HENSOLDT AG

Investor Presentation • Jul 28, 2023

HENSOLDT

H1 2023 Results – Analyst & Investor Presentation

Taufkirchen, 28th of July 2023

Thomas Müller, CEO

Christian Ladurner, CFO

Disclaimer

Forward Looking Statement

This presentation and the information contained herein are for information purposes only and should not be treated as investment advice or recommendation. It is not, and nothing in it should be construed as an offer for sale, or as a solicitation of an offer to purchase or subscribe to, any securities in any jurisdiction. Neither this presentation nor anything contained therein shall form the basis of, or be relied upon in connection with, any commitment or contract whatsoever. This presentation does not constitute a prospectus in whole or in part. This presentation may not, at any time, be reproduced, distributed or published (in whole or in part) without prior written consent of HENSOLDT. Any securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or the laws of any state of the United States, and may not be offered, sold or otherwise transferred in the United States absent registration or pursuant to an available exemption from registration under the Securities Act.

Certain financial information including financial information as of and for the H1 period ended June 30, 2023 is unaudited. The semi-annual financial report is denominated in Euro (€). All amounts in this report are rounded to million or billion Euros. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. This presentation contains certain supplemental financial or operative measures that are not calculated in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS") or any other generally accepted accounting principles, and are therefore considered non-IFRS measures. We believe that such non-IFRS measures, when considered in conjunction with (but not in lieu of) other measures that are computed in accordance with IFRS, enhance the understanding of our business, results of operations, financial position or cash flows. There are, however, material limitations associated with the use of non-IFRS measures including (without limitation) the limitations inherent in the determination of relevant adjustments. The non-IFRS measures used by us may differ from, and may not be comparable to, similarly-titled measures used by other companies.

The information contained in this presentation has not been independently verified, and no representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information contained herein and no reliance should be placed on it. HENSOLDT does not accept any liability for any loss howsoever arising (in negligence or otherwise), directly or indirectly, from this presentation or its contents or otherwise arising in connection with this presentation. This shall not, however, restrict or exclude or limit any duty or liability to a person under any applicable law or regulation of any jurisdiction which may not lawfully be disclaimed (including in relation to fraudulent misrepresentation).

The information contained in this presentation is provided as of the date of this presentation and is subject to change without notice.

This presentation may contain forward-looking statements about HENSOLDT and its businesses, including statements concerning its strategies, future growth potential of markets and products, profitability in specific areas, future product portfolio, and development of and competition in economics and markets. These statements are based on the current views, expectations, assumptions and information of management, and are based on information currently available to management. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods.

Any such forward-looking statements involve known and unknown risks which may cause actual results to differ significantly from any future results expressed or implied. While we believe that the assumptions made and the expectations reflected in today's presentation are reasonable, no assurance can be given that such assumptions or expectations will prove to have been correct. The risks and uncertainties which these forward-looking statements may be subject to include (without limitation) future market developments and the impact of global and European social, political and economic events and developments, including the Russian war against the Ukraine and COVID-19 pandemic, as well as defence and security spending by governments, legal restrictions and controls applicable to sales of HENSOLDT's products, including government approval requirements and moratoriums, international conflicts and political developments affecting HENSOLDT, including by way of new export restrictions, trade barriers, or political support for competitors, HENSOLDT's inclusion and participation in major defence projects and platforms and HENSOLDT's competitive situation.

The company assumes no liability whatsoever to update these forward-looking statements or to adjust them to future events or developments.

HENSOLDT's public reports and presentations are available via www.HENSOLDT.net

Business Update

Update on strategic topics

German program landscape solidifies – HENSOLDT well positioned

Source: Renaissance Strategic Advisors, Bundeswehr, HENSOLDT AG. Note: All based on current estimates and subject to change. (1) No Award/no order intake planned for HENSOLDT yet; (2) Original equipment manufacturer

Top orders received

HENSOLDT strives for a best-in-class compliance approach with a special focus on anti-corruption

Standards of Business Conduct

• Any partner contracting with the HENSOLDT Group is subject to the Partner Review Directive (customers, suppliers, agents, …)
• Comprehensive partner due diligence is conducted by the compliance department

H1 2023 – strong performance in top line in €m

(1) Order intake is defined as orders where the corresponding selling contract becomes effective and enforceable in accordance with the terms and conditions of the contract. (2) Order backlog is defined as the value of the order book at the respective reporting date by keeping record of customer orders starting from the opening stock and taking into account revenue and adjustments for the respective reporting period, and ending with the final stock.

H1 2023 – bottom line follows excellent top line development in €m

(1) Adjusted EBITDA is defined as EBIT adjusted for depreciation and amortization including non-recurring effects on earnings from Transaction costs, OneSAPnow-related non-recurring effects as well as other non-recurring effects. (2) Adjusted EBIT is defined as EBIT adjusted for certain non-recurring effects relating to effects effects on earnings from Transaction costs, OneSAPnow-related non-recurring effects as well as other non-recurring effects. (3) Adjusted Pre-Tax Unlevered Free Cash Flow is defined as free cash flow adjusted for non-recurring operating effects as well as interest, tax and M&A activities. The free cash flow is defined as sum of the cash flows from operating and investing activities as reported in the consolidated cash flow statement.

H1 2023 – Sensors segment in €m

(1) Order intake is defined as orders where the corresponding selling contract becomes effective and enforceable in accordance with the terms and conditions of the contract. (2) Adjusted EBITDA is defined as EBIT adjusted for depreciation and amortization (including non-recurring effects on earnings from purchase price allocations), as well as certain non-recurring effects relating to transaction costs, IPO related costs and other non-recurring effects

H1 2023 – Optronics segment in €m

(1) Order intake is defined as orders where the corresponding selling contract becomes effective and enforceable in accordance with the terms and conditions of the contract. (2) Adjusted EBITDA is defined as EBIT adjusted for depreciation and amortization (including non-recurring effects on earnings from purchase price allocations), as well as certain non-recurring effects relating to transaction costs, IPO related costs and other non-recurring effects

We secure our long-term growth

(1) Net leverage including lease liabilities, excluding pensions. (2) Includes Non-current financing liabilities, Other non-current financial liabilities, Current financing liabilities and Other current financial liabilities.

Short term guidance specified, medium term guidance confirmed

		2023 target(5)	Medium term target(5)
Book-to-bill ratio(1) / Order intake	1.1x -	1.2x	Orders to grow significantly faster than revenue
Revenue growth	Specified: ~ €1,850m with stronger growth in core revenue	old: 7%-10% with stronger growth in core revenue	10% average annual growth
Adjusted EBITDA margin(2)		~19% before pass-through revenue	>19% before pass-through revenue
Adjusted pre-tax unlevered FCF(3)		~70% average conversion on adjusted EBITDA	70% - 80% average conversion on adjusted EBITDA
Net leverage(4)	Updated: ≤1.0x	old: <1.0x	n/a
Dividend	30% -	40% of adjusted net income	30% - 40% of adjusted net income

(1) Average share of pass-through revenue of total revenue was ~10% between 2020A and 2022E; pass-through share of total revenue is expected to be in the mid single-digit percentage range between 2023E and 2025E; (2) Adjusted EBITDA margin excluding certain non-recurring effects such as Transaction costs, OneSAPnow-related non-recurring effects as well as other non-recurring effects. (3) Adjusted Pre-Tax Unlevered Free Cash Flow is Defined as free cash flow adjusted for non-recurring effects as well as interest, tax and M&A activities. (4) Net leverage includes lease liabilities, but excludes pensions; (5) excluding material M&A.

HENSOLDT GO! Wave 3 measures ready for implementation

Laying the foundation for our growth

Increase Engineering Efficiency to meet higher demand and growth

• Focus HENSOLDT engineering on high-value core competences
• Externalize standard engineering work packages
• Modularization of core components

Industrialize production processes to deliver on time, cost and quality

• Embed industrialization into design/engineering process
• Raise production efficiency through plug-and-play components

Achieve supply chain robustness to ensure availability of our products

• Create a "supply chain digital twin" of key products to assess impact of key components on value chain
• Identify alternative suppliers to reduce dependencies
• Strengthen procurement and focus on strategic and high-value add activities

ERP transformation de-risked through comprehensive set of measures

Strong backfilling agreement of 80+ FTE to assure availability of best experts for transformation ahead

Investment in an 18+ months preparation phase with various partners and challengers to sharpen the concept and approach

oneSAPnow program targets incorporated Into executive management incentive plans to keep strong involvement and focus

Strong H1 performance lays the basis for a successful year 2023

Achievements	 Record order backlog of €5.7bn  Strong order intake in first half of the year  Efficient project execution and significant increase of core revenue  Strong profitability FY 2023 guidance confirmed Revenue guidance specified, net leverage guidance updated
Outlook	 Further orders from special fund received with more orders expected short-term  Continuing close exchange with German customer  Smooth and sustainable growth in front of us HENSOLDT strongly positioned for upcoming growth

HENSOLDT

Q&A session

HENSOLDT

Financial Section

Consolidated Income Statement

	First half year
in € million	2023	2022
Revenue	726	682
Cost of sales	-602	-568
Gross profit	124	114
Selling and distribution expenses	-55	-53
General administrative expenses	-48	-43
Research and development costs	-13	-17
Other operating income	10	10
Other operating expenses	-9	-9
Together we make Other result from investments	5	–
Earnings before finance result and income taxes (EBIT)	14	2
the difference for a Interest income	11	3
Interest expense	-31	-22
safer tomorrow. Other finance income / costs	-7	5
Finance result	-27	-15
Earnings before income taxes (EBT)	-13	-13
Income taxes	-3	-3
Group result	-16	-16
thereof attributable to the owners of HENSOLDT AG	-17	-16
thereof attributable to non-controlling interests	1	-0

Consolidated Statement of Financial Position – Assets

		As at
in € million	H1 2023	YE 2022
Non-current assets	1,374	1,335
Goodwill	658	658
Intangible assets	377	384
Property, plant and equipment	128	121
Right-of-use assets	176	140
Investments and other financial assets(1)	26	23
Other non-current assets	2	2
Together we make Deferred tax assets	9	6
Current assets	1,578	1,644
Other(2)	32	30
the difference for a Inventories	629	516
Contract assets	279	182
safer tomorrow. Trade receivables	264	323
Other current assets	126	133
Cash and cash equivalents	247	460
Total assets	2,952	2,979

21

(1) Includes Other investments and other non-current financial assets, Non-current other financial assets.

(2) Includes Other non-current financial assets, due on short-notice, Other current financial assets and Income tax receivables.

Consolidated Statement of Financial Position – Equity & Liabilities

	As at
in € million	H1 2023	YE 2022
Share capital	105	105
Capital reserve and other reserves	535	554
Retained earnings	-106	-55
Equity held by shareholders of HENSOLDT AG	534	604
Non-controlling interests	14	13
Equity, total	548	616
Non-current liabilities	1,239	1,160
Non-current provisions	320	282
Together we make Non-current financing liabilities(1)	620	621
Non-current contract liabilities	22	11
the difference for a Non-current lease liabilities	178	140
Other non-current liabilities	9	11
safer tomorrow. Deferred tax liabilities	91	94
Current liabilities	1,164	1,203
Current provisions	168	181
Current financing liabilities(2)	20	16
Current contract liabilities	448	488
Current lease liabilities	17	18
Trade payables	396	379
Other current liabilities	98	101
Tax liabilities	17	19
Total equity and liabilities	2,952	2,979

(1) Includes Non-current financing liabilities and Other non-current financial liabilities.

(2) Includes Current financing liabilities and Other current financial liabilities.

Consolidated Statement of Cash Flow (1/2)

	First half year
in € million	2023	2022
Group result	-16	-16
Depreciation, amortisation and impairments of non-current assets	58	52
Financial expenses (net)	15	16
Change in
Provisions	26	-9
Inventories	-121	-83
Contract balances	-127	-148
Together we make Trade receivables	55	45
Trade payables	18	37
the difference for a Other assets and liabilities	-16	-10
Interest paid	-16	-13
Income tax payments (-) / refunds (+)	-5	-4
safer tomorrow. Other(1)	8	-1
Cash flows from operating activities	-120	-134
Acquisition / addition of intangible assets and property, plant and equipment	-48	-44
Acquisition of associates, other investments and other non-current financial assets	-4	-2
Acquisition of subsidiaries net of cash acquired	-1	-0
Other(2)	2	0
Cash flows from investing activities	-51	-46

(1) Includes Impairments/reversals of impairments of inventories, trade receivables and contract assets, Other non-cash expense/income and Income tax expense/income.

(2) Includes Proceeds from sale of intangible assets and property, plant and equipment, proceeds from disposals of associates, other investments and non-current financial assets and Other cash flows from investing activities.

Consolidated Statement of Cash Flow (2/2)

	First half year
in € million	2023	2022
Cash flows from operating activities	-120	-134
Cash flows from investing activities	-51	-46
Change in other financing liabilities	0	-13
Payment of lease liabilities	-10	-9
Dividend payments	-32	-26
Other	–	0
Cash flows from financing activities	-41	-49
Together we make Effects of changes in exchange rates on cash and cash equivalents	0	2
Net changes in cash and cash equivalents	-212	-227
Cash and cash equivalents
the difference for a Cash and cash equivalents on 1 January	460	529
Cash and cash equivalents on 30 June	247	302
safer tomorrow.

Reconciliation of order intake, segment revenue and adjusted EBITDA to group figures

		First half year
in € million		2023	2022
Order intake		1,071	948
Sensors		817	810
Optronics		257	144
Elimination/Transversal/Others		-3	-5
in € million
Revenue		726	682
Together we make Sensors		603	575
Optronics		125	109
the difference for a Elimination/Transversal/Others		-3	-2
in € million
safer tomorrow. Adjusted EBITDA(1)		82	61
Sensors		86	52
Optronics		-4	9
Elimination/Transversal/Others		–	–

(1) Adjusted EBITDA is defined as EBIT adjusted for depreciation and amortisation (including non-recurring effects on earnings from purchase price allocations), as well as certain non-recurring effects relating to transaction costs, OneSAPnow-related non-recurring effects and other non-recurring effects.

Overview of EBITDA and EBIT adjustments

EBITDA adjustments	First half year
in € million	2023	2022
EBIT	14	2
(+) Depreciation	23	22
(+) Amortization	30	30
EBITDA	66	53
(+) Effects on earnings from purchase price allocations	6	0
(+) Transaction costs	–	–
(+) OneSAPnow-related non-recurring effects	3	–
(+) Other non-recurring effects	6	7
Adjusted EBITDA	82	61

EBIT adjustments	First half year
in € million	2023	2022
EBIT	14	2
(+) Effect on earnings from purchase price allocations	22	18
thereof intangible assets	21	18
thereof property, plant and equipment	0	0
(+) Transaction costs	–	0
(+) OneSAPnow-related non-recurring effects	3	–
(+) Other non-recurring effects	6	7
Adjusted EBIT	45	27

Reconciliation of reported to adjusted pre-tax unlevered FCF

	First half year
in € million	2023	2022
Cash flows from operating activities	-120	-134
Cash flows from investing activities	-51	-46
Free cash flow	-172	-180
(+) OneSAPnow-related non-recurring effects	3	–
(+) Other non-recurring effects	9	5
(+) Interest(1), income taxes(2) and M&A-activities(3)	24	19
Adjusted pre-tax unlevered free cash flow	-136	-157
Cash flows from financing activities	-41	-49

(1) Defined as 'Interest paid' (including interest on lease liabilities) as reported in the Consolidated Statement of Cash Flows.

(2) Defined as 'Income tax payments / refunds' as reported in the Consolidated Statement Cash Flows.

(3) Defined as sum of 'Acquisition of associates, other investments and other non-current financial assets', 'Proceeds from sale of intangible assets and property, plant and equipment',

'Acquisition of subsidiaries net of cash acquired', 'Proceeds from disposals of associates, other investments and non-current financial assets' and 'Other cash flows from investing activities' as reported in the Consolidated Statement of Cash Flows.

Q2 Financial Overview HENSOLDT Group

		Second quarter
in € million	2023	2022
Order intake	724	267
Book-to-bill ratio(1)	1.9x	0.7x
Revenue	388	396
Adjusted EBIT(2)	32	26
Adjusted EBITDA(3)	52	44
Adjusted EBITDA margin	13.3 %	11.1 %
Adjusted pre-tax unlevered free cash flow(4)	-10	-43

(1) Book-to-Bill ratio is defined as order intake / reported revenue for the relevant period

(2) Adjusted EBIT is defined as EBIT adjusted certain non-recurring effects relating to transaction costs, OneSAPnow-related non-recurring effects and other non-recurring effects

(3) Adjusted EBITDA is defined as EBIT adjusted for depreciation and amortisation (including non-recurring effects on earnings from purchase price allocations), as well as certain non-recurring effects relating to transaction costs, OneSAPnow-related non-recurring effects and other non-recurring effects

(4) Adjusted pre-tax unlevered free cash flow is defined as free cash flow adjusted for non-recurring operating effects as well as interest, tax and M&A activities. The free cash flow is defined as sum of the cash flows from operating and investing activities as reported in the consolidated cash flow statement

Reconciliation of reported to adjusted net income

		First half year
in € million	2023	2022
Group result	-16	-16
(+) Effect on earnings from purchase price allocations	22	18
(+) Transaction costs	–	0
(+) OneSAPnow-related non-recurring effects	3	–
(+) Other non-recurring effects	6	10
Adjusted net income pre-tax adjustment	15	12
(+) Tax adjustments(1)	-9	-8
Adjusted net income	6	4

(1) Includes tax adjustments on effect on earnings from PPA, OneSAPnow-related non-recurring effects and other non-recurring effects

HENSOLDT

Back-up

HENSOLDT AG – H1 2023 results

Upcoming IR events*

IR Contacts

• Contact: Veronika Endres Tim Schmid
• Phone: +49 89 51518 2057 +49 89 51518 2625
• Email: investorrelations@hensoldt.net
• Internet: www.hensoldt.net

Contact HENSOLDT share Reports

• Type of share: Bearer shares
• Stock Exchange: Frankfurt Stock Exchange

• Security reference number: ISIN DE000HAG0005

• Financial Reports: https://investors.hensoldt.net

• Annual Report: https://annualreport.hensoldt.net
• Sustainability Report: www.hensoldt.net