TOMRA Systems — Earnings Release 2015

Apr 24, 2015

1 ST QUARTER 2015 RESULTS ANNOUNCEMENT

TOMRA SYSTEMS ASA 24th April 2015

HIGHLIGHTS FROM THE QUARTER INCLUDE

Orders TOMRA Sorting	• All time high order intake of 573 MNOK compared to 488 MNOK same period last year • All time high order backlog of 822 MNOK, up from 657 MNOK at the end of fourth quarter 2014
Revenues	• Revenues of 1,107 MNOK (1,022 MNOK in first quarter 2014). Currency adjusted revenues were: - Down 2% for TOMRA Group - Down 1% in TOMRA Collection - Down 4% in TOMRA Sorting
Gross margin	• Gross margin 43%, unchanged from first quarter 2014 (currency adjusted) - Overall stable margins
Operating expenses	• Operating expenses of 369 MNOK (338 MNOK in first quarter 2014) - Up 3% adjusted for currency and one-time cost in 2014
EBITA	• EBITA of 104 MNOK (107 MNOK in first quarter 2014)
Cashflow from operations	• Cashflow from operations of 50 MNOK (12 MNOK in first quarter 2014)
Other	• Divestment of Compaction completed

CURRENCY

Revenues and expenses per currency; NOTE: Rounded figures

	EUR*	USD	NOK	SEK	OTHER	TOTAL
Revenues	45 %	30 %	5 %	10 %	10 %	100 %
Expenses	45 %	25 %	10 %	10 %	10 %	100 %
EBITA	45%	50 %	- 15 %	10 %	10 %	100 %
* EUR includes DKK	Mainly CNY

FINANCIAL HIGHLIGHTS P&L STATEMENT

		1st Quarter
Amounts in NOK million	2015	2014	14 Adj*
Revenues	1,107	1,022	1,127
• Collection Solutions	699	633	702
• Sorting Solutions	408	389	425
Gross contribution	473	445	487
in %	43%	44%	43%
Operating expenses	369	338	368
EBITA	104	107	119
in %	9%	10%	11%
One time costs included in operating expenses	-	12	12

* 2014 actual restated at 2015 exchange rates, estimated

** Adjusted for one time costs

FINANCIAL HIGHLIGHTS BALANCE SHEET, CASH FLOW AND CAPITAL STRUCTURE

Amounts in NOK million	31 March 2015	31 March 2014	31 Dec 2014
ASSETS	6,412	5,661	6,625
• Intangible non-current assets	2,583	2,485	2,623
• Tangible non-current assets	701	586	683
• Financial non-current assets	317	297	307
• Inventory	1,050	936	913
• Receivables	1,468	1,278	1,537
• Cash and cash equivalents	293	79	436
• Assets held for sale	-	-	126
LIABILITIES AND EQUITY	6,412	5,661	6,625
• Equity	3,317	2,732	3,244
• Minority interest	130	85	115
• Interest bearing liabilities	1,359	1,494	1,649
• Non-interest bearing liabilities	1,606	1,350	1,593
• Liabilities held for sale	-	-	24

Ordinary cashflow from operations

• 50 MNOK (12 MNOK in 1Q 2014)

Solidity

• 52% equity
• NIBD/EBITDA = 1.2 (Rolling 12 months)

Dividend

• Dividend of NOK 1.45 per share

NEW GEOGRAPHIC SEGMENTS

Old segments			2014			New segments			2014
Figures in NOK million	1Q14	2Q14	3Q14	4Q14	Total	Figures in NOK million	1Q14	2Q14	3Q14	4Q14	Total
Collection Solutions						Collection Solutions
Revenues						Revenues
- Nordic	101	107	84	125	417	- Nordic	101	107	84	125	417
- Central Europe & UK	293	281	313	385	1 272	- Europe (ex Nordic)	294	284	316	386	1 280
- Rest of Europe	1	3	3	1	8	- North America	234	277	285	298	1 094
- North America	234	277	285	298	1 094	- Rest of World	4	10	10	8	32
- Rest of World	4	10	10	8	32	Total revenues	633	678	695	817	2 823
Total revenues	633	678	695	817	2 823
						Sorting Solutions
Sorting Solutions						Revenues
Revenues						- Europe	163	212	195	317	887
- Nordic	2	3	4	8	17	- North America	146	163	161	106	576
- Central Europe & UK	110	164	147	205	626	- South America	6	3	49	17	75
- Rest of Europe	51	45	44	104	244	- Asia	59	48	46	85	238
- North America	146	163	161	106	576	- Oceania	5	21	23	38	87
- Rest of World	80	86	137	160	463	- Africa	10	14	19	20	63
Total revenues	389	461	493	583	1 926	Total revenues	389	461	493	583	1 926

HIGHLIGHTS FROM THE 2015 AGM

• The annual general assembly took place 23 April 2015 at TOMRA HQ in Asker, Norway
• Dividend of NOK 1.45/share (up from NOK 1.35/share last year) was approved
• Payment date 5 May 2014
• New Chairman: Jan Svensson
• New Board member: Linda Bell (CEO PhosphonicS Ltd)
• Proxy to acquire up to 10% of the share capital in connection with potential mergers and acquisitions

TOMRA Collection Solutions

HIGHLIGHTS COLLECTION SOLUTIONS

Overall	• Revenues equaled 699 MNOK in first quarter 2015, up from 633 MNOK in first quarter 2014 - Adjusted for currency, revenues were down 1% • Gross margin was 42% - Negative mix effect from higher Material Recovery revenues • Operating expenses equaled 183 MNOK, - Up 3% currency adjusted from same period last year • EBITA decreased to 108 MNOK, down from 111 MNOK, - Positively influenced by currency gains - Negatively influenced by lower GM% and increased operating expenses
Europe	• Increased sales in the Nordic region • Good momentum in Central Europe, despite somewhat weak first quarter performance due to timing of orders
US	• Revenues stable in local currencies (but significantly up measured in NOK) • Severe weather negatively influencing volumes (but limited effect vs first quarter 2014, which also had severe weather conditions)

COLLECTION SOLUTIONS FINANCIALS

		1st Quarter
Amounts in NOK million	2015	2014	14 Adj*
Revenues	699	633	702
• Nordic	118	101
• Europe (ex Nordic)	272	294
• North America	299	234
• Rest of the world	10	4
Gross contribution	291	271	297
in %	42%	43%	42%
Operating expenses	183	160	177
EBITA	108	111	120
in %	15%	18%	17%

* 2014 actual restated at 2015 exchange rates, estimated

T-90, THE NEXT MACHINE BUILT ON THE T-9 PLATFORM

Tomra Collection Solutions will introduce another innovative reverse vending machine, the T-90, in the fall this year. Utilizing the same revolutionary technology platform (Flow Technology) as the T-9, the T-90 will provide unique benefits related to appearance, speed, cleaning and handling of odd shapes and sizes. T-90 replaces the old T-83 and is expected to play a key role in North America, Germany and Nordic markets.

TOMRA Sorting Solutions

HIGHLIGHTS SORTING SOLUTIONS

TSS NEW PRODUCT LAUNCHES (12 MONTHS)

Food & Specialty Products

Blizzard Camera/Pulsed LED sorter

IQF Fruit & Vegetables Foreign Material, Discolorations, Size/ Shape

Falcon Pre-sorter camera Lettuce Gross Defects, Foreign Material

Nimbus BSI Laser/ camera sorter IQF Fruit & Vegetables, Nuts, Dried Fruit Foreign Material, Discolorations, Size/ Shape, AFMD, Detox™, FLUO

Recycling & Mining Products

Modus Optical Size Grader Carrots & Potatoes Size, Length, Width, Estimated Weight

Sentinel II Camera/Pulsed LED sorter Whole fruits & Veg Colour, Defect & Food Safety

FINDER (New Generation)

EM Sensor metal sorter Metals Material

Com Tertiary XRT

Belt based sorter XRT X-ray transmission Small particles

BUSINESS STREAM UPDATE

FOOD

• Revenues were slightly down in 1Q15 compared to 1Q14.
• Good order intake during 1Q15, significantly better than both 1Q14 as well as recent quarters.
• Limited number of orders taken P/L, combined with good order intake has further improved the order backlog, currently at all time high.

RECYCLING

• Revenues were stable 1Q15 compared to 1Q14
• Order intake has increased slightly compared to previous quarters, despite negative momentum in metals and plastic (PET) recycling
• Order backlog improved during first quarter

MINING

• Revenues in 1Q15 significantly up from 1Q14
• Order intake down quarter over quarter (due to high intake in 1Q14)
• Order backlog somewhat up

SORTING SOLUTIONS FINANCIALS

		1st Quarter
Amounts in NOK million	2015	2014	14 Adj*
Revenues	408	389	425
• Europe	208	163
• North America	111	146
• South America	13	6
• Asia	59	59
• Oceania	11	5
• Africa	6	10
Gross contribution	182	174	190
in %	45%	45%	45%
Operating expenses	178	171	184
EBITA	4	3	6
in %	1%	1%	1%
One time costs included in operating expenses	-	12	12

* 2014 actual restated at 2015 exchange rates, estimated

BACKLOG DEVELOPMENT AND MOMENTUM

• Good order intake (all time high in NOK), combined with few orders taken to P/L, created a strong order backlog at the end of first quarter 2015 (all time high)
• Estimated backlog conversion ratio in 2Q15: 65- 70%*

Business Outlook

OUTLOOK

Collection Solutions:

• No new markets are expected to generate significant revenues in the coming quarters, but replacement opportunities in the German market are expected to improve performance going forward.
• On the back of a somewhat weak first quarter 2015, activity is expected to develop positively, and 2015 in total is expected to be stronger than 2014, both in respect of revenues and EBITA.

Sorting Solutions:

• The business area ended first quarter 2015 with an all time high order backlog, and second quarter 2015 is consequently expected to be strong and materially better than second quarter 2014.

Currency:

• Reporting in NOK and with some NOK cost base, TOMRA will in general benefit from a weak NOK, measured particularly against EUR and USD. TOMRA will consequently continue to gain from a strong USD and EUR, provided current exchange rate levels are maintained.

Copyright

The material in this Document (which may be a presentation, video, brochure or other material), hereafter called Document , including copy, photographs, drawings and other images, remains the property of TOMRA Systems ASA or third party contributors where appropriate. No part of this Document may be reproduced or used in any form without express written prior permission from TOMRA Systems ASA and applicable acknowledgements. No trademark, copyright or other notice shall be altered or removed from any reproduction

Disclaimer

This Document (which may be a presentation, video, brochure or other material), hereafter called Document, may include and be based on, inter alia, forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. The content of this Document may be based on current expectations, estimates and projections about global economic conditions, including the economic conditions of the regions and industries that are major markets for TOMRA Systems ASA and its subsidiaries and affiliates. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions, if not part of what could be clearly characterized as a demonstration case. Important factors that could cause actual results to differ materially from those expectations include, among others, changes in economic and market conditions in the geographic areas and industries that are or will be major markets for TOMRA Systems ASA. Although TOMRA Systems ASA believes that its expectations and the Document are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Document. TOMRA Systems ASA does not guarantee the accuracy, reliability or completeness of the Document, and TOMRA Systems ASA (including its directors, officers and employees) accepts no liability whatsoever for any direct or consequential loss arising from the use of this Document or its contents. TOMRA Systems ASA consists of many legally independent entities, constituting their own separate identities. TOMRA is used as the common brand or trade mark for most of these entities. In this Document we may sometimes use "TOMRA", "TOMRA Systems", "we" or "us" when we refer to TOMRA Systems ASA companies in general or where no useful purpose is served by identifying any particular TOMRA Company

TOMRA SHAREHOLDER STRUCTURE

1 Investment AB Latour 35 690 000 24.7% 2 Folketrygdfondet 15 299 512 10.7% 9 % 5% 3 Skandinaviska Enskilda A/C Clients account 5 015 560 3.4% (NOM) 6% 4 Jupiter European Fund 4 329 651 2.9% 9% 5 Nordea Nordic Small 4 165 817 2.8%	by country
	30%
12 % 6 ODIN Norge 3 430 463 2.3%
29 % 7 Verdipapirfondet DnB 2 825 083 1.9%
8 Skandinaviska Enskilda A/C Finnish Resident 2 566 469 1.7% (NOM)
Sweden Norway 9 Clearstream Banking 2 026 170 1.4% (NOM)	Great Britain
USA Luxembourg 10 The Bank of New York BNY Mellon 1 981 126 1.3% (NOM) Others	Finland
Sum Top 10 78 799 851 53.2%
Other shareholders 61 577 710 46.8%
TOTAL (5,796 shareholders) 148 020 078 100.0%

Source: VPS