ANDRITZ Roadshow presentation July...

Company presentation July 2015 ANDRITZ GROUP

Contents:

1. ANDRITZ GROUP overview

3. Long-term goals and summary/outlook

2. Business areas: market update

KEY FINANCIAL FIGURES 2014

* MEUR = million euro

The ANDRITZ GROUP Overview

Unit 2014

Order intake MEUR* 6,101.0

Order backlog (as of end of period) MEUR 7,510.6

Sales MEUR 5,859.3

EBITA MEUR 379.5

Net income (including non-controlling interests) MEUR 210.0

Employees (as of end of period; without apprentices) - 24,853

Profile: globally leading supplier of plants, equipment, and services for hydropower stations, the pulp and paper industry, the metal-working and steel industries, and solid/liquid separation in the municipal and industrial sectors Headquarters: Graz, Austria Global presence: over 250 production sites and service/sales companies worldwide

3 Company presentation July 2015

Product offerings: equipment for production of all types of pulp, paper, tissue, and board; energy boilers Order intake 2014: 1,996 MEUR Sales 2014: 1,969 MEUR Share of ANDRITZ GROUP’s total order intake: 30-35%

Worldwide leading position in four business areas HYDRO and PULP & PAPER …

Product offerings: electromechanical equipment for hydropower plants (turbines, generators); pumps; turbo generators Order intake 2014: 1,817 MEUR Sales 2014: 1,752 MEUR Share of ANDRITZ GROUP’s total order intake: 30-35%


Product offerings: equipment for solid/liquid separation for municipalities and various industries; equipment for production of animal feed and biomass pellets Order intake 2014: 596 MEUR Sales 2014: 587 MEUR Share of ANDRITZ GROUP’s total order intake: 10%

Product offerings: presses for metalforming (Schuler); systems for production of stainless steel, carbon steel, and non-ferrous metal strip; industrial furnace plants Order intake 2014: 1,693 MEUR Sales 2014: 1,550 MEUR Share of ANDRITZ GROUP’s total order intake: 25%

… METALS and SEPARATION


6

Strengthening of market position Growth through organic expansion and acquisitions

Acquisitions by business area since 1990

2011 Iggesund Tools 2011 Tristar Industries 2011 Asselin-Thibeau 2012 AES 2013 MeWa 2015 Euroslot METALS 1997 Sundwig 1998 Thermtec 2000 Kohler 2002 SELAS SAS Furnace Div. 2004 Kaiser 2005 Lynson 2008 Maerz 2012 Bricmont 2012 Soutec 2013 Schuler (> 95%) 2013 FBB Engineering 2014 Herr-Voss Stamco SEPARATION 1992 TCW Engineering 1995 Jesma-Matador 1996 Guinard 2000 UMT 2002 3SYS 2004 Bird Machine 2004 NETZSCH Filtration 2004 Fluid Bed Systems 2005 Lenser Filtration 2006 CONTEC Decanter 2009 Delkor Capital Equipment 2009 Frautech 2010 KMPT 2012 Gouda 2013 Shende Machinery

HYDRO 2006 VA TECH HYDRO 2007 Tigép 2008 GE Hydro business 2008 GEHI (JV) 2010 Precision Machine 2010 Hammerfest Strøm (59%) 2010 Ritz 2011 Hemicycle Controls PULP & PAPER 1990 Sprout-Bauer 1992 Durametal 1994 Kone Wood 1998 Kvaerner Hymac 1999 Winberg 2000 Ahlstrom Machinery 2000 Lamb Baling Line 2000 Voith Andritz Tissue LLC (JV) 2002 ABB Drying 2003 IDEAS Simulation 2003 Acutest Oy 2003 Fiedler 2004 EMS (JV) 2005 Cybermetrics 2005 Universal Dynamics Group 2006 Küsters 2006 Carbona 2006 Pilão 2007 Bachofen + Meier 2007 Sindus 2008 Kufferath 2009 Rollteck 2010 Rieter Perfojet 2010 DMT/Biax 2011 AE&E Austria

1,481 1,744

2,710 3,283

3,610 3,198

3,554

4,596

5,177 5,711

5,859

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Sales (in MEUR) Order intake (in MEUR)

Compound Annual Growth Rate (CAGR) of Group sales 2004-2014: +14% p. a. (thereof approximately half organic growth)

Company presentation July 2015

EBITA (MEUR) EBITA MARGIN (%)

48.6

73.4

Earnings and profitability improved from low level in Q1 14 Negative impact from valuation of FX-forward contracts

Q1 2014 Q1 2015

Q1 2014: 4.0%

Q1 2015:

5.2%

Decrease of EUR vs. USD led to temporary exchange rate differences from negative market values from the valuation of FX-forward contracts (concluded to hedge non-euro contracts) in

the amount of approx. 13 MEUR. Excluding these effects, EBITA margin would have been 6.1%.

+51%


Unit Q1 2015 Q1 2014 +/- 2014

Order intake MEUR 1,430.6 1,742.2 -17.9% 6,101.0

Order backlog (as of end of period) MEUR 7,785.6 7,734.7 +0.7% 7,510.6

Sales MEUR 1,404.3 1,219.5 +15.2% 5,859.3

EBITDA MEUR 96.1 69.5 +38.3% 472.0

EBITA MEUR 73.4 48.6 +51.0% 379.5

EBIT MEUR 61.5 29.0 +112.1% 295.7

EBT MEUR 62.6 27.5 +127.6% 299.4

Financial result MEUR 1.1 -1.5 +173.3% 3.7

Net income (including non-controlling interests)

MEUR 43.8 19.3 +126.9% 210.0

Cash flow from operating activities MEUR 37.2 61.0 -39.0% 342.1

Capital expenditure MEUR 20.8 17.2 +20.9% 106.5

Equity ratio % 16.4 16.2 - 17.0

Liquidity MEUR 1,610.2 1,524.0 +5.7% 1,701.6

Net liquidity (after deduction of all financial liabilities) MEUR 1,114.2 891.1 +25.0% 1,065.1

Net working capital MEUR -673.2 -590.2 -14.1% -570.9

EBITDA margin % 6.8 5.7 - 8.1

EBITA margin % 5.2 4.0 - 6.5

EBIT margin % 4.4 2.4 - 5.0

Employees (as of end of period; without apprentices) - 24,855 23,790 +4.5% 24,853

Key figures Q1 2015 at a glance

Unchanged solid level of net

working capital

Increase in net liquidity mainly due

to higher project-related customer

advances


Contents:




10

HYDRO Challenging, but solid market environment

Large-scale plants Small-scale plants Pumps

Market

update

>> Solid, but rather slow project activity for modernizations in Europe and North America

>> Pumped storage projects on hold due to low electricity prices

>> Greenfield hydropower projects in emerging

markets, including some very large projects

Good activity, especially in emerging markets (high energy demand, low capex needs)

Demand for special pumps to remain at good level (irrigation, water transport, nuclear, etc.)

Competition Stable competition at challenging level. Main competitors: GE/Alstom, Voith

Outlook Stable


Long-term average growth

potential:

3-4% p.a.

Stable Stable

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E

CAGR 2014-2025E

■ Small hydro +2.7%

■ Pumped storage +6.6%

■ Large conventional hydro +3.1%

Cumulative installed hydropower capacity in GW Average annual growth of 3.6% expected for 2014-2025E

11

Source: GlobalData

756 765 773 798 820 842 865 897 930 961 1,000 1,033 1,068 1,102 1,137 1,180 1,224

1,270 1,319

1,367 1,422

1,471 1,519

1,571 1,621

1,671


+3.0%

2014: more than 75% of total hydropower capacity came from large conventional

hydropower plants with a capacity of 864 GW. The remainder came from small

hydro and pumped storage capacities at 131 GW and 142 GW respectively.

12

Favorable modernization potential: more than half of hydropower capacity installed worldwide over 30 years old

Sources: GlobalData, Hydropower & Dams World Atlas 2014


Average: 54% more than 30 years old

Average growth rate 2014-2025E by region in %

+38%

+27%

+17%

+7%

+6%

+5%

13

Installed hydropower capacity 2014 by region in %

█ Europe █ China █ North/Central America █ Asia (without China) █ South America █ Africa

18

26

16

23

14 3

1,137 GW

China

Asia (without China)

South America

Africa

North/Central America

Europe

Sources: GlobalData, Hydropower & Dams World Atlas 2014

Regional share of 500 GW approximate increase in total installed hydropower capacity expected by 2025


14

PULP & PAPER Good project activity, but unchanged challenging competition

Pulp Paper/packaging Nonwoven/plastic film Service

Market

update

>> Investments in greenfield pulp mills to continue

>> Modernization projects to increase

capacity, efficiency, and profitability of existing mills

>> Green energy investments

>> Some selective biomass pelleting projects

>> Stable demand for tissue and containerboard machines, predominantly in emerging markets

>> More stringent quality

requirements for food packaging

>> Stable and good project activity for nonwoven

>> Good potential in

certain niches

>> Plastic film: sharp market decline due to overcapacity

Good potential to grow organically and by acquisitions

Competition Unchanged challenging competition. Main pulp competitor: Valmet

Outlook


potential:

2-3% p.a.

Stable +/- Stable +/-


15

Average age of pulp mills by region shows a major modernization drive especially in Europe and North America

Source: RISI, Pöyry Europe


█ Europe █ China █ North America █ Asia (excl. China) █ Latin America █ Africa

24

23 22

21

9 1

Pulp capacity 2014 by region in %

474 million tons

per year

Mozambique: Chile: Owner – project Capacity/a.* Planned start-up

Arauco – Bio-Bio 1.6 2018 et seq.

16

Good project activity for greenfield pulp mills

* Annual capacity in million tons; source: Pöyry. Capacity/year refers to added gross capacity (i.e. relevant as accessible market) without taking possible shut-downs of existing capacities into account

Brazil: Owner – project Capacity/a.* Planned start-up

Fibria – Três Lagoas 1.8 2017 et seq. Eldorado – Três Lagoas 2.3 2018 et seq.

Veracel – Eunápolis 2.0 2019 et seq. Braxel – Peixes 1.5 2019 et seq.

CRPE Holding S.A – Ribas do Rio Pardo 2.2 2019 et seq.

Eldorado – Três Lagoas 2.0 2019 et seq. Suzano – Imperatriz 1.3 2019 et seq.

Fibria – Aracruz 1.7 2019 et seq.

Owner Capacity/a.* Planned start-up Portucel 1.5 2020 et seq.

Finland:

Owner – project Capacity/a.* Planned start-up Finnpulp – Kuopio 1.1 2019 et seq.

China: Owner – project Capacity/a* Planned start-up

Guangxi Jingui – Qinzhou City 1.2 2019 et seq.


17

METALS: good project activity in metalforming, aluminum, and furnaces – unchanged low activity in carbon/stainless steel


potential 2-3% p.a.

Metalforming Stainless steel Furnaces

Market

update

>> Good demand from automobile manufacturers continuing, especially in Asia and Americas

>> Stable demand from other industries

Investment activity to remain at low level, some investment projects planned in H2 2015

Good demand to continue

Competition Stable competition at challenging level

Main competitors from Japan and China Main competitors: Danieli, SMS, Primetals (Mitsubishi/VAI)

Outlook


potential:

4-5% p.a.

Stable + Stable - Stable +


18

Yadon ANDRITZ subsidiary Schuler acquires 51% stake

>> Profile: Yadon is one of the leading manufacturers of mechanical presses in China >> Main customer segments: automotive supplying, household appliances, and metal working industries in Eastern China >> Annual sales: ~120 MEUR >> ~1,100 employees at three locations in China; based in Yangzhou, Jiangsu Province (around 300 kilometers north of Shanghai) >> The investment in Yadon extends Schuler’s product portfolio in the middle and lower price segments and provides access to a customer base not yet served in China, the largest market in the world for presses >> Acquisition is subject to approval by anti-trust authorities

Yangzhou

Yadon headquarters, China



Aluminum A material with a promising future

Source: Visiongain

Aluminum consumption

(in million tons) 2013 2023E

CAGR 2013-2023E (in %)

Transportation 12.4 27.6 +8.3%

Construction 10.6 21.4 +7.3%

Packaging 6.5 14.2 +8.2%

Electrical 5.5 8.9 +4.9%

Consumer goods 4.6 7.1 +4.4%

Machinery 3.7 7.1 +6.8%

Other 2.8 2.7 -0.4%

Total 46.1 89.0 +6.9%

ANDRITZ METALS (ex Schuler) products: >> Melting, holding, heat treatment furnaces

>> Process lines

>> Rolling mills

>> Finishing lines

>> Welding

Thereof 70% automotive

12.0

7.5

2.2

53.2

10.7

3.4

8.6

5.2

1.5

20.9

7.0

2.9

■ 2013

■ 2023E

Others

Asia (without China)

China

Latin America

North America

Europe

Significant growth is coming from China

Aluminum consumption by region in million tons:

20

SEPARATION Mixed development of markets

Municipal Industrial Feed Biomass pelleting

Market

update

Investment activity at reasonable levels, mainly in developed markets

>> Reasonable demand in food processing and chemicals

>> Low project activity in

mining/minerals

Continuing at solid level Stable demand to continue

Competition Very fragmented market with global and regional competitors

Outlook Stable +/- Stable +/- Stable + Stable +



potential:

2-3% p.a.

Contents:




4.7 5.2 5.3 5.1

6.3 6.1 6.1 6.4 6.5

5.1*

7.2 7.2 6.9

2.9**

6.5

937 1,319 1,110 1,225

1,481 1,744

2,710

3,283 3,610

3,198 3,554

4,596

5,177 5,711**

5,859

0

1,000

2,000

3,000

4,000

5,000

6,000

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

EBITA margin (%) Sales (MEUR)* Including restructuring expenses ** Including Schuler as of March 1, 2013; no pro forma figures are available for the reference periods of previous years

Target to continue long-term profitable growth Goal: maintain 7% and improve to 8% with top-line sales growth

22

%

MEUR

Long term:

maintain 7% and improve to

8% with top-line sales growth

Average 2005-2009:

6.0% Average 2000-2004:

5.3%

5.7


Summary and outlook

Company presentation July 2015 23

HYDRO Project activity for modernizations and new hydropower stations to continue at current level; satisfactory market activity for pumps to continue

PULP & PAPER Solid project activity for modernizations/capacity increases and power/ biomass boilers; good pipeline for green-/brownfield pulp mill projects

METALS Global metalforming market to stay at good level; steel at unchanged subdued level; good market activity in aluminum to continue

SEPARATION Low project activity in mining to remain; solid project activity in chemicals; good investment activity in environment, food, and feed/biomass pelleting

ANDRITZ GROUP 2015 Slight increase in sales and improvement of earnings expected

Stable + Stable + Stable +/-

>> Continuation of long-term structural trends within all four business >> Focus on profitability improvement and projects with areas should support long-term organic growth of ANDRITZ reasonable risk/reward profile

>> Acquisitions will remain strategic focus to complement product range and support long-term growth

Stable +/-

Financials Appendix:

4,132

5,707 4,924

5,611 6,101

2010 2011 2012 2013 2013

3,554 4,596

5,177 5,711 5,859

2010 2011 2012 2013 2014

7.2 7.2 6.9

2.9

6.5

2010 2011 2012 2013 2014

ANDRITZ GROUP Sales, order intake, EBITA, and EBITA margin 2010-2014

Sales (in MEUR): CAGR +13%

25

Order intake (in MEUR): CAGR +10%

EBITA (in MEUR)

EBITA margin (in %)

Average

4,979 MEUR

Average

5,295 MEUR

Average

298 MEUR

Average

6.1%

257.6 331.5 357.8

164.1

379.5

2010 2011 2012 2013 2014

1,870 2,096 2,008 1,865 1,817

2010 2011 2012 2013 2014

1,579 1,773 1,837 1,805 1,752

2010 2011 2012 2013 2014

HYDRO Sales, order intake, EBITA, and EBITA margin 2010-2014


26

Order intake (in MEUR): CAGR -1%

EBITA (in MEUR)

EBITA margin (in %)

Average

1,749 MEUR

Average

1,931 MEUR

Average

142 MEUR

Average

8.1%

118.0 147.7 153.2 146.9 144.8

2010 2011 2012 2013 2014

7.5 8.3 8.3 8.1 8.3

2010 2011 2012 2013 2014

1,416

2,694

1,962 1,908 1,996

2010 2011 2012 2013 2014

1,130

1,885 2,282

2,005 1,969

2010 2011 2012 2013 2014

Average

4.6%

7.3 6.4 5.9

-1.8

5.2

2010 2011 2012 2013 2014

82.2

120.4 134.6

-35.7

102.9

2010 2011 2012 2013 2014

PULP & PAPER Sales, order intake, EBITA, and EBITA margin 2010-2014


27


EBITA (in MEUR)

EBITA margin (in %)

2013

2013

Average

1,854 MEUR

Average

1,995 MEUR

Average

81 MEUR

5.4 5.2 6.2

4.1*

7.1**

2010 2011 2012 2013 2014

18.4 19.4 25.1

53.5

110.2

2010 2011 2012 2013 2014

303 319 324

1,234

1,693

2010 2011 2012 2013 2014

340 373 405

1,311 1,550

2010 2011 2012 2013 2014

METALS Sales, order intake, EBITA, and EBITA margin 2010-2014

Sales (in MEUR): CAGR +46%*

28

Order intake (in MEUR): CAGR +54%*

EBITA (in MEUR)

EBITA margin (in %)

* +2% ex Schuler

* +13% ex Schuler

Average ex Schuler:

367 MEUR

Sch

uler

: 967

S

chul

er:

868

39.7

*

* Schuler: 4.1% (8.4% before restructuring expenses)

Average ex Schuler:

362 MEUR

Average ex Schuler:

17.7 MEUR

Average ex Schuler:

4.8%

Sch

uler

: 1,1

78

Sch

uler

: 1,

194

* thereof Schuler

98.4

*

** Schuler: 8.4%

544

598

629

604 596

2010 2011 2012 2013 2014

505 566

653 590 587

2010 2011 2012 2013 2014

Average

5.2%

7.7 7.8 6.9

-0.1

3.7

2010 2011 2012 2013 2014

SEPARATION Sales, order intake, EBITA, and EBITA margin 2010-2014


29

39.0 44.0 44.9

-0.6

21.6

2010 2011 2012 2013 2014


EBITA (in MEUR)

EBITA margin (in %)

Average

580 MEUR

Average

594 MEUR

Average

30 MEUR

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