Interpump Group — Investor Presentation 2016

Nov 10, 2016

Presentation to Analysts and Investors

Disclaimer

This document has been prepared by Interpump Group S.p.A for use during meetings with investors and financial analysts and is solely for information purposes. The information set out herein has not been verified by an independent audit company. Neither the Company nor any of its subsidiaries, affiliates, branches, representative offices (the "Group"), as well as any of their directors, officers, employees, advisers or agents (the "Group Representatives") accepts any responsibility for/or makes any representation or warranty, express or implied, as to the accuracy, timeliness or completeness of the information set out herein or any other related information regarding the Group, whether written, oral or in visual or electronic form, transmitted or made available.

This document may contain forward-looking statements about the Company and/or the Group based on current expectations and opinions developed by the Company, as well as based on current plans, estimates, projections and projects of the Group. These forward-looking statements are subject to significant risks and uncertainties(many of which are outside the control of the Company and/or the Group) which could cause a material difference between forward-looking information and actual future results.

The information set out in this document is provided as of the date indicated herein. Except as required by applicable laws and regulations, the Company assumes no obligation to provide updates of any of the aforesaid forward-looking statements. Under no circumstances shall the Group and/or any of the Group Representatives be held liable (for negligence or otherwise) for any loss or damage howsoever arising from any use of this document or its contents or otherwise in connection with the document or the aforesaid forward-looking statements. This document does not constitute an offer to sell or a solicitation to buy or subscribe to Company shares and neither this entire document or a portion of it may constitute a recommendation to effect any transaction or to conclude any legal act of any kind whatsoever.

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Presentation to Analysts and Investors

Table of Contents

9M 2016 & FY 2015 Highlights	3
Who We Are	9
International Profile	19
2016 Acquisitions	23
Appendix: History in Numbers	26

€ mn

	9M 2015	9M 2016	Change
SALES	681.9	693.0	+1.6%
EBITDA	141.3	151.6	+7.3%
% on sales	20.7%	21.9%
NPAT	101.3*	73.6	-27.4%
% on sales	14.9%	10.6%
NET DEBT (30/09)
Net Financial Position	283.1	286.3	+3.3 mn
Valuation of Put Options	25.0	39.8	+14.8 mn
TOTAL DEBT	308.1	326.1	+18.1 mn
TREASURY SHARES (30/09)
Number of shares	2,007,606	2,380,752

*Included one-off financial income of € 32 mn arising from put options exercised earlier than expected

9M 2016 Highlights by Sector

	SALES			EBITDA
	9M 2015	9M 2016	Change	9M 2015	% on sales	9M 2016	% on sales	Change
HYDRAULICS	430.0	446.2	+3.8%	77.4	18.0%	87.9	19.7%	+13.5%
WATER JETTING	251.9	246.8	-2.0%	63.9	25.2%	63.7	25.7%	-0.2%
TOTAL	681.9	693.0	+1.6%	141.3	20.7%	151.6	21.9%	+7.3%

€ mn

	FY 2014	FY 2015	Change
SALES	672.0	894.9	+33.2%
EBITDA	136.1	180.3	+32.4%
% on sales	20.3%	20.1%
NPAT	57.7	118.3*	+104.9%
% on sales	8.6%	13.1%
NET DEBT (31/12)
Net Financial Position	152.0	255.0	+103.0 mn
Valuation of Put Options	74.1	23.2	-50.9 mn
TOTAL DEBT	226.1	278.2	+52.1 mn
	TREASURY SHARES (31/12)
Number of shares	5,281,095	1,125,912

*Included one-off financial income of € 32 mn arising from put options exercised earlier than expected

FY 2015 Highlights by Sector

€ mn

	SALES			EBITDA
	FY 2014	FY 2015	Change	FY 2014	% on sales	FY 2015	% on sales	Change
HYDRAULICS	396.2	560.3	+41.1%	69.4	17.5%	96.6	17.2%	+39.3%
WATER JETTING	275.8	334.7	+21.3%	66.7	24.1%	83.7	24.9%	+25.4%
TOTAL	672.0	895.0	+33.2%	136.1	20.3%	180.3	20.1%	+32.4%

Sales Trend, 2005-2015

Sales* in € mn

Acquired business (first 12 months' turnover of acquired companies) Organic business

Financial Ratios

Prudent debt policy and satisfactory return on capital employed

Net Debt / EBITDA (12 M)

Net of treasury stock and including commitmentsfor purchase of investments

Return On Capital Employed (12M)

Operating profit / (consolidated shareholder's equity + net debt)

*without the Cleaning Sector

FINANCIALS

Who We Are

Water-Jetting Hydraulics

• World leader in the niche market of highpressure plunger pumps for water and other fluids. Premium-price, reputable brands.
• Growing range of applications:
• •Industrial Cleaning
• •Chemical, Food, Pharma, Cosmetic processing

• •Automotive, Marine, Oil&Gas, Tunneling, Mining, Steel Industry

• Global supplier of hydraulic parts and complete systems.

• Co-design and direct sales to all major OEMs, plus an extensive network of distributors.
• Main applications are Trucks, Industrial Vehicles, Earth-moving, Agriculture, Construction, Lifting, Machine tools, Tunneling

Competitive Scenario

The Largest Player and Worldwide Leader in the Niche Business of Very High Pressure Plunger Pumps

Main Companies and Brands

August 2016

Plunger pumps high flow/ high pressure (1~450 HP)	High-pressure pumps (up to 1,500 HP - 4,500 bar/65K PSI) Design and supply of turnkey solutions	Production and rental of high-pressure pumps and complete systems	Homogenizers for food, cosmetics, and pharmaceutical industry	Specialized solutions for steel and mining industry
INTERPUMP Pratissoli	Hammelmann	NLB	Bertoli	Inoxihp (53%)
U.S. Distributor General Pump
	International presence	(plants	and subsidiaries)
Italy, USA, China	Germany, USA, Australia, China, Spain	USA, Poland	Italy	Italy

WATER JETTING

Growth Driver: New Applications

Continuosly expanding the scope of high-pressure technology

with countless opportunities for acquisitions

HYDRAULICS

Main Companies and Brands

August 2016

Power Take-Offs Valves

INTERPUMP HYDRAULICS, Muncie Power Products, PZB, Hydrocar, Takarada

Cylinders

Panni Oleodinamica Contarini Penta, Modenflex

Oil Tanks

American Mobile Power

Distributor for Oceania

Mega Pacific (65%)

WALVOIL Hydrocontrol Galtech M.T.C.

International presence (plants and subsidiaries)

Italy, USA, UK, France, Bulgaria, Brazil, Chile, Peru, China, India, Australia, New Zealand, South Africa, UAE

Italy, USA, Canada, France, India, China, Korea, Australia Italy, France, Germany, Romania, UK, South Africa

Earth Moving Leader in Mini Escavator Control Valves. Lifting / Construction

Machine Tools

Growth Driver: Cross-Selling

HYDRAULICS

Expanding our value proposition from single components to pre-assembled kits and tailor-made solutions

Who We Are – A Well-Diversified Business

Sales by channel and application field

Diversification of our business is the key to our resilience and low overall cyclicality

Truck 23%

Cleaning 12%

Contractors 12%

Other

Industries 10% Earth Moving

9%

Who We Are – A Well-Diversified Business

Application fields by sector (dealers not included)

Worldwide Direct Presence

Water Jetting Sector Hydraulic Sector

AREA	PLANTS	EMPLOYEES
ITALY	3	504
REST OF EUROPE	1	350
NORTH AMERICA	2	306
REST OF THE WORLD	2	45
TOTAL	8	1,205

AREA	PLANTS	EMPLOYEES
ITALY	11	2,257
REST OF EUROPE	4	321
NORTH AMERICA	5	473
REST OF THE WORLD	10	855
TOTAL	30	3,906

Focus on emerging markets: a well-balanced presence

Geographical breakdown of sales and production

Geographical breakdown of sales by sector

Total Turnover: Euro 560 Million (2015)

2016 Acquisitions: Tubiflex HYDRAULICS

Tubiflex, headquartered near Turin (Italy) is a company manufacturing and selling flexible metal and non-metal hoses, metal expansion joints, metal bellows, corrugated hoses heat exchangers, special products.

Main Figures	2015 (€ mn)
SALES	22.8
EBITDA	5.3 23.4%
NET CASH	3.9

Total acquisition price, for 80%

€ 26.95 million

€ 5.39 million Payment: through the sale of 449,160 listed shares of Interpump Group S.p.A. and through the payment of € 21.56 million in cash.

2016 Acquisitions: Tekno Tubi

Tekno Tubi, headquartered near Ferrara (Italy) is a company operating in bending and assembly of rigid pipes in steel and other metals, and assembly of fitted flexible hoses in rubber or other plastic materials for hydraulics and automotive

mn)
11.2
1.4 12.5%
4.5
	2015 (€

Total acquisition price, for 100%

€ 4.1 million (in cash)

Mega Pacific, founded in 1985, is one of the leading distributors of hydraulic products in Oceania, with seven branches across Australia and New Zealand. A giant leap in Interpump's direct presence in the area.

SALES 19.0	Main Figures (AUD mn) 12 months ended	30/06/2015
	EBITDA		3.7 19.5%

Total acquisition price, for 65%

12 million AUD (in cash)

Governance and Stock Performance

Management Team

Fulvio Montipò	Chairman & CEO
Paolo Marinsek	Deputy Chairman & CEO
Carlo Banci	CFO

Shareholders Structure

Interpump Stock Performance

Total return to shareholders since the IPO: 11.88% per year (assuming dividend reinvestment and participation to the '09 capital increase)

November 7, 2016
Share price	14.40
Market Capitalization	€ 1,568 mn
Performance 3 M:	-0.83%
Performance 1 Y:	-3.27%
Performance 2 Y:	+38.11%
Average daily Volume (2016)	287,594

Procurement Costs

IPG has an excellent track record in keeping procurement costs well under control.

Free Cash Flow

Free Cash Flow 12 Months
(euro/million)	2009	2010	2011	2012	2013	2014	2015
Cash Flow from Operations	25.2	54.6	60.8	65.6	65.3	95.8	120.2
Working Capital	44.4	10.1	(21.8)	(12.3)	(1.7)	(23.7)	(6.6)
Capex	(9.2)	(8.7)	(11.8)	(15.8)	(29.8)	(34.1)	(28.9)
Other	2.7	1.0	3.7	3.6	0.5	0.3	0.5
Free Cash Flow	63.1	57.0	30.9	38.6	34.3	38.3	85.2

Return to Shareholders – 1997-2015

From 1st Jan '97 to 31 Dec '15

	Euro/million
Operating cash flow		971
Capital expenditures		(312)
Net cash flow before acquisitions and dividends		659
Dividends	(317)
Buy back	(49)	(256)*
Share capital increase	110
Sub-total		403
Acquisitions		(840)
Disposal of investments		225
Change in net financial position		(212)

* Since listing (Dec. 1996), IPG has returned to shareholders about 105% of the IPO capitalization

Synthesis of results (Twelve months*)

Euro/million	1996	1997	1998	1999	2000	2001	2002	2003	2004	2005 a	2006 b	2007 c	2008 d	2009 e	2010	2011 f	2012	2013 g	2014	2015
Net Sales	199.6	221.3	283.4	319.3	411.7	426.1	492.9	501.7	531.7	331.6	364.9	432.2	424.5	342.9	424.9	472.3	527.2	556.5	672.0	894.9
EBITDA	40.7	46.8	61.1	64.9	79.8	81.4	84.5	75.2	77.3	68.0	79.1	94.3	87.0	46.9	74.1	94.7	105.8	105.2	136,1	180.3
Margin	20.4%	21.2%	21.6%	20.3%	19.4%	19.1%	17.1%	15.0%	14.5%	20.5%	21.7%	21.8%	20.5%	13.7%	17.4%	20.0%	20.1%	18.9%	20.3%	20.1%
EBIT	35.5	40.5	52.4	55.1	67.2	67.6	69.2	59.2	60.5	57.4	69.7	82.2	75.7	29.2	54.7	75.7	84.1	79.2	104.4	136.9
Margin	17.8%	18.3%	18.5%	17.2%	16.3%	15.9%	14.0%	11.8%	11.4%	17.3%	19.1%	19.0%	17.8%	8.5%	12.9%	16.0%	15.9%	14.3%	15.5%	15.3%
Net Profit	7.6	13.8	16.6	22.2	19.0	21.4	21.1	14.3	19.7	27.1	41.6	42.9	40.2	14.0	27.4	42.6	53.2	44.1	57.7	118.3
Margin	3.8%	6.2%	5.9%	6.9%	4.6%	5.0%	4.3%	2.8%	3.7%	8.2%	11.4%	9.9%	9.5%	4.1%	6.4%	9.0%	10.1%	7.9%	8.6%	13.1%
Free Cash flow	8.4	9.2	32.1	26.5	42.1	19.4	17.2	15.9	1.0	52.1	37.9	32.0	22.1	63.1	57.0	30.9	38.6	34.3	38.3	85.2
Net Fin. Debt	43.0	38.8	67.9	139.3	153.2	150.7	145.4	172.3	178.4	115.8	99.9	139.6	200.5	186.5	134.9	121.6	66.1	100.3	178.8	265.1
	(net of treasury stock and including commitments for purchase of investments)
Shareholder's Equity	133.1	143.7	157.1	177.1	162.0	182.8	193.4	173.8	179.9	156.7	155.9	147.1	178.0	242.8	291.5	315.2	396.9	432.9	466.6	622,6
Debt/Equity	0.32	0.27	0.43	0.79	0.95	0.82	0.75	0.99	0.99	0.74	0.64	0.95	1.13	0.77	0.46	0.39	0.16	0.23	0.38	0.42

* From 2004 to 2015 figures are prepared in accordance with International Financial Reporting Standards (IFRS). From 1996 to 2003 figures are prepared in accordance with Italian Accounting Standards

• a) With Hammelmann 9 months, without Cleaning Sector.
• b) With Hammelmann 12 months, without Cleaning Sector.

d) With Modenflex 5 months, Contarini 2 months, IKO 1 month.

c) With NLB 11 months.

e) With H.S. Penta 6 months.

f) Without Unielectric and with American Mobile Power 9 Months.

g) With Hydrocontrol Group 8 months.

The Manager in charge of preparing the company's financial reports, Carlo Banci, declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to the document results, books and accounting records.

S.Ilario d'Enza, November 10, 2016 The Manager in charge of preparing the company's financial reports Carlo Banci