DGAP-News: LION E-Mobility AG: LION Smart GmbH Announces HGB Quarterly Figures as of September 30, 2021 (unaudited)

• LION Smart GmbH reports a significant increase in sales (+54.6 % to EUR 18.75 million YTD Sep) and an increase in total output (+59.2 %) compared to the previous year
• EBITDA (EUR -1,184 thousand) and EBIT (TEUR -1,434 thousand) were still negative due to high one-off expenses - see below (approx. EUR 0.751 million)
• LION Smart GmbH has undergone a TISAX(R) Assessment VDA (VDA ISA)
• The internal development and enhancements of the LIGHT Battery continue to progress rapidly
• Talks with BMW AG in connection with the acquisition of technology and production licenses continue

• Sales in Q3 were EUR 9.680 million compared to EUR 5.679 million in the same period of the previous year. After the first half of the year 2021 was below expectations, as projected a significant increase was achieved in the 3rd quarter compared to the previous year and the previous quarters.
• EBIT and EBITDA continue to be impacted by one-off expenses for rework of the Tier 1 supplier (EUR 0.309 million), for the Integration Business (EUR 0.181 million) and for high due diligence expenses (EUR 0.165 million)
• Operating cash flow negative was at EUR- 0.847 million, (Dec. 31, 2020: EUR- 0.384 million)

Garching near Munich, December 16, 2021 - LION Smart GmbH, a wholly owned subsidiary of LION E-Mobility AG, today announced its preliminary unaudited financial results for the nine months ended September 30, 2021. The business performance of the innovative supplier of lithium-ion battery systems and integrated battery solutions showed strong revenue growth compared to the previous year as well as to the previous quarters. The business continues to develop according to plan with the successful completion of the follow-up work for the development project with a Tier 1 supplier as well as the further development of the LIGHT Battery. In addition, LION Smart added information security aspects to its existing ISO 9001 management system by participating in a TISAX(R) assessment VDA. A high standard in information security is an important prerequisite for cooperation with manufacturers, suppliers and service providers, particularly in the automotive industry. This is demonstrated by participation in TISAX(R). The TISAX(R) test result can be viewed exclusively via the ENX portal.

Results of operations of LION Smart GmbH as of September 30, 2021

In the third quarter of 2021, a revenue of EUR 9.680 million was generated. In the reporting period, the revenue increased significantly compared to the previous year, but also compared to the previous quarters. Most of the revenue is attributable to the Integration Business.

The higher cost of materials and the higher materials usage ratio in the third quarter are again mainly attributable to follow-up costs for rework of the Tier 1 development project.

This is also reflected in lower gross profit compared with the prior-year period.

In order to accelerate the further development of LIGHT Battery, LION Smart GmbH continued to invest in personnel. As a result, personnel expenses rose again in the third quarter. This is due to the increase in personnel, particularly in the sales and development areas. As of September 30, 2021, the company employs a total of 39 permanent and freelance employees as well as 8 working students.

The higher depreciation and amortization (+ EUR 91 thousand) compared to the previous year results from the high investments in property, plant and equipment in the first half of 2021. No further investments were made in the third quarter.

Other operating expenses are at the level of the previous year and include high expenses for legal advice and other consulting in connection with the acquisition object in the production area. Without these non-recurring expenses, EBIT would have been significantly better.

The special effects and non-recurring expenses of EUR 751 thousand mainly relate to costs for reworking the modules of the Tier 1 development project (EUR 0.309 million), for the expansion of business in the Integration Business (EUR 0.181 million), and for due diligence in connection with technology and production licenses (EUR 0.165 million). Further expenses were incurred for TISAX certification, relocation and other consulting services.

As in the previous quarters, the financial result of LION Smart GmbH is positive (+EUR 21 thousand). On the one hand this is due to the loans granted to TÜV SÜD Battery Testing GmbH (TSBT) and the associated interest income. On the other hand interest expenses for loans received totalled EUR 21 thousand in the reporting period.

Net assets and financial position as of September 30, 2021

Total assets increased by 38.54% to EUR 15.815 million as of September 30, 2021 (December 31, 2020: EUR 11.415 million), mainly due to the increase in current trade receivables. This is mainly due to the significant increase in sales and business volume.

Non-current assets remain at the level of the previous year, with additions to intangible assets and plant, property and equipment being offset by corresponding depreciation and amortization. Financial assets, which represent our investment in TÜV SÜD Battery Testing, remained unchanged from the previous year.

Due to the higher business volume, trade receivables increased significantly by EUR 2.929 million to EUR 5.250 million as of September 30, 2021 (December 31, 2020: EUR 2.321 million), leading to an increase in current assets. Largely as a result, current assets increased significantly by EUR 4.5 million to EUR 8.384 million (December 31, 2020: EUR 3.842 million). At the same time, trade payables also increased significantly

Cash and cash equivalents amounted to EUR 0.044 million as of September 30, 2021, compared to EUR 0.515 million as of December 31, 2020, due to bank balances.

Current provisions and liabilities as of September 30, 2021 are significantly below the level of the previous year. Other provisions mainly include personnel costs such as overtime, vacation not taken and variable salary components.

The equity of LION Smart GmbH amounts to EUR 5.177 million as of September 30 of the fiscal year (December 31, 2020: EUR 6.091 million). The equity ratio as of September 30, 2021 decreased year-on-year to 32.74% (December 31, 2020: 53.36%). The reason for this is that total assets increased comparatively more strongly as a result of the aforementioned increase in current assets and current liabilities. Due to the significant increase in revenue growth, LION Smart GmbH was able to conduct its business in the third quarter without additional capital measures from LION E-Mobility AG.

Cash flow and financing as of September 30, 2021

Due to the higher cost of materials and non-recurring expenses, cash flow from operating activities deteriorated to EUR -0.847 million in the reporting period (previous year: EUR -0.384 million).

Cash flow from investing activities remains only slightly negative due to lower investments; it amounts to EUR -0.124 million as of September 30, 2021 (previous year: EUR -0.708 million). The investments were made in the first half of 2021.

The capital contributions of the shareholder in the first quarter of 2021 in the amount of EUR 0.5 million are significantly below those of the previous year and therefore so is the cash inflow in the financial area. No further capital measures were necessary in the third quarter.

In total, there were cash changes between December 31, 2020 and September 30, 2021 in the amount of EUR -0.471 million.

Outlook for the 2021 financial year

For the full year, we continue to expect sales of EUR 28-30 million. We continue to expect negative EBITDA for the full fiscal year 2021 due to the high one-time payments for certifications in the automotive area, the internal development of the LIGHT battery to series maturity, and the expected expenses for the possible acquisition of technology and production licenses for the establishment of our own battery production.

<sub>About LION E-Mobility AG:

LION E-Mobility AG is a listed Swiss holding company founded in 2011 with promising strategic investments in the e-mobility sector, especially in the field of electrical energy storage and lithium-ion battery system technology. The company owns 100% of the German LION Smart GmbH, a developer of battery packs and battery management systems. LION Smart GmbH also holds a 30% stake in TÜV SÜD Battery Testing GmbH, a joint venture with TÜV SÜD AG. LION E-Mobility AG is also the 100% owner of LION E-Mobility North America Inc.</sub>

www.lionemobility.com

Responsible for the press release: Board of Directors LION E-Mobility AG, Alessio Basteri, Chairman

 

LION E-Mobility Investor Contact

Frank Schönrock (Weber Shandwick)

Phone: +49 (0) 1737025315

E-Mail: [email protected]

Arne Siegner

Phone: +41 (0) 41 500 54 11

E-mail: [email protected]

<sub>Disclaimer:

Statements that express or imply projections, expectations, beliefs, plans, objectives and assumptions regarding future events or performance are not historical facts and may therefore be forward-looking statements. Forward-looking statements are based on expectations, estimates and plans at the time they are made and therefore involve a number of risks and uncertainties that could cause actual results or events to differ materially from those currently anticipated. LION E-Mobility AG does not undertake any obligation to update the forward-looking statements in this press release.</sub>