Hexagon Composites — Investor Presentation 2010

Aug 27, 2010

HEXAGON COMPOSITES

Presentation Half year interim report 2010

27 August

Erik Espeset, Group President
Tor Olsen Husø, CFO

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Agenda - Half year interim report 2010

• Brief Hexagon Composites overview
• Key figures
• Business Units
• Group financials
• Summary & Outlook 2010
• Q & A

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Hexagon Composites ASA

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Key figures Q2 comparison

Key figures (NOK 1000)	Q2 2010	Q2 2009	Change
Sales Revenue	231.912	229.539	1%
EBITDA	43.539	38.782	12%
EBIT	24.488	24.141	1%
EBIT %	10,6 %	10,5 %
Profit before tax	24.278	16.641	46%

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HEXAGON
COMPOSITES

Q2 2010 - Business Units

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RAGASCO

Key points

• Rebuilding of production line finalised
• New large order from PDVSA Gas Communal in Venezuela for delivery of 300 000 LPG containers
• Contract with Daimler-Benz for the supply of CNG gas tanks to the new Mercedes B-Class model
• Returned to operating profit margin of 20 % in Q2
• The market for LPG containers is good - expected good sales in Q3
• Composite Scandinavia integration process started

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RAGASCO

Q2 Financials – Composite containers

RAGASCO
	Q2 2010	Q2 2009	Change
Total Sales	118.827	120.900	-2.073
EBITDA	37.060	36.886	174
EBIT	23.821	27.100	-3.279
EBIT %	20,05 %	22,42 %

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RAGASCO

Q2 Financials – Last 2 quarters

	Q2 2010	Q1 2010	Change
Total Sales	118.827	66.803	52.024
EBITDA	37.060	8.708	28.352
EBIT	23.821	1.420	22.401
EBIT %	20,05 %	2,13 %

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LINCOLN COMPOSITES A Member of Hexagon Composites Group

Raufoss FUEL SYSTEMS

Key points & outlook

• CNG Buses - TUFFSHELL®
• Positive market development in North America
• Extraordinary costs in connection with closure of old factory

• Strong order book for 2010

• TITAN™

• First quarter with commercial deliveries
• Strong order book for 2010
• 2010 production capacity approx. 50 modules

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LINCOLN COMPOSITES A Member of Hexagon Composites Group

Raufoss FUEL SYSTEMS

Q2 Financials - High Pressure Containers

Lincoln Composites / Raufoss Fuel Systems
	Q2 2010	Q2 2009	Change
Total Sales	82.002	72.853	9.149
EBITDA	9.565	10.056	-491
EBIT	5.845	7.474	-1.629
EBIT %	7,13 %	10,26 %

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LINCOLN COMPOSITES A Member of Hexagon Composites Group

Raufoss FUEL SYSTEMS

Q2 Financials – Last 2 quarters

	Q2 2010	Q1 2010	Change
Total Sales	82.002	51.530	30.472
EBITDA	9.565	2.726	6.839
EBIT	5.845	-226	6.071
EBIT %	7,13 %	-0,44 %

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DEVOLD

AMT Advanced Multiaxial Technology

Key Points & outlook

• Improved results in Q2
• Increasing sales volume with existing customers
• Stable market in Europe
• Market growth in China and North America
• Devold PPG (J/V in USA) achieved a break-even result in Q2

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DEVOLD

AMT

Advanced Multiaxial Technology

Q2 Financials - Composite Reinforcements

Devold AMT
	Q2 2010	Q2 2009	Change
Total Sales	31.797	36.295	-4.498
EBITDA	-484	-5.687	5.203
EBIT	-2.575	-7.960	5.385
EBIT %	-8,10 %	-21,93 %

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DEVOLD

AMT

Advanced Multiaxial Technology

Q2 Financials - Last 2 quarters

	Q2 2010	Q1 2010	Change
Total Sales	31.797	23.718	8.079
EBITDA	-484	-7.072	6.588
EBIT	-2.575	-9.656	7.081
EBIT %	-8,10 %	-40,71 %

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HEXAGON
COMPOSITES

Q2 2010 - Group Financials

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Profit and Loss Account Q2 2010

Key figures (NOK 1000)	Q2 2010	Q2 2009	Change
Sales Revenue	231.912	229.539	1%
EBITDA	43.539	38.782	12%
EBIT	24.488	24.141	1%
EBIT %	10,6 %	10,5 %
Profit before tax	24.278	16.641	46%

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Turnover per Business Unit

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Balance sheet as per 30.06.2010

Assets

Balance Sheet - Assets	30.06.2010	31.03.2010	Change
Intangible assets	140.455	142.896	-2.441
Tangible fixed assets	327.423	318.383	9.040
Investments in associates	5.746	5.949	-203
Other financial fixed assets	1.005	1.044	-39
Inventories	114.419	95.987	18.432
Receivables	214.391	188.352	26.039
Bank deposits, cash and similar	9.298	11.391	-2.093
Total Assets	812.736	764.002	48.734

(NOK 1000)

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Balance sheet per 30.06.2010

Liabilities and Equity

Balance Sheet - Liabilities and Equity	30.06.2010	31.03.2010	Change
Paid-in capital	177.888	177.619	269
Other equity	69.249	77.151	-7.902
Provisions	26.254	20.722	5.532
Interest-bearing long-term liabilities	315.324	319.140	-3.816
Interest-bearing current liabilities	45.387	28.846	16.541
Other current liabilities	178.634	140.523	38.111
Total Liabilities and Equity	812.736	764.002	48.734

(NOK 1000)

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Balance sheet as per 30.06.2010

Assets

Balance Sheet - Assets (NOK 1 000)	30.06.2010	30.06.2009	Change
Intangible assets	140.455	122.827	17.628
Tangible fixed assets	327.423	272.117	55.306
Investments in associates	5.746	57.845	-52.099
Other financial fixed assets	1.005	834	171
Inventories	114.419	134.122	-19.703
Receivables	214.391	181.123	33.268
Bank deposits, cash and similar	9.298	6.712	2.586
Total Assets	812.736	775.579	37.157

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Balance sheet per 30.06.2010

Liabilities and Equity

Balance Sheet - Liabilities and Equity	30.06.2010	30.06.2009	Change
Paid-in capital	177.888	176.789	1.099
Other equity	69.249	55.553	13.696
Provisions	26.254	27.018	-764
Interest-bearing long-term liabilities	315.324	308.538	6.786
Interest-bearing current liabilities	45.387	52.772	-7.385
Other current liabilities	178.634	154.908	23.726
Total Liabilities and Equity	812.736	775.579	37.157

(Nok 1000)

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Cash Flow Statement as at 30.06.2010

Cash Flow Statement (NOK 1000)	30.06.2010
Profit before tax	17.308
Depreciation and write-downs	31.874
Change in net working capital	12.960
Net cash flow from operations	62.141
Net cash flow from investment activities	-62.166
Net cash flow from financing activities	-37.241
Net change in cash and cash equivalents	-37.265
Cash and cash equivalents at start of period	46.563
Cash and cash equivalents at end of period	9.298
Available unused credit facility	85.795

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HEXAGON
COMPOSITES

Summary & Outlook

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Summary

• Very good results in Q2 2010 – Ragasco back on track
• Rebuilding completed
• Integration of Composite Scandinavia AB started
• Contract with Daimler-Benz for the supply of CNG gas tanks to the new Mercedes B-Class model

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Summary

Raufoss

FUEL SYSTEMS

• CNG Buses - TUFFSHELL®
• Positive market development in North America
• Extraordinary costs in connection with closure of old factory

• Order book for 2010 of 11 MUSD

• TITAN™

• First quarter with commercial deliveries
• Order book for 2010 of 5 MUSD
• 2010 production capacity approx. 50 modules

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Summary

DEVOLD

• Positive results due to new top management
• Growth in global market
• Continued turnover growth in second half 2010
• Possible penalty duties on Chinese glass fiber

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HEXAGON
COMPOSITES

Q2 2010 - Q & A