Continental AG — Investor Presentation 2016

Aug 3, 2016

H1 2016 Results

Hanover – August 3, 2016

Ticker: CON ADR-Ticker: CTTAY Twitter: @Continental_IR

http://www.continental-ir.com Wolfgang Schaefer – CFO

AGENDA

1	Corporation Highlights	3
2	Automotive Group	11
3	Rubber Group	13
4	Indebtedness and Cash Flow	16
5	Outlook 2016	19
6	Back-up and Fact Sheets 2014 – 2016	28

1) Corporation Highlights Most Important KPIs for H1 2016

• › Sales up by 2% to €20 bn; organic sales growth at 4%; FX negative at €564 mn
• › Adj. EBIT¹ up by 7% to €2.4 bn; adj. EBIT¹ margin at 12.1% (PPA -€69 mn and special effects -€23 mn)
• › NIAT² up by 13% to €1.6 bn
• › Free cash flow amounted to €959 mn including €82 mn cash outflow for acquisitions; free cash flow before acquisitions amounted to €1,041 mn
• › Gearing ratio down to 26%; equity ratio at 39%
• › Value creation: trailing ROCE³ up by 90 bps to 21.2% YOY

Other topics:

• › Renesas situation impacted organic sales growth in Automotive negatively by about 1%; revenues will gradually recover in H2 2016
• › Order intake in the Automotive Group up to more than €18 bn
• › S&P rating upgrade to BBB+ outlook stable on May 11, 2016

³ Trailing ROCE is calculated as reported EBIT for the last twelve months (LTM) divided by average operating assets for the LTM

¹ Before amortization of intangibles from PPA, consolidation and special effects

² Attributable to the shareholders of the parent

1) Corporation Highlights Divisional Highlights in H1 2016

Automotive Group

Rubber Group

› Chassis & Safety: Adj. EBIT¹ margin at 9.9% (Q2 16: 10.0%); organic sales up by 6% (Q2 16: 8%); ADAS unit sales up by 45% in H1 2016; solid order intake in VED and ADAS

› Powertrain: Adj. EBIT¹ margin at 5.2% (Q2 16: 6.4%); organic sales up by 2% (Q2 16: 4%); adj. EBIT¹ margin before HEV at 8% in Q2 16

› Interior: Adj. EBIT¹ margin at 8.8% (Q2 16: 9.1%); organic sales increased by 3% (Q2 16: 4%); muted organic sales growth and margin decline explained by several ramp ups and the Renesas situation in Japan

› Automotive Group: Organic sales increased by 4% (Q2 16: 5%), worldwide car production up by 2% (Q2 16: 2%); adj. EBIT¹ margin down by 70 bps to 8.1% (Q2 16: 8.6%); R&D expense up by €158 mn (14%)

› Order intake in the Automotive Group increased to more than €18 bn

› Tires: Adj. EBIT¹ margin increased by 180 bps to 22.8% benefitting from lower raw material costs totaling €100 mn in H1 2016, solid price mix (-2%); volumes were up by 8% in H1 2016; FX impacted tire sales negatively by 4% in H1 2016

• › Tire markets: PC & LT tire replacement demand in Europe was up by 2%; NAFTA was up by 2%
• › ContiTech: Adj. EBIT¹ margin increased by 300 bps to 10.8% in H1 2016; organic sales up by 2% in H1 2016

› Rubber Group: Organic sales up by 5% (Q2 16: 4%) and adj. EBIT¹ margin up to 18.8% (Q2 16: 19.8%)

1) Corporation Highlights Selected Press Clippings Released in H1 2016

Multi Function Mono Continental wins Toyota's T&D award for Camera with Lidar ADAS technology, already installed in 10 Toyota models

A recognition of Continental's development contribution towards Toyota's active safety package "Toyota Safety Sense C". It combines innovative safety technologies Pre-Collision System (PCS), Lane Departure Alert (LDA), and Auto High Beams (AHB) to help assist the driver.

Go to press release

VW Tiguan runs AEB on Continental radar sensor only

Thanks to its wide field of view it not only detects other vehicles, but even pedestrians for the first time. Ranging up to 170 meters and even in adverse weather conditions. Automatic braking is initiated if necessary - this sensor is now standard in the new VW Tiguan. Go to press release

MK C1 Brake debuts in the new Alfa Romeo Giulia

The innovative electronic brake system integrates the brake actuation, brake booster and control systems (ABS and ESC) into a compact, weight-saving braking module that weighs up to 4 kg less than a conventional system. It also fulfills increased pressure dynamics requirements for new ADAS functions. Go to press release MK C1

Driver HMI: gesture-based controls

Control at your fingertips while your hands remain safely on the steering wheel: A quick swipe with the thumb, a light wave with the hand to accept an incoming call, activate the required driving mode, or start your favorite song. Go to press release

Turbochargers: RAAX™ technology to debut in Audi A3

RAAX™ technology results in up to 3 percent greater efficiency in the engine relevant operating range, leading to reduced emissions. In addition the turbo lag is minimized which results in a significant improvement in response.

RAAX™Turbine Wheel

Go to press release

€50mn invest into radial agricultural tire production

Continental is back to the agricultural tire sector as a premium manufacturer. Intending to bring a complete tire portfolio for agricultural tractors and harvesting machines to the market. The range will include radial and cross-ply tires in 150 sizes. SoP is planned for 2017.

Go to press release

Continental partners with U.S. Department of Transportation for Smarter Cities Challenge

• › Continental pledges initial investment of at least \$1 million towards the development and deployment of Intelligent Intersection Systems
• › Winner will be the country's first city to fully integrate innovative technologies into their transportation network
• › As part of its commitment, Continental will provide advanced sensing, vehicle-to-vehicle and vehicle-to-infrastructure (V2X) communication technology

Go to press release

1) Corporation Highlights Sales and Adjusted EBIT¹ by Quarter

¹ Before amortization of intangibles from PPA, consolidation and special effects

1) Corporation Highlights Automotive Group and Rubber Group by Quarter

1) Corporation Highlights Growth Profile of the Corporation H1 2016

1) Corporation Highlights Sustainable Value Creation

2 Trailing ROCE is calculated as reported EBIT for the last twelve months divided by trailing operating assets

1

1) Corporation Highlights

Maturities for Syndicated Loan and Bonds¹ (mn €)

As at June 30, 2016

(mn €)	FY 15	H1 16
Gross indebtedness	5,245	5,230
Cash	1,622	1,720
Net indebtedness	3,542	3,446
Available credit lines	3,612	3,545

¹ All amounts shown are nominal values

² Any utilization under the Revolving Credit Facility (RCF) has to be shown as short term debt acc. to IFRS although the RCF matures in 2021. It has a total volume of €3,000 mn

2) Automotive Group Sales and Adj. EBIT¹by Division

Reported change in sales

• › Chassis & Safety: 4.0%
• › Powertrain: 0.2%
• › Interior: 2.2%
• › Automotive Group: 2.2%

¹ Before amortization of intangibles from PPA, consolidation and special effects

(mn €) H1 2016

• › Reported EBITDA: €1,465 mn (12.0% of sales)
• › Reported EBIT: €942 mn (7.7% of sales)
• › R&D: €1,259 mn (10.3% of sales)
• › Capex: €497 mn (4.1% of sales)

2) Automotive Group Q2 2016: Adj. EBIT¹ Impacted by High R&D Expenses

• › Sales increased by €161 mn; organic sales growth in Q2 2016 at 5.1% negatively impacted by the Renesas situation in Japan
• › Adj. EBIT¹ decreased by €19 mn mainly because of high R&D costs for new car programs
• › Adj. EBIT¹ margin at 8.6% (PY: 9.1%)

3) Rubber Group Sales and Adj. EBIT¹by Division

Reported change in sales

›	ContiTech:	1.8%
›	Tires:	2.8%
›	Rubber Group:	2.4%

• › Reported EBIT: €1,401 mn (17.7% of sales)
• › R&D: €184 mn (2.3% of sales)
• › Capex: €422 mn (5.3% of sales)

3) Rubber Group

Q2: Strong Volume Growth in Tires; Stabilization of Industry Business

• › Sales remained unchanged; strong volume growth in tires and the stabilization of the industry business in ContiTech were not able to offset negative FX effects; mining business remains subdued
• › Tire volumes increased by 8%; FX had a negative effect of ~4% on tire sales in Q2 2016 while price mix stood at -2%
• › Adj. EBIT¹ increased by €67 mn supported by ~50 mn positive effect from lower raw material prices

3) Rubber Group

Expected Raw Material Price Development in 2016

• › Natural rubber price (TSR 20) expected to average U.S. \$1.40 in 2016 (down from prior forecast of U.S. \$1.50)
• › Synthetic rubber price (butadiene feedstock) forecasted to average U.S. \$1.00 in 2016 (up from prior forecast of U.S. \$0.90)
• › Tailwind from lower raw material cost to amount to about €150 mn in 2016 (up €50 mn from prior forecast)

¹ Source: Bloomberg and Continental estimates for 2016

4) Indebtedness and Cash Flow Net Indebtedness Bridge (mn €)

4) Indebtedness and Cash Flow Cash Flow Overview

4) Indebtedness and Cash Flow Net Indebtedness and Gearing Ratio

Net indebtedness (mn €) Gearing ratio

5) Outlook 2016 PC & LT Production by Quarter

Source: IHS and own estimates, Europe excluding Kazakhstan and Uzbekistan

H1 2016 Results – August 3, 2016 EDMR – Equity and Debt Markets Relations 19

5) Outlook 2016 Market Outlook for Major Regions in 2016

87.0

Asia

1,655

Asia

¹ Passenger car and light truck <6t

² Heavy vehicles >6t

³ Passenger car & light truck replacement

⁴ Commercial vehicle replacement (radial and biased)

H1 2016 Results – August 3, 2016

5) Outlook 2016 Continental Corporation

	2015	2016E
Consolidated sales	€39.2 bn	To increase to ~€41 bn at constant FX rates
adj. EBIT1	€4.5 bn	>11%
Automotive Group	€23.6 bn	~€25 bn
adj. EBIT1	€2.1 bn	>8.5%
Rubber Group	€15.7 bn	>€16 bn
adj. EBIT1	€2.5 bn	>17%
Raw material cost	Relief of about	Raw materials to positively affect Rubber Group
impact	€250 mn	results in 2016 by about €150 mn
Special effects	-€116 mn	About -€100 mn
Net interest result	-€246 mn	<-€250 mn
Tax rate	28.2%	<30%
Capex	€2.2 bn	Capex at around 6% of sales
PPA	€138 mn	PPA amortization: ~€150 mn
Free cash flow before acquisitions	€2.7 bn	At least €2 bn

¹ Before amortization of intangibles from PPA, consolidation (2015 in comparison to 2014) and special effects

Thank you!

Disclaimer

• › This presentation has been prepared by Continental Aktiengesellschaft solely in connection with the release of the H1 2016 results on August 3, 2016, in Hanover. It has not been independently verified. It does not constitute an offer, invitation or recommendation to purchase or subscribe for any shares or other securities issued by Continental AG or any subsidiary and neither shall any part of it form the basis of, or be relied upon in connection with, any contract or commitment concerning the purchase or sale of such shares or other securities whatsoever.
• › Neither Continental Aktiengesellschaft nor any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss that may arise from any use of this presentation or its contents or otherwise arising in connection with this presentation.
• › This presentation includes assumptions, estimates, forecasts and other forward-looking statements, including statements about our beliefs and expectations regarding future developments as well as their effect on the results of Continental. These statements are based on plans, estimates and projections as they are currently available to the management of Continental. Therefore, these statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. Furthermore, although the management is of the opinion that these statements, and their underlying beliefs and expectations, are realistic as of the date they are made, no guarantee can be given that the expected developments and effects will actually occur. Many factors may cause the actual development to be materially different from the expectations expressed here. Such factors include, for example and without limitation, changes in general economic and business conditions, fluctuations in currency exchange rates or interest rates, the introduction of competing products, the lack of acceptance for new products or services and changes in business strategy.
• › All statements with regard to markets or market position(s) of Continental or any of its competitors are estimates of Continental based on data available to Continental. Such data are neither comprehensive nor independently verified. Consequently, the data used are not adequate for and the statements based on such data are not meant to be an accurate or proper definition of regional and/or product markets or market shares of Continental and any of the participants in any market.
• › Unless otherwise stated, all amounts are shown in millions of euro. Please note that differences may arise as a result of the use of rounded amounts and percentages.

Contact Equity and Debt Markets Relations

Vahrenwalder Str. 9 30165 Hanover Germany e-mail: ir@conti.de www.continental-ir.com

Rolf Woller

Head of IR Phone: +49 511 938 1068 e-mail: rolf.woller@conti.de

Ingrid Kampf

Assistant to the Head of IR Roadshow and Conference Organization Phone: +49 511 938 1163 Fax: +49 511 938 1080 e-mail: ingrid.kampf@conti.de

Michael Saemann

Analysts, Institutional Investors and Sustainability Investors Phone: +49 511 938 1307 e-mail: michael.saemann@conti.de

Klaus Paesler

Analysts, Institutional Investors, ADR and Private Investors Phone: +49 511 938 1316 e-mail: klaus.paesler@conti.de

Sabine Reese

Sustainability, ASM, CMD Organization, IR Website, Capital Market Disclosure Requirements Phone: +49 511 938 1027 e-mail: sabine.reese@conti.de

Henry Schniewind Analysts, Institutional Investors Phone: +49 511 938 1062 e-mail: henry.schniewind@conti.de

Marvin Kalberlah Social Media Phone: +49 511 938 14034 e-mail: marvin.kalberlah@conti.de

Continental Financial Calendar

2016

Preliminary figures for fiscal 2015	January 11, 2016
Annual Financial Press Conference	March 3, 2016
Annual Shareholders' Meeting (incl. key data for Q1 2016)	April 29, 2016
Q1 Financial Report	May 4, 2016
Half Year Financial Report	August 3, 2016
Nine Month Financial Report	November 10, 2016

Preliminary figures for fiscal 2016	January 2017
Annual Financial Press Conference	March 2017
Annual Shareholders' Meeting (incl. key data for Q1 2017)	April 28, 2017
Q1 Financial Report	May 2017
Half Year Financial Report	August 2017
Nine Month Financial Report	November 2017

Continental Share Data / ADR Data

Share Data

Type of share	No-par value share
Bloomberg Ticker	CON
Reuters Ticker	CONG
German Security Identification Number (WKN)	543 900
ISIN Number	DE0005439004
Shares outstanding as at June 30, 2016	200,005,983

ADR Data

Ratio (ordinary share: ADR)	1:5
Bloomberg Ticker	CTTAY
Reuters Ticker	CTTAY.PK
ISIN Number	US2107712000
ADR Level	Level 1
Exchange	OTC
Sponsor	Deutsche Bank Trust Company Americas

Continental Bond Data

Issuer	Conti-Gummi Finance B.V., Netherlands1	Continental AG	Continental AG	Continental Rubber of America, Corp.1
Issue	Senior Notes	Senior Notes	Senior Notes	Senior Notes
Principal amount	€750 mn	€750 mn	€750 mn	€500 mn
Offering price	99.595%	98.950%	99.228%	99.739%
Rating at issuance date	4 Ba1 (Moody's ) BB (S&P) BBB (Fitch2 )	4 Ba2 (Moody's ) BB (S&P) BB (Fitch2 )	4 Ba1 (Moody's ) BB (S&P) BBB (Fitch2 )	BBB (S&P) BBB (Fitch)
Current corporation and bond ratings3	BBB (Fitch),	BBB+ (S&P), Baa1 (Moody's4	)
Coupon	2.5% p.a.	3.0% p.a.	3.125% p.a.	0.5% p.a.
Issue date	September 19, 2013	July 16, 2013	September 9, 2013	November 19, 2015
Maturity	March 20, 2017	July 16, 2018	September 9, 2020	February 19, 2019
Interest payment	Annual March 20	Semi annual January 16/July 16	Annual September 9	Annual February 19, commencing on February 20, 2017
WKN	A1VC6B	A1X24V	A1X3B7	A1Z7C3
ISIN	XS0972719412	XS0953199634	XS0969344083	DE000A1Z7C39
Denomination	€1,000 with min. tradable amount €1,000	€1,000 with min. tradable amount €1,000	€1,000 with min. tradable amount €1,000	€1,000 with min. tradable amount €1,000

¹ Guaranteed by Continental AG

² Non-contracted rating at date of issuance

3 Fitch since July 15, 2013; S&P since May 11, 2016; Moody's since June 30, 2015

⁴ Non-contracted rating since February 1, 2014

Back-up

Corporation Highlights H1 2016

› Sales	Increase of 2.3% to €20,041.7 mn (PY: €19,598.6 mn); organic sales up 4.1%
› EBITDA	Increase of 6.0% to €3,218.6 mn (PY: €3,036.5 mn)
› EBIT	Increase of 6.0% to €2,290.3 mn (PY: €2,161.2 mn); Adj. EBIT1 increase to €2,398.0 mn (12.1% adj. EBIT1 margin); PPA2 effect -€68.9 mn; total special effects -€22.6 mn
› NIAT3	Increase of 13.1% to €1,638.8 mn (PY: €1,448.6 mn)
› EPS3	EPS of €8.19 (PY: €7.24) EPS before PPA2 before PPA2 €8.44 (PY: €7.48 )
› Capex	Capex increased to €919.9 mn (PY: €815.8 mn); capex ratio 4.6% of sales; capex to depreciation coverage 1.0x (1.1x ex PPA2 )
› R&D	Expenses for research and development increased by 13.2% to €1,442.9 mn (PY: €1,274.3 mn); R&D ratio 7.2% of sales (PY: 6.5%)
› Cash flow	Operating cash flow up by €268.1 mn to €1,981.9 mn; free cash flow €959.0 mn
› Net debt	Net indebtedness down by €95.7 mn to €3,446.2 mn vs. FY 2015; Liquidity and undrawn credit lines amounted to €5,265.5 mn

¹ Before amortization of intangibles from PPA, consolidation and special effects

² Amortization of intangibles from PPA, tax rate of 28% applied for EPS calculation

³ Attributable to the shareholders of the parent

6) Back-up Overview of Volume Development

Units (YOY change)	Q1/14	H1/14	9M/14	FY 14	Q1/15	H1/15	9M/15	FY 15	Q1/16	H1/16
Market data for PC and LT production
EU	9%	6%	4%	3%	4%	3%	4%	4%	2%	4%
NAFTA	5%	4%	5%	5%	1%	2%	3%	3%	4%	3%
EU and NAFTA combined	7%	5%	5%	4%	3%	3%	3%	3%	3%	4%
Worldwide	5%	4%	4%	3%	2%	1%	1%	1%	2%	2%
Continental
Electronic stability control (ESC)	14%	12%	11%	12%	16%	14%	11%	11%	2%	5%
Anti-lock brake system (ABS)	-13%	-11%	-16%	-19%	-34%	-31%	-30%	-24%	-11%	-5%
Boosters	8%	10%	6%	5%	-1%	-4%	-8%	-7%	-3%	-3%
Calipers	7%	2%	1%	0%	-1%	0%	-3%	-2%	-8%	-9%
Advanced driver assistance systems (ADAS)	53%	50%	47%	47%	46%	53%	59%	58%	51%	45%
Engine electronic control units (ECUs)	7%	6%	6%	4%	-1%	-3%	-5%	-5%	-2%	3%
Injectors	-3%	-3%	-5%	-5%	-8%	-8%	-11%	-11%	-5%	-5%
Transmissions	8%	8%	6%	6%	6%	2%	0%	-1%	-1%	-1%
Turbochargers	64%	68%	71%	78%	59%	45%	50%	43%	23%	24%
Market data tires
PC and LT replacement tires Europe	6%	5%	4%	2%	-1%	2%	0%	0%	2%	2%
PC and LT replacement tires NAFTA	7%	6%	5%	6%	-6%	0%	1%	1%	5%	2%
Commercial vehicle tires OE Europe	1%	-7%	-4%	-7%	0%	4%	5%	5%	6%	6%
Commercial vehicle tires OE NAFTA	6%	10%	12%	12%	21%	17%	12%	7%	-12%	-12%
Commercial vehicle replacement tires Europe	15%	6%	3%	1%	-4%	2%	-1%	0%	2%	5%
Commercial vehicle replacement tires NAFTA	9%	9%	9%	8%	3%	5%	3%	3%	4%	2%
Continental
PC and LT tires	9%	6%	5%	3%	-1%	3%	2%	5%	9%	8%
Commercial vehicle tires	13%	8%	5%	3%	-3%	0%	3%	5%	7%	8%
ContiTech organic sales growth	5%	2%	2%	1%	2%	4%	4%	4%	3%	2%

Key Historical Credit Metrics – IAS 19 (rev. 2011) applied⁶

(mn €)1
	2011	2012	2013	2014	2015	LTM 2016
Statement of Cash Flows
Adjusted EBITDA2	4,247	4,822	5,094	5,318	6,094	6,269
Reported EBITDA	4,228	4,967	5,095	5,134	6,001	6,184
Net cash interest paid	-662	-575	-534	-158	-174	-150
Tax paid	-466	-684	-805	-775	-1,015	-991
Change in net working capital3	-556	564	-4	-207	-107	8
Other4	-256	-488	-30	175	210	133
Cash flow arising from operating activities	2,289	3,785	3,722	4,168	4,916	5,184
Cash flow arising from investing activities	-1,798	-2,132	-1,904	-2,153	-3,472	-3,063
- thereof capex in PPE and intangibles	-1,813	-2,081	-2,024	-2,110	-2,265	-2,375
Cash flow before financing activities	491	1,653	1,818	2,015	1,444	2,121
Statement of Financial Position
Cash and cash equivalents	1,541	2,397	2,045	3,244	1,622	1,720
Derivative instruments and interest-bearing investments	249	536	303	364	81	64
Total indebtedness	8,562	8,253	6,638	6,432	5,245	5,230
Net indebtedness	6,772	5,320	4,289	2,824	3,542	3,446
Credit Ratios
Net indebtedness / adjusted EBITDA2	1.6x	1.1x	0.8x	0.5x	0.6x	0.5x
Net cash interest paid coverage (ratio)5	6.4x	8.4x	9.5x	33.7x	35.1x	41.8x
1 Amounts shown may contain rounding differences 2 Adjusted EBITDA starting 2011 as defined in syndicated loan but IAS 19 (rev. 2011) not applied in 2012 3 Includes changes in inventories, trade accounts receivable, trade accounts payable and discounted notes 4 Includes dividends received, income from at-equity accounted and other investments, incl. impairment and reversal of impairment losses, gains / losses from the disposal of assets, companies and business operations, other non-cash items as well as changes in employee benefits and other provisions and in other assets and liabilities 5 Adjusted EBITDA to net cash interest paid 6 Since 2012

Capex, Depreciation and EPS Breakdown H1 2016

¹ Amortization of intangibles from PPA

² Assuming corporate tax rate of 28%

Automotive Group Financials – Chassis & Safety

• › Sales increased by 5.7% before consolidation and FX effects
• › EBITDA increased by €24.1 mn to €614.8 mn (+4.1%)
• › Adj. EBIT¹ increased by €14.6 mn to €439.2 mn (adj. EBIT¹ margin 9.9%)
• › EBIT increased by €9.3 mn to €433.5 mn (EBIT margin 9.7%)
• › PPA effect in H1 2016: -€0.2 mn
• › No special effects in H1 2016

Automotive Group Financials – Powertrain

• › Sales increased by 2.2% before consolidation and FX effects
• › EBITDA decreased by €0.1 mn to €360.6 mn (unchanged)
• › Adj. EBIT¹ decreased by €12.7 mn to €189.1 mn (adj. EBIT¹ margin 5.2%)
• › EBIT decreased by €22.4 mn to €175.3 mn (EBIT margin 4.8%)
• › PPA effect in H1 2016: -€5.5 mn
• › Special effects in H1 2016: -€6.0 mn

Powertrain H1 2016

Automotive Group Financials – Interior

• › Sales increased by 3.4% before consolidation and FX effects
• › EBITDA decreased by €63.1 mn to €489.6 mn (-11.4%)
• › Adj. EBIT¹ decreased by €70.3 mn to €355.5 mn (adj. EBIT¹ margin 8.8%)
• › EBIT decreased by €92.0 mn to €333.0 mn (EBIT margin 8.1%)
• › PPA effect in H1 2016: -€18.0 mn
• › Special effects in H1 2016: -€0.1 mn

Interior H1 2016

Rubber Group Financials – Tires

• › Sales increased by 6.2% before consolidation and FX effects
• › EBITDA increased by €117.2 mn to €1,431.5 mn (+8.9%)
• › Adj. EBIT¹ increased by €118.1 mn to 1,180.4 mn (adj. EBIT¹ margin 22.8%)
• › EBIT increased by €117.3 mn to €1,175.4 mn (EBIT margin 22.6%)
• › PPA effect in H1 2016: -€3.8 mn
• › No special effects in H1 2016

Tires H1 2016

6) Back-up Tires – Passenger and Light Truck Tire Demand

Tires – Commercial Vehicle Tire Demand

-30% -20% -10% 0% 10% 20% 30% Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Truck tire replacement (YOY chg. monthly) km BAG monthly (adj.) 1 2

¹ BAG = Bundesamt für Güterverkehr

² ATA = American Trucking Association (miles traveled)

Rubber Group Financials – ContiTech

• › Sales increased by 1.8% before consolidation and FX effects
• › EBITDA increased by €75.0 mn to €373.3 mn (+25.1%)
• › Adj. EBIT¹ increased by €76.8 mn to €286.1 mn (adj. EBIT¹ margin 10.8%)
• › EBIT increased by €88.2 mn to €225.4 mn (EBIT margin 8.2%)
• › PPA effect in H1 2016: -€41.4 mn
• › Special effects in H1 2016: -€16.5 mn

Sales (mn €) EBITDA margin Adj. EBIT margin 1

Fact Sheets 2014 – Q2 2016

6) Fact Sheets Quarterly Sales

			2014					2015					2016
Sales (mn €)	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	1,878.2	1,868.5	1,823.4	1,944.8	7,514.9	2,136.0	2,142.1	1,999.0	2,172.6	8,449.7	2,201.8	2,246.2
Powertrain	1,579.1	1,598.4	1,638.9	1,677.9	6,494.3	1,826.5	1,819.8	1,657.4	1,764.8	7,068.5	1,813.5	1,841.5
Interior	1,699.1	1,733.9	1,725.4	1,844.1	7,002.5	1,975.2	2,057.0	2,028.2	2,094.4	8,154.8	2,023.0	2,099.8
Tires	2,318.3	2,405.9	2,557.8	2,502.4	9,784.4	2,419.8	2,644.4	2,654.4	2,690.2	10,408.8	2,512.7	2,692.7
ContiTech	973.4	978.6	979.6	999.6	3,931.2	1,268.3	1,418.8	1,330.8	1,349.9	5,367.8	1,359.1	1,376.6
Other / Consolidation	-58.0	-57.3	-55.6	-50.7	-221.6	-56.9	-52.4	-52.2	-56.1	-217.6	-59.4	-65.8
Continental Corporation	8,390.1	8,528.0	8,669.5	8,918.1	34,505.7	9,568.9	10,029.7	9,617.6	10,015.8	39,232.0	9,850.7	10,191.0

Changes Y-o-Y in %			2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	13.7	14.6	9.6	11.7	12.4	3.1	4.9
Powertrain	15.7	13.9	1.1	5.2	8.8	-0.7	1.2
Interior	16.2	18.6	17.5	13.6	16.5	2.4	2.1
Tires	4.4	9.9	3.8	7.5	6.4	3.8	1.8
ContiTech	30.3	45.0	35.9	35.0	36.5	7.2	-3.0
Continental Corporation	14.0	17.6	10.9	12.3	13.7	2.9	1.6

6) Fact Sheets Quarterly EBITDA

EBITDA (mn €)	2014				2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	254.0	242.0	262.0	260.1	1,018.1	297.3	293.4	268.3	301.3	1,160.3	302.8	312.0
Powertrain	157.0	125.3	-11.9	172.9	443.3	177.2	183.5	167.3	202.7	730.7	158.8	201.8
Interior	223.2	244.5	229.7	248.9	946.3	252.9	299.8	252.4	277.1	1,082.2	237.4	252.2
Tires	545.4	591.9	603.5	540.0	2,280.8	579.7	734.6	667.7	622.3	2,604.3	658.1	773.4
ContiTech	143.7	132.9	144.7	130.5	551.8	129.2	169.1	159.7	119.2	577.2	176.1	197.2
Other / Consolidation	-27.5	-26.6	-24.7	-27.7	-106.5	-33.1	-47.1	-23.7	-49.4	-153.3	-27.7	-23.5
Continental Corporation	1,295.8	1,310.0	1,203.3	1,324.7	5,133.8	1,403.2	1,633.3	1,491.7	1,473.2	6,001.4	1,505.5	1,713.1

EBITDA margin in %	2014				2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	13.5	13.0	14.4	13.4	13.5	13.9	13.7	13.4	13.9	13.7	13.8	13.9
Powertrain	9.9	7.8	-0.7	10.3	6.8	9.7	10.1	10.1	11.5	10.3	8.8	11.0
Interior	13.1	14.1	13.3	13.5	13.5	12.8	14.6	12.4	13.2	13.3	11.7	12.0
Tires	23.5	24.6	23.6	21.6	23.3	24.0	27.8	25.2	23.1	25.0	26.2	28.7
ContiTech	14.8	13.6	14.8	13.1	14.0	10.2	11.9	12.0	8.8	10.8	13.0	14.3
Continental Corporation	15.4	15.4	13.9	14.9	14.9	14.7	16.3	15.5	14.7	15.3	15.3	16.8

Changes Y-o-Y in %			2015						2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3
Chassis & Safety	17.0	21.2	2.4	15.8	14.0	1.8	6.3
Powertrain	12.9	46.4	1,505.9	17.2	64.8	-10.4	10.0
	13.3	22.6	9.9	11.3	14.4	-6.1	-15.9
	6.3	24.1	10.6	15.2	14.2	13.5	5.3
ContiTech	-10.1	27.2	10.4	-8.7	4.6	36.3	16.6
Continental Corporation	8.3	24.7	24.0	11.2	16.9	7.3	4.9

6) Fact Sheets Quarterly EBIT

EBIT (mn €)	2014					2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	172.3	159.3	179.5	169.1	680.2	214.9	209.3	181.5	208.6	814.3	213.2	220.3
Powertrain	64.5	32.9	-263.3	69.1	-96.8	96.7	101.0	81.3	116.6	395.6	66.5	108.8
Interior	137.8	154.7	144.8	168.6	605.9	190.9	234.1	178.7	200.8	804.5	160.1	172.9
Tires	440.7	482.4	486.8	419.5	1,829.4	454.0	604.1	536.5	490.6	2,085.2	530.0	645.4
ContiTech	115.5	104.3	115.1	98.4	433.3	54.9	82.3	80.6	-47.2	170.6	98.7	126.7
Other / Consolidation	-27.6	-26.7	-25.1	-27.8	-107.2	-33.5	-47.5	-24.0	-49.6	-154.6	-27.8	-24.5
Continental Corporation	903.2	906.9	637.8	896.9	3,344.8	977.9	1,183.3	1,034.6	919.8	4,115.6	1,040.7	1,249.6

EBIT margin in %		2014					2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	9.2	8.5	9.8	8.7	9.1	10.1	9.8	9.1	9.6	9.6	9.7	9.8
Powertrain	4.1	2.1	-16.1	4.1	-1.5	5.3	5.6	4.9	6.6	5.6	3.7	5.9
Interior	8.1	8.9	8.4	9.1	8.7	9.7	11.4	8.8	9.6	9.9	7.9	8.2
Tires	19.0	20.1	19.0	16.8	18.7	18.8	22.8	20.2	18.2	20.0	21.1	24.0
ContiTech	11.9	10.7	11.7	9.8	11.0	4.3	5.8	6.1	-3.5	3.2	7.3	9.2
Continental Corporation	10.8	10.6	7.4	10.1	9.7	10.2	11.8	10.8	9.2	10.5	10.6	12.3

Changes Y-o-Y in %			2015					2016
	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3
Chassis & Safety	24.7	31.4	1.1	23.4	19.7	-0.8	5.3
Powertrain	49.9	207.0	130.9	68.7	508.7	-31.2	7.7
Interior	38.5	51.3	23.4	19.1	32.8	-16.1	-26.1
Tires	3.0	25.2	10.2	16.9	14.0	16.7	6.8
ContiTech	-52.5	-21.1	-30.0	-148.0	-60.6	79.8	53.9
Continental Corporation	8.3	30.5	62.2	2.6	23.0	6.4	5.6

6) Fact Sheets Quarterly Adjusted EBIT¹

			2015			2016
Adj. EBIT 1 (mn €)	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	215.2	209.4				215.7	223.5
Powertrain	98.8	103.0				72.6	116.5
Interior	191.3	234.5				168.0	187.5
Tires	455.6	606.7				533.0	647.4
ContiTech	82.8	126.5				133.5	152.6
Other / Consolidation	-33.5	-47.5				-27.8	-24.5
Continental Corporation	1,010.2	1,232.6				1,095.0	1,303.0

			2015			2016
Adj. EBIT 1 margin in %	Q1	Q2	Q3	Q4	Year	Q1	Q2	Q3	Q4	Year
Chassis & Safety	10.1	9.8				9.8	10.0
Powertrain	5.4	5.7				4.0	6.4
Interior	9.7	11.4				8.5	9.1
Tires	18.8	22.9				21.3	24.1
ContiTech	6.5	8.9				10.5	11.1
Continental Corporation	10.6	12.3				11.3	12.9

Changes Y-o-Y in %

6) Fact Sheets Consolidated Statement of Income

Consolidated Statement of Income
Mill. EUR	2016	2015	2014	2016	2015	2014
	1 - 6	1 - 6	1 - 6	Q 2	Q 2	Q 2
Sales	20,041.7	19,598.6	16,918.1	10,191.0	10,029.7	8,528.0
Cost of sales	-14,609.2	-14,501.2	-12,694.9	-7,359.6	-7,355.1	-6,400.5
Gross margin on sales	5,432.5	5,097.4	4,223.2	2,831.4	2,674.6	2,127.5
Research and development expenses	-1,442.9	-1,274.3	-1,073.8	-726.8	-631.3	-529.7
Selling and logistics expenses	-1,109.2	-1,074.7	-873.4	-561.2	-553.8	-442.5
Administrative expenses	-498.1	-459.3	-381.2	-254.4	-244.8	-202.3
Other expenses and income	-128.9	-156.1	-67.3	-59.9	-78.4	-20.3
Income from at-equity accounted investees	36.6	27.8	-17.7	20.2	16.6	-26.1
Other income from investments	0.3	0.4	0.3	0.3	0.4	0.3
Earnings before interest and tax	2,290.3	2,161.2	1,810.1	1,249.6	1,183.3	906.9
Interest income	49.6	49.3	46.3	24.8	21.5	19.7
Interest expense	-98.2	-148.3	-186.8	-39.6	-64.8	-80.2
Net interest result	-48.6	-99.0	-140.5	-14.8	-43.3	-60.5
Earnings before tax	2,241.7	2,062.2	1,669.6	1,234.8	1,140.0	846.4
Income tax expense	-567.1	-571.2	-323.9	-311.3	-326.8	-108.3
Net income	1,674.6	1,491.0	1,345.7	923.5	813.2	738.1
Non-controlling interests	-35.8	-42.4	-41.9	-18.6	-21.3	-22.6
Net income attributable to the shareholders of the parent	1,638.8	1,448.6	1,303.8	904.9	791.9	715.5
Basic earnings per share (in €)	8.19	7.24	6.52	4.52	3.96	3.58
Diluted earnings per share (in €)	8.19	7.24	6.52	4.52	3.96	3.58

6) Fact Sheets Consolidated Statement of Financial Position – Assets

in € millions	June 30, 2016	Dec. 31, 2015	June 30, 2015
Goodwill	6,621.9	6,640.6	6,168.3
Other intangible assets	1,280.3	1,336.4	1,140.8
Property, plant and equipment	9,596.7	9,538.9	9,222.2
Investment property	15.6	16.0	17.4
Investments in at-equity accounted investees	371.8	345.8	312.0
Other investments	39.7	14.1	12.9
Deferred tax assets	1,952.6	1,669.7	1,640.1
Defined benefit assets	36.0	18.9	3.0
Long-term derivative instruments and interest-bearing investments	21.1	17.1	312.6
Long-term other financial assets	49.8	47.6	35.4
Long-term other assets	23.3	21.5	20.5
Non-current assets	20,008.8	19,666.6	18,885.2
Inventories	3,804.9	3,360.1	3,605.5
Trade accounts receivable	7,264.5	6,722.9	7,084.3
Short-term other financial assets	504.9	434.7	464.5
Short-term other assets	921.2	803.9	930.1
Income tax receivables Short-term derivative instruments and interest-bearing investments	153.2 42.8	149.7 64.3	128.4 106.3
Cash and cash equivalents	1,720.1	1,621.5	2,349.7
Assets held for sale	9.5	12.0	51.3
Current assets	14,421.1	13,169.1	14,720.1
Total assets	34,429.9	32,835.7	33,605.3

Starting from the year under review, 2016, the structure of the equity and liabilities side is presented in an adjusted form to increase transparency with regards to employee benefits. All of the following figures from comparative periods are accordingly adjusted.

H1 2016 Results – August 3, 2016 EDMR – Equity and Debt Markets Relations 46

6) Fact Sheets

Consolidated Statement of Financial Position – Total Equity and Liabilities

in € millions	June 30, 2016	Dec. 31, 2015	June 30, 2015
Subscribed capital	512.0	512.0	512.0
Capital reserves	4,155.6	4,155.6	4,155.6
Retained earnings	10,370.6	9,481.8	8,202.9
Other comprehensive income	-2,109.8	-1,363.1	-900.0
Equity attributable to the shareholders of the parent	12,928.4	12,786.3	11,970.5
Non-controlling interests	430.1	427.6	451.3
Total equity	13,358.5	13,213.9	12,421.8
Long-term employee benefits	4,644.6	3,696.5	3,676.9
Deferred tax liabilities	356.9	361.2	276.4
Long-term provisions for other risks and obligations	184.7	171.8	197.2
Long-term indebtedness	2,402.6	3,175.0	2,775.0
Long-term other financial liabilities	40.3	94.9	88.0
Long-term other liabilities	20.4	21.6	14.8
Non-current liabilities	7,649.5	7,521.0	7,028.3
Short-term employee benefits	1,186.6	1,269.4	1,093.3
Trade accounts payable	6,043.1	5,493.8	5,552.8
Income tax payables	774.5	719.8	677.7
Short-term provisions for other risks and obligations	753.5	845.5	811.6
Short-term indebtedness	2,827.6	2,069.8	4,229.2
Short-term other financial liabilities	1,065.8	1,066.4	996.2
Short-term other liabilities	766.5	634.1	775.2
Liabilities held for sale	4.3	2.0	19.2
Current liabilities	13,421.9	12,100.8	14,155.2
Total equity and liabilities	34,429.9	32,835.7	33,605.3

Starting from the year under review, 2016, the structure of the equity and liabilities side is presented in an adjusted form to increase transparency with regards to employee benefits. All of the following figures from comparative periods are accordingly adjusted.

H1 2016 Results – August 3, 2016 EDMR – Equity and Debt Markets Relations 47

6) Fact Sheets

Consolidated Statement of Cash Flows

	January 1 to June 30
in € millions	2016	1 2015
Net income	1,674.6	1,491.0
Income tax expense	567.1	571.2
Net interest result	48.6	99.0
EBIT	2,290.3	2,161.2
Interest paid	-63.1	-90.6
Interest received	12.1	16.1
Income tax paid	-544.0	-568.4
Dividends received	18.6	27.8
Depreciation, amortization, impairment and reversal of impairment losses	928.3	875.3
Income from at-equity accounted and other investments, incl. impairment and reversal of impairment losses	-36.9	-28.2
Gains/losses from the disposal of assets, companies and business operations	-3.4	-12.1
Changes in
inventories	-457.5	-263.0
trade accounts receivable	-621.6	-713.8
trade accounts payable	611.3	394.0
employee benefits and other provisions	-84.3	15.7
other assets and liabilities	-67.9	-100.2
Cash flow arising from operating activities	1,981.9	1,713.8
Cash flow from the disposal of property, plant and equipment, and intangible assets	13.6	19.9
Capital expenditure on property, plant and equipment, and software	-919.9	-815.8
Capital expenditure on intangible assets from development projects and miscellaneous	-39.9	-34.0
Cash flow from the disposal of companies and business operations	5.1	-1.7
Acquisition of companies and business operations	-81.8	-600.2
Cash flow arising from investing activities	-1,022.9	-1,431.8
Cash flow before financing activities (free cash flow)	959.0	282.0
Change in indebtedness	-22.9	-582.6
Successive purchases	-22.4	-11.1
Dividends paid	-750.0	-650.0
Dividends paid to and cash changes from equity transactions with non-controlling interests	-26.7	-40.9
Cash and cash equivalents arising from first consolidation of subsidiaries	0.6	—
Cash flow arising from financing activities	-821.4	-1,284.6
Change in cash and cash equivalents	137.6	-1,002.6
Cash and cash equivalents at the beginning of the reporting period	1,621.5	3,243.8
Effect of exchange rate changes on cash and cash equivalents	-39.0	108.5
Cash and cash equivalents at the end of the reporting period	1,720.1	2,349.7

¹The prior-year comparative figures have been adjusted in accordance with the current structure

6) Fact Sheets H1 2016 Results Reported and Adjusted (mn €) – by Division

	Chassis & Safety 2015	2016	Powertrain 2015	2016	Interior 2015	2016	Tires 2015	2016	ContiTech 2015	2016	Cons./Corr. 2015	2016	Corporation 2015	2016
Sales	4,278.1	4,448.0	3,646.3	3,655.0	4,032.2	4,122.8	5,064.2	5,205.4	2,687.1	2,735.7	-109.3	-125.2	19,598.6	20,041.7
	Chassis & Safety 2015	2016	Powertrain 2015	2016	Interior 2015	2016	Tires 2015	2016	ContiTech 2015	2016	Cons./Corr. 2015	2016	Group 2015	2016
EBIT in % of sales	424.2 9.9%	433.5 9.7%	197.7 5.4%	175.3 4.8%	425.0 10.5%	333.0 8.1%	1,058.1 20.9%	1,175.4 22.6%	137.2 5.1%	225.4 8.2%	-81.0	-52.3	2,161.2 11.0%	2,290.3 11.4%
Amortization of intangible assets from PPA	0.4	0.2	4.1	5.5	0.8	18.0	3.9	3.8	57.9	41.4	0.0	0.0	67.1	68.9
Total special effects	0.0	0.0	0.0	6.0	0.0	0.1	0.3	0.0	14.2	16.5	0.0	0.0	14.5	22.6
Total consolidation effects	0.0	5.5	0.0	2.3	0.0	4.4	0.0	1.2	0.0	2.8	0.0	0.0	0.0	16.2
Total consolidation & special effects	0.0	5.5	0.0	8.3	0.0	4.5	0.3	1.2	14.2	19.3	0.0	0.0	14.5	38.8
Adjusted operating result (adj. EBIT) 1 1 Before amortization of intangibles from PPA, changes in the scope of consolidation and special effects in % of adjusted sales	424.6 9.9%	439.2 9.9%	201.8 5.5%	189.1 5.2%	425.8 10.6%	355.5 8.8%	1,062.3 21.0%	1,180.4 22.8%	209.3 7.8%	286.1 10.8%	-81.0	-52.3	2,242.8 11.4%	2,398.0 12.1%

6) Fact Sheets H1 2016 Results Reported and Adjusted (mn €) – by Group

	Automotive		Rubber		Cons./Corr.		Corporation
	2015	2016	2015	2016	2015	2016	2015	2016
Sales	11,908.3	12,168.5	7,714.7	7,896.3	-24.4	-23.1	19,598.6	20,041.7
	Automotive		Rubber		Cons./Corr.		Group
	2015	2016	2015	2016	2015	2016	2015	2016
EBIT	1,046.9	941.8	1,195.3	1,400.8	-81.0	-52.3	2,161.2	2,290.3
in % of sales	8.8%	7.7%	15.5%	17.7%			11.0%	11.4%
Amortization of intangible assets from PPA	5.3	23.7	61.8	45.2	0.0	0.0	67.1	68.9
Total special effects	0.0	6.1	14.5	16.5	0.0	0.0	14.5	22.6
Total consolidation effects	0.0	12.2	0.0	4.0	0.0	0.0	0.0	16.2
Total consolidation & special effects	0.0	18.3	14.5	20.5	0.0	0.0	14.5	38.8
Adjusted operating result (adj. EBIT) 1	1,052.2	983.8	1,271.6	1,466.5	-81.0	-52.3	2,242.8	2,398.0
in % of adjusted sales	8.8%	8.1%	16.5%	18.8%			11.4%	12.1%

Source: Based on publicly available data

6) Fact Sheets Continental's Credit Rating

² Non-contracted rating since February 1, 2014

References Useful Links

Continental Investor Relations website	http://www.continental-ir.com
Annual and interim reports	http://www.continental corporation.com/www/portal_com_en/themes/ir/financial_reports/
2015 Fact Book	http://www.continental corporation.com/www/portal_com_en/themes/ir/financial_reports/
Investor Relations events and presentations	http://www.continental-corporation.com/www/portal_com_en/themes/ir/events/
Sustainability at Continental (presentation and fact sheet for investors)	http://www.continental-ir.com
Corporate Social Responsibility	http://www.continental-sustainability.com
Corporate Governance Principles	http://www.continental corporation.com/www/portal_com_en/themes/ir/corporate_governance/
Continental share	http://www.continental-corporation.com/www/portal_com_en/themes/ir/share/
Continental bonds and rating	http://www.continental-corporation.com/www/portal_com_en/themes/ir/bonds/
Continental IR mobile website	http://continental.ir-portal.de