Klöckner & Co SE

A Leading Multi Metal Distributor

FY 2014 Results

Analysts’ and Investors’ Conference

CEO

Gisbert Rühl

March 5, 2015

CFO

Marcus A. Ketter

Disclaimer

This presentation contains forward-looking statements which reflect the current views of the management of

Klöckner & Co SE with respect to future events. They generally are designated by the words “expect”, “assume”,

“presume”, “intend”, “estimate”, “strive for”, “aim for”, “plan”, “will”, “strive”, “outlook” and comparable expressions and

generally contain information that relates to expectations or goals for economic conditions, sales proceeds or other

yardsticks for the success of the enterprise. Forward-looking statements are based on currently valid plans, estimates

and expectations. You therefore should view them with caution. Such statements are subject to risks and factors of

uncertainty, most of which are difficult to assess and which generally are outside of the control of Klöckner & Co SE. The

relevant factors include the effects of significant strategic and operational initiatives, including the acquisition or

disposition of companies. If these or other risks and factors of uncertainty occur or if the assumptions on which the

statements are based turn out to be incorrect, the actual results of Klöckner & Co SE can deviate significantly from those

that are expressed or implied in these statements. Klöckner & Co SE cannot give any guarantee that the expectations or

goals will be attained. Klöckner & Co SE – notwithstanding existing obligations under laws pertaining to capital markets –

rejects any responsibility for updating the forward-looking statements through taking into consideration new information

or future events or other things.

In addition to the key data prepared in accordance with International Financial Reporting Standards, Klöckner & Co SE is

presenting non-GAAP key data such as EBITDA, EBIT, Net Working Capital and net financial liabilities that are not a

component of the accounting regulations. These key data are to be viewed as supplementary to, but not as a substitute

for data prepared in accordance with International Financial Reporting Standards. Non-GAAP key data are not subject to

IFRS or any other generally applicable accounting regulations. Other companies may base these concepts upon other

definitions.

2

Klöckner & Co SE

A Leading Multi Metal Distributor

Highlights and update on strategyCEO

Gisbert Rühl

Highlights and update on strategy01

Financials

Outlook

Appendix

02

03

04

Agenda

4

Significantly improved results in 2014

• Steel markets improved by 3% in Europe and 4% in the US, whereas KCO shipments went up

only slightly by 2.4% to 6.6m tons – despite acquisition of Riedo – because of continued

reduction of low margin business

• Sales increased slightly less pronounced than shipments by 2.0% to €6.5bn mainly due to lower

price level in Europe

• Gross profit improved considerably stronger than sales by 6.1% to €1.261m. Gross margin

consequently up by 0.8%p to 19.4%

• Strong improvement of EBITDA from €124m to €191m and net income from -€90m to €22m

• Positive net income allows a dividend* payment of 20 cents per share

• Cash flow from operating activities with €50m once again significantly positive

• Successful acquisition of Swiss reinforcing steel specialist Riedo

• kloeckner.i as Group Center of Competence for digitalization founded in Berlin

• Further increase of EBITDA** expected for 2015, despite very weak Q1

01

5

* Dividend proposal to the Annual General Meeting.

** Outlook does not include any effects of further restructuring measures in France.

Self-help measures as main driver for significant EBITDA increase in 201401

• Self-help measures contributed €13m

to EBITDA against prior year in Q4,

FY €52m

• EBITDA contribution achieved

through KCO 6.0 amounted to

€7m in Q4, FY €36m

• KCO WIN impact of €6m in Q4,

FY €16m

• EBITDA margin improved by 0.9%p to

2.9% in FY 2014

Comments

6

12

8

7

6

31

16

KCO 6.0

Effect

GP Effect

Riedo

FX Price

Effect

FX OPEX

-9

OPEX

-11

KCO

WIN

Effect

EBITDA

2014

Price

Effect

2

Volume

Effect

0

EBITDA

2013

Market related GP effect: €2m

Self-help measures:

€13m

26

25

36 191

124

FX OPEX EBITDA

2014

GP Effect

Riedo

FX Price

Effect

7

Price

Effect

-45

KCO

WIN

Effect

16

-6

OPEX*Volume

Effect

8

EBITDA

2013

KCO 6.0

Effect

Market related GP effect: €34m* Including -€14m pension adjustment NL 2013 and -€13m Riedo.

Self-help measures:

€52m

KCO 6.0 EBITDA-impact

Q4

FY

“Klöckner & Co 2020“ growth strategy to drive the change01

7

Klöckner & Co 2020

Growth and

optimization

Differentiation

Operations

External & internal

growth

Digitalization

Products and

services

KCO WIN and further optimization of pricing

Focus on higher value-added business, regionally on the US market

Accelerated expansion of higher value-added products and services

Digitalization of the supply chain from suppliers to customers

1

2

3

4

Various initiatives to digitalize the supply and service chain in progress01

8

Digitalization

1• Efficient and comfortable ordering process

through new webshop

• Innovative tools create additional added value

for customers

• Comprehensive EDI connections with suppliers

• klockner.i as Group Center of Competence

established in Berlin

• Foundation of kloeckner.v as investment

company for start-ups initiated

• Ambitious digitalization targets

• Groupwide rollout of new webshop until

the end of the year

• Achieving more than 50% of sales online

by 2019

Digitalization also to gain from the long tail01

• Relevant market size of ~€100bn in Europe

• Little price sensitivity of target segment

• High retention rate of satisfied customers

• Relevant players are weakly positioned in

online marketing

• No real alternative to established players

• Customers require very large range of

(industrial) products (workwear, tools, fittings

etc.) which creates opportunities to integrate

with other players

Start of Klöckner Multi Metal Center in Q2High margins in the

long tail - 80% of

customers order at

list price

Machine & plant builder

Industrial companies

Craftsmen

Repair shops

Facility

manager

Private

DIY

Large

caps

Bu

yin

gp

ow

er

hig

hlo

w

Large

(250+ empl.)

Medium

(21-250 empl.)

Small

(1-20 empl.)

Customer size

9

Key facts European MRO market

Timeframe Impact

Business impact01

10

• Margin-optimized distribution of tasks and orders

• Massive decrease in capital lockup

• Uncatchable competitive advantage based on market penetration with digital services,

supplier/customer integration and open platforms

(e.g. Klöckner digital transaction platform)

Long-term

- 2020

Mid-term

- 2017

Short-term

- 2015

• New, digital connections between producers, suppliers and clients drive increased efficiency

and process optimization in existing value networks

(e.g. next-generation digital data interchange services with all participants)

• Massive decrease in transactions costs per order due to digitalization of sales and client

management processes (e.g. predictive sales, automated proposal generation)

• Optimization of order processes for online transactions

(e.g. webshop contract management platform and others)

• Increased customer satisfaction due to provided data and information

(e.g. customer portal, late delivery notice, e-mill-certificates)

• Rising EDI-connections with suppliers

1

Margin enhancement through higher value-add products and services01

11

Products and

services

2• Sales share of higher value-add products and services up from 30% to 34%

• Further increase of higher margin business to 45% of sales planed until 2017

• Expansion of investments in higher value add of roughly 50% in 2015

Actual Target

Effective

salesforce

management

• Advanced customer segmentation

• Structured sales approach

• Clear target-setting on all levels with mid- and long-term development of accounts

• Sales performance tracking and regular performance reviews

• Target-oriented incentive schemes

• Continuous sales staff training

Effective

sourcing,

logistics and

warehouse

management

• Further bundling, special deals and increase of bonus yields

• Introduction of paperless warehouse processes

• More usage of state of the art warehouse technology

Minimum pricing

Dynamic pricing

Optimization program KCO WIN with focus on improved pricing01

12

Measures

Optimized pricing• Value based pricing

• Ongoing price optimization

• Pricing based on profitability

• Pricing metrics and review

2014

2015 €24m

Total annual EBITDA-impact of ~€40m from 2015 onwards

€16m

Current

focus

Operations

3

• Pricing depending on market conditions

• Pricing tool with algorithm

Improved pricing

Acceleration of profitable growth01

13

• Regional growth focus on US due to better outlook

• Continuing strong growth of steel demand driven by automotive and

recovery of construction

• External growth in high-margin activities back on the agenda

• Successful takeover of Swiss reinforcement steel specialist Riedo as first

acquisition after completed restructuring

• Companies with higher value-add service capabilities are of particular interest

• Healthy balance sheet and financing create room for maneuver

External & internal

growth

4

Mid-term EBITDA margin target of >5% until 201701

14

>5%

2017 EBITDA

margin

Digitalization

products &

services

Pricing

incl. remaining

KCO WIN effects

2014 EBITDA

margin

2.9%

>1%>0.5%

>0.5%

Higher value add

Klöckner & Co SE

A Leading Multi Metal Distributor

FinancialsCFO

Marcus A. Ketter

Highlights and update on strategy01

Financials

Outlook

Appendix

02

03

04

Agenda

16

Shipments and sales02

17

Sales (€m)Shipments (Tto)

• Increase yoy driven by Riedo

• Shipments decreased qoq following the usual

seasonal pattern

• yoy increase includes Riedo and volume effects

• Sales decline qoq less pronounced than

shipments due to stronger USD

1,5851,646 1,690

1,6171,492

1,6331,720 1,690

1,555

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

1,633 1,625

1,698

1,600

1,455

1,572

1,680 1,675

1,577

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

+4.2%

-8.0%

+8.4%

-5.8%

Gross profit and EBITDA02

18

EBITDA* (€m) / EBITDA margin* (%)Gross profit* (€m) / Gross margin* (%)

• Gross margin improved continously quarter by

quarter up to 19.6% in Q4

• EBITDA continues to benefit from KCO 6.0

measures and from KCO WIN

• EBITDA margin up by 0.5%p in 2014* Before restructuring costs.

302 303305

296

288

302

325 325

309

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

22

29

43

39 40

45

5659

31

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

18.7 FY

17.5 FY

19.4 FY

2.4 FY

1.8 FY

2.9 FY

XX Segment performance (shipments and sales)02

19

• Shipments

• Europe up by 5.0% mainly due to Riedo acquisition

(+3.8%p)

• Americas down by 1.0% mainly due to unfavorable

market development in Brazil

Sales (€m)

Comments

• Sales

• In Europe up by 2.0% due to Riedo

• Americas segment up by 1.9% due to favorable price

development in US

+2.0%

+1.9%

6,445

2,832

3,613

2.4%

Americas

Europe

2,804

FY 2013

6,598

3,794

FY 2014

+5.0%

-1.0%

6,378

4,101

FY 2013

4,019

2,359 2,403

Europe

6,504

+2.0%

Americas

FY 2014

Shipments (Tto)

Segment performance (gross profit and EBITDA)02

20

• Focus on higher margin business visible in both

segments

• Europe

• Gross margin up by 0.8%p to 20.5%

• EBITDA margin up by 0.4%p to 2.6%

• Americas

• Gross margin up by 0.7%p to 17.5%

• EBITDA margin up by 1.6%p to 4.2%

Gross profit (€m) Comments

EBITDA (€m)

792 841

420

FY 2013 FY 2014

1,2611,188

Americas

+6.1%

Europe

396

+6.2%

+6.0%

-17-26

60100

108

FY 2014

191

+53.3%

HQ/Consol.

Americas

Europe

FY 2013

124

90

+20.6%

+66.0%

Cash flow and net debt development02

Cash flow reconciliation in 2014 (€m)

• Only minor NWC build-up of €20m

• “Other” include changes in provisions and

other operating assets/liabilities as well as

non-cash items including gain on sale in

assets

• Acquisitions relate to Riedo only

• Capex at the level of depreciation

Comments

36

Development of net financial debt in 2014 (€m)

21

• Net debt increased from €325m to €472m

despite positive operating cash flow

• Settlement of a hedging instrument (CCS*)

burdened net debt with €29m

• “Other” include f/x (€15m) and accrued

interest

50

82

Capex

(net)

-50

M&A

-82

Cash

flow from

operating

activities

Other

191

EBITDA

2014

-20

Change

in NWC

-44

Interest

-18

Taxes

-59

Free

cash flow

2014

50

CF from

operating

activities

472

Net Debt

2014Other

-36

Settlement

CCS*

-29

Capex (net)

-50

M&A

-82

Net Debt

2013

325

* CCS = Cross Currency Swap

• Equity ratio further solid at 39%

• Net debt of €472m

• Gearing* at 34%

• NWC increased from €1,216m to €1,321m yoy

Strong balance sheet02

* Gearing = Net debt/Equity attributable to shareholders of

Klöckner & Co SE less goodwill from business

combinations subsequent to May 23, 2013.

Comments

22

Assets

316595

746

687

977

3,595

Inventories

1,103

1,166

146

Other current assets

3,629

Non-current assets

Liquidity

170

Trade receivables

1,318

348366

743637

328236

781911Financial liabilities

Trade payables

3,629

Equity 1,445

Other liabilities

Pensions

1,429

3,595

Equity & liabilities

40% 39%

Dec 31, 2014Dec 31, 2013 Dec 31, 2013 Dec 31, 2014

Klöckner & Co SE

A Leading Multi Metal Distributor

OutlookCEO

Gisbert Rühl

Segment specific business outlook 201503

24

US

Steel demand

Construction industry

Automotive industry

Manufacturing, machinery and

mechanical engineering, etc.

Europe

+1-2% +3-4%

Outlook*03

25

• Q1 2015

• Sales to be sequentially up in Q1

• Strong steel price erosion in the US, FX-related margin pressure and potential inventory write

downs in Switzerland as well as further deterioration of construction in France with strong

negative impact on earnings

• Comparable operating EBITDA expected in a range between €15m and €25m

• Additional negative impact on EBITDA at a mid-single-digit million Euro amount (not included in

guidance) compared to Q1 2014 due to new accounting regulation IFRIC 21 (one time recognition

of levies other than spread over 12 months)

• FY 2015

• Sales to be slightly up; negative effect of anticipated lower steel price level to be

overcompensated by volume growth

• Further increase of EBITDA expected driven by internal measures

• Acquisitions in companies offering higher value-added products and processing planned

• Investments in start-ups to advance digitalization strategy intended

* Outlook does not include any effects of further restructuring measures in France.

Highlights and update on strategy01

Financials

Outlook

Appendix

02

03

04

Agenda

26

Quarterly results and FY results 2011-201404

27

(€m)Q4

2014

Q3

2014

Q2

2014

Q1

2014

Q4

2013

Q3

2013

Q2

2013

Q1

2013

FY

2014

FY

2013

FY

2012*

FY

2011

Shipments (Tto) 1,555 1,690 1,720 1,633 1,492 1,617 1,690 1,646 6,598 6,445 7,068 6,661

Sales 1,577 1,675 1,680 1,572 1,455 1,600 1,698 1,625 6,504 6,378 7,388 7,095

Gross profit 309 325 325 302 284 296 305 303 1,261 1,188 1,288 1,315

% margin 19.6 19.4 19.3 19.2 19.5 18.5 18.0 18.6 19.4 18.6 17.4 18.5

EBITDA 31 59 56 45 16 36 43 29 191 124 60 217

% margin 2.0 3.5 3.3 2.9 1.1 2.3 2.5 1.8 2.9 2.0 0.8 3.1

EBIT 6 36 33 23 -36 10 17 2 98 -6 -105 111

Financial result -13 -14 -16 -17 -17 -19 -19 -19 -59 -73 -80 -84

Income before taxes -6 22 17 6 -52 -8 -2 -16 39 -79 -185 27

Income taxes 1 -7 -7 -3 -7 -3 -2 1 -17 -12 -18 -17

Net income -5 15 10 3 -59 -11 -4 -16 22 -90 -203 10

Minority interests -1 0 0 0 -5 0 0 0 0 -6 -3 -1

Net income KlöCo -5 15 10 3 -54 -11 -4 -16 22 -85 -200 12

EPS basic (€) -0.05 0.15 0.10 0.03 -0.54 -0.11 -0.04 -0.16 0.22 -0.85 -2.00 0.14

EPS diluted (€) -0.05 0.15 0.10 0.03 -0.54 -0.11 -0.04 -0.16 0.22 -0.85 -2.00 0.14

* Restated due to initial application IAS 19 revised 2011.

Both regions recovering from their profitability lows04E

uro

pe

Am

ericas

28

Shipments (Tto) Sales (€m) EBITDA* before restructuring (€m)

Shipments (Tto) Sales (€m) EBITDA before restructuring (€m)

* 2012: as restated for the initial application of IAS19 revised 2011.

Restructuring costs (€m) Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q3 2013 Q4 2013

Europe 10 3 17 -1 57 13

Americas 1 2 11 ** Including pension release: Q2 2013 €7m, in Q3 2013 €6m and Q4 2013 €1m

and sale of French La Courneuve site €13m.

908

930941

903

839

956

987

957

893

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

1,041

1,017

1,061

1,006

935

1,015

1,072

1,041

973

Q4

2012

Q1

2013

Q2

2013

Q3

2013

Q4

2013

Q1

2014

Q2

2014

Q3

2014

Q4

2014

1614

2826

34

26

32 33

17

Q42012

Q12013

Q2**2013

Q3**2013

Q4**2013

Q12014

Q22014

Q32014

Q42014

16

21 20 20

13

24

28 29

19

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

592 608637

594

520557

608634

604

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

677

716

749

714

653

677

733 733

662

Q42012

Q12013

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

+6.4% +4.0%

+1.4%+16.3%

Balanced maturity profile December 201404

29

Maturity profile of committed facilities and drawn

amounts (€m)

€m Facility CommittedDrawn amount (IFRS)

FY 2014* FY 2013*

Bilateral Facilities 1) 576 101 62

ABS 587 221 191

Syndicated Loan 360 101 161

Promissory Note 185 187 238

Total Senior Debt 1,708 610 652

Convertible 2009 2) 0 0 98

Convertible 2010 2) 186 178 171

Total Debt 1,894 788 921

Cash 316 595

Net Debt 472 325

€m FY 2014

Adjusted equity 1,395

Net debt 472

Gearing 3) 34%

* Including interest accrued.

1) Including finance lease.

2) Drawn amount excludes equity component.

3) Net debt/Equity attributable to shareholders of Klöckner & Co SE less goodwill from business

combinations subsequent to May 23, 2013.

Left side: committed facilities Right side: drawn amounts

186 133133

360

587

268

24241616

2015

52

466

221

186

2018

228

52

338

16

2017

151

1,231

Thereafter

157

16

100

2016

18

2264

24

Bilaterals Syndicated loanABS Promissory notes

US ABL

Convertibles

Comments

Balance sheet as of December 31, 201404

30

(€m) December 31, 2014 December 31, 2013

Non-current assets 1.103 977

Inventories 1.318 1.166

Trade receivables 746 687

Other assets 146 170

Cash & Cash equivalents 316 595

Total assets 3.629 3.595

Equity 1.429 1.445

Total non-current

liabilities1.001 1.077

thereof financial liabilities 522 727

Total current liabilities 1.199 1.073

thereof trade payables 743 637

Total equity and

liabilities3.629 3.595

Net working capital 1.321 1.216

Net financial debt 472 325

Shareholders’ equity:

• Healthy at 39%

Financial debt:

• Gearing at 34%

• Gross debt of €0.8bn and

cash position of €0.3bn

result in a net debt position

of €472m

Profit & loss 201404

(€m) FY 2014 FY 2013

Sales 6,504 6,378

Gross profit 1,261 1,188

Personnel costs -590 -579

Other operating expenses (net) -480 -485

EBITDA 191 124

Depreciation & Amortization -93 -130

EBIT 98 -6

Financial result -59 -73

EBT 39 -79

Taxes -17 -12

Net income 22 -90

Minorities 0 -5

Net income attributable to KCO shareholders 22 -85

31

Sales by markets, products and industries04

32

As of December 31, 2014

Sales by markets Sales by industry

Sales by product

Current shareholder structure04

33

Geographical breakdown of identified

institutional investors• Identified institutional investors

account for 60%

• German investors incl. retail

dominate

• Top 10 shareholdings represent

around 35%

• Retail shareholders represent 28%

As of February 2015

Rest of World 7%

Rest of EU 3%

US 46%

Switzerland 4%

France 9%

Germany 24%

UK 7%

Comments

Appendix04

34

Contact details Investor Relations

Christian Pokropp, Head of Investor Relations & Corporate Communications

Phone: +49 203 307 2050

Fax: +49 203 307 5025

Email: christian.pokropp@kloeckner.com

Internet: www.kloeckner.com

Financial calendar 2015

March 5, 2015 Annual Financial Statements 2014

May 7, 2015 Q1 interim report 2015

May 12, 2015 Annual General Meeting 2015, Düsseldorf

August 6, 2015 Q2 interim report 2015

November 5, 2015 Q3 interim report 2015

Our Symbol

the ears

attentive to customer needs

the eyes

looking forward to new developments

the nose

sniffing out opportunities

to improve performance

the ball

symbolic of our role to fetch

and carry for our customers

the legs

always moving fast to keep up with

the demands of the customers