Glossary

5S Methodology

5S is a method for organizing a work space for efficiency and effectiveness in order to reduce industrial accidents.

Aftermarket segment

The market concerned with the maintenance/repair of investment goods or long-life final goods (e.g. vehicles) or the sale of replacement parts or complementary parts for the goods. This involves the sale of services and / or parts that are directly related to the previous sale of the goods.

APAC

Abbreviation for the Asia-Pacific region.

Asset-backed securities (abs) program

A specific way of converting payment claims into negotiable securities with a financing company.

Best-landed cost approach

Assessment of the total costs of a product including the price of the product as well as the charges for shipping, taxes and/or duties.

Bubble assignment

Short-term exchange program for employees to promote internal knowledge transfer, intercultural awareness, the development of networks and the individual development of participants.

CDP

Formerly “Carbon Disclosure Project,” non-governmental organization focusing on environmental reporting in the areas of climate, water and forests.

Circular economy

The circular economy corresponds to a regenerative economic system in which the use of resources, waste production, emissions as well as energy consumption are minimized. The basis for this is formed by long-lasting and closed material and energy cycles.

CO2 equivalents

CO2 equivalents illustrate the global warming potential of various gases that are harmful to the climate and show how much a specific quantity of a greenhouse gas contributes to the greenhouse effect. The comparative value used here is carbon dioxide (CO2). The index thus expresses the warming effect of a greenhouse gas over a clearly defined period of time compared to that of CO2.

Code of Conduct

A set of policies that can and should be applied in a wide range of contexts and environments depending on the situation. In contrast to a rule, the target audience is not obliged to always comply with the Code of Conduct. A Code of Conduct is more of a personal commitment to follow or abstain from certain patterns of behavior, ensuring that nobody gains an unfair advantage by circumventing these patterns.

Commercial Paper

Commercial Paper (CP) is a short-term bond issue with a money market character.

Compliance

Conforming to rules: a company and its employees adhering to Codes of Conduct, laws and guidelines.

Conflict minerals

Natural resources whose deposits are largely located in conflict regions (especially the Democratic Republic of Congo), where they are mined and traded in some cases in serious violation of international law; especially tin, tantalum, tungsten and gold.

Corporate governance

A set of all international and national rules, regulations, values and principles that apply to companies and determine how these companies are to be managed and monitored.

Corporate responsibility

A form of corporate self-regulation integrated into a business model by taking societal and environmental aspects into account.

Corporate Volunteering

Corporate volunteering refers to the voluntary, employer-sponsored sponsored by the employer of employees in social or ecological areas and activities.

Covenants

Covenants is a collective term for additional contractual clauses or ancillary agreements in loan agreements or bond conditions. They contain future obligations on the part of the borrower or bond debtor to perform or refrain from performing a certain act.

Coverage

The regular assessment of the economic and financial situation of a listed company by banks or financial research institutions.

Cross-selling effects

The action or practice of selling an additional product or service to an existing customer.

CSR-RUG

German CSR Directive Implementation Law.

Diversity Management

Diversity management is a central element of human resources policy, which diversity of employees in terms of gender, age, ethnic origin, religious beliefs ethical background, religious beliefs, sexual identity or possible disabilities for the success of the company.

Due Diligence

Refers to the examination and analysis of a company with “due diligence”, especially with regard to economic, legal, tax and financial circumstances.

Earnings before interest, taxes and amortization (EBITA)

EBITA describes earnings before interest, taxes and amortization of intangible assets. For long-term comparison and a better understanding of business development, NORMA Group adjusts the EBITA for certain one-time expenses.  NOTES

Earnings before interest, taxes, depreciation and amortization (EBITDA)

Earnings before interest, taxes, depreciation (of property, plant and equipment) and amortization (of intangible assets). It is a measure of a company’s operating performance before investment expenses. For long-term comparison and a better understanding of its business development, NORMA Group adjusts the EBITDA for certain one-time expenses.  NOTES

EBITA margin (adjusted)

The adjusted EBITA margin is calculated from the ratio of adjusted EBITA to sales and is an indicator of the profitability of NORMA Group’s business activities.

EBITDA margin (adjusted)

The adjusted EBITDA margin is calculated from the ratio of adjusted EBITDA to sales.

Economies of scale

Describes the ratio of production volume to the factors of production factors. In the case of positive economies of scale increases with the intensification of the production factors the quantity of output also increases.

Elastomers

Stable but elastic plastics that are used at a temperature above their glass transition temperature. The plastics can deform under tensile or compressive load, but then return to their original shape.

EMEA

Abbreviation for the economic area of Europe (comprising Western and Eastern Europe), the Middle East and Africa.

Engineered Joining Technology (EJT)

One of NORMA Group’s two ways to market. It provides customized, highly Engineered Joining Technology products primarily, but not exclusively, for industrial OEM customers.

ESG

ESG stands for Environmental, Social and Governance. The abbreviation refers to the commitment of companies in the areas of environment, social affairs and corporate governance.

Equity ratio

Equity in relation to total assets.

EU Taxonmy

The EU Taxonomy represents a detailed classification system designed to provide the greatest possible transparency to the capital market in order to encourage investment in environmentally sustainable activities. It

also establishes, for the first time, a link between financial and non-financial issues in order to provide an objective and consistent assessment of the sustainability of economic activities. The EU Taxonomy was originally designed by the European Commission as part of its climate policy positioning following the Paris Climate Agreement in 2019. It is based on the European Green Deal and aims to establish reporting requirements that increase the informative value of companies' non-financial reporting.

Fair value

Fair value is the amount for which an asset could be exchanged, or a liability settled, between market participants in an arm's length transaction at the measurement date. In principle, it is a value concept for the measurement of assets or liabilities. Fair value is used in particular for the measurement IAS 40 in conjunction with IFRS 13.

FAO

Food and Agriculture Organization of the United Nations.

Foresight management

Long-term strategic planning based on an analysis of changing environmental conditions (e.g. technology trends and changes in the market environment).

Free cash flow

Indicates the amount of money that is available to pay dividends to shareholders and / or repay loans.

Gearing

Gearing is a measure of a company’s debt level. Gearing is calculated from the ratio of net debt to equity.

Gemba walk

Daily walk through production halls, inspecting individual processes in the opposite order of workflow and analyzing potential opportunities for improvement.

Global excellence program

A cost optimization program. It coordinates and manages all of NORMA Group’s sites and business units.

GRI – Global Reporting Initiative

Initiative that sets standards for sustainability reporting.

IATF 16949

An international standard that combines the existing general demands on quality management systems of the (mostly North American and European) automotive industry.

IDW

The Institute of Auditors in Germany (Institut der Wirtschaftsprüfer in Deutschland e. V.)

Initial public offering (IPO)

First offering of shares of a company on the regulated capital market.

Innovation roadmapping

Systematic approach to adapt company-specific product innovations to future market and technological developments.

Innovation scouting

Structured observation of changes, potentials and relevant knowledge of technological developments and processes.

International securities identification number (ISIN)

12-digit alphanumerical code used to identify a security traded on the stock market.

International Labour Organization (ILO)

The ILO was founded in 1919 and has its headquarters in Geneva. The aim of the ILO is to the improvement of the working and living conditions of all people, the world peace by improving the working and living conditions of all people. To this end, legally binding agreement and conventions as well as labor and social standards has been defined.

ISO 14001

An international environmental management standard that specifies the internationally accepted requirements for an environmental management system.

ISO 9001

International standard that defines the minimum requirements that quality management systems must meet.

ISO 45001

Health and Safety Management that replaces the current Occupational Health and Safety Assessment Series 18001 (OHSAS 18001)

Lean manufacturing

A systematic method for the elimination of waste within a manufacturing process. An integrated socio-technical system reduces or minimizes supply-side, customer-side and internal fluctuations.

Leverage

Leverage is a measure of a company’s debt and is calculated as the ratio of net debt (without hedging instruments) to adjusted EBITDA over the last 12 months (LTM). For the purpose of a better comparison, adjusted EBITDA LTM includes the companies acquired during the year.

Lockout-tagout

Safety procedure used to ensure that dangerous machines are properly shut off and not able to be started up again prior to the completion of maintenance or repair work.

Long-term assignment

Long-term exchange program for employees to promote internal knowledge transfer, intercultural awareness, the development of networks and the individual development of participants.

Long-term incentive plan (LTI)

Multi-year variable compensation in the form of stock rights for executives and other specific employee groups, representing a cash-settled share-based compensation plan in the form of virtual shares. It takes into account both the development of the company as well as that of the share price.

Material cost ratio

The material cost ratio of NORMA Group results from the ratio of material expenses to sales.

Net debt

Net debt is the sum of financial liabilities less cash and cash equivalents. Financial liabilities also include liabilities from derivative financial instruments that are held for trading purposes or as hedging instruments.

Net operating cash flow

Net operating cash flow is calculated on the basis of EBITDA plus changes in working capital less investments from operating activities. Net operating cash flow is a key financial control figure for NORMA Group and serves as a measure for the Group’s liquidity.

NORMA Value Added (Nova)

A key financial control figure for NORMA Group that serves as a measure for the annual rise in corporate value.

OHSAS 18001

Occupational Health and Safety Assessment Series; certification of occupational health and safety management systems.

Original equipment manufacturer (OEM)

A company that retails products under its own name.

Peugeot Société Anonyme PSA

A French car manufacturer group that includes the Citroen, DS, Opel, Peugeot and Vauxhall brands.

Prime standard

A segment of the regulated stock market with higher inclusion requirements than the General Standard. It is the private law segment of the Frankfurt Stock Exchange with the highest transparency standards. All companies listed in the DAX, MDAX, TecDAX and SDAX must be included in the Prime Standard.

Reverse factoring

A financing solution initiated by the ordering party in order to help its suppliers finance their receivables more easily and at a lower interest rate than they would normally be offered.

Roadshow

Series of corporate presentations made to investors by an issuer at various financial locations to attract investment in the company.

Science-based targets initiative

Initiative that sets climate targets that support the Paris Climate Agreement and meet the goal of limiting global warming to well below two degrees Celsius.

Scope 1, 2, 3

Method for differentiating greenhouse gases. Scope 1: Emissions from emission sources within the company’s boundaries. Scope 2: Emissions from the generation of energy procured from outside the boundaries (especially electricity and heat). Scope 3: All other emissions caused by the company’s activities but not under its control, for example from suppliers, service providers or employees.

Securities ID number (WKN)

A six-character combination of numbers and letters used in Germany to identify securities.

Selective catalytic reduction (SCR)

Selective catalytic reduction is a method used to reduce particle and nitric oxide emissions.

SMED (Single Minute Exchange of Die)

Optimization of set up times of processes through both organizational and technical measures.

Societas europaea (SE)

Legal form for stock companies in the European Union and the European Economic Area. With the SE, the EU started allowing for companies to be founded in accordance with a largely uniform legal framework at the end of 2004.

Stakeholder approach

The stakeholder approach is an extension of the shareholder value approach often found in business management. However, the stakeholder approach attempts to grasp the company in its entire context and to reconcile the needs of different groups. In addition to shareholders, stakeholders include employees, customers, suppliers and the general public.

Standardized Joining Technology (SJT)

One of NORMA Group’s two distribution channels with a wide range of high-quality, standardized connection products for different application areas and end customers. This distribution channel was known as Distribution Services (DS) until 2019.

Sustainable Development Goals (SDGs)

The Sustainable Development Goals (SDGs) were adopted by the United Nations General Assembly in 2015. They cover economic, environmental and social aspects and consist of individual indicators that make implementation measurable.

Thermoplasts (also known as plastomers)

Plastics that become elastic (thermoplastic) in a particular temperature range, whereby this process is reversible.

UN Global Compact

United Nations initiative for corporate responsibility.

Weighted average cost of capital (WACC)

The weighted average cost of capital (WACC) represents a company’s total costs of capital for liabilities and equity depending on the individual capital structure.

Working capital

Trade working capital describes the Group’s current net operating assets and is calculated as the sum of inventories and trade receivables minus trade payables.

Xetra

An electronic trading system operated by Deutsche Börse AG for the spot market.