Goodtech — Investor Presentation 2014

Feb 26, 2014

Presentation fourth quarter 2013

26 February 2014

Agenda

• Highlights
• Financial review
• Order book
• Goodtech in brief
• Outlook

2

Highlights, fourth quarter 2013

• Turnover increased slightly to MNOK 615,0 in Q4 compared with 613,1 in Q4 2012
• Turnover for whole year 2013 increased 11,7 % to MNOK 2.433,8 compared with MNOK 2.179,0 in 2012
• EBITDA in Q4 was MNOK 11,8, compared with MNOK 26,3 in Q4 2012. Weaker performance in some areas
• EBITDA for whole year 2013 increased to MNOK 86,2 compared with MNOK 76,7 in 2012
• Order backlog maintained at high level of MNOK 1.306 at the end of 2013, compared with MNOK 1.143 at the end of 2012

Highlights, fourth quarter 2013

• Project and Services performed very well in 2013, even though a bit weaker in Q4
• Continue with action plan in Solutions to improve earnings
• • Continuous improvement of systems and routines to increase margins and improve quality
• •Cost and staff reduction
• • Order stock is increasing after period with lower activity in industry markets. Prospect volume has increased.
• •Successful completion of several projects
• Environment has not performed as expected in Q4 2013

Highlights, fourth quarter 2013, Market

• Order backlog stabilized on a high level, MNOK 1.306. Some contracts in Q4:
• • MSEK 107 power transmission turn-key contract with Svenska Kraftnät, Karlslund 400 kV
• • MSEK 20 Installation contract for PEAB Hubhult project
• • MSEK 17 Installation contract for Akademiska Hus, Malmö
• • MSEK 12,9 Production / logistic contract to Husquarna
• • MSEK 21,5 Turn-key contract for fully automatic Warehouse to Gekås
• • MNOK 16Biogas pre-treatment plant to IVAR

Highlights, fourth quarter 2013, Market

Significant contracts won after Q4

• • MNOK 35 Contract for delivery of control systems and panels to Hydro Aluminum, Karmøy Plant.
• • MNOK 40 Contract for delivery biogas treatment plant to Tønsberg - Vestfold Biogass

Financial Review

Main figures

( O ) N K 1. 0 0 0	Y T D 1 3	Y T D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu es	2 4 3 3 6 7 7	2 1 9 0 0 2 7	6 1 0 3 2 5	6 1 3 1 1 9
Pro du t e c xp en se s	1 1 9 7 5 3 5	1 0 3 0 0 2 6	2 8 7 0 8 3	2 8 7 4 5 4
Sa lar ex p en se s y	9 0 5 0 1 1	8 2 1 4 0 7	2 4 9 8 5 1	2 3 0 1 9 7
O he ing t t r o p er a ex p en se s	2 4 0 1 2 5	2 0 9 0 8 5	6 6 3 4 4	6 9 1 3 8
E B I T D A	8 6 2 1 8	7 6 6 6 1	1 1 7 5 3	2 6 3 3 0
E B I T D A %	3, 5 %	3, 5 %	1, 9 %	4, 3 %
ia io De t p re c n	2 4 0 2 1	2 2 8 4 5	6 4 2 6	3 5 7 7
No ing i te n re cu rr m s	3 0 8 7	0	6 9 6	0
E B I T	5 9 1 1 0	5 3 8 0 8	4 6 3 1	2 0 5 5 7
Ne f ina ia l i t te nc m s	-8 4 0 6	3 6 3 9 -	4 7 9 9 -	1 7 1 -
S ha f Pr f i fro As ia d t te re o o m so c co m p.	3 9 1 7	1 0 4 7	3 8 8 7	1 0 4 7
Pr f i be fo t ta o re xe s	5 4 6 2 1	5 1 2 1 5	3 1 0 7	2 1 4 3 3
Ta xe s	1 3 1 3 2	7 6 -	1 8 1 5	8 4 1 5 -
Ne l fro in ing io t r t t t es u m co n u o p er a ns	4 1 4 8 9	5 1 2 9 1	1 8 9 5	2 9 8 4 8
Ne inc / los fro d isc inu d o ion t t t om e s m on e p er a	0	3 1 5 9	0	2 9 4 0
Ne l t r t es u	4 1 4 8 9	5 4 4 5 0	1 8 9 5	3 2 7 8 8
A i bu b le t tr ta to :
Ow f he t t ne rs o p ar en	4 1 1 1 7	4 4 2 8 5	1 8 2 9	3 2 8 8 7
No l l ing in tro ter ts n-c on es	3 1 8	2 2	6 6	1
Su m	4 1 4 8 9	5 4 4 5 0	1 8 9 5	3 2 8 8 7
Ea ing ha fro inu ing ion t t rn s p er s re m co n op er a s	1, 2 8	1, 8 5	0, 0 6	0, 9 2
De lu d e ing ha te ar n s p er s re	1, 2 8	1, 5 8	0, 0 6	0, 9 2

Quarterly revenues and earnings - historical

Financial highlights – Balance sheet

N O K i l l io m n	3 1. 1 2. 1 3	3 1. 1 2. 1 2
F ixe d i b le ta ts ng as se	6 7, 5	4 6, 7
In i b le As ta ts ng se	6 9 6, 8	6 4 5, 8
To l F ixe d As ta ts se	7 6 4, 2	6 9 2, 5
Ca h s	3 3, 4	8 2, 9
O he Cu As t t ts r rre n se	3 9, 2 7	6 6 8, 0
To l Cu As ta t ts rre n se	2, 6 7 7	0, 9 7 5
To l As ta ts s e	1 5 3 6, 8	1 4 4 3, 3
To l e i ta ty q u	7 2 5, 2	6 8 7, 8
Lo Te L ia b i l i ies In Be ing t te t ng rm re s ar	1 1 8, 3	1 1 3, 2
O he Lo Te L ia b i l i ies t t r ng rm	1 1, 5	1 0, 9
Cu L ia b i l i ies In Be ing t t te t rre n re s ar	2 7 7,	2 8 5,
O he Cu L ia b i l i ies t t t r rre n	6 0 4, 6	6 0 6 5,
To l Eq i d De b ta ty t u a n	1 5 3 6, 8	1 4 4 3, 3
Ne In Be ing De b t te t t re s ar	1 6 2, 2	5 6, 1
Eq i Ra io ( % ) ty t u	4 2 % 7,	4 % 7, 7
Ne Ge ing ( % ) t ar	2 2, 4 %	8, 2 %
L iq i d i Ra io ty t u	1, 1	1, 2

Definitions:

Net Gearing (%): Net interest Bearing Debt/Total equity Liquidity Ratio : Current Assets/Current Liabilities

Financial highlights – Cash flow

N O K 1. 0 0 0	Y T D 1 3	Y T D 1 2	Q 4 1 3	Q 4 1 2
Ca h f low fro ion t s m op er a s	8 7 3 4 -	1 1 5 5 9 3	3 8 2 0 6	1 0 9 6 9 6
Ca f fro h low inv tm ts s m es en	3 9 1 8 7 -	7 2 2 1 -	2 9 2 4 8 -	8 9 5
Ca f fro f h low ina ia ls s m nc	8 6 7 8 8 -	5 9 1 4 2 -	4 7 9 3 3	1 2 2 9 0 -
Ne ha in h fr io d t c ng es c as om p er	-1 3 4 7 0 9	4 9 2 3 0	5 6 8 9 2	9 8 3 0 1
Ca fu f p Ne h ds be inn ing io d t t s n a g o er	8 2 8 5 7	3 2 9 7 3	1 0 3 8 0 0 -	1 5 1 0 4 -
f fe f e f E ha luc ion h he l d ts te tu t c o xc ng e ra a o n c as	5 9 6 5	6 5 4	1 0 2 2	3 4 0 -
Ne Ca h fu ds d f p io d t t e s n a n o er	4 5 8 8 6 -	8 2 8 5 7	4 5 8 8 6 -	8 2 8 5 7
*) Co f is ing t ns o
Ca h a d c h e iva len ba lan he ts t s n as q u ce s e -	3 3 3 6 5	8 2 8 5 7	3 3 3 6 5	8 2 8 5 7
Ov dr f fa i l i t ty er a c	7 9 2 5 1 -	0	7 9 2 5 1 -	0
Ne Ca h fu ds d f p io d t t e s n a n o er	4 5 8 8 6 -	8 2 8 5 7	4 5 8 8 6 -	8 2 8 5 7

Undraw n credit facilities amounts to MNOK 130,8 at the end of 2013

Cash flow from operations and EBITDA

Development in Cash flow from operations and EBITDA on 12 months rolling basis

Employees per business area

Projects &Services Infra Solutions Environment Products Admin

Order backlog

Projects & Services Infra Solutions Environment Products

Business areas – figures and facts

Business unit: Projects & Services (P&S)

N O K 1 .00 0	YT D 1 3	YT D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu e	1 5 76 98 2	1 4 24 00 7	39 7 4 05	40 7 8 72
EB ITD A	79 80 0	44 58 7	17 04 6	21 83 8
EB ITD A in % ma rg	1 % 5,	3, 1 %	4, 3 %	4 % 5,
Or de r b klo ac g	81 3 4 76	61 8 1 34	81 3 4 76	61 8 1 34
No f e loy . o mp ee s	1 1 62	1 1 01	1 1 62	1 1 01

Highlights

16

• • P&S business unit has performed acceptable in the quarter
• • Turnover at same level as Q4 2012. YTD turnover has increased 10,7 % compared with 2012
• • EBITDA lower than Q4 2012. YTD EBITDA has increased to MNOK 79,8 compared with MNOK 44,6 YTD 2012
• • Margin has improved to 5,1% for whole 2013 compared with 3,1% for 2012.
• • Order backlog increased to MNOK 813,5 in 2013 compared with 618,1 in 2012
• •Won MSEK 107 contract with Svenska Kraftnät in Q4

Business unit: Infra

N O K 1 .00 0	YT D 1 3	YT D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu e	29 4 4 12	20 4 1 42	69 98 4	65 32 0
EB ITD A	10 62 1	4 9 37	2 8 86	2 0 13
EB ITD A in % ma rg	3, 6 %	2, 4 %	4, 1 %	3, 1 %
Or de r b klo ac g	28 5 7 36	29 1 9 06	28 5 7 36	29 1 9 06
No f e loy . o mp ee s	66	54	66	54

• •Infra business is increasing.
• • Turnover increased in Q4 to MNOK 70 compared with MNOK 65,3 in Q4 2012. For whole year turnover has increased to MNOK 294,4 compared with MNOK 204,1 in 2012
• • EBITDA Q4 has increased to MNOK 2,9 compared with MNOK 2,0 in Q4 2012. EBITDA for whole year 2013 more than doubled to MNOK 10,6 compared with 2012.
• • Order backlog is still on a high level due to strong order intake in 2012 / 2013
• •Market look promising in the longer perspective

Business unit: Solutions

N O K 1 .00 0	YT D 1 3	YT D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu e	19 9 3 01	25 6 8 43	46 39 0	60 32 2
EB ITD A	-10 28 2	8 4 55	-4 99 5	-58 6
EB ITD A in % ma rg	-5, 2 %	3, 3 %	-10 8 % ,	-1, 0 %
Or de r b klo ac g	73 18 4	71 73 3	73 18 4	71 73 3
No f e loy . o mp ee s	13 3	14 5	13 3	14 5

• • Further corrective actions have been taken to improve earnings. Shall give positive effect / improvement going forward
• • Won new orders in, and after Q4. Order stock increasing
• •MSEK 12,9 Production / logistic contract to Husquarna
• •MSEK 21,5 Turn-key contract for fully automatic Warehouse to Gekås
• •Several other smaller contracts
• •Large prospect portefolio. Sales is still in focus
• • Largest production line delivered by Solutions has been taken over by customer. Very positive feedback from customer
• •Turnover in Q4 2013 lower than Q4 2012
• • EBITDA margin in Q4 and for whole year is negative
• • Cost due to lack of quality in projects within timber handling and weak performance in production lines projects

Business unit: Environment

O N K 1 .00 0	YT D 1 3	YT D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu e	29 6 5 66	23 9 2 82	83 35 9	64 04 5
EB ITD A	8 0 16	17 08 8	-1 36 1	4 0 43
EB ITD A in % ma rg	2, 7 %	7, 1 %	-1, 6 %	6, 3 %
Or de r b klo ac g	12 9 8 35	14 7 8 20	12 9 8 35	14 7 8 20
f e No loy . o mp ee s	78	71	78	71

• • Turnover increased to MNOK 83,4 in Q4 compared with MNOK 64 in Q4 2012. For whole 2013 turnover increased to MNOK 296,6 compared with MNOK 239,3 in 2012
• • Drop in EBITDA in Q4
• •Lower sale of Biovac® in Q4
• •Loss in one project
• • EBITDA of MNOK 8,0 in 2013 compared with MNOK 17,1 in 2012
• •Lower sales of Biovac ® products in 2013
• • Implementation of ERP and moving to new premises as part of growth strategy causes some extra cost
• • Order backlog still on a acceptable high level
• • Activity in the Norwegian SBR / Biovac® market is expected to increase in 2014. Postponed public orders in certain geographical areas from 2013 to 2014
• •Increasing activities in both the Norwegian and Swedish market

Business unit: Products

N O K 1 .00 0	YT D 1 3	YT D 1 2	Q 4 1 3	Q 4 1 2
Re ve nu e	92 71 6	80 08 2	23 34 2	21 59 1
EB ITD A	7 0 92	8 7 66	54 4	1 9 18
EB ITD A in % ma rg	7, 6 %	10 9 % ,	2, 3 %	8, 9 %
Or de r b klo ac g	4 2 35	13 49 6	4 2 35	13 49 6
No f e loy . o mp ee s	24	22	24	22

• • Turnover increased slightly in Q4 2013 compared with Q4 2012. Whole year 2013 increased to MNOK 92,7 from 80,1 in Q4 2012
• • EBITDA in Q4 2013 reduced to MNOK 0,5 compared with MNOK 1,9 in Q4 2012. EBITDA margin is acceptable for whole year 2013 compared with 2012
• •Increased sales force in 2013. Part of strategic growth plan
• •Implementation of new ERP system has been completed
• • Positive market outlook
• •OEM and System Integrator business is performing well.
• •Well established market position within several markets

Goodtech – in brief:

A considerable technology group - background

Turnover increased from MNOK 130 in 2005 to MNOK 2.434 in 2013

Goodtech in brief

• Approx 1.500 employees, with a revenue of NOK 2,4 billion NOK
• Strong local presence with 39 offices in Sweden, Norway and Åland
• Headoffice in Oslo and listed on Oslo Stock Exchange

Sweden

• Approx 1.150 employees
• 27 offices, from Kiruna in the north to Malmö in south

Norway

• Approx 290 employees
• 10 offices, with headoffice in Oslo

Åland

• Approx 40 employees
• Office in Mariehamn

Market drivers

Organisation

• Goodtech is organised into five business areas
• •Projects & Services
• •Infra
• •Solutions
• •Environment
• •Products

Solid service and product portfolio

Automation

technology

Industry Power Installation

technology

Environment technology

• •Innovative technologies and solutions
• •Turn-key projects
• •Broad specter of services and competence

Market segments

Highlights – Technology development

• Technology agreement with Dubal for Energy Recovery signed. Investment in pilot.
• •Preparing for test in progress.
• • Technology has high potential when successful test
• Dedicated technology development activities in Solutions
• • Technology is platform for winning of several contracts lately
• Develop technology and standardized solutions to stimulate to repeat business in all business units

Commercial and financial risks for Goodtech

Commercial and market risk

• •Market for Industry projects and solutions – some risk
• •Market for Infrastructure projects and solutions – some risk

Financial risks

• •In general small currency exposure
• •In general small risk for contract cancellation
• •In general small risk for loss on receivables
• •In general some risk related to projects
• Turn-key projects and deliveries
• • Some risk related to project execution
  • •Various complexity, size and duration of projects
  • •Shortage of Project Managers
• • Reducing risk:
  • MQSP (Method, Quality, Safety and Procurement) department focus on training, improvement of methods and quality
  • Training Project managers and employments ongoing
• Technology and product development
• •Some risk related to technical issues and market positioning

Outlook 2014

Outlook - Market

• Expect continuous upgrade and large investments within infrastructure, energy and oil & gas
• In general, promising markets for Goodtechs services, solutions and products – basis for organic growth
• The uncertainty in some markets due to uncertainty in the global economy seems to decrease. However still unpredictable

Brief market analysis:

• •Power and Energy market
• •Infrastructure, railway/subway
• •Industry, mines
• •Industry, manufacturing
• •Industry, paper
• •Oil & Gas Industry
• •Environment

31

•Public buildings

Summary / Outlook 2014

Growth strategy

• • Organic growth in business areas where Goodtech has strong position and positive market expectations
• • Expect strong market drivers within some market segments which is basis for three separate strategic initiatives
• •Energy / Power
• •Aquaculture
• •Oil & Gas
• •Maintain and improve margins

Summary / Outlook 2014

In 2014 Goodtech shall build stronger positions

• •Continue to build the Goodtech brand
• • Use customer focus and well established market position to increase business
• • Use of own product technology and technical competence
• • Open for non-organic growth within certain areas, consolidation possibilities in the market

Maintain active dividend policy

The Goodtech Way!

Your success – our goal!