Commentary on the preliminary estimated financial results of STALPROFIL SA for the second quarter of 2025.

The Company's estimated standalone results for Q2 2025 show an increase in sales revenues of PLN 24,736 thousand (+10% y/y). Despite the recorded increase in the volume of goods sold and the value of revenues, the Company generated an estimated net financial result of PLN 1,232 thousand (-53% y/y). Q2 2025 was another period in which the economic downturn in the steel distribution market adversely affected the Company's results. In Q2 2025, the difficult market conditions prevailing in the EU steel market negatively impacted the prices of steel products, trade margins, and, consequently, the results generated by market participants. The economic downturn, which has been ongoing since Q2 2022, contributed to a decline in apparent steel consumption in the EU in 2023 and 2024 (-6% and -1.1% year-on-year, respectively). Also in 2025, according to EUROFER's June forecast, apparent steel consumption is expected to decline further by -0.9% year-on-year, representing a significant downward revision compared to the previously forecasted increase (+2.2% year-on-year). This is largely due to the anticipated decline in production in steel-consuming sectors and the negative impact of US tariffs and the resulting uncertainty and disruptions related to steel trade. One of the main reasons for the decline in prices and margins is the import of steel products from third countries, coupled with the lack of effective mechanisms to protect the European steel market. During the period of economic downturn on the steel distribution market, the strategy adopted for the Group is bringing tangible results, which is based on the diversification of activities within four business areas (steel trade, production of steel structures, production of anti-corrosion insulation and construction of gas pipelines), grouped within two basic industry segments (steel segment and infrastructure segment). Thanks to the diversification of its operations, the STALPROFIL S.A. Capital Group generated satisfactory results compared to the market in H1 2025. The Group's estimated revenues for H1 2025 amounted to PLN 1,182,866 thousand (+60% y/y), while the estimated net profit reached PLN 6,996 thousand (-44% y/y). The presented results are estimates and may change until the publication of the semi-annual report for H1 2025, which the Company intends to publish on September 2, 2025.