ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR 2025
(January 1, 2025 - December 31, 2025)
PAPOUTSANIS S.A. Public Limited Industrial and Commercial Company of Consumer Goods Registration No. GEMI 121914222000 | 71st Km Athens-Lamia National Road, Vathi Avlidos, Chalkida
Table of Contents
DECLARATION OF MEMBERS OF THE BOARD OF DIRECTORS PURSUANT TO ARTICLE 4, PARAGRAPH 2(C) OF LAW 3556/2007 3
MANAGEMENT REPORT OF THE COMPANY'S BOARD OF DIRECTORS OF THE COMPANY IN ACCORDANCE WITH ARTICLES ARTICLES 150 AND 153 OF LAW 4548/2018 AND ARTICLE 4, PARAGRAPHS 6 AND 7 OF LAW 3556/2007 4
EXPLANATORY REPORT TO THE ANNUAL GENERAL MEETING OF SHAREHOLDERS IN ACCORDANCE WITH ARTICLE 4, PARAGRAPHS 7 AND 8 OF LAW 3556/2007 32
CORPORATE GOVERNANCE STATEMENT PURSUANT TO ARTICLES 152 AND 153 OF LAW
4548/2018 & PURSUANT TO ARTICLE 18 OF LAW 4706/2020 38
Independent Certified Public Accountant's Report 64
Audit Committee Activity Report 73
FINANCIAL STATEMENTS 76
Statement of Financial Position 76
Statement of Comprehensive Income (by Function) 77
Statement of Changes in Equity 78
Statement of Cash Flows (Indirect Method) 79
Notes to the Financial Statements 80
General Information 80
Summary of Significant Accounting Policies 80
Financial Risk Management 102
Segment Information 109
Notes to the Financial Statements 112
Property, Plant, and Equipment 112
Investment Property 114
Intangible Assets 115
Financial assets measured at fair value through the statement of comprehensive income
. 117
Long-term receivables 117
Inventories 117
Trade and Other Receivables 118
Cash and cash equivalents 120
Share Capital 120
Fair value reserves 121
Other reserves 121
Loans 122
Deferred taxes 123
Provisions for employee benefits 126
Provisions 127
Asset grants 127
Suppliers and other liabilities 129
Sales 130
Cost of Sales 130
Other Operating Income 130
Other Operating Expenses 131
Expenses by category 131
Financial expenses - net 132
Income Tax 133
Earnings per share 133
Dividends/Interim Dividends 134
Employee Compensation and Expenses 134
Depreciation and amortization 135
Contingent liabilities, receivables, and commitments 135
Transactions with Related Parties 135
Events after the balance sheet date 136
DECLARATION OF MEMBERS OF THE BOARD OF DIRECTORS PURSUANT TO ARTICLE 4, PARAGRAPH 2(C) OF LAW 3556/2007
Pursuant to Law 3556/2007 regarding "Transparency requirements for information concerning issuers whose securities have been admitted to trading on a regulated market and other provisions," we, the undersigned, hereby declare that to the best of our knowledge:
The Annual Financial Statements for the fiscal year 2025 (01.01.2025 - 31.12.2025) which have been prepared in accordance with applicable accounting standards, present fairly the assets and liabilities, equity, and results of operations of PAPOUTSANIS S.A., in accordance with the provisions of Law 3556/2007.
The Annual Management Report of the Board of Directors of PAPOUTSANIS S.A. presents a true and fair view of the information required under Law 3556/2007.
Vathi Avlidas, March 16, 2026
THE PRESIDENT OF THE BoD THE MANAGING DIRECTOR MEMBER OF THE BoD
GEORGIOS GATZAROS MENELAOS TASSOPOULOS MARY ISKALATIAN
MANAGEMENT REPORT OF THE COMPANY'S BOARD OF DIRECTORS OF THE COMPANY IN ACCORDANCE WITH ARTICLES ARTICLES 150 AND 153 OF LAW 4548/2018 AND ARTICLE 4, PARAGRAPHS 6 AND 7 OF LAW 3556/2007
The Board of Directors of Papoutsanis S.A. (the Company) presents the Annual Management Report on the Annual Financial Statements for the fiscal year ended December 31, 2025, which has been prepared in accordance with the relevant provisions of Law 4548/2018, as currently in force, Law 3556/2007, and the implementing decisions of the Board of Directors of the Hellenic Capital Market Commission issued pursuant thereto. This report constitutes a single report pursuant to Article 153(4) of Law 4548/2018.
The above-mentioned Financial Statements have been prepared in accordance with International Financial Reporting Standards.
Evolution and performance over the reporting period
The Company's Turnover amounted to €79,9 million, compared to €66,2 million in 2024, marking an increase of 21%.
During the 2025 fiscal year, there was an improvement in all of the Company's profitability ratios. More specifically, gross profit amounted to €29,4 million compared to €24,7 million, an improvement of 19% thanks to the significant increase in turnover and the completion of the robust investment plan from previous years. As a result, a significant reduction in manufacturing costs and spare capacity (approximately 50% on average) has been achieved, which is essential for further Turnover growth through new agreements and the expansion of existing ones, as there is the potential to offer higher-quality products at competitive prices. At the same time, the limited production capacity and the age of existing facilities across Europe have strengthened opportunities for Papoutsanis in this direction.
The gross profit margin in 2025 remained at the same level as in 2024, at 37%, despite the increase in raw material prices. Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to €11,4 million, representing an 8% improvement compared to 2024.
Earnings before taxes amounted to €7 million, or 9% of turnover, an improvement of 16%. Finally, net profit after taxes amounted to €6,2 million, an 18% improvement. The increase in net profit was also driven by the utilization of tax exemptions under Law 4399/2016 following the completion of investment programs.
In 2025, the Company significantly strengthened its liquidity, improving its operating cash flow by
€6 million and reducing bank debt by €4 million.
2025
2024
Change
Sales
79.855.194
66.199.508
21%
Gross profit
29.351.950
24.690.394
19%
Earnings Before Interest, Taxes,
Depreciation, and Amortization (EBITDA)
11.392.902
10.587.411
8%
Profit before tax
7.030.093
6.052.380
16%
Profit after tax
6.215.371
5.273.523
18%
Turnover - sales
In 2025, the Company's Turnover reached €79,9 million (compared to €66,2 million in the corresponding period of 2024), marking a 21% increase. Exports continued to be a key driver of growth, accounting for 55% of total Turnover.
Regarding the contribution of the Company's four business segments, Turnover breakdown for 2025 was as follows:
32% from sales of branded products in Greece and abroad,
13% from sales to the hotel market,
42% from contract manufacturing,
13% from industrial sales of specialty soap bases.
The Company's strong Turnover growth stemmed both from the expansion of existing partnerships and the development of significant new ones, as well as from the further strengthening of branded products, with targeted expansion into new categories and channels in both the domestic and international markets.
Turnover by product category was as follows, compared to the previous fiscal year:
BRANDED PRODUCTS: The branded products category recorded strong growth of 31% compared to 2024, reflecting the dynamic expansion of the product portfolio and the Company's successful entry into new home care categories.
Specifically, sales in the Home Care categories doubled in 2025, thanks to the positive consumer response to Papoutsanis' innovative products. At the same time, traditional Personal Care categories continued their upward trend, recording a 7% increase in 2025 compared to 2024.
HOTEL PRODUCTS: In 2025, the hotel products category was 7% lower overall compared to 2024.
It is worth noting that Papoutsanis branded hotel products continued their positive trend, recording a 15% increase, with sales growth both in the domestic market (+14%) and abroad (+19%). The overall picture of the category was mainly affected by reduced activity in the production of hotel products for third parties, a development linked to changes in the product portfolio of specific customers.
THIRD-PARTY PRODUCTS (INDUSTRIAL SALES, PRIVATE LABEL): Sales in the category recorded impressive growth of +38% compared to 2024, as a result of the expansion of existing partnerships and the addition of new customers, confirming Papoutsanis' role as a reliable international manufacturing partner.
INDUSTRIAL SOAP SALES: Sales of soap bases decreased by 7%, a trend attributed primarily to the product mix of the industrial soap bases sold, as volume increased by 7%. At the same time, new commercial partnerships are being established, which are expected to support the performance of this segment in the forthcoming period.
Gross Profit
Gross profit in 2025 amounted to €29,4 million, compared to €24,7 million in 2024, representing an increase of 19% mainly driven by the significant growth in Turnover and the completion of the robust investment plan from previous years. The gross profit margin remained stable compared to 2024 and stood at 37%.
Operating Expenses
The Company's sales, administrative, and research and development expenses amounted to €21,5 million in 2025, compared to €17,3 million in 2024, representing a 24% increase. The increase is mainly attributable to distribution expenses, as a significant portion of these consists of variable costs that are directly influenced by the sales volume of branded products. Sales of branded products increased by 31%, which contributed to the corresponding increase in these expenses.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to €11,4 million compared to €10,6 million in 2024, an increase of 8%. Where EBITDA is the sum of earnings before taxes, net financial costs, depreciation, and amortization of grants.
Results
The Company's profit before tax amounted to €7,0 million, compared to €6,1 million in 2024, an increase of 16%. Profit after tax amounted to €6,2 million, compared to €5,3 million in 2024, an increase of 18%.
Operating cash flows
Operating cash flow amounted to €10,7 million, compared to €4,7 million in 2024, representing a significant improvement (128% compared to the previous period).
Debt
Net debt (bank loans minus cash and cash equivalents) decreased by 18% in 2025 and amounted to €18,4 million compared to €22,3 million in 2024, partially attributed to the reduction in inventory holding days.
Fixed assets
The net book value of fixed assets (tangible and intangible assets held for own use) amounted to
€55,5 million as of December 31, 2025, compared to €53,7 million as of December 31, 2024. Financial Structure
The total debt-to-equity ratio improved to 1,3 as of December 31, 2025, compared to 1,6 as of December 31, 2024.
Working Capital-Liquidity
Working capital (current assets minus current liabilities) as of December 31, 2025, amounted to
€4,2 million, compared to €4,6 million as of December 31, 2024.
Alternative Performance Measurement Indicators (APMIs)
The Company uses Alternative Performance Measurement Indicators (APMIs) in the context of decision-making regarding its financial, operational, and strategic planning, as well as for the evaluation and disclosure of its performance. These APMIs contribute to a better understanding of the Company's financial and operational results, its financial position, and its cash flow statement. Alternative performance measures (APMIs) should always be considered in conjunction with financial results prepared in accordance with IFRS and in no way replace them.
2025 2024
General Liquidity
(Current Assets / Short-Term Liabilities) × 100
119%
121%
The ratio reflects the percentage of current liabilities covered by total
current assets
Inventory Turnover
(Inventory / Cost of Goods Sold) × 365 days
87
98
The ratio reflects the average number of days that inventory is held by the
Company.
Trade Receivables Turnover
(Trade Receivables / Sales) × 365 days
33
40
The ratio represents the average number of days it takes for the
company's receivables to be collected.
Short-Term Trade Payables Turnover
(Suppliers / Cost of Goods Sold) × 365 days
96
108
The ratio reflects the average number of days it takes to settle the
Company's short-term trade liabilities.
Gross Profit Margin
(Gross Profit / Sales) × 100
37%
37%
The ratio represents gross profit as a percentage of sales
Net Profit Margin
(Net Profit / Sales) × 100
8%
8%
The ratio represents net profit after taxes as a percentage of sales.
Capital Burden
(Liabilities / Equity) × 100
133%
157%
The ratio reflects the level of Liabilities (short-term and long-term) as a
percentage of equity.
Net Debt
Long-Term Loans + Short-Term Loans - Cash and Cash Equivalents
18.351.118
22.259.646
Earnings Before Interest, Taxes, Depreciation, and
Amortization (EBITDA)
Earnings before interest, taxes, and depreciation
11.392.902
10.587.411
The ratio represents the sum of earnings before taxes, net financial expenses, depreciation, and amortization of grants
Other significant information for the fiscal year ended December 31, 2025 Company Properties
In 2025, the Company proceeded with the sale of building facilities to the Municipality of Athens, as well as the purchase of a plot of land in Ritsona, Evia. The overall picture of the real estate holdings is presented in the following table:
ADDRESS
AREA
(in sq.
m.)
USE
Parcel of land in Ritsona, Euboea
(on which the factory is located)
36.476
For owner-occupancy
Agricultural plot in Ritsona, Evia
4.888
For personal use
Agricultural plot in Ritsona, Evia
2.920
For personal use
Agricultural plot in Ritsona, Evia
2.898
For personal use
Agricultural plot in Ritsona, Evia
868
For personal use
Agricultural plot in Ritsona, Evia
8.406
Owner-occupied
Main facilities in Ritsona, Evia
16.603
Own use
Farm in the Prefecture of Evia
141.692
Investment property held for
capital appreciation
Agricultural plot in Ritsona, Evia
2.416
Own-use
Agricultural plot in Ritsona, Evia
4.023
For personal use
Agricultural plot in Ritsona, Evia
1.019
For personal use
Agricultural plot in Ritsona, Evia
291
For personal use
Plot of land in Aspropyrgos, Attica
13.663
Owner-occupied
Facilities in Aspropyrgos, Attica
2.135
Own use
Agricultural land in Ritsona, Euboea
5.097
Own-use
There are no liens on the properties.
Activities in the Research and Development Sector
The Company's Research and Development department serves as a guide in the development of the Company's activities. To this end, the Company systematically invests in equipment, recruits specialized staff to the team, and obtains the most appropriate certifications.
The Research and Development team is engaged in the creation of various products, including bar soaps and liquid cosmetics, with a strong emphasis on sustainability as expressed through the use of natural raw materials, the development of corresponding natural formulations, the vertically integrated production of the required packaging materials (bottles and caps) using recycled and recyclable raw materials wherever possible, and finally, the acquisition of relevant certifications. These products, as they align with current and/or anticipated consumer trends, are available to the Company for its own branded products as well as to third-party clients for the development of their own.
Examples of these include solid cosmetics (shampoos, conditioners, creams, etc.) as well as synthetic soap bases (syndets) as part of efforts to reduce plastic use and conserve water, thereby lowering the carbon footprint. Examples include melt-and-pour soap bases, liquid olive oil soaps, hot-fill technology, etc., or products in different shapes, recognizing the trend toward new and innovative packaging formats.
Branches
The Company does not maintain branches.
3 Risks and uncertainties Macroeconomic Environment
The international macroeconomic environment is characterized by increased uncertainty and volatility, because of the combined impact of geopolitical tensions, restrictive monetary policy, and a slowdown in global economic activity. Central banks largely maintained a tight monetary stance aimed at countering inflationary pressures despite interest rate cuts in early 2025, a development that influenced investment and consumer decisions.
At the same time, ongoing geopolitical conflicts and disruptions in international supply chains continue to affect global trade and energy costs. In the Eurozone, economic activity showed modest growth rates, while inflation, although moderating from the high levels of previous years, remained above central banks' targets. In this context, companies are called upon to operate in an environment of shifting demand and intensifying geopolitical risks, shaping their strategies with the aim of maintaining their competitiveness and financial resilience.
The Company's Management systematically monitors developments to be able to take appropriate measures, either through alternative partners in the logistics sector or by developing alternative supply sources.
Price variation risk
The primary raw materials used in production are vegetable oils, as well as raw materials for plastic production such as PET, polyethylene (HDPE), and polypropylene (PP). The price of vegetable oils fluctuates according to supply and demand in the global market, as they are traded commodities. Similarly, the prices of raw materials for plastic production depend on energy costs combined with the associated transportation costs between different regions of the world. Due to increased competition in the industry, any increases in international and domestic raw material prices are not always passed on to the final product price, which carries the risk of a negative impact on the Company's results.
The Company addresses these risks through:
passing on the corresponding increases to final products to the extent possible,
an organized program to reduce production costs, supported by the completion of the robust investment plan from previous years,
and finally, in collaboration with its customers and supported by the Research and Development department, redesigning, where feasible, the various products manufactured to reduce their costs while maintaining their high-quality standards.
The Company annually seeks out and ultimately uses the supplier that offers the best price, thereby reducing the risk of dependency. Furthermore, it continuously monitors the prices of raw materials and enters into relevant agreements with its suppliers.
Derivatives are not used to hedge this risk, although medium-term contracts are entered into when deemed advantageous.
The Company performs sensitivity analyses of its results to changes in raw material prices. It is estimated that if raw material prices were to increase by 0,5%, the Company's profitability would have been affected by 198 thousand euros in 2025 and 161 thousand euros in 2024.
Credit risk
Trade receivables consist primarily of receivables from large corporate groups (domestic supermarket chains, multinational companies) and companies operating in the hotel sector. To mitigate credit risk, the Company continuously monitors the financial condition of its debtors and maintains a credit insurance policy. In 2025, no bad debts were recorded.
The table below presents the breakdown of trade receivables, after the estimation of expected credit losses:
2025
2024
Balance within the credit period
7.184.079
7.196.053
Balance beyond the credit period
65.298
10.763
Total
7.249.377
7.206.816
The movement in the allowance for impairment of trade receivables is presented below:
Balance as of 01.01.2024
(217.973)
Provision for credit losses for the period
(41.862)
Balance as of 31.12.2024
(259.835)
Reversal of provision for losses for the period
17.413
Balance as of 31.12.2025
(242.422)
Interest rate risk
Interest rate risk consists of the possibility that the fair value of a financial instrument's future cash
flows may fluctuate due to changes in market interest rates.
Starting in 2024, the European Central Bank cut its key interest rate by 1 basis point following the increases of previous years, while in 2025 it proceeded with a further reduction of 1 basis point, which led to a decrease in the Company's borrowing costs.
The Company does not use relevant instruments to hedge against the risk of changes in the Euribor.
The interest expense on the Company's total bank debt is variable and based on Euribor. The bank debt is denominated exclusively in euros.
Interest Rate Risk Sensitivity Analysis
The sensitivity analysis illustrates the sensitivity of earnings after taxes and equity to reasonable possible changes in interest rates through their impact on borrowings and deposits. These changes are considered reasonably possible based on an observation of current market conditions.
The calculations are based on a change in the average market interest rate for each reporting period and on the Company's loan obligations as of each reporting date, while all other variables are held constant.
It should be noted that the methods and assumptions used have not changed from the previous period. The following changes are considered reasonably possible based on an observation of current market conditions.
Impact on pre-tax profits
2025
2024
Increase of 50 basis points
(108.699)
(130.076)
Decrease by 50 basis points
108.699
130.076
Increase of 100 basis points
(217.398)
(260.152)
Decrease of 100 basis points
217.398
260.152
Impact on equity
2025
2024
Increase of 50 basis points
(84.785)
(101.459)
Decrease of 50 basis points
84.785
101.459
Increase of 100 basis points
(169.570)
(202.919)
Decrease of 100 basis points
169.570
202.919
Foreign exchange risk
The Company's transactions in foreign currency are limited. There are no significant receivables or liabilities in currencies other than the euro. Therefore, there are no circumstances that could expose it to high foreign exchange risk.
Liquidity risk - Cash Flow risk
Liquidity risk management involves ensuring the availability of sufficient cash and cash equivalents, as well as maintaining creditworthiness through adequate credit lines from partner banks.
According to these financial statements, the Company has positive working capital and positive cash flows from operating activities and, consequently, does not face any significant liquidity risk. In addition, the Company maintains additional credit lines to cover periods of increased cash
requirements during the year, with the result that liquidity and cash flow risk is not considered significant.
The maturity of financial liabilities based on estimated undiscounted contractual cash outflows as of December 31, 2025, and 2024, respectively, is as follows:
2025
Short-term Long-term
years
Up to 1 year 1 to 5 years >5
Borrowing
4.447.628
19.747.035
-
Finance lease liabilities
308.690
468.276
1.450
Trade and Other Liabilities
17.396.619
-
-
Undiscounted liabilities
22.152.938
20.215.311
1.450
2024
Short-term
Up to 1 year
Long-term
1 to 5 years
>5 years
Borrowing
5.843.491
23.186.620
-
Finance lease liabilities
318.976
586.924
-
Trade and Other Liabilities
15.487.812
-
-
Undiscounted liabilities
21.650.279
23.773.544
-
The expected collection period for impaired accounts receivable is presented in the following table:
2025
2024
Less than 6 months
7.184.079
7.196.053
Between 6 months and 1 year
65.298
10.763
Total
7.249.377
7.206.816
Climate Change Risk
For Papoutsanis, the concept of sustainable development is intertwined with responsible action and initiatives aimed at protecting the environment, while ensuring the Company's long-term prosperity. Therefore, we aim to achieve a balance between environmental, social, and economic aspects in all matters during the decision-making process. The Company maintains a high level of environmental awareness and is committed to environmentally friendly production that conserves resources, as well as to the development of innovative, high-quality products that conserve water and energy, with eco-friendly packaging design. Papoutsanis's ultimate goal is to actively contribute to mitigating climate change and, as such, it identifies risks and opportunities arising from climate change that may lead to changes in the Company's operations, the Company's earnings and expenses.
Risks:
Extreme weather events may cause disruptions in the supply chain and problems in internal production, threatening business continuity.
Available water resources are constantly decreasing, particularly during periods of drought and high temperatures (e.g., summer months).
Risk mitigation:
Selecting suppliers operating in the domestic market to keep supply chains short.
Strengthening the Company's infrastructure to ensure the safety of products and
production systems and the health of employees.
Continuous investment in water conservation and reuse infrastructure.
Going Concern
Management is responsible for assessing the Company's ability to continue as a going concern, disclosing, where applicable, matters related to going concern. The assessment did not reveal any events, conditions, or related business risks that could cast significant doubt on the Company's ability to continue as a going concern in the next fiscal year.
Significant Events that Occurred after the End of the Financial Year
At the end of February, geopolitical developments occurred in the Middle East, which have already begun to affect energy, raw material, and transportation prices. The extent of the impact will
depend largely on the duration and intensity of these developments. Management is closely monitoring the situation and taking the necessary measures and initiatives to mitigate potential impacts.
Objectives and Outlook - Projected Course
The external factors affecting the environment in which Papoutsanis operates remain volatile. Current geopolitical conditions in the Middle East have already impacted the prices of raw materials, energy, and transportation. The extent of their impact will depend on the duration of these events. In this context, the Company has developed strategies and tactics to further improve profitability and Turnover, such as:
Increasing the competitiveness and flexibility of our facility in Ritsona, as a result of the completion of our three-year investment plan, which ensures:
significant excess production capacity (50% on average), enabling new partnerships and limiting investments for the next 2-3 years,
a reduction in production costs thanks to state-of-the-art equipment, which allows us to offer competitive prices to our customers and improve profitability,
prioritizing sustainable growth through the installation of photovoltaic systems, which are operational from December 2024, helping to reduce our environmental footprint while further improving production costs.
Expanding the share of Papoutsanis branded products-both consumer and hospitality-in
the Company's total Turnover by:
dynamic growth in major new markets (home care) with the aim of increasing the penetration and market share of our branded consumer products,
a focus on innovation and sustainability with new offerings and solutions that provide a competitive advantage to our branded product lines in Greece and abroad.
Onboarding of new key clients in the contract manufacturing category while simultaneously expanding our customer base.
Supporting and empowering the Company's people:
Continuous training and development of our workforce's skills.
A flat and effective organizational structure that enables speed and flexibility.
Attracting and retaining talent in strategic positions within the Company.
Ensuring financial strength and sustainable growth on a solid foundation and creating value for all stakeholders:
restructuring and streamlining expenses,
limiting borrowing by optimizing the parameters that affect it (inventories, trade receivables, liabilities, and investment control).
Management intends to propose to the Annual General Meeting of Shareholders the distribution of a minimum gross dividend of €0,09 per share, including the amount of €0,04 per share that has already been distributed to the Company's shareholders as an interim dividend in October 2025.
As of March 16, 2026, the Company, as part of its share buyback programs, holds 264.380 shares, representing 0,976% of the Company's share capital.
The Company's shares are listed on the main market of the Athens Stock Exchange.
Business Outlook
Papoutsanis' management expects the Company to continue to post double-digit Turnover growth and further improve its overall profitability in 2026, based on:
new partnerships and the further development of existing ones,
the continued strengthening of branded products, as well as
developments in the European production landscape, with the reduction of production facilities, a trend that creates opportunities and is expected to bring new partnerships to Papoutsanis in the contract manufacturing and soap base categories.
For 2026, in the branded products sector, the change in how commercial partnership discounts are applied to selected retail customers should also be taken into account. The agreed discount percentage will be applied by issuing a credit note to the customer rather than through an invoice, as was the case until 2025. This change will affect sales in the financial statements, but will result in a corresponding reduction in Distribution Expenses, without impacting the Company's final profitability.
Breakdown by business segment:
The Papoutsanis branded products segment is a strategic priority and is expected to maintain its dynamic growth in 2026 as well, through the expansion of the personal care product range, and
greater penetration into the home care category with new products. Furthermore, exports of our branded products are projected to increase in 2026.
The hotel products sector is expected to remain at 2025 levels, as international developments and instability in the Middle East may affect the initially positive forecasts for domestic tourism. At the same time, we continue to actively build on our long-standing partnerships with strategic clients abroad, while a strong foundation has been laid for the expansion of exports of our branded hotel products into a range of new markets.
Finally, the contract manufacturing and specialty soap bars segments are expected to continue growing, primarily through expanding our customer base and further developing the range of products we produce for these customers, as well as the development of synthetic soap bases.
Transactions with Related Parties
Intercompany transactions None.
Intercompany balances None.
Transactions with key management personnel and members of the Board of Directors
01.01.2025-
01.01.2024-
31.12.2025
31.12.2024
Remuneration of executive members of the Board of Directors and senior executives (based on a special employment contract)
620.557
756.758
Remuneration of non-executive members of the Board of Directors
73.800
65.868
694.357
822.626
Receivables and liabilities with executives and members of management
Receivables from executives and members of management from performance-based accounts
Liabilities to executives and members of management arising from performance-based accounts
Liabilities to executives and members of management (from compensation)
31.12.2025 31.12.2024
508 504
- 111
9.324 189.655
Balance with shareholders None.
Description of the company's policies regarding the environment, corporate social
responsibility, and labor.
Environmental issues
Actual and potential impacts of the entity on the environment
Respect for and protection of the natural environment are a key element of Papoutsanis' corporate philosophy. In this context, the Company has established and implements an environmental policy aimed at complying with European and national environmental legislation related to factory operations and energy consumption.
More specifically, our Company's environmental policy is based on the following principles: Compliance with applicable legislation
Its operations are in full compliance with existing European and national environmental legislation, while the emission limits set forth in the environmental permit issued for the Company's facilities are always adhered to.
Responsible Operation
It has full knowledge of the environmental impacts of the production process and takes all necessary measures to minimize them, as well as appropriate measures to prevent environmental risks.
Collaboration with certified contractors
The Company's partners in waste management (collection, transport, recovery, disposal) hold all
necessary permits and follow proper management practices in accordance with relevant legislation. Continuous improvement
The Company's goal is to continuously improve its environmental performance and reduce the
environmental footprint of its activities. Transparency
The Company engages in an open dialogue on environmental issues with all its stakeholders, including governmental and non-governmental organizations, academic institutions, local communities, and the broader public.
Education
The Company's staff is informed and actively participates in environmental management issues, as the Company's goals can only be achieved with the participation of all its employees.
To this end, the Company:
Has modernized its equipment and redesigned its production process with the aim of reducing energy consumption.
The electricity consumed by the Company comes mainly from renewable energy sources, and by the end of 2024, the installation and operation of photovoltaic systems had been completed, covering approximately 36% of the Company's needs.
It uses recycled and recyclable materials for product packaging.
It launches new sustainable products that promote the principles of the circular economy.
Takes measures to prevent any environmental pollution.
Has adopted a recycling program in collaboration with licensed solid waste management companies.
Implements waste sorting during the production process.
It complies with environmental standards set by the applicable legal framework and commissions certified laboratories to conduct analyses.
It has a wastewater treatment facility.
It prioritizes health and safety while upholding human rights and ethical standards in the workplace.
Additionally, the Company is committed, through its Code of Ethics and Business Conduct, to reducing the environmental footprint of its operations and business activities. Through the development of initiatives and the continuous improvement of environmental management, the Company contributes to the protection of the environment and quality of life in the regions where it operates. Furthermore, it is committed to full compliance with all environmental legislation, including obtaining and maintaining all permits and approvals required for its business operations, the proper handling, storage, and disposal of materials in accordance with relevant legislation, and the timely and accurate submission of required reports to the competent government agencies.
The following emerged as material sustainability issues in the context of the updated materiality
analysis conducted by the Company and constitute Papoutsanis' priorities:
Sustainable sourcing of raw materials
Evaluation of suppliers regarding their compliance with environmental, social, and corporate governance standards
Ensuring product safety and high quality
Management of the company's business affairs and decision-making processes
Sound water management practices and the elimination of water depletion
Universal respect for human rights and strengthening of existing corporate ethics
Adapting the Company's activities to combat the global phenomenon of climate change
Taking measures and making decisions in line with a transparent, ethical, responsible, and moral business model
Reducing energy consumption and replacing conventional energy sources with renewable and green forms of energy
Investment in human resources and their appropriate development through training and specialization
Ensuring appropriate conditions to safeguard the occupational health and safety of stakeholders
Ensuring the Company's strong financial performance
In August 2025, Papoutsanis won the EcoVadis Silver Medal for the second consecutive year, ranking it among the top 15% of companies worldwide evaluated by the organization. This
distinction highlights the company's commitment to sustainable development practices, with
particularly strong performance in the Environmental pillar.
Energy and Greenhouse Gas Emissions
Through the following practices, the Company aims to help reduce its environmental footprint and, to that end, implements energy-saving measures:
Use of electric vehicles by Company executives, which are charged using chargers installed at the Company's facilities. The goal is the gradual replacement of all conventional vehicles with electric ones.
Acquisition of Guarantees of Origin (GOs) for energy from renewable sources.
Installation and operation of a net metering photovoltaic system for the generation of energy from renewable sources.
Addition of a new 500 m² warehouse for soapstock
Purchase of new, high-energy-efficiency equipment and machinery for soap stock production and soap molding
Heat recovery from air compressors and use of hot water for office heating.
Natural gas savings through optimization of the soap base production process.
External thermal insulation of masonry and installation of double-pane windows in the office building.
New 2,000 m² warehouse with pallet racks for automated storage of packaging materials
and finished products
Replacement of panels in the existing warehouse to improve insulation
Installation of a synthetic soap production line to ensure sustainable development by reducing plastic packaging.
Regular maintenance of equipment and machinery such as mixers, extruders, and presses on the production line, pumps, valves, filters, air compressors, and control panels, drying and packaging units, and steam boilers.
The Company's building infrastructure, including offices and production facilities, consumes energy from direct and indirect sources. Its production facilities account for the largest share of the Company's energy consumption. Specifically, the primary energy source for soap manufacturing is natural gas. The energy needs for other activities are met by electricity, while in the event of power outages from the grid, backup diesel generators are used.
As part of its ongoing monitoring of energy performance, the Company systematically tracks consumption through monthly reports from electricity and natural gas suppliers as well as internal daily measurements.
The Company recognizes the importance of identifying, quantifying, and mitigating greenhouse gas emissions to ensure the possibility of achieving carbon neutrality at the organizational, national, and EU levels.
The Company complies with National Climate Law 4936/2022 by submitting an annual emissions report related to its activities, starting in 2023 for the previous year's emissions. In full compliance with the specifications and requirements of the National Climate Law, the Company is committed to reducing its total Scope 1 & 2 greenhouse gas emissions by at least 30% by 2030 compared to 2019 levels, and has already achieved a reduction in this regard. In December 2025, the Company submitted its Compliance Report (Report on the carbon footprint of the base year and the emissions reduction plan, Article 19, Law 4936/2022), outlining the specific emission reduction actions to achieve the target.
Water Management
Water is an integral part of the Company's production process and is used for both production and for cleaning, washing, and disinfecting mechanical equipment. The water consumed at all facilities comes from a well and is temporarily stored in intermediate tanks, which ensure a continuous water supply and water self-sufficiency.
The Company acknowledges that the operation of the plant, as well as the entire production process, has impacts on water resources, primarily related to water consumption.
In this context, the plant has installed a reverse osmosis unit to treat the water used in production. To conserve water, a second reverse osmosis unit was added, which uses the wastewater from the first unit to operate the boiler room.
Given the importance of effective water management and reducing water consumption, the Company has automated the production of cosmetic batches to improve productivity and the management of water and materials. In the same vein, the Company has installed an automated CIP (Clean-in-Place) cleaning system in production to reduce water consumption.
Finally, the Research and Development Department focuses on new product technologies that use minimal water. Products such as solid shampoo and Olivia Thinks solid body wash have already been introduced to the hotel market. These products have a significantly reduced environmental footprint compared to their bottled counterparts, as the bars use fewer packaging materials, contain
no plastic, and have a small volume and weight, reducing transportation and storage costs, while their production requires less energy.
As part of responsible management and reduction of water consumption at its facilities, the Company also recognizes the importance of the disposal and impacts of wastewater generated by the plant's operations. The Company treats wastewater from washing liquids and mother liquors at its biological treatment plant, which is then discharged as surface water at the quality required by law.
Raw materials and packaging materials
The raw materials and packaging materials used in the production and packaging of a product are a decisive factor in its quality, safety, and environmental and social footprint. This has led many industries, including those producing soaps and cosmetics, to shift toward more sustainable solutions by utilizing raw materials certified according to international standards that meet specific environmental and social criteria, as well as the use of recycled and recyclable packaging materials that minimize the products' negative impact on the environment.
In this direction and as part of its quality policy, Papoutsanis invests in the creation of innovative products, including their packaging, produced from responsible raw materials. Key raw materials used in the Company's production process include various types of oils, chemicals, fragrances, and paper and plastic materials for packaging production. Detailed information for fiscal year 2024 is available in the Sustainability Report on the Company's website (see note 7.3)
Raw Material Certifications
Given that the Company uses large quantities of various oils in the production of its soaps, it is a member of and holds certification from the Roundtable on Sustainable Palm Oil (RSPO), a global initiative comprising stakeholders in the palm oil value chain that promotes its environmental and social sustainability, and is also a member of the GreenPalm program under the same initiative.
In addition, the Company offers cosmetic lines certified by ECOCERT (COSMOS ORGANIC and COSMOS CERTIFIED) and Ecolabel, which are produced using raw materials of natural and organic origin. At the same time, the Company avoids sourcing raw materials containing substances harmful to human health and the environment (e.g., parabens, triclosan, etc.), while the majority of raw materials do not contain ingredients of animal origin, thereby ensuring the certification of products as vegan.
Packaging Materials
The Company monitors developments in the field of packaging materials that include recycled materials and is a pioneer in testing and implementing such environmentally friendly packaging materials. For example, the Company sources cardboard boxes made from recycled packaging materials for storing products shipped to its customers.
Regarding the raw materials used to produce product packaging, the materials are made from recycled and recyclable PET (polyethylene terephthalate), PE (polyethylene), and PP (polypropylene), while no PVC (polyvinyl chloride) is used at all.
The Company systematically invests in solutions that reduce the environmental footprint of its products. All new product lines are designed with 100% recyclable packaging, which contains a significant percentage of recycled plastic. At the same time, emphasis is placed on the use of biodegradable materials and the development of refill systems to limit the consumption of new plastic and strengthen the circular economy.
Furthermore, product packaging is a key element of the Company's marketing strategy, as it provides essential information about the products and their quality. At the same time, product packaging provides adequate protection to maintain product quality during transport and storage.
Procedure and criteria for selecting suppliers of raw materials and packaging materials
The Company has established a Code of Conduct, which it ensures is sent to suppliers and partners, urging them to adhere to it throughout their collaboration. Overall oversight of supply chain processes is the responsibility of the Company's procurement department. The selection of partners is based on criteria regarding the quality of candidates' infrastructure and services, which also determine the establishment of long-term collaborative relationships.
In this context, a significant percentage of the Company's suppliers maintain commercial or professional relationships with the Company and have incorporated clauses addressing environmental issues, labor issues, and human rights, thereby promoting sustainability throughout the supply chain.
Solid waste and packaging waste
Limiting and reducing the Company's environmental footprint, as well as full compliance with applicable legislation regarding the management, storage, transport, recycling, and disposal of waste, are core commitments of Papoutsanis.
Recognizing the potential negative impacts on both the environment and human health resulting from the irresponsible management of solid waste generated by its operations, the Company sorts the waste generated by its offices and production process and collaborates with licensed companies for its collection and treatment. The Company's partners in waste management
(collection, transport, recovery, disposal) hold all necessary permits and follow proper management practices in accordance with relevant legislation.
The packaging of the Company's products is designed to preserve product quality and reduce Papoutsanis's environmental footprint. The packaging design is based on reducing the amount of plastic used, without compromising the safety and quality of the products. Regarding packaging waste, the plastics production department reuses and recycles the raw material generated by the shredder that would otherwise go to waste, thereby reducing waste production and contributing to the conservation of natural resources.
In 2024, Papoutsanis obtained ISO 14001, an international standard for the implementation of an Environmental Management System in any organization.
The primary objective of ISO 14001 is the proactive management of an organization's environmental impacts through commitments to pollution prevention, legal compliance, and continuous improvement. Certification of the Environmental Management System (EMS) in accordance with the ISO 14001 standard helps organizations demonstrate their ongoing commitment to improving their environmental performance. The standard was revised in 2015 and updated in 2021 to ensure that its objectives and purpose support the growing needs of today's world and reflect the increasingly complex environment in which organizations operate.
Labor Issues
Respect for Employee Rights
The Company views diversity as a fundamental right of its employees and as a source of its strength. Based on this principle, it ensures equal opportunities and combats discrimination through the selection, appointment, and compensation of all individuals who work for or collaborate with the Company based on their qualifications and suitability for the work to be performed, and not on criteria of race, religion, national origin, ethnicity, color, gender, age, nationality, sexual orientation, marital status, physical disability, or any other characteristics. At the same time, the Company prohibits sexual and any other form of harassment of its employees by anyone in the workplace.
Papoutsanis promotes a work environment that respects and protects human rights. At the same time, it monitors labor legislation, including provisions regarding child labor and respect for human rights, and is in full compliance with these provisions.
The cornerstone of the Company's responsible operations is the Code of Conduct, in which the Company commits to complying with applicable legislation regarding child labor. Specifically, in Greece, child labor is defined as the employment of any person under the age of fifteen (15); however, the Company is committed to not employing anyone under the age of sixteen (16).
In addition, by implementing its Whistleblowing Policy, the Company encourages the reporting and documentation of human rights violations, whether by name or anonymously, either through the Whistleblowing app-which is freely accessible to everyone via the company website- or through a suggestion box, by both employees and suppliers or partners. It then evaluates these reports and takes the necessary measures to mitigate and eliminate them, where deemed necessary.
The following are among the key issues related to the Company's broader economic and social
impacts on Sustainable Development:
Consumer Health and Safety
Employment, education, and employee development
Occupational Health and Safety
Human rights and equal opportunities
Financial performance
Employment, training, and employee development
The Company complies with and is in full accordance with labor laws, while the basis of its approach to employment is described in detail in the Code of Conduct, which is also available on its website.
More specifically, the Company has developed and implements a series of procedures related to the management of employment and employee training by the human resources department. Specifically, the following procedures are implemented:
Induction program for new employees (induction plan).
An evaluation process, which takes place once a year.
Training and development process.
Process for providing products to staff.
Procedures for conducting hiring and exit interviews.
Candidates are sought through the Company's website, which is linked to the Human Resources Department's electronic management system, and each job posting is simultaneously published on most job boards.
Following the initial screening of the list, an interview process is conducted, consisting of three stages. All selections are made on a merit-based basis, ensuring transparency and equal treatment of candidates. Candidates are evaluated using predetermined, objective, and merit-based criteria
and assessment standards. Following the final selection, the Company places great emphasis on the integration of new employees, following a thorough onboarding process.
To ensure the development and improvement of its employees' skills, the Company provides ongoing training starting from the employee's hiring and continuing throughout their employment with the Company on topics related to both their specific role and the Company's legal obligations (e.g., training in antiseptic preparation, GDPR training, handling and storage of hazardous materials), as well as additional skills (e.g., positive leadership, verbal and non-verbal communication, business English, Executive Coaching), which are identified as needs following the completion of the annual performance review.
Training focuses on current work, the immediate needs of the business, and the future development of employees. Training plays a vital role for our Company, as without it, it would not be possible to achieve its goals, and it is taken seriously as an activity that shapes its future. The training strategy we follow focuses on development through opportunities for personal growth, adaptation to the workplace, and an emphasis on individuals' leadership skills. Training is conducted either internally by the Company's qualified staff or through training centers in the form of seminars or long-term programs. The stages of training are defined as follows:
Identification of the required knowledge and skills
Identification of current knowledge levels
Identifying training needs and preparing the program
Training methods, as well as the location and timing of the training
Evaluation of employees after the completion of training regarding the knowledge or skills they have acquired in their field of work.
Regarding employee benefits, the Company provides the following list of benefits, which are offered to all staff regardless of contract type:
Private insurance program
Daily lunch and fresh juice for all employees
Bonus payments
Staff transportation
Gifts for employees' children / Christmas party
Various types of allowances
Awards for employees' children for their successful admission to universities or technical colleges
Free distribution of products to all staff.
Occupational health and safety
The protection of all employees and partners, as well as full compliance with applicable health and safety laws, is the Company's top priority.
The Company's employees and partners must respect and comply with the health and safety policies and standards established by the Company. These include not only legal obligations but also best practices in the industry to which the Company belongs, in order to ensure a healthy and safe work environment while also caring for customers and visitors at its facilities. For example, these practices include:
Providing information and training to its workforce so they can effectively perform their duties, and to contractors, for whom, in fact, specific safety measures are applied, as defined by a specific procedure, and to others working on behalf of the Company, to ensure their commitment and awareness. In this context, it is emphasized that all new employees, during their orientation training, are made aware of the Company's safety rules, as well as personal protective measures for work in production. In addition, they are informed about the maintenance of emergency response systems and plans, which are monitored through regular drills.
The integration of health, safety, and environmental protection issues into business decisions, plans, and the operation of the Company's facilities, within the framework of the Integrated Management System.
Setting targets for the continuous improvement of health, safety, and environmental management systems.
The assessment of risks arising from the Company's activities or the activities of contractors
with whom the Company collaborates, and their elimination or reduction to acceptable levels.
In addition, the Company's health and safety policy includes:
Monitoring compliance with the above practices in all workplaces.
Ensuring the availability of necessary resources.
Evaluating and reporting on safety performance.
Conducting audits of the implementation of relevant standards and procedures.
The policy is evaluated and revised as necessary at regular intervals. To manage employee health and safety, our Company has a cooperation agreement with an external partner who provides a Safety Technician and an Occupational Physician, with responsibilities related to preventive matters concerning the health and safety of staff.
Furthermore, the Company is SMETA (SEDEX MEMBERS ETHICAL TRADE AUDIT) certified. SMETA is an audit developed by Sedex, the non-profit organization for the exchange of ethical data on suppliers, with member companies committed to the continuous improvement of their performance within the context of their supply chains.
Sustainability Reports
Papoutsanis has established and implements a sustainable development policy, and regularly monitors the progress of the indicators it has set.
The Sustainability Reports published by the Company are available on its website (Sustainability Reports < SUSTAINABLE DEVELOPMENT | Papoutsanis).
In October 2025, the 2024 Sustainability Report was published, and the 2025 Sustainability Report will be published in 2026.
EXPLANATORY REPORT TO THE ANNUAL GENERAL MEETING OF SHAREHOLDERS IN ACCORDANCE WITH ARTICLE 4, PARAGRAPHS 7 AND 8 OF LAW 3556/2007.
This explanatory report of the Board of Directors is submitted to the Company's Annual General Meeting of Shareholders pursuant to paragraph 8 of Article 4 of Law 3556/2007, and has been prepared in accordance with the provisions of paragraph 7 of Article 4 of the aforementioned law.
Share Capital Structure
The Company's share capital amounts to fourteen million six hundred thirty-three thousand two hundred forty euros and seventy-six cents (€14.633.240.76), divided into twenty-seven million ninety-eight thousand five hundred ninety-four (27.098.594) common registered voting shares, with a par value of 0.54 euros each.
The Company's shares are listed for trading in the General Category (Main Market) of the Athens
Stock Exchange.
The Company's shares are common registered shares with voting rights. Each share carries all the rights and obligations provided for by law and the Company's Articles of Association. Shareholders' liability is limited to the par value of the shares they hold.
Restrictions on the Transfer of Company Shares
The transfer of the Company's shares, which are dematerialized and listed for trading in the General Category (Main Market) of the Athens Stock Exchange, is carried out as provided by law, and there are no restrictions on their transfer under the Articles of Association.
Significant direct or indirect holdings within the meaning of Articles 9 through 11 of Law 3556/2007
The shareholders (natural or legal persons), or the controlling persons who, based on their declaration as of December 31, 2025, hold directly or indirectly a percentage equal to or greater than 5% of the total number of shares and the corresponding voting rights, within the meaning of Articles 9 through 11 of Law 3556/2007, are listed in the table below:
Full Name or Business Name of Shareholder
/Controlling Person
Shares Held (in units)
Percentage
Menelaos Tassopoulos
6.313.129
23.30%
Gatzaros Georgios
6.142.217
22.67%
TRUAD VERWALTUNGS AG
5.726.302
21.13%
3K ANONYMOUS INVESTMENT COMPANY
1.670.390
6.16
No other natural or legal person holds a stake exceeding 5% of the Company's share capital as of
the aforementioned date.
Mr. Menelaos Tassopoulos holds a total of 23.30% of the Company's voting rights, of which he directly controls 4.09% of the Issuer's voting shares and, indirectly, through the wholly-owned company SAPON, 19.21%.
Truad Verwaltungs AG, in its capacity as administrator of a foreign private discretionary trust established for the benefit of the present and future members of the family of the late Anastasios Georgios Leventis (the "Trust"), controls 5.726.302 voting rights (corresponding to 21,13% of the total number of voting rights of the Company) through its control of Torval Investment Corp., which controls Thrush Investment Holdings Ltd, which controls: (a) directly, 5.407.065 voting rights, corresponding to 19,95% of the Company's total voting rights; and (b) indirectly, through its control of Eagle Enterprises S.A., 319.237 voting rights, corresponding to 1.18% of the total number of the Company's voting rights.
The percentage of voting rights controlled by "3K Anonymous Investment Company" in the Company amounts to 6.16% of the total voting rights of the Company's shares as of December 31, 2025 (corresponding to 1.670.390 common, registered, voting shares of the Company). "3K Anonymous Investment Company" holds 100% of the share capital of "3K Investment Partners Single-Member Mutual Fund Management Company," a company that manages the mutual funds "3K Domestic Equity Fund," "3K Greek Value Domestic Equity Fund," and "NN HELLAS Equity Fund," which hold (as direct shareholders) shares of the Company. Mr. Georgios Koufopoulos is a controlling person of "3K Anonymous Investment Company," within the meaning of Article 3, paragraph 1c, subparagraph (dd) of Law 3556/2007.
Holders of shares conferring special control rights
There are no shares of the Company that grant their holders special control rights.
Restrictions on voting rights - Deadlines for exercising relevant rights
The Company's Articles of Association do not provide for any restrictions on voting rights arising
from its shares.
Shareholder Agreements Regarding Restrictions on the Transfer of Shares or the Exercise of Voting Rights
The Company is not aware of any shareholder agreements that entail restrictions on the transfer of shares or restrictions on the exercise of voting rights.
Rules for the appointment/replacement of Board of Directors members and the amendment of the Articles of Association, to the extent that they differ from the provisions of Law 4548/2018.
The rules set forth in the Company's Articles of Incorporation regarding the appointment/replacement of members of the Board of Directors and the amendment of the relevant provisions of the Articles of Incorporation do not differ from those provided for in Law 4548/2018. Specifically, pursuant to Article 7, paragraph 3 of the Company's Articles of Association, the following provisions apply in the event of a vacancy on the Board of Directors:
"ARTICLE 7
Election and Replacement of a Member of the Board of Directors (Art. 81 of Law 4548, codified by Law 5255/2025)
[…]
If a vacancy arises for a Member or Members, for any reason:
If there is a substitute Member or substitute Members elected by the Company's General
Meeting, they shall fill the vacant position or positions in the order of their election.
If there are none, the Board of Directors may either continue to manage and represent the Company, provided that the remaining Members exceed half of the total number of Members prior to the vacancy of the position or positions, but in any case, such members may not be fewer than three, or, provided that the remaining Members are at least three (3), elect a replacement Member or replacement Members to fill the vacancy or vacancies and for the remainder of the term of the Member or Members being replaced. This election shall be announced at the next regular or extraordinary General Meeting, which may replace the elected members, even if no such item is listed on the agenda. The choice between the two solutions mentioned in subparagraph (b) above is made by the Board of Directors at its sole discretion. The Board of Directors may, of course, replace only some of the vacant positions, provided that, following the partial replacement, the number of Members exceeds half of the total number of Members prior to the vacancy of the position or positions. The election decision shall be made public and announced by the Board of Directors at the next General Meeting, which may replace the elected members even if no such item is listed on the agenda."
The choice between the two solutions set forth in subparagraph (b) above is made by the Board of Directors at its sole discretion.
Authority of the Board of Directors to issue new shares / repurchase treasury shares pursuant to Article 49 of Law 4548/2018 (codified by Law 5255/2025)
Pursuant to the provisions of Article 24(1)(b) of Law 4548/2018, the Company's Board of Directors has the right, following a relevant resolution of the General Meeting subject to the publicity formalities of Article 13 of Law 4548/2018, to increase the Company's share capital by issuing new shares, by a resolution adopted by a majority of at least two-thirds (2/3) of all its members. In this case, the share capital may be increased in accordance with the applicable Law 4548/2018 up to three times the amount of capital paid in as of the date on which the General Meeting granted the Board of Directors the aforementioned authority. The aforementioned authority of the Board of Directors may be renewed by the General Meeting for a period not exceeding five years for each renewal. No such decision has been taken by the General Meeting of Shareholders.
Pursuant to the provisions of Article 113 of Law 4548/2018, by a resolution of the General Meeting, adopted by an enhanced quorum and majority, a share distribution program may be established for members of the Board of Directors and the Company's staff, as well as for affiliated companies within the meaning of Article 32 of Law 4308/2014, in the form of stock options, under the terms of this resolution, a summary of which shall be made public. The resolution of the General Meeting shall specify, in particular, the maximum number of shares that may be issued, which may not exceed 1/10 of the existing shares, as well as the price and terms of offering the shares to the beneficiaries. The Board of Directors, by resolution, regulates any other relevant details not addressed by the General Meeting, issues the stock option certificates, and the shares to the beneficiaries who have exercised their rights, increasing the share capital accordingly and certifying such increase, in accordance with Article 113, paragraph 3, of Law 4548/2018. Furthermore, pursuant to Article 113(4) of Law 4548/2018, the Board of Directors may, upon relevant authorization - a resolution of the General Meeting adopted by an increased quorum and majority and made public, to establish a share issuance program, potentially increasing the capital and taking all other relevant decisions. This authorization is valid for five (5) years, unless the General Meeting specifies a shorter period of validity, and is independent of the powers of the Board of Directors under paragraph 1 of Article 24 of Law 4548/2018. The decision of the Board of Directors is taken in accordance with the provisions of Article 113 of Law 4548/2018.
In accordance with the above provisions:
the Company's Board of Directors, on February 18, 2022, and following the authorization granted by the Ordinary General Meeting of May 05.2021, adopted a share distribution program for the benefit of executives who provide services to the Company on a permanent basis, in the form of stock options, in accordance with the applicable regulatory framework. The duration of the program was set at two years, meaning that the options granted to beneficiaries may be exercised until June 2024, in accordance with the specific terms of the program. The number of rights available under the program may amount to two hundred sixty-nine thousand sixty (269.060) for the entire duration
of the program. The Company's share capital will be adjusted accordingly in the event that new shares of the Company are allocated to the beneficiaries and in accordance with the rights exercised by the beneficiaries, by resolution of the Company's Board of Directors as provided by law and the terms of the program. The detailed terms of the program have been posted on the Company's website (https://www.papoutsanis.gr).
This program was completed on June 30, 2024, without any rights being exercised.
In accordance with the provisions of Article 113(4) of Law 4548/2018, a resolution was adopted on April 17, 2024, by the Annual General Meeting, pursuant to which the Board of Directors was authorized to establish a share distribution program in the form of stock options (stock options) under such terms and conditions within the framework of the law as the Board of Directors deems appropriate, but subject to the following restrictions:
the options to be granted shall correspond to a maximum of 2% of the Company's total shares, provided that this maximum limit shall be adjusted in the event of corporate actions that, without new contributions, result in a change in the total number of shares
the shares to be offered will result from an increase in the Company's share capital or
from treasury shares.
As of the publication of the annual financial report, no stock option plan has been established pursuant to the resolution of the Annual General Meeting.
In accordance with the provisions of Articles 49 and 50 of Law 4548/2018, as currently in force, following approval by the General Meeting, the Company may acquire treasury shares, under the responsibility of its Board of Directors, provided that the par value of the shares acquired, including shares previously acquired and held by the Company, does not exceed 1/10 of its paid-in share capital. The resolution of the General Meeting must also specify the terms and conditions of the proposed acquisitions, and in particular the maximum number of shares that may be acquired, the duration for which the authorization is granted, which may not exceed twenty-four (24) months, and, in the case of acquisition for consideration, the minimum and maximum limits of the acquisition price.
On May 18, 2023, the Ordinary General Meeting approved the Company's share buyback program, pursuant to Article 49 of Law 4548/2018, pursuant to which the Company shall be entitled, within the 24-month period provided for by law, i.e., from May 18, 2023, to May 18,2025, to purchase treasury shares amounting to up to 5% of the Company's total paid-in share capital, which as of May 18, 2023, corresponded to 1,354,929 shares. The maximum purchase price for the
Company's treasury shares was set at four euros (€4) per share and the minimum purchase price at one euro (€1) per share, while it was stipulated that the treasury shares to be acquired may be disposed of in any manner permitted by law. This treasury share purchase program was adopted by the Company's Board of Directors on May 18, 2023.
On April 24, 2025, the Ordinary General Meeting approved the Company's share buyback program, pursuant to Article 49 of Law 4548/2018, pursuant to which the Company shall be entitled, within the 24-month period provided for by law, i.e., from April 24, 2025, through April 24,2027, to purchase treasury shares amounting to up to 5% of the Company's total paid-in share capital, which as of April 24, 2025, corresponded to 1.354.929 shares. The maximum purchase price for the Company's treasury shares was set at five euros (€5) per share and the minimum purchase price at one euro (€1) per share, while it was stipulated that the treasury shares acquired may be disposed of in any manner permitted by law. This share buyback program was adopted by the Company's Board of Directors on May 20, 2025.
Under the above programs, as of December 31, 2025, the Company held a total of 264.380 treasury shares, representing 0,98% of the Company's total shares.
Significant agreements of the Company that take effect, are amended, or expire in the event of a change in control of the Company following a tender offer.
There are no material agreements that take effect, are amended, or terminated in the event of a change in control of the Company following a tender offer.
Compensation agreements for members of the Board of Directors or employees in the event of resignation/dismissal without just cause or termination of term of office/employment due to a tender offer
There are no agreements between the Company and members of its Board of Directors or its staff which provide for the payment of compensation in the event of resignation or dismissal without just cause or termination of their term of office or employment due to a public tender.
CORPORATE GOVERNANCE STATEMENT PURSUANT TO ARTICLES 152 AND 153 OF LAW
4548/2018 & PURSUANT TO ARTICLE 18 OF LAW 4706/2020
This Corporate Governance Statement is prepared in accordance with Articles 152 and 153 of Law 4548/2018, as in force, and Article 18 of Law 4706/2020, as in force.
TABLE OF CONTENTS INTRODUCTION
Corporate Governance Code
Declaration of the Company's Voluntary Compliance with the Corporate Governance Code
Deviations from the Corporate Governance Code and justification thereof. Specific provisions-practices of the Code for listed companies-that the Company does not apply and explanation of the reasons for non-application
Corporate governance practices implemented by the Company in addition to legal requirements
Key Features of the Internal Control and Risk Management Systems in Relation to the Process of Preparing Financial Statements and Financial Reports
General
Safeguards in the financial statement preparation process
Board of Directors
Composition and Functioning of the Board of Directors
Information on the Members of the Board of Directors
Board of Directors evaluation process
Audit Committee
Compensation and Nominating Committee
Other Management, Supervisory Bodies, or Committees of the Company
Diversity Policy regarding the composition of the Company's administrative, management, and
supervisory bodies
Procedure for compliance with the obligations arising from Articles 99 to 101 of Law 4548/2018
Policy on the Suitability of Members of the Board of Directors
Internal Control System Assessment Report
Corporate Governance System Assessment Report
Sustainability Report
Remuneration of Board Members
Information required under Article 10(1)(c), (d), (f), and (h) of Directive 2004/25/EC regarding takeover bids
INTRODUCTION
The term "corporate governance" describes the way in which companies are managed and controlled. Corporate governance is structured as a system of relationships between the Company's Management, the Board of Directors, shareholders, and other stakeholders; it constitutes the framework through which the Company's objectives are identified and set, the means to achieve these objectives are determined, and the performance of management is monitored during the implementation of the above.
In Greece, the corporate governance framework has been developed primarily through the adoption of mandatory rules, such as Law 4706/2020, as amended and currently in force, which, among other things, require the participation of non-executive and independent non-executive members on the Boards of Directors of Greek companies whose shares are listed on a regulated market in Greece, the establishment and operation of an internal audit unit and the adoption of internal operating regulations with minimum mandatory content in accordance with the above provisions. Furthermore, other legislative acts have incorporated European company law directives into the Greek legal framework or implemented European regulations, creating new corporate governance rules, such as Law 4449/2017, which mandates, among other things, the operation of an audit committee.
Finally, the Law on Public Limited Companies (Law 4548/2018) sets forth the basic rules of corporate governance for public limited companies.
Corporate Governance Code
Disclosure of the Company's Voluntary Compliance with the Corporate Governance Code
The Company has decided to adopt the Greek Corporate Governance Code of the Hellenic Corporate Governance Council (HCGC) for Listed Companies (hereinafter referred to as the "Code"). This Code is available on the HGC website at the following URL: https://www.esed.org.gr/web/guest/code-listed.
In addition to the Hellenic Capital Market Commission's website, the Code is available to all staff in printed form at the Finance Department and the Human Resources Department, as well as on the Company's official website at the following web address:https://www.papoutsanis.gr/el/sxeseis-ependyton/etairiki-diakuvernisi-2/kodikas-etairikis-diakuvernisis_130794/