Buzzi Unicem — Investor Presentation 2015

Nov 17, 2015

Investor Roadshow

Frankfurt – 17 November 2015

Executive summary

Volumes

• Cement up 1.0% in Q3 and 1.3% YTD (-2.6% in Q3 and flat YTD net of Korkino scope change). Ready-mix concrete down 2.3% YTD
• Italy: unfavorable Q3 (cement -8.4%), affected by weak domestic shipments (-11.8%); YTD cement is lower than previous year (-2.6%) and ready-mix flat (+0.5%)
• United States: progress maintained in Q3 (cement +3.1%) and YTD (cement +2.9%) with Texas down 1.1% and other regions up 3.9%
• Central Europe: cement sales in Q3 (-3.9%) and YTD (-4.9%) unable to rebount; ready-mix concrete showing signs of recovery only in the Netherlands (YTD +19.4%)
• Eastern Europe: poor shipments like-for-like in Q3, mainly due to Russia (-18.5%); favorable YTD variance achieved in Czech Republic and notably in Poland
• Prices
• Sound increase in USA and Ukraine (local currency); no variance in Germany; marginal weakness in Luxembourg, Czech Republic and Russia; prices dropping in Poland and Italy, where Q3 showed an energizing effect
• Foreign Exchange
• Positive impact on sales (€m 63.7) and Ebitda (€m 20.4), due to stronger dollar offsetting a much weaker ruble and hryvnia
• Costs
• High inflation in Ukraine, but elsewhere power and fuel continue to trend lower
• Results
• Revenues at €m 1,998.1 versus €m 1,898.7 (+5.2%)
• EBITDA at €m 352.1 (recurring €m 355.2) versus €m 302.5 (recurring €m 307.2)
• Outlook unchanged for financial year 2015

Volumes

Cement volumes and prices

Price trends by country

In local currency; FY12 = 100

FX changes

	9 M 1 5	9 M 1 4	∆
E U R 1 =	a g v	a g v	%
U S D	1. 1 1	1. 3 6	1 8 7 +
R U B	6 6 6 0	4 8 0 2	3 8 7 -
U A H	2 4 0 1	1 5 1 5	8 5 5 -
C Z K	2 7 3 5	2 7 5 0	0 5 +
P L N	4 1 6	4 1 8	0 4 +
M X N	1 3 7 7	1 7 7 7	2 3 +

Net sales by country

	9 M 1 5	9 M 1 4	∆	∆	F o r e x	S c o p e	f- l- l ∆
E U R m			b a s	%	b a s	b a s	%
I l t a y	2 8 2 8	2 9 4 7	( 1 1. 9 )	4 0 -	-	-	4. 0 -
S U i t d t t n e a e s	8 2 3 5	6 1 9 0	2 0 4 5	3 3 0 +	1 6. 2 4	-	9. 4 +
G e r m a n y	4 2 9 8	4 6 6 3	( 3 6 6 )	7 8 -	-	-	-7 8
L b u x e m o u r g	2 7 7	8 0 7	( 3 ) 5	4 4 -	-	-	4. 4 -
N h l d t e e r a n s	4 8 5	4 2 7	5 8	1 3 6 +	-	-	1 3. 6 +
C h R / S l k i z e c e p o v a a	1 0 0 8	1 0 0 1	0 8	0 8 +	0. 5	-	0. 3 +
P l d o a n	7 6 2	6 8 1	8 1	1 1. 9 +	0. 3	-	1 1. 4 +
U k i r a n e	5 2 4	7 1. 9	( 1 9 5 )	2 7 2 -	( 3 0. 6 )	-	1 5. 4 +
R i u s s a	1 3 6 2	1 6 2 7	( 4 0 0 )	2 2 7 -	( ) 5 2. 7	2 5. 7	-7 4
E l i i t i m n a o n s	( 2 9. 1 )	( 2 0. 9 )	( 8. 3 )
T l t o a	1, 9 9 8 1	1, 8 9 8 7	9 9 4	5 2 +	6 3. 7	2 5. 7	0. 5 +
M i ( 1 0 0 % ) e x c o	4 2 7 5	3 6 8 7	9 8 4	2 6 1 +	4 5.	-	2 3. 2 +

EBITDA by country

	9 M 1 5	9 M 1 4	∆	∆	F o r e x	S c o p e	l- f- l ∆
E U R m			b a s	%	b a s	b a s	%
I l t a y	( 1 9 ) 7	( 9 0 )	( 1 0 ) 7	1 0 0 >	-	-	1 0 0 >
U i d S t t t n e a e s	2 1 6 2	1 3 5 2	8 1. 0	6 0 0 +	3 8. 4	-	3 1. 6 +
G e r m a n y	2 6 5	2 5 7	( 0 1 )	0 2 -	-	-	0. 2 -
L b u x e m o u r g	1 1. 6	1 3 0	( 1. 5 )	1 1. 2 -	-	-	1 1. 2 -
N h l d t e e r a n s	1. 6	( 0 ) 7	2 3	1 0 0 >	-	-	1 0 0 >
C h R / S l k i e c e p o a a z v	2 4 7	1 9 2	4 5	2 8 3 +	0. 1	-	2 7. 6 +
P l d o a n	2 0 3	1 5 5	4 8	3 1. 1 +	0. 1	-	3 0. 6 +
U k i r a n e	4 3	1 1. 8	( ) 7 5	6 3 9 -	( 2. ) 5	-	4 2. 8 -
R i u s s a	4 0 5	6 4 8	( 2 4 3 )	3 7 5 -	( 1 7 ) 5.	2. 9	1 7. 8 -
T t l o a i r e c u r r n g	3 5 2 1 3 5 5. 2	3 0 2 5 3 0 7. 2	4 9 5 4 8. 1	1 6 4 + 1 5. 6 +	2 0. 4 2 0. 8	2. 9 2. 9	8. 7 + 8. 0 +
M i ( 1 0 0 % ) e x c o	1 9 8 5	1 3 8 4	5 7 4	1. 4 5 +	2. 2	-	3 8. 2 +

Net sales and EBITDA development

• In 9M 15 USA accounts for 3/5 of the total EBITDA
• Decreasing contribution from emerging markets, from 38% to 25% of EBITDA in 9M 15 vs 9M 14 due to forex and economic troubles

EBITDA variance analysis

Consolidated Income Statement

	9 M 1 5	9 M 1 4	∆	∆
E U R m			b a s	%
N S l t e a e s	1, 9 9 8 1	1, 8 9 8 7	9 9 4	2 5 +
O t i h f l p e r a n g c a s o w ( E B I T D A )	3 5 2 1	3 0 2 5	4 9 5	1 6 4 +
f h i h, i o w c n o n r e c u r r n g % f l ( i ) o s a e s r e c u r r n g	( 3. 2 ) 1 7. 8 %	( 4. 6 ) 1 6. 2 %
D i i d i i t t t e p r e c a o n a n a m o r z a o n	( 1 4 5 2 )	( 1 6 6 5 )	2 1. 3
O i f i t t p e r a n g p r o ( E B I T )	2 0 6 9	1 3 6 1	0 8 7
% f l o s a e s	1 0. 4 %	7. 2 %
E i t i q u y e a r n n g s	5 5 7	3 6 4	1 9 3
f N t i t e n a n c e c o s	( ) 8 3 7	( ) 5 0 7	( ) 3 3 0
P f i b f t t r o e o r e a x	1 8 9 7	1 2 1. 8	1 5 7
I t n c o m e a x e x p e n s e	( 8 6 ) 5	( 6 6 ) 4	8 7
N f i t t e p r o	1 2 0 3	4 5 5	6 4 9
M i i t i n o r e s	( 2 7 )	( 3 9 )	1. 3
C f l i d t d t i t o n s o a e n e p r o	1 1 7 6	5 1. 4	6 6 2
C h f l ( 1 ) a s o w	2 6 5 5	2 2 1. 8	4 3 7	1 9 7 +

(1) Net Profit + amortization & depreciation

Consolidated Cash Flow Statement

	9 M 1 5	9 M 1 4	2 0 1 4
E U R m
C h d f i t t a s g e n e r a e r o m o p e r a o n s	3 0 8 2	2 6 6 6	3 9 0 7
% f l o s a e s	1 5. 4 %	1 4. 0 %	1 5. 6 %
I i d t t n e r e s p a	( 4 9 5 )	( 5 5 5 )	( 8 7 2 )
I t i d n c o m e a x p a	( ) 4 2 9	( ) 2 6 2	( ) 5 8 9
N t h b t i t i i t i e c a s y o p e r a n g a c v e s	2 1 5 8	1 8 4 9	2 4 4 6
% f l o s a e s	1 0. 8 %	9. 7 %	9. 8 %
C i l d i 1 ) t t a p a e p e n r e s x u	( 2 2 8 ) 5	( 1 2 6 ) 5	( 1 8 ) 7 7
E i t i t t q u y n v e s m e n s	( ) 0 1	( ) 2 3 5	( ) 1 3 6 8
D i i d d i d v e n s p a	( 1 1. 3 )	( 1 2 1 )	( 1 1. 9 )
D i i d d f i t e n s r o m a s s o c a e s v	2 3 5	2 2 1	4 0 3
D i l f f i d d i t t t s p o s a o x e a s s e s a n n v e s m e n s	1 7 6	3 0 1	5 8 6
f f T l t i d i d d i t i r a n s a o n e r e n c e s a n e r v a v e s	( ) 2 3 0	8 5	0 9
A d i b l t t c c r e n e r e s p a a e u y	( 7 6 )	( 7 0 )	2 4
I i d t t n e r e s r e c e e v	4 7	8 7	1 1. 0
O t h e r	( ) 5 0	1. 6	3 1
C h i t d b t a n g e n n e e	( 1 1. 2 )	8 6 7	3 4 5
f ( f ) N t i i l i t i d i d e n a n c a p o s o n e n o p e r o	( 1, 0 3 9 ) 7	( 1, 0 1 0 ) 5	( 1, 0 6 2 ) 7

1) of which expansion projects 125.5 in 2015 and 34.4 in 2014

Net Financial Position

	S 1 5 e p	D 1 4 e c	∆	S 1 4 e p
E U R m			b a s
C h d h f i i l t t a s a n o e r n a n c a a s s e s	3 9 0 4	4 2 1. 7	( 3 1. 4 )	1. 9 5 5
S h d b t- t t o r e r m e	( 2 1 8 ) 7	( 1 ) 7 5 5	( 4 3 2 )	( 2 0 4 ) 5
N t h t- t h e s o r e r m c a s	1 7 1. 7	2 4 6 3	( 4 6 ) 7	3 4 6 5
L f i i l t t o n g e r m n a n c a a s s e s -	1 5 9	1 7 3	1. 3	1 1. 2
L d b t t o n g e r m e -	( 1, 2 6 1. ) 5	( 1, 3 2 6 3 )	6 4 8	( 1, 3 6 8 2 )
N d b t t e e	( 1, 0 3 9 ) 7	( 1, 0 6 2 ) 7	( 1 1. 2 )	( 1, 0 1 0 ) 5

Gross debt breakdown (€m 1,480.2)

pag ¹² Investor Roadshow | November 17, 2015

Debt maturity profile

• Total debt and borrowings stood at €m 1,413 at September 2015
• As at September 2015 available €m 448m of undrawn committed facilities (€m 400m for Buzzi Unicem, €m 48 for Dyckerhoff)

Industrial capex

In the period 2007-2014 equal to €m 2,992, of which €m 1,010 for expansion projects *

Expansion capex

Maryneal, Texas – USA

• To be completed in 1H 2016
• New line with a capacity of 1.2m tons per year (versus 0.6m currently)
• Total cost: \$m 260
• Aimed at capturing the demand growth of Texas in oil and gas, residential and infrastructure
• Cost saving thanks to increased efficiency and environmental footprint reduction

Apazapan, Veracruz - Mexico

• To be completed in 1Q 2017
• Second line with a capacity of 1.3m tons per year, to double the current 1.3m
• Aimed at preserving market share in a growing consumption trend
• Total cost: \$m 200

Recent strategic move: new offer addressed to Sacci 1/3

• RATIONALE 4-

• 1- Active role in the consolidation process of the domestic industry

• 3- Domestic consumption at extremely low level (trough?) with chances to rebound 2- Easier to adjust production capacity in a less fragmented market

• Operating leverage thanks to greater capacity utilization

  • 5-Gradual recovery of profitability in Italy

• Major player of the country, operating in the central and northern regions

• Market share estimated at 6%; adequate vertical integration in ready-mix concrete
• About 1.3 m ton cement sales in 2014
• Filed for composition with creditors at the beginning of May

Recent strategic move: new offer addressed to Sacci 2/3

• Buzzi Unicem submitted to SACCI a binding offer to acquire its cement and readymix concrete business units, under the composition plan opened last May
• The offer provides for the purchase of 5 cement plants (Cagnano Amiterno, Castelraimondo, Tavernola Bergamasca, Greve in Chianti and Livorno), 3 terminals currently idle (Manfredonia, Ravenna and Vasto) and 27 ready-mix concrete plants, mainly located in central Italy
• It does not include minority interests in Cementerie Aldo Barbetti (35%) and Cementi Costantinopoli (40%)
• The offer will be valid and binding until 31 March 2016, provided that SACCI incorporates it as an integral part in its application for composition to the Court of Rome
• The provisional financial commitment amounts to €m 74, plus earn-out clause according to Ebitda achieved in Italy over the next four years (in any case no less than €m 25)

pag¹⁷

Recent strategic move: new offer addressed to Sacci 3/3

Appendix

Buzzi Unicem at a Glance

• International multi-regional, "heavy-side" group, focused on cement, ready-mix and aggregates
• Dedicated management with a long-term vision of the business
• Highly efficient, low cost producer with strong and stable cash flows
• Successful geographic diversification with leading positions in attractive markets
• Italy (# 2 cement producer), US (# 4 cement producer), Germany (# 2 cement producer), joint venture in Mexico (# 4 cement producer)
• Significant positions in Luxembourg, The Netherlands, Poland, Czech Republic, Slovakia, Russia and Ukraine, as well as entry point in Slovenia and Algeria
• High quality and environmentally friendly assets
• Leading product and service offering
• Conservative financial profile and balanced growth strategy

"Value creation through lasting, experienced know-how and operating efficiency"

Ownership structure

Cement plants location and capacity

2014 Consumption vs. Peak

Historical series of cement consumption by country

Historical EBITDA development by country

EU Rm			20 07	20 08	20 09	20 10	20 11	20 12	20 13	20 14
	Ita ly	EB ITD A	20 6.4	143 .4	92 .7	32 .5	10 .3	-5. 9	-18 .1	-18 .7
		in ma rg	21 .5%	16. 9%	13. 1%	5.3 %	1.8 %	-1. 2%	-4. 2%	-4. 8%
	Ge rm an y	EB ITD A	138 .9	102 .7	116 .3	76 .3	90 .3	72 .2	108 .1	88 .6
		in ma rg	27 .0%	17. 3%	22 .0%	13. 9%	14. 2%	12. 0%	18. 0%	14. 7%
	Lu mb	EB ITD A	21 .5	17 .4	14 .1	16 .4	33 .4	13 .8	19 .7	17 .8
	xe ou rg	in ma rg	23 .5%	19. 5%	0% 17.	7% 17.	.6% 29	13. 3%	18. 1%	16. 8%
	Ne the rla nd	EB ITD A	8.1	7.2	4.5	0.6	1.6	-5. 5	-8. 2	-1. 9
	s	in ma rg	% 5.8	% 5.4	4.0 %	0.5 %	1.4 %	-6. 3%	-11 .3%	3% -3.
	Cz h R ec ep	EB ITD A	70 .3	73 .2	44 .2	32 .8	35 .2	25 .4	19 .2	27 .0
		in ma rg	32 .6%	28 .1%	25 .2%	20 .5%	20 .5%	17. 0%	14. 6%	20 .2% 18 .2 .1 20 .4% .3 11 .0 12. 5% .6 73 .4 35 .0% 20 7.3 24 .2% .5 Ad tio f op n o S 1 IFR 1 42 2.7 16 .9%
	Po lan d	EB ITD A	52 .1	70 .0	31 .2	33 .4	36 .9	21 .8	27
		in ma rg	36 .5%	38 .1%	25 .7%	25 .8%	26 .6%	20 .0%	26 .8%
	Uk rai ne	EB ITD A	58 .1	49 .9	-4. 5	-10 .5	6.9	15 .8	12
		in ma rg	32 .4%	23 .8%	-6. 0%	-12 .8%	6.2 %	11. 8%	10. 0%
	Ru ia	EB ITD A	94 .7	173 .2	42 .1	39 .7	65 .7	96 .1	92
	ss	in ma rg	47 .9%	64 .8%	42 .6%	32 .0%	37 .4%	41 .0%	37 .2%
	US A	EB ITD A	304 .1	20 5.8	13 1.3	88 .7	71 .4	123 .9	15 1.0
		in ma rg	35 .7%	27 .4%	21 .4%	14. 8%	12. 8%	18. 2%	20 .7%
	Me xic o	EB ITD A	91 .9	79 .9	69 .9	.2 77	82 .6	97 .5	77
		.4% .9% in 43 38 ma rg 38 .7%	36 .2%	34 .7%	.2% 36	.2% 33
		EB ITD A	104 6.3	92 2.7	54 1.7	38 7.0	43 4.3	45 5.1	48 1.2
	Gr ou p	in ma rg	29 .9%	26 .2%	.3% 20	14 .6%	15 .6%	16 .2%	17 .5%