Investor presentation, December 2019 Becoming the leader in intelligent cargo handling Investor presentation December 2019 1 Investor presentation December 2019 2 Content 1. Cargotec in brief 2. Investment highlights 3. Kalmar 4. Hiab 5. MacGregor 6. Recent progress 7. Appendix 3 Cargotec in brief 4 4 Strong global player with well-balanced business Sales: Sales split: new Sales by Sales by EUR 3,304 million equipment vs service business areas geographical area EBIT: 7.3% and software Kalmar Service and MacGregor Kalmar EMEA software 49% AMER Sales: EUR 1,618 million 16% 49% 34% 31% EBIT: 8.9% (EUR 143.6 million) Hiab Sales: EUR 1,149 million EBIT: 11.7% (EUR 134.5 million) Hiab MacGregor 35% APAC Sales: EUR 538 million New equipment 20% EBIT: -0.3% (EUR -1.6 million) 66% Strengths we are building upon Leading market positions Strong brands Loyal customers Leading in technology in all segments Figures: 2018 EBIT = Comparable operating profit Investor presentation December 2019 5 Key competitors Cargotec is a leading player in all of its business areas Global main competitors Other competitors Investor presentation December 2019 6 Currently two businesses performing well Net sales* in Q4/18-Q3/19 Trend in orders, Profitability: Comparable EBIT EUR million last 12 months margin ~400 Kalmar software (Navis) ~1,300 and Automation and Projects Low due to long term division investments ~600 MacGregor 3,578 +39% -3.8% Hiab +23% 11.8% ~1,300 Kalmar MacGregor Kalmar equipment and service equipment Kalmar APD and (excluding Automation and Low double digit Hiab software Projects Division & Navis) * Figures rounded to closest 100 million Investor presentation December 2019 7 Investment highlights 8 Investment highlights: Why invest in Cargotec? 1. Technology leader and strong market positions, leading brands in markets with long term growth potential 2. Our vision is to become the global leader in intelligent cargo handling 3. Growing service & software business and asset-light business model are increasing stability 4. Capitalising global opportunities for future automation and software growth 5. On track for profitability improvement and to reach financial targets Investor presentation December 2019 9 1. Technology leader and strong market positions, leading brands in markets with long term growth potential Global Growth Competitive Market megatrends drivers advantages position . Globalisation . Container . Strong brands . #1 or #2 in all and trade throughput . Full major growth growth automation segments . Urbanisation . Construction offering . Growing activity . Technology middle class . Automation leadership . Digitalisation Investor presentation December 2019 10 2. Our vision is to become the global leader in intelligent cargo handling VISION GLOBAL LEADER IN INTELLIGENT CARGO HANDLING WIN THROUGH CUSTOMER CENTRICITY ACCELERATE DIGITALISATION We help our customers achieve their goals We build and expand our digital solutions to offer by aligning our offering and way of working to a great customer experience and more efficient serve them better. business processes. MUST-WIN BATTLES ADVANCE IN SERVICES PRODUCTIVITY FOR GROWTH We extend our offering towards intelligent solutions that We focus on activities that add value and benefit enable us to serve our customers wide across their our customers and us by developing our lifecycle. business operations and common platforms. Investor presentation December 2019 11 3. Growing service & software business and asset-light business model are increasing stability Service and software* sales Asset-light business model with a flexible cost MEUR structure . 1,200 Kalmar and Hiab: efficient assembly operation 1,090 1,126 1,100 1,052 1,053 +4% +3% . MacGregor: efficient project management and 147 1,000 955 +10% 121 +0% 152 engineering office: > 90% of manufacturing and +9% 149 900 873 108 30% of design and engineering capacity outsourced 107 800 . No in-house component manufacturing 700 600 Next steps to increase service and software sales: 500 980 931 905 938 . Improve service offering through digital solutions 400 847 766 . 300 Build on Navis position as industry leader 200 . Increase spare parts capture rates 100 . Boost service contract attachment rates 0 2013 2014 2015 2016 2017 2018 Services Software *) Software sales defined as Navis business unit and automation software Investor presentation December 2019 12 4. Capitalising global opportunities for future automation and software growth Industry trends support growth Significant possibility in port Automation creates significant cost savings* in port automation: software: Labour costs 60% less labour costs . Only 40 terminals (out of 1,200 . Container value chain is very Total costs 24% less costs terminals) are automated or semi- inefficient: total value of waste and Profit increase 125% automated currently globally inefficiency estimated at ~EUR 17bn . Ships are becoming bigger and . Over 50% of port software market is the peak loads have become an issue in-house, in long term internal . Increasing focus on safety solutions not competitive . Customers require decreasing energy Navis has leading position in usage and zero emission ports port ERP . Optimum efficiency, space utilization Customers consider their automation and reduction of costs are increasingly decisions carefully important . Shipping line consolidation . Shortage and cost of trained and . Utilisation rates of the existing skilled labour pushes terminals to equipment base automation . Container throughput volumes * Change when manual terminal converted into an automated operation . Efficiency of the automation solutions Investor presentation December 2019 13 5. Clear plan for profitability improvement and to reach financial targets Growth Profitability Sales and comparable operating Target to grow faster than market Target 10% operating profit and profit development . 15% ROCE in 3-5 years* Megatrends and strong market 4,500 6.2% 400 7.1% position supporting organic growth 4,000 4.4% Higher service and software sales 4.0% 3,729 8.0% 7.3% 350 3,514 . M&A potential key driver for profitability 3,500 3,358 3,304 3,181 3,250 300 improvement 3,000 250 Cost savings actions: 2,500 259 Service and software 250 242 231 200 Targeting service and software sales . 2020 EUR 30 million (indirect 2,000 150 40% of net sales, minimum EUR 1.5 purchasing and new Business 1,500 Services operations) 149 billion in 3-5 years* 1,000 127 100 Product re-design and improved 500 50 project management Balance sheet and dividend 0 0 Target gearing < 50% and 2013 2014 2015 2016 2017 2018 increasing dividend in the range of 30-50% of EPS, dividend paid twice Net sales Comparable operating profit margin a year Comparable operating profit *Target announced in September 2017 Investor presentation December 2019 14 Kalmar Investor presentation 15 15 Container throughput still forecasted to grow year on year TEU million Growth from 2013 to 2023 48% 1,000 948 CAGR 4.0% 912 +4.0% 875 +4.2% 838 +4.4% 133 784 806 129 800 +4.0% 125 748 120 702 +2.6% 675 685 +4.7% 115 117 642 +6.5% 109 235 +2.6% 101 227 98 +1.5% 101 220 600 96 +5.1% 213 202 206 195 182 182 185 173 400 556 581 504 530 444 466 482 200 373 395 401 416 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 APAC EMEA AMER 2019-2023: Drewry: Container forecaster Q3 2019 2016-2017: Drewry: Container forecaster Q2 2019 2015 Drewry: Container forecaster Q2 2018 2013-2014 Drewry Global Container Terminal Operators Annual Report 2013 Investor presentation December 2019 16 Flexible and scalable Navis TOS software Terminal Operating System (TOS) Terminal Logistic System Truck / Transfer area Automated Horizontal Transportation Automatic stacking crane (ASC) area Quay crane area ASC stack area Equipment Equipment Investor presentation December 2019 17 Kalmar’s operating environment Provides integrated port automation The collaboration platform solutions including software, serving the needs of ocean services and a wide range of cargo carriers, terminals and their Transfer handling equipment shipping partners area Yard Horizontal Transportation TOS coordinates and optimises Industry leading spreader the planning and management manufacturer Quay of container and equipment moves in complex business environments. Navis provides also maritime shipping solutions: . Stowage planning . Vessel monitoring . Loading computer . Route planning Investor presentation December 2019 18 XVELA provides benefits to ocean carriers and terminal operators . Today’s container supply chain is a fragmented and siloed framework . Information sharing between parties is not optimally structured – Forms of communication today include email, phone calls, EDI, paper plans – Problems: incomplete data, errors, information not available on time . In-house developed XVELA is a many-to-many platform to solve these issues – Real-time stowage collaboration – Port-to-port visibility and collaboration – Synchronisation of planning between carriers and terminals Benefits of XVELA: . Faster vessel turn times . Operational efficiencies . Cost savings Investor presentation December 2019 19 Services provide our biggest medium-term growth opportunity Market Equipment & Projects Software Services share 20-30% 20-30% 3-5% Market size 6B€ 0.5-1B€ 8B€ Investor presentation December 2019 20 Automation deals highlight our successful investments in automation Kalmar and Navis to deliver world-first intermodal automation solution to Sydney, Australia Greenfield intermodal terminal, Qube’s Moorebank Logistics