Interim report Q4: Further robust actions initiated to improve profitability and cash flow – gradual ramping up of EV charger deliveries to General Motors

October-December 2022

• Net sales amounted to SEK 257 million (258). Net sales declined 10% organically.

• The EVSE share of net sales rose to 30 % (19).

• Adjusted EBITA declined to SEK 13 million (21), corresponding to 5.0 % (8.1).

• The Board has decided on a new share issue for SEK 350 million with preferential rights for the company’s existing shareholders. The new share issue is fully underwritten by Investmentaktiebolaget Latour.

”As the newly appointed Interim CEO, I am not satisfied with the fourth quarter’s financial performance – despite the fact that we’ve entered a new phase with weakened private consumption and weaker construction activity. At the same time, our partnership with General Motors (GM) has led to a sharp and unforeseen increase in resources needed for development. Our focus now is to create the conditions for achieving a real improvement in profitability by substantially reducing our cost base and tied-up capital as we move forward. It is gratifying that our gross margins are stable for the existing product range, but the sharply changed product mix will have a negative impact on the Group’s gross margins moving forward”, says Ola Carlsson, acting President and CEO, CTEK.

To increase our financial flexibility and realise a considerable potential – not least in the EVSE segment without losing momentum – the Board has decided on a new share issue for SEK 350 million with preferential rights for the company’s existing shareholders. The new share issue is conditional upon an Extraordinary General Meeting to be held on 3 March and is fully underwritten by Investmentaktiebolaget Latour.

“Deliveries of the base variant of ‘Ultium Chargers’ to GM continued as planned during the quarter. Both GM and end customers are satisfied with the product, which will gradually increase in volumes. However, the previously very difficult situation in the supply chain has led to the replacement of components and very substantial cost increases which resulted in a substandard product margin. We are now working to greatly reduce the product cost, thereby improving our profitability. Despite the robust cost-saving measures, the Board has made the assessment that we need to strengthen our balance sheet through a new share issue", says Ola Carlsson, acting President and CEO, CTEK.

However, although CTEK are already seeing the effects of the actions taken, a significantly changed product mix will mean that the gross margin decreases in the order of 10 percentage points in the first quarter compared to the full year 2022. It in turn leads to the adjusted EBITA margin is expected to be lower in the first quarter of 2023 than in the fourth quarter of 2022. We anticipate a gradual improvement during the year, however, with an estimated double-digit adjusted EBITA margin in the fourth quarter. Furthermore, EVSE sales are expected to account for about half of the Group’s net sales for full-year 2023, while a reduced working capital requirement should lead to one positive cash flow for the full year 2023.

Today, 8 February at 09:00 CET, CTEK will hold an audiocast in English. CTEK is represented by acting CEO Ola Carlsson and CFO Thom Mathisen, who present the full year report and answer questions. To participate or for further information - https://financialhearings.com/event/44125

Before its publication, this information was inside information and is such that CTEK AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, on 8 February 2023 at 07:30 CET.

For further information please contact:

Niklas Alm, Investor Relations, +46 708 24 40 88, niklas.alm@ctek.com

About CTEK

Established in Dalarna Sweden, CTEK is the leading global brand in battery charging solutions, most specifically vehicle charging.

CTEK offers products ranging from 12V & 24V battery chargers to charging solutions for electrical vehicles.

Products are sold via a carefully selected network of global distributors and retailers, as original equipment, supplied to more than 50 of the world’s leading vehicle manufacturers and through charge point operators, property owners as well as other organisations and individuals providing EV charging infrastructure.

CTEK takes pride in its unique culture based on a passion for innovation and a deep commitment to supporting the transition to a greener mobility, by adhering to industry-leading ESG standards.

CTEK's share is listed on Nasdaq Stockholm Mid Cap and is traded with the ticker CTEK.

For more information, also visit www.ctekgroup.com