Zumtobel Group AG Q1-Q3 2016/2017...Q1-Q3 2016/17 – 07 March 2017 Nr. 6 Simplified illustration to highlight main building blocks of the adj. EBIT development Zumtobel Group –

Zumtobel Group AGQ1-Q3 2016/20177 March 2017

Nr. 2Q1-Q3 2016/17 – 07 March 2017

Substantial increase in profitabilityFinancials Q1-Q3 FY 2016/17 at a glance

� Group revenues fx-adjusted flat (-0.2%) in the first three quarters

� Group adj. EBIT increases by 29.9% to EUR 62.0 million (PY EUR 47.8 million) driven by improved cost structure in nearly all functional areas. The main contributions come from:

� Increase in plant efficiency based on our restructuring measures

� Good ramp-up of newly introduced products with better profitability

� Reduction in selling as well as R&D expenses

� Significant positive free cash flow of EUR 40.6 million (PY minus EUR 10.1 million)

� Outlook on 2016/17: improvement in adjusted Group EBIT to approx. EUR 70 million. The previous earnings forecast indicated a slight improvement over the previous year (2015/16: EUR 58.7 million).

Nr. 3Q1-Q3 2016/17 – 07 March 2017

Q1 Q2 Q3 Q4

15.7

Lighting Segment

Q1 Q2 Q3 Q4

254.8 265.7

Adjusted EBIT1)Revenues

10.5

4.1%

6,3%-2.4%(fx-adj. +1.1%)

Adjusted EBIT 2015/16


in EUR million



as a % of revenues

Revenues 2015/16

In EUR million

Revenues 2016/17

In EUR million

1) Reported EBIT adjusted for special effects

276.3

23.4231.6

5.1

9.2

248.7

8.5%

2.2%3.5%

-3.7%fx-adj. -0.3%)

266.024.1

9.1%

Substantial positive effects form restructuring and cost saving measuresLighting Segment – Revenue and EBIT development

Revenues Q1-Q3 FY 2016/17 EUR 747,0 million (minus 2.1%) Revenues Q1-Q3 FY 2015/16 EUR762.7million

Adjusted EBIT Q1-Q3 FY 2016/17 EUR 46.4 million (margin of 6.2%)Adjusted EBIT Q1-Q3 FY 2015/16 EUR 39.0 million (margin of 5.1%)

6.6

232.4

2.8%

+0.3%fx-adj. +3.6%)

Nr. 4Q1-Q3 2016/17 – 07 March 2017

Q1 Q2 Q3 Q4

Components Segment

Q1 Q2 Q3 Q4

109.397.3

9.88.8

9.0%

9.0%




in EUR million



as a % of revenues

Revenues 2015/16

In EUR million

Revenues 2016/17

In EUR million

106.2 12.996.3

5.7

98.5

6.6

12.1%

5.9% 6.7%

-11.1%(fx-adj. -8.2%)

93.4

-12.0%fx-adj. -9.3%)

12.7

13.6%

Higher profitability despite lower revenuesComponents Segment – Revenue and EBIT development


Revenues Q1-Q3 FY 2016/17 EUR 281.8 million (minus 9.6%) Revenues Q1-Q3 FY 2015/16 EUR 311.8 million


9.3

59.2

10.3%

91.1

-5.4%fx-adj. -2.5%)

Nr. 5Q1-Q3 2016/17 – 07 March 2017

Q1 Q2 Q3 Q4

Zumtobel Group

3.9%

8.0%

1.8%3.1%

Q1 Q2 Q3 Q4

342.4325.7

359.5

13.5

6.2%




in EUR million



as a % of revenues

Revenues 2015/16

In EUR million

Revenues 2016/17

In EUR million

28.8307.9

5.5

346.6

10.9

32.0

-4.9%(fx-adj. -1.4%)

20.1

341.6

-5.0%fx-adj. -1.6%)

9.4%

Sequentially improved growth dynamicsZumtobel Group – Revenue and EBIT development


Revenues Q1-Q3 FY 2016/17 EUR 973.4 million (minus 3.6%) Revenues Q1-Q3 FY 2015/16 EUR 1,009.9 million


10.0

3.3%

306.1

-0.6%fx-adj. +2.8%)

Nr. 6Q1-Q3 2016/17 – 07 March 2017

Simplified illustration to highlight main building blocks of the adj. EBIT developmentZumtobel Group – adj. EBIT Q1-Q3 FY 2015/16 vs. Q1-Q3 FY 2016/17

62.0

Adj. EBITQ1-Q3 2015/16

R&D Adj. EBITQ1-Q3 2016/17

47.8

3.7

4.9

Lower revenues and price pressure overcompensated by operations efficiency gains, better mix and material savings

[in EUR million]

5.6

Efficiency gains through group-wide bundling of R&D capacities

SG&A∆ Gross profit (before R&D)

Reduction in selling expenses

Nr. 7Q1-Q3 2016/17 – 07 March 2017

Higher special effects and deteriorating financial resultsZumtobel Group – Income statement

in EUR million Q1-Q3 2016/17 Q1-Q3 2015/16 Change in %

Revenues 973.4 1,009.9 -3.6

Cost of goods sold -583.8 -624.1 -6.5

Gross profit (w/o development) 389.6 385.8 1.0

as a % of revenues 40.0 38.2

R&D -61.0 -65.9 -7.4

SG&A expenses -266.5 -272.2 -2.1

Adjusted EBIT 62.0 47.8 29.9


Special effects -12.1 -7.6 60.5

EBIT 49.9 40.2 24.1


Financial results -14.5 -2.2

Profit before tax 35.4 38.0 -6.8

Income taxes -8.3 -8.8 -5.7

Result from discontinued operations 2.7 0

Net profit or loss for the period 29.8 29.2 2.0

Earnings per share ( in EUR) 0.69 0.68

Special effects related to adjustments to the global plant network (Usingen), ongoing restructuring (finetuning) of the sales organisation as well as the Lledó litigation settlement costs

Deteriorating financial result caused by FX volatility (mainly GBP and USD)

This reflects the release of a provision from the discontinuation of the event lighting business (Space Cannon VH SRL) in the second quarter of 2010/11.

Nr. 8Q1-Q3 2016/17 – 07 March 2017

in EUR millionQ1-Q3

2016/17Q1-Q3

2015/16

Cash flow from operating results 95.7 82.6

Change in working capital -10.6 -30.5

Change in other operating items -18.2 -29.8

Taxes paid/received -3.7 -2.0

Cash flow from operating activities 63.2 20.3

Proceeds from the sale of non-current assets 4.4 6.5

Capital expenditures on non-current assets -30.7 -43.3

Change in current and non-current financial assets 3.7 3.2

Change in liquid funds from changes in the consolidation range 0 -0.3

Assets held for sale 0 3.5

Cash flow from investing activities -22.6 -30.4

Free cash flow 40.6 -10.1

Cash flow from financing activities -40.2 39.0

Effects of exchange rate changes on cash and cash equivalents -0.1 -2.6

Change in cash and cash equivalents 0.3 26.3

Free cash flow development

Q1 H1 Q1-Q3 FY

7.4

(cumulative figures in EUR million)

FY 2015/16 FY 2016/17

-35.5

-24.9

-10.1

49.8

Significant positive Free cash flowZumtobel Group – Cash flow statement

41.5 40.6

Nr. 9Q1-Q3 2016/17 – 07 March 2017

Q3 2016/17 Q1-Q3 FY 2016/17

Revenues in EUR million

Change in %Revenues in EUR million

Change in %

nominalFX

adjusted

D/A/CH 86.8 1.3 288.9 -2.6 -2.2

Northern Europe 80.1 -4.3 252.3 -6.9 5.0

Benelux & Eastern Europe

40.6 16.2 125.7 10.1 11.2

Southern Europe 43.7 -2.2 138.1 -2.1 -2.1

Asia & Pacific 29.3 -6.9 94.2 -10.5 -10.5

Middle East & Africa 15.4 -14.8 44.3 -18.6 -18.5

America 10.2 9.8 29.8 8.5 8.3

Total 306.1 -0.6 973.4 -3.6 -0.2

Zumtobel Group

D/A/CH

29.7%

Northern Europe

25.9%

Benelux & Eastern Europe

12.9%

Southern Europe14.2%

Middle East & Africa

9.7%

4.6%

America 3.1%

Asia & Pacific

Regional revenue distribution

Sound development in Benelux & CEE, Austria, Italy and the USAZumtobel Group – Regional revenue distribution

Nr. 10Q1-Q3 2016/17 – 07 March 2017

Closure of luminaire plant in Usingen, Germany (announced on Apr 28, 2016)Progress Update / key facts

� Number of people affected in Usingen: ca. 150 FTEs

� Build-up of FTEs in other factories to swallow additional load: ca. 20 FTEs

� Third party revenues of Usingen plant in 2015/16: ca. 40 Mio EUR (thereof 6 Mio EUR “medicals”) – product portfolio has

been mainly transferred to Dornbirn (Austria) and Lemgo (Germany)

� Restructuring costs associated with closure: slightly below 20 Mio EUR (already fully included in YtD and last year’s

numbers)

� Pay-back: around 2 years

� Plant closed as of Dec 31, 2016

Nr. 11Q1-Q3 2016/17 – 07 March 2017

Disposal of luminaire plant in Les Andelys, France (announced on Dec 12, 2016)Progress Update / key facts

� Disposal of Les Andelys plant and entering into strategic partnership with Active’Invest

� Number of people affected in Les Andelys: ca. 230 FTEs

� Ongoing consultation process with the central works council / French authorities

� Signing is planned for Spring 2017

� Zumtobel Group will remain a 10% Shareholder in the NewCo

� Zumtobel Group will enter into a supply/purchase agreement with the NewCo for three years with a step down mechanism in terms of off-take obligation

� The negative special effects in our P&L will be around 15-20 Mio EUR (majority planned to be booked in Q4)

� Pay-back: around 4 years

Nr. 12Q1-Q3 2016/17 – 07 March 2017

New luminiare plant in Serbia (announced on Jan 27, 2017)Key facts

� Production in Serbia complements existing plants. The primary role is to handle the additional planned volume at optimal costs

� Time line phase 1: ground-breaking in Spring 2017, construction to be finished in H2 2018/19, ramp-up of production in H2 2018/19

� Time line phase 2: FY 2018/19 & 2019/20

� Total cost up to EUR 30 Mio (phase 1 ca. 20 Mio EUR and phase 2 ca. 10 Mio EUR), thereof 20 Mio EUR building costs & 10 Mio EUR machinery/tolling

� Size: After full-ramp up of phase 1 no. 3 in terms of size (No. 1 Dornbirn, No.2 Spenny) which implies up to 100 Mio EUR production value

� Business rationale: Currently personnel cost account for around 25% of the total production cost. Local wages are around 1/10 ofthose in Western Europe – critical for price sensitive products

� Pay-back: around 2 years once construction is finished, first savings expected in H2 2018/19

� Effect on Zumtobel Group’s mid-term capex guidance of around 5% of revenues: No principal change but capex in 2017/18 could be slightly higher

Nr. 13Q1-Q3 2016/17 – 07 March 2017

Zumtobel Group launches new Zumtobel Group Services (ZGS) business unitKey facts

� Zumtobel Group is experiencing significant changing customer demands

� Bundling the complete range of services within the Zumtobel Group in a single business division (ZGS) as of March 1, 2017

� One stop shop far reaching and innovative solutions with integral project management competence (managing the complexity of technology and portfolio spectrum)

� Innovative service portfolio will be marketed under new ZGS brand

� Service offering: light contracting, design services, data based services (IoT), consultation on intelligent lighting controls, project management, turnkey lighting solutions, after sales services, emergency lighting systems, connectivity products, etc.

� No. of people (existing): 240 FTEs

� Current revenues: approx. 140 Mio EUR

� Target: Over proportional growth with accretive margin profile

Nr. 14Q1-Q3 2016/17 – 07 March 2017

Detailed earnings guidance for the full 2016/17 financial yearZumtobel Group Outlook

� Industry environment remains challenging with widely different trends on a regional level

� Negative foreign exchange effects (esp. GBP/USD) will influence the development of revenues and earnings in Q4

� Based on the solid first quarter results and the substantial improvement of the cost structure, the Management Board of the

Zumtobel Group expects an adjusted Group EBIT for the full year of approx. EUR 70 million (PY EUR 58.7 million)

� Activities for 2016/17 will focus on continuation of strategic reorientation and implementation of all necessary

restructuring measures

Nr. 15Q1-Q3 2016/17 – 07 March 2017

Financial Calendar

� June 23, 2017 Annual Results 2016/17

� July 11, 2017 Record Date Annual General Meeting

� July 21, 2017 41st Annual General Meeting of Zumtobel Group AG

� July 31, 2017 Ex-Dividend Day

� August 1, 2017 Record Date Dividend

� August 2, 2017 Dividend Payout Day

� September 5, 2017 Report on the First Quarter 2017/18 (1 May 2017 – 31 July 2017)

� December 5, 2017 Report on the First Half-Year 2017/18 (1 May 2017 – 31 October 2017)

Thank you for your attention!

Nr. 17Q1-Q3 2016/17 – 07 March 2017

LED share of group revenues increases to 72.9% (Q1-Q3 2015/16: 62.9%)Zumtobel Group – LED revenue development

Q1 Q2 Q3 Q4

Zumtobel Group LED revenues

206.2

10.4%

LED revenues 2015/16

In EUR million

LED revenues 2016/17

In EUR million

227.5

201.2

225.4

XXX

� LED revenues in Q1-Q3 2016/17 grow by 11.7% to EUR 709.5 million

� LED share of group revenues increases to 72.9% (Q1-Q3 2015/16: 62.9%)

� Lighting Segment increases sales with LED products by 15.4% to EUR 542.6 million (LED Penetration 72.6%)

� LED sales in Components Segment flat (plus 0.2%) due to sale of signage business (LED Penetration 76.4%)

227.7

10.4%

251.114.7%

230.7

Nr. 18Q1-Q3 2016/17 – 07 March 2017

Working capital below prior year levelZumtobel Group – Working capital

Working capital

Q1 Q2 Q3 Q4

in % of rolling 12-month revenues

FY 2014/15 FY 2015/16 FY 2016/17

19.0%18.0%

18.9%17.8%

20.4% 20.1%18.9%

17.0%

18.7%

� Working capital at EUR 240.0 million as of January 2017 (January 2016: EUR 256.5 million)

� In % of rolling 12-month revenues, working capital down to 18.2% (January 2016: 18.9%)

� Decrease in inventories (~ EUR 3 million vs. Jan 16), decrease in receivables (~ EUR 10 million vs. Jan 16), and increase in payables (~ EUR 5 million vs. Jan 16)

19.2%18.2%

Nr. 19Q1-Q3 2016/17 – 07 March 2017

Continued solid balance sheet structure and secured liquidity positionZumtobel Group – Key balance sheet data

in EUR million 31 January 2017 30 April 2016

Total assets 1,035.5 1,068.6

Net debt 120.3 134.8

Equity 341.4 333.2

Equity ratio in % 33.0 31.2

Gearing in % 30.7 40.5

Investments 30.7 58.4

Working capital 254.0 231.2

As a % of rolling 12 months revenues 18.2 17.0

� Net debt totalled EUR 120.3 million as of 31 January 2017 (31 January 2016: EUR 186.4 million)

� Secure liquidity position backed by:

− Syndicated credit facility with a term ending November 2021 and a max. volume of EUR 300 million (EUR 85 million drawn by 31 January 2017)

− Two bilateral bank credit agreements of EUR 40 million each with a term extending to September 2018 respectively January 2020 (fully drawn by 31 January 2017)

− Uncommited lines of credit totalling EUR 89.6 million as of 31 January 2017

Nr. 20Q1-Q3 2016/17 – 07 March 2017

Tribunal award in the lawsuit of Lledó vs Zumtobel (announced on Dec 28, 2016)Key facts

� Lawsuit in connection with the termination of the 2008 distribution agreement with the former Spanish distributor Lledó

� The termination gives the Zumtobel Group full freedom to operate in Spain through a own sales force in line with its strategy

� As expected, the Tribunal granted Lledó damages for early termination of the agreement by Zumtobel Lighting in the amount

EUR 934 Tsd (the respective provision in Zumtobel books amounted to EUR 1.3 million)

� As not expected, the Tribunal also granted Lledó a post-contractual indemnity of EUR 6.2 million on the basis of a highly questionable

legal argument (calculation of indemnity was based on the discounted cashflow method)

� No promising legal recourse is possible against this arbitral award

� The entire liability (after deducting the provisions) has been booked as special effect in Q3 (litigations settlement cost – EUR 5.9 Mio)

Nr. 21Q1-Q3 2016/17 – 07 March 2017

Determined to unlock full potential in Global OperationsProgress report Global Operations - Overview

Restructuring measures

2013

• Closure of Fürstenfeld, AUT

• Closure of Melbourne, AUS

2014

• Closure of Tianjin, CN

• Closure of Landskrona, SWE

• Closure of Ennenda, CH

• Sale of connection technology business, Innsbruck, AUT

2015

• Sale of magnetics business, Auckland, NZL

• Restructuring of Lemgo, GER

2016

• Closure of Usingen, GER, per 31 Dec 2016

2017

• Expected Disposal of Les Andelys, F

• Construction of new luminiare plant in Serbia DornbirnAUT

LemgoGER

Les AndelysFRA

GuanghzouCHN

HighlandUSA

Wetherill Park, SydneyAUS

AucklandNZL

ShenzhenCHN

JennersdorfAUT

SpennymoorGB

Key

Luminaire plant

Components plant

Production volume

> €100 million

Production volume

> €50 million

Production volume

< €50 million

Barrowford (acdc)GB

NisSERBIA

UsingenGER

Nr. 22Q1-Q3 2016/17 – 07 March 2017

Supplement data on Special EffectsZumtobel Group – Special Effects

Major positions:

� Closing of Usingen (EUR -6.2 million)

� Restructuring of sales organisation (EUR -0.9 million)

� Lledó litigation settlement costs (EUR -5.9 million)

� Property sale Ennenda (EUR +2.5 million)

Adjusted EBIT in EUR million Q1-Q3 2016/17 Q1-Q3 2015/16 Change in %

Reported EBIT 49.9 40.2 24.1

Thereof special effects -12.1 -7.6 60.5

Adjusted EBIT 62.0 47.8 29.9

Special Effects: EUR 12.1 million

Nr. 23Q1-Q3 2016/17 – 07 March 2017

Supplement data regarding Segment ReportingZumtobel Group – Segment Reporting

Lighting Segment Components Segment Reconciliation Group

in TEUR Q1-Q3 2016/17 Q1-Q3 2015/16 Q1-Q3 2016/17 Q1-Q3 2015/16 Q1-Q3 2016/17 Q1-Q3 2015/16 Q1-Q3 2016/17 Q1-Q3 2015/16

Net revenues 747.046 762.695 281.783 311.837 -55.448 -64.630 973.381 1.009.902

External revenues 746.846 762.079 226.510 247.747 25 73 973.381 1.009.900

Inter-company revenues 200 614 55.273 64.090 -55.473 -64.704 0 0

Operating profit/loss 31.709 28.108 33.599 32.205 -15.403 -20.094 49.905 40.217

Investments 17.283 25.006 9.385 14.881 4.034 3.398 30.702 43.285

Depreciation -26.874 -27.077 -15.324 -16.682 -3.317 -2.970 -45.515 -46.729

Nr. 24Q1-Q3 2016/17 – 07 March 2017

Five-Year Overviewin EUR million 2015/16 2014/15 2013/14 2012/13 2011/12

Revenues 1,356.5 1,312.6 1,246.8 1,243.6 1,280.3

Adjusted EBIT 58.7 66.5 47.6 35.7 35.0

as a % of revenues 4.3 5.1 3.8 2.9 2.7

Net profit/loss for the period 11.9 11.9 -4.8 6.1 15.2

as a % of revenues 0.9 0.9 -0.4 0.5 1.2

Total assets 1,068.6 1,086.3 1,006.6 994.8 1,036.3

Equity 333.2 322.6 327.6 357.4 370.6

Equity ratio in % 31.2 29.7 32.5 35.9 35.8

Net debt 134.8 148.2 126.2 113.2 141.4

Cash flow from operating results 84.8 103.1 79.5 79.8 88.1

Investments 58.4 76.6 65.6 59.5 57.2

as a % of revenues 4.3 5.8 5.3 4.8 4.5

R&D total 87.9 79.0 71.8 69.1 58.7

as a % of revenues 6.5 6.0 5.8 5.6 4.6

Headcount incl. contract worker (full-time equivalent) 6,761 7,234 7,291 7,162 7,456

Nr. 25Q1-Q3 2016/17 – 07 March 2017

Disclaimer

The facts and information contained herein constitute forward-looking statements as of the date they were made and based upon assumptions as to future events or circumstances that may not prove to be complete or accurate. By their nature, these statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and are difficult to predict. Therefore, actual outcomes or results may differ materially from what is expressed, implied or forecasted in these statements. Neither Zumtobel Group AG nor any of its directors, officers, employees or advisors nor any other person makes any representation or warranty, expressed or implied, as to the accuracy or completeness of the facts and information contained in this document or the related oral presentation thereof, including responses to questions following the presentation. Neither Zumtobel Group AG nor any of its directors, officers, employees and advisors nor any other person shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this document, the facts and/or information.

Whilst all reasonable care has been taken to ensure the facts stated herein are accurate and that the assumptions and opinions contained herein are fair and reasonable, this document is selective in nature and is intended to provide an introduction to, and overview of, the business of Zumtobel Group AG as of the date this document was made. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by Zumtobel Group AG as being accurate.

Contacts:Investor RelationsTel.: +43 (5572) [email protected]

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Zumtobel Group AG Q1-Q3 2016/2017...Q1-Q3 2016/17 – 07 March 2017 Nr. 6 Simplified illustration to highlight main building blocks of the adj. EBIT development Zumtobel Group –