Seco S p A : Consolidated annual report 2025

Contents

1. LETTER TO THE SHAREHOLDERS 4

2. THE GROUP AND ITS OPERATIONS 8

3. DIRECTORS' REPORT 10

   First section 11

   Market overview 12

   Operational overview 13

   Research and Development and Technological Innovation 13

   Operating Performance 15

   Balance Sheet Overview 17

   Financial Information 18

   Alternative performance measures 19

   Risks and uncertainties 21

   SECO on the stock exchange 22

   Outlook 22

   Second Section - Consolidated Sustainability Statement 24

   General disclosures 29

   Environmental information 87

   Social information 112

   Governance information 148

   Entity-specific information 155

4. CONSOLIDATED BALANCE SHEET AND CONSOLIDATED INCOME STATEMENT AT DECEMBER 31, 2025 158

   Consolidated Balance Sheet 159

   Consolidated Income Statement 160

   Consolidated Comprehensive Income Statement 161

   Consolidated statement of cash flows 162

   Consolidated Statement of Changes in Equity 163

5. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT DECEMBER 31, 2025 165

   Accounting principles and policies 166

   Notes to the Balance Sheet 192

   Notes to the income statement 207

   Related party transactions 212

   Remuneration of Directors, Statutory Auditors and independent audit firm 216

   Disclosure pursuant to Article 149 of the Consob Issuer's Regulation 216

   Subsequent events 216

6. DECLARATION OF THE ANNUAL FINANCIAL REPORT PURSUANT TO ARTICLE 81-TER OF CONSOB REGULATION NO. 11971 OF MAY 14, 1999 AND SUBSEQUENT AMENDMENTS AND SUPPLEMENTS 218

Annual Financial Report | 3

1. ‌LETTER TO THE SHAREHOLDERS

   Dear Shareholders,

   2025 was a crucial year for SECO. We have emerged from a complex destocking environment with a new drive, ability to execute and a clear strategic vision. The company has resumed its path of sustainable growth, while continuing its transformation into a complete solution company for Edge AI, a particularly advantageous position in an industry going through comprehensive technological transformation.

   The construction of a European sample in Edge AI solutions is a lynchpin of our approach and resonates strongly with our customers. With supply chain control becoming increasingly central to purchasing decisions in Europe and globally, SECO's roots, our manufacturing presence and the engineering skills developed on the European continent are a key competitive advantage. Large enterprises and Tier 1 OEMs are actively seeking reliable regional partners to reduce geopolitical risk.

   The global Edge AI market is expected to grow at double-digit annual rates for the next decade, supported by the progressive digitization of industrial processes, the increasing prevalence of IoT devices, and the growing demand for real-time intelligent processing capabilities directly on devices, with high levels of privacy protection. The manufacturing sector is seeing the fastest growth, with significant reductions in downtime as companies adopt Edge AI.

   In 2025, SECO further strengthened its technological advantage. We have consolidated our partnerships with Qualcomm, Intel, NXP, MediaTek, Axelera AI, and Raspberry Pi. Clea OS 2.0, our industrial-grade operating system based on Yocto, accelerates the time-to-market for customers and ensures seamless integration with the cloud. Our Application Hub - which aims to surpass 150 validated AI applications later this year - democratizes solution adoption, enabling advanced applications to be deployed in a matter of weeks rather than months. This ecosystem-based approach helps to create switching costs and strengthen customer loyalty. Furthermore, the emergence of new regulatory standards, such as the Cyber Resilience Act, represents an additional structural factor that promotes the adoption of our solutions by customers.

   Operationally, we have demonstrated strategic vision by tapping into opportunities in several areas, including industrial automation, medical devices, smart buildings and intelligent transportation. The new production plant in Arezzo will generate a significant increase in production capacity by the second half of 2026, eliminating potential supply constraints. We have also expanded our capabilities at the Hangzhou plant, and built a state-of-the-art anechoic chamber at our Hamburg site.

   SECO stands out today for the clarity of our strategy. We are no longer just a hardware company: we are a solutions-focused enterprise, powered by software, simplifying the adoption by customers of artificial intelligence at an industrial level, accelerating time-to-market and reducing technological risk. Our ecosystem - edge computing, Clea OS and Application Hub - creates a level of differentiation that our competitors do not have at their disposal.

   Our new hardware platforms, including the Modular Vision HMI product line, position us with a unique advantage in several key industries such as defense, medical, industrial automation, robotics and drones. At the same time, integrating artificial intelligence into internal processes - through partnerships with companies such as Google and other technology players - will help improve efficiency in engineering, quality, marketing and sales activities. Our CLEA framework is becoming increasingly relevant for customers every day, while the infrastructure investments made in 2025 place us among the most technologically advanced operators in our market.

   We are truly at a turning point today. The convergence between the exponential growth of Edge AI, the spread of increasingly accessible software platforms, the strengthening of the SECO ecosystem, and

   our positioning as a leading European player has created a major value creation opportunity. We are confident in our ability to tap into this opportunity while maintaining disciplined financial management and a constant commitment to innovation and the success of our customers.

   We would like to express our sincere gratitude to the customers, partners, and employees whose daily commitment contributes to our success. The trust you place in SECO strengthens our determination to bring our vision to life and create lasting value for our shareholders.

   Thank you for your continued trust in SECO.

   Daniele Conti and Massimo Mauri (Chairperson & Chief Executive Officer)

   Corporate Boards Board of Directors

   Office held until the approval of the 2026 annual accounts

   Chairperson Daniele Conti

   Chief Executive Officer Massimo Mauri

   Directors Michele Secciani

   Claudio Catania Luciano Lomarini Kurt Tosja Zywietz

   Valentina Montanari Anna Zattoni

   Valentina Beatrice Manfredi Paolo Lavatelli

   Board of Statutory Auditors

   Office held until the approval of the 2026 Annual Accounts

   Statutory Auditors Cesare Beolchi (Chairperson) Pierpaolo Guzzo

   Micaela Badiali

   Alternate Auditors Prospero Accogli Edda Delon

   Executive Officer for

   Financial Reporting Lorenzo Mazzini

   Independent Audit Firm Deloitte & Touche S.p.A. Office held until the approval of the 2029 Annual Accounts

2. ‌THE GROUP AND ITS OPERATIONS

   The SECO Group (hereinafter also referred to as the "Group" or "SECO") consists of the parent company SECO S.p.A., hereinafter also referred to as the "Company" or "Parent Company", and its subsidiaries, as presented below:

   
   
   
   
   

   The Company's registered office is located in Arezzo (AR), via Achille Grandi 20.

   SECO is a high-tech Group that develops and delivers cutting-edge solutions for the digitization of industrial products and processes. SECO's hardware and software offerings enable B2B enterprises to introduce edge computing, Internet of Things, data analytics and artificial intelligence into their businesses. Within a quickly and broadly evolving marketplace, SECO's technologies encompass many fields of application, with innovative and customized solutions provided to its more than 450 customers, in sectors such as the Medical, Industrial Automation, Fitness, Vending and Transportation areas, in addition to many others.

3. ‌DIRECTORS' REPORT

‌FIRST SECTION

Contents

Market overview 12

Operational overview 13

Research and Development and Technological Innovation 13

Operating Performance 15

Balance Sheet Overview 17

Financial Information 18

Alternative performance measures 19

Risks and uncertainties 21

SECO on the stock exchange 22

Outlook 22

Global monetary policy in 2025 was more expansionary than in the previous year, with the main central banks cutting rates to stimulate a general economic recovery. Normalizing inflation, particularly in Europe, has enabled Europe's central banks to gradually ease their restrictive monetary policies, spurring a return of investment and particularly benefitting the industrial component.

The global economic environment in the period was in addition impacted by the geopolitical and the global trade tensions, particularly in terms of possible short to medium-term effects. Tensions within the business and geopolitical environment however have eased over recent months, resulting in a reduced impact from the restrictive trade measures on the demand for edge computing solutions.

On the currency market, the U.S Dollar began to weaken from the second quarter of 2025. This did not translate into reduced demand for edge computing solutions on the U.S. market, which, on the contrary, contributed significantly to the Group's growth during the period. The weakening of the Dollar however negatively impacted the revenues recognized, reducing the value of income and revenues reported in the financial statements of the companies exposed to the U.S. currency.

Geopolitical tensions and fluctuations in commodity prices affect the supply of certain component categories. Delivery timings have generally settled at the improved levels emerging over recent quarters, although a number of critical components have been impacted by certain variable factors. In the electronic components market, the prices of memories used in B2C and B2B applications have generally risen: this mainly owes to the sustained increase in global demand for memories for the building of data centers for artificial intelligence applications. With regard to the other categories of electronic components, a general stabilization has emerged, with prices mostly declining for passive components such as resistors and capacitors.

Within this environment, the Edge Computing segment continues to constitute a key element for technological innovation: the digitalization of devices and processes in fact may significantly contribute to boosting productivity and industrial efficiency, which are essential elements not only for companies' competitiveness, but also their very survival.

Business process digital transformation is enabled by adopting smart solutions that integrate hardware and software components, facilitating the establishment of new business models and the creation of further development opportunities. The increasingly widespread adoption of digital technologies is extending also to traditionally more analogue segments: many companies are investing to improve the user experience and functionality of their products, adapting them to an increasingly interconnected and cutting-edge environment.

Against this backdrop, the main sector growth trends center on factors such as: the development of increasingly innovative technologies for Edge computing and embedded AI, linked to the integration of energy-efficient microcontrollers capable of supporting AI features, the growing interest in hardware and firmware security, against increasing cyber threats, through the development guidelines for embedded cybersecurity technologies, the expansion of IoT technologies, through the spread of realtime operative open source systems and the direct connection of intelligent devices in the industrial area. The integration of IoT-data analytics and artificial intelligence solutions within edge computing devices is also likely to accelerate the launch of new high value-added services and an evolution in the way that businesses deal with the creation, delivery and use of ICT products and services.

In addition, digitization can play a key role within a landscape in which climate change and raw material and energy supply issues make it increasingly necessary to adopt solutions that can accelerate the energy transition. In particular, by enabling the local execution of increasingly complex

computational models, tools can be developed through Edge AI that can increasingly monitor and optimize the power consumption of industrial and home-use devices.

In terms of market dynamics, the growth emerging in Q4 2024 of edge computing and IoT solutions among operators within the various verticals in which the Group operates gradually expanded in the period. This reflects gradually normalizing inflation, particularly in Europe, which has enabled the central banks to adopt a moderately expansive monetary policy, benefitting (although not immediately) enterprise investment appetite, the related rebuilding of stocks and therefore the demand for SEC's products.

New Edge computing product development continues, particularly on modular Human Machine Interface (HMI) and System on Module (SOM) systems, alongside the new features in the Clea software suite. Clea represents a further development of SECO's strategy to leverage over 40 years of Edge computing know-how, with the goal of increasing value for customers, through the offer of end-to-end, integrated, customizable solutions based on micro-computing, human-machine interfaces and software platforms.

Also through long-term partnerships with the major silicon vendors, SECO has always committed to innovating its hardware proposal (e.g. with the launch of new dedicated Edge AI and Computer vision products), while continuing to work closely with its customers, supporting them through the digital evolution of their devices.

Globally, as a result of growing demand from OEMs and developers, the adoption of smart and connected edge computing solutions has accelerated in high-potential sectors such as medicine, e-mobility, smart retail and energy infrastructure, with the integration of distributed computing capabilities, secure connectivity and artificial intelligence at the edge level supporting significant boosts in operational efficiency and real-time analytics capabilities.

Against this backdrop, Group sales generally recovered during the period, driven particularly by the U.S. and APAC areas. The EMEA market on the other hand has been impacted, mainly due to the weakness of the German economy, while the Italian market has recovered.

Again in 2025, SECO remained strongly committed to ensuring high levels of innovation, integration and added value in the solutions built according to the specific needs of customers operating in multiple verticals.

SECO's main objective is to anticipate the needs of its customers, utilizing frontier technologies and supporting them in the digital transition of their business, while adding value to their solutions.

The constant push for innovation by all the players in a given sector can quickly render a competitive advantage obsolete. As such, every year SECO dedicates significant resources to Research and Development, which concerned the development of new products and of off-the-shelf solutions to be sold on the market, in addition to the co-development and co-engineering of customized products, working hand-in-hand with the customer.

The SECO Group R&D departments are responsible for developing and designing technological solutions based on integrated systems, standard and custom solution modules and IoT and AI software solutions for SECO's customers and target markets. Research and development is a key aspect of SECO's

business model and is carried out both in-house and through partnerships with world-class technology enterprises and research institutes and university hubs worldwide.

The technological development in which SECO has invested in recent years has positioned the Group as a leading player in the combined provision of both hardware and software. The technological challenge that the Group is taking on is that of developing high-performance hardware, with a particular emphasis on strengthening edge computing capacity by creating new products able to run inference models locally, taking advantage of edge processing capacity directly and creating an optimal integration of hardware and the CLEA software platform.

Our strong partnerships with the primary technology leaders in the electronics industry enable the Group to implement our technology strategy by gaining early access to some of the most cutting-edge technologies being developed. The product research and development activities, central and strategic to the group's business model, are focused on making the adoption of the most advanced hardware and software technologies more accessible and secure for users and the actors of SECO's industrial ecosystem.

Major hardware developments during 2025 included the expansion of the modular human machine interface (HMI) product lines, with new products released in both ARM and x86 segments and scalable proposals from 7'' to 15'' for rapid adoption in multiple segments of industrial automation and process control. During the year, new generations of System on Module in COM Express and SMARC form factors were developed introducing the latest technologies in edge computing and AI performed on field (edge) devices.

From a software development perspective, the launch of the new operating system Clea OS 2.0 follows a similar path, intended to become the standard platform for all SECO products based on ARM and x86 architectures. This solution contains cybersecurity capabilities, also enabling the remote update and deployment of artificial intelligence algorithms in field devices.

2025 saw development costs of Euro 16,595 thousand capitalized (Euro 15,148 thousand in 2024), of which Euro 12,094 thousand related to personnel costs (Euro 11,206 thousand in 2024), while Euro 3,191 thousand was expensed to the income statement.

December 31, 2025 vs December 31, 2024

Revenues rose from Euro 183,512 thousand in 2024 to Euro 197,581 thousand in 2025, driven particularly by the USA and APAC regions.

Other revenues and income decreased from Euro 3,068 thousand in 2024 to Euro 3,010 thousand in 2025, a decrease of Euro 59 thousand (-1.91%). The item mainly concerns the recognition of the portion of the tax credit accruing in the year for the research and development and innovation activities of the Italian Group companies for Euro 793 thousand, and the capital grant tax credit for the purchase by SECO S.p.A. of capital goods under Industry 4.0 of Euro 364 thousand (portion accruing in the year); and the portion related to the Group's participation in calls for tenders in the amount of Euro 449 thousand.

Service costs decreased by Euro 4,497 thousand (-15.59%) - from Euro 28,843 thousand in 2024 to Euro 24,346 thousand in 2025, due mainly to a reduction of Euro 2,075 thousand in outsourcing costs, Euro 928 thousand in transport costs, and Euro 933 thousand in consulting services.

Personnel costs increased from Euro 42,247 thousand in 2024 to Euro 44,067 thousand in 2025, an increase of Euro 1,821 thousand (+4.31%), mainly due to: (i) the costs related to the expanded Group workforce, for the hire of key figures in 2025 to support the R&D, production and sales development plans; (ii) the recognition of the higher cost for the stock option plans awarded to the management team and employees of the companies of the Group.

Depreciation, amortization and impairments decreased from Euro 30,018 thousand in 2024 to Euro 24,347 thousand in 2025, a decrease of Euro 5,671 thousand (-18.89%). The effect of ordinary depreciation and amortization remains substantially stable, the overall reduction in the item is therefore attributable to the absence of extraordinary write-downs in the period under review, which had affected the previous year.

The doubtful debt provision and the provision for risks and charges decreased from Euro 142 thousand in 2024 to Euro 63 thousand in 2025. The account principally concerns the doubtful debt provision, in addition to the agent supplementary indemnity provision.

Other operating costs decreased from Euro 10,025 thousand in 2024 to Euro 5,842 thousand in 2025, an overall decrease of Euro 4,183 thousand (-41.73%). This movement is mainly attributable to: (i) "Other operating costs", decreasing by Euro 3,502 thousand, which in 2024 included the repayment arising from the tax audit by the Tax Agency on the tax period from 2015 to 2022, which in total related to direct taxes, indirect taxes and tax credits; (ii) the item "Directors' fees and related charges", decreasing Euro 358 thousand compared to the previous year, mainly related to the recognition of the cost of the stock option plans allocated to Directors; (iii) recognition of lower losses on receivables totaling Euro 54 thousand, a decrease of Euro 156 thousand from the previous year.

Financial management, including the effect of financial income, financial charges and exchange gains/(losses), reports a net charge of Euro 8,286 thousand for 2025, a decrease of Euro 7,308 thousand compared to 2024, due mainly to the following: (i) a reduction of Euro 2,937 thousand in financial income compared to the previous year, mainly as a result of the recognition of lower interest income on hedging derivatives; (ii) higher financial expenses of Euro 1,644 thousand mainly due to the offsetting effect of the write-down of the investee Laserwall S.r.l., for Euro 4,003 thousand, net of the reduction of Euro 2,188 thousand in interest rates on short-term credit lines and medium- to longterm bank debt.

Income taxes increased from Euro 1,103 thousand in 2024 to Euro 1,426 thousand in 2025, an increase of Euro 323 thousand.

As a result of the above, the result improved from a net loss of Euro 17,663 thousand in 2024 to a net profit of Euro 496 thousand in 2025.

Reference should be made to the balance sheet in this regard. The main changes at December 31, 2025 were as follows.

December 31, 2025 vs December 31, 2024

Total non-current assets decreased from Euro 302,020 at December 31, 2024 to Euro 300,967 thousand at December 31, 2025, a reduction of Euro 1,053 thousand, mainly due to: (i) the increase in "Property, plants and equipment" for Euro 5,323 thousand, mainly due to the investments made by the Group, net of depreciation in the year; (ii) the reduction in "Non-current financial assets" for Euro 3,996 thousand, following the write-down of the investments in the company Laserwall S.r.l. for Euro 4,003 thousand, and the change in the value of the Mark to Market of the interest rate hedging derivatives on the medium/long-term loans undertaken by the Group.

Current assets decreased from Euro 188,908 thousand at December 31, 2024 to Euro 185,116 thousand at December 31, 2025, decreasing Euro 3,792 thousand. The main changes concerned: (i) "Inventories", which decreased by Euro 8,029 thousand from 2024 mainly due to the ongoing improvement in the management of inventories; (ii) "Trade receivables", which increased by Euro 8,513 thousand from the previous year, mainly due to higher Group turnover; (iii) the recognition of "Current financial assets" for Euro 2,030 thousand; and (iv) the decrease in "Cash and cash equivalents" for Euro 5,929 thousand.

Total non-current liabilities decreased from Euro 133,218 thousand at December 31, 2024 to Euro 127,002 thousand at December 31, 2025, a decrease of Euro 6,216 thousand. The main changes concerned: (i) the Euro 5,227 thousand decrease in non-current financial liabilities as a result of repayments of financing; and (ii) the Euro 717 thousand decrease in non-current financial lease payables.

Total current liabilities decreased from Euro 65,978 thousand at December 31, 2024 to Euro 64,616 thousand at December 31, 2025, a reduction of Euro 1,362 thousand, mainly due to: (i) the reduction in current financial liabilities for Euro 3,327 thousand, which includes bank payables regarding the credit lines in place, current account overdrafts, credit card payables, payables for invoice advances and short-term loans due within one year for operating needs at December 31, 2025; (ii) the increase in trade payables for Euro 3,170 thousand; (iii) the reduction in tax payables and other current payables for Euro 539 thousand and Euro 740 thousand respectively.

December 31, 2025 vs December 31, 2024

At December 31, 2025, operating activities generated cash of Euro 34,792 thousand, decreasing by Euro 98 thousand from the previous year. This decrease is mainly due to the combined effect of the following factors: (i) an increase in cash flows before net working capital changes for Euro 21,320 thousand compared to the previous year, (ii) the increased absorption of cash deriving from trade receivables of Euro 28,111 thousand compared to the previous year (iii) a reduction in liquidity with regards to the decrease in inventories for Euro 5,152 thousand, (iv) a lesser absorption of liquidity deriving from the increase in trade payables, for Euro 8,387 thousand compared to the change in the previous year, (v) a lesser absorption of cash for the payment of taxes of Euro 4,955 thousand.

The investment activities absorbed cash of Euro 26,017 thousand, increasing from the previous year by Euro 5,820 thousand. These movements are mainly due to the increase in investments in property, plants and equipments.

Financing activities absorbed cash totaling Euro 12,861 thousand, with a reduced absorption of cash compared to the previous year for Euro 5,271 thousand, mainly due to: (i) the increased drawdown of loans of Euro 3,230 thousand compared to the previous year; (ii) a reduction in the settlement of bank loans of Euro 1,829 thousand compared to the previous year, (iii) the dividends issued to the minority shareholders of the subsidiary Fannal Electronics Co., Ltd. in 2024 for Euro 2,899 thousand.

As a result of that outlined above, cash and cash equivalents at December 31, 2025 decreased by Euro 5,928 thousand compared to December 31, 2024, respectively decreasing from Euro 72,586 thousand to Euro 66,658 thousand.

The following tables present the operating and financial measures used by the Group to monitor performance, in addition to the measurement methods.

In order to better understand the Group's operating and financial performance, the Directors have identified a number of alternative performance measures ("APM" or "Alternative Performance Measures").

The following table presents the key alternative performance measures for the operating results and balance sheet:

EBITDA - This measure is used by the Group as a financial target and is useful for assessing operating performance. EBITDA is calculated as profit or loss for the year before income taxes, financial income and charges (including exchange rate gains and losses), and amortization and depreciation.

(*) Costs for services, goods and other operating costs include the following income statement items: costs of raw, ancillary, consumable materials and goods; changes to inventory; service costs; the doubtful debt provision and provisions for risks and charges; other operating costs; exchange gains and losses.

The increase between the two years (Euro 17,393 thousand, +111.28%) is mainly attributable to the increase in sales revenues, which allowed for an operational leverage effect.

Adjusted EBITDA - Adjusted EBITDA is a measure to assess the Group's operating performance. Adjusted EBITDA is calculated as the profit before income taxes, financial charges and income (including exchange gains and losses), amortization and depreciation, and extraordinary/non-recurring expenses.

With regards to Adjusted EBITDA, the Group considers that the adjustment (which defines Adjusted EBITDA) was made to represent the Group's operating performance, net of effects of a number of events and transactions.

activities

business activities

The Group reports 2025 Adjusted EBITDA of Euro 40,203 thousand, increasing 42.52% on 2024. Income/charges from non-core business activities of Euro 5,561 thousand mainly refer to:

• The allocation of stock options to managers and directors for Euro 5,296 thousand (Euro 5,026 thousand in 2024).

• To severance payments to two employees with managerial roles in the amount of Euro 183 thousand (Euro 252 thousand in 2024).

Income considered to fall within the core business activities that are non-recurring, amounting to Euro 86 thousand, mainly refer to agent termination indemnities for Euro 78 thousand.

Net financial debt - This measure indicates the Group's financial debt, net of cash and cash equivalents.

The breakdown of the net financial debt at December 31, 2025 compared with December 31, 2024 is presented on the following page, determined in accordance with "Reminder No. 5/21" dated April 29, 2021 issued by Consob, which refers to ESMA Guideline 32-382-1138 dated March 4, 2021.

At December 31, 2025, the Group net financial debt was Euro 47,250 thousand, compared to Euro 52,494 thousand at December 31, 2024.

The net financial debt decreased overall by Euro 5,244 thousand compared to December 31, 2024.

Adjusted Net financial debt - The Adjusted net financial debt indicates the Group's capacity to meet its financial obligations.

The Adjusted net financial debt is determined by the Group by adjusting the Net financial debt calculated according to the "Reminder No. 5/21" dated April 29, 2021 issued by Consob, which refers to ESMA Guideline 32-382-1138 dated March 4, 2021, with the VAT receivable, the current and non-current financial receivables deriving from leases and recognized under IFRS 16 and the effect of the recognition of the MTM of the derivatives where liabilities.

(*) at December 31, 2025, the Mark to Market of derivatives was a positive Euro 5,035 thousand, compared to a positive Euro 6,914 thousand at December 31, 2024. These active derivatives are classified as non-current financial assets which are not included in the components to be considered when determining net financial debt, as per Consob Communication in accordance with ESMA recommendations 2022/32/382/1138, and they are therefore not included in the calculation of Adjusted net financial debt.

The Adjusted net financial debt was Euro 37,599 thousand at December 31, 2025, compared to Euro 41,309 thousand at December 31, 2024.

The main risk factors are examined in the Risk Management Policies section of the Explanatory Notes, to which reference should be made for further details. This section outlines the risk related to the general economic environment.

The SECO Group is exposed to risks arising from the characteristics and evolving dynamics of the economic cycle and the domestic and international political context. Furthermore, although the Group serves a wide range of sectors and customers, we currently have several loyal customers who account for over 5% of revenue and whose potential loss or downsizing could negatively impact the Group's business and our financial performance and standing.

The production activity of the Group depends on the availability of electronic components and semiconductors supplied by global operators. Any tensions in the supply chains, delays in deliveries, or shortages of critical components could affect the continuity of production processes and delivery times to customers. The Group constantly monitors the evolution of the supply chain and adopts, where possible, supplier diversification policies and procurement planning.

The SECO Group operates on international markets exposed to geopolitical and regulatory risks. Trade tensions between economic areas, the introduction of tariffs or restrictions on the export of sensitive technologies, in addition to the possible introduction of economic sanctions or regulatory restrictions, could limit access to certain markets or influence global supply chains. In addition, some technology products and components may be subject to export control and technology security regulations.

The current geopolitical scenario is characterized by a high fragmentation of conflicts, with some high-intensity wars and numerous regional conflicts or civil wars. This environment generates risks of economic instability, disruptions in supply chains and volatility in international markets.

The prolongation of the conflict between Russia and Ukraine, which began in 2022, has had significant global consequences due to economic effects on the world's markets, especially in terms of increased transportation costs, raw material prices, and energy costs. The resulting geopolitical instability had significant general economic repercussions, mainly concerning - but not limited to -the European continent.

The increased geopolitical tensions in the Middle East, which began in October 2023, have affected the flow of trade. In particular, potential attacks on vessels transiting the Red Sea have led to a drastic reduction in traffic through the Suez Canal and a diversion of trade routes, resulting in increased costs and longer time frames related to the transportation of supplies and distribution of products. Added to this are the recent tensions over the Strait of Hormuz as a result of the conflict between the U.S., Israel and Iran, which is leading to a reduced sourcing of oil, and helium - which is highly used in the production of semiconductors and cooling of data centers - with possible significant impacts on the price of energy, transportation and many categories of goods for industrial and retail use.

Against this background, there are also growing geopolitical and trade tensions between major economic powers, particularly between the United States and China, which are leading to the introduction of industrial policies and trade restrictions in strategic technology sectors, including semiconductors and advanced technologies.

Overall, the current geopolitical environment entails an increase in global macroeconomic uncertainty and may affect energy costs, availability of technology components, international trade, and stability of supply chains, with possible effects on the operations and strategic planning of companies operating on an international scale.

The development of these issues globally is outside of the Group's control and the impacts on the financial markets and economic activity may not be forecast on a worldwide basis.

The first part of the year was characterized by an escalation of geopolitical tensions and an inflationary scenario that did not allow central banks to make corrections to interest rates.

SECO S.p.A. shares are traded on the Milan Euronext Star market organized and managed by Borsa Italiana S.p.A. At December 31, 2025, the SECO S.p.A. (IOT:MI) stock price was Euro 2.93, with a capitalization therefore of Euro 390.8 million.

SECO is continuing to acquire new design wins and customers, strengthening the foundation for our future development.

The gradual normalization of inflation, particularly in Europe, which has enabled central banks here to gradually loosen monetary policy over the second half of 2024, had a positive impact on the investment appetite of businesses in 2025. Within this landscape, albeit in light of the previously highlighted geopolitical dynamics, we are seeing a gradual rebuilding of inventories and a consequent recovery in the demand for hardware. As of the date of this report, the general market environment, that of the various geographies and of the Group target segments are likely to support business growth over the coming months.

As of early 2026, there are tensions on memory prices and supply, mainly due to the sustained increase in global demand for memory to build data centers for artificial intelligence applications. The impacts of such tensions represent an additional challenge and uncertainty for the Group, as the effects are currently unquantifiable in terms of both scope and duration.

A digital revolution is underway in the market, where digitization and the use of Artificial Intelligence algorithms "at the Edge" assume a key role for the future technological development of enterprises. The growing demand for smart solutions increasingly concerns the introduction of Artificial Intelligence, directly on the device locally, to enable the launch of new high value-added services, leveraging field data and introducing new business models. SECO's comprehensive and integrated technology proposition focused on Edge computing and IoT-data analytics is designed to meet these needs and enable customers to tap into the digitization opportunities emerging across all sectors. In this context, SECO has evolved its offerings over time, building the value proposition to meet the evolving needs of customers within the increasingly broad range of verticals served. Al, the competitive positioning of the Company has also gradually shifted, as it positions itself today as a solution company focused on generating value for the customer through integrated hardware, HMI and software-AI solutions.

In this volatile general economic environment, SECO will continue to work as always in meeting commitments and targets, maintaining a consistent focus on the efficient management of its financial structure to respond in an agile and prompt manner to the challenges and market uncertainties.

‌SECOND SECTION - CONSOLIDATED SUSTAINABILITY STATEMENT

Contents

General disclosures 29

ESRS 2 General Disclosures 29

BP-1 - General basis for preparation of sustainability statements 29

BP-2 - Disclosures in relation to specific circumstances 30

Governance 34

GOV-1 - The role of the administrative, management and supervisory bodies 34

GOV 2 - Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies 39

GOV-3 - Integration of sustainability-related performance in incentive schemes 51

GOV-4 - Statement on due diligence 51

GOV-5 - Risk management and internal controls over sustainability reporting 53

Strategy 57

SBM-1 Strategy, business model and value chain 57

SBM-2 Interests and views of stakeholders 61

SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 63

Management of impacts, risks and opportunities 65

IRO-1 - Description of the processes to identify and assess material impacts, risks and opportunities 65

IRO-2 Disclosure Requirements in ESRS covered by the undertaking's sustainability statement 68

MDR-P Policies adopted to manage material sustainability matters 79

Environmental information 87

E1 Climate Change 87

Governance 87

ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes 87 Strategy 87

E1-1 Transition plan for climate change mitigation 87

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 87

Management of impacts, risks and opportunities 88

ESRS 2 IRO-1 Description of the processes to identify and assess material climate-related impacts, risks and opportunities 88

E1-2 Policies related to climate change mitigation and adaptation 89

E1-3 Actions and resources in relation to climate change policies 89

Metrics and targets 90

E1-4 Targets related to climate change mitigation and adaptation 90

E1-5 Energy consumption and mix 90

E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions 91

Calculation methodologies and exclusions (MDR-M) 96

E2 Pollution 96

Management of impacts, risks and opportunities 96

ESRS 2 IRO-1 Description of the processes to identify and assess material pollution-related impacts, risks and opportunities 96

E2-1 Policies related to pollution 97

E2-2 Actions and resources related to pollution 97

Metrics and targets 98

E2-3 Targets related to pollution 98

E2-4 Pollution of air, water and soil 98

E5 Resource use and circular economy 99

Management of impacts, risks and opportunities 99

ESRS 2 IRO-1 Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities 99

E5-1 Policies related to resource use and circular economy 100

E5-2 Actions and resources related to resource use and circular economy 100

Metrics and targets 101

E5-3 Targets related to resource use and circular economy 101

E5-4 Resource inflows 101

E5-5 Resource outflows 102

Calculation methodologies and exclusions (MDR-M) 104

Information according to Article 8 of Regulation 2020/852 (EU Taxonomy Regulation) 105

Social information 112

S1 Own workforce 112

Strategy 112

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 112

Management of impacts, risks and opportunities 116

S1-1 Policies related to own workforce 116

S1-2 Processes for engaging with own workers and workers' representatives about impacts 118

S1-3 Processes to remediate negative impacts and channels for own workers to raise concerns 119

S1-4 Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions 119

Metrics and targets 121

S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities 121

S1-6 Characteristics of the undertaking's employees 121

S1-7 Characteristics of non-employee workers in the undertaking's own workforce 122

S1-8 Collective bargaining coverage and social dialogue 122

S1-9 Diversity metrics 123

S1-10 Adequate wages 123

S1-13 Training and skills development metrics 124

S1-14 Health and safety metrics 124

S1-16 Remuneration metrics (pay gap and total remuneration) 125

S1-17 Incidents, complaints and severe human rights impacts 126

Recruitment and Methodologies 126

S2 Workers in the value chain 130

Strategy 130

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 130

Management of impacts, risks and opportunities 133

S2-1 Policies related to value chain workers 133

S2-2 Processes for engaging with value chain workers about impacts 135

S2-3 - Processes to remediate negative impacts and channels for value chain workers to raise concerns 135

S2-4 - Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions 135

Metrics and targets 136

S2-5 - Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities 136

S3 Affected communities 137

Strategy 137

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 137

Management of impacts, risks and opportunities 141

S3-1 Policies related to affected communities 141

S3-2 Processes for engaging with affected communities about impacts 141

S3-3 Processes to remediate negative impacts and channels for affected communities to raise concerns 142

S3-4 Taking action on material impacts on affected communities, and approaches to managing material risks and pursuing material opportunities related to affected communities, and effectiveness of those actions 142

Metrics and targets 142

S3-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities 142

S4 Consumers and end-users 143

Strategy 143

ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 143

Management of impacts, risks and opportunities 145

S4-1 Policies related to consumers and end-users 145

S4-2 Processes for engaging with consumers and end-users about impacts 146

S4-3 Processes to remediate negative impacts and channels for consumers and end-users to raise concerns 147

S4-4 Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions 147

Metrics and targets 148

S4-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities 148

Governance information 148

G1 Business conduct 148

Governance 148

GOV-1 The role of the administrative, management and supervisory bodies 148

Management of impacts, risks and opportunities 149

ESRS 2 IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities 149

G1-1 Corporate culture and business conduct policies 150

G1-2 Management of relationships with suppliers 152

G1-3 Prevention and detection of corruption and bribery 153

Metrics and targets 154

G1-4 Confirmed incidents of corruption or bribery 154

G1-6 Payment practices 154

Entity-specific information 155

Management of technological innovation and Artificial Intelligence 155

Governance 155

Management of impacts, risks and opportunities 155

Strategy 156

Actions 156

Targets 157

‌BP-1 - General basis for preparation of sustainability statements

This document is the Consolidated Sustainability Statement (hereinafter also the "Sustainability Statement") of the SECO Group (hereinafter also "SECO" or the "Group"). The Statement is prepared annually in compliance with Legislative Decree No. 125/2024, issued to implement Directive 2022/2464/EU (the "Corporate Sustainability Reporting Directive") and the requirements of Article 8 of Regulation (EU) 2020/852 of the European Parliament. [BP1, 5-a]

Reporting scope [BP1-5- b i]

The reporting scope corresponds to that of the 2025 Consolidated Financial Statements. The scope has changed since the previous financial year due to the dissolution and subsequent deregistration of SECO Mind USA LLC.

The qualitative information and quantitative data contained in the sections of this Consolidated Sustainability Statement are reported in aggregate form at Group level and, where deemed necessary, specific details have been provided for the following geographical areas in which the Group operates:

• Italy: includes the parent company SECO S.p.A. and the companies PSM Tech S.r.l. and SECO Mind S.r.l;

• Germany: includes the companies SECO Northern Europe GmbH and SECO Mind Germany GmbH

• USA: Includes SECO USA, Inc.

• APAC: includes SECO Asia Limited, Fannal Electronics Co., Ltd. and SECO Microelectronics Co., Ltd.

• Other: includes the company SECO BH d.o.o.

The Company e-GITS India Private Ltd carried out no operations and employed no staff during the reporting period; as such, no environmental or social data are reported.

Within the Group's scope, the parent company SECO S.p.A. is solely responsible for preparing the Sustainability Statement. [BP1, 5-b ii]

In the "Technical Details" paragraph, data are presented both by geographical area and at Group level.

SECO has not made use of the option to omit specific information related to intellectual property, know-how or innovation outcomes, nor of the exemption from disclosing impending developments or matters in the course of negotiation - pursuant to Article 19-bis, paragraph 3 and Article 29-bis, paragraph 3 of Directive 2013/34/EU - as it is not applicable. [BP-1, 5d, 5e]

Value chain [BP-1, 5c]

The upstream and downstream value chain was taken into account when mapping impacts, risks and opportunities. This activity informed the definition of the contents presented in this statement. For further details on the reporting scope, reference should be made to the value chain mapping set out in the dedicated section (ref. IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities), which was developed according to the specific features of the

business model and includes a mapping of the Group's relationships with value chain actors up to the third tier.

In addition, with regard to value chain coverage, the policies currently adopted by SECO, which also extend upstream, mainly concern Conflict Minerals management and the procurement policy. Specifically, the Conflict Minerals policy requires suppliers to declare and guarantee that they do not source raw materials from conflict-affected areas (Tier 2), thereby strengthening oversight along the supply chain. Similarly, the procurement policy establishes the criteria for selecting and monitoring business partners, incorporating specific expectations related to compliance and responsibility.

The metrics reported in this document do not include quantitative data related to the upstream or downstream value chain, except for the information used to calculate Scope 3 emissions. The upstream and downstream value chain was also considered when mapping climate-related impacts (greenhouse gas emissions), as part of the carbon footprint analysis, with a specific focus on Scope 3 indirect emissions (ref. E1-6 - Gross Scopes 1, 2, 3 and Total GHG emissions).

‌BP-2 - Disclosures in relation to specific circumstances

Time horizons

When identifying the short-, medium- and long-term time horizons contained in this Sustainability Statement, SECO adopted those set out in ESRS 1 - 6.4, Definition of short-, medium- and long-term for reporting purposes, which establishes the following time horizons starting from the end of the reporting period:

• Short term the period adopted by the undertaking as the reporting period in its financial statements, i.e., to December 31, 2026;

• Medium term: The period ending five years from the end of the reporting period, i.e., December 31, 2031;

• Long term: The period beyond the five-year medium-term horizon, i.e., beyond December 31, 2031.

The only exception to the above applies to time horizons defined when analyzing climate scenarios. Due to the nature of climate-related risks - particularly physical risks - and in light of the European policies adopted in recent years - specifically those concerning transition risks - the long-term horizon has been extended to 2050. For more information, see chapter E1.

In addition, with regard to climate-related topics, SECO began a structured process in 2025 to define and progressively adopt a decarbonization plan. The plan includes Near-Term targets aligned with the 1.5°C scenario, i.e., emission reduction targets over a 5-10 year horizon. [BP-2, 9]

Value chain estimation

When preparing this Sustainability Statement, SECO used estimates relating to value chain data and information to calculate Scope 3 emissions, as detailed in the section "E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions."

To improve the accuracy and reliability of value chain metrics, the Group intends to strengthen its data collection and management processes, particularly with respect to customers and suppliers, progressively updating methodologies and tools in line with the evolution of relevant principles and standards. [BP-2, 10]