New products

IEK GROUP^[1] (hereinafter - the Group, or the Company), one of the Russian leaders in the production of comprehensive electrical solutions and industrial automation, publishes the condensed interim consolidated financial statements for the first half of 2025.

Andrey Zabelin, General Director of IEK GROUP:

"The results of the first half confirm the effectiveness of our strategy based on investments in technological development and uniting competencies and business directions into a single structure. We are not only increasing turnover through assortment expansion, production localization, and launching new premium products on the market but also laying a solid foundation for long-term growth by expanding comprehensive offerings for customers and integrating new assets. We are confident that the chosen course will strengthen our leadership in the market and open new opportunities for expansion into adjacent segments".

Mikhail Gorbachev, First Deputy General Director of IEK GROUP:

"In conditions of a difficult macroeconomic situation - high key rate, inflation, and rising costs - IEK GROUP demonstrated confident results: revenue grew by 19%, and adjusted EBITDA - by 42% compared to the same period last year. This confirms that our business model works more efficiently than the market and allows adapting even in difficult conditions. The increase in debt burden in the reporting period is related to the implementation of development plans, while its level remains manageable, and the company confidently fulfills all obligations. Further development of own production, increase in operational efficiency, and launch of innovative solutions on the market will become the basis for sustainable growth of IEK GROUP in the future".

MANAGEMENT COMMENTS

Operational results

• In the current macroeconomic conditions, the Company's focus in the first half of 2025 was on maintaining high revenue growth rates and business profitability, as well as improving operational efficiency and cost control.
• Despite the slowdown in the growth rate of the electrical equipment market, the dynamics of the Company's revenue growth continue to exceed the market's^[5].
• The greatest demand for IEK GROUP products was observed in the segments of commercial construction, industry, as well as infrastructure projects.
• The integration of assets acquired from the Legrand group continued, including the localization of part of the assortment at the Company's production sites in the Ulyanovsk region.
• In Balabanovo (Kaluga region), work continued on launching the Group's new production cluster for the full range of metal cable management systems. This will improve the competitiveness of manufactured products by concentrating all key production competencies at one site. The official launch of the site is planned for autumn 2025.
• The company significantly enhanced its own information security by implementing new protection systems against external threats.

Product line

• The IEK GROUP assortment exceeded 40 thousand items by the end of the period.
• The Company continues to maintain a strategic focus on strengthening positions in the high-margin premium segment, distinguished by product functionality and the possibility of integration into complex systems.
• In the first half of 2025, the share of high and medium segment products in the sales structure grew by 8.1 p.p. to 52.5% (H1 2024 - 44.4%).
• The active launch of the company's flagship new products in the power equipment segment continued, including low-voltage switchboards for 4000 and 6300 amperes.
• Sales volumes for the FORTE&PIANO line of wiring devices series grew, which received the prestigious iF DESIGN AWARD in 2025 in the "Product Design" nomination (Building Technology).
• The company continues to develop the "ITK Uninterruptible Power Supplies" business direction, which shows significant sales growth thanks to the launch of new warehouse and project products. Major projects for customers from the transport infrastructure and healthcare sectors, as well as the banking sector, were implemented in this direction.
• In the reporting period, the Company consolidated all digital solutions under the single brand IEK DIGITAL - an ecosystem of domestic IIoT[^6] solutions for production automation and critical infrastructure facilities. This solution forms the basis for the long-term development of the Company's digital product line and strengthening our positions in one of the most dynamically developing and capital-intensive market segments.

Financial results

Revenue of the company amounted to 26.8 billion rubles, exceeding the same indicator of 2024 by 19%.

The company continues to demonstrate confident revenue growth despite turbulence and external challenges. The main contribution was provided by the segments of low-voltage equipment, universal systems for transmitting electricity, as well as telecommunication systems.

Revenue dynamics were mainly driven by growth in sales of high and medium segment products, new products, as well as price indexation against the backdrop of inflationary pressure.

The EBITDA indicator grew in the first half of 2025 relative to the indicator of the same period of 2024 by 19% to 7.5 billion rubles. The growth of the indicator is due to an increase in sales volumes, while the negative impact was the increase in transport and forwarding expenses due to market conditions.

The adjusted EBITDA indicator for the first half of the year amounted to 2.8 billion rubles, which is 42% higher than the indicator of the same period of 2024. The growth was influenced by an increase in the share of sales of high-margin products, a decrease in procurement costs, and an increase in operational efficiency. Profitability by adjusted EBITDA increased by 2 p.p. relative to the first half of 2024.

Net profit increased in the first half of 2025 relative to the indicator of the same period of 2024 by 28% to 4.8 billion rubles. The growth of the indicator was influenced by good results of the main activity and tax adjustment for associated companies, while the increase in interest expenses had the opposite effect.

The net debt to adjusted EBITDA indicator for H1 2025 amounted to 2.9x compared to 2.7x for the year ended December 31, 2024.

The dynamics of net debt reflect the growth of attracted borrowed capital for implementing investment activities (including for purchasing, constructing, and modernizing production sites), as well as M&A activity.

• In March 2025, the Company placed bond issue series 001P-03 for 2 billion rubles. The attracted funds were directed to restructuring the existing credit portfolio and improving debt servicing conditions. As of June 2025, the Company has two bond issues in circulation with a total nominal volume of 4 billion rubles, with the share of retail demand in applications at the primary placement being 36% and 35%, respectively.
• Previously, the Company was assigned a credit rating of ruA- by Expert RA.
• The current level of debt burden is comfortable for the Company. At the same time, IEK GROUP is working on refinancing the current debt under more favorable conditions of a reduced key rate.

Capital expenditures for the reporting period amounted to 2.3 billion rubles. Mainly, expenditures were directed to preparing for the launch of the new production complex in Balabanovo, maintaining and developing main production capacities, and M&A deals.

M&A

In 2025, a decision was made to fully integrate the former assets of the Legrand group into the structure of IEK GROUP, which, due to synergistic effects and cost optimization, will create a basis for increasing profitability in the future.

In June 2025, IEK GROUP successfully completed the strategic acquisition of the company "EMBIOT" (brand ámbiot) - a developer of solutions for IIoT, smart cities, and infrastructure lighting. The ámbiot platform is included in the register of Russian software, which allows complying with new tender requirements for the priority procurement of domestic software and the transition of critical information infrastructure objects to Russian solutions from September 1, 2025.

Strategic partnerships

In June 2025, JSC "Kontaktor" (former assets of the Legrand group, part of the Group's structure) and the Ulyanovsk region signed an agreement on the implementation of an investment project to organize the production of electrical equipment in the region. The planned investment volume in the project is estimated at 2 billion rubles; the launch of production will create up to 300 new jobs in the region. The new site will be located on the territory of the future special economic zone (SEZ) of industrial-production type.

Corporate governance

The IEK GROUP Board of Directors was strengthened by three independent members possessing significant professional experience in the field of strategic development, financial management, and personnel management, who also held management positions in leading multinational companies in the Russian Federation. Three new committees were created for audit, strategy and investments, as well as remuneration and nominations, which were headed by independent directors. These changes reflect the Company's movement towards higher standards of corporate governance, transparency, and accountability to shareholders and partners.

[1] JSC "IEK HOLDING" (OGRN 1255000000034) together with organizations controlled by it.

[2] The sum of indicators in the lines "Long-term borrowings" and "Short-term borrowings" minus the indicator in the line "Cash and cash equivalents" of the consolidated statement of financial position.

[3] Calculated based on the Adj. EBITDA indicator for the last 12 months and net debt as of 30.06.2025.

[4] Calculated based on the Adj. EBITDA indicator for 2024 and net debt as of 31.12.2024.

[5] According to the company's estimates based on key consumption segments: construction (MCD, IHS, Commercial), Industry, Retail, Infrastructure, Utilities.

[6] IIoT (Industrial Internet of Things) - industrial internet of things.