1 April 2026 - Financial Statements of Recordati S.p.A. at 31 December 2025 and related Report of the Auditing Firm

ANNUAL REPORT

2025

RECORDATI S.p.A.

This document in PDF format does not comply with the obligation arising from

1

the ESEF Regulation.

Company subject to management and co-ordination by Rossini Luxembourg S.à.r.l.

Registered Office: 1 Via Matteo Civitali, Milan Fully paid-up share capital: € 26,140, 644.50

Tax identification number and Milan Company Registration No. 00748210150

The Company prepares the consolidated financial statements for the Recordati Group.

BOARD OF DIRECTORS

Elected by a Shareholders' Meeting dated 29thApril 2025, in office until the date of the Shareholders' Meeting held to approve the 2027 Annual Report.

ANDREA RECORDATI

Chairman

ROBERT KOREMANS

Chief Executive Officer

DIVA MORIANI Lead Independent Director

STEPHEN SANDS Independent

LUIGI LA CORTE

JOANNA LE COUILLIARD Independent

GIAMPIERO MAZZA

PIERGIORGIO PELUSO Independent

CATHRIN PETTY KIM STRATTON

BOARD OF STATUTORY AUDITORS

Elected by a Shareholders' Meeting dated 21stApril 2023, in office until the date of the Shareholders' Meeting held to approve the 2025 Annual Report.

ANTONIO SANTI

Chairman

EZIO SIMONELLI SILVIA MINA

Statutory Auditors

ANDREA BALELLI

Alternate auditor

INDEPENDENT AUDITORS

EY S.p.A. Engaged by a Shareholders' Meeting of 29th

April 2020 for the financial years 2020-2028.

CONTENTS

REVIEW OF OPERATIONS 4

FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31STDECEMBER 2025 14

NOTES TO THE FINANCIAL STATEMENTS 25

CERTIFICATION IN RESPECT OF THE FINANCIAL STATEMENTS 98

To our Shareholders,

The annual report of Recordati Industria Chimica e Farmaceutica S.p.A. (hereinafter also the "Company" or "Recordati") for the year ended 31stDecember 2025, which we submit to you for your approval, reports net income of € 317,587 thousand.

The items in the reclassified income statement which shows costs by function are given below with the relative percentage of revenue(1)and the change compared with the previous year:

(1) The item also includes other revenue of € 126 thousand (€ 192 thousand in 2024), mainly related to training grants and rents, which are classified in Note 4 to the financial statements under "Other revenue and income".

Net revenue came to €613.4 million, down €65.7 million, or 9.7%, compared with €679.1 million in the

previous year.

Net sales of products amounted to €544.8 million, down €48.3 million, or 8.1%, compared with €593.1 million in the previous year. This change is mainly attributable to lower sales to subsidiaries in Europe of corporate products, particularly in the cardiovascular sector.

Revenues from services and royalties amounted to €68.6 million, down €17.4 million, or 20.2%, compared with €86.0 million in the previous year.

The fall in this item compared with the previous year is mainly attributable to lower balances charged to subsidiaries relating to transfer price adjustments to products, made for compliance with the arm's length principle.

See note 3 to the financial statements for further details.

The cost of sales amounted to € 263.2 million, down € 5.7 million compared on the previous year due to lower sales volumes. The increase in the cost of sales as a percentage of net revenue, which rose from 39.6% to 42.9%, was a result of a change in the mix of sales revenues compared with the same period in the previous year.

Selling expenses amounted to € 90.7 million (14.8% of net revenue), up € 1.9 million (2.2%) compared with expenses incurred in the previous year. The change is attributable to higher promotional expenses and other selling costs incurred designed to respond more effectively to the development of the business model and to fully exploit market opportunities, notwithstanding the reduction in personnel costs after the commercial reorganisation of the Specialty & Primary Care sector that took place last year.

R&D expenses came to € 79.0 million, accounting for 12.9% of net revenue, up € 4.6 million (6.2%) compared with the expenses incurred in the previous year. The change is the result of personnel costs and other costs incurred to strengthen corporate units to support ongoing projects and geographical expansion.

General and administrative expenses amounted to €88.2 million, accounting for 14.4% of net revenue, an increase of €2.7 million (3.1%) compared with expenses incurred in the previous year.

Other net income and expenses showed a net cost of € 30.7 million and were mainly due to: the recognition of costs of € 12.8 million relating to the payback for Urorec® following a ruling by the Council of State dated 3rdSeptember 2025; costs incurred for ongoing improvements to the sales force of the Specialty & Primary Care sector totalling € 8.6 million; € 6.1 million of write-downs of intangible assets, calculated on the basis of an analyses to determine the recoverability of the value of the asset. The item also reflects a provision for probable costs for remediation work to be carried out at the Campoverde manufacturing site (see notes 7, 8 and 32 to the Financial Statements for further information on other expenses).

Operating profit, amounting to €61.6 million, accounting for 10.0% of net revenue, was down €94.6 million compared with the previous year due to the reduction in gross profit and an increase in other costs and expenses.

Dividends from subsidiaries came to € 344.3 million, up € 61.1 million on 2024 (see note 10 in the notes of

the financial statements for further information).

Net financial expenses amounted to € 88.2 million, down € 20.9 million, (19.1%), compared with the previous year. This change is due mainly to lower interest expense payable to subsidiaries, due to the reduction in debt, as well as to lower interest rates on bank loans (see note 11 to the Financial Statements for further details).

The change in taxes of €9.4 million is the result of a reduction and change in the mix of taxable income

between dividends from subsidiaries and operating and financial results.

Net income was €317.6 million.

A brief summary is given below of the Net Financial Position, while further details are given in note 43 of the Notes to The Financial Statements.

(1) Inclusive of the fair value of derivatives to hedge foreign exchange rate risk (cash flow hedges), recognised within asset item 23 and liability item

35 with an overall net positive impact of € 975 thousand as at 31stDecember 2025.

During the year dividends amounting to € 267.6 million were paid to shareholders, treasury shares worth

€ 112.4 million were purchased, net of sales for the exercise of stock options, and an upfront payment of

$ 25 million was made for the licence and supply agreement with Amarin for the marketing of Vazkepa®.

Capital expenditure on property, plant and equipment came to € 20.7 million and related to investments

regarding the Milan headquarters (€ 8.6 million) and the Campoverde di Aprilia plant (€ 12.1 million).

Free cash flow, i.e. operating cash flow excluding financial components, milestones, dividends and share buybacks net of sales from the exercise of stock options, was negative at € 33.2 million in 2025, down € 151.1 million compared with 2024, mainly due to the decrease in EBITDA and higher interest and income tax payments.

With regard to loans, the Company took out new loans in 2025 amounting to € 470.0 million and made repayments totalling € 451.6 million as follows:

• March saw the full advance repayment amounting to € 28.0 million of the loan from Allied Irish Bank which was disbursed in March 2021 and involved semi-annual repayments of the principal from March 2022 to March 2026;

• in June, the loan of € 180.0 million disbursed in May 2021 was renegotiated through its full repayment ahead of its May 2026 maturity date and a new loan was taken out for € 345.0 million, of which € 280.0 million, net of advisory and up-front fees, disbursed on 30thJune 2025 and the remaining € 65.0 million was disbursed in August;

• in September, the Company repaid in advance the $ 50 million tranche of a bond issued by the Company on 30thSeptember 2014 and in addition to the $ 5 million due under the repayment plan, the remaining $ 10 million due in 2026 was also repaid;

• In September, an agreement was signed with PGIM Inc., Prudential's Investment Manager, for a

$ 220.0 million Note Purchase and Private Shelf Agreement. In detail, the Multiborrower and Multicurrency Shelf Facility agreement grants the Group the right to issue bonds up to a total maximum of $ 220.0 million, or the equivalent in €, over the next three years, with pricing to be set at the time of each single drawdown, a maximum term of 20 years and an average life of 15 years. On 30thSeptember 2025, the Company issued a bond for € 125.0 million with a 10-year maturity on the amount.

R&D

The Company strives to promote continuous innovation for the benefit of patients. At the same time, we continue to pay the utmost attention to the safety of the people who rely on our products and to develop targeted risk mitigation programmes to make new indications available. We also aim to extend the geographical reach of existing products to places where we can really make a difference.

The main R&D activities carried out in 2025 in the Specialty & Primary Care area are summarised in the paragraphs below.

Eligard® (leuprorelin acetate)

The marketing authorisation application for Eligard 7.5 mg, 22.5 mg and 45 mg in the United Kingdom received a positive opinion in December 2025, with approval by the MHRA in January 2026. The new device had already been approved in Russia in May 2025.

Vazkepa® (Icosapent Ethyl)

In June 2025, an agreement was signed with Amarin for the acquisition of Vazkepa. Subsequently, in the fourth quarter of 2025, the procedure for transferring the marketing authorisation in the United Kingdom and Switzerland was completed. In November 2025, the EMA also issued a positive opinion on the renewal of the authorisation for the European Union.

LOMEXIN® (fenticonazole)

In February and July 2025, respectively, the re-registrations of Lomexin 600 mg and 1.000 mg vaginal capsules and Lomexin 2% cream for Russia were also completed, in compliance with the new Eurasian Economic Union regulations. The subsequent mutual recognition application was then submitted in Armenia and Kazakhstan. In September 2025, Belgium authorised the transition from prescription-only to over-the-counter status for the 2% vaginal cream and for the 200 mg and 600 mg vaginal capsules. On the other hand, new registration applications have been submitted for Lomexin 600 mg and 1,000 mg vaginal capsules in Gabon, Burkina Faso, Mali and Madagascar.

Activities involving pharmaceuticals for the treatment of rare diseases

The Company carries out support activities for research carried out by other subsidiaries for which they are charged back on the basis of service agreements. In fact the Group is increasingly more committed to R&D for the development of treatments for rare diseases and it has many pharmaceuticals in its pipeline for treating these illnesses at different stages of development.

RISK DISCLOSURES

With regard to an analysis and description of the principal risks and uncertainties, in its capacity as a holding company, the Company is indirectly exposed to the risks to which its subsidiaries are exposed. Therefore, with regard to "Risks related to the external environment", "Strategic and operational risks" and "Legal and compliance risks", see the relevant paragraphs in the dedicated section "Risk assessment and management" in the Management Report of the consolidated annual report.

FINANCIAL RISKS

A specific analysis of the information required under paragraph 3, point 6-bis of Art. 2428 of the Italian Civil Code concerning the Company's objectives and policies in respect of financial risk management is given here below.

The Company constantly monitors the financial risks to which it is exposed in order to take immediate mitigation action when necessary.

The company aims to achieve a balanced and prudent financial structure as a fundamental condition for financing internal and external growth, thereby reducing financing costs to a minimum, while maximising returns. Speculative investments in shares, funds or financial assets which might impair the value of companies is not permitted.

The only financial investments admissible are investments in risk free assets and/or funds issued by major financial institutions.

The Company monitors the financial risks to which it is exposed in order to take immediate mitigation action, when necessary, in compliance with the applicable legislation and regulations and it transacts only with banks with a strong credit rating.

On the basis of the above and considering that the related effects would not be significant, no sensitivity analysis has been carried out.

As required by IFRS 7, information is given below on the main financial risks to which the Company is exposed.

Credit risk

Credit risk is exposure to potential losses resulting from commercial counterparties failing to meet their obligations, also in relation to the effects of the prolonged period of economic and financial difficulty.

The Company closely controls its credit exposure through the allocation of credit limits to each single customer and an internal reporting system.

As at 31stDecember 2025 the credit exposure is not critical due to the large number of counterparties, their geographical distribution and the average amount of each receivable.

More specifically, it is considered that the allowance for doubtful accounts recognised in the balance sheet, amounting to € 791 thousand, is sufficient in relation to the risk of insolvency. It is underlined that gross trade receivables, inclusive of receivables from subsidiaries, amounted to € 215,417 thousand.

Interest rate risk

The Company raises external funds using debt and invests excess cash in money market funds and other financial instruments. The fluctuation of interest rates influences the cost and returns of the debt and investment instruments therefore affecting the Company's net financial charges.

The Company's policy is to limit the risk arising from interest rate fluctuations by establishing medium to long-term loans at fixed or floating interest rates. Any floating rate loans are promptly hedged by using derivative instruments (e.g. interest rate swaps - IRS), used solely for hedging and not speculative purposes. This hedging policy allows the company to reduce the risk attaching to fluctuations in interest rates (as illustrated in note 27).

Foreign currency risk

The Company is exposed to foreign currency fluctuations which can affect its operating results.

In particular, the Company is exposed to foreign currency fluctuations on its international sales and financing denominated in currencies other than the euro.

The Company also enters into forward contracts for the purchase and sale of currency in order to hedge amounts at risk. It does this for hedging purposes only and not for speculation.

Liquidity risk

The liquidity risk to which the Company could be exposed consists of the inability to raise sufficient funds for its ongoing business and for the development of its industrial and commercial activities. The two main factors which determine the Company's liquidity are, on the one hand, the resources generated or absorbed by operations and by investments, and on the other, the expiry and renewal terms of debt or the degree of liquidity of financial investments and market conditions.

The Company has a supply of readily available liquidity and substantial credit facilities available granted by a number of leading Italian and international banks.

The maturities of the Company's financial assets and its debt are reported in notes 26, 28, 37 and 38 to the financial statements which discuss cash and cash equivalents, medium to long-term borrowings and short-term debt from banks and other lenders. The Group believes that the funds and credit facilities currently available, in addition to those generated by operations and financing activities, are enough to satisfy investment needs, working capital requirements and the repayment of debts on their natural due dates.

CLIMATE CHANGE RISK

As reported in the consolidated management report, the Company recognises a potential risk relating to climate change over a long-term time horizon and it will continue to monitor this potential risk over the years. As concerns the short and medium-term, in view of the sector, the company has currently classified climate change as a risk with no concrete or substantial impacts on the Company's operations.

OTHER INFORMATION

Company is subject to management and co-ordination by Rossini Luxembourg S.àr.l, in accordance with Art. 2497 and following of the Italian Civil Code.

Key figures from the financial statements for the year ended 31stDecember 2024 approved by the company that exercises management and co-ordination are reported in Attachment 6.

Treasury stock consisting of 2,965,916 shares was purchased during the year, for consideration of € 157.1 million and 1,025,570 shares were sold for consideration of € 49.2 million, following the exercise of options under the 2018-2022, 2021-2023 and 2022-2024 stock option plans by Group employees. As at 31stDecember 2025 the Company held 4,769,267 treasury shares in portfolio with a face value of € 0.125 each, accounting for 2.28% of the share capital.

In compliance with the requirements contained in Art. 4, paragraph 7 of the Regulation on related-party transactions adopted with Consob Resolution 17221 of 12thMarch 2010 and subsequent amendments and also in Art. 2391-bis, paragraph 1 of the Italian Civil Code, the Company reports that it has adopted "Regulations for related-party transactions", the full text of which is available on the Company website at www.recordati.it (in the "Corporate Governance" section), as last updated on 17thJune 2021.

For all information on corporate governance, reference is made to the Report on Corporate Governance and Ownership Structure prepared in accordance with Art. 123-bis of the Consolidated Finance Law, approved by the Board of Directors at the same time as it approved the Annual Report. Information pursuant to paragraphs 1 and 2 of Art. 123 bis of Legislative Decree No. 58/1998 is contained in the separate "Report on

Corporate Governance and Ownership Structure", the full text of which is available on the company's website https://www.recordati.it (in the "Corporate governance" section).

Reference is made for "information concerning the environment and personnel" to the Consolidated

Sustainability Statement.

The Company has a secondary headquarters at 4 Via Mediana Cisterna, Campoverde di Aprilia (Latina).

Shares held by directors, statutory auditors, general managers and other key management personnel are reported in the Report on remuneration policies and wages published in accordance with Art. 123-ter of the Consolidated Finance Law.

Reference is made to the information given in the Code of Ethics for details of the principles governing conduct adopted by the Company.

Reference is made to the information given in the Sustainability Statement for details of the company's

approach to sustainability.

Reference is made to note 45 to the financial statements for information required by the Consob (Italian securities market authority) communication dated 28thJuly 2006 on "atypical and/or unusual transactions".

The Management report in the consolidated annual report may be consulted for further information on operating activities, development strategies and the business outlook.

RELATED-PARTY TRANSACTIONS

As at 31stDecember 2025 the Company had a total net debt position of € 7,014 thousand towards Group companies, with credit positions of € 816,735 thousand and debt positions of € 823,749 thousand.

The table below summarises these receivables and payables by nature:

RELATED-PARTY TRANSACTIONS

Receivables Payables Net

Sales, services and royalties to Group companies in 2025 amounted to € 355,336 thousand (€ 422,812

thousand in 2024).

During the year, dividends were declared by Casen Recordati S.L. (€ 123,306 thousand), from Recordati Rare Diseases S.a.r.l. (€ 79,692 thousand), from Recordati AG (€ 53,621 thousand), from Bouchara Recordati (€ 30,000 thousand), from Italchimici S.p.A. (€ 16,821 thousand), from Natural Point S.r.l. (€ 16,000 thousand), from Recordati Ireland Limited ( € 15,000 thousand), from Recordati Romania Srl (€3,952 thousand), from Herbacos Recordati S.r.o (€ 3,201 thousand), from Recordati Polska S.p. z.o.o. (€ 1,998 thousand) and from Opalia Pharma S.A. (€728 thousand).

The following summary is given in the table below in compliance with Consob Resolution No. 15519 of 27th

July 2006:

Transactions and positions with related parties as a percentage of balance sheet items is basically the same as that for the income statement items.

Transactions with related parties are conducted under normal market conditions.

With regard to direct relations during the year with the company that exercises management and coordination, we report that the CEO and some employees of the Recordati Group have been designated as beneficiaries of an incentive scheme, with a vesting period of five years, under which they have purchased shares of Rossini Luxembourg S.àr.l. at face value, an indirect shareholder of Recordati S.p.A., and they will receive a return at the end of the life of the scheme.

With the exception of the previous point, no other direct business was conducted with the company that carries out management and coordination activities.

NON-EUROPEAN UNION SUBSIDIARIES

In relation to the provisions of articles 15 and 18 of the Markets Regulations concerning the conditions for the listing of the parent companies of companies formed and regulated under the laws of countries that do not belong to the EU and which are of significant importance for the purposes of consolidated financial statements, since 31stDecember 2024 the regulatory provisions of Art. 15 of the Markets Regulations have applied to the subsidiaries Recordati Ilaç, Sanayi Ve Ticaret A.Ş., Recordati Rare Diseases Inc., Rusfic LLC Recordati AG and Recordati UK LTD (formerly Eusa Pharma Uk ltd) and the conditions laid down in the aforementioned Art. 15 in relation to which the certification is required from the management body have been satisfied.

SIGNIFICANT TRANSACTIONS, EXCEPTION TO DISCLOSURE OBLIGATIONS

The Company decided to take advantage, with effect from 20thDecember 2012, of the right not to comply with obligations to publish the reports required when significant extraordinary operations are performed consisting of mergers, demergers, share capital increases through contributions in kind, acquisitions and disposals, in accordance with Art. 70, paragraph 8 and with Art. 71, paragraph 1-bis of the Issuers' Regulations issued by Consob with Resolution No. 11971/1999 and subsequent amendments.

BUSINESS OUTLOOK

At the date of preparing the financial statements no corporate events had occurred after the end of the year which might require modifications to be made to the value of assets and liabilities and the amounts in the income statement.

The implementation of company strategies, operations at the beginning of the current year, the potential of our products, the financial strength of the company and the managerial capacities of our personnel lead us to forecast a positive result again in 2026.

We report that, at consolidated level, the market has been informed of continued growth in revenue, EBITDA and Adjusted Net Income, with an expected positive impact also at Company level.

Milan, 19thMarch 2026

on behalf of the Board of Directors the Chief Executive Officer

Robert Koremans

ANNUAL REPORT 2025 RECORDATI S.P.A. REVIEW OF OPERATIONS

14

RECORDATI S.P.A.

INCOME STATEMENTS FOR THE YEARS ENDED 31STDECEMBER 2025 AND 31STDECEMBER 2024

INCOME STATEMENT

Basic earnings per share are calculated on average shares outstanding in the relative periods, consisting of 205,483,735 shares in 2025 and 206,316,241 shares in 2024. The figures are calculated net of average treasury stock held, which amounted to an average of 3,641,421 shares in 2025 and 2,808,915 shares in 2024.

Diluted earnings per share are calculated taking into account rights granted to the beneficiaries of stock option and performance share plans.

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

BALANCE SHEETS AS AT 31STDECEMBER 2025 AND 31STDECEMBER 2024

ASSETS

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

BALANCE SHEETS AS AT 31STDECEMBER 2025 AND 31STDECEMBER 2024

EQUITY AND LIABILITIES

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARS ENDED 31ST

DECEMBER 2025 AND 31STDECEMBER 2024

Basic earnings per share are calculated on average shares outstanding in the relative periods, consisting of 205,483,735 shares in 2025 and 206,316,241 shares in 2024. The figures are calculated net of average treasury stock held, which amounted to an average of 3,641,421 shares in 2025 and 2,808,915 shares in 2024.

Diluted earnings per share are calculated taking into account rights granted to the beneficiaries of stock option and performance share plans.

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEARS

ENDED 31STDECEMBER 2025 AND 31STDECEMBER 2024

€ (thousands) Share

Additional

TreasuryStatutory

Other reserves Revaluation

Interim

Net

Total

capital paid-in capital

stock

reserve

Sundry Reserve for reserves derivatives

Stock option

reserve -Performance shares reserve and/or Other

reserves

dividend(loss)/income

for the year

Performance shares valuation reserve

15.224 15,224

Balance as at 31st December 2025 26,141 83,718 (239,379) 5,228 124,894 (17) 167,080 2,602 (128,783) 317,587 359,071

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

CASH FLOW STATEMENT FOR THE YEARS ENDED 31STDECEMBER 2025 AND 31STDECEMBER 2024

RECORDATI S.P.A.

CASH FLOW STATEMENT FOR THE YEARS ENDED 31STDECEMBER 2025 AND 31STDECEMBER 2024

The notes to the financial statements form an integral part of these financial statements.

RECORDATI S.P.A.

INCOME STATEMENT IN ACCORDANCE WITH CONSOB RESOLUTION NO. 15519 OF 27THJULY 2006

INCOME STATEMENT

RECORDATI S.P.A.

BALANCE SHEET IN ACCORDANCE WITH CONSOB RESOLUTION N. 15519 OF 27THJULY 2006

ASSETS

RECORDATI S.P.A.

BALANCE SHEET IN ACCORDANCE WITH CONSOB RESOLUTION N. 15519 OF 27THJULY 2006

EQUITY AND LIABILITIES

RECORDATI S.P.A.

FOR THE YEAR ENDED 31STDECEMBER 2025

1. GENERAL INFORMATION

   These financial statements as at and for the year ended 31stDecember 2025, have been prepared by Recordati Industria Chimica e Farmaceutica S.p.A. (hereinafter the "Company" or "Recordati"), and they were approved by the Board of Directors on 19thMarch 2026 which authorised their publication.

   Recordati Industria Chimica e Farmaceutica S.p.A. is a listed joint-stock company registered and with service address in Italy. These financial statements are available at the registered address of the Company at 1 Via Matteo Civitali, Milan.

   The Company's activities include the development, production and marketing of pharmaceutical products or of pharmaceutical chemicals. The Company operates in a broad and diverse context which includes general medicine, specialist medicine, self-medication and rare diseases. In addition to being present in the cardiovascular field and in that of hypertension in particular, Recordati is also active in that of urology, with treatments for benign prostatic hyperplasia and male functional disorders, and in psychiatry.

   The annual company financial statements comprise the income statement, the balance sheet, the statement of other comprehensive income, the statement of changes in equity, the cash flow statement and these notes to the financial statements.

   The annual financial statements have been prepared in compliance with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and endorsed by the European Union and also by regulations issued to implement Art. 9 of Legislative Decree No. 38/2005. Details of the accounting standards adopted by the Company are given in note 2 to the financial statements.

   The presentation adopted by the Company for the income statement in the separate company annual financial statements classifies revenues and expenses by nature. The distinction between the principle of current and non-current has been adopted for the presentation of assets and liabilities in the balance sheet. The indirect method was used to prepare the cash flow statement.

   These financial statements are presented in euro (€) and all amounts in the notes to the statements are

   rounded to the nearest thousand euro unless otherwise stated.

   SEGMENT REPORTING

   The Company's only operating segment is the Specialty & Primary Care segment. Furthermore, the pharmaceutical chemicals business is considered an integral part of the Specialty & Primary Care segment because from an organisational and strategic viewpoint it is involved principally in the production of the active ingredients required to produce pharmaceuticals.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

In compliance with Legislative Decree No. 38 of 28thFebruary 2005 (which implements the options provided for by Art. 5 of Regulation (EC) No. 1606/2002 of the European Parliament and Council of 19thJuly 2002 concerning the application of international accounting standards), the annual company financial statements have been prepared by applying the International Financial Reporting Standards (IFRS) issued or revised by the International Accounting Standards Board (IASB) and endorsed by the European Union and also the regulations issued in implementation of Art. 9 of Legislative Decree No. 38/2005. These annual financial statements have been prepared using the same accounting standards as those applied in the last annual financial statements. The Company has not adopted any new standard, interpretation or amendment in advance that has been issued, but is not yet in force.

The financial statements have been prepared on a going concern basis, because the Directors have found no cash flow, operational or other indicators to suggest that the company might face difficulties in its ability to meet its obligations in the foreseeable future and in the next twelve months in particular. Account has been taken of the impacts, and also the potential impacts, resulting from the Russian-Ukraine crisis when making estimates and the related assumptions required to draft this financial report. The Group operates on the Russian market, in compliance with the regulations in force, and on the Ukrainian market with revenues in 2025 amounting to 5.9% and to 0.7% respectively of the Group's total revenue.

The Group constantly monitors developments in the conflict, as well as possible developments in the geopolitical environment and their consequences on business strategies in order to adopt mechanisms to safeguard its competitiveness, investments, performance and resources. The same approach is also adopted to the potential impacts of any changes to US legislation that might affect the pharmaceutical sector.

In view of studies performed when preparing this financial report and also in consideration of the achievement of its expected results in the sector to which it belongs, no factors have been identified to-date which might have any significant impact on the financial statements.

Adoption of new standards

The accounting standards adopted for the preparation of this financial report are consistent with those used for the preparation of the financial report for the year ended 31stDecember 2024, except for the adoption of new standards and amendments effective from 1stJanuary 2025. The Company has not adopted any new standard, interpretation or amendment in advance that has been issued, but is not yet in force.

A description of new standards, interpretations and amendments for which application is mandatory from 1stJanuary 2025 is given below. On the basis of assessments carried out these have had no significant impacts on the annual financial statements as at and for the year ended 31stDecember 2025.

Amendments to IAS 21: Lack of exchangeability

The amendments to IAS 21 "The Effects of Changes in Foreign Exchange Rates" state how an entity should consider whether a currency is exchangeable and how to determine the spot exchange rate when a currency is not exchangeable. The amendments also require disclosure of information that enables users of its financial statements to understand how the currency not being exchangeable into the other currency affects, or is expected to affect, the entity's financial performance, financial position and cash flows.

Standards issued but not yet in force

Standards and interpretations that had already been issued but were not yet in force at the date of preparation of the Company's financial statements are illustrated below. The Company intends to adopt these standards and interpretations, if applicable, when they come into force.

• IFRS 18 - Presentation and Disclosures in Financial Statements

  In April 2024, the IASB issued IFRS 18, which replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new requirements for the presentation of the income statement, including specific totals and subtotals. Furthermore, entities will have to classify all costs and income within the income statement into five categories: operating, investing, financing, income taxes and discontinued operations, where the first three categories are new.

  The standard also requires disclosure based on the new definition of management-defined performance measures (MPMs), subtotals of costs and revenues, and it includes new provisions for the aggregation and disaggregation of financial information based on the identified roles of the primary financial statements (PFS) and notes.

  In addition, amendments have been made to IAS 7 Cash Flow Statements, which include changing the starting point for determining cash flows from operating activities using the indirect method from profit or loss to operating profit or loss and removing the option to classify cash flows from dividends and interest. Furthermore, consequential amendments have been made to several other accounting standards.

  IFRS 18, and amendments to other standards, are effective for financial years beginning on or after 1st January 2027, but early application is permitted but only if disclosed. IFRS 18 will be applied retrospectively.

  The Company is currently working to identify the impacts that the changes will have on its financial statements and notes to the financial statements. Preliminary assessments of the main expected impacts on the Company's balance sheet are as follows:

  • rental income, changes in fair value relating to investment property and the share of profits of a subsidiary and a joint venture will be classified under "investment" in the income statement;

  • foreign exchange differences will be classified within the category in which the related income and expenses that gave rise to the exchange difference were classified and new supplementary information will be introduced with reference to: a) management defined performance measures; b) costs by nature if these costs are presented by function in the "operating" category in the statement of profit/(loss) for the year; c) a reconciliation for each item in the income statement between the amounts restated in accordance with IFRS 18 and those previously presented in accordance with IAS 1;

  • interest income and interest expense will be classified under investment and financing activities, respectively, in the cash flow statement.

• IFRS 19 - Subsidiaries without Public Accountability: Disclosures

  In May 2024, the IASB issued IFRS 19, which allows eligible entities to opt for a reduction in their disclosure requirements while continuing to apply the provisions for recognition, measurement and presentation in other IFRS accounting standards. In order to be eligible at the end of the year, an entity must be a subsidiary as defined under IFRS 19, it must not have "public accountability" and must have a parent company (ultimate or intermediate) which prepares consolidated financial statements, available to the public, drawn up in compliance with IFR accounting standards.

  IFRS 19 will become effective for financial years beginning on or after 1st January 2027, with the possibility of early application.

  As the Company's shares are publicly listed, the Company is not eligible for the application of IFRS 19."

• Amendments to the classification and Measurement of the financial Instruments - Amendments to IFRS 9 and IFRS 7

  In May 2024, the IASB issued amendments to IFRS 9 and IFRS 7, entitled Amendments to the Classification and Measurement of Financial Instruments (the Amendments). The changes include:

  • a clarification according to which a financial liability is derecognised at the "settlement date" and the introduction of an accounting policy choice (if specific conditions are satisfied) to derecognise financial liabilities settled through electronic payment systems before the settlement date;

  • additional guidance on how to assess contractual cash flows for financial assets with environmental, social and governance (ESG) or similar characteristics;

  • clarification on the characteristics of a "non-recourse feature" and which are characteristics

    of contractually linked instruments;

  • the introduction of disclosure requirements for financial instruments with contingent features and additional disclosure requirements for equity instruments classified at fair value through other comprehensive income (OCI).

    The Amendments are effective for annual periods beginning on or after 1stJanuary 2026, with early adoption permitted only for the classification of financial assets and related disclosures.

    The Company does not expect the amendments to have a significant impact on the consolidated financial statements.

• Annual Improvements to IFRS Accounting Standards - Volume 11

  In July 2024, the IASB issued nine limited-scope amendments as part of its periodic maintenance of IFRS. The amendments include clarifications, simplifications, corrections or changes aimed at improving consistency in the following standards: IFRS 1 First-time Adoption of International Financial Reporting Standards, IFRS 7 Financial Instruments: Disclosures and the related Guidance on implementing IFRS 7, IFRS 9 Financial Instruments, IFRS 10 Consolidated Financial Statements and IAS 7 Statement of Cash Flows.

  The amendments will take effect for administrative periods beginning on or after 1st January 2026. Early adoption is permitted, provided that adequate information is provided.

  These amendments are not expected to have a significant impact on the Group's consolidated financial statements.

• Contracts Referencing Nature-depending Electricity - Amendments to IFRS 9 and IFRS 7

  In December 2024, the IASB issued amendments to IFRS 9 and IFRS 7, Contracts Referencing Nature-dependent Electricity. The changes apply solely to contracts that refer to this type of electricity and:

  • they clarify the application of own-use requirements for contracts falling within their scope of application;

  • they modify the requirements for the designation of a hedged item in a cash flow hedge relationship for the contracts in question;

  • they introduce new disclosure requirements to enable investors to understand the effects of such contracts on a company's financial performance and cash flows.

    The amendments will take effect for administrative periods beginning on or after 1stJanuary 2026. Early adoption is permitted, provided that adequate information is provided.

    The amendments relating to the own-use exception must be applied retrospectively, while those relating to hedge accounting must be applied prospectively to new designated hedging relationships from the date of first-time adoption. Furthermore, the amendments to the disclosures required by IFRS 7 must be implemented in conjunction with the amendments to IFRS 9. If an entity does not restate comparative information, it may not present comparative disclosures.

    The Company does not expect these changes to have a significant impact on its financial statements.

    Use of estimates

    The preparation of financial statements requires estimates and assumptions to be made by directors based on the best possible assessments that have an impact on the values of revenue, expenses, assets and liabilities in the balance sheet and disclosure of contingent assets and liabilities as at the balance sheet date. If in the future those estimates and assumptions should differ from the actual circumstances, they shall be modified appropriately in accordance with the changes in the circumstances.

    A brief description is given below of those items in the financial statements which more than others require greater discretion on the part of directors in making estimates and for which a change in the conditions underlying the assumptions used could have a significant impact on financial data.

• Investments in subsidiaries: in compliance with the accounting standards applied, investments in subsidiaries are subject to impairment testing to ascertain whether a reduction in value has occurred, which is recognised with a write-down, when indicators exist which predict difficulty in realising the relative recoverable amount. Testing whether the aforementioned indicators exist requires the directors to make subjective assessments based on information available within the Company and on the market and on historical experience. Furthermore, if it is found that potential impairment may have occurred, the Company proceeds to measure it by using the measurement techniques considered most appropriate. Accurate identification of indicators of potential impairment and estimates to calculate it depend on factors which may change over time thereby influencing assessments and estimates made by the directors.

• Goodwill: according to the accounting standards applied by the Company, goodwill is subject to an annual impairment test to ascertain whether a reduction in value has occurred. That test requires the use of discretionary assessments by directors based on the information available within the Company and on the market as well as on past experience. These assessments also depend on factors which may change over time, thereby influencing assessments and estimates made by Management. Furthermore, if it is found that potential impairment may have occurred, the Company proceeds to measure it by using the measurement techniques considered most appropriate.

• Provisions: in some circumstances the decision as to whether or not a present obligation (legal or constructive) exists is not easy to make. Management assesses these circumstances on a case-by-case basis in combination with an estimate of the funds required to meet the obligation. When Management considers that it is only possible that a liability will arise, then the risks are reported in a special section of the report on commitments and risks without any recognition of a provision.

• Deferred tax assets: recognition must be supported by a plan to recover these assets based on hypotheses and assumptions that Management considers reasonable.

• Inventories: stock that may be obsolete or that has a slow turnover is periodically tested for impairment and is written down where the net realisable value is less than the carrying amount. Write-downs are based on assumptions and estimates resulting from experience and historical results.

• Financial instruments: trade receivables are adjusted by the relative allowances for bad debts to take account of their actual recoverable amount. Calculation of the amount of write-downs requires Management to make subjective assessments with account therefore taken of past events, current conditions and forecasts of future economic conditions.

  Generally, methods for measuring the fair value of financial instruments for accounting or disclosure purposes are summarised below with reference made to the main categories of financial instruments to which they apply:

  • derivative instruments: appropriate pricing models are used based on market values for interest rates;

  • loans and borrowings and unlisted financial assets: the discounted cash flow method (based on the present value of expected cash flows in consideration of current interest rates and credit ratings) is used for financial assets with maturities of greater than one year for measurement of the fair value on first-time recognition. Subsequent recognition is carried out using the amortised cost method;

  • listed financial instruments: the market price as at the reporting date is used.

    IFRS 13 requires the fair value of financial instruments to be measured by classifying them on the basis of a hierarchy of levels laid down by the standard itself, which reflects the degree of observability of the market inputs used in the calculation of the fair value.

    The following levels are identified:

    • Level 1: unadjusted quotations recorded on active markets for assets or liabilities subject to measurement;

    • Level 2: inputs that are not quoted prices as per level 1, but which are observable on the market, either directly (as in the case of prices) or indirectly (i.e. because they are derived from prices);

    • Level 3: inputs that are not based on observable market data.

  Balance Sheet

  Property, plant and equipment - Property, plant and equipment is recognised at historic cost net of the relative accumulated depreciation and any accumulated impairment. Subsequent costs are only capitalised when it is probable that the future economic rewards will flow to the Company. The costs for ordinary maintenance and repairs are recognised through profit or loss at the time at which they are incurred.

  The carrying amount of property, plant and equipment is subject to impairment testing to measure any loss in value when events or situations occur which indicate that the carrying amount of the assets can no longer be recovered (see paragraph on impairment for details).

  Depreciation is calculated on a straight-line basis using rates which are held to be representative of the estimated useful life of the assets:

• Industrial buildings 2.5% - 5.5%

• Plant & machinery 10% - 17.5%

• Other equipment 12% - 40%

The depreciation of an asset begins when it is installed and is ready for use or, in the case of self-constructed assets, when the assets have been completed and are ready for use.

The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in income.

Leases - The Company has applied IFRS 16 using the modified retrospective approach.

Accounting model for the lessee - At the start of a contract or when changes are made to a contract that contains a lease component, the Company allocates the consideration for the contract to each lease and non-lease component on the basis of the relative prices. At the date of inception of a lease contract, the Company recognises a right-of-use asset and a lease liability. The right-of-use asset is initially measured at cost inclusive of the amount of the initial lease liability, adjusted for payments due for leasing carried out at the date of or before the date of inception, plus the direct costs incurred and an estimate of the costs that the lessee will have to bear for disassembly and removal of the underlying assets and to restore the underlying assets or the site in which it is located, net of lease incentives received.

The right-of-use asset is subsequently depreciated on a straight-line basis from the date of inception until the end of the lease contract unless the lease transfers ownership of the underlying asset to the Company at the end of the lease contract or, considering the cost of the right-of-use asset, it is expected that the Company will exercise its purchase option. In this case, the right-of-use asset will be depreciated over the useful life of the underlying asset, calculated on the same basis as that used for property, plant equipment. Furthermore, standard practice is followed to reduce the value of the right-of-use asset for impairment and it is adjusted to reflect any changes resulting from subsequent measurements of the lease liability.