Graphisoft Park Real Estate Development European : Quarterly Report

GRAPHISOFT PARK SE

Interim Management Report - Fourth Quarter 2022

February 21, 2023

GRAPHISOFT PARK SE

BUSINESS REPORT

FOURTH QUARTER 2022

Executive Summary

In 2022, with a rental revenue of 15.54 million euros, we achieved a pro forma net result of 6.02 million euros, which is more than 400 thousand euros higher than the forecast published last November and 24% higher than our previous year's result. The significantly better result than the forecast is due to the following factors:

1. The contractual indexation of rents brought higher revenue due to higher than expected European price indices,
2. we realized small savings in operating costs,
3. the result of other income was also more favorable, due to one-off items.
4. the interest realized on free forint and euro funds increased significantly in the fourth quarter, Based on all of this, the Board of Directors plans to propose to the General Meeting a dividend payment of approximately 5.4 million euros, corresponding to 90% of the 2022 pro forma result, which is approximately 54 euro cents dividend per ordinary share.

Considering the 2022 results and the changes in the economic environment, we also modify our forecast for 2023: in addition to the higher indexation of rents, taking into account the possible need to reduce space due to increased energy prices, the revenue forecast has been increased by 300 thousand euros to

16.3 million euros, which means an increase of nearly 5% compared to the previous year. The utilization of the office park is still exceptionally high, at the end of 2022 it was 97%, the drastic price increase in the market of energy carriers has not caused any significant vacancy so far. Tenants of Graphisoft Park are mostly technology and knowledge-based companies employing highly qualified employees, therefore personnel costs still make up a significant part of the total costs, so the increased utility costs represent only a small proportion of the total cost structure for the majority of tenants. At the same time, we are increasing the Company's operating cost forecast for 2023 by an additional 100 thousand euros: in addition to the inflationary price increase of services, we are also counting the costs of projects that support tenant needs and promote energy efficiency, energy consumption and operation optimization, which we plan to implement in accordance with our ESG strategy that is currently being developed. Based on the above - maintaining the previous forecast for depreciation and for the net financial result - we expect a pro forma net result of 6.3 million euro for the year 2023.

Listing of shares in euros and plan for paying dividends in euros

The Company has convened an extraordinary general meeting for November 29, 2022, in which it requests the authorization of the General Meeting to carry out the necessary technical amendments for the listing of the Company's shares in euros and the payment of dividends in euros. Taking into account that the Company has published its results and declared its dividend proposal in euros, the amendments would make the Company's operation even more transparent. Following the approval of the General Meeting, the Company submitted its request to the Budapest Stock Exchange regarding the modification of the trading currency of the Company's shares in the product brochure, and the changeover (start day of euro- based trading) date of February 15, 2023, also considering the IT and administrative tasks arising at the organizations managing securities accounts. In accordance with the relevant decisions of the Budapest Stock Exchange, HUF-based trading ended on February 10, 2023. Then, after the two-day suspension necessary for the transition and the smooth settlement of transactions still concluded in HUF, trading in euros started on February 15, 2023. The conditions for the payment of the dividend in euros are still under investigation, the Company will publish information on the related processes later.

2

GRAPHISOFT PARK SE

BUSINESS REPORT

FOURTH QUARTER 2022

Property portfolio and fair value of net assets

At the end of 2022, the independent valuer estimated the fair value of the real estate portfolio at 231 million euros, which represents a decrease of more than 10 million euros compared to the end of 2021.

The fair value of the completed and delivered properties decreased by 3 million euros compared to the previous year end. As a result of the drastic jump in energy prices, rising inflation and general market uncertainty, risk factors and the yield that quantifies them have increased, however, thanks to the stable tenant base of the office park and the stably high utilization of the buildings, this caused a moderate (1%) decrease in the value of the properties.

At the same time, the value of the development lands decreased by more than 7 million euros. The decrease is primarily due to the further uncertainty of the remediation of the Northern Development Area (refer to our announcements on June 21, 2022, and on January 2, 2023). The value of the development lands is also reduced by the significant increase in the expected cost and time requirements of future developments. The well-knownreason for this is the drastic increase in raw material prices and labor costs.

Due the previously persistently low interest rates in the eurozone, which are not expected to decrease significantly in the next 1-2 years, the fair value of the interest rate swap hedging transactions concluded by the Company to fix the interest rates of its euro-based loans has increased significantly1, by around 9 million euros compared to prior year, which increase is reflected in equity (net asset value). In the meantime, the Company's outstanding loan portfolio continued to decrease, from over 97 million euros at the end of last year to below 91 million euros. In addition to the loan repayments and the approximately

4.4 million euro dividends paid during 2022, the Company's cash balance increased to nearly 12 million euro by the end of the year, which ensures the long-term safe operation of the company, the financing of individual tenant designs, building upgrades and renovations, and also forms a reserve for the possible negative effects of the changing economic environment.

As a result of all this, despite the decrease in the fair value of the real estate portfolio by around 10 million euros, the net asset fair value of the Company exceeded the previous yearend's value by more than 7 million euros and reached 157.6 million euros.

[thousands of EUR]

1 The fair value of hedges is intended, among other things, to estimate how much more expensive (in the case of a negative fair value, cheaper) a similar loan could be obtained today. In addition to the current market interest rate environment, the fair value is influenced by several external factors (HUF/EUR exchange rate, monetary policy measures or future interest rate expectations). The development of these factors may result in a significant and in some cases unpredictable changes in the direction and degree of change in the fair value.

3

GRAPHISOFT PARK SE

BUSINESS REPORT

FOURTH QUARTER 2022

Pro forma results and forecast

Our 2022 "pro forma" results developed more favorable than expected: rental revenue reached 15.54 million euros due to the stable occupancy level and higher than expected indexation, which means an increase of about 760 thousand euros (5%) compared to 2021. In 2023, in addition to the higher indexation of rents, we plan a further moderate growth of 5% and expect a rental income of 16.3 million euros, also considering smaller area reduction needs due to the economic situation and uncertainty. In 2022, the increase in operating costs was largely related to personal payments (among other things, the Company's employees received a one-timeinflation-compensating payment in the third quarter of 2022), at the same time, the increase in fees for certain services was offset by the weakening of the forint during the year. When planning the operating costs for 2023 - which, according to our current estimates, may exceed this year's costs by nearly 400 thousand euros - in addition to the further inflationary increase in the price of services, we also take into account the costs of other tasks arising in accordance with our ESG strategy (projects that optimize the efficiency of building operations and energy consumption, developments enabling the measurement and analysis of the data required for these), which is currently being developed. Most of the other income reflects the result of constructions and renovations of rental properties ordered by tenants, which are not expected to change significantly compared to previous years. Based on the above, in 2022 the EBITDA reached 14.76 million euros, almost 6% higher than the previous year's level, and in 2023 it may increase further and reach 15 million euros. Depreciation in 2022 - due to the depletion of some older assets - decreased by around 160 thousand euros, and in 2023 it is expected to decrease by another 100 thousand euros. As a result of regular loan repayments, the interest to be paid on the outstanding debt is reduced, and the interest income realized on free funds is also favorable, but at the same time, due to the volatility of the forint, the exchange rate loss on forint denominated assets may reduce the financial result. In 2022, changes in the interest rate environment resulted in a significant 11% reduction in the net financial costs. At the same time, in 2023, taking into account the expected significant exchange rate fluctuations, we expect a higher net financial cost of around 1.8 million euros. As a result of all this, the pro forma net result in 2022 increased by about 24% and reached 6.02 million euros, and in 2023, with further moderate growth, it may reach 6.3 million euros.

4

GRAPHISOFT PARK SE

BUSINESS REPORT

FOURTH QUARTER 2022

We are right in our pursuit of the "micro Silicon Valley" concept articulated some 25 years ago. Even during recessionary economic prospects and long-term changing and transforming office use needs, it is worth focusing on a well-defined customer base in real estate development, in our case, domestic and international companies dealing with technological development. Attracting talent is the key to success in this area. This is greatly enhanced by the high-quality and environmentally conscious architecture, a uniquely quiet park rich in ancient trees, on the truly green bank of the Danube, surrounded by the monuments of the former Óbuda Gas Factory and preserved in a modern way.

5