COSOL : HY22 Results Presentation

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COSOL Limited FY22

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Important Notices & Disclaimer

USE OF THIS DOCUMENT

You must read the following notices before reading or making any use of this document or any information contained in this document. By continuing to read, use or otherwise act on this document, you agree to be bound by the following terms and conditions, including any modifications to them, and make or give the acknowledgements, representations or warranties (as applicable).

This presentation is provided for information purposes only. The information in this presentation is in a summary form, does not purport to be complete and is not intended to be relied upon as advice to investors or other persons. The information contained in this presentation was prepared by COSOL Limited (COSOL) as of its date, and remains subject to change without notice. This presentation has been provided to you solely for the purpose of giving you background information about COSOL.

This presentation should be read in conjunction with COSOL's other periodic and continuous disclosure announcements lodged with ASX, including COSOL's Annual Report for the financial year ended 30 June 2021.

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Such statements are not guarantees of future performance, and involve known and unknown risks, uncertainties, assumptions, contingencies and other factors, many of which are outside the control of COSOL. No representation is made or will be made that any forward-looking statements will be achieved or will prove to be correct. Actual results, performance, operations or achievements may vary materially from any forward-looking statements. Circumstances may change and the contents of this

presentation may become outdated as a result. Readers are cautioned not to place undue reliance on forward-looking statements and COSOL assumes no obligation to update such statements. No representation or warranty, expressed or implied, is made as to the accuracy, reliability, adequacy or completeness of the information contained in this presentation.

PAST PERFORMANCE

Past performance information given in this presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance.

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This presentation is not, and is not intended to constitute, financial advice, or an offer or an invitation, solicitation or recommendation to acquire or sell COSOL shares or any other financial products in any jurisdiction and is not a prospectus, product disclosure statement, disclosure document or other offering document under Australian law or any other law. This presentation also does not form the basis of any contract or commitment to sell or apply for securities in COSOL or any of its subsidiaries. It is

for information purposes only.

COSOL does not warrant or represent that the information in this presentation is free from errors, omissions or misrepresentations or is suitable for your intended use. The information contained in this presentation has been prepared without taking

account of any person's investment objectives, financial situation or particular needs and nothing contained in this presentation constitutes investment, legal, tax or other advice. The information provided in this presentation may not be suitable for your specific needs and should not be relied up on by you in substitution of you obtaining independent advice. Subject to any terms implied by law and which cannot be excluded, COSOL accepts no responsibility for any loss, damage, cost or expense (whether

direct, or indirect, consequential, exceptional or special damages including but not limited to loss of revenue, profits, time, goodwill, data, anticipated savings, opportunity, business reputation, future reputation, production or profit, any delay costs, economic loss or damage) incurred by you as a result of any error, omission or misrepresentation in this presentation.

PRESENTATION OF INFORMATION

All currency amounts in this presentation are in Australian dollars unless otherwise stated. Amounts in this document have been rounded and any differences between this document and COSOL's financial statements are due to rounding.

AUTHORISATION

This presentation is dated 24 February 2022 and was authorised for release by the Board of COSOL.

For more information, please contact: Ben Buckley, T [phone], E [e-mail]

COSOL Limited ABN 66 635 371 363

Level 3, 201 Leichhardt Street, Spring Hill QLD 4000

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COSOL Limited

H1 FY22 Financial Highlights

COSOL delivered strong revenue and EBIT growth while protecting margins through a period of acquisition and investment in capability.

Group Results	Revenue	EBIT	NPAT
0.92 cents (Fully Franked)	$22.6M	$3.6M	$2.6M
Interim Dividend =

Group revenue	Group EBIT	Group	NPAT	Basic EPS
$22.6M	$3.6M	EBIT %	$2.6M	1.93 cents per share

+44%	+40%	+16%	+41%	+35%
on pcp	on pcp		year on year

• Strong Balance Sheet - cash balance of $5.65M and net debt of $10.3M* (at 31/12/21)
• Fully franked interim dividend of 0.92 cents per share

*Including deferred consideration

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First Half FY22 Financials

Profit & Loss Summary

	H1 22	H1 21
Revenue	22,565	15,654
Gross profit	9,847	5,698
Gross profit %	44%	36%
EBITDA	3,793	2,833
EBITDA %	17%	18%
Depreciation & amortisation	(219)	(269)
EBIT	3,574	2,564
EBIT %	16%	16%
NPBT	3,466	2,518
NPAT	2,599	1,845
EPS	1.93 cents	1.43 cents
Cash conversion	117%	271%
Net debt	10,300	960
Dividend	0.92 cents per share	0.5 cents per share

Notes

• Clarita Solutions consolidated from 1 September 2021, positive revenue and EBIT contribution
• Group EBIT Margin of 16% consistent with prior periods
• Continued strong cash conversion
• Increase in net debt was to fund the acquisition of Clarita Solutions including deferred consideration

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First Half FY22 Financials

Cash Flow

Cash from Operations	H1 22	H1 21
Receipts from customers	24,932	16,307
Payment to suppliers	(20,777)	(10,764)
	4,155	5,543
Other operating cash flows	(100)	33
Income taxes paid	(498)	(822)
Net cash flow from operating	3,557	4,754
Cash flow from Investing
Payment for purchase of business	(6,638)	(851)
Deferred consideration	(2,795)	(3,705)
Other investing	(466)	(33)
Net cash flow from investing	(9,899)	(4,589)
Cash flow from Financing
Proceeds from Issue of shares	694	-
Proceeds from net bank borrowings	8,563	2,750
Repayment of lease liabilities	(154)	(259)
Dividends paid	(1,330)	-
Net cash flow from financing	7,773	2,491
Net increase / (decrease) in cash	1,431	2,656
Cash at beginning of year	4,184	6,775
Exchange rate movements on cash	35	(69)
CASH AT END OF PERIOD	5,650	9,362*

* Includes client advances of $3.65M

Notes

• Positive cash flow from operations due to strong focus on working capital management
• $6.6M cash outlay (net of cash acquired) for the acquisition of Clarita Solutions
• $2.8M paid to original COSOL vendors as final deferred consideration payment after achievement of maximum payout threshold due to continued strong business performance
• Cash from financing included a net borrowing of $8.56M to fund acquisition of both Clarita Solutions and the deferred consideration for Australian business
• Paid $1.33M in dividends to shareholders during the half