Equity Case

Source of wealth for the past twelve months up to the third quarter of 2025:

In 2025, the Monbat Group achieved record consolidated sales revenue of over €206 million (BGN 403 million), marking an increase of nearly 5% compared to 2024.

Risk analysis, measures taken and financial results achieved:

In 2025 the Group reported a 2.6% decline in sales revenue from rechargeable batteries as a result of lower lead exchange rates (see below), although the volume of batteries sold was 2.6% higher than in the comparative period. The Group sold 3,355 thousand batteries, with the following specifics by geographical and product segments:

Significant growth in battery sales in target high-margin markets such as South Africa and Israel, which offset the lack of sales to customers in Saudi Arabia, where in 2024 significant volumes were realised, albeit at low profitability, as well as lower sales to specific customers in Spain and Ukraine.

In 2025, sales to Saudi Arabia were externally constrained by the negative effects of the volatility of the euro-dollar exchange rate and the significant depreciation of the US currency, which is traditionally traded in the Middle East region.

A 14% increase in sales of storage batteries and raw materials for their production (lead plates) by the Nur Tunisia Industrial Group to counterparties in Europe and especially North Africa, while maintaining its leading role in the local Tunisian market.

In addition to the Group’s core business – the production and sale of rechargeable batteries – in 2025, the other segments of the Monbat Group reported significant sales growth, expressed as follows:

A substantial 98% increase in sales of lead and lead alloys from the Group’s recycling plants to third countries, including raw lead produced by the new metallurgical furnace commissioned in early 2025. at the Group’s recycling plant in Italy ( ). In 2025, the Group’s recycling companies sold over 9,700 tonnes of lead and lead alloys to third parties.

Higher revenues from consulting, engineering and logistics services provided by the Group’s companies.

Due to market volatility, the average stock market price of lead in 2025 was around EUR 1,742/MT (2024: EUR 1,916/MT). Although the Group traditionally addresses market volatility and the dependence of the price of lead on stock market indices by applying standard indexation to the sales prices of its products and purchases of lead-containing raw materials, in the second quarter of 2025 the Group reported a significant negative effect on its profitability (of over BGN 3 million) as a result of the above-mentioned collapse in the price of lead and the realisation of available material stocks at lower, downwardly indexed sales prices.

In order to ensure the collectability of its receivables from Ukrainian counterparties, for which no trade receivables insurance is available in the context of the ongoing military conflict, the Group adopted a policy of 100% advance payments prior to shipment for all export sales to Ukraine after the start of military operations in the country. With regard to receivables outstanding at the start of the military conflict, the Group reported impairment losses related to them of BGN 0 in 2025 and BGN 3,502 thousand in 2024. As at 31 December 2025, the Group has trade receivables from Ukrainian customers with a net carrying amount of BGN 4,144 thousand.

In 2025, the European Central Bank (ECB) lowered its base interest rates four times with a total effect of 100 basis points. As a result, the Group reported a decrease in net financing costs of BGN 1,935 thousand, or 17% compared to 2024. In 2024, the line “Income from financial instruments” in the Interim Condensed Consolidated Income Statement includes a one-off positive effect of BGN 2,640 thousand, resulting from an accounting revaluation of the option to convert the Group’s bond issue, which was fully redeemed in January 2025.

At the end of 2025, Monbat AD signed an agreement to acquire a 40% minority stake in the Tunisian company Societe Nouvelle des Accumulateurs NOUR. Upon completion of the transaction, Monbat AD will own 100% of the capital of Industrial Group Nur Tunisia. The total value of the transaction amounts to EUR 9 million, payable in three instalments. The transaction is expected to be finalised in the first half of 2026.

The Group constantly analyses all possible impacts of changing micro- and macroeconomic conditions on the Group’s future financial position and results of operations. Inflationary processes, reflected in increased costs of direct materials and labour per unit of output, have a significant impact on the Group’s operations. The Group manages to limit the effect of these negative impacts of the macroeconomic environment by refining its customer and product mix (with a focus on high-margin products and markets) and indexing sales prices to its customers for specific product groups.