FORTEC Elektronik : Financial report FY 2024/2025

About this update from Fortec Elektronik Ag

ANNUAL REPORT 2025 Annual Report 2025 Table of contents Preface 04 Group management report 07 Consolidated balance sheet 24 Consolidated statement of comprehensive income 26 Consolidated statement of changes in equity 27 Consolidated cash flow statement 28 Notes to the consolidated financial statements 29 Responsibility statement 86 Auditors' report 86 Preface Dear Sirs and Madams, dear shareholders, dear employees, The 2024/2025 financial year was once again marked by challenging macroeconomic developments, which had a noticeable impact on FORTEC. Geopolitical uncertainties, a stagnating economy, continued volatility in supply chains and new trade restrictions in the form of tariffs and sanctions led to generally subdued market and investment dynamics. Although various factors had a negative impact on FORTEC's business performance, consolidated revenue of EUR 79.7 million was achieved, which was close to the forecast of EUR 80.0 million to EUR 95.0 million adjusted in February 2025. Earnings before interest and taxes (EBIT) amounted to EUR 1.9 million, which was at the upper end of the forecast updated in July 2025 (EUR 1.0 million to EUR 2.0 million). The EBIT margin consequently fell to 2.3% in the reporting year, while consolidated net income declined proportionally to EUR 1.3 million. Earnings per share amounted to EUR 0.41. Nevertheless, FORTEC - which for over 40 years has been characterised by a business model that generates consistently positive earnings and a conservative financing policy - continues to have a very robust balance sheet structure. With an equity ratio of 76.6% (previous year: 73.3%), this underlines the company's financial stability and forms a reliable basis for its further development. In this context, the Management Board will propose a dividend distribution of EUR 0.40 per share (previous year: EUR 0.85 per share) at the upcoming Annual General Meeting on 11 February 2026, thus continuing its consistent distribution policy based on net income for the year. In addition to key performance indicators, the development of individual segments is of great importance to FORTEC. Business activities are divided into the segments of data visualisation and power supplies. The data visualisation segment generated sales revenues of EUR 46.8 million in the reporting year, compared with EUR 59.3 million in the previous year, while the power supplies segment once again made a virtually stable contribution to total sales with EUR 37.4 million, compared with EUR 39.8 million in the previous year. With its distribution, development, production and solutions divisions, FORTEC covers the entire spectrum from standard products to customer-specific solutions, making it a reliable partner for customers in the transport, industrial, medical technology, defence and security sectors. The order backlog as of 30 June 2025 was EUR 50.0 million, compared to EUR 53.4 million in the previous year, and has thus continued to normalise. Changes to the Executive Board and ensuring management continuity After the end of the financial year (30 June 2025), there were several significant developments that are of central importance for the future direction of FORTEC. On 6 October 2025, the Supervisory Board decided for good cause to revoke the appointment of Ms Sandra Maile as a member of the Executive Board and Chairwoman of the Executive Board with immediate effect. For personal reasons, I myself informed the Supervisory Board that I would not be available for another term of office and that I intend to resign from my position by 30 June 2026 at the latest. In order to ensure continuity in the management of the company, Mr Henrik Christiansen was appointed to provide interim support to the Executive Board from 10 November 2025 in consultation with the Supervisory Board. With over 30 years of experience in CFO and management positions, including at listed companies, as well as extensive expertise in controlling, accounting, M&A and digitalisation, he will strengthen the governance structures and operational capabilities of FORTEC during this transition period. At the same time, the Supervisory Board will use a structured process to identify suitable candidates who can further develop the FORTEC Group in a market-oriented manner with a clear strategy for the future and set a strategic perspective for the coming years. Significant acquisitions to strengthen market position The Group also continued to develop strategically after the balance sheet date. On 11 July 2025, FORTEC Elektronik AG acquired 100% of the shares in the Dutch company Nottrot B.V., thereby strengthening its data visualisation segment. This move not only expands FORTEC's product portfolio, but also gives it access to new customer segments in the maritime market, which has high barriers to entry, and in the defence sector. On 13 October 2025, FORTEC also acquired the remaining 63.3% of shares in Advantec Electronics B.V., which operates in the power supply segment, meaning that FORTEC now holds 100% of the shares. Both acquisitions strengthen FORTEC's presence in the Benelux region, open up additional market potential and create synergy effects that are expected to contribute to the Group's earnings power in the future. Outlook for the 2025/2026 financial year In view of the overall economic conditions and the associated uncertainties, FORTEC expects the 2025/2026 financial year to develop at the previous year's level with a slightly positive trend. Consolidated revenue is expected to range between EUR 80.0 million and EUR 85.0 million, with consolidated EBIT expected to be between EUR 0.9 million and EUR 2.1 million. This scenario assumes that the existing challenges will not increase further. FORTEC's 2025/2026 fiscal year will be marked by the appointment of new members to the Executive Board, the consistent implementation of the "Strong Together 2030" strategy, and the associated strengthening of market presence and sales development. The expansion of marketing and sales activities in the USA and targeted initiatives at FORTEC Integrated are intended to sustainably increase growth and sales potential in these core areas in particular. The "Strong Together 2030" strategy serves as a central guideline for all measures and supports the long-term stabilization and further development of the group of companies. The integration of the Dutch companies will also play a central role, making an important contribution to harmonising and strengthening our international positioning. At the same time, we are continuing to focus on increasing efficiency and profitability by systematically developing internal processes and strengthening the second management level in a targeted manner. Dear Shareholders, Your trust forms the basis for our long-term strategic orientation, especially in times of organisational change and macroeconomic uncertainty. The Executive Board and Supervisory Board work closely together to clearly define the priorities for FORTEC and shape its sustainable development. We would like to express our special thanks to our employees, whose commitment, expertise and flexibility contribute significantly to the continued success of FORTEC. Ulrich Ermel Management Board Annual Report 2025 Contents of the group management report Fundamentals of the Group 08 Control system 09 Research and development 09 Economic report 09 Business development and overall assessment 10 Profit situation 11 Asset situation 12 Financial and liquidity position 13 Forecast report 14 Risk and opportunity report 16 Further information in accordance with section 315a of the German Commercial Code 22 Group management report: 1. Fundamentals of the Group Over the past years, FORTEC as a group ("FORTEC Group") has gradually transformed itself from a product supplier to a system supplier of industrial high-tech products, and is now part of the international added value chain. Acting as a link between various production plants of internationally active suppliers, in particular from the Far East, as well as European and American customers, the FORTEC Group occupies an attractive growth niche and strives to constantly expand its position as a supplier of industrial solutions, for example through its own software and hardware developments, as well as the expansion of its own production services. Target customers are companies with long-term positioning, primarily in the high-growth areas of industrial automation, information technology and medical technology. Attractive niche markets such as railway & transportation and defence are also focal areas. The FORTEC Group's success is founded on a large number of long-standing customer relationships. The aim of our sales activities is to build strategic partnerships with top customers who are leaders in their own market sectors, as well as with customers with smaller and medium-sized order volumes. Due to ever-greater complexity, orders are increasingly commonly long-term projects and the companies of the FORTEC Group - as suppliers - are becoming long-term, strategic partners to their customers. In Germany, the group is represented by FORTEC Power GmbH in Riedstadt-Wolfskehlen ("FORTEC Power") and FORTEC Integrated GmbH in Germering ("FORTEC Integrated"). In Austria, the FORTEC Group is represented by a sales office and, in Switzerland, by its wholly-owned sales subsidiary FORTEC Switzerland AG ("FORTEC CH"). Furthermore, the group is represented in the Benelux states with a shareholding in the Dutch trading company Advantec Electronics B.V. in Prinsenbeek and through foreign subsidiaries: FORTEC Technology UK Ltd. in Huntingdon, England ("FORTEC UK"), FORTEC US Corp. in Ronkonkoma, USA ("FORTEC US") and FORTEC Czech Republic s.r.o. in Dýšina ("FORTEC CZ"), a subsidiary of AUTRONIC Steuer- und Regeltechnik GmbH, headquartered in Sachsenheim. Since 2024, the group has been supplemented by the newly-founded development location FORTEC Electronics Designs & Solutions Egypt SMLC in Giza, Egypt ("FORTEC EGY"). The FORTEC Group is one of the market leaders in German-speaking countries in the fields of data visualisation (display and embedded computer technology) and industrial power supplies by the Management Board's estimation. Furthermore, the FORTEC Group has established good positioning on the Anglo-American market with its subsidiaries. By linking the product areas of Display Technology and Embedded Computer Technology to form a data visualisation system, the FORTEC Group also offers complex solutions for an innovative market. The group's fields of competence range from the delivery of system-tested standard kits, to support services in the area of hardware and software for the sale of standard devices, for example, for professional display systems for industry or digital signage as well as complete monitors, right up to customer-specific developments and product solutions. The FORTEC Group's portfolio also includes TFT controller and drive solutions developed in-house, as well as the latest generation of optical bonding technology. In the product area of power supplies, the FORTEC Group covers the complete product range of power supplies and DC/DC converters, from standard products from the Far East, through series devices modified in Germany, right to customer-specific developments for niche markets realised by the subsidiary company AUTRONIC. Due to the high proportion of distribution in this segment, stock availability of the right products is the basis for success here. Group management report: 2. Control system As a group listed on the stock exchange, the FORTEC Group has well-established control systems that enable it to maintain a constant overview of important group activities. The Management Board monitors the group using key figures. The Supervisory Board in turn receives quarterly financial reports and monthly information on certain key figures. Furthermore, the board members maintain regular contact with the companies at local level. Reporting is performed by segments and, in some cases, across segments for simplicity. Such aspects as incoming orders, the contribution margin (CM I = gross margin), turnover and EBIT serve as relevant key performance indicators. The group considers turnover and group EBIT to be the most important financial performance indicators. Group management report: 3. Research and development The FORTEC Group is mainly active as a system provider in the data visualisation segment to provide its customers with added value and therefore differentiate them from the competition thanks to innovative applications and procedures. The group is therefore investing continuously and sustainable in its own development competence and maintains a development department with 27 (previous year: 26) employees and invests both in traditional product development (e.g. video converters and network IoT products) and in the further development of production technologies with an annual expenditure of around EUR 2.0 million (previous year: EUR 2.6 million). The focus in the data visualisation area in the 2024/2025 financial year was on renewing the product range due to further discontinuation of key components and required adjustments to our software due to updates to operating systems. Furthermore, training the new colleagues at the FORTEC EGY development location in Egypt was completed. The most important development work is still ongoing: Important software updates were already able to be released successfully, while the redesigns will probably take until the first half of 2026 before then being delivered to the first customers for evaluation. Thanks to staff reinforcements in Egypt, future-proof pre-developments were also able to be completed along with the required redesigns. Examples of this include the NFC board, the system management board and a new LED driver for lighting. Furthermore, a prototype of an in-house cloud application is in development. The proof-of-concept for an AI-based, fully-automated test device for in-house production is soon to be released. Group management report: 4. Economic report Macroeconomic and sector-specific framework conditions In the period from 01 July 2024 to 30 June 2025, the world economy continued to be characterised by challenging macroeconomic conditions. Geopolitical tensions in particular, continued high core inflation in many industrial countries and a restrictive fiscal policy in large economies such as the USA and parts of Europe had a dampening effect on the global economic situation. According to the expert advisory board, world economic growth over the course of 2024 was only just slightly below its longterm average. The decline in inflation in the large economies slowed down over the course of 2024. Group management report: 4. Economic report The expert advisory board expects a global gross domestic product (GDP) growth of around 2.6 % in 2024 and 2025. 1 The continued tension in the geopolitical environment, particularly the ongoing Ukraine war, new trade barriers and supply chain risks as a result of political tensions in the Asia-Pacific area remained a significant stress factor for the global economic investment and trade climate. In the euro zone , the economic situation at the start of 2025 was going slightly upwards, boosted mainly by exports to the USA, which were pulled forward. Consumer demand remained cautious despite beneficial conditions with low inflation, increasing real income and low unemployment. The European Central Bank decreased its base rates significantly up to the end of July. The threat of higher US tariffs on EU goods increased economic uncertainty and blocked investments. The ECB base rates fell from 4.25 % in June 2024 to 2.00 % in June 2025. 2 The German economy in the period from July 2024 to June 2025 was in a transitional phase from economic weakness to starting to recover. After two declining quarters in the second half of 2024, the first quarter of 2025 had surprisingly high growth of +0.4 % compared to the previous quarter. 3 At the same time, structural challenges remained: high labour costs, demographic change and sluggish digitisation and approval processes impaired long-term growth prospects. Group management report: 5. Business development and overall assessment In million EUR ACTUAL 2024/2025 Forecast 2024 management report Sales 79.7 95.0-110.0 EBIT 1.9 6.0-8.0 The FORTEC Group's business development in the 2024/2025 financial year was shaped significantly by the continuing inflationary effects with the associated weakened demand from customers, which was increased further by geopolitical uncertainties. In the last financial year, FORTEC achieved a group turnover of around EUR 79.7 million, which is around 16 % below the result of EUR 94.5 million in the previous year. The group EBIT (earnings before interest and taxes) at EUR 1.9 million (previous year: EUR 7.1 million) was around 73 % below the previous year's result. The group continued its strategy of ensuring supply chains, developing its IT infrastructure and reinforcing its uniform brand identity. The reason for change of plan regarding the financial performance indicators was mainly the declining sales volume in the data visualisation area (-21 %) due to further increased and noticeable reluctance on the part of customers. Higher costs, including due to volatile tariff policies and a decline in investment high-margin https://www.sachverstaendigenrat-wirtschaft.de/fileadmin/dateiablage/gutachten/jg202425/JG202425_Kapitel_1.pdf https://www.leitzinsen.info/eurozone.htm https://www.ifo.de/fakten/2025-06-12/ifo-konjunkturprognose-sommer-2025 project business affected profitability. However, the gross margin is within range and, considering the loss in sales only reduced disproportionately by 4.5 %. Therefore, the margin quality is relatively stable. Revenue in the power supplies segment, on the other hand, only reduced by 6 % due to defence orders. Other operating costs remained roughly constant, as the high currency losses contained therein (EUR 0.8 million higher than the previous year) and the savings measures also contained therein roughly compensated for each other, and personnel costs also only decreased slightly, as the group is maintaining a long-term personnel policy. In summary, FORTEC had to take a setback when it came to achieving its short-term financial goals in the financial year due to the challenging economic circumstances. The relatively strong gross margin development and the ongoing financial stability did offer a ray of hope. Group management report: 6. Profit situation Thanks to the restored delivery capability for preliminary products, the order backlog in the group fell to EUR 50.0 million at the end of the 2024/2025 financial year, and was therefore around 6 % lower than the previous year's value. Group turnover, a key financial performance indicator, was EUR 79.7 million in the 2024/2025 financial year (previous year: EUR 94.5 million). This corresponds to a decline of 16 % compared to the previous year. The reasons for the decline were mainly the reluctance to invest on the part of customers in the data visualisation segment. The power supplies segment only showed a slight decline of 6 % due to existing orders in the defence area. The inventory changes to the inventories of finished goods and work in progress caused an inventory increase of EUR 278 thousand due to the decline in demand. Other operating income increased from EUR 1.2 million in the previous year to EUR 2.0 million. The reasons for this include, on the one hand, various amounts of compensation for damages from business partners, increased profits from currency conversion differences of EUR 1.1 million compared to the previous year (previous year: EUR 0.8 million), as well as renegotiating a rental contract (EUR 0.2 million). The cost of materials decreased by 14 % to EUR 53.3 million (previous year: EUR 61.7 million). Taking into account the change in inventoriesoffinishedgoodsandworkinprogressinthe2024/2025 financial year, the gross margin ([revenue - cost of materials] / revenue) therefore decreased only slightly from 34.4 % in the previous year to 33.5 %. The cost of sales ratio therefore increased from 65.6 % in the 2023/2024 financial year to 66.5 % in the 2024/2025 financial year. Due to reduced bonuses and a headcount that reduced by seven employees, personnel costs reduced by EUR 0.7 million to EUR 15.9 million (previous year: EUR 16.6 million). Depreciation rose by EUR 0.7 million to EUR 2.4 million (previous year: EUR 1.7 million). The reason for the increase is an included goodwill reduction of EUR 0.7 million in the data visualisation segment due to short-term adjustments to business expectations. Other operating costs increased slightly by around EUR 0.1 million to EUR 8.5 million (previous year: EUR 8.4 million) and were 10.6 % relative to the reduced revenue (previous year: 8.9 %). The group achieved savings in this area, where expenses for IT services reduced from EUR 1.2 million to EUR 0.8 million, procured external services by EUR 0.1 million and insurance also reduced by EUR 0.1 million. However, these and further savings efforts were balanced out by the increase in currency losses of EUR 0.8 million so that other operating costs in the whole year increased by around EUR 0.1 million despite this. On balance (currency gains less currency losses), the profit and loss account includes a currency loss of EUR 512 thousand. The previous year resulted in currency gains of EUR 13 thousand. Group management report: 6. Profit situation Group EBIT, a key financial performance indicator, was EUR 1.9 million (previous year: EUR 7,1 million) due to the aforementioned factors. The group EBIT margin, based on sales revenues, therefore decreased from 7.5 % in the previous year to 2.3 % in the 2024/2025 financial year. Taxes on income and earnings decreased by 67 % to EUR 0.6 million (previous year: EUR 1.8 million). In contrast, the tax rate increased from 25.5 % to 32.3 %, which, as with the decline in EBIT, was mainly due to the reduced revenue and the corresponding reduction in tax offset possibilities. Furthermore, the goodwill impairment has no effect on taxes. The consolidated net income for the 2024/2025 financial year was EUR 1.3 million (previous year: EUR 5.3 million). The return on sales after taxes therefore decreased to 1.7 % (previous year: 5.6 %). Earnings per share decreased by around 75 % from EUR 1.63 to EUR 0.41. At the upcoming Annual General Meeting, the Management Board intends to propose dividend distribution of EUR 0.40 per share (previous year: EUR 0.85 per share). This corresponds to a dividend return of 2.5 % based on the share price (EUR 16.10) on 30 June 2025. Development of the segments The external revenues of the data visualisation segment made a contribution to Group turnover of EUR 44.1 million (previous year: EUR 56.7 million) and the power supplies segment EUR 35.6 million (previous year: EUR 37.8 million) to the group turnover. The ratio of the two segments therefore turned in favour of the power supply segment. The data visualisation segment contributed 55.4 % (previous year: 60.0 %) to the total turnover. The EBIT margin segment in relation to the total output of the data visualisation segment decreased from 6.0 % to 0.0 %, the return on sales in the power supply segment decreased from 7.5 % to 6.6 %. The decline was mainly due to volume. Due to the reduced demand for high-margin products, the ratio of revenue to cost of sales changed disproportionately, which is why the cost of sales ratio increased from 64.6 % in the previous year to 67.2 %. In the power supplies sector, turnover only decreased slightly and the cost of sales ratio was able to remain stable at 69.5 % (previous year: 70.0 %). However, due to increased other operational costs (IT project), the EBIT margin decreased from 7.5 % to 6.6 %. Group management report: 7. Asset situation On the assets side, with a balance sheet total of EUR 73.3 million (previous year: EUR 78.8 million), non-current assets amount to EUR 18.0 million (previous year: EUR 16.8 million). In accordance with IFRS 16, the largest item was recorded rights of use amounting to EUR 6.2 million (previous year: EUR 4.8 million) followed by goodwill from acquired subsidiaries at EUR 5.8 million (previous year: EUR 6.5 million). The increase in rights of use results from renegotiation of a long-term rental contract, while the decrease in goodwill is primarily due to an impairment in the data visualisation segment of EUR 0.7 million. The tangible assets mainly comprise one plot and a building from the power supply segment. The decline of EUR 387 thousand is mainly due to the ongoing, planned depreciation of the building. The increase in intangible assets to EUR 0.8 million (previous year: EUR 0.3 million) can mainly be traced back to activating IT projects (ERP system, FORTEC ONE website). Under current assets , with a value of EUR 21.2 million (previous year: EUR 22.3 million), the stocks standing at 28.6 % (previous year: 28.3 %) is one of the two largest single items of the balance sheet total. Of this amount, EUR 11.8 million (previous year: EUR 12.2 million) is attributable to the data visualisation segment, whilst the power supplies segment accounts for EUR 9.6 million (previous year: EUR 10.1 million). The decrease in inventory volumes reflects the normalising delivery availability of preliminary products and procurements that is adapted to the lower revenue. The receivables from deliveries and services decreased from EUR 14.8 million in the previous year to EUR 11.9 million due to decreasing revenue. The stock of instruments of payment, the second of the two largest items on the assets side, decreased from EUR 22.3 million in the previous year to EUR 19.2 million on 30 June 2025. The group's equity ratio increased to 76.6 % (previous year: 73.3 %). At EUR 56.1 million (previous year: EUR 57.8 million), the Group has sufficient equity. The equity capital increased by the consolidated net profit of EUR 1.3 million but was reduced by the dividend payment of EUR 2.8 million. On the liabilities side, non-current bank liabilities fell from EUR 0.9 million to EUR 0.6 million due to reclassifications in the area to the current liabilities to credit institutes. The current liabilities to credit institutes remained unchanged at EUR 333 thousand. Other current liabilities decreased slightly from EUR 1.6 million to EUR 1.5 million. Liabilities due to deliveries and services reduced to EUR 4.4 million (previous year: EUR 6.3 million). The significant decrease in tax liabilities from EUR 4.4 million to EUR 1.6 million is mainly due to the EUR 2.4 million decrease in liabilities for business tax due to the lower results and the payment of tax debts. Group management report: 8. Financial and liquidity position The goal of financial management is to safeguard corporate success against financial risks of any kind. The group pursues a conservative financing policy with the aim of securing its liquidity at all times. In doing so, the Group applies a steady and responsible dividend policy and utilises the freely available bank balances, which are intended to exceed the group's current liabilities. This ensures liquidity at all times. Furthermore, the group's objective is to sustain a strong capital base in order to maintain investor, market and creditor confidence. The objective of capital management is to ensure that business operations are based on a high level of equity financing. To control the capital structure, dividend payments can be adjusted, share buybacks can be implemented or new shares can be issued. The group monitors capital using a ratio of equity to net financial debt (equity / net financial debt) as the capital controlling indicator. The capital controlling indicator should be continuously higher than four. Net financial debt includes all debts according to the balance sheet less cash and cash equivalents. The equity capital corresponds to the equity capital shown in the balance sheet. In thousand EUR 30/06/2025 30/06/2024 Total balance sheet debts 17,152 21,041 Less cash and cash equivalents 19,203 22,259 Net financial debt 0 0 Equity capital 56,106 57,762 Capital controlling indicator - - Group management report: 8. Financial and liquidity position At the end of the 2024/2025 financial year, the FORTEC Group does not have any net financial debts, as the cash and cash equivalents exceed the total debts. Calculating the capital controlling indicator was therefore not required. The high stock of instruments of payment is mainly intended for acquisition objectives and is invested in interest-bearing day-to-day cash and restricted cash for up to six months as part of liquidity management. The FORTEC group defines the net financial assets as a further liquidity protection amount as the difference between the cash and cash equivalents, and the interest-bearing financial liabilities, of which the FORTEC group only counts the bank liabilities. The net financial assets defined in this way are therefore EUR 17.1 million (previous year: EUR 21.0 million). The cash flow from operations in the 2024/2025 financial year decreased from EUR 13.7 million in the previous year to EUR 1.9 million due to the lower consolidated net profit and higher taxes. The high operational cash flow in the previous year was due to a one-time special effect of warehouse normalisation (reduction) by around EUR 9 million in the previous year, which was not repeated in the current year. The cash flow from investing activities was EUR 0.7 million (previous year: EUR 0.5 million) and therefore almost unchanged. The cash outflow from financing activities was EUR 4.1 million after dividend distribution and regular repayments (previous year: EUR 4.2 million). In total, the group recorded cash and cash equivalents of EUR 19.2 million on 30 June 2025 (previous year: EUR 22.3 million). Investments In the past financial year, investments in intangible assets amounted to EUR 579 thousand (previous year: EUR 124 thousand), EUR 161 thousand in tangible assets (previous year: EUR 417 thousand), and rights of use including revaluation amounting to EUR 2,503 thousand (previous year: EUR 1,147 thousand), whereby investments in tangible assets were largely realised in operating and office equipment. In terms of rights of use, the decreases mainly resulted from a rental contract ending and being replaced by a new contract, and the low remaining term of the rental contracts. Non-financial reporting Non-financial performance indicators such as employee matters, long-term customer and supplier relationships, environmental issues and ISO certifications are also very important for the Group, although these are assigned a subordinate role in the management of the Group. With respect to employee matters, the average length of a FORTEC Group employee's time in service is over 10 years. The FORTEC group's stable business over decades is based on a long-lasting, close cooperation with selected suppliers. Many long-standing customers benefit from this, and the Group in turn owes its business success to these customers. The company is committed to ecological sustainability in its operational activities. For this reason, FORTEC is steadily expanding its sustainability report, which was prepared voluntarily for the first time in 2021/2022. The Group is certified in accordance with ISO 9001 and environmental management is already partially integrated into the management manual. The Management Board's variable remuneration also included qualitative goals that are published in the company's remuneration report. Group management report: 9. Forecast report The following statements regarding the future course of business and the assumptions of the economic development of the market and the industry are based on the assessments of the Management Board, which are currently considered realistic according to the information available. Various known and unknown risks, uncertainties and other factors may mean that the forecast developments do not actually come into being, either in terms of their tendency or their extent. Macroeconomic and sector-specific framework conditions According to the IFO 2025 summer forecast, a significant improvement in economic conditions is expected in the coming 2025/2026 financial year. After an expected GDP increase of 0.3 % in 2025, the institute is forecasting a growth of 1.5 % in 2026 4 . Therefore, the German economy would enter a moderate upturn after a phase of weak dynamics. 4 Early indicators also point to a recovery: the IFO Business Climate Index was at 88.4 points in June 2025 5 , which indicates a noticeable improvement to expectations compared to the previous year's value. According to an analysis by the European Parliamentary Research Service (EPRS, July 2025), the coming months will mainly be characterised by the "reciprocal tariffs" introduced by the USA. Depending on the degree of escalation, these tariffs could suppress the EU GDP by -0.2 % to -0.8 % and impair the capital markets due to higher import prices, exchange rate effects and increasing risk premiums 6 . The Centre for European Policy Studies (CEPS) also mentions the politico-economic dimension: the EU must safeguard industries and diversify supply chains. 7 Forecast group development In the 2025/2026 financial year, the management board is expecting an equally challenging environment in the data visualisation, embedded systems and power supplies segments. Success depends majorly on demand development and our customers' investment and product decisions from the industry, medical technology, transportation, security and defence sectors. While intensive price and competitive pressures, as well as some pushed back projects from customers will be noticeable, particularly in the data visualisation area, we are predicting stable demand for embedded solutions and power supplies due to increasing digitisation and current developments in the defence sector. However, at the same time, we can also expect cost increases. Material costs will probably be higher than in the previous year due to ongoing uncertainties with semiconductors, special components and preliminary products. Other operating costs will increase due to regulatory requirements, as well as due to additional marketing and logistics costs, including due to volatile tariff policies in international business. Under the aforementioned premises and the challenges outlined, the group expects development at the previous year's level with a slightly positive trend for revenue and EBIT in the 2025/2026 financial year in the basic scenario in both segments. Depending on the continued marketing development, a group turnover in a range of between EUR 80.0 million and EUR 85.0 million (2024/2025 financial year: EUR 79.7 million) and a Group EBIT of between EUR 0.9 million and EUR 2.1 million (2024/2025 financial year: EUR 1.9 million) are expected. General risk notice A forecast is subject to uncertainties that may have an impact on the development of results, which cannot be fully assessed at the current time. https://www.ifo.de/fakten/2025-06-12/ifo-konjunkturprognose-sommer-2025 https://www.ifo.de/fakten/2025-06-24/ifo-geschaeftsklimaindex-gestiegen-juni-2025 https://www.europarl.europa.eu/thinktank/en/document/ECTI_IDA %282025%29764382?utm https://www.ceps.eu/the-eu-us-trade-deal-promises-temporary-relief-but-longer-term-pain/? Group management report: 10. Risk and opportunity report Risk management Fundamentals of risk management Risk management is an ongoing task of identifying risks as possible negative developments and their effects on the Group at an early stage, evaluating them and implementing measures to deal with the risks accordingly. It is therefore necessary to create an awareness of the risks existing in the company among all employees and in particular among decision-makers. For this reason, corresponding processes and procedural instructions are integrated into the QMH process landscape and are permanently available to all employees; they are defined annually and their effectiveness is reviewed in internal audits. Employees are additionally sensitised in this regard through training. Risk management is an integral part of the management system and facilitates the identification of risks and the limiting of their effects insofar as possible. Risk identification At regular intervals, the FORTEC group carries out a risk survey through questionnaires and checklists. This results in a risk matrix (risk inventory) and is reported to the Management Board. This process ensures that both known and newly arising risks in the daily course of business are made transparent and therefore controllable. To this end, specifications are also devised for the subsidiaries. Risk description Determine the likelihood of occurrence Gross risk Create a mitigation plan Determine the success factor of the mitigation plan Net risk Risk assessment Risks are assessed and classified in terms of their probability of occurrence and their qualitative significance for the company, in order to establish transparency with regards to risk relevance for the group. The FORTEC Group draws up a quantitative assessment to facilitate even more precise evaluation of the risk-bearing capacity. The risk assessment is made up of the individual evaluations of the probability of occurrence and the potential gross amount of damage, which are reduced to a corresponding net risk through appropriate countermeasures. The criterion of probability of occurrence is divided into the categories "highly unlikely" (probability up to 10 %), "unlikely" (probability up to 25 %), "possible" (probability up to 50 %), "probable" (probability up to 75 %) and "highly probable" (probability up to 100 %). The potential gross loss amount is classified up to EUR 0.1 million ("minimal"), up to EUR 0.5 million ("minor"), up to EUR 1.0 million ("moderate"), up to EUR 5.0 million ("severe") and up to and greater than EUR 10.0 million ("threatening"). The final risk is divided into the categories "high risk" (net risk greater than EUR 1.0 million), "moderate risk" (net risk between EUR 0.5 million and EUR 1.0 million) and "low risk" (net risk less than EUR 0.5 million) Risk management measures Risk control can take place on the basis of the risk assessment. Appropriate risk measures have been implemented in accordance with the risk assessment carried out by the Management Board, and the individuals responsible for their implementation have been appointed. One of the aims of the risk management system is to ensure that risks are recognised by employees and decision-makers before they result in damage to the company and that those responsible reduce the risks in good time - either independently or in cooperation with the decision-makers - to a level that is acceptable to the FORTEC Group. Risk reporting Continuous risk reporting, in particular by the legally independent Group companies, ensures that the Management Board is able to regularly obtain an overall picture of the risk situation of the participations. The formal implementation of the risk management system helps in this regard. However, the FORTEC Group also focuses on ensuring that the employees are made permanently aware of potential risks, and that risks are recognised and dealt with promptly. Internal control and risk management with regard to the accounting process is an integral part of all processes of the FORTEC Group and is based on a systematic approach of risk identification, assessment and management that encompasses the entire Group. An internal control system supports the attainment of business policy objectives by ensuring the functionality and efficiency of business processes, compliance with laws and regulations, and the protection of business assets. The Management Board is responsible for the design of the control and risk management. Active monitoring controls by the board support the identification, assessment and handling of risks in the individual business areas of the AG and within the subsidiaries. The group has implemented a comprehensive QM management system for process organisation, which includes work instructions for the preparation of financial statements and other accounting-related activities that help to prevent errors. As part of the control and risk management from the participations, monthly evaluations of the segments facilitate the prompt identification of any deviations in the planned figures for incoming orders, the order inventory, stock on hand, as well as turnover, gross margin and costs, and the implementation of countermeasures if necessary. The maturity of receivables, in particular debtors, is reviewed regularly. The measures aimed at the correctness and reliability of accounting ensure that business transactions are recorded fully and promptly in accordance with the legal and statutory regulations, that inventories are carried out correctly, and that both assets and liabilities are accurately recognised, valued and reported in the annual financial statements. The processes serve to ensure that the accounting records provide reliable and comprehensible information. External consultants with appropriate expertise in accounting processes, such as auditors, accountants, as well as software providers, are included in the internal risk management. The group has implemented a comprehensive QM management system for process organisation, which includes work instructions for the preparation of financial statements and other accounting-related activities that help to prevent errors. As part of the control and risk management from the participations, monthly evaluations of the segments facilitate the prompt identification of any deviations in the planned figures for incoming orders, the order inventory, stock on hand, as well as turnover, gross margin and costs, and the implementation of countermeasures if necessary. The maturity of receivables, in particular debtors, is reviewed regularly. The measures aimed at the correctness and reliability of accounting ensure that business transactions are recorded fully and promptly in accordance with the legal and statutory regulations, that inventories are carried out correctly, and that both assets and liabilities are accurately recognised, valued and reported in the annual financial statements. The processes serve to ensure that the accounting records provide reliable and comprehensible information. External consultants with appropriate expertise in accounting processes, such as auditors, accountants, as well as software providers, are included in the internal risk management. Risk report The risks listed below - subdivided into risk categories - can affect the company as a whole (overall risk), the two segments, Group management report: 10. Risk and opportunity report the financial situation (financial risks) and the results (earnings-oriented risks). Further system-related risks are the personnel risk and technical risk. The Group is permanently exposed to the risks listed below. The principle insurable natural hazards are covered by a comprehensive insurance policy. This is reviewed annually, but may be insufficient in individual cases. For both segments, potential risks that the FORTEC Group must take in order to exist and survive in the market are the product risk, the risk of price changes and default risk, as well as the market risk and the dependence on upstream suppliers. Market price risks In times of high demand and product availability shortages, such as during the pandemic from 2020 to 2023 and due to the general increase in energy prices, the prices for purchased parts increased dynamically. A decrease in demand along with improved delivery capability is currently increasing the market risk, as price implementation becomes more difficult. Price change risks, which consist of a potential loss due to adverse changes in the market price or price-influencing parameters, are minimised through contract negotiations. Although the FORTEC group has always succeeded in managing this risk in the past, it is not possible to guarantee that market price risks will not result in future losses. However, this risk is currently classified as high. Procurement risks Inventory risks A significant earnings-oriented risk lies in the material planning of inventories. Incorrect scheduling can lead to considerable losses despite a multi-stage procurement process. However, the risk of having unsaleable goods in stock is not only based on an incorrect estimation of future demand, but also depends on a different perception of quality standards between customers and producers, in particular with respect to the quality of the goods (especially from the Asian region), and on EU directives and regulations regarding the constituents and use of the goods. Product liability is an ongoing risk for the FORTEC group, for example due to changes in purchasing rights (e.g. within the framework of Brexit). The risk is minimised through the careful selection of suppliers and the monitoring of assessments. However, in the event of deception and criminal acts on the part of upstream suppliers, Group companies are each liable to the customer as importers. Changes in suppliers Close cooperation with only a few strategic partners in the product area poses a major risk that is inherent in the system, which must not be underestimated. Success with Asian suppliers in particular is often based on a long-standing personal relationship between the decision-makers, in particular in the power supplies segment. As such, a change in personnel - be it due to the departure of the decision-maker(s) from the company or a change in the company's shareholder structure - can lead to the loss of existing business relationships. An expected concentration process on the supplier side could also have a negative effect on the company. In extreme cases, this could result in the termination of the supply relationship. The tensions between China and Taiwan currently pose a particular risk on the supplier side. Due to the current developments in the USA, there is a higher risk due to punitive tariffs. The company counteracts the risks by establishing alternative secondary suppliers in certain areas, adjusting the inventory and checking for alternative inventory flows. Availability of goods and procurement prices The market for power supplies and display technology is heavily dominated by the Far East. In times of high demand and product availability shortages due to limited capacities, this can lead to price effects (rising purchase prices), delivery delays and even to the non-delivery of products or, in the event of low demand and high delivery capability, to decreased purchase prices, meaning that a loss of sales or lower margins could arise in the worst case scenario. The group attempts to counteract this risk through a forward-looking procurement policy and back-up inventories. The procurement risk is assessed as high in general due to the cited risks. Risk reporting in relation to the use of financial instruments Default risks Default risk is the risk of financial loss if a customer or a contracting party to a financial instrument fails to meet their contractual obligations. A default risk generally arises from the group's receivables due to deliveries and services, debt securities held as financial investments and the bank balance. As a general rule, the Group checks the creditworthiness of the customer relationship with a trade credit insurer for all new customers and otherwise on an annual basis. Due to cancellations of the existing trade credit insurance of some customers by the insurers, they will be checked again (as is the general case for uninsured customers) and safeguarded either by bank guarantees, other hedges or increasingly by advance payment. In certain cases, FORTEC is also assuming a certain amount of risk itself. Accounts receivable are constantly monitored and known risks are reflected in value adjustments. The group's primary financial instruments include current and investment accounts, receivables due to deliveries and services and, on the liabilities side, bank loans and liabilities due to deliveries and services. To spread the risk associated with bank balances, the group relies on several bank accounts from reputable large institutes. The risk is currently classified as moderate. Liquidity risk To hedge the liquidity risk, a liquidity plan is prepared on a weekly basis and the value of receivables, especially debtors, is reviewed regularly. To further secure liquidity, the group has sufficient bank balances that exceed current liabilities from deliveries and services. Liabilities are paid within the agreed payment periods. Furthermore, the group has one long-term bank loan with favourable conditions from the management's perspective. Credit lines amounting to EUR 8.0 million have also been granted at group level, but these are not in use at the moment. The liquidity risk is currently classified as low. Legal and warranty risks A constantly increasing risk lies in customer requirements, which extend beyond the previous warranty period and the usual standard of a supply contract. In recent years, customers have gradually developed a sense of entitlement that is reinforced further in the currently challenging economic times and places a clear burden on the supplier. Claims arising from the supply contract can be considerably higher than the value of the goods. Legal disputes with corresponding risks are increasingly resulting from this. The former board member has taken legal action against his dismissal; based on legal advice, FORTEC believes it has a good chance of successfully defending itself against the lawsuit. The FORTEC Group has been able to manage the risks so far, but the risk is currently considered to be high. Personnel risks Success in the market remains heavily dependent on the comprehensive knowledge and long-term experience of the employees. Any large-scale change in personnel or individual key members of staff, as well as long-serving managing directors and members of the Management Board could jeopardise the success achieved so far. Through targeted representative regulations, comprehensive documentation and regular training, FORTEC ensures that short-term absences of individual employees can be compensated for at any time. The most important core tasks are therefore assured and business operations are not impaired. Hiring new employees against the background of a highly discernible shortage of skilled workers and enhancing attractiveness as an employer in a regional environment of full employment has presented a particular challenge. The risk is reduced through cooperation with external personnel service providers, active sourcing with the inclusion of social media, recruitment of employees abroad, relocation offers as well as a new, modern working environment and individual working Group management report: 10. Risk and opportunity report models. Furthermore, the FORTEC Group endeavours to secure and keep the expertise within the company through early succession planning for employees who are set to leave the company. FORTEC also provides targeted support for young people through the continuous training of young employees. Nevertheless, the risk is classified as high. Corporate strategy risks and competitive risks If the industrial customers of the FORTEC Group were to change their strategy and to cease production in Central Europe on a long-term basis and in doing so, rely on local suppliers, this would call the business model of FORTEC as a supplier of technically sophisticated products into question. A similar effect would arise in the event of a future change in the behaviour of the upstream suppliers of FORTEC, resulting in these suppliers realising sales directly to industrial customers via the internet and no longer selling their products exclusively through the established distribution channels. The same effect could occur if the trading margin to be achieved is below the costs incurred by the FORTEC Group due to the competitive information available to all customers via the Internet, which is mainly influenced by personnel expenses. Extensive production capacities, in particular in the data visualisation segment, increase the risk of not being able to react flexibly to market conditions, such as the current reluctance to invest on the part of customers, due to the fixed cost block. The risk is currently classified as high. IT risks / cyber risks A technical risk lies in the Group's entire IT network. Any possible failure or serious malfunction in the computer system could cause considerable damage to the FORTEC Group. Misuse by internal or external parties despite security precautions - in particular through theft of information or through inadequate data protection precautions - can endanger the company in extreme cases. This risk is minimised through the implementation of an internal MPLS network and the associated reduction of external interfaces, the ongoing training of employees, multi-factor authentication and cooperating with an external information security officer. Nevertheless, the risk is currently classified as high. Compliance risks As an international company that is oriented towards the capital market, the FORTEC Group operates in an environment of varied legal regulations. Numerous compliance laws and regulations, e.g. tax matters, as well as the ongoing changes to these regulations influence the company. Violations of these regulations, as well as the EU General Data Protection Regulation (GDPR), the supply chain due diligence law, the NIS2 directive and the regulations along with the corresponding reporting about the topic of sustainability can result in significant fines, additional costs and negative reports. Violations of applicable directives by employees of the FOTREC Group is a risk to which the company is exposed. The company faces these risks proactively by training employees, observing legislative changes precisely and ongoing consultation with lawyers and accountants, as well as other external partners. The former board member was dismissed due to, among other things, a compliance violation at a foreign subsidiary. The risk is therefore classified as moderate. Currency risks Foreign currency risks are avoided insofar as possible by conducting business in a single currency. Nevertheless, changes, in particular with regards to the US dollar and yen parity as well as fluctuations of the Swiss franc, the British pound and the Egyptian pound against the euro, dollar and yen, can have negative effects for the group. Currency risks can arise in particular as a result of the foreign activities, because currency fluctuations there directly influence the group's results. Based on ongoing monitoring, the risk is classified as moderate. Interest rate risks The FORTEC Group has significant cash and cash equivalents that earn interest, as the company invests its money for terms of up to 6 months. Therefore, an interest reduction to short-term interest would cause a decrease in interest income. The risk is currently classified as low, as interest income is currently of low importance in comparison to the remaining sources of income. The list of risks is not exhaustive; additional risks may arise that we are currently unaware of or do not consider significant. Summary risk assessment The overall risk position of the Group is operationally unchanged compared to the previous year. At the present time, it is not possible to definitively assess whether and what effects the war in Ukraine, the ongoing differences between the USA and China, the issues relating to Taiwan and current tariff developments could still have. At the present time, no risks are identifiable that could endanger the continued existence of the Group as a whole. In addition to the risks, the following opportunities, in the form of opportunity management, have been integrated into the management manual. This manual is updated annually as part of the management review, in order to continuously develop the Group. Opportunities report The FORTEC Group sees a number of opportunities to successfully develop the company in the coming years. The company philosophy "Big enough to compete, small enough to care" continues to create new opportunities compared to the previous year. New market opportunities are identified by the Management Board through targeted market observation, analysed and further developed together with the Supervisory Board within the framework of the strategic orientation. Outside the German-speaking region, we are seizing further market opportunities through subsidiaries in the United Kingdom, the USA and Egypt. The FORTEC group sees product opportunities from its own products and services in the area of controlling displays, touch solutions using the optical bonding procedure and high quality industrial monitors. As part of the digitisation trend and Industry 4.0., the external sales team or marketing are drawing up product ideas that are being coordinated with management and that are flowing into road maps and projects, which also tie up resources and pose risks. In the power supplies segment, the FORTEC group possesses expertise in application, problem solving and technical service. In the data visualisation segment (display and embedded computer technology), the company offers technology expertise for complete and tested subsystems, which contributes to growth. Further opportunities arise due to the consolidation of operational activities within the subsidiaries, which results in synergies in accordance with the "Grow Together 2025 Strategy". The "FORTEC One" project with the common brand identity implemented last year is an important milestone in merging together to become a global partner for unlimited technology solutions. Further measures for a successful future are anchored in the "Strong Together 2030 Strategy". With the newly-established FORTEC Electronic Design and Solutions development site in Cairo, Egypt, FORTEC is increasing its own development capacities to generate growth with new products and to inspire customers with the new possibilities. Although this cannot be guaranteed for the future, the FORTEC group is confident that the expanded mix of distribution, development,production&solutionsinbothsegmentsoffersgood opportunities for long-term, sustainable growth. The financial situation enables the group to respond with flexibility and speed to strategic options as they arise in the light of market and industry developments. Overall assessment of the risk and opportunity situation From the perspective of the management of a technology company, the opportunities for the future development of the FORTEC Group outweigh the risks. Despite increasing entrepreneurial risks, higher product requirements and shorter product lifecycles, the Group believes that the digitisation trend can have a positive effect on the market environment. Nonetheless, the worldwide crises could continue to have a negative impact on the Group's delivery capability and sales market. The Management Board is monitoring and analysing thedevelopments very closely. Group management report: 11. Further information in accordance with section 315a of the German Commercial Code The number of shares on 30 June 2025 stands at 3,250,436 with a nominal value of EUR 1.00 per share. There is currently neither conditional capital nor a share buyback programme. The subscribed capital consists exclusively of ordinary bearer shares with voting rights. There are no restrictions on voting rights, nor are there any restrictions on the transfer of shares. The AGM of 15 February 2023 authorised the Management Board, with the approval of the Supervisory Board, to increase the company's share capital by up to EUR 1,625,218 by issuing up to 1,625,218 no-par value bearer shares on one or more occasions against cash and/or non-cash contributions by 14 February 2028 (Authorised Capital I). The Management Board was also authorised, with the consent of the Supervisory Board, to exclude shareholders' subscription rights in the following cases: for fractional amounts; for capital increases against contributions in kind; in the case of cash contributions up to an amount not exceeding 10 percent of the share capital existing at the time this authorisation becomes effective or - if this value is lower - at the time this authorisation is exercised, provided that the issue price of the shares is not significantly lower than the stock exchange price of the already listed shares of FORTEC at the time the issue price is finally determined. The authorised capital on 15 February 2023 (Authorised Capital 2023/I) amounts to EUR 1,625,218 on the balance sheet date. The AGM of 07 February 2024 authorised the Management Board, with the approval of the Supervisory Board, to acquire the company's own shares by 06 February 2029 up to a total of 10 % of the company's existing share capital at the time of the date of resolution or, if this value is lower, at the time of exercising the authorisation. The shares acquired as part of this authorisation, together with the company's other shares that the company has already acquired and still owns or that are attributable to it in accordance with section 71a ff. of the German Stock Corporation Act (AktG) must never exceed 10 % of the relevant share capital. Appointment and dismissal of the Management Board take place in accordance with the statutory provisions (sections 84, 85 of the German Stock Corporation Act [AktG]). Compensation agreements in the event of a change of control or a takeover bid have been concluded with the Management Board. However, in the event of a change of control as a result of a takeover bid, the supplier contracts essential to the company may be terminated by the contractual suppliers. This danger exists in particular if the contractual supplier has reason to fear the entry of a competitor. Amendments to the articles of association require a majority of 75 % of the votes cast at the AGM. Further disclosures in accordance with section 315a, paragraph 1 no. 3 of the German Commercial Code are provided in the notes to the consolidated financial statements. Declaration on Corporate Governance in accordance with section 315d of the German Commercial Code According to section 315d HBG [Commercial Code], the company must submit a corporate governance statement for the Group. This declaration is made permanently accessible to the public on the Company's website at: https://www.fortecag.de/investor-relations/corporate-governance/ Final declaration on the report regarding relationships with affiliated companies (dependency report), section 312 paragraph 3 clause 3 of the Stock Corporation Act [AktG] The company has decided to draw up a dependency report once again. This is because the main shareholder with a minority shareholding usually represented a majority at the Annual General Meeting in the past two years, due to presence at the Annual General Meeting. This may give rise to a dependency relationship on the part of our company per section 17, paragraph 1 of the Stock Corporation Act. That said, the Management Board issues the following concluding statement: Our company did not have any reportable transactions in relation to the controlling company or one of its affiliated companies in the financial year. Germering, 17 November 2025 Ulrich Ermel Management Board Annual Report 2025 Consolidated balance sheet 24 Consolidated statement of comprehensive income 26 Consolidated statement of changes in equity 27 Consolidated cash flow statement 28 Consolidated balance sheet: 1. Assets In thousand EUR Annex Consolidated balance sheet 30/06/2025 Consolidated balance sheet 30/06/2024 A. Non-current assets I. Acquired goodwill 5 5,814 6,503 II. Intangible assets 6 801 331 III. Tangible fixed assets 6 4,105 4,492 IV. Rights of use 7 6,219 4,830 V. Financial assets balanced according to the equity method 8 91 84 VI. Financial assets 9 75 77 VII. Deferred tax assets 19 894 454 17,998 16,771 B. Current assets I. Inventories 10 21,246 22,290 II. Receivables from deliveries and services 11 11,921 14,795 III. Tax refund entitlements 11 2,129 2,100 IV. Other financial assets 11 303 236 V. Other assets 11 459 351 VI. Cash and cash equivalents 12 19,203 22,259 55,260 62,031 Total assets 73,258 78,802 Consolidated balance sheet: 2. Liabilities In thousand EUR Annex Consolidated Consolidated balance sheet balance sheet 30/06/2025 30/06/2024 A. Equity capital I. Subscribed capital 14 3,250 3,250 II. Capital reserve 14 14,481 14,481 III. Conversion adjustments 14/32 1,666 1,907 IV. Other reserves 14 35,365 32,813 V. Consolidated annual surplus 14 1,349 5,315 Equity of the owners of the parent company 56,112 57,766 Non-controlling interests -6 -5 Total equity capital 56,106 57,762 B. Non-current liabilities I. Non-current bank liabilities 15/18 611 944 II. Non-current leasing liabilities 18 5,368 3,973 III. Other non-current financial liabilities 18 98 87 IV. Other non-current liabilities 18 7 24 V. Non-current provisions 17 352 400 VI. Deferred tax liabilities 19 461 352 6,898 5,781 C. Current liabilities I. Liabilities to credit institutes 15/18 333 333 II. Liabilities from deliveries and services 18 4,398 6,321 III. Current leasing liabilities 18 922 1,040 IV. Tax liabilities 18 1,579 4,408 V. Other current financial liabilities 18 1,060 1,275 VI. Other current liabilities 18 1,463 1,595 VII. Provisions 17 498 287 10,254 15,260 Total liabilities 73,258 78,802 Consolidated statement of comprehensive income In thousand EUR Annex Group P&L 2024/2025 Group P&L 2023/2024 1. Sales revenues 21 79,717 94,529 2. Increased inventory of unfinished goods 22 278 -227 3. Other operating income 23 1,968 1,196 4. Cost of materials 24 -53,311 -61,744 5. Personnel expenses 25 -15,881 -16,566 6. Depreciation 26 -2,444 -1,739 7. Other operating costs 27 -8,470 -8,391 8. Operating result (EBIT) 1,856 7,058 9. Proportion of results from companies balanced according to the equity method 8 0 33 12. Other interest and similar income 29 273 149 13. Other interest and similar costs 29 -181 -134 14. Result before taxes 1,948 7,106 15. Taxes on income and earnings 30 -599 -1,803 16. Consolidated net profit for the period 1,348 5,303 17. Other earnings 32 -241 216 18. Total earnings 1,107 5,519 Attributable to: 19. Shareholders of the parent company 1,108 5.,530 20. Non-controlling shareholders -1 -2 21. Earnings per share (in euros) 0.41 1.63 22. Number of shares (in units) 3,250,436 3,250,436 Consolidated statement of changes in equity In thousand EUR Subscribed capital Capital reserve Currency conversion difference Other reserves Total Non-controlling interests Total equity capital As at 01/07/2023 3,250 14,481 1,691 35,576 54,999 6 55,005 Consolidated net profit for the period 01/07/2024- 5,315 5,315 -11 5,303 31/03/2024 Change in other earnings 216 216 216 Dividend payments -2,763 -2,763 -2,763 Changes from 01/07/2023-31/03/2024 216 2,552 2,767 -11 2,756 As at 31/03/2024 3,250 14,481 1,907 38,128 57,766 -5 57,762 As at 01/07/2023 3,250 14,481 1,907 38,128 57,766 -5 57,762 Consolidated annual surplus 01/07/2024-30/06/2025 1,349 1,349 -1 1,348 Change in other earnings -241 -241 -241 Dividend payments -2,763 -2,763 -2,763 Changes from 01/07/2024-30/06/2025 -241 -1,414 -1,655 -1 -1,656 As at 30/06/2025 3,250 14,481 1,666 36,714 56,112 -6 56,106 Consolidated cash flow statement In thousand EUR Annex 2023/2024 2023/2024 I. Operating activities 1. Consolidated net profit 1,348 5,303 2. (+) Income tax expenditure / (-) income tax refund 599 1,803 3. (+) Depreciation / impairment of value of tangible and intangible assets 2,444 1,739 4. (+) Other non-cash expenses / (-) other cash income -534 408 5. (+) Loss / (-) gain on sale of tangible assets -1 -13 6. (+) Decrease / (-) increase in inventories 1,098 10,143 7. (+) Decrease / (-) increase in receivables from deliveries and services and other receivables 2,541 -3,442 8. (-) Decrease / (+) increase in liabilities from deliveries and services -1,886 -231 9. (-) Decrease / (+) increase in current liabilities -447 -298 10. (+) Decrease / (-) increase in non-current receivables -516 -36 11. (-) Decrease / (+) increase in non-current liabilities 104 -417 12. (+) Interest expenses / (-) interest income -92 -15 13. (-) Interest paid 1 92 12 14. (+) Income tax refunded / (-) income tax paid -2,868 -1,208 Cash flow from operating activities 1,883 13,748 II. Investment activities 34 1. Payments for investments in tangible and intangible assets -730 -556 2. Proceeds from sale of tangible and intangible assets 12 16 Cash flow from investing activities -718 -540 III. Financing activities 34 1. Payments for the redemption of (financial) loans -333 -333 2. Payments for leasing liabilities 2) -1,021 -1,144 3. Profit distribution -2,763 -2,763 Cash flow from financing activities -4,117 -4,241 IV. Changes to cash and cash equivalents affecting payment 34 -2,952 8,968 Cash and cash equivalents at the start of the period 22,259 13,246 Effect of exchange rate changes on cash and cash equivalents -104 45 V. Cash and cash equivalents at the end of the period 19,203 22,259 Composition of cash and cash equivalents Cash 5 7 Bank balances 19,198 22,252 Cash and cash equivalents at the end of the period 13 19,203 22,259 The interest paid includes interest portion of lease liabilities The group has classified payments for the redemption component of the lease liability as financing activities, payments for the interest component as operating activities in accordance with the presentation of interest paid, and payments under short-term leases and payments for leases that are based on low-value assets as operating activities. Annual Report 2025 Contents of the notes to the consolidated financial statements General disclosures 30 Accounting and significant valuation principles 34 Scope of consolidation 44 Consolidation principles 46 Acquired goodwill 47 Intangible and tangible assets 49 Consolidated statement of changes 50 Leases 52 Financial assets balanced according to the equity method 53 Financial assets 54 Inventories 55 Receivables from deliveries and services, tax refund entitlements and other current assets 55 Cash and cash equivalents 56 Subscribed capital 57 Equity capital 57 Financial instruments - fair value 58 Financial risk management 61 Provisions 64 Liabilities 64 Deferred taxes 65 Other financial liabilities 66 Sales revenues 67 Change in inventories of unfinished/finished goods 68 Other operating income 68 Cost of materials 69 Personnel expenses 69 Depreciation 69 Other operating costs 70 Research and development costs 70 Interest result 70 Taxes on income and earnings 71 Segment reporting 72 Currency conversion 76 Notes to the cash flow statement 76 Capital management 77 Supervisory Board 78 Transactions with related companies and people 79 Remuneration of key management personnel 80 Auditor's fees 80 Other regulations according to stock corporation law 81 Other disclosures 82 Events following the balance sheet date 82 Release for publication 84 Notes to the consolidated financial statements: 1. General disclosures FORTEC Elektronik Aktiengesellschaft, Germering, Germany (hereinafter "FORTEC"), as the highest-level parent company in accordance with section 315e of the German Commercial Code, prepares consolidated financial statements in accordance with the provisions of the International Financial Reporting Standards (IFRS) of the International Accounting Standards Board (IASB), London, effective as on the balance sheet date, as well as the interpretations of the International Financial Reporting Interpretations Committee (IFRIC), as applicable in the European Union as of 30 June 2025. The basis for this is the obligation resulting from section 315e, paragraph 1 of the German Commercial Code in conjunction with Article 4 of Regulation (EC) No. 1606/2002 of the European Parliament and Council of 19 July 2002 concerning the application of international accounting standards. All standards whose application was mandatory as of the balance sheet date have been taken into account. Furthermore, all disclosures and explanations required by section 315e, paragraph 1 of the German Commercial Code, which are additionally required by German commercial law for consolidated financial statements to be prepared in accordance with IFRS, are published over and above the disclosure requirements under IFRS. The company's consolidated financial statements consist of the financial statements of the company and its subsidiaries (together referred to as the Group). In the power supplies segment, the Group offers the complete product range of power supplies and DC/DC converters. In the data visualisation segment with the product areas Display Technology and Embedded Computer Technology, the activities range from standard kits to complementary services and self-developed product solutions to complete industrial monitors. The business address of the parent company is Augsburger Str. 2b, 82110 Germering. The company is registered at the Munich district court under registration number HRB 247748. The consolidated financial statements of FORTEC have been rounded in euros, the functional currency; minor, insignificant rounding differences may therefore occur. Unless otherwise stated, all values are rounded up or down to the nearest thousand euros (EUR thousand). The consolidated statement of comprehensive income has been prepared using the nature of expense method. Where individual items on the consolidated balance sheet and the consolidated statement of comprehensive income have been combined for the sake of clarity, they are broken down and explained in the notes. The Group has prepared its financial statements on the assumption that it will be able to continue as a going concern. New accounting standards New and amended standards and interpretations IAS 8.28: The group has applied the following new and amended standards and interpretations, which are effective from 1 January 2024, for the first time in the past financial year: Classification of liabilities as short-term or long-term - amendments to IAS 1 and long-term liabilities with secondary conditions - amendments to IAS 1 The narrow amendment to IAS 1 clarifies that the classification of liabilities as short-term or long-term is based on the rights that apply at the end of the reporting period. The classification is independent of both management expectations and any events after the balance sheet date (e.g. receiving a waiver declaration or a breach of contract after the balance sheet date). The amendment also defines what is meant by "fulfilment" (settlement) of a liability in IAS 1 Supplier financing agreements, amendments to IAS 7 and IFRS 7 The aim of the new disclosure is to provide information about supplier financing agreements that enable investors to appraise the effects on liabilities, cash flows and the liquidity risk of a company. The new disclosures comprise information regarding

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