Softing AG corrects goodwill from goodwill - Outlook remains positiv

EQS-News: Softing AG / Key word(s): Preliminary Results
Softing AG corrects goodwill from goodwill - Outlook remains positiv

15.12.2023 / 16:51 CET/CEST
The issuer is solely responsible for the content of this announcement.

---------------------------------------------------------------------------

At the end of 2023, Softing AG expects goodwill impairments of EUR 7.0
million to EUR 9.0 million at Group level in the Softing IT Networks and
GlobalmatiX divisions.

The background to the impairment of these goodwill is the fact that these
goodwill were created as 'goodwill' at the time of the respective company
acquisition on the basis of the expected income from the known or expected
transactions at the time of the acquisition. It is not possible to reassign
or offset against income from other types of business. Therefore, the
impairment must be carried out even if the newly formed values exceed those
of goodwill.

That is the situation in the present case in both cases.

At the time of Softing's takeover of Psiber Data GmbH, today's Softing IT
Networks, the company had only one product of its own, with revenues mainly
generated by trading business. Since the acquisition in 2014, IT Networks'
business model has evolved from the original trading business to the more
lucrative product business with its own products. The expected sales and
earnings from the product business far exceed the results of the trading
business at that time. Nevertheless, due to the almost complete
discontinuation of the old trading business, a value adjustment is
necessary.

The same applies to the impairment at GlobalmatiX AG. The sales approach and
marketing strategy pursued at the time of the acquisition in 2018 have now
changed significantly, as the original services with comparatively simple
data such as GPS location and standard OBD data sets no longer offer
sufficient returns today. The now established business with data for the
detection and analysis of minor damage, the extraction of complex and
manufacturer-specific data, transmission of data from modern tire pressure
sensors, etc. forms the basis of GlobalmatiX's sales and earnings today. The
plans continue to predict a significant improvement in sales and earnings as
early as 2024. Nevertheless, the value adjustment must also be carried out
here.

The correction of goodwill in both companies is therefore unique. Further
risks arising from goodwill do not exist after this correction.

Dr. Wolfgang Trier, CEO of Softing AG: 'Although both Softing IT Networks
and GlobalmatiX are developing in line with the latest plans and are facing
significant revenue and earnings growth in 2024, we have to make impairments
on the goodwill originally formed due to the changes in the respective
business models that have taken place in recent years. This step will not
have any impact on our main performance indicators of Group operating EBIT
(Group EBIT adjusted for capitalized development activities and their
depreciation and amortization, as well as effects from the purchase price
distribution), Group EBITDA and Group cash flow. Despite a rather subdued
economic environment, we remain optimistic about the coming financial year.'

About Softing AG
Softing is a globally active management holding company. The Softing
companies produce and sell hardware and software in the Automotive
Electronics, Industrial Automation and IT Networks business segments. In
close customer relationships, technologically high-quality standard products
as well as individual solutions are realized. Softing operates in growth
markets with all three business segments.



Contact:
Dr. Wolfgang Trier
CEO


---------------------------------------------------------------------------

15.12.2023 CET/CEST Dissemination of a Corporate News, transmitted by EQS
News - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The EQS Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Archive at www.eqs-news.com

---------------------------------------------------------------------------

   Language:       English
   Company:        Softing AG
                   Richard-Reitzner-Allee 6
                   85540 Haar
                   Germany
   Phone:          +49 (0)89 456 56-333
   Fax:            +49 (0)89 456 56-399
   E-mail:         InvestorRelations@softing.com
   Internet:       www.softing.com
   ISIN:           DE0005178008
   WKN:            517800
   Listed:         Regulated Market in Frankfurt (Prime Standard);
                   Regulated Unofficial Market in Berlin, Dusseldorf,
                   Hamburg, Munich, Stuttgart, Tradegate Exchange
   EQS News ID:    1798275

End of News EQS News Service
---------------------------------------------------------------------------

1798275 15.12.2023 CET/CEST