va-Q-tec AG

Investor Presentation • Aug 22, 2017

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General highlights

• H1 2017 revenue at EUR 22.5 million compared to EUR 15.6 million in H1 2016 (+44%)
• EBITDA H1 2017: EUR 4.2 million compared to EUR 2.9 million of adjusted EBITDA in H1 2016 (+45%); pos. EBT of EUR +0.5 million vs. EUR -0.3 million in H1 2016
• Very strong product business and strong service business contribute to growth
• Continued investments to expand container fleet and enhance efficiency of the existing production and logistics infrastructure
• New integrated production site has been acquired; 5 locations in Würzburg to be merged again to one central headquarters
• Founding of subsidiaries in Switzerland and in Japan to expand service business and to extend global reach, CH with focus on fulfilment of boxes, Japan focused on sales
• AGM with broad-based encouragement; all agenda items approved with large majorities; more than 70% of share capital present
• Stefan Döhmen joined as new CFO; as communicated already during IPO, Dr. Roland Caps steps down from Management Board to become Head of Innovation management; Christopher Hoffmann takes responsibilities within the board for intl. expansion

Financial highlights

in EURm	H1 2017	H1 2016	Δ
Revenues	22.5	15.6	+44%
Total Income	26.6	19.8	+34%
EBITDA	4.2	2.9*	+45%
EBITDA margin	16%	15%*
EBT	0.5	-0.3*
Operating Cash flow	0.9	2.1*

A quick view on VQT's AGM, June 2017

*Notes: OPEX and personnel expenses in H1 2016 adjusted for non-recurring items, namely one-off cost associated with the IPO (EUR775k)

Highlights of H1 2017

• Continued strength in Appliances & Food as VIP superinsulation is believed to be at a tipping point due to ever tightening energy labeling standards; VQT regarded as highly reliable
• First deliveries of "va-Q-shell", a quick installation insulation solution for hot water storage

New airline partnership with Emirates Sky Cargo set up

• Planning and set-up process of new manufacturing lines
• Start of Swiss domestic box rental operations in partnership with Swiss Post
• Several negotiation processes for new partnerships with cargo airlines and 3rd party logistics providers in final stage

Key management initiatives in H1 2017

• Planning of new and enhanced capacities in Kölleda to improve efficiency and to meet accelerated customer demand
• New headquarter in Würzburg has been acquired; 5 locations in Würzburg to be merged; substantial efficiency improvement expected, much cheaper and faster then a new building
• Business and partnership development in all Asian regions
• Set-up and planning of significantly strengthened US operations

VQT's new headquarters in Würzburg

Group revenues H1 2017 – Strong growth momentum continues

Notes: Total revenues also include "Other revenues". "Other revenues" primarily comprise state funded R&D

Group revenues H1 2017 – Strong growth momentum continues

Total income & Gross profit

Gross profit

Comments

• Total income growing at lower rate than revenues, as capitalized work and other income grows more slowly than top line
• As in the past, the delta between revenues and total income is a result of
• Capitalization of container and box fleets produced inhouse, and
• Deferred income from special reserves for grants and deferred income from container sale-and-leaseback

Comments

• In H1 2017, solid gross margin at 59%, improved over H1 2016, in line with FY 2016 development
• Good progress on gross margin of container rental business, as cost to serve is managed efficiently across global container network
• Lower gross margin of very strong products business weighs slightly on group gross margin

Adjusted other OPEX

Comments

• Other OPEX (SG&A) cost ratio increases to 16% from 14% in H1 2016 as spending rises, largely in order to drive growth
• Unfavorable USD/EUR development with adverse effect
• Increased spending on rent, IT, marketing & sales, and external consulting
• Significant expenditure for additional rented facilities in Würzburg will decline over time as number of sites is reduced from 5 to 1

*Notes: OPEX and personnel expenses in H1 2016 adjusted for non-recurring items, namely one-off cost associated with the IPO (EUR775k)

Comments

• Good progress on H1 EBITDA with 45% growth over H1 2016
• EBITDA margin of 16%, slightly below the margin of 18% for Q1 2017 as other OPEX has been above expectations in H1 2017
• Primary EBITDA drivers are continued revenue growth, strong gross margin in services, and economies of scale e.g. on

Adjusted group EBIT

Comments

• EBIT has more then doubled YOY, driven by same effects as EBITDA
• Depreciation has increased primarily due to
• Growth of UK-based container fleet in anticipation of strong demand for our container rental services
• Growth of box fleets with shorter depreciation periods

*Notes: OPEX and personnel expenses in H1 2016 adjusted for non-recurring items, namely one-off cost associated with the IPO (EUR775k)

Segment performance

*Notes: OPEX in H1 2016 adjusted for non-recurring items, namely one-off cost associated with the offering (€606k)

in €m	H1 2017	H1 2016
Operating cash flow	0.9	1,5
Investing cash flow	-5.3	-3.9
Financing cash flow	0.8	1.9
Net change in cash	-3.6	-0.5
Operating cash flow (IFRS)	0.9	1.5
Adjustment for IPO costs in ops CF	-	0.6
Operating cash flow (adjusted)	0.9	2.1

Main drivers for dampened operating CF development: Increased trade receivables and inventories; general expansion of the business

Outlook 2017 for va-Q-tec Group

• Increased energy efficiency to achieve highest possible energy label
• Tightening energy labeling standards: From 2017 onwards, tanks labeled "C" are forbidden in the EU, A+ only achievable with super-insulation (VIP)
• Simplicity of production process for Viessmann and reduction of logistics costs, as insulation material is much thinner than conventional solutions
• VIP solutions which have initially only been offered in most expensive product ranges will prospectively also be used in mass market products

va-Q-shell

VIP-based hot water storage insulation requires silica core materials as glass fiber core VIPs do not withstand the prevailing temperatures

Test results of va-Q-tec VIP insulated tanks

Size [ltr]	Heat loss (conventional solution) [kWh/24h]	Heat loss (VIP solution) [kWh/24h]	Improvement [%]	Label without VIP solution	Label with VIP solution
120	1.16	0.74	36	B	A
185	1.44	0.70	51	B/C	A+
785	3.34	1.58	53	D	A

Our path going forward

Thank you for your attention!

va-Q-tec AG

Alfred-Nobel-Straße 33 97080 Würzburg Tel.: +49 931 35942-1616 Fax: +49 931 35942-0 IR@va-Q-tec.com

TICKER

Symbol: VQT Bloomberg: VQT:GR Reuters: VQTG:DE ISIN: DE0006636681 WKN: 663668

BACKUP

Chart Performance and Trading Volume, 30.09.2016- 18.08.2017