1. Letter of engagement of the President

1. Letter of engagment of the President

Another difficult pandemic year is over and we've once again adapted to ongoing changes with a positive attitude and a lot of hard work from the entire Irizar team. Tight restrictions on public transport, and transport in general, to mitigate the spread of the virus kept having a strong negative impact on the sector. And in 2021, only domestically, bus transport lost more than 1 billion travellers in regards to 2019. It's a complex management situation that has demanded balancing short-term needs (protecting people's health and safety) with medium and long-term needs like ensuring the sustainability of the business and creating value for our stakeholders.

Our convictions are clear. These uncertain times have not stopped us. On the contrary, they've driven us to make progress towards competitive sustainability. We know sustainability is the strongest force for change in our generation. It will transform the way we live and work. It will create new sources of value and extraordinary growth and it will be present in everything we do. Since we started manufacturing our first animal powered carts 133 years ago, in addition to continuously evolving, Irizar has gone through several strategic transformations.

Now, once again we're reinventing Irizar to focus on smart and sustainable mobility through innovating our business, product and services.

We don't have the slightest doubt about the future of collective public transport as a fundamental solution for achieving sustainability, because a bus can transport the same number of people as 50 cars.

We stayed very close to our clients in 2021, giving them necessary support. We also took the opportunity to take up alternatives for reducing emissions with clients, public institutions and associations of bus and coach manufacturers. We've also gone back to participating in international fairs.

We're proud of the strength shown by all the people who make up Irizar, who have behaved in a flexible and resilient way. Our goal is to continue being an attractive company for talent - to generate quality jobs. All of that happens with a company culture and behaviour with integrity that is governed by ethical principles in relationships both internally and with stakeholders.

The best evidence of our real commitment to sustainable competitiveness, which is coherent with our mission, is having maintained our employment levels even faced with great difficulties with steep falls in sales for the Irizar Group. During the 2009 economic crisis and the 2020 and 2021 crisis we've protected the jobs of the people who make up the Irizar Group. We understand that economic development and job creation are fundamental in our commitment to sustainability, even in the greatest difficulties.

The best forecasts for 2022 in regards to the two previous years suggest cautious optimism. The strain of the pandemic alongside the armed conflict in Ukraine and subsequent increase in the cost of materials and disruptions in supply and production chains means we have to navigate a VUCA environment (volatile, uncertain, complex and ambiguous) and move with caution towards normalising sustainable mobility. At Irizar we're optimistic and prepared to get back on track for growth, always providing the maximum added values with the right technology, the value of a solid brand, agility and adaptability, closeness to clients, collaboration with suppliers and strategic alliances and incredible committed people in the Irizar family. We are convinced that our sustainable action inspires confidence in both leaders and stakeholders and generates a competitive advantage in times of change and uncertainty and, at the same time, allows us to address the economic, social and environmental challenges faced by Humanity and the Planet. The chance to make a true impact on a company like ours and reinvent ourselves and promote fulfilment of the ten principles of the Global Compact and Sustainable Development Goals of the United Nations is immense in the three aspects of sustainability: Economic-governance, social and environmental.

To those ends, one more year, we're reaffirming our firm commitment to the 10 principles of the United Nations Global Compact (regarding human rights, labour standards, the environment and the fight against corruption), because it helps us with HOW to progress with responsible behaviour. We likewise reaffirm our commitment to keep increasing our contribution to the 2030 Agenda and, especially, the 7 Sustainable Development Goals that we have prioritised, because they're not extras, they are our business. The SDGs are the reference framework for focusing WHAT to do in our transformation to become a global actor in urban and medium and long distance sustainable mobility. To those ends we continue to integrate sustainability into our strategic plans as an indispensable value for the future. At the same time, we keep seeking innovative solutions with a high technological content that will let our clients, who without a doubt guide the goals we set for ourselves, operate their services more efficiently and sustainably.

For all those reasons, but also because it's the right thing to do, at Irizar we're making sustainability one of our highest priorities. I invite you to read more deeply about how we're turning our convictions into a reality. The primary initiatives and progress in the sustainability activities we've been undertaking with our stakeholders are presented transparently below. Thanks to everyone who make it possible!

Koldo Mendizabal, President of Irizar