GRAMMER AG — Investor Presentation 2017

Nov 13, 2017

Presentation First Nine Months 2017

Amberg, November 13, 2017

Ongoing operational improvements. Proxy fight has negative impacts on earnings

Major developments in the first nine months 2017

• Successful AGM proxy-fight against minority shareholder Cascade
• New strategic partnership with Chinese automotive supplier Ningbo Jifeng established
• Further increase of JAP (associated company of Ningbo Jifeng) holdings to 25.51% makes an "unfriendly" influence or change-of-control nearly impossible
• Order intake and new contract signings remained unsatisfactory as some major German OEMs are still reluctant to award GRAMMER with new business due to the development in GRAMMER AG's shareholder structure
• Global automotive markets with positive momentum. GRAMMER as an interior specialist is not impacted by current discussions about Diesel emission standards
• Global truck markets with solid growth in 2017 while demand in Brazil is stabilizing after many years of strong decline
• Agricultural markets beginning to show noticeable signs of recovery. In addition also ongoing very positive growth development of construction and material handling markets
• The significantly lower level of orders, in addition to the corresponding smaller number of new projects in the Automotive segment burden the current business yearꞌs earnings performance
• However, GRAMMER Group could further improve its operational performance, leading to operative EBIT of 58.6 EUR million with an operative EBIT margin of 4.4% in the first 9 months of 2017
• Despite this additional cost burden GRAMMER AG continues to expect a very positive operating EBIT for the businessyear 2017 with an EBIT margin above the previous year's level of 4.0%

Group revenues and operating EBIT with ongoing improvement

• Negative FX-translation impact of -10 EUR million
• FX adjusted growth rate: +7%

EBIT and operating EBIT[in € million and % of revenues]

• EBIT impacted by FX-evaluation and exceptional expenses in connection with the change of control attempt by a minority shareholder as well as uncovered R&D/project costs
• Improvement in operating performance is clearly visible, with operative EBIT increasing by 23% vs. previous year

EBIT bridge 1-9 2017

• 1. Negative impact vs. previous year from foreign currency evaluation of receivables and liabilities, totaling around -8 € m. (2016: +2, 2017: -6)
• 1. Special expenses in connection with the change of control attempt by a minority shareholder, totaling approx. -7 € million
• 1. Lower order intake levels and smaller number of new projects due to the past uncertainties in GRAMMER AG's shareholders' structureresulting in higher uncovered R&D and project costs, mainly in the Automotive segment
• 1. Positive EBIT impact due to higher volumes mainly in the Commercial Vehicles segment based on noticeable recovery of core markets in Europe and stabilization of truck market in Brazil
• 1. Positive EBIT impact from optimizing fixed costs and process structures as well as lower footprint costs

Net profit on par with prev. year. EPS slightly diluted due to capital increase

Corporate tax rate 30% in the first nine months of 2017

EPS slightly lower than previous year, reflecting the small dilution due to the higher share capital after the conversionof the mandatory convertible bond in April 2017

Higher equity and lower debt due to convertible bond placement in February

• Equity increased by 87 € million due to the positive net earnings development and the placement of the mandatory convertible bond in Q1 2017
• Equity ratio improved to 31%

Net financial debt and gearing[in € million and %]

• Higher investments and higher trade receivables impacted cash flow development
• Placement of the mandatory convertible bond reduced net financial debt and gearing ratio

Investments continue to focus on expansion and optimization measures

Increase in headcount in-line with ongoing business growth

AUTOMOTIVE – ORDER INTAKE SITUATION 2017

Lower order intake due to reluctance of main customers to award new business

Q1-Q3 2017 Automotive order intake for new projects [life-time* revenues in € million]

• Order intake for new future projects is still lower compared to our internal expectations
• Despite new business awards after the AGM by one German premium OEM and successful sales activities with other customers the Automotive order intake is lower than planned

*) life-time: projected revenues generated over the entire project life-cycle (ave. 6-7 years)**) German Premium OEMs: BMW, Daimler, Volkswagen Group

Full-year Automotive order intake for new projects[life-time revenues* in € million]

*) life-time: projected revenues generated over the entire project life-cycle (ave. 6-7 years)

AUTOMOTIVE – DEVELOPMENT 1-9 2017

Improvement of operating performance, but neg. impact of uncovered project costs

• Growth rate has normalized due to the base effect as a result
• of previous year's very high growth
• Negative FX-translation impact of -7 € m. (FX adj. +4%)

Despite impact of uncovered project costs, further improvement of operative EBIT achieved reflecting the success of the cost optimization measures implemented

COMMERCIAL VEHICLES – DEVELOPMENT 1-9 2017

Partial recovery of key markets and cost optimization drive EBIT improvement

• Growth in the first 9 months mainly driven by a strong third quarter (+18%) as well as the noticeable recovery in Brazil and the agricultural machinery markets
• Negative FX-translation impact of -3 € m. (FX adj. +13%)

EBIT and operating EBIT[in € million and % of revenues]

• Further EBIT improvements based on the favorable market conditions and fixed cost optimization
• Operative EBIT increased by 31% vs. previous year and operative EBIT margin improved by 1.4%-points to 8.6%

GRAMMER GROUP – MARKET OUTLOOK 2017

Car & Truck markets with solid growth. Brazil and Agriculture recovering in 2017

[in % yoy]Actual2016Forecast2017EuropeUSABrazilChina+3%+2%-11%+14%+3%-3%+18%+/-0%Trendvs. prev. FC

+5%

Car production – Actual 2016 & Forecast 2017

Copyright 2017 GRAMMER AG - Presentation 1-9 2017

World

Agricultural market outlook 2017 by our main customers

Source: *) John Deere forecast as of August 18, 2017 (prev. forecast as of May 19, 2017) **) AGCO Group forecast as of October 31, 2017 (prev. forecast July 27, 2017)

Truck production – Actual 2016 & Forecast 2017[Trucks >6t, in % yoy]

+2%

GRAMMER Group – Outlook:

• At Group level GRAMMER forecasts an increase in revenue of around 5% over the previous year in 2017.
• The reticence of some premium manufacturers to place new orders with GRAMMER AG due to the developments in theshareholders' structure was clearly noticeable especially in the first half-year and is partly still continuing in the second half of 2017.
• As a result of the significantly lower level of orders and smaller number of new projects in the Automotive segment, costs of development, sales and projects can now no longer be allocated to the new projects and invoiced to customers as planned. Accordingly, these costs burden the current business year's operating earnings.
• Despite this additional cost burden GRAMMER AG continues to expect a very positive operating EBIT for the business year 2017 with an operating EBIT margin above the previous year's level of 4.0%.
• From today's point of view there is no need to adjust GRAMMER Group's midterm projections.

Backup Information

GRAMMER GROUP

Key Figures 1-9 and Q3 2017

[ S, ] I F R i € i l l i n m o n	Q 3 2 0 1 7	Q 3 2 0 1 6	C h g.	1- 9 2 0 1 7	1- 9 2 0 1 6	C h g.
G R r o u p e v e n u e s	4 3 0. 9	4 0 4. 7	6. 5 % +	1, 3 3 8. 9	1, 2 6 5. 3	5. 8 % +
E B I T D A E B I T D A- M i a r g n	2 3. 2 4 % 5.	2 5. 4 6. 3 %	-8 7 % -0 9 % -P	8 2. 7 6. 2 %	8 5. 2 6. % 7	-2 9 % -0 % -P 5
E B I T E B I T- M i a r g n	1 0. 7 2. 5 %	1 3. 1 3. 2 %	-1 8. 3 % -P -0 7 %	4 5. 8 3. 4 %	4 9. 5 3. 9 %	-7 5 % -P -0 5 %
O i E B I T t p e r a n g O i E B I T- M i t p e r a n g a r g n	1 4. 6 3. 4 %	1 1. 8 2. 9 %	2 3. 7 % + 0. % -P 5 +	5 8. 6 4. 4 %	4 7. 5 3. 8 %	2 3. 4 % + 0. 6 % -P +
P f i f t t t r o a e r a x e s E P S i € n	5. 7 0. 4 7	4. 3 0. 3 8	3 2. 6 % + 2 3. 7 %	2 5. 7 2. 1 3	2 5. 5 2. 2 6	0. 8 % + -5 8 %
T l A t t o a s s e s E i t q u y E i -R i t t q u y a o	1, 0 9 2. 3 3 3 6. 7 3 1 %	1, 0 3 4. 3 2 4 9. 4 2 4 %	5. 6 % + 3 0 % 5. + 7 % -P +	1, 0 9 2. 3 3 3 6. 7 3 1 %	1, 0 3 4. 3 2 4 9. 4 2 4 %	5. 6 % + 3 0 % 5. + % -P 7 +
N F i i l D b t t e n a n c a e G i R i t e a r n g a o	1 6. 5 5 4 6 %	1 6 2. 9 6 5 %	-3 9 % -P -1 9 %	1 6. 5 5 4 6 %	1 6 2. 9 6 5 %	-3 9 % -P -1 9 %
C ( / ) M & A a p e o x w D i i t e p r e c a o n	1 1. 7 1 2. 5	1 4. 2 1 2. 2	-1 6 % 7. 2. 5 % +	4 0. 2 3 6. 9	3 4. 1 3 5. 7	1 9 % 7. + 3. 4 +
E l ( h- d ) t m p o y e e s m o n e n	1 2, 7 5 9	1 2, 1 9 6	4. 6 % +	1 2, 9 7 5	1 2, 1 9 6	4. 6 % +

GRAMMER AG – SHARE PRICE DEVELOPMENT

Key Figures 1-9 and Q3 2017

Selected Broker Recommendations

Br ok er	Da te	Cu nt Re rre co mm	Cu nt TP rre ( €)
Od do BH F	7-N -17 ov	Ho ld	52 .0
Ba nk ha La us mp e	-O 20 17 ct-	Ho ld	49 .0
MM W arb urg	-O 16 ct- 17	Bu y	57 .0
Ba ad He lve er a	-O 13 17 ct-	Ho ld	55 .0
DZ Ba nk	-Se 19 t-1 7 p	Bu y	61 .0
LB BW	10 -Au 17 g-	Ho ld	45 .0
Me dia n			53 .2

Top Shareholders

Inv to	in * %
es r
Ca J A P i l Ho l d ing ** ta p	2 1 % 5. 5
Ca de *** sc a	1 3. 4 1 %
Ha log ***	9. 1 8 %
D im ion l en s a	4. 8 % 5
Ow ha tre n as ury s re s	2. 6 2 %
Fr F loa ( 3 % ) t ee <	4 4. 0 % 7
) Pe nta bas ed 12, 607 ,12 1 v otin ig hts rce ge on g r *) Ass oci d c f G RA MM ER 's s ic ate trat om pan y o eg r N ing bo Jife tne par ng
***) Co ani ned by Ha r fa mil sto mp es ow y

Basic Share Data

S I I N		D E 0 0	0 8 9 4 0 5 5
W K N / Co de		5 8 9 5 4	/ G M M 0
Nu be f s m r o	ha re s	1 2,	6 0 7, 1 2 1
Ma ke t c r ap [	6 2 8 17]	€ i l l ion m
/ Av d ing l. ( 7 5, 0 0 0 ha da tra ) e. vo Xe tra s re s y
Av d ing l. ( ha / da tra 1 1 0, 0 0 0 e. vo all h.) s re s y exc
In de x	S / D A X D A X	Se Au to c r	b i les to m o

GRAMMER GROUP – FINANCIAL KEY FIGURES

5-year development

[ I F R S, i € i l l i ] n m o n	2 0 1 6	2 0 1 5	2 0 1 4	2 0 1 3	2 0 1 2
G R r o p e e n e u v u	1, 6 9 5. 5	1, 4 2 5. 7	1, 3 6 5. 9	1, 2 6 5. 7	1, 1 3 3. 0
E B I T D A	1 2 0. 2	8 3. 2	9 3. 7	9 2. 3	7 8. 1
E B I T D A- M i a r g n	7. 1 %	8 % 5.	6. 9 %	3 % 7.	6. 9 %
E B I T	7 3. 0	4 2. 7	0 5 7.	8. 0 5	4 9. 0
E B I T- M i a r g n	4. 3 %	3. 0 %	4. 2 %	4. 6 %	4. 3 %
P f i f t t t r o a e r a e s x	4 2 5.	2 3. 8	3 3. 6	2 9. 6	2 6. 8
S E P i € n	4. 0 1	2. 1 0	3. 0 9	2. 6 7	2. 3 8
D i i d d / S h i € v e n a r e n	1. 3 0	0. 7 5	0. 7 5	0. 6 5	0. 5 0
T l A t t o a s s e s	1, 0 5 0. 6	9 9 2. 1	8 3 6. 5	7 6 6. 0	6 6 8. 8
E i t q u y	2 1. 2 7	2 3. 4 5	2 3 1. 8	2 2 4. 7	2 1 0. 3
E i -R i t t q a o u y	2 6 %	2 6 %	2 8 %	2 9 %	3 1 %
N F i i l D b t t e n a n c a e	1 3 9. 1	1 5 5. 5	8 6. 7	9 3. 2	7 6. 5
G i R i t e a r n g a o	5 1 %	6 1 %	3 7 %	4 1 %	3 6 %
C ( / M & A ) a p e x w o	6. 2 5	4 7. 9	5 1. 5	4 6. 8	3 9. 0
D i i t e p r e c a o n	4 2 7.	4 0. 5	3 6. 7	3 4. 3	2 9. 1
E l ( D 3 1 ) m p o y e e s e c. )	1 2, 2 0 5	1 1, 3 9 7	1 0, 0 0 7	1 0, 0 8 2	8, 6 2 0

Copyright 2017 GRAMMER AG - Presentation 1-9 2017

GRAMMER GROUPFinancial Calendar and IR Contact

F i i l C l d 2 0 1 8 n a n c a a e n a r		I t n v e s o r	R l i C t t t e a o n s o n a c
C F Y 2 0 1 A l f 7 t n a y s o n e r e n c e I i M t t n e r m a n a g e m e n S Q / 1 2 0 1 8 t t t a e m e n s	M h 2 1, 2 0 1 8 a r c M 1 4, 2 0 1 8 a y	R l f H a o p V P Inv to es Ma ke ing t r P h o n e : F a x : E i l m a : I t t n e r n e	p e Re la ion Co ica ion t t r s, m m un s, & S ic Pr du P lan ing tra te t g o c n ( ) 4 9 0 9 6 2 1 6 6 2 2 0 0 + 4 9 ( 0 ) 9 6 2 1 6 6 3 2 2 0 0 + @ i l i t t n v e s o r- r e a o n s g r a m m e r. c o m / i l i t t : w w w g r a m m e r. c o m n v e s o r- r e a o n s

GRAMMER GROUPLegal Disclaimer

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