Stabilus SE

Investor Presentation • Jan 31, 2022

Q1 FY2022 RESULTS

JANUARY 31, 2022

¹ MOTION CONTROL

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 UPDATE

FINANCIAL RESULTS

RESULTS BY OPERATING SEGMENT

OUTLOOK

APPENDIX

OPERATIONAL UPDATE

M&A: CULTRARO

EXPANDING PRODUCT RANGE BY SMALL-FORMAT APPLICATIONS

Select products and applications Comments

• › Stabilus entered into partnership with Cultraro Automazione Engineering S.r.l., Rivoli (near Turin), Italy and acquired 32% of total shares in this company.
• › Cultraro (founded in 1997, more than 400 employees, €12.6m revenue in 2020, see www.cultrarogroup.com for further details) is a leading manufacturer of small-format dampers and latches
• › Products: rotary, axial and linear dampers, latches; product applications in a broad range of industries, e.g., electronics and tools, home and appliances, automotive, services and activities, other means of transport
• › First-time consolidation into Stabilus Group according to equity method in December 2021
• › The acquisition of shares was financed with cash.
• › Rationale: expand Stabilus Group's product portfolio by smallformat motion control solutions

STABILUS LONG-TERM STRATEGY

	OVERVIEW OF KEY STRATEGY ELEMENTS		2030
Our Vision			Global leader in intelligent motion control technologies
Our Purpose		We make motion easy and safe – each and every day
Our Mission			We deliver world class motion control solutions
Our Values			CODE-S: Commitment Open Delight Ethical
Our Goals	Profitable and Sustainable Growth	Company of Choice		Next Level Motion Control Solutions	Model Corporate Citizen
Our KPI's	Total Sales €2bn	Employee & Customer Net		€0.5bn Sales with New	Company with Top
	@ 15% adj. EBIT margin	Promoter Score > 50		Innovative Solutions	Sustainability Ratings

FINANCIAL RESULTS

Q1 FY2022 FINANCIAL RESULTS

Revenue	› Revenue at €243.7m (vs. €235.4m in Q1 FY21), + €8.3m or + 3.5% y/y › Acquisition effect: 0% y/y, currency translation effect: 2.3% y/y, organic growth: + 1.2% y/y
Adj. EBIT	› Adj. EBIT at €29.3m (vs. €32.3m in Q1 FY21), - 9.3% y/y › Adj. EBIT margin at 12.0% (vs. 13.7% in Q1 FY21)
Profit	› Profit at €18.0m (vs. €14.3m in Q1 FY21), + 25.9% y/y › Profit margin at 7.4% (vs. 6.1% in Q1 FY21)
Adj. FCF	› Adj. FCF, i.e., FCF before acquisitions, at €7.4m (vs. €21.9m in Q1 FY21), - 66.2% y/y › FCF at €(15.2)m (vs. €21.9m in Q1 FY21), payments for acquisitions in Q1 FY22 at €22.6m (vs. €0m in Q1 FY21)
Net leverage ratio	› Net leverage ratio at 0.7x (vs. 0.6x as of end FY2021 and 1.0x as of end Q1 FY21) › Net financial debt at €124.1m (vs. €107.0m as of end FY2021 and €152.2m as of end Q1 FY21)
Subsequent events	› End of January 2022, Stabilus issued its 2nd promissory note ("Schuldschein") of €55m (5y; 6-month Euribor + 80bp p.a.) › Rationale: balance maturity profile, diversify financing sources, provide flexibility for the optimization of cost of capital
Outlook	› Forecast for FY2022 unchanged: revenue of €940m - €990m with an adjusted EBIT margin of 14% - 15%

KEY FIGURES

Q1 FY2022

RESULTS BY OPERATING SEGMENT

10

Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Europe, Middle East and Africa in Q1 FY22 at 4.4m units, i.e., - 24.0% vs. Q1 FY21
• › EMEA's revenue down by €8.1m or 7.1% y/y to €105.5m in Q1 FY22, organically - 6.3% y/y
• › Stabilus automotive divisions were impacted by lower LVP in Q1 FY22, nonetheless – with organic change in Automotive Gas Spring unit of - 22.4% y/y and in Automotive Powerise of - 16.7% y/y – they performed better than the underlying market
• › Industrial revenue up by 7.9% to €57.6m in Q1 FY22 (vs. 53.4m in Q1 FY21); organic growth at 9.0% y/y: strong growth in all market segments, partially offset by soft business in Health, Recreation & Furniture (HRF)
• › Adj. EBIT margin decreased by 2.7pp to 10.3% in Q1 FY22, as a result of material price inflation and the time lag of sales price negotiations

AMERICAS Q1 FY2022

Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Americas in Q1 FY22 at 4.0m units, i.e., - 13.6% vs. Q1 FY21
• › Americas' revenue down by €7.2m or 8.5% y/y, currency translation effect at 3.1%, organic change at - 11.6% y/y
• › Automotive Gas Spring's revenue changed by 12.0% y/y organically, performing better than the LVP; Automotive Powerise revenue with - 24.9% y/y organic change was impacted by semiconductor shortages at several OEMs and the shift of Powerise production for two Tesla vehicle models manufactured in China from Americas to APAC (low single digit €m negative impact on Americas' Powerise revenue)
• › Americas' Industrial revenue up by €2.9m or 12.1% y/y to €26.8m in Q1 FY22, organic growth at 8.2% y/y: strong growth in all market segments, with rather moderate developments in Health, Recreation & Furniture (HRF)
• › Adj. EBIT margin decreased by 6.1pp to 7.1% in Q1 FY22, due to material price and labor cost inflation, as well as the time lag of sales price negotiations

Revenue (€m) Comments

Adj. EBIT (€m)

• › Light vehicle production (LVP) in Asia-Pacific in Q1 FY22 at 12.1m units, i.e., - 8.4% vs. Q1 FY21
• › APAC's revenue up by €23.7m or 63.4% to €61.1m in in Q1 FY22, currency translation effect at 10.0%, organic growth at 53.4% y/y
• › Organic growth in Automotive Gas Spring division at 14.0% y/y and in Automotive Powerise at 141.8% y/y; Powerise growth driven by higher production for, e.g., CHJ Leading Ideal One (EV, full-sized SUV), Geely Zeekr 001 (EV), GAC Trumpchi GS4, GS 5, GS6 and GM6, Human Horizons HiPhi (EV), Hyundai Ioniq 5 (EV, CUV), Kia K7, Tesla Model 3 (EV) and Model Y (EV),Toyota Highlander, VW ID. Roomzz (EV, SUV); in addition, Powerise production for Tesla Models 3 and Y which are manufactured in China was shifted from Americas to APAC (low single digit €m positive impact on APAC's Powerise revenue)
• › Organic growth of APAC's Industrial revenue at 42.1% y/y strong growth in all market segments
• › Adj. EBIT margin improved by 3.7pp to 21.1% in Q1 FY22, corresponding to higher sales, better production capacity utilization, and thus, fixed-cost absorption

REVENUE BY BUSINESS UNIT

Q1 FY2022

Q1 FY2022

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

Energy, Construction, Industrial Machinery & Automation (ECIMA)

• › Industrial revenue at €90.5m, up by 11.2% or €9.1m y/y
• › The growth in industrial business by round €9m y/y was primarily driven by market segment Distributors, Independent Aftermarket, E-commerce (DIAMEC)
• › The breakdown of c. €9m additional revenue is as follows:

›	DIAMEC:	+ c. €8m	(+ 29% y/y)
›	Mobility:	+ c. €2m	(+ 9% y/y)
›	HRF:	- c. €3m	(- 18% y/y)
›	ECIMA:	+ c. €2m	(+ 19% y/y)

› As a result, the revenue share of DIAMEC and ECIMA segments increased to 39% (PY: 34%) and 17% (PY:16%) of total industrial revenue and of HRF decreased to 16% (PY: 22%), respectively; the revenue share of Mobility segment remained at 28% (PY: 28%)

OUTLOOK

Guidance			Comments
	FY2021 Actual	FY2022 Guidance
Revenue	€937.7m	€940m - €990m
Adj. EBIT margin	14.4%	14% - 15%

› The FY2022 forecast is based on the assumption of an fx rate of 1.25 US\$/€ and y-o-y flat LVP development in FY2022. Meanwhile, as of January 2022, IHS Markit expects global light vehicle production (LVP) to grow by c. 2.7% y/y in the Stabilus fiscal year 2022 (i.e., Oct 2021-Sept 2022): LVP of c. 81.7m in FY22 vs. c. 79.5m in FY21.

› Stabilus confirms the FY2022 forecast which was published in November 2021. Price negotiations with customers are welladvanced. Due to not yet resolved semiconductor supply issues at several OEMs and higher inflation of material and labor costs, the uncertainty remains high.

› 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 2020-2025 of 6% and an adj. EBIT margin of 15%.

APPENDIX

REVENUE AND ADJUSTED EBIT MARGIN BY QUARTER

REVENUE OVERVIEW THREE MONTHS ENDED DECEMBER 31, 2021

Revenue (€m)

	Q1 FY2021 Actual	Q1 FY2022 Actual	Change	% change	Acquisition effect	Currency effect	Organic growth
Automotive Gas Spring	33.5	26.0	(7.5)	(22.4)%	-	0.0%	(22.4)%
Automotive Powerise	26.7	21.9	(4.8)	(18.0)%	-	(1.3)%	(16.7)%
Industrial	53.4	57.6	4.2	7.9%	-	(1.1)%	9.0%
EMEA	113.6	105.5	(8.1)	(7.1)%	-	(0.8)%	(6.3)%
Automotive Gas Spring	25.2	23.0	(2.2)	(8.7)%	-	3.3%	(12.0)%
Automotive Powerise	35.3	27.4	(7.9)	(22.4)%	-	2.5%	(24.9)%
Industrial	23.9	26.8	2.9	12.1%	-	3.9%	8.2%
AMERICAS	84.4	77.2	(7.2)	(8.5)%	-	3.1%	(11.6)%
Automotive Gas Spring	22.7	27.5	4.8	21.1%	-	7.1%	14.0%
Automotive Powerise	10.6	27.4	16.8	158.5%	-	16.7%	141.8%
Industrial	4.1	6.2	2.1	51.2%	-	9.1%	42.1%
APAC	37.4	61.1	23.7	63.4%	-	10.0%	53.4%
Total Automotive Gas Spring (AGS)	81.4	76.5	(4.9)	(6.0)%	-	3.0%	(9.0)%
Total Automotive Powerise (APR)	72.6	76.7	4.1	5.6%	-	3.2%	2.4%
Total Industrial (IND)	81.4	90.5	9.1	11.2%	-	0.9%	10.3%
Total	235.4	243.7	8.3	3.5%	-	2.3%	1.2%

P&L OVERVIEW

THREE MONTHS ENDED DECEMBER 31, 2021

P&L (€m)

	Q1 FY2021 Actual	Q1 FY2022 Actual	Change	% change
Revenue	235.4	243.7	8.3	3.5%
Cost of sales	(165.4)	(178.1)	(12.7)	7.7%
Gross Profit	70.1	65.7	(4.4)	(6.3)%
% margin	29.8%	27.0%
R&D expenses	(10.5)	(11.9)	(1.4)	13.3%
Selling expenses	(20.5)	(20.2)	0.3	(1.5)%
Administrative expenses	(10.0)	(9.9)	0.1	(1.0)%
Other income/expenses	(1.0)	2.3	3.3	<(100.0)%
EBIT	28.1	25.9	(2.2)	(7.8)%
% margin	11.9%	10.6%
Finance income/costs	(8.1)	(0.8)	7.3	(90.1)%
EBT	20.0	25.2	5.2	26.0%
% margin	8.5%	10.3%
Income tax	(5.7)	(7.2)	(1.5)	26.3%
Profit	14.3	18.0	3.7	25.9%
% margin	6.1%	7.4%
EPS in €	0.58	0.71	0.13	22.4%

Comments

› Gross profit margin down to 27.0% in Q1 FY22 (vs. 29.8% in Q1 FY21), as a consequence of material price inflation and the time lag of offsetting measures

› Net finance costs down by €7.3m mainly due to €1.3m net fx gain in Q1 FY22 (vs. €5.7m net fx loss in Q1 FY21) and €0.3m lower interest expense on financial liabilities (as a consequence of senior-loan redemption in the previous fiscal year)

EBIT ADJUSTMENTS THREE MONTHS ENDED DECEMBER 31, 2021

Adjusted EBIT (€m)

	Q1 FY2021 Actual	Q1 FY2022 Actual	Change	% change
EBIT	28.1	25.9	(2.2)	(7.8)%
PPA adj. - D&A (2010 PPA)	1.7	1.2	(0.5)	(29.4)%
PPA adj. - D&A (2016 PPA)	2.0	2.1	0.1	5.0%
PPA adj. - D&A (2019 PPA)	0.4	0.2	(0.2)	(50.0)%
Total adjustments	4.2	3.4	(0.8)	(19.0)%
Adjusted EBIT	32.3	29.3	(3.0)	(9.3)%
% margin	13.7%	12.0%

Comments

• › PPA adjustments comprise depreciation and amortization of step-ups and intangible assets acquired during 2010, 2016 and 2019 acquisitions
• › The decrease of the depreciation & amortization related to 2010 PPA and of the corresponding EBIT adjustment is the consequence of scheduled amortization of acquired intangible assets

BALANCE SHEET OVERVIEW

DECEMBER 31, 2021

Balance sheet (€m)

	Sept 2021 Actual	Dec 2021 Actual	Change	% change
Property, plant and equipm.	223.1	224.4	1.3	0.6%
Goodwill	208.1	208.2	0.1	0.0%
Other intangible assets	222.6	219.5	(3.1)	(1.4)%
Other investments	-	22.6	22.6	n/a
Inventories	136.9	145.1	8.2	6.0%
Trade receivables	136.7	138.6	1.9	1.4%
Other assets	46.0	53.4	7.4	16.1%
Cash	193.2	175.9	(17.3)	(9.0)%
Total assets	1,166.6	1,187.7	21.1	1.8%
Equity incl. minorities	544.3	567.0	22.7	4.2%
Debt (incl. accrued interest)	294.8	295.5	0.7	0.2%
Pension plans	54.7	56.2	1.5	2.7%
Deferred tax liabilities	47.7	47.3	(0.4)	(0.8)%
Trade payables	90.4	89.5	(0.9)	(1.0)%
Other liabilities	134.7	132.2	(2.5)	(1.9)%
Total equity and liabilities	1,166.6	1,187.7	21.1	1.8%
Net leverage ratio	0.6x	0.7x

Comments

• › Property, plant and equipment up by €1.3m due to higher amount of construction in progress (machinery/equipment) partially offset by scheduled depreciation of PPE in use; other intangible assets down by €3.1m mainly due to scheduled amortization, partially offset by capitalized R&D costs
• › Other investments comprise Company's interest in Synapticon (12% of total shares at the time of acquisition) and Cultraro (32% of total shares) which were acquired in Q1 FY22
• › Inventories up by €8.2m primarily due to higher stock of raw materials and supplies (+ €4.4m y/y) and merchandise (+ €3.7m y/y) – larger buffers as mitigation of supply chain risks and shortnotice customer call-off changes
• › Other assets up by €7.4m mainly due to higher deferred charges and current tax assets

CASH FLOW OVERVIEW THREE MONTHS ENDED DECEMBER 31, 2021

Cash Flow Statement (€m)

	Q1 FY2021 Actual	Q1 FY2022 Actual	Change	% change
Cash flow from operating activities	31.4	16.7	(14.7)	(46.8)%
Cash flow from investing activities	(9.5)	(31.9)	(22.4)	>100.0%
Cash flow from financing activities	(17.1)	(3.4)	13.7	(80.1)%
Net increase / (decrease) in cash	4.8	(18.5)	(23.3)	<(100.0)%
Effect of movements in exchange rates	0.1	1.2	1.1	>100.0%
Cash as of beginning of the period	162.4	193.2	30.8	19.0%
Cash as of end of the period	167.4	175.9	8.5	5.1%

Adj. FCF (€m)

	Q1 FY2021 Actual	Q1 FY2022 Actual	Change	% change
Cash flow from operating activities	31.4	16.7	(14.7)	(46.8)%
Cash flow from investing activities	(9.5)	(31.9)	(22.4)	>100.0%
Free cash flow	21.9	(15.2)	(37.1)	<(100.0)%
Adjustments	-	22.6	22.6	n/a
Adj. FCF	21.9	7.4	(14.5)	(66.2)%

Comments

• › Capex in Q1 FY22 at €9.4m (vs. €9.7m in Q1 FY21), 3.1% y/y
• › Cash inflow from operating activities down by €14.7m essentially due to the negative effect from higher net working capital and higher income tax payment
• › Cash outflow for financing activities up by €22.4m essentially due to the €22.6m payment for the acquisition of shares in Synapticon and Cultraro (PY: €0m)
• › As a result of lower cash inflow from operating activities, the adj. FCF (i.e., FCF before acquisitions) amounted to €7.4m in Q1 FY22 vs. €21.9m in Q1 FY21

CURRENCY EXCHANGE RATES

THREE MONTHS ENDED DECEMBER 31, 2021

Closing and average currency exchange rates

1 EURO in	ISO code	Closing rate December 2020	Closing rate December 2021	Average rate Q1 FY2021	Average rate Q1 FY2022	Average rate % change
Australian dollar	AUD	1.5896	1.5615	1.6318	1.5689	(3.9)%
Argentine peso	ARS	103.5100	116.4913	95.3566	114.8426	20.4%
Brazilian real	BRL	6.3735	6.3101	6.4384	6.3826	(0.9)%
Chinese yuan (renminbi)	CNY	8.0225	7.1947	7.8993	7.3140	(7.4)%
South Korean won	KRW	1,336.0000	1,346.3800	1,333.0767	1,353.8179	1.6%
Mexican peso	MXN	24.4160	23.1438	24.5027	23.7193	(3.2)%
Romanian leu	RON	4.8683	4.9490	4.8718	4.9489	1.6%
Turkish lira	TRY	9.1131	15.2335	9.4013	12.7738	35.9%
United States dollar	USD	1.2271	1.1326	1.1928	1.1440	(4.1)%

MOTION CONTROL