Financial statements as of 31 december 2025

Corporate Bodies 3

Notice of Ordinary Shareholders' Meeting 4

Report on Operations for the year 2025 5

Consolidated Financial Statements of the IRCE Group as at 31 December 2025 69

Consolidated Statement of Financial position 71

Consolidated Income Statement 73

Consolidated Statement of Comprehensive Income 74

Consolidated Statement of Changes in Equity 75

Consolidated Statement of Cash Flows 76

Accounting Standards and Explanatory Notes to the Consolidated Financial Statements 77

Annex 1- List of equity investments held by directors, statutory auditors, spouses (unless separated) and minor children pursuant to Article 84-bis of the Consob Regulations 122

Annex 2 - Certification of the annual consolidated financial statements pursuant to Article 154-bis, paragraph 5, of Italian Legislative Decree 58/1998 123

Annex 3 - Certification of the sustainability report pursuant to Article 81-ter(1) of Consob Regulation No. 11971 of 14 May 1999, as amended and supplemented 124

IRCE S.p.A.'s Separate Financial Statements as at 31 December 2025 ............................................................ Statement of Financial Position 126

Income Statement 128

Statement of Comprehensive Income 129

Statement of Changes in Equity 130

Statement of Cash Flows 131

Accounting Standards and Explanatory Notes to the Separate Financial Statements 132

Annex 1 - Certification of the annual separate financial statements of IRCE S.p.A. pursuant to Article 154-bis, paragraph 5, of Italian Legislative Decree 58/1998 175

Annex 2 - List of Equity Investments in Direct Subsidiaries 176

Report of the Independent Auditors on the Consolidated Non-Financial Statements Report of the Independent Auditors on the Consolidated Financial Statements Report of the Independent Auditors on the Separate Financial Statements

Report of the Board of Statutory Auditors on the Separate Financial Statements

Board of Directors

Chairman Mr Filippo Casadio

Executive Director Mr Francesco Gandolfi Colleoni

Executive Director Ms

Non-Executive Director Mr

Elena Casadio Gianfranco Sepriano

Non-Executive Director Ms Francesca Pischedda

Non-Executive Director Mr Orfeo Dallago

Independent Director Ms Marianna Fabbri

Independent Director Ms Carlotta Armuzzi

Chairman Ms Donatella Vitanza

Standing Statutory Auditor Mr Fabrizio Zappi

Standing Statutory Auditor Mr Giuseppe Di Rocco

Alternate Statutory Auditor Mr Federico Polini

Alternate Statutory Auditor Ms Debora Frezzini

Independent Auditors

Deloitte & Touche S.p.A.

Components Control and

Risks Committee

Remuneration Committee Related Parties Committee

Ms Marianna Fabbri ■ ■ ■

Ms Carlotta Armuzzi ■ ■ ■

Mr Orfeo Dallago ■

Mr Gianfranco Sepriano ■

Ms Francesca Pischedda ■

Mr Massimiliano Bacchini

Internal Auditor

Mr Fabrizio Bianchimani

Supervisory Board

Mr Francesco Bassi Mr Gabriele Fanti

Mr Gianluca Piffanelli

Our shareholders are called to participate to an Ordinary Shareholder's Meeting to be held at the Registered Office on 30th April 2026 at 11,00 am in a first call and on the second call, if necessary, on 4th May 2026 at the same time to discuss and vote the following

• Financial statements as of 31/12/2025 and relative reports of the Board of Directors and Board of Auditors; related and resulting resolutions;

• Allocation of the profit of the period 2025;

• Presentation of the consolidated Group financial statements as of 31/12/2025;

• Election of the Board of Auditors and its President for the year 2026-2027-2028;

• Determination of the annual remuneration for the members of the Board of Auditors;

• Proposal of authorization to the purchase and hold of own shares, how to purchase and to sale;

• Report on remuneration, examination of Section I (i.e. remuneration policy) resolution pursuant to Article 123-ter, paragraph 3 bis, of Legislative Decree 24/02/98 no. 58;

• Report on remuneration, examination of Section II (i.e. remuneration paid in the year) resolution pursuant to Article 123-ter, paragraph 6, of Legislative Decree 24/02/98 no. 58.

The company's share capital stands at 14,626,560 euros and is divided into 28,128,000 ordinary shares. Each ordinary share represents one vote in the General and Extraordinary Shareholders' Meetings. At today's date the Company holds 1.711.600 of its own shares representing 6,09% of the total share capital, whose voting rights are suspended pursuant to article 2357 ter of the Italian civil code.

Pursuant to article 83-sexies of Legislative Decree 58/1998 the right to participate in the Meeting and to exercise voting rights is conditional upon the Company receiving notice of the subject's right to vote by an intermediary. This must be in conformity with the intermediary's accounting records and balances recorded at the end of the seventh trading day prior to the date established for the first call of the Meeting by 21th April 2026; credit or debit recordings made to the account after the said term do not influence the right to exercise a vote in the Meeting. Those who become shareholders in the Company after this date will not have the right to participate and to vote in the Meeting. The company must receive the above-mentioned notice sent by the intermediary by the end of the third trading day prior to the date set for the Shareholders' Meeting on first call 27th April 2026. The right to participate and vote stands if notice is received by the Company after the aforesaid term, provided that it arrives by the time the Meeting begins on first call.

Each Shareholder may appoint a representative, according to the applicable laws, by undersigning the proxy form, released on request by those who have the right through enabled intermediaries, or it can be downloaded from the website https://www.irce.it. The proxy may also be sent to the Registered office by registered letter with return receipt or sent by certified e-mail to the following address: ircespa-pec@legalmail.it. A copy of a currently valid identification card of the shareholder must be attached.

For the Shareholders' Meeting referred to in this notice, the Company has therefore appointed the Lawyer Stefania Salvini as Designated Representative, pursuant to art. 135-undecies of Legislative Decree 58/1998 (TUF).

The proxy can be granted to the lawyer Stefania Salvini by registered mail with return receipt at Via Tinti 16, 40026 Imola (BO), or by certified e-mail message to the address avvstefaniasalvini@ordineavvocatibopec.it. The Company prepares a specific form which will be made available on the company's website https://www.irce.it. The proxy to the designated representative must contain voting instructions on all or some of the proposals on the agenda and must reach the aforementioned Representative by the second open market day preceding the date of the Shareholders' Meeting on first call by 28th April 2026. Within the aforementioned term, the proxy and the voting instructions can always be revoked in the same way as for the assignment. The proxy has effect only for proposals in relation to which voting instructions have been given.

The Shareholders, who, even together, represent at least 2.5% of the share capital, are entitled to present lists to elect the External Auditors. The lists must be delivered directly to the Registered office or sent by registered mail with return receipt or by certified e-mail

addressed to ircespa-pec@legalmail.it, along with a currently valid identification document of the shareholder delegating the proxy, at least 25 days prior to the date of the first call for the Meeting by 5th April 2026 The lists must include information on the identity of the Shareholders presenting them, with the indication of the overall percentage of share capital held; a declaration of the shareholders other than those who hold, even jointly, a controlling or relative-majority equity interest, certifying the absence of relations of connection as defined by article 144-quinquies of the Issuer's Regulations with such shareholders; a complete report on the personal and professional characteristics of the candidates; a declaration of such candidates, certifying the possession of the requisites prescribed by the applicable laws; and their acceptance of the nominations

Shareholders entitled to attend the Shareholders' Meeting may submit questions on the items on the agenda even before the Shareholders' Meeting sending by the seventh trading day before the Shareholders' Meeting by 2th1 April 2026 by registered mail with return receipt at the registered office of the Company or sent by certified e-mail to the following address ircespa-pec@legalmail.it. They will be answered at the latest by the third trading day before the date of the Shareholders' Meeting by 27 April 2026 by publication on the https://www.irce.it website.

Shareholders who, even jointly, represent at least one fortieth of the share capital may request in writing, within 10 days of the publication of this notice by 29 March 2026 and in compliance with the provisions of Article 126-bis of Legislative Decree 58/1998 (TUF), the integration of the agenda's items indicating in the request the additional topics proposed or submitting proposals for resolutions on items already on the agenda. The requests, together with the certification certifying the ownership of the shares are sent by registered mail with return receipt at the registered office of the Company or by certified e-mail message to the address ircespa-pec@legalmail.it. Within this period and in the same way it must be delivered to the Board of Directors of the Company a report that contains the motivation of the resolution proposals on the new matters or the motivation related to the new resolution proposals. Notice of integration to the agenda or presentation of further resolution proposals on items already on the agenda shall be given in the same form as required for the publication of the notice of the general meeting, at least 15 days before the date of shareholders' meeting on first call by 15th April 2026.

The additional resolution proposals on items already on the agenda, as well as the aforementioned explanatory reports (accompanied by any assessments by the Board of Directors) will be made available by the Company at the Company's registered office and on the website at the same time as the publication of the presentation notice.

Pursuant to the provisions of Article 126-bis, paragraph 3, of the TUF, the integration of the agenda by the Shareholders is not allowed for the topics on which the Shareholders' Meeting is called to resolve on the proposal of the Directors or on the basis of a project prepared by them.

Documents relating to the Meeting will be made available at the Registered office, at the Borsa Italiana SpA (Italian Stock Market) and on the website https://www.irce.it, within the terms set by the applicable laws. The shareholders have the right to obtain a copy of the deposited documentation.

Any changes and / or additions to the information contained in the notice of meeting will be made available via company website https://www.irce.it and in the other ways provided for by law.

Report on Operations for the year 2025

Given the significant impact of the activities of the Parent Company IRCE S.p.A. (hereinafter also referred to as "IRCE", the "Company", the "Parent Company") within the IRCE Group and pursuant to article 40, paragraph 2 bis of Italian Legislative Decree No. 127/1991, this Report on Operations is drafted jointly for the separate financial statements of IRCE S.p.A. and the consolidated financial statements of the IRCE Group.

Dear Shareholders,

In 2025, the economic scenario was, as in the previous reporting period, far from favourable. The Group's main target sectors continued to experience a period of weakness, and the recovery in demand hoped for at the start of the year failed to materialise.

The global economic landscape has remained, and continues to be, heavily influenced by protectionist policies, armed conflicts and geopolitical tensions, with inevitable repercussions on industrial activity and a high level of uncertainty. Added to this was the slowdown in electric mobility and a gradual shift in European focus from the energy transition to safeguarding industrial competitiveness, with a more cautious review of decarbonisation targets in the short term.

In this complex framework, the Group has focussed on production efficiency, strengthening commercial activities and advancing medium-to long-term strategic projects. The Brazilian company's results were good; the new plant in the Czech Republic has commenced production, while in China the construction of the plants and the installation of some machinery will be completed by the end of the year; finally, we have closed down operations at the plant in the Netherlands.

Against this backdrop of market conditions and strategic actions, the consolidated result for the financial year closed with a net profit of

€6.18 million.

Consolidated turnover amounted to €377.64 million, down 5.0% from €397.65 million in 2024. The decline was mainly due to lower sales volumes, partly attributable to the closure of the subsidiary Smit Draad in May 2025, and only partially offset by the rise in copper prices. The average LME price in euros for 2025 was 4.1% higher than in the previous year.

Throughout the year, market demand for both of the Group's business lines remained weak, leading to a gradual decline in volumes and a fairly negative fourth quarter. In the winding conductors segment, the decline in sales reflected the difficulties faced by the main end-user markets, namely household appliance and automotive manufacturers. The cables segment also contracted, affected by the slowdown in traditional markets such as construction and industry.

Consolidated turnover without metal1decreased by 10.5%; the winding wire sector fell by 7.4%, and the cable sector decreased by 18.0%.

In detail:

1Turnover or revenues without metal corresponds to overall turnover after deducting the metal component.

The following table shows the changes in results compared to the previous year, including adjusted EBITDA and EBIT.

The net financial position at 31 December 2025 amounted to €67,60 million, an increase compared to €46.51 million as at 31 December 2024, mainly due to the investment made in the reporting period and to a lower extent to the growth in working capital.

The Group's investments in 2025 amounted to €19.58 million and mainly related to the purchase of production lines by the subsidiary Irce Ltda, the completion of the construction of the building, the purchase of production lines by Irce Sro, and the construction of the industrial plant in China, which was completed in early 2026.

2 The item "Turnover" consists in the "Revenues" as recognised in the income statement.

3 Turnover without metal corresponds to overall turnover after deducting the metal component.

4 EBITDA is a performance indicator the Group's Management uses to assess the operating performance of the company and is not an IFRS measure; it is calculated by adding depreciation/amortisation, provisions and write-downs to EBIT.

5 Adjusted EBITDA and EBIT are calculated as the sum of EBITDA and EBIT and the gains/losses on copper and electricity derivatives transactions realized (€ +0,92 million in 2025 and € +0.48 million in 2024). These are indicators the Group's Management uses to monitor and assess its own operating performance and are not IFRS measures. Given that the composition of these measures is not regulated by the reference accounting standards, the criterion used by the Group may not be consistent with that adopted by others and is therefore not comparable.

6 Net invested capital is the sum of net working capital, fixed assets, other receivables, net respectively of other payables, provisions for risks and charges and provisions for employee benefits.

7 The means of measuring the net financial position conform to CONSOB Warning notice 5/21 of 29 April 2021, which transposes the ESMA Guideline of 4 March 2021.

Below is a summary of the performance of IRCE S.p.A.'s shares, listed on Borsa Italiana's Mercato Telematico Azionario - STAR segment.

The Group's main risks and uncertainties, as well as risk management policies, are detailed below.

Market risk

The Group is mainly focused on the European market; the risk of contractions in demand or of worsening of the competitive scenario may impact the results. To address these risks, the Group's medium to long-term strategy provides for a geographic diversification in non-EU countries.

Risk associated with changes in financial and economic variables

• Exchange rate risk

  The Group primarily uses the Euro as the reference currency for its sales transactions. It is exposed to exchange rate risks mainly in relation to its copper purchases, which it partly carries out in dollars; it may hedge such transactions using forward contracts. It is also exposed to foreign currency translation risks for its investments in Brazil, the UK, India, Switzerland, Poland, China, and Czech Republic.

  As for the foreign currency translation risk of subsidiaries, the Group believes this risk mainly concerns the investment in Brazil due to the high volatility of Brazilian Real, which affects the carrying amount of the investment. At 31 December 2025, the euro/real exchange rate stood at 6.45, in line with the rate of 6.41 recorded at 31 December 2024.

• Interest rate risk

The Group financed its business in the medium/long term by borrowing at a variable interest rate (connected to the Euribor), thus exposing itself to interest rate risks. The Group will assess whether to make hedges on the basis of the terms and conditions offered by the market and the expected trend in interest rates.

Short-term lines of credit are always at variable rates.

• Risk related to fluctuation in the price of copper

  The main raw material used by the Group is copper. The changes in its price can affect margins as well as financial requirements. In order to mitigate the potential impact of changes in the price of copper on margins, the Group implements a hedging policy using forward contracts on the positions generated by operating activities. However, given falling copper prices, the risk remains of having

  to measure the final inventories at their expected realisable value, should it be below the average weighted cost for the period, with a negative impact on the result. The average price of copper in 2025 on the London Metal Exchange was 8.80 €/Kg, up by around 4 per cent compared to the price in the previous year of 8.45€/Kg, while the price at the end of the year was 10.64 €/Kg, up by around 27 per cent on 8.38 €/Kg at 31 December 2024. It should also be noted that the upward trend in the price of copper that began in the fourth quarter of 2025 continued in the first months of 2026, exceeding €11/kg.

• Financial risks

  These are risks associated with financial resources.

  • Credit risk

    There are no significant concentrations of credit risk. The Group monitors this risk using assessment and lending procedures with respect to each credit position. Furthermore, considering that the Group's main customers are well-structured, market-leading companies within their respective sectors, no particular risk factors have been identified that could lead to a deterioration in collection timelines or a decline in credit quality, taking into account the potential impacts of the Russian-Ukrainian, Israeli-Palestinian, and Iranian conflicts. It should also be noted that the Group has selectively activated insurance coverage in order to mitigate insolvency risk.

  • Liquidity risk

The financial situation and the credit lines available, together with the Group's high standing which makes it possible to acquire new loans quickly at competitive prices, are such as to rule out difficulties in fulfilling the obligations associated with the liabilities.

Climate change risks

The Group has assessed the significant elements of climate change risk for its activities and its business. In particular, on one hand, it is expected that the sector it belongs to may be positively impacted by an increase in demand in the medium/long-term both in specific fields, such as home and industrial automation and automotive, as well as more generally by the need to boost electric grids; on the other, the strong demand for green raw materials (in particular, copper cathodes and electricity) could drive an increase in competition.

In relation to the acute physical risks connected to extreme weather events, it is believed that the presence of a Recovery Plan, on which the procedures to be put in place to ensure continuity in supplies within contractual times, together with the signing of insurance policies with leading insurance companies should contain the negative impacts of adverse weather phenomena in both economic and business terms.

At present, although climate change may lead to an acceleration in investments as well as to an increase in operating costs, it is believed that the expected growth in volumes is more an opportunity for the Group rather than a risk.

For further details, reference should be made to paragraph "Climate change - Impacts on financial statements" of the Notes to the Group's consolidated and separate financial statements.

Risks linked to the Russia-Ukraine and Middle-East conflicts

The main risk associated with the outbreak of conflicts relates, for the IRCE Group, to increased volatility and sudden rises in the price of electricity and gas which, if not managed promptly through the implementation of appropriate sales policies, could have a significant impact on results, given that the production of electrical conductors and cables requires high energy consumption and, consequently, represents a critical variable for profit margins.

With particular reference to the ongoing wars in Ukraine and the Middle East, however, no further risks are identified either in the supply chain or in sales, as transactions involving the transit of containers through the Strait of Hormuz and the Suez Canal are limited, and the IRCE Group has no significant customers or suppliers in those countries.

Cybersecurity Risks

The spread of technologies allowing to transfer and share sensitive information virtually gives rise to computer vulnerabilities that could affect the business and compromise the business continuity of the Group.

Given the increasing frequency and breadth of cyber-attacks, IRCE identified potential issues inside and outside the company, and implemented a cybersecurity plan as well as a recovery procedure.

In the current context, given the ongoing Russia-Ukraine and Middle-East conflicts, the Group intensified monitoring and defensive activities in relation to possible malware attacks, adopting appropriate measures to mitigate risks.

2026 begins against a backdrop of considerable uncertainty regarding the outlook for the global economy and the sectors in which the Group operates, influenced by escalating geopolitical tensions, the outbreak of new conflicts, rising energy prices, and chaotic protectionist policies. In this complex scenario, and in light of the initial data available, we expect market demand to remain stable at current levels, with a possible improvement only in the latter part of the year.

During 2026, the Group will begin to benefit from the effects of the rationalisation process it has initiated, which, integrated with the medium-to-long-term growth strategy, will enable an improvement in operational efficiency and margins, with significant impacts on future results.

Production continues to increase at the plant in the Czech Republic, while in China construction of the plant has been completed and, by the end of the year, work will continue on the construction of the facilities and the installation of some of the machinery.

As regards the closure of the Dutch subsidiary Smit Draad, employment contracts with staff were terminated last July and the sale of the company's assets is currently underway.

The financial statements of the Parent Company IRCE S.p.A. show turnover of €249.07 million, up by 0.6% compared to the figure for the previous year of €247.61 million and a result for the year of €5.41 million, up compared to that of the previous year of €4.62 million.

The increase in the Parent Company's turnover is attributable to a rise in average metal sale prices, partly offset by a decrease in the volume of sales.

Compared with the previous financial year, the profit before tax benefited from a lower write-down of equity investments, as well as a greater contribution from financial income, thanks to higher dividends received from the subsidiary Irce Ltda.

For an analysis of IRCE S.p.A.'s performance, reference should be made to the previous section "Consolidated performance for 2025" since the comments on the Group are also appropriate for the Parent Company, taking account of the importance of the economic and financial data of the latter in the context of the consolidated financial statements.

The following table shows the changes in results compared to the previous year, including adjusted EBITDA and EBIT:

The Parent Company's dealings with its subsidiaries are of a commercial and financial nature, while those with the parent company, Aequafin S.p.A., are of a tax-related nature. For more details, please refer to Note 31 of the separate financial statements and to Note 32 of the consolidated financial statements.

8 The item "turnover" consists in the "sales revenues" as recognised in the income statement.

9 EBITDA is a performance indicator the Group's Management uses to assess the operating performance of the company and is not an IFRS measure; it is calculated by adding depreciation/amortisation, provisions and write-downs to EBIT.

10Adjusted EBITDA and EBIT are calculated as the sum of EBITDA and EBIT and the gains/losses on copper and electricity derivatives transactions (€

+0.92 million in 2025 and € +0.48 million in 2024). These are indicators the Group's Management uses to monitor and assess its own operating performance and are not IFRS measures. Given that the composition of these measures is not regulated by the reference accounting standards, the criterion used by the Group may not be consistent with that adopted by others and is therefore not comparable.

11 Net invested capital is the sum of net working capital, fixed assets, other receivables, net respectively of other payables, provisions for risks and charges and provisions for employee benefits.

12 Net financial position is measured as the sum of short-term and long-term financial liabilities minus cash and current financial assets (see Note 21 of the Notes to the Consolidated Financial Statements). The means of measuring the net financial position conform to that envisaged by CONSOB Warning notice 5/21 of 29 April 2021, which transposes the ESMA Guideline of 4 March 2021.

With regard to transactions with related parties, including intra-group transactions, it should be noted that they can be classified neither as atypical nor unusual, as they are part of the normal course of business of the Group's companies and have been carried out at arm's length.

Pursuant to paragraph 8 of article 5 of the "Regulations for related party transactions" adopted by Consob with resolution no. 17221 of 12 March 2010, as subsequently supplemented and most recently amended by resolution no. 21624 of 10 December 2020, it is certified that in 2025 the Company carried out 'most significant transactions' as part of the investment projects in the Czech Republic, approved by the Board of Directors of the Parent Company on 21 December 2023; however, it should be noted that IRCE, in relation to the loans disbursed and to be disbursed in favour of the subsidiaries Irce S.r.o. as part of this project, is exempt from compliance with the procedural and transparency provisions provided for by this Regulation as there are no significant interests of other parties related to IRCE in the subsidiary Irce S.r.o., with its registered office in the Czech Republic.

IRCE S.p.A. adopts the provisions of the Corporate Governance Code issued by Borsa Italiana S.p.A. as a reference for its corporate governance.

The report on corporate governance and ownership structure pursuant to art. 123-bis of the Consolidated Law on Finance (TUF) is available on the website https://www.irce.it - Investor Relations section, in compliance with art. 89-bis of the Regulation no. 11971/1999 issued by Consob; the purpose of this report is to provide the market and shareholders with a complete disclosure on the governance model chosen by the Company and its actual compliance with the provisions of the Code.

On 28 March 2008, IRCE S.p.A. adopted the organisational, management and control model pursuant to Italian Legislative Decree No. 231/2001 and set up the Supervisory Body, which is responsible for monitoring the operation, updating and compliance of the model.

The Organisational Model, in its current updated version adopted by the Board of Directors on 13 March 2026, has been developed using a risk-based approach to criminal offences with the aim of:

• aligning the components of the Preventive Control System pursuant to Legislative Decree 231/01 which were affected by the application of Legislative Decree 24/23 (known as Whistleblowing Decree), with the Whistleblowing Organisational Model adopted;

• extending the scope of prevention to 19 types of offence, thereby broadening the risk areas covered. The current Supervisory Body was appointed by the Board of Directors on 28 April 2025.

The number of treasury shares as at 31 December 2025 was 1,706,600, i.e. 6.07% of total shares, equal to a par value of €887 thousand. As at 31 December 2025, the Company did not own shares in the parent company Aequafin S.p.A., nor did it trade in them during 2025.

Research and development activities in 2025 focused on projects to improve production processes and products.

This year, expenses for development activities were recognised in the income statement, as they are not certain to be recovered in the future through future profits.

The attached consolidated and separate annual financial statements are audited by the company Deloitte & Touche S.p.A. The 2025 Sustainability Report is subject to a limited examination by Deloitte & Touché S.p.A.

Pursuant to article 2428 of the Italian Civil Code, it should be noted that IRCE S.p.A. carries out its activities in the following locations:

• Imola (BO), Via Lasie 12/a

• Guglionesi (CB), Contrada Perazzeto

• Umbertide (PG), Zona industriale Pian D'Assino

• Trezzano sul Naviglio (MI), Via Colombo, 8

The Board of Directors has approved the Sustainability Report as required by Legislative Decree no. 125 of 6 September 2024, which implemented Directive (EU) 2022/2464 (Corporate Sustainability Reporting Directive, CSRD) into national law. The purpose of the CSRD is to promote transparency and the disclosure of information by companies regarding the ESG impacts of their activities. Sustainability reporting deals with issues concerning environmental, social and governance aspects.

Pursuant to Article 2497 of the Italian Civil Code, it is confirmed that IRCE S.p.A. is not subject to management and coordination activities.

In reference to the provisions of Article 15 of Legislative Decree 125/2024, it is hereby certified that the Company does not possess any essential intangible assets.

No significant events have occurred since the end of the 2025 financial year, with the exception of the completion, in early 2026, of the production plant at the subsidiary in China.

Sustainability Reporting

1. GENERAL INFORMATION
   1. Criteria for drafting the sustainability statement

      This section of the Report on Operations represents the Consolidated Sustainability Report (hereinafter also referred to as the "Sustainability Report"), pursuant to Italian Legislative Decree no. 125 of 6 September 2024 implementing Directive (EU) 2022/2464, of the companies belonging to the Group, consisting of IRCE S.p.A. and its subsidiaries, and refers to the period between 1 January and 31 December 2025.

      The scope of reporting corresponds to that of the IRCE Group's Annual Financial Report as at 31 December 2025 and consists of all subsidiaries fully consolidated by the Parent Company, IRCE S.p.A. Please note that, with reference to Smit Draad Nijmegen, on 31 July 2025, as provided for by the agreements reached with the union and the employees, all employment relationships of the Dutch subsidiary were terminated while production activity ended in May 2025.

      The process of drafting this document took into account the main players in the Group's value chain, first and foremost during the double materiality analysis process, detailed in paragraph 1.10. Double Materiality Analysis. On that occasion, both the direct impacts, i.e. risks and opportunities deriving from the Group's own operations and the indirect impacts, i.e. consequences of the operations of the IRCE value chain, both upstream and downstream, were analysed. This document therefore also describes the material impacts of the IRCE Group's value chain, as well as the material financial risks and opportunities arising from business relationships with the stakeholders comprising the value chain, subject to the provisions of the following paragraph, in accordance with the phase-in period. The undertaking did not make use of the option to omit specific information corresponding to intellectual property, know-how or innovation results.

      1. Information in relation to specific circumstances

         The time horizons used by the Group for the preparation of this document are aligned with those defined in section 6.4 of ESRS 1. For this reason, in this Sustainability Report, when we talk about the 'short term' we are referring to a period of less than 1 year; when we talk about the 'medium term' we are referring to a period of between 1 and 5 years, and 'long term' is defined as a period of more than 5 years.

         As previously stated, when communicating metrics, the Group has not included information on the upstream and downstream value chain.

         In order to ensure that data are reliable, the Group limited the use of estimates as much as possible; where present, these are properly disclosed in the report and based on the best methods available.

         Any methods of representing quantitative data that differ from previous reports are expressly indicated by means of specific notes.

         This Sustainability Report includes the information referred to in Article 8 of Regulation (EU) 2020/852 of the European Parliament (European Taxonomy Regulation) and in Regulation (EC) 166/2006, including Annex I and Annex II. In particular, for 2025, the IRCE Group reports on taxonomy in accordance with the regulatory simplifications introduced by the Commission's Delegated Regulation (EU) 2026/73 of 4 July 2025, which amended Delegated Regulations (EU) 2021/2178, 2021/2139 and 2023/2486.

         Furthermore, this Sustainability Report does not include information by reference (ESRS 1 section 9).

         At the balance sheet date, the IRCE Group did not exceed an average of 750 employees in the 2025 financial year. Consequently, in accordance with EU Delegated Regulation 2025/1416 (the so-called "Quick-fix"), it has exercised the option to omit the information required under the disclosure obligations relating to ESRS standards E4, ESRS S1, ESRS S2, ESRS S3 and ESRS S4.

         In particular, by making use of the phase-in period, the following topics are not included in the document:

         • ESRS E4

           • Direct impact drivers of biodiversity loss

             • Land-use change, fresh water-use change and sea-use change

             • Direct exploitation

             • Pollution

           • Impacts and dependencies on ecosystem services

         • ESRS S1

           • Working conditions

             • Secure employment

             • Working time

             • Adequate wages

             • Collective bargaining, including rate of workers covered by collective agreements

             • Work-life balance

             • Health and safety

           • Equal treatment and opportunities for all

             • Training and skills development

             • Diversity

           • Other work-related rights

             • Child Labour

             • Privacy

         • ESRS S2

           • Working conditions

             • Health and safety

           • Other work-related rights

         • ESRS S4 - Consumers and end-users

           • Information-related impacts for consumers and/or end-users

             • Privacy

         At present, the company's business model and strategy are not specifically geared towards the integrated management of the impacts, risks and opportunities associated with these thematic ESRS. However, the management, administrative and supervisory bodies are considering measures to monitor the IROs associated with these themes. Furthermore, at present, the Group has not set targets, formalised policies or planned actions relating to ESRS E4, ESRS S2, ESRS S3 and ESRS S4, and will not disclose metrics relating to them.

         Regarding the ESRS S1, the IRCE Group will report information related to ESRS-SBM2 (Interests and views of stakeholders), ESRS-SBM3 (Material impacts, risks and opportunities and their interaction with strategy and business model), ESRS S1 (Own workforce) and it will provide data on S1-6, S1-7, S1-8, S1-9, S1-13, S-14 and S1-17 metrics.

   2. Role of the administration, management and control bodies

      The Corporate Governance structure of the Parent Company IRCE is based on the traditional model and is composed of the Shareholders' Meeting, the Board of Directors and the Board of Statutory Auditors.

      1. Board of Directors

         The current Board of Directors was appointed in 2025 and its term of office will expire on the date of approval of the Annual Financial Report for 2027. The Board of Directors is composed of eight members, of whom three are executive and 25% of the non-executive members of the Board of Directors are independent. It should be noted that there are no workers or workers' representatives on the Board.

         Members of the Board of Directors as at 31 December 2025 - Parent Company IRCE S.p.A.

         Board of Directors		Control and Risks Committee	Remuneration Committee	Transactions with Related Parties Committee
         Filippo Casadio	Executive Director (C)
         Francesco Gandolfi Colleoni	Executive Director
         Gianfranco Sepriano Orfeo Dallago Francesca Pischedda Elena Casadio Marianna Fabbri Carlotta Armuzzi	Non-Executive Director Non-Executive Director Non-Executive Director Executive Director Independent Director Independent Director	M C M	M M C	C M M

         C: Chairman; M: Member

         The Board of Directors guides the company with a view to pursuing its sustainable success by approving the double materiality assessment aimed at identifying the Group's sustainability-related impacts, risks and opportunities (IROs), overseeing such issues, and defining and monitoring any sustainability targets, based on updates provided by the Sustainability Team on the progress achieved. In addition, the Board of Directors approves the procedure for Sustainability Reporting and that relating to the internal control system on sustainability data and information and policies relating to sustainability issues. The Board of Directors has not delegated specific responsibilities regarding sustainability; therefore, the Board as a whole is responsible for monitoring impacts, risks and opportunities, and is responsible for ensuring that the information contained in the Sustainability Report complies with Directive 2022/2464/EU.

         Within the Board, the Control and Risks Committee was also created. It supports the Board of Directors on risk governance and management and the system of internal controls and assesses that the non-financial disclosure is suitable to correctly represent the business model, the company's strategy and the performance achieved; it also oversees the adequacy of the internal control system and the procedures to manage risks and collect non-financial data for sustainability reporting.

         All members of the Board of Directors have the appropriate professional standing and skills for the tasks entrusted to them and the number and skills of the non-executive directors are such as to ensure that they have significant weight in the adoption of Board resolutions and in guaranteeing effective monitoring of the management of sustainability issues. It is also believed that the members of the Board of Directors have significant experience in the sectors, products and geographical areas relevant to the company's business.

      2. Board of Statutory Auditors

         The Board of Statutory Auditors consists of three standing statutory auditors and two alternate statutory auditors, all of whom are independent; it should be noted that there are no employee representatives on the Board. Minority shareholders are entitled to elect one Standing Statutory Auditor and one Alternate Statutory Auditor who, like the Directors, serve for a term not exceeding three financial years, as established at the time of their appointment, and whose office ends on the date of the Shareholders' Meeting convened for the approval of the financial statements relating to the last financial year of their term of office. In particular, as required by art. 147-ter, paragraph 1-ter, of the TUF, the least represented gender must make up at least two-fifths of the elected directors.

         The current Board of Statutory Auditors was appointed in 2023 up to approval of the Annual Financial Report for 2025. The current Board of Statutory Auditors is as follows:

         Members of the Board of Statutory Auditors as at 31 December 2025 - Parent Company IRCE S.p.A.

         Board of Statutory Auditors	Office
         Donatella Vitanza	Chairman
         Fabrizio Zappi	Standing Statutory Auditor
         Giuseppe di Rocco	Standing Statutory Auditor
         Federico Polini	Alternate Statutory Auditor
         Debora Frezzini	Alternate Statutory Auditor

         In addition, the Board of Statutory Auditors verifies the sustainability reporting by overseeing the process implemented for its drafting and reports on it in the annual report to the shareholders' meeting under art.153 of the TUF, checks the corporate sustainability objectives, and in terms of risk management verifies the inclusion in corporate processes of the identification and management of sustainability-related legal risks (art. 10 of the New Decree). Pursuant to paragraph 2-ter of article 13 of Italian Leg. Decree no. 39/2010 of the New Decree, the Board of Statutory Auditors shall submit to the Shareholders' Meeting a grounded proposal for the assignment of the task to certify the conformity of the sustainability reporting. It is noted that currently controls and procedures are not applied dedicated to the management of impacts, risks and opportunities.

         All the members of the Board of Statutory Auditors are recorded in the Italian Order of Chartered Accountants and in the Register of Auditors and have gained experience in the Group's sector by collaborating with it over some years.

      3. Diversity in governance bodies

         The following table shows a breakdown of the corporate bodies by gender as at 31 December 2025. As shown in the table, 45% of the Board of Directors' members and 33% of the Board of Statutory Auditors' members are women.

         Corporate body members by gender as at 31 December - Parent Company IRCE S.p.A.

         Corporate body	Men	2025 Women	Total	Men	2024 Women	Total
         Board of Directors	4	4	8	4	3	7
         Board of Statutory Auditors (standing members)	2	1	3	2	1	3
         Total	6	5	11	6	4	10

      4. Skill and abilities of the administration, management and control bodies on sustainability issues

         The members of the Board of Directors attend training courses on corporate sustainability reporting (Corporate Sustainability Reporting Directive - CSRD). The Chair of the Board of Statutory Auditor is a sustainability auditor and cooperates with companies and organisations to integrate ESG aspects into corporate decision-making processes, monitor and evaluate sustainability performance, and provide strategic advice to align corporate objectives with the United Nations 2030 Agenda. The standing statutory auditors have participated in courses regarding corporate sustainability reporting (Corporate Sustainability Reporting Directive - CSRD) as part of their continuing professional training.

   3. Information provided to the company's administrative, management and control bodies and sustainability issues addressed by them

      In order to inform the administration, management and control bodies and their respective committees on sustainability issues, IRCE

      S.p.A. has set up an internal working group, the Sustainability Team, responsible for the process of drafting the Sustainability Report. The team is made up of the Chief Financial Officer, the Manager responsible for preparing the corporate accounting documents/Administrative Manager, the Management Control Manager and the Environment and Sustainability Manager, with the following functions:

      • supervision of the sustainability reporting process

      • interfacing with all the figures directly or indirectly involved in the process;

      • collection, processing and consolidation of the quantitative and qualitative data collected;

      • sharing of the dual materiality analysis and the related list of IROs with the administration, management and control bodies and their respective committees;

      • drafting and sharing of the sustainability report with the administrative, management and control bodies.

      The administrative, management and control bodies, thus informed on an annual basis, consider impacts, risks and opportunities in monitoring the Company's strategy, in deciding on important operations, and in determining sustainability objectives and related actions.

      For details of the relevant impacts, risks and opportunities faced by the administration, management and control bodies during 2025, please refer to paragraph 1.9. Relevant impacts, risks and opportunities and their interaction with the company strategy and model.

   4. Integrating sustainability performance into incentive systems

      Directors' Remuneration is arranged so as to align the interests of directors and executives to achieving the company's strategic targets, pursuing the primary goal of creating value for shareholders in the medium to long term. The terms and conditions of the incentive schemes are approved and updated by the Board of Directors.

      Overall Remuneration consists of:

      • a fix remuneration;

      • a short-term variable remuneration based on the achievement of predefined objectives, measured based on an economic and financial index on an annual basis;

      • a medium-term variable remuneration tied to the achievement of objectives measured based on an economic and financial index over a three-year period (equal to the BoD's term of office).

      • a medium-term variable remuneration package linked to the achievement of sustainability targets relating to the Group's emissions performance. In particular, this bonus is based on reducing the CO2 per tonne of product sold in the period under consideration, to be calculated as the ratio between the tonnes of Market-Based Scope 1 and Scope 2 CO2 during the year and the tonnes of product sold in the same period, i.e. the quantity, in tonnes, of winding wires and electrical cables sold by the Group. This emissions indicator will be calculated on the final year of office for the Board of Directors (FY 2027) and will be compared with the same indicator calculated on the last year of the previous term. The improvement in this indicator will form the correction coefficient for the medium-term bonus, calculated on the basis of the ROCE. This emissions indicator allows us to reflect the performance metrics related to the Group's sustainability in remuneration policies, as an indirect measure of good management in terms of environmental responsibility.

   5. Statement on due diligence

      Currently the Group has not defined a formalised sustainability due diligence procedure. In fulfilling their obligations, the administration, management and control bodies act according to the criteria of professionalism and diligence. Nevertheless, as part of its double materiality analysis, the Group has identified the actual and potential negative impacts on the environment and people arising from its own operations and value chain, taking into account its products, services and business relationships.

   6. Risk management

      IRCE has various risk assessment systems and concurrent management methods available, each related to a specific topic:

      • Governance, strategy and internal control system - Corporate Governance, Internal Control System as per Italian Law 262, Internal Audit and Strategic Plan;

      • Offences under Italian Legislative Decree 231/2001 - 231 Model and Code of Ethics

      • Corruption risks - Whistleblowing

      • Discrimination risks - Protection of human rights policy

      • Management risks (reference should be made to the Report on Operations), broken down as follows:

        • Market risk;

        • Environmental and safety risks - Environmental and Safety Improvement Plan - RIR, ISO 14001:2025 on environmental management systems, Legislative Decree 105/2015 on the control of major accident hazards involving dangerous substances

        • Risks associated with changes in financial and economic variables:

          • Exchange rate risk;

          • Interest rate risk;

          • Risk related to fluctuation in the price of copper;

        • Financial risks:

          • Credit risk;

          • Liquidity risk;

        • Climate change risks;

        • Cyber security risks - security measures compliant with Regulation EU 2016/679.

      1. Risk management and internal controls on Sustainability Reporting

         The Group has embarked on a process aimed at the gradual implementation of an internal control system covering the process of preparing the Sustainability Report.

         The Group has established a reporting procedure for the preparation of the Non-Financial Statement, in order to meet the new requirements arising from the preparation of the Sustainability Report in line with the CSRD. This procedure defines the roles and responsibilities of the Process Owners, who are tasked with collecting, monitoring and validating the quantitative information to be included in the sustainability disclosure. The Sustainability Team is responsible for overseeing the reporting process, liaising with all parties directly or indirectly involved in the process, collecting, processing and consolidating the data and information gathered, and drafting and sharing the Sustainability Report with the other corporate bodies. The manager responsible for preparing the corporate accounting documents certifies, in a specific report drawn up in accordance with the model established by Consob regulations, that the Sustainability Report has been prepared in accordance with the reporting standards applied pursuant to Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 and the New Decree containing the specific requirements of European legislation (new paragraph 5. ter of Article 154-bis of the TUF).

         The Parent Company collects quantitative non-financial information for the preparation of the Sustainability Report covering the 'Environmental', 'Social' and 'Governance' areas, including through a specific management system, ORACLE ERP, and a chart of accounts for sustainability, compiled by the designated manager for each Group company (Process Owner). The Sustainability Team carries out an analysis of the quality of the data uploaded to the system and verifies its consistency by comparing it with the data collected in the previous financial year; it also verifies that this data is consistent with the other indicators reported in both the non-financial and financial disclosures. In the event of anomalies, the Sustainability Team will ask for the appropriate explanations and supporting documentations. The manager responsible for preparing the corporate accounting documents draws up and keeps up to date a list of all Process Owners across the Group's various companies, categorised by subject area: energy, emissions, water, waste, employees, crimes and compliance. Each Process Owner is responsible for checking the data provided and releases a specific self-declaration, countersigned by the Plant Director, certifying the correctness of the data provided for the purposes of preparing the Consolidated Sustainability Report. The outcome of these control activities is shared with the administrative, management and supervisory bodies during the annual approval of the Consolidated Sustainable Report. A risk assessment process has not yet been implemented as part of the sustainability reporting

         process. The company undertakes, for future reports, to introduce and integrate this aspect into its business processes and to involve the Board of Directors in the sharing of the findings.

   7. Strategy, business model and value chain
      1. Strategy

         The IRCE Group is a leading European industrial group, operating in two main business areas:

         • winding wires for electrical machines used in a wide range of applications such as engines and electric generators, transformers, inductors and relays.

         • insulated cables for energy transmission used in the installation of electric systems in civil and industrial buildings and for powering and wiring electrical equipment.

         IRCE Group's main markets include electromechanical and electronics, household appliances, automotive and infrastructure sectors.

         The following table shows the number of employees by geographical area and gender as at 31 December; the reduction in staff numbers was mainly due to the departure of employees from the Dutch company Smit Draad following the cessation of its operations in mid-2025:

         Total number of employees broken down by geographical area and gender, as at 31 December
         Country	Gender	2025 31 December	2024 31 December
         Europe	Men	372	430
         	Women	65	65
         	Other	-	-
         	Unstated	-	-
         	Total Europe	437	495
         America	Men	123	116
         	Women	10	10
         	Other	-	-
         	Unstated	-	-
         	Total America	133	126
         Asia	Men	18	18
         	Women	-	-
         	Other	-	-
         	Unstated	-	-
         	Total Asia	18	18
         	Men	513	564
         Total	Women Other	75 -	75 -
         	Unstated	-	-
         Total		588	639

         Finally, it should be noted that the company is not active in the sectors indicated in ESRS 2 SBM-1, 40 d, and therefore does not generate revenues from activities related to:

         • Fossil fuels (coal, oil and gas), including any activity of prospecting, extraction, production, transformation, storage, refining, distribution, transport or trade of such fuels.

         • Manufacture of chemicals, as described in division 20.2 of Annex I of Regulation (EC) no. 1893/2006.

         • Production of controversial weapons, including anti-personnel mines, cluster munitions, chemical weapons and biological weapons.

         • Cultivation and production of tobacco.

      2. Corporate model

         The IRCE Group's business model is based on a strategic approach focused on cost leadership, growth, innovation and sustainability, ensuring competitiveness and efficiency along the entire value chain. The collection and processing of company data is carried out through advanced digitalised systems, which monitor the production process, product quality, and logistics optimisation. The cost leadership strategies are realised through the continuous updating of production equipment, improvements in control processes, and efficient logistics management. Growth is pursued through expansion in the market segments with higher margins and the consolidation of the production presence in Eastern Europe and China.

         On the innovation front, the IRCE Group invests in advanced technologies, process control software and integrated management systems, guaranteeing high quality products and services. At the same time, the adoption of high-efficiency systems reduces energy consumption and environmental impact. With a view to sustainability, the company develops initiatives aimed at mitigating its environmental impact, contributing to the fight against climate change and the reduction in emissions. It also promotes responsible human resource management, favouring the internal well-being and professional development of its employees. Thanks to this strategy, the IRCE Group guarantees concrete advantages for customers, investors and stakeholders, offering increasingly efficient products, innovative solutions and a sustainable and resilient business model in the long term.

         Currently, the Group has not defined specific sustainability objectives for significant product and service groups, customer categories, geographical areas and relationships with stakeholders, nor has it evaluated its products in relation to the company's sustainability objectives. However, the Group continues to pursue its strategic plan of focussing on sectors with higher growth and with more specialised products, including automotive (including electric cars), and energy generation and transport, which are mainly linked to the current energy transition. Investments in the two new projects - in the Czech Republic where production started in 2025, and in China (the world's leading producer of electric cars) - planned by 2026, are a step forward in this direction.

      3. Value chain

         Below is a diagram of the Group's value chain for its main product, electrical conductors for windings:

         
         
         

         The production of winding conductors starts with the purchase of copper, supplied directly from mines, which is then transformed into wire rod by specialised companies, and with the direct purchase of wire rod from European suppliers.

         Inside the IRCE Group production plants, the wire rod then undergoes the following main processing phases:

         • Drawing. During the first processing phase, the wire rod is reduced to a specific diameter according to sales requirements.

         • Enamelling. The second processing phase, carried out in a continuous cycle, consists of the application and subsequent drying and polymerisation of insulating paints, purchased from European suppliers.

         • Winding. Lastly, the enamelled wires are wound onto reels of different capacities, depending on the size of the wire and the customer's requirements.

         Before release, the material is checked by our quality control laboratories, in compliance with ISO 9001 and IATF 16949 quality standards.

         In this way, the IRCE Group sells its products to the main markets in the automotive, electromechanical and electronic and household appliance sectors all over the world

   8. Interests and views of stakeholders

      The Group recognises the importance of ongoing dialogue with and the involvement of stakeholders with a view to innovating services and processes, and improving the economic, environmental and social performance. In developing its organisational arrangements which aim at dialogue with its stakeholders, IRCE S.p.A. has grouped its main stakeholders by similar classes, thus identifying the following categories:

      • Employees of the Group's manufacturing companies;

      • Group's main raw material suppliers;

      • Main customers of the Parent Company IRCE S.p.A.;

      • Main banks of the Group;

      • Local authorities.

      The Group involves the main stakeholders in the analysis of impact materiality through a questionnaire on ESG issues, in which employees, customers, local administrations, suppliers and financial partners are asked to evaluate an aggregated list of impacts, positive and negative, actual and potential, on a scale of relevance from 1 to 5. The survey includes topics relating to Governance, Economic Performance, Product Responsibility, Environmental Aspects, Human Resources and Respect for Human Rights. This process allows us to identify the most relevant issues for the Group, taking into account the priorities expressed by the various stakeholders.

      With the aim of optimising stakeholder engagement, IRCE S.p.A. has developed an analysis matrix to define the main expectations of each stakeholder and represent the most relevant aspects for their involvement. The administration, management and control bodies are also informed of the opinions and interests of the stakeholders involved, during the sharing of the dual materiality analysis.

      Stakeholders	Main expectations and interests of Stakeholders	Reason for involvement by IRCE S.p.A.
      Employees of Group's manufacturing companies		The employees are a resource for the company not only from an operational viewpoint but also strategically. Their involvement is essential not only to understand their position on ESG themes, but also to develop the internal organisational system, to improve the corporate environment and to grow the in-house culture.

      • Professional development;

      • Protection of human rights;

      • Prospects for and protection of work;

      • Fair remuneration for work;

      • Positive work environment;

      • Efficient and effective organisational system;

      • Wellbeing;

      • Strategic development of the company, also on ESG themes.

      Group's main raw material suppliers;		The Group's main raw material suppliers are those who, together with customers, guarantee IRCE S.p.A. the sustainability of its business and so those who strategically support the development of its value chain. Their involvement is essential in order to improve the ESG impacts caused along the production chain and to consolidate commercial dealings.
      Main customers of the Parent Company IRCE S.p.A.		The main customers of the Parent Company IRCE S.p.A. are those who, together with suppliers, guarantee IRCE S.p.A. the sustainability of its business and so those who strategically support the development of its value chain. Their involvement is essential in order to improve the ESG impacts caused along the production chain and the development over time of IRCE S.p.A.
      Main banks of the Group		The main banks of the Group are important financial partners for IRCE S.p.A. and their involvement aims to improve the impacts produced by the Company, its reporting capacity and its attractiveness to external lenders.
      Local authorities		Local authorities are important for IRCE S.p.A. since corporate development is also based on the ability to deal with reference areas and communities, to understand their distinctive features, and local assets. In this process, dialogue with those who govern the community is essential in order to enhance dialogue and to integrate the whole corporate community into the territory to which it belongs.

      • Fair distribution of added value;

      • Economic-financial growth of the company;

      • Respect of sustainability principles by IRCE S.p.A.;

      • Correctness in commercial dealings.

      • Fair distribution of added value;

      • Economic-financial growth of the company;

      • Respect of sustainability principles by IRCE S.p.A.;

      • Correctness in commercial dealings;

      • Quality of products.

      • Fair distribution of added value;

      • Economic-financial growth of the company;

      • Respect of sustainability principles by IRCE S.p.A.;

      • Updated and constant information in both the economic-financial field and in ESG.

      • Respect of sustainability principles by IRCE S.p.A.;

      • Contribution of IRCE S.p.A. to local development;

      • Prospects for and protection of work;

      • Economic-financial growth of the company;

      • Strategic development of the company.

   9. Material impacts, risks and opportunities and their interaction with strategy and business model

      The impacts, risks and opportunities (IRO) relevant to the Group identified through the Double Materiality Analysis are described in the following table, which also specifies:

      • the time horizon within which the effects of each IRO are expected to occur;

      • the nature and type of impact: positive or negative, actual or potential;

      • the source of risks and opportunities;

      • the nature of the IROs' contribution;

      • the activities of the Group and/or its value chain that originate each IRO.

      The Group carried out an analysis which revealed that its production sites are located close to areas sensitive to biodiversity; consequently, as part of its double materiality analysis, it identified biodiversity as a material issue. However, this issue has not been reported in this document as the company has made use of the phase-in period, as stated in paragraph 1.1.1. Disclosures in relation to specific circumstances

      The Group has not carried out a detailed assessment of its dependencies on biodiversity and ecosystem services, nor of the transition and physical risks and opportunities related to biodiversity, including its value chain. Furthermore, the Group has not consulted with affected communities regarding sustainability assessments of shared biological resources and ecosystems.

      IRCE continues to monitor regulatory developments and stakeholder expectations in this area and will assess the need for further assessments in the future.

      ESRS topics IROsIRO description Horizon

      I Direct and indirect emissions generated Short-term

      Nature

      Negative

      Type

      Actual

      RO source Contribution type Value chain stage

      - Caused by the Group Own operations

      I Emissions generated along the value chain Short-term

      Negative

      Actual

      • Group and related to the Group through its commercial dealings

        Upstream and downstream value chain

        I Energy Consumption Short-term

        Negative

        Actual

      • Caused by the Group Own operations

      ESRS E1

      R Operational interruptions due to chronic physical events

      Long-term -

      - Dependencies - Own operations and downstream value chain

      Own operations, and

      Climate Change

      R Inadequate strategy for mitigating emissions Medium-term -in the value chain

      Impacts and

      • dependencies

      • upstream and downstream value chain

        R Absence of an energy transition plan Short-term -Increased energy efficiency and self-

        - Impacts and dependencies

        Impacts and

        - Own operations and downstream value chain

        O sufficiency through the generation of Medium-term -

        renewable energy

        - dependencies - Own operations

        I Generation of other significant atmospheric emissions

        Short-term

        Negative

        Actual

        - Caused by the Group Own operations

        ESRS E2 Pollution

        I Use of substances of concern Short-term

        Negative

        Actual

        - Caused by the Group Own operations

        I Use of substances of very high concern Short-term

        Negative

        Actual

        - Caused by the Group Own operations

        ESRS E3 Water and marine

        I Efficiency and water saving Short-term

        Positive

        Actual

      • Caused by the Group Own operations

        resources

        I Water withdrawal and its impact on areas experiencing water stress

        Short-term

        Negative

        Actual

        - Caused by the Group Own operations

        I Loss of biodiversity resulting from soil erosion caused by copper mining in the supply chain

        Indirect negative impacts on biodiversity

        Short-term

        Negative

        Actual

        - Group and related to the Group through its commercial dealings

        Caused by the Group and related

        Own operations and upstream value chain

        Own operations and

        ESRS E4 Biodiversity and

        I resulting from environmental pollution Long-term

        Negative

        Potential

      • to the Group through its

        commercial dealings

        upstream value chain

        ecosystems

        R Supply difficulties caused by changes to ecosystems

        Long-term -

        • Impacts and dependencies

        • Upstream value chain

        R Adoption of stricter regulations for the Medium-term -protection of biodiversity

        - Impacts and dependencies

        - Upstream value chain

        R Risk of deterioration of ecosystems caused by the IRCE Group's supply chain activities

        Long-term -

        Impacts and

        - dependencies -

        Own operations and upstream value chain

        ESRS E5 Resource use and circular economy

        I Use of raw materials Short-term I Use of virgin and non-renewable materials Short-term

        Innovative solutions and products for the

        I transition towards environmentally Medium-term compatible materials

        I Waste generation Short-term

        Negative Negative

        Positive

        Negative

        Actual Actual

        Potential

        Actual

      • Caused by the Group

      • Caused by the Group

      • Caused by the Group

      • Caused by the Group

      Own operations Own operations

      Own operations

      Own operations

      R Inefficient management of incoming resources

      Short-term -

      Impacts and

      - dependencies -

      Upstream value chain

      O Strengthening our competitive position in the Medium-term circular economy

      I Job instability for the Group's personnel Short-term

      -

      Negative

      -

      Potential

      Impact -

      - Caused by the Group

      Own operations Own operations

      I Non-compliance with working hours by Group staff

      Short-term

      Negative

      Potential

      • Caused by the Group

        Own operations

        I Inadequate remuneration of Group staff Short-term The Group's failure to engage in dialogue with

        Negative

        Potential

      • Caused by the Group

      Own operations

      ESRS S1 Own workforce

      I trade unions and to negotiate collective

      agreements

      I Failure to respect the work-life balance of the Group's employees

      Short-term

      Short-term

      Negative

      Negative

      Potential

      Potential

      • Caused by the Group

      • Caused by the Group

      Own operations

      Own operations

      I Accidents and occupational illnesses within the Group

      Short-term

      Negative

      Actual

      Caused by the Group

      Own operations

      I Training and talent management within the Group

      Short-term

      Positive

      Actual

      - Caused by the Group

      Own operations

      I Child labour within the organisation Short-term I Forced labour within the organisation Short-term

      I Inadequate management of IT security Medium-term

      Negative Negative Negative

      Potential Potential Potential

      • Caused by the Group

      • Caused by the Group

      • Caused by the Group

      Own operations Own operations Own operations

      ESRS S2

      I Accidents and work-related ill health along the value chain

      Short-term

      Negative

      Potential

      - Group and related to the Group through its commercial dealings

      Upstream and downstream value chain

      Workers in the value chain ESRS S4 Consumers and final users

      I Child labour in the value chain Short-term

      I Forced labour in the value chain Short-term I IT security for customers and end users Short-term

      Negative Negative

      Positive

      Potential Potential

      Actual

      • Group and related to the Group through its commercial dealings

      • Group and related to the Group through its commercial dealings

      • Caused by the Group

      Upstream and

      downstream value chain Upstream and downstream value chain

      Downstream value chain

      ESRS G1 Business conduct

      Own operations

      I	Corporate culture	Short-term	Positive	Actual	-	Caused by the Group
      I	Failure to protect whistleblowers	Short-term	Negative	Potential	-	Caused by the Group
      I	Payment to suppliers	Short-term	Negative	Potential	-	Caused by the Group
      I	Anti-corruption prevention and training	Short-term	Positive	Actual	-	Caused by the Group
      I	Incidents of corruption	Short-term	Negative	Potential	-	Caused by the Group
      O	Sustainable procurement practices	Medium-term	-	-	Impact	-

      Own operations

      Own operations and upstream value chain

      Own operations

      Own operations

      Own operations and upstream value chain

      Significant impacts, both positive and negative, are closely linked to the business strategy and model. For this reason, the Group recognises their influence on people and the environment, and adopts appropriate measures to minimise such impacts, when negative. IRCE also describes how these elements manifest themselves within its operations and along the entire value chain, identifying the main points of concentration. Compared with the materiality analysis approved in 2024, the following new impact has been identified as material: "Loss of biodiversity resulting from soil erosion due to copper mining in the supply chain", relating to theme E4 Biodiversity. Unlike the materiality analysis carried out in 2024, the following impacts have not been identified as material: "Exclusion of people with disabilities from the Group's workforce", as the Group complies with legal obligations regarding the employment of people with disabilities and has not recorded any cases of non-compliance in this regard; and "Water discharges", as the Group does not generate significant impacts in this area, having also adopted water recycling systems for water discharged from production processes. The "Risk of non-compliance due to failure to observe occupational health and safety regulations" was not found to be material, as the Group adopts preventive measures and management systems relating to occupational health and safety, in compliance with the requirements of current legislation, which have enabled a progressive reduction in the accident rate. Furthermore, the positive impact "Protection of the economic, social and cultural rights of local communities", relating to S3 theme "Affected communities", was not found to be material, as the Group does not generate impacts considered significant from an economic, social and cultural perspective on local communities.

      Furthermore, the IRCE Group adopts a resilient and dynamic approach, constantly adapting its strategy to manage significant risks and impacts, while seizing new opportunities. This process ensures a continuous balance between business objectives and sustainability needs, allowing the company to adapt promptly to market changes and environmental challenges, thus ensuring operational continuity and sustainable growth in the long term. To date, no quantitative analysis has been carried out of the resilience of the company's strategy and business model.

      For a description of the relevant impacts, risks and opportunities arising from the materiality assessment, please refer to the individual chapters on the thematic ESRS. For detailed information regarding the current and expected effects of the impacts, risks and opportunities with respect to topical ESRS being reported on, and the way in which the IRCE Group plans to respond to these effects, please refer to the specific reference sections for each topical ESRS and the IRO 1 table. For details of the impacts on people and the environment, please refer to the individual thematic chapters.Taking into account the material risks and opportunities identified, the Group has not identified any financial effects or significant risks of material adjustments in the following financial year to the carrying amounts of the assets and liabilities reported in the relevant financial statements. In the double materiality process, the Group has not identified any impacts, risks or opportunities that would require the adoption of entity-specific indicators.

   10. Double Materiality Analysis

       In order to provide more complete and transparent information to the various stakeholders, so that they can more accurately assess the context in which the company operates, the CSRD requires that the company's material impacts, risks and opportunities be identified according to the principle of double materiality. In this way, it is necessary to proceed to a double materiality assessment:

       • Relevance of impact: assess the impact of your activities on people, the environment, society and human rights across the board (inside-out approach).

       • Financial relevance: assess how sustainability issues affect your activities (outside-in approach).

         In the process of identifying material impacts, risks and opportunities (IRO) relating to sustainability issues, the IRCE Group uses various sources, including the sustainability reporting standards issued by EFRAG. Furthermore, the Group's main internal and external stakeholders also participate in this process through the administration of specific questionnaires. In this way, the Group takes into account the external context in which it operates when identifying its impacts, and assesses the risks and opportunities arising from the impacts generated by the Company.

         1. Impact materiality

            A sustainability topic is material from an impact perspective when it has actual or potential, positive or negative, short-, medium- or longterm impacts on people or the environment.

            The preliminary identification of potentially relevant topics for the purposes of impact materiality is based on international sources such as The Sustainability Standard and Poors Yearbook - 2024 and the Sustainability Reporting Standard for the Electrical and Electronic

            Equipment Sector issued by the IFRS Foundation, also taking into account the effects of IRCE's direct activities, those deriving from the commercial relations, corporate strategies, the results of benchmarking activities, and the analysis of the national and European regulatory landscape in terms of sustainability and sustainable finance.

            Based on this initial identification, the impacts are subjected to two assessments. Firstly, senior management at the Parent Company IRCE assesses the list of potentially significant impacts identified following the aforementioned context analysis. Secondly, a sample of the Group's main categories of internal and external stakeholders, including employees, customers, local authorities, suppliers and financial partners, provides feedback through an assessment of a selection of impacts. In both questionnaires, the impacts relate to sustainability themes, sub-themes and sub-sub-themes set out in AR 16 of ESRS 1 and concern environmental, social and governance dimensions.

            Each impact must be rated based on two parameters:

       • Gravity, that is, how significant the impact generated by the Group is. This index can range from 1 (negligible) to 5 (extreme) and includes:

         • Scale: how positive or serious the impact is. In this parameter, for negative impacts, it is necessary to consider the potential remediability of the event itself.

         • Scope: how widespread the impact is.

         • Irremediability: if and to what extent only negative impacts can be remedied.

       • Probability, or how likely it is that a potential impact will occur. This index can range from 1 (rare) to 5 (current).

         To define the list of material issues to be reported in the Sustainability Report, the results of the assessments carried out by the senior management of the Parent Company IRCE are analysed; these are then reviewed, taking into account the feedback provided by internal and external stakeholders. In order to determine material impacts, a materiality threshold of 2.30 has been established on a scale ranging from 1 to 5.

         1. Financial materiality

            The preliminary identification of risks and opportunities relevant to financial materiality is based on internal sources,such as ISO 9001 and 14001, and on benchmarking activities, as well as analyses of the risks and opportunities arising from the Parent Company's quality, prevention and safety systems in relation to sustainability issues applicable to the organisation. The list is supplemented, taking into account the possible interconnections between IRCE impacts and dependencies and any risks and opportunities that may arise from them. On the basis of this initial identification, a special questionnaire for the evaluation of financial materiality is drawn up, to be voted on by the Parent Company's key people such as the Finance Director, the Administrative Manager and the Management Control Manager.

            The risk assessment takes into account the:

       • Inherent or potential risk, which includes:

         • Probability, i.e. the likelihood of the risk materialising. This index can range from 1 (rare) to 5 (probable), based on three alternative scenarios: past cases, future forecasts and estimated percentage probability of occurrence.

         • Impact, i.e. the economic impact when the risk materialises. This index can range from 1 (low) to 5 (high) and is assessed in terms of its effect on the IRCE Group's normalised economic-financial data, determined as the arithmetic average of the last three years' balance sheet values (2023-2025).

       • Inherent risk mitigation index which is determined by its degree of effectiveness in terms of reducing inherent risk and hence negative economic/financial impacts. This index can range from 0 (non-existent) to 5 (high) and thus reduce risk from 0% to 100% respectively.

       • Residual risk, which includes:

         • Probability, i.e. the likelihood of the risk materialising.

         • Impact, i.e. the economic/financial impact for the company when the risk occurs.

         • Risk mitigation effectiveness, i.e. the IRCE Group's ability to reduce the economic/financial impacts associated with the occurrence of the inherent risk.

           The assessment of opportunities takes into account the:

       • Probability, i.e. the likelihood of the opportunity materialising. This can range from 0 (rare) to 5 (probable).

       • Impact, i.e. the economic positive impact for the Company associated with an opportunity being realised. The intensity of the impact can range from 0 (low) to 5 (high) and is assessed in terms of the effect on the IRCE Group's normalised economic-financial data, determined as the arithmetic average of the last three years' balance sheet values (2023-2025).

       All risks (at residual level) and opportunities that are identified as significant or very significant following the assessment are therefore included in the financial materiality assessment, for which a materiality threshold of 16 has been set on a scale of 0 to 25.

       It is specified that the entire process of identifying, assessing and managing ESG risks and opportunities has been integrated into the Group's overall corporate risk management system. This approach makes it possible to assess the overall risk profile and optimise the various management processes, ensuring a holistic view of potential challenges for IRCE by integrating ESG aspects into the decision-making process. Currently, ESG risks and opportunities are not prioritised.

       The double materiality assessment then led to the identification of ESG impacts, potential risks, and opportunities that are material to the Group and its value chain. The result of the analysis conducted was shared and approved by the Board of Directors. The double materiality analysis process has not changed from the previous year and was carried out in accordance with the methodology set out in ESRS 1 -Double materiality as the basis for sustainability disclosures and in IG 1 - Materiality assessment issued by EFRAG.

       1. Involvement of workers' representatives

          The Parent Company IRCE S.p.A. informs workers' representatives at the appropriate level (RSU or unitary union) about information regarding sustainability and discusses with them the relevant information and the means of obtaining and verifying this information. The information area mainly concerns information to be provided according to ESRS S1, but may also cover other profiles that may affect or be affected by employees. Thus informed, the workers' representatives communicate their opinion, if any, to the administrative and audit body (art. 4, para. 9 of the New Decree).

          The involvement of workers' representatives takes place after the approval of the Sustainability Report by the Board of Directors. There, the sustainability information is presented in its entirety, so that the company can gather feedback and opinions to be taken into account in the following year's Sustainability Report.

2. ENVIRONMENTAL INFORMATION
   1. Disclosure pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)

      EU Regulation 2020/852 (hereinafter the "Regulation"), which entered into force on 1 January 2022, introduced the European Taxonomy (hereinafter also the "Taxonomy"), a classification system for economic activities that may be considered environmentally sustainable. This Regulation was followed by the Delegated Regulations (EU Regulations 2021/2139 and 2021/2178), as subsequently amended and supplemented (EU Regulations 2023/2485 and 2023/2486).

      The aforementioned Regulations are aimed at establishing that an economic activity is considered environmentally sustainable if it makes a substantial contribution to achieving one or more of the six environmental goals defined by the Taxonomy:

      1. Climate change mitigation;

      2. Climate change adaptation;

      3. Sustainable use and protection of water and marine resources;

      4. Transition to a circular economy;

      5. Pollution prevention and control;

      6. Protection and restoration of biodiversity and ecosystems.

         This Regulation was followed by the following regulatory updates:

         • Climate Delegated Act (2021/2139/EU);

         • Delegated Act pursuant to Art. 8 (2021/2178/EU);

         • Supplementary Delegated Act on Climate (February 2022);

         • Delegated Regulation 2023/2485 on supplementary measures to support climate objectives;

         • Delegated Regulation 2023/2486 on the four non-climate-related environmental objectives, also amending and supplementing the Disclosures Delegated Act (2021/2178/EU).

           In order to classify an activity as "environmentally sustainable" pursuant to the Taxonomy, it is necessary therefore first to identify the eligible economic activities and then to assess their alignment by verifying compliance with the technical criteria envisaged by the law for the specific activity, i.e.:

         • making a substantial contribution to achieving one or more of the environmental goals;

         • complying with the technical screening criteria set by the European Commission;

         • not doing significant harm to any of the environmental goals (DNSH);

         • be carried out in accordance with minimum safeguards regarding respect for human rights and labour standards.

      Therefore, pursuant to Article 8 of the Taxonomy Regulation, for the 2025 financial year, IRCE is required to provide information on how and to what extent its activities are associated with environmentally sustainable economic activities within the meaning of the EU Taxonomy, disclosing the proportion of turnover, capital expenditure (CapEx) and operating expenditure (OpEx) associated with environmentally sustainable economic activities, i.e. those that are eligible and aligned with the Taxonomy.

      It should be noted that, as of this report, the Group applies the simplifications introduced by Commission Delegated Regulation (EU) 2026/73 of 4 July 2025, which amended Delegated Regulations (EU) 2021/2178, 2021/2139 and 2023/2486.

      Based on the analysis of its economic activities, the Group has confirmed its assessment that its activities are not included among those currently identified by the applicable regulatory framework with respect to the aforementioned objectives, and consequently no portion of turnover recorded in 2025 is considered EU Taxonomy-eligible or -aligned.

      With regard to capital expenditure (CapEx) for the 2025 financial year, in line with the provisions of the new Delegated Regulation (EU) 2026/73, no assessment of eligibility and alignment was carried out for a residual portion of capital expenditure amounting to 7.8% of the denominator of the CapEx KPI. Analysis of the remaining capital expenditure examined did not identify any investments associated with economic activities considered eligible or aligned with the objectives of the European Taxonomy.

      As regards operating expenditure (OpEx) for the 2025 financial year, the analysis did not reveal any expenditure associated with economic activities considered eligible or aligned with the objectives of the European Taxonomy. For the purposes of calculating operating expenditure (OpEx), uncapitalised research and development costs, maintenance costs and costs for the use of third-party assets (non-IFRS16) were considered.

      Proportion of turnover, CapEx from products or services associated with economic activities that are taxonomy eligible or aligned - Disclosure for 2025 (Summary KPI)

      Financial year 2025
      KPI	Totale	Percentage of taxonomy eligible activities	Taxonomy aligned activities	Percentage of taxonomy aligned activities	Breakdown by environmental goal of the taxonomy aligned activities						Percentage of enabling activities	Percentage of transition activities	Activities not assessed as not considered relevant	Taxonomy aligned activities in the previous year (2024)	Percentage of taxonomy aligned activities in the previous year (2024)
      					Climate change mitigation	Climate change adaptation	Water	Circular economy	Pollution	Biodiversity
      	€/000	%	€/000	%	%	%	%	%	%	%	%	%	%	€/000	%
      Turnover	381.105	0%	0	0%	0%	0%	0%	0%	0%	0%	0%	0%	0%	0	0%
      CapEx	19.581	0%	0	0%	0%	0%	0%	0%	0%	0%	0%	0%	7,8%	0	0%
      OpEx	3.946	0%	0	0%	0%	0%	0%	0%	0%	0%	0%	0%	0%	0	0%

   2. CLIMATE CHANGE
      1. Integrating sustainability performance into incentive schemes

         The variable remuneration of executive directors and strategic managers for the three-year period 2025-2027 provides for a medium-term variable bonus linked to sustainability objectives. In particular, the award is linked to the Group's emissions performance. This bonus is in fact based on the reduction of CO2 emissions per tonne of product sold in the reference period. The calculation is performed by dividing the tonnes of Scope 1 and Market-Based Scope 2 CO2 emissions generated during the year by the tonnes of product sold in the same period, i.e. the overall quantity, in tonnes, of winding wires and electrical cables sold by the Group. This emissions indicator will be determined based on the final year of office of the Board of Directors (2027) and will be compared with the same value recorded in the last year of the previous term (2024). The improvement in this indicator will be the correction coefficient for the medium-term bonus calculated on the basis of the ROCE (a calculation method set out in the Report under article 123-ter of the TUF for 2022 approved by the IRCE Board of Directors on 15 March 2024). This parameter allows sustainability metrics to be integrated into remuneration policies, representing an indirect indicator of good management in terms of environmental responsibility.

      2. Transition plan for climate change mitigation

         To date, a transition plan for the mitigation of climate change, as called for by the Paris Agreement of 12 December 2015, has not yet been formalised. It should be noted that the IRCE Group is currently working on drawing up its own transition plan for the future.

      3. Climate change impacts, risks and opportunities

         The material climate-related risks and opportunities that were identified in the double materiality analysis are summarised below:

         • Increased energy efficiency and self-sufficiency through the generation of renewable energy (opportunity)

         • Operational interruptions due to chronic physical events (physical risk);

         • Inadequate emission mitigation strategy in the value chain (transition risk):

         • Absence of an energy transition plan (transition risk)

         To date, the IRCE Group has not carried out a formal resilience analysis of its strategy and business model in relation to climate change, including an analysis of climate scenarios. However, in 2024, as part of the review process of the Integrated Environmental Authorisation for the Imola site, a specific technical study was carried out that did not identify a flood risk for the area in question and therefore no measures to contain the risk were envisaged. In 2025, a NATECH risk assessment (floods, landslides, seismic events, winds, lightning strikes and storm surges) was also carried out as planned for the Imola site, as part of the update to the Regional Technical Data Sheet required by Legislative Decree 105/15 (known as Seveso Ter). This analysis indicated a risk level that was in some cases non-existent (e.g. for the risk of landslides and storm surges), very low (strong gusts of wind, whirlwinds and tornadoes, lightning strikes) and low (flooding), without requiring further specific investigations. Further investigations will, however, be carried out regarding seismic risk in 2026.

         As direct, indirect, and value chain emissions, and energy consumption are currently generating negative effects on the environment, the IRCE Group is committed to reducing energy consumption by optimising its production processes and gradually decreasing the use of non-renewable energy sources. Furthermore, with regard to the opportunity linked to climate change identified as material through the double materiality analysis (Development of an Energy Transition Plan), IRCE demonstrates a proactive stance in seizing it, while adopting a flexible approach to the associated risks, standing ready to intervene promptly should they materialise. However, no changes to the company strategy have been made or are currently planned.

      4. Identification and assessment of relevant climate change impacts, risks and opportunities

         The IRCE Group has identified and assessed climate-related impacts, risks and opportunities as part of its double materiality analysis process. To properly understand and address the challenges posed by climate change, an in-depth analysis of the Group's operations was carried out, taking into account the complexity of the value chain, in order to identify physical and transition risks as well as climate-related opportunities. The relevant impacts that emerged are closely linked to energy consumption and the generation of direct and indirect emissions by the Group and the players in the value chain. In addition, a physical risk related to the possible interruption of the Group's operations due to chronic physical events, with a time horizon of potential occurrence in the long term, and two transition risks related to

         an inadequate emissions mitigation strategy in the value chain and the absence of an energy transition plan have been identified as material. However, the Group has qualitatively assessed both its own activities and those along the value chain to estimate the extent of the potential effects of these risks and opportunities. For more information regarding the double materiality analysis conducted, please refer to reference paragraph 1.10. Double Materiality Analysis

         The identification and assessment of climate-related physical risks, transition risks and opportunities were not carried out using climate scenario analysis. It should be noted that the company has not identified climate-related hazards by considering at least high-emission climate scenarios, nor has it identified climate-related transition events by taking into account at least one climate scenario consistent with limiting global warming to 1.5 °C. Furthermore, the Group has not examined how its activities may be exposed to such climate-related hazards and transition events.

      5. Climate change mitigation and adaptation policies

         To date, the IRCE Group has not yet formalised a policy aimed at managing its material impacts, risks and opportunities relating to climate change mitigation. The IRCE Group recognises as its main objectives in terms of sustainability the reduction of consumption through production process efficiency and the gradual reduction of energy consumption from non-renewable sources: this is aimed at achieving net zero by 2050 for all GHG Scope 1, 2 and 3 emissions in absolute terms and in terms of intensity as provided for by the Paris Agreement on Climate Change of 12 December 2015. The Group will therefore formalise a relevant policy, with the objective of a progressive decarbonisation of the production process.

         The Imola plant adopts an Environmental Policy that reflects the commitment of the company management and addresses various aspects, including optimising the consumption of electricity and methane gas together with the implementation of interventions on the production process to reduce atmospheric emissions, improving energy efficiency through technical interventions aimed at limiting the consumption of electricity and methane gas, and promoting renewable energy, both through the direct supply through the construction of photovoltaic plants, and indirectly through the use of the Guarantee of Origin.

         1. Actions and resources related to climate change policies

            The Group has, however, taken steps to reduce its impact on climate change; in particular, in 2025, the Czech subsidiary IRCE S.r.o. invested in energy-saving and energy-efficiency equipment for its production facilities. Further projects and investments completed in 2025 are listed below.

            Shares	Expected results	Scope	Horizon	Significant monetary amounts of Capex	Progress of activity
            Purchase of new machinery and latest generation systems	Reduction in energy consumption	IRCE S.r.o.	2025	€731,77713	Completed
            Replacement of compressors	Reduction in energy consumption	IRCE Spa - Imola	2025	€86,218	Completed: the related energy saving is estimated at 1,500 kWh/p.a.
            Purchase of 8-tonne electric forklift in place of diesel	Reduction in consumption of fuel from fossil fuels	IRCE Spa - Imola	2025	€180,800	Completed
            Reconstruction of roof at Guglionesi plant	Reduction in energy consumption	IRCE Spa - Guglionesi	2025	€525,000	Completed

            13 Investments in 2024 for costs incurred on assets under construction

            At the IRCE S.p.A. plant in Imola, an energy efficiency project is also underway, utilising AI software that collects and analyses process data from the glazing lines: by optimising the control of the production lines, energy consumption could be reduced. A feasibility study is also being launched for the modernisation of the post-combustion system currently used to treat part of the emissions from the furnaces on the medium-diameter wire glazing lines: any investment would lead to a reduction in natural gas consumption. It should be noted that, at present, the financial resources allocated to the described initiative are not significant.

         2. Climate change policy objectives

            To date, the IRCE Group has not defined specific objectives on climate change mitigation, adaptation and GHG emission reduction, as it intends to first carefully assess how these objectives can be harmonised with the corporate strategy. However, specific initiatives are already underway to reduce energy consumption from non-renewable sources, while favouring the use of renewable energies, as demonstrated by the construction at the Imola plant of a photovoltaic system with a total capacity of 5,887 kWp and the purchase of energy from certified renewable sources, details of which are given in the next paragraph.

      6. Energy consumption and energy mix

         It should be noted that, in the previous reporting period, in line with art. 4 of Legislative Decree no. 254, according to which it was possible to exclude those companies that, although included in the area of accounting consolidation, were not necessary for the purpose of understanding the Group's business, its performance, results and the impact produced by the business, qualitative information and quantitative data relating to

         the environmental aspects of "commercial or small companies" were not collected and reported. The following table shows:

         • Total energy consumption from fossil sources, disaggregated by:

         • Consumption of coal and coal products;

         • Consumption of fuels from crude oil and petroleum products;

         • Consumption of fuels from natural gas;

         • Consumption of fuels from other fossil sources;

         • Consumption of electricity, heat, steam or cooling from purchased or acquired fossil sources.

         • Total energy consumption from nuclear sources;

         • Total energy consumption from renewable sources, disaggregated by:

           • consumption of fuels from renewable sources, including biomass (which also includes industrial and municipal waste of biological origin), biofuels, biogas, hydrogen from renewable sources, etc;

           • consumption of electricity, heat, steam and cooling from purchased or acquired renewable sources; and

           • consumption of self-produced renewable energy without using fuels.

             All energy consumption shown below has been calculated in MWh.

             In addition, energy consumption from non-renewable sources and energy production from renewable sources in MWh have been disaggregated and highlighted separately in the following table.

             Energy consumption and energy mix

             Source	2025 Total MWh	2024 Total MWh
             Consumption of coal and coal products	267	178
             Fuel consumption from crude oil and petroleum products	1,576	1,253
             Fuel consumption from natural gas	15,774	17,659
             Fuel consumption from other non-renewable sources	0	0
             Consumption of electricity, heat, steam and cooling from purchased or acquired fossil sources	25,190	49,636
             Total energy consumption from fossil sources	42,807	68,727
             Share of fossil sources in total energy consumption	38%	57%
             Consumption from nuclear sources14
             Share of nuclear sources in total energy consumption	0%	0%
             Fuel consumption for renewable sources, including biomass (also includes industrial and municipal waste of biological origin, biogas, renewable hydrogen, etc.).	0	0
             Consumption of electricity, heat, steam and cooling from purchased or acquired renewable sources	63,122	44,946
             Consumption of self-generated renewable energy without using fuels	7,424	7,263
             Total energy consumption from renewable sources	70,546	52,209
             Share of renewables in total energy consumption	62%	43%
             TOTAL ENERGY CONSUMPTION	113,353	120,936

             It should also be noted that for small subsidiaries, such as the Polish subsidiary IRCE S.p.zo.o., estimates were used, considering the same electricity consumption as for companies with similar activities and size. For IRCE S.p.A., estimates were used in calculating the consumption of fossil fuels, such as the consumption of diesel, considering the ratio of the cost of refuelling undertaken to the average cost of diesel during the specific reporting period.

             The reduction in total energy consumption from fossil fuels is mainly due to:

         • overall reduction in production, and thus in consumption, during 2025 compared to 2024;

         • Dutch subsidiary Smit Draad ceased trading in the first half of 2025;

           The increase in the percentage of energy from renewable sources is due to the Group's participation in the Energy Release mechanism. The Group's 2025 renewable energy consumption of 70,546 MWh is comprised of 10.5% self-generated electricity from a photovoltaic system and the remaining 89.5% purchased electricity from renewable sources. Specifically, 39.7% of the 63,122 MWh of electricity purchased from renewable sources comes from the Energy Release mechanism15and 60.3% from certified renewable energy purchased by the Group.

           1. Energy intensity versus net revenue

              The following table shows the energy intensity (total energy consumption in relation to net revenue) associated with activities in high climate impact sectors.

              14 In applying the prudential approach referred to in ESRS E1 AR32(j), the Company considers such consumption "derived from renewable sources" only when the origin of the purchased energy is clearly defined in the contractual agreements with suppliers (e.g., Guarantees of Origin). Consequently, for the portion not covered by these instruments, the Company does not disaggregate the purchased electricity, steam, heat, or cooling by generation source for the purposes of ESRS E1-5 and, therefore, does not attribute components from renewable or nuclear sources to such consumption, treating them as non-renewable

              15 With reference to the share of renewable energy certified within the Energy Release mechanism, it should be noted that the share equal to 24,995 MWh for 2025 refers to the share that, as of the date of this document, has been recognized by the GSE to IRCE SpA, pending the issuance of the relevant guarantee of origin (GO) certificates expected in April 2026.

              Energy intensity versus net revenue

              	2025 Value	2024 Value	Change %
              Total energy consumption (MWh)	113,352	120,936	-6.27%
              Net revenues (€/000)	377,643	397,654	-5.03%
              Energy intensity (MWh /€/000)	0.300	0.304	-1.30%

              All of the Group's production activities fall within the sector of the manufacture of other electrical and electronic wires and cables, which is considered a high climate impact sector.

              Therefore, the net revenues used for the calculation of energy intensity coincide exactly with the net revenues shown in the consolidated income statement under "Revenues".

      7. Gross Scope 1, 2 and 3 GHG emissions and total GHG emissions16

         It should be noted that the data used to calculate Scope 1 and 2 emissions was collected exclusively within the consolidated accounting group. Currently, there are no investees, such as associates, joint ventures or unconsolidated subsidiaries, that are not fully consolidated in the financial statements of the consolidated accounting group, nor are there any contractual arrangements that constitute unorganised joint control arrangements through an entity (i.e. jointly controlled operations and assets) over which it exercises operational control.

         1. Gross Scope 1 GHG emissions

            The following table shows the gross Scope 1 GHG emissions, expressed in metric tonnes of CO2eq, and the percentage of Scope 1 GHG emissions covered by regulated emissions trading schemes.

            Gross Scope 1 GHG emissions

            	2025	2024	Change
            	tCO2e	tCO2e	tCO2e	%
            Gross Scope 1 GHG emissions	3,341	3,584	-242	-6.76%
            Percentage of Scope 1 GHG emissions covered by regulated emissions trading schemes	-	-	-	-

         2. Gross Scope 2 GHG emissions

            The following table shows the gross Scope 2 GHG emissions based on location (Location-Based Method) and market (Market-Based Method), expressed in metric tonnes of CO2eq.

            Gross Scope 2 GHG emissions - location-based method [E1-6: 49 a]

            	2025 tCO2eq	2024 tCO2eq	tCO2eq	Change	%
            Gross Scope 2 GHG emissions - location-based method	18,988	27,705	-8,716	-31.46%

            Gross Scope 2 GHG emissions - market-based method [E1-6: 49 b]

            16 The emission factors from the UK Government's 'GHG Conversion Factors for Company Reporting - DEFRA 2024 and 2025' were used to calculate Scope 1 emissions. For the calculation of 2024 Scope 2 Location-Based and Market-Based emissions, the emission factors from the AIB - European Residual Mixes 2023, Baseline Database for the Indian Power Sector, and IGES List of Grid Emission Factors were used. For the calculation of 2025 Scope 2 Location-Based and Market-Based emissions, the emission factors from the AIB - European Residual Mixes 2024, Baseline Database for the Indian Power Sector, and IGES List of Grid Emission Factors were used.

            	2025 tCO2eq	2024 tCO2eq	tCO2eq	Change	%
            Gross Scope 2 GHG emissions - market-based method	11,171	23,795	-12,624	-53.05%

            The reduction in gross Scope 2 location-based GHG emissions between the two reporting periods is mainly due to the lower emission coefficient for 2025 compared with the previous year. This reduction generally reflects current trends occurring in various countries, where the level of emissions is linked to factors such as the use of more or less polluting energy sources, the direction of national policies and changes in energy demand.

            The reduction in gross Scope 2 market-based GHG emissions between the two reporting periods is mainly due to:

            • overall reduction in production, and thus in consumption, during 2025 compared to 2024;

            • Dutch subsidiary Smit Draad ceased trading in the first half of 2025;

            • increase in certified renewable energy occurred in 2025.

         3. Total GHG emissions

            The following table shows the total GHG emissions, distinguishing between:

            • total GHG emissions derived from the underlying scope 2 GHG emissions measured by the position-based method; and

            • total GHG emissions derived from the underlying scope 2 GHG emissions measured by the market-based method.

            Total GHG emissions

            	2025 tCO2eq	2024 Change tCO2eq tCO2eq %
            Gross Scope 1 and 2 GHG emissions - location-based method	22,330	31,289 -8,859 -28.63%
            Gross Scope 1 and 2 GHG emissions - market-based method	14,512	27,378 -12,866 -46.99%

         4. GHG emissions intensity in relation to net revenue

            The following table shows the Group's GHG emission intensity (total GHG emissions compared to net revenue), in metric tonnes of CO2eq calculated using the Location-based and Market-based method, with respect to net revenues.

            GHG emissions intensity in relation to net revenue

            	2025 Value	2024 Value	Change Value %
            Gross Scope 1 and 2 GHG emissions - location-based method (tCO2eq)	22,330	31,289	-8,959	-28.63%
            Gross Scope 1 and 2 GHG emissions - market-based method (tCO2eq)	14,512	27,378	-12,866	-46.99%
            Net revenues (€/000)	377,643	397,654	-20,011	-5.03%
            Location-Based Scope 1 + 2 GHG intensity (tCO2eq - €/000)	0.059	0.079	-0.020	-24.85%
            Market-Based Scope 1 + 2 GHG intensity (tCO2eq - €/000)	0.038	0.069	-0.030	-44.19%

            The net revenues used for the calculation of emission intensity coincide exactly with the net revenues shown in the consolidated income statement under "Revenues".

   3. POLLUTION
      1. Identification and assessment of relevant pollution-related impacts, risks and opportunities

         In the double materiality analysis, both Group activities, considering the location of its plants, and activities along the entire value chain, upstream and downstream, were examined to ensure an integrated approach in identifying impacts, opportunities and material aspects related to pollution. In particular, an actual negative impact related to the generation of other significant air emissions and the use of hazardous and highly hazardous substances was determined as material. In the process of analysing the impact materiality, local governments were involved in the assessment of impacts on various aspects, including the environment. For more information regarding the double materiality analysis conducted, please refer to section 1.10. Double Materiality Analysis.

         There are actual negative impacts related to the generation of significant air emissions and the use of hazardous substances and substances of very high concern, as these practices can cause pollution of the surrounding environment, compromising air, water and soil quality. In this context, IRCE focuses on reducing the use of substances of concern and phasing out those of high concern, while still guaranteeing the performance of the finished product. In addition, the company applies the best available techniques to contain pollution. However, no changes to the company strategy have been made or are currently planned.

      2. Pollution-related policies

         To date, the IRCE Group has not yet formalised a specific policy on pollution. This is mainly due to the complexity of fully integrating this policy into its business model and the need to allocate adequate resources to ensure its effective implementation. However, the Imola plant has an Environmental Policy in place which sets out the management's commitment to preventing pollution in all environmental sectors, particularly those relating to air, water and soil, including through prevention and control, and to minimising the use of substances of concern and phasing out substances of very high concern, whilst ensuring the performance of the finished product.

         1. Actions and resources related to pollution policies

The main measure undertaken and planned to achieve the goals and objectives relating to pollution concerns the Imola plant and the newly established Czech subsidiary Irce S.r.o., and is summarised in the table below. This initiative, which was completed in 2025, is aimed at reducing air pollution. Further projects and investments completed in 2025 are listed below, and the organisation's ongoing commitment to seeking out less hazardous products (enamels, solvents, raw materials) is highlighted, with the aim of progressively reducing the use of substances of very high concern (SVHCs) in the production process.

17 Investments made during 2024 in respect of expenditure incurred on assets under construction.

18It should be noted that, at present, the financial resources allocated to the described initiative are not significant.