Nordex SE — Call Transcript 2013

Aug 15, 2013

Nordex SE Conference Call H1 2013

AGENDA

1. Highlights Dr. J. Zeschky 2. Market update Dr. J. Zeschky 3. Business performance Dr. J. Zeschky 4. Financials B. Schäferbarthold 5. Summary and guidance 2013 Dr. J. Zeschky 6. Appendix

• Order Intake, sales and EBIT H1 above targets
• Strategy implementation on track – operational improvements
• First turbines of the Delta Generation installed

Raising Guidance 2013 for all major KPIs

Sources: GWEC; MAKE Consulting

• MAKE forecast for 2013-17 slightly downgraded but global WTG installations to grow with a CAGR of >4%
• Demand in Northern European focus markets in line or above global average
• Southern Europe held back by the credit crisis, all in all still stable thanks to Turkey and France
• USA: Main reason for market decline in 2013 due to late PTC/ITC- extension; pricing pressure from shale gas
• Asian volume driven by China but market price still under pressure - Tier II markets such as Pakistan, Philippines or Thailand slowly developing
• RoW: South Africa and countries in North Africa emerging
• Onshore WTGs account for >90 % of the market potential

2. MARKET UPDATE – CURRENT DEVELOPMENTS

• Continuing global demand for N117/2400
• First major order for the Delta generation from Sweden
• Strong order book in Germany and rest of Northern Europe, Turkey and South Africa
• High production capacity utilization in the nacelle assembly in Rostock on a single shift basis
• Organizational adjustments in the US being implemented
• Assembly of nacelles for the remaining projects end of production and closure of the factory in Jonesboro planned for Q1 2014
• Sale of own developed project Beebe 1B to Exelon (46.6 MW)
• Ongoing project development and sales activities in LatAm (esp. Uruguay, Chile, Honduras) and the USA

Americas

• Organizational adjustments in China being implemented
• Assembly of nacelles for the remaining projects end of production and closure of the factory in Yinchuan planned for Q3 2013
• Sales focus outside China (e.g. Pakistan, Philippines, Vietnam, Thailand)

No additional exceptionals in 2013 – all costs fully covered in 2012

Order backlog

• •EUR 1.300 Mio. (+50 % yoy)
• •Sales target 2013 fully covered by existing backlog

Installations

• •560.8 MW (+96 % yoy)
• •Major markets in EMEA: Germany (109 MW), UK (100 MW) and Turkey (87.5 MW)

Service

• •Sales up 7 % (H1 2013: EUR 63.0 mn vs H1 2012 EUR 58.7 mn)
• •Performance in line with budget (sales and EBIT)
• •Global WTG availability >98 %

Production

• •Turbine production: 657.2 MW (+93 % yoy)
• •Blade production: 76.1 MW (-38 % yoy) due to changeover to NR 58.5 blade type

Development of turbine production in Rostock H1 2011 – H1 2013 (in MW)

• Efficiency gains lead to 30 % increase in weekly turbine production
• Assembly time cut by 25 % as a result of changes in process, improved tooling and changes in the assembly layout
• Improvements achieved without any disruption to ongoing production

3. BUSINESS PERFORMANCE - SIGNIFICANT PROGRESS FOR THE DELTA GENERATION

• First turbines of the Delta Generation installed in Janneby, Northern Germany (N100/3300 on 100m tower; N117/3000 on 91m tower)
• Important certificates achieved to ensure the main approvals and permissions:
• International: DECS/IEC 61400
• Germany: DIBt
• First major order from developer O2 for the Swedish project Maevaara (72 MW; 24x N117/3000; 120m tower)

4. FIRM ORDER INTAKE

• Order intake of EUR 839.4 mn best H1 ever
• 86 % from EMEA region main markets Germany, Turkey, Scandinavia, South Africa
• Bestselling turbine N117/2400 with a share of 60 %

Development of firm order backlog 2012 – H1 2013 (in EUR mn)

• Firm order backlog now at EUR 1,300 mn (30.06.2012: EUR 873 mn)
• Thereof 90 % EMEA but low exposure to Southern European countries affected by the debt crisis (<5 % )
• Conditional order backlog at EUR 1.018 mn

In EUR mn

	H1 2013	H1 2012	∆ in %
Sales	660.6	421.1	56.9
Total revenues	683.7	435.4	57.0
Cost of materials	(534.2)	(339.3)	57.4
Gross profit	149.5	96.1	55.6
Personnel costs	(74.7)	(67.2)	11.1
Other operating (expenses)/income	(41.6)	(27.5)	51.3
EBITDA	33.2	1.4	>100
Depreciation	(18.3)	(14.5)	25.5
EBIT	15.0	(13.1)	>100
Net financial result	(12.5)	(11.0)	13.3
EBT	2.6	(24.1)	>100
Tax	(1.3)	0.8	(>100)
Net Profit	1.3	(23.3)	>100

• Sales increase of 57 % due to strong business in EMEA (share of 93 %)
• Improvement in gross profit by 56 %
• Increase in structural costs (+23 % yoy) well below sales increase (+57 % yoy), despite additional costs for new country organisations

In EUR mn

	H1 2013	H1 2012
Net result	1.3	(23.3)
Depreciation	18.3	14.5
Change in working capital	(33.4)	19.1
Other cash outflow from operating activities	(25.2)	(14.3)
Cash flow from operating activities	(39.1)	(4.0)
Cash flow from investing activities	(33.0)	(21.0)
Cash flow from financing activities	(23.7)	(13.1)
Change in liquidity from cash flows	(95.8)	(38.1)
Liquidity beginning of period	274.8	212.0
Other	(4.3)	(1.2)
Liquidity end of period	174.7	175.1

• Working capital ratio of 9.5% stable since end of 2012(FY 2012: 8.7%) and significantly lower yoy (H1 2012: 21.4 %)
• Higher cash outflow from financing activities due to a redemption payment (credit facility in China)
• Investment focus on product development, upgrade of the German plants for the Generation Delta and the NR 58.5 blade

Quarterly development of inventories and working capital ratio 2010 – Q2 2013

• Strict working capital management resulted in a low working capital ratio of 9.5 % despite higher business volume
• Inventories stable despite high project volume in the next quarters

In EUR mn

	H1 2013	FY 2012		H1 2013	FY 2012
Liquid funds	174.7	274.8	Current bank borrowings	8.4	27.5
Trade receivables and future receivables	260.5	245.9	Trade payables	214.0	189.4
Net inventories	228.2	224.3	Other current liabilities	283.5	338.2
Other current assets	84.6	68.8
Current assets	748.0	813.8	Current liabilities	505.9	555.1
Property, plant, equipment	108.3	103.0	Non-current bank borrowings	21.1	25.3
Capitalized R&D expenses	86.5	77.5	Deferred tax liabilities	19.2	16.5
Deferred tax assets	41.6	42.6	Bond1	162.8	169.5
Other non-current assets	30.8	29.2	Other non-current liabilities	17.9	20.7
Non-current assets	267.1	252.3	Non-current liabilities	221.0	232.0
			Shareholders´ equity	288.2	279.0
Total assets	1,015.1	1,066.1	Total assets	1,015.1	1,066.1

¹ Bond incl. accrual interest

• Liquid funds decreased due to higher purchasing volume and increased production for the large order backlog
• Net debt position of EUR -18 mn
• Equity ratio slightly improved slightly to 28.4 % (31.12.2012: 26.2%)

5. SUMMARY AND GUIDANCE 2013

• H1 2013 above our expectations
• Order intake momentum strong
• Sales target 2013 fully covered by strong order backlog
• A yield-driven product mix (esp. N117/2400), improvements in cost-cutting (CORE 15) as well as operational excellence will drive the EBIT-margin

	Guidance old	Upgrade	Guidance new
Order Intake [EUR]	EUR 1.2 - 1.3 bn	+ EUR 100 mn	EUR 1.3 - 1.4 bn
Sales [EUR]	EUR 1.2 – 1.3 bn	+ EUR 100 mn	EUR 1.3 - 1.4 bn
EBIT	2 – 3 %	+ 0.5 % pts.	2.5 – 3.5 %
Working capital ratio	15 %	Max. - 5 % pts.	10 - 15 %

Date	Event
15 August 2013	Interim report for the first half 2013; Analyst Call
16-17 September 2013	Capital Markets Day (Frankfurt/Main)
25 September 2013	UniCredit German Investment Conference (Munich)
26 September 2013	Macquarie Alternative Energy Conference (London)
8-9 October 2013	Deutsche Börse Sector Conference (Stockholm)
14 November 2013	Interim report for the third quarter 2013; Analyst Call
27-28 November 2013	Bankhaus Lampe Hamburg Investment Conference
28 November 2013	HSBC Zurich Conference

On the basis of 73.529 mn shares, as of August 2013

DISCLAIMER

The targeted goals in this document reflect forward looking statements which are based solely on estimates and not on predictable risks.

Should the estimates with regard to the successful integration of acquisitions and the future internal growth of the company not to be realized or if other unpredictable risks should arise, it cannot be ruled out that the actual financial results of the company will differ substantially from the targeted goals as laid out in this document.

In this respect Nordex SE is unable to give a guarantee that the actual financial results of the company will not differ from any forecasts or guidance given.

MANY THANKS FOR YOUR ATTENTION.

Ralf Peters

Head of Corporate Communications Phone: +49 (0)40 30030 1522 Fax: +49 (0)40 30030 1333 eMail: rpeters@nordex-online.com

Oliver Kayser

Investor Relations Manager Phone: +49 (0)40 30030 1024 Fax: +49 (0)40 30030 1333 eMail: okayser@nordex-online.com

Nordex SE

Langenhorner Chaussee 600, 22419 Hamburg, Germany www.nordex-online.com