Servizi Italia

Earnings Release • Mar 21, 2017

STAR Conference Milan 2017

TINFO

DIGITAL
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Group overview 1/2

• SERVIZI ITALIA is the Italian undisputed leader in providing industrial laundry and sterilization services to the public healthcare system, thanks to a consolidation strategy made of internal growth and acquisitions.
• SERVIZI ITALIA satisfies expectations and needs of customers thanks to a high quality of mix of products and $\bullet$ services.
• A business model which contributes to the rationalization of healthcare costs and social sustainability in $\bullet$ Italian regions and wherever it operates.

WASH-HIRE

Washing and hire of flat linen (sheets, sleepers, blankets), packed clothes (gowns, scrubs, hospital uniforms), mattresses and pillows.

LINEN STERILIZATION

Sterilization Reusable Textile for operators gowns, towels and procedural kits for surgical activities, as well as accessory parts for disposable material.

SURGICAL INSTRUMENTS STERILIZATION

Collection, conditioning, maintenance and sterilization of surgical instruments, kits recomposition and management of the CSSD.

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The Business

SERVIZI ITALIA has constantly demonstrated to be partner of choice of the Italian healthcare service and hospitals, thanks to its proven and recognized quality service.

1. LONG-TERM CONTRACTS AND ACTIVITY PLANNING FOR FUTURE YEARS

• Revision of contracted prices according to regulations in force;
• High quality of credits (mainly government bodies);
• Cross-selling opportunities on wash-hire contracts for higher value added services.

2. INVESTMENTS MADE ONLY AFTER CONTRACT ACQUISITION and refund according to contract.

1. MIX PRODUCT/SERVICE which creates strong barriers on entry.

Creating value over time:

• Optimization of costs both logistics and productive
• Commercial synergies and common processes
• Development of high value-added services
• International development strategy
• Renegotiation of expiring contracts at improved conditions

4 YEARS

Wash-hire

6 YEARS

Sterilization

Source: Smart Lavanderie Industriali April 2016 – Databank Cerved Group

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New markets

In the countries where it is active, Servizi Italia has found some interesting features in order to export its business model.

• √Presence of recent markets currently under heavy development and looking for qualified operators in order to meet the high demand connected to washhire/sterilization activities, partly due to an increase of the so-called medical tourism:
• $\checkmark$ High penetration rate in the market: only a few of wash-hire services are currently outsourced to private operators, both in public and private healthcare;
• $\checkmark$ Low competitiveness: average operators are small, with low self-financing capacity and inefficient management models.
• √Old fashioned laundry plants, lacking of an industrial management model with real opportunity to make efficiency by exporting technical management of the business models adopted by the Group.

* Source: Ministerio de Saude "BRASILE: Il mercato di macchine per lavanderie e stirerie", a cura di ICE San Paolo, February 2011

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Focus Turkish market

The SERVIZI ITALIA Group is present in Turkey with two different companies dealing with industrial laundry (ANKATEKS) and sterilization (SAS STERILIZASYON SERVISLERI).

ANKATEKS, main Turkish operator in hospital laundry sector, known as "Ankara Laundry" and active in the area of Ankara and - through the controlled company ERGULTEKS - in Izmir as well.

3 INDUSTRIAL LAUNDRY PLANTS which are technologically advanced and strategically positioned in the country (Ankara and Izmir).

PPP PROJECTS: local reforms will lead to the construction of new hospitals with public-private participation, which is estimated to increase the number of beds in the market up to about 250,000 over the next few years.

At the moment there is no predominant group in wash-hire and sterilization markets: some hospitals perform these services internally, while others rely on companies which offer cleaning and laundry services for other sectors.

$\approx$ 1,400* HEALTHCARE FACILITIES

OVER 195,000* AVAILABLE BEDS

ABOUT 6 MILLION* INTERVENTIONS/YEAR

Focus on Indian market

The Servizi Italia Group is present in India, in the area of New Delhi, with the start-up Shubhram Hospital Solutions Pvt. Ltd, which started to generate revenues in July 2015.

The Indian market has recently started the outsourcing process of wash-hire and sterilization activities.

1 technologically advanced laundry plant in Delhi NCR.

Focus on Albanian market

Subscription of a 10-year contract for sterilization, maintenance and renting of surgical instruments, as well as sterilization management of re-usable medical devices and supply of disposable medical devices to all public and private hospitals of the Republic of Albania.

SERVIZI ITALIA has established a new company, SANISERVICE, based in Tirana, of owning the 30% of it.

The concession started in the first quarter of 2016 at the University Hospital Center "Mother Theresa" in Tirana with a two-year roll-out plan, which envisages the extension of the service initially to other university hospitals in Tirana and, at a later stage (within about two years from the start of the concession), to all the public hospitals in the Country.

OVER 195,000 HEALTHCARE FACILITIES IN INDIA

OVER 90,000 BEDS IN DELHI NCR

OVER 200,000 KG OF LINEN

TOTAL VALUE AWARDED: Euro 70 million

OVERALL DURATION OF CONTRACT 10 years

NR INTERVENTIONS/YEAR: Over 50,000

Group values

Focus on customers

Investing in research of tailor solutions to propose and carry out together with customers.

Efficiency research

Services are based on a process of industrial production subjected to frequent analysis, in order to production efficiency goals.

Values

The approach of SERVIZI Italia is set to guarantee a high level of service to benefit of patients and citizens, as beneficiaries of assistance and health services.

Transparency
Sharing

Thus Sharing
Responsibility
AwarenessConsistency

Organizational solidity and reliability

Servizi Italia is a deep-rooted company, with a wide production network.

Product and process innovation

Backed by a strong cooperation with research centers and international university centers.

Safety and transparency

Guaranteed by the traceability of products and the quality system certification process.

Professionalism

Enhance skills and talents, attracting and retaining the best resources.

Internationalization

Being a multinational company for organization, culture, modes of presence and respect in global markets.

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Main details on Stock Exchange

DIVIDENDS DISTRIBUTED PER YEAR

Details on shares (as at 16/03/2017)
Share capital	31,809,451
Share price	€ 3.8560
Capitalization	€ 122,657,243

FLOATING CAPITAL

Source Consob. Updated at 16,03,2017

Main economic consolidated results FY2016 1/2

(Euro thousands)	31/12/2016	31 /12/2015	Changes	$Ch.$ %
Revenues	237,716	229,983	7,733	3.4
EBITDA	64,022	63,649	373	0.6
EBIT DA %	26.9	27.7%
EBIT	13,745	16,565	(2,820)	$-17.0$
EBIT %	5.8	7.2%
Net Profit	10,515	12,483	(1,969)	$-15.8$
Net Profit%	4.4	5.4%

REVENUES - EBITDA

REVENUES - REVENUES FROM ABROAD

EBIT - NET PROFIT

15

Main economic consolidated results FY2016 2/2

REVENUES PER BUSINESS LINE

MARGINS BY BUSINESS LINE

REBALANCING OF PRODUCTION MIX

Generation of cashflow

Even in presence of a capital intensive business, Servizi Italia is able to generate important positive cashlows from its operative activity.

During the last few years, the management decided to invest its resources into structural investments, for consolidating its leadership position and for a constant growth and improvement of Group perfomance.

Net of operating investments, Servizi Italia generated cash over Euro 184 million from 2006 to 2016.

Main financial results

(Euro thousands)	FY2016	FY2015
Operating net working capital	12,608	13,726
Other short-term assets/liabilities	(11,692)	(7, 565)
Net working capital	916	6,161
Fixed assets - Medium/Long term provisions	216,457	183,086
Invested capital	217,373	189,247
Shareholders' Equity (B)	137,756	122,094
Net financial debt (A)	79,617	67,153
Invested capital $(C)$	217,373	189,247
Gearing (A/A+B)	36.6	35.5%
Debt/Equity (A/B)	57.7	55.0%

CREDIT LINES FY2016

NET FINANCIAL POSITION

NET DEBT/EQUITY

Disclaimer

This presentation has been prepared by Servizi Italia S.p.A. ("Servizi Italia" or the "Company") and must be read in conjunction with its oral presentation.

The information contained in this presentation does not purport to be comprehensive. Neither Servizi Italia S.p.A. nor any of its officers, employees, advisers or agents accepts any responsibility for/or makes any representation or warranty, express or implied, as to the truthfulness, accuracy or completeness of the
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The information in this document and any other material discussed at the presentation are provided as at the date of this presentation and is subject to completion and change without notice.

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Servizi Italia S.p.A.

Via S. Pietro, 59/b 43019 Castellina di Soragna (PR) Italy Tel.+39 0524 598511 - Fax+39 0524 598232 Share capital: Euro 31,809,451 fully paid-up Founded: 1986 Tax ID Number and ParmaB Business Registry Code: 08531760158 Market: MTA – STAR segment

Sector: Industrial ISIN code for ordinary shares: IT 0003814537 Reuters: SRI.MI --- Bloomberg: SRI IM Investor Relations: Giovanni Manti, Chiara Peterlini Email: investor@si-servizitalia.com web site: www.si-servizitalia.com