Comparable opportunities and risks from different areas of the Group are reported together under the following categories where appropriate. The order does not imply any ranking of the categories.

The basis for the assessment of the opportunities and risks of the environment and industry can be found in the sections "Future macroeconomic development" and "Future development of Uzin Utz" of the forecast report.

Risks

Business environment and industry for the Group

The forecast economic development in our core and growth markets is decisive for the opportunities and risks for Uzin Utz arising from the environment and the industry. Overall, global economic growth in 2024 is not expected to reach the level that prevailed before the COVID-19 pandemic. While the largest increase of 2.6% is expected for the US growth market, the anticipated growth rates in our other core and growth countries, which range between 0.3% and 1.1%, are lower. According to the forecasts for the construction industry as a whole, a decline is expected in four of our six core and growth countries in 2024. The forecast growth in construction output in Switzerland and the USA offers opportunities. In addition, despite the expected decline in overall construction output, there are growth opportunities in certain areas of the construction industry in our focus markets, which we will exploit using our strengths.

Forecasts for economic development in our core market of Germany vary, but are at a similar level, ranging from stagnation to a slight increase. A slight decline is expected for construction output, which will be caused by monetary policy penalties and interest rate trends, among other things. Refurbishment measures in the residential construction sector nevertheless offer growth trends that will partially offset the decline in new residential construction. The economic growth Forecast for our core markets of the Netherlands and Switzerland is identical at 1.1% in each case. In the Netherlands, a slight decline in total construction output is expected due to rising construction costs and increasing regulation. However, price increases for both existing and new properties could provide positive impetus for investors. A slight increase in construction investment is forecast for Switzerland, which is due to increased demand in the renovation sector.

The forecast economic growth in the growth markets of the UK and France is also congruent. GDP is expected to increase by 0.6% in both countries. However, a slight decline is expected for the British construction industry and the French market. Despite the expected decline in construction output, there are opportunities for growth, primarily in the area of industrial construction. While building and residential construction in France is expected to decline, the outlook for renovation and maintenance is positive. The USA will live up to its classification as a growth market and is expected to achieve the strongest growth of all core and growth markets in 2024. An increase of 2% is expected in the construction industry, although this represents a decline compared to the high growth rates of previous years. While a decline is expected in the residential construction and renovation sectors, there are opportunities arising from public construction investments, for example.

In addition to the factors that already hampered economic development in the previous year, geopolitical uncertainties have increased. Nevertheless, a recession is not expected in any of our core and growth countries. Estimates for the construction industry vary, with forecasts for our focus countries ranging from a slight decline to a slight increase and therefore close to stagnation. As a result, we are once again confronted with a challenging market environment which, depending on how the sector actually develops, may have a significant impact on business performance and thus lead to a medium risk. Overall, however, there are slight opportunities for growth that are in line with our strengths, which is why we expect to remain profitable in the 2024 reporting year. Despite an expected absolute increase in all cost items, a slight increase in earnings is assumed as a result of cost-cutting measures, for example in the area of logistics and by optimizing material and production costs.

The risks that can be quantified in monetary terms in the "Environment and sector" area amount to a maximum low single-digit million euro amount.

Products

The further development of Uzin Utz is closely linked to the ability to create innovations in the product range and to refine existing formulations. Intensive efforts are aimed at intensifying research and development activities in order to identify market requirements and trends promptly by means of benchmarking and competitive analyses. This serves to prevent the company from falling behind its competitors in terms of technology. It is not possible to precisely quantify potential losses. The risk of technological deficits and the risk of product defects represent significant challenges for the Group. Significant investments in research and development, ongoing in-house innovations and strict internal quality controls are aimed at eliminating product defects from the outset. This is intended to meet the high quality and faultlessness requirements of Uzin Utz products. In the event that damage nevertheless occurs, comprehensive international insurance cover, including product liability, provides protection. Operational risks are covered by prudent provisions.

Customer needs and legal requirements, particularly in the chemical industry, are subject to constant change. New regulations regarding the prohibition or restricted use of certain chemicals or hazardous substances force the Uzin Utz Group to develop innovative formulations that meet these new requirements without compromising product quality. In the course of the REACH regulation (Registration, Evaluation, Authorization and Restriction of Chemicals), importers of raw materials from non-EU countries who import hazardous substances are obliged to register. Uzin Utz is committed to researching substitute raw materials in order to ensure long-term security of supply and greater independence from suppliers without compromising product quality.

Product risks are to be classified as insignificant for the reasons mentioned.

The risks in the "Products" area that can be quantified in monetary terms amount to a maximum low single-digit million euro amount.

Financial and economic conditions

Assessing the extent of financial risks remains challenging in the current situation. In view of potential volatility on the financial markets, it is essential to implement adequate hedging strategies for currency risks, always striving for a balance between costs and expected benefits. The development of currencies that are critical for the Group is discussed in more detail in the "Earnings position" section of this report. Tight receivables and liquidity management throughout the Group guarantees the maximization of available resources, with a particular focus on the continuous monitoring of customers' creditworthiness. The majority of customer receivables are also covered by credit insurance. All significant liabilities to financial institutions are generally taken out for medium to long-term maturities at fixed interest rates or protected against interest rate risks by an interest rate swap. The primary means of financing include bank loans and working capital loans, leasing obligations and trade payables. Their main purpose is to support and maintain operating activities. In addition, the Group has various financial assets, such as trade receivables as well as cash and short-term investments, which contribute to improving liquidity. The Uzin Utz Group has used derivative financial instruments to a limited extent to hedge against interest rate and currency risks resulting directly from business and financing activities. Future possible significant currency and interest rate fluctuations always harbor an inherent risk. A company-wide treasury guideline effectively supports risk management and aims to optimize financial transactions and minimize currency and interest rate risks. The introduction of an integrated liquidity forecast improved quarterly reporting to the Management Board through the use of real-time data. In addition, the project to standardize and automate global payment transaction formats was continued with the aim of managing the Group's payment transactions via a central platform.

For the reasons mentioned, the financial risks are classified as low.

The quantifiable monetary risks in this area amount to a maximum mid-single-digit million euro amount.

Production and essential IT-supported processes

In the production areas of the various sites, continuous maintenance as well as fire protection and preventive measures significantly minimize the risk of suboptimal performance of the production facilities. Special insurance policies have been taken out against damage caused by the elements and the possible resulting business interruptions, although the associated risks cannot be precisely quantified. The Group sees opportunities in the ongoing improvement of production processes and in additional investments in advanced technologies in order to continuously increase the efficiency of production plants worldwide. The increasing networking of international production facilities and strict quality management contribute to the ongoing optimization of production quality across the entire Group.

The operational and production processes as well as the internal and external communication of Uzin Utz are increasingly dependent on information technology. Significant impairments or even the failure of global and regional IT systems could lead to data losses and disruptions in operating and production processes. Targeted technical, structural and organizational measures are taken to minimize the risk of a failure of critical IT systems.

Risks in the area of production and risks relating to IT-supported processes are classified as insignificant.

The risks in these areas that can be quantified in monetary terms amount to a maximum low single-digit million euro amount.

Investments

Risks associated with significant investment decisions are subject to detailed preliminary analyses and require the approval of the Uzin Utz Management Board. If necessary, the expertise of external consultants is consulted for this purpose. Potential takeovers are always assessed with the involvement of external expertise, evaluated by the Management Board and require the approval of the Supervisory Board. Targeted investments lay the foundations for the Group's future growth, continuously creating new opportunities to increase sales and thus improve the Group's overall result.

For the reasons mentioned, the investment risks can be classified as insignificant.

The quantifiable risks in the area of "investments" amount to a maximum very low single-digit million euro amount.

Purchasing, supplier and raw material price risks

For years, Uzin Utz has pursued a multi-supplier strategy in order to minimize dependence on various suppliers and to be able to change them if necessary. Furthermore, framework agreements are concluded with suppliers in order to absorb price increases as far as possible. Through continuous research into substitute raw materials within our research and development departments, we also try to minimize our dependence on suppliers or certain raw materials. Nevertheless, the 2023 reporting year was a very challenging year in terms of procurement, supplier and raw material costs. However, by acting strategically, particularly in the area of procurement, we were able to ensure that we were able to deliver at all times and that we kept costs as low as possible.

The procurement, supplier and raw material price risks can be classified as insignificant thanks to the measures taken. This also reflects the continuous delivery capability of Uzin Utz in the past.

The monetarily quantifiable risks in the areas of "procurement, suppliers and raw material prices" amount to a maximum low single-digit million euro amount.

Personnel risks

Personnel-related risks encompass the range of potential dangers that can arise from the behavior and circumstances of our workforce, including, but not limited to, misconduct, incorrect decisions, accidents at work, health problems or general staff absenteeism. To manage these risks, we implement a variety of strategies within our risk management system. For each identified personnel risk, there are specific measures aimed at reducing the probability of occurrence. Examples include further training, preventative health measures, ensuring safe working conditions and conducting regular employee appraisals in order to effectively minimize the aforementioned risks. The shortage of skilled workers also plays a central role in our risk management system. Active consideration and strategic planning to overcome this shortage are crucial to ensure the long-term competitiveness and productivity of our company. Our primary goal is to establish an open and transparent corporate culture in which all employees feel valued, communicate risks openly and actively work to reduce them in order to limit them as much as possible.

Risks that fall under the category of personnel risks are classified as insignificant.

The risks that can be quantified in monetary terms in the area of "personnel risk" amount to a low four-digit euro sum and are therefore classified as insignificant.

Other risks

The "Other risks" category covers a range of potential risk factors that do not fall directly under the other, specifically defined risk categories. These include, but are not limited to, unforeseeable events or developments that could have an impact on our business activities, financial position or profitability.

Risks that fall under the category of other risks are classified as low.

The risks that can be quantified in monetary terms in the "Other risks" category amount to a maximum mid-single-digit million euro amount.

Risks threatening the existence of the company

None of the risks listed above currently pose a threat to the company as a going concern. There are currently no other identifiable risks to Uzin Utz as a going concern, even taking into account the Group's risk-bearing capacity.

Chance

Most of the risks described also offer the Group opportunities. These are often reflected in risk reduction measures. Due to its size, market position and the internal success factors already described, the Group can and will continue to exploit every commercially viable market opportunity that arises in order to gain further market share. Opportunities for strategically sensible company takeovers will also be closely examined and, if necessary, realized.

In particular, the areas

• Environment and industry,
• Products,
• Financial Instruments,
• Production and essential IT-supported processes
• Investments
• Procurement, supplier and commodity price risks
• Personnel

and, due to their validity for all market participants in conjunction with the Group's high standards in the areas of product quality, service and logistics concept, offer excellent opportunities to expand relationships with existing customers and acquire new customers in order to expand market positions in the respective countries. In this way, we can position ourselves on the market with quality and innovation and differentiate ourselves from our competitors. With regard to further opportunities and risks for Uzin Utz, please also refer to the forecast report.

Extraordinary influencing factors

Towards the end of 2023, there were further geopolitical uncertainties in addition to the war in Ukraine. The uncertainties arising from the armed conflict in the Middle East and increased piracy in the Red Sea, for example, are influencing the development of the global economy. While the loss of export sales to the regions primarily affected will not have a significant negative impact on sales, a worsening of the uncertainties may have an impact on the rest of the value chain. Challenges arising in this context primarily affect the procurement, energy and transportation markets as well as price trends on these markets. We counter these challenges with strategic and operational measures such as the conclusion of framework agreements and the constant monitoring and assessment of the situation.