Financial Tables

Income Statement (EURm) 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E Revenues 7.40 9.53 11.55 16.07 19.37 22.28 27.00 30.80 34.05 36.67 Production costs (2.75) (3.48) (4.46) (5.22) (6.31) (7.58) (8.37) (9.24) (9.53) (9.53) Gross profit 4.65 6.05 7.08 10.86 13.06 14.71 18.63 21.56 24.52 27.13 Sales costs (2.32) (3.55) (4.50) (6.29) (7.72) (9.36) (11.34) (12.78) (13.96) (14.85) Administrative costs (1.08) (1.12) (1.29) (1.22) (1.52) (1.69) (2.16) (2.39) (2.64) (2.75) Other operating income 0.19 0.17 0.26 0.44 0.38 0.44 0.48 0.51 0.53 0.56 Other operating costs (0.08) (0.07) (0.08) (0.25) (0.18) (0.18) (0.19) (0.20) (0.21) (0.22) Operating profit 1.35 1.47 1.48 3.53 4.03 3.91 5.42 6.69 8.24 9.87 Depreciation & Amortization 0.42 0.52 0.71 0.73 0.68 0.94 1.20 1.89 2.52 2.72 EBITDA 1.77 1.99 2.18 4.27 4.70 4.85 6.62 8.59 10.76 12.59 Financial income 0.00 0.06 0.11 0.06 0.00 - - - - - Financial expenses (0.03) (0.02) (0.02) (0.03) (0.01) (0.00) (0.06) (0.11) (0.08) (0.06) Pre-tax profit 1.33 1.52 1.56 3.56 4.01 3.91 5.36 6.59 8.15 9.81 Income tax (0.16) (0.00) - (0.12) (0.35) (0.47) (0.43) (0.62) (0.75) (0.93) Deferred income tax 0.07 - - - - - - - - - Net profit 1.25 1.52 1.56 3.45 3.67 3.44 4.93 5.97 7.40 8.88

Nr of shares (m) 3.75 3.75 3.75 3.77 3.77 3.77 3.77 3.77 3.77 3.77 EPS 0.33 0.40 0.42 0.91 0.97 0.91 1.31 1.58 1.96 2.36 Dividends paid 0.20 0.34 0.45 0.56 1.51 1.89 1.72 2.46 2.98 3.70 DPS 0.05 0.09 0.12 0.15 0.40 0.50 0.46 0.65 0.79 0.98 Source: MADARA for historicals, LHV for estimates

Balance Sheet (EURm) 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E Assets Intangible assets 0.14 0.38 0.68 0.67 1.11 1.36 0.73 1.06 1.33 1.26 Fixed assets 1.66 2.06 2.24 2.25 2.91 3.50 6.56 9.54 11.95 11.32

Leased fixed assets 0.48 0.45 0.45 0.38 - - - - - -

Machinery and equipment 0.75 0.86 1.09 1.09 - - - - - -

Other fixed assets 0.40 0.50 0.65 0.55 - - - - - -

Construction in progress 0.01 0.24 0.02 0.03 - - - - - -

Advance payments for fixed assets 0.01 0.00 0.03 0.20 - - - - - - Long term financial assets 0.04 0.04 0.07 0.07 0.08 0.08 0.08 0.08 0.08 0.08

Subsidiaries - - - - - - - - - -

Other securities and investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Other long-term receivables 0.04 0.04 0.07 0.07 0.08 0.08 0.08 0.08 0.08 0.08 Total non-current assets 1.84 2.48 2.99 2.98 4.10 4.95 7.37 10.68 13.36 12.66 Inventory 1.63 2.09 2.98 4.22 4.33 5.03 5.79 6.60 6.85 6.68

Raw materials and consumables 0.86 1.04 1.56 2.00 - - - - - -

Finished goods 0.67 0.88 1.20 1.67 - - - - - -

Advance payment for goods 0.10 0.17 0.23 0.55 - - - - - - Total receivables 1.06 1.15 1.78 1.33 1.68 2.15 2.50 2.87 3.13 3.37

Trade receivables 0.92 0.99 1.35 1.21 1.46 1.94 2.29 2.66 2.92 3.16

Amounts owed by public debts - - - - - - - - - -

Other receivables 0.10 0.11 0.37 0.09 0.19 0.19 0.19 0.19 0.19 0.19

Prepaid expenses 0.03 0.05 0.06 0.04 0.03 0.02 0.02 0.02 0.02 0.02

Balance Sheet (EURm)...continued 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E Short-term fin. Investments 0.50 0.70 0.95 - - - - - - - Cash and cash equivalents 4.09 3.43 2.33 5.65 6.60 6.34 10.32 8.87 9.43 14.48 Total current assets 7.28 7.36 8.04 11.20 12.61 13.52 18.62 18.34 19.41 24.52 Total assets 9.12 9.85 11.03 14.19 16.71 18.47 25.99 29.02 32.77 37.18

Equity and Liabilities Equity Share capital 0.37 0.37 0.37 0.38 0.38 0.38 0.38 0.38 0.38 0.38 Share premium 4.02 4.02 4.02 4.02 4.02 4.02 4.02 4.02 4.02 4.02 Other reserves - - - - - - - - - - Retained earnings 1.61 2.52 3.58 4.58 6.52 8.30 10.02 12.49 9.50 5.80 Net profit for the period 1.25 1.52 1.56 3.45 3.67 3.44 4.93 5.97 13.37 22.26 Total equity 7.25 8.43 9.55 12.43 14.59 16.14 19.35 22.86 27.28 32.46 Liabilities Bank Borrowings 0.24 0.11 0.01 - - - 4.00 3.20 2.40 1.60 Other liabilities 0.18 0.14 0.08 0.03 0.00 0.00 0.00 0.00 0.00 0.00 Deferred income-Current 0.15 0.06 - - - - - - - - Deferred tax liabilities - - - - - - - - - - Total non-current liabilities 0.57 0.31 0.09 0.03 0.00 0.00 4.00 3.20 2.40 1.60 Bank Borrowings 0.14 0.14 0.10 0.01 - - - - - - Advances from customers 0.08 0.02 0.05 0.08 0.07 0.10 0.12 0.14 0.16 0.17 Trade payables 0.54 0.36 0.50 0.63 0.94 0.94 1.10 1.27 1.30 1.27 Related party debt - - - - - - - - - - State social insurance contributions 0.12 0.10 0.15 0.16 0.30 0.30 0.30 0.30 0.30 0.30 Other liabilities 0.16 0.18 0.21 0.25 0.26 0.35 0.39 0.44 0.47 0.49 Deferred income 0.09 0.09 0.06 - 0.02 0.02 0.03 0.03 0.03 0.04 Unpaid previous year dividend - - - - - - - - - - Accrued liabilities 0.17 0.21 0.32 0.61 0.53 0.61 0.69 0.77 0.82 0.86 Total current liabilities 1.29 1.11 1.39 1.73 2.12 2.32 2.63 2.96 3.09 3.12 Total liabilities 1.87 1.41 1.48 1.76 2.12 2.32 6.63 6.16 5.49 4.72 Total equity and liabilities 9.12 9.85 11.03 14.19 16.71 18.47 25.99 29.02 32.77 37.18 Source: MADARA for historicals, LHV for estimates

Cash Flow Statement Summary (EURm) 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E Operating Activities Net profit 1.33 1.52 1.56 3.56 4.01 3.91 5.36 6.59 8.15 9.81 Depreciation and amortisation 0.41 0.46 0.61 0.55 0.46 0.94 1.20 1.89 2.52 2.72

Other non-cash adjustments (0.34) (0.27) (0.25) (0.26) (0.52) (0.47) (0.49) (0.72) (0.83) (0.98)

Net change in working capital 0.06 (0.64) (0.89) (0.54) 0.01 (0.98) (0.81) (0.86) (0.38) (0.04) Net operating cash flow 1.46 1.07 1.03 3.30 3.97 3.40 5.27 6.90 9.46 11.51 Investing Activities Purchase of PPE and intangibles (0.44) (1.14) (1.19) (0.73) (1.80) (1.78) (3.62) (5.20) (5.20) (2.02) Net change in financial investments (0.50) (0.20) (0.50) 1.20 0.01 - - - - - Other 0.00 0.06 0.09 0.06 0.00 - - - - - Net investing cash flow (0.94) (1.28) (1.60) 0.53 (1.79) (1.78) (3.62) (5.20) (5.20) (2.02) Financing Activities Net proceeds/redemtion of debt and leases (0.22) (0.19) (0.19) (0.16) (0.06) - 4.00 (0.80) (0.80) (0.80) Dividends paid (0.20) (0.34) (0.45) (0.56) (1.51) (1.89) (1.72) (2.46) (2.98) (3.70)

Cash Flow Statement (EURm) ...continued 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E

Change in capital 3.32 - - - - - - - - - Net other financing items 0.09 0.08 0.11 0.21 0.34 0.00 0.06 0.11 0.08 0.06 Net financing cash flow 2.99 (0.45) (0.53) (0.51) (1.22) (1.88) 2.34 (3.16) (3.70) (4.44)

Total change in cash 3.51 (0.66) (1.10) 3.32 0.95 (0.26) 3.99 (1.45) 0.56 5.05 Cash and cash equivalents at beginning of the year 0.58 4.09 3.43 2.33 5.65 6.60 6.34 10.32 8.87 9.43 Cash and cash equivalents at end of the year 4.09 3.43 2.33 5.65 6.60 6.34 10.32 8.87 9.43 14.48 Source: MADARA for historicals, LHV for estimates

Main Ratios 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E Growth, % Sales growth 26.3 28.7 21.2 39.2 20.5 15.0 21.2 14.1 10.5 7.7 Gross profit growth 40.1 30.1 17.1 53.3 20.3 12.6 26.7 15.7 13.7 10.7 EBITDA growth 33.5 12.9 9.4 95.4 10.2 3.1 36.6 29.7 25.3 17.0 Operating profit growth 44.6 9.1 0.1 139.5 13.9 (2.9) 38.6 23.5 23.0 19.8 Net profit growth 55.2 21.7 3.1 120.4 6.5 (6.3) 43.4 21.1 24.0 20.0 Margins and profitability, % Gross margin 62.9 63.5 61.4 67.5 67.4 66.0 69.0 70.0 72.0 74.0 EBITDA margin 23.9 20.9 18.9 26.5 24.3 21.8 24.5 27.9 31.6 34.3 Operating margin 18.3 15.5 12.8 22.0 20.8 17.5 20.1 21.7 24.2 26.9 Net margin 16.8 15.9 13.5 21.4 18.9 15.4 18.3 19.4 21.7 24.2 Return Ratios Capital Employed (EUR m) 7.9 8.9 9.8 12.5 14.6 16.2 23.4 26.1 29.7 34.1 ROCE (%) 23.8 17.6 15.8 31.7 29.7 25.4 27.4 27.1 29.5 30.9 ROE (%) 24.6 19.3 17.4 31.4 27.2 22.4 27.8 28.3 29.5 29.7 ROA (%) 18.3 16.0 15.0 27.3 23.7 19.5 22.2 21.7 24.0 25.4 Leverage Debt, EURm 0.62 0.44 0.25 0.09 0.03 0.03 4.03 3.23 2.43 1.63 Debt/Equity ratio, x 0.1 0.1 0.0 0.0 0.0 0.0 0.2 0.1 0.1 0.1 Net debt, EURm (3.97) (3.68) (3.03) (5.56) (6.57) (6.31) (6.29) (5.64) (7.0) (12.8) Net gearing, x (0.5) (0.4) (0.3) (0.4) (0.5) (0.4) (0.3) (0.2) (0.3) (0.4) Net debt/EBITDA, x (2.2) (1.8) (1.4) (1.3) (1.4) (1.3) (1.0) (0.7) (0.7) (1.0) Z-Score 11.4 15.2 14.6 28.7 32.9 26.6 11.2 11.9 12.8 14.3 Valuation Shares O/s (m) 3.75 3.75 3.75 3.77 3.77 3.77 3.77 3.77 3.77 3.77 Share Price (EUR) 7.50 7.95 7.85 19.80 27.75 24.00 24.00 24.00 24.00 24.00 Mkt. Cap (EURm) 28.1 29.8 29.4 74.6 104.6 90.5 90.5 90.5 90.5 90.5 Enterprise Value (EURm) 24.1 26.1 26.4 69.1 98.1 84.2 84.2 84.2 84.2 84.2 EV/Revenue, x 3.3 2.7 2.3 4.3 5.1 3.8 3.1 2.7 2.5 2.3 EV/EBITDA, x 13.6 13.1 12.1 16.2 20.9 17.4 12.7 9.8 7.8 6.7 P/E, x 22.5 19.6 18.8 21.7 28.5 26.3 18.4 15.2 12.2 10.2 P/BV, x 3.9 3.5 3.1 6.0 7.2 5.6 4.7 4.0 3.3 2.8 Dividend Yield (%) 0.7 1.1 1.5 0.8 1.4 2.1 1.9 2.7 3.3 4.1 Source: MADARA for historicals, LHV for estimates

Key Definitions/Formulas ROE Net profit divided by average equity book value ROCE EBIT divided by average capital employed ROA Net profit divided by average total assets EPS Net profit attributable to shareholders divided by weighted average number of shares BVPS Equity book value divided by year end number of shares Net debt Total financial debt less cash and cash equivalents P/E Corresponding share price divided by earnings per share P/BVPS Corresponding share price divided by book value per share EV/Sales* Enterprise value divided by sales EV/EBITDA* Enterprise value divided by EBITDA EV/EBIT* Enterprise value divided by EBIT Net gearing Net financial debt divided by total equity Debt/Equity Total financial debt divided by total equity Enterprise value Market Capitalisation plus total debt plus minority interest plus preferred equity at market value plus unfunded pension liabilities and other debt-deemed provisions minus value of associate companies minus cash and cash equivalents. Market Capitalisation Number of outstanding shares at the end of the period multiplied by share price. Altman Z-Score 1.2 multiplied by (working capital divided by total assets) plus 1.4 multiplied by (retained earnings divided by total assets) plus 3.3 multiplied by (earnings before interest and tax divided by total assets) plus 0.6multiplied by (market value of equity divided by total liabilities) plus 1.0 multiplied by (sales divided by total assets)

Source: LHV * To calculate EV for forward multiples we used the market capitalisation as of 9th June 2022 while used the latest reported data (31st Dec 2021) for net debt, investment in associates, and minority interest.

Contacts: Contacts: Ivars Bergmanis Ivars Bergmanis Head of Institutional Markets Head of Institutional Markets Tel: +372 680 2720 Tel: +372 680 2720 Mob: +372 534 11114 Mob: +372 534 11114 ivars.bergmanis@lhv.ee ivars.bergmanis@lhv.ee Sander Danil Valters Smiltāns Senior Analyst Analyst Tel: +372 680 2793 valters.smiltans@lhv.ee sander.danil@lhv.ee

All images are sourced from www.madaracosmetics.com Date and time of sign-off: Friday 10th June 2022, 18:00

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