STS Group AG

Investor Presentation • Nov 21, 2018

Investor Presentation November 21, 2018

Agenda

1. STS at a Glance

• 1. IPO Strategic Projects
• 1. Business Overview

STS Group at a Glance

• u One of the leading global suppliers of soft and hard trim parts and systems to international commercial vehicle OEMs with over 80 years of experience.
• u Balanced product portfolio with diversified customer base.
• u Significant share of business as single source.
• u Vertical integration contributes to stable performance.
• u Highly attractive growth prospects based on market penetration and expansion in existing and new geographies along existing portfolio.

Key Facts Key Figures

425 mEUR	Pro-Forma Revenue 2017
24 mEUR	Adjusted Pro-Forma EBITDA 2017
1.9+ bnEUR	Order Backlog 2018-2022
2,500+	Employees
17	Sites
4	R&D Centers
80+	Years in the Industry

STS Group is one of the leading integrated commercial vehicle parts supplier.

NVH - Noise Vibration Harshness

Agenda

• 1. STS at a Glance
• 2. IPO - Strategic Projects
• 1. Business Overview

Expanding in China

• u China is the worlds biggest market for medium and heavy commercial vehicles (MHCV).
• u STS will gain market share significantly. based on technology know-how, quality and customer contact.
• u Newly implemented restrictions and regulatory changes (longnose, EURO6), are expected to have positive effect on truck demand.

Medium and heavy vehicle production Greater China 1) (1,000 units/year)

2017	2018	2019	2020	2021	2022	2023	2024
1,500	1,350	1,200	1,200	1,150	1,200	1,150	1,200

1) Based on management estimates

Construction of the third plant in China, Shiyan, is on schedule.

• u Start of production is expected in Q1 2019.
• u 19,000 sqm building area.
• u SMC thermocompression, injection molding, robot milling, painting.

New headquarter and R&D center in Wuxi is on schedule.

• u Opening end of 2018.
• u 1,000 sqm.
• u Wuxi is tech-hub, attractive location for good people.
• u 10 km to Shuofang International Airport.

Entering the US Market

• u North America is the worlds third biggest market for medium and heavy commercial vehicles (MHCV).
• u Great demand for technological progress, such as light-weight plastic based components.
• u High number of new projects.

2017	2018	2019	2020	2021	2022	2023	2024
530	570	580	570	560	560	550	560

1) Based on management estimates 2) Trucker magazine

First order from premium NAFTA truck brand.

STS - Ramos

• u New customer.
• u SMC exterior part.
• u Program lifetime 10 years with SOP 2020.
• u Strategically relevant.

Technology transfer bares strong options.

• u High number of RFQ.
• u Need for STS technology.
• u Strong demand for STS products, with high standard in technology, productivity and quality.

www.sts.group STS Group © 2018 Slide 8

STS - Międzyrzecz

Improving Footprint in Europe

• u Europe is the worlds second biggest market for medium and heavy commercial vehicles (MHCV).
• u Poland is the Best Cost country in Europe for Commercial Vehicle Interior Trim.

Medium and heavy vehicle production Europe 1) (1,000 units/year)
2017	2018	2019	2020	2021	2022	2023	2024
660	670	700	730	770	800	830	860

1) Based on management estimates 2) Trucker magazine

Greenfield Plant Międzyrzecz is ramping up.

• u Total capacity 600,000 parts/a.
• u Lean Batch and JIS production for European Truck OEMs.
• u Expansion: High number of new RFQ.

PVC Lining

u STS invests into latest technology for PVC Vacuum Lamination.

Product Innovation

Entry to electromobility market with order for battery cover for e-SUV.

• u New customer.
• u Volume: 30,000 per year.
• u SOP second half 2019.

Tech-Days in Jiangyin strengthen cooperation with market.

• u 30 participants from 19 OEMs from automotive industry.
• u Exchange information with actual and potential customers.
• u Strengthen STS' leading technical supplier image.

Strong need for tier 1 system suppliers.

• u High interest in parts for e-mobility (e.g. battery cover).
• u The four STS R&D centers in France, Italy and China linked their expertise and work in close cooperation.
• u STS combines acoustic, esthetic and structural functions.
• u STS further develops low density SMC (light weight).

Process Innovation Automation

Fully automated machine loading.

u High productivity. u High quality.

Fully automated milling and deburring.

• u Difficult geometry possible.
• u High productivity.
• u High accuracy.

Agenda

• 1. STS at a Glance
• 1. IPO Strategic Projects
• 3. Business Overview

Income

•	Sales 9M/2017
	increased (mEUR 202)
	by >50% 309 mEUR to
	for the due 9M/2018
	acquisition to past

Statement	mEUR IFRS	9M/2018	9M/2017
	Revenue	309.2	201.5
	Inventory changes	0.7	0.9
	Other operating income	3.2	47.8
	Cost of materials	-176.6	-126.6
	Personnel expenses	-78.8	-50.0
	Other operating expenses	-47.4	-23.5
	EBITDA	10.2	49.9
• Sales 9M/2017 increased (mEUR 202) by >50% 309 mEUR to for the due 9M/2018 acquisition to past • Adjusted EBITDA	Depreciation and amortisation	-9.9	-4.8
	EBIT	0.3	45.2
	Financial result	-1.6	-0.9
	EBT	-1.2	44.3
	Taxes	-1.6	1.0
	Net result	-2.9	45.3
margin increased to	Adjusted EBITDA	21.1	8.2
6 8%	Adjusted EBITDA in % of revenue	6.8%	4.1%

Key Financials 9M/2018

www.sts.group STS Group © 2018 Slide 14

Balance

• Reduction in inventories and increase of contracted assets reflects first-time adoption of IFRS 15 by June 30, 2018.
• Cash and cash equivalents amount increased to 28.9 mEUR.
• Equity ratio increase to 30%.
• Liabilities to banks and third parties 22.4 mEUR.

Sheet	mEUR	IFRS	Sept. 30 2018	Dec. 31 2017
	Intangible assets		24.9	24.6
		Property, plant and equipment	77.0	79.0
	Other financial assets		0.2	0.3
	Tax receivables		0.2	1.6
	Other assets		2.5	0.8
	Deferred tax assets		11.6	8.6
	Non-current assets		116.4	114.8
	Inventories		23.9	28.1
	Contract assets		7.5	0.0
• Reduction in inventories		Trade and other receivables	90.5	99.3
and increase of	Other financial assets		1.0	13.1
contracted reflects assets	Other assets		9.1	3.8
first-time adoption of by IFRS 15 June 30 2018	Tax receivables		0.1	0.0
, Cash and cash • equivalents amount		Cash and cash equivalents	28.9	15.8
	Restricted cash		2.0	0.0
increased 28 9 mEUR to	Current assets		163.0	160.2
	Total assets		279.4	275.0

mEUR IFRS	Sept. 30	Dec. 31
	2018	2017
Total equity	83.5	60.7
Trade payables	0.7	0.6
Other financial liabilities	14.7	17.1
Provisions	21.3	21.1
Income tax liabilities	0.1	0.0
Deferred tax liabilities	7.7	7.0
Non-current liabilities	44.5	45.9
Trade payables	50.1	65.5
Other financial liabilities	62.6	64.0
Provisions	1.1	3.4
Income tax liabilities	2.3	1.7
Other non-financial liabilities	35.4	33.9
Current liabilities	151.5	168.4
Total equity and liabilities	279.4	275.0
Equity ratio in %	30%	22%

Net Debt

mEUR IFRS	Sept. 30, 2018	Dec. 31, 2017
Cash and cash equivalents*	30.9	15.8
Other financial assets Mutares AG	0.0	5.0
Liabilities to banks and 3rd party loans	-22.4	-24.5
Factoring	-36.0	-37.2
Net debt	-27.6	-40.8

• Liabilities to banks 15.0 mEUR and 3rd party loans 7.4 mEUR.
• Factoring used within BU Acoustics (Italy) and BU Plastics (France).

*includes restricted cash

Why invest in STS Group?

One of the leading global system suppliers for interior and exterior trim parts with focus on commercial vehicles

Solid order book with approx. 1.9 bnEUR of revenue already contracted until 2022, plus additional pipeline

Trusted Tier 1 partner for leading European and Chinese truck OEMs with significant cross-selling potential through combination of technologies

Expansion in China to benefit from strong truck market and direct entry into the US with own production

Vertically integrated along the value chain and technological expertise resulting in full process control and securing competitive advantage

Material and process know-how as significant and customer-relevant entry barriers, matching industry trends emission and weight reduction

Financial Calendar

2018
1 June 2018	Listing in Prime Standard of Frankfurt Stock Exchange
1 June 2018	Publishing of 3-month report
5 September 2018	Zürcher Kapitalmarktkonferenz, ZKK
26 September 2018	Publishing of semi-annual report 2018
21 November	Publishing of 9-month report
21 November	Public financial analysts conference call
26 November	German Equity Forum Frankfurt

Disclaimer This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. STS Group AG has based these forward-looking statements on its current views and expectations and on certain assumptions of which many are beyond STS Group AG's control. Actual financial performance could differ materially from that projected in forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and STS Group AG does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.

This presentation includes references to non-IFRS financial measures, including, but not limited to: FCF, EBITDA, EBITA, EBIT, EBITA margin, capital expenditure as percentage of revenue, other operating income, net financial debt, and net working capital. We have provided these measures and other information in this presentation because we believe they provide investors with additional information to assess our performance. Our use of these supplemental financial measures may vary from others in our industry and should not be considered in isolation or as an alternative to our results as reported under IFRS.

Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

Thank you for your attention

Contact Us

Susan Hoffmeister Investor Relations ir@sts.group