STRATEC SE — Investor Presentation 2020

Aug 13, 2020

H1 2020 FINANCIAL RESULTS

Conference Call – August 13, 2020

Forward-looking statements involve risks.

This company presentation contains various statements concerning the future performance of STRATEC. These statements are based on both assumptions and estimates. Although we are convinced that these forward-looking statements are realistic, we can provide no guarantee of this. This is because our assumptions involve risks and uncertainties which could result in a substantial divergence between actual results and those expected.

It is not planned to update these forward-looking statements.

1. H1 2020 AT A GLANCE

• 1. FINANCIAL REVIEW
• 1. OUTLOOK
• 1. Q&A
• 1. APPENDIX

• • Sales up 9.9% yoy to € 119.4 million; +8.8% at constant currency (H1 2019: € 108.6 million)

• Sales with systems up by 30.6% yoy (+29.3% at constant currency)
• •Adjusted EBIT margin up by 360 bps yoy to 15.4% (H1 2019: 12.8%)
• • Early implementation of measures to counter act supply chain risks and secure health of our employees in light of COVID-19 pandemic
• •Achievement of important development milestones
• •Several promising late stage negotiations regarding new development projects with partners
• • Number of employees up by 9.4% to 1,335 organic increase of 14.5%

1. H1 2020 AT A GLANCE

2. FINANCIAL REVIEW

• 1. OUTLOOK
• 1. Q&A
• 1. APPENDIX

FINANCIALS AT A GLANCE

€ 0 0 0s	H 1 / 2 0 2 0	2 H 1 / 2 0 1 9	C ha ng e	Q 2 / 2 0 2 0	2 Q 2 / 2 0 2 0	C ha ng e
Sa les	1 1 9, 3 6 7	1 0 8, 6 0 4	9. 9 % +	6 2, 8 6 3	6 2, 0 3 5	1. 3 % +
A d d E B I T D A j te us	2 3, 3 5 7	3 2 1 7, 5	3 9 % 5. +	3, 3 9 1 5	0, 4 8 1 1	3 2. 0 % +
A d d E B I T D A ( % ) j in te us m ar g	1 9. 7	1 6. 0	3 7 0 bp + s	2 1. 3	1 6. 4	4 9 0 bp + s
A d d E B I T j te us	1 8, 4 1 3	1 2, 8 0 5	4 3. 8 % +	1 0, 7 5 5	7, 8 3 0	3 7. 4 % +
( % ) A d d E B I T j in te us m ar g	1 5. 4	1 1. 8	3 6 0 bp + s	1 7. 1	1 2. 6	4 5 0 bp + s
3 A d d l da d j i inc te te t us co ns ne om e o	1 5, 5 9 5	1 0, 4 5 5	4 9. 2 % +	9, 3 4 9	6, 6 9 9	3 9. 6 % +
3 A d d ba ha ( € ) j ic ing in te us s ea rn s p er s re	1. 3 0	0. 8 7	4 9. 4 % +	0. 7 8	0. 5 6	3 9. 3 % +
3 Ba ha I F R S ( € ) ic ing in s ea rn s p er s re	1. 0 1	0. 4 8	1 1 0. 4 %	0. 6 4	0. 3 7	7 3. 0 % +

bps = basis points

To facilitate comparison, adjusted figures exclude amortization resulting from purchase price allocations in the context of acquisitions and associated reorganization expenses

2Retrospectively restated to account for the recognition of the Data Solutions business unit as a discontinued operation pursuant to IFRS 5.

Consolidated net income from continuing operations.

SALES

Sales in € million

As of June 30

H1/2020 sales up 9.9% yoy to € 119.4 million

• • Strong growth with systems as well as service parts and consumables
• • Huge extra demand for molecular diagnostic systems as a result of COVID-19 pandemic
• • Significantly lower amount of recognized development revenues due to strong prior year comparison basis

8.8% in constant currency

SALES BY OPERATING DIVISIONS

In % of total sales

CER = Constant exchange rates

As of June 30

H1 2020 FINANCIAL RESULTS – AUGUST 13, 2020 ⁸

ADJUSTED EBIT AND EBIT MARGIN

H1/2020 EBIT up 43.8% yoy to € 18.4 million

H1/2020 adjusted EBIT margin at 15.4%

Margin expansion of 360 bps yoy

(+) Economies of scale

(+) Positive sales and product mix

(-) Stock appreciation rights (negative margin effect of 200 bps)

As of June 30

SEGMENT PERFORMANCE

Instrumentation

€ 0 0 0s	H 1 / 2 0 2 0	H 1 / 2 0 1 9	C ha ng e	A C E R t
Sa les	8 4, 5 5 1	8 1, 9 8 5	3. 1 % +	1. 9 % +
A d E B I T j.	1 2, 4 6 8	1 1, 5 5 0	7. 9 % +
A d E B I T j. in ma rg	1 4. 7 %	1 4. 1 %	6 0 bp + s

Significantly lower recognition of development & services sales

Adverse margin effect from stock appreciation rights

€ 0 0 0s	H 1 / 2 0 2 0	H 1 / 2 0 1 9	C ha ng e	A C E R t
Sa les	2 8, 1 0 1	2 0, 6 7 3	3 5. 9 % +	3 5. 3 % +
A d E B I T j.	7, 5 1 5	3, 3 4 5	1 2 4. 7 % +
A d E B I T j. in ma rg	2 6. 7 %	1 6. 2 %	1. 0 5 0 bp + s

Diatron

Strong growth with molecular and veterinary diagnostics products

Scale effects and strong product mix

Smart Consumables

€ 0 0 0s	/ 2 0 2 0 H 1	/ 2 0 9 H 1 1	C ha ng e	C A E R t
Sa les	6, 7 1 5	5, 9 4 6	1 2. 9 % +	1 2. 0 % +
A d d E B I T j te us	-1 5 7 0 ,	-2 0 9 1 ,	nm
A d E B I T j. in ma rg	-2 3. 4 %	-3 5. 2 %	1. 1 8 0 bp + s

Backend loaded year expected

CER = Constant exchange rates

CASH FLOW AND NET DEBT

€ 0 0 0s	H 1 / 2 0 2 0	H 1 / 2 0 1 9	C ha ng e
Ca h f lo ing iv i ies t t t s w op er a a c –	1 1, 8 7 3	1 2, 8 7 3	7. 7 % -
Ca f h lo inv iv i ies tm t a t t s w es en c –	8, 8 0 0 -	4, 9 1 7 5 -	nm
Ca h f lo f ina ing iv i ies t t s w nc a c –	6 4	1, 5 4 3 -	nm
Fr h f lo ee c as w	3, 0 7 3	1, 9 2 2 -	nm

€ 0 0 0s	H 1 / 2 0 2 0	F Y / 2 0 1 9	C ha ng e
Ca h d h len iva ts s an ca s eq u d f p d io t e a n o er	2 8 8 5, 1	2 2, 0 8 7	3. % 1 7 +
Eq ( % ) i io ty t u ra	5 0. 3	5 3. 1	2 8 0 bp s -
N de b t t e	8 4, 6 1 1	7 7, 2 5 4	9. 5 % +

• • Cash flow from operating activities down by 7.7% yoy to € 11.9 million due to increase in working capital (related to COVID-19 pandemic)
• • Capex spending mainly related to significant expansion of building capacity at HQ(expected to be completed in Q3 2020)
• • Investment ratio¹ of 9.7% for the first six months slightly below full year target corridor of around 10% to 12%

1 Total investments in intangible and tangible assets in % of sales

1. H1 2020 AT A GLANCE

2. FINANCIAL REVIEW

3. OUTLOOK

• 1. Q&A
• 1. APPENDIX

OUTLOOK

NEW FINANCIAL GUIDANCE FOR FY 20201

• • Group sales are expected to increase by 14.0% to 18.0% (at constant exchange rates)
• Additional demand due to COVID-19 pandemic expected to remain high in H2 2020
• • Adjusted EBIT margin of around 15.5% to 16.5% (2019: 13.7%)
• Positive scale effects
• Sales and product mix expected to remain strong
• • Investments in tangible and intangible assets of around 10% to 12% of sales
• Once construction projects for capacity expansion have been completed, investment ratio will likely decline considerably from 2021 onwards

•

1 Amended to account for effects of COVID-19 pandemic

PREVIOUS GUIDANCE2

• Organic sales growth in the low double-digit percentage range
• •Adjusted EBIT margin of around 15%

2 Excluding effects of COVID-19 pandemic apart from those already realized by the end of April

OUTLOOK

FOCUS IN 2020 AND BEYOND

•Manage challenges arising from COVID-19 pandemic

• Health of our employees has highest priority
• Deliver on received extra orders and support customers in making their contribution in the fight against the pandemic
• Mitigate and manage supply chain risks
• •Improve EBIT contribution of Smart Consumables segment
• •Drive working capital efficiency and improve cash flow dynamics
• •Manage lineup of newly executed agreements
• •Achievement of development targets
• •Drive further efficiency gains (earnings improvement initiative, ERP system implementation)

QUESTIONS& ANSWERS

H1 2020 FINANCIAL RESULTS – AUGUST 13, 2020 ¹⁵

APPENDIX

ADJUSTMENTS

EBIT

€ 0 0 0s	H 1 / 2 0 2 0	1 H 1 / 2 0 1 9
A d j d E B I T te us	1 8. 4 1 3	1 2. 8 0 5
A d j tm ts us en :
P P A iza io t t am or n	-4 0 7 6	-4 5 3 5
Ex lat ing io to tr ct p en se s r e an sa ns d a d iat ing str tu an sso c e re uc r ex p en se s	0	-1 2 8 5
E B I T	4. 3 3 1 7	6. 9 8 5

Retrospectively adjusted

Consolidated net income

€ 0 0 0s	H 1 / 2 0 2 0	1 H 1 / 2 0 1 9
A d j d l i da d in te te t us co ns o ne co m e fro in in io t t m c on op er a ns u g	1 5. 5 9 5	1 0. 4 5 5
A d j d in ha fro te us ea rn g s p er s re m in in io in € ( ba ic ) t t co n op er a ns s u g	3 0 1.	0. 8 7

Adjustments:

P P A iza io t t am or n	-4 0 7 6	-4 5 3 5
Ex lat d ing io to tr ct p en se s r e an sa ns an d iat ing str tu as so c e re uc r ex en se s p	0	-1 2 8 5
Ta inc xe s o n om e	6 3 7	1. 0 7 3
Co l i da d in te t ns o ne co m e fro in in io t t m co n op er a ns u g	2. 6 1 1 5	0 8 5. 7
in fro Ea ha rn g s p er s re m in in io in € ( ba ic ) t t co n u g op er a ns s	0 1. 1	0. 4 8

Retrospectively adjusted

CONTACT

STRATEC SEGewerbestr. 3775217 BirkenfeldGermany

Phone +49 7082 7916-991Fax +49 7082 7916-9190www.stratec.com

CONTACT

Marcus WolfingerCEO

Jan Keppeler, CFA Head of Investor Relations & Corporate Communications

Phone +49 7082 7916-6515 j.keppeler@stratec.com

THANK YOU FOR YOUR ATTENTION