Klöckner & Co SE

A Leading Multi Metal Distributor

Commerzbank

Capital Goods & Steel ConferenceAugust 27, 2008 in Frankfurt

Gisbert RühlCFO

2

Agenda

2.

Strategy update

Appendix

3.

Market update

4.

Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

3

Klöckner & Co at a glance

CustomerKlöckner & Co

Klöckner & Co highlights

Products:

Services:

Producer

Construction:Structural SteelworkBuilding and civil engineering

Machinery/MechanicalEngineering

Others:Durable goodsMetal productsInstallationetc.

Leading producer-independent steel and metal distributor in the European and North American markets combined

Network with more than 260 distribution locations in Europe and North America

More than 10,000 employees

Key financials FC 2008-

Sales:

> €7 billion-

EBITDA:

> €500 million

4

Record results and ongoing

profitable growth

Highlights H1 2008 and until today

Extraordinary quarter and half year record results

Further expansion especially through the acquisition of Temtco in the US

Contract signed in July to sell KVT (CH) with high book gain

Sale of the automotive-related Canadian Namasco Ltd. concluded in July

Business optimization program “STAR” fully on track

Transformation of Klöckner & Co AG into a SE (Societas Europaea) completed

5

Agenda

2.

Strategy update

Appendix

3.

Market update

4. Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

6

Profitable growth

Grow more thanthe market

Continuous businessoptimization

1 Accretive

acquisitions driving market

consolidation and

2 STAR Program:-

Purchasing

-

Distribution network

Profitable growth through value-added distribution and services within multi metals to companies in Europe and North America

Profitable growth through value-added distribution and services within multi metals to companies in Europe and North America

7

Country Acquired Company Sales (FY)

Mar 2008 Temtco €226 millionJan 2008 Multitubes €5 million

2008 Ytd 2 acquisitions €231 millionSep 2007 Lehner

& Tonossi €9 millionSep 2007 Interpipe €14 millionSep 2007 ScanSteel €7 millionAug 2007 Metalsnab €36 millionJun

2007 Westok €26 millionMay 2007 Premier Steel €23 millionApr

2007 Zweygart €11 millionApr 2007 Max Carl €15 millionApr 2007 Edelstahlservice €17 millionApr 2007 Primary Steel €360 millionApr 2007 Teuling €14 millionJan 2007 Tournier €35 million

2007 12 acquisitions €567 million2006 4 acquisitions €108 million

€141 million

€567 million

Continued expansion through accretive acquisitions1

12

42

2005 2006 2007

Acquisitions Sales

>€600 million

2008

€108 million

8

Expected EBITDA contribution in 2008 from investments of about €260 million for acquisitions made in 2007

€90 - €100 million

Expected EBITDA contribution in 2008 from investments of about €130 million for acquisitions made in 2008 so far

€40 million (partially consolidated)

€55 million (annualized)

Continued expansion through accretive acquisitions1

9

Phase II (2008 onwards)

STAR program fully on track2

Phase I (2005 -

2008)

Overall targets:Central purchasing on country level, especially in GermanyImprovement of distribution networkImprovement of inventory management

2006:

~ €20 million2007:

~ €40 million2008:

~ €20 million~ €80 million

Upside potential

Overall targets:European sourcingOngoing improvement of distribution network

Upside potential

2008

~ €10 million2009:

~ €30 million2010:

~ €20 million~ €60 million

€16 million realized in H1

10

Agenda

2.

Strategy update

Appendix

3.

Market update

4. Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

11

Strong market development in Europe

Very strong price increasesGrowing underlying steel demand despite some weak local markets like Spain

SBB long prices - Europe domestic EUR/MT

300

400

500

600

700

800

900

CQ12005

CQ22005

CQ32005

CQ42005

CQ12006

CQ22006

CQ32006

CQ42006

CQ12007

CQ22007

CQ32007

CQ42007

CQ12008

CQ22008

Merchant Rebar Sections

MB flat prices - Europe domestic EUR/MT

300

400

500

600

700

800

900

CQ12005

CQ22005

CQ32005

CQ42005

CQ12006

CQ22006

CQ32006

CQ42006

CQ12007

CQ22007

CQ32007

CQ42007

CQ12008

CQ22008

HRC CRC HDG

12

Strong price development in North America

Very strong price increasesGrowing underlying steel demand remain weak

SBB long prices - North America domestic USD/MT

400

500

600

700

800

900

1.000

1.100

CQ12005

CQ22005

CQ32005

CQ42005

CQ12006

CQ22006

CQ32006

CQ42006

CQ12007

CQ22007

CQ32007

CQ42007

CQ12008

CQ22008

Merchant Rebar Heavy sections

SBB long prices - North America domestic USD/MT

400

500

600

700

800

900

1.000

1.100

CQ12005

CQ22005

CQ32005

CQ42005

CQ12006

CQ22006

CQ32006

CQ42006

CQ12007

CQ22007

CQ32007

CQ42007

CQ12008

CQ22008

Merchant Rebar Heavy sections

13

Positive steel market environment despite slowing demand

Demand will be effected by further slowdown in the EU mainly in Spain and UK, US economy will stay weakSteel prices are expected to peak in Q3Even if prices soften slightly in 2009 they will remain on a high level, supported by:

Normal inventory levelsLower Chinese exports High raw material costs which should support continuing supply disciplineHigh capacity utilization driven by world wide slower but robust demandIncreased pricing power of producers due to higher concentration in Europe and North America

Steel market will remain supply constrained

14

Agenda

2.

Strategy update

Appendix

3.

Market update

4. Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

15

Financial highlights Q2/H1 2008

290

321

3,582

3,475

H12008

87

103

1,650

1,663

Q2 2007

75.3166126.3197EBIT

65.0195107.0212EBITDA

12.03,19916.51,922Sales

5.53,2925.51,755Volume (Ttons)

Δ%H1 2007Δ%Q2

2008(€m)

16

Summary income statement Q2/H1 2008

(€m) Q22008

Q22007 Δ% H1

2008H1

2007 Δ%

Volume

(Ttons) 1,755 1,663 5.5 3,475 3,292 5.5Sales 1,922 1,650 16.5 3,582 3,199 12.0Gross profit% margin

46224.0

32819.8

41.021.2

80322.4

63519.8

26.413.1

EBITDA% margin

21211.0

1036.2

107.077.4

3219.0

1956.1

65.047.5

EBITFinancial result

197-17

87-52

126.3-67.9

290-34

166-63

75.3-46.1

Income before

taxes 180 35 419.1 256 103 149.4Income taxes -55 -12 372.6 -79 -33 137.3Minority interests 3 4 -18.4 5 10 -53.2Net income 122 19 538.2 173 59 191.6EPS

€

(basic) 2.63 0.41 541.5 3.72 1.28 190.6EPS

€

(diluted) 2.48 0.41 504.9 3.54 1.28 176.6

17

Underlying EBITDA again improved

Underlying EBITDA H1 2008

16.3

-30.1

46.5

130.3-

10.5-12.2

126.63.7

Δ

189.6

-10.3

199.9

188.2-

4.57.2

194.6-6.4

H12007

205.9

-40.4

246.4

318.5-82.115.0-5.0

321.2-2.7

H12008

Underlying EBITDA excluding Acquisitions

●

Acquisitions (LTM*)

Operating EBITDA●

Windfall effects●

Exchange rate effects●

Special expense effects

Underlying EBITDA

EBITDA as reported●

One-offs

(€m)

* LTM: Last twelve months

18

Includes acquisition-related sales of M€63 for H1 2008* in Europe and sales of M€226 for H1 2008* in North America

Segment performance H1 2008

Comments(€m) Europe North America

HQ/Consol. Total

Volume

(Ttons)H1 2008 2,434 1,041 - 3,475H1 2007 2,422 870 - 3,292Δ

% 0.4 19.7 - 5.5Sales

H1 2008 2,882 700 - 3,582H1 2007 2,713 486 - 3,199Δ

% 6.2 44.1 - 12.0EBITDA

H1 2008 234 93 -6 321% margin 8.1 13.3 - 9.0H1 2007 178 33 -16 195% margin 6.6 6.7 - 6.1Δ

% EBITDA 31.3 185.5 - 65.0* Sales of acquired companies for the first

twelve months of their consolidation

19

Balance sheet H1 2008

1,0721,6523,612

8581,3801,0431,376

8563,612

267124

1,2361,199

786

June 30, 2008

930Trade receivables956Inventories735Long-term assets

154Cash & cash equivalents191Other assets

610-

thereof trade payables969Total short-term liabilities

1,152Total long-term liabilities845Equity

2,966Total assets

813-

thereof financial liabilities

December 31, 2007(€m)

2,966Total equity and liabilities

746Net financial debt*1,323Net working capital*

Comments

Financial debt:•

Syndicated loan: €404 million

•

ABS: €322

million•

Bilateral credits: €195 million

•

Convertible: €275

million

Net Working Capital:•

Sales-, acquisition-

and price-driven

* Including Canada and KVT

20

Statement of cash flow

Comments(€m) H12008

H12007

Operating CF 317 188

Changes in net working capital -274 -303

Others -40 -25

Cash flow from operating activities 3 -140Inflow from disposals of fixed assets/others 8 15

Outflow from investments in fixed assets* -282 -366

Cash flow from investing activities -274 -351Changes in financial liabilities 296 531

Net interest payments -16 -51

Dividends -38 -45

Cash flow from financing activities 242 435

Total cash flow -29 -56

Operating CF more than fully covered the investments in net working capital

Investing CF mainly impacted by increased stake in Swiss Holding and acquisition of Temtco

CF from financing activities driven by acquisitions

*and acquisition of subsidiaries

21

Agenda

2.

Strategy update

Appendix

3.

Market update

4. Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

22

General financial targets/limits and guidance

125.2%< 150%Gearing (Net financial debt/Equity)

2.2x< 3.0xLeverage (Net financial debt/EBITDA LTM)

6.9%> 6%Underlying EBITDA margin*

12.0%> 10% p.a.Top line sales growth

ActualH1 2008

Generaltarget/limit

Challenging financial targets throughout the cycle

* According to new definition

23

Outlook 2008

For the full year 2008, we expect the following key figures:

Sales of more than €7 billion

EBITDA before one-offs of more than €500 million

Reported EBITDA including divestments of more than €770 million

Net income of more than €500 million

The raised outlook is based on record half year results and still overall favorable market environment for the steel distribution industry going forward despite a weaker global economic development and is supported by the following effects:

Additional EBITDA from STAR program

Positive contribution of additional EBITDA from acquisitions made in 2007 and in 2008

Further stock gains in the course of H2 2008

Outlook raised again –

2008 results far above 2007

24

Agenda

2.

Strategy update

Appendix

3.

Market update

4. Q2/H1 Financial review

5.

Targets and outlook

1.

Overview

25

October 14/15: Capital Market DaysNovember 14: Q3 Interim Report

Financial calendar 2008 and contact details

Financial calendar 2008

Claudia Nickolaus, Head of IRPhone: +49 203 307 2050Fax: +49 203 307 5025E-mail: claudia.nickolaus@kloeckner.deInternet: www.kloeckner.de

Contact details Investor Relations

26

Distributor in the sweet spot

Local customersGlobal suppliers

Suppliers Sourcing Products and services

Logistics/

Distribution Customers

Global Sourcing in competitive sizesStrategic partnershipsFrame contractsLeverage one supplier against the otherNo speculative trading

One-stop-shop with wide product range of high-quality productsValue added processing services Quality assurance

Efficient inventory managementLocal presenceTailor-made logistics including on-time delivery within 24 hours

> 210,000 customersNo customer with more than 1% of salesAverage order size of €2,000Wide range of industries and marketsService more important than price

Purchase volume p.a. of >6 million tonsDiversified set of worldwide approx. 70 suppliersExamples:

Klöckner & Co’s value chain

27

B D

F

E

CH ACZ

PL

LT

RO

NLCN

USA

GBIRL

More than 260 distribution locations in Europe and NA

USA 30 D/A 23 F/B 75 CH 35 E 54

GB 26 IRL 1 NL 5 Eastern Europe 13

BU

28

Largest independent multi metal distributor

Europe (2007)

Source:

company reports, own estimates

ArcelorMittal

(Distribution approx. 5%)

ThyssenKrupp

BE Group

Other

mill-tied

and independent distributors

11.1%

9.8%

6.4%

1.0%71.7%

Klöckner & Co

Source:

Purchasing Magazine (May 2008), own estimates

North America (2007)

Steel Technologies

Namasco

(Klöckner & Co)

Ryerson Reliance Steel

Samuel, Son & Co

ThyssenKrupp Materials NA

Worthington Steel

Carpenter Technology

McJunkin

O'Neal Steel

Mac-Steel

A.M. Castle

4.2%

2.8%

2.2%

2.2%

1.0%1.0%0.9%

1.3%

1.2%1.1%

1.3%

1.8%

1.7%

1.0%

5.1%

Other

71.2%

Russel

Metals

Metals USA

Structure: 50-60% through distribution, service centersSize in value: ~€100bnCompanies: ~1,300 only independent distributors

Structure: 67% through distribution, service centersSize in value: ~€71–91bnCompanies: ~3,000 few mill-tied, most independent

PNA Group

29

Broad industry, product and customer diversification

Other

GB

Construction

Machinery/Manufacturing

Auto-

motive

42%

25%

6%

27% 23%

21%

14%10%

5%

9%1%

13%

Germany/Austria

France/Belgium Spain

Nether-

lands

Eastern Europe

USA

Switzerland

Canada

4%Steel-flat Products

Steel-long Products

Tubes

Special and

Quality

Steel

Aluminum

Other Products

29%

30%10%

10%

7%

14%

Sales split by industry* Sales split by markets* Sales split by product*

*As of December

2007 *As of December

2007*As of December

2007

30

(€m) Q22008

Q1 2008

Q4 2007

Q3

2007

Q22007

Q12007

Q42006

Q32006

Q22006

Q12006

FY2007

FY2006

FY2005*

Volume (Ttons) 1,755 1,720 1,585 1,601 1,663 1,629 1,453 1,467 1,605 1,601 6,478 6,127 5,868

Sales 1,922 1,660 1,492 1,583 1,650 1,550 1,398 1,394 1,418 1,323 6,274 5,532 4,964

Gross profit 462 340 300 286 328 307 294 313 316 285 1,221 1,208 987

% margin 24.0 20.5 20.1 18.0 19.8 19.8 21.0 22.5 22.3 21.5 19.5 21.8 19.9

EBITDA 212 109 83 93 103 92 70 143 104 79 371 395 197

% margin 11.0 6.6 5.6 5.9 6.2 5.9 4.9 10.3 7.3 6.0 5.9 7.1 4.0

EBIT 197 93 65 76 87 78 55 128 89 64 307 337 135

Financial result -17 -17 -17 -17 -52 -10 -12 -24 -14 -14 -97 -64 -54

Income before taxes 180 76 48 59 35 68 43 105 75 50 210 273 81

Income taxes -55 -24 -6 -14 -12 -22 16 -20 -22 -13 -54 -39 -29

Minority interests 3 2 4 8 4 6 5 8 9 6 23 28 16

Net income 122 51 37 37 19 40 54 76 45 31 133 206 36

EPS basic (€) 2.63 1.09 0.80 0.79 0.41 0.86 1.16 1.64 0.97 - 2.87 4.44 -

EPS diluted (in €) 2.48 1.06 0.80 0.78 0.41 0.86 1.16 1.64 0.97 - 2.87 4.44 -

Quarterly results and FY results 2008/2007/2006/2005

*

Pro-forma consolidated figures for FY 2005, without release of negative goodwill of €139 million and without transaction costs of €39 million, without restructuring expenses of €17 million (incurred Q4) and without activity disposal of €1,9 million (incurred Q4).

31

Debt facilities

(€m) Old debtstructure

Change indebt structure

New debtstructure

ABS Europe 380 +40 420

ABS USA 60 +30 90

Total 440 +70 510

Syndicated loan - +600 600

Bilateral credit agreements 480 -100 380

Total senior bank facilities 480 +500 980

Convertible bond - +325 325

High yield bond 170 -170 -

Total facilities 1,090 +725 1,815

32

Steel cycle and EBITDA/cash flow relationship

Comments

Klöckner & Co buys and sells products at spot prices generallySales increase as a function of the steel price inflation environmentCost of material are based on an average cost method for inventory and therefore lag the steel price increaseThis time lag creates accounting windfall profits (windfall losses in a decreasing steel price environment) inflating (deflating) EBITDAAssuming stable inventory volume cash flow is impacted by higher NWC needsThe windfall profits (losses) are mirrored by inventory book value increases (decreases)

Theoretical relationship*

Windfall

profits

Windfall losses

(€m)

Margin

Margin

12

3

4

4

5

6 6

*Assuming stable inventory volumes

Steel price SalesCost of material EBITDACash flow

33

Geographical breakdown of identified institutional investors

Current shareholder structure

Comments

Identified institutional investors account for 74%

US based investors still dominate but share decreased in favor of UK (up from 14% as of Sept. 2007)

Top 10 individual shareholdings represent around 48%

Rest of World < 1% (geographical breakdown)

Retail share increased from 11% to almost 14%

Rest of Europe

US

United Kingdom

Germany

SpainSwitzerland

Source: Survey

Thomson Financial (as of Febr. 08)

20%

4%4%

24%

41%

7%

34

Our symbol

the earsattentive to customer needs

the eyeslooking forward to new developments

the nosesniffing out opportunities

to improve performance

the ballsymbolic of our role to fetch

and carry for our customers

the legsalways moving fast to keep up with

the demands of the customers

35

Disclaimer

This presentation contains forward-looking statements. These statements use words like "believes, "assumes," "expects" or similar formulations. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of our company and those either expressed or implied by these statements. These factors include, among other things:

Downturns in the business cycle of the industries in which we compete;Increases in the prices of our raw materials, especially if we are unable to pass these costs along to customers;Fluctuation in international currency exchange rates as well as changes in the general economic climate

and other factors identified in this presentation.In view of these uncertainties, we caution you not to place undue reliance on these forward-looking statements. We assume no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.