Biesse — Investor Presentation 2021

Jul 30, 2021

Business Plan

1

Business Plan 2021-2023

Index

THE GROUP GROUP STRATEGY

OUR FUTURE IN FIGURES

2021 Business Plan -2023

THE GROUP 1.

-2023

Business Plan

AN INDUSTRIAL GROUP

Biesse Group is an international company that designs, manufactures and distributes systems and machines for processing wood, glass, stone, metal, plastic and composite materials.

The Group's solutions are aimed at the furniture, housing & construction, automotive and aerospace sectors.

Founded in Pesaro in 1969 by Giancarlo Selci, it has been listed in the STAR segment of the Italian Stock Exchange since 2001.

85% of its consolidated turnover is achieved abroad.

It operates in over 160 countries with 13 manufacturing sites and a direct presence of 37 showrooms around the world, as well as an extensive dealer network.

Its customers include industry leading companies and some of the most prestigious names in Italian and international design.

Today it has 4,300 employees.

THE OFFER RANGE

MACHINES	We design, manufacture and distribute a full range of machinery and technologies for processing wood, glass, stone, metal, plastic and composite materials.
SYSTEMS	We build engineering solutions, from system design to manufacturing, implementation, installation and maintenance.
SERVICES	We provide professional after-sales services to support the efficiency and productivity of installed machinery.
MECHATRONICS	We design, manufacture and supply high-tech mechanical and electronic components for Industry 4.0 ready machines.
TOOLING	We design, manufacture and distribute a complete range of tools for working with glass, natural and synthetic stone and ceramics.

OUR CUSTOMERS' INDUSTRIES

-2023

Business Plan

SUPPLY CHAIN

Construction Customer focus and satisfaction are the basis of a strategic approach that begins with sustainable supply chain management and continues through all stages of the product life cycle.

Arredamento Housing &

An integrated, end-to-end and flexible approach allows us to deal with unexpected events and guarantee production continuity, to offer a level of service that is increasingly responsive to customer needs over time.

HSD becomes a Lighthouse Plant of the Factory Cluster with the Electrospindle 4.0 project.

MANUFACTURING SITES

The Group has 13 manufacturing sites in Italy and India with a total of over 110,000 square meters.

8 sites are ISO 9001:2015 certified.

GROUP SUPPLIERS

The Group cultivates the relationship with the territories: 89% of purchases are made with suppliers local to manufacturing sites in Italy and India.

-2023

Business Plan

PEOPLE

The Group recognizes its people as the essential factor in its success and ability to pursue excellence.

TRAINING

69,000 hours of training provided to employees during 2020.

CONTRACTS

97% of Senior Management hired locally.

95% of employees have a permanent contract.

RETENTION

1,500 people have worked for the Biesse Group for over 10 years.

INTERNATIONALISATION

The Group's Headquarters is in Italy, 40% of employees reside abroad.

-2023

Business Plan

PLANNING FOR A MORE SUSTAINABLE FUTURE

All activities are carried out with an awareness of the ethical and social responsibility we have towards our stakeholders. We believe that the achievement of economic objectives cannot disregard the values of honesty, integrity, fair competition and fairness towards all our stakeholders, including shareholders, customers, employees, suppliers and local communities.

1. THE GROUP

MAIN GOALS ACHIEVED IN 2020

CO2 emissions (Scope 2 market based) compared to 2019.

UNI ISO 45001:2018 certified occupational safety management system for HSD S.p.A.

REVENUE

Group

2021

-2023

Business Plan

Consolidated

Net Sales

Charlotte, USA

Group

2021

-2023

Business Plan

PROFIT

-2023

Business Plan

CASH

NET FINANCIAL POSITION - BIESSE GROUP (€/MLN)

2021 Business Plan -2023

GROUP STRATEGY

• 2.1 Context
• 2.2 Strategy
• 2.3 Empower offering & go -to -market
• 2.4 Ensure sustainable growth
• 2.5 Enhance digital manufacturing
• 2.6 Enable future development

2.

-2023

Business Plan

CEO OUTLOOK FOR 2022

2009-2019e

0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0 4,5 5,0 5,5 6,0 6,5

WOODWORKING MACHINERY: RECOVER FROM PANDEMIC

2009-2019e Woodworking Machinery market experienced a strong decrease in demand in 2020e due to Covid-19 crisis. In the period 2021-2023 the Market is expected exceed 2018 value. In the period 2020-2023e the estimated CAGR in the reference market is approximately 9.4%.

WOODWORKING MACHINERY MARKET - (€/bln - %)

THE DIGITAL PARADIGMA

DIGITAL LEADERS ARE PERFORMING BETTER THAT THEIR COMPETITORS IN SEVERAL KEY AREAS:

Better at gaining customer trust

Better at providing a positive customers and employee experience and increasing stock price

Better at incrising revenues and increasing profit

Better at improving operational efficiency

Better time to market for new products or service offering

Source: Harvey Nash/KPMG CIO Survey, 2020 "The Future of Digital, Running at market speed - The role of IT in the new reality" March 2021, KPMG Report

TECHNOLOGIES THAT WILL IMPACT MACHINERY INDUSTRY

AI & Automation

• − Intelligent operations
• − Routing and load optimization
• − Workforce scenario planning

Advance Analytics

• − Predictive analysis
• − Quantum
• − Digital data & data repository

Augmented Reality

• − Digital twins
• − Rapid reality capture

Cybersecurity

• − Persistent threat
• − Cyber insurance

Platform Services

− Everything as a services (EaaS)

2021 Business Plan -2023

STRATEGY

In the next 3 years, Biesse's strategy will be focusing on four main directives.

Ensure sustainable growth Empower offering & go-to-market

• Strengthen product portfolio
• Accelerate services growth
• Focused commercial development
• Strengthen brand positioning

Enhance digital manufacturing Enable future development

• HSD & Lighthouse plant

• Sophia & Industrial IoT

• Integrated Global Supply Chain

• Corporate Social Responsibility Journey

  • Inspire people
  • Finance Evolution

• One Company model fully operational

• Explore additional growth opportunities

2021 Business Plan -2023

EMPOWER OFFERING & GO -TO - MARKET

2.3

-2023

Business Plan

STRENGTHEN PRODUCT PORTFOLIO

The 2021-2023 Product Portfolio strategy will be based on the following guidelines:

• Not only woodworking machines but also Other Materials machines (Glass, Stone & Advanced Materials), resulting in greater growth on the latter
• Reposition the Group's offer on a higher range
• More and more focus on Systems products

2.3

GO -TO

EMPOWER OFFERING &

-MARKET

ACCELERATE SERVICES GROWTH

Services have become increasingly important in the Group's offer. Over the next years, the Group will continue its development path, in particular:

• Expanding the Services portfolio by adopting a new model of relationship with the Customer
• Digitization will be one of the key elements in the interaction with the Customer and in the new Services that can be offered using the collected data
• The Service development and sales strategy will be combined with a Parts business development strategy
• The development of the Services will be supported by an improvement and optimization of the operating model to ensure the level of service

2.3

GO -TO

EMPOWER OFFERING &

-MARKET

FOCUSED COMMERCIAL DEVELOPMENT & EMPOWER BRAND POSITIONING

Main pillars for 2021 – 2023 Commercial Strategy:

• Strong focus on Americas and Asia -Pacific areas (also through new subsidiaries)
• Grow in Europe by improving sales and margins
• Stabilize the Italian market, improving margins
• Increase incidence on sales of Glass, Stone and Advanced Materials Machines and increase Systems products sales

The Commercial Strategy will be supported by an evolution in the go -to -markets, especially on:

• Increase digital interaction with customers (before and after the sale), redefining Customer Experience
• Strengthen Group's brand architecture
• Empower local markets organizations

2021 Business Plan -2023

ENSURE SUSTAINABLE GROWTH 2.4

ENSURE SUSTAINABLE GROWTH

In the 2021 – 2023 period, will be empowered the One Global Supply Chain Strategy to sustain sales growth, increase efficiency, reduce risks and improve time delivery to the customer.

Several actions will be carried out:

• Redesign the Italian and international industrial footprint
• Optimize the Italian plants organization
• Strategically redefine relationships with suppliers and supply chains
• Set new strategies for in -bound and out -bound logistics management consistent with the post pandemic world

CORPORATE SOCIAL RESPONSABILITY

In the 2021 – 2023 period, the Corporate Social Responsibility will assume an increasingly important role in corporate strategies.

Several actions will be carried out:

• Dedicated department in charge of CSR culture adoption, targets definition and KPI's monitoring
• The CSR will play a key role in the new suppliers strategy
• The sustainability will become a key parameter also in new product design

2021 Business Plan -2023

-2023

Business Plan

INSPIRE PEOPLE & FINANCE EVOLUTION

People will be the key success factor in plan execution. In the next years the Group will implement several actions to empower and inspire People:

• Empower markets organizations, becoming more and more international
• Foster diversity
• Set -up several re -skilling and re -shaping programs: Change Management, Academy, Smart Working

The evolution in Financial Management will be a key driver in monitoring Plan execution

• New role of Finance Business Partner to support and monitor business evolution
• Evolution of finance department tools towards best solutions on the market to use data and analytics to support business in decision making process

2021 Business Plan -2023

ENHANCE DIGITAL MANUFACTURING 2.5

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.

2021 Business Plan -2023

2.5 ENHANCE DIGITAL MANUFACTURING

DIGITAL EVOLUTION

SOPHIA: SMART

FACTORY ENABLER

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

BIESSE RESPONDS

with SOPHIA, 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.

Internet of Things

Machine Learning

>3,000

RESULTS 2021

SOPHIA

connected machines by SOPHIA in 2021

100,000

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 84% of cases

84%

of machines fault detected by SOPHIA Platform

33

2.5 ENHANCE DIGITAL MANUFACTURING

HSD LIGHTHOUSE PLANT

In 2021 HSD was appointed as Lighthouse Plant of the Smart Factory Cluster for the innovative Zero Defects Manufacturing project: Electrospindle 4.0 project.

The interconnected electrospindle represents a challenge in the realisation of a new generation of innovative products, and a prototype zero -defect production line (fully automated).

It is based on collecting and using data from products and production processes to detect defects at any level and thus provide optimal use and project new models.

With this new generations of products, HSD will be able to enable digital manufacturing in customer's machines.

2021 Business Plan -2023

ENABLE FUTURE DEVELOPMENT

2.6

ONE COMPANY MODEL FULLY OPERATIONAL

In 2020 and 2021 the Group carried on an organization redesign project: the One Company project.

The project main objectives are:

• Make the Group more flexible and reactive, capable of responding promptly to external stress conditions
• Simplify internal processes to speed up business decisions
• Place the Customer needs more and more at the center of business decisions.

In the plan period the new model will become fully operational, fostering the growth path from the 2022.

ONE COMPANY MODEL SERVICES Finance HR IT SUPPLY CHAIN CUSTOMER PRODUCT STRATEGY & DEVELOPMENT CORPORATE MARKETING

CSR, QUALITY & INNOVATION

Legal

-2023

Business Plan

EXPLORE ADDITIONAL GROWTH OPPORTUNITIES

The machinery industry is undergoing a process of consolidation through M&A, conducted mainly by market leaders.

In the next years Biesse Group will adopt a clearly defined approach to evaluation and, eventually, execution of potential Merger and Acquisition transactions.

The main driver for potential future M&A activities will be the product portfolio extension and market share increase.

2021 Business Plan -2023

OUR FUTURE IN FIGURES 3.

3.1 Targets 3.2 The Share

-2023

Business Plan

OVERALL TARGETS

EBITDA Margin	Net Sales	8 - 12 Net sales % % CAGR 2023e-2020
9 - 11 % 2023 Target Range	Cost of good sold	<42 Target COGS % incidence on Net Sales in 2023e
EBITDA 65 - 90
2023 Target Range €/mln	Labour & Overhead cost	<48 Target Labour & Overhead Cost % incidence on Net Sales in 2023e

NET SALES 3.1

NET REVENUE - BIESSE GROUP (€/MLN)

Organic growth only

3.1 EBITDA MARGIN

EBITDA MARGIN – BIESSE GROUP (€/MLN - %)

2021 Business Plan -2023

NET DEBT 3.1

NET FINANCIAL POSITION – BIESSE GROUP (€/MLN)

2013 2014 2015 2016 2017 2018 2019 2020 2021e 2022e 2023e

2021 Business Plan-2023

43

EBIT MARGIN - BIESSE GROUP (€/MLN - %)

2021 Business Plan -2023

CAPEX PLAN

CAPEX - BIESSE GROUP (€/MLN - %)

Main investments items in the plan period 2021-2023:

• Global Footprint evolution
• Supply Chain Digitalization
• Digital go-to-market
• Internal supplier empowerment
• HSD Lighthouse plant
• Services digitalization
• SOPHIA Evolution
• Finance digital evolution

THE SHARE

-2023

Business Plan

SHAREHOLDERS BREAKDOWN & B.o.D

Biesse Board of Directors:

• Giancarlo Selci (Founder President)
• Roberto Selci (C.E.O.)
• Massimo Potenza (co C.E.O.)
• Alessandra Baronciani
• Rossella Schiavini
• Federica Ricceri
• Ferruccio Borsani

BIESSE SHARE vs ITALIAN INDEX

BIESSE SHARE vs ITALIAN PEERS

BIESSE SHARE vs INTERNATIONAL PEERS

Disclaimer

• This presentation has been prepared independently by Biesse S.p.A. and can be used only during investors meeting. It's solely for information purposes and it may contain statements regarding future financial performances and Company's expectations
• 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. They 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 informations contained in this Document. Biesse accepts no liability for the results of any action taken on the basis of the informations 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

51