Slide 1: HAWK Corporation
HAWK Corporation SST ae ae McDonald & Company McDona on May 6, 2003
Slide 2: Forward Looking Statement
Forward Looking Statement ©The information provided within the presentation on the fallawing slides includes forward-looking statements relating ta Hawk Corporation's sales, operating incame, revenues fram new business, margins, end markets, segment grawth, growth drivers, and goals far 2007, Thase
Slide 3: Investment Thesis
Investment Thesis SSS a ase @ “Institutional Grade” Company @ Leading Positions in World Markets @ Excellent Growth During 1990’s ®@ Stock Currently at 50 — 60% of Book Value @ Strong Upside Operating Leverage ° ff ° 27
Slide 4: Key Investor Highlights
Key Investor Highlights @ Design, manufacture and market highly engineered products, principally made from powder metals @ Market leader in a wide variety of industrial, aerospace and consumer applications * 80% of sales derived from applications that are sole-sourced to diversified end markets with
Slide 5: SS ae ee]
SS ae ee] savy Eextpment ote Hants Com Famed a et, perospace HPC Pioneer Model TClutchDise = Case Brake Pads in PMIndustry Hawk IPO Hawk Racing Group
Slide 6: Revenue/Operating Income History
Revenue/Operating Income History din millions, GAAP) $2500 2000 1600 1000 $600 902 1999 1a 1005 1908 ma? ta08 1990 [EER evenue —e— Operating come
Slide 7: 3/31/2003 Consolidated Income
3/31/2003 Consolidated Income SS ae ae ee 313112003 313112002 Actual Actual Revenue $58,590 $49,804 Gross Profit $12,947 $10,773 Gross Profit % 22.1% 21.8% Operating Income $3,288 $1,378 Operating Income % 5.6% 2.8% Net income (loss) before change in accounting principle $119 ($600) Net income (loss
Slide 8: Consolidated Balance Sheet
Consolidated Balance Sheet SSE ea ee] Cash Total Current Assets PP&E, net Intangibles Total Assets Current Liabilities Bank Facility Long-Term Debt Equity Total Liab. & Equity 3/31/2002 3.430 80 407 66 455 43,003 195 597 39,637 28,002 69.414 45,581 195 597 1213112002 41,702 76,798 67,892 44,972 193
Slide 9: Corporate Governance
Corporate Governance San a ae ee Sarbanes-Oxley “Ready” Long-Term Independent Board of Directors Management-Shareholder Alignment Conservative Accounting Policies Established Internal Audit Function Corporate Values Integrity Customer Dedication Menittocracy Teamwork Bias for Action Enjoyment
Slide 10: Trends and Market Position
Trends and Market Position SSE a eae] e Industry Growth Trends and Positions ° Leading position in Friction technology enabling global market share opportunities *° Precision Component (PM and MIM) market growth, market consolidator and global expansion ° Trend by motor manufacturers to outsourcing
Slide 11: Business Strategies
Business Strategies « Product Innovation and R&D * Powder Metal- Technology enabling conversioneering” leading to new applications * Friction - World-class in paper, new applications Global Manufacturing Strategies « ° Follow customer relationships ° Take advantage of lower cost manufacturing locati
Slide 12: Global Presence
Global Presence Ontario, Canada | Chigisaki, Japan Orzinuovi, Italy (Licensee) 5 Suzhou, China Monterrey, Mexico
Slide 13: HAWK Profile
HAWK Profile SSE a eae] @ HAWK is comprised of four operating groups: 2002 Revenue Employees Locations * WPG $106.1M 860 USA, Canada, Italy, China, Japan * HPCG = $65.8M 550 USA, China * Motors $12.7M 225 USA, Mexico. * Racing § $12.6M 70 USA
Slide 14: HAWK Customers
HAWK Customers SSS a a] Fy Ci" CATERPILLAR (vensys Gooonch = Www @oworre yomwo GS €@ ch
Slide 15: Wellman Products Group
Wellman Products Group SST ae ae Worldwide leader providing engineered solutions for original equipment ™ manufacturers in over 50 countries. ° Brakes, clutches, and transmissions Products: Markets: * Friction Materials * Aerospace * ~Stampings * Truck * Powder Metal * Construction Parts * Agricultu
Slide 16: WPG Market Position
WPG Market Position SSE ea ee] Global Available Market = $7.5 Billion WPG Served Market = $1.0 Billion Niche Market / Size WPG Competition Trends Customers On-Hwy (170M) $17M Mba Perf. Material Eaton, Sachs, 2F Truck (6,7.8) Development Off-Hwy ($300M) $47M Raybestas,Dynax CarbonPaper Cat, Deere, Da
Slide 17: WPG Strategy/Outlook
WPG Strategy/Outlook San a ae ee 2002 2007 Goal Revenue (Projected 7.2% CAGR) $106.1M $150.0M Operating Income 7.0% 10.0% ® Continuing Share Gains (Material Performance, Customer Service) ° New Product Introductions *° Global Growth ° Aftermarket / Fleet Focus @ Improving Business Cycle
Slide 18: Hawk Precision Components
Hawk Precision Components Leading supplier of net shape precision components for industrial applications Conversioneering™ of components for: ° Pumps, motors, transmissions, brake systems, and other engineered systems Products: Markets: ° Powder Metal ° Lawn and Garden Components * Industrial * Meta
Slide 19: HPCG Market Position
HPCG Market Position Market / Size Industrial PM ($1.58) Lawn & Garden, Fluid Power, Appliance Automotive PM ($3.58) MIM 150M) Metal Injection Molding Medical, Telecom Auto, Military $i Competition Burgess Norton GKN, keystone Phillips, Thermat. AFT, Parmatech Trends Customers DensityShape MTD, Park
Slide 20: HPCG Strategy/Outlook
HPCG Strategy/Outlook 2002 2007 Goal Revenue (Projected 13.7% CAGR) $65.8M $125.0M Operating Income 6.2% 11.0% Conversions to PM and MIM HPGG Technical Differentiation Market Improvements International Expansion « @€ € €
Slide 21: Hawk Racing
Hawk Racing SST a ae] Manufacturer of high performance AWW brake, clutch and drive train RAGING GHoUF nee applications fe ° Gears, bearings, driveshafts, belfhousings and starters Products: Markets: * Gear boxes * Motor sport Pa] * Brakes * Performance Auto ae * Clutches ° Fleet
Slide 22: Hawk Motors
Hawk Motors Designs and manufactures die-cast —eers aluminum rotors for: ° Smail electric motors used in appliances, business equipment ° Motors — manufacturing in Mexico and elsewhere Products: Markets: * Rotors & shafts ° Appliances * Motors * Business Equip. * Generators ° Power * Services
Slide 23: Motors/Racing Market Position
Motors/Racing Market Position San aaa ee Market / Size Hawk Competition Trends Customers Rotors ($200M) Racing ($100M) Transmissions Clutches $13M In-House Production Outsource, $13M Tilton, AP Racing Asia Niche Products Emerson, Fasco, Jakel NASCAR Racing Team, Performance Automotive
Slide 24: Motors/Racing Segments Strategy/Outlook
Motors/Racing Segments Strategy/Outlook 2002 2007 Goal Revenue (Projected 15.0% CAGR) $25.4M $51.0M Operating Income (7.1%) 7.0% Motor Outsourcing Trend Operational Focus in Mexico Continued Growth in Racing Market New Product Introductions - Racing « @€ € €
Slide 25: Hawk Corp Outlook
Hawk Corp Outlook 2002 2007 Goal Revenue $197.3M $327.0M Operating Income 5.0% 10.0% Focused Management Team with Clear Strategies Well Positioned in Industry Niches Strong R&D efforts * Continued New Product Introductions ° Development of New Materials Long Term Growth Goals * Revenue — 10.6% Annua