Financial Results of Year 2020

FINANCIAL RESULTS OF YEAR 2020

ATHEX:  PLAT

Reuters:    THRr.AT

Bloomberg:  PLATGA

The purpose of the current release is to present the Group’s financial results for the fiscal year 2020.

Despite the fact that the wide and rapid spread of the coronavirus COVID-19 from the beginning of 2020 until today has caused significant disruptions in global supply and demand, the business and financial activity as well as operation of the Group was not adversely affected during the year. On the contrary, the Group implemented an effective action plan, ensuring the necessary liquidity, expanding its customer and product portfolio and implementing targeted investments, and as a result the Group managed to improve its financial position at all levels.

Regarding the operation of production, all production units within the Group continued to operate smoothly for the entire year 2020, without facing any operational issues from the spread of the pandemic, regarding the health and safety of the Group's employees, as a result of the particularly strict protection measures taken by the Group since the beginning of the pandemic.

From a financial point of view, the Group managed not only to deter any decrease in its revenues, but instead achieved to expand sales and profitability, as the reduced demand in some areas of activity was more than offset by the significant increase in sales in other areas. More specifically, it was observed:

• Increased demand for products related to personal protection and health and in particular for technical fabrics, used in personal protection applications.

• Generation of sales in products and activities related to personal protection, including the installation and operation of surgical mask production lines in Greece, Scotland and Ireland.

• Increased demand for products aimed at the food packaging sector.

• Reduced demand for packaging products related to tourism and catering, as a result of the limited activity in this sector, especially in Greece.

• Fluctuation of raw materials’ prices worldwide at relatively lower levels.

• Maintaining and further strengthening the Group's customer base.

More specifically, the following table presents the main financial figures of the Group for 2020 in relation to the corresponding year of 2019. It is also noted that the discontinued operations concern the termination of production activities of the US subsidiary Thrace Linq Inc.

The Adjusted EBITDA does not include expenses with total value of € 4,065 thousand, of which € 3,133 thousand relate to the operational reorganization of Don & Low LTD. This subsidiary reduced its presence in woven technical fabrics, while increasing its production capacity in non-woven technical fabrics. Also the figure does not include costs of € 162 thousand of Thrace Nonwovens & Geosynthetics Single Person SA from the transfer of Thrace Linq Inc assets to its facilities, as well as extraordinary allowance to personnel of € 780 thousand.

In terms of Earnings before Taxes, the Group within the year 2020 managed to respond to the significantly increased demand for products comprising the existing portfolio which are used in personal protection and health applications, taking advantage of the technological capabilities of its modern production lines, the available sales networks and by implementing targeted investments (as already mentioned above). Total Earnings before Tax on the Group level for the year 2020 amounted to € 52.1 million, out of which, according to Management estimates, € 22.7 million was a result of the above conditions and especially due to the change of the product mix compared to the previous year.

Finally, during the period under consideration, the reduction of Net Debt by € 45,318 thousand was significant (on 31.12.2020 it amounted to € 38,210 thousand compared to € 83,528 thousand on 31.12.2019, i.e. a percentage reduction of 54.3%), with the Net Debt / Equity ratio settling at 0.22x compared to 0.57x on 31.12.2019 and with the Net Debt / EBITDA ratio settling at 0.55x on 31.12.2020 versus 2.91x on 31.12.2019.

The total Equity on 31.12.2020 amounted to € 174,583 thousand compared to € 146,349 thousand on 31.12.2019.

Prospects and Outlook of the Group for the Financial Year 2021

The duration of the pandemic crisis for a period more than a year has created conditions of uncertainty in the wider macroeconomic and business environment. However the commencement as well as the accelerated evolution of vaccinations allows for optimism when it comes to the effective and definitive response to the pandemic in the future. However at this stage it is not possible to predict the precise time when the above objective will be achieved. All the above define various risk factors, which do not allow reliable estimates both for the course of the economies in the short-term but especially after the termination of the various state aid measures currently in place for those who have been financially affected by the pandemic. The Group constantly evaluates the potential risks and their impact, without being able to clearly assess the total impact that these will have on the Group's financial performance in the future.

Regarding the financial performance of the Group for the current year and according to the developments observed so far, it should be noted that the start of the year appears to be a continuation of the previous financial year, both in terms of product mix and profitability. At the same time, the emergence of shortages of basic raw materials from the beginning of the year until today, creates pressure on world markets and a rapid increase in prices of all basic raw materials.

The main concern of the Group was and remains the smooth continuation of its production activity and the business continuity in all areas of operation, in order to ensure the response to the requirements and needs of customers; a fact that to date has been achieved with absolute success. The Management of all subsidiaries within the Group make every possible effort in order to offset any negative effects caused from the conditions that have prevailed in the global marketplace, having to date achieved -satisfactory results.

As a result of the above, the evolution of the Group’s performance in the first quarter of 2021 remains satisfactory, both in terms of sales and profitability, despite the unfavorable macroeconomic conditions in the market. For the entire year of 2021, the uncertainty that exists in the global market place at this stage makes any prediction uncertain.

The maintenance of the sound capital structure of the Group and of the required liquidity levels, the further strengthening of its financial position in combination with the continuous monitoring of individual operating drivers, and the timely implementation of actions, wherever required, are the necessary conditions for limiting the negative impact from the conditions of the global market place and ensuring the Group’s smooth business continuity. The Management of the Group continues to take all the necessary decisions and actions and is working systematically towards this direction.

For further clarifications or information regarding the present release you may refer to Ms Ioanna Karathanasi, Head of Investor Relations, tel.: + 30 210-9875081.

* Note

Alternative Performance Measures (APM): During the description of the developments and the performance of the Group, ratios such as the EBIT and the EBITDA are utilized.

EBIT (The indicator of earnings before the financial and investment activities as well as the taxes): The EBIT serves the better analysis of the Group’s operating results and is calculated as follows: Turnover plus other operating income minus the total operating expenses, before the financial and investment activities. The EBIT margin (%) is calculated by dividing the EBIT by the turnover.

EBITDA (The indicator of operating earnings before the financial and investment activities as well as the depreciation, amortization, impairment and taxes): The EBITDA also serves the better analysis of the Group’s operating results and is calculated as follows: Turnover plus other operating income minus the total operating expenses before the depreciation of fixed assets, the amortization of grants and the impairments, as well as before the financial and investment activities. The EBITDA margin (%) is calculated by dividing the EBITDA by the turnover.