Profit Warning by RÁBA Automotive Holding Plc.

RÁBA Plc. has informed its shareholders and the participants of the capital markets on the website of the Budapest Stock Exchange that based on the preliminary assessment of the unaudited information currently available in the course of the reporting for Q1 of 2022, it is deemed that the quarterly consolidated operating profit of the Rába Group for Q1 of 2022 – contrary to the usual course of business – is likely to be negative, potentially meaning a loss of nearly HUF 500 million at group level.

The definitive report for the first quarter of 2022 will be released on May 18, in accordance with the Company’s calendar of events.

The principal reason for the unusual, negative operating result is primarily the considerable loss suffered by Rába Axle Ltd., an energy-intensive operation, which occurred in spite of the usual course of business, sales revenue level and performance, in consequence of the drastic increase in energy prices. Following the energy price explosion experienced in during the last, 2021 business year, the Russian-Ukrainian war has unfortunately led to the preservation of the situation resulting from the high energy price level, the company's statement points out.

In order to eliminate and prevent negative effects and in the interest of maintaining profitability, the Company reacted to the ensuing situation by increasing the flexibility of production and introducing stringent cost management measures and is currently also focusing on improving the efficiency of production processes and of the technology.

It is a great challenge to the Company, like to all participants in the automotive industry, to manage to shift to the customers the fourfold-fivefold increase in the energy prices having occurred in comparison to the average price level of the past decade. In order to maintain the stability of the operation, a key objective is to continue to charge the customers with the energy costs growth and to enforce this growth in the sales prices.