Buzzi Unicem — Investor Presentation 2020

Nov 10, 2020

Investor Roadshow Milan - 10 November 2020

Executive Summary

VOLUMES & PRICES	• Volumes: Q3 cement volumes increased in Italy and in Germany. They declined in Eastern Europe, due to the pandemic impact, and in USA, mainly to the tough comparison. For Q3 as a whole, cement volumes showed a slight trend of recovery. YTD cement volumes down (-1.8%) at 21.7 mton; ready-mix concrete volumes more impacted (-4.9%) • Prices: Favorable variance across the board in local currencies, particularly in Poland, Czech Rep and Italy
FOREIGN EXCHANGE	YTD negative impact of almost €m 22 on Net sales mainly due to weaker ruble
FINANCIALS	• Net Sales at €m 2,408 (€m 2,424 in 9M19), -0.3% like-for-like • Net debt at €m 282 versus €m 568 at year end 2019
GUIDANCE	Guidance for 2020: recurring EBITDA expected to be close to previous year
SAVINGS SHARES CONVERSION	Mandatory conversion of savings shares. • Proposed conversion rate 0.67x; • Dividend of € 0.75 per share to all shareholders subject to approval of the conversion proposal • Schedule: Meeting of the Ordinary and Savings Shareholders on 19 Nov. Closing in Feb 21, after the expiration of the withdrawal right period
ACQUISITION IN BRAZIL	The BCPAR joint venture strengthens its presence in Brazil through the acquisition of CRH group's Brazilian business (3.4 mt per year of production capacity) Agreement based on a price of USD 218 million (subjet to adj on net financial position at closing date)

Volumes 9M 2020

Price Index by country

In local currency; FY16 = 100

FX changes

	9M 20	9M 19	D	2019	Current
EUR 1 =	avg	avg	%	Avg
USD	1.13	1.12	-0.1	1.12	1.19
RUB	79.96	73.09	-9.4	72.46	92.42
UAH	29.88	29.61	-0.9	28.92	33.47
CZK	26.38	25.70	-2.7	25.67	26.67
PLN	4.42	4.30	-2.8	4.30	4.53
MXN	24.52	21.63	-13.4	21.56	24.68
BRA	5.71	4.36	-30.8	4.41	6.61

9M 20 Financial Highlights

EBITDA (€m, % of sales) Net Cash from operations (€m, % of sales)

Results by Geographic Area | Italy & United States of America

• Q3 cement volumes marked by better than expected rebound from June on. YTD volumes still down. Stronger impact on readymix production
• Favourable trend for selling prices.

• 15% of consolidated 9M net sales (16% in 9M 19)

• Some slowdown in Q3 cement vols due to the difficult comparison and Hurricane Laura in Texas, but YTD still up. Ready-mix vols weaker.

• Selling prices in local currency slightly up
• 39% of consolidated 9M net sales (38% in 9M19)

Results by Geographic Area | Central & Eastern Europe

• YTD cement vols stable in Germany, thanks to limited negative impact from Covid-19. Luxembourg still weak due to the lack of rebound during Q3. Ready-mix concrete up thanks to different scope in Germany
• Average selling prices improved

• 27% of consolidated 9M net sales (26% in 9M 19)

• Weak cement shipments in Ukraine and Poland, mainly due to the pandemic impact and slightly down in Czech Republic; ready-mix negatively impacted too

• Average selling prices in local currency improved (Poland in particular)
• 19% of consolidated 9M net sales (20% in 9M 19)

Results by Geographic Area | Mexico & Brazil (valued at equity)

• Clear development of cement volumes during Q3, thanks to the easing of restriction and social distancing. Favorable change in YTD vols
• Average selling prices in local currency stable

• Negative impact from the depreciation of the Mexican peso (-13.4%)

• YTD Cement volumes showed marked progress, thanks to solid Q3 sales.

• Positive variance of selling prices, in local currency
• Negative impact from the meaningful depreciation of the Brazilian real (-30.8%)

	9M 20	9M 19	D	D	Forex	Scope	l-f-l D
EURm			Abs	%	Abs	abs	%
Italy	367.2	382.5	(15.3)	-4.0	-	6.9	-5.8
United States	937.8	928.7	9.1	+1.0	(1.2)	-	+1.1
Germany	539.5	511.2	28.3	+5.5	-	5.7	+4.4
Lux / Netherlands	138.7	143.2	(4.5)	-3.1	-	-	-3.1
Czech Rep / Slovakia	120.1	123.1	(3.0)	-2.5	(2.7)	-	-0.3
Poland	90.4	94.8	(4.4)	-4.7	(2.5)	-	-2.0
Ukraine	88.7	98.5	(9.8)	-9.9	(0.8)	-	-9.1
Russia	152.4	167.9	(15.4)	-9.2	(14.3)	-	-0.7
Eliminations	(26.8)	(26.3)	(0.5)
Total	2,408.0	2,423.6	(15.5)	-0.6	(21.6)	12.6	-0.3
Mexico (100%)	412.5	450.8	(38.3)	-8.5	(55.1)	-	+3.7
Brazil (100%)	99.7	100.8	(1.1)	-1.1	(30.7)	-	+29.3

Net Financial Position

	Sept 20	Dec 19	∆	Sept 19
EURm			abs
Cash and other financial assets	1,133.0	840.9	292.1	706.2
Short-term debt	(47.9)	(72.2)	24.4	(144.8)
Short-term leasing	(21.6)	(22.5)	0.9	(22.0)
Net short-term cash	1,063.5	746.1	317.4	539.4
Long-term financial assets	2.3	2.9	(0.6)	3.1
Long-term debt	(1,276.3)	(1,242.1)	(34.2)	(1,181.0)
Long-term leasing	(71.2)	(74.7)	3.5	(71.7)
Net debt	(281.7)	(567.8)	286.1	(710.1)

Gross debt breakdown (1,417.0 €m )

Key points

• Sharp slowdown in Covid-19 infections during summer quarter, especially in Europe
• The rebound of industrial activity in Q3 does not cancel all the concerns arising from GDP decline and increase in unemployment.
• From Oct on, high increase in infections causing lot of unknows ahead even in the medium term
• Unfavorable development of exchange rates
• Tailwind from energy cost inflation
• USA: challenging comparison with last year
• Eastern Europe: worsening of the outlook

EBITDA 2020

Recurring EBITDA for the full year expected to be close to the level reached in 2019

Saving Shares Conversion – The Rationale

Untangle the Governance

A single class of shares, with the same rights and the same price, shall align the rights of all shareholders ("one share – one vote" rule)

More liquidity and higher market cap for common shares after conversion

Improve P/E ratio

EPS accretive transaction that should lead to an increase in the share price

Streamline and simplify the capital structure

Capital structure rationalization and simplification mean less corporate obbligations and costs associated with the existence of different class of shares

Market-friendly approach

The conversion reflects a trend that is clearly visible in the Italian market and has been often solicited by the investors

Savings Shares Conversion – Capital Structure

• Two class of shares: Ordinary and Saving shares
• Saving shares represent 19.8% of share capital
• Buzzi Family Holdings own 58.3% of ordinary shares and 48.8% of the share capital

	Share Capital
	N. of shares	%
Ordinary	165,349,149	80.2
Savings	40,711,949	19.8
Total	206,061,098	100

	Avg. daily volumes
	Avg. daily vols (Apr.20-Sept.20)	% on shares
Ordinary	626,802	0.379%
Savings	69,918	0.172%

Ordinary	3,452
Savings	480
Total	3,932

Savings Shares Conversion – Deal Structure

• Stock conversion rate: 0.67 ordinary shares for each saving share
• Equal cash payment recognised to all shareholders through a special dividend of €0.75 per share following approval of the transaction (Total cash-out of EUR 144.1 mn(1) )
• Implied premium: +22.7%
• Majority shareholders' impact: Buzzi Family holdings will land to 51.5%(1) of voting rights (from about 58%)
• Withdrawal price and threshold:
  • € 10.778 per share
  • € 25 million total

e r u ct u  r st al  e D 	(Total cash-out of EUR 144.1 mn(1) transaction ) Implied premium: +22.7% Majority shareholders' impact: Buzzi Family holdings will land to 51.5%(1) of voting rights (from about Withdrawal price and threshold:  € 10.778 per share  € 25 million total
		Implied Premium	Implied Premium (2) Adjusted
	Spot (@ 08.10.2020)	22.70%	18.46%
Last 1 month		22.70%	18.30%
Last 3 months		24.11%	19.72%
Last 6 months		24.79%	20.12%
		Market reaction
		Ordinary shares	Savings shares
	Price @ announcement	20.89	11.80
Prices	@ 12 Oct 2020	21.23	14.05
% change		+1.6%	+19.1%

Market reaction
Ordinary shares	Savings shares
20.89	11.80
21.23	14.05

(1) Assuming no withdrawal

(2) Net of special dividend

Savings Shares Conversion – The Schedule

(1) Simple majority for the approval of the deal, representing a minimum of 20% of saving shareholders capital

• operations, BCPAR becoming the 4 Southeast region (in terms of cement volumes sold)
• 2. Establish a relevant position in the Southeast: Southeast is the largest cement market in Brazil (cement consumption at c.25 mt per year) with significant potential.

1. Increase market penetration: following the acquisition of CRH's

th largest producer in Brazil and in

• 3. Entry point in Rio De Janeiro State

• 4. Interesting cost/expenses synergies

• On 26 Oct, the Brazilian Companhia Nacional de Cimento (CNC), a wholly owned subsidiary of BCPAR, company in which Buzzi Unicem holds 50% of the share capital in a joint venture with Grupo Ricardo Brennand, has signed a purchase agreement for the businesses of the CRH group operating in Brazil.

• The CRH companies operating in Brazil own three full-cycle cement plants and two grinding plants, all of them located in the South-East area of the country.
• The parties have agreed a price of US\$ 218 million, subject to adjustments based on the net financial situation at the closing date, and the contract includes the usual guarantees provided for this type of transaction.
• Buzzi Unicem intervenes in the transaction in order to ensure its success, in particular by financing CNC, on an arm's length basis, for a maximum amount equal to the expected consideration. This financial support may occur by using cash as well as credit lines already available.

• Buzzi Unicem and Grupo Ricardo Brennand have agreed on some changes to the existing shareholders' agreements, in order to consider the new scope of consolidation. However, the changes do not have significant impacts on the current structure of the pacts.

• Five production sites:

• Three integrated plants (Matozinhos, Arcos Jazida and Cantagalo)
• Two grinding stations (Arcos Cidade and Santa Luzia)
• Cement capacity: 3.4 mt per year

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), United States (# 4 cement producer), Germany (# 2 cement producer), material joint venture assets in Mexico and Brazil
• 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"

Cement plants location and capacity

2019 Consumption vs. Peak

Historical series of cement consumption by country

575

Net Cash Flow from Operations and Capex | €m

% Net cash flow from operations / Net sales

% Ordinary capex / Net sales

Historical EBITDA development by country

			2011	2012	2013	2014	2015	2016	2017	2018	2019
	Italy	EBITDA	10,3	-5,9	-18,1	-18,7	-37,2	-22,2	-79,7	-1,7	43,4
		margin	1,8%	-1,2%	-4,2%	-4,8%	-9,8%	-5,9%	-18,6%	-0,4%	8,6%
	Germany	EBITDA	90,3	72,2	108,1	88,6	72,1	76,8	78,1	82,5	102,3
		margin	14,2%	12,0%	18,0%	14,7%	12,6%	13,4%	13,3%	13,0%	15,1%
	Lux/	EBITDA	35,0	8,3	11,5	15,9	19,7	25,8	17,6	23,1	22,7
	Netherlands	margin	15,7%	4,3%	6,3%	9,7%	11,7%	14,7%	9,4%	11,7%	11,8%
	Czech Rep/	EBITDA	35,2	25,4	19,2	27,0	32,6	34,4	36,5	43,6	46,3
	Slovakia	margin	20,5%	17,0%	14,6%	20,2%	24,0%	25,2%	24,7%	26,5%	27,5%
	Poland	EBITDA	36,9	21,8	27,1	18,2	22,7	23,4	24,1	31,9	32,1
	Ukraine	margin	26,6%	20,0%	26,8%	20,4%	20,4%	24,6%	24,9%	28,6%	25,9%
		EBITDA	6,9	15,8	12,3	11,0	4,0	12,8	16,0	7,0	21,0
		margin	6,2%	11,8%	10,0%	12,5%	5,7%	16,1%	16,9%	8,0%	15,9%
	Russia	EBITDA	65,7	96,1	92,6	73,4	48,4	43,2	46,0	50,1	57,7
		margin	37,4%	41,0%	37,2%	35,0%	29,0%	28,0%	24,9%	27,0%	26,9%
	USA	EBITDA	71,4	123,9	151,0	207,3	311,7	356,5	369,6	341,2	402,7
		margin	12,8%	18,2%	20,7%	24,2%	28,1%	31,9%	33,0%	31,9%	32,4%
	Mexico	EBITDA	82,6	97,5	77,5	Adoption of
		margin	34,7%	36,2%	33,2%	IFRS 11
		EBITDA	434,3	455,1	481,2	422,7	473,2	550,6	508,2	577,2	728,1
	Group	margin	15,6%	16,2%	17,5%	16,9%	17,8%	20,6%	18,1%	20,1%	22,6%

Investor Roadshow

Milan - 10 November 2020