Stabilus SE — Investor Presentation 2021

Feb 1, 2021

Q1 FY2021 RESULTS FEBRUARY 1, 2021

M O T I O N C O N T R O L

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Stabilus S.A. (the "Company", later "Stabilus") has prepared this presentation solely for your information. It should not be treated as giving investment advice. Neither the Company, nor any of its directors, officers, employees, direct or indirect shareholders and advisors nor any other person shall have any liability whatsoever for any direct or indirect losses arising from any use of this presentation.

While the Company has taken all reasonable care to ensure that the facts stated in this presentation are accurate and that the opinions contained in it are fair and reasonable, this presentation is selective in nature. Any opinions expressed in this presentation are subject to change without notice and neither the Company nor any other person is under any obligation to update or keep current the information contained in this presentation. Where this presentation quotes any information or statistics from any external source, you should not interpret that the Company has adopted or endorsed such information or statistics as being accurate. This presentation contains forward-looking statements, which involve risks, uncertainties and assumptions that could cause actual results, performance or events to differ materially from those described in, or expressed or implied by, such statements. These statements reflect the Company's current knowledge and its expectations and projections about future events and may be identified by the context of such statements or words such as "anticipate," "believe", "estimate", "expect", "intend", "plan", "project" and "target". No obligation is assumed to update any such statement.

Numbers were rounded to one decimal. Due to rounding, numbers presented may not add up precisely to the totals provided.

AGENDA

OPERATIONAL HIGHLIGHTS

FINANCIAL RESULTS

RESULTS BY OPERATING SEGMENT

OUTLOOK

APPENDIX

Shanghai) is largely completed, first Powerise production line installed, ready for the ramp up phase (see following pages)

OVERVIEW

	Status quo		Corporate actions
›	Strict safety procedures are in place (pandemic plan); situation is under control; only sporadic new COVID-19 cases at Stabilus production plants in Mexico, Romania, US and Germany	›	Top priorities: ensuring safety of our employees and business continuity (keeping the production running)
›	Global light vehicle production (LVP) in Q1 FY21 at 23.4m vehicles, + 2.5% y/y (vs. -2.7% y/y according to IHS forecast from Oct 16, 2020); customer demand from our automotive customers recovering further, industrial business continues to be soft	›	Stabilus pandemic rules (incl. social distancing, disinfection et al.) continue to be effective and operational; close monitoring of all activities continues, in order to reduce COVID-19 risks for Stabilus employees and operations
›	In the Automotive Powerise division, several new model launches led to substantial outperformance of LVP in Q1 FY21	›	Cost flexibilization (EBIT recovery) program
›	Limited visibility for Q2 FY21 due to semiconductor shortages at OEMs	›	Aligning/adjusting our production capacity to customer demand by utilizing short-time work schemes, furloughs, plant shut downs for several days, selected layoffs et al.
›	Flexible production set-up continues to be very important in the current market environment
›	The construction of the new Powerise plant in Pinghu (near

NEW POWERISE PLANT IN PINGHU, CHINA

NEW POWERISE PLANT IN PINGHU, CHINA

NEW POWERISE PLANT IN PINGHU, CHINA

FINANCIAL RESULTS

Revenue	› Revenue at €235.4m (vs. €231.4m in Q1 FY20), + €4.0m or + 1.7% y/y › Acquisition effect: 0% y/y, currency translation effect: - 5.4% y/y, organic growth: + 7.1% y/y
Adj. EBIT	› Adj. EBIT at €32.3m (vs. €30.0m in Q1 FY20), + 7.7% y/y › Adj. EBIT margin at 13.7% (vs. 13.0% in Q1 FY20 and 13.7% in Q1 FY19)
Profit	› Profit at €14.3m (vs. €16.4m in Q1 FY20), - 12.8% y/y
Adj. FCF	› Adj. FCF (i.e. FCF before acquisitions) = FCF: there were no payments for acquisitions in Q1 FY21 › Adj. FCF at €21.9m (vs. €7.8m in Q1 FY20)
Net leverage ratio	› Net leverage ratio at 1.0x (vs. 1.2x as of end FY2020) › Net financial debt at €152.2m (vs. €172.3m as of end FY2020 and €184.3m as of end Q1 FY20)
Outlook	› Revenue forecast for FY2021: €850m - €900m › Adj. EBIT margin forecast for FY2021: 12% - 13%

KEY FIGURES

Q1 FY2021

RESULTS BY OPERATING SEGMENT

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Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Europe, Middle East and Africa in Q1 FY21 at 5.7m units, i.e. + 0.2% vs. Q1 FY20
• › EMEA's revenue up by €3.4m or 3.1% y/y to €113.6m in Q1 FY21, organic growth at 4.4% y/y
• › Organic growth in Automotive Gas Spring division 3.7% y/y and in Automotive Powerise 15.2% y/y; Powerise growth due to higher product adoption/installation rates in and increased production of BMW 5-series, Porsche Macan, Porsche Taycan, VW Cupra Formentor, Skoda Octavia, VW T-Roc, VW Passat, Audi A3, Audi e-tron
• › Industrial revenue slightly below prior year's Q1 level and flat organically: revenue growth in the market subsegments commercial vehicles, healthcare, recreation & furniture was offset by weaker business in energy, construction, industrial machinery & automation, as well as in aerospace, marine & rail
• › Adj. EBIT margin improved by 70bp to 13.0%, reflecting sustainability ("stickiness") of cost saving actions

AMERICAS Q1 FY2021

Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Americas in Q1 FY21 at 4.6m units, i.e. + 0.4% vs. Q1 FY20
• › Americas revenue down by €6.0m or 6.6% y/y, due to COVID-19 crisis and negative currency translation effect of -11.7%; organically Americas revenue grew by 5.1% y/y
• › Organic growth in Automotive Gas Spring division at 9.2% y/y and in Automotive Powerise at 22.4%; Powerise growth due to product installation rates in and increased production of Tesla Model 3, Tesla Model Y, Ford Edge, VW Audi Q5
• › Industrial revenue dipped by €7.5m to €23.9m in Q1 FY21, 23.9% y/y or -16.7% y/y organically; revenue growth in distributors, independent aftermarket, e-commerce (DIAMEC) and commercial vehicles market segments was not sufficient to offset revenue decline in our other industrial markets; in particular, our business with energy & construction customers was substantially weaker than in Q1 of the previous fiscal year
• › As a result of softer industrial business (negative mix effect), adj. EBIT margin 70bp below the Q1 FY20 level of 13.9%

Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Asia-Pacific in Q1 FY21 at 13.1m units, i.e. + 4.3% vs. Q1 FY20
• › APAC's revenue grew by €6.6m or +21.4% to €37.4m in Q1 FY21, organically + 23.2% y/y
• › Organic growth in Automotive Gas Spring division at 16.4% y/y and in Automotive Powerise at 58.0% y/y; Powerise growth as a result of new model launches and increased production of CHJ Leading Ideal One (EV, full-sized SUV), Geely Lynk & Co 05 (coupe-like crossover), SAIC Roewe RX5 (compact crossover), SAIC D-MPV, Ford Explorer, GM Cadillac XT6 (mid-sized crossover)
• › Industrial revenue €0.1m below prior year's Q1 level, organically - 1.1% y/y; revenue growth in distributors, independent aftermarket, e-commerce (DIAMEC), mobility and energy & construction markets was offset by revenue decline in healthcare, recreation & furniture as well as in industrial machinery & automation subsegments
• › As a consequence of better capacity utilization, adj. EBIT margin improved by 4.4pp to 17.4% in Q1 FY21, well above group average

REVENUE BY BUSINESS UNIT

Q1 FY2021

Q1 FY2021

Distributors, Independent Aftermarket, E-commerce (DIAMEC) Mobility (M) Healthcare, Recreation & Furniture (HRF)

Energy, Construction, Industrial Machinery & Automation (ECIMA)

• › Industrial revenue at €81.4m, down by 9.5% or €8.5m y/y
• › Driven by the current COVID-19 crisis, a significantly lower business activity could be observed in the energy, construction, industrial machinery and automation markets in Q1 FY21
• › ECIMA's revenue dip by €10m (- 44% y/y) was only partly offset by €1m revenue growth in DIAMEC (+ 3% y/y) and €1m revenue growth in HRF (+5% y/y); with €23m the Mobility segment was on the level of the prior year's Q1
• › As a result, the share of DIAMEC, Mobility and HRF revenue has increased from 30%, 26% and 19% of the industrial revenue in Q1 of the previous fiscal year to 34%, 28% and 22% of the industrial revenue in Q1 FY21, respectively; the ECIMA's revenue contribution dipped from 25% to 16% of industrial revenue
• › Within the Mobility segment we achieved higher revenues in commercial vehicles subsegment which were largely offset by lower revenues in aerospace, marine & rail subsegment

OUTLOOK

Guidance				Comments
	FY2020 Actual	FY2021 Guidance	›	Global light vehicle production (LVP) in FY2021 (Oct-Sept) is expected to grow by c. 16% y/y (i.e. c. 85.7m in FY21 vs. c. 73.9m
Revenue	€822.1m	€850m - €900m		in FY20). The return to the annual production level of c. 90m is expected for FY2023. (Source: leading forecast institutes, IHS Markit Jan 2021 et al.)
			›	Limited visibility for Q2 FY21 due to semiconductor shortages at OEMs
Adj. EBIT margin	11.8%	12% - 13%	›	The COVID-19 pandemic has affected all our customer markets and target industries. As a consequence of the pandemic and the
				significant uncertainty, the guidance shows a wider range compared to the prior years. We will review our FY2021 forecast on a regular basis and specify it further as soon as possible.
			›	We continue to pursue our long-term strategy focusing on sustainable, profitable growth, globalization, excellence, innovation as well as team spirit (One Stabilus). Based on the current LVP and GDP assumptions, we strive for organic revenue CAGR 2020-25 of 6% and the return to an adj. EBIT margin of 15%.

APPENDIX

REVENUE AND ADJUSTED EBIT MARGIN BY QUARTER

REVENUE OVERVIEW THREE MONTHS ENDED DECEMBER 31, 2020

Revenue (€m)

	Q1 FY2020 Actual	Q1 FY2021 Actual	Change	% change	Acquisition effect	Currency effect	Organic growth
Automotive Gas Spring	32.3	33.5	1.2	3.7%	-	0.0%	3.7%
Automotive Powerise	23.7	26.7	3.0	12.7%	-	(2.5)%	15.2%
Industrial	54.2	53.4	(0.8)	(1.5)%	-	(1.5)%	0.0%
EMEA	110.2	113.6	3.4	3.1%	-	(1.3)%	4.4%
Automotive Gas Spring	25.9	25.2	(0.7)	(2.7)%	-	(11.9)%	9.2%
Automotive Powerise	33.1	35.3	2.2	6.6%	-	(15.8)%	22.4%
Industrial	31.4	23.9	(7.5)	(23.9)%	-	(7.2)%	(16.7)%
AMERICAS	90.4	84.4	(6.0)	(6.6)%	-	(11.7)%	5.1%
Automotive Gas Spring	19.8	22.7	2.9	14.6%	-	(1.8)%	16.4%
Automotive Powerise	6.8	10.6	3.8	55.9%	-	(2.1)%	58.0%
Industrial	4.2	4.1	(0.1)	(2.4)%	-	(1.3)%	(1.1)%
APAC	30.8	37.4	6.6	21.4%	-	(1.8)%	23.2%
Total Automotive Gas Spring (AGS)	77.9	81.4	3.5	4.5%	-	(4.4)%	8.9%
Total Automotive Powerise (APR)	63.6	72.6	9.0	14.2%	-	(9.4)%	23.6%
Total Industrial (IND)	89.9	81.4	(8.5)	(9.5)%	-	(3.5)%	(6.0)%
Total	231.4	235.4	4.0	1.7%	-	(5.4)%	7.1%

P&L OVERVIEW

THREE MONTHS ENDED DECEMBER 31, 2020

P&L (€m)

	Q1 FY2020 Actual	Q1 FY2021 Actual	Change	% change
Revenue	231.4	235.4	4.0	1.7%
Cost of sales	(164.6)	(165.4)	(0.8)	0.5%
Gross Profit	66.8	70.1	3.3	4.9%
% margin	28.9%	29.8%
R&D expenses	(10.5)	(10.5)	-	0.0%
Selling expenses	(22.0)	(20.5)	1.5	(6.8)%
Administrative expenses	(8.5)	(10.0)	(1.5)	17.6%
Other income/expenses	(0.3)	(1.0)	(0.7)	>100.0%
EBIT	25.4	28.1	2.7	10.6%
% margin	11.0%	11.9%
Finance income/costs	(3.0)	(8.1)	(5.1)	>100.0%
EBT	22.4	20.0	(2.4)	(10.7)%
% margin	9.7%	8.5%
Income tax	(6.1)	(5.7)	0.4	(6.6)%
Profit	16.4	14.3	(2.1)	(12.8)%
% margin	7.1%	6.1%
EPS in €	0.66	0.58	(0.10)	(12.1)%

Comments

› Gross profit margin improved by 90bp

• › Selling expenses down by €1.5m mainly a result of efficiency gains following integration of industrial business units into one division
• › Administrative expenses up by €1.5m, primarily due to higher IT expenses for further digitalization of our business
• › Other net expenses up by €0.7m due to foreign currency translation losses
• › Finance costs up by €5.1m due to foreign exchange losses from currency translation of intragroup loans (particularly in USD and MXP)

EBIT ADJUSTMENTS THREE MONTHS ENDED DECEMBER 31, 2020

Adjusted EBIT (€m)

	Q1 FY2020 Actual	Q1 FY2021 Actual	Change	% change
EBIT	25.4	28.1	2.7	10.6%
PPA adj. - D&A (2010 PPA)	1.7	1.7	-	0.0%
PPA adj. - D&A (2016 PPA)	2.1	2.0	(0.1)	(4.8)%
PPA adj. - D&A (2019 PPA)	0.8	0.4	(0.4)	(50.0)%
Total adjustments	4.6	4.2	(0.4)	(8.7)%
Adjusted EBIT	30.0	32.3	2.3	7.7%

Comments

• › PPA adjustments comprise depreciation and amortization of step-ups and intangible assets acquired during 2010, 2016 and 2019 acquisitions
• › PPA adjustment for D&A of 2019 PPA down by €0.4m as a consequence of €25.7m impairment of intangible assets in the previous fiscal year, in particular customer relationships of the previously acquired aerospace business

BALANCE SHEET OVERVIEW

DECEMBER 31, 2020

Balance sheet (€m)
Sept 2020 Actual	Dec 2020 Actual	Change	% change
229.8	227.9	(1.9)	(0.8)%
207.7	205.0	(2.7)	(1.3)%
229.3	223.7	(5.6)	(2.4)%
97.2	104.5	7.3	7.5%
117.1	114.1	(3.0)	(2.6)%
40.1	45.6	5.5	13.7%
162.4	167.4	5.0	3.1%
1,083.6	1,088.2	4.6	0.4%
469.6	483.9	14.3	3.0%
322.4	308.5	(13.9)	(4.3)%
57.0	58.4	1.4	2.5%
43.7	42.5	(1.2)	(2.7)%
71.1	70.8	(0.3)	(0.4)%
119.9	124.1	4.2	3.5%
1,083.6	1,088.2	4.6	0.4%
1.0x	1.0x

Comments

• › Other intangible assets down by €5.6m due to scheduled amortization
• › Inventories up by €7.3m primarily due to higher stock of raw materials and supplies (larger buffer during the current COVID-19 crisis)
• › Debt down by €13.9m due to repayment of the revolving credit facility

CASH FLOW OVERVIEW THREE MONTHS ENDED DECEMBER 31, 2020

Cash Flow Statement (€m)

	Q1 FY2020 Actual	Q1 FY2021 Actual	Change	% change
Cash flow from operating activities	19.8	31.4	11.6	58.6%
Cash flow from investing activities	(12.0)	(9.5)	2.5	(20.8)%
Cash flow from financing activities	(3.6)	(17.1)	(13.5)	>100.0%
Net increase / (decrease) in cash	4.2	4.8	0.6	14.3%
Effect of movements in exchange rates	(1.0)	0.1	1.1	<(100.0)%
Cash as of beginning of the period	139.0	162.4	23.4	16.8%
Cash as of end of the period	142.3	167.4	25.1	17.6%

Adj. FCF (€m)

	Q1 FY2020 Actual	Q1 FY2021 Actual	Change	% change
Cash flow from operating activities	19.8	31.4	11.6	58.6%
Cash flow from investing activities	(12.0)	(9.5)	2.5	(20.8)%
Free cash flow	7.8	21.9	14.1	>100.0%
Adjustments	-	-	-	n/a
Adj. FCF	7.8	21.9	14.1	>100.0%

Comments

› Capex in Q1 FY21 at €9.7m (vs. €12.3m in Q1 FY20), - 21.1% y/y

• › Cash inflow from operating activities up by €11.6m mainly due to better net working capital development in Q1 FY21: in Q1 of the previous fiscal year, decrease of trade receivables (= negative impact on operating cash flow) amounted to €15.1m, in Q1 FY21 to €0.3m
• › Cash outflow for financing activities up by €13.5m primarily due to redemption of financial liabilities, i.e. repayment of revolving credit facility
• › As a result of higher cash inflow from operating activities and lower cash outflow for investing activities (i.e. lower capex), the FCF increased substantially from €7.8m in Q1 FY20 to €21.9m in Q1 FY21; as there were no payments for acquisitions, adj. FCF (i.e. FCF before acquisitions) equals the FCF in first quarter of FY20 and FY21

CURRENCY EXCHANGE RATES

THREE MONTHS ENDED DECEMBER 31, 2020

Closing and average currency exchange rates

1 EURO in	ISO code	Closing rate December 2019	Closing rate December 2020	Average rate Q1 FY2020	Average rate Q1 FY2021	Average rate % change
Australian dollar	AUD	1.5995	1.5896	1.6202	1.6318	0.7%
Argentine peso	ARS	67.2692	103.5100	65.6620	95.3566	45.2%
Brazilian real	BRL	4.5157	6.3735	4.5604	6.4384	41.2%
Chinese yuan (renminbi)	CNY	7.8205	8.0225	7.7998	7.8993	1.3%
South Korean won	KRW	1,296.2800	1,336.0000	1,302.0115	1,333.0767	2.4%
Mexican peso	MXN	21.2202	24.4160	21.3242	24.5027	14.9%
Romanian leu	RON	4.7830	4.8683	4.7672	4.8718	2.2%
Turkish lira	TRY	6.6843	9.1131	6.4155	9.4013	46.5%
United States dollar	USD	1.1234	1.2271	1.1072	1.1928	7.7%

M O T I O N C O N T R O L

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