Page 1

REKA INDUSTRIAL Reka Industrial Plc : Profitable growth 21.10.2021 09:00:00 EEST | Reka Industrial Oyj | Interim report ( Q1 and Q3 ) January - September 2021 ● ● The Group's turnover was EUR 118.3 million ( EUR 86.7 million ) EBITDA was EUR 9.1 million ( EUR 6.4 million ) Operating result was EUR 4.9 ( 2.7 ) million The result for the period was EUR 1.1 ( 0.2 ) million Near - term outlook remains the same : In 2021 EBITDA ( EUR million ) is expected to improve , provided that predominant conditions due COVID - 19 pandemic will not substantially affect to the company's capability to deliver . EBITDA will also be affected to what extent and how quickly we are able to pass on the continuous increase in material costs to sales prices as well as metal price fluctuations . Figures in brackets refer to the same period a year earlier , unless otherwise stated . Reka Rubber , acquired in 2020 , was merged with the Group on June 30 , 2020 . Interim report is unaudited . MANAGING DIRECTOR JUKKA POUTANEN : In January - September , turnover increased significantly in both the cable and rubber industries . EBITDA has been improved despite the procurement and delivery capacity challenges of the industries . In the cable industry , we have succeeded in serving our customers reliably despite ongoing sourcing challenges . In addition to the increase in turnover , this is reflected in the development of the cable industry's EBITDA . In January - September , turnover increased significantly . About half of the turnover increase in the cable business is explained by rising metal prices . The impact of higher metal prices on the value of inventories and the net effect of metal and currency hedging supported the cable industry's EBITDA by approximately EUR 0.3 million , compensating sharply and unprecedentedly high acquisition costs , which can only be passed on to customer prices with a delay . In the rubber industry , customer order volumes have grown strongly . The turnover of Polish production personnel has been high and the increase in production volumes has not been successful . Despite overtime and temporary labour , our delivery capacity has been poor , especially for Polish hose production . EBITDA is burdened by delivery capacity issues and additional costs . The main focus of the remedial measures is now on increasing the production capacity of hose production and streamlining the production process . Changes in production also improve the personnel situation . The prioritized measures will be completed mainly in the first quarter of 2022 . Cable business has made decision to increase production facilities space within Riihimäki factory . The additional space will be available in mid - 2023 . The demand situation in both industries is good . COVID - 19 and supply chain logistics have required a lot of effort to ensure material deliveries . Both material prices and costs of logistics have continued to rise strongly . The Nordic cable market is growing and is expected to grow in the coming years . Our market share in Finland is strong and we aim to increase our market share in the other Nordic countries . The rubber industry has a strong position in its selected market segments . Especially in construction equipment , the market share continues to grow . Enquiries in the truck industry have grown from before . Green Bond funded projects have been taken forwards and new ones are ongoing . In the cable industry , investments have been made , specially to the projects relating to wind power and decreasing energy consumption . The rubber industry is currently working with customers on prototypes and pre - kits for products needed for electric commercial vehicles . Related volume deliveries will begin in 2023 . MAJOR EVENTS DURING THE FINANCIAL PERIOD In January 2021 Reka Cables Ltd made an agreement of EUR 5.0 million loan limit . The limit is fixed term . There are covenant terms associated with the loan limit .