AS Silvano Fashion : SFG 2025 Consolidated Annual Report

About this update from Silvano Fashion Group As

AS Silvano Fashion Group Consolidated Annual Report 2025 (translation of Estonian original) Beginning of the reporting period 1 January 2025 End of the reporting period 31 December 2025 Business name AS Silvano Fashion Group Registration number 10175491 Legal address Tulika 17, 10613, Tallinn, Estonia Telephone +372 684 5000 Fax +372 684 5300 E-mail [email protected] Website https://www.silvanofashion.com Core activities Design, manufacturing and distribution of women's lingerie Auditor Treetiger OÜ * This version of our report is a translation from the original, which was prepared in Estonian. All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the original language version of our report takes precedence over this translation. Table of contents MANAGEMENT REPORT 3 Corporate Governance Report 15 Corporate Social Responsibility 20 Consolidated Sustainability Statement 23 Remuneration report 35 Management Board´s confirmation to the Management Report 36 CONSOLIDATED FINANCIAL STATEMENTS 37 Management´s Board confirmation to the Consolidated Financial Statements 37 Consolidated Statement of Financial Position 38 Consolidated Income Statement 39 Consolidated Statement of Comprehensive Income 39 Consolidated Statement of Cash Flows 40 Consolidated Statement of Changes in Equity 41 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 42 Note 1 General information 42 Note 2 Material accounting policies 42 Note 3 Significant accounting estimates, judgments and uncertainties 50 Note 4 Fair value estimation 52 Note 5 Financial risk management 53 Note 6 Group entities 58 Note 7 Cash and cash equivalents 61 Note 8 Financial assets and financial liabilities 61 Note 9 Trade and other receivables 62 Note 10 Prepayments and tax receivables 62 Note 11 Inventories 62 Note 12 Financial assets at fair value through profit or loss 62 Note 13 Intangible assets 63 Note 14 Investment property 64 Note 15 Property, plant and equipment 65 Note 16 Trade and other payables 66 Note 17 Taxes 67 Note 18 Equity 69 Note 19 Earnings per share 70 Note 20 Revenue from contracts with customers 70 Note 21 Cost of goods sold 70 Note 22 Distribution expenses 71 Note 23 Administrative expenses 71 Note 24 Other operating expenses 72 Note 25 Net finance income/(expense) 72 Note 26 Leases 72 Note 27 Operating segments 74 Note 28 Transactions with related parties 76 Note 29 Events after the reporting date 77 Note 30 Separate financial information of the Parent company 78 DECLARATION OF THE MANAGEMENT BOARD 83 INDEPENDENT AUDITOR'S REPORT 84 INDEPENDENT PRACTITIONER'S LIMITED ASSURANCE REPORT ON CONSOLIDATED SUSTAINABILITY STATEMENT 90 PROFIT ALLOCATION PROPOSAL 93 DECLARATION OF THE SUPERVISORY BOARD 94 ‌MANAGEMENT REPORT General information about AS Silvano Fashion Group AS Silvano Fashion Group (hereinafter "the Group") is a holding company that controls group of enterprises involved in the design, manufacturing, wholesale, franchise and retail sales of ladies' lingerie. The Group's income is generated by sales of Milavitsa, Alisee, Aveline, Lauma Lingerie, Laumelle and Hidalgo branded products through wholesales channel, franchised sales and own retail operated via Milavitsa and Lauma Lingerie retail stores. In 2025 and 2024 key sales markets for the Group were Russia, Belarus, other CIS countries and the Baltics. The Parent company of the Group is AS Silvano Fashion Group (hereinafter "the Parent company"), which is domiciled in Estonia. AS Silvano Fashion Group registered address is Tulika 17, Tallinn, Estonia. The shares of AS Silvano Fashion Group are listed on the Nasdaq OMX Tallinn Stock Exchange and on the Warsaw Stock Exchange. As of 31 December 2025 the Group employed 1 639 people (as of 31 December 2024: 1 655 people). The Group comprises the following companies: Ownership interest Ownership interest Location Main activity 31.12.2025 31.12.2024 Parent company AS Silvano Fashion Group Estonia Holding Entities belonging to the Silvano Fashion Group: CJSC Silvano Fashion* Russia Retail and wholesale 100% 100% LLC Silvano Fashion Belarus Retail and wholesale 100% 100% LLC Silvano Fashion Ukraine Wholesale 100% 100% SIA Silvano Fashion Latvia Retail 100% 100% CJSC Milavitsa Belarus Manufacturing and wholesale 85.02% 85.02% JSC Sewing firm Yunona** Belarus Manufacturing and wholesale 58.33% 58.33% LLC Gimil*** Belarus Manufacturing and wholesale 100% 100% JSC Lauma Lingerie Latvia Manufacturing and wholesale 100% 100% Alisee SARL Monaco Holding 99% 99% JSC Metropolitan Trade Russia Holding 100% 100% Company Milavitsa **** LLC Baltsped logistik Belarus Logistics 50% 50% * CJSC Silvano Fashion is 100% owned by JSC Metropolitan Trade Company Milavitsa (same was effective as of 31.12.2024). ** JSC Sewing firm Yunona is owned by AS Silvano Fashion Group with the share of 49.27% and SIA Silvano Fashion with the share of 9.07%, the rest of the 41.66% shares belongs to the investors outside the consolidation group (same was effective as of 31.12.2024). *** LLC Gimil is owned by AS Silvano Fashion Group with the share of 99.80% and SIA Silvano Fashion with the share of 0.20% (same was effective as of 31.12.2024). **** JSC Metropolitan Trade Company Milavitsa is owned by AS Silvano Fashion Group and SIA Silvano Fashion, each holding 50% (same was effective as of 31.12.2024). In addition, as of 31.12.2025 the subsidiary of AS Silvano Fashion Group, CJSC Milavitsa, had investment in associate LLC Trade house "Milavitsa" Novosibirsk with a 25% ownership interest (same was effective as of 31.12.2024). Group strategy is focused on the implementation of the proven business model of a vertically-integrated fashion group with brand management, strong retail operations, its own flexible production facilities and outsourcing expertise, differentiated independent sources of raw materials, and integral logistics. The Group aims to create value by offering a wide variety of lingerie in an attractive environment with good service, excellent quality and reasonable prices. Selected financial and non-financial indicators Summarized selected financial indicators of the Group for 12 months of 2025 compared to 12 months of 2024 and 31 December 2025 compared to 31 December 2024 were as follows: in thousands of EUR 12m 2025 12m 2024 Change Revenue 55 466 58 070 -4.5% Gross Profit 29 262 34 278 -14.6% Operating profit 10 435 17 248 -39.5% EBITDA 13 878 20 316 -31.7% Net profit for the period 10 034 13 673 -26.6% Net profit attributable to equity holders of the Parent 9 229 12 366 -25.4% company Earnings per share (EUR) 0,26 0,34 -23.5% Operating cash flow for the period 8 170 10 092 -19.0% in thousands of EUR 31.12.2025 31.12.2024 Change Total assets 93 847 84 489 11.1% Total current assets 79 659 70 871 12.4% Total equity attributable to equity holders of the Parent company 76 768 65 993 16.3% Cash and cash equivalents 6 639 7 683 -13.6% Short-term deposits over 3 months 38 311 32 007 19.7% Margin analysis, % 12m 2025 12m 2024 Change Gross profit 52.8 59.0 -10.5% Operating profit 18.8 29.7 -36.7% EBITDA 25.0 35.0 -28.6% Net profit 18.1 23.5 -23.0% Net profit attributable to equity holders of the Parent company 16.6 21.3 -22.1% Financial ratios, % 31.12.2025 31.12.2024 Change ROA 10.0 15.8 -36.7% ROE 12.5 20.6 -39.3% Price to earnings ratio (P/E) 4.9 3.0 63.3% Current ratio 8.6 6.6 30.3% Quick ratio 5.2 4.0 30.0% Underlying formulas: EBITDA = net profit for the period + depreciation and amortization -/+ net finance income/expense + income tax expense Gross profit margin = gross profit / revenue Operating profit margin = operating profit / revenue EBITDA margin = EBITDA / revenue Net profit margin = net profit / revenue Net profit margin attributable to equity holders of the Parent company = net profit attributable to equity holders of the Parent company / revenue ROA (return on assets) = net profit attributable to equity holders of the Parent company / average total assets ROE (return on equity) = net profit attributable to equity holders of the Parent company / average equity attributable to equity holders of the Parent company Earnings per share = net profit attributable to equity holders of the Parent company / weighted average number of ordinary shares Price to earnings ratio (P/E) = Share price at the end of reporting period / earnings per share, calculated based on the net profit attributable to equity holders of the Parent company Current ratio = current assets / current liabilities Quick ratio = (current assets - inventories) / current liabilities Own & franchise store locations, geography Group-managed stores and franchised stores at the end of 2025: Own Franchise Total Russia 69 312 381 Belarus 65 0 65 Baltics 3 17 20 Other regions 0 92 92 Total 137 421 558 At the end of the reporting period the Group and its franchising partners operated 536 Milavitsa and 22 Lauma Lingerie brand stores, including 137 stores operated directly by the Group. At the end of 2024 there was a total of 124 of Group-managed stores and 440 franchise stores. Total selling area of Group-managed stores as of 31 December 2025 reached 12 394 (31 December 2024: 11 562) square meters with the following breakout by prime locations: 31.12.2025 31.12.2024 Change Russia 5 233 4 393 19.12% Belarus 7 088 6 864 3.26% Baltics 73 305 -76.07% Total 12 394 11 562 7.20% Business environment in 2025 Core operating markets for the AS Silvano Fashion Group in 2025 and 2024 were Russia, Belarus, other CIS countries and the Baltics. The Group's results for the 12 months of 2025 were determined by the situation in the economy of the main markets - Russia and Belarus. In addition, the whole Group's operations were impacted by situation in Ukraine. It had a significant impact not only on the money and capital markets, but also on the movement of goods, commercial trade, and supply chains, as well as on energy supplies. In Belarus the economy appeared stable during 2025: Cumulative GDP growth reached level of 1.3% in 2025. Slower domestic demand and subdued business activity in Russia constrained Belarus' GDP dynamics. As a result, economic overheating declined significantly in the second half of last year, the labor shortage stopped progressing, and inflation slowed by the end of 2025 and amounted to 6.8% in December 2025. GDP growth in Russia grew by 1% in 2025, showing a slow-down comparing to 4% in 2024. Surging domestic demand, labour shortages and weak import-substitution capacity pushed the inflation rate in Russia to 5.59 percent in December 2025 compared to the same month in the previous year. Key rate of Central Bank was steadily decreasing from 21% to 16% throughout the year. 2025 proved calmer but still challenging for the Baltic region. Negative economic sentiment was eased by euro-zone interest rates started to drift lower. Notwithstanding the macroeconomic and geopolitical shocks, the Group's business continues to be strong and resilient as the Group was able to adapt to rapidly changing environment. The management of the Group monitored the situation closely during the reporting year and will continue to keep a close eye on the development of the geopolitical situation in Eastern Europe and the potential implications for the Group. Business outlook Group`s business is built on good quality, reasonably priced and known to our current target markets lingerie products. Our business is sustainable and is built on solid brands. Further to this, the Group has a strong distribution network with a total of 558 shops, of which 137 are managed by ourselves. AS Silvano Fashion Group is well positioned given its strong brands, very good product range, reasonable price point, a focus on the functional segment of lingerie products. More specifically, AS Silvano Fashion Group will focus on the following: The Group will continue building leaner organizational structure in order to make management of the Group more transparent and efficient; Group`s distribution companies (Russia, Belarus) will focus on the development of sales network, opening new stores and supporting of franchise businesses in order to increase sales and profitability; Group`s manufacturing companies will continue with optimization of product portfolio in order to streamline purchasing and manufacturing activities and be in line with market trends; The Group will continue with optimization of operational costs and personnel. The Group is open to partnerships, which could widen range of Group`s activities or sales geography. On the store openings, we try to shift the mind-set of our partners from quantity to quality that should ultimately increase the profitability of their business, and reduce the risk of failure. We advocate for store openings, since it allows us and our franchise partners to control revenue stream better. Russia Economic Outlook The Group's sales on the Russian market amounted to 30 808 thousand EUR, decrease is 9.3% compared to 12 months of 2024. Local currency sales decreased by 14.3% during 12 months of 2025 compared to the same 12 months of 2024. Group will focus on improving profitability of its retail business. We will also continue to expand our store chain there depending on the availability of reasonably priced sales areas. At the end of the reporting period, there were a total of 69 stores operated by the Group itself (as of 31 December 2024: 57 stores). Belarus Economic Outlook The Group's sales in Belarus in the 12 months of 2025 were 17 347 thousand EUR and increased by 9.0% compared to the 12 months of 2024. Sales in local currency increased by 7.3% during the same period. At the end of the reporting period, there were a total of 65 stores operated by the Group itself (as of 31 December 2024: 62 stores). Ukraine Economic Outlook The Group's sales in Ukraine in the 12 months of 2025 were 70 thousand EUR and decreased by 35.2% compared to the 12 months of 2024. Financial risks The operations of the Group may be accompanied by a variety of financial risks, including the credit risk, liquidity risk, risk of changing interest rates and exchange rates having the most significant impact. Financial risk management falls within the sphere of competence of the Group's Management Board which seeks to minimize potential adverse effects of financial risks on the financial performance of the Group and includes the identification and measurement of the risks and checking the efficiency of the alleviation measures. The purposes of financial risk management are the alleviation of financial risks and the reduction of the volatility of the financial results. The financial risk management of the Group is guided by the risk management strategy established in the Group. The Supervisory Board of the Group is in charge for supervision of the measures taken by the Management Board to alleviate the risks. More information on the financial risks is disclosed in the Note 5 Financial Risk Management to the Consolidated Financial Statements. Financial performance Overall, Group sales decreased by 4.5% compared to 12 months of 2024 (for 12 months of 2024 sales decreased by 0.9% compared to 12 months of 2023). Wholesale revenue decreased by 13.3%. The Group's gross profit during 12 months of 2025 amounted to 29 262 thousand EUR and decrease by 14.6% compared to previous year (12 months 2024: 34 278 thousand EUR and increase of 1.6% comparing to 12 months of 2023). The gross profit margin during 12 months of 2025 decreased by 10.5% compared to 12 months of 2024 (12 months 2024: increase of 2.4% comparing to 12 months of 2023). Consolidated operating profit for 12 months of 2025 amounted to 10 435 thousand EUR, compared to 17 248 thousand EUR for 12 months of 2024, decrease by 39.5%. The consolidated operating profit margin was 18.8% for 12 months of 2025 (29.7% for 12 months of 2024). Consolidated EBITDA for 12 months of 2025 decreased by 31.7% and amounted to 13 878 thousand EUR, which is 25.0% in margin terms (20 316 thousand EUR and 35.0% for 12 months of 2024). Reported consolidated net profit attributable to equity holders of the Parent company for 12 months of 2025 amounted 9 229 thousand EUR, compared to net profit of 12 366 thousand EUR for 12 months of 2024, net profit margin attributable to equity holders of the Parent company for 12 months of 2025 was 16.6% against net profit margin 21.3% for 12 months of 2024. Financial position As of 31 December 2025 consolidated assets amounted to 93 847 thousand EUR representing increase by 11.1% as compared to the position as of 31 December 2024 (31 December 2024: 84 489 thousand EUR and increase of 16.9% comparing to 31 December 2023). The main driver of this change is significant increase in highly liquid assets. The Group continued to accumulate additional liquidity in the form of cash and short-term bank deposits throughout 2025 and as at 31 December 2025 has increased its cash reserves and short-term bank deposits located in Estonia by EUR 1 812 thousands or 4.9%. Inventory balance increased by 2 932 thousand EUR and amounted to 31 237 thousand EUR as of 31 December 2025 (31 December 2024: 28 305 thousand EUR). The growth is caused by overall inflation and quantitative increase in inventories, as well as strengthening of RUB and BYN against euro. Trade and other receivables increased by 123 thousand EUR as compared to 31 December 2024 and amounted to 1 329 thousand EUR as of 31 December 2025 (31 December 2024: 1 206 thousand EUR). Equity attributable to equity holders of the Parent company increased by 10 775 thousand EUR and amounted to 76 768 thousand EUR as of 31 December 2025 (31 December 2024: 65 993 thousand EUR). Current liabilities decreased by 1 414 thousand EUR during 12 months of 2025. Sales structure Sales by markets Group sales in its 2 major markets - Russia and Belarus - were 86.8% of its total sales in 2025. 12m 2025 12m 2024 Change Change, % Russia, th RUB 2 879 836 3 361 697 -481 861 -14.3% Belarus, th BYN 59 977 55 877 4 100 7.3% Group sales results by markets measured in EUR are presented below: in thousands of EUR 12m 2025 12m 2024 Change, EUR Change, % 12m 2025, % of sales 12m 2024, % of sales Russia 30 808 33 959 -3 151 -9.3% 55.5% 58.5% Belarus 17 347 15 914 1 433 9.0% 31.3% 27.4% Ukraine 70 108 -38 -35.2% 0.1% 0.2% Baltics 1 221 1 294 -73 -5.6% 2.2% 2.2% Kazakhstan 2 151 2 737 -586 -21.4% 3.9% 4.7% Moldova 1 996 2 103 -107 -5.1% 3.6% 3.6% Other markets 1 873 1 955 -82 -4.2% 3.4% 3.4% Total 55 466 58 070 -2 604 -4.5% 100.0% 100.0% Sales by business segments in thousands of EUR 12m 2025 12m 2024 Change, EUR Change, % 12m 2025, % of sales 12m 2024, % of sales Wholesale 30 785 35 517 -4 732 -13.3% 55.5% 61.2% Retail 24 530 22 482 2 048 9.1% 44.2% 38.7% Other operations 151 71 80 112.7% 0.3% 0.1% Total 55 466 58 070 -2 604 -4.5% 100.0% 100.0% The main wholesale regions were Russia and Belarus. Investments During 12 months of 2025 the Group's investments into property, plant and equipment totalled 805 thousand EUR, in previous year same period 942 thousand EUR. Investments were made mainly into opening and renovating own stores, as well into equipment and facilities to maintain effective production for future periods. During 12 months of 2025 the Group has opened 18 new stores (15 stores in Russia and 3 stores in Belarus) and closed 5 stores (3 stores in Russia and 2 stores in Latvia). The Group is planning to invest during year 2026 around 507 thousand EUR to existing operations, of which about half is planned to open new stores and the renovation of existing retail stores, and the second half mainly for the updates of the software programs and renew production technology and equipment. Research & development achievements The Group carries out research, development and innovation activities in all areas of its business with the aim of improving the manufacturing and distribution processes and developing technologies that facilitate business management, either using its own resources or with the help of third parties. During the reporting year, we continued to implement new components of the 1C:ERP Enterprise Management 2 for Belarus software. The following were put into trial operation: Trading platform integration Integration with the labelling system (ERP + E-DMARK + customer data exchange) Electronic document management In 2026, we plan to complete and commission the following: Marketing subsystem (generating reference information for preparing commercial proposals to clients) Sales subsystem + Customer order reservations Cost of goods sold subsystem The implementation will optimize some of the Group's business processes in Belarus, provide expanded analytical data, and facilitate employee work. The total investment in 2025 for the software implementation was €7,000. As of the end of 2025, the project is 98% complete. Seasonality of business The operations of AS Silvano Fashion Group are not exposed to major seasonal fluctuations. As is common for clothing and fashion business, especially lingerie segment, the fourth quarter is lower than average sales (respectively -20% of the average quarterly revenue in 2025). The second and third quarters was slightly higher than quarterly average revenue (+ 18% and +15% in 2025). Half year results are fairly equal, in recent years. A similar trend is also part of the operating profit. 16 412 2025 vs 2024 15 951 12 016 11 087 10 000 -14% - -4% -6% -8% -10% -12% -14% -16% Q1 Q2 Q3 Q4 12m 2025 2024 30 000 20 000 -4% -4% 40 000 -2% -2% 50 000 2% 0% 55 466 1% 60 000 Silvano Fashion Group revenue 2024 and 2025 (th EUR) 2025 2024 Q4 Q3 Q2 Q1 20% 15% 10% 5% 0% 20% 20% 25% 24% 22% 28% 29% 28% 30% 30% 35% Share of quarterly revenue (% of total year) Personnel As of 31 December 2025, the Group employed 1 639 employees, including 552 people in retail operations. The rest were employed in production, wholesale, administration and support operations. As of 31 December 2024 there were 1 655 employees, including 518 people in retail operations. Total gross salaries and related taxes during 12 months of 2025 amounted to 15 800 thousand EUR (14 155 thousand EUR in 12 months of 2024). The teams of the AS Silvano Fashion Group companies comprise of highly-qualified and professional specialists who have long-term experience in the women's lingerie industry. To meet the growing demands of its business the Group pays careful attention to the development of all levels of management and to the training of own personnel and subcontractors, who need to meet common Group requirements and perform in line with the overall strategy of the Group. AS Silvano Fashion Group continually works with its employees and business partners to ensure the sustained success of the Group. The objective of the human resources policy of Silvano Fashion Group is to value, develop and respect the Group's employees based on common principles, involving human resources management and planning, well thought out recruitment and selection processes, followed by purposeful and motivational development and the establishment of an environment that supports it. We are guided by the principle that success is based on loyal, committed, ethical and result-oriented employees. Key events during 2025 until the release of Annual Report On June 5, 2025 Silvano Fashion Group held its Extraordinary Meeting of Shareholders. The Meeting adopted the following decisions: The Meeting appoint the auditing company Ernst & Young Baltic AS (registry code 10877299, located at Rävala puiestee 4, 10143 Tallinn) as the auditor of AS Silvano Fashion Group for the financial year ended 31 December 2024; On July 03, 2025 Silvano Fashion Group held its regular Annual General Meeting of Shareholders. The Meeting adopted the following decisions: The Meeting approved the 2024 Consolidated Annual Report. The Meeting decided to leave the net profit undistributed and include the net profit of the financial year 2024 in retained earnings. The Meeting decided to extend the term of office as members of the Supervisory Board for five (5) years until June 30, 2030 for Toomas Tool, Mari Tool, Triin Nellis, Risto Mägi, Stephan David Balkin. During the reporting year, AS Silvano Fashion Group continued to expand its store network in Russia and Belarus. Specifically, in 2025, the group opened 15 stores in Russia (including 4 stores in Saratov, 3 stores in the Moscow region, 2 stores in Moscow, 2 stores in Engels, 1 store in the St. Petersburg region, 1 store in Murmansk, 1 store in Sochi, and 1 store in Yekaterinburg) and 3 stores in Belarus (including 1 store in Smorgon and 2 stores in Minsk). It also closed 3 stores in Russia (including 1 store in the Moscow region, 1 store in St. Petersburg, and 1 store in Sochi) and 2 stores in Latvia. Shares of AS Silvano Fashion Group Nasdaq OMX Tallinn Stock Exchange Warsaw Stock Exchange ISIN Ticker List/segment EE3100001751 SFG1T BALTIC MAIN LIST EE3100001751 SFG MAIN LIST Issuer Silvano Fashion Group (SFG) Silvano Fashion Group (SFG) Nominal value 0.10 EUR 0.10 EUR Total number of securities 36,000,000 36,000,000 Number of listed securities 36,000,000 36,000,000 Listing date 20.05.1997 23.07.2007 As of 31 December 2025, the registered share capital of AS Silvano Fashion Group amounted to 3 600 thousand EUR divided into 36 000 000 ordinary shares with a nominal value of 0.1 EUR each. The share register is electronic and maintained at the Estonian Central Register of Securities. The Group has been listed on Nasdaq OMX Tallinn Stock Exchange since 20 May 1997 I-list and since 21 November 2006 main list and on Warsaw Stock Exchange since 23 July 2007. Ordinary shareholders are entitled to receive dividends when the company distributes them. Each ordinary share gives one vote at the general meeting of shareholders of AS Silvano Fashion Group. The shares are freely transferable, there are no restrictions imposed on them by the articles of association likewise there are no restrictions imposed on the transfer of securities concluded between the company and its shareholders. There are no known restrictions imposed on the transfer of securities laid down in the contracts between the shareholders. Information on shares of AS Silvano Fashion Group Key share details 2021 2022 2023 2024 2025 Number of shares outstanding at year end 36 000 000 36 000 000 36 000 000 36 000 000 36 000 000 Weighted average number of shares 36 000 000 36 000 000 36 000 000 36 000 000 36 000 000 Year-end share price, in EUR 1.965 1.12 1.13 1.02 1.25 Earnings per share, in EUR 0.25 0.33 0.28 0.34 0.26 Dividend per share, in EUR n/a n/a n/a n/a n/a Dividend / Net profit n/a n/a n/a n/a n/a Price to earnings ratio (P/E) 7.86 3.39 4.10 3.00 4.79 Share price performance and trading history In 2025, AS Silvano Fashion Group share price increased by 22.5% and the Group's market capitalization increased by EUR 8.28 million. Nasdaq OMX Tallinn Stock Exchange 2021 2022 2023 2024 2025 trading history High, in EUR 2.195 2.078 1.204 1.188 1.535 Low, in EUR 1.55 0.6601 0.99 0.90 1.02 Last, in EUR 1.965 1.12 1.13 1.02 1.25 Traded volume 6 319 071 5 992 900 3 170 330 2 628 899 3 173 413 Turnover, in EUR million 10.95 6.55 3.52 2.75 3.97 Market capitalization, in EUR million 70.74 40.32 40.68 36.72 45.00 Share price development and turnover on the Nasdaq OMX Tallinn Stock Exchange during 12 months of 2025 (EUR) During 12 months of 2025 the highest and lowest prices of the AS Silvano Fashion Group` share on the Nasdaq OMX Tallinn Stock Exchange were 1.535 EUR and 1.02 EUR, respectively. 1,6 1,5 1,4 1,3 1,2 1,1 1 0,9 200000 160000 120000 80000 40000 0 Volume SFG1T share price 150,00% 140,00% 130,00% 120,00% 110,00% 100,00% 90,00% SFG1T share price OMXBBGI Warsaw Stock Exchange trading history 2021 2022 2023 2024 2025 High, in PLN 9.88 9.10 7.60 6.33 5.94 Low, in PLN 6.66 3.29 4.00 3.85 4.24 Last, in PLN 8.52 5.72 5.58 4.63 5.28 Traded volume 115 488 261 426 485 817 351 162 243 307 Turnover, in PLN million 0.93 1.20 2.52 1.73 1.30 Share price development on the Warsaw Stock Exchange during 12 months of 2025 (PLN) During 12 months of 2025, the highest and lowest prices of the AS Silvano Fashion Group` share on the Warsaw Stock Exchange were 5.94 PLN and 4.24 PLN respectively. 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 6 5,5 5 4,5 4 Volume SFG share price (WSE) 150% 140% 130% 120% 110% 100% 90% 80% SFG share price (WSE) WIG 20 The members of the Management Board of AS Silvano Fashion Group have no right to issue or buy back shares of AS Silvano Fashion Group without permission and terms given by the shareholders meeting. In addition, there are no commitments between the Group and its employees providing for compensation in case of mergers and acquisitions under chapter 19 of Securities Market Act. Shareholder structure As of 31 December 2025 AS Silvano Fashion Group had 2 485 shareholders (as of 31 December 2024: 2 770 shareholders). All shares issued by AS Silvano Fashion Group are registered ordinary shares. Each ordinary share grants the holder one vote at the general meeting of shareholders. The Group does not issue share certificates to shareholders. The Group's share register is electronic and maintained at the Estonian Central Register of Securities. Each ordinary share grants the holder the right to participate in profit distributions in proportion to the number of shares held. The distribution of shares as of 31 December 2025 and 31 December 2024: 31.12.2025 31.12.2024 Shareholding s Number of shareholders % of votes Number of shares Number of shareholders % of votes Number of shares >10% 2 44.46 16 007 208 2 43.99 15 835 931 1.0-10.0% 12 35.02 12 605 950 13 34.42 12 389 906 0.1-1.0% 39 10.13 3 647 985 42 10.92 3 932 563 <0.1% 2 432 10.39 3 738 857 2 713 10.67 3 841 600 Total 2 485 100,00% 36 000 000 2 770 100.0% 36 000 000 Largest shareholders of AS Silvano Fashion Group (% of votes): The main shareholders of the Group as at 31 December 2025 compared to 31 December 2024 are presented in the table below: 31.12.2025 31.12.2024 BALTPLAST AS 22,24% 21,77% AS SEB Pank Clients 22,22% 22,22% BREM AVARII OSAÜHING 5,56% 5,56% UNICREDIT BANK AUSTRIA AG 5,49% 5,49% SWEDBANK AB CLIENTS 5,24% 2,34% CLEARSTREAM EUROPE AG 4,26% 3,92% SWEDBANK AS CLIENTS 3,21% 3,18% NORDEA BANK ABP/NON TREATY CLIENTS 2,53% 2,56% SIGNET BANK AS CLIENTS 1,98% 0% Krajowy Depozyt Papierow Wartošciowych S.A. 1,77% 1,99% AB SEB BANKAS 1,50% 1,25% FIREBIRD REPUBLICS FUND LTD 1,28% 1,28% INTERACTIVE BROKERS LLC Client Omnibus Account 1,15% 1,15% VSG Invest OÜ 1,04% 1,28% CITIBANK ( NEW YORK) / GOVERNMENT OF NORWAY 0% 2,43% Shareholders who had over 1% of all votes as at 31 December 2024: Olegs Radcenko did not have shares on 31 December 2025. Because the allocation of voting rights does not necessarily coincide with legal ownership, the shareholders' register of the Group may not include full details of persons who hold over 5% of voting rights represented by its shares. Shares held by the members of the Management board and the Supervisory Board The members of the Management board and the Supervisory Board did not have direct shareholding in Silvano Fashion Group AS as of 31 December 2025 (and 31 December 2024). During 2025 (and 2024) financial year there was no buy-back of shares of AS Silvano Fashion Group. Dividends AS Silvano Fashion Group is under no permanent or fixed obligation of paying dividends to its shareholders. Recommendations of the Management Board and the Supervisory Board for profit allocation are based on financial performance, requirements for current capital management, investment needs and strategic considerations. The decision on distribution of profit is made by the general meeting of shareholders on the basis of approved annual report. ‌Corporate Governance Report The shares of AS Silvano Fashion Group have been admitted to trading on the Nasdaq OMX Tallinn Stock Exchange and the Warsaw Stock Exchange. Two corporate governance codes apply to the Group: the Corporate Governance Recommendations adopted by the NASDAQ OMX Tallinn Stock Exchange and the Estonian Financial Supervision Authority (hereinafter CGR); Corporate Governance Principles for WSE Listed Companies titled "Best Practice for GPW Listed Companies 2021" (hereinafter GPW CGP). In accordance with the CGR and GPW CGP the Group shall describe its management practices in corporate governance recommendations report and confirm its compliance or not with CGR and GPW CGP. If the Group does not comply with CGR and/or GPW CGP, the Group shall explain in the report the reasons for its non-compliance. The Code of Best Practice for WSE Listed Companies provides the same obligation which is applicable to the Group due to its listing on the Warsaw Stock Exchange. The GPW CGP of the Warsaw Stock Exchange is similar to the CGR of the Nasdaq OMX Tallinn Stock Exchange. The Management Board and the Supervisory Board of the Parent company confirm, to the best of their knowledge that they did everything possible to ensure that the management practices were in compliance with CGR and GPW CGP in all substantial matters during the reporting year. If the management practices deviated, in the Management Board's and/or the Supervisory Board's opinion, from particular provisions of CGR and/or and GPW CGP during 2025 such a deviation is explained below. AS Silvano Fashion Group has not implemented a diversity policy as required by principle 2.1 of GPW CGP, which applies to all group companies yet, as we operate in many different legislative and cultural zone countries, most of them non-EU countries. But we follow diversity principles in our company culture and everyday activities to ensure that there is sufficient diversity in the governing bodies among the Group entities to have different opinions and views in the management positions and freedom to introduce new ideas. This approach will support effective management's decisions, the leadership and supervision of the exercise by the board and management teams and, therefore, the results of the companies. Diversity increased transparency will contribute significantly to the promotion of equal treatment and the fight against discrimination in the relevant decision-making bodies of other companies. Religion or belief, disability, age or sexual orientation discrimination as well as discrimination based on sex, racial and ethnic origin in the employment and occupation is not acceptable in the company culture of AS Silvano Fashion Group. General Meeting of Shareholders The highest governing body of the Group is the General Meeting of Shareholders. The competence of the General Meeting, the procedure for calling a meeting and passing of decisions is set forth in the Articles of Association of the Parent company. The annual general meeting is held once a year and extraordinary general meetings may be convened by the Management Board in the events prescribed by law. The general meeting is competent to change the articles of association, elect members of the Supervisory Board and decide on their remuneration, appoint an auditor, approve the annual report and allocate profit, as well as decide on other matters stipulated by the articles of association and laws. The articles of association do not provide for any rights to shares of a different class which would bring about unequal treatment of shareholders in voting. The General Meeting shall decide on amendment of the Articles of Association of the Company according to the procedure laid down in law and an amendment to the Articles of Association shall take effect upon making a relevant entry in the Commercial Register A general meeting can adopt resolutions if over one-half of the votes represented by shares are present. A resolution of general meeting is adopted if over one-half of the votes represented at the meeting are in favour unless a larger majority is required by law. A resolution on amendment of the articles of association shall be adopted if at least two-thirds of the votes represented at a general meeting are in favour. The resolutions of the general meeting were published on Nasdaq OMX Tallinn and Warsaw stock exchanges and on Parent company's website in Estonian and English language. During 2025 the Group held 2 (two) shareholders' meetings: Extraordinary Meeting of Shareholders and the Annual General Meeting of Shareholders. On the 13th of May 2025, AS Silvano Fashion Group proposed to the shareholders to adopt the resolution of the extraordinary general meeting of shareholders stated below without convening the meeting according to § 2991 of the Commercial Code. On June 5, 2025 Silvano Fashion Group Extraordinary Meeting of Shareholders adopted the following decisions: To appoint the auditing company Ernst & Young Baltic AS (registry code 10877299, located at Rävala puiestee 4, 10143 Tallinn) as the auditor of AS Silvano Fashion Group; To authorize the Management Board of AS Silvano Fashion Group to enter into an audit service agreement with the auditing company AS Ernst & Young Baltic for auditing the economic activities of AS Silvano Fashion Group 2024. On the 11th of June 2025, AS Silvano Fashion Group proposed to the shareholders to adopt the resolutions of the annual general meeting of shareholders without convening the meeting according to § 299 1 of the Commercial Code. On July 03, 2025 Silvano Fashion Group held its regular Annual General Meeting of Shareholders. The Meeting adopted the following decisions: To approve the annual report of AS Silvano Fashion Group for 2024. To approve AS Silvano Fashion Group the net profit for the financial year 2024 of 12 366 000.- euros. Not to separate AS Silvano Fashion Group funds from the net profit of the financial year 2024 to the reserve capital of AS Silvano Fashion Group or other reserves prescribed by law or the articles of association. Leave the net profit undistributed and include the net profit of the financial year 2024 in the retained earnings. 3. To extend the term of office as members of the Supervisory Board for five (5) years until June 30, 2030 for Toomas Tool, Mari Tool, Triin Nellis, Risto Mägi, Stephan David Balkin. The decisions of the general meeting were published in the information system NASDAQ OMX Tallinn https://view.news.eu.nasdaq.com/view?id=b71bedbf06b01bcd5f45549c7044522b4〈=en&src=liste and on the website of AS Silvano Fashion Group https://www.silvanofashion.com/investors/company-announcements/ The resolutions of the general meetings were published on Nasdaq OMX Tallinn and Warsaw stock exchanges and on Parent company's website in Estonian and English language. Considering the aforementioned descriptions of general meetings held in 2025, the Group has largely complied with the CGR and GPW CGP in informing the shareholders, convening and holding the general meeting. Company has not complied the section 1.3.3 of the CGR issued by Financial Supervision Authority in Estonia: the Issuers shall make participation in the General Meeting possible by means of communication equipment (Internet) if the technical equipment is available and where doing so is not too cost prohibitive for the Issuer. Since AS Silvano Fashion Group does not have the required technical equipment, that would allow secure identification of shareholders, currently attendance and participation in general meetings is not possible by means of communication equipment. Conducting a general meeting using electronic communication means (real-life broadcast of the general meeting, real-time bilateral communication, exercise of the right to vote during a general meeting either in person or by proxy) is also recommendation of GPW CGP. Due to the reasons described above, the Group does not apply the said recommendation of GPW CGP. In addition, the abovementioned recommendation is not applied by the Group as its implementation would involve technical risks. Giving to the shareholders an option to communicate in the course of the general meeting without being present at the meeting, using electronic communication means, involves both technical and legal hazards for the proper and efficient conduct of the general meeting. In particular, the above brings about a real risk of technical interference preventing continuous bilateral communication with shareholders present in venues other that the meeting room. Therefore, the Group is unable to guarantee the reliability of technical infrastructure. At the same time, in the Group's opinion, the currently applicable rules for participation in general meetings facilitate the proper and effective exercise of rights attached to shares and sufficiently secure the interests of all shareholders. Furthermore, the Group has not been informed of any shareholders' expectations in respect of conducting the General Meeting of Shareholders using electronic communication means. The Group does not display on a corporate website an audio or video recording of a general meeting. Also, the Group does not provide real-time broadcasts of general meetings. In the Group's opinion, the manner in which general meetings have been documented so far ensures transparency of the Group's operations and safeguards the rights of all shareholders. In particular, the Group makes available the wording of resolutions adopted, in the form of current reports and website publications. Additionally, detailed data on voting results and objections, if any, raised against adopted resolutions are made available in the same form. Consequently, investors may obtain the knowledge of the material parts of, and matters discussed at, a general meeting. Management Board The Management Board is a governing body of AS Silvano Fashion Group that represents and directs the Parent company on a daily basis. In accordance with the articles of association, the Management Board may have one to three members. In accordance with the Commercial Code, members of the Management Board of AS Silvano Fashion Group are elected by the Supervisory Board. In order to elect a member of the Management Board, his or her consent is required. According to the articles of association of the Group, a member of the Management Board shall be elected for a specified term of up to three years. A member of the Management Board shall be removed from the Management Board by the Supervisory Board. The Supervisory Board may remove a member of the Management Board regardless of the reason. The member of the Management Board may resign from the Management Board regardless of the reason by giving the notice thereof to the Supervisory Board. As of 31 December 2025 the Management Board had 1 member: Mr. Jarek Särgava, although according to the clause 2.2.1 of the CGR, the Management Board shall have more than one member and a Chairman shall be elected by its members. All resolutions are adopted by the Management Board in collaboration with the Parent's company Supervisory Board. Under the direction of the Parent company, close cooperation is carried out with the management of subsidiaries and the people responsible for respective areas. The Group believes that such a division protects best the interests of all shareholders and ensures sustainability of the Group. In opinion of the Supervisory Board, the management of the Group is clearer and more transparent with one board member and so far the Supervisory Board has not considered election of additional board member to the Management Board to be necessary. Upon assuming the office, member of the Management Board has executed a board member contract with the Group or service contract with a company belonging to the Group governing the service assignments of that member. Those contracts specify the rights, obligations and liability of the member of the Management Board, and lay down the provisions governing payment of principal remuneration. The amount of the remuneration was agreed upon in line with the service assignments and activities entrusted to the relevant member of the Management Board, the current state of the business, and the future trends. A more detailed overview of the remuneration paid to the member of the Management Board is available in the Remuneration Report. Members of the Management Board have informed the Parent company of their participation in other business entities, which are not members of the Group or management bodies thereof. No members of the Management Board are in direct competition with the Group. There is no conflict of interest between the members of the Management Board and the Group and certain interest held by the members of Management Board, and their participation in managing bodies do not constitute a breach of the prohibition from competition. Moreover, the members of the Management Board have assumed the obligation to refrain from any breach of the non-competition obligation under their respective agreements. Furthermore, the internal work procedure rules of the Group stipulate that no member of the Management Board or any employee shall demand or accept in their own personal interest any money or other benefits from any third persons in connection with their job, nor grant any third persons unlawful or unreasonable favours. Supervisory Board The task of the Supervisory Board is to plan the operations of the Parent company, organize the business and carry out supervision over the activities of the Management Board. The General Meeting of Shareholders elects the members of the Supervisory Board of the Parent company. The Supervisory Board has three to five members according to the resolution of the general meeting and the member is elected for up to five years. The work of the Supervisory Board is organised by the Chairman of the Supervisory Board. The meetings of the Supervisory Board are held as necessary, but not less frequently than once every three months. As of 31 December 2025 the Supervisory Board of the Parent company consists of five members: Mr. Toomas Tool (Chairman), Mr. Stephan Balkin, Ms. Mari Tool, Mr. Risto Mägi and Ms. Triin Nellis. The current composition of the Supervisory Board is available on the Parent company's website. In accordance with Section 3.2.2. CGR more than one-half of the members of the Supervisory Board were independent. The Group is currently complying with the requirement of having at least half members of the Supervisory Board as independent members as set out in Section 3.2.2 of CGR. GPW CGP point 2.3. also requires that at least two members of the Supervisory Board meet the criteria of being independent and AS Silvano Fashion Group is in compliance with this requirement. The members of the Supervisory Board elect and appoint the chairman of the Supervisory Board. Mr. Toomas Tool serves as the chairman of the Supervisory Board from 15 November 2012. Based on CGR Section 3.2.5: "The amount of remuneration of a member of the Supervisory Board shall be published in the Corporate Governance Recommendations Report, indicating separately basic and additional payment (incl. compensation for termination of contract and other payable benefits)." The remuneration of the members of the Supervisory Board of AS Silvano Fashion Group has been approved by the resolution of the General Meeting of Shareholders dated 3 May 2019. This constitutes of EUR 2 000 as gross monthly remuneration for each Supervisory Board member and EUR 5 000 as gross monthly remuneration for the Chairman of the Supervisory Board. No severance pay is paid to resigning members of the Supervisory Board. Based on CGR Section.3.3.2: "All conflicts of interests that have arisen in preceding year shall be indicated in the Corporate Governance Recommendations Report along with their resolutions." The Management Board of the Parent company is not aware of any conflicts of interests between the Supervisory Board members and the Group. Altogether 6 meetings of the Supervisory Board were held in the reporting year. Most members of the Supervisory Board of the Group participated in more than one-half of the meetings of the Supervisory Board held during their term of office. Cooperation of Management Board and Supervisory Board The Management Board and the Supervisory Board work in close co-operation. The Management Board and the Supervisory Board hold joint meetings when matters concerning the Group's strategy are discussed, and the parties continuously exchange information pertaining to the strategic development of the Group. At such meetings the Management Board informs the Supervisory Board of any deviations from the Group's plans and targets and the reasons thereof. Meetings of the Chairman of the Supervisory Board and Management Board members are held to exchange information when needed. With respect to exchange of information, the internal rules governing the keeping, disclosure of internal information, as well as transactions with the shares of the Parent company are applied. The Management Board regularly informs the Supervisory board of the key circumstances regarding the activity plans and business activities of AS Silvano Fashion Group, the risks involved and management of such risks. No conflicts of interests occurred on financial year of 2025. Disclosure of Information Since listing of the shares of the Parent company on the Nasdaq OMX Tallinn Stock Exchange and the Warsaw Stock Exchange the Parent company has been adhering to the information disclosure requirements stipulated in the stock exchange to procure an equal treatment to the Parent company's shareholders. The website of the Parent company can be found at the address https://www.silvanofashion.com . The information targeted at shareholders is available at the easily found section http://www.silvanofashion.com/investors/ where the materials related to the General Meetings, including notices, agendas, resolutions, annual reports, information on the membership of the Supervisory Board and auditors and other materials related to the agenda items have been published. The materials are available in Estonian and English languages. The Parent company has disclosed on its website all the facts and assessment pertaining to the Group, which have been disclosed to financial analysts or other persons. The Parent company publishes all its announcements in Estonian and English languages on the Parent company's webpage and the webpage of the Nasdaq OMX Tallinn Stock Exchange and in English language on Warsaw stock exchange. Based on CGR Section 5.6: "The Issuer shall disclose the dates and places of meetings with analysts and presentations and press conferences organized for analysts, investors or institutional investors on its website." In accordance with the rules of the Nasdaq OMX Tallinn Stock Exchange, AS Silvano Fashion Group first discloses all material and price sensitive information through the stock exchange system. The information disseminated at meetings with analysts is limited to previously disclosed data. All information which has been made public, including presentations made at meetings, is available on the Group's website ( https://www.silvanofashion.com ), which lists the contacts of persons who can provide further information. Presenting a schedule of meetings on the corporate website is not currently relevant. As a rule, the issuer cannot enable other shareholders to attend the meetings held with institutional investors and analysts. To ensure the objectivity and unbiased nature of the meetings, institutional investors observe internal rules which do not allow third parties to attend such meetings. Audit committee AS Silvano Fashion Group has an audit committee, with rules of procedure approved by Supervisory Board. The audit committee is responsible for monitoring and analyzing the processing of financial information, the effectiveness of risk management and internal controls, and the external audit of the consolidated financial statements. The committee is also responsible for making recommendations in relation to the above issues to prevent or eliminate problems and inefficiencies. The audit committee reports to the Supervisory Board and its members are appointed and removed by the Supervisory Board. The committee has two to five members whose term of office is timeless. The members of the audit committee are not remunerated for serving on the committee. Members of the committee are Mr. Otto Tamme and Mr. Risto Mägi. Financial Reporting and Auditing It is the duty of the Management Board of AS Silvano Fashion Group to organise the internal control and risk management of the Group in a manner that ensures the accuracy of the published financial reports. The purpose of the internal control and risk management systems connected with the financial reporting process is to ensure harmonised and trustworthy reporting of the Group's financial performance in conformity with the applicable laws, regulations, adopted accounting policies and the reporting principles approved by the Group. The principles of risk management have been defined in the Group's risk management framework, which describes the activities for risk management relating to identification, assessment, prioritisation and mitigation of risks and the definitions, roles and areas of responsibility related to the field. In addition, the risk management and internal control activities are organised with the work organisation rules of the Group and its subsidiaries, which describe the functioning of various processes. The Group's financial area together with accounting and management reporting is the area of responsibility of the Group's chief financial officer (CFO) being responsible for the identification and assessment of risks in financial reporting, arranging the principles in relation to financial reporting of the Group. The financial reporting processes and systems are developed on a continuous basis. Risk analysis is conducted annually. This risk analysis serves as a basis for the further development of supervision and control measures and checkpoints in reporting to prevent the realisation of risks. The Management Board of AS Silvano Fashion Group publishes the annual report once each year and interim reports during the financial year. The annual report, which is signed by the members of the Management Board and Supervisory Board, is submitted to shareholders for examination. Consolidated Annual Report of the Group has been prepared in accordance with the International Financial Reporting Standards as adopted by the European Union. The auditor (Treetiger OÜ) is auditing this consolidated annual report of the Group for the first year. AS Silvano Fashion Group considers it important to ensure independence of the financial auditor and to avoid conflicts of interest. Auditor did not provide any services that are not permitted under Auditors Activities Act. In accordance with Section 6.2.1 of the EU Securities Regulation: "The remuneration that the Issuer has paid or will pay to the auditor must also be published." The fee for the audit of the Group's consolidated financial statements for the year ended 31 December 2025 is one hundred and six thousand euros, and the fee for the limited assurance engagement on the consolidated sustainability statement is twenty-seven thousand euros. Based on CGR Section 6.2.4: "Pursuant to the contract the auditor obliges to disclose to the Supervisory Board and at the General Meeting the facts, which become evident to them during the course of exercising of a regular audit, indicating noncompliance with the Corporate Governance Recommendations by the Management Board or the Supervisory Board. The Auditor shall prepare a memorandum to the Issuer regarding these facts along with the auditor's report. The auditor shall not reflect in the memorandum the facts that the Management Board has explained in the Corporate Governance Recommendations Report." The agreement entered into by an audit firm is governed by International Standards on Auditing, the Estonian Auditing Rules and the risk management policies of the audit firm that do not require the auditor to submit a memorandum on the issuer's non-compliance with the Corporate Governance Code. Accordingly, the agreement signed between AS Silvano Fashion Group and its audit firm does not include a corresponding article and the auditor does not submit such a memorandum. In our opinion, the financial audit conducted in respect of consolidated financial statements for the year ended 31 December 2025 has been in conformity with the regulatory provisions, international standards and the set expectations. Treetiger OÜ has introduced the results of the work during the interim audit and for the final audit before issuing the auditor's report. The independent auditor's report is presented on pages 84-89. ‌Corporate Social Responsibility AS Silvano Fashion Group has special responsibility towards society and the environment. Accordingly, in addition to economic growth, its corporate strategy and business operations are also oriented to ecological and social values. For the Group, this responsibility translates into numerous areas of involvement designed to promote the health and professional development of employees as well as activities to protect the environment and the ecosystem. Sustainable business AS Silvano Fashion Group continually works with its employees and business partners to ensure the sustained success of the Group. For this purpose, the business strategy focuses on the long-term enhancement of brand value, without neglecting the short-term requirements of the consumer and capital markets. Environmental responsibility and product sustainability AS Silvano Fashion Group acknowledges its responsibility for preserving environment for future generations, aims at improving living standards of both its employees and people living in the area of the Group's operations, seeks to enhance the quality of goods produced and thus commits to the following: Observe both national and international legislation on environment protection. Produce goods with maximum ecological efficiency, consume materials and energy resources efficiently. Reduce the level of environmental impact and waste products by improving current and adopting new resource saving, low waste or non-waste technologies. Constantly improve employees' knowledge on environment and ecology. Improve current environmental management system through its ongoing development and performance evaluation. Regularly inform the public and partners on the measures taken by management and employees to protect environment and increase ecological efficiency of production process. AS Silvano Fashion Group considers as an obligation to be able to provide products that not only satisfy the needs of its customers but also protect the environment. With this in mind, AS Silvano Fashion Group companies comply with internationally recognized production standards of Oeko-Tex, REACH, ISO, EAC and GOST R. This approach is valid both for raw materials and final products. The STANDARD 100 by OEKO-TEX® is a globally recognized certification system for raw, semi-finished, and finished textile products at all processing levels. It stands for customer confidence and high product safety. If a textile product has the STANDARD 100 label, the customer can be certain that every component of this product, i.e., every thread, button and other accessories, has been tested for harmful substances and that the article results to be harmless for human health. Oeko-Tex implies also a regular audit that is conducted once per three years. Oeko-Tex certified products automatically comply with REACH (Registration, Evaluation and Authorization of Chemicals) Regulation requirements. The Regulation has been adopted to improve the protection of human health and the environment from the risks that can be posed by chemicals, while enhancing the competitiveness of the EU chemicals industry. ISO standard is a universally accepted quality standard. ISO creates documents that provide requirements, specifications, guidelines or characteristics that can be used consistently to ensure that materials, products, processes and services are fit for their purpose. AS Silvano Fashion Group has following ISO standards in place: Quality management standards to help work more efficiently and reduce product failures; Environmental management standards to help reduce environmental impacts, reduce waste and be more sustainable; Health and safety standards to help reduce accidents in the workplace. CJSC Milavitsa certified the system of environmental management according to ISO 14000 already in 2003. Afterwards, in 2009 there was made certification according to ISO 14001 (version of 2005). In CJSC Milavitsa BS OHSAS 18001:2007 certification was made in 2006 - standard for occupational health and safety management systems. BS OHSAS 18001:2007 certification according to version of 2007, was made in 2009. In 2018, the labor protection and environmental management system was recertified for compliance with the requirements of BS OHSAS 18001 and ISO 14001 versions of the 2015 version. On June 6, 2018 TIC 15 104 151343 and TIC 15 116 12364 certificate were obtained for the compliance of the integrated system with the ISO 14001: 2015 and BS OHSAS 18001: 2007 standards. On July 13, 2021, CJSC Milavitsa received the ISO 14001 environmental management system certificate. Another subsidiary of AS Silvano Fashion Group - Lauma Lingerie obtained the ISO 14001:1996 environmental standard certificate and the ISO 9001:2000 quality management certificate already in 2003. EAC certificate is a conformity document required for import and sales of products in the countries of the Eurasian Customs Union. The EAC certifications are issued by independent certification bodies and their laboratories accredited by the relevant agencies of the members of the EAC Economic Union: Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. GOST certificates are a National Standard, in other words a document attesting that a product conforms to Russian Federation quality and safety requirements (GOST R, GOST EN, GOST R IEC, GOST R ISO, etc.). For AS Silvano Fashion Group these certificates are obligatory as they are required in order to import and sell products in the Russian Federation. In the specific markets the Group companies also have particular certificate requirements to comply with. Social responsibility and social initiatives AS Silvano Fashion Group acknowledges its responsibility for life and health of its employees as well as business partners, aims at improving safety and quality of working conditions and thus commits to the following: Observe both national and international legislation on labour rights protection. Guarantee safe working conditions to its employees: detect and analyse related risks on a regular basis; take all possible actions and allocate necessary funds to minimize negative impact of dangerous and harmful factors in the workplace. Constantly improve quality of working conditions and guarantee social support to the employees through the Program of Health Promotion. Take care of employees' health by preventing work-related diseases, providing medical support within the framework of the Program of Health Promotion. Use modern equipment and new technologies to ensure safe working conditions and high level of labour productivity. Ensure employees' satisfaction, motivation and dedication by investing in professional training and education. Carry out standardized employee performance reviews in all business areas in order to identify and promote personal development and career opportunities for each employee. Besides that, AS Silvano Fashion Group and its largest subsidiary CJSC Milavitsa are conscious of a certain responsibility for the general development of the region and well-being of the local community in Belarus, focusing mainly on children, youth and sportsmen by supporting their educational efforts, spending their leisure time in good surroundings and professional sport development. AS Silvano Fashion Group is convinced that support of local communities, promotion of healthy lifestyle are longterm positive contributions to healthy, economically active and environmentally conscious society. During 2025 AS Silvano Fashion Group has supported schools, centres for disabled people, nursing homes, charity organizations, colleges, youth sport clubs, trade union of industrial workers, etc. AS Silvano Fashion Group is also focused on employee wellbeing. This is why it organizes recreation and health improvement activities for employees' children in health camps, organizes cultural events for employees and their children, provides sponsorship and other social benefits. Complying with human rights AS Silvano Fashion Group confirms its continuing commitment to honour the UN Convention for the Protection of Human Rights and Fundamental Freedoms and contributes to ensuring the objectives of the declaration through complying with human rights and fundamental freedoms in all of its activities. Fighting corruption AS Silvano Fashion Group considers as corruption the abuse of power resulting from the official position for personal gain and admits that corruption jeopardises democracy and human rights, undermines good governance, social justice, damages the competitiveness and economic development of states, and endangers democratic institutions and the moral foundations of the society. Our main goal is to prevent corruption, however, we also pay considerable attention to the control of our activities. Major methods include avoiding conflict of interests, ensuring transparency, and increasing awareness within the Group. Main forms of corruption, the prevention of which is also in the focus of the Group, are: granting and accepting gratuities or bribes; abuse of official position or power; conflict of interests; nepotism; embezzlement; trading with know-how and inside information or using it for personal interests. In combating corruption, we proceed from the following principles: When communicating with the employees, the heads of the Group's companies draw their attention to the fact that no form of corruption is accepted in the Group and is in conflict with the ethical beliefs of the Group. We proceed from ethical, fair and transparent business and implement measures that contribute to it (such as rules, instructions, contracts, declarations, etc.). In our relationships with partners, we follow mutually and in every way the principles of preventing corruption. Upon the emergence of incidents of corruption, we forward the respective information to the police or prosecuting authority. Quality management A high quality business and management model is one of the assets of AS Silvano Fashion Group. The objective is to develop business processes, practices and systems based on the principles of continuous improvement and in accordance with the customers' needs and expectations. Quality development is a continuous process where every employee has a central role to play. The Group particularly emphasizes the handling of customer feedback so that the necessary information reaches the relevant employees with minimum delay and that corrective and preventive action can be effectively implemented. AS Silvano Fashion Group largest subsidiary - CJSC Milavitsa was the first Belarusian company who made the certification of its management systems already in 1996. I SO 9000 certification was made in 2003 according to the requirements of International quality standards. As requirements changed in 2009, CJSC Milavitsa made recertification according to ISO 9001. CJSC Milavitsa has been following the standard through the years. In 2018, the company successfully passed a certification audit for compliance with the requirements of STB ISO 9001-2015. On June 11, 2021 CJSC Milavitsa received the quality management system certificate ISO 9001, the date of initial certification was June 11, 2003. In 2024, the integrated occupational health and safety and environmental management system was certified for compliance with the requirements of STB ISO 45001-2020 and STB ISO 14001-2017 standards, and certificates BY/112 05.04.003.01 01194 (STB ISO 45001-2020) and BY/112 05.10.003.01 01195 (STB ISO 14001-2017) were received. ‌Consolidated Sustainability Statement GENERAL INFORMATION Basis for preparation According to the requirements of subsection 2 of § 24 of the Accounting Act of the Republic of Estonia, starting from 2025 (for FY 2025), AS Silvano Fashion Group is under the obligation to publish a sustainability statement in accordance with the European Sustainability Reporting Standards ( ESRS ) as stipulated by the Corporate Sustainability Reporting Directive (EU) 2022/2464 ( CSRD ). This sustainability statement has been prepared based on the aforementioned requirements on a consolidated basis. This is the Group's second sustainability statement. The scope of consolidation in the preparation of the sustainability statement was the same as for the financial statements. The sustainability statement only includes information about the Group and its subsidiaries. Circumstances related to upstream and downstream value chain have been taken into account only to the extent such information is available to the Group internally. No efforts have been made to obtain information from suppliers, customers, partners or other market participants for the preparation of the sustainability statement, regardless of their position in the value chain. Classified and sensitive information (including trade secrets), and information on intellectual property, know-how or results of innovation were omitted from the sustainability statement. In addition, in accordance with subsection 6 of § 24 of the Accounting Act of the Republic of Estonia, information about the expected developments of the Group or about matters under negotiation have been omitted from the sustainability statement if such omission does not prevent obtaining a fair and balanced view of the development, performance, position and impact of the activities of the Group and if, in the reasonable opinion of management, disclosure would be materially adverse to the business position of the Group. Governance Management and supervisory bodies The management bodies of the Group are the Management Board and the Supervisory Board, with the highest governing body being the general meeting of shareholders. The Management Board is responsible for and organizes the Group's daily operations and represents the Group in transactions and activities in accordance with the law and the Group's articles of association. The Supervisory Board is responsible for the strategic planning and management of the Group's activities, as well as overseeing the activities of the Management Board. The general meeting of shareholders constitutes a forum for the adoption of resolutions, through which the Group's shareholders exercise their fundamental shareholder rights. The Management Board is the management body of the Group that represents and directs the Group and manages its accounting. The Management Board has all the rights established in the relevant legislation, unless provided otherwise in the Group's articles of association. The Management Board of the Group has one member: Jarek Särgava. The members of the Management Board are elected and removed by the Group's Supervisory Board, and the election of a management board member requires their consent. When electing a member of the Management Board, the Supervisory Board proceeds from the competencies and skills of the candidate. Additional circumstances, such as the representation of different interest groups, sectors, genders, etc., are not considered. Under the direction of the Group, close cooperation is carried out with the managements of the Group's subsidiaries and the people responsible for specific areas. The Group believes that such collaboration ensures the sustainability of the Group. In the opinion of the Group's Supervisory Board, the management of the Group is clearer and more transparent with one board member, and so far, the Supervisory Board has not considered the election of additional board members to the Management Board necessary. The Management Board is required to act in the most economically purposeful manner for the Group in accordance with the Group's articles of association, the decisions of the Group's shareholders and the Supervisory Board, and applicable legislation. The Management Board must adhere to the lawful orders of the Supervisory Board in managing the Group. In accordance with applicable legislation, transactions which are beyond the scope of the Group's everyday economic activities may only be concluded by the Management Board with the prior written consent of the Supervisory Board. Such transactions include those listed in clause 6.7 of the Group's articles of association. The Supervisory Board is responsible for planning the operations of the Group, organizing the business and carrying out supervision over the activities of the Management Board. Members of the Group's Supervisory Board are elected by the general meeting of shareholders. The Supervisory Board can have 3 to 5 members, depending on the resolution of the general meeting, who are appointed for a term of up to 5 years. Shareholders may remove a member of the Supervisory Board regardless of the reason if at least 2/3 of the votes represented at the general meeting of shareholders are in favor. The work of the Supervisory Board is organized by the Chairman of the Supervisory Board. Meetings of the Supervisory Board are held when necessary. The competence of the Supervisory Board is defined by the articles of association and applicable legislation. Members of the Group's Supervisory Board are Toomas Tool (Chairman), Mari Tool, Risto Mägi, Stephan David Balkin and Triin Nellis. The Supervisory Board has 3 male and 2 female members. The Group has not established principles that would require additional circumstances, such as the representation of different interest groups, sectors, genders, etc., to be considered in addition to the skills and competencies of candidates when electing members of the Supervisory Board. The highest governing body of the Group is the general meeting of shareholders, the competence of which is defined in the Group's articles of association and applicable legislation. The annual general meeting of shareholders is held once a year, extraordinary general meetings may be convened as necessary. Meetings are convened and conducted in accordance with the articles of association and the requirements of the Commercial Code. Based on the provisions of the articles of association and the Commercial Code, resolutions of the shareholders may be adopted without convening a meeting. Each share grants one vote at the general meeting. The Group has only one class of shares and does not provide for any rights to shares of a different class which would bring about unequal treatment of shareholders in voting. A general meeting may adopt resolutions if over one-half of the votes represented by shares are present. A resolution of a general meeting is adopted if over one-half of the votes represented at the meeting are in favor unless a greater majority is required by law. A resolution on amendment of the articles of association is adopted if at least 2/3 of the votes represented at the general meeting are in favor. Resolutions of the general meetings are published on the Group's website and in the information system of Nasdaq Tallinn and, if necessary and possible, also the Warsaw Stock Exchange. The Group has not established any additional management principles beyond the articles of association, and there are no policies, internal procedures or other documents addressing sustainability matters. Members of the Group's management and supervisory bodies do not consciously engage in sustainability management or supervision at any level. Environmental, social and governance aspects are not considered in the Group's operations or decision-making processes. There are no processes in place for collecting and reporting information related to sustainability matters. The Group has not established principles or processes for integrating sustainability-related performance in its incentive schemes. The Group has not implemented a due diligence process to identify, prevent, mitigate and report its actual and potential negative impacts on the environment and its own workforce. The Group lacks any risk management or internal control systems related to the sustainability reporting process. Strategy and business model The Group's areas of activity, economic results, key investments and business environment have been described in the management report (pages 3 to 14). The Group will continue operating in its main areas of activity and markets. The Group's strategy does not cover sustainability matters and the Group does not separately consider environmental or social impacts in its planning and management activities. The Group acknowledges that certain management decisions and choices may have positive or negative impacts on sustainability-related areas, such as the environment, social aspects (people) and governance, but it does not measure such impacts, take them into account in shaping its strategies or business plans, nor has it established or plans to establish internal systems, processes or policies for measuring such impacts. The Group believes that even if there is a coincidental connection between sustainability matters and its strategy, business model or value chain, such a connection is minimal or insignificant. The key stakeholders, whose opinions the Group considers in developing its strategies, business and action plans, are the Group's shareholders. The interests of the Group's shareholders are mapped and taken into account in the form of a general meeting of the Group's shareholders. Important stakeholders also include the Group's customers, whose interests are mapped using a combination of various methods, including economic performance analysis. Mapping impacts and risks The Group has not conducted a process for identifying and assessing material impacts, risks and opportunities (IROs). Based on the Group's strategy and business model, it believes that identifying and assessing IROs is neither justified nor necessary. The Group has not established any policies or undertaken any activities related to sustainability matters, nor have they identified whether and which sustainability matters are relevant at the Group level, and the Group is therefore unable to disclose information on significant sustainability matters in accordance with the relevant standards. The Group has also no intention of establishing policies or systems for identifying and assessing IROs in the future. The Group does not measure performance or set targets in any of the sustainability areas described in ESRS standards (E1-E5, S1-S4, G1). The Group acknowledges that its activities may incidentally have a negative or positive impact in some of the areas described in the standards, but it does not measure or recognize IROs in any of the aforementioned categories, which is why the Group has refrained from describing separate standards in the preparation of this report for the sake of better readability. ENVIRONMENTAL INFORMATION Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation) - Taxonomy Report Article 8(1) of the Taxonomy Regulation obliges the Group to disclose information on how and to what extent their activities are associated with economic activities that qualify as environmentally sustainable under articles 3 and 9 of the Taxonomy Regulation. An economic activity qualifies as environmentally sustainable when it complies with technical screening criteria that have been established in Commission Delegated Regulation (EU) 2021/2139 ( Climate Delegated Act ) or Commission Delegated Regulation (EU) 2023/2486 ( Environmental Delegated Act ). The taxonomy report contains the key performance indicators related to the Group's consolidated turnover, capital expenditure and operating expenditure in accordance with the methodology to comply with the disclosure obligation set out in Commission Delegated Regulation (EU) 2021/2178 ( Disclosures Delegated Act ). The disclosed performance indicators include the proportion of Taxonomy non-eligible, Taxonomy-eligible and Taxonomy-aligned economic activities in revenue, capital expenditure and operating expenditure. Definitions An economic activity is classified as Taxonomy-eligible if it is described in the Climate Delegated Act or the Environmental Delegated Act, irrespective of whether that economic activity meets any or all of the technical screening criteria laid down in those delegated acts. An activity is Taxonomy-aligned if it meets the technical screening criteria laid down in the Climate Delegated Act or the Environmental Delegated Act and is carried out in compliance with the minimum safeguards laid down in Article 18 of the Taxonomy Regulation. Minimum safeguards are procedures implemented by an undertaking to ensure the alignment with the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights, including the principles and rights set out in the eight fundamental conventions identified in the Declaration of the International Labour Organisation on Fundamental Principles and Rights at Work and the International Bill of Human Rights. A taxonomy non-eligible economic activity is any activity that is not described in the Climate Delegated Act or the Environmental Delegated Act. Accounting policy and contextual information for key performance indicators Revenue The denominator includes the Group's revenue (as reported in the Annual Report on page 70) in accordance with the accounting policies set out in Note 2 to the consolidated financial statements. The Group analyzed its economic activities and sales in 2025, and concluded that all of the Group's revenue is related to Taxonomy non-eligible economic activities. Consequently, there is no revenue that could be included in the numerator for Taxonomy-eligible or Taxonomy-aligned activities. Capital expenditure The denominator includes additions to non-current assets during the reporting year before depreciation, amortization and any revaluations other than changes in fair value. The denominator includes the following additions set out in the notes to the consolidated financial statements: Note 13 - Intangible assets (page 63 of Annual Report), Note 14 - Investment property (page 64 of Annual Report), and Note 15 - Property, plant and equipment (page 65 of annual report) and Right-of-use assets (page 66 of Annual Report). The Group had no Taxonomy-aligned capital expenditure in 2025. The Group did not identify any capital expenditure in its economic activities in 2025 that would be related to Taxonomy-eligible activities. All of the Group's capital expenditure for 2025 is related to Taxonomy non-eligible economic activities. Consequently, there is no capital expenditure that could be included in the numerator for Taxonomy-eligible or Taxonomy-aligned activities. Operating expenditure The following non-capitalized costs have been included in the denominator in accordance with point 1.1.3.1 of Annex I to the Disclosures Delegated Act: Research and development Building renovation measures Short-term leases Maintenance and repair Any other direct expenditures relating to the day-to-day servicing of assets of property, plant and equipment by the Group or third party to whom activities are outsourced that are necessary to ensure the continued and effective functioning of such assets The Group incurred no operating expenditure in relation to Taxonomy-aligned or Taxonomy-eligible economic activities in 2025. All of the Group's operating expenditure for 2025 is related to Taxonomy non-eligible economic activities. Consequently, there is no operating expenditure that could be included in the numerator for Taxonomy-eligible or Taxonomy-aligned activities. Assessment of compliance with the Taxonomy Regulation In order to identify Taxonomy-eligible economic activities, the Group assessed the compliance of all group companies and activities with the descriptions of activities and NACE codes set out in the Climate Delegated Act and the Environmental Delegated Act. Although there is a high degree of overlap between the descriptions of activities related to climate change mitigation and adaptation objectives in the Climate Delegated Act, clause 18 of Commission Notice C/2023/305 stipulates that only activities carried out in accordance with an undertaking's climate change adaptation plan can be considered Taxonomy-eligible with respect to climate change adaptation. As the Group has not established a climate change adaptation plan, none of the Group's activities have been considered Taxonomy-eligible with respect to climate change adaptation. The Group has not identified any activities, costs or revenue components in its business operations that could be classified as relating to Taxonomy-aligned or Taxonomy-eligible economic activities. Minimum safeguards By implementing a due diligence process, the Group ensures the compliance of its activities with international guidelines and conventions regarding human rights, including the UN Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the ILO Declaration on Fundamental Principles and Rights at Work and fundamental conventions, as well as the UN Universal Declaration of Human Rights. Explanations to reporting templates There were no changes in accounting policies during the reporting period. The report forms have been submitted in accordance with the templates provided in the Disclosures Delegated Act. Cells not relevant for the Group are indicated in black. The Disclosures Delegated Act leaves it up to each reporting entity to decide whether to fill in columns 5-17 for Taxonomy-eligible but not Taxonomy-aligned activities. The Group has chosen not to fill these columns and make them black, indicating that they are not applicable. In addition, as the Group had no Taxonomy-aligned revenue or costs in 2025, columns 20 (Category (enabling activities)) and 21 (Category (transitional activities)), along with the corresponding rows, have been omitted from the table to simplify layout and make it more user-friendly. Proportion of turnover from products or services associated with Taxonomy-aligned economic activities - disclosure covering year 2025 Econo mic activiti es (1) Co de (2) Turnov er (3) Proporti on of turnove r, year N (4) Climate change mitigati on (5) Climate change adaptati on (6) Wat er (7) Polluti on (8) Circul ar econo my (9) Biodiver sity (10) Climate change mitigati on (11) Climate change adaptati on (12) Wat er (13) Polluti on (14) Circul ar econo my (15) Biodiver sity (16) Minimu m safegua rds (17) Proporti on of Taxono my-aligned turnover , year N (18) Proporti on of Taxono my-aligned turnover , year N-1 (19) €000 % % % % % % % Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % A. TAXONOMY-ELIGIBLE ACTIVITIES A.1. Environmentally sustainable activities (Taxonomy-aligned) Turnover of environment ally sustainable activities (Taxonomy-aligned) (A.1) 0 0% 0% 0% A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) Turnover of Taxonomy-eligible but not environment ally sustainable activities (not Taxonomy-aligned activities) (A.2) 0 0% 0% 0% A. Turnover of Taxonomy-eligible activities (A.1 + A.2) 0 0% 0% 0% B. TAXONOMY NON-ELIGIBLE ACTIVITIES Turnover of Taxonomy non-eligible activities 55 466 100% TOTAL 55 466 100 % Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities - disclosure covering year 2025 FY 2025 Year Substantial contribution criteria DNSH criteria (Does Not Significantly Harm) Econo mic activiti es (1) Code (2) Cap Ex (3) Proporti on of CapEx, year N (4) Climate change mitigati on (5) Climate change adaptati on (6) Wat er (7) Polluti on (8) Circul ar econo my (9) Biodiver sity (10) Climate change mitigati on (11) Climate change adaptati on (12) Wat er (13) Polluti on (14) Circul ar econo my (15) Biodiver sity (16) Minimu m safegua rds (17) Proporti on of Taxono my-aligned CaPex, year N (18) Proporti on of Taxono my-aligned CaPex, year N-1 (19) Text €000 % % % % % % % Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % A. TAXONOMY-ELIGIBLE ACTIVITIES A.1. Environmentally sustainable activities (Taxonomy-aligned) CapEx of environmentall y sustainable activities (Taxonomy-aligned) (A.1) 0 0% 0% 0% A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) CapEx of Taxonomy-eligible but not environmentall y sustainable activities (not Taxonomy-aligned activities) (A.2) 0 0% 0% 0% Translation of the Group's consolidated financial statements in PDF-format without European Single Electronic Format (ESEF) markups. The original document is submitted in machine-readable .xhtml format to the Nasdaq Tallinn Stock Exchange and digitally signed (link: https://nasdaqbaltic.com/statistics/en/instrument/EE3100001751/reports) .

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