technotrans SE — Investor Presentation 2020

Mar 30, 2020

PRESENTATION OF THE RESULTS FOR THE FINANCIAL YEAR 2019

March 10, 2020

OVERVIEW OF THE 2019 FINANCIAL YEAR

technotrans meets its forecast for 2019

• › Group revenue at € 207.9 million (- 3.9%). Fourth quarter exceeds expectations
• › Operating result (EBIT) positive at € 8.3 million, but significantly below previous year (- 52%)
  • › economic environment and one-offs are weighing on profitability
• › Positive free cash flow of € 7.6 million (previous year: minus € 3.8)
• › Electric mobility continues to gain momentum
• › Medical technology: important milestone reached following positive clinical tests
• › termotek starts production at new location in August 2019 und sets new standards for lean production and energy efficiency in the group

REVENUE AND EBIT – PERFORMANCE AND OUTLOOK

• › Group revenue of € 207.9 million below previous year
• › ERP-implementation at gwk and difficult economic environment slow down group growth
• › Operating result (EBIT) at € 8.3 million › EBIT margin reaches 4.0 %
• › Losses in productivity are weighing on the Technology segment:
  • › Effects of the ERP-implementation at gwk
  • › One-time special effects in the amount of € 1.4 million

› Outlook 2020:

• › cautious regarding the economic environment
• › optimistic about the potentials of technotrans

KEY PERFORMANCE INDICATORS

Earnings per Share 2010 - 2019

Free Cash Flow positive figures in million €; share price in € 6.3 3.6 13.2 -3.4 4.8 8.5 -12.6 0.2 -3.8 7.6 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Equity ratio on a solid level

Net debt incl. leasing liabilities increased

DIVIDEND POLICY

The Board of Management and the Supervisory Board propose a dividend distribution of € 0.44 per share for FYE 2019.

dividend in € / dividend yield in %

Reisner develops according to plan.

BUSINESS DEVELOPMENT IN OUR MARKETS

Printing industry: Economy slows down development. Position in flexographic printing further strengthened.	-
Laser and machine tool industry Gains in market share partially offset declining investment activity.	o
Growth markets: Electric mobility: Growth trend continues. Market penetration for mobile refrigeration solutions for special vehicles increased.	++
Medical technology, EUV technology: Positive development due to development of new technologies. technotrans OP solution before approval.	+
Plastics processing industry: Process-related problems from ERP implementation in financial year 2019 solved. Operating performance is gradually and on schedule returning to normal.	o/-

Outlook 2020

PERFORMANCE SEGMENT TECHNOLOGY

Economy and gwk are weighing on revenue and EBIT

Annual revenue 2017-2019 (€m)

Annual EBIT/EBIT margin 2017-2019 (€m / %)

8 technotrans | March 10, 2020

EBIT 2018/2019 by quarters (€m)

PERFORMANCE SEGMENT SERVICES

Robust development despite difficult economic environment

Annual EBIT/EBIT margin 2017-2019 (€m/%)

9 technotrans | March 10, 2020

BALANCE SHEET RATIOS

ASSETS	FY 2019	FY 2018			EQUITY AND LIABILITIES

*) Total increase of € 3.8 million due to first-time application of the changed disclosure of leasing contracts in accordance with IFRS 16. FY 2018 not adjusted.

Return on equity 2017-2019 (%)

ASSETS	FY 2019		FY 2018		EQUITY AND LIABILITIES	FY 2019		FY 2018
	mio. €	%	mio. €	%		mio. €	%	mio. €	%
Non-current assets *)	69.8	47.8	61.4	45.1	Equity	75.1	51.4	75.2	55.3
Current assets	76.2 52.2		74.6	54.9	Non-current liabilities *)	37.8	25.9	28.7	21.1
					Current liabilities *)	33.1	22.7	32.1	23.6
Total assets	146.0	136.0 100.0		100.0	Total assets	146.0	100.0	136.0	100.0

*) Increase of liabilities (€ 2.1 million non-current, € 2.6 million current) due to first-time application of the changed disclosure of leasing liabilities in accordance IFRS 16. FY 2018 not adjusted.

Net Debt & Net Debt / EBITDA ratio 2017-2019 (million €)

figures not adjusted.

FINANCIAL POSITION

Financial liabilities 2016-2019 short-term/long-term (million €)

2019: Increase of liabilities (€ 2.1 million non-current, € 2.6 million current) due to firsttime application of the changed disclosure of leasing liabilities in accordance IFRS 16. FY 2018 not adjusted.

Cash 2017-2019 (million €)

Net-Working Capital/NWC Ratio 2017-2019 (million € + %)

INTERNATIONAL FOOTPRINT

Revenue by region Employees by region

	2019		2018
	number	in %	number	in %
Employees at year end	1,474	100	1,453	100
Employees by region
Germany	1,320	89.6	1,302	89.6
Other Europe	52	3.5	50	3.5
America	49	3.3	49	3.4
Asia and Australia	23	3.6	52	3.5

BUSINESS MODEL

BUSINESS MODEL

THE TECHNOTRANS GROUP

Termotek founded 1998 (ttGROUP2011)

Hauptsitz (founded 1970) tt Taicang founded 2013 (ttGROUP2013)

Headquarter:

technotrans SE, Sassenberg, Germany

gwk founded 1967 (ttGROUP2016)

KLH founded 1961 (ttGROUP2013) Reisner founded 1980 (ttGROUP2018) tt america founded 2000 (ttGROUP2000)

• › 1,460 employees
• › IPO: 1998
• › 18 locations, thereof 7 production sites (5 x Germany, China, USA)
• › Worldwide sales- and services network

TECHNOTRANS – THE GROUP

MID-TERM TARGETS 2022/23

Revenue € 250m + € 50m	Organic growth › − 5 – 6 % p.a. − Increase market share by raising revenue with existing and new customers and developing new products M & A › − Step into new markets and new applications − Develop technological expertise by strategic supplements − Optimize the international footprint
EBIT margin ≈ 10 % p.a.	Efficiency program › Establish single- and multi-purpose sites (manufacturing footprint) › Increase utilisation, flexibility and quality › Enhance operational excellence › Consolidate production volumes › Realise additional synergy potentials › Reduce complexity and share of fixed costs ›

GROUP STRATEGY 2020 – 2025

"SHAPING THE FUTURE THROUGH DEVELOPMENT!"

• Create an integrated Group to reinforce the global brand "technotrans"
• Establish industry focus in sales independent from location
• Enhance competecies of locations in order to prevent parallel structures
• Improve innovative strength
• Adjust organisational structure
• Leverage additional synergies, expand shared service functions

2020 - 2025

GROUP STRATEGY 2020 – 2025

COMPONENTS OF SITE-RELATED STRUCTURAL MEASURES

MANAGEMENT

Dirk Engel (Dipl. Kfm.)

• › Spokesman of the Board of Management (DOB 1967)
• › Since 2004 Head of Corporate Accounting, since 2006 Chief Financial Officer, since March 12, 2018 Spokesman of the Board of Management
• › Responsible for Finance and Administration (Finance/Controlling, Human Resources, IT, Legal &

Compliance and Investor Relations)

Peter Hirsch (Dipl.-Ing.)

• › Member of the Board of Management (DOB 1972)
• › Since 2013 Business Development Manager, since 2014 Managing Director of termotek GmbH, since July 1, 2018 member of the Board of Management
• › Responsible for Technology & Operations (Research & Development, Electrical engineering, Business Units, Production, Purchasing and Logistics)

Hendirk Niestert (Dipl.-Ing. FH)

• › Member of the Board of Management (DOB 1975)
• › Since 2007 Head of Service, since February 1, 2018 member of the Board of Management
• › Responsible for Markets (Sales, Service, Quality Management and Marketing)

THE TECHNOTRANS SHARE

TECHNOTRANS SHARE AND SHAREHOLDER STRUCTURE

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Market capitalisation: € 116.7 million (March 6, 2020) Dividend policy: Distribution of up to 50% of the consolidated net profit

PERFORMANCE OF SHARE PRICE AND RESEARCH

January 1st – December 31st 2019

Publications	· Ad-hoc informat

2019:	Share Price as	Market Cap as
Max:	of	of
30.00 Min:	30/12/2019:	30/12/2018:
24.00	€ 18.70	€ 129.2 Mio.
	Share Price as of 06/03/2020: € 16.90	Market Cap as of 06/03/2020: € 116.7 Mio.

Aktienkurse = XETRA Schlußkurse

		Research
Bankhaus Lampe	TP € 17.00, hold	2019-12-11
Warburg Research	TP € 26.40, buy	2019-11-06
Hauck + Aufhäuser	TP € 33.00, buy	2019-09-13
HSBC	TP € 25.00, buy	2020-02-25
Commerzbank	TP € 22.00, hold	2020-02-06
Berenberg	TP € 20.00, buy	2019-11-05

WHAT MAKES AN INVESTMENT IN TECHNOTRANS ATTRACTIVE?

› Niche focused business model

• › High entry barriers due to specific know how in the area of fluid management and focus on customized solutions
• › Diversified product portfolio focused on growth markets
• › Limited cyclicity through extensive additional services
• › International network as a base for the development of new customers and markets
• › Growth strategy focused on revenue and profitability
• › Attractive divided policy
• › Committment to sustainability

FINANCIAL CALENDAR 2020

May 12, 2020	Quarterly Communication 1-3/2020
May 20, 2020	Annual Shareholder Meeting 2020
August 11, 2020	Interim Report 1-6/2020
November 10, 2020	Quarterly Communication 1-9/2020

EVENTS 2020

March 11, 2020	Berenberg European Opportunities Konferenz, London
	(participation via conferennce call)
March 19, 2020	ESN Market Solutions Forum Konferenz, Paris
March 24, 2020	Bankhaus Lampe Deutschlandkonferenz, Baden-Baden
June 26, 2020	Warburg Highlights Konferenz, Hamburg
November 16-17, 2020	German Equity Forum, Frankfurt

CONTACT

Frank Dernesch Manager Investor Relations & Corporate Finance

Tel. +49 (0)2583 301-1868 Fax +49 (0)2583 301-1054 frank.dernesch@technotrans.de

This presentation contains statements on the future development of the technotrans Group.

These reflect the present views of the management of technotrans SE and are based on the corresponding plans, estimates and expectations. We point out that the statements are subject to certain risks and uncertainties which could mean that the actual results differ considerably from those expected.

CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2019

ASSETS
	Note	31/12/2019	31/12/2018
		€ '000	€ '000
Non-current assets
Property, plant and equipment	(1)	33,268	28,583
Right-of-use asset	(2)	3,846	0
Goodwill	(3)	23,513	23,513
Intangible assets	(4)	7,493	7,693
Other financial assets	(5)	185	162
Deferred tax	(28)	1,484	1,466
Current assets		69,789	61,417
Inventories	(6)	28,257	28,296
Trade receivables	(7)	24,039	27,111
Income tax receivable	(8)	349	629
Other financial assets	(Ə)	733	758
Other assets	(Ə)	1,926	2,255
Cash and cash equivalents	(10)	20,910	15,566
		76,214	74,615
Total assets		146,003	136,032

EQUITY AND LIABILITIES
	Note	31/12/2019	31/12/,2018
		€ '000	€ '000
Equity	(11)
Issued capital		6,908	6,908
Capital reserve		19,097	19,097
Retained earnings		49,367	43,282
Other reserves		-6,394	-6,426
Net profit for the period		6,089	12,383
Total equity attributable to technotrans SE shareholders		75,067	75,244
Non-current liabilities
Borrowings	(12)	33,760	25,956
Employee benefits	(16)	809	927
Provisions	(17)	O	15
Other financial liabilities	(13)	2,607	614
Deferred tax	(28)	657	1,220
		37,833	28,732
Current liabilities
Borrowings	(12)	6,696	8,431
Trade payables	(14)	ട്, കടട	6,712
Prepayments received	(15)	4,242	3,115
Employee benefits	(16)	5,154	6,253
Provisions	(17)	3,891	3,498
Income tax payable	(18)	745	700
Other financial liabilities	(19)	2,991	800
Other liabilities	(19)	3,432	2,547
		33,103	32,056
Total equity and liabilities		146,003	136,032

CONSOLIDATED INCOME STATEMENT

	Note	2019	2018
		€ '000	€ '000
Revenue	(20)	207,927	216,286
of which Technology		148,424	156,476
of which Services		59,503	59,810
Cost of Sales	(21)	- 146,612	- 146,646
Gross profit		61,315	69,640
Distribution costs	(22)	-25,606	-25,736
Administrative expenses	(53)	- 18,760	- 19,275
Development costs	(24)	- 7,575	- 7,946
Net impairment losses on financial and contract assets	(7)	- 510	-530
Other operating income	(25)	1,911	2,379
Other operating expenses	(26)	- 2,437	- 1,181
Earnings before interest and taxes (EBIT)		8,338	17,351
Financial income		630	499
Financial charges		-763	-543
Net finance costs	(27)	- 133	- 44
Profit before tax		8,205	17,307
Income tax expense	(28)	- 2,116	-4,924
Net profit for the period		6,089	12,383
of which:
Profit attributable to technotrans SE shareholders		6,089	12,383
Earnings per share (€)	(29)
basic / diluted		0,88	1,79

CONSOLIDATED CASH FLOW STATEMENT JAN. 1, 2019 – DEC. 31, 2019

	Note	2019	2018 € '000
		€ '000
Cash flow from operating activities	(30)
Net profit for the period		6,089	12,383
Adjustments for:
Depreciation and amortisation		7,670	5,248
Income tax expenses	(28)	2,115	4,924
Gain (-)/loss (+) on the disposal of property, plant and equipment	(25), (26)	-142	- 106
Foreign exchange losses (+)/gains (-)		- 46	-33
Net finance costs	(27)	133	44
Cash flow from operating activities before working capital changes		15,819	22,460
Change in:
Inventories	(6)	38	- 950
Receivables and other current assets		3,402	- 3,993
Liabilities and prepayments		1,178	-2,301
Provisions and employee benefits	(16), (17)	- 863	- 404
Cash from operating activities		19,574	14,812
Interest received		15	26
Interest paid		-630	-510
Income taxes paid/income tax rebates		- 2,158	- 8,016
Net cash from operating activities		16,801	6,312
Cash flow from investing activities	(31)
Cash payments for investments in property, plant and equipment and in intangible assets		- 9,363	-8,381
Cash payments for the acquisition of consolidated companies		O	- 2,065
Proceeds from the sale of property, plant and equipment		210	381
Net cash used for investing activities		-9,153	- 10,065

	Note	2019	2018
		€ '000	€ '000
Cash flow from financing activities	(32)
Cash receipts from the raising of short-term and long-term loans		17,500	15,200
Cash payments from the repayment of loans		- 11,431	-3,837
Distribution to investors		-6,079	-6,079
Cash payments from the repayment of lease liabilities		-2,356	0
Payment for the acquisition of non-controlling interests		0	-820
Net cash used in financing activities		- 2,366	4,464
Net increase/decrease in cash and cash equivalents		5,282	711
Cash and cash equivalents at start of period		15,566	14,798
Net effect of currency translation in cash and cash equivalents		62	57
Cash and cash equivalents at end of period	(10), (33)	20,910	15,566