Sabaf — Investor Presentation 2015

Oct 2, 2015

FINANCIAL PRESENTATION Star Conference London, 5 & 6 October 2015

Product range

Gas valves

Single ring burners Special and multi-rings burners

Micro switches& accessories

Thermostats

Production sites

Becoming even more international

• • With over 270 customers in 60 different countries SABAF S.p.A. is a global leader in the production of gas components for domestic cooking appliances.
• •Top 10 customers account for 49% of sales (H1 2015) – stable figure for 10 years
• •Sabaf enjoys a strong leadership position in Italy and Europe (market share above 40%)
• • Demographic trends do not leave space for substantial growth in EuropeSabaf market share worldwide is still low (around 10%)
• • Efforts are mainly addressed at furtherly increasing our international presence, with special focus on:
• –Turkey
• –China
• –Brazil
• –USA
• –Iran
• –India

Sabaf in Turkey

WHY

Turkey has become the most important manufacturer of white goods in Europe (Turkish manufacturers and production sites of multinational groups)

HOW

In 2012 Sabaf built from greenfield a new factory in Manisa (Izmir) - € 10 mn investment - 10,000 sqm Manufacturing of standard burners Same products, technology and quality as in Italy

WHERE WE ARE€ 9.2 mn sales in 2014, 60 people employed 50% sales growth expected in 2015

WHERE WE WILL BEFurther expansion of production capacity is ongoing Constant growth has been planned for next years

Sabaf in China

WHY

Market size: 26 mn hobs

19 mn hobs manufactured for the domestic market

7 mn hobs manufactured for export markets

Expected product mix trend: higher value, moderate volume growth New standards concerning gas hobs apply starting from April 2015. The new standards state 3 different energy classes: 55%, 59% and 63%.

At present only 10% to 15% of hobs meet the highest class.

HOW

Sabaf has developed a new special burner that reaches an efficiency rate higher than 63%. €2mn capex in 2014-2015 in order to start production.

WHERE WE ARE

Production has started in H1 2015, € 1mn sales expected in 2015 Ongoing contacts with major hob manufacturers for a strategic agreement for the supply of safety valves

WHERE WE WILL BEWe are targeting the 10% premium market

Sabaf in Brazil

WHY

Brazil is a big market, difficult to supply from abroad, due to logistics, duties, forex impact.

HOW

Start of production in Brazil in 2001. A new factory was set up in Jundiaì (SP) in 2007, starting from greenfield. € 10 mn investment - 10,000 sqm Manufacturing of standard burners Same products, technology and quality as in Italy

WHERE WE ARE

€ 8.4 mn sales in 2014, 64 people employed 2015E flattish (drop in domestic sales balanced by growth in the rest of Latam) 80% market share in the hobs segment

WHERE WE WILL BE

Production of special burners (2016) – a new wok burner for the Brazilian marketOngoing negotiations with large multinational groups Expected increase of share in the cookers segment

Sales by product

	H 1 2 0 1 5	H 1 2 0 1 4
l B r a s s v a v e s	0 3 8 7,	6 9 2 7,	% 8 5 -
L i h l l l t g a o a e s y v v	1 8, 1 1 5	1 7, 0 2 5	% 6 4 +
T h t t e r m o s a s	5, 8 7 1	7, 2 8 4	% 1 9 4 -
S d d b t a n a r u r n e r s	1 9 2 2 9 ,	1 8 3 3 5 ,	% 4 9 +
S i l b p e c a n e s u r r	1 1, 1 2 5	1 0, 6 9 5	% 4 0 +
A i c c e s s o r e s	7, 1 7 4	6 2 6 9 ,	% 1 4 4 +
i H n g e s	3, 9 5 7	3, 9 8 5	% 0 7 -
l T t o a	2 0 9 7 5 ,	1, 2 8 7 5	% 1. 7 +

Sales by market

	H 1 2 0 1 5	H 1 2 0 1 4
I l t a y	2 2, 6 6 2	2 3, 9 7 1	% 5 5 -
W E t e s e r n u r o p e	3, 9 6 8	4 7 5 0 ,	% 1 6 5 -
E E t a e e s r n u r o p	1 8 9 4 7 ,	1 1 8 8 7,	% 1 0 2 +
M i d d l E A f i & t e a s r c a	9, 0 0 2	9, 5 9 2	% 6 2 -
O A i & i s a c e a n a	3, 1 5 1	2, 8 1 4	% 1 2 0 +
i A i L t a e a n m r c	1 0, 4 2 1	9, 0 7 5	% 6 9 +
N h A i t o r m e r c a	4 3 5 8 ,	3, 2 2 0	% 3 3 5 +
T l t o a	7 2 5 0 9 ,	7 1, 2 8 5	% 1. 7 +

Income statement

€ x 0 0 0	H 1 2 0 1 5		H 1 2 0 1 4			F Y 2 0 1 4
S S A L E	7 2, 5 0 9	% 1 0 0. 0	7 1, 2 8 5	% 1 0 0. 0	% 1. 7 +	1 3 6, 3 3 7	% 1 0 0. 0
M i ls t a e a r	( ) 2 8, 8 5 3	% 3 9. 8 -	( ) 6 2 9, 3 7	% -4 1. 6		( ) 5 4, 4 7 2	% 4 0. 0 -
P l l ay ro	( ) 1 7, 0 6 0	% 2 3. 5 -	( ) 6, 1 7 9 3	% -2 3. 6		( ) 3 2, 1 8 0	% 2 3. 6 -
C h in k t a n g e s o c	1, 8 7 7	% 2. 6	4 2, 5 1	% 3. 4		2, 4 4 7	% 1. 8
O h in in / t t t e r o p e r a g c o s s c o m e	( ) 1 4, 1 0 9	% 1 9. 5 -	( ) 4 1 3, 3 9	% -1 8. 7		( ) 2 6, 1 8 0	% 1 9. 2 -
E B I T D A	1 4, 3 6 4	% 1 9. 8	1 3, 9 5 7	% 1 9. 6	% 2. 9 +	2 5, 9 5 2	% 1 9. 0
D i io t e p r e c a n	( 6, 0 1 9 )	8. 3 % -	( 6, 2 9 ) 7	8. 8 % -		( 1 2, 2 9 2 )	9. 0 % -
G in / lo f ix d t a s s s e s o n e a s s e s	4 5	0. 1 %	2 4	0. 0 %		6 3	0. 0 %
Im irm f f ix d t t a e e a s s e s p n o	0	% 0. 0	0	% 0. 0		( ) 5 4 8	% 0. 4 -
E B I T	8, 3 9 0	% 1 1. 6	7, 7 0 2	% 1 0. 8	% 8. 9 +	1 3, 1 7 5	% 9. 7
f in i l N t e a nc a e xp e ns e	( ) 2 8 7	% 0. 4 -	( ) 2 6 5	% -0 4		( ) 5 3 1	% 0. 4 -
h lo Fo i in / r e g n e xc a n g e g a s s s e s	1 2 0	% 0. 2	1 3	% 0. 0		1 1 9	% 0. 1
f lo Eq i in i / ty t t t u v e s e m e n s p ro s s s e s	0	% 0. 0	( 4 ) 2 6	% -0 4		( ) 6 0 6	% 0. 4 -
E B T	8, 2 2 3	1 1. 3 %	1 8 6 7,	1 0. 1 %	1 4. 4 % +	1 2, 1 5 7	8. 9 %
In t c o m e ax e s	( ) 2, 7 6 8	% 3. 8 -	( ) 2, 7 2 0	% 3. 8 -		( ) 3, 8 1 9	% 2. 8 -
in i i M t o r e s	0		0			0
C O N E T I N M E	5, 4 5 5	% 7. 5	4, 4 6 6	% 6. 3	% 2 2. 1 +	8, 3 3 8	% 6. 1
E P S	0. 4 3 7		0. 3 8 7			0. 2 3 7

EBIT bridge H1 2014 – H1 2015

Cash flow statement

1 0 0 0 € x		H 1 2 0 1 5		H 1 2 0 1 4	F Y 2 0 1 4
C h h b i i f h i t t t a s a e e g n n n g o e p e r	d o	5 3, 6 7		1 5, 1 1	5, 1 1 1
f i N t t e p r o		5 5, 4 5		6 4, 4 6	8, 3 3 8
D i i t e p r e c a o n		9 6, 0 1		9 6, 2 7	1 2, 2 9 2
C h i k i i l t t a n g e n n e o r n g c a p a w
ha in in ie to c ng e ve n r s	( 3, 6 8 ) 7		( 1 0, 1 1 ) 5		( 4, 0 9 ) 7
ha in iv b le c ng e re ce a s	( ) 1, 4 5 8		( ) 2, 6 3 7		( ) 2, 5 4 8
ha in b le c ng e p ay a s	4, 1 8 3		8 5, 5 7		3 6 5
		( ) 9 5 3		( ) 6, 8 9 5	( ) 6, 2 6 2
O h h i i i t t t e r c a n g e s n o p e r a n g e m s		1, 4 6 5		2, 3 4 4	2, 6 0 9
O i h f l t e a g a p r n c s o w		1 2, 0 6 7		6, 1 9 4	1 6, 9 7 7
i N t t t e n v e s m e n s		( ) 7, 9 3 3		( ) 5, 1 3 9	( ) 1 1, 4 9 1
F h f l r e e c a s o w		4, 1 3 4		1, 0 5 5	5, 4 8 6
C h f l f f i i l i i t t a s o w r o m n a n c a a c v y		2, 7 0 3		4 6 9	8, 0 5 4
S l f h a e o o n s a r e s w		0		0	0
D i i d d v e n s		( ) 4, 6 1 3		( ) 4, 6 1 3	( ) 1 6, 1 4 6
F o r e x		( ) 6 1 1		4 7 2	4 5 3
C h f l a s o w		1, 6 1 3		( ) 2, 6 1 7	( ) 2, 1 5 3
C h h d f h i d t t t a s a e e n o e p e r o		8 5, 2 8		4 2, 4 9	2, 9 5 8

Balance sheet

1 0 0 0 € x	3 0- J 1 5 u n -	3 1- D 1 4 e c-	3 0- J 1 4 u n -
F i d t x e a s s e s	9 6 7 2 6 ,	9 6 1 5 2 ,	9 6 6 8 4 ,
S h f l i i t t t o r e r m n a n c a a s s e s	-	-	5
k l N i i t t e o n g c a p a w r	4 0 9 9 5,	4 8 4 4 5,	4 9 0 5, 5
C i l l d E t a p a m p o e y	1 4 1, 8 2 5	1 4 1, 9 9 6	1 4 2 6 3 9 ,
i E t q u y	1 1 0 2 4 9 ,	1 1 0 3 8 7 ,	1 1 8 8 0 1 ,
f i k d R e s e r e s o r r s s a n v
i d i d f d t s e v e r a n c e n e m n y e e r r e ,	4 2 0 7 ,	4 3 2 5 ,	4 0 2 6 ,
N d b t t e e	2 7, 3 0 6	2 6 9 3 3 ,	1 9 8 1 2 ,
S f f i o u r c e s o n a n c e	1 4 1, 8 2 5	1 4 1, 9 9 6	1 4 2 6 3 9 ,

Net financial position

1 0 0 0 € x	J 3 0- 1 5 u n -	D 3 1- 1 4 e c-	J 3 0- 1 4 u n -
C h a s	1 1	9	1 1
P i i b l f i d b k t t t t o s v e a a n c e s o u n r e s r c e a n a c c o u n	5, 0 8 1	2, 6 9 1	2, 0 1 0
O h l d i i i i t t e r q u e s	1 9 6	2 8 5	4 7 3
C h d h i l ( C ) A B t + + a s a n c a s e q u v a e n s	5 2 8 8 ,	2 9 5 8 ,	2 4 9 4 ,
C b k d f t t e a e a u r r n n o v r r s	2 0 5 4 0 ,	1 5, 8 9 0	1 7, 8 8 5
C i f d b t t t t u r r e n p o r o n o n o n -c u r r e n e	3, 2 7 5	3, 2 3 7	1, 0 5 5
O h f i i l b l t t e e a a a a e r c u r r n n n c p y s	1 3	1 0 5	-
C f i i l d b ( G ) E F t t + + e n n a n c a e u r r	2 4 3 0 5 ,	1 9 1 8 7 ,	1 8 9 4 0 ,
C f i i l d b ( ) H D t t t u r r e n n e n a n c a e -	1 9 0 1 7 ,	1 6 6 0 7 ,	1 6 4 4 6 ,
b k b l N t o n -c u r r e n a n p a y a e s	6 4 6 1 ,	8 2 7 5 ,	1, 3 9 8
O h f i i l b l t t e e a a a a e s r n o n -c u r r n n n c p y	1, 8 2 8	1, 8 9 8	1, 9 6 8
N f i i l d b ( J K ) t t + o n -c e n n a n c a e u r r	8 2 8 9 ,	1 0 1 7 3 ,	3 3 6 6 ,
f i i l d b ( ) N L I t t + e n a n c a e	2 3 0 6 7 ,	2 6 9 3 3 ,	1 9 8 1 2 ,

Share buyback plan

• •Last 14 September Sabaf announced the launch of a share buyback programme
• • The buyback concerns up to a maximum of 1,153,345 shares, equal to 10% of the share capital
• • The programme's objectives are as follows:
• – to use treasury shares as part of agreements with strategic partners or in the framework of investment transactions
• –to offer shareholders an additional tool to liquidate their investments
• –to conduct operations to support market liquidity
• • During the period between 14 September and 25 September Sabaf has bought 14,000 shares, equal to 0.12% of the share capital

Forecasts

• • For the full year 2015, we confirm the expectation to achieve sales and profitability levels slightly higher than those of 2014.
• • These targets assume a macroeconomic scenario not affected by unpredictable events. If the economic situation were to change significantly, actual figures might diverge from forecasts.

Stock price and main shareholders

Disclaimer

Certain information included in this document is forward looking and is subject to important risks and uncertainties that could cause actual results to differ materially.

The Company's business is in the domestic appliance industry, with special reference to the gas cooking sector, and its outlook is predominantly based on its interpretation of what it considers to be the key economic factors affecting this business. Forward-looking statements with regard to the Group's business involve ^a number of important factors that are subject to change, including: the many interrelated factors that affect consumer confidence and worldwide demand for durable goods; general economic conditions in the Group's markets; actions of competitors; commodity prices; interest rates and currency exchange rates; political and civil unrest; and other risks and uncertainties.

Pursuant to Article 154/2, paragraph 2 of the Italian Consolidated Finance Act (Testo Unico della Finanza), the company's Financial Reporting Officer Gianluca Beschi declares that the financial disclosure contained in this financial presentation corresponds to the company's records, books and accounting entries.

For further information, please contact Gianluca Beschi - +39.030.6843236gianluca.beschi@sabaf.it