SAF-HOLLAND SE

Investor Presentation • Jun 3, 2024

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CONFERENCE CALL PRESENTATION Q1 2024

stronger together one global partner

ALEXANDER GEIS (CEO), FRANK LORENZ-DIETZ (CFO)

MAY 8, 2024

Highlights and regional performance Q1 2024

M&A	nd 2024; Tecma closing on April 2nd Full consolidation of IMS Group as of January 2 2024
Sales development	Sales growth of +5.2% yoy positively impacted by acquisition-related effects from Haldex and IMS Group counteracting declining OE markets in EMEA & North America
Adj. EBIT margin	Strong improvement in profitability from 9.0% of 9.6% due to strict cost management as well as favorable regional and customer segment mix
Cash flow & leverage	Seasonal NWC built-up impacted operating free cash flow which amounted to EUR -12.4 mn; leverage of 1.9x remains below 2024 target of 2.0x
Outlook	2024 outlook confirmed

SAF-HOLLAND with sustainable performance in softer market environment

Sales	Adjusted EPS		NWC ratio	Operating FCF
EUR 505.4 mn (Q1 2023: EUR 480.4 mn)	EUR 0.69 (Q1 2023: EUR 0.54)	9.6% (Q1 2023: 9.0%)	16.5% (31 Dec. 2023: 14.1%)	EUR -12.4 mn (Q1 2023: EUR 5.4 mn)

SAF-HOLLAND off to a solid start into 2024

Increased share of aftermarket business driven by normalization of OE market

Strong profitability based on strict cost management, Haldex synergies and AM business

Q1 Q2 Q3 Q4

Solid performance in EMEA due to Haldex and IMS Group acquisition

Sales

• Q1 2024 organic sales growth amounted to -7.3%
• Newly acquired IMS Group contributed a mid single-digit euro million amount to sales
• Slight sequential organic growth of OE business compared to Q4 2023

Adj. EBIT and margin

• Adj. EBIT grew by 5.0% to EUR 19.8 mn which resulted in an adj. EBIT margin of 8.1%
• Strict cost management as well as segment mix support favorable margin development
• Positive impact from acquisition-related synergy effects

Americas region defies weaker market momentum and achieves strong adj. EBIT margin

Americas adj. EBIT and margin

Sales

• Q1 2024 with solid sales growth (including an organic sales growth of -15.5%) and a significant acquisition-related contribution from Haldex
• Organic sales development was muted due to softer customer demand for trailer and truck products in the US while aftermarket business was able to more than compensate for weaker OE dynamics
• Truck market with only slight declines while trailer market stronger impacted by ongoing normalization

Adj. EBIT and margin

• Adj. EBIT increased strongly by 11.0% to EUR 21.0 mn and thus resulted in an improved margin of 10.6%, positively influenced by realized cost synergies from the Haldex takeover
• Sequentially compared to Q4 2023, capacity adjustments as well as a higher aftermarket share were able to compensate lower volumes

Strong profitability development in APAC fueled by significant sales growth

Sales

• Q1 2024 organic sales growth amounted to 14.8% despite softer demand from North America which impacts the trailer production in APAC.
• Continued favorable market dynamics in India, Australia and China

Q1 Q2 Q3 Q4

Adj. EBIT and margin

• Significant increase in adj. EBIT of 38.9% to EUR 7.7 mn mainly based on higher volumes
• Additionally, profitability benefited from a continued improvement in China

Financials Q1 2024

EBIT to adjusted EBIT reconciliation for the Group

in EUR mn	Q1 2024	Q1 2023
EBIT	43.4	38.8	+11.8%	Adjustments in Q1 2024 purely refer to PPA 1
EBIT margin in %	8.6	8.1
Additional depreciation and 1 amortization from PPA	5.2	2.3		2 Q1 2023 was also impacted by restructuring and transaction costs of EUR 1.4 mn due to Haldex post merger integration activities as well as EUR 0.4 mn
Valuation effects from call and put options	-	-		related to the cyber attack
Restructuring and transactions costs 2	-	2.2
Impairment on property, plant and equipment and intangible assets	-	-
Other adjustments	-	-
Adj. EBIT	48.6	43.4	+12.0%
Adj. EBIT margin in %	9.6	9.0
Adj. EBITDA	63.8	55.7	+14.5%
Adj. EBITDA margin in %	12.6	11.1

Significant increase in adj. result for the period

Finance result improved from EUR -10.2 mn to EUR -6.2 mn mainly due to the valuation of intercompany foreign currency loans at the closing rate 1

Q1 2024 tax rate of 28.8% driven by lower non-capitalized deferred tax assets on loss carryforwards at some subsidiaries (Q1 2023: 31.8%) 2

Equity ratio continues to grow close to 30% range

• Increase in equity by 5.5% compared to 31 December 2023 due to high result for the period
• Balance sheet total grew by 2.4% compared to 31 December 2023 primarily due to the acquisition of IMS Group
• Hence, equity ratio improved by 0.9%pts and came close to the 30% range

Seasonal increase in net working capital

Net working capital (in % of sales) 17.4% 15.9% 15.7% 15.6% 15.5% 15.4% 14.8% 14.8% 14.5% 14.4% 14.1% 12.0%												16.5%
EUR mn	Mar 2021	Jun 2021	Sep 2021	Dec 2021	Mar 2022	Jun 2022	Sep 2022	Dec 2022	Mar 2023	Jun 2023*	Sep 2023*	Dec 2023	Mar 2024
Inventories	155.8	176.0	195.3	194.0	211.9	237.0	237.9	202.2	308.4	305.7	308.03	306.7	322.6
Trade receivables	130.0	148.9	147.2	136.3	176.1	184.6	187.0	144.7	283.0	286.4	253.2	219.7	256.6
Trade payables	-147.4	-163.4	-160.6	-145.8	-179.3	-176.2	-187.3	-159.0	-262.2	-261.4	-248.5	-228.6	-228.2
NWC	138.4	161.5	181.9	184.4	208.7	245.5	237.6	188.0	329.2	330.7	313.0	297.8	350.9
Sales (LTM)	961.7	1,091.4	1,175.6	1,246.6	1,330.7	1,411.7	1,497.5	1,565.1	2,112.8	2,143.2	2,165.1	2,106.2	2,135.7

• NWC-ratio increased from 14.1% at year-end 2023 to 16.5%, showing a usual seasonal development in the first quarter of a year
• NWC grew by 17.7% compared to Dec 2023 in particular due to a reporting date related increase in trade receivables (+16.8%) as well as a delayed adjustment of inventories to the lower production volume (+5.1%)
• In addition, the consolidation of IMS Group led to an increase in NWC positions

Note: Since March 2023 data includes Haldex

* Mar to Sep 2023 LTM sales include Haldex' contribution on a pro forma basis.

Swing in operating free cash flow mainly due to change in NWC

in EUR mn	Q1 2024	Q1 2023
EBITDA	63.8	53.5
Change in Net Working Capital	-43.6	-22.6
Taxes paid	-12.9	-7.5
Others	-14.2	-11.3
Net CF from operating activities	-6.9	12.1
Operating capex	-5.5	-6.7
Operating free cash flow	-12.4	5.4

Operating free cash flow*

• EBITDA increased due to early cost adjustments as well as favorable regional and customer segment mix
• Higher negative changes in NWC (EUR -21.0 mn) in particular impacted by change in trade receivables and trade payables; Q1 2023 figures were influenced by the cyber attack
• Paid income taxes grew strongly (+EUR 5.4 mn) due to higher earnings in previous periods
• Capex amounted to EUR 7.4 mn or 1.5% of Group sales
• Q1 2024 investments focused on further automation and modernization of production processes in EMEA and Americas

* Pre acquisitions / acquisition of Haldex shares

Remarkable ROCE level continues

Return on capital employed (in %)

EUR mn	Mar 2021	Jun 2021	Sep 2021	Dec 2021	Mar 2022	Jun 2022	Sep 2022	Dec 2022	Mar 2023*	Jun 2023*	Sep 2023*	Dec 2023	Mar 2024
Equity	325.2	334.8	353.7	371.1	390.5	431.1	468.5	441.4	449.8	433.4	468.8	476.0	502.3
Financial liabilities	332.4	323.7	318.5	322.2	318.9	369.9	614.5	715.7	663.3	683.8	663.6	628.7	647.4
Lease liabilities	42.7	41.6	41.7	41.1	40.4	40.9	39.9	38.4	62.7	68.0	67.4	67.8	66.5
Pension provisions	32.2	32.2	32.7	22.3	22.5	16.8	16.9	15.3	43.1	41.6	42.3	43.2	42.7
Cash/cash equivalents	-179.5	-164.9	-159.5	-165.2	-148.9	-173.0	-206.2	-243.5	-218.0	-215.3	-255.7	-246.3	-231.4
Capital employed	553.0	567.4	587.1	591.4	623.4	685.7	933.7	967.3	1,000.9	1,011.5	986.5	969.3	1,027.4
Adjusted EBIT (LTM)	62.3	82.1	91.5	93.1	94.7	101.8	114.1	124.6	165.0	172.6	180.3	202.1	207.3

* For better comparability, Mar to Sep 2023 LTM adjusted EBIT includes Haldex' contribution on a pro forma basis.

20.2% • ROCE amounted to 20.2% at the end of the first quarter, slightly decreased from high level at year-end 2023 predominantly due to the growth in equity as well as a moderate reduction in SAF-HOLLAND's cash position

Leverage remains almost stable at 1.9x

* Reported EBITDA (LTM) ** Dec 2022 net debt/EBITDA ratio of 0.7x did not include additional debt to finance the acquisition of Haldex Note: Net debt / EBITDA calculation includes Haldex related debt and pro-forma EBITDA (LTM) contribution for the periods Mar to Sep 2023.

• Net debt/EBITDA Net debt/EBITDA ratio amounted to 1.9x at the end of Mar 2024, only slightly up from 1.8x at year-end 2023
  • Increase in net debt mainly due to negative free cash flow
  • Cash and cash equivalents were EUR 14.8 mn lower compared to 31 December 2023
  • Slight increase of long-term interest-bearing loans and bonds (+EUR 15.6 mn)

Outlook FY 2024 and key takeaways

FY 2024 market outlook – Continued normalization in EMEA and Americas

	FY 2024e Trailer Market	FY 2024e Truck Market
EMEA	~ -15%	~ -15%
North America	~ -23%	~ -10%
Brazil	+/- 0%	~ +36%
China	~ +5%	~ +10%
India	~ +10%	~ -5%

* Indicative view based on FY 2023 sales

EMEA

• Based on an uncertain macroeconomic environment as well as on SAF-HOLLAND's current order situation, the European trailer market is expected to further normalize with a recovery expected in the second half of the year
• The European truck market expectations are unchanged

North America

• Truck market expectations slightly improved compared to FY 2023 reporting
• Trailer market outlook almost unchanged

Brazil

• Trailer market is expected to be flat while truck markets are expected to increase significantly in 2024

China

• Both trailer and truck markets are expected to grow

India

• Sharp increase in 2023 mainly based on public infrastructure investments and subsidies
• After parliamentary elections, more clarity on future development of Indian commercial vehicle market

Note: Market forecasts are internal management assumptions based on customer communication, IHS Markit (Q1 2024), ACT Research (North America, April 2024), ANFAVEA (Brazil, Q4 2023)

2024 Outlook confirmed - robust profitability despite slightly lower sales

	Group FY 2023 Results*	Group FY 2024 Outlook
Sales	EUR 2,106.2 mn	Around EUR 2,000 mn
Adj. EBIT margin	9.6%	9.0% to 9.5%
Capex ratio**	2.9%	Up to 3%

* Incl. Haldex contribution, consolidated as of February 21, 2023

** Incl. payments for investments in property, plant and equipment and intangible assets as well as capitalized R&D

Solid start to 2024 based on full Haldex and IMS consolidation as well as favorable mix effects and strict cost management

Market normalization continues as expected after several years with strong customer demand

Full Year 2024 guidance confirmed, including a solid Q1 and upcoming project and wage costs expected from Q2 onwards

SAF-HOLLAND with resilient business model well set up for softer 2024 market

Contact and additional information

Investor relations contact & financial calendar

Issuer & contact	Financial calendar and road show activities
SAF-HOLLAND SE  Hauptstrasse 26  63856 Bessenbach	May 23, 2024	M.M.Warburg Conference, London
Dana Unger Vice President Investor Relations, Corporate & ESG Communications	June 04 & 05, 2024	Berenberg Roadshow, North America
Tel: +49 6095 301 – 949	June 06, 2024	M.M.Warburg Conference, Hamburg
Alexander Pöschl Senior Manager Investor Relations, Corporate & ESG Communications	June 11, 2024	Annual General Meeting
Tel: +49 6095 301 – 117	August 08, 2024	Publication of Half-Year Financial Report 2024
Michael Schickling Senior Manager Investor Relations, Corporate & ESG Communications	September 04, 2024	Commerzbank & ODDO BHF Corporate Conference, Frankfurt
Tel: +49 6095 301 – 617 Marleen Prutky	November 12, 2024	Publication of the Quarterly Statement Q3 2024
Junior Manager Investor Relations, Corporate & ESG Communications

Email: ir@safholland.de

Tel: +49 6095 301 – 592

Disclaimer

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