Tesmec S.p.a. · MIL:TES

Tesmec — 9M 2014 Earnings Presentation

22 slides from Tesmec's earnings presentation, Nov 7, 2014

1. Slide 1: Tesmec Group Corporate Presentation

   Tesmec Group Corporate Presentation Analyst Presentation November 7, 2014

2. Slide 2: Complete offer of advanced solutions

   Complete offer of advanced solutions ENERGY RAILWAY UNDERGROUND INFRASTRUCTURES Power lines Construction & Electrification & Maintenance equipment Maintenance railcars Trenchers & Surface Miners & & & Grid Management & Special applications & Services & job site Automation Devices Hybrid Power Units

3. Slide 3: Tesmec Technological solutions

   Tesmec Technological solutions UNDERGROUND ENERGY RAILWAY INFRASTRUCTURES Power lines Construction & Railway line Construction & Large-scale infrastructure Maintenance Maintenance Underground Cables Laying Special application Shale Gas & Oil Energy Automation New eco-friendly technology Drainage & D

4. Slide 4: Main highlights update - Energy Business - Brazil

   Main highlights update - Energy Business - Brazil Abengoa, the largest international contractor in T&D, has been awarded a 30 year concessions for 6 T&D lines, which will cover a total distance of over 5.000 km. The whole developing period of the project will take 3 years. During the first 2 years,

5. Slide 5: Main highlights update - Energy Business - Brazil

   Main highlights update - Energy Business - Brazil  Tesmec has been awarded a contract from Abencor Suministros SA (wholly owned subsidiary of Abengoa) to supply stringing equipment for one of the largest construction projects of 500kV lines in Brazil:  Project: 5.416 km of 500kV lines  Supply: 70

6. Slide 6: Main highlights update - Energy Business

   Main highlights update - Energy Business  The Group is collecting orders in the automation field both in Transmission and Distribution sectors.  SGE got the first important order of fault detection devices in South America (ENEL).  BERTEL got orders in Turkey for its devices  USA: detailed marke

7. Slide 7: Main highlights update - Railway Business

   Main highlights update - Railway Business  Partnership with:  RFI - for the development of efficient maintenance method of railway power lines  ZF Friedrichshafen AG - in the field of hybrid engines for rail application  Product range implementation and presentation of the new Hybrid Power Unit

8. Slide 8: Main highlights update - Trencher Business

   Main highlights update - Trencher Business  USA: constant increase of sales volume and expectation to continue in Q4  MENA  Destocking completed thanks to the market recovery in the Middle East area. Consequently positive impact on sales volume in Q4.  Libya: below expectations due to difficult

9. Slide 9: Subsidiaries

   Subsidiaries Tesmec RUS (100%) Tesmec USA (100%) Revenue 1 million € (-58% vs 9M13) Revenue 23,6 million € (+56% vs 9M13) Slowdown for Stringing but there are good prospects for grid efficiency. On the financial statements as at 31 December 2013 basis and of the positive performance of early 2014, t

10. Slide 10: Revenues: international scale and exposure to growing economies

    Revenues: international scale and exposure to growing economies 9M2013 9M2014 5% 14% 24% 15% 26% 17% 6% 4% 24% 12% 26% 27% Italy Europe Middle East BRICs and Oceania Africa North-Central America 10/21

11. Slide 11: 9M2014 P&L Results

    9M2014 P&L Results 1Q 2Q 3Q 9M RAILWAY 2014 2014 2014 2014 Delta % 9M 9M (9M14 Vs Revenues 1,7 4,8 4,3 10,8 GROUP 2013 2014 9M13) EBITDA 0,3 0,8 2,5 3,6 % on Revenues 18% 17% 58% 33% Revenues 85,1 81,0 -5% 1Q 2Q 3Q 9M EBITDA 15,9 12,6 -21% TRENCHER 2014 2014 2014 2014 % on Revenues 19% 16% Revenues

12. Slide 12: EBITDA 9M2014

    EBITDA 9M2014 20 15 0,2 1,3 1,2 (0,4) (4,1) (1,5) 10 15,9 12,6 5 0 EBITDA Revenues Materials Cost for Personnel Capitalized Other EBITDA 9M2013 cost Services Costs R&D Costs 9M2014 Expenses &Revenue EBITDA decrease is mainly due to change in product and 9M 9M 2013 market mix 2014 12/21

13. Slide 13: 1H2014 Financial Results

    1H2014 Financial Results Financial Information 1Q2014 1H2014 9M2014 2013 (Euro Mln) Net Working Capital 60,7 57,0 66,8 52,7 Non Current assets 58,8 58,3 63,4 57,5 Other Long Term assets/liabilities 0,2 (0,4) (1,2) 0,4 Net Invested Capital 119,7 114,9 129,0 110,6 Net Financial Indebtness 78 73,1 83,4

14. Slide 14: Working Capital Evolution

    Working Capital Evolution Days* 9M Days Euro Mln 1Q2014 1H2014 9M2014 2013 2014 2013 Trade Receivables 45,9 39,5 43,7 43,2 144 137 Inventories 49,5 59,4 63,2 48,1 208 152 Trade Payables (25,2) (30,3) (32,0) (25,5) 105 81 Other Current Assets/(Liabilities) (9,5) (11,6) (8,1) (13,1) 27 41 Net Working

15. Slide 15: Net Financial Position Evolution

    Net Financial Position Evolution Operating Net Financial Position without figurative debt 80 68,8 for Grassobbio premises 19,1 70 2 3,3 10,0 1,7 60 19,9 IAS 17 50 14,1 0,5 40 83,4 30 64,3 (16,2) 48,9 48,9 20 10 0 NFP Operating OFCF NWC Finacial Other Dividend Int.exp. Taxes Operating Capex NFP FY 20

16. Slide 16: Exchange Rate Risk exposure 9M2014

    Exchange Rate Risk exposure 9M2014 Revenues Operating Costs 3% 1% Euro 23% Euro 29% USD USD 67% 76% Other Other Cambi medi per il Cambi di fine periodo periodo chiuso al 30 settembre al 30 settembre 2014 2013 2014 2013 Dollaro USA 1,355 1,317 1,258 1,351 Trade Receivables Trade Payables 15% Euro Eur

17. Slide 17: Order Book 9M 2014

    Order Book 9M 2014 TRENCHERS STRINGING € mln 41,1 € mln 33,7 28,4 32 30 36,4 40,0 22 40 14,6 15 20 0 - 0 - Order book 9M 2014 Order Order book Order 9M2014 Order Order FY2013 Revenues Intake 9M2014 book Revenues Intake book FY 2013 9M2014 RAILWAY Backlog Trend € mln 80 15 62,1 58 69 61 22 11,9 60 52

18. Slide 18: Outlook 2014

    Outlook 2014 -> Backlog: strong increase vs prior year thanks to: - TE Brazil project; - TR Sales recovery in MENA area - TR constant performance in North America; -> Revenues: - double digit recovery in q4 vs. prior year - yr.end target expected to be higher than prior year; -> Margins: recovery in

19. Slide 19: Appendix A - Summary 9M2014 Profit & Loss statement

    Appendix A - Summary 9M2014 Profit & Loss statement Delta vs Profit & Loss Account (€ mln) 9M2014 9M2013 Delta % 2013 Net Revenues 81,0 85,1 (4,1) -5% Raw materials costs (-) (37,8) (38,2) 0,4 -1% Cost for services (-) (13,7) (15,0) 1,3 -9% Personnel Costs (-) (18,8) (17,3) (1,5) 9% Other operating

20. Slide 20: Appendix B - Summary Balance Sheet

    Appendix B - Summary Balance Sheet Balance Sheet (€ mln) 9M2014 2013 Inventory 63,2 48,1 Accounts receivable 43,7 43,2 Accounts payable (-) (32,0) (25,5) Op. working capital 74,9 65,8 Other current assets (liabilities) (8,1) (13,1) Net working capital 66,8 52,7 Tangible assets 47,5 43,2 Intangible a

21. Slide 21: Disclaimer

    Disclaimer • The Manager responsible for preparing the company’s financial reports, Andrea Bramani, declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to the document results, books and a

22. Slide 22: TESMEC S.p.A - Headquarters

    TESMEC S.p.A - Headquarters via Zanica, 17/O - 24050 Grassobbio (BG) - Italy Tel. +39.035.423 2911 - Fax +39.035.4522444 Management and Administration Fax +39.035.4522445 Stringing Equipment Division - Fax +39.035.335664 Trencher Division www.tesmec.com - info@tesmec.it

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