalents at end of period 401 338 401 338 Deployable cashflow* 292 122 486 -99 *See page 26 for definition and calculation Fourth quarter Twelve months ===== SIDA 17 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 16 INCOME STATEMENT - PARENT COMPANY Amount in M SEK 2023 2022 2023 2022 Net sales 25 19 44 21 Other operating income -2 -3 1 1 Total revenue 23 16 46 22 Capitalized w ork on ow n account 0 2 0 9 Other external expenses -9 -8 -29 -20 Personnel expenses -13 -18 -43 -48 Other operating expenses 75 0 76 -1 EBITDA 76 -8 49 -38 Depreciation and amortization of fixed tangible and intangible assets -11 0 -11 0 EBIT 65 -8 38 -38 Profit from shares in subsidiaries and associated companies 0 0 0 0 Received dividends from subsidiaries 27 15 40 52 Interest income 10 12 34 13 Interest expenses -57 -82 -355 -230 PROFIT AND LOSS AFTER FINANCIAL ITEM S 44 -63 -243 -204 Year-end appropriations 96 100 96 100 PROFIT AND LOSS BEFORE TAX 140 37 -147 -104 Current taxes -5 -16 -5 -16 PROFIT AND LOSS AFTER TAX 135 21 -152 -120 In the parent company, there are no items that are reported as other comprehensive income, which is why total comprehensive income corresponds to the year's result. Fourth quarter Twelve months ===== SIDA 18 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 17 PARENT COMPANY BALANCE SHEET – IN SUMMARY Amount in M SEK Note 2023 2022 ASSETS Non-current assets Intangible fixed assets 2 1 T angible fixed assets 3 1 Financial fixed assets 6,967 6,920 Total non-current assets 6,972 6,922 Current assets Inventory 0 0 Accounts receivables 40 0 Receivables w ith group companies 230 287 Other short-term receivables 24 13 Cash and cash equivalents 4 1 Total current assets 298 301 TOTAL ASSE TS 7,269 7,222 EQUITY AND LIABILITIES Equity Restricted equity 98 66 Unrestricted equity 4,637 3,880 Total shareholders equity 4,735 3,946 Provisions 507 786 Long term liabilities Interest-bearing liabilities 1,189 1,826 Liabilities to group companies 15 0 Other long-term liabilities 11 33 Total long-term liabilities 1,215 1,859 Short-term liabilities Interest-bearing liabilities 253 571 Accounts payable 12 7 Liabilities to group companies 506 24 Other liabilities 41 29 Total short-term liabilities 812 631 TOTAL E QUITY AND LIABILITIE S 7,269 7,222 D ecember, 31 ===== SIDA 19 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 18 NOTES AND PERFORMANCE MEASUREMENTS NOTE 1 – ACCOUNTING PRINCIPLES The consolidated financial statements have been prepared in accordance with the Swedish Annual Accounts Act, RFR 1 Supplementary Accounting Rules for Groups and International Financial Reporting Standards (IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) as adopted by the EU. The interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. The financial statements have been prepared according to cost method except from certain financial assets and liabilities measured at fair value through profit and loss. The accounting policies adopted are consistent with those of the Annual report for the year ended December 31, 2022. New or amended IFRS standards, effective from January 1, 2023, have no impact on the result and financial position of the Group. NOTE 2 – SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS The Group makes estimates and assumptions about the future. The estimates for accounting purposes that result from these will, by definition, rarely correspond to the actual result. The estimates and assumptions that entail a significant risk of significant adjustments in reported values for assets and liabilities in this interim report correspond to those describe in Note 3 in the Annual report 2022. The management has made assessments and estimates continuously throughout 2023, where the main estimates relate to contingent considerations. See Note 10 for more information. On December 1st the Group announced its intention regarding sale of real estates as a sale and leaseback transaction. The first part of the sale took place on December 15th, thus a right-of-use asset is measured at the proportion of the previous carrying amount of the asset that relates to the right of use retained by the Group. The associated assets for the second part of the sale are presented as assets held for sale in the financial statement. On December 19th the Group announced its intention to divest Bayn Production AB. The associated assets and liabilities of Bayn Production are presented as assets held for sale in the financial statement. Quantitative information is presented in Note 7. NOTE 3 – SUBSEQUENT EVENTS On January 2nd, Humble Group divested Bayn Production AB. The company was divested as part of Humble Groups long-term strategy to streamline the operations. The total purchase price for the shares in Bayn Production amount to MSEK 7.7. See Note 7 for more information ===== SIDA 20 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 19 NOTE 4 – SEGMENT INFORMATION AND DISCLOSURE OF REVENUE The Group's chief operating decision maker is the chief executive officer (CEO), who primarily uses a measure of adjusted earnings before interest, tax, depreciation, and amortization (Adjusted EBITDA) to assess the performance of the operating segments. The CEO does not follow up the segments' assets or liabilities for allocation of resources or assessment of results. For further information regarding the segments, please refer to page 5-8. The Group financials consists of below combined segments: Fourth quarter 2023, amount in M SEK Future Snacking Sustainable Care Quality Nutrition Nordic Distribution Other* Total Net sales** 233 612 431 660 0 1,936 Raw material and consumables -127 -389 -278 -528 0 -1,322 Gross profit 106 223 153 132 614 Gross margin, % 46% 36% 35% 20% 32% EBITDA 30 80 35 23 15 184 Items affecting comparability (note 5) 0 11 5 -4 -5 7 Adjusted E BITDA*** 30 90 40 20 10 190 Adjusted EBITDA in relation to net sales 13% 15% 9% 3% 10% EBIT A 20 72 30 17 16 156 Adjusted E BITA 20 83 35 13 11 162 Adjusted EBITA in relation to net sales 9% 14% 8% 2% 8.4% EBIT 9 11 22 11 13 66 Adjusted E BIT 9 22 27 7 7 72 Adjusted EBIT in relation to net sales 4% 4% 6% 1% 4% *Other refers to Parent company and minor administrative entities, **Revenue from sales to external customers, ***See Note 5 for reconciliation to Profit before tax Fourth quarter 2022, amount in M SEK Future Snacking Sustainable Care Quality Nutrition Nordic Distribution Other* Total Net sales** 213 547 339 506 1,606 Raw material and consumables -121 -364 -232 -411 0 -1,128 Gross profit 92 183 107 95 478 Gross margin, % 43% 33% 32% 19% 30% EBITDA 47 82 11 14 -11 143 Items affecting comparability (note 5) -21 20 23 -1 16 36 Adjusted E BITDA*** 25 102 34 13 4 179 Adjusted EBITDA in relation to net sales 12% 19% 10% 3% 11% EBIT A 45 68 2 11 -7 119 Adjusted E BITA 24 88 25 10 9 155 Adjusted EBITA in relation to net sales 11% 16% 7% 2% 10% EBIT 9 64 -11 7 -6 62 Adjusted E BIT -12 83 12 6 10 98 Adjusted EBIT in relation to net sales -6% 15% 4% 1% 6% *Other refers to Parent company and minor administrative entities, **Revenue from sales to external customers, ***See Note 5 for reconciliation to Profit before tax ===== SIDA 21 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 20 Twelve months 2023, amount in M SEK Future Snacking Sustainable Care Quality Nutrition Nordic Distribution Other* Total Net sales** 936 2,197 1,462 2,455 0 7,050 Raw material and consumables -532 -1,413 -1,030 -1,946 0 -4,920 Gross profit 404 784 432 509 2,129 Gross margin, % 43% 36% 30% 21% 30% EBITDA 83 326 166 101 -18 659 Items affecting comparability (note 5) 42 -10 -11 9 6 37 Adjusted E BITDA*** 126 317 155 110 -12 696 Adjusted EBITDA in relation to net sales 13% 14% 11% 4% 10% EBIT A 47 298 144 76 -19 547 Adjusted E BITA 90 289 132 85 -12 584 Adjusted EBITA in relation to net sales 10% 13% 9% 3% 8% EBIT 13 158 115 55 -23 318 Adjusted E BIT 55 148 103 64 -16 355 Adjusted EBIT in relation to net sales 6% 7% 7% 3% 5% *Other refers to Parent company and minor administrative entities, **Revenue from sales to external customers, ***See Note 5 for reconciliation to Profit before tax Twelve months 2022, amount in M SEK Future Snacking Sustainable Care Quality Nutrition Nordic Distribution Other* Total Net sales** 733 1,845 965 1,257 4,800 Raw material and consumables -417 -1,171 -700 -980 -3,268 Gross profit 316 674 265 277 1,532 Gross margin, % 43% 37% 27% 22% 32% EBITDA 162 225 104 52 -39 504 Items affecting comparability (note 5) -57 78 4 6 16 47 Adjusted E BITDA*** 105 303 108 58 -23 551 Adjusted EBITDA in relation to net sales 14% 16% 11% 5% 11% EBIT A 138 193 83 44 -39 419 Adjusted E BITA 81 271 87 49 -22 466 Adjusted EBITA in relation to net sales 11% 15% 9% 4% 10% EBIT 85 124 57 29 -38 257 Adjusted E BIT 28 202 61 35 -22 304 Adjusted EBIT in relation to net sales 4% 11% 6% 3% 6% *Other refers to Parent company and minor administrative entities, **Revenue from sales to external customers, ***See Note 5 for reconciliation to Profit before tax ===== SIDA 22 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 21 NOTE 5 – FINANCIAL EXPENSES During the fourth quarter, Humble Group fullfilled the refinancing of exisitng bonds and credit facility by taking up new bank facilities. The refinancing is expected to decrease the interest cost, which will have a positive impact on the result and cash flow. NOTE 6 – ASSETS HELD FOR SALE On December 1st the Group announced its intention regarding sale of real estates as a sale and leaseback transaction. The first part of the sale took place on December 15th, thus a right-of-use asset is measured at the proportion of the previous carrying amount of the asset that relates to the right of use retained by the Group. The right-of-use assets amount to MSEK 87 and the lease liability MSEK 107. The gain of MSEK 9 relates to the rights transferred to the buyer. The associated assets for the second part of the sale amount to MSEK 112 are presented as assets held for sale in the financial statement. Property related loans are presented as liabilities directly associated with assets classified as held for sale. On December 19th the Group announced its intention to divest Bayn Production AB. The asset and liabilities are measured at lowest of nominal value and fair value, and an impairment loss of MSEK 6 has been recognized in the fourth quarter. The associated assets of MSEK 17 and liabilities of MSEK 9 are presented as assets held for sale in the financial statement. N et sales per country Amount in M SEK 2023 2022 2023 2022 Australia 164 73 423 141 Chi na 65 47 193 150 Denmark 21 22 80 62 Finland 29 28 108 77 Germany 61 75 272 234 Norw ay 66 58 264 202 Portugal 44 68 167 127 Sw eden 927 765 3496 2410 United Kingdom 309 264 1166 846 USA 30 29 126 87 Other countries* 220 176 755 465 Total net sales 1,936 1,606 7,050 4,800 *None of the other countries independently contribute more than one percent of total net sales. Fourth quarter Twelve months Amount in M SEK 2023 2022 2023 2022 Interest expense related to financing -38 -58 -213 - 174 Unw inding of discounting effect -13 -24 -69 - 61 Interest expense on lease liabilities -3 -2 -10 -6 Exchange rate losses and revaluation effects -9 -3 -11 - 17 Costs related to refinancing of bond 0 0 -78 0 Other interest expenses -5 4 -13 -7 Financial expenses -67 -83 -393 -265 Fourth quarter Twelve months ===== SIDA 23 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 22 NOTE 7 – ITEMS AFFECTING COMPARABILITY Humble Group recognizes items affecting comparability to EBITDA to visualise comparable figures that are adjusted for the items that occur in historical numbers for various reasons. Explanation of what the items affecting comparability mainly refer to are presented in Note 10 in the Annual report 2022. Humble has not adjusted for any items related to freight costs during 2023. The main adjustment item during the quarter was related to employee-related compensation and lock-in penalties of MSEK -10 (-13). These expenses had no cash flow impact. Amount in MSEK 2023 2022 2023 2022 Adjusted EBITDA 19 0 179 696 551 Acqusition related cost and income* -2 - 11 -8 -39 Revaluation of contingent considerations accounting** 9 3 51 111 Lock-in penalty from acquisition SPA** - 10 - 13 -45 - 72 Donations 0 1 -1 -3 Restructuring -8 -35 -23 -42 Other 3 17 - 11 -3 EBITDA 18 4 14 3 659 504 Depreciation -28 -24 - 112 -85 EBITA 15 6 119 547 4 19 Amortization -90 -56 -229 - 16 2 EBIT 66 62 3 18 257 Finance net -60 -80 - 379 -255 EBT 6 - 17 -61 1 *2022 incl surplus value in inventory. **These items have no cash flow impact Fourth quarter Twelve months Amount in M SEK 2023 2022 2023 2022 EBITDA 184 143 659 504 Items affecting comparability 7 36 37 47 Ad justed E BITDA 190 179 696 551 EBIT A 156 119 547 419 Items affecting comparability 7 36 37 47 Ad justed E BITA 162 155 584 466 EBIT 66 62 318 257 Items affecting comparability 7 36 37 47 Ad justed E BIT 72 98 355 304 Fourth quarter Twelve months ===== SIDA 24 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 23 N OTE 8 – NET INTEREST-BEARING DEBT Humble Group's net interest-bearing debt as of December 31, 2023, is presented in table below. During 2023, Humble Group has carried out a directed share issue and raised MSEK 849 in cash net of transactional costs, of which MSEK 450 was used to amortize its revolving credit facility in June 2023. H umble Group received tax deferments of MSEK 260 during the second quarter 2023. In accordance with IFRS Accounting principles, this has been recognized as other short-term liability. The tax deferment got extended one year from September 2023 with the possibility for extension for up to one additional year. T able below illustrates the leverage multiple adjusted for inclusion of earnout max cash payment, sale and leaseback, and tax deferral. Twelve month Adjusted EBITDA Proforma amounted to MSEK 720. Net Interest-bearing debt in relation to last twelve months Adjusted EBITDA proforma amounts to 1,9x at the end of this reporting period. Amount in MSEK 2023 2022 Interest-bearing liabilities Bond financing debt 0 1 ,826 Liability to credit institutions excluding liabilites related to assets held for sale (property financing) 1 ,450 668 Lease liabilities 325 15 0 Total interest-bearing liabilities 1,775 2,644 Cash and cash equivalents -401 -338 Net Interest Bearing Debt (NIBD) 1,3 74 2,306 December, 31 Amount in MSEK December, 31 LTM Adj. EBITDA proforma Leverage Multiple Net Interest Bearing Debt (NIBD) 1,3 74 720 1,9 x Lease Liabilities and EBITDA impact -325 -81 Proforma properties sale and leaseback (SLB) ongoing process - 13 3 - 11 Tax deferral 260 Net Interest Bearing Debt (NIBD-Leasing+ Tax Deferrals) 1,176 628 1,9 x Earnout nominal value 542 Net Interest Bearing Debt (NIBD+ EO-Leasing+ Tax Deferrals) 1,718 628 2,7x ===== SIDA 25 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 24 NOTE 9 – BUSINESS COMBINATIONS BUSINESS COMBINATIONS 2023 Acquisitions during fourth quarter No new acquisition has been made during the fourth quarter of 2023. During first quarter of 2023, the Parent Company acquired 100% of four subsidiaries. The acquisitions are presented on an aggregated level, as the relative amounts of the individual acquisitions are not deemed to be material. The subsidiaries have operations within distribution and manufacturing. Identified excess values are linked to Goodwill MSEK 61, Customer relationship and listing of MSEK 11, Trademark and brands of MSEK 21, Buildings and lands of MSEK 9 and Deferred tax liability of MSEK 12. Significant estimate: contingent consideration Two of the total acquisitions made during 2023 have an agreement of contingent considerations of total MSEK 32. These considerations are due to payment within 0-3 years. The potential undiscounted amount payable under the agreements amount to MSEK 39 for cumulative EBITDA. The fair value of the contingent consideration was MSEK 32 at the initial recognition and is estimated by calculating the present value of the future expected cash flows at the end of the accounting period. The estimates are based on a weighted average cost of capital as discount rate of 11,02%. Employment linked consideration No employment linked consideration is related to the acquisitions carried out during 2023. Revenue and profit contribution The acquisition of the subsidiaries contributed with net sales of MSEK 60 to the Group for the period from the acquisition date to end of March 2023. The subsidiaries also contributed with an EBITDA of MSEK 2 during the same period. If the subsidiaries would have been consolidated from January 1, 2023, the Group's income statement would present additional net sales of MSEK 135 and EBITDA of MSEK 8. Acquisition-related costs Acquisition-related costs of 6 MSEK are included in the statement of profit and loss and in operating cash flows in the statement of cash flows. Summary of distribution of purchase price, PPA – IFRS Subsidiary Acquisition date Shares and votes Segment V ertical Country Napame Holding AB 2023-03-01 1 00% Future snacking Manufacturing Sweden Aktiebolaget Cool & Candy AB 2023-03-1 5 1 00%Nordic Distribution Distribution Sweden Skövde Snabbgross AB 2023-03-1 5 1 00%Nordic Distribution Distribution Sweden Privab Grossisterna AB 2023-03-1 5 1 00%Nordic Distribution Distribution Sweden Total acquisition, amount in M SEK D ecember, 31 Goodw ill 61 C ustomer relationships and listings 11 Trademarks and brands 21 Other fixed assets 51 Total fixed assets 144 Inventory 39 Accounts receivable 27 Liquid funds 20 Other current receivables 8 Total current assets 93 Total asset 237 Deferred taxes 12 Other provisions 0 Total provisions 12 Total long term liabilities 19 Accounts payable 41 Other current liabilities 0 Total current liabilities 41 Total liabilities 72 N et assets 165 Cash 75 Share issue 40 Contingent consideration 32 Deferred payment 0 Total purchase price 146 ===== SIDA 26 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 25 NOTE 10 – FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE The levels in the fair value hierarchy are defined as follows: Financial instrument level 1 Quoted market prices (unadjusted) in active markets for identical assets or liabilities. Financial instrument level 2 Observable data for the asset or liability other than quoted prices included in level 1, either directly (i.e. as price quotations) or indirectly (i.e. derived from price quotations). Financial instrument level 3 When one or more of the significant inputs is not based on observable market data. The Group's financial assets measured at fair value through profit and loss consists of Other long-term securities, which are classified as level 1 in the fair value hierarchy. The Group's financial liabilities measured at fair value through profit and loss consists of Contingent consideration, which are classified as level 3 in the fair value hierarchy. There have been no transfers between fair value hierarchy levels during the reporting period. FAIR VALUE DISCLOSURE OF LONG TERM LOANS During the third quarter, Humble Group refinanced its bond obligations of 1 800 MSEK in total, and replaced this with two Term loans of total 1 350 MSEK and one revolving credit facility of total 300 MSEK. The new term loans are measured at amortized cost that corresponds in all essential to its fair value in the balance sheet. CONTINGENT CONSIDERATIONS The total contingent consideration to be paid are generally conditioned by significant financial performance improvements, which usually is measured to certain pre-determined EBITDA- levels by the subsidiary to be reached. The nature of the payments is generally a subject for Humble Group to decide, with a majority to be paid in cash but can also be paid with newly issued shares. This has a potential positive impact of the Groups cash flow and long-term net debt. The mechanics behind the additional purchase prices differ between the various acquisitions and the Group's commitments also extend over a longer time horizon. The provision in the consolidated balance sheet is presented at a higher level and constitutes a valuation of management's best assessment of the expected future cash flow. This assessment is made on a subsidiary-based level and is revalued regularly. The contingent considerations are recognized at fair value and have been discounted with 11% discount rate. The duration to maturity is presented below. INPUT USED IN RECURRING LEVEL 3 FAIR VALUE MEASUREMENTS AND VALUATION TECHNIQUES The contingent considerations in the Group have been calculated based on the nominal value of the best estimate of the expected outcome on the date of the acquisition. The estimate is based on management's assessment of the probable amount to be paid given the terms of the share transfer agreement. The fair value of the contingent considerations has been calculated based on an interest rate corresponding to the remaining term until payment at each reporting date. During 2023, MSEK -60 (-57) in interest income was recognized as finance expenses regarding expenses related to contingent considerations. Estimated payments per year Nominal value Fair value 2024 349 336 2025 175 151 2026 17 13 Total contingent considerations 542 501 Contingent consideration, amount in M SEK 2023 2022 Opening balance, January 1 780 737 New acquisitions 32 247 Payments -320 -144 Revaluation -50 -111 Interest expenses related to unw inding of discounting effect 60 57 Translation differences 0 -5 Closing balance, December 31 501 780 D ecember, 31 ===== SIDA 27 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 26 DEFINITIONS AND CALCULATIONS ON KEY RATIO This report includes definitions and key figures that are not clearly defined in ÅRL or International Financial Reporting Standards (IFRS) but are what the company management considers to be relevant to users of the financial report as a supplement for the measures of the business's development. These financial measurements are not always comparable with the measures used by other companies since not all companies calculate such financial measures in the same way. Accordingly, these financial measures are not to be regarded as a replacement for measures defined according to IFRS. The calculations relate to period January-December 2023 Gross Profit Net sales less raw materials and consumables. Gross Profit is calculated as 7,050 –4,921 = 2,129 MSEK. Gross Margin Gross Profit in relation to net sales. Gross Margin is calculated as 2,129 / 7,050 = 30%. EBITDA Earnings before interest, tax, depreciation, amortization, write- down and depreciation and amortization on acquisition-related surplus values. Adjusted EBITDA Earnings before interest, tax, depreciation, amortization, write- down, and amortization on acquisition-related surplus values, adjusted for items affecting comparability. Adjusted EBITDA margin is Adjusted EBITDA in relation to net sales. Adjusted EBITDA per share is Adjusted EBITDA divided by average number of shares before dilution. Adjusted EBITDA is calculated as 659 + 37 = 696 MSEK. Adjusted EBITDA margin is calculated as 696 / 7,050 = 10%. Adjusted EBITDA per share is calculated as MSEK 696 / 377,360,692 = 1.84 SEK. EBITA Earnings before interest, tax, amortization, write-down, and amortization on acquisition-related surplus values. EBITA-margin is EBITA in relation to net sales. Adjusted EBITA Earnings before interest, tax, amortization, write-down, and amortization on acquisition-related surplus values, adjusted for items affecting comparability. Adjusted EBITA margin is Adjusted EBITA in relation to net sales. Adjusted EBITA per share is Adjusted EBITA divided by average number of shares before dilution. Adjusted EBITA is calculated as 547 + 37 = 584 MSEK. Adjusted EBITA margin is calculated as 584 / 7,050 = 8% Adjusted EBITA per share is calculated as MSEK 584 / 377,360,692 = 1.55 SEK. Adjusted EBIT Earnings before interest and tax, adjusted for items affecting comparability. Adjusted EBIT margin is Adjusted EBIT in relation to net sales. Adjusted EBIT per share is Adjusted EBIT divided by average number of shares before dilution. Adjusted EBIT is calculated as 318 + 37 = 355 MSEK. Adjusted EBIT margin is calculated as 355 / 7,050 = 5% Adjusted EBIT per share is calculated as MSEK 355 / 377,360,692 = 0.94 SEK. Net interest-bearing debt Total interest-bearing liabilities and lease liabilities, less cash and cash equivalents. Net interest-bearing debt is calculated as 1,450 + 325- 401 = 1,374 MSEK. Organic growth in net sales Change in net sales adjusted for exchange rate effect and net sales from acquired subsidiaries during the period. Organic growth in net sales is calculated as 771 / 4,800 = 16%. Deployable cash flow The amount of cash remaining from operating activities after deduction of cash flow from investing activities, plus acquisition of subsidiaries (net cash effect), less paid interest, less amortisation of lease liability, less tax deferrals. Deployable cash flow is calculated as 1,088 – 423 + 369 - 216 - 72 – 260 = 486. Last twelve months Adjusted EBITDA proforma Adjusted EBITDA proforma present the accumulated EBITDA before intra group eliminations in all entities in the group where an agreement of acquisition or divestment have been entered at the date of this report, adjusted for items affecting comparability. ===== SIDA 28 ===== | FINANCIAL INFORMATION Humble Group AB Year-end Report January - December 2023 27 Glossary FMCG FMCG is an industry term and is short for Fast Moving Consumer Good. Contingent consideration Deferred purchase price payments that are contingent upon future performance of an acquired subsidiary. The consideration can be paid in both cash and shares and are presented to fair value based on management’s best estimate of the occurrence of future payments. LTM Short for Last twelve months Proforma Present the income statement before intra group eliminations in all entities in the group where an agreement of acquisition or divestment have been entered. The purpose is to visualise how the Group's financial position and results would have looked like at the date of this report if the companies acquired during the year, or where acquisition agreements have been communicated had been consolidated with the existing part of the Group for twelve months. BOARD OF DIRECTORS’ APPROVAL The Board of Directors and the CEO assure that the interim report gives a true and fair view of the Group's and the Parent Company's operations, position and results and describes significant risks and uncertainties that the Parent Company and the companies included in the Group face. Stockholm February 19, 2024 Dajana Mirborn Ola Cronholm Chairman of the Board Henrik Patek Pål Bruu Sara Berger Simon Petrén Chief Executive Officer This information is such that Humble Group AB is obliged to publish in accordance with the EU regulation on market abuse. The information was submitted for publication on February 19, 2024, at the time specified by Humble Group's news distributor Cision at the time of publication of this press release. ===== SIDA 29 ===== | CONTACT US Humble Group AB Year-end Report January - December 2023 Company Registration Number 556794-4797 Headquarters Ingmar Bergmans gata 2 114 34 Stockholm info@humblegroup.se www.humblegroup.se +4608 613 28 88 Johan Lennartsson Chief Financial Officer johan.lennartsson@humblegroup.se Simon Petrén Chief Executive Officer simon.petren@humblegroup.se Noel Abdayem Vice President & COO Brands noel.abdayem@humblegroup.se Marcus Stenkil Head of Merger & Acquisitions marcus.stenkil@humblegroup.se Kristoffer Zinn Head of analytics kristoffer.zinn@humblegroup.se