Governance structure

Board of Directors

The Shareholders' Meeting of Antares Vision S.p.A. on 22 February 2021 (with effect from the start of trading on the Euronext Star Milan market) appointed a nine-member Board of Directors. On 28 February 2024, having shared the proposal made by the Board of Directors to supplement the skills already present on the Board and strengthen the organisational structure of the Company, the Shareholders' Meeting resolved: (i) to expand the number of members of the Board from 9 to 10; (ii) to appoint Gianluca Mazzantini as a member of the Board until the expiry of the current Board who will remain in office until the date of approval of the financial statements at 31 December 2023. Also on 28 February 2024, the Board appointed Gianluca Mazzantini as Chief Executive Officer, granting him specific management powers. Following this appointment, Emidio Zorzella maintains the role of Chairman of Antares Vision S.p.A., with powers of representation and responsibility for high strategy, while Massimo Bonardi remains operational in the Group as Chief Technology Officer, maintaining his powers for Research and Development .

Board of Statutory Auditors

The Shareholders' Meeting of Antares Vision S.p.A. held on 22 February 2021 (with effect from the starting date of trading on the Mercato Telematico Azionario) appointed a Board of Statutory Auditors consisting of three acting members and two alternate members, which will remain in office for three years, i.e. up to the date of approval of the financial statements at 31 December 2023.

On 14 December 2023, the Chairman of the Board of Statutory Auditors Enrico Broli resigned as Acting Auditor and as Chairman of the Board of Statutory Auditors for health reasons.

On 14 December 2023, the Alternate Auditor Paolo Belleri resigned from office for strictly personal and professional reasons.

Enrico Broli was replaced on the Board of Statutory Auditors by Ramona Corti, while the Chairmanship was assigned to Germano Giancarli and Raffaella Piraccini and Francesco Mazzoletti were appointed as Alternate Auditors.

Board Committees

On 22 February 2021, subject to the start of trading on the Euronext Star Milan market, the Board of Directors followed the recommendations of the Corporate Governance Code approved by Borsa Italiana S.p.A. and appointed a Control, Risks and Sustainability Committee consisting of three non-executive, independent directors, two of whom have adequate knowledge and experience in accounting, finance and risk management.

On 22 February 2021, subject to the start of trading on Euronext Star Milan market, the Board of Directors followed the recommendations of the Corporate Governance Code approved by Borsa Italiana S.p.A. and appointed a Nominations and Remuneration Committee consisting of three non-executive, independent directors, one of whom has adequate knowledge and experience in finance and remuneration policies.

Supervisory Board

The Supervisory Board was appointed on 29 March 2021 and will remain in office until the date of the Shareholders' Meeting called to approve the financial statements at 31 December 2023.

Independent auditors

The Shareholders' Meeting of Antares Vision S.p.A. on 22 February 2021 (with effect from the start of trading on the Euronext Star Milan market) appointed EY S.p.A., with registered office in Via Meravigli 12, Milan, registered in the Ordinary Section of the Companies Register at the Milan Monza Brianza Lodi Chamber of Commerce, tax code and registration number 00434000584, REA of Milan 606158, and VAT no. 00891231003 and at no. 70945 of the Register of Legal Auditors at the Ministry of Economy and Finance pursuant to art. 6 et seq. of Legislative Decree no. 39/2010, as amended by Legislative Decree no. 135/2016, as the company appointed to audit the accounts for the financial years from 2021 to 2029.

Scope of consolidation

At 31 December, the scope of consolidation is made up as follows:

SCOPE OF CONSOLIDATION 2023
Name	Headquarters	Currency	Direct parent company	Direct investment	Indirect investment
Antares Vision Inc.	New York, USA	USD	Antares Vision S.p.A.	100.00%
Antares Vision North America LLC	New Jersey, USA	USD	Antares Vision Inc. America	100.00%	100.00%
Imago Technologies GmbH	Friedberg, Germany	EUR	Antares Vision S.p.A.	100.00%
Antares Vision do Brasil Ltda	Sao Paulo, Brazil	BRL	Antares Vision S.p.A.	99.99%
T2 SOFTWARE	Sao Paulo, Brazil	BRL	Antares Vision do Brasil Ltda	51.00%	50.99%
Pharmatrack Sistemas Ltda	Sao Paulo, Brazil	BRL	T2 SOFTWARE	73.00%	37.23%
Antares Vision France Sas	Rilleux-Pape, France	EUR	Antares Vision S.p.A.	100.00%
Antares Vision Ireland Ltd	Galway, Ireland	EUR	Antares Vision S.p.A.	100.00%
Antares Vision Rus OOO	Moscow, Russia	RUB	Antares Vision S.p.A.	100.00%
Antares Vision Asia Pacific Ltd	Hong Kong	HKD	Antares Vision S.p.A.	100.00%
FT System Srl	Piacenza, Italy	EUR	Antares Vision S.p.A.	100.00%
FT System North America LLC	Massachusetts, USA	USD	FT System Srl	100.00%	100.00%
FT Hexagon	Challes les Eaux, France	EUR	FT System Srl	100.00%	100.00%
Tradeticity Service d.o.o	Belgrade, Serbia	RSD	Tradeticity d.o.o	100.00%	82.80%
Antares Vision Germany	Friedberg, Germany	EUR	Antares Vision S.p.A.	100.00%
Applied Vision Corporation	Ohio, USA	USD	Antares Vision Inc. America	100.00%	100.00%
AV Electronics Srl	Parma, Italy	EUR	FT System Srl	100.00%	100.00%
Pen-Tec S.r.l.	Parma, Italy	EUR	FT System Srl	100.00%
rfxcel LLC	Russia	RUB	rfxcel Corporation	100.00%	100.00%
rfxcel Limited	UK	GBP	rfxcel Corporation	100.00%	100.00%
rfxcel Corporation	Delaware, USA	USD	Antares Vision Inc. America	100.00%	100.00%
Antares Vision (Shenzhen) International Trading Co., Ltd	Shenzhen, China	CNY	Antares Vision Asia Pacific Ltd	100.00%	100.00%
Antares Vision India Private Limited	Mumbai, India	INR	Antares Vision S.p.A.	99.998%
			FT System Srl	0.002%	100.00%
Innovative Marketing Digital Solutions UK Ltd	London, UK	GBP	Antares Vision S.p.A.	70.00%
Markirovka As a Service	Moscow, Russia	RUB	Innovative Marketing Digital Solutions (IMDS) UK Ltd	100.00%	70.00%
ACSIS, Inc.	New Jersey, USA	USD	rfxcel Corporation	100.00%	100.00%
Antares Vision (Thailand) Co., Ltd.	Bangkok, Tailandia	THB	Antares Vision Asia Pacific Ltd	49.00%	49.00%
Packital srl	Fidenza, italy	EUR	FT System Srl	100.00%	100.00%
Antares Vision Sagl	Lugano, Switzerland	CHF	Antares Vision S.p.A.	100.00%	100.00%
Wavision Srl	Turin, Italy	EUR	FT System Srl	60.00%	60.00%
Tradeticity d.o.o	Zagabria, Croatia	EUR	Antares Vision S.p.A.	82.80%
Antares Vision Korea Limited (*)	Seul, South Korea	KRW	Antares Vision Asia Pacific Ltd	100.00%	100.00%
SmartPoint Technologies Private Limited (**)	Chennai, India	INR	rfxcel Corporation	100.00%	100.00%
AVI Excellence Private (*)	Ahmedabad, ndia	INR	Antares Vision S.p.A.	99.998%
			Antares Vision India Private Limited	0.002%	100.00%
Shezen Andaruixin Technology Co., Ltd (**)	Shenzen, China	CNY	Antares Vision Shezen	100.00%	100.00%
(*) Company founded in 2023
(**) Company acquired in 2023

Please refer to the notes for a more detailed description of the changes in the scope of consolidation compared with 31 December 2022.

Information on the shareholders and stock performance

The share capital at 31 December 2023 amounted to Euro 169,456.78, fully paid up, divided into 69,121,137 ordinary shares, 250,000 special shares and 1,189,590 performance shares, all without par value.

At the same date, the shareholder structure was as follows:

Since 14 May 2021, Antares Vision S.p.A. has been listed on the Euronext Star Milan market, a segment of the main list of Borsa Italiana which includes the securities of medium-sized companies that adhere to stringent requirements in terms of governance, transparency and liquidity.

The ordinary shares of the Parent Company (ISIN IT000536660) are included in the following indices: FTSE All-Share Capped, FTSE Italia All-Share, FTSE Italia STAR and FTSE Italia Mid Cap.

The stock's performance with respect to the FTSE MIB is shown below.

Since June 2022, Antares Vision Group has been a member of Euronext Tech Leaders, the initiative launched in July 2022 for leading companies in the technology sector with a high growth potential. This initiative aims to expand Euronext's existing offering to strengthen the European Tech sector and accelerate the growth of the next generation of technology leaders: the companies taking part in the project will become members of an exclusive network and will benefit from a series of services dedicated to technology companies, not to mention greater visibility at an international level. Euronext's rich tech ecosystem brings together over 700 technology companies listed on the Euronext markets and a broad base of international investors who finance tech companies with significant growth profiles.

Introduction

With reference to the audit mentioned in the press release of 13 December, we would point out that the consolidated financial statements at 31 December 2023 reflect the results of the accounting and legal checks carried out during the second half of 2023 and in the early months of 2024 in relation to the Government Software Hub business (“L5 Business”) of the US subsidiary rfxcel Corp. From these checks - initiated independently by the Parent Company as part of its internal control processes - irregularities emerged relating to the accounting of rfxcel's revenues in the financial years 2021, 2022 and 2023, which were included in the consolidated financial statements of Antares. These irregularities - illustrated in greater detail in the notes - are classified as errors pursuant to IAS 8. It was therefore necessary to correct certain figures in the financial statements: in accordance with the principle contained in IAS 8, the adjustments were made retroactively, recalculating the comparative figures, as explained in the notes to the financial statements.

To summarise very briefly, the results of these checks have mainly revealed that certain members of the previous American management of rfxcel had untruthfully represented to Antares Vision the status of the contracts relating to the L5 Business. In particular, the internal investigation launched by the company revealed that rfxcel had issued invoices for services not actually carried out. Certain previous members of the subsidiary's American management had created documentation to certify the alleged execution of these services, with the consequent recording of approximately 50 million of revenue (in the period 2021-2023) which, based on the relevant accounting principles, should not have been accounted for. This conduct misled the parent company regarding the actual amount of rfxcel's revenue and the real stage of completion of the L5 Business, which was reflected in the consolidated financial statements.

The restatement of the 2022 figures meant having to review compliance with the covenants on the bank borrowings and bonds and it emerged that for all existing loans and bonds the covenants were not complied with in 2022. For this reason, as part of the restatement in accordance with IAS 8, the non-current debt subject to these covenants has all been reclassified as current liabilities.

Following the emergence of these facts, Antares Vision implemented a decisive reaction strategy which involved all the Group's control bodies, each in their area of competence, and which has so far entailed, inter alia:

i. the immediate dismissal from the Group of the persons identified as responsible for such conduct,

ii. the reorganisation of rfxcel's management,

iii. timely information to the market on the probable impact of the irregularities on the Group's economic and financial situation.

iv. the negotiation of certain amending agreements with the relevant banks which provide, inter alia, a waiver for non-compliance with the covenants in 2022 and 2023 and their remodulation starting from 2024. These agreements were signed on 27 May 2024.

Inspection pursuant to article 115, paragraph 1, letter c) - Legislative Decree no. 58 of 24 February 1998

On 5 March 2024, Consob, the National Commission for Companies and the Stock Exchange, began an inspection under article 115, paragraph 1, letter c) of Legislative Decree 24 February 1998, no. 58, regarding:

• the financial situation of Antares Vision Group;

• the items "goodwill", "other intangible assets", "trade receivables" and "revenue" recorded in the consolidated financial statements at 31 December 2022 and 30 June 2023;

• the state of implementation of the measures to adapt the organisational structure, the internal control system and the administrative-accounting system, with reference to the improvements recommended in the report of the Board of Statutory Auditors on the 2022 financial statements;

• the stage of completion of the review of the budgeting process, with particular reference to what is stated in the 2022 Sustainability Report regarding the integration of this process with ESG issues.

The inspection is still underway at the date of preparation of these consolidated financial statements. The Company's management is strongly committed to collaborating with the Supervisory Authority and is providing full support to facilitate the verification process and ensure an accurate assessment of the facts subject to the inspection.

Organisational Evolution

From an operating point of view, 2023 was characterised by a consolidation of the Group structure, which saw the creation of 4 Business Areas (LS&C, FMCG, SCT and Other) for which it was already possible to monitor their performance during the current year (for further details please refer to the section entitled "Segment reporting"). The positive effects of this reorganisation will be visible from 2024 onwards, with the aim of strengthening synergies within the Group and harmonising the organisation and technological integration of the solutions.

The actions taken so far can be summarised as follows:

Internal organisation of the Group , with a project for the definition of the organizational and operational model through the definition of planning processes, budgeting and control and review of decision-making processes with particular attention to cross-functional coordination for the implementation of a matrix model; This project was undertaken to achieve the following strategic objectives:

a) to introduce more accurate and analytical tools for monitoring the Group's performance;

b) to improve the ability to identify variances in performance, both operational and financial, and to take corrective action as soon as possible;

c) to achieve better resource allocation and closer oversight of costs;

d) to control the various measures envisaged in the business plan more effectively;

e) to refocus Top Management on specific areas of expertise with specific incentive schemes;

f) to improve risk and contingency management tools.

This evolution of the control model represents a fundamental step for the adaptation of Antares Vision to changing market dynamics and will allow the Group not only to respond better to internal and external needs, but also to maximise value for shareholders through more targeted and effective management of the various business areas, namely:

(i) Life Sciences and Cosmetics, (“LS”)

(ii) Fast Moving Consumer Good (“FMCG”),

(iii) Supply Chain Transparency (“SCT”)

(iv) Other.

These four business areas (aligned with the CGUs defined according to IAS 36) therefore represent the groups of activities on the basis of which, starting in 2023, the procedures for checking the value of the goodwill shown in the Group's consolidated financial statements are carried out.

Product Unit evolution

The following paragraphs explain some of the more important developments in the product lines offered by the Group, within the business areas outlined above.

Inspection : the range of inspection systems and machines for quality control, further strengthened by expanding and integrating the technological portfolio, has brought results in the LS&C and FMCG business area:

(i) LS&C

Automatic inspection solutions continue in the pharmaceutical sector, aimed at covering a greater variety of drugs being inspected (liquids, freeze-dried products, powders, solids and injectables) and new types of containers. We finalised an inspection machine for pre-filled syringes and created a Blow Fill Seal Cards visual inspection and leak control machine, which is innovative in terms of the new material used for the packaging and for the inspection control. The range of semi-automatic machines has been completed to guarantee a complete offer in the field of inspection machines (manual, semi-automatic, automatic), also with the use of artificial intelligence. In the field of vision systems, the path of innovation for blister filling control continues through the implementation of Blister Filling Control 3D and the use of artificial intelligence.

(ii) FMCG

The business relating to inspection controls for tethered caps continues. These caps are created to meet the European Directive 2019/904 which will come into force on 3 July 2024, making it mandatory to adopt a type of cap that remains attached to the container after opening. Partnership activities have been developed with the Global Beverage Accounts for the inspection part. To meet the needs of the brewing industry, the PCS Beer inspection solution was developed for the in-line detection, through laser spectroscopy, of leaks by measuring the total pressure in the headspace of each individual capped beer bottle. This technology overcomes the limits of the main technologies currently available on the market, such as acoustic ones.

The market penetration of food is giving good results with the All-in-One, a single machine capable of carrying out multiple quality checks; the industrialisation roadmap continues with the application of microwave technology to detect foreign bodies (i.e. physical contaminants) in packaged products, overcoming the limits of existing technologies (x-ray and metal detectors). The first applications were carried out on spreadable creams, while the diffusion and dissemination of the technologies and its potential also continues in the beverage and liquid food sectors (e.g. sauces, jams, etc.). In addition, we are continuing our expansion strategy with new foreign body inspection techniques for vertically falling products (Bulk X-Ray) and for leak control in MAP packages, exploiting the technologies already present in the Group with new applications. Among the collaborations aimed at spreading knowledge of solutions and technologies on the market, the one with the Order of Food Technologists continues.

We are continuing to work on the optimisation and efficiency-raising activities of the range of solutions for the inspection of glass containers and cans with a view to improving production, functionality, installation and use by the operator. In particular, 2023 saw a focus on improving the reliability and functionality of the Volcano® glass product inspection line with the aim of increasing business volumes. The period of the pandemic generated excess market capacity for two-piece can solutions, shifting the focus to three-piece food cans and aerosol cans, trends identified as growth opportunities. The automated inspection of decoration defects thanks to the DecoMatch® solution marks a further technological result achieved in this field. Moreover, the Genius® inspection solution for converted ends also offers flaw detection in any combination of colours, rivets or tabs through the use of multispectral light, which is a new capability.

Track & Trace: the harmonisation of the various solutions present in the Group continues, with the integration of functions and a shared roadmap for the next 3 years

(i) LS&C

The cosmetics sector has seen the acquisition of two top players as customers for the installation of pilot traceability solutions (potentially extendable on a larger scale) from Level 1 to Level 3 (as well as Level 4 as specified below) the integration process already outlined has then led to the consolidation of Digital Factory as a model for various solutions: monitoring the efficiency and productivity of production lines and plants, optimising maintenance with the use of artificial intelligence, measuring the impacts of sustainability, monitoring quality control trends, managing traceability data through the integration of primary data extracted from machines and systems for quality control (Inspection) and traceability machines (Track & Trace) and from interoperability with IoT and existing solutions. The range of functions has been expanded with the development of the Smart Clearance solution to manage the cleaning of production lines ("line clearance") and the correct planning of maintenance. This Digital Factory solution is clearly extendable to the FMCG sector.

(ii) FMCG

The food & beverage sectors have seen the implementation of track & trace solutions to meet regulations applied in certain countries. For Rigid Containers, Track & Trace is considered a development opportunity, addressed directly with targeted customers. Furthermore, as previously mentioned, the Digital Factory solution represents a further development opportunity.

Software : investments in new solutions continue to support the growth and profitability of the Group.

(iii) SCT

The expansion of the fleet of installed machines is a significant strategic condition for the implementation also of track & trace software solutions. This is happening both in the pharmaceutical sector where one of the main global groups has adopted the Group's Level 4 SW platform, and in the cosmetics sector where two top players, as mentioned previously, have adopted the complete traceability solution including Level 4.

Development of the end-to-end track & trace platform continues (from the raw material, to the transformation processes, to distribution, all the way to the end-consumer), with new supply chain projects, in the Agri-food sector and in Fashion. Supply Chain Transparency solutions (through ACSIS Inc.) have seen an increase in the management of returnable assets applied in emerging sectors such as the chemical industry. In fact, in September 2023 the Company released version 3.1 of its solution for the management of returnable assets, part of the DIAMIND Supply Chain. The new version includes an updated analysis and business intelligence engine and an improved platform for the traceability of products and variable information linked to them along the supply chain; thanks to Machine Learning and Artificial Intelligence, the automated engine generates useful information for making informed decisions, based on the data.

.

Services: this product line benefits from significant growth rates for the two operating sectors LS&C and FMCG.

(i) LS&C

As a result of the expansion of the installed fleet of machines (especially Track & Trace), and thanks to greater market penetration, after-sales assistance activities are benefiting from constant double-digit growth.

(ii) FMCG

The same trend just described is also being repeated for the FMCG business area, linked above all to inspection machines. Furthermore, part of the rigid containers business is in this context, which sees the subsidiary Applied Vision providing long-term rental services for its inspection machines.

Digital Healthcare Department : this area includes innovative products and services for the digitalisation of healthcare processes to improve efficiency, safety and traceability for the well-being of patients and healthcare workers. This product line falls within the Other business area.

(iv) Other

The first release has been available of MMP – Medication Management Platform, a hardware and software platform dedicated to hospital micrologistics, which allows you to track drugs and medical devices from their entry into the hospital to their administration to the patient. The platform includes hardware devices such as therapy carts and cabinets equipped with robotic systems that introduce levels of automation that are unparalleled in the market and are destined to set a new benchmark for healthcare markets and high-end hospital facilities. In addition to the cutting-edge "robotic" systems, the platform includes storage systems and therapy trolleys where access to drugs and medical devices is enabled by controlled access and facilitated by luminous indications that guide the operator towards the point where they have to pick up or put away drugs and devices. The benefits of the platform, available for the public and private healthcare sector, are:

- it allows operators to focus their energies on the patient rather than wasting time handling medications: orders, receiving, storage, setting up of carts, etc.

- it guarantees complete traceability of the process, eliminating dispensing errors, loss of medicines, waste due to expiring medicines, administration of batches subject to withdrawal or expired, stock-out, etc.

- it creates an automated, efficient and virtually error-free environment

- it provides full visibility of the process, allowing staff to make timely and informed decisions to administer the right dose, to the right patient, at the right time.

2024 saw the first supply completed in a hospital in Southern Italy.

ALTERNATIVE PERFORMANCE MEASURES

Antares Vision Group uses certain alternative performance measures ("APMs") to monitor equity and financial trends and its operating performance. The APMs have been drawn up in compliance with ESMA/2015/1415 guidelines.

For a correct interpretation of these APMs please note the following:

• these indicators are based solely on historical data of Antares Vision Group and do not provide any indication of future trends;

• the APMs are not required by IFRS and, even though they are derived from the consolidated financial statements of Antares Vision Group, they have not been audited;

• the APMs should not be considered as being in lieu of the indicators required by IFRS;

• these APMs must be interpreted jointly with Antares Vision Group’s financial information contained in the consolidated financial statements and accompanying notes;

• the definitions of the indicators used by Antares Vision Group, as they do not originate from the accounting principles of reference, may not be consistent with those adopted by other groups and hence may not be comparable;

• the APMs used by Antares Vision Group have been drawn up with continuity, defined and set out consistently for all periods covered by financial information included in this report on operations.

The APMs have been selected and set out in the report on operations because Antares Vision Group believes that:

• the Gross Profit, Value Added, EBITDA and EBIT (also adjusted), together with other profitability indicators, make it possible to show the changes in operating performance and provide useful information on Antares Vision Group’s ability to sustain its indebtedness; these indicators are also commonly used by analysts and investors to assess company performance;

• net financial indebtedness, together with other indicators of the composition of assets and liabilities and of financial elasticity, lead to a better assessment of Antares Vision Group's overall financial strength and its ability to maintain a situation of structural equilibrium over time;

• the net trade working capital, net working capital and net invested capital make it easier to assess the Company's ability to meet short-term commercial obligations through current trade assets, as well as the consistency between the structure of its sources and applications of funds in terms of timing.

Main consolidated income statement figures

The consolidated income statement at 31 December 2023 is set out below, reclassified according to the criteria adopted for management accounting purposes and compared with the figures at 31 December 2022 restated and 31 December 2021 restated (in thousands of Euro). Note that 2023 and 2022 are not totally comparable because of:

• the inclusion in the scope of consolidation of ACSIS, acquired on 18 February 2022 through rfxcel, and therefore present in the comparative figures for only 10 months;

• the inclusion in the scope of consolidation of Smart Point, acquired in April 2022 through rfxcel, and therefore not included in the comparative figures.

• the inclusion in the scope of consolidation of Shezen Andaruixin Technology Co.,following the increase in the shareholding from 40% to 100%

Antares Vision Consolidated income statement ('000 €)	2023	2022 Restated	2021 Restated	% Difference 2023 vs. 2022 restated	% Difference 2022 vs. 2021 restated
Revenue	213,936	200,738	169,334	6.6%	18.5%
Capitalisation of development costs	9,547	8,600	8,307	11.0%	3.5%
Operating grants and other income	1,679	989	2,088	69.8%	-52.6%
Tax credit	1,040	793	515	31.1%	53.9%
Value of production	226,202	211,121	180,245	7.1%	17.1%
Changes in inventories of raw materials and finished goods	1,668	-7,636	4,998	n.m.	n.m.
Purchases of materials	61,616	62,487	40,402	-1.4%	54.7%
Changes in inventories of work in progress	-7,421	-1,665	-3,284	>100%	-49.3%
Cost of sales	55,863	53,186	42,116	5.0%	26.3%
% of sales	26.1%	26.5%	24.9%
Commissions	4,097	3,271	3,566	25.3%	-8.3%
Installation costs	1,622	1,354	1,155	19.8%	17.2%
Gross Profit	164,620	153,310	133,408	7.4%	14.9%
% of sales	76.9%	76.4%	78.8%	0.8%	-3.1%
Leases and rentals	1,751	1,607	1,234	8.9%	30.2%
Operating costs	478	266	321	80.1%	-17.3%
Service costs	44,210	41,270	28,969	7.1%	42.5%
Value added	118,181	110,167	102,883	7.3%	7.1%
% of sales	55.2%	54.9%	60.8%
Labour	104,889	92,307	69,029	13.6%	33.7%
Employees	97,361	84,126	62,618	15.7%	34.3%
Collaborators	7,528	8,181	6,411	-8.0%	27.6%
Adjusted EBITDA	13,292	17,859	33,855	-25.6%	-47.2%
% of sales	6.2%	8.9%	20.0%
Write-down of receivables	3,715	1,864	4,948	99.3%	-62.3%
Amortisation and depreciation	12,412	10,459	6,924	18.7%	51.0%
Intangible assets	8,514	6,523	4,011	30.5%	62.7%
Property, plant and equipment	3,898	3,936	2,914	-1.0%	35.1%
Adjusted EBIT	-2,835	5,536	21,982	n.m.	-74.8%
% of sales	-1.3%	2.8%	13.0%
Financial (income) and charges	5,180	-3,233	4,125	n.m.	>100%
Net interest, fees and commissions	5,420	3,947	2,745	37.3%	43.8%
Foreign exchange gains and losses	1,377	-659	-1,511	n.m.	-56.4%
Write-ups	51	-782	-383	n.m.	103.9%
Warrants at market value	-1,668	-5,739	3,275	-70.9%	n.m.
(Extraordinary income and expenses	12,920	2,438	12,136	>100%	-79.9%
Write-down/(Write-up) of investments in associates	4,133	231	85	>100%	>100%
PPA amortisation	8,224	8,314	5,916	-1.1%	40.5%
Goodwill impairment	67,093			n.m.	n.m.
Profit before taxes (EBT)	-100,386	-2,213	-280	>100%	>100%
% of sales	-46.9%	-1.1%	-0.2%
Income taxes	-502	-1,638	4,538	-69.4%	n.m.
Profit/(loss) attributable to minority interests	-237	-72	-49	>100%	47.1%
Profit/(loss) for the year	-99,647	-503	-4,769	>100%	-89.5%
% of sales	-46.6%	-0.3%	-2.8%
Gross profit, net of capitalisations and tax credits	152,354	142,927	122,497	6.6%	16.7%
Profit margin on sales (%)	71.2%	71.2%	72.3%
Profit before taxes (EBT)	-100,386	-2,213	-280	>100%	>100%
PPA amortisation	8,224	8,314	5,916
Goodwill impairment	67,093	0	0
Extraordinary income and expenses	12,920	2,438	12,136
Write-down/(Write-up) of investments in associates	4,133	231	85
Unrealised foreign exchange gains and losses	1,377	-659	-1,511
Warrants at market value	-1,668	-5,739	3,275
Adjusted EBT	-8,306	2,371	19,621	n.m.	-87.9%
Income taxes on adjusted EBT	-502	1,178	9,153
Profit/(loss) attributable to minority interests	-237	-72	-49
Adjusted profit/(loss) for the year	-7,567	1,265	10,517	n.m.	-88.0%

The figures presented (as well as being shown with the PPA amortisation and goodwill impairment below Adjusted EBIT) are net of some extraordinary items (Euro 12.9 million), reclassified below EBIT, mainly consisting of: i) costs that Antares Vision Group incurred for the reorganisation entrusted to external consultancies (Euro 2.1 million), ii) extraordinary legal fees for the investigation and withdrawal from the Russian market (Euro 1.2 million) iii) extraordinary inventory write-downs (Euro 5.0 million), iv) write-downs of assets in Antares Vision Rus following the decision to abandon direct presence on the Russian market (Euro 2.0 million), v) write-downs of intangible assets relating to the L5 Business (Euro 1.3 million), vi) extraordinary costs linked to the Smart Point acquisition (Euro 0.5 million) and vii) other extraordinary charges (Euro 0.8 million).

The extraordinary write-downs of inventories are the result of a new business strategy introduced in 2024 by the new management team. This strategy mainly aims at two objectives: firstly, to standardise the products offered to customers; secondly, to drastically reduce stocks. As a result, the more customised inventories, including those of finished products, semi-finished products and raw materials, were valued at their estimated realisable value, considering them obsolete with respect to the Company's new strategic direction.

Sales revenue differs from Revenue in the tables provided in the notes, as they include certain accounts reclassified to Other income, as shown in the following table:

The Group's consolidated net revenue came to Euro 213.9 million, up by 6.6% or 6.4% if measured organically compared with the same period in 2022. The company acquired (Smart Point) contributed +0.1% to growth, while the exchange rate trend had a negative impact of -2.3%.

In terms of the evolution of revenue by geographical area, the highest contribution, both in absolute terms (Euro 106.6 million in 2023 versus Euro 98.1 million in 2022) and in terms of growth (+8.6%), came from Europe, driven by Italy (+12.4%). This area, after the events linked to rfxcel, appears to be the most important, with revenue equal to 49.8% of the total (48.9% in 2022).

Revenue by geographical area – 2023 vs. 2022 restated (Euro mn)

Revenue by geographical area	2023	%	2022 Restated	%	∆ '23 vs '22	∆ %
Italy	37.8	17.7%	33.6	16.7%	4.2	12.4%
Europe	68.8	32.2%	64.5	32.2%	4.3	6.6%
North & South America	84.7	39.6%	79.1	39.4%	5.7	7.2%
Asia and Oceania	14.0	6.5%	15.4	7.7%	-1.4	-9.1%
Africa and the Middle East	8.6	4.0%	8.1	4.1%	0.5	6.0%
TOTAL	213.9	100.0%	200.7	100.0%	13.2	6.6%

In 2023, North America is the area with the strongest growth (+14.4%), which more than compensates for the decrease in turnover in South America and Central America (down by 21.0% and 21.7% respectively) following the suspension of traceability legislation in Brazil. Overall, the Americas represent almost 40% of Group turnover.

Africa & the Middle East (+6.0% Y/Y) also turned in good signs of growth, while Asia & Oceania (-9.1% Y/Y) are down on last year's performance, where growth in the Middle East (+18.3%) has failed to offset the decline in Asia (-14.4%).

The table below shows sales by Business Area, which reflect the new organisation structured into 4 CGUs (please refer to the notes for further details).

Revenue by Business Area – 2023 vs. 2022 Restated (Euro mn)

Business Area	2023	%	2022 Restated	%	∆ '23 vs '22	∆ %
LS&C	99.3	46.5%	92.7	46.2%	6.6	7.1%
FMCG	70.6	33.0%	68.6	34.2%	2.0	2.8%
SCT	30.0	14.0%	30.0	14.9%	0.0	0.1%
OTHER	14.0	6.6%	9.4	4.7%	4.6	48.7%
TOTAL	213.9	100.0%	200.7	100.0%	13.2	6.6%

The Life Sciences & Cosmetics Area (" LS&C ") is confirmed as the most important sector, both in absolute terms (46.5% of total turnover) and in terms of growth (+7.1%). This positive result is attributable to a good performance by inspection machines and systems (+8.7%) and to after-sales services (+22.6%), whereas Track & Trace equipment for traceability and serialisation (T&T) is more or less stable (-0.6%). Despite the good performance in terms of turnover, equally positive results cannot be found in terms of margins ( for further information , please refer to the section on Segment Reporting).

The Fast Moving Consumer Goods Area (" FMCG ") posted growth of 2.8%, thanks to the combined effect of an excellent performance by services (+40.3%) and a decline in inspection systems (-6.8%). The latter figure was negatively influenced by the decrease in sales in the field of rigid containers, which are experiencing a period of overcapacity among their customers, who have consequently reduced investments.

The Supply Chain Transparency Area (" SCT "), which includes all Level 4 software solutions (" L4 ") and Level 5 (" L5 "), is stable despite a reduction in solutions offered in the FMCG sector (-14.5%). This decline has been offset by the good performance of the LS&C sector (+6.8%).

Lastly, the Other Area is showing significant growth of 48.7%, driven by the subsidiary Imago Technologies (manufacturer of electronic components, +13.8%) and by operations in Russia (+64.4%). As mentioned in other sections of this document, the latter will be subject to gradual downsizing, until the final liquidation of the companies held in Russia.

2023 closes with a value of production (Euro 226.2 million) up by 7.1% compared with last year (Euro 211.1 million). This result demonstrates how Antares Vision Group has managed to continue on its growth path, despite the numerous challenges, thanks to its business vision and in line with consumption trends.

The Cost of Goods Sold ( COGS ) stands at Euro 55.9 million, an increase of 5.0% compared with the figure at 31 December 2022, when it amounted to Euro 53.2 million, falling as a percentage of sales by 40 basis points thanks to the increase in the after-sales service component as mentioned previously.

Consequently, the Gross Operating Margin and Value Added respectively come to Euro 164.6 million (Euro 153.3 million at 31 December 2022, +7.4%) and Euro 118.2 million (Euro 110.2 million, +7.1%) which determines an improvement in these margin of Value Added of 30 basis points.

The Adjusted Gross Operating Profit (EBITDA) is equal to Euro 13.3 million compared with Euro 17.9 million in the previous period (-25.6%), equal to 6.2% of sales (8.9% at 31 December 2022). This result is affected by the increase in labour costs of +13.6%, accounting for Euro 104.9 million in 2023 compared with Euro 92.3 million in 2022. The Adjusted Operating Result ( EBIT ) is negative for Euro 2.8 million compared with a positive amount of Euro 5.5 million in the comparative period. This result reflects higher amortisation and depreciation following capitalisation of development costs and rights of use for the various company locations, as well as higher provisions of a prudential nature for credit risks and product warranty fund.

The following table shows the reconciliation between Operating Profit (Loss) and Adjusted EBITDA and Adjusted EBIT:

The financial element (negative for Euro 5.2 million) is influenced for Euro 5.4 million by interest and financial charges on loans, for Euro 1.4 million by the negative balance of exchange gains and losses, offset by Euro 1.7 million from recognition of the income deriving from the fair value measurement of the warrants.

All of this, together with extraordinary items (Euro 12.9 million) and the effect of the PPA (Euro 8.2 million), the write-down of investments (Euro 4.1 million) and the impairment adjustment to goodwill (Euro 4.1 million including the exchange rate effect, for which reference should be made to the specific section of these financial statements), resulted in a loss of Euro 99.6 million, net of the tax effect and the share of the loss attributable to third parties.

So to provide a clearer view of the net profit, steps have been taken to normalise it:

- the effect of the PPAs and the write-of Goodwill,

- the extraordinary items,

- exchange differences

- the effect of the warrants,

leading to an Adjusted Net Loss of Euro 7.6 million, versus a positive figure of Euro 1.3 million in 2022.

Main consolidated balance sheet figures

The statement of financial position is set out below, reclassified by sources and applications at 31 December 2023, 31 December 2022 restated and 31 December 2021 restated (in thousands of Euro):

Antares Vision Group Consolidated statement of financial position (€/000 €)	December 2023	December 2022 Restated	December 2021 Restated	% Difference 2023 vs 2022 restated	% Difference 2022 restated vs 2021 restated
Property	32,919	31,182	23,552	5.6%	32.4%
Financial assets	8,553	9,707	7,342	-11.9%	32.2%
Property, plant and equipment, net	3,504	3,571	2,986	-1.9%	19.6%
Intangible fixed assets, net	169,759	238,057	214,072	-28.7%	11.2%
Total fixed assets	214,734	282,517	247,952	-24.0%	13.9%
% of net invested capital	78.9%	82.9%	87.9%
Raw materials	26,078	33,814	26,317	-22.9%	28.5%
Work in progress	8,876	7,546	6,411	17.6%	17.7%
Finished products	13,773	6,943	4,848	98.4%	43.2%
Total inventories	48,727	48,303	37,575	0.9%	28.6%
Trade receivables	71,628	73,074	47,448	-2.0%	54.0%
Trade payables	-25,340	-23,140	-18,675	9.5%	23.9%
Advances from customers	-26,043	-30,347	-20,496	-14.2%	48.1%
Net trade working capital	68,973	67,890	45,853	1.6%	48.1%
% of net invested capital	25.4%	19.9%	16.3%
Other assets	26,127	31,567	22,949	-17.2%	37.6%
Other liabilities	-26,628	-32,300	-25,177	-17.6%	28.3%
Net working capital	68,472	67,157	43,626	2.0%	53.9%
% of net invested capital	25.2%	19.7%	15.5%
Severance indemnities	-9,516	-7,799	-8,634	22.0%	-9.7%
Provision for risks and charges	-1,690	-1,231	-965	37.3%	27.6%
Net invested capital	272,001	340,645	281,979	-20.2%	20.8%
% of net invested capital	100.0%	100.0%	100.0%
Shareholders’ equity	167,717	273,489	254,482	-38.7%	7.5%
Shareholders’ equity	167,717	273,489	254,482	-38.7%	7.5%
% of net invested capital	61.7%	80.3%	90.2%
Adjusted Net Financial Position	104,284	67,156	27,497	55.3%	144.2%
% of net invested capital	38.3%	19.7%	9.8%
Total sources of funds	272,001	340,645	281,979	-20.2%	20.8%
% of net invested capital	100.0%	100.0%	100.0%

Total fixed assets (Euro 214.7 million) shows a decrease of 24.0% compared with 31 December 2022 mainly influenced by, among other things:

• additions to property, plant and equipment for Euro 7,400 thousand;

• the impairment adjustment to goodwill of Euro 66.3 million (for which please refer to the specific section of this document);

• the inclusion in the scope of consolidation of Smart Point, which took place in April 2023 through rfxcel. The total price amounted to Euro 7.1 million, of which Euro 5.0 million was paid at the closing with the rest to be paid within 18 months. The difference between the price and the net equity of the company acquired was Euro 6.2 million and, following the Purchasing Price Allocation, at 31 December 2023 it was entirely allocated to goodwill (please refer to the specific section for further information);

• the exchange effect on goodwill already recognised at 31 December 2023, negative for Euro 3,309 thousand;

• additions to intangible assets for Euro 11,808 thousand offset for Euro 2,183 thousand by the negative exchange effect and, partially, the increase in accumulated amortisation due to the amortisation charge for the period;

• the acquisition of 15% of Isinnova by the Parent Company, which led to the recording of a stake of Euro 1,500 thousand;

• the acquisition of 38.18% of Light Scarl by the Parent Company, which led to the recording of a stake of Euro 76 thousand

• write-downs of associates for Euro 4,133 thousand, mainly related to Orobix.

Net working capital shows a slight increase, lower than the growth in sales, also as a result of a higher proportion of write-downs.

Shareholders' equity amounts to Euro 167.7 million, down by 38.7% compared with 31 December 2022, influenced by the negative result for the period of Euro 99.6 million. Please refer to the statement of changes in shareholders' equity, included in the notes, for a more detailed discussion of the changes that have affected shareholders' equity.

Main consolidated financial figures

The following is the consolidated net financial position at 31 December 2023 compared with 31 December 2022 (in thousands of Euro). The statement reflects the provisions of the ESMA32-382-1138 guideline on disclosure obligations, aimed at greater uniformity of disclosure obligations at European level.

Antares Vision Group		December 2023	December 2022 Restated
Net financial position ('000 €)
Cash at banks		43,295	61,013
Cash on hand		70	84
Cash and banks (1)	A	43,365	61,097
Cash equivalents	B	-	-
Other financial assets	C	13,248	26,827
Cash and cash equivalents and financial assets	D=A+B+C	56,613	87,924
Current lease liabilities		-3,650	-3,508
Financial liability of warrants (fair value measurement (1)		-79	0
Current financial debt (including debt instruments, but excluding the current portion of non-current financial debt)	E	-3,729	-3,508
Current portion of non-current financial debt	F	-147,338	-132,531
Current financial debt	G=E+F	-151,067	-136,039
Net current financial debt	Hrs=G-D	-94,454	-48,115
Non-current loans and borrowings		-58	0
Non-current lease liabilities		-12,884	-13,175
Financial liability of warrants (fair value measurement)		0	-1,747
Other payables of a financial nature (2)		-1,753	-11,087
Non-current financial payables	I	-14,695	-26,009
Debt instruments including negative derivative instruments	J	0	-162
Other non-current payables	K
Non-current financial debt	L=I+J+K	-14,695	-26,171
Net financial position	M=L+Hrs	-109,149	-74,286
(1) At 31 December 2023, the financial liability represented by the warrants was reclassified as current as they fell due in less than 12 months.
(2) This item includes the share of the price for the acquisition of Smart Point to be paid within 12 and 18 months (881 thousand euro at 31 December 2023) and the sums not yet redeemed by the previous shareholders of rfxcel following the sale of the company in favour of Antares Vision Group (872 thousand euro at 31 December 2023 and 11,087 thousand euro at 31 December 2022).

It is also considered appropriate to provide the financial position net of the effect of derivatives (" Adjusted net financial position ").

Antares Vision Group		31/12/23	31/12/2022 Restated
Adjusted Net Financial Position ('000 €)
Net financial position		-109,149	-74,286
Derivatives receivable (4)		4,865	7,130
Adjusted Net Financial Position		-104,284	-67,156

(4) ESMA guideline 32-382-1138 does not provide for the inclusion of derivatives receivable in the net financial position, contrary to what happens for derivatives payable.

The Net financial position is negative for Euro 109,149 thousand compared with a negative balance of Euro 74,286 thousand at 31 December 2022. The Adjusted net financial position , i.e. including derivatives receivable is negative for Euro 104.3 thousand (negative for Euro 67.2 thousand at 31 December 2022). Note that the net financial position includes the market value of the warrants (which will never correspond to an actual cash outflow) equal to Euro 79 thousand in 2023 and Euro 1,747 thousand in 2022.

The change in the Adjusted Net Financial Position compared with the same period last year is mainly influenced by:

• a positive Adjusted EBITDA of Euro 13.3 million 1 ;

• a change in net working capital, which increased by Euro 1.3 million, for the reasons explained above, to which have to be added other positive changes in provisions of Euro 2.2 million;

• additions to tangible and intangible fixed assets of Euro 19.2 million, as detailed in the previous section;

• the acquisitions of Smart Point for Euro 7.1 million and of Isinnova for Euro 1.5 million;

• interest and exchange gains and losses for Euro 5.2 million;

• extraordinary items for Euro 12.9 million.

Among the events that took place during the period which have a neutral effect on the net financial position, the following are worth noting:

• payment to the Parent Company of a Euro 2021 million bank loan by a leading credit institution (subscribed in September 2021). This forms part of the broader debt refinancing strategy launched in the second half of 2021, when the bank loan in question was negotiated with the possibility of it being disbursed at a later date. Antares Vision Group is required to comply with financial covenants in line with market practice and there is full compliance at the date of preparation of this document;

• payment to the Parent Company of a subsidised loan of Euro 1.1 million and a bank loan of Euro 0.1 million relating to the fourth progress payment according to the stage of completion of the Smart Ward Platform R&D project ("SWP”);

• the repayment of Euro 6.1 million of principal amounts of outstanding bank loans.

Main income statement figures of the Parent Company

The Parent Company's income statement at 31 December 2023 is set out below, reclassified according to the criteria adopted for management accounting purposes with comparative figures at 31 December 2022:

Antares Vision S.p.A. INCOME STATEMENT ('000 €)	2023	2022	Difference % 2023 vs. 2022
Revenue	92,215	78,125	18.0%
Capitalisation of development costs	4,198	4,781	-12.2%
Operating grants and other income	1,262	820	53.8%
Tax credit	1,040	793	31.1%
Value of production	98,714	84,519	16.8%
Changes in inventories of raw materials and finished goods	8,579	-4,219	n.m.
Purchases of materials	29,688	25,995	14.2%
Changes in inventories of work in progress	-7,663	-549	>100%
Cost of sales	30,605	21,227	44.2%
% of sales	33.2%	27.2%
Commissions	2,728	2,248	21.4%
Installation costs	1,622	1,354	19.8%
Gross Profit	63,760	59,691	6.8%
% of sales	69.1%	76.4%
Leases and rentals	396	469	-15.5%
Operating costs	166	153	8.4%
Service costs	21,338	27,017	-21.0%
Value added	41,860	32,051	30.6%
% of sales	45.4%	41.0%
Labour	38,403	33,416	14.9%
Employees	34,488	29,070	18.6%
Collaborators	3,914	4,347	-9.9%
Adjusted EBITDA	3,457	-1,365	n.m.
% of sales	3.7%	-1.7%
Write-down of receivables	7,336	812	>100%
Amortisation and depreciation	5,758	4,934	16.7%
Intangible assets	5,106	4,025	26.9%
Property, plant and equipment	652	909	-28.3%
Adjusted EBIT	-9,636	-7,111	35.5%
% of sales	-10.4%	-9.1%
Financial income and charges	6,679	-3,231	n.m.
Net interest, fees and commissions	8,023	3,339	>100%
Foreign exchange gains and losses	273	-48	n.m.
Write-ups	51	-782	n.m.
Warrants at market value	-1,668	-5,739	-70.9%
Extraordinary income and expenses	6,822	772	>100%
Write-down/(Write-up) of investments in associates	2,969	0	n.m.
Write-down of investments in subsidiaries	18,175	0	0.0%
PPA amortisation	38	0	n.m.
Profit before taxes (EBT)	-44,319	-4,652	>100%
% of sales	-48.1%	-6.0%
Income tax	-775	-856	-9.6%
Profit/(loss) for the year	-43,544	-3,796	>100%
% of sales	-47.2%	-4.9%

Gross profit, net of capitalisations and tax credits	57,261	53,033	8.0%
% of sales	62.1%	67.9%
Profit before taxes (EBT)	-44,319	-4,652	>100%
Extraordinary income and expenses	6,822	772
Write-down/(Write-up) of investments in associates	2,969	0
Write-down of investments in subsidiaries	18,175	0
Unrealised foreign exchange gains and losses	273	-48
PPA amortisation	38	0
Warrants at market value	-1,668	-5,739
Adjusted EBT	-17,710	-9,668	83.2%
Income taxes on adjusted EBT	-775	-2,030
Adjusted profit/(loss) for the year	-16,935	-7,638	>100%

The figures presented (as well as being shown with the PPA amortisation below Adjusted EBIT) are net of some extraordinary items (Euro 9.8 million), reclassified below EBIT, mainly consisting of: i) costs that Antares Vision Group incurred for the reorganisation entrusted to external consultancies (Euro 2.1 million), ii) extraordinary legal fees for the investigation and withdrawal from the Russian market (Euro 1.2 million) iii) extraordinary inventory write-downs (Euro 3.4 million), iv) the write-down of the value of investments in associates to their net equity, mainly Orobix Srl (Euro 3.0 million).

The extraordinary write-downs of inventories are the result of a new business strategy introduced in 2024 by the new management team. This strategy mainly aims at two objectives: firstly, to standardise the products offered to customers; secondly, to drastically reduce stocks. As a result, the more customised inventories, including those of finished products, semi-finished products and raw materials, were valued at their estimated realisable value, considering them obsolete with respect to the Company's new strategic direction.

Sales revenue differs from Revenue in the tables provided in the notes, as they include certain accounts reclassified to Other income, as shown in the following table:

In 2023, the Parent Company achieved Net revenue of Euro 92.2 million, up 18.0% on the same period of 2022. The growth in revenues is linked to an increase in sales volumes and the billing to subsidiaries of Headquarter Services rendered by Antares Vision S.p.A. which acts as the Group's operational holding company.

The Parent Company's sales are almost exclusively in the LS&C Business Area (around 95%), with the rest generated in the SCT Business Area. Excluding the portion of turnover derived from the billing of Headquarter Services, the operating business showed growth of 13%, both in LS&C equipment (+12%) and in LS&C Services (+21%). Sales in the SCT Area, on the other hand, show a decline of 22%.

In terms of the evolution of revenue by geographical area, the greatest contribution, both in absolute terms (Euro 61.3 million in 2023 versus Euro 50.1 million in 2022) and in terms of growth (+22.3%), came from Europe, with Italy growing by 11.9%.

Revenue by Geographical Area – 2023 vs. 2022 restated (Euro mn)

Revenue by geographical area	2023	%	2022	%	∆ '23 vs '22	∆ %
Italy	21.0	22.8%	18.7	24.0%	2.2	11.9%
Europe	40.3	43.7%	31.4	40.2%	8.9	28.5%
North & South America	21.3	23.1%	18.3	23.4%	3.0	16.7%
Asia and Oceania	4.7	5.1%	5.6	7.2%	-1.0	-17.0%
AFRICA AND THE MIDDLE EAST	4.9	5.4%	4.1	5.3%	0.8	20.3%
TOTAL	92.2	100.0%	78.1	100.0%	14.1	18.0%

The Americas, net of Headquarter cost billing, recorded growth of 8.7% ( 16.7% , including cost re-billing) driven by exports to South America (56.9%), while North America is essentially stable (+1.7%). Overall, the Americas represent almost 23.1% of the Parent Company's turnover.

Africa & the Middle East (+20.3% Y/Y) also turned in good signs of growth, while Asia & Oceania (-17.0% Y/Y) are down on last year's performance, where growth in the Middle East (+53.3%) has failed to offset the decline in Asia (-26.2%).

2023 closes with a value of production (Euro 98.7 million) up by 16.8% compared with last year (Euro 211.1 million). A result that demonstrates how Antares Vision Group has managed to continue on its growth path, despite the numerous challenges, thanks to its business vision and in line with consumption trends.

Cost of goods sold ( COGS ) stands at Euro 30.6 million, an increase of 44.2% compared with the figure at 31 December 2022 when it amounted to Euro 21.2 million, with an increase in the impact on turnover of 6.0%.

Consequently, the Gross Operating Margin and Value Added respectively come to Euro 63.8 million (Euro 59.7 million at 31 December 2022, +6.8%) and Euro 41.9 million (Euro 32.1 million, +30.6%) which determines an improvement in the Value Added of 4.4%. The improvement in profit margins derives from the decline in service costs, especially intercompany.

The Adjusted EBITDA comes to Euro 3.5 million compared with Euro -1.4 million in the previous period, equal to 3.7% of sales (-1.7% at 31 December 2022). This result is affected by the increase in labour costs of +14.9%, accounting for Euro 38.4 million in 2023 compared with Euro 33.4 million in 2022. The Adjusted EBIT is negative for Euro -9.6 million compared with Euro -7.1 million in the comparative period. This result reflects higher amortisation and depreciation following capitalisation of development costs and rights of use for the various company locations, as well as higher provisions of a prudential nature for credit risks both against third parties and subsidiaries, in addition to product warranty fund.

The following table shows the reconciliation between Operating Profit (Loss) and Adjusted EBITDA and Adjusted EBIT:

The financial element (negative for Euro 6.7 million) is influenced for Euro 5.3 million by interest and financial charges on loans, for Euro 2.7 million by write-downs of financial receivables from subsidiaries, for Euro 0.3 million by the negative balance of exchange gains and losses, offset by Euro 1.7 million from recognition of the income deriving from the fair value measurement of the warrants.

All of this, together with extraordinary items (Euro 6.8 million) and effect of the Euro 3.0 million write-down of investments in associates, of the write-down of investments in subsidiaries (Euro 18.2 million) following the test on their recoverable amount, led to a net loss of Euro 43.5 million.

So to provide a clearer view of the net profit, steps have been taken to normalise it:

- the effect of write-downs of investments,

- the extraordinary items,

- exchange differences

- the effect of the warrants,

leading to a negative Adjusted Net Result of Euro -16.9 million, versus a negative figure of Euro -7.6 million in the 2022.

Main financial figures of the Parent Company

The statement of financial position is set out below, reclassified by sources and applications as at 31 December 2023 and 31 December 2022 (in thousands of Euro):

Antares Vision S.p.A. BS ('000 €)	December 2023	December 2022 Restated	% Difference 2023 vs 2022 restated
Property	21,975	18,568	18.3%
Investments	220,015	254,057	-13.4%
Property, plant and equipment, net	581	489	18.6%
Intangible fixed assets, net	29,899	15,345	94.8%
Total fixed assets	272,470	288,460	-5.5%
% of net invested capital	84.8%	86.9%
Raw materials	10,067	19,598	-48.6%
Work in progress	3,686	2,862	28.8%
Finished products	11,931	3,275	264.3%
Total inventories	25,684	25,735	-0.2%
Trade receivables	64,258	58,078	10.6%
Trade payables	-22,624	-24,588	-8.0%
Advances from customers	-7,199	-7,853	-8.3%
Net trade working capital	60,119	51,372	17.0%
% of net invested capital	18.7%	15.5%
Other assets	11,276	12,078	-6.6%
Other liabilities	-15,828	-14,515	9.0%
Net working capital	55,567	48,934	13.6%
% of net invested capital	17.3%	14.7%
TFR	-6,153	-4,928	24.9%
Provision for risks and charges	-626	-509	22.9%
Net invested capital	321,258	331,957	-3.2%
% of net invested capital	100.0%	100.0%
Shareholders’ equity	211,436	253,541	-16.6%
Shareholders’ equity	211,436	253,541	-16.6%
% of net invested capital	65.8%	76.4%
Adjusted Net Financial Position	109,822	78,416	40.1%
% of net invested capital	34.2%	23.6%
Total sources of funds	321,258	331,957	-3.2%
% of net invested capital	100.0%	100.0%

The Parent Company's balance sheet in general is influenced by the merger with Convel in 2023.

Total fixed assets (Euro 272.5 thousand) show a decrease of 5.5% compared with 31 December 2022, mainly influenced by:

• increases (including those resulting from the merger with Convel) in tangible assets for an amount of Euro 5,690 thousand;

• the impairment adjustment to investments in associate and subsidiaries of Euro 21,144 thousand mainly due to the write-down of Orobix and the impairment test (for which please refer to the specific section of this document), to which has to be added Euro 15,771 thousand on cancellation of the carrying amount of Convel as a result of the merger;

• increases (including those resulting from the merger with Convel) in intangible assets for an amount of Euro 6,845 thousand;

• the recognition, again in net intangible assets, of the goodwill deriving from the Convel merger for Euro 12,322 thousand;

• the acquisition of 15% of Isinnova , which led to the recording of a stake of Euro 1,500 thousand;

• the acquisition of 38.18% of Light Scarl , which led to the recording of a stake of Euro 76 thousand

Net trade working capital is showing growth of 17.0%, a higher rate than the increase in turnover. As a whole, net working capital has gone up by 13.6%.

Shareholders' equity amounts to Euro 211.4 million, down by 16.6% compared with 31 December 2022, influenced by the result for the period (not adjusted for extraordinary items) negative for Euro 43.5 million. Please refer to the statement of changes in shareholders' equity, included in the notes, for a more detailed discussion of the changes that have affected shareholders' equity.

Main financial figures of the Parent Company

The following is the Parent Company's net financial position at 31 December 2023 compared with 31 December 2022 (in thousands of Euro). The statement reflects the provisions of the ESMA32-382-1138 guideline on disclosure obligations, aimed at greater uniformity of disclosure obligations at European level.

Antares Vision S.p.A.		December 2023	December 2022 Restated
Net financial position ('000,€)
Cash at banks		16,755	11,001
Cash on hand		27	44
Cash and banks (3)	A	16,783	11,045
Other financial assets	B	12,237	26,827
Cash and cash equivalents and financial assets	C=A+B	29,019	37,872
Current lease liabilities		-1,697	-1,495
Financial liability of warrants (fair value measurement (1)		-79	0
Current financial debt (including debt instruments, but excluding the current portion of non-current financial debt)	D	-1,776	-1,495
Current portion of non-current financial debt	E	-155,936	-130,804
Current financial debt	F=D+E	-157,712	-132,299
Net current financial debt	G=F-C	-128,693	-94,427
Non-current lease liabilities		-8,647	-9,254
Financial liability of warrants (fair value measurement)		0	-1,747
Non-current financial payables	Hrs	-8,647	-11,001
Debt instruments including negative derivative instruments	I	0	-162
Non-current financial debt	K=Hrs+I	-8,647	-11,164
Net financial position	L=G+K	-137,340	-105,591
(1) At 31 December 2023, the financial liability represented by the warrants was reclassified as current as they fell due in less than 12 months.

It is also considered appropriate to show the financial position including non-current financial receivables and derivatives receivable, not permitted by ESMA guidelines 32-382-1138, (“Adjusted Net Financial Position”).

Antares Vision S.p.A.		31/12/23	31/12/2022 Restated
Adjusted Net Financial Position ('000 €)
Net financial position		-137,340	-105,590
Derivatives receivable (2)		4,865	7,130
Adjusted Net Financial Position		-132,475	-98,460
Other intragroup current financial assets		22,653	20,044
Adjusted Net Financial Position including intragroup financial assets		-109,822	-78,416

(2) ESMA guideline 32-382-1138 does not provide for the inclusion of derivatives receivable in the net financial position, contrary to what happens for derivatives payable.

The Net financial position is negative for Euro 137,340 thousand compared with a negative balance of Euro 105,591 thousand at 31 December 2022. The Adjusted net financial position , i.e. including derivatives receivable, is negative for Euro 132,475 million (negative for Euro 98,460 million at 31 December 2022). Note that the net financial position includes the market value of the warrants (which will never correspond to an actual cash outflow) equal to Euro 79 thousand in 2023 and Euro 1,747 thousand in 2022.

The change in the adjusted net financial position compared with the same period last year is mainly influenced by:

• a positive Adjusted EBITDA of Euro 3.5 million 2 ;

• a change in net working capital, which increased by Euro 6.6 million, to which have to be added other positive changes in provisions of Euro 1.3 million;

• additions to tangible and intangible fixed assets of Euro 12.5 million, as detailed in the previous section;

• the financial component for Euro 6.7 million;

• extraordinary items for Euro 6.8 million.

Among the events that took place during the period which have a neutral effect on the net financial position, the following are worth noting:

• the disbursement of a Euro 20 million bank loan (taken out in September 2021) by a leading credit institution. This forms part of the broader debt refinancing strategy launched in the second half of 2021, when the bank loan in question was negotiated with the possibility of it being disbursed at a later date. Antares Vision Group is required to comply with financial covenants in line with market practice and there is full compliance at the date of preparation of this document;

• payment of a subsidised loan of Euro 1.1 million and a bank loan of Euro 0.1 million relating to the fourth progress payment according to the stage of completion of the Smart Ward Platform R&D project (" SWP ”);

• the repayment of Euro 6.1 million of principal amounts of outstanding bank loans.

Significant events

Merger by absorption of Convel S.r.l. by Antares Vision S.p.A.

The merger by absorption (the " Merger ”) of the subsidiary Convel S.r.l., a company specialising in automated inspection in the pharmaceutical industry (" Convel " or the "merged Company"), by Antares Vision S.p.A. took effect on 1 January 2023. The merger plan was approved by the two Boards of Directors on 20 June 2022 pursuant to art. 2505, second paragraph, of the Italian Civil Code.

The reason for the merger was the need to concentrate in the Parent Company the activities carried on separately by Convel, also with a view to rationalising the Group. These activities form part of the corporate purpose of Antares Vision S.p.A. and are already performed by it. The reason for the merger was the need to concentrate in the Parent Company the activities carried on separately by Convel, also with a view to rationalising the Group. These activities form part of the corporate purpose of Antares Vision S.p.A. and are already performed by it. (a) to consolidate production and commercial activities in the field of inspection machines for the pharmaceutical sector; (b) to optimise the management of resources and intra-group economic-financial flows deriving from the activities currently carried on by the individual companies; (c) to allow greater flexibility of internal processes; (d) to hold down operating costs by achieving economies of scale and maximising synergies in the various activities to avoid duplicating or overlapping certain corporate and administrative functions. The merged Company was wholly owned directly by Antares Vision S.p.A., so by applying the simplified merger procedure pursuant to art. 2505 of the Civil Code, it was not necessary to prepare the explanatory report of the administrative bodies of the company taking part in the Merger (art. 2501-quinques Civil Code), nor the experts' report on the adequacy of the exchange ratio (art. 2501-sexies Civil Code). Furthermore, as no Antares Vision S.p.A. shares are due to the shareholders of Convel, it was not necessary to determine an exchange ratio or the procedures for assigning the shares, nor the date from which these shares will participate in the profits. The Merger process comes to an end with the cancellation of the share capital of the merged Company.

Starting from the effective date of the Merger, i.e. from 1 January 2023, Antares Vision took over all of the legal relationships - debit and credit - in the name of Convel. There are no particular advantages in favour of the directors of the companies participating in the merger.

As better described in the notes, for the purposes of preparing the consolidated financial statements, the Merger did not lead to any accounting effects or treatments other than those that would have taken place without a merger.

Birth of AV Electronics as a result of the merger by absorption of Ingg. Vescovini by Tecnel

On 1 January 2023, Ingg. Vescovini (“ Ingg. Vescovini ”) S.r.l. was absorbed by Tecnel S.r.l. (“Tecnel”), which at the same time changed its name to AV Electronics S.r.l. It is based in Parma and will have the purpose of designing and supplying customised electronic hardware and software components to support the innovative developments of Antares Vision Group's technological ecosystem, mainly in inspection solutions for quality control and traceability, and to meet specific needs in the packaging sector, with highly innovative electronics.

Establishment of Antares Vision (Korea) Co. Ltd.

A new branch was established in South Korea in January 2023 and became fully operational on 1 March 2023. Under the name of Antares Vision (Korea) Co. Ltd. (“ AV Korea ”), it is wholly owned by Antares Vision Asia Pacific and will make it possible to dominate the Asian market even more through a direct presence in the area, exploiting the area's strong growth potential.

Acquisition of Isinnova

On 20 March 2023, the Parent Company took over a 15% stake in Isinnova S.r.l., the Brescia-based technological start-up of Cristian Fracassi which enables and makes technological innovation accessible with projects such as life-saving oxygen masks during the Covid-19 emergency or low-cost prostheses for Ukraine. The total amount paid for this stake is Euro 1,500 thousand. Founded in 2014, Isinnova offers itself as a research and development centre and supplier of innovation services, defining itself as a "Knowledge-Intensive Business Service". It also plays the role of intermediary, to transfer ideas and technologies from one sector in which they are created to another that has a technical requirement or a problem to be solved.

Acquisition of Smart Point Technologies

On 26 April 2023, Antares Vision Group acquired, through rfxcel, 100% of Smart Point Technologies Ltd (Smart Point), an Indian software development company that creates complex and innovative solutions. The total price amounted to Euro 7.1 million, of which Euro 5.0 million was paid at the closing with the rest to be paid within 18 months. Smart Point, which was founded in 2010 by three entrepreneurs with its HQ in Chennai, offers a wide range of software solutions and services made available to rfxcel's customers in over 30 countries. With over 12 years of experience in software development and assistance, the Company has gained expertise especially in the pharmaceutical Track & Trace sector and the solutions developed on behalf of rfxcel are directly available to the main pharmaceutical companies all over the world, which are Antares Vision Group's end-customers . In 2023 Smart Point had 154 employees in India and Germany, and in the 8 months that it has belonged to the Group it has generated a turnover of Euro 2.7 million (of which approximately 93% generated with rfxcel), with an EBITDA of approximately Euro 0.5 million. The acquisition of Smart Point has made it possible to internalise highly qualified resources with specific skills and abilities, whose know-how is a precious asset for Antares Vision Group, which continues to invest in technological development to support its growth and guide the process of innovation and digitalization of products and supply chains.

New production hub in India

AVI EXCELLENCE PRIVATE LIMITED was founded on 21 August 2023, with the aim of further developing the local market and guaranteeing direct coverage of the territory, also by creating a production site.

Acquisition of 60% of Shenzhen Antaruixin Co. Ltd

Following the termination of the joint venture agreement, in August 2023 AV (Shenzhen) International Trading Co., Ltd (“ AV Shenzhen”), in turn 100% controlled by Antares Vision Asia Pacific, acquired 60% of Shenzhen Antaruixin Ltd, previously held 40%.

rfxcel Corp.: start of audit and appointment of new CEO

On 13 December 2023, Antares Vision communicated that it had started an audit on the recoverability of its receivables relating to the supply of Government Hubs (" L5 Business ”), used to support government authorities in ensuring the implementation of new regulations on drug traceability in the United States, Africa, Asia and the Middle East. The audit – initiated by the company as part of its internal control system – focused on rfxcel Corp., a 100% American subsidiary, and became necessary following the increasing delays in the collection of receivables from the L5 Business, with the aim of estimating their recoverability. On 18 December 2023, Jeremy Coote was appointed as the new Chief Executive Officer of rfxcel and Stephanie Seibel as Head of Administrative and Treasurer. Jeremy Coote took over from Glenn Abood, who at the time of his resignation, based on the information available to the Company, was the owner of 668,198 shares of Antares Vision.

To summarise very briefly, and as highlighted in the introduction, the results of these checks have mainly revealed that certain members of the previous American management of rfxcel had untruthfully represented to Antares Vision the status of the contracts relating to the L5 business. Invoices had been issued for services not carried out, creating documentation to certify the alleged execution of such services and recording revenue of more than Euro 50 million (in the period 2021-2023) which should not have been accounted for, based on the relevant accounting principles. This conduct misled the Parent Company regarding the actual amount of rfxcel's revenue and the stage of completion of the L5 Business, which was reflected in the consolidated financial statements. These irregularities are classified as errors pursuant to IAS 8. It was therefore necessary to correct certain figures in the financial statements: in accordance with the principle contained in IAS 8, the adjustments were made retroactively, recalculating the comparative figures, as explained in the notes to the financial statements.

Request for information pursuant to art. 115 of Legislative Decree no. 58/98

On 18 December 2023, Consob (the National Commission for Companies and the Stock Exchange) sent the Company a request for information pursuant to art. 115 of Legislative Decree no. 58/98; the purpose was to request information about the audit carried out on the subsidiary rfxcel referred to in the previous point.

The Company's management provided what was requested by the deadline of 20 December 2023 (for certain information) and 15 January 2024 (for other information). The Company has also kept open a communication channel and is collaborating closely with the Authority, in order to support it in ascertaining the facts being verified and, in this context, continues to share information and documents that to help them in their supervisory activities.

Information concerning the environment and personnel

Antares Vision Group is a natural enabler of a sustainable transition and a circular economy. In line with its mission, it contributes through technology to guaranteeing end-to-end transparency of information, promoting the safety of people and of every product consumed, the traceability and typicality of the supply chains, the reduction of environmental impact and the development of marginal areas.

As a further commitment to achieve, maintain and share concrete and transparent sustainability objectives, Antares Vision Group prepares a Consolidated Non-Financial Report on an annual basis, subject to review by an independent auditing firm, pursuant to Legislative Decree 254/2016.

Sustainability and actions aimed at mitigating climate changes

The issues of climate change and its impacts are a priority in all economic, political and social areas, as well as a necessary driver in business and investment decisions.

Consequently, the market needs new metrics, new performance indicators and transparent information with respect to the economic-financial repercussions of the risks involved in climate change. In this sense, climatic impact becomes an integral element of annual reports oriented towards comprehensive corporate reporting, i.e. a convergence between financial and non-financial information.

The European Securities and Markets Authority (ESMA) has observed that it is essential that all issuers consider climate-related topics in their communications to the market, ensuring consistency of information disclosed in the directors' report, the non-financial report, financial statements and, where applicable, a prospectus. In particular, ESMA highlights that, if material, climate change risk must be considered when preparing financial statements and during the audit, assuming a longer time horizon than is usually considered for financial risk. ESMA also mentions that, in addition to the information required by the individual IFRS, according to paragraph 112 (c) of IAS 1, information on climate risk, if material, has to be provided in the notes to the financial statements.

In this context, Antares Vision Group is not particularly exposed to the risks associated with climate change, given the nature of its business, nor does it operate in sectors that are particularly vulnerable to climate and environmental risks 3 . Antares Vision has not carried out any analysis to quantify its exposure to risks related to climate change and, in any case, in recent years it has not been subject to extreme events related to climate change.

In April 2021, the European Commission published a proposal for a Corporate Sustainability Reporting Directive (CSRD) which would amend existing reporting requirements, supplementing the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) of the Financial Stability Board and allowing greater disclosure and alignment of information at a European level.

The TCFD guidelines suggest the classification of climatic and environmental risks into two macro categories:

• physical risk indicates the financial impact of climate change, including more frequent extreme weather events and gradual climate changes, as well as environmental degradation, i.e. air, water and soil pollution, water stress, biodiversity loss and deforestation. Physical risk is therefore classified as "acute" if caused by extreme events such as droughts, floods and storms, and "chronic" if caused by progressive changes such as increased temperatures, rising sea levels, water stress, loss of biodiversity, change in land use, habitat destruction and scarcity of resources. For example, this kind of risk can lead directly to physical damage or a drop in productivity, or indirectly to subsequent events such as an interruption of production chains.

• transition risk relates to the process of transition towards a low-emission and more environmentally sustainable economy. This type of risk could translate into:

o legal risks, i.e. risks deriving from legislative or policy impositions aimed at triggering the change (such as the so-called carbon tax and plastic tax);

o technology risks, i.e. risks related to necessary technological innovations leading to technical obsolescence and a need for more capital to invest in R&D and in renovating and converting the structure into technologies that are compatible with the transition;

o market risks, i.e. risks related to changes in the propensity for green consumption with a consequent decrease in demand for products that are not compatible with the transition;

o reputation risks, i.e. risks involving the relationship of trust between consumer and business, which becomes an element of differentiation in the consumer's decision-making.

These risk factors inevitably have an impact on economic activities, potentially undermining their business model in the medium to long term.

Antares Vision Group's business involves production processes with a low impact on the territory in terms of consumption of natural resources, production of industrial waste and the emission of polluting substances. In certain cases of exceptional climatic events, or in the presence of serious breakdowns or malfunctioning in the plants, Antares Vision Group's industrial production could cause damage to third parties, accidents and/or environmental damage, in addition to a slowdown in activities, exposing the Group to obligations involving compensation and/or reclamation, as well as to liability, possibly even of a criminal nature. Antares Vision Group strives to prevent this type of risk by adopting measures deemed adequate by its management and in line with industry practices.

Antares Vision Group is actively engaged in pursuing a sustainable business model both as a technological enabler, in guaranteeing the quality and safety, efficiency and sustainability of products and supply chains, and in pursuing the objectives of the United Nations 2030 Agenda and of the Sustainable Development Goals (SDGs). When drafting its first Sustainability Report (Non-Financial Report), Antares Vision Group carried out a consistency analysis of its business model, strategic objectives and projects implemented and planned, which led to the identification of those SDGs that are considered priorities as a reflection of Antares Vision Group's contribution and commitment, together with the underlying targets and actions.

The strategic guidelines of Antares Vision Group are consistent with the objective of providing a contribution to sustainable development by making the production systems of essential goods such as those of the food chain and pharmaceuticals more efficient. This is also consistent with the macro-trends and scenarios of the sector, which are subject to regulatory changes aimed at improving people's lives and reducing the impact of consuming natural resources.

The positive environmental impacts of the business model and solutions developed by Antares Vision Group , in particular Digital Factory and Supply Chain Transparency, concern the efficient use of natural resources, the adoption of the principles of a circular economy in the use of materials and the monitoring of supply chains and the total life cycle of the products.

The same solutions offered in the food and pharmaceutical sectors are available and applicable to any consumer product in order to guarantee quality, safety, originality and hence sustainability, thanks to the indissoluble link between healthy people, healthy societies and a healthy planet.

Lastly, in the context of growth and reinforcement of its competitive positioning, investments in R&D are inherent to its business and the various acquisitions, already carried out or potential, at national and international level, allow Antares Vision Group not only to expand its portfolio of technologies and solutions, but also to access human resources and specific skills, so as to strengthen its profile, also with a view to mitigating technology risk.

Commitment to the environment

Antares Vision Group periodically sets objectives for environmental improvement based on solid principles, such as:

• use in a responsible, efficient and effective way the raw materials and resources necessary for the functioning and implementation of production processes;

• optimize production processes for the progressive reduction of waste;

• conceive of and design the products and their packaging considering their entire life cycle;

• reduce energy consumption;

• reduce emissions of pollutants into the atmosphere, always paying attention to the organisation of transfers and shipments;

• reduce the use of hazardous chemicals in production cycles, or replace them with others that are safer and have a lower impact on the environment;

• where possible, replace materials that have a high environmental impact with other environmentally friendly materials;

• responsibly manage waste and apply the principles of the circular economy;

• guarantee the continuous control of direct and indirect environmental aspects through careful use of the facilities.

Each co-worker of Antares Vision Group, is involved in ensuring compliance with the requirements indicated and has to constantly improve their work and that of their colleagues, with a view to reducing the environmental impact. For this reason, in addition to what is required by current regulations, green campaigns have been launched since 2019 with the claim "Join the Green Side of Antares Vision Group", for which the Travagliato HQ is acting as the Group's driving force.

Elimination of the sale of plastic bottles from all dispensers and installed drinking fountains.

In 2019 Antares Vision Group decided to join the world campaign # PlasticFree, the #I am Environment initiative promoted by the Ministry of Environment and to anticipate the European ban on all single-use plastic products such as cutlery, dishes, straws, stirring sticks and containers. The first steps were to replace bottle dispensers with water fountains, install new coffee machines that pour liquids into paper cups and allow reusable personal containers, and distribute Antares Vision Group flasks. Antares Vision Group has also encouraged local restaurants to serve take-away food in containers made of eco-sustainable materials rather than plastic.

Paperless campaign to include all machine user manuals to be designed for digital consultation

In terms of printed documents, the quality office has replaced the packaging of the documentation provided with the machines with an eco-sustainable version and the format of the new user manuals will be designed specifically for digital consultation in such a way as to discourage over time the demand for the paper version by customers.

Implementation of Separate Waste Collection

During the years of the pandemic, a new area for separate waste collection was prepared at HQ and a best recycling practice was established for the offices, due to be launched in January 2024. In general, we have identified margins for improvement that can be achieved by adopting suitable measures within the Group which should achieve a level of separate waste collection of 95% (according to the figures at 31 December 2022, the Group is currently at a level of 60%). Furthermore, in collaboration with affiliated restaurateurs, Antares Vision Group has promoted the replacement of containers for take-out food with containers of eco-sustainable materials.

Ecological printing

In 2021, new printers with an eco ink system were introduced at the Parent Company and FT System. These have been gradually implemented with a Follow Me device, which uses personal badges to control the number of documents that are being printed.

Energy from renewable sources and vehicles with low environmental impact

The Parent Company has completely abandoned the use of natural gas in favour of electricity and in 2023 signed a supply contract with a guarantee of origin for all of the Italian sites (Travagliato, Aprilia, Sorbolo and Vicenza). Furthermore, in 2023 the Group introduced a company car policy which envisages the distribution of low environmental impact vehicles to employees to reduce emissions from the use of fuels.

Alliance for Biodiversity

In the summer of 2023, the Parent Company launched the pioneer project "Alliance for Biodiversity", for which one of the grassy plots surrounding the Travagliato headquarters will be mowed less frequently, so as to allow the flowers to flourish and form a habitat suitable for pollinating insects.

Animal pollination is the fundamental basis for the ecology of species and the functioning of ecosystems, the conservation of habitat and the provision of a wide range of important and vital human services and benefits, including the production of food, fibre, timber and other tangible products. Over 75% of the main agricultural crops and about 90% of wild flowering plants use bees, wasps, butterflies, ladybirds, spiders, reptiles, birds and mammals and pollinators in general to transfer pollen from one flower to another, allowing them to reproduce. In summary, pollination, especially entomophilous pollination (i.e. carried out by insects), is the basis not only of biodiversity, but also of our existence and our economies.

Personnel

At 31 December 2023, the Antares Vision Group had 1,401 employees, which compares with 1,186 at 31 December 2022 (+18.1%, +3.8% on a like-for-like basis). This trend can be seen in the following table which shows the number of employees per individual company, with a separate indication of the entities that joined the Group during the period in question and excluding entities without employees.

Company	Apprentices	Production workers	Office workers	Middle managers	Executives	Total at 31/12/2023		Total at 31/12/2022
Antares Vision SpA (*)	31	0	434	35	10	510		472
Imago Technologies GmbH			27			27		25
Antares Vision do Brasil Ltda			63			63		61
T2 SOFTWARE			7			7		10
Antares Vision North America			51			51		44
Antares Vision France			25			25		26
Antares Vision Ireland			2			2		2
Antares Vision Russia			62			62		55
FT System	5	26	105	5	3	144		144
FT Hexagone			7			7		7
FT System North America LLC			21			21		20
Antares Vision Asia Pacific Ltd			9			9		6
Antares Vision GmbH			7			7		8
Tradeticity			4			4		4
Tradeticity Services			23			23		28
Convel (*)			0			0		19
Applied Vision			67			67		72
rfxcel Corporation			57			57		52
rfxcel Ltd			4			4		5
rfxcel LLC			5			5		5
Pen-Tec	0	5	4	1		10		11
AVElectronics (**)	1	5	6			12		5
Antares Vision India			45			45		33
Markirovska As a Service			9			9		11
Acsis			32			32		26
Inngg. Vescovini (**)			0			0		6
Packital srl			20			20		23
Wavision			1			1		1
Antares Vision (Thailand)			7			7		5
TOTAL ON A LIKE-FOR-LIKE BASIS	37	36	1,104	41	13	1,231		1,186
Antares Vision Korea Limited			3			3
Smart Point Technologies Private Limited			154			154
Shezen Andaruixin Technologie			13			13
TOTAL	37	36	1,274	41	13	1,401
(*) Convel was absorbed by Antares Vision S.p.A. with effect from 1 January 2023.
(**) With effect from 1 January 2023, Ingg. Vescovini was absorbed by Tecnel, which at the same time changed its name to AV Electronics.

During the first half of 2024, the Parent Company launched a plan to reduce the workforce by 54 people. For further information, please refer to the chapter on Subsequent Events.

Being well aware that human capital increasingly represents a competitive advantage, the Shareholders' Meeting of the Parent Company has approved two stock option plans (the " First Stock Option Plan " and the " 4 Second Stock Option Plan ", together the " Plans ") to be implemented through the free assignment of a maximum number of options (the " Options ") for the subscription and/or paid assignment of Ordinary Shares to executive directors, top management and key employees whose performances, given their roles and functions, are more likely to influence the company's results in accordance with the guidelines already approved by the Shareholders' Meeting of 20 May 2020.

The Plans aim to establish a level of remuneration that are in line with national and international best practices, increasing the already strong retention of resources considered key by Antares Vision, by programming medium-long term objectives aimed at improving performance with a view to a progressive and ever greater creation of value, which can translate into a direct benefit for the shareholders.

With reference to the First Stock Option Plan :

• during the 2020 financial year, the first tranche corresponding to 108,000 options was assigned to executive directors and 225,000 options to top management and key employees. Of the latter, a total of 79,078 options were cancelled due to the lack of some of the vesting conditions envisaged in the plan.

• during the first half of 2021, the second tranche was assigned in favour of top management and key employees, corresponding to 333,000 options, of which 55,303 were cancelled due to the lack of some of the vesting conditions envisaged in the plan. It should be remembered that at the time of assignment, the executive directors waived the options assigned to them as part of the second vesting cycle for a total of 108,000 options in favour of the employees of the Group.

• the third tranche was assigned during the second half of 2022 in favour of top management and key employees, corresponding to 369,000 options, of which 19,560 were cancelled due to the lack of some of the vesting conditions envisaged in the plan. It should be remembered that, at the time of the assignment, the executive directors waived the options assigned to them as part of the third vesting cycle.

• During 2023, 17,550 options have been cancelled due to the lack of some of the vesting conditions envisaged in the plan.

With reference to the Second Stock Option Plan:

• the first tranche was assigned during the first half of 2021 with 425,000 options going to employees and directors who have been delegated powers, consultants and similar persons of the Parent Company and the Group. Of these, 118,463 options have been cancelled due to the lack of some of the vesting conditions envisaged in the plan.

• the second tranche was assigned during the second half of 2022 with 466,000 options going to employees and directors who have been delegated powers, consultants and similar persons of the Parent Company and the Group. Of these, 46,000 options have been cancelled due to the lack of some of the vesting conditions envisaged in the plan.

• During 2023, 1,346,930 options were cancelled due to the lack of some of the vesting conditions envisaged in the plan.

During 2023, the Plans had an effect on the consolidated income statement of Euro 1,021 thousand.

Antares Vision Group also pays considerable attention to the observance of laws and regulations on the protection of safety in the workplace and advance assessment of all possible sources of risk for workers’ health.

In order to ensure the greatest possible transparency and fairness in its actions, it has decided to summarise the lines of conduct and shared values in the Model 231, which is available for consultation by employees.

The Parent Company has ISO 45001:2018 Certification, which attests compliance with the requirements for safety and health at work management systems by all its divisions and production activities. Furthermore, following the entry into force of Legislative Decree 81/2008 that superseded Legislative Decree 626/94, external consultants have been hired to carry out the surveys required by law, also by carrying out periodic analyses of the workplaces and instrumental measurements, whose results confirm full compliance with the legal standards.

The Parent Company also entered into an agreement with its employees which provides for remote working for a maximum of 2 days per week (8 days per month) in accordance with art. 18 et seq. of Law 81/2017, putting the emphasis on organisational flexibility and helping employees to maintain a balance between life and work, while at the same time favouring an increase in productivity.

The corporate welfare project is continuing, with a dedicated platform, which includes initiatives to promote the well-being and quality of life of employees and their families.

Research and development

During 2023, Antares Vision Group continued its research and development activity and the related costs incurred were mostly charged to the income statement. In addition to the investments of previous years, during 2023 development costs were capitalised for Euro 4,070,325, once the expected future economic benefits had been verified. to which have to be added amortisation for the period of Euro 6,028,959 and a negative exchange effect of Euro 426.136. During the year, development costs relating to the L5 Business and other discontinued development projects were written down for a total of Euro 905,324, net of accumulated amortisation.

Additional investments for a total of Euro 5,991,250 have been recorded under Fixed assets in course of formation and advances as they relate to projects not yet completed at the end of the year, so amortisation has not yet commenced, plus a negative exchange effect of Euro 17,395. Development costs relating to rfxcel were then written down for Euro 141,939 as they related to the L5 Business and advances for development costs relating to Applied Vision for Euro 330,111 as after careful analysis management decided that the projects were no longer in line with the Company's development plan.

Below there is a description of the most important projects, divided by company. Management believes that these projects will have a successful outcome in terms of turnover and cost savings that will have a positive impact on the results of Antares Vision Group.

Antares Vision S.p.A.

The Parent Company concentrated on the following projects:

• Agritech Project with which Antares Vision Group intends to evolve and extend its Inspection, Track & Trace and Big Data Analytics technologies to create an ecosystem of products and services for the agro-food market and build a platform capable of guaranteeing traceability, quality and safety of the entire supply chain. The top quality segments of the food market are highly interested in being able to use such a platform to address growing consumer awareness of the issues of food quality and sustainability. The platform in the works is consistent with the circular economy models that are currently being debated, to maintain high standards of living while fully respecting the environment.

• Digital Factory , with which Antares Vision Group continues its effort to help companies improve production efficiency and quality, monitor planning and facilitate decision-making. Taking advantage of numerous features that make the software very effective in managing and extracting data, Digital Factory is a project which, also through the use of Artificial Intelligence, aims to make Antares Vision Group's Smart Data solutions able to be fully scaled up at various levels, from the single machine up to the entire company plant; it can also be integrated with other management software. Digital Factory will actively contribute to optimizing the business model through a continuous flow of data which makes communication within the organisation faster and more effective, guaranteeing savings in terms of time and costs and greater efficiency in the allocation of resources, as well as an improvement in quality, speeding up the diagnosis of problems and suggesting solutions to resolve them.

DCP – Digital Care Platform , which aims to develop a model of connected healthcare, centred on the patient, through the creation of a single and integrated platform capable of collecting data not only on patient care, but also on their lifestyle, behaviour and therapeutic adherence. The platform will be configured as a Virtual Care Solution which, with the help of artificial intelligence, will allow health and welfare organizations to provide high-quality and cost-effective care services on a remote basis.

FT System ( FOOD & BEVERAGE)

The Parent Company has combined its projects with those of FT System, the most recent of which are the first results of the synergies created following FT System's inclusion in the Group. The following is a brief description of the most representative projects.

• RoboQCS (Quality Control System) aims to create a glass container quality verification system (weight-volume, measurement of the capping torque, concentration of gas in the headspace) placed on the inspection line, through a robot that picks up the containers and performs quality tests on them in a fully automated, non-destructive manner; the containers can then be placed back on the production line as they are intact and fit to be marketed. A RoboQCS application has also been developed on quality controls for PET lines on accumulation pallets rather than on single-row lines.

• LDS (Leak Detection System) , which will be the subject of development and improvement during 2023 for systems that analyse food containers to solve the problem of micro-holes that can compromise the quality and safety of packaged foods. In this regard, the Company has explored new sensor solutions in parallel with the integration of vision systems with LDS and All in One. Resources have been invested in researching innovative solutions for the detection of micro-holes in line, overcoming current technological limits and guaranteeing a greater level of food safety.

• FOOD – Food container analysis systems : During 2023, R&D was carried out to improve food container analysis systems, with particular attention to the sealing of heat-sealed containers. These activities led to the filing of several patents and the completion of technologies for the non-destructive analysis of gas, improving food safety and production efficiency.

• Exploration of new sectors : Studies have been initiated to expand analysis systems to include the tea and coffee sectors. This has involved introducing innovative technologies and adapting existing infrastructure.

• IE 4000 and IE700 , systems for checking labels and codes on bottles and packages which in 2023 saw further development, with a simultaneous simplification of use to encourage a quicker change of label format and self-learning of the labels' position;

• Laser spectroscopy , a technology that has seen further developments and implementations in 2023, in particular for the evaluation of leaks from containers and the measurement of the internal concentration of gases in the headspace of glass and plastic bottles. The main objective of the project is to perfect the pressure measurement system in CSD (Carbonated Soft Drinks).

• Tethered caps , a project which saw the optimisation and adaptation of the bottle cap inspection system for alignment with the new EU directive 2019/904 that will come into force on 3 July 2024, introducing tethered caps (which remain attached to the container after opening); in this regard, in 2023 the "Application Angle" project saw new developments aimed at increasing the performance of the solution designed by FT System for the management of tethered caps, improving the efficiency and effectiveness of production operations;

• Microwave technology (microwaves) , a project aimed at introducing this innovation into the food and beverage inspection sector, also with the collaboration of AV Electronics and Wavision. Overall, the project aims to provide advanced solutions for identifying foreign bodies in food and beverages, ensuring greater safety and quality of packaged products through the use of microwave technology;

• AV GROUP T&T : this aims to set up inspection systems that they can manage and/or provide information relating to codes (barcode, datamatrix, QR Code) read on containers (bottles, cartons, cash registers, etc.) for product Track & Trace).

• Neural OCR : this project will make it possible to create a prototype of a Neural OCR system based on artificial intelligence with important steps forward in the field of verification of the codes required by law (expiry date, lot code, etc.)

• Empties , with the aim of creating an empty container inspection system based on artificial intelligence.

• HMI and Control System , with the aim of creating electronic control and user interface systems for container and closure inspection systems based on artificial vision.

• JUG Inspection with the aim of identifying and implementing a solution to verify the reusability of large containers of drinking water called jugs. The reusability of a jug depends on whether it is watertight and has no internal contamination.

Applied Vision (RIGID CONTAINERS)

Applied Vision concentrated on the following projects:

• Volcano Check (Polaris), a new system used for the detection of small cracks (controls) in glass bottles and jars without rotation of the goods and minimal handling of the container. Rotating and/or handling of merchandise has many disadvantages to the overall throughput of the production line, causing high rates of container deterioration and slower speed of goods through the line. On the contrary, Volcano Check will be able to significantly reduce time and costs, ensuring greater efficiency on the production line.

• Pulsary : the Electronics and Firmware teams have updated the design with new technologies, eliminating expensive terminal blocks and connectors of this important component for solutions dedicated to glass containers, as well as having introduced equipment for 100% functionality testing before the product leaves the supplier. This also helped resolve quality issues that often caused recalls of finished products.

• DecoMatch Closed Loop Software : historically, controlling ink decoration has always been a manual process. Most customers now use the automatic ink control system, which has replaced manual adjustments. The development of DecoMatch has added functionality to perform standardised evaluations of individual ink colours on a can and provide precise colour feedback to the automatic ink system. In this way, the operator's subjectivity is eliminated and the time required to perform an evaluation-adjustment-reassessment cycle is drastically reduced.

rfxcel (SUPPLY CHAIN TRANSPARENCY)

rfxcel's end-to-end traceability-focused development projects provide comprehensive visibility into every cornerstone of the supply chain, from the initial manufacturer, importers, wholesalers and distributors to pharmacies, clinics and hospitals, down to individual patients. These are:

• rTS - rfxcel Traceability System , a system initially developed for pharmaceutical applications, now being adapted for new sectors, such as food & beverage and the consumer goods market, which are very much interested in guaranteeing complete visibility of their products' supply chain. The advantages are innumerable: tracing the origin and authenticity of the products, guaranteeing their safety and allowing efficient management of stocks or recalls. The development activity saw the creation of new modules and functions aimed at increasing sales volume, ensuring the retention of existing customers and the acquisition of new ones, as well as a reduction in costs.

• Accurate Immunization Management System-Luprolink , an inventory management system intended for the Life Sciences sector for the automatic management of stocks and administration of Lupron (leuprolide acetate in the Abbvie formulation). The system includes several components that can be combined to activate the necessary functionality on a customised basis. The system manages the data acquisition and inventory management phases (with the possibility of adding new supplies to the stock, transferring and removing any damaged kits); recording patient administration data (can be integrated with EHR); management and tracking of order history and automatic reordering; analytics with the history of all activities; inventory audits, reconciliation and cancellations.During 2023, the system was updated with new modules for all system components.

REGULATIONS

Below are the most important updates regarding legislative regulations which will presumably favour the adoption and therefore the penetration of the solutions offered by the Antares Vision Group among existing and new customers.

Pharmaceutical

USA

DSCSA

The Drug Supply Chain Security Act (DSCSA) will go into effect in November 2024. This is a 10-year plan to transform the pharmaceutical supply chain in the United States by building an interoperable electronic system to identify and track certain prescription drugs as they are distributed in the United States. This will improve the FDA's ability to protect consumers from drugs that may be counterfeit, stolen, contaminated, or otherwise harmful, and will enable the detection and removal of potentially dangerous drugs from the supply chain to protect U.S. consumers.

The legislation is aimed at manufacturers, wholesalers, distributors, repackagers and logistics workers.

Beverage

UE

With Directive 2019/904, from 3 July 2024 the production obligation of so-called tethered caps will come into force, i.e. caps that must remain attached to all beverage containers with a capacity of up to three litres.

Packaging

UE

EPR, Extended Producer Responsibility: by 31 December 2024 the European Commission will have to define the rules of extended producer responsibility systems for the textile industry. In general, extended producer responsibility applies to all levels of packaging to be recycled. The OECD defines extended producer responsibility (EPR) as an environmental policy approach in which a producer's responsibility is extended to the post-consumer phase of a product's life cycle. EPR integrates signals relating to the environmental characteristics of products and production processes along the entire production chain.

Medical Devices – Identification System

UE

The unique device identification system (UDI system) foreseen in Regulation (EU) 2017/745 on medical devices and by Regulation (EU) 2017/746 on in vitro diagnostic medical devices (IVD) allows identification and facilitates device traceability.

The system assigns a basic UDI-DI which identifies a group of devices and represents the main key information of the Eudamed database, as well as the relevant documentation such as certificates and the declaration of conformity; it produces a UDI (unique device identifier) consisting of a UDI device identifier (UDI-DI) and a production UDI identifier (UDI-PI); it affixes the UDI carrier on the device label and on all external levels of packaging; it records and maintains the UDI.

The UDI system applies to all devices other than custom-made devices and those under clinical investigation or a performance study.

Food

UE

In December 2023, the European Parliament adopted a proposal to update the rules on the composition, naming, labelling and presentation of certain "breakfast" products. In the text that has been adopted, EMPs are proposing that the country where the honey was harvested should be mentioned on the label. For fruit juices, jams, jellies, marmalades and sweetened chestnut purées, the country of origin of the fruit must also be indicated on the front label. If the honey or fruit used comes from multiple countries, all countries of origin must be indicated on the label in decreasing order based on the proportion they represent in the end-product.

To limit fraud, a traceability system will be established along the honey supply chain, which will allow the origin of the product to be traced.

The proposal also aims to introduce the 'contains only natural sugars' label for fruit juices, where those whose naturally occurring sugars have been removed can be labelled as 'reduced sugar fruit juice'.

Product Sustainability

In 2015, the European Commission adopted its first action plan for the circular economy - one of the main building blocks of the European Green Deal, which over the years has been enriched with regulations for each production sector. The EU has recently added to these measures the Ecodesign for Sustainable Products Regulation (ESPR), which expands the range of goods included in the previous directive (Eco Design 2009/125). It will come into force in 2024. The objective is to establish new rules on the sustainable production of products on the European market (excluding food, medicines, feed) by increasing the characteristics of durability, reusability, repairability, recyclability and energy efficiency.

The ESPR approach involves an obligation to respect the eco-design requirements on all those who design consumer goods, to study products with characteristics that do not limit their lifespan, to make spare parts available for an adequate period and make available software updates for electronic products. Furthermore, each object must be designed so as to be easy to repair, also making repair guidelines available.

Lastly, to further encourage the circular economy, the Digital Product Passport (DPP) will officially come into force for consumer products, which will help guarantee easy access to the composition and disposal sheet of the object once it has reached the end of its useful life. The DPP will be mandatory from 2027 in certain key sectors.

Own shares and shares in Parent Companies

On 28 April 2023, the Shareholders' Meeting of the Parent Company renewed the authorisation for the purchase and disposal of treasury shares for a period of 18 months from the date of the resolution, subject to revocation of the authorisation approved by the Shareholders' Meeting of 22 April 2022.

The purpose of the buyback plan is to use any treasury shares:

• as an efficient way to invest any excess liquidity generated by the core business;

• to implement incentive plans in whatever form they are structured, or to make bonus issues to shareholders or fulfil obligations deriving from warrants, convertible financial instruments that involve mandatory conversion or which are exchangeable for shares (based on existing transactions or transactions still to be resolved or implemented);

• in operations connected with the core business or of projects consistent with the strategic lines that the Antares Vision Group intends to pursue, which could be suitable for share exchanges in order to integrate operations with potential strategic partners;

• to intervene, in compliance with current regulations, also through intermediaries, to limit anomalous movements in prices and to regularise the trend in trading and prices at times of momentary distortions caused by excessive volatility or insufficient liquidity.

The main features of the plan are the following:

• purchases can be made on one or more occasions within 18 months from the date of the resolution, up to a maximum amount of treasury shares which, taking into account the shares held from time to time by the Parent Company and its subsidiaries, is not more than 2% of the Parent Company's share capital and, in any case, in compliance with the legal limits 5 , at a unit price not lower than a minimum of 10% and no higher than a maximum of 10% with respect to the reference price that the security posted on the trading day prior to each individual transaction;

• purchases can be made on regulated markets according to operating methods established in the organisation and management regulations of the markets and agreed with Borsa Italiana S.p.A., which in any case allow respect for equal treatment of shareholders, as well as in compliance with any other applicable legislation, or in different ways, where permitted by art. 132, paragraph 3, of the aforementioned Legislative Decree 58 of 24 February 1998, or by other legal or regulatory provisions applicable from time to time at the time of the transaction, in any of the following ways: (i) public purchase or exchange offer, pursuant to art. 144-bis, paragraph 1a), of Consob Regulation 11971/1999 ibidem , following a resolution of the Board of Directors in compliance with current legislation; ( ii ) purchases carried out in ways that do not allow the direct matching of purchase proposals with certain sales proposals, in compliance with the provisions of Article 132 of the TUF and Article 144-bis, paragraph 1, letter b), of the Issuers' Regulation, or ( iii ) with any other method envisaged by the law, as assessed from time to time in relation to the best implementation of the shareholders' delegation in this sense;

• purchases, even in several tranches, must be made within the limits of the distributable profits and/or available reserves resulting from the latest financial statements approved by the Parent Company at the time of the transaction, establishing a reserve for treasury shares and, in any case, proceeding with the necessary accounting entries in the manner and within the limits of the law;

• only fully paid-up shares may be purchased;

• the administrative body, pursuant to art. 2357-ter of the Italian Civil Code, may dispose at any time, in whole or in part, on one or more occasions, even before having exhausted the purchases, of the treasury shares purchased on the basis of this resolution or in any case in the portfolio of the Parent Company, through their alienation on the market, in blocks or otherwise outside the market, accelerated book building, or the transfer of any real and/or personal rights relating to them (including, but not limited to, securities lending), with the power to establish, in compliance with the provisions of law and regulations 6 the terms, methods and conditions of the deed of disposal of treasury shares deemed most appropriate in the interest of Antares Vision Group. It is understood that such transactions may take place at the price or value or, in any case, according to criteria and conditions, which will result congruous and in line with the transaction, also taking into account the trend of the market and share prices and/or the development prospects of the issuer or the economic convenience of completing the transaction in relation to the market scenario or the transaction (including integration) to be carried out having regard to the actual implementation methods used.

Lastly, the Shareholders' Meeting explicitly clarified that, in application of the so-called "whitewash" referred to in art. 44-bis, paragraph 2, Consob Regulation 11971/1999, the treasury shares purchased in execution of the authorisation resolution will not be excluded from the ordinary share capital (i.e. they will be included in it) if, as a result of the purchase of treasury shares, it is determined that a shareholder exceeds the thresholds for the purposes of art. 106 of the Consolidated Law on Finance.

It should be noted that at the date of preparation of this document, Antares Vision Group held 33,916 treasury shares equal to 0.05% of the share capital for a total of Euro 342 thousand.

Information related to risks and uncertainties pursuant to art. 2428, para. 3, item 6-bis, of the Italian Civil Code

As regards a detailed description of the main risks and uncertainties to which the Group is exposed, please refer to the specific section of the notes.

BUSINESS OUTLOOK

On 4 March 2024, the Board of Directors of Antares Vision Group approved the strategic guidelines and objectives of the 2024-2026 Business Plan.

Over the next three years, we will continue our commitment to the strategy of growth and reinforcement of Antares Vision Group, through the organic development of the Group's activities and the launch of important projects, also thanks to the new skills deriving from the acquisitions finalised in recent years. The aim will be to further consolidate the leadership of Antares Vision Group in strategic markets and in new adjacent sectors, which will lay the foundations for the development of recurring revenues and higher margins. Antares Vision Group will continue to make decisions with a view to sustainable growth, both by promoting integration, the search for synergies and efficiencies within the Group, and by enhancing human capital and their innovation skills.

The creation of an integrated and scalable ecosystem of solutions offers the Group a unique competitive advantage; together with the new organisational model and the cost and structure efficiency, it will allow for new synergies, additional cross-selling opportunities and penetration into new markets. Antares Vision Group will therefore continue to invest in technological innovation and Research & Development, trusting in the future evolution of the sectors in which it operates.

Over the next three years, the Group will continue to pursue its growth strategy, aimed at consolidating its leadership in the markets of reference. The guidelines can be summarised in three strategic pillars.

Growth drivers:

• Consolidation of the market position , exploiting the growth trends of reference markets;

• Accelerating growth in services , increasing penetration of existing customers with an improved offer;

• Refocusing the inspection machine business , through greater expansion into the North American market;

• Acceleration of delivery times for T&T products , through the standardisation of products and simplification and acceleration of internal processes;

• New growth initiatives , continuing to invest in SW development and technological innovation and exploring new "use cases".

Cost discipline and improving profit margins:

• Optimisation of pricing strategies to protect the value of products;

• Cost reduction , through centralisation of purchasing, the reduction of expenses for external services and greater efficiency in the organisational structure;

• Greater saturation of internal staff, concentrating the activity on remunerated and profitable orders;

• Containment of the growth in fixed costs , through a new operational performance control model and a new organisational model, in order to promote cost control.

Improve cash flow:

• Optimisation of working capital , acting on all of its elements;

• Organisational focus on cash generation, through the implementation of adequate incentive schemes;

• More balanced distribution of sales over the year , improving and accelerating planning and production.

Note that in formulating its expectations, management carried out assessments based on the general principle of prudence .