9-Month Report 2024

Key financial figures

50.33 %

36.62 %

9.63 %

3.42 %

100 %

Bank deposits

and overnight deposits

Despite a persistently challenging economic environment, particularly in our core market Germany, we performed well in the first nine months of the year.

WPP plc., St. Helier Private investors/others Institutional investors

HANSAINVEST

Shareholder structure

Portfolio structure of cash and marketable securities

50 %

50 %

72 %

28 %

Equity

Liabilities

Non current assets

Current assets

Balance sheet structure

36 % Services

18 % Automotive

18 % Consumer goods 15 % Finance/insurances

7 % Telecommunication/IT 6 % Others

Sales allocation by vertical markets

Sales by employee annualised (in kEUR)

33 %

17 %

50 %

Top 5

Top 6-10

Others

Sales by clients' volume

23 % Technology 16 % Strategy/consulting 16 % Project management 16 % Performance marketing 16 % Design

13 % Administration

Employees by function

Business development

and Group Management Report

1. General

The following Group Management Report provides information on the performance of the SYZYGY GROUP (hereinafter referred to as "SYZYGY", the "Group" or the "Company"). The consolidated financial statements on which the Group Management Report is based have been prepared in accordance with International Financial Reporting Standards (IFRS). The financial year corresponds to the calendar year.

2. Group profile

For information on the SYZYGY GROUP's structure, strategy and management, please refer to the explanatory notes in the 2023 Management Report (2023 Annual Report, page 55 ff.).

The Group consists of Syzygy AG as the holding company and seven subsidiaries:

• Ars Thanea S.A.
• diffferent GmbH
• syzygy Deutschland GmbH
• SYZYGY Digital Marketing Inc.
• Syzygy Performance Marketing GmbH
• SYZYGY UK Ltd.
• Unique Digital Marketing Ltd.

2.1. Employees

The following table shows the distribution of permanent employees by region:

09/30/2023

118

The headcount at the SYZYGY GROUP decreased during the reporting period. As of September 30, 2024, the SYZYGY GROUP had 554 permanent employees. This is a decrease of 35 employees compared to December 31, 2023 and a decrease of 73 employees compared to September 30, 2023. This is a decrease of 51 employees in the German companies compared to the same quarter of the previous year and a decrease of 23 employees in the

09/30/2023

499

72

48

8

627

112

103

108

100

86

627

UK and USA, while employment in the Poland segment was largely stable.

Employees by region

The employees by function or area of work shows a significant increase in employees in the technology sector, while all other areas are declining:

23 % Technology 16 % Strategy/consulting 16 % Project management 16 % Performance marketing 16 % Design

13 % Administration

Employees by function

On average over the period, 566 employees plus around 34 freelancers worked for the SYZYGY GROUP. Annualised sales per head were therefore EUR 117.000 (previous year: EUR 110.000).

2.2. Net assets, financial position and results of operations of the SYZYGY GROUP

2.2.1. Results of operations

Sales figures for the SYZYGY GROUP are arrived at by deducting media costs from billings. Media costs are incurred in the performance marketing companies as transitory items on the revenue and expenses side.

SYZYGY GROUP sales decreased by 3 per cent to EUR

52.6 million in the 2024 reporting period. The proportion of sales generated in Germany rose to 82 per cent. The UK & US segment contributed 7 per cent of the sales generated, while the Poland segment contributed for 11 per cent to the total SYZYGY GROUP sales.

Sales with customers in the service sector rose by 4 percentage points, while sales with customers from the consumer goods and telecommunications sectors each increased by 2 percentage points. In contrast, sales to customers in the automotive sector fell by 3 percentage points and sales to customers in the finance and insurance sector fell by 5 percentage points. The proportion of sales generated by companies that cannot be allocated to any of these five core sectors remained constant at 6 per cent.

36 % Services

18 % Automotive

18 % Consumer goods 15 % Finance/insurances

7 % Telecommunication/IT 6 % Others

Sales allocation by vertical markets

The Group generated 50 per cent of total sales with its ten largest customers. This is an increase of one percentage point compared to the same period last year.

2.2.2. Operating Expenses and depreciation

The cost of sales for services rendered fell by 5 per cent to EUR 40.3 million (previous year: EUR 42.3 million). The gross margin increased by one percentage point to 23 per cent.

Sales and marketing costs and general administration costs fell by 8 and 9 per cent respectively to EUR 3.7 million (previous year: EUR 4.0 million) and EUR 5.8 million (previous year: EUR 6.4 million).

Depreciation and amortisation of fixed assets (before goodwill amortisation) decreased by EUR 0.8 million (EUR 3.3 million compared to EUR 4.1 million in the same period of the previous year). Furthermore, EUR 4.2 million of goodwill amortisation was incurred in the previous year. The decrease is mainly due to the reduction in rental space and the associated lower depreciation of leasehold improvements.

2.2.3. Operating income and EBIT margin

The SYZYGY GROUP's operating profit (before goodwill impairment) increased year-on-year to EUR 4.3 million (previous year: EUR 3.5 million), while the EBIT margin rose accordingly to 8.2 per cent (previous year: adjusted EBIT margin of 6.4 per cent). No impairment losses on goodwill were recognised in the 2024 financial year (previous year: EUR 4.2 million).

2.2.4. Financial income

20244,324

2023 -748

20224,752

20214,616

20202,606

Operating income (in kEUR)

The SYZYGY GROUP reported a negative financial result of EUR 0.5 million after nine months (previous year: EUR -1.2 million). The financial expenses mainly result from financing costs and pro rata interest expenses for long- term contracts in accordance with IFRS 16 (primarily rental agreements).

Financial income (in kEUR)

Business performance at the SYZYGY GROUP is reflected in earnings before taxes of EUR 3.9 million. This corresponds to an increase in earnings before taxes of EUR 5.8 million. After deducting taxes of EUR 1.1 million, consolidated net income totalled EUR 2.7 million. Based on the average of 13,500,000 shares entitled to dividends and after deducting minority interests of EUR 147 thousand, basic earnings per share amounted to EUR 0.19, which is EUR 0.39 higher than in the same period of the previous year.

diffferent Berlin

20243,866

2023-1,954

20224,062

20214,051

20202,051

Income before taxes (in kEUR)

Earnings per share undiluted (in EUR)

2.2.6. Segment reporting

In accordance with IFRS 8, which is based on the management approach, the SYZYGY GROUP is reporting segments unchanged from the previous year. The UK & US segment consists of the UK companies and SYZYGY Digital Marketing in the USA. The segment Poland consists the agency business under the SYZYGY Poland brand and the CGI business under the Ars Thanea brand.

In the first nine months of 2024, the individual segments contributed to earnings as follows, compared with the same period in the previous year:

7 % United Kingdom & US

11 % Poland

Sales by segments

82 %

Germany

United Kingdom & US

2024 2023

3,806 6,327

73 409

2% 6%

7% 12%

Poland

2024 2023

5,923 4,718

888 800

15% 17%

11% 7%

2.2.7. Financial position

SYZYGY had liquidity reserves totalling EUR 4.3 million as of the balance sheet date. This corresponds to an increase of EUR 0.3 million compared to December 31, 2023. Cash and cash equivalents are almost unchanged, with a significant reduction in trade payables being financed by taking out short-term loans and from operating cash flow.

A total of 100 per cent of the funds was accounted for by bank deposits as at September 2024.

Cash flow from operating activities was positive at EUR

2.0 million in the reporting period. This is mainly due to a positive consolidated result of EUR 2.7 million, depreciation and amortisation of EUR 3.2 million and an increase in advance payments received of EUR 1.0 million, while payments of liabilities (EUR -5.6 million) had a negative impact on cash flow.

20242,002

2023 1,477

20223,689

2021 709

20203,548

Operating cash flow (in kEUR)

Total cash flow was slightly positive at EUR 0.2 million as at the reporting date.

Cash flow from investing activities was slightly positive at EUR 0.2 million. Changes in non-current assets totalling EUR 0.8 million were offset by investments in intangible assets and property, plant and equipment amounting to EUR 0.6 million.

The cash flow from financing activities is mainly characterised by repayments of lease liabilities in the amount of EUR 3.0 million and payments for the interest portion of lease obligations in the amount of EUR 0.4 million. In addition, the proceeds from the utilisation of loans exceeded the repayments of loans by EUR 1.5 million. Accordingly, cash flow from financing activities amounted to EUR -2.0 million.

2.2.8. Asset situation

Total assets of the he SYZYGY GROUP decreased by EUR 1.1 million to EUR 86.2 million in the reporting period compared to December 31, 2023, which corresponds to a decrease of 1 per cent.

Non-current assets decreased by EUR 1.3 million to EUR 61.8 million compared to the balance sheet date on December 31, 2023 (EUR 63.1 million). The main reason for this development is the EUR 1.2 million decrease in property, plant and equipment and right-of-use assets (due to depreciation).

SYZYGY Warsaw

At EUR 24.4 million, current assets are slightly above the level as of December 31, 2023 (EUR 24.2 million). The EUR 0.3 million increase in liquidity reserves was the main reason for this.

At EUR 43.3 million, equity increased by EUR 3.1 million compared to December 31, 2023. The main reason for this development is the consolidated net profit of EUR 2.7 million. In addition, there is other comprehensive income of EUR 0.5 million (previous year: EUR 0.6 million), which includes differences from the foreign currency translation of foreign business operations. The equity ratio rose by 4 percentage points to 50 per cent due to the positive consolidated result.