Biesse — Investor Presentation 2020

Sep 22, 2020

COMPANY PRESENTATION

AUTUMN 2020

OUR IDENTITY

OUR VALUES

Biesse Group is a global leader founded in Pesaro in 1969 by Giancarlo Selci. Listed on the Borsa Italiana since 2001 – STAR The Group has a strong Italian identity and strongly believes in:

segment. INNOVATION INTEGRITY PROACTIVITY

THE VISION

Biesse Group's vision is embodied by the word THINKFORWARD:

LOOK AHEAD A STIMULUS TO ANTICIPATE THE FUTURE AND SETTING NEW STANDARDS TO DRIVE TECHNOLOGICAL INNOVATION AND DIGITAL TRANSFORMATION.

ONE INDUSTRIAL GROUP

4 MAIN BUSINESS DIVISIONS

12 PRODUCTION SITES

We manufacture technology for processing wood, glass, stone, advanced materials and metal through specialised business units and 12 manufacturing sites in Italy and worldwide. We operate worldwide with our own key brands: Biesse, Intermac, Diamut, HSD.

ALL OVER THE WORLD

We support our colleagues all over the world, using the most advanced management, sales and support systems. Our global network enables us to be always close to our customers.

39 SUBSIDIARIES AND REPRESENTATIVE OFFICES

DISTRIBUTORS

+300 SELECTED

SUPPORTING OUR CUSTOMERS

Customers in 120 countries: manufacturers of furniture, design items and door/window frames, producers of elements for the building, nautical and aerospace industries. CUSTOMERS IN

120 COUNTRIES

WITH OUR PEOPLE > 4k

We acknowledge that people are essential to our development, because the ability to innovate and pursue excellence in the realisation of products is the consequence of the passion and dedication of all those that are part of the Biesse family.

EMPLOYEES*

* temporary workers included

SUSTAINABILITY

PLANNING FOR A MORE SUSTAINABLE FUTURE

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All activities are carried out in recognition of the moral and social responsibilities that we have towards our stakeholders, in the belief that the achievement of sales objectives cannot overlook our values of honesty, integrity, fair competition and correctness in dealings with all our stakeholders, including shareholders, customers, employees, suppliers and local communities.

CSR HIGHLIGHTS

ECONOMIC SUSTAINABILITY

More than

300

persons involved in R&D activities

89%

of purchases by our manufacturing plants in Italy, India and China come from local suppliers

SOCIAL SUSTAINABILITY

95%

of employees have permanent contracts

+100K

hours of training provided to personnel during the course of 2019

ENVIRONMENTAL SUSTAINABILITY

of waste products are non-hazardous

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2020 MAIN TARGETS

REDUCTION OF THE EMISSION IN THE ATMOSPHERE

-40% CO2 at least

* Through strategies of carbon footprint reduction aimed at utilising energy from renewable sources combined with energetic efficiency.

*C02 scope 2 market based

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2020 MAIN TARGETS

ISO 45001

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CERTIFICATION OF THE HEALTH AND SAFETY SYSTEM FOR BIESSE SPA

Biesse Spa has started the process of formalization and certification of the health and safety system in accordance with ISO 45001 international standards.

SALES BREAKDOWN

CUSTOMERS

CUSTOMERS

CUSTOMER SALES

>67,000

A wide and fragmented customer base with no risk of concentration. From small manufacturers to medium/large industries.

CUSTOMERS

A wide and fragmented customer base with low risk of concentration

95

industries

Small-medium companies

n°

of Clients

20 10,000> (€/000) (€/000) average Sales per Client

STRATEGY RECAP

STRATEGY

In the next 3 years, Biesse's strategy will be focusing on four main directives: the strengthening of our offering through Digitalisation and Product Innovation supported by the reorganization of the Company's processes and the extension of our sales network.

BIESSE SMART FACTORY

THE MARKET EXPECTS

Solutions that allow manufacturing companies of the fourth industrial revolution to evolve technologically, combining human skill and experience with total production automation and interconnectivity.

BIESSE RESPONDS

with advanced technologies and services that can digitalise and automate factories and production processes, optimising all their main assets - whether technological, strategic, organisational or human.

SOPHIA: SMART FACTORY ENABLER

Digital transformation

The use of Artificial Intelligence solutions and IoT technologies enable our clients to remotely activate and manage their manufacturing systems.

Biesse responds to the future

SOPHIA is a central hub of services connected to machines. The future objective is to evolve the platform into a centralised coordinator of services based on Artificial Intelligence.

Smart Objects

Internet of Things

Machine Learning

"Focus on your work, Sophia takes care of the rest".

SOPHIA RESULTS

>2,000

Connected Machines by SOPHIA in 2019

>50,000

Carts Created on Parts, the Online and in-app SOPHIA Marketplace

1Hour

With SOPHIA the average response time for a machine downtime ticket is 1 hour in 80% of cases

of Customers in Italy and 70% worldwide have renewed the service

SOPHIA TARGETS

10000

Spare Parts order on SOPHIA Marketplace (Parts) by 2022

Route to the future

12000 Digital innovation creates the future: an inevitable process, that is yet to be developed in machinery industry. SOPHIA paves the way for the future of Industry 4.0, starting now.

Number of SOPHIA packages sold with new machines and renewal 2018-2022

CORE SEGMENTS MARKET 2019

We are in leading positions in our reference markets: Wood, Glass, Stone working machines. We want to consolidate our positioning fostering product innovation Entire market

the glass processing market in which we operate.

the stone market in which we operate.

NEW SEGMENTS MARKET 2019

We entered in new market segments, we want to continue to increase our market penetration.

STRUCTURAL WOOD

Our competitors are mainly located in Germany and in Italy. The most important are Hundegger (market leader), HOMAG and Weinmann.

METAL (MECHATRONICS)

Our main competitors are KESSLER, IBAG, GMN, WEISS (Siemens), FISHER and STEPTEC.

ADVANCED MATERIALS

Highly fragmented market, our main competitors are Geiss, Belotti CMS Industrie, Breton, Mecanumeric, and Multicam.

IH 2020

EXTRACT OF THE P&L

€/mln	FY2014	FY2015	FY2016	FY2017	FY2018	FY2019	IH 2019	IH 2020
Net sales -1 year	427 +12.9%	519 +21.5%	618 +19.1%	690 +11.6%	741 +7.4%	705.9 -4.8%	344.2	256.7 -25.4%
Cost of goods sold	171 40.1%	206 39.7%	245 39.6%	270 39.1%	295 39.9%	286 40,6%	156.4 45.4%	124.7 48.6%
Labour & Overhead	219	253	301	335	359	350	113.1	89.9
cost	51.3%	48.7%	48.7%	48.6%	48.5%	49.6%	32.9%	35.0%
EBITDA	40	64	76	89	93	77	39.1	22.5
%	9.3%	12.4%	12.3%	12.9%	12.5%	10.9%	11.4%	8.8%
EBIT*	25	44	55	64	64	30*	20.1	4.4
%	5.8%	8.4%	8.9%	9.2%	8.6%	4.2%	5.8%	1.7%

*before non recurring items

SALES BREAKDOWN

NET DEBT

€/mln

RECEIVABLES PAYABLES INVENTORIES

CAPEX

total capex value total capex % on sales

Main investments items in the plan period 2020-2022: (tangible average 55.9%)

Components Cosmec (mechanical components) new plant and working centers

• India expansion of the manufacturing plant
• Subsidiary Biesse America campus
• Supply chain investments in the logistics network
• R&D capitalized
• Divestment of the Chinese plant

ORDERS INTAKE & BACKLOG

GROUP ORDERS INTAKE & BACKLOG 2020 June Group orders Intake 6 months -35.5% (vs 2019)

€/mln

134,4 133,3 225 IQ 2019 IIQ 2019 IIIQ 2019 IVQ 2019 IQ 2020 IIQ 2020 313 ^{90 82 78} 225 2011 2012 2013 2014 2015 2016 2017 2018 2019 orders intake backlog o IQ 2020 -24.7% vs IQ 2019 o IIQ 2020 -46.5% vs IIQ 2019 020 June Group backlog -20% (vs June 2019) and -8.3% (vs December 2019)

machines only

STAFF DISTRIBUTION

STAFF
DISTRIBUTION

	FY 2012	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017	FY 2018	FY 2019	IH 2020
ITALY % of total people	1,646 59%	1,547 57%	1,605 56%	1,780 56%	2,009 70%	2,176 57%	2,483 59%	2,418 62%	2,420 64%
OUTSIDE ITALY % of total people	1,136 41%	1,148 43%	1,276 44%	1,396 44%	1,609 44%	1,670 43%	1,744 41%	1,509 38%	1,373 36%
TOTAL	2,782	2,695	2,881	3,176	3,618	3,846	4,227	3,927	3,793

interim people at the end of March 2020: 298 Interim people at the end of June 2020: 248

total 4,041 (-4.35% vs March)

	FY 2019	IH 2020	%
Production	1,386	1,295	-6.57%
Service & After Sales	992	989	-0.30%
R&D	482	486	0.83%
Sales & Marketing	685	653	-4.67%
G&A	382	370	-3.14%
ITALY	2,418	2,420	0.08%
OUTSIDE ITALY	1,509	1,373	-9.01%
TOTAL	3,927	3,397	-3.41%

STAFF DISTRIBUTION (without interim people)

	FY 2012	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017	FY 2018	FY 2019	IH 2020
Production % of total people	1,264 45%	1,175 44%	1,201 42%	1,335 42%	1,482 41%	1,494 39%	1,621 38%	1,386 35%	1,295 34%
Service & After sale % of total people	574 21%	613 22%	628 22%	690 22%	803 22%	894 23%	1,001 24%	992 25%	989 26%
R&D % of total people	338 12%	321 12%	361 13%	383 13%	436 12%	479 12,5%	501 12%	482 12%	486 13%
Sales & Marketing % of total people	364 13%	351 13%	439 15%	495 15%	587 16%	641 17%	715 17%	685 17%	653 17%
G&A % of total people	242 9%	235 9%	252 9%	273 9%	310 8,5%	338 8,8%	389 9%	382 10%	370 10%
ITALY % of total people	1,646 59%	1,547 57%	1,605 56%	1,780 56%	2,009 56%	2,176 56%	2,483 59%	2,418 62%	2,420 64%
OUTSIDE ITALY % of total people	1,136 41%	1,148 43%	1,276 44%	1,396 44%	1,609 44%	1,670 44%	1,744 41%	1,509 38%	1,373 36%
TOTAL	2,782	2,695	2,881	3,176	3,618	3,846	4,227	3,927	38 3,793 -3.4%

COVID-19 CRISIS

FACE THE CRISIS

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Our main goals:

a) keep safe our people

b) re-think and re-organize our business model

c) be ready and reactive for the future changes

FACE THE CRISIS

Our main goals:

a)

b)

• adopt all available health measures to keep safe our people
• smart working increase-prolong
• constant internal communication
• review the operating activities, adapting our model to the customers request
  • support and focus the margins, maintaining the liquidity
  • do not give up / slow down the innovation in technology (R&D investments)
• c) internal analysis regarding the organizational measures to be taken in respect of the laws (health) external analysis of any possible impact of the Covid-19, especially for the future development evaluate all the possible steps to be taken considering our ESG commitment

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FACE THE CRISIS

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Focus on cost containment:

Labour cost

• forced collective holidays (residual balance if any)
• CIGO (temporary lay-off scheme)

Cost cutting

• travel, exhibitions and marketing costs reduction
• renegotiation of key contracts (fixed costs)

Investments

CAPEX reduction postponement of the NON-Strategic projects

FINANCIAL SUPPORT

FINANCIAL SUPPORT

• confirmed the existing short term facilities
• confirmed the existing committed facilities
• obtained new committed facilities (> 24 months)

€/MIL

obtained new M/T loans (> 18 months)

SHAREHOLDERS

B.O.D.

€/MIL SHAREHOLDERS BREAKDOWN BY OWNERSHIP & B.O.D. 51,0% 49.0%

Norges Bank; 2,1% Lazard; 2,2% Vanguard; Allianz; 5,0% Groupama; 3,9% Fideuram ; 1,2%

1,4%

major shareholders for the free float quote

Bi.Fin s.r.l (Selci family)

free float

Biesse B.o.D.:

Giancarlo Selci (founder - president)

Roberto Selci (C.E.O.)

Stefano Porcellini

Alessandra Parpajola

Silvia Vanini

Giovanni Chiura (indipendent)

Federica Palazzi (indipendent)

Elisabetta Righini (indipendent)

Source: Bloomberg/Reuters

DISCLAIMER

• This presentation has been prepared independently by Biesse S.p.A. and can be used only during meetings with investors and financial analysts. It's solely for information purposes and it may contain statements regarding future financial performances and Company's expectations
• Even if Biesse takes care that the information contained in the document have the requirements of reliability , correctness and newness, Biesse is not responsible for the content processed by third parties and content indicated in this Document. No liability is accepted by or on behalf of Biesse for any errors, omissions or inaccuracies contained in this presentation.
• Any forward looking statements are not guarantees of future performances and is related only of the date of this document. Th ey are based on the Group's current state of knowledge, future expectations and projections about the future events. By their nature they are subject to inherent risks and uncertainties.
• Further information concerning the Group results, including factors that could materially affect the Company itself (i.e. IFRS) will be included and detailed in the Financial Statement of the Group.
• For further details on the Biesse S.p.A. reference should be made to publicly available information. including the Quarterly Reports, the Half Annual Report, the Annual Reports and the Three Years Business Plan.
• Any reference to past performance of the Biesse S.p.A. shall not be taken as an indication of future performance.
• This document does not constitute an offer or invitation to purchase or subscribe for any shares and no part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
• No action should be taken or omitted based on the information contained in this Document. Biesse accepts no liability for the results of any action taken on the basis of the information contained in this Document.
• By attending the presentation you agree to be bound by the foregoing terms.
• The User is not granted any license or right of use and therefore is not allowed to record such content in whole or in part- on any type of media, reproduce, copy, publish and use them for any purpose without prior written permission.

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