Q3/2021 Quarterly Information

Pandemic continues to impact business development

Also in the third quarter of financial year 2021, HARTMANN's business development remained closely linked to the course of the coronavirus pandemic. Across all business segments, the company generated sales revenues of EUR 1,704.9 million in the first nine months of 2021. This represents a moderate organic sales decline of -5.6% compared to the same period of the previous year. This means that sales have been declining for three quarters in a row.

Although numerous countries in Europe and elsewhere are gradually rolling back their coronavirus restrictions, the development of sales shows that the negative effects of the pandemic are persisting. At the same time, overall positive extraordinary effects of the pandemic have failed to materialize despite the increasing normalization of everyday life, e.g. which has resulted in a higher frequency of visits to doctors and pharmacies, as well as a slightly improved occupancy rate in hospitals and care facilities. In the Wound Management segment, sales in the first nine months of 2021 were only at the pre-pandemic level. In the Incontinence Management segment, sales did not reach pre-pandemic levels. In the Infection Management segment, reorders for disinfection products continued to decline due to the fact that customers are still holding large inventories of such products. Positive contributions in previous quarters, mainly from examination gloves, failed to materialize between July and September.

Ongoing negative effects of the coronavirus pandemic include a significant increase in freight costs and material prices. Similarly, budgetary and cost pressure in the healthcare systems intensi- fied. These market developments had a negative impact on the majority of our business segments.

Recovery continues in Wound Management

sales has not yet been reached. Although bed occupancy rates in medical facilities are on the rise, the increase is moderate. Despite a slight improvement, demand for care products in medical facilities, such as hospitals and retirement homes, remains low overall. Business has increased with solutions for the out-­ patient care of incontinent, active individuals. This includes pants, an incontinence product that is worn like underwear. Bed mats, skin care products and the MoliCare® Premium Elastic incontinence slips also made a positive contribution.

The Infection Management segment recorded sales of EUR 514.9 million in the reporting period. This corresponds to a strong organic decline in sales of -19.6% as compared to the same period of the previous year. Reorders for disinfection products are currently at a low level due to the fact that customers are still holding large inventories of such products. This situation is currently leading to a massive drop in profitability. Neverthe- less, the market for disinfection products is growing compared to pre-pandemic levels as HARTMANN has been able to gain market share despite the current challenges. Demand for personal protective equipment also weakened. In the third quarter of 2021, sales of examination gloves declined.

The Other Group Activities segment generated sales of EUR 318.8 million. This corresponds to an organic increase in sales of 0.6% compared to the previous year. These sales figures include exchange rate effects of -0.6% and in the main the divestment of Sanimed with a decline of -4.9%. At CMC Consumer Medical Care, reduced demand for cosmetic products led to declining sales. KNEIPP continues to successfully serve the trend towards greater health awareness and wellness at home. At KOB, the renewed increase in the number of sporting events led to higher demand for products for sports-related injuries, such as bandages.

In the Wound Management segment, HARTMANN generated sales revenues of EUR 366.0 million in the first nine months of the year. Surgeries and the frequency of visits to doctors and pharmacies increased, so that the recovery of the Wound Management business continued. Compared to the same period of the previous year, organic sales development in the Wound Management segment was up by 10.1%. This means that sales in the first nine months of 2021 are only at the pre-pandemic level. Positive highlights in Q3 included antimicrobial and superab- sorbent wound dressings from the advanced wound care range. Business with traditional wound dressings and Vivano® negative pressure wound therapy also made a positive contribution.

Sales in the Incontinence Management segment amounted to EUR 505.3 million in the first nine months. This corresponds to an organic decline in sales of -2.5% compared to the same period of the previous year, and means that the pre-pandemic level of

Total sales by business segment

in EUR million and percent

Market in Europe declines

Overall, customer sales in the Central, Western, Southern and Northern European regions showed a negative trend compared with the prior-year period. In Central Europe (excluding Germany), there was a strong organic decline in sales of -13.0%. HARTMANN recorded an organic sales increase of 1.3% in Eastern Europe.

The core sales market of Germany contributed -9.6% to the decline in sales of the HARTMANN GROUP as compared to the same

period­ of the previous year. The domestic share in total sales fell to 33.6%. The Asia, Africa and Oceania regions generated organic sales growth of 13.8%. America achieved organic growth of 22.9%. Yet these regions play a subordinate role in the overall development of sales.

Share of total sales by region

in EUR million and percent

America

47.6 | 2.8 %

Europe excl. Germany

947.5 | 55.6 %

Profitability in third quarter at lowest level in three years

Adjusted EBITDA is at EUR 192.0 million for the first three quarters of 2021 - a decrease of -7.3% compared to the first nine months of 2020 - with an EBITDA margin of 11.3%. In the third quarter of 2021 alone, profitability was at its lowest level in three years due to pandemic-related economic conditions in the market.

Equity ratio slightly above comparison period

At the end of September 2021, HARTMANN's equity ratio was 58.6%, and thus higher than the previous year's figure of 57.0%. The net financial position at the end of the 3rd quarter 2021 was EUR 50.0 million and thereby recovered.

Number of employees in the HARTMANN GROUP

31.12.2020 30.09.2021

Stable number of employees

As of September 30, 2021, the HARTMANN GROUP employed 10,652 people worldwide. This figure is slightly higher than at the end of financial year 2020, reflecting an increase of 27 employees. In Germany, the number of employees grew by 55 (+1.3%). This development is largely attributable to the acquisition of the online care portal pflege.de. In the European core markets outside Ger- many, the number of employees fell by 52 (-1.0%). The reason for this is, among other things, the decrease in employees in production at IVF as well as CMC Turkey. Outside Europe, HARTMANN recorded an increase of 24 employees (+2.5%).

Outlook

The course of the coronavirus pandemic remains unclear, especially with regard to governmental measures to cope with the virus and the economic consequences. As a result, there is still a high degree of forecast uncertainty. Positive effects of the pandemic have not developed, and negative effects will continue to affect the company. Increasing freight costs and material prices are also to be expected. Budgetary and cost pressure within the healthcare systems will also remain. The consistent implementation of the Transformation Program, which reached its planned progress milestones for all key projects in the third quarter, is therefore of great importance for the company in view of the current market development. HARTMANN still confirms its forecast for financial year 2021 as published in the Annual Report 2020, which foresees a moderate organic decline in sales and a declining adjusted EBITDA of EUR 210 to 260 million.