Half-year Results

Group Financial Statements

31st October 2024

EXECUTIVE DIRECTORS

Michael Bell

Michael O'Connell

Nicholas Bell

NON-EXECUTIVE DIRECTORS

Roger Lane-Smith

David Hansell

COMPANY SECRETARY

Shelley Ashcroft

REGISTERED OFFICE

Balby Carr Bank

Doncaster

DN4 8DH

England

PRINCIPAL OPERATING DIVISIONS

'Defence and Security'

'Forgings'

'Petrol Station Superstructures'

'Corporate Branding'

Chairman's Statement

Introduction In my recent Chairman's Statements, I have highlighted the considerable progress we have achieved over the last few years. In the three years to April 2024 revenue increased by over 75 percent from £61.54m to £109.58m and pre-tax profits expanded almost ten-fold from £1.59m to £15.71m. Today, I am pleased to report that the good progress continues and I remain even more optimistic about our ongoing performance and prospects than I was at this time last year. The step change in the development of our 'Defence and Security' businesses has enabled us to engage in substantially larger international contracts, around the world, that extend over much longer periods and often involve phased delivery. 'Revenue is recognised as performance obligations are satisfied, which is when control of goods and services has transferred to the customer.' ( Source: Accounting Policies page 35 MSI Annual Report 2024 ). As a result of winning these larger contracts, a substantial amount of ongoing work in the first half will not be recognised as revenue until either later this year or in following years, when the goods and services have transferred to the customer. Timing of revenue will, therefore, be an increasingly significant feature going forward and, indeed, it has impacted the results for the first half. Nevertheless, the Company is making remarkable advances, even if the half year results do not fully reflect this. Results For the half year ended 31st October 2024, profit before tax amounted to £8.77m (2023 - £7.72m) on revenue of £54.72m (2023 - £57.02m). Basic earnings per share were 39.8p (2023 - 35.9p). The balance sheet remains strong with cash and cash equivalents of £32.02m (2023 - £50.05m). Review of Divisions 'Defence and Security' This division enjoyed another period of good progress as our excellent international reputation as a top-quality designer and producer of naval weapon systems continues to grow. The company is now attaining a similar reputation in the much larger international land-based equipment section of the defence market. Our truck/trailer-based version of the MSI Paladin VSHORAD gun systems are now being utilised to protect strategic assets against the threats posed by Uncrewed Aircraft Systems. These product developments, together with our significant presence and exposure at major international defence equipment exhibitions, auger extremely well for the future performance of the division. The significant upgrading and development of our production and administrative facilities at our key Norwich site should be completed within weeks. This positions us well to support our anticipated future levels of business. The US operation continues to prosper with deliveries of gun systems from Norwich for ship fits in the US, for both the US Navy and US Foreign Military Sales projects. Concurrently we are developing and expanding the management and service support team, to ensure that we have the structure in place to support the predicted US ship fits. We are also making provision at our existing, substantial and contemporary property in Rock Hill, South Carolina, to accommodate our projected growth. 'Forgings' Despite reduced global demand for forks, we have not only maintained market share but believe that we can make significant inroads into the market, particularly in the United States. We continue to make improvements in efficiencies and costs to maintain our competitiveness in this mature but important industry. 'Petrol Station Superstructures' The strong performance demonstrated by the UK operations in the last financial year has continued. Activity remains at a high level for both new construction and ongoing station maintenance, resulting in an impressive order book. Customer demand for modern replacement forecourt structures continues for both existing service stations and new large, multifuel developments on motorways and major trunk roads. Several high quality projects encompassing multifuel and catering services were completed in the half year. As market leader, we are well positioned to benefit from the many exciting prospects that contemporary forecourt designs present, especially with our unique database of existing petrol station construction drawings and specifications. By comparison, our Poland-based business (which serves Eastern and Northern European countries) has experienced a challenging time owing to an understandable serious lack of investment by the oil companies in maintaining and developing their businesses in that, currently, highly politically sensitive region. There are, however, positive signs of a revival in the construction of canopies for electric car charging stations in Western Mainland Europe. ' Corporate Branding' The UK operation has very pleasingly continued to prosper, whilst our Netherlands/Germany business restructures to meet subdued market conditions in the petroleum business sector. Notwithstanding, it is satisfying to report that there has been a notable recent upturn in activity for our long, and well established, international 'way-finding' equipment installation and maintenance service business at international airports. Furthermore, we are also seeing some new and positive prospects arising from our offerings in the automotive sales sector of the branding market. Outlook I am most encouraged with the considerable progress that we continue to make across all the divisions. This is particularly pleasing in a year of uncertainty, in terms of the political change in many of the countries we serve and, of course, movements in both interest and exchange rates. In my June 2024 statement, I also reported that '…we continue to review and evolve the future strategic priorities for MSI and the profile of the next generation of management'. I also referenced this in my comments at the AGM in July. From 1 st January 2025 the Board will change as follows. I will continue as Executive Chairman and Michael O'Connell, who has been with me for over 40 years, will become Managing Director. Shelley Ashcroft, Michael's former deputy in finance and the Company Secretary, will take over the role as Finance Director on 1st January 2025 and subject to the satisfactory completion of customary regulatory checks is expected to join the Board around the same time. This management transition isn't complete, but these are the very first steps towards designing a Board for the future. Our review of the future strategic priorities of the business is nearly complete and I expect to update shareholders about this before the end of the financial year. This is an exciting time for MS INTERNATIONAL and all matters considered, the Board recommends the payment of an increased interim dividend per share of 5p (2023 - 3p). The dividend is expected to be paid on 17 th January 2025 to those shareholders on the register at the close of business on 20 th December 2024. Michael Bell 5 th December 2024

MS INTERNATIONAL plc

Independent auditor's review report on Interim Financial Information to MS INTERNATIONAL Plc

Conclusion

We have been engaged by MS INTERNATIONAL plc (the 'company') to review the condensed set of financial statements in the half-yearly financial report for the six months ended 31 October 2024 which comprises the Interim condensed consolidated income statement, Interim condensed consolidated statement of comprehensive income, Interim condensed consolidated statement of financial position, Interim consolidated statement of changes in equity, Interim consolidated cash flow statement and Notes to the interim consolidated financial statements. We have read the other information contained in the half-yearly financial report which comprises only the Chairman's statement and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 October 2024 is not prepared, in all material respects, in accordance with UK-adopted International Accounting Standard (IAS) 34, 'Interim Financial Reporting' and the AIM rules for Companies.

Basis for conclusion

We have read the other information contained in the half-yearly financial report which comprises only the Chairman's Statement and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Conclusions relating to going concern

In our evaluation of the directors' conclusions, we considered the inherent risks associated with the group's business model including effects arising from macro-economic uncertainties such as high interest and inflation rates, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the group's financial resources or ability to continue operations over the going concern period.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with UK-adopted International Accounting Standard (IAS) 34, 'Interim Financial Reporting' and the AIM rules for Companies.

Auditor's Responsibilities for the review of the financial information

Use of our report

Grant Thornton UK LLP

Statutory Auditor, Chartered Accountants

Leeds

5 th December 2024

Interim condensed consolidated income statement

The interim condensed consolidated financial statements of the Group for the six months ended 31st October 2024 were authorised for issue in accordance with a resolution of the directors on 5 th December 2024 and signed on their behalf by:

Michael O'Connell

Finance Director

Interim consolidated statement of changes in equity

Adjustments to reconcile profit before taxation to cash generated from operating activates:

Notes to the interim consolidated financial statements

Corporate information

MS INTERNATIONAL plc is a public limited company incorporated and domiciled in England and Wales. The Company's ordinary shares are traded on the Alternative Investment Market (AIM) market of the London Stock Exchange. The principal activities of the Company and its subsidiaries ("the Group") are the design, manufacture, construction, and servicing of a range of engineering products and structures. These activities are grouped into the following divisions:

'Defence and Security' - design, manufacture, and service of defence equipment.

'Forging' - manufacture of fork-arms and open die forgings.

'Petrol Station Superstructures' - design, manufacture, construction, and maintenance of petrol station superstructures.

'Corporate Branding' - design, manufacture, installation, and service of corporate brandings, including media facades, way- finding signage, public illumination, creative lighting solutions, and the complete appearance of petrol station superstructures and forecourts.

Basis of preparation and accounting policies

The consolidated condensed interim financial statements included in this half-yearly financial report have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting". They do not include all the information and disclosures required in annual financial statements, and should therefore be read in conjunction with the Group's Annual Report for the year ended 30th April 2024 and any public announcements made by MS INTERNATIONAL plc during the interim reporting period. The financial statements for the year ended 30th April 2024 have been filed with the Registrar of Companies. The auditor's report on these financial statements was unmodified and did not contain statements under sections 498 (2) or (3) of the Companies Act 2006.

The interim financial information has been reviewed but not audited by the Group's auditor, Grant Thornton UK LLP. The interim financial information does not constitute full financial information within the meaning of section 434 of the Companies Act 2006. The auditor's report is included on pages 4-5.

The accounting policies are consistent with those applied in the financial statements of the Annual Report for year ended 30th April 2024. The Group has not early adopted any standard, interpretation, or amendment that has been issued but is not yet effective.

The assets and liabilities of the overseas subsidiaries are translated into the presentational currency of the Group at the rate of exchange ruling at the statement of financial position date and their income statements are translated at the weighted average exchange rates for the year. The exchange differences arising on the translation are taken directly to a separate component of equity.

Principal risks and uncertainties

The principal risks and uncertainties facing the Group for the remaining six months of the financial year are discussed below. Further details of the Group's risks and uncertainties can be found on page 8 of the Annual Report for the year ended 30th April 2024, which is available from MS INTERNATIONAL plc's website: www.msiplc.com .

One of the Group's principal risks and uncertainties continues to be the impact of inflationary pressures upon both trading and profitability. Rising raw material and energy prices have increased the cost base of all divisions. Where possible cost increases are passed to the customer, however, in doing so there is uncertainty with regards to any potential impact on the level of customer demand.

Given the increasing demand for the Group's products, specifically in the 'Defence and Security' division, increased capacity is required to satisfy customers' requirements. Significant investment in the Norwich facility has taken place, and continues to take place, in order to meet these higher levels of trading. Managing the increase in production capacity comes with both risks and challenges, both internally within the division and externally within the wider supply chain.

The risk that foreign exchange fluctuations will impact the Group's performance has increased significantly over the past year as a number of international contracts in the 'Defence and Security' division are now denominated in USD. This created a large unhedged currency exposure within the Group and as a result, management have taken steps to mitigate this risk by taking out various forward contracts (note 15).

Going concern

The condensed interim financial statements included in this report have been prepared on a going concern basis. Forecasts have been made up to 30th April 2026, which the Directors believe to be a reasonable expectation based on the information available at the time of signing these accounts. The forecasts have been assessed for the impact of potential sensitivities, including a 10% fall in the forecasted Group revenue and a 10% increase in materials prices. In all scenarios, the Group has sufficient headroom to meet its liabilities as they fall due. In addition, management have carried out reverse stress tests to 30th April 2026 under various scenarios, all of which are considered implausible by management. In all tested scenarios, the Group would continue as a going concern for at least the next 12 months. As a result, in making the going concern assessment the Directors believe there to be no material uncertainties that could cast significant doubt on the Group's ability to continue operating as a going concern. The Group has sufficient financial resources with a healthy order book to continue operating for the foreseeable future, being at least to 30th April 2026. As a result, the Directors continue to adopt the going concern basis of accounting in preparation of this report. 5. Revenue The Group's revenue disaggregated by pattern of revenue recognition is as follows: Half-year to 31st October 2024 Half-year to 31st October 2023 unaudited unaudited £'000 £'000 Revenue recognised at a point in time 52,597 55,780 Revenue recognised over time 2,121 1,243 Total revenue 54,718 57,023

Segment information

The following table presents segmental revenue and operating profit/(loss) as well as segmental assets and liabilities of the Group's divisions for the half-year periods ended 31st October 2024 and 31st October 2023. The reporting format is determined by the differences in manufacture and services provided by the divisional segments within the Group.

* Unallocated assets include certain fixed assets (including all UK properties), current assets, and deferred income tax assets. Unallocated liabilities include the defined benefit pension scheme liability, the deferred income tax liability, and certain current liabilities.

Tax expense

The income tax expense is recognised in each interim period based on the best estimate of the weighted average annual income tax rate expected for the full financial year.

The major components of the tax expense in the consolidated income statement are:

Tax relating to items charged to other comprehensive income: Half-year to 31st October 2024 Half-year to 31st October 2023 unaudited unaudited £'000 £'000 Deferred tax on measurement of defined benefit pension scheme - 14 Deferred tax in the Interim condensed consolidated statement of comprehensive income - 14

Earnings per share

The calculation of basic earnings per share of 39.8p (2023 - 35.9p) is based on the profit for the period attributable to equity holders of the parent of £6,446,000 (2023 - £5,802,000) and on a weighted average number of ordinary shares in issue of 16,177,305 (2023 - 16,141,981). At 31st October 2024 there were 820,020 (2023 - 1,072,693) potentially dilutive shares on option with a weighted average effect of 636,234 (2023 - 789,551) giving a diluted earnings per share of 38.3p (2023 - 34.3p).

Half-year to 31st October 2024 Half-year to 31st October 2023 unaudited unaudited Weighted average number of shares in issue 17,841,073 17,841,073 Less weighted average number of shared held in the ESOT (32,093) (231,387) Less weighted average number of shares purchased by the Company (1,631,675) (1,467,705) Weighted average number of shares to be used in basic EPS calculation 16,177,305 16,141,981 Weighted average number of the 820,020 (2023 - 1,072,693) potentially dilutive shares 636,234 789,551 Weighted average diluted shares 16,813,539 16,931,532 Profit for the period attributable to equity holders to the parent in £ 6,446,000 5,802,000 Basic earnings per share 39.8p 35.9p Diluted earnings per share 38.3p 34.3p

Dividends paid and proposed

The interim dividend will be payable on 17th January 2025 to those shareholders on the register at the close of business on 20th December 2024, with the ex-dividend date being 19th December 2024.

Property, plant and equipment

At 31st October 2024 (unaudited)

The last formal valuation of the Group's land and buildings, which consists of manufacturing and office facilities in the UK, the USA and Poland, was carried out in April 2022 by Dove Haigh Phillips (UK), Real Estate & Appraisal Services Inc (USA), and KonSolid-Nieruchomosci (Poland). Management determined that these constitute one class of asset under IFRS 13 (designated as level 3 fair value assets), based on the nature, characteristics and risks of the properties.

The properties in the UK were valued on the basis of an existing use value in accordance with the Appraisal and Valuation Standards (5th Edition) published by the Royal Institution of Chartered Surveyors. The Polish property was valued based on the income approach, converting anticipated future benefits in the form of rental income into present value. The US property was valued on an income and market value basis. For all properties, there is no difference between current use and highest and best use.

Right-of-use assets

At 31st October 2024 (unaudited)

Cash and cash equivalents

For the purpose of the interim consolidated cash flow statement, cash and cash equivalents are comprised of the following:

The restricted cash balance held in Escrow provides security to both Lloyds Bank plc and Barclays Bank plc in respect of certain guarantees, indemnities, and performance bonds given by the Group in the ordinary course of business.

Pension liability

The Company operates an employee pension scheme called the MS INTERNATIONAL plc Retirement and Death Benefits Scheme ("the Scheme"). IAS 19 requires disclosure of certain information about the Scheme as follows: · Until 5th April 1997, the Scheme provided defined benefits and these liabilities remain in respect of service prior to 6th April 1997. From 6th April 1997 until 31st May 2007 the Scheme provided future service benefits on a defined contribution basis. · From 1st June 2007 the Company has operated a defined contribution scheme for its UK employees which is administered by a UK pension provider. Member contributions are paid in line with this Scheme's documentation over the accounting period and the Company has no further obligations once the contributions have been made. · From 6th April 2016 the Company directly pays the expenses of the Scheme. The total pension scheme expenses incurred by the Company during the period were £109,000 (2023 - £221,000). · The last formal valuation of the Scheme was performed at 5th April 2023 by a professionally qualified actuary. Due to improved funding of the Scheme on a Technical Provisions basis, the last quarterly deficit contribution was made in April 2024. The current Schedule of Contributions requires no further deficit reduction payments to be made and therefore no payments have been made during the period (2023 - £675,000). · At 31st October 2024 the present value of the contracted future deficit reduction contributions was £nil (2023 - £3,577,000), which was less than (2023 - more than) the net scheme surplus of £544,000 (2023 - £48,000). As the Company does not have an unconditional right to the economic benefits arising from this surplus, a liability of £nil (2023 - £3,625,000) has been recognised within the financial statements in accordance with IFRIC 14. .

Commitments and contingencies

The Group is contingently liable in respect of guarantees, indemnities and performance bonds given in the ordinary course of business amounting to £4,170,000 at 31st October 2024 (2023 - £7,416,000). The cash held in Escrow of £4,170,000 (2023 - £7,426,000) provides security to both Lloyds Bank plc and Barclays Bank plc in respect of these guarantees, indemnities and performance bonds.

In the opinion of the Directors, no material loss will arise in connection with the above matters.

The Group and certain of its subsidiary undertakings are parties to legal actions and claims which have arisen in the normal course of business. The results of actions and claims cannot be forecast with certainty, but the directors believe that they will be concluded without any material effect on the net assets of the Group. 15. Derivative financial instruments The Group has in place a number of forward currency contracts in respect of USD denominated cash inflows in the 'Defence and Security' division. The Group has chosen not to adopt hedge accounting with respect to forward exchange contracts and as a result the profit arising from the change in the fair value during the period has been included within operating profit. At 31 st October 2024 (unaudited) US Dollar $'000 Sterling £'000 Average forward rate Balance at period end £'000 Non-current derivative asset 10,000 8,052 1.2420 293 Current derivative asset 47,500 38,629 1.2296 1,702 Total 57,500 46,681 1.2318 1,995

At 31 st October 2023 (unaudited) US Dollar $'000 Sterling £'000 Average forward rate Balance at period end £'000 Non-current derivative liability 57,500 46,680 1.2318 (218) Current derivative liability 41,500 33,615 1.2346 (513) Total 99,000 80,295 1.2330 (731) At 30th April 2024 (audited) US Dollar $'000 Sterling £'000 Average forward rate Balance at period end £'000 Non-current derivative asset 20,000 16,134 1.2396 309 Current derivative asset 54,000 43,968 1.2282 898 Total 74,000 60,102 1.2312 1,207 16. Share-based payments During the period, a total of 12,000 share options have been granted to employees under the MS INTERNATIONAL plc Company Share Option Plan. These options are exercisable in three equal amounts at three, four and five years after the date of grant at an exercise price of £9.90 and are not subject to any share price performance conditions. Share options totalling 260,673 have been exercised during the period. This includes 25,000 options exercised under the MS INTERNATIONAL plc Long Term Incentive Plan at an exercise price of £0 per share, and a further 235,673 options exercised under the MS INTERNATIONAL Plc Company Share Option Scheme at an exercise price of £1.41 per share. 175,670 of the options were satisfied by transferring shares from treasury and the remaining 85,003 options were satisfied by transferring shares from The Employee Share Ownership Trust ("ESOT"). The following table illustrate the number and weighted average exercise prices (WAEP) of share options during the year: Long-term Incentive Plan Company Share Option Plan Total Number WAEP Number WAEP Number WAEP Outstanding at 30th April 2023 250,000 - 1,020,000 £1.44 1,270,000 £1.16 Granted in period - - 122,700 £7.16 122,700 £7.16 Exercised in period (100,000) - (220,007) £1.41 (320,007) £0.97 Outstanding at 31st October 2023 150,000 - 922,693 £2.21 1,072,693 £1.90 Granted in period - - - - - - Exercised in period - - (4,000) £1.41 (4,000) £1.41 Outstanding at 30th April 2024 150,000 - 918,693 £2.21 1,068,693 £1.90 Granted in period - - 12,000 £9.90 12,000 £9.90 Exercised in period (25,000) - (235,673) £1.41 (260,673) £1.27 Outstanding at 31st October 2024 125,000 - 695,020 £2.62 820,020 £2.22 The Group recognised a total charge during the period of £36,000 (2023 - £19,000) in relation to equity-settled share-based payment transactions. At 31st October 2024 there were 125,000 (2023 - 150,000) and 207,004 (2023 - 113,337) share options exercisable in the LTIP and CSOP share option schemes respectively.