Gloster acquired a 70% stake in two software development companies

Special NOTICE

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Gloster Infocommunications Public Limited Company (company registration number: 13-10-042012; registered office: 2142 Nagytarcsa, Csonka János Street 1/A, Building A/2; hereinafter: the Company, Gloster) in accordance with applicable laws, in particular Act CXX of 2001 on the Capital Market.

In accordance with the Act (“Tpt.”) and the General Rules of the Budapest Stock Exchange, we hereby inform our esteemed investors of the following.

Gloster acquired a 70% stake in two software development companies

As a result of this move, the dividend paid to Gloster will increase by nearly one and a half times

Most recently, BMW in Munich awarded a software development contract worth 15 million EUR[1] from BMW in Munich, as well as its 51% stake in the German company Gloster GmbH—which won a 700,000-euro contract from Audi—Gloster has acquired an additional 19% stake.

These transactions are the second steps in previous equity acquisitions[2] [3], for which all conditions have been met; the necessary administrative steps and commercial registry procedures are currently underway. This step creates value for shareholders because, as early as 2024, the dividends attributable to Gloster from the Companies’ earnings will increase by nearly one and a half times (dividends attributable to external owners amounted to nearly 206 million HUF in 2023). Gloster financed the transactions entirely from its own resources, without resorting to bank financing (its debt level did not increase) or conducting a capital increase (shareholders’ stakes were not diluted).

Gloster-Minero IT Hungary Ltd.

Gloster-Minero IT Hungary Kft., which has been a successful supplier to the German automotive industry for more than ten years, continues to operate with the same management and geographic focus as a German-Hungarian joint venture between the Munich-based multinational Sulzer GmbH and Gloster.

Sulzer GmbH, a Bavarian IT company founded in 1978 and co-owned by a Bavarian partner, operates offices in ten locations around the world—including the U.S. and India—and, with revenue of approximately 80 million EUR and a workforce of 650, is the 16th-largest IT supplier to the German automotive industry[4]. Its clients include BMW, Audi, BASF, MAN, Daimler, and Skoda, among others.

Despite Germany's economic problems, Gloster's global client, BMW, continues to grow steadily; in 2023, it sold 2,555,341 cars, representing a 6.5% increase compared to 2022[5].

Gloster GmbH.

Gloster GmbH, winner of the “Audi Innovation Award,” was founded in 2009 with the goal of providing high-quality nearshore services to the German market. The founding owners had previously worked as external IT consultants at Volkswagen AG and AUDI AG, so they already had the network of contacts needed to launch the business.

The goal of this additional acquisition is to build on Gloster GmbH’s existing successful local operations—in line with the 2026 strategy—so that Gloster can establish a local presence and its own sales office in the DAH region (Germany, Austria, Switzerland)—to secure additional long-term, high-value, high-margin software development contracts—not limited to the automotive industry. In 2022, through Gloster GmbH, the group won a project worth 700,000 EUR to modernize the reporting system for German Audi manufacturing[6], which was extended on July 2, 2024, for the same amount[7].

Another step toward implementing the strategy

This move is in line with Gloster’s Investor Presentation published on April 23, 2024[8], in which the company announced that it would acquire additional equity stakes in its existing, high-performing subsidiaries in order to boost profitability.

Two investment firms are tracking Gloster’s stock: Equilor has a 12-month target price of 1,396 Ft per share (hold recommendation), while ERSTE has a target price of 1,183 Ft per share (buy recommendation).

This announcement does not contain any information previously designated as inside information; it merely informs investors of the implementation of the measures promised in previous disclosures.

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About Gloster

Gloster is a broad-spectrum international IT service provider listed in the BSE’s Standard category. Over the course of its more than 20-year history, it has evolved from a hardware-focused garage startup into a software-focused international mid-sized company. Thanks to Gloster’s aggressive growth strategy, it has completed eleven transactions since 2018 and expanded its operations into the areas of systems integration, cloud solutions, and international software development services. The group currently employs a team of nearly 350 people; according to its most recent consolidated financial statements for 2023 (prepared in accordance with Hungarian accounting standards), its adjusted revenue was 10.3 billion forints, and its adjusted EBITDA was 976 million forints.

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Nagytarcsa, August 22, 2024

Gloster Infocommunications Plc.

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Further information:

Dr. Eszter Bassola

investor relations officer

bassola.eszter@gloster.hu

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[1] Gloster Wins a 15 Million EUR Industrial Software Development Contract from BMW https://gloster.hu/uploads/befektetoknek/kozzetetelek/rendkivuli-tajekoztatasok/Press-Release-Gloster-Wins-15-Million-EUR-Contract-from-BMW-6672898577f31.pdf

[2] Gloster acquired an automotive software developer serving the German market https://gloster.hu/uploads/befektetoknek/kozzetetel/rendkivuli_tajekoztatasok/14863-Nemet-piacra-szolgaltato-autoipari-szoftverfejlesztot-vett-a-Gloster.pdf

[3] Gloster is preparing to acquire VW and Audi’s software supplier in Germany https://gloster.hu/uploads/befektetoknek/kozzetetel/rendkivuli_tajekoztatasok/21204-Special-Announcement-_Gloster-is-set-to-acquire-VW-and-Audi's-software-supplier.pdf

[4] https://www.sulzer.de/news/top-25-it-dienstleister-sulzer-gmbh-in-top-20-etabliert/

[5] 2023 (Full Year) Global: BMW and MINI Sales Worldwide

https://www.best-selling-cars.com/brands/2023-full-year-global-bmw-and-mini-sales-worldwide/

[6] June 7, 2022 - Gloster has won a software development contract worth 700,000 euros from the German company Audi https://gloster.hu/uploads/befektetoknek/kozzetetel/rendkivuli_tajekoztatasok/19920-Special-Announcement---Gloster-Wins-700,000-Euro-Software-Development-Contract-from-German-Audit.pdf

[7] July 2, 2024 - Gloster has won a software development contract worth more than 700,000 euros from the German company Audi https://gloster.hu/befektetoknek/kozlemenyek/01907289-8832-78b7-bffd-2d351de138c5

[8] https://gloster.hu/uploads/befektetoknek/tarsasagra-vonatkozo-alapinformaciok/befektetoi-prezentacio/Befektetoi-prezentacio-2024-tavasz-660284703a94f.pdf