Schaeffler Capital Market Presentation
"Mobility for tomorrow"
December 2014 Disclaimer
This presentation contains forward-looking statements. The words "anticipate", "assume", "believe", "estimate", "expect", "intend", "may", "plan", "project", "should" and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that are not historical facts; they include statements about Schaeffler Group's beliefs and expectations and the assumptions underlying them. These statements are based on plans, estimates and projections as they are currently available to the management of Schaeffler AG. Forward-looking statements therefore speak only as of the date they are made, and Schaeffler Group undertakes no obligation to update any of them in light of new information or future events. By their very nature, forward-looking statements involve risks and uncertainties. These statements are based on Schaeffler AG management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Actual results may differ from those set forth in the forward- looking statements as a result of various factors (including, but not limited to, future global economic conditions, changed market conditions affecting the automotive industry, intense competition in the markets in which we operate and costs of compliance with applicable laws, regulations and standards, diverse political, legal, economic and other conditions affecting our markets, and other factors beyond our control). This presentation is intended to provide a general overview of Schaeffler Group’s business and does not purport to deal with all aspects and details regarding Schaeffler Group. Accordingly, neither Schaeffler Group nor any of its directors, officers, employees or advisers nor any other person makes any representation or warranty, express or implied, as to, and accordingly no reliance should be placed on, the accuracy or completeness of the information contained in the presentation or of the views given or implied. Neither Schaeffler Group nor any of its directors, officers, employees or advisors nor any other person shall have any liability whatsoever for any errors or omissions or any loss howsoever arising, directly or indirectly, from any use of this information or its contents or otherwise arising in connection therewith. The material contained in this presentation reflects current legislation and the business and financial affairs of Schaeffler Group which are subject to change and audit.
Page 2 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance Schaeffler – A leading technology provider
NumberSchaeffler of Grouppatent atregistrations a glance in Germany1) StrongNumber sales of patent growth registrations from 2009 in- 2013Germany1) in EUR bn 4 Leading manufacturer of high-precision components CAGR +11% and systems for automotive and industrial applications 10.7 11.1 11.2 9.5 4 Global footprint with approx. 79,000 employees in more than 50 countries 7.3 4 Above industry average profitability and revenue growth
4 Strategic participation in Continental AG 2009 2010 2011 2012 2013 inSales EUR by mn segment Sales by region
Industrial Americas 21% 27%
11% 73% Greater China Automotive 58% Europe¹) 10% Asia/Pacific
1) Incl. Germany, Western, Southern and Eastern Europe, Middle East, Africa, Russia and India
Page 3 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance A strong history of above average growth
Development of sales 2004 - 20131) EBIT and EBITDA 2004 - 20131) in EUR bn in EUR bn
11.1 11.2 2.2 CAGR +5% 10.7 2.1 2.1 2.0 9.5 9.0 8.9 1.7 1.7 1.7 8.3 7.9 1.5 7.3 7.3 1.4
1.1
1.7 1.5 1.4 1.4 1.0 1.1 1.1 1.0 0.8 0.7
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2004 2005 2006 2007 2008 2009 2010 2011 2012 20132)
EBITDA margin Sales growth 19.0% 19.5% 19.9% 19.4% 19.4% 15.0% 22.1% 21.0% 18.8% 18.4% EBIT margin 7.2% 8.7% 4.7% 8.4% -1.2% -17.6% 29.4% 12.6% 4.0% 0.9% 10.8% 12.2% 12.9% 12.6% 11.7% 6.1% 15.9% 15.8% 12.7% 12.6%
EBIT EBITDA
1) 2004-2005 according to German GAAP, 2006-2013 according to IFRS 2) Adjusted EBIT and EBITDA
Page 4 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance Two divisions with top three positions in core market sectors
Automotive Industrial
Transmission Systems Engine Systems Production Machinery Aerospace
Chassis Systems Energy and Raw Material Mobility
Aftermarket Aftermarket
Page 5 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance Automotive – Broad mix of components and systems
Page 6 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance Industrial – Competence in bearings
The Industrial division delivers solutions and services with around 225,000 products for more than 40,000 customers in over 60 sectors worldwide
Rotary table Linear guidance INA/FAG catalog with 40,000 items bearings with measuring systems Ball system roller bearings Cylindrical Spherical roller plain bearings bearings Radial with insert disc cage ball Cage-guided bearings cylindrical cylindrical Yoke roller type and bearings stud type track Direct Engine Main Axial/radial roller rollers Housings drives bearings spindle bearings Spherical bearings with an outside Needle roller diameter of up to roller bearings 4250 mm Tapered bearings (up to 12000 mm roller available on bearings special request) Smallest ball bearing with a 1 mm inside diameter
Page 7 · Schaeffler Group · Capital Market Presentation · December 2014 1 Schaeffler at a glance Our key success factors – Quality, Technology and Innovation
Number of patent registrations in Germany1) Core technologies
2,100
1,832 1,854 1,641
1,146
826 … basic materials (steel) … inhouse tool design
2008 2009 2010 2011 2012 2013
Rank in Germany
#5 #5 #4 #4 #4 #2 … precision … surface treatment 1) Source: Deutsches Patent- und Markenamt (DPMA) manufacturing
Page 8 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow Strategy refocused – "Mobility for tomorrow"
Environmentally friendly drives 1 2 Urban mobility
"Mobility for
tomorrow"
Interurban mobility 3 4 Energy chain
Page 9 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Environmentally friendly drives
Reduced losses
Efficiency for Increased variability environmental friendly drives
Electrification
Page 10 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Combustion engine remains dominant but will be further electrified
Powertrain concepts CO2 legislation worldwide
●LightTrends vehicle production Light vehicles in g CO2 2% 1% Proposed target 260 Enacted target 9% USA: incl. light duty vehicles 19% 240
35% 220
200
98% 180 80% 160 56% China: 117 g USA: 109 g in 2020 in 2025 140
120 Japan: 105 g in 2020 2013 2020 2030 100 EU: 95 g in 2020 Combustion engine Hybrids Electric 80 2000 2005 2010 2015 2020 2025
Source: University of Duisburg-Essen, 2012 Source: icct, 2013
Page 11 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Possible approaches to reduce the fleet-CO2-emissions
Three approaches
1. Optimization 2. Downsizing / 3. Hybridization/ conventional Downspeeding Electrification powertrain Example: Example: New Mercedes-Benz S-class Toyota Prius – most successful with 4 cylinders hybrid on the market + +
Threefold approach
Page 12 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Market specific concepts to fulfill regional requirements
Fiesta eWheelDrive Schaeffler Fiesta eWheelDrive Schaeffler CO ncept-10% Schaeffler 2 Hybrid Schaeffler CO ncept-10% Hybrid 2
Schaeffler ACTIVeDRIVESchaeffler ChinaChina ACTIVeDRIVE ConceptConcept Car Car
Gasoline Technology Car 1. Gasoline Diesel TechnologyEco Car Schaeffler Efficient Drive2. Diesel Eco Drive FutureSchaeffler Mobility Efficient North 3. 48V Democar AmericaFuture Mobility North America System 48V Schaeffler Efficient Schaeffler Efficient Future Mobility India Future Mobility India
Page 13 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Meeting stringent US emission targets of 2020 already today
Efficient Future Mobility – Fuel reduction in % Schaeffler North America Demonstration Vehicle Technology City Highway Belt Drive Friction 1.0 1.0 Optimization Valve Train Friction 0.5 0.5 Optimization Balance Shaft 0.6 1.0 Bearings Thermal Management 1.0 1.0 Module Adaptive Grill 0.2 0.8 Shutters Engine Start-Stop 6.0 2.0 § Developed in North America for market-specific AWD Disconnect 2.0 6.0 demands and customer requirements Wheel Bearings 0.5 1.0 § Schaeffler shows solutions for optimizing North Optimization American combustion engines and drive trains TC with Centrifugal § Additional fuel savings potential up to 15% Pendulum-type 3.0 1.0 Absorber Total: ~15 ~14
Page 14 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 1 Latest concept car shows further fuel saving potential
Gasoline Technology Car Fuel reduction in % (simulation according to NEDC)
Measure Reduction Start/stop 20 km/h 1.1 Recuperation 2.6 Torque repartition 0.8 Dedicated braking pedal 0.5 Free gear selection 5.4 External exhaust gas recirculation (EGR) 2.0 Electric heatable catalyst 2.0 Thermal management module (real simulation) 1.0 Total ~15 § Ford Focus, 1.0l 3-cylinder, turbo charger, 92 kW, 114 g/km Total incl. synergies between measures ~17 CO2, Start/Stop, EU5 § Mild Hybridization 48V BSA, thermal management module, coated tappets, decoupling belt tensioner, optimized turbo Emission reduction charger, engine control unit, injection system, heated catalyst, low-pressure EGR, hydr. clutch actuator, DMF with centrifugal pendulum absorber In addition to fuel savings, emission reduction § Fuel savings potential ~15% (aim ~17%: 95 g/km) and (NMHC, NOx, CO, PM) was achieved to comply with emission reduction EU6c the guideline EU6c.
Page 15 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 2 Urban Mobility
Today: 2025: 7.1 bn people 8.0 bn people 50% in metropolitan regions 60% in metropolitan regions
Page 16 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 2 Strong market development LEVs and e-bikes
LEVs volume per application worldwide Forecast sales E-Bikes
Units in mn. Units in mn. Golf cars 9,E+0790 50 RestRestl. of Welt world Micro EV quadricycle WesternWesteuropa Europe LEvs for disabled 8,E+0780 40 China E-Scooter /e-MC 7,E+0770 E-bike /Pedelec 30
6,E+0760 20 5,E+0750 10 4,E+0740
0 3,E+0730 2012 2013 2014 2015 2016 2017 2018 Source: Pike Research 2012 2,E+0720 § By 2018, the E-bike market is growing globally at an 1,E+0710 annual rate of 7.4%.
0,E+000 § 2018, the annual sales will be at 47 mn., with almost 95% of the market in China. § Majority of E-bikes in China without pedals, in Western Europe almost exclusively Pedelecs. Source: Light Electric Vehicles, Mobility Vehicles, E-Motorcycles and Micro-Evs (Quadricycles) 2013-2023, IDTechEx 2013
Page 17 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 2 Offering solutions for urban mobility requirements
Strong focus on electric mobility in China E-wheel drive
E-bikes and e-scooters Schaeffler innovation Electric motor, power electronics, brake, and cooling § Openness towards new system are installed inside the wheel rim technologies § Increasing income § Pursuit of individual mobility § Around 20-30 million e-bikes and e-scooters are sold each year in China
Schaeffler employees in China using e-bikes and e-scooters
Concept vehicle Ford Fiesta eWheelDrive New Energy Vehicles (NEVs)
§ NEVs are defined as fully electric or hybrid Driving systems especially for vehicles on four wheels urban use § Subsidies for Battery Electric Vehicles (150 km § Space-saving vehicle concept range) and Hybrid Electric Vehicles (50 km range) § Increased maneuverability § Minimum speed requirement: 100 km/h and safety
Page 18 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 3 Interurban Mobility
CO2 emissions of road freight transport 100% per tone-kilometer 80% (1991 = 100 %)
60%
40%
20%
1991 2004 2025 0% Source: UBA, IFEU
Page 19 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 3 Key technology partner for high speed trains
Mechatronic systems for freight traffic Schaeffler test rig
Generator Rolling bearing unit
Electronics module
Schaeffler test rig for railway axlebox bearings, Schweinfurt, DE and Anting, CN
§ FAG axlebox bearing for high-speed trains § Key influencing factors § Mechatronic functions in axlebox bearings can be tested in advance. § The integrated wheelset generator allows energy for § Different route profiles freight transport to be supplied and includes a monitoring can be simulated under system for freight trains field conditions.
Page 20 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 3 High precision components for the aerospace industry
Schaeffler aerospace solutions Technology development
Materials
Surface
Micro Structure Bearing Analysis
§ Materials and heat treatment technologies § Surface Engineering § Non-destructive test methods for new materials § Development of coatings § Design Integration Main shaft and § Advanced Cooling Concepts gearbox bearings, e.g. for Airbus A380 § Dynamic analysis & Simulation § Bearing rig testing § Condition Monitoring (“Intelligent Bearing”)
Page 21 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 4 Energy chain
GlobalSolar- investments und Windenergie in new power plants and infrastructure 2011-2020
Other Regenerative 4% Solar PV 7%
Power grids 44% Water 8% (Infrastructure)
Wind 12%
Nuclear 6%
Oil 1% Gas 6% Coal12%
Source: International Energy Agency (2011): World Energy Outlook
Page 22 · Schaeffler Group · Capital Market Presentation · December 2014 2 Mobility for tomorrow 4 Innovative solutions for regenerative energies
Wave power Wind power
Schaeffler uses a special steel that is resistant to corrosion for the rolling bearing rings. Large-size bearing test rig in Schweinfurt, Germany
For ocean current power plants, Schaeffler develops bearing supports that can be directly installed in water. The water is the medium that provides the Schaeffler's spherical roller bearing "X-life" is the classic lubrication. bearing variant for the rotor main shaft in wind turbines.
Page 23 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Overview results 9M 2014
9M 14 Q3 14 9M 14 9M 13 Q3 14 Q3 13 in EUR mn vs. 9M 13 vs. Q3 13 Sales 9,024 8,425 +7,1% 3,034 2,811 +7.9%
EBITDA 1,688 1,514 +11.5% 589 472 +24.8%
EBITDA margin 18.7 18.0 +0.7%pts. 19.4 16.8 +2.6%pts.
EBIT 1,215 1,038 +17.1% 428 314 +36.3%
EBIT margin 13.5 12.3 +1.2%pts. 14.1 11.2 +2.9%pts
Net income 936 1,020 -84 mn 362 459 -97 mn
Working capital1) 2,906 2,343 +563 mn 2,906 2,343 +563 mn
Capex 500 343 +157 mn 202 114 +88 mn
Free cash flow2) 103 589 -486 mn 282 203 +79 mn
Net debt1) 6,306 5,890 +416 mn 6,306 5,890 +416 mn
Leverage ratio1) 3) 2.6 2.6 - 2.6 2.6 -
1) Prior year figure as per December 31, 2013 2) Excluding one-off effects of EUR 529 mn, FCF is EUR 632 mn 3) Net financial debt excl. shareholder loans to adjusted EBITDA ratio
Page 24 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Sales above EUR 9 bn in 9M 2014
Sales 9M 2014 sales by region1) in EUR mn in EUR mn / Y-o-y growth Asia/Pacific 896 / +8.9% +7.1%1) vs. 9M 2013 9.9% 2,976 3,014 3,034 Greater China 2,756 2,858 2,811 2,780 1,076 / +24.5% 11.9%
57.8% 20.4% Americas Europe 1,839 / +3.4% 5,213 / +5.1% 8,425 9,024
11,205 1) Market view (= location of customers) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Sales by division 2013 2014 in EUR mn D excl. 9M 14 9M 13 D FX effects Gross profit margin in %
28.7 28.8 27.2 28.7 29.1 28.1 29.3 Automotive 6,667 6,129 +8.8% 10.5%
28.3 28.9 Industrial 2,357 2,296 +2.7% 4.9% Total 9,024 8,425 +7.1% 9.0% 1) Includes negative FX effects of 1.9%
Page 25 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Sales Automotive – Continued growth above market
Sales development Automotive1) Regional distribution
Europe Americas2) Asia/Pacific
+14% Greater China 12% +8% 10% +4% +1% 57% Europe Americas 21%
World production: +4% Schaeffler Automotive OEM: +12% (operational sales growth) Asia/Pacific Greater China Key aspects +32% § Schaeffler Automotive again strongly outgrew global +11% automotive production in 9M 2014
+10% § All business divisions and all regions contributed to +2% overall growth
§ Strong growth in China especially in BD Trans- mission Systems (e.g. double clutch systems) Production of light vehicles Operational sales growth 9M 2014 vs 9M 2013 Schaeffler Automotive (OEM) § Nearly full utilization of current production capacity (IHS Automotive) 9M 2014 vs 9M 2013 (by location of customer) in the first nine months 2014
1) Schaeffler Automotive sales growth by region is not necessarily an indication of actual end-customer demand by region (e.g. European sales include components and systems sold to customers in Europe who ultimately export the final product to customer locations in North and South America as well as in Asia/Pacific). 2) Operational sales growth Schaeffler Automotive (OEM) in North America +22% (light vehicles production +6%) and in South America -17% (light vehicle production -17%) Page 26 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Sales Industrial – Positive trend continues
Sales trend Regional distribution 908 Asia/Pacific 870 839 Greater China 804 10% 789 789 770 764 12% 769 757 745
19% 59% Europe Americas
2012 2013 2014
Key aspects Sales 9M 2014 vs. 9M 2013 § Sales Industrial with improving trend; FX-adjusted growth rate +4.9% (as reported 2.7%)
in EUR mn 9M 2014 9M 2013 D § Order intake shows significantly positive trend, Industrial Applications orders on hand exceed prior-year level 1,463 1,445 +1.2% Industrial Aftermarket § Strong sales increase in Greater China across all 894 851 +5.1%
sectors except Aerospace and Heavy Industries Total 2,357 2,296 +2.7% § Revenues in Asia / Pacific and Europe above prior year level, revenues in the Americas region impacted by currency translation
Page 27 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 EBIT margin at 13.5% – Earnings quality above target range
EBIT ∆ EBIT in EUR mn in EUR mn 599
1 11 1,215 2 1,217 -372 1,038 -25 -37 +17.1% vs. 9M 2013
414 428 384 355 369 362 9 324 11 48 405 373 314 380 EBIT Sales COGS R&D Sales Admin Others EBIT One-off Adj. 1,038 9M 13 9M 14 effects1) EBIT 9M 14 1,215 Margin in % 982 12.3 13.5 13.5 -56 Q1 Q2 Q3 Q4 Q1 Q2 Q3 EBIT per division in EUR mn 9M 14 9M 13 9M 14 2013 2014 D EBIT EBIT margin
Adjusted EBIT margin in % Automotive 932 800 +16.5% 14.0%
12.9 12.9 12.9 11.7 13.6 12.7 14.1 Industrial 283 238 +18.9% 12.0%
12.9 13.5 Total 1,215 1,038 +17.1% 13.5%
1) Positive one-off effect from the release of provision for antitrust fine in Q1 2014 (EUR 9 mn) and negative one-off effect from compensation payments in Q2 (EUR 11 mn)
Page 28 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Net income EUR 936 mn
Net income 9M 20141) Net income1) in EUR mn in EUR mn
9,024
1,215 +548 936 -7,809 459 -196 382 362 328 233 -631 192 1 2 865 936
Sales Costs EBIT Financial Investment Taxes/ Net result result minorities income -155
Q1 Q2 Q3 Q4 Q1 Q2 Q3
2013 2014
1) Net income attributable to the shareholders of the parent company
Page 29 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Free cash flow 9M 2014 of EUR 103 mn impacted by Q2 one-off effects
Free cash flow Free cash flow 9M 2014 in EUR mn in EUR mn
1,688
424
334 529 282 One-off 500 effects 203 168 227
1581) 52 40 103 Refinancing 386 371
-19 103 Anti- 155 trust 82 fine -160 EBITDA Δ Net Capex Interest Taxes Other Free Divi- Q1 Q2 Q3 Q4 Q1 Q2 Q3 working payments cash dend capital flow from 2013 2014 Conti- nental
Q3 2014
589 -41 -202 - -68 - - -13 17 282
1) Q2 2014: Prepayment fee EUR 114 mn + accrued interest EUR 29 mn + transaction cost EUR 15 mn
Page 30 · Schaeffler Group · Capital Market Presentation · December 2014 3 Results 9M 2014 Leverage ratio at 2.6x
Net financial debt Development leverage ratio in EUR mn in EUR mn 12/31/13 09/30/14
Gross debt 6,190 6,981 6,834 6,475 6,172 6,362 6,306 - Cash 300 675 5,729 5,890 = Net financial debt 5,890 6,306
- Shareholder loans 443 537 3.3 3.1 = Net financial debt 2.7 2.7 2.6 5,447 5,769 2.6 2.6 (w/o shareholder loans)
÷ LTM EBITDA adjusted 2,062 2,190
= Leverage ratio 2.6 2.6
645 607 301 343 284 443 537 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Maturity profile (after October 2014 refinancing) 2013 2014 in EUR mn1) 1,766 Gross debt 1,269 1,212 7,292 7,037 6,089 6,190 6,395 6,833 6,981 1,000
Cash position 600 500 458 562 360 300 223 471 675
Shareholder Loans 2014 2015 2016 2017 2018 2019 2020 2021 2022 Leverage ratio (Net financial debt w/o shareholder loans / LTM Adjusted EBITDA) Existing bonds New loans
1) Assuming EUR/USD=1.28 as of October 16, 2014
Page 31 · Schaeffler Group · Capital Market Presentation · December 2014 4 Financing and corporate structure Financing structure continuously improved
Key development steps
January Comprehensive refinancing of OpCo indebtedness of €8.0 bn including 2012 first-time issuance of high-yield bonds Financing June / July Bank consortium further enhanced, issuance of €326 mn retail bond 2012 structure September Reduction of liabilities at Schaeffler Holding by €1.6 bn, shareholder OpCo/HoldCo 2012 structure simplified
December Refinancing of €5.6 bn OpCo facilities enhancing covenant, repayment and 2012 structural flexibility
February Repricing transaction of €1.6 bn equivalent OpCo facilities with 2013 institutional lenders Continuous capital April Restructuring of OpCo facilities and additional issuance of €1.25 bn 2013 high-yield bonds structure July Comprehensive refinancing of HoldCo indebtedness of €3.75 bn including issuance optimization 2013 of PIK Toggle Notes
September Reduction of liabilities at Schaeffler Group and Schaeffler Holding by 2013 approx. €1.3 bn
May Refinancing of €3.5 bn OpCo debt by placing €2.0 bn of new secured and unsecured 2014 bonds and €1.5 bn of new institutional term loans
October €1.8 bn equivalent OpCo loan refinancing and OpCo/HoldCo bond consent process Corporate 2014 completed to align terms and conditions; €1.0 bn OpCo RCF committed structure October Refinancing of €1.9 bn of HoldCo debt with €700 mn HoldCo bank loans Schaeffler Group 2014 and €1.2 bn HoldCo bonds
Page 32 · Schaeffler Group · Capital Market Presentation · December 2014 4 Financing and corporate structure Corporate structure before and after latest refinancing transaction
Previous corporate structure Current corporate structure
TopCo INA-Holding Schaeffler TopCo INA-Holding Schaeffler GmbH & Co. KG GmbH & Co. KG 100% 100% Schaeffler Holding Schaeffler Holding GmbH & Co. KG GmbH & Co. KG 100% 100% HoldCo HoldCo HoldCo Schaeffler HoldCo Schaeffler Verwaltungs Verwaltungs Loans GmbH Loans GmbH
HoldCo Schaeffler 100% HoldCo Schaeffler 100% Holding Holding Bonds Finance B.V. 100% Bonds Finance B.V. 100%
OpCo SVZ (formerly Schaeffler AG1) Schaeffler AG)4)
Guarantee Guarantee 100% 100% 100% Schaeffler Free 100% Schaeffler Free Beteiligungs- float Beteiligungs- float holding2) 11.8% holding4) 11.8% 54.0% 54.0% 34.2% 34.2% OpCo OpCo INA OpCo Schaeffler AG Beteiligungs Continental AG Continental AG Loans GmbH (“IBH”)3) Loans (formerly IBH)
Schaeffler OpCo Schaeffler OpCo Schaeffler Schaeffler Technologies Finance B.V. Technologies Finance B.V. Bonds GmbH & Co. KG Bonds GmbH & Co. KG
1) Schaeffler AG was converted into a GmbH and renamed Schaeffler Verwaltungs Zwei GmbH 4) Schaeffler Beteiligungsholding guarantee and SVZ (formerly Schaeffler AG) guarantee will 2) Schaeffler Beteiligungsholding has also issued a guarantee in favor of all OpCo loans/bonds remain in place until fall-away conditions have been met (SVZ guarantee for benefit of 3) IBH GmbH was converted into an AG and renamed Schaeffler AG OpCo debt to fall-away upon consent by or refinancing of 2017 OpCo Notes) Page 33 · Schaeffler Group · Capital Market Presentation · December 2014 4 Financing and corporate structure Key investment highlights
1 Leading positions in growing markets
2 Quality, technology and innovation leadership
3 Shaping "Mobility for tomorrow" by focusing on four key areas
4 Strong profitable growth and sustainable cash flow generation
5 Continuous optimization of balance sheet
Page 34 · Schaeffler Group · Capital Market Presentation · December 2014 5 Outlook Guidance 2014 unchanged
Growth Profitability
Sales growth >7%1) EBIT margin 12-13%
Capex 6-8% of sales Free cash flow Positive
1) FX adjusted
Quality Innovation
Quality policy Further improve R&D expenses 5% of sales
Maintain leading Employees ~ 3,000 new jobs Innovation position in patent applications
Page 35 · Schaeffler Group · Capital Market Presentation · December 2014 Schaeffler IR contact
Investor Relations Financial calendar 2014
phone: + 49 9132 82 4440 Results FY 2014 March 26, 2015 fax: + 49 9132 82 4444 Results Q1 2014 May 21, 2015 [email protected] www.schaeffler-group.com/ir
Page 36 · Schaeffler Group · Capital Market Presentation · December 2014