1.1 General

Hydratec Industries N.V. (hereinafter referred to as Hydratec) has its registered office and principal place of business in Amersfoort, the Netherlands, and is registered with the Chamber of Commerce under number 23073095.

1.2 Statement of compliance

The Group’s consolidated financial statements were prepared on the basis of the going-concern principle, in compliance with the IFRS Accounting Standards as accepted by the European Union (IFRS-EU), and with Title 9 of Book 2 of the Dutch Civil Code.

1.3 Estimates and judgements by management

Hydratec makes use of estimates and assumptions when preparing the financial statements and the measurement of items in the financial statements.

1.4 Consolidation

Subsidiaries are companies in which Hydratec has direct or indirect control. These participations are regarded as subsidiaries.

1.5 Foreign currency

Transactions in foreign currencies are translated into euros at the average monthly exchange rate for the month in which the transaction took place.

1.6. Financial instruments

Non-derivative financial instruments are trade and other receivables, cash and cash equivalents, borrowings, trade and other payables and the category other under financial fixed assets.

1.7 Intangible fixed assets

Acquired entities are consolidated from the date on which control is transferred. At initial recognition, acquired assets, liabilities and contingent liabilities are measured at fair value.

1.8 Tangible fixed assets

Tangible fixed assets are recognised at acquisition price, less accumulated depreciation and impairment (see accounting policy 1.13).

1.9 Lease assets

The Group recognises lease assets on the commencement date of the lease (the date on which the underlying asset is available for use).

1.10 Inventories

Inventories purchased are recognised at either cost (on the basis of the latest procurement price) or net realisable value less sales costs, whichever is lower.

1.11 Other receivables

At initial recognition, trade and other receivables are recognised in the financial statements at fair value and thereafter at amortised cost, using the effective interest method, less accumulated impairments.

1.12 Cash and cash equivalents

Cash and cash equivalents, comprising bank balances, cash and deposits available on demand are measured at face value. Current account facilities at banks are presented under other liabilities.

1.13 Impairment

Assessments are made every year to check whether there are indications that fixed assets have been impaired. If such an indication is found, the recoverable amount of the asset is calculated.

1.14 Shareholders’ equity

Share capital is designated as shareholders’ equity. The Group has issued no preference shares. Transaction costs for issuing shares are taken to shareholders’ equity.

1.15 Provisions

A provision is recognised in the balance sheet when the Group has an obligation enforceable at law or a constructive obligation as a consequence of an event on or prior to the balance sheet date, and if it is likely that settlement of that

1.16 Taxation

Income tax and other taxation comprise current and deferred taxation.

1.17 Borrowings and lease liabilities

The Group recognises lease liabilities on the commencement date of the lease. They are measured at the present value of the lease payments which are to be made throughout the period of the lease.

1.18 Trade and other payables

At initial recognition, trade and other payables are recognised in the financial statements at fair value and thereafter at amortised cost. The amounts recognised have a term of shorter than one year.

1.19 Net revenue

A distinction can be made between two significant components of net revenue:

1.20 Costs

This relates to the cost of raw materials and consumables including the costs related to their procurement.

1.21 Taxation on profit

Taxation on profit for the financial year comprises taxes payable and receivable for the reporting period and deferred taxation. Taxation on profit is recognised in the statement of profit or loss.

1.22 Accounting policies for the cash flow statement

The cash flow statement has been prepared using the indirect method. A distinction is made in the cash flow statement between cash flow from operating activities, investing activities and financing activities.

1.23 Segment reporting of continuing operations

Hydratec is organised along the lines of the following two operations, which are identified as two reportable segments:

1.24 Discontinued operations

There were no discontinued operations in 2025 and 2024.

1.25 Personnel

The cost of share-based payments, accounted for in accordance with IFRS 2, is €248 thousand (2024: €181 thousand) and consists of the 25% increase in the variable bonus on conversion to shares that is charged in full to the result for the financial

1.26 Average number of full-time employees

1.27 Other operating costs

Royal Pas Reform and Rollepaal have an extensive network of agents. The cooperation procedure with agents is laid down in contracts that include specific provisions and requirements from our Code of Conduct.

1.28 Taxation

The tax expense in the statement of profit or loss relates to income tax calculated on the income for financial reporting purposes from subsidiaries with offices in the Netherlands as well as those with offices outside the Netherlands.

1.29 Intangible fixed assets

An impairment test was carried out in October 2025 on the goodwill of Lan Handling Technologies, Royal Pas Reform and Rollepaal. The value in use was also determined on the basis of future cash flow projections over 5 years.

1.30 Tangible fixed assets

No impairments were recognised in 2025 (2024: €205 thousand). No previously recognised impairments of tangible fixed assets were reversed in 2025 (2024: nil).

1.31 Lease assets

No impairment was recognised in 2025 (2024: nil) and no reversal of impairments took place (2024: nil). For lease liabilities, see note 1.41.

1.32.1 Deferred tax assets

Deferred tax assets can be broken down as follows:

1.32.2. Participating interests

Lias Industries B.V. holds a 60% shar in Proqraft Holding B.V. Lias Industries B.V. must be involved in all decisions.

1.33 Inventories

The provision for obsolete inventories recognised in this measurement amounted to €3.2 million at year-end 2025 (2024: €3.7 million). The drop in inventories is due to an active reduction of these.

1.34 Accounts receivable

The accounts receivable position less the provision for expected credit losses can be analysed as follows:

1.35 Other taxes and social security contributions (assets)

1.36 Cash and cash equivalents

The company’s cash and cash equivalents consist of cash, bank balances and current deposits. €4.1 million of the cash and cash equivalents relates to a prepaid bank guarantee. This was not freely disposable as at 31 December 2025.

1.37 Assets held for sale

There were no assets held for sale on the balance sheet date.

1.38 Shareholders’ equity

Please refer to the consolidated statement of changes in shareholders’ equity.

1.39 Earnings per share

The diluted earnings per share have been calculated by allocating 1,541 (2024: 1,133) conditionally allocated shares to the number of shares.

1.40 Provisions

The provision for personnel-related benefits mainly relates to the liability for anniversary bonuses.

1.41 Financial instruments

The borrowings relate to:

1.42 Other taxes and social security contributions (liabilities)

1.43 Current account at bank

No use had been made of the maximum available current account facility as at the balance sheet date (2024: the same). For the explanation of the group facility, see section 1.46.3.

1.44 Other liabilities, accruals and deferred income

1.45 Financial risk factors

The operations expose the Group to financial risks, such as capital, liquidity, market, credit, currency, raw material price and interest rate risks.

1.46 Off-balance sheet commitments

At year-end 2025, the Group had commitments for €8.2 million to procure plant (2024: €0.3 million).

1.47 Related party transactions

No transactions with related parties took place in 2025 other than:

1.48 Subsequent events

On 2 January 2026, Lias Industries B.V. acquired an additional 20% share in Proqraft Holding B.V. for a purchase price of €8.8 million, fully satisfied in cash.