Results Q1 2018

RESULTS Q1 2018

Wielton Group

Wieluń 22.05.2018 Leading

European player

• Manufacturer of semi-trailers, trailers and car bodies for road transport and agriculture

• One of the youngest and most dynamic 3rd MOSKWA companies in the industry - 22 years old in Europe • Multibrand - A group based on strong MIŃSK local brands

WALTROP WIELUŃ • Own, modern R&D facilities – only R&D KIJÓW Centre in Poland, second in Europe

AUXERRE 10th • Extensive product portfolio - 11 groups • International service network - over 600 in the world PESCARA service points

• Experienced crew - 2,600 people in the Group, 260 engineers ABIDŻAN PRODUCTION CENTRES ASSEMBLY PLANTS TRADE COMPANIES Key data for Q1 2018

• In Q1 2018, sales revenues were close to PLN 0.5 billion (an increase of almost 30% y/y; Q1 2017 Q1 2018 the consolidation of Langendorf brought over PLN 65 million).

Volume 3 650 ea. + 20,2 % 4 386 ea. • The EBITDA margin amounted to PLN 33.3 Revenues 380.1 M PLNł + 26,3 % 479,9 M PLN million - compared to Q1 2017 it was higher by

EBITDA 28,3 M PLN + 17,7 % 33.3 M PLN nearly 18%. • EBIT exceeding 5.3% (5.7% a year earlier) EBITDA margin 7.4 % - 0,5 pp 6.9 % with a profit of over PLN 25 million - nearly EBIT 21.7 M PLN + 18,0 % 25.6 M PLN PLN 4 million more than the previous year.

EBIT margin 5.7 % - 0,4 pp 5.3 % • Net profit amounted to PLN 20.2 million (a year earlier it was PLN 16.4 million), including PLN 2.9 16.4 + 23,2 % 20.2 Net profit M PLN M PLN million due to the asset from the investment bonus. Net margin 4.3 % - 0,1 pp 4.2 % • The achieved net profit was record-breaking, in terms of Q1.

Sales and revenues

Structure [%]

31,5% 68,5% • In the first quarter of 2018, the Wielton Group +20.2% 4 386 3 650 sold 4,386 road trailers and semi-trailers as PL 3.3% EX

+14.9% 1 381 well as agricultural products, an increase of

] PL 1 202 20.2% y/y. 6.7%

+22.8% Sales Sales [units EX 2 448 3 005 • Foreign sales in the Wielton Group in Q1 2018 accounted for nearly 70% of the total volume. 1Q 2017 1Q 2018 • The increase in the volume of foreign sales Q1 2017 by 22.8% y/y to 3,005 units was the result of a Q1 2018 very good economic situation in Russia, as well

479,9 as in Germany. +26,3% 27,8% 72,2% 380,1 133,2 • Exports accounted for over 72% of sales +10.2% PL 31,8% EX PL 120,9 revenues, which is an increase of 4 percentage

Sales Sales 259,2 +33.8% 346,7 points compared to the previous year

revenues revenues EX 68,2% (in PLN millions) PLN (in 1Q 2017 1Q 2018 Market share and sales Poland Product sales headquarters: Sales [units] revenues Wieluń, Poland [in PLN mln]

+14,9% 1 381 1 202 115,1 +8,8% 125,2

Market share - Q1 2017 Q1 2018 Q1 2017 Q1 2018 based on vehicle registrations

Q1 2018 15,2% • After the first quarter of 2018, the market increased by 9.2% y/y to 6,875 registered vehicles at that time. Q1 2017 16,9% • Increased sales of high volume combinations contributed to reducing market shares, Market size as well as the average price of sales products. Q1 2018 6 875 • Domestic sales amounted to 1,381 units (including AGRO products) - and were higher 3rd by 14.9% compared to the same period last year. position • After the first quarter of 2018, revenues from sales of products on the domestic market increased by 8.8% y/y, reaching PLN 125.2 million.

Market share and sales France Product sales Headquarters: Sales [units] revenues Auxerre, France [in PLN mln]

1 463 -5,5% 1 382 168,9 -6,6% 157,8

Market share - Q1 2017 Q1 2018 Q1 2017 Q1 2018 based on vehicle registrations

Q1 2018 18,6% • In the first quarter of 2018, the French market increased by 12% y/y Q1 2017 22,0% to 7,137 vehicles.

Market size • Fruehauf SAS makes full use of the available production capacities, Q1 2018 which are temporarily limited due to the current investment in a robotic 7 137 1st chassis production line. position • Fruehauf SAS has a portfolio of orders up to 2019.

Investments – Fruehauf Market share and sales Italy Product sales Headquarters: Sales [units] revenues Pescara, Italy [in PLN mln]

223 -17,0% 185

20,3 -9,9% 18,3

Market share - Q1 2017 Q1 2018 Q1 2017 Q1 2018 based on vehicle registrations

Q1 2018 4,3%

Q1 2017 4,7% • After the first quarter of 2018, the Italian market grew by 13.9% y/y, reaching 4,990 vehicles registered at that time. Market size Q1 2018 • Viberti recorded a drop in sales due to the shifting of available 4 990 5th production slots to other markets that are currently experiencing position record highs, e.g. Russia or Poland Market share and sales Russia Product sales Headquarters: Sales [units] revenues [in PLN mln] Moscow, Russia

458 +36,3% 40,4 336 +39,3%

29,0

Market share - Q1 2017 Q1 2018 Q1 2017 Q1 2018 based on vehicle registrations

Q1 2018 3,8% • The continuing favourable situation on the Russian market translated into increased sales of all products – total sales in the first quarter of 2018 amounted to 458 units. Q1 2017 3,5% • This is 36.3% more compared to the same period last year when 336 units were sold, Market size and resulted in increasing revenues by 39.3% to over PLN 40 million. Q1 2018 6 322 4th • The sale of tipper bodies is not included in the registration statistics (229 items) because these products were sold to truck manufacturers (mainly Scania, Volvo,

position and MAN). *Udział w rynku producentów europejskich producentów rynku w *Udział Market share and sales Germany Product sales Headquarters: Sales [units] revenues Waltrop, Germany [in PLN mln] 348 +954,5% 65,6 +2 329,6%

33 2,7

Q1 2017 Q1 2018 Q1 2017 Q1 2018 Market share - based on vehicle registrations

Q1 2018 1,6% • In the first quarter of 2018, the consolidated sales of Wielton GmbH and Langendorf amounted to 348 units, and the revenues of the companies reached PLN 65.6 million.

Market size • This amount includes the sales of Wielton GmbH (64 units) and Langendorf (284 units) Q1 2018 in the period of January-March 2018. 13 699 • The market size was 13,699 units, and the market share of the Wielton Group was 1.6%. Structure of product portfolio

Q1 2018 Q1 2018 Q1 2018 Q1 2018 • 11 product families 34% 21% 12% 10% over 800 configurations • One of the widest product ranges among UNIVERSAL TIPPER COSED-BOX HIGH VOLUME European producers SEMI-TRAILERS SEMI-TRAILERS SEMI-TRAILERS COMBINATIONS • Close cooperation with customers and suppliers to fully match products to the needs of the recipient

1Q 2018 1Q 2018 1Q 2018 1Q 2018 1Q 2018 6% 5% 5% 5% 2%

CONTAINER TIPPER TRAILERS AGRO TRAILERS INLOADERS New product group of (including low loader SEMI-TRAILERS Langendorf vehicles and othera) Backlog

Backlog

WSA order portfolio for 31.03.2018 • portfolio of signed orders that are waiting to be produced and delivered to the customer • determines perspective contract sales Backlog = 15 weeks in the reporting period

4125 open orders 15 weeks = • provides a level of security for planning 267 weekly capacity production work

Backlog

Germany 540 Wielton S.A. – 15 weeks France 2892 Fruehauf – 24 weeks

Langendorf – 24 weeks Poland 4 125

1Q 2018 Consolidated Profits and Margins

• Gross margin close to 14% (a year earlier EBITDA EBIT Net profit it was 13.3%) with a nominal value of PLN [PLN m] [PLN m] [PLN m] 67 million, more than 32% higher than a year earlier.

• EBITDA higher by 17% higher y/y includes 33,3 the Langendorf result of PLN 4.1 million. 25,6 28,3 +17,7% +8,0% 20,2 21,7 +18,0% +23,2% 16,4 • EBIT increased nominally by PLN 3.9 million, of which PLN 3.3 million was the 7,4% -0,5 pp 6,9% 5,7% -1,3-0,4 pp pp 5,3% 4,3% -0,1 pp 4,2% result of Langendorf. • Net profit of PLN 20.2 million, including 1Q 2017 1Q 2018 1Q 2017 1Q 2018 1Q 2017 1Q 2018 PLN 0.4 million attributable to the minority shareholder Langendorf. EBITDA result structure [PLN m]

+ 16,2 - 7,7 + 1,2 - 5,4 + 0,7 33,3 28,3

EBITDA 1Q 2017 Increased gross profit on sales Increased sales costs Increased general management Increased depreciation Changes in other revenues and EBITDA 1Q 2018 costs operational costs Summary of consolidated cash flow [PLN m]

Operations Investments Finances Total flow Cash at the end of the period

69,9 74,9

40,4 25,7 22,6 17,2 22,3

1Q 2017 1Q 2018 -12,2 -14,1 -5,8

The Group maintains a strong financial position, which is confirmed by the high level of cash at the end of the period - in y/y terms it is an increase of 7.2% Balance sheet breakdown and debts [PLN m] Adequacy of resources and proper structure of financing sources

• The balance sheet total exceeded PLN 1 billion (a year earlier it was PLN 852 million, Langendorf contributed PLN 100 million to the balance sheet total).

1080.6 1080.6 • Nearly 38% are fixed assets, and 31% of finance sources are equity capital.

• Equity capital covers 81% of fixed assets (112% a year earlier). The decrease is the result of 551,0 Short-term debt acquisitions (Langendorf 80% + Fruehauf 35%), Current assets 671,1 with the increase in fixed assets by over PLN 90 million (including tangible fixed assets by PLN 80 76,2 Including credits, loans and leasing million). including cash and cash equivalents 74,9 196,5 Long-term debt • Fixed capital with a 30% surplus covers fixed assets while maintaining long-term certainty of 152,5 Including credits, loans and leasing financing. Fixed 409,5 • In the Group's debt structure, over 26% are long- assets 333,1 Equity capital term liabilities, and fixed capital accounts for almost 50% of total liabilities.

AssetsAktywa LiabilitiesPasywa • Cash assets on the balance sheet date were close to PLN 75 million, and the liquidity ratio Net debt exceeded 1.2 (a year earlier close to 1.4, current 153.8 liabilities increased by nearly PLN 140 million, and current assets by PLN 100 million). Quick liquidity Net debt/EBITDA of 0.7 (a year earlier 0.8) indicates maintaining the 1.27 right state of current assets. 2020 Strategic Objectives

2020 Strategic Objectives Current status of strategy implementation vs. 2016

Volume Consistent implementation of strategic projects 25,000 units. x2 As of today, 16 strategic projects have been implemented Revenues and 33 projects are in the process of being implemented. PLN 2.4 b x2 • The Group’s IT systems were analysed in terms of process management, quality management and data security. EBITDA Margin IT 8.0% • Currently, the project is entering the operational phase - implementation of audit results and recommendations. Implementing sales goals • A new organisational structure of the Group was built, and the Group’s the Board of Directors was established. Group • As part of the Group's integration, the ZIP project is being

Wielton Group sales Wielton Group sales Wielton Group EBITDA integration implemented, concerning integrated production planning, a shared volume revenues margin warehouse policy and the development of uniform customer service (in thousands of (in PLN b) (%) standards. units.) 8,9% Goal forl 2020 25,0 Goal for 2020 2,4 7,3% Goal for 2020 8,0% 6,9% Production 15,1 1,6 platform and • Investments in the production plant in Wieluń 12,5 1,2 integration of • Investments in the production plant in Auxerre, Fruehauf SAS quality • Analysis of Langendorf production processes in terms of integration 4,4 0,5 processes

2016 2017 1Q 2018 2019 2020 2016 2017 1Q 2018 2019 2020 2016 2017 1Q 2018 2019 2020 New investments in the process of implementation

We are at the final stage of mechanical assembly of machines and equipment, in the testing phase of implemented new technologies, and on the verge of preparing for the final delivery and acceptance of new plant facilities.

Turbine shot blasting system Mechanical surface preparation for the KTL process. Stage: in the testing phase New investments in the process of implementation

Automated painting line for anti- corrosive protection of chassis and crates by cataphoresis • and 2 paint lines Stage: in the testing phase Investments - modernization

Assembly line – lower and upper transport for the pneumatic line and a fragment of the chassis assembly line. Stage: in the testing phase

Packaging warehouse - preparation of components, semi-products and products for assemblies in Italy, Russia and Africa, as well as production plants in Germany and France. Stage: in the testing phase Investments under preparation

Construction of a plant for trailers and refrigerated trailers

■ Planned start of works: 2018

■ Works related to the design of the building are currently

in progress

■ The planned date of completion is the end of 2019 2018 Development Prospects

■ Potential strengthening of the Group's position on the German market thanks to the integration

of the acquired Langendorf company

■ Favourable situation in Russia for increasing the Group’s revenues and sales on this market

■ Employee market: active salary pressure management planned in the second quarter

■ Implementation of planned investments according to schedule

■ Consistent implementation of the Group's strategic goals and subsequent projects WE INVITE YOU TO THE PRESENTATION OF THEWielton KTL S.A. LINE www.wielton.com.pl www.wieltongroup.com [email protected] Benefits of investing in Wielton

■ Ambitious development strategy: doubling the business scale within 4 years

■ Leader or in the top 3-5 on dynamically growing markets

■ Successful expansion in all regions: Poland, Western Europe, Russia

■ Acquisitions that bring expected results

■ Strong operating cash flows and secure financial position

■ Positive outlook for the remaining periods of the current year

■ Experienced management team with proven results

■ Regular dividend of 25-30% of net profit

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President of the Management Mariusz Mariusz Golec Waldemar Frąckowiak Krzysztof Krzysztof Mariusz Board Ryszard Paweł Piotr Piotr Kamiński Tadeusz Uhl

Szataniak Szataniak Tylkowski Półgrabia Prozner

ManagementBoard SupervisoryBoard

Tomasz Independent Independent Member of the Supervisory Board Member of the Supervisory Board Member of the Supervisory Board Secretary the of Supervisory Board Vice President of the Supervisory Board Vice Management Management Board - - President of the President President the of Supervisory Board Śniatała

Member Member of the Supervisory Board Member of the Supervisory Board

Włodzimierz Masłowski Włodzimierz Vice Management Management Board - President of the

Strona 25 This presentation was prepared by Wielton S.A. ("Company"). It is intended for information purposes only and should not be treated as investment advice. Neither the Company nor any of its subsidiaries shall be liable for any damages resulting from the use of this presentation or its content, or arising in any other way related to this presentation. Recipients of the presentation are solely responsible for their own analysis and assessment of the market and the market situation of the Company and the Capital Group made on the basis of the information contained in this presentation.

This presentation contains statements regarding the future. These statements are based on the current forecasts of the Management Board and depend on many factors, which are beyond the control of the Company, and which are subject to a number of known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity or achievements of the Company and the Capital Group to significantly differ from future results, or the level of activity or achievements expressed or suggested in statements regarding the future.

CONTACT FOR WIELTON S.A. INVESTORS ul. Rymarkiewicz 6 Tomasz Śniatała 98-300 Wieluń Board Vice-President, CFO www.wielton.com.pl mobile: +48 510 202 743 [email protected]