Vow : Annual and Sustainability Report 2023 (ESEF)

ANNUAL AND

SUSTAINABILITY

REPORT 2023

In Vow and our subsidiaries Scanship, C.H. Evensen and Etia we are passionate about preventing pollution. Our world leading technology and solutions convert biomass, sewage sludge, organic waste and end- of-life tyres into purified water, renewable energy and circular carbon products for a wide range of industries.

ABOUT VOW

World leading technology and solutions which bring value of waste and decarbonise industry

Vow's advanced technologies and solutions enable industry decarbonisation and material recycling. Biomass, sewage sludge, plastic waste and end- of-life tyres can be converted into clean energy, low carbon fuels and renewable carbon that replace natural gas, petroleum products and fossil carbon. The solutions are scalable, standardised, and thoroughly documented, and the company's capability to deliver is well proven.

Vow is a market leader in wastewater purification and valorisation of waste for the cruise industry. The company also has strong niche positions in the food safety, and in heat-intensive industries with a strong decarbonising agenda.

Located in Oslo, the parent company Vow ASA is listed on the Oslo Stock Exchange (ticker VOW).

CONTENTS
About Vow	4
Highlights	5
Letter from the CEO	6
Business segments	10
Board of directors' report	12
Sustainability report	30
Sustainability in Vow	31
Stakeholders and materiality	32
Environment and climate action	35
People and society	45
Sustainability governance	51
Corporate governance	58
Financial statements	68
Financial statements - Vow group	70
Notes to the financial statements - Vow group	74
Financial statements - Vow ASA	104
Notes to the financial statements - Vow ASA	108
Auditor's report	118
Definitions of alternative performance measures not
defined by IFRS Accounting Standards	122

Vow ASA delivered advanced technologies for processing waste and purifying water to a number of cruise ships in 2023.

HIGHLIGHTS 2023

• Record high revenues, with all three business segments experiencing growth.
• Financial results impacted by reassessments of ongoing projects due to cost increases and inflation. The company has implemented a comprehensive cost savings program for 2024.
• Sale of Ascodero completed generating net cash proceeds of EUR 1.8 million.
• Significant demand for C.H. Evensen's large-scale pyrolysis solutions, which is increasingly being embraced beyond the metalurgic industry.
• Scanship announced several important contract wins, which signify the cruise industry's commitment to embracing clean technology.
• Extension order received from Vow Green Metals effectively doubling their production capacity at their biocarbon production plant in Hønefoss, Norway. The order is an extension of the equipment order received in October 2021, resulting in a new total contract value of NOK 332 million.
• Order backlog at the end of 2023 remained strong at NOK 1.0 billion.
• During the year, Vow has continued to demonstrate significant potential in industrial scale-up projects which have attracted the interest of several global industry players.
• Vow ASA was the winner of the Capgemini Nordic Sustainability Tech Award for its pyrolysis technology.

SUBSEQUENT EVENTS

• C.H. Evensen awarded contracts for a combined value of NOK 45 million with major European and Norwegian customers, of which several recurring.
• Scanship awarded contract with major European shipyard for combined value of EUR 19.3 million for delivery to one ship and option for a second. In addition, Scanship secured change order of EUR 2.1 million related to two other existing contracts in the backlog towards the same customer.

REVENUES				EBITDA					BACKLOG (at the end of the year)
NOK million					NOK million					NOK million
1 000					90					1 400
900					75					1 260
800					60					1 120
700					45					980
600					30					840
500					15					700
400					0					560
300					(15)					420
200					(30)					280
100					(45)					140
0					(60)					0
2019	2020	2021	2022	2023	2019	2020	2021	2022	2023	2019	2020	2021	2022	2023

ANNUAL REPORT 2023

ABOUT VOW

5

LETTER

FROM THE

CEO

Dear fellow shareholders,

As we reflect on the past year, it has been a period of significant challenges and opportunities. Despite our best efforts, we faced unexpected hurdles that led to additional costs in our projects and operating expenses soaring beyond our projections. While we experienced growth in certain areas, we also had to contend with the harsh reality of recording negative results.

The year 2023 was a challenging year for the com- pany. Albeit this, we continued to grow our business and reached record high revenues. We have over the years and also in 2023 made investments in new technology and noted significant advancements across many mar- kets. But, as we all know and as the report for the year shows, it has come with high costs. Still, we feel stronger than ever and we expect to see strong returns in the investments and processes initiated.

In parallel with our growth - we tripled our business from 2019 to 2023 - we have expanded the company in several dimensions. We have invested in people, in expertise, in technology, and in tools and infrastructure that improve our ability to manage risks, and which support more effective collaboration.

We are undergoing a tremendous transformation. The Vow that emerges is so much more relevant for green transformation of industries, a Vow which will mean so much more for our markets, our customers, and our investors.

A BUSY YEAR

In Maritime Solutions, we delivered 18 systems to cruise newbuilds and another 12 systems in commissioning. The Aftersales business continued to grow on the back of the large and increasing number of Scanship systems installed.

Several new cruise newbuild and retrofit contracts were awarded in 2023, including two wastewater purification systems and waste handling systems for three ships with delivery scheduled in 2024, 2025 and 2026 respectively.

In early 2024, Vow secured a further contract with a major European shipyard to deliver technology on what

will be one of the world's largest cruise ships under con- struction. Delivery is scheduled for 2024. This contract includes options for similar deliveries to a sister ship in 2025.

In Industrial Solutions, revenues in heat solutions more than doubled from the year before, as high energy costs and costs of emissions drove heat intensive industries across Europe to intensify their efforts to decarbonise and electrify their processes.

With all permits in place, activity picked up on the Rhode Island biochar project with Quonset Soil Solutions from mid-year, and Vow Green Metals progressing with Phase

1. at its Hønefoss (Follum) plant with additional substan- tial delivery of pyrolysis technology.

FINANCIAL RESULTS

Despite the high activity and record high revenues, the financial results for 2023 were far from satisfactory. We saw inflation and increased costs affect ongoing pro- jects. We had to cope with supply chain constraints. And we spent a substantial amount of time and resources on tenders and business development activities, only to experience that interest rates and higher cost of capital caused our partners and prospective customers to postpone final investment decisions.

Fortunately, a strong foundation for the future is still in place. We have undertaken a thorough and critical review of our project portfolio. We have implemented a comprehensive cost savings programme for 2024, and together with signing new contracts we are now cautiously and with determination navigating towards our target of delivering a 15 per cent EBITDA margin from 2025.

ANNUAL REPORT 2023

LETTER FROM THE CEO

7

MARKETS AND PROSPECTS

2023 brought about significant development in our mar- kets, both in cruise, which has been the backbone of our business for many years, and in new industries.

We are pleased, and honoured, that cruise operators are increasingly keen to invest in Vow's zero emission tech- nologies. Our clean ship solutions have been available and high in demand for many years. With our most recent technology, trendsetting customers are able to valorise residues from wastewater and food waste into biochar and energy, bringing the cruise industry one step closer to full circularity.

There are trendsetters in other industries, too. In met- als, Outokumpu, a global leader in sustainable stainless steel, has committed to extensive use of biocoke, and acquired an equity stake in Envigas, a Swedish producer of biocoke. In Norway, Elkem, a leading provider of

advanced silicon-based materials has confirmed a long- term supply agreement for biocarbon with Vow Green Metals. We note with pride that both Envigas and Vow Green Metals are relying on Vow's technology.

We continue to pursue opportunities within end-of-life tyres (ELT). Together with Itochu subsidiaries ETEL and Murfitts Industries, we are completing design of the first ELT recovery plants, likely to be built in the UK. For an international customer, we are designing a plant for treatment of sewage sludge and elimination of PFAS pollution as basis for the customer's investment decision. Similarly, we are waiting for our partner and potential customer to make its investment decision and proceed with the Carib- bean Carbon Refinery® project announced last year.

Where we previously had an addressable market equivalent to what we delivered in revenue last year, our opportunities are now multiplied. Today, we are developing

8

LETTER FROM THE CEO

ANNUAL REPORT 2023

Vow ASA is working with Green Development LLC and Quonset Soil Solutions to build a new state-of-the-art biochar and renewable energy facility. CEO Henrik Badin (left) and COO Jonny Hansen visited the plant in 2023.

new projects with the potential to increase our current order book tenfold in the coming years.

MAKING US MORE RESILIENT

While we wait for our customers and partners to make their investment decisions and initiate projects that we have developed together, we adjust and streamline our company to what our project portfolio and order backlog provide in terms of expected margins and cashflows.

Our uncompromising review of our project backlog has resulted in much improved visibility and certainty of the future. We have intensified project reviews with focus on risks, supply chain management, and cost control to ensure timely delivery of technology, systems and services at agreed costs and quality.

We are training staff and have streamlined and simplified our procedures and our operational setup, all to ensure a more efficient delivery model. We have invested in technology and become much more relevant across a wide range of industries.

We enjoy the trust of highly valued customers and have committed teams of first class and resourceful people. We are supported by Norway's largest bank and long-term strategic shareholders who provide much welcome and constructive feedback and discussions in the board room.

We thank you all for your continued support.

Best regards,

Henrik Badin

CEO of Vow ASA

ANNUAL REPORT 2023

LETTER FROM THE CEO

9

BUSINESS SEGMENTS

Vow's operations are organised across three business segments: Industrial Solutions, Maritime Solutions and Aftersales.

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R	E	V

INDUSTRIAL

SOLUTIONS MARITIME

40% SOLUTIONS

41%

AFTERSALES

19%

INDUSTRIAL SOLUTIONS

The Industrial Solutions segment consists of the subsidiaries Etia and C.H. Evensen. The segment offers proven solutions for turning waste into valuable green products and climate friendly energy, solutions for food sterilisation, and systems for mineral processing.

Etia provides a solid foundation for delivering solutions to rapidly growing segments such as biocar- bon and end-of-life tyres. Through Etia's operations and specific landbased activities in Norway, Vow's Industrial Solutions segment designs and provides systems to valorise biomass residues and waste into renewable products, chemicals and fossil free energy through pyrolysis solutions.

In 2022, Vow acquired C.H. Evensen, a specialist in energy efficient solutions for heat treatment pro- cesses. C.H. Evensen develops, designs and fabricates industrial furnaces and equipment. C.H. Evensen delivers the large-scale pyrolysis reactor (5mt) which is revolutionary of its kind.

10

BUSINESS SEGMENTS

ANNUAL REPORT 2023