Leifheit AG

Investor Presentation • Aug 13, 2020

Investor Presentation H1 2020

Henner Rinsche (CEO/CFO) Marco Keul (Vice President Finance)

13 August 2020

Disclaimer

This presentation contains forward looking statements which are based on the management's current estimates with regard to future developments. Such statements are subject to risks and uncertainties which are beyond Leifheit's ability to control or estimate precisely, such as statements on the future market environment and economic conditions, the behavior of other market participants and government measures.

If one of these uncertain or unforeseeable factors occurs or the assumptions on which these statements are based prove inaccurate, actual results could differ materially from the results cited explicitly or contained implicitly in these statements. Leifheit neither intends to, nor does it accept any specific obligation to update forward-looking statements to reflect events or developments after the date of this presentation.

Leifheit AG shall not assume any warranty for the information provided in this presentation being up-todate, accurate, complete or of good quality or for the suitability of the information for specific purposes.

Any liability of Leifheit AG for loss caused by the use or non-use of the information provided or by wrong or incomplete information is excluded.

Welcome to the conference call

Henner Rinsche CEO + CFO

Marco Keul Vice President Finance

Agenda

• Executive Summary
• Introduction to Leifheit
• Key Strategic Initiatives
• Financial Figures 6M 2020
• Forecast Financial Year 2020
• Annex

Strong Group turnover and earnings growth in first half of 2020 despite COVID-19 pandemic

• Very positive business development in the first half-year confirms new scaling-up success strategy
• Leifheit Group well positioned in times of COVID-19 pandemic
• Rising sales in May and June across all channels after shutdown in March and April
• High quality products help consumers keep their homes hygienically clean and remain in high demand by consumers
• Measures taken to ensure stability in supply chain and to secure production and logistics processes pay off, especially for e-commerce
• Advertising campaigns to continue in H2 2020
• Further TV campaigns for top Leifheit products in cleaning and laundry care
• Soehnle print campaign starts in September
• Significant turnover and earnings growth expected for the financial year 2020: growth of Group turnover between 7% and 9% and Group EBIT of between EUR 12 million and EUR 15 million

Management Summary

COVID-19 pandemic strongly affected turnover development in March and April

Group turnover development by months

in %

• TV advertising led to a good start the first two months of 2020
• COVID-19 pandemic resulted in retail shutdowns in March and April
• Rising turnover in May and June across all channels after end of shutdown

Management Summary

Key financial highlights: increased turnover and EBIT despite COVID-19

Introduction to Leifheit

Introduction to Leifheit

Solid base to build on

Strong products and brands

Strong financial structure in € m

Investor Presentation H1 2020 8

Strong long-term stock performance

Investor Presentation H1 2020 August 2020 9

Cleaning 35%

Turnover by product category

6M 2020

41%

Central Europe 43%

Turnover by region

6M 2020

Europe 13%

Introduction to Leifheit

Leifheit Group

Standing Dryers

Introduction to Leifheit

Fortunately hypers & discounters stayed open during Covid-19 retail shut-downs

Hypermarkets 29 (30) DIY 17 (16) E-Commerce 16 (15) Retail-/Whole sale, Department stores 11 (12) Importers/ Exporters 8 (8) Discounter 8 (8) Cash & Carry 3 (3) Electro 3 (3) Others 5 (5) Top 10 Customers account for 50% of Leifheit's turnover Blue Chip client base Distribution channels Turnover in % (previous year's figures) Turnover 2019: € 234.0 m

Operating in more than 80 countries with 15 own branches

Our purpose? Happy consumers!

Urgent need for change

Can we change it? Yes we can!

Scaling up success strategy

Create consumer demand and make brand stronger 1

1 Source: Annual reports 2019

Investor Presentation H1 2020 August 2020 18

Successful TV campaigns boost turnover growth in the relevant markets in H1 2020 1

Turnover development selected TV markets

Group turnover 6M 2020 in € m

¹ Creating and pre-testing effective ads

• Further TV campaigns in Germany and selected European markets in H2.
• Draw consumer attention to top products such as the CLEAN TWIST set or the Pegasus drying rack, which were tested and awarded a "very good" grade.
• Major part of marketing investments are incurred in the third quarter.

¹ Creating and pre-testing effective ads

Large-scale Soehnle print campaign

• Campaign focuses on Soehnle Page Profi 300 digital kitchen scales, recently awarded a "very good" test result.
• Soehnle Page Profi is the most-popular range of kitchen scales in Germany.
• Target group-relevant and high-reach top print titles from September to December 2020: 8 million copies, 2.74 million target group contacts.

² Increase distribution

Turnover development Italy

Household and Wellbeing in € m

Improve gross margin 3

	Make in Europe	Buy in Asia
margin1 Average contribution	~42%	~34%

1 Household and Wellbeing segments

Investor Presentation H1 2020 August 2020 23

Boost profitability rockets

	Product A	Product B	Product C	Product D…
Contribution margin	medium	medium	medium	…
Level of distribution	medium	medium	medium	…
Quality and consumer satisfaction				…
	Boost consumer marketing

High consumer satisfaction with Leifheit top products 3

5 Sterne	84%
4 Sterne	9%
3 Sterne	3%
2 Sterne	1%
1 Stern	2%

5 Sterne	76%
4 Sterne	13%
3 Sterne	4%
2 Sterne	2%
1 Stern

Linomatic 500 Deluxe 4.5 stars

Sterne	77%
Sterne	11%
Sterne	5%
Sterne	2%
Stern	6%

Reduce all cost except consumer advertising 4

% of Group turnover	FY 2018	FY 2019	H1 2019	H1 2020	Change
Consumer marketing	0.7%	1.7%	1.3%	3.8%	✓ +2.5pp
Other marketing	5.4%	4.6%	4.7%	3,5%	✓ -1.2pp
R&D	2.3%	2.4%	2.4%	2.0%	✓ -0.4pp
1 Logistics	11.0%	11.5%	11.1%	10.0%	✓ -1.1pp
Administration	6.1%	6.4%	6.7%	6.5%	✓ -0.2pp
Cost of turnover	56.4%	56.8%	57.2%	55.9%	✓ -1.4pp
OPEX 2 adj. by Consumer marketing	94.2%	94.7%	94.9%	89.9%	✓ -5.0pp
OPEX 2	94.9%	96.4%	96.3%	93.7%	✓ -2.6pp

1 not including inbound cost 2 without other operating income/expenses

Reduce all cost except consumer advertising 4

Continuously working on an Excellence Programme to reduce complexity and costs:

• Operational excellence
• Projects to reduce Logistic costs
• Streamlining portfolio and substantial SKU reduction
• Lean manufacturing initiatives and ratio projects to improve efficiency of our production sites
• Savings from purchasing of raw materials
• Cost savings by digitalisation, meeting efficiency, travel expenses etc.
• Structural excellence
• Board of Management reduced from 3 to 2
• Sales structure in Germany has been streamlined
• New innovation strategy has led to headcount reduction in R&D
• Leaving employees will usually not be replaced

Financial Figures 6M 2020

Strong growth in Household and Wellbeing segments

to the first half of 2019 due to strict COVID-19 restrictions in France.

Successful TV-advertising campaigns result in increased demand

Group turnover by region

• Slight decrease by 1.3% in Germany due to temporary closures of important distribution channels as a result of COVID-19 restrictions.
• Central Europe with significant growth of 16.0%. Especially in the Netherlands and Switzerland Leifheit was able to further widen its distribution network.
• Eastern Europe with turnover increase of 7.5% due to increased consumer marketing investments. Particularly strong growth in Romania and Poland.

Increased turnover and EBIT despite COVID-19

		6M 2019	6M 2020	∆
Group turnover	€ m	121.5	130.4	7.3 %
Gross margin	%	42.8	44.1	1.3 pps
EBIT adjusted for foreign currency result	€ m	4.8	8.9	85.6 %
Foreign currency result	€ m	0.2	-0.1	>- 100 %
EBIT	€ m	5.0	8.8	75.7 %
EBIT margin	%	4.1	6.8	2.7 pps
Earnings before taxes (EBT)	€ m	4.3	8.3	91.8 %
Net result for the period	€ m	3.0	6.0	> 100 %
EPS	€	0.32	0.63	96.9 %

Negative cash flow mainly due to turnoverrelated increase in receivables

in € m	6M 2019	6M 2020	∆
Cash flow from operating activities	6.0	-0.2	-6.2
Cash flow from investment activities	-2.7	-2.4	0.3
Cash flow from financing activities	-10.3	-0.4	9.9
Change in cash and cash equivalents	-7.1	-2.9	4.2
Cash and cash equivalents at the end of reporting period	43.9	47.4	3.5
Free cash flow1	3.3	-2.5	-5.8

in € m	31/12/2019	30/06/2020	∆
Cash and cash equivalents at the end of reporting period	50.3	47.4	-2.9
Group liquidity	50.3	47.4	-2.9
Financial liabilities	-	-	-

• Decrease in Group liquidity mainly results from the strong rise in working capital; short-term trade receivables up by € 13.2 m to € 57.6 m and inventories increased by € 7.8 m to € 53.6 m on the reporting date
• At € 2.4 m investments under previous year (€ 2.8 m)

¹ Cash flow from operating activities and from investment activities, adjusted for incoming and outgoing payments in financial assets and, if existing, from the divestiture of business divisions.

Financial figures 6M 2020

Group liquidity affected by growth-related increase in receivables and inventories

Group liquidity

• Increase in trade receivables as a result of turnover growth (H1 2019: decrease € 0.7 m)
• No noteworthy effects from aging of receivables in connection with COVID-19
• Increase in inventories, due to consumer advertising planned for the third quarter and to the stocking-up of raw materials

1 Others contains sales and income taxes in the amount of € 4.3 m

Forecast Financial Year 2020

Economic recovery after shutdown: optimistic outlook for the remainder of 2020

Economic environment 2020	• IMF: Global economy faces worst economic downturn since 1930s depression with more gradual recovery than previously anticipated. • European commission: EU economy will experience a deep and uneven recession with expected recovery in 2021. • Economic barometer of the German Institute for Economic Research (DIW) recovered significantly in July and went from the historic low of 2 points in June to a solid 90 points. • GFK: Steady recovery of consumer climate in Germany after lifting COVID-19 lockdown.
Forecast Group development 2020	• Expected Group turnover growth of between 7% and 9% • Expected turnover growth by segment: Household 8.5% to 10.5%, Wellbeing 11% to 13%, Private Label slight decrease • Group EBIT of between € 12 m and € 15 m • EPS of between approx. € 0.83 and € 1.05 • Free cash flow of approx. € 1 to € 3 m , ROCE between 9% to 12% • Forecast based on assumption that there will be no further significant restrictions due to COVID-19 pandemic in relevant markets and channels.

YOUR QUESTIONS PLEASE.

13 August 2020

Long-term financial overview

		2015	2016	2017	2018	2019
Group turnover	€ m	231.8	237.1	236.8	234.2	234.0
Profitability
▪ Gross margin	%	46.7	47.5	46.4	43.6	43.1
▪ Cash flow from operating activities	€ m	20.8	21.8	7.2	10.2	15.9
▪ Free cash flow	€ m	14.1	14.3	1.5	3.7	10.1
▪ EBIT EBIT adjusted1 ▪	€ m € m	21.7 19.2	22.1 21.8	18.8 20.3	13.1 12.8	9.9 9.6
▪ EBIT margin	%	9.3	9.3	8.0	5.6	4.2
▪ EBT	€ m	20.2	20.6	17.7	11.9	8.5
▪ Net result for the period	€ m	14.3	14.5	12.9	8.4	5.8
▪ ROCE	-1 %	18.1	16.3	12.7	8.5	7.0

1 Adjusted by foreign currency results

Long-term financial overview

		2015	2016	2017	2018	2019
Per share1
Net result for the period2	€	1.51	1.53	1.35	0.88	0.61
Free cash flow	€	1.48	1.51	0.16	0.39	1.06
Dividend3	€	1.00	1.05	1.05	1.05	0.55
Special dividend	€	0.38	0.40	--	--	--
Investments	€ m	7.1	7.8	7.8	6.6	6.0
Depreciation	€ m	5.8	6.2	6.4	6.9	8.2
		31/12/15	31/12/16	31/12/17	31/12/18	31/12/19
Employees	No.	1,074	1,093	1,137	1,119	1,106
Balance sheet total2	€ m	237.9	239.4	224.9	221.8	214.6
Equity	€ m	106.7	104.6	98.5	101.8	96.2
Equity ratio	%	44.9	43.7	43.8	45.9	44.8
Liquidity	€ m	68.2	69.5	57.2	50.9	50.3

1 Scrip issue in June 2017, 2013 – 2016 adjusted

2 Not including repurchased treasury shares

3 2019: Proposal to the Annual General Meeting

Experienced Management

Henner Rinsche CEO + CFO

Previous experience

• President Europe at SodaStream
• Various leading positions at Henkel, Danone, PepsiCo and Procter & Gamble

Core competencies

• General management, business development and consumer goods marketing

Igor Iraeta Munduate COO

Previous experience

• Many years of experience as CTO at Igus GmbH and Stoba Präzisionstechnik
• Various technical management positions at Robert Bosch GmbH

Core competencies

• Digitalization, IoT, Industry 4.0, implementation of lean production systems, agile "Scrum" methods

Marco Keul Vice President Finance

Previous experience

• Responsible for Finance, Controlling, IT/Business processes and internal Sales services as of 01 April 2020
• 2012 2020 Head of Controlling at Leifheit AG

Core competencies

• IT, Finance & Controlling

Committed to shareholder returns

	Long-term dividend development	Dividend yield 1
	Dividend per share / in €	2019: 2.3% 2015: 5.6% 2018: 5.9% 2014: 3.9% 2017: 3.8% 2013: 5.3% 2016: 5.1% 2012: 5.2%
1,50 1,00	Proposal to the Annual General Meeting for	2019: 0.55 €
0,50
0,00	4 5 6 7 8 9 0 2 3 4 5 6 7 8 9 0 91 8 8 8 8 8 8 9 9 9 9 9 9 9 9 9 0 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 0 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1	2 3 4 5 6 7 8 9 0 2 3 4 5 6 7 8 9 01 1 0 0 0 0 0 0 0 0 01 01 01 01 01 01 01 01 01 01 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
	Bonus/special dividend	Dividend

1 Based on the particular closing price at year-end, 2019: proposal to Annual General Meeting

Soehnle awards (selection)

Body analysis scales Shape Sense Connect 100 + 200 Blood pressure monitors Systo Monitor 200 + 300 Luftreiniger AirFresh Clean 300 and Clean Connect 500

Leifheit – more than 60 years of passion for housework

• New Strategy "Scaling up Success"

European competitors by category

	Cleaning					Laundry care
Tonkita	Spontex	Swiffer		Rival	Vileda Wenko	Gimi	Brabantia	Juwel	Artweger Stewi
	Kärcher		Vileda		Metaltex		Rörets		Blome
		Kitchen goods				Wellbeing
Zyliss	Tescoma Oxo	Rösle Fackelmann	WMF	Gefu Lurch	ADE	Bosch	Homedics	Laica	Tanita
Brabantia		Westmark	Emsa	Tefal	Sanitas	Withings		Terraillon	Beurer

Significant free float and international investors

Shareholder structure

Non free float shareholders¹ 25.25% Free float1,2 74.75%

1 Definition of German stock exchange for indices 2 Including shareholdings of the management board

• Joachim Loh, Haiger (GER), 10.31%
• MKV Verwaltungs GmbH, Grünwald (GER), 10.03%
• Leifheit AG Nassau (GER), treasury shares Aktien, 4.91%
• Alantra EQMC Asset Management, SGIIC, SA, Madrid (ES), 10.44%
• Teslin Capital Management BV/Gerlin NV, Maarsbergen (NL), 5.05%
• MainFirst SICAV, Senningerberg (LUX), 5.04%
• Blackmoor Ownership Holdings Master Limited, London (UK), 3.52%
• Voting rights under notification threshold 50.70%

^3.03%

Financial calendar and contact

Dates 2020 Contact

30 Sep 2020

Virtual Annual General Meeting in accordance with the regulations of the C19 AuswBekG.

11 Nov 2020

Quarterly statement for the period ending 30 September 2020

11 Nov 2020 Investor and Analyst Conference Call

16 - 18 Nov 2020

Presentation at German Equity Forum (online) Corporate Communications / Investor Relations

Phone: +49 2604 977-218

Email: ir@leifheit.com

www.leifheit-group.com

Aktiengesellschaft

Postfach 11 65 D-56377 Nassau