Leifheit AG

Investor Presentation • Aug 13, 2019

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.

Agenda

• Introduction to Leifheit
• Financial Figures 6M 2019
• Key strategic initiatives
• Forecast Financial Year 2019
• Investment Highlights

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Introduction to Leifheit

Introduction to Leifheit

Tradition – Innovation – Vision

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1959

"We are your leading experts for solutions that make your everyday life at home more easy and convenient"

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Leifheit Group

Household	Wellbeing	Private Label

• High-quality branded products with a high degree of consumer benefit, mid to upper price segment
• Consistent brand management
• Systematic processes for innovation and market launch
• Distribution in international markets
• Products in mid-price range
• Customer-specific product development
• Strong service component

Introduction to Leifheit

One of the leading suppliers of household products in Europe

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Laundry care

43 % Turnover share

Laundry dryers, ironing boards and storage for fresh, clean and well-kept laundry

Kitchen goods

15 % Turnover share

Useful kitchen aids for opening, cooking, cutting or storing

Wellbeing

8 % Turnover share

Scales, medical products and air treatment: complementary new assortments for a modern lifestyle

Experienced Management Board

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Henner Rinsche CEO born 1970

Ivo Huhmann CFO born 1969

Igor Iraeta Munduate COO born 1974

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

Previous experience

• Many years of management experience at C-Level
• Various global financial management functions at Stiebel Eltron and General Electric

Core competencies

• Digitalization, IT, cost productivity, strategic growth models, M&A and Post-Merger Integration

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

Present in leading distribution channels

Introduction to Leifheit

Operating in more than 80 countries with 15 own branches

Financial Figures First half 2019

Good start in Q1 was followed by a restrained second quarter

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		6M 2018	6M 2019	∆
Group Turnover	€ m	121.5	121.5	--
Gross margin	%	44.0	42.8	-1.2 pps
Foreign currency result	€ m	0.1	0.2	>100 %
EBIT	€ m	6.8	5.0	-25.9 %
EBIT margin	%	5.6	4.1	-1.5 pps
Earnings before taxes (EBT)	€ m	6.2	4.3	-30.6 %
Net result for the period	€ m	4.4	3.0	-31.5 %
EPS	€	0.46	0.32	-30.4 %

• EBIT decrease primarily due to the lower gross profit.

• Gross margin decrease due to negative customer and product mix effects.

Group turnover on par with previous year

Financial Figures first half 2019

15 % growth in TV-advertising test market Eastern Europe

Free Cash Flow improved, still too much impacted by working capital

in € m	6M 20182	6M 2019	∆
Cash flow from operating activities	3.0	6.0	3.0
Cash flow from investment activities	13.1	-2.7	-15.8
Cash flow from financing activities	-10.0	-10.3	-0.3
Change in cash and cash equivalents	6.0	-7.0	-13.0
Cash and Cash equivalents at the end of reporting period	34.3	43.9	9.6
Free cash flow1	1.0	3.3	2.3

in € m	31.12.2018	30.06.2019	∆
Cash and Cash equivalents at the end of reporting period	50.9	43.9	-7.0
Group liquidity	50.9	43.9	-7.0

• Decline in Group liquidity mainly from dividend payment in the amount of m€ 10.0.
• 1 Sum of cash flow from operating activities and investment activities adjusted for financial assets.
• 2 IFRS 16 applied for the first time on 1 January 2019, using the modified retrospective method, previous year figures not adjusted.

Solid finance structure of the Group

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Balance sheet ratios

1 IFRS 16 applied for the first time on 1 January 2019, using the modified retrospective method, previous year figures not adjusted.

Investor presentation August 2019

Average number of employees declined by workload-related fluctuations at Czech plant

Key strategic initiatives 2019

Strengthening strategy to consistently address growth themes

Internationalization: Increased investments in Eastern Europe

• European markets with attractive growth opportunities
• Increased marketing spending in Eastern Europe

Key strategic initiatives

Increased marketing investments in Eastern Europe led to significant growth rates

Germany

Growth rates vs. Consumer Marketing spending in relation to turnover

Eastern Europe

Growth rates vs. Consumer Marketing spending in relation to turnover

* Growth rate 2018 adjusted by contract production at our Czech production facility expired in 2017.

-10%

-5%

0%

5%

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Roll-out Eastern Europe strategy to Germany and other core markets

• forced to forgo necessary price increases,
• led to pressure on gross margins.
• Implementation of the successfully tested Eastern Europe marketing strategy to raise consumer demand through targeted advertising campaigns in Germany and other core markets for selected products
• Initial test on a small scale before upscaling successful advertising campaigns
  • e.g. for test-winning Leifheit Clean-Twist System in NL

00

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Forecast Financial Year 2019

Financial Forecast

2019: Turnover growth of roughly 3% and EBIT of around m€ 9 to 10 expected

Economic environment 2019	Slowdown in growth due to increasing global and economic tensions ► Economic slowdown in the EU despite good domestic demand ► Retail trade growth in Germany weak ► European consumers' propensity to consume worsens ►
Forecast Group	Group: ►	Turnover growth of about 3 % (prev. 3 to 4 %)
development	Household:	Turnover growth of about 3 % (prev. 2 to 3 %)
2019	Wellbeing:	Turnover growth of about 7 to 8 % (prev. 11 to 12 %)
	Private Label:	Turnover roughly on par with previous year (prev. growth of about 3 to 4 %
	EBIT of around € 9 m to € 10 ►
	Free cash flow of about € ►	3.5 m to € 4.5 m

Investment Highlights

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