RELAUNCH

Frankfurt/Main, 21/22 Feb. 2018

ODDO BHF GERMAN CONFERENCE

2

GESCO  PROFILE

> € 500 millionGROUP SALES

~ 2,500EMPLOYEES WORLDWIDE 

36SITES WORLDWIDE

Future orientedend markets based on

MEGA TRENDS

PORTFOLIOCOMPANIES

17

„HIDDENCHAMPIONS“

TAKEOVER

100%

1989Founding

LONG‐TERMInvestor

UP TO 3Acquisitions

per year

INDUSTRIALGroup

German

„MITTELSTAND“

Market leaders & established players

PORTFOLIO

GROUPSEGMENTS

4

01IN BRIEF

3

SEGMENTS01IN BRIEF

Production process technology

Dynamically growing markets, high degreeof innovation, automation, „batch size 1“  Robotics and automation solutions in machine and plant construction, technology‐intense manufacturing services

Resource technology

Consolidating markets, focus on nichesand customer serviceCustomised preparation of primarymaterials, e. g. materials supply, transport and loading technology

Health and infrastructure technology

Not very cyclical, relatively resilient toeconomic fluctuationComponents, modules and primary productsfor providers for mass markets close to end customers

Mobility technology

Cyclical automotive market, positive outlook driven by technological leaps, e. g. electromobilityTools and moulds, components, parts etc. for vehicle industry

4

SHARE  PRICE DEVELOPMENT 5  YEARS01THE SHARE

GESCO Share (incl. div.) vs. SDAX and DAX (%)

SDAX  +124.4%

GESCO  +51.3%

DAX  +61.4%

12.02.2018€ 31.15

01.01.2013€ 22.68

80

100

120

140

160

180

200

220

240

5

90

100

110

120

130

140

150

160

170

180

SHARE  PRICE DEVELOPMENT YTDGESCO Share (incl. div.) vs. SDAX and DAX (%)

ANALYSTS‘ STATEMENTS

Bankhaus Lampe: 40.00 € / buy / 08.02.2018

Equinet: 35.80 € / accumulate / 08.02.2018 

Oddo BHF: 38.00 € / buy / 08.02.2018 

GSC Research: 41.00 € / buy / 21.11.2017 

SMC Research: 35.80 € / hold / 14.12.2017

GESCO  +38.1%SDAX    +22.2%DAX      + 5.9%

GESCO

SDAX

DAX

01THE SHARE

01.01.2017€ 22.55

12.02.2018€ 31.15

6

01PORTFOLIO

STRATEGY 2022

Starting pointLong‐standing successfulbusiness model had beenlosing momentumsince 2012/2013.

ActionIn 2016/2017 we set a lot of actions in motion in orderto lead GESCO back to the pathof profitable growth.

PORTFOLIO  STRATEGY 2022

RELAUNCHPORTFOLIOSTRATEGY

2022

7

PORTFOLIO  STRATEGY 2022Phase of analysis terminated

01ANALYSE SITUATIONAre our existing business model and our role as shareholders still suitable to achieve our goals?

DECISION Q1/2016• the business model had to be 

further developed in order to realize improvement potential

• GESCO had to take a more active part in its shareholder role

02ANALYSEMEGA TRENDSWhich markets are attractivefor us? 

DECISION Q1/2016• growth markets related to

mega trends• focus put on 4 end customer

market segments

03STRUCTURING OF SEGMENTSWhich competences arethe basis on which we shapeour future? 

DECISION Q2/2016• GESCO competences

identified• Portfolio reshaped into

4 Group segments• basis for focussed growth• strategy foresees up to 3 

acquisitions per year

04BENCHMARK FOREACH COMPANYHow do we secure leadingpositions and margines?

DECISION Q3/2016• Competitive benchmarking 

realised for each company• optimisation potential 

identified• support needs substantiated• resulting gaps quantified 

01PORTFOLIO

STRATEGY 2022

8

PORTFOLIO  STRATEGY 2022Optimizations started

DECISION Q4/2016• robust organization: 

placement of managingdirectors & key positions

• prioritization on investments for growth & competitiveness

• consultative support to the portfolio companies

05MANAGEMENT LEVERHow do we best fulfil ourduties as a shareholder?

DECISION 03‐04/2016• concrete actions developed 

and anchored in planning• focus on revenue growth and 

competitiveness• Increase cash flow through 

new focus on working capital

06GROWTH LEVERWhich mix of measures helps usto get better? 

DECISION 03‐04/2016• annual strategy meetings

used as kick‐off forstrategic planning

• ambitious 3 year targetsagreed with the Managing Directors

• consulting by portfoliomanagers in financial and technical topics & projects

07MANAGEMENT METHODHow can the holding generateadded value while maintaininghigh degrees of liberty? 

DECISION 03‐04/2016• cultural change has been

initiated• operational degrees of 

freedom have been retained• stronger focus on obligation 

and achievement have been put in place

08VALUES & CULTUREDEVELOPEDHow can we preserve valuesand at the same time developa strong culture of performanceand results?

01PORTFOLIO

STRATEGY 2022

9

ACQUISITION  2016/2017Profile Pickhardt & Gerlach Group

~ € 30 mSALES

41STAFF

A REFININGACQUISITION 

FIELD OFBUSINESS

processing of strip steelwith brass, copper, 

nickel & zinc

01M&A

CUSTOMER SECTORSelectronics, home accessories, interior fittings, packaging, office supply, household appliances, handicraft & DIY, furniture accessories, sporting goods, automotive

HIDDEN CHAMPION Leading supplier in Europe

USPs: QUALITY LEADER &

DEDICATED CUSTOMER SERVICE

high degree of automation, productiontechnology and sitestate of the art

SPECIALTY

SIGNING: DEC. 2016CLOSING: JAN. 2017

10

FINANCIAL  YEAR 2017/2018  ‐ Q1‐Q3Dynamic development in first nine months

• Business activity in capitalgoods industry has pickedup significantly

• PORTFOLIO STRATEGY 2022 in progress, optimisationprojects begin to showresults

• Portfolio strengthened by acquisition of Pickhardt & Gerlach Group, includedin P+L for the first time in current financial year

• Incoming orders and salesincreased significantly, earnings grewdisporportionately

• Negative one‐off effect due to decison of a companyto discontinue one of its divisions: € ‐2.0 m 

• Positive one‐off effect due to agreement on a tax issue: € +1.7 m 

• EBIT margin increasedfrom 5.4% to 7.5 %

• Impact of antitrustproceedings against Dörrenberg Edelstahl GmbH currently not quantifiable, not included in Q3 figures

• Q4 stronger than expected, order intake and sales still on a high level

• Operating guidance for full financial year significantly increased especially with respect to earnings

• Impact of antitrustproceedings against Dörrenberg Edelstahl GmbH not included in outlook 

02Q1‐Q3

11

FINANCIAL  FIGURES IN  DETAILQ1‐Q3

2016/2017 Q1‐Q3

2017/2018  Change Remark

Incoming orders €m 376.4 407.9 +8.4 % organic: +1.2 %

Sales €m 357.5 404.4 +13.1 % organic: +5.9 %

EBITDA €m 35.7 49.4 +38.6 %Disproportional growth, bettercapacity utilisation, temporaryfavourable order mix

EBIT €m 19.9 31.5 +57.7 %Earnings before tax €m 17.8 29.9 +67.7 %Group net income after minority interest €m 9.7 16.4 +68.2 %

Earnings per share pursuant to IFRS € 0.98 1.51 +54.1 % Disproportional developmentdue to higher no. of shares

Weighted average number of shares No. 9,969,471 10,832,475 +8.7 % Increase due to capital increasefrom March 2017 

Employees No. 2,526 2,482 ‐1.7 %PGW‘s staff included for the firsttime (37 employees), Protomaster‘sstaff no longer included (115) 

02Q1‐Q3

12

SEGMENT  DEVEL0PMENTSegment € m Q1‐Q3

2016/2017Q1‐Q3

2017/2018

PRODUCTION PROCESS TECHNOLOGY

Incoming orders 53.3 56.0 Lively customer demand; segment benefits from trendto automation; in Q3 increasing number of machinesdelivered

Sales 45.2 48.4EBIT 1.4 2.0

02Q1‐Q3

RESOURCETECHNOLOGY

Incoming orders 173.5 202.2 Extraordinarily strong Q1 with especially favourableenvironment, normalisation of margins on a high level in Q2 and Q3; Pickhardt & Gerlach included for the first time

Sales 166.4 205.4EBIT 13.7 27.8

HEALTH & INFRASTRUCTURETECHNOLOGY

Incoming orders 87.2 96.4Lively customer demand, segment benefits from positive development of markets close to end customers

Sales 87.8 96.6EBIT 8.7 9.5

MOBILITYTECHNOLOGY

Incoming orders 62.3 53.3 Good demand for parts for serial production, but toolmanufacturing clearly declining; negative one‐off effect of € ‐2.0 m because a portfolio company decided todiscontinue one of its divisions; segment developmentclearly lagging behind initial expectations; Protomaster GmbH sold on 7 Dec. 2017 via MBO

Sales 59.7 54.5

EBIT 3.4 ‐0.4

13

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

160.000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2016 2017

2017/2018  – Q4 (o p e r a t i n g b u s i n e s s O c t .   t o D e c .   2 0 1 7 )

O = order intake (left) € million S= Sales (right) € million

02Q4

Preliminary figures for Q4: better thanexpected, business activity still on a high level

ORDER BACKLOG END OF Q4:approx. € 195 m 

(without order backlog of Protomaster GmbH which had been sold in Dec. 2017)

144144

122 125

ORDER INTAKE Q4: +17% YOYSALES Q4: +15% YOY

SO S O

€‘000

14

OUTLOOK  2017/2018Expectations for full financial year

03OUTLOOK

FORECASTGerman GDP 2017+1,4% to +1,8%

VDMAProduction forecast

+3% after years of stagnation

ENVIRONMENTIMPROVED

1) as at annual accounts press conference on 29 June 2017        2) as at financial report H1 from 14 Nov. 2017 3 as at quarterly statement Q3 from 14 Feb. 2018     4) no. of shares increased due to capital increase from March 2017

Outlook raised significantly especially with regard to earnings

GESCO GROUP2016/2017

Actual

2017/2018Outlook6/2017 1)

2017/2018Outlook11/2017 2)

2017/2018Outlook2/2018 3)

Changeyoy

Group sales € m 482.5 510to 530 530 approx.

545 +13%

Group net incomeafter minority interest

€ m 7.9 17 to 18 18 20 

to 21+153% 

to +166%

Earnings per shareacc. to IFRS 4)

€ 0.79 1.57 to 1.66 1.66 1.84 

to 1.94+133% 

to +145% 

15

Ad‐hoc from 12.12.2017 Antitrust proceedings against 

Dörrenberg Edelstahl GmbH, a 90% subsidiary of GESCO. 

In‐depth analysis in progress.  Impact on earnings not yet 

quantifiable, therefore:  Impact not included in 

nine months figures 2017/2018  Impact not included in 

outlook for full FY 2017/2018 

OUTLOOK  2017/201803OUTLOOK

16

OUTLOOKExpected Segment Development for full FY

PRODUCTION PROCESSTECHNOLOGY

SalesSegment benefits from trend to automation,  sales and earnings expected above prev. year‘s figures

EBIT

RESOURCETECHNOLOGY

Sales Profitable organic growth plus strong external growthdue to addition of Pickhardt & Gerlach Group; sales and earnings expected clearly above prev. yearEBIT

HEALTH &INFRASTRUCTURETECHNOLOGY

Sales Benefits from lively demand of end customers; sales and earningsexpected above prev. year‘s figures, although earnings are burdenedby one‐off expenses for growth and optimisation projects in invidivualcompaniesEBIT

MOBILITYTECHNOLOGY

SalesSales and earnings are expected clearly below prev. year‘s level

EBIT

03OUTLOOK

17

GOALS  PORTFOLIO  STRATEGY 2022

GESCO PORTFOLIOleading GESCO back to the path of profitable growth by consistentlyimplementing measures in order

to reach the ambitious goals agreedwith the managing directors

INTERNALGROWTH

GESCO GROUPsustainably reaching thetargeted EBIT margin

by 2022

(corresponds to a margin of roughly4% of Group net incomeafter minority interest)

≥ 8%

EXTERNALGROWTH

GESCO ACQUISITIONSacquiring up to 3 Hidden Champions 

per year with intensifiedM&A activities

05Portfolio 

Strategy2022

03PORTFOLIO

STRATEGY 2022

18

APPENDIXShareholder Structure

13.7 % STEFAN HEIMÖLLER

(private investor, entrepreneur, supervisory board

member since 2013)

14.4 % INVESTMENTAKTIENGESELLSCHAFT FÜR LANGFRISTIGE INVESTOREN TGV (institutional investor, representedin supervisory board since 2017)

~36.0 %* other institutional investors

~35.9 %*other private investors

* estimate

86.3% FREEFLOAT

ACC. TO DEFINITION OF DEUTSCHE BÖRSE

19

APPENDIXSignificant GESCO Group companies

Segment Company/Group Sales 2016€‘000

Staff31.12.2016

ShareGESCO AG

PRODUCTION PROCESSTECHNOLOGY

C.F.K.  8,586 66 80%Georg Kesel Group 10,784 58 90%MAE Group  42,886 222 100%VWH 12,330 112 80%

RESOURCETECHNOLOGY

Dörrenberg Group  181,108 523 90%Pickhardt & Gerlach Group 29,500 41 100%SVT 41,035 184 90%

HEALTH &INFRASTRUCTURETECHNOLOGY

AstroPlast 12,993 85 100%Frank Group  29,993 285 90%Franz Funke 16,705 82 80%Haseke 13,760 69 80%Hubl 13,583 111 80%Setter Group  26,805 100 100%

MOBILITYTECHNOLOGY

Paul Beier 10,469 113 100%Dömer 15,229 100 100%Modell Technik 11,399 115 100%Werkzeugbau Laichingen Group  23,448 172 100%

20

Financial yearOPERATING COMPANIES

1st Jan 2017 31st Dec 2017Financial yearGESCO AG/GESCO GROUP

1st Apr 2017 31st Mar 2018

Please note: different financial yearAPPENDIX

21

APPENDIXGESCO Facts and Figures

FACTS AND FIGURES FOR GESCO AGFounded: 1989

Share capital: € 10,839,499 

Shares: 10,839,499 registered shares

Stock markets: Xetra; Frankfurt (regulated market); Berlin, Düsseldorf, Hamburg, Hannover, München, Stuttgart (open market)

Sec. Identification Number: A1K020

ISIN: DE000A1K0201

IPO: 24 March 1998 

End of financial year: 31 March 

Designated Sponsors: equinet Bank AGOddo Seydler Bank AG

22

FINANCIAL CALENDER14 February 2018 Q3 figures (01.04. ‐ 31.12.2017) 

21/22 February 2018  Oddo BHF German Conference, Frankfurt/Main

28 June 2018 Annual Accounts Press Conference / Analysts’ Meeting

14 August  2018 Q1 figures (01.04. ‐ 30.06.2018) 

30 August 2018 Annual General Meeting, Wuppertal  

14 November 2018 Q2 figures (01.04. ‐ 30.09.2018) 

APPENDIXFinancial Calender

23

APPENDIXInvestor Relations Contact

INVESTOR RELATIONS GESCO AG Phone:  +49 202 24820‐18 Investor Relations Fax:  +49 202 24820‐49Oliver Vollbrecht Email: info@gesco.deJohannisberg 7  Web: www.gesco.de 42103 WuppertalGermany

24

www.gesco.de