Interim Report at March 31, 2019 - Maire Tecnimont...Interim Report at March 31, 2019 Maire Tecnimont Group 2 Contents 1. Financial Statements 3 Consolidated Income Statement 3 Consolidated

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Interim Report at March 31, 2019

Maire Tecnimont Group

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Contents

1. Financial Statements 3

Consolidated Income Statement 3

Consolidated Balance Sheet 4

Consolidated Statement of changes in Shareholders’ Equity 6

Consolidated Statement of Cash Flow (indirect method) 7

2. Key Events 8

3. Group operating performance 11

4. Performance by Business Unit 12

5. Backlog by Business Unit and Region 17

6. Group balance sheet and financial position 20

7. Human Resources 23

8. Subsequent events and outlook 23

9. Statement of the Executive Officer for Financial Reporting in accordance with Article 154-bis, paragraph 2 of the CFA 27

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1. Financial Statements

Consolidated Income Statement

(in Euro thousands)

Q1 2019 Q1 2018 CGE. %

Revenues 872,135 900,628

Other operating revenues 16,380 15,448

Total Revenues 888,515 916,076 -3.0%

Raw materials and consumables (262,179) (273,739)

Service costs (430,032) (473,518)

Personnel expenses (110,505) (94,374)

Other operating expenses (28,560) (23,962)

Total Costs (831,275) (865,593) -4.0%

EBITDA 57,240 50,483 13.4%

Amortization, depreciation and write-downs (10,394) (1,764)

Write-down of current assets (936) 0

Provisions for risks and charges 0 (0)

EBIT 45,910 48,718 -5.8%

Financial income 7,125 5,190

Financial expenses (8,151) (9,248)

Investment income/(expense) 1,242 698

Income before tax 46,125 45,358 1.7%

Income taxes, current and deferred (14,370) (14,559)

Net income for the period 31,755 30,799 3.1%

Group 30,844 28,506 8.2%

Minorities 911 2,294

Basic earnings per share 0.094 0.087

Diluted earnings per share 0.094 0.087


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Consolidated Balance Sheet

(in Euro thousands)

March 31, 2019 December 31,

2018

Assets

Non-current assets

Property, plant and equipment 42,361 33,700

Goodwill 294,202 291,754

Other intangible assets 65,442 64,232

Usage Right - Leasing 150,361 0

Investments in associates 16,725 20,449

Financial instruments - Derivatives 8,572 1,084

Other non-current financial assets 34,445 27,792

Other non-current assets 96,134 85,432

Deferred tax assets 41,452 44,801

Total non-current assets 749,695 569,243

Current assets

Inventories 9,694 6,968

Advance payments to suppliers 521,024 338,146

Contractual Assets 1,795,751 1,515,979

Trade receivables 403,249 425,768

Current tax assets 91,518 94,901


Other current financial assets 7,514 6,351

Other current assets 124,286 135,548

Cash and cash equivalents 558,474 650,008

Total current assets 3,529,714 3,180,740

Non-current assets classified as held-for-sale 0 0

Elimination of assets to and from assets/liabilities held-for-sale 0 0

Total Assets 4,279,409 3,749,983

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(in Euro thousands)

March 31, 2019 December 31,

2018

Shareholders’ Equity

Share capital 19,921 19,921

Share premium reserve 272,921 272,921

Other reserves 12,728 2,808

Valuation reserve 2,501 (15,553)

Total shareholders’ equity & reserves 308,071 280,097

Retained earnings/(accumulated losses) 30,002 (81,060)

Net income for the period 30,844 110,575

Total Group Shareholder’ Equity 368,917 309,612

Minorities 34,306 33,021

Total Shareholders’ Equity 403,223 342,633

Non-current liabilities

Financial debt - non-current portion 222,351 206,410

Provisions for charges - beyond 12 months 18,132 16,436

Deferred tax liabilities 23,943 21,623

Post-employment & other employee benefits 10,921 11,005

Other non-current liabilities 133,888 135,490


Other non-current financial liabilities 202,728 202,634

Non-current financial liabilities - Leasing 135,868 0

Total non-current liabilities 749,793 599,736

Current liabilities

Short-term debt 227,670 195,911

Current financial liabilities - Leasing 21,881 0

Provisions for charges - within 12 months 33,838 40,707

Tax payables 44,799 26,998


Other current financial liabilities 330 330

Client advance payments 768,964 637,837

Contractual Liabilities 341,173 335,598

Trade payables 1,598,363 1,478,301

Other Current Liabilities 72,438 66,439

Total current liabilities 3,126,392 2,807,614

Liabilities directly associated with non-current assets classified as held-for-sale

0 0

Elimination of liabilities to and from assets/liabilities held-for-sale 0 0

Total Shareholders’ Equity and Liabilities 4,279,409 3,749,983


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Consolidated Statement of changes in Shareholders’ Equity

(in Euro thousands)

Share capital

Share premium reserve

Other reserves

Translation reserve

Valuation reserve

Retained earnings/accum.

losses

Income/(losses) for the year

Group Shareholders’

equity

Minority interest capital

& reserves

Group & Minority

int. consol. share. equity

December 31, 2018 19,921 272,921 30,694 (27,887) (15,553) (81,060) 110,575 309,611 33,021 342,633

Allocation of the result

110,575

(110,575) - -

Change to consolidation scope

- -

Dividends distribution

- - -

Other movements

487 487 373

860

IFRS 2 (Employee share plans)

407

-

407

407

Comprehensive income/(loss)

9,513

18,054

30,844 58,411 911

59,322

March 31, 2019 19,921 272,921 31,101 (18,373) 2,501 30,002 30,844 368,917 34,306 403,223

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Consolidated Statement of Cash Flow (indirect method)

Cash and cash equivalents at beginning of the year (A) 650,008 630,868

Operations

Net Income of Group and Minorities 31,755 30,799

Adjustments:

- Amortisation of intangible assets 3,578 1,015

- Depreciation of non-current tangible assets 925 750

- Amortisation of Usage Right - Leasing 5,890 -

- Provisions 936 0

- (Revaluations)/Write-downs of investments (1,242) (698)

- Financial charges 8,151 4,058

- Financial income (7,124) -

- Income & deferred tax 14,370 14,559

- Capital (Gains)/Losses 1 1

- (Increase)/Decrease inventories/supplier advances (184,517) (51,734)

- (Increase)/Decrease in trade receivables 24,634 (30,140)

- (Increase)/Decrease in contract assets receivables (279,102) (211,366)

- Increase/(Decrease) in other liabilities 4,173 9,305

- (Increase)/Decrease in other assets 233 (19,827)

- Increase / (Decrease) in trade payables/advances from clients 265,801 235,766

- Increase / (Decrease) in contract liabilities 5,575 (37,225)

- Increase/(Decrease) in provisions (incl. post-employ. benefits) (4,922) 9,371

-Income taxes paid (3,272) (2,958)

Cash flow from operations (B) (114,155) (48,325)

Investments

(Investment)/Disposal of non-current tangible assets (1,558) (447)

(Investment)/Disposal of intangible assets (1,811) (2,455)

(Investment)/Disposal of associated companies 2,031 698

(Increase)/Decrease in other investments (338) (0)

(Investments)/(Divestments) in companies net of cash and cash equivalents acquired (11,733) -

Cash flow from investments (C) (13,408) (2,205)

Financing

Repayments of financial Leasing liabilities (7,057) -

Increase/(Decrease) in short-term debt 31,600 31,940

Repayments of long-term debt (1,492) (15,091)

Proceeds from long-term debt 17,432 -

Increase securities/bonds - (100)

Change in other financial assets/liabilities (4,453) 7,279

Treasury Shares - (22,796)

Cash flow from financing (D) 36,029 1,232

Increase/(Decrease) in cash and cash equivalents (B+C+D) (91,534) (49,299)

Cash and cash equivalents at end of period (A+B+C+D) 558,474 581,569

of which: Cash and cash equivalents of Discontinued Operations - -

CASH AND CASH EQ. AT END OF PERIOD REPORTED IN FIN. STATEMENTS 558,474 581,569

( in E uro thousands)

March 31, 2019March 31,

2018


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2. Key Events

The Group’s key operating events in Q1 2019 were as follows:

MAIRE TECNIMONT JOINS THE PLASTICS MECHANICAL RECYCLING SEGMENT THROUGH NEXTCHEM - A STEP FORWARD FOR THE GROUP’S GREEN ACCELERATION

On February 20, 2019, with regards to the Green Acceleration announced in November last, Maire Tecnimont through the subsidiary NextChem joined the Circular Economy sector, investing in the development of its first advanced plastics mechanical recycling plant. The circular economy is one of the three pillars of Nextchem’s strategy, together with “Greening the Brown” (offsetting environmental impacts from the conversion of petrol and gas) and “Green- Green” (developing additives and substitutes to oil for fuels or plastics from renewables).

The plant, located in Bedizzole, in the province of Brescia, will be managed by a new company, MyReplast Industries, a NextChem subsidiary and with a minority holding undertaken by local businesses; the total value of the operation is approx. Euro 12.5 million. The operation is funded by a non-recourse loan of Euro 8 million from Intesa Sanpaolo for the acquisition, in addition to a working capital line to support requirements for Euro 2 million, all through the new dedicated Circular Economy fund designed for structured support for such industrial initiatives. The plant, based on an economically-sustainable business model and without relying on any type of public incentives, has the following features:

• Major production capacity: the plant is currently among the largest in Europe and when fully operational capable of producing approx. 40 thousand tons per year of recycled polymers;

• High level of flexibility: the complex can treat various types of incoming plastic waste, both industrial production residues (e.g. vehicle components, food and industrial packaging production waste) and from post-consumption, i.e. materials from the sorting of household waste;

• Excellent finished product quality: the recycled polymers are of high quality, with recycling efficiency of approx. 95%. The currently operational complexes produce a material utilizable only for certain types of products due to their particular chemical-physical properties. The MyReplast Industries plant manufactures however a top-quality product, which permits extensive reuse for high added value products.

In the Circular Economy, mechanical recycling offers high levels of energy efficiency and significant flexibility in the treatment of various types of plastic waste. NextChem seeks to combine them with its developed know-how to regenerate recycled polymers, improving the technical properties. The outgoing recycled polymer from the MyReplast plant shall in fact have properties approaching those on the high added value “premium” markets, closing the quality gap between recycled plastic and virgin plastic (i.e. directly from fossil fuel hydrocarbons).

With this operation, NextChem will in addition have an industrial scale plant available to facilitate client’s needs in relation to major international market opportunities. The European Union, in particular, has set among its objectives an increase from the current 5% to 17% by 2025 of the share of recycled plastic out of the total produced on the continent. To achieve this increase - of approx. 12 million tons - within just six years will require 175 new recycling and sorting plant, with a capacity of 50 thousand tons each. In addition, from a regional viewpoint, market opportunities are greatest in areas close to production and material collection centers which support the plant. The recycled plastic production sector lends itself to the project development model, both in terms of the limited size of the investment compared to traditional plastic production plant and also the specific technological content. Consequently, Maire Tecnimont combines a traditional contractor approach with a new business model as a developer, co-developer and plant operator.

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NEW REIMBURSABLE FEED CONTRACT OF APPROX. USD 45 MILLION SIGNED FOR THE FOURTH EXPANSION OF THE RUWAIS PETROCHEMICAL COMPLEX IN ABU DHABI

On February 26, 2019 - Maire Tecnimont S.p.A. announced that its subsidiary Tecnimont S.p.A. had signed a contract with Abu Dhabi Polymers Company (Borouge) for Front-End Engineering and Design (FEED) on the fourth expansion phase of the Ruwais petrochemical complex, in Abu Dhabi (United Arab Emirates).

Borouge is a joint venture between Abu Dhabi National Oil Company (ADNOC), one of the largest oil & gas companies in the world, and Borealis, an Austrian global leader in supplying innovative polyethylene, chemical product and fertilizer solutions.

The total FEED contract value is approx. USD 45 million on a reimbursable basis.

The scope of works involves FEED activities for the fourth expansion phase of Borouge’s petrochemical complex in Ruwais, comprised of the largest mixed feed cracker in the world, with a capacity of 1.8 million tons of ethylene per year. The new cracker, Borouge’s fourth petrochemical complex, will be associated with numerous process units and the relative utilities & offsites. The project is scheduled for completion in 2020.

MAIRE TECNIMONT AWARDED REIMBURSABLE EPC CONTRACT WORTH APPROX. USD 65 MILLION BY NATPET IN THE REVAMPING BUSINESS

On February 28, 2019, Maire Tecnimont S.p.A. announced that its subsidiary Tecnimont S.p.A., through the branch Tecnimont Arabia Company Limited, was awarded a reimbursable EPC contract by National Petrochemical Industrial Company (NATPET), for the recovery of the polypropylene plant located in Yanbu Industrial City on the west coast of Saudi Arabia.

The total value of the contract is approx. USD 65 million on a reimbursable basis. The scope of works includes Engineering and Procurement services, material supply, Construction supervision services and construction operations. The project stipulates an estimated execution period of approx. seven months, until the Ready for Start Up.

MAIRE TECNIMONT AWARDED EPC SERVICES CONTRACT FOR ONE OF THE WORLD’S LARGEST PROPANE DEHYDROGENATION PLANT FOR BOREALIS IN BELGIUM

On March 7, 2019 - Maire Tecnimont S.p.A. announced the awarding to its subsidiary Tecnimont S.p.A. of an Engineering, Procurement, Construction Management (EPCM) and Commissioning contract for a new propane dehydrogenation plant (PDH), including the relative Utilities and Interconnections, from Borealis, a leading group in the supply of innovative polyolefin, chemical product and fertilizer solutions. The new complex, which will be located at the existing Borealis production site in Kallo (Belgium), will have a fully operational production capacity of 750,000 tons per year, making it one of the largest and most efficient plants in the world. The total value of the contract is approx. USD 90 million on a reimbursable basis.

PDH is a key process phase for the production of propylene from propane. Propylene is one of the key elements for the entire chemicals industry and is the raw material utilized to produce polypropylene (PP), which in turn is one of the most utilized plastics. It forms the base of a vast number of industrial applications, used in a broad range of sectors, including the automotive industry, textiles, food packaging, healthcare and energy, among many others.

The new PDH plant in Kallo shall be constructed at the existing Borealis production facility, selected in view of its excellent logistics positioning, in addition to its proven experience in the production of propylene, although also with the objective of tapping into the synergies available with the existing PDH unit. The new plant will employ the Oleflex™ technology of Honeywell UOP, a reliable and sustainable choice and widely utilized for the specific production of propylene. The new plant is expected to Start Up in the middle of 2022.


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TECHNOLOGY-DRIVEN CORE BUSINESS ORDERS FOR A TOTAL VALUE OF APPROX. USD 360 MILLION

On March 12, 2019 - Maire Tecnimont S.p.A. announced the awarding, through its main subsidiaries, of orders worth a total of approx. USD 360 million for licensing, engineering services and EP operations (Engineering and Procurement).

The contracts - awarded by some of the leading international clients - were won principally in Europe, North America and Asia.

In particular, the Group subsidiary with headquarters in Mumbai, Tecnimont Private Limited, was awarded two electro-instrumental works engineering services contracts for a refinery project in the United Arab Emirates, while KT- Kinetics Technology was awarded an Engineering and Procurement contract to construct a number of refinery process units in Egypt. In addition, with regards to the EPC project for the urea plant in Volgafert, announced on December 17, 2018, Maire Tecnimont announces that the project has now been included in the Order Intake and Backlog, in view of the completion of its financial close.

MAIRE TECNIMONT ENTERS NIGERIAN MARKET WITH CONTRACT OF APPROX. USD 50 MILLION AWARDED BY NNPC IN THE REFINERY BUSINESS

On March 22, 2019, Maire Tecnimont S.p.A. announced that its subsidiaries Tecnimont S.p.A. and Tecnimont Nigeria Limited had been awarded a “Phase 1 Rehabilitation Project” contract by the client Nigerian National Petroleum Company (NNPC) to carry out a complete integrity check and equipment inspection on the Port Harcourt Refinery complex owned by Port Harcourt Refinery Company Limited (PHRC), a subsidiary of NNPC.

The “Phase 1 Rehabilitation” contract has a value of approx. USD 50 million and consists of a six-month assessment and the relative engineering and design for the Port Harcourt Refinery complex in Port Harcourt, in Rivers State (Nigeria). The complex comprises two refinery plant with an overall capacity of approx. 210,000 bpd (barrels per day). Execution of the integrity check and of the equipment inspection is preparatory to a second phase, the “Phase 2 Rehabilitation Project”, which consists of complete rehabilitation of the complex in order to recover production capacity to at least 90%. The second phase, subject to completion of the integrity check, shall be carried out on an EPC basis by Tecnimont and Tecnimont Nigeria, in collaboration with a partner.

The two-phase revamping projects is strategic for the development of the hydrocarbon downstream sector in Nigeria, boosting internal production and improving processes, while guaranteeing top-quality and high-added value products.

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3. Group operating performance

The Maire Tecnimont Group Q1 2019 key financial highlights with application of IFRS 16 (compared to the same period of the previous year) are reported below:

(in Euro thousands) Q1 2019 % Q1 2018 % Change

Performance indicators:

Revenues 888,515 916,076 (27,561) (3.0%)

Business Profit (*) 77,329 8.7% 69,963 7.6% 7,366 10.5%

EBITDA (**) 57,240 6.4% 50,483 5.5% 6,757 13.4%

EBIT 45,910 5.2% 48,718 5.3% (2,808) (5.8%)

Net financial expense 216 0.0% (3,360) (0.4%) 3,576 106.4%

Income before tax 46,125 5.2% 45,358 5.0% 767 1.7%

Income taxes (14,370) (1.6%) (14,559) (1.6%) (189) (1.3%)

Tax rate (31.2%) (32.1%) N/A

Net income 31,755 3.6% 30,799 3.4% 956 3.1%

Group net income 30,844 3.5% 28,506 3.1% 2,338 8.2%

(1) “Business Profit” is the industrial margin before the allocation of general and administrative costs and research and

development expenses; its percentage of revenues is the Business Margin.

(**) EBITDA is net income for the year before taxes (current and deferred), net financial expenses, currency exchange differences, gains and losses on the valuation of holdings, amortization and depreciation and provisions. EBITDA is a measure utilized by management to monitor and assess the operating performance. Management consider EBITDA a key parameter in measuring the Group’s performance as not impacted by the effects of differing criteria applied to taxable income, the amount and characteristics of the capital utilized and by amortization and depreciation. As EBITDA is not governed by the Group’s accounting standards, the Group calculation criteria may not be uniform with those adopted by other groups and, therefore, may not be comparable.

The Q1 2019 pro-forma key financial highlights without application of IFRS 16 (compared to Q1 2018) are reported below:

(in Euro thousands)

Q1 2019 (*) % Q1 2018 % Change

Adjusted Performance Indicators:

Revenues 888,515 916,076 (27,561) (3.0%)

Business Profit (1) 70,272 7.9% 69,963 7.6% 309 0.4%

EBITDA (1) 50,183 5.6% 50,483 5.5% (300) (0.6%)

EBIT (2) 44,743 5.0% 48,718 5.3% (3,975) (8.2%)

Net financial expense (3) 1,783 0.2% (3,360) (0.4%) 5,143 153.1%

Income before tax 46,526 5.2% 45,358 5.0% 1,168 2.6%

Income taxes (14,427) (1.6%) (14,559) (1.6%) (132) (0.9%)

Tax rate (31.0%) (32.1%) N/A

Net income for the period (4) 32,099 3.6% 30,799 3.4% 1,300 4.2%

Group net income (4) 31,188 3.5% 28,506 3.1% 2,682 9.4%

* For comparison with Q1 2018, the 2019 data was adjusted, excluding the effects of IFRS 16 as follows:

(1) Recognition of leasing charges of Euro 7 million at Business Profit and EBITDA level; (2) Reversal of amortization and depreciation of Euro 6 million with positive effect at EBIT level; (3) Reversal of financial charges on finance lease liabilities of Euro 1.6 million; (4) Net positive effect, after taxes, of adjustments (1), (2) and (3) above for Euro 0.3 million.


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The Maire Tecnimont Group in Q1 2019 reported production volumes of Euro 888.5 million, up 3% on Q1 2018 (Euro 916.1 million).

Revenues reflect the development of portfolio projects and the uneven performance over time, depending upon the scheduling of the individual works and on climatic factors affecting a number of major projects. Over the coming quarters, production volumes are expected to grow, in line with project planning.

The Group reports a Business Profit of Euro 70.3 million for Q1 2019, increasing 0.4% on Euro 69.9 million for Q1 2018. The Q1 2019 adjusted consolidated Business Margin was 7.9%, up on Q1 2018 (7.6%), although substantially in line with 2018.

G&A costs were Euro 18.6 million, accounting for 2.1% of consolidated revenues - substantially in line with 2018.

The Group, taking account also of R&D costs of approx. Euro 1.5 million in Q1 2019, reports adjusted EBITDA of Euro 50.2 million, slightly contracting 0.6% on the EBITDA for the previous year (Euro 50.5 million) - essentially due to lower volumes in the quarter. The margin is however 5.6%, therefore slightly increasing on Q1 2018 (5.5%). Amortization, depreciation, write-downs and provisions amounted to Euro 5.4 million, increasing on the same period of the previous year (Euro 1.8 million), mainly following the initiation of amortization and depreciation of new Group operating assets. The Group reported for Q1 2019 an adjusted EBIT of Euro 44.7 million, -8.2% over the same period in the previous year (Euro 48.7 million).

Adjusted net financial income amounted to Euro 1.8 million, compared to net expenses of Euro 3.4 million in 2018; the Q1 2019 figure principally stems from the contribution from the net valuation of a number of derivative instruments for Euro 3.9 million, which had negatively impacted the same period of the previous year for Euro 0.6 million. The financial management result was substantially in line with the comparative period.

Adjusted pre-tax income totaled Euro 46.5 million (up 2.6%), against estimated taxes of Euro 14.4 million.

The effective tax rate was approx. 31%, reducing on the adjusted average tax rate reported for the preceding quarters and on the previous year (32.1%), based on the various countries in which operations are carried out.

The Q1 2019 adjusted net income was Euro 32.1 million, compared to Euro 30.8 million in 2018, up 4.2%.

Adjusted group net income amounted to Euro 31.2 million, increasing 9.4% on the previous year (Euro 28.5 million).

In Q1 2019, the Maire Tecnimont Group won new projects and existing contract extensions worth approx. Euro 597.9 million. The Backlog at March 31, 2019 is Euro 6,657.2 million, slightly increasing (approx. Euro 45.2 million) over December 31, 2018, partly due to the appreciation of currencies in which contractual fees are denominated.

4. Performance by Business Unit

INTRODUCTION

Maire Tecnimont S.p.A. heads an integrated industrial group providing engineering services and works in the following sectors on the domestic and international markets: Hydrocarbons and Green Energy.

The BU figures are in line with the new internal reporting structure utilized by company Top Management and in particular with the reporting used by the highest decision-making level for the taking of business

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decisions, identified as the chief executive officer (CODM). The features of these sectors are outlined below:

I. ‘Hydrocarbons’ Business Unit - designs and constructs plant, principally for the “natural gas chain” (involving separation, treatment, liquefaction, transport, storage, regasification and compression and pumping stations); designs and constructs chemical and petrochemical industry plant for the production, in particular, of polyethylene and polypropylene (polyolefin), ethylene oxide, ethylene glycol, purified terephthalic acid ("PTA"), ammonia, urea and fertilizers; issues, in addition, within the fertilizer sector, licenses on patented technology and proprietary know-how to current and potential urea producers. Other major activities related to the sulphur recovery process, hydrogen production and high temperature furnaces. It is also engaged in the design and construction of hydro-carbon electric power plant and waste-to-energy and district heating plant.

II. ‘Green Energy’ Business Unit , involved in Green Acceleration initiatives managed by NextChem and its subsidiaries, focused on the circular economy, undertaking mechanical plastics recycling and the promotion of recycled chemicals; together with “Greening the Brown” (offsetting environmental impacts from the conversion of petrol and gas) and “Green- Green” (developing additives and substitutes to oil for fuels or plastics from renewables), of which NextChem has proprietary technologies or agreements for the exclusive use of third party technologies. It also works on large-scale renewables sector plant (mainly solar and wind). The Group provides maintenance and facility management services, in addition to general services for temporary construction facilities and the design and construction of infrastructure.

The Group assesses the performance of the operating segments based on the segment operating result. Segment revenues are those directly deriving from or attributable to the Segment and from core operations and include revenues from agreements with third parties. Segment costs are charges from segment operations incurred from third parties. For Group operations, amortization, depreciation, provisions for risks, financial income and expense and income taxes are borne by the corporate entity as excluded from operating activities.

The Maire Tecnimont Group Q1 2019 key financial highlights by Business Unit (compared to Q1 2018) are reported below:

(in Euro thousands)

Hydrocarbons Green Energy Total

Total % on

Revenues Total

% on Revenues

Total % on

Revenues Q1 2019 Revenues 856,023 32,492 888,515

Business Margin 74,661 8.7% 2,668 8.2% 77,329 8.7%

EBITDA 56,159 6.6% 1,082 3.3% 57,240 6.4%

Q1 2018

Revenues 870,954 45,121 916,076

Business Margin 66,904 7.7% 3,059 6.8% 69,963 7.6%

EBITDA 49,001 5.6% 1,482 3.3% 50,483 5.5%

Change Q1 2019 vs Q1 2018

Revenues (14,931) (0) (12,629) (0) (27,561) (3.0%)

Business Margin 7,758 11.6% (392) (12.8%) 7,366 10.5%

EBITDA 7,157 14.6% (400) (27.0%) 6,757 13.4%


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The Q1 2019 pro-forma key financial highlights by Business Unit without application of IFRS 16 (compared to Q1 2018) are reported below:

(in Euro millions)

Q1 2019 (*) %

Revenues Q1 2018

% Revenues

Change

Hydrocarbons

Revenues 856.0 871.0 -14.9 -1.7%

Business Profit 67.7 7.9% 66.9 7.7% 0.8 1.2%

EBITDA 49.2 5.8% 49.0 5.6% 0.2 0.5%

Green Energy

Revenues 32.5 45.1 -12.6 -28.0%

Business Profit 2.5 7.8% 3.1 6.8% -0.5 -17.3%

EBITDA 1.0 2.9% 1.5 3.3% -0.5 -36.2%

(*) For comparison with Q1 2018, the 2019 data was adjusted, without applying IFRS 16 and making the following adjustments: a negative effect of Euro 7 million on Business Profit and EBITDA for the Hydrocarbons BU and a negative effect of Euro 0.1 million on Business Profit and EBITDA for the Green Energy BU;

HYDROCARBONS BUSINESS UNIT

Q1 2019 revenues amounted to Euro 856 million (Euro 871 million in Q1 2018), reducing 1.7% on the previous year.

Revenues reflect the development of portfolio projects and the uneven performance over time, depending upon the scheduling of the individual works and on climatic factors affecting a number of major projects. Over the coming quarters, production volumes are expected to grow, in line with project planning.

The Q1 2019 Adjusted Business Profit increased slightly to Euro 67.7 million (Euro 66.9 million for Q1 2018).

Q1 2019 Adjusted EBITDA was Euro 49.2 million (Euro 49 million in Q1 2018), with a margin of 5.8% and slightly increasing in absolute and percentage terms on the same period of the previous year, although substantially in line with the 2018 figure. This performance stems mainly from marginal levels on portfolio projects.

GREEN ENERGY BUSINESS UNIT

Q1 2019 revenues of Euro 32.5 million decreased 28% on the previous year (Q1 2018 revenues of Euro 45.1 million), as a result of the conclusion of orders in portfolio in the large renewables plant sector not yet replaced by new orders and the conclusion phase also of a project in the hospital sector. Operations of the subsidiary NextChem in the Circular Economy simultaneously sector started up, following the investment in the first advanced mechanical plastics recycling plant.

The Q1 2019 Business Profit was Euro 2.5 million (Euro 3.1 million in Q1 2018), essentially reducing on the basis of lower volumes. In addition, the Adjusted Business Margin for Q1 2019 was 7.8%, increasing on 6.8% in Q1 2018, thanks to the higher proportion of recently started operations.

Q1 2019 Adjusted EBITDA was Euro 1 million after the absorption of G&A costs, which reduced on the same period of the previous year.

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The following tables outline Revenues, Business Profit and EBITDA by Business Unit.


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VALUE OF PRODUCTION BY REGION:

The regional breakdown of Revenues in Q1 2019 compared to the previous year is illustrated below:

Total % Total % Total %

Italy 41,564 4.7% 88,141 9.6% (46,577) (52.8%)

Overseas

· Europe (EU) 25,937 2.9% 40,590 4.4% (14,652) (36.1%)

· Europe (non-EU) 419,843 47.3% 177,535 19.4% 242,308 136.5%

· Middle East 165,764 18.7% 352,980 38.5% (187,215) (53.0%)

· The Americas 27,930 3.1% 88,979 9.7% (61,050) (68.6%)

· Africa 26,093 2.9% 29,124 3.2% (3,031) (10.4%)

· Asia 181,384 20.4% 138,728 15.1% 42,657 30.7%

Total Consolidated Revenues 888,515 916,075 (27,560) (3.0%)

( in E uro thousands) Q1 2019 Q1 2018 Change

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The main regional revenue sources were Europe – non-EU (47.3%), which reflects the development of operations in Russia. As apparent in the revenues table, a reduction was reported in the Middle East.

5. Backlog by Business Unit and Region

The following tables outline the Group’s Backlog, broken down by Business Unit at March 31, 2019, net of third-party shares and compared to the previous year:

BACKLOG BY BUSINESS UNIT

(*) Initial Backlog following the introduction of the new Business Units from January 1, 2019, with reallocation of Euro 4.6 million from Hydrocarbons to Green Energy.

(**) Backlog revenues are net of third-party shares of Euro 1.1 million.

(***) 2019 Adjustment/Eliminations principally reflect portfolio currency adjustments.

( in Euro t housands)

HydrocarbonsGreen

EnergyTotal

Initial Order Backlog at 01/01/2019 (*) 6.364.836 247.132 6.611.968

Adjustments/Eliminations (***) 285.966 48.828 334.794

2019 Order Intake 587.255 10.618 597.873

Revenues net of third parties (**) 856.018 31.458 887.476

Backlog at 31/03/2019 6.382.039 275.119 6.657.158


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(*) Initial Backlog following the introduction of the new Business Units from January 1, 2019, with reallocation of Euro 4.6 million from Hydrocarbons to Green Energy.

In Q1 2019, the Maire Tecnimont Group won new projects and existing contract extensions worth approx. Euro 597.9 million. The Backlog at March 31, 2019 is Euro 6,657.2 million, slightly increasing (approx. Euro 45.2 million) over December 31, 2018, partly due to the appreciation of currencies in which contractual fees are denominated.

BACKLOG BY REGION

The Group Backlog broken down by region at March 31, 2019 and compared with the previous year is presented below:

(*) Backlog revenues are net of third-party shares totaling Euro 1.1 million. (**) 2019 Adjustment/Eliminations principally reflect portfolio currency adjustments.

Backlog at

31.12.2018


Backlog at

31.03.2019

Backlog at

31.03.2018

6,364,836 Hydrocarbons 6,382,039 7,160,820 (778,781) (10.9%) 17,203 0.3%

247,132 Green Energy 275,119 342,464 (67,345) (19.7%) 27,987 11.3%

6,611,968 Total 6,657,158 7,503,284 (846,126) (11.3%) 45,191 0.7%

Change March 2019 vs March

2018

Change March 2019 vs

December 2018

Europe (EU) Europe (non-EU) Middle EastThe

AmericasAfrica Asia Other

Initial Order Backlog at

01/01/2019141,973 107,326 3,543,392 692,379 159,147 758,106 1,209,645 0 6,611,968

Adjustments/Eliminations 42,348 12,645 161,346 76,163 5,560 (6,818) 43,845 (294) 334,794

2019 Order Intake 10,618 91,598 187,637 150,236 42,208 113,489 2,088 0 597,873

Revenues net of third parties 29,009 37,457 419,839 165,764 27,930 26,093 181,384 0 887,476

Backlog at 31/03/2019 165,929 174,112 3,472,536 753,013 178,985 838,685 1,074,193 (294) 6,657,158


Italy Total

Overseas

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ORDER INTAKE BY BUSINESS UNIT AND REGION

The table below outlines Q1 2019 Group Order Intake broken down by Business Unit and Region and compared with the previous year:

Backlog at

31.12.2018


Backlog at

31.03.2019

Backlog at

31.03.2018

% %

141,973 Italy 165,929 262,588 (96,659) (36.8%) 23,956 16.9%

107,326 Europe (EU) 174,112 111,698 62,414 55.9% 66,786 62.2%

3,543,392 Europe (non-EU) 3,472,536 4,084,262 (611,726) (15.0%) (70,856) (2.0%)

692,379 Middle East 753,013 1,046,001 (292,988) (28.0%) 60,634 8.8%

159,147 The Americas 178,985 89,448 89,537 100.1% 19,838 12.5%

758,106 Africa 838,685 638,151 200,534 31.4% 80,579 10.6%

1,209,645 Asia 1,074,193 1,271,137 (196,943) (15.5%) (135,452) (11.2%)

0 Others (294) 0 (294) 294 (294) 0.0%

6,611,968 Total 6,657,158 7,503,284 (846,126) (11.3%) 45,191 0.7%

Change March 2019 vs March

2018

Change March 2019 vs December

2018

% of total % of total

Order Intake by Business Unit

Hydrocarbons 587,255 98.2% 1,283,171 98.6% (695,916) (54.2%)

Green Energy 10,618 1.8% 18,726 1.4% (8,108) (43.3%)

Total 597,873 100% 1,301,897 100% (704,024) (54.1%)

Order Intake by Region:

Italy 10,618 1.8% 22,673 1.7% (12,055) (53.2%)

Europe (EU) 91,598 15.3% 76,036 5.8% 15,562 20.5%

Europe (non-EU) 187,637 31.4% 184,752 14.2% 2,885 1.6%

Middle East 150,236 25.1% 25,989 2.0% 124,247 478.1%

The Americas 42,208 7.1% 7,554 0.6% 34,654 458.8%

Africa 113,489 19.0% 78,987 6.1% 34,501 43.7%

Asia 2,088 0.3% 905,905 69.6% (903,818) (99.8%)

Total 597,873 100% 1,301,897 100% (704,024) (54.1%)

Q1 2019 Q1 2018 Change 2019 vs 2018( in E uro thousands)


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6. Group balance sheet and financial position

The Maire Tecnimont Group key balance sheet highlights at March 31, 2019 and December 31, 2018 were as follows:

Maire Tecnimont Condensed Consolidated Balance Sheet March 31, 2019 December 31, 2018 Change (in Euro thousands)

Non-current assets 749,695 569,243 180,452

Inventories/Advances to Suppliers 530,718 345,113 185,605

Contractual Assets 1,795,751 1,515,979 279,772

Trade receivables 403,249 425,768 (22,519)

Cash and cash equivalents 558,474 650,008 (91,534)

Other current assets 241,522 243,872 (2,350)

Current assets 3,529,714 3,180,740 348,974

Assets held for sale, net of eliminations 0 0 0

Total assets 4,279,409 3,749,983 529,426

Group shareholders’ equity 368,917 309,612 59,305

Minorities Shareholders' Equity 34,306 33,021 1,285

Financial debt - non-current portion 222,351 206,410 15,940

Other non-current financial liabilities 202,728 202,634 94

Non-current financial liabilities - Leasing 135,868 0 135,868

Other non-current liabilities 188,847 190,692 (1,845)

Non-current liabilities 749,793 599,736 150,057

Short-term debt 227,670 195,911 31,759

Current financial liabilities - Leasing 21,881 0 21,881

Other financial liabilities 330 330 0

Client advance payments 768,964 637,837 131,127

Contractual Liabilities 341,173 335,598 5,575

Trade payables 1,598,363 1,478,301 120,061

Other current liabilities 168,011 159,637 8,375

Current liabilities 3,126,392 2,807,614 318,778

Liabilities held for sale, net of eliminations 0 0 0

Total Shareholders’ Equity and Liabilities 4,279,409 3,749,983 529,426

“Non-current assets” increased on the previous year, mainly due to the recognition for Euro 150,361 thousand of the “Usage rights” account arising following the application of the new standard IFRS 16; the additional increases relate to the assets of MyReplast Industries S.r.l, a NextChem subsidiary acquired on February 20, which manages an advanced mechanical plastics recycling plant located in Bedizzole (provide of Brescia). The total value of the operation is approx. Euro 12.5 million.

“Current assets” also increased on the previous year, by Euro 348,974 thousand, with the main changes concerning the working capital movements on the main orders, as per the contractual terms. The increase in the payments on account to suppliers is a direct consequence of the advancement of the projects acquired in previous years, particularly on the Amursky project and for which significant numbers of principal equipment and construction activity orders were made, with the consequent recognition of financial advances on supplies and the relative services. Cash and cash equivalents at March 31, 2019 amount to Euro 558,474 thousand, a decrease of Euro 91,534 thousand compared to December 31, 2018.

The main cash flow movements are reported below:

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Cash Flow Statement

March 31, 2019

March 31, 2018

Change (in Euro thousands)

Cash and cash equivalents at beginning of the period (A) 650,008 630,868 19,140

Cash flow from operating activities (B) (114,155) (48,325) (65,831)

Cash flow from investing activities (C) (13,408) (2,205) (11,204)

Cash flow absorbed from financing activities (D) 36,029 1,232 34,797

Increase/(Decrease) in cash and cash equivalents (B+C+D) (91,534) (49,299) (42,235)

Cash and cash equivalents at end of the period (A+B+C+D) 558,474 581,569 (23,095)

of which: Cash and cash equivalents of Discontinued Operations 0 0 0

Cash and cash equivalents at end of period reported in financial statements 558,474 581,569 (23,095)

Cash flows from operations absorbed Euro 114,155 thousand, mainly due to expected working capital changes in line with the normal development of projects, in particular the EPC projects close to completion, in addition to the nature of the recently acquired contracts.

Investment activities absorbed cash totaling Euro 13,408 thousand, mainly for the acquisition of MyReplast Industries S.r.l, a NextChem subsidiary which manages an advanced mechanical plastics recycling plant. The total value of the operation is approx. Euro 12.5 million.

Financing activities generated cash totaling Euro 36,029 thousand, mainly due to the utilization of current account overdrafts as part of the management of the working capital on a number of projects and the drawdown of a non-recourse loan of approx. Euro 8 million from Intesa Sanpaolo, through the new fund dedicated to the Circular Economy established for structured support for these type of industrial initiatives, for the acquisition of MyReplast Industries S.r.l, in addition to a working capital line to support requirements for Euro 2 million.

The Net Financial Position is outlined in the following table:

NET FINANCIAL POSITION March 31, 2019

December 31, 2018

Change (in Euro thousands)

Short-term debt 227,670 195,911 31,759

Current financial liabilities - Leasing 21,881 0 21,881

Other current financial liabilities 330 330 0

Financial instruments - Current derivatives 16,937 25,493 (8,555)

Financial debt - non-current portion 222,351 206,410 15,940

Financial instruments - Non-current derivatives 1,963 6,139 (4,175)

Other non-current financial liabilities 202,728 202,634 94

Non-current financial liabilities - Leasing 135,868 0 135,868

Total debt 829,728 636,916 192,812

Cash and cash equivalents (558,474) (650,008) 91,534


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NET FINANCIAL POSITION March 31,

2019 December 31, 2018

Change

Other current financial assets (7,514) (6,351) (1,162)

Financial instruments - Current derivatives (18,204) (7,071) (11,133)

Financial instruments - Non-current derivatives (8,572) (1,084) (7,488)

Other non-current financial assets (20,096) (13,761) (6,335)

Total cash and cash equivalents (612,860) (678,276) 65,416

Other financial liabilities of discontinued operations 0 0 0

Other financial assets of discontinued operations 0 0 0

Net financial position 216,868 (41,359) 258,228

“Non-recourse” financial payables (43,440) (36,270) (7,171)

Other non-current assets - Expected repayments (16,555) (16,245) (311)

Finance lease payables IFRS 16 (157,749) 0 (157,749)

Adjusted Net Financial Position (876) (93,874) 92,998

As the Net Financial Position is not governed by the Group’s accounting standards, the Group calculation criteria may not be uniform with those adopted by other groups and, therefore, may not be comparable.

The adjusted net financial position at March 31, 2019 was a Net Cash position of Euro 0.9 million, reducing on December 31, 2018. Cash and cash equivalents at March 31, 2019 amount to Euro 558,474 thousand, decreasing Euro 91,534 thousand over December 31, 2018, with the reduction - as already outlined - mainly due to working capital changes related to the normal execution of projects, in particular EPC projects close to completion, in addition to the nature of the recently acquired contracts.

Against the decrease in cash and cash equivalents, the gross debt rose following an increase in short-term debt due to the utilization of current account overdrafts as part of the working capital management on a number of projects and of long-term financial payables, principally concerning the drawdown of a non-recourse loan of approx. Euro 8 million issued by Intesa Sanpaolo for the acquisition of MyReplast Industries S.r.l.

The “Non-Recourse” financial payables account concerns the loan by the project company MGR Verduno S.p.A., engaged in the “Alba-Bra Hospital concession” construction and management contract agreed with ASL CN2 and the loan for the acquisition of MyReplast Industries S.r.l.. The above financial payables are on a no-recourse basis, i.e. a type of financing dedicated to these initiatives which is not guaranteed by the Parent Company, but rather by the cash flows from the development of these initiatives of the Vehicle Companies. For these reasons, they were excluded from the calculation of the adjusted net financial position.

Finance lease payables - IFRS 16 of Euro 157,749 thousand were recognized due to the application of the new standard IFRS 16.

Group Shareholders' equity at March 31, 2019 amounts to Euro 368,917 thousand, a net increase of Euro 59,305 thousand compared to December 31, 2018 (Euro 309,612 thousand). Total consolidated Shareholders’ Equity, considering minority interests, at March 31, 2019 amounts to Euro 403,223 thousand, an increase of Euro 60,590 thousand compared to December 31, 2018.

The overall increase in Group Shareholders’ Equity is mainly due to the net income for the period for Euro 31,755 thousand together with the positive change in the Cash Flow Hedge reserve of the derivative instruments, which mainly relates to the mark-to-market gains of the derivative instruments to hedge the currency risk of the revenues and costs from the projects, net of the relative tax effect and of the reserve for the translation of items in foreign currencies.

“Current liabilities” also increased on the previous year, by Euro 318,778 thousand, with the main changes concerning the working capital movements on the main orders, as per the contractual terms.

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7. Human Resources

The headcount of the Maire Tecnimont Group at March 31, 2019 was 6,275, compared to 6,140 at December 31, 2018, increasing 135, following 443 new hires and 308 departures in the period.

The workforce at 31/03/2019 of the Maire Tecnimont Group, with movements (by qualification and region) on 31/12/2018, is outlined in the following tables.

Changes in workforce by category (31/12/2018-31/03/2019):

Category Workforce 31/12/2018

Hires Departures Reclassification

employee category (*)

Workforce 31/03/2019

Cge. Workforce 31/03/2019

vs. 31/12/2018

Executives 639 5 (7) 0 637 (2)

Managers 2,132 92 (67) 7 2,164 32

White-collar 3,151 298 (220) (7) 3,222 71

Blue-collar 218 48 (14) 0 252 34

Total 6,140 443 (308) 0 6,275 135

Average headcount 5,846 6,217

(*) includes promotions, changes in category following inter-company transfers / Job Title reclassifications

The category “Executives” and “Managers” does not reflect the Italian contractual term, but refers to national and international Management and Middle Management identification parameters utilized for Italian and overseas managerial staff.

Changes in workforce by region (31/12/2018-31/03/2019):

Region Workforce

31/12/2018 Hires Departures

Reclassification employee

category (*)

Workforce 31/03/2019

Cge. Workforce 31/03/2019

vs. 31/12/2018

Italy & Rest of Europe 2,857 158 (94) (5) 2,916 59

India & Rest of Asia 2,064 92 (35) 6 2,127 63

Russia & Caspian Region 552 132 (74) (1) 609 57

Americas Region 27 1 (1) 0 27 0

Middle East Region 561 56 (98) 0 519 (42)

North Africa Region & Sub-Saharan Africa Region

79 4 (6) 0 77 (2)

Total 6,140 443 (308) 0 6,275 135

8. Subsequent events and outlook

The key events were as follows:

SHAREHOLDERS’ MEETING APPROVES FINANCIAL STATEMENTS AT DECEMBER 31, 2018, THE DISTRIBUTION OF A DIVIDEND AND THE APPOINTMENT OF NEW CORPORATE BOARDS FOR THE 2019-2021 THREE-YEAR PERIOD


24

On April 29, 2019, the Shareholders’ Meeting of Maire Tecnimont S.p.A. in ordinary session and in first call approved: i) the Financial Statements of the company at December 31, 2018 reporting Net Income of Euro 39,466,209.44 and ii) the distribution of a dividend for a total of Euro 39,108,211.41, equal to one-third of 2018 consolidated net income of Euro 117.4 million. The Shareholders’ Meeting also appointed the new Board of Directors of the company for the 2019-2021 three-year period, which will remain in office until the approval of the 2021 Annual Accounts, comprising: Luigi Alfieri, Gabriella Chersicla, Fabrizio Di Amato, Stefano Fiorini, Pierroberto Folgiero, Vittoria Giustiniani, Andrea Pellegrini and Patrizia Riva – from the slate presented by the majority shareholder GLV Capital S.p.A., holder of 167,665,134 shares of Maire Tecnimont, without nominal value, equal to 51.018% of the shares with voting rights, receiving 83.36% of votes – and Maurizia Squinzi – from the minority slate, jointly presented by a number of institutional investor shareholders indicated in the slate filed, holding a total 9,935,692 Maire Tecnimont shares, without nominal value, equal to 3.023% of shares with voting rights. The Shareholders’ Meeting also confirmed Mr. Fabrizio Di Amato as Chairman of the Board of Directors. The Shareholders’ Meeting appointed the new Board of Statutory Auditors for the 2019-2021 three-year period, which will remain in office until the approval of the 2021 Annual Accounts, comprising: Francesco Fallacara (Chairman), from the minority slate presented jointly by a number of institutional investor shareholders indicated in the slate filed, holding a total of 9,935,692 shares of Maire Tecnimont, without nominal value, equal to 3.023% of shares with voting rights, Giorgio Loli and Antonia Di Bella (Statutory Auditors), both from the slate presented by the majority shareholder GLV Capital S.p.A., holder of a total of 167,665,134 shares of Maire Tecnimont, without nominal value, equal to 51.018% of the shares with voting rights, which received 83.33% of the votes. The Alternate Auditors Massimiliano Leoni and Alessandra Conte were appointed from the majority slate, while the Alternate Auditor Andrea Lorenzatti was appointed from the minority slate. The Shareholders’ Meeting also voted in favor of the First Section of the 2019 Remuneration Report drawn up in accordance with Article 123-ter of the CFA. The Shareholders’ Meeting also authorized the Board of Directors to purchase and dispose of treasury shares as per Articles 2357 and 2357-ter of the Civil Code, Article 132 of Legislative Decree No. 58 of February 24, 1998 (“CFA”) and Article 144-bis of Consob Issuers’ Regulation 11971/1999, as subsequently amended, according to the means proposed by the Board of Directors on March 14, 2019. Authorization was granted to acquire treasury shares up to a maximum 2,000,000 ordinary shares, 0.6% of the shares currently in circulation. The authorization to purchase and dispose of treasury shares was approved in order to permit the company to acquire and dispose of ordinary shares, in compliance with the applicable European and domestic regulations, for all purposes permitted by the applicable provisions, including those set out by Article 5 of Regulation EC 596/2014 (“MAR”) and the practices permitted by Consob in accordance with Article 13 MAR, according to the terms and the means which may be approved by the competent corporate boards, in addition to, where required, the utilization of treasury shares in service of the third cycle (2018) of the “2016-2018 Maire Tecnimont Group Employee Share Ownership Plan” approved by the Ordinary Shareholders’ Meeting of April 27, 2016 as per Article 114-bis of the CFA. The authorization for purchases approved is 18 months, while authorization for disposals is without time limit. The unitary payment for the purchase of shares shall be established for each transaction, subject to the restriction that share purchase payments may not exceed the higher price between the price of the last independent transaction and the highest present independent purchase bid price during the trading session in which the purchase was made, while the above-stated unitary price may not however be 10% higher or lower than the share price recorded in the trading session before each individual purchase transaction. The Shareholders’ Meeting finally approved, on the reasoned proposal of the Board of Statutory Auditors, the amendment to the financial terms of the legal audit appointment assigned, in accordance with Legislative Decree 39/2010, to the company PricewaterhouseCoopers S.p.A. for the 2016-2024 period, with regards to financial years 2018 to 2024 inclusive.

MAIRE TECNIMONT BOARD OF DIRECTORS’ MOTIONS On April 29, 2019, the Board of Directors of Maire Tecnimont S.p.A., noted the confirmation of Fabrizio Di Amato as Chairman of the Board of Directors by the Shareholders’ Meeting, confirming his appointment and the allocation of powers in accordance with statutory law and the By-Laws, including in particular,

25

the undertaking of institutional relations and external relations and the oversight of implementation of the strategic plans approved by the Board of Directors. The Board of Directors also confirmed Pierroberto Folgiero as Executive Director and General Manager, granting him as CEO (the most senior operating manager) executive functions for the management and co-ordination of Group operations. Pierroberto Folgiero was also confirmed as Director in charge of the internal control and risk management system. The Board of Directors also assessed and confirmed, on the basis of available information and the declarations of the interested parties, the independence in accordance with law and the Self-Governance Code for listed companies (“Code”) of the Directors Gabriella Chersicla, Vittoria Giustiniani, Andrea Pellegrini, Patrizia Riva and Maurizia Squinzi. The Board of Statutory Auditors, on the same date also meeting on conclusion of the appointing Shareholders’ Meeting, verified the independence as per statutory law and the Code of its members Francesco Fallacara, Giorgio Loli and Antonia Di Bella. In addition, the Board of Directors confirmed the Independent Director Gabriella Chersicla as Lead Independent Director. The Board of Directors also confirmed the establishment of the following Committees, appointing the members: (i) The Control, Risks and Sustainability Committee, comprising the Independent Directors Gabriella Chersicla (Chairperson) and Maurizia Squinzi and Stefano Fiorini, all with appropriate accounting and financial or risk management experience; (ii) The Remuneration Committee, comprising the Independent Directors Andrea Pellegrini (Chairman) and Vittoria Giustiniani and Luigi Alfieri, all with appropriate finance or remuneration policy knowledge and experience; (iii) The Related Parties Committee, comprising the Directors (all independent) Gabriella Chersicla (Chairman), Andrea Pellegrini and Patrizia Riva. The Board of Directors, on approval by the Board of Statutory Auditors, in addition confirmed Dario Michelangeli as the Executive for Financial Reporting, granting the powers set out under applicable provisions and the By-Laws. The Board of Directors also appointed Simona Dolce, Secretary of the Board of Directors of the company and confirmed, until revocation, Erica Vasini as Internal Audit Manager. Finally, the Board of Directors, following the conclusion of mandate of the previous board, appointed to the company’s Supervisory Board as per Legislative Decree 231/2001, Franco Rossi Galante (Chairman), Iole Anna Savini and Erica Vasini. The Supervisory Board will remain in office until approval of the 2021 Annual Accounts.

OUTLOOK

At the end of the first quarter of 2019, the Group continues to maintain a strong backlog and, thanks also to the contracts signed with international clients since the beginning of the current year, is certain to continue delivering industrial performances in line with the final quarters of 2018, mainly featuring the execution of EPC projects whose production volumes are expected to increase, in line with the scheduling of project execution and with margins reflecting such types of contracts.

The market is decisively favoring downstream segment investments, with a particular focus on infrastructure for the conversion of oil and gas into petrochemical products and for the modernization of existing refinery units, in order to align the type and quality of end product with the altered market demand, which is heavily influenced by recent environmental sector regulatory developments.

In this environment, the technologies of the Group - universally recognized by the petrochemicals and fertilizers sectors - and the top-level refinery and natural gas treatment expertise, which continues to


26

develop and extend to adjacent technologies, in synergy with existing technologies and a flexible business model offering innovative services and products that can anticipate market demand, allow us to therefore forecast the maintenance of a significant backlog.

This outlook is guaranteed by a robust commercial pipeline consisting of initiatives in the Group’s traditional areas, and extending also into new regions characterized by economic stability and raw material availability.

With regards to the Green Acceleration project announced in November 2018, the Group - through the new subsidiary NextChem - is already involved in the Circular Economy sector, thanks to the Group’s investment in Q1 2019 in the most efficient advanced plastics mechanical recycling plant operating in Europe, located in Italy and to become also a reference plant on an industrial scale to support commercial operations focused on converting the major opportunities available both on the domestic and international markets.

The circular economy is one of the three pillars of NextChem’s strategy, together with “Greening the Brown” (offsetting environmental impacts from the conversion of petrol and gas) and “Green- Green” (developing additives and substitutes to oil for fuels or plastics from renewables), of which NextChem has proprietary technologies or agreements for the exclusive use of third party technologies, also set to become subject to intensive commercial development in 2019.

27

9. Statement of the Executive Officer for Financial Reporting in accordance with Article 154-bis, paragraph 2 of the CFA

The undersigned Dario Michelangeli, as “Executive Officer for Financial Reporting” of MAIRE TECNIMONT S.p.A., declares, in accordance with Article 154-bis, paragraph 2 of the Consolidated Finance Act, that the accounting disclosure in this “Interim Report at March 31, 2018” corresponds to the underlying accounting documents, records and entries of the company.

Milan, May 9, 2019

Executive Officer

for Financial Reporting

Dario Michelangeli

Documents

Interim Report at March 31, 2019 - Maire Tecnimont...Interim Report at March 31, 2019 Maire Tecnimont Group 2 Contents 1. Financial Statements 3 Consolidated Income Statement 3 Consolidated