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IOCHPE - MAXION MANAGEMENT REPORT – 1Q21 - MYPK B3 LISTED NM 1 ) MESSAGE FROM THE CEO The first quarter of 2021 was still marked by the pandemic . As a result , we remained focused on the health of our employees , their families and communities , through the adoption of protocols aligned with the guidelines of authorities for each location we operate . In this period , we observed a scenario of recovery in demand for motor vehicles , facing a challenging environment for the automotive industry due to the inconsistent supply of raw materials and other inputs such as semiconductors , as well as the lack of electricity and natural gas related to low temperatures in North America , observed in February . According to IHS , global automotive market ( excluding China ) increased by 0.8 % compared to the same period of the previous year , after a significant reduction of more than 20 % during the entire year of 2020. It is worth mentioning the faster growth in demand for trucks , which contributed positively to the Company's results in the Americas and Asia . In Europe , we observed an increase in sales for the trailer segment and for the aftermarket . Our net operating revenue increased 40.8 % in 1Q21 compared to 1Q20 , reaching R $ 3.1 billion , a record for the Company's quarterly revenue , driven mainly by the growth in sales in Brazil , North America and Asia , and by the exchange rate variation . We achieved an adjusted EBITDA of R $ 374.7 million in 1Q21 , another quarterly record for the Company , with a margin of 12.0 % and an increase of 78.5 % compared to 1Q20 . After three quarters of negative results , strongly impacted by the pandemic , we posted a net profit of R $ 51.5 million in 1Q21 , more than 5 times higher than the result in 1Q20 . The restructuring measures carried out in 2020 are beginning to reflect positively on the Company's results . In relation to the balance sheet , financial leverage , measured by the ratio of net debt to adjusted EBITDA in the last twelve months , was reduced from 6.46x in 4Q20 to 5.73x in 1Q21 , still negatively impacted by the results of 2020 , especially the 2Q20 . And positively impacted by the EBITDA growth starting at 3Q20 . We were able to improve our capital structure in a structural manner : ( i ) we maintained our liquidity position at R $ 1.5 billion , still a high level , due to the uncertainties arising from the pandemic ; ( ii ) we concluded the negotiation of financial covenants for the year 2021 ; ( iii ) we signed financing contracts with development banks in Brazil in the amount of R $ 940 million , with a 7 - year amortization term and up to 2 years to draw down the funds ; ( iv ) as a subsequent event , we executed our first issuance in the international capital markets with a " Sustainability - linked bond " in the amount of US $ 400 million and an amortization term of 7 years . As a result of these transactions and assuming development banks ' lines fully drawn , the average net debt term will increase from 2.2 years to 5.8 years . It is important to highlight that in this process of the bond issuance , the Company's rating ( on a global scale ) was consolidated at BB- , BB- and Ba3 with the credit rating agencies S & P , Fitch and Moody's , respectively In this bond issuance , we established a target of a 30 % reduction in greenhouse gas emission by the end of 2025. In addition , in line with our sustainability strategy , we announced a target of a 70 % reduction in this metric by the end of 2030 . These targets demonstrate lochpe - Maxion's commitment to the sustainability agenda and to our vision of an automotive sector with less emissions , which should involve greater electrification of vehicles . We are confident in achieving these targets with the continuous increase in the use of renewable energy in our factories , with the modernization of our infrastructure for the use of green gas , with the reduction of energy consumption in our activities , among other measures identified by our team . In regards to new products , in 1Q21 we successfully launched 5 new high - performance wheels for customers in Europe using our RRT development ( Reduced Rim Technology ) , a lighter and more competitive alternative to the Flow Forming production process , and we concluded 4 new contracts for the VersaStyle wheel that are expected to enter the market in early 2022 . Page 1 of 12