Uzin Utz SE is listed on the Frankfurt Stock Exchange in the General Standard segment. The parent company of the Group is Uzin Utz Societas Europaea, European Company, (hereinafter also referred to as Uzin Utz SE) with its registered office in Ulm, Dieselstr. 3, Germany. The company is registered under HRB 745224 in the commercial register of the Ulm Local Court. The financial year of the Uzin Utz Group corresponds to the calendar year.

As a full-service provider to the trade, the Uzin Utz Group is personally and reliably dedicated to fulfilling the local and international requirements and needs of its customers. The company offers its customers what it considers to be a unique range of products for floor treatment, from construction chemical product systems and surface finishes to machinery. Almost all of the products offered are developed by the group companies themselves and reflect the high premium standards, from production to distribution to the customer.

The Uzin Utz Group is represented in 53 countries, including 20 countries with production and/or sales companies (as of December 2024).

The business focus is on Germany, the Netherlands and Switzerland. These countries form the core markets of the Uzin Utz Group. Growth markets are located in the USA, Great Britain and France. Emerging markets, which can gradually develop into growth or core markets, include European countries such as Belgium and Poland.

Reporting is in EUR thousand. The preparation of the consolidated financial statements in EUR thousand may result in rounding differences, as the calculations of the individual items are based on figures in EUR. All prior-year figures are shown in brackets.

The presentation of the tables "Statement of changes in equity", "Liabilities" (section 22 Liabilities), "Receivables" (section 16 Trade receivables and other assets) and "Carrying amounts, valuations and fair values" (section Other disclosures > Financial risk management and derivative financial instruments) has been adjusted compared to the previous year in order to provide more transparent information. As a result, only the presentation has changed, not the balance sheet values. There have been no changes in accounting policies, changes in accounting estimates or corrections of errors in accordance with IAS 8.

At the time of approving the financial statements, the Management Board assumes that the Group has sufficient resources to continue its operations in the foreseeable future. Therefore, the consolidated financial statements continue to be prepared on a going concern basis.

The Management Board of Uzin Utz SE approved the Consolidated Financial Statements and the Group Management Report for submission to the Supervisory Board on March 13, 2025. The Supervisory Board has the task of examining the consolidated financial statements and declaring whether it approves the consolidated financial statements. The approval takes place on March 27, 2025.

Application of the International Financial Reporting Standards

The consolidated financial statements for the year 2024 were prepared in accordance with the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS) and the interpretations of the Standing Interpretations Committee (SIC), the International Financial Reporting Interpretations Committee (IFRIC) and the additional requirements of German commercial law pursuant to Section 315e (1) HGB that were mandatory in the European Union on the reporting date.

In the 2024 financial year, the following or revised standards and interpretations relevant to the Group's business activities were applied in the consolidated financial statements of Uzin Utz SE, which were mandatory for the first time in the financial year:

The application of the standards and their interpretations has no material impact on the Uzin Utz Group.

The following standards and interpretations have been published as of December 31, 2024, but are not yet mandatory in the consolidated financial statements of Uzin Utz SE:

The option of early application has not been used to date and is not expected to be used in the future.

The effects of the application of IFRS 18 "Presentation and Disclosures in Financial Statements" cannot yet be conclusively assessed as at December 31, 2024. The new standard replaces IAS 1 "Presentation of Financial Statements" and is mandatory from January 1, 2027. It brings the following significant changes:

• Restructuring of the income statement: introduction of five clearly defined categories - operating, investing, financing, income taxes and discontinued operations.
• New mandatory subtotal: The operating result is introduced, while the profit for the period remains unchanged.
• Certain management-defined performance measures (MPMs) are disclosed in a separate note in the financial statements.
• Improved guidelines for grouping information within the financial statements to increase comparability.
• Amendment to the cash flow statement: Companies are required to use the operating result as the starting point for the indirect determination of cash flow from operating activities.

The Group is currently evaluating and analyzing the potential impact of the new standard for all affected components (income statement, cash flow statement and additional disclosures in the notes) on the above-mentioned changes.

All other standards and their interpretations published as at December 31, 2024 but not yet applied in the Group in the 2024 financial year are not classified as material at the time of preparing the consolidated financial statements.

The consolidated financial statements were prepared in euros in accordance with the functional currency principle pursuant to IAS 21. The statement of comprehensive income follows the nature of expense method.

Consolidation Principles

The consolidated financial statements are based on the financial statements of Uzin Utz SE, the consolidated subsidiaries and the companies accounted for using the equity method, which were prepared in accordance with uniform Group accounting and valuation methods. Where necessary, the annual financial statements of the subsidiaries were adjusted to the uniform Group accounting and valuation methods. The adjustments were based on the IFRS accounting guidelines prepared by the parent company.

Expenses and income, liabilities and assets, equity, intercompany profits and losses and cash flows between the consolidated companies are eliminated as part of the consolidation. In capital consolidation in accordance with IFRS 10, the acquisition costs for the shares of the acquired parent company are offset against the proportionate equity of the subsidiary.

Deferred taxes are recognized on consolidation transactions in accordance with IAS 12.

Business combinations

A business combination occurs when the Uzin Utz Group obtains control over another company. Companies included in the Group for the first time are accounted for using the purchase method in accordance with IFRS 3.4 ff. Under this method, the acquisition costs of a business combination are allocated to the identifiable assets acquired and identifiable liabilities and contingent liabilities assumed in accordance with their fair values at the acquisition date, irrespective of the extent of any non-controlling interests. The portion of the acquisition costs of the investment that exceeds the pro rata net fair values of the identifiable assets, liabilities and contingent liabilities is recognized as goodwill. Non-controlling interests are measured at the proportionate fair value of the assets acquired and liabilities assumed (partial goodwill method).

Negative differences are recognized in the statement of comprehensive income in accordance with IFRS 3.34 after reassessment and remeasurement of the identifiable assets, liabilities and contingent liabilities.

Shares in the equity of subsidiaries that are not attributable to the parent company are reported as "Non-controlling interests" within Group equity.

Changes in shareholdings in subsidiaries that increase or decrease the ownership interest are recognized directly in equity as transactions between equity providers.

Consolidation Methods

Consolidation Group

The consolidated financial statements include the financial statements of the parent company Uzin Utz SE and those companies in which the parent company controls the investee on the basis of voting rights. It controls an investee when it has power over the investee, is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. These controlled companies are fully consolidated from the date of acquisition, i.e. from the date on which the Group obtains control. If the parent company loses control, the subsidiary in question is deconsolidated.

The following overview shows the number of companies included depending on the type of consolidation.

Associated companies and jointly controlled companies

An associated company is a company over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the company in which the investment is held. This possibility generally exists for a shareholding of 20.0% or more, unless this can be clearly refuted. This does not constitute control or joint management of the decision-making processes.

A joint venture is defined as a joint arrangement whereby the parties that have joint control have rights to the net assets of the entity in which they have an interest. Joint control is the contractually agreed, jointly exercised management of a company. This is only the case if decisions on the relevant activities require the unanimous consent of the parties involved in joint control.

Under the equity method, investments in associates or joint ventures are included in the consolidated balance sheet at cost, adjusted for changes in the Group's share of profit or loss and other comprehensive income and any distributions from the associate or joint venture after the date of acquisition. Losses of an associated company or joint venture that exceed the Group's share in this associated company or joint venture are not recognized. They are only recognized if the Group has entered into legal or constructive obligations to assume losses or makes payments in place of the associated company or joint venture.

Investments accounted for using the equity method do not result in any obligations or risks for the parent company.

Non-consolidated companies

Companies that are of minor importance for the presentation of a true and fair view of the Group's net assets, financial position and results of operations, both individually and collectively, and whose inclusion is not justified under the cost-benefit constraint, are not consolidated. They are generally recognized at the lower of cost or fair value in the consolidated financial statements, as there are no indications that the cost does not correspond to the fair value. The total of sales, the balance sheet total and the annual results of the companies not included are less than 1.0% of the corresponding Group value. The companies not included in the consolidated financial statements are as follows:

• Artiso AG (shareholding 50%)
• Uzin Utz Tools Verwaltungs GmbH shareholding 100%)
• codex Verwaltungs GmbH (shareholding 100%)
• Servo 360° GmbH (shareholding 100%)
• Netzwerk Boden GmbH (shareholding 50%)

A list of the shareholdings of the Group companies can be found in the "Other information" section under "Group companies".

Changes in the Group of consolidated companies

In the 2024 financial year, there was the following change in the scope of consolidation (shareholding in brackets)

• FP Floor Protector GmbH (25.1%)

On February 29, 2024, Uzin Utz SE acquired 25.1% of the shares in FP Floor Protector GmbH, based in Wiener Neustadt, Austria, from Puchegger Holding GmbH, also based in Wiener Neustadt, Austria. FP Floor Protector GmbH generates intelligent solutions for all aspects of parquet flooring. With the acquisition of the shares, Uzin Utz aims to expand its technology leadership for the flooring trade.

The purchase price was EUR 1,750 thousand and there were no material costs associated with the acquisition that have an impact on the Group's net assets, financial position or results of operations.

The goodwill resulting from the acquisition amounted to EUR 1,725 thousand, but is not shown in the consolidated financial statements. In the 2024 financial year, FP Floor Protector GmbH generated revenue of EUR 808 thousand and a net profit of EUR 11 thousand. The financial statements were prepared in accordance with local law.

In accordance with the purchase, assignment and option agreement, the Group acquired a further 25.0% shareholding with economic effect from January 1, 2029. In addition, the Group has the option to acquire the remaining 49.9% of the shares in FP Floor Protector GmbH in the period from January 1, 2034 to December 31, 2034. The exercise price is linked to a non-financial variable that is specific to the Uzin Utz Group. Thus, there is no derivative within the meaning of IFRS 9 and the de facto option is exercised due to the treatment of a "pending transaction". Recognition is not required.

The fair value of the identifiable assets and liabilities of FP Floor Protector GmbH and the corresponding carrying amounts at the time of acquisition of the 25.1% are as follows:

Currency translation

The annual financial statements of consolidated foreign companies prepared in a foreign currency are translated in accordance with the functional currency concept (IAS 21). The functional currency is the currency in which a foreign company primarily generates its funds and makes payments. In the Uzin Utz Group, this is the respective national currency for almost all foreign companies. As the companies conduct their business independently, balance sheet items, including goodwill, are translated at the mean rate of exchange on the balance sheet date, equity is translated at historical rates and expenses and income in the statement of comprehensive income are translated at weighted average rates for the year. In accordance with IAS 21.27 ff., translation differences are recognized in other comprehensive income or in profit or loss, depending on the circumstances. Comprehensive income is recognized in the balance sheet at the values determined in the statement of comprehensive income. It was not necessary to adjust the accounting in accordance with the regulations of IAS 29 in conjunction with IFRIC 7, as the Uzin Utz Group does not have any subsidiaries based in hyperinflationary economies.

The consolidated financial statements are prepared and presented in euros, the functional currency of the parent company.

In the individual financial statements included, foreign currency transactions are recognized at the exchange rates applicable at the time of the transaction. Resulting foreign currency receivables and liabilities are measured at the mean rate of exchange on the balance sheet date. Exchange rate gains or losses resulting from the measurement or settlement of foreign currency items are recognized in the statement of comprehensive income. Exchange rate differences arising from the translation of Group companies not reporting in euros are recognized in other comprehensive income.

The main exchange rates for the Uzin Utz Group have developed as follows:

The overall exchange rate impact on Group sales was 0.3% (-0.4).

General accounting and valuation principles

Assumptions and estimates

In preparing the consolidated financial statements, discretionary decisions, estimates and assumptions are made that affect the amount and disclosure of assets and liabilities, income and expenses and contingent liabilities and assets. The assumptions and estimates mainly relate to the uniform Group-wide determination of the economic useful lives of non-current assets, the recognition and measurement of provisions, including for pensions, discount rates and the realizability of future tax relief. The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial years are discussed in the respective subsections.

The Group's assumptions and estimates are based on parameters that were available at the time the consolidated financial statements were prepared. However, assumptions about future developments may change due to market movements and market conditions that are beyond the Group's control. Such changes are only reflected in the assumptions when they occur.

The actual values may differ from the estimates. If the actual development differs from the expected development, the assumptions and - if necessary - the carrying amounts of the relevant assets and liabilities are adjusted accordingly. The assumptions and estimates used as the basis for the consolidated financial statements are subject to certain risks, which arise primarily from general macroeconomic developments.

Estimation uncertainties exist with regard to the assumptions underlying the calculation of the value in use of the cash-generating units. Specifically, this relates to the estimation of growth assumptions and discount rates. In particular, the growth assumptions and thus the expected sales are estimated on the basis of empirical values and individual assessments of the respective opportunities in the respective markets.

The fair value is not always available as a market price. It often has to be determined on the basis of various measurement parameters. Depending on the availability of observable parameters and the significance of these parameters for determining the fair value as a whole, the fair value is allocated to levels 1, 2 or 3.

The classification is made as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the company can access at the measurement date.
• Level 2 inputs are inputs other than quoted prices included within Level 1 that are either directly observable for the asset or liability or can be derived indirectly from other prices.
• Level 3 input parameters are unobservable parameters for the asset or liability.

The Group recognizes reclassifications between different levels of the fair value hierarchy at the end of the reporting period in which the change occurred.

In the case of post-employment benefits, sensitivity analyses were prepared taking into account the extrapolation of realistic changes in the key assumptions at the end of the reporting period to the defined benefit obligation. These are based on a change in a key assumption, while all other assumptions remain unchanged. The values are based on estimates, as it is unlikely that all changes in assumptions will occur. The key actuarial assumptions used to determine the defined benefit obligation are the discount rate, expected salary increases and life expectancy.

When determining the lease term, consideration is given to whether there are factors that make the use of the extension option attractive. Annual planning is also taken into account when determining the lease term, with a planning horizon of five years across the Group.

If the Group is affected by climate-related effects, these are explained in the relevant sections of the notes.

Sales revenues

Sales revenues from contracts with customers

Revenue is generated in the Uzin Utz Group through the sale of goods to wholesalers, craftsmen and contractors and through the provision of services. Across all types of revenue, no financing component is recognized. There is no significant financing component in any case, as there are no payment terms that exceed one year. For this reason, the option under IFRS 15.63 was used, whereby a financing component is not recognized.

The payment terms underlying the types of revenue are explained in the following three sections. As the customer only has a legal claim to consideration after the net payment target has expired, no discount periods were taken into account when determining the payment terms.

Sales of goods to wholesalers, craftsmen and contractors

The Group produces and sells products and machines for laying, renovating and maintaining the value of floor coverings of all kinds. The products are mainly manufactured for the anonymous market and then sold on this market. The products are sold to wholesalers, craftsmen and contractors.

The point in time at which the power of disposal is transferred to the customer is decisive for the realization of revenue. When goods are sold, control is transferred to the customer after delivery has taken place in accordance with the agreed delivery terms. As soon as revenue is recognized, a corresponding receivable is posted. The receivable can be settled by the customer within the net payment target stated on the invoice. A net payment target of 30 days is the most common in the Group. Immediate payment is the second most common arrangement. The third and fourth most important payment terms are net payment terms of 14 days and 10 days. The remaining turnover is distributed over a large number of payment terms, which, however, only account for a small proportion of the turnover of the Uzin Utz Group.

For foreign shipments with longer delivery times, the EXW (Ex Works) delivery term is mainly used. Within the countries in which the national companies are based, short delivery times of between one and three days can often be guaranteed. In addition, last loading and shipping dates are specified in the majority of companies. Depending on the company, the last shipment takes place between one and two weeks before the end of the financial year. Due to the facts explained above, only goods to which an insignificant amount is allocated in comparison to annual sales are on their way to the customer, if at all, as at the balance sheet date.

For the remaining national companies, the delivery date stated on the delivery bill is decisive for revenue recognition. This is determined based on the shipping date and includes the regular delivery times to the customer. The revenue recognition method also mainly involves short delivery times.

Customers with large purchase volumes in particular receive bonuses at the end of the year that are based on the purchase volume for the entire financial year. Revenue may only be recognized if it is highly unlikely that it will be reversed at a later date. Provisions for bonuses based on past experience are recognized during the year to take account of bonuses expected to be granted in the revenue recognized. When determining the reported net sales, these are adjusted for the provisions. As a result, sales are recognized in the amount in which it is highly probable that no significant cancellation will occur.

License sales revenues

License revenue is generated in the form of usage-based license fees. A license was granted for the production of contractually defined products. The license fee for one unit produced per product is defined in the agreement. In addition to a contractually agreed minimum amount per quarter in which licensed products are produced, the amount of the license fees per quarter is derived from the amount of production of the respective products. In accordance with IFRS 15.B63, usage-based royalties are to be recognized at the time the license is used. This is the case when a product for which the license was granted has been produced. The number of products produced per quarter is transmitted to the Uzin Utz Group by the licensee. At present, there is no other database that can be used to obtain information on the number of quantities produced. However, a plausibility check is carried out on the basis of the quantity of premixes and raw materials purchased by the licensee from the Uzin Utz Group, which are required for the production of the licensed products. The license revenue is then recognized in the Group on the basis of the production quantities provided by the licensee. In the same step, a corresponding receivable from the licensee is recorded, which is payable within 120 days.

Provision of services

The services provided within the Group include the maintenance and repair of machines for floor covering removal, floor covering installation and subfloor preparation. These services are performed at a point in time. The Group's performance has been fulfilled when the maintenance has been carried out or the machine has been repaired. At this point in time, the sales revenue is recognized and a receivable is booked. Depending on the company performing the service, the receivable is settled either on a generally applicable payment term of 14 days or based on the payment term defined for the respective customer. In the latter case, receivables from repairs and maintenance of machines are generally settled after 10 or 30 days.

In addition to the maintenance and repair of machines, a few national companies provide services on construction sites, where all activities associated with the installation of new floor coverings are carried out. In this case, it is necessary to examine whether the services are performed over a period of time. This would mean that it would have to be determined on the reporting dates which part of the performance obligation has already been fulfilled and therefore revenue is recognized. In the case of construction site services, the work performed to date can be used to determine the extent to which the performance obligation has already been fulfilled and the amount of revenue recognized as at the reporting date. Confirmation from the customer's project manager serves as proof of this. Revenue is only recognized once the customer has accepted the project and confirmed that the service has been provided in full. In the same step, a receivable is posted, which must be settled within 14 days for the largest project customer. For the remaining project customers, the regularly agreed payment term applies. In the national companies that are active in the project business, the main payment terms agreed are prepayment, 30 days and 60 days. There were no outstanding service projects as at December 31, 2024.

The following disclosures on contract assets and liabilities relate to all types of revenue explained.

Contract assets

A contract asset is a legal claim to consideration for goods or services transferred to a customer, provided that this claim is not solely linked to the passage of time. Contract assets exist, for example, if the fulfillment of a performance obligation is not sufficient for the existence of a legal claim, but another performance obligation must first be fulfilled.

Contract liabilities

A contract liability is defined as an obligation of a company to transfer goods or services to a customer for which it has already received consideration. Contract liabilities exist in the Uzin Utz Group in the form of advance payments received on orders. At the end of the 2024 financial year, contract liabilities amounted to EUR 113 thousand (125). Of the amount of EUR 125 thousand reported in contract liabilities at the beginning of the financial year, EUR 122 thousand (10) was recognized as revenue in 2024. There was no material difference resulting from exchange rate effects. The average period between receipt of the advance payment and provision of the service in the Uzin Utz Group is 2.0 days (1.9). The share of the payment term "advance payment" in total sales revenue also has an influence on the amount of advance payments received on orders and thus on contract liabilities. In 2024, 1.0% (1.3) of the Uzin Utz Group's revenue was paid in advance.

As permitted by IFRS 15, no disclosures are made on the remaining performance obligations as at December 31, 2024, which have an expected original term of one year or less.

Research and development costs

According to IAS 38, research costs may not be capitalized. Costs for research activities are recognized as expenses in the period in which they are incurred. An internally generated intangible asset resulting from development activities or from the development phase is capitalized if certain clearly defined criteria are met. Accordingly, capitalization is always required if the development activity is expected to generate future economic benefits and cash inflows that go beyond the normal costs and also cover the corresponding development costs. In addition, various criteria must be cumulatively fulfilled with regard to the development project or the project or process to be developed.

These prerequisites are predominantly not met in the Uzin Utz Group, as the nature and dimension of the characteristic research and development risks mean that the functional and economic risk of products under development can only be assessed with sufficient reliability when

• the development of the relevant products or processes has been completed and
• once development has been completed, it can be demonstrated that the products meet the necessary technical and economic requirements of the market.

The Group's research and development expenses in 2024 amounted to EUR 14,599 thousand (13,652).

Taxes

Income taxes include both current and deferred taxes and are recognized in the income statement. In addition, deferred taxes are recognized directly in other comprehensive income if they relate to items that are recognized directly in other comprehensive income.

The current income taxes reported relate to corporation tax and trade tax in Germany. In the case of foreign companies, these are mainly performance-related taxes, which are calculated in accordance with the national tax regulations applicable to the individual companies.

Actual tax refund claims and tax liabilities for current and prior periods are measured at the amount expected to be refunded by the tax authorities or paid to the tax authorities. The expected tax payments or refunds are calculated on the basis of the applicable tax rates and tax laws on the balance sheet date.

Deferred taxes are recognized using the liability method for temporary and quasi-temporary differences between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements as at the balance sheet date. Deviating from this, in accordance with IAS 12.21, no deferred taxes are recognized for goodwill that cannot be amortized for tax purposes.

In addition, deferred taxes are recognized for all deductible temporary differences, unused tax loss carryforwards and unused tax credits to the extent that it is probable that taxable income will be available in the next five years against which the deductible temporary differences and the unused tax loss carryforwards and tax credits can be utilized.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and adjusted to the extent that it is not sufficiently probable that the expected benefits from the loss carryforwards will be realized. The assessment made may be subject to change over time, which may lead to a reversal of the valuation allowance in subsequent periods.

Deferred taxes are measured at the tax rates that are expected to apply under current law at the time when the temporary differences are expected to reverse or when the loss carryforwards are expected to be utilized.

Deferred tax assets and deferred tax liabilities are offset in accordance with IAS 12 if the Group has a legally enforceable right to set off current tax assets against current tax liabilities and these relate to income taxes levied by the same taxation authority on the same taxable entity.

Intangible assets

Intangible assets are initially recognized at cost, taking into account incidental acquisition costs. Amortization is recognized as an expense on a straight-line basis over the respective useful lives due to the determinable useful lives. The amortization period for industrial property rights and licenses as well as product know-how is a maximum of 20 years.

The acquisition costs for new software and the costs of implementation are capitalized and amortized over the expected useful life of three to five years.

Costs for internally generated intangible assets are recognized in profit or loss in the period in which they are incurred in accordance with IAS 38.

Goodwill

Goodwill from a business combination is measured at the amount by which the cost of acquisition exceeds the acquirer's interest in the fair value of the identifiable assets, liabilities and contingent liabilities of the company. In accordance with IAS 36, goodwill is not subject to scheduled amortization, but only to unscheduled amortization if a need for impairment is identified. For the purpose of impairment testing, goodwill is generally allocated to cash-generating units that represent the lowest levels within the company at which goodwill is monitored internally for management control purposes and that are not larger than an operating segment as defined by IFRS 8 that has not yet been combined with other segments for the purpose of segment reporting.

Property, plant and equipment

Property, plant and equipment subject to wear and tear are recognized at acquisition or production cost - with the exception of ongoing maintenance costs - less scheduled accumulated depreciation and recognized impairment losses. Production costs are determined on the basis of directly attributable direct costs and measured overheads. Acquisition costs comprise the purchase price, including any import duties and unpaid purchase taxes incurred in connection with the acquisition, as well as all directly attributable costs incurred in bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by the Group. Rebates, discounts and comparable reductions in acquisition costs are deducted.

Assets under construction are recognized at acquisition or production cost less recognized impairment losses. Acquisition or production costs include payments for external services and, in the case of qualifying assets, borrowing costs, which are capitalized in accordance with the Group's accounting policies. These assets are assigned to an appropriate category within property, plant and equipment when they are completed and ready for use. Depreciation of these qualifying assets begins on the same basis as for other property, plant and equipment when they are ready for use.

Depreciation is generally calculated using the straight-line method over the expected useful life of the asset. The following values serve as guidelines for determining the useful life:

Land and assets under construction are not depreciated.

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected from the continued use or sale of the asset.

Gains or losses resulting from the disposal of assets are recognized in profit or loss in the period of disposal.

Impairment

The carrying amounts of the assets of the Uzin Utz Group, with the exception of investment properties (see Investment properties), deferred tax assets (see Income taxes) and financial assets of a financing nature (see Financial assets, securities and derivatives), are reviewed on the balance sheet date to determine whether there are any indications of impairment. The carrying amounts of goodwill and non-depreciable intangible assets must be tested for impairment at least once a year. In addition, in accordance with IAS 36.9 in conjunction with IAS 36.12, an impairment test must be carried out at each reporting date using certain triggering events. If there are indications of possible impairment of the asset, an event-driven impairment test must also be carried out despite the mandatory annual test.

As part of the impairment test, the carrying amount of an asset is compared with its recoverable amount in order to test the asset for impairment.

The recoverable amount is the higher of net realizable value and value in use. Net realizable value is the amount obtainable from the sale of an asset in an arm's length transaction, less the costs of disposal. The value in use corresponds to the present value of estimated future cash flows from the continued use of the cash-generating units with subsequent perpetual annuitization of the cash flows. The value in use must be determined using a present value calculation.

If neither the fair value less costs to sell nor the value in use is equal to the carrying amount, the asset must be written down by the difference and recognized in profit or loss. If goodwill has been allocated, this must be written down first. The carrying amounts of the individual assets of the cash-generating unit are written down pro rata in accordance with their carrying amounts by the depreciation amount or residual depreciation amount (in the case of allocated goodwill), thus reducing the balance sheet items. If the reason for an impairment loss recognized in previous years no longer applies, the impairment loss is reversed up to a maximum of the amortized cost, with the exception of goodwill.

The concept of the impairment test relates primarily to the principle of individual valuation.

Due to existing compound effects and thus non-independent cash flows, the recoverable amount for the Uzin Utz Group is determined on the basis of cash-generating units. The cash-generating units generally represent the legal units of the consolidated financial statements. At the Uzin Utz Group, the recoverable amount corresponds to the value in use, which is determined using the discounted cash flow method. The basis for determining future cash flows is the data from the detailed corporate planning for each individual cash-generating unit. This corporate planning relates to the financial years 2025 to 2029. After this five-year planning period, a transition to perpetuity takes place.

The forecasts - regarding market potential and purchasing behavior - are extrapolated taking into account previous business performance and expected future developments.

Under the current macroeconomic conditions, these estimates are subject to increased uncertainty. If these assumptions and estimates are not confirmed, this could lead to impairment losses being recognized for individual cash-generating units in the future

For the past financial year, the Uzin Utz Group carried out impairment tests in accordance with IAS 36 on the basis of the value in use of cash-generating units as of September 30, 2024 for goodwill. Using the parameters as at the reporting date of 30 September 2024, the cash-generating units have risk-equivalent capitalization rates of between 9.8% (9.9) and 14.6% (14.7). The capitalization interest rate assumes growth of 1.0%. The basis for calculating the capitalization interest rates is a beta factor of 1.0 (0.9). These are pre-tax interest rates. The previous year's figures were also reported as at September 30, 2023, as no triggering events in accordance with IAS 36.9 occurred in 2023. In the case of cash-generating units for which the impairment test leads to an impairment requirement, an update is carried out as at December 31, 2024. For the 2024 reporting year, this related exclusively to Sifloor AG (see section 10 "Intangible assets" > Goodwill). There were no triggering events for the other cash-generating units in 2024, which is why there was no update as at December 31, 2024.

Investment Properties

According to IAS 40.5, investment property is property held to generate income from rental income and / or capital appreciation. These properties are initially recognized at acquisition or production cost, including transaction costs. Subsequent measurement in the Uzin Utz Group is based on the fair value model. If there are significant changes in fair value, the resulting gains and losses are recognized in profit or loss.

An investment property is derecognized upon disposal or when the property is no longer to be used permanently. If no further economic benefit is expected from a future disposal, the property is also derecognized. Gains and losses resulting from the derecognition of an investment property are recognized as income or expense in the income statement.

Financial instruments

"IFRS 9 Financial Instruments" requires the measurement of financial assets, financial liabilities and some contracts to buy or sell non-financial contracts.

Financial instruments are contracts that give rise to a financial asset of one entity and a financial liability or equity instrument of another entity. These include both primary financial instruments (e.g. trade receivables or trade payables), derivative financial instruments (e.g. forward transactions to hedge against value risks) and derivative financial instruments in the context of a hedging relationship (e.g. forward exchange purchase/sale for foreign currency liabilities).

Financial assets and financial liabilities are generally not offset. Offsetting only takes place if there is a legal right to offset and the intention is to settle on a net basis.

Classification and measurement of financial assets

If a reclassification takes place, all affected assets must be adjusted on the first day of the reporting period following the change in the business model. The Uzin Utz Group mainly recognizes financial assets in the form of trade receivables, which continue to be measured at amortized cost when the business model (hold) and cash flow conditions are met. The same applies to trade payables and other liabilities.

Income is recognized on financial assets on the basis of the effective interest rate. This does not apply to instruments classified as at fair value through profit or loss.

Depreciation in value

The IFRS 9 standard requires an impairment model, which is based on an appropriate risk provision to ensure expected losses.

In the Uzin Utz Group, the application of an impairment model in accordance with IFRS 9 is only required for trade receivables. The Uzin Utz Group does not have any financial guarantees or contract assets in accordance with IFRS 15 that fall under the application of IFRS 9. As a rule, lease receivables in the Uzin Utz Group are of a short-term nature. These are tested for individual impairment if necessary. All other financial assets measured at amortized cost are subject to the general impairment model of IFRS 9. However, the Group does not expect any significant default losses from these financial assets in the periods presented.

Impairment losses in accordance with IFRS 9 are shown in the statement of comprehensive income under "Other operating expenses".

As the trade receivables in the Uzin Utz Group are current and therefore do not contain a significant interest component, they are measured using the simplified impairment model (IFRS 9.5.5.15f.). Under this simplified approach, changes in credit risk do not have to be tracked. If necessary, a specific impairment is recognized for credit risks. Possible risks in connection with loan commitments are explained in more detail under "Credit risks". Instead, a risk provision in the amount of the expected default risks is recognized both on initial recognition and on each subsequent reporting date.

Explanations on the impairment matrix and the associated default risks in accordance with IFRS 9 can also be found under "Credit risks".

The general impairment model of IFRS 9 is applied to all other financial assets measured at amortized cost. As the default risks of the counterparties correspond to the original expectations and none of the parties are in arrears with payments, the Group does not expect any significant credit losses from these financial assets in the periods stated. For reasons of materiality, no separate recognition of impairments has therefore been made.

Explanations on financial risk management can be found both under the corresponding item in the notes to the consolidated financial statements and in the risk reporting in the Group management report.

IAS 36, on the other hand, governs the recognition of impairment losses on assets. The Group assesses whether the carrying amount of an asset exceeds its fair value and determines the effects of write-ups or write-downs of assets on the statement of comprehensive income.

An impairment loss may be required for a financial asset or a group of financial assets as part of the impairment test. IAS 36.12 a) - g) sets out the minimum factors to be used to determine whether there is potential for impairment. An entity must assess at least at each balance sheet date whether there is objective evidence that an asset may be impaired.

If there is an indication that an asset is impaired, the recoverable amount of the asset must be estimated (IAS 36.9).

The recoverable amount in accordance with IAS 36.18 is defined as the higher of an asset's fair value less costs to sell and its value in use. If one of these values exceeds the carrying amount of the asset, the asset is not considered impaired and it is not necessary to estimate the other value (IAS 36.19).

If the fair value less costs to sell cannot be determined, the recoverable amount is the value in use of the asset (IAS 36.20). For assets held for sale and for which there is no reason to believe that the value in use significantly exceeds the fair value less costs to sell, the recoverable amount can be regarded as the fair value less costs to sell (IAS 36.21).

Financial assets are derecognized when the contractual rights to payments from the financial assets expire or a transfer of the financial assets with all material opportunities or risks takes place. Financial liabilities are derecognized as soon as the contractual obligations are settled, canceled or expire.

A financial asset is written down if the Group does not reasonably believe that the financial asset will be realized in full or in part. The timing and amount of the write-down is decided accordingly.

Indications that outstanding receivables are partially or fully written off include, for example, if their realization is considered unlikely. This may be the case if the customer's insolvency proceedings have been concluded or all options for collecting the receivables have been exhausted.

Sufficient allowance is always made for all identifiable default risks.

Net gains and losses mainly comprise the effects of impairments and foreign currency valuation recognized in the operating result as well as interest income and expenses recognized in the financial result.

Other financial assets and investments accounted for using the equity method

Other financial assets include shares in affiliated companies and investments that are not included in the consolidated financial statements, other loans, securities held as fixed assets and current derivative financial instruments.

Further information on measurement can be found in the section "Financial risk management and derivative financial instruments". Companies for which the fair values cannot be reliably determined are recognized at cost. Investments accounted for using the equity method are measured in accordance with IAS 28 "Investments in Associates and Joint Ventures".

Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of raw materials, consumables and supplies as well as merchandise is determined using the FIFO (first-in, first-out) method.

In accordance with IAS 2 "Inventories", the production costs of work in progress and finished goods include - in addition to production materials and production wages - pro rata material and production overheads, assuming normal capacity utilization, including depreciation on production facilities and production-related social costs. Interest on borrowed capital is not capitalized under inventories.

Write-downs for significant inventory risks are made to an appropriate and sufficient extent. The principle of loss-free valuation is always observed.

Trade receivables

Trade receivables are initially measured and recognized at fair value plus directly attributable transaction costs. Subsequent measurement is based on the classification in the "amortized cost" measurement category, taking into account the effective interest method.

Impairments in accordance with IFRS 9 are taken into account, see the "Impairment" section.

Other non-financial assets

Non-financial assets are recognized at the lower of nominal value or amortized cost or fair value. These include non-current and current receivables from the tax authorities.

Cash and cash equivalents

Cash in hand, bank balances and cheques are reported under this item. Cash in hand and bank balances are allocated to the "amortized cost" measurement category in accordance with IFRS 9 and measured at fair value at the time of initial recognition, including directly attributable transaction costs. Subsequent measurement is at amortized cost using the effective interest method. Foreign currency items are measured at the exchange rate applicable on the balance sheet date.

Non-current and current financial liabilities

The primary financial instruments reported under this item include financial liabilities to banks and derivative financial instruments. In accordance with IFRS 9, non-derivative financial liabilities are initially recognized at fair value. In the case of financial liabilities not recognized at fair value through profit or loss, directly attributable transaction costs are taken into account. In subsequent periods, they are measured at amortized cost using the effective interest method.

Derivative financial instruments and hedge accounting

Hedging relationships will continue to be measured in accordance with IAS 39 after the application of IFRS 9. The Group only enters into derivative financial instruments as hedging instruments. These hedging transactions are used to manage interest rate and currency fluctuations and serve to reduce earnings volatility. No derivatives are held for trading purposes. Derivatives that do not meet the requirements of IAS 39 for hedge accounting are allocated to the "financial instruments held for trading" category. Derivative financial instruments are recognized as financial assets if their fair value is positive and as financial liabilities if their fair value is negative. When they are concluded, derivative transactions are recognized at cost, which generally corresponds to their fair value. In subsequent years, they are also recognized at fair value. Gains and losses from changes in the fair value of the "financial instruments held for trading" category are recognized immediately in profit or loss.

Hedging relationships that meet the requirements of IAS 39 for hedge accounting are classified as cash flow hedges, as they hedge the risk of fluctuations in cash flows from a highly probable future transaction. The gains and losses resulting from the effective cash flow hedge are recognized in other comprehensive income, taking into account deferred tax effects. If gains and losses result from ineffective parts of the hedge, these are recognized in the statement of comprehensive income or "recycled".

Recycling to the consolidated statement of comprehensive income takes place in the period in which the hedged item is recognized in profit or loss or the hedged item is no longer expected to occur.

Non-current and current lease liabilities

Leases exist if two definitional criteria are met. Firstly, a contract must be based on an identified asset. This is the case if the asset is specified in the contract and the lessor does not have a substantive right to exchange the asset during the term of the contract. Furthermore, the lessor must transfer to the lessee the right to control the use of the identified asset. The lessee has the right to use an asset if it can determine the use of the asset throughout its useful life. In addition, the lessee must be able to obtain, directly or indirectly, substantially all of the economic benefits from the asset.

If a contract is a lease in accordance with IFRS 16, the lease must be recognized in the balance sheet. To determine the liability to be recognized, the payments to be made over the term of the contract are discounted at the beginning of the contract. If no interest rate can be determined on the basis of the contract, the incremental borrowing rate is used for discounting. At the same time as the liability is recognized as a liability, the right of use is capitalized. The basis for the amount to be capitalized is the present value of the payments to be made over the term of the contract. In addition, the right of use includes costs that can be directly allocated to the contract. Following initial recognition in the balance sheet, the liability is extinguished by the lease payments and the capitalized right-of-use asset is amortized on a straight-line basis. If adjustments are made to existing leases, for example the term is extended or the lease payment is increased, the liability and the right-of-use asset are adjusted. For this purpose, the payments to be made after the change are discounted and compared with the liability immediately before the change. Depending on whether the change in the contract results in a reduction or an increase in the liability, the right-of-use asset is adjusted accordingly.

Future increases in the lease payment resulting from the amendment of an index in accordance with the lease agreement are not taken into account when recognizing the liability and the right-of-use asset. The right-of-use asset and the lease liability are only adjusted after the relevant index has changed. When the lease is initially recognized, the lease rate applicable at that time is therefore decisive.

The Uzin Utz Group has decided to make use of the option available for leases of minor value (EUR 4,500.00) or short-term leases (up to twelve months). As a result, leases for low-value assets and short-term leases are not recognized in the balance sheet. Payments for these contracts are recognized in full as expenses in the statement of comprehensive income. Further options in connection with IFRS 16 are not used.

In accordance with IFRS 16, lease liabilities are recognized at the present value of the lease payments to be made. Subsequent measurement is based on the lease payments made during the term of the lease as a reduction of the carrying amount. Changes to the lease can lead to a change in the lease liability. Further information on this can be found in the section "Other information > The Group as lessee".

The Group also acts as a lessor; for more information, see "Other disclosures > The Group as lessor".

Provisions

In accordance with IAS 37 "Provisions, Contingent Liabilities and Contingent Assets", provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the provision. Non-current provisions are discounted if the interest effect resulting from discounting is material.

In the case of defined benefit plans, the cost of providing benefits is determined using the projected unit credit method, whereby an actuarial valuation is carried out at each reporting date. The remeasurements recognized in other comprehensive income are part of retained earnings and are no longer reclassified to the statement of comprehensive income. Past service cost is recognized as an expense when the plan amendment occurs.

The net interest is calculated by multiplying the discount rate by the net liability (pension obligation less plan assets) or the net asset value that results if the plan assets exceed the pension obligation. The defined benefit costs include the following components:

• Service cost (including current service cost, past service cost and any gains or losses from the plan amendment or curtailment)
• Net interest expense or income on the net debt or net asset value
• Remeasurement of the net liability or net asset value

The Group reports the first two components in the income statement under "Personnel expenses". Gains or losses from curtailments are recognized as past service cost. The defined benefit obligation recognized in the consolidated balance sheet represents the current underfunding or overfunding of the Group's defined benefit plans. Any overfunding arising from this calculation is limited to the present value of future economic benefits available in the form of refunds from the plans or reduced future contribution payments to the plans.

Payments for defined contribution plans are recognized as an expense when the employees have rendered the service entitling them to the contributions.

Similar pension obligations of foreign companies are valued analogously.

Trade accounts payable

Trade payables are initially measured and recognized at fair value plus directly attributable transaction costs. Subsequent measurement is based on classification in the "amortized cost" measurement category using the effective interest method.

Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of qualifying assets (assets that necessarily take a substantial period of time to get ready for their intended use or sale) are added to the cost of those assets in accordance with IAS 23 until such time as the assets are substantially ready for their intended use. Income earned from the temporary investment of borrowed capital until it is spent on qualifying assets is deducted from the capitalizable costs of these assets.

All other borrowing costs are recognized in profit or loss in the period in which they are incurred.

Government grants

The Uzin Utz Group recognizes government grants in accordance with IAS 20 "Accounting for Government Grants and Disclosure of Government Assistance" only if there is reasonable assurance that the Group will comply with the conditions attaching to the grants and that the grants will be received. The grants are recognized in profit or loss in the periods in which the corresponding expenses are incurred that are intended to compensate for the government grants.

The Group was granted government grants. One of the grants it received in 2015 amounted to EUR 289 thousand. These grants are tied to the condition that a manufacturing company is active on the property for 15 consecutive years. The production facility became operational in mid-2015. In addition, an employment subsidy of EUR 129 thousand was granted in 2018 on the condition that 18 full-time employees are employed between January 15, 2019 and December 31, 2023. This condition was deemed to have been met and the grant of EUR 129 thousand was recognized as other income in 2023.

In addition, the Group was granted a subsidy of around EUR 441 thousand in 2021 for a plot of land on which another production facility is being built. The grant has been recognized in the balance sheet under "Property, plant and equipment" since the completion of the construction project. The condition for the grant was that the land in question was purchased by February 8, 2021. In addition to this grant, there are other grants amounting to around EUR 1,324 thousand that are subject to further conditions. A minimum investment of around EUR 17,226 thousand in real estate, a minimum investment of around EUR 8,415 thousand in personal property, obtaining a certificate of occupancy for a facility with an area of at least 125,000 m² and the creation of 42 jobs by December 31, 2024, whereby the place of residence for these jobs must be specified, must be fulfilled. In 2023, the American company received the certificate of occupancy and has fulfilled this condition. As all conditions were met cumulatively by December 31, 2024, the remaining grants were recognized pro rata in 2024 as other operating income of EUR 231 thousand. In addition, a receivable of EUR 102 thousand was recognized for the reimbursement of property tax. In the previous year, the probability of the grant being received was estimated to be lower and recognized as a contingent liability.

The benefit of a public loan at a below-market interest rate is treated as a government grant and measured at the difference between the payments received and the fair value of a loan at the market interest rate. The Uzin Utz Group has a first-class credit rating, which is reflected in low bank margins on current overdraft facilities and long-term loans. As of January 1, 2024, the threshold for de minimis aid has been raised from EUR 200 thousand to EUR 300 thousand in three years. As a result, Uzin Utz SE was able to take advantage of a further development loan (environmental program) from the KFW in 2024, which corresponds to the de minimis principle.

Liquidity resources and management in the Uzin Utz Group were always secured for the entire year 2024.

Contingent liabilities and contingent assets

Contingent liabilities are not recognized in the balance sheet. They are disclosed in the notes unless the possibility of an outflow of resources embodying economic benefits is highly unlikely. Contingent assets are not recognized in the balance sheet. However, they are disclosed in the notes if the inflow of economic benefits is probable.

Subsequent events after the balance sheet date

Events after the balance sheet date that provide additional information on the company's position as at the balance sheet date (events requiring recognition) are recognized in the financial statements. Events after the balance sheet date that are not required to be recognized are disclosed in the notes if they are material.