# Risk Register — Q1 2026 Update

**From:** Élise Moreau, Chief Risk Officer
**To:** Board of Directors, Helios Renewables AG
**Date:** 13 March 2026
**Classification:** Board-confidential

## Heat-map at a glance

| # | Risk | Q4 2025 | Q1 2026 | Δ |
|---|---|---|---|---|
| R-01 | Supply-chain concentration (cathode precursor) | Amber | **Red** | ↑ |
| R-02 | Module-price compression | Amber | Amber | → |
| R-03 | EU CBAM tariff exposure | Amber | Amber | → |
| R-04 | Storage-pipeline conversion | Green | Green | → |
| R-05 | Cyber / IT incident | Amber | Amber | → |
| R-06 | Key-person risk (storage engineering) | Green | Amber | ↑ |
| R-07 | Regulatory — DE/AT permitting | Amber | Amber | → |
| R-08 | FX (USD cathode purchases) | Green | Green | → |
| R-09 | M&A execution (Solarcraft) | n/a | Amber | new |
| R-10 | ESG / climate-transition reporting | Green | Green | → |

## R-01: Supply-chain concentration — elevated to red

**Status:** Red. **Owner:** CRO + Head of Procurement. **Mitigation deadline:** 30 June 2026.

Two of our three battery-cell suppliers (Suppliers B and C) source **>70 % of cathode precursor (NCM 622 powder) from a single Chinese producer (HuaJin Materials, Jiangsu)**. Supplier A, which we treated as the redundancy in our 2024 risk paper, has since shifted to the same producer for cost reasons. We are now **effectively single-sourced** at the precursor level for ~85 % of our cell purchases.

The risk crystallised because of three concurrent changes between October 2025 and February 2026:

- EU CBAM widening (December 2025) increased the landed cost of imported cells, putting Western precursor producers in scope for re-evaluation but on a 12–18 month timeline.
- A geopolitical incident involving the Taiwan Strait in late January caused HuaJin to invoke force-majeure language on a six-week delivery window (resolved without impact, but the option was used).
- One Korean precursor producer (LG Chem subsidiary) exited the NCM 622 line in late February, narrowing the alternative supplier pool from four to three.

### Recommended mitigation (this paper, for ack)

| Action | Owner | Window | Cost |
|---|---|---|---|
| Pre-buy 4 months of cathode (~480 t) at current prices | Procurement | by 30 April 2026 | €22 m working-capital build |
| Accelerate Kintron framework agreement (move signing from Q3 → Q2) | CSO + Procurement | by 30 June 2026 | included in capex envelope |
| Qualify a second non-Chinese precursor producer (Tomson Materials, US) | Engineering + Procurement | by 31 December 2026 | €1.4 m qualification cost |
| Increase contractual price-volatility caps from ±8 % to ±15 % on renewals | Procurement | rolling | none direct |

The CFO has signed off on the working-capital impact (see `03-cfo-q1-financials.md` §6). The board is asked to **acknowledge** the escalation and the mitigation plan; no formal vote is required.

## R-06: Key-person risk — escalated to amber

The Q1 retention survey identified two senior storage-systems engineers as high voluntary-attrition risk. One has been approached by a Series-B competitor; the other is being considered for a role at one of our own customers (E.ON). HR is finalising retention packages (target completion: 4 April 2026). This is not yet at red because succession depth on both roles is acceptable in the medium term.

## R-09: M&A execution risk — new entry

In conjunction with the Solarcraft proposal (`05-acquisition-proposal.md`), the risk register opens a new line covering deal-execution risk: BKartA clearance delay, key-person attrition during the announcement → closing window, customer churn, and integration cost overrun. Initial assessment: amber. Mitigation plan owned by the integration lead (TBC at signing).

## Risks we are not raising

For completeness, three risks were assessed and deliberately *not* raised this quarter:

- **Customer concentration**: top-3 customers are 31 % of revenue, well within our 40 % policy threshold. The Solarcraft acquisition does push pro-forma top-3 concentration to 38 % — still within threshold but worth a re-look in Q3.
- **Liquidity / refinancing**: 2027 maturity is small (€45 m). RCF utilisation low. No action.
- **Climate physical risk to the Antwerp plant**: re-assessed in November 2024; next review November 2026 in line with our biennial cadence.