Prima Industrie — Investor Presentation 2021

Mar 19, 2021

BUSINESS PLAN 2021-2023

ARE WE

WHO International Group with 8 manufacturing plants in 3 continents

AMERICAS of revenues 30%

EMEA of revenues 57%

Listed on Milan Stock Exchange since 1999

Focus on innovation

(5%+ yearly investment in R&D)

Direct presence in 30 countries

Large installed base in 80 countries and significant share (30%) of revenues from after-sale services

Commitment to ESG values ("green" machines, sustainable factories, diversity, gender equity, business ethics)

Company structured on 4 Business units

Machinery, Automation & Software Additive Manufacturing Solutions

Industrial Electronics Laser Sources

LASER MACHINES

SHEET METAL PROCESSING MACHINES & SYSTEMS

ADDITIVE MANUFACTURING

RANGE PRODUCT

LASER SOURCES SERVICES

RANGE PRODUCT

SOFTWARE

AUTOMATION AND STORAGE

ELECTRONICS

ARE WE

WHO A leader in laser and sheet-metal fabrication machines and systems

Strong know-how in mechatronics, opto-electronics, automation and software

SECTORS WHICH

9%

11%

Subcontractors

Machinery

Aerospace & Energy

MECHANICS & MACHINERY

ELECTRONICS, MEDICAL & OTHERS

CUSTOMERS SELECTION OF MAIN

ARE WE WHO

LASER - PUNCHING – Wujiang - Suzhou (CHINA)

LASERDYNE – Brooklyn Park - MN (USA)

5 years of investments for new efficient and sustainable plants

ARE WE WHO

100.000 m2 of plants and offices around the world

LASER – ELECTRONIC SYSTEMS Barone C.se – TO (ITALY)

TOOL MACHINE MARKET WORLD

1992 FIRST GULF WAR

56%

26% 18%

APAC

EMEA AMERICAS

METAL SHEET FABRICATION MARKET

∼15b€ (2019)

Source: Company estimates

Part of the machine tool market

2020 RESULTS REPORTED HIGHLIGHTS

Values in €/thousand	Q4 2020	ACT 31.12.20	ACT 31.12.19	Change	Change %
Order Intake	102.714	323.093	410.417	(87.324)	-21,3%
Backlog (*)	124.722	124.722	142.332	(17.610)	-12,4%
Revenues	99.511	332.963	427.582	(94.619)	-22,1%
EBITDA	12.289	27.185	38.432	(11.247)	-29,3%
EBITDA%	12,3%	8,2%	9,0%	-0,8%	N/A
EBIT	(3.733)	(5.258)	14.391	(19.649)	-136,5%
EBIT%	-3,8%	-1,6%	3,4%	-5,0%	N/A
Net Result	(3.029)	(7.414)	8.818	(16.232)	-184,1%
FCF	29.584	15.600	(4.197)	19.797	471,7%
NFP before leasing (*)	(60.542)	(60.542)	(68.471)	7.929	11,6%
NFP (*)	(96.274)	(96.274)	(107.343)	11.069	10,3%

ADJUSTED HIGHLIGHTS

Values in €/thousand	Q4 2020	ACT 31.12.20	ACT 31.12.19	Change	Change %
Revenues	99.511	332.963	427.582	(94.619)	-22,1%
EBITDA Adj	10.311	28.438	41.014	(12.576)	-30,7%
EBITDA Adj %	10,4%	8,5%	9,6%	-1,1%	N/A
EBIT Adj	4.775	6.481	18.610	(12.129)	-65,2%
EBIT Adj %	4,8%	1,9%	4,4%	-2,5%	N/A
NET RESULT Adj (**)	5.479	4.320	10.550	(6.230)	-59,1%

(% calculated over the revenues) (*value at the end of the quarter)

(** Net Result Adj includes all the NRI without tax effect)

RESILIENCE PRIMA'S

Prima Industrie Group benefits from three factors of resilience

1 a strong geographical distribution worldwide

2 a high diversification of industries served, which are impacted by

different cyclicality and diversified macro trends

3 an important share of revenues coming from after sales activities, which represent a stable source of sales linked to high number of machines installed

In order to reduce the impact of drop in revenues the Group implemented several measures to reduce costs.

• 1 Personnel costs reduction, thanks to decrease in headcount and average cost.
  -

The reduction of the average cost is due to:

REDUCTION COST ACTIONS

• Temporary lay-off and other managers' reduction of salaries (voluntary basis)
• Use of vacation/bank hours

2 Natural decrease of Travel and Exhibitions & Events costs

• 3 Reduction of other operating costs, such as: • technical and administrative consultancies
  • temporary services
  • other sundry costs

The actions concerned mainly the following costs:

2015-2020 RESULTS

-11

11

23

34

333

EBITDA MARGIN

* Net result impacted by 8.5 M€ net impairment

ASSUMPTIONS 2021

The Plan assumes, as envisaged by influential external sources (CECIMO, UCIMU), a significant recovery of the reference markets starting from mid-2021 and the beginning of a new multi-year positive cycle in the following years.

In particular, it is expected a strong growth in the Chinese market and in the APAC area in general, with AMERICAS and EMEA improving at a slower pace (possibly accelerating as a result of public support measures such as "Next Generation EU" and "Transizione 4.0").

As for reference sectors, Aerospace and Automotive are still expected to be critical in the period, although a recovery is expected compared to 2020 thanks to the contribution of the Space Economy and E-Mobility sectors.

As from Dec 20 to Feb 21 order intake for the Group was up 20%

TARGETS MAIN

GROWTH IN REVENUES TO 500+ M€

IMPROVEMENT IN MARGINALITY WITH EBITDA 13%

POSITIVE NET FINANCIAL POSITION

(EXCLUDING IMPACT FROM IFRS16 AND EXTRAORDINARY OPERATIONS)

TARGET MAIN GROUP

CUSTOMER SATISFACTION

Y T LI A U Q	E C VI R E S O T T C U D O R P M O R F	S E TI S E VI L TI A C S A R L E T A F C A O L G
PRODUCTS	COMMERCIAL STRATEGY	OPERATIONS
	PROCESS DIGITALIZATION

• NEW ORGANIZATION
  -

500+ M€ REVENUES 13% EBITDA POSITIVE NET FINANCIAL POSITION

ORGANIZATION NEW

Prima Industrie will adopt a new organization model which provides, in addition to central staff functions, four Business Units with a strong technological and regional connotation, allowing for a better focus of activities in the respective business areas.

This implies a simplification of the structure and greater decentralization of activities, which will be achieved thanks to the development of local technical skills and the introduction of digitization tools.

• Glocal approach
• Group organization flatter
• More local autonomy but increased Group control & coordination
• Manager accountability
• Talent retention

R A T I O N A L E S

IMPACT MARKET TRENDS

MACRO TRENDS SEGMENTS INVOLVED PRODUCTS EXAMPLES

Infrastructure

Urbanization & Climate change

Connectivity

E-Mobility

Space economy

Health & Well being

Green & Circular economy

Steel Furniture and Panels

Automotive Railways

Energy

Aero & Space

Healthcare & Medical

All

Building & Housing Equipment

Machinery

ENHANCEMENT OF PRESENCE IN APAC MARKET

Investments in south-east Asia, China and other APAC Countries to increase market share.

Thanks to a new Global Organisation ("thinkglobal.servelocal") oriented towards Customer Satisfaction and made possible by the Group current worldwide footprint.

IMPROVEMENT OF CUSTOMERS' SERVICE

(Already at around 30% in 2020) through a more efficient employment of human resources and new digital technologies (Remote Troubleshooting, Augmented Reality, Predictive Maintenance), already partially implemented.

EVOLUTION OF THE PRODUCT RANGE FURTHER GROWTH IN AFTER-SALE REVENUES

Through major investments in software and automation and introduction of a new family of "volume booster" products.

MAIN ACTIONS FOR TOP LINE IMPROVEMENT

Reduction of installation times and costs, also thanks to the use of new digital technologies Centralization of Procurement function

EFFICIENCIES IN INSTALLATION AND PROCUREMENT

Updating and integration of ERP and PLM systems, rollout of PST system for the After-Sale management

GREATER DIGITALIZATION OF BUSINESS PROCESSES

With the completion of the new factory in Collegno (Torino), after the actions already concluded in the recent years in Suzhou (China) Seinäjoki (Finland) and Minneapolis (USA)

RATIONALIZATION OF THE PRODUCTION FOOTPRINT

Launch of a new streaming platform called "Prima@Home" to create digital events and open houses and arrange virtual

demonstrations for customers without the need for them to move and travel to the Group's showrooms.

MAIN ACTIONS FOR MARGIN IMPROVEMENT

INDUSTRIAL ELECTRONICS

Significant growth in revenues, partly deriving from programs launched with its main customers and partly through the development of new sectors (railway and e-mobility). Profitability margins expected to remain stable over the period.

OPTOELECTRONICS AND FIBER LASER SOURCES ADDITIVE MANUFACTURING

After a previous period of strong investments and negative impact on the Group EBIT, the BU will carry out a complete turnaround during the plan period.

This will be made possible thanks to repositioning in niche sectors with better margins.

Business Unit although starting from still limited volumes of revenues, will more than double its revenues thanks to new products in the Direct Energy Deposition sector (Repairing - Circular Economy) and in the Powder Bed Fusion (Aerospace, Automotive and Energy markets).

MAIN ACTIONS FOR TOP LINE & MARGIN IMPROVEMENT

Growing commitment to sustainability and ESG targets

Machines and plants increasingly environment friendly

Particular attention to human resources representing a fundamental asset for the future of the Group (smart working, diversity, training, talent retention)

LEAD LASER 41% CALL OPTION EXERCISE AND CONSOLIDATION

• Conditions to be satisfied:
  • travels to/from China, agreement
  • with Chinese Management
• Time to exercise: March 31st, 2022

ADDITIVE MANUFACTURING BU SPIN-OFF AND MERGE WITH 3D-NT

• Aggressive product development for high productivity multi laser machines aimed to satisfy requirements of mid quantities/cost sensitive market segments such as high-end automotive and aerospace Becoming a market reference in Italy
• Value operation through much higher evaluation multiples

NOT INCLUDED UPSIDES BP