HENSOLDT AG

Investor Presentation • May 9, 2023

HENSOLDT

3M 2023 Results – Analyst & Investor Presentation

Taufkirchen, 9th of May 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 FY period ended March 31, 2023 is unaudited. 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

Structural changes in German MoD

More focus on operational capabilities and acceleration of procurement processes

German Government increased budget for military support for Ukraine by €12bn to €15bn

Opportunities for further TRML-4D and self-protection

New NATO member Finland NATO summit will take place in June

Pressure to increase spending target to above 2% of GDP

Appointment of Oliver Dörre as new CEO as of April 2024 announced

Transition of Management Board concluded

HENSOLDT set to benefit from upcoming German programs

HENSOLDT is well positioned to serve all force categories of the German Army

Update on top orders for 2023

Financials

3M 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. (3) The sum of the segments does not correspond to the total due to elimination/transversal/other items.

3M 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.

Short and mid term guidance confirmed

	2023 target(6)	Medium term target(6)
Book-to-bill ratio(1) / Order intake	1.1x - 1.2x	Orders to grow significantly faster than revenue
Revenue growth	7% - 10% with stronger growth in revenue excl. pass-through	10%(5) 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)	<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) predated Russian war against Ukraine and announcement special fund by German Government. (6) excluding material M&A.

HENSOLDT on track

Achievements	 Strong order backlog of €5.4bn  Optronics with growing top line  Efficient project execution  Strong profitability  FY 2023 guidance confirmed for all KPIs
Outlook	 First orders from special fund received  Further orders for military support for Ukraine expected short-term  Continuing close exchange with German customer  Smooth and sustainable growth in front of us, but backloaded HENSOLDT strongly positioned for upcoming growth

HENSOLDT Q&A session

HENSOLDT

Financial Section

Consolidated Income Statement

	First three months
in € million	2023	2022
Revenue	338	286
Cost of sales	-278	-241
Gross profit	60	45
Selling and distribution expenses	-27	-26
General administrative expenses	-23	-20
Research and development costs	-8	-8
Other operating income	3	4
Other operating expenses	-4	-4
Together we make Earnings before finance result and income taxes (EBIT)	2	-10
Interest income	4	2
the difference for a Interest expense	-19	-12
Other finance income / costs	-5	3
safer tomorrow. Finance result	-20	-7
Earnings before income taxes (EBT)	-17	-16
Income taxes	-3	-0
Group result	-20	-17
thereof attributable to the owners of HENSOLDT AG	-20	-16
thereof attributable to non-controlling interests	-0	-1

Consolidated Statement of Financial Position – Assets

	As at
in € million	3M 2023	YE 2022
Non-current assets	1,338	1,335
Goodwill	658	658
Intangible assets	385	384
Property, plant and equipment	125	121
Right-of-use assets	136	140
Investments and other financial assets(1)	25	23
Other non-current assets	2	2
Together we make Deferred tax assets	8	6
Current assets	1,537	1,644
Other(2)	24	30
the difference for a Inventories	579	516
Contract assets	218	182
safer tomorrow. Trade receivables	282	323
Other current assets	124	133
Cash and cash equivalents	310	460
Total assets	2,875	2,979

(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	3M 2023	YE 2022
Share capital	105	105
Capital reserve and other reserves	544	554
Retained earnings	-75	-55
Equity held by shareholders of HENSOLDT AG	574	604
Non-controlling interests	11	13
Equity, total	585	616
Non-current liabilities	1,175	1,160
Non-current provisions	302	282
Together we make Non-current financing liabilities(1)	620	621
Non-current contract liabilities	14	11
the difference for a Non-current lease liabilities	136	140
Other non-current liabilities	10	11
safer tomorrow. Deferred tax liabilities	94	94
Current liabilities	1,115	1,203
Current provisions	187	181
Current financing liabilities(2)	19	16
Current contract liabilities	427	488
Current lease liabilities	19	18
Trade payables	361	379
Other current liabilities	85	101
Tax liabilities	17	19
Total equity and liabilities	2,875	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 three months
in € million	2023	2022
Group result	-20	-17
Depreciation and amortisation	25	25
Financial expenses (net)	13	8
Change in
Provisions	26	8
Inventories	-60	-50
Contract balances	-94	-74
Together we make Trade receivables	39	56
Trade payables	-18	-15
the difference for a Other assets and liabilities	-17	-31
Interest paid	-7	-9
Income tax payments (-) / refunds (+)	-4	-2
safer tomorrow. Other(1)	-2	-3
Cash flows from operating activities	-118	-104
Acquisition / addition of intangible assets and property, plant and equipment	-25	-22
Acquisition of associates, other investments and other non-current financial assets	-3	-1
Acquisition of subsidiaries net of cash acquired	0	–
Other(2)	0	-0
Cash flows from investing activities	-27	-23

(1) Includes Impairments/reversals of impairments of inventories, trade receivables and contract assets, Other non-cash expenses/income and Income tax expense/income. (2) Includes Proceeds from sale of intangible assets and property, plant and equipment and Other cash flows from investing activities.

Consolidated Statement of Cash Flow (2/2)

	First three months
in € million	2023	2022
Cash flows from operating activities	-118	-104
Cash flows from investing activities	-27	-23
Change in other financing liabilities	-0	-0
Payment of lease liabilities	-5	-5
Cash flows from financing activities	-5	-5
Effects of movements in exchange rates on cash and cash equivalents	0	1
Net changes in cash and cash equivalents	-150	-131
Together we make Cash and cash equivalents
Cash and cash equivalents on 1 January	460	529
Cash and cash equivalents on 31 March	310	398
the difference for a

safer tomorrow.

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

		First three months
in € million	2023	2022
Order intake		347 681
Sensors		214 627
Optronics		133 55
Elimination/Transversal/Others		-1 -2
in € million
Revenue		338 286
Together we make Sensors		288 242
Optronics		51 45
the difference for a Elimination/Transversal/Others		-1 -1
in € million
safer tomorrow. Adjusted EBITDA(1)		30 17
Sensors		35 20
Optronics		-5 -3
Elimination/Transversal/Others		– 0

(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 three months
in € million	2023	2022
EBIT	2	-10
(+) Depreciation	11	11
(+) Amortisation	14	14
EBITDA	27	15
(+) OneSAPnow-related non-recurring effects	1	–
(+) Other non-recurring effects	2	2
Adjusted EBITDA	30	17

EBIT adjustments	First three months
in € million	2023	2022
EBIT	2	-10
(+) Effect on earnings from purchase price allocations	8	9
thereof intangible assets	8	9
thereof property, plant and equipment	0	0
(+) OneSAPnow-related non-recurring effects	1	–
(+) Other non-recurring effects	2	2
Adjusted EBIT	13	1

Reconciliation of reported to adjusted pre-tax unlevered FCF

	First three months
in € million	2023	2022
Cash flows from operating activities	-118	-104
Cash flows from investing activities	-27	-23
Free cash flow	-145	-127
(+) OneSAPnow-related non-recurring effects	1	–
(+) Other non-recurring effects	4	2
(+) Interest(1), income taxes(2) and M&A-activities(3)	13	12
Adjusted pre-tax unlevered free cash flow	-126	-114
Cash flows from financing activities	-5	-5

(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' and 'Other cash flows from investing activities' as reported in the Consolidated Statement of Cash Flows.

Reconciliation of reported to adjusted net income

	First three months
in € million	2023	2022
Group result	-20	-17
(+) Effect on earnings from purchase price allocations	8	9
(+) OneSAPnow-related non-recurring effects	1	–
(+) Other non-recurring effects	2	2
Adjusted net income pre-tax adjustment	-9	-6
(+) Tax adjustments(1)	-3	-3
Adjusted net income	-12	-9

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

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