Sustainability Report 2025

Dear Stakeholders,

The year 2025 unfolded against a global backdrop of profound change and heightened uncertainty. Geopolitical tensions, intensifying competition from Asian markets, and persistent industrial overcapacity are reshaping the international landscape and placing significant pressure on Europe’s manufacturing sector. In this environment, the slowdown in the automotive industry has also had a substantial impact on the steel industry, our primary market, contributing to an overall weakening of demand.

It is in circumstances such as these that the need for companies to evolve becomes most evident – not merely to grow, but to remain relevant.

In recent years, Castellini has embarked on a far-reaching transformation. We have chosen to expand our scale and broaden our capabilities, firmly believing that only a structured approach to growth and evolution can ensure long-term competitiveness and resilience. The acquisition of Lazzari is part of this strategy, enabling us to strengthen our industrial presence, expand our market offering, and create new synergies.

At the same time, the establishment of Castellini Holding marks a fundamental step toward creating a clearer Group structure, implementing more transparent and effective governance, and supporting the development of our companies through shared services.

These changes have not been isolated initiatives, but part of a broader trajectory. Recent years have seen an acceleration in the pace of transformation, changes required both to navigate today’s complex environment and to build robust strategies grounded in a long-term vision.

Today, the role of an entrepreneur increasingly demands the ability to look beyond day-to-day operations, interpret the broader context, and chart a clear course. It is not merely about managing the business, but about guiding the company toward sustainable market positions and lasting results.

Throughout this journey, we have made decisions that were difficult but necessary. Our longstanding core business, represented by the Machining Business Unit, is experiencing a gradual decline in volumes. Growing competition from Asian manufacturers, now technologically comparable and benefiting from significant economies of scale, is making it increasingly difficult to compete in standardized production.

For this reason, we have made a determined commitment to innovation by investing in the Solutions Business Unit. Here, we develop advanced systems and process technologies designed to replace traditional systems with more sophisticated solutions that are more efficient, automated, and digitalized, while delivering a significantly lower environmental impact. The technologies we are developing help improve production performance, reduce energy and resource consumption and emissions, and enhance safety for people and the planet.

We have also recognized the need to expand the activities of our Service Business Unit in response to developments in the European steel market. Europe has a mature installed base that increasingly requires maintenance, modernization, and efficiency upgrades rather than the construction of new plants.

Through revamping and reengineering activities, we help our customers improve the performance of their existing assets, extend their useful life, and promote a more sustainable use of resources. At Castellini, sustainability is not separate from our strategy; it is a natural outcome of it. Technological innovation, efficiency, equipment longevity, and process safety are key drivers through which we create not only economic value, but also environmental and social value.

We recognize that the path we have undertaken requires time, determination, and adaptability. We are equally confident, however, that the decisions we have made will enable us to address the challenges of the coming years from a stronger position.

We thank everyone who contributes to this journey each day: our employees, customers, partners, and all the stakeholders who are sharing in this evolution with us.

Fiorenzo Castellini

Chief Executive Officer