Bekaert Investor Presentation

October 2020

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt management

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

2

Investor presentation - Bekaert

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt management

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

3

Investor presentation - Bekaert

Bekaert in brief

Founded in 1880 by Leo Leander Bekaert

The world's largest independent producer of steel wire products and solutions

Serving customers from a very wide range of industry sectors in 120 countries and operating a global manufacturing platform with 28 000 employees worldwide

Combined sales of € 5.1 billion and consolidated sales of € 4.3 billion (2019)

Listed on Euronext® Brussels

Bekaert in your day-to-day life…

We're present in a very wide range of applications

30% of all tires around the world are reinforced with Bekaert tire cord

Every year, 10 million m³ of concrete is being reinforced with Dramix® steel fibers

Bekaert's customers use 3.5 million kilometer of bookbinding wire per year

Over 1 billion bottles are uncorked annually by removing the muselet made of Bekaert steel wire

5

Investor presentation - Bekaert

High-tech solution provider

surfing the waves of megatrends

Bekaert develops sustainable materials for future mobility. Ever stronger and thinner tire cords enable lightweight tire design. Ultra-thin metal fibers are a core material of sensor technologies.

We develop innovative steel and synthetic mooring solutions for floating offshore wind turbines and our a-magnetic armoring wire protects submarine power cables against corrosion and energy losses.

Our high-tech solutions for realizing vertical cities include A-cords for elevators, ultra-thin metal fibers to manufacture scratch-free smart glazing, Dramix® steel fibers for concrete reinforcement and Murfor® Compact masonry reinforcement.

Based on our ultra-thin metal fiber technologies we develop the core elements of carbon-freehydrogen-fueled heating systems and hydrogen power stations.

6

Investor presentation - Bekaert

Ambitions and actions

for a sustainable future

We conduct and grow our business in a sustainable way so that our employees, customers, shareholders, business partners, and communities all benefit. Our commitment to drive value takes into account the broader environmental and social impacts of our operations, with clear responsibility:

for our people: we act with integrity

  • commit to the highest standards of business ethics. We promote equal opportunity, foster diversity and we create a no-harm-to- anyone work environment globally.

for the environment: we develop equipment that reduces energy consumption and optimizes recycling. We use renewable energy sources wherever possible and we don't discharge untreated effluents & waste.

in our markets: we promote and apply responsible business practices in all our relationships. Our sourcing and innovation programs enhance sustainability improvements throughout the value chain.

to society: we support and develop initiatives that help improve the social conditions in the communities where we are active. Education programs form the backbone of our social funding.

7

Investor presentation - Bekaert

Bekaert global presence

Bekaert production plants

Bekaert offices

Bekaert Technology Centers

BBRG production & distribution sites

8

Bekaert technological leadership

€ 70 million

International R&D teams in

About 1800

R&D in 2019

Belgium - China - India - UK

patent rights

Co-creation with customers and suppliers

Outward orientation

• internationalization of technologists

• cooperation with internationally renowned research centers & universities

• venture capital and R&D partnerships

Intellectual property protection

9

Investor presentation - Bekaert

Bekaert core competencies

steel wire transformation

from wire rod

drawing, bunching, cabling,

to metal fibers

6.5 mm

profiling, welding,

1 µm

knitting, weaving…

coating technologies

from traditional

adhesion

to advanced

coatings

corrosion resistance

coatings

wear resistance

anti-fouling

10

Investor presentation - Bekaert

Bekaert market leadership in diverse sectors - combined sales (FY2019)

46%

18%

8%

8%

7%

7%

6%

Tire & Automotive

Construction

Agriculture

Energy & utilities

Consumer goods

Basic materials

Equipment

Bekaert has a strong presence in diverse sectors. This makes Bekaert less sensitive to sector- specific trends and it also benefits our customers, because solutions we develop for customers in one sector often form the basis of innovations in others.

11

Investor presentation - Bekaert

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt maturity profile - Net debt leverage

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

12

Investor presentation - Bekaert

Executive Leadership team

Four Business Units:

Divisional CEO

Divisional CEO

Divisional CEO

Divisional CEO

Rubber Reinforcement

Steel Wire Solutions

Specialty Businesses

Bridon-Bekaert Ropes Group

Arnaud Lesschaeve

Stijn Vanneste

Jun Liao

Curd Vandekerckhove

Four Global Functional Domains:

CEO ad interim

Oswald Schmid

Chief Financial Officer

Chief HR Officer

Chief Strategy Officer

Chief Operations Officer

Taoufiq Boussaid

Rajita D'Souza

Juan Carlos Alonso

Oswald Schmid

13

Investor presentation - Bekaert

Segmentation and sectorial breakdown

(consolidated sales H1 2020)

Rubber Reinforcement (RR)

Steel Wire Solutions (SWS)

Specialty Businesses (SB)

Tire cord, bead wire, hose

Steel wire products and

Building products, fiber

reinforcement wire and

solutions serving industrial,

technologies, combustion

conveyor belt

agricultural, consumer and

technology and sawing wire

reinforcement

construction markets

Bridon-Bekaert Ropes Group

(BBRG)

Ropes and advanced

cords businesses

6%

6%

2%

10%

9%

14%

27%

9%

69%

30%

15%

40%*

36%*

11%

10%*

13%*

15%

20%

19%

94%

10%

26%

8%

11%36%4

Construction

Agriculture

Consumer Goods

Tire & Automotive

Energy & Utilities

Basic Materials

Equipment

Other

The sectorial mix in H1 2020 was impacted by COVID-19: tire & automotive sales were down, while the agriculture, energy & utilities, and mining (basic material) sectors were more resilient.

14

Investor presentation - Bekaert

-

*BU share in the consolidated revenue over the 1st Half of 2020

Rubber Reinforcement

Combined revenue data FY2019

15

Investor presentation - Bekaert

Steel Wire Solutions

Combined revenue data FY2019

Combined revenue per sector - 2019

16

Investor presentation - Bekaert

Specialty Businesses

Revenue data FY2019

19 sites

Revenue per sector - 2019

17

Investor presentation - Bekaert

Bridon-Bekaert Ropes Group

Revenue data FY2019

2 450

15

Revenue per sector - 2019

18

Investor presentation - Bekaert

2020 H1 Sales

Consolidated sales

2019

2020

Share

Variance

Organic

FX

Rubber Reinforcement

1 014

709

40%

-30%

-30%

-

Steel Wire Solutions

751

639

36%

-15%

-12%

-3%

Specialty Businesses

202

185

10%

-9%

-8%

-1%

BBRG

242

229

13%

-6%

-4%

-2%

Group

10

9

-

-

-

-

Total

2 218

1 770

100%

-20%

-19%

-1%

Combined third party sales

2 619

2 065

100%

-21%

-17%

-4%

19

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt maturity profile - Net debt leverage

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

20

Investor presentation - Bekaert

H1 2020

Bekaert counters significant impact of Covid-19 through effective mitigating measures and performance improvements

The turnaround of SWS and BBRG

and the effectiveness of implemented measures moderate the impact of Covid-19 on the Rubber Reinforcement business

Market developments and Covid-19 impact in the first half of 2020

  • Demand from tire and automotive markets
    • Hit hard, first in China and quickly followed in the rest of the world
    • Up to -30% drop in global car/truck production over the first half
    • Global tire demand reduction: -40% on average in Q2 ; lowest point in April
  • Construction and infrastructure markets
    • Held up relatively well in the first quarter of 2020
    • Constrained by lockdowns in Q2: up to -20% (depending on the region)
    • Stimulus programs start to boost infrastructure investment in China
  • Demand from agriculture, utility, and mining markets
    • Remained relatively solid throughout the first half (up to -10% impact)
    • Currently less affected by the Covid-19 pandemic
    • Considered 'essential industries'

Main applications

Tire cord Bead wire

Heat resistant textiles Micro-cables Window regulator cord

Dramix fibers Masonry reinforcement Construction strand & ropes Welded mesh

Elevator hoisting cords Burners & heat exchangers

Agri fencing solutions

Power cable armoring

Conductor strands

Mining ropes

22

Our response

Health

& Safety

  • Early, rigorous measures to limit infection risks
  • Awareness among team members and their families
  • Early promotion of smart working

Customer

Liquidity

Profit

Centricity

& Cost

Restoration

Close contact to

Strict control on

Acceleration of the

understand current and

working capital and

turnaround of SWS

future needs

cash collection risk

and BBRG

Ensure customers do

Stringent capex and

Robust improvement

not suffer from supply

cost control + flexing

in business mix and

interruptions

of fixed cost

margins

Reinforce digital tools

Positive cash flows

Impactful mitigating

and practices

and strong liquidity

actions

Supply

Chain Mgt

  • Secured supplies of critical products to avoid interruptions
  • Adequate sourcing activities aligned with sales evolution
  • Global virtual supplier campaign
  • Effective governance and coordination in aligning decisions and actions in managing this crisis
  • Communication streams and channels across the business and the regions
  • Focus on emerging stronger from the crisis and anticipating risk and opportunity in our markets and in our business

23

H1 2020 Financial Highlights

  • Underlying EBIT margin of 5.2% (5.7% H1 2019) on a revenue decrease of -20%
  • Robust performance improvement SWS and BBRG - SB remaining strong - RR significantly affected
  • Proactive actions and mitigating response to Covid-19: reduction of cost and working capital
  • Stronger business mix
  • Very strong liquidity: € 834 million euro cash on hand, doubling 30 June 2019 levels
  • Debt leverage at 2.5x underlying EBITDA, slightly below H1 2019 (2.6x)

Sales

uEBIT

Measures

Business mix

Liquidity

-20%

5.2%

cost - capex

stronger

x2

working capital

24

H1 2020 Financial Highlights

H1

2019

2020

yoy

%

Sales

2 218

1 770

-448

-20%

EBITDA-underlying

239

194

-45

-19%

EBIT-underlying

126

92

-34

-27%

% EBITDA-underlying

10.8%

11.0%

+0.2pp

+2%

% EBIT-underlying

5.7%

5.2%

-0.5pp

-9%

Working Capital

956

720

-236

-25%

Net Financial Debt

1 253

955

-298

-24%

Net debt on EBITDA-underlying

2.6

2.5

-0.1pp

-4%

25 In millions of € unless otherwise indicated

EBIT-Underlying bridge

130

6

-2

110

90

30

70

126

-

17

50

92

30

18

10

34

-10

EBIT Underlying

Inventory Valuation

FX effects

COVID 19

COVID 19

business mix

cost + overheads

EBIT Underlying

2019.06

volume + cost

mitigation

2020.06

external levers

internal levers

26

EBIT-Underlying bridge by Business Unit

27

Rubber Reinforcement: significantly affected by Covid-19 impact on tire & automotive markets in Q2

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Consolidated third party sales

1 014

709

1 014

709

Consolidated sales

1 031

725

1 031

725

Gross profit

126

55

123

54

EBIT

94

28

91

27

EBIT margin

9.1%

3.9%

8.8%

3.7%

EBITDA

157

81

154

79

EBITDA margin

15.3%

11.1%

15.0%

10.9%

ROCE

13.6%

4.7%

13.2%

4.5%

  • Consolidated sales contracted by -30% or € -300 million.
  • Volumes decreased by -25%(-36% in Q2) and the impact of passed-on wire rod price changes and other price-mix effects was -5%.
  • Gross profit was -56% below H1 last year.
  • Underlying EBIT decreased by € -65.5 million, resulting in a margin on sales of 3.9%.
  • Underlying EBITDA margin of 11.1%

28

Steel Wire Solutions: robust profit improvement on lower sales

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Consolidated third party sales

751

639

751

639

Consolidated sales

778

655

778

655

Gross profit

82

93

82

93

EBIT

28

40

26

39

EBIT margin

3.5%

6.0%

3.4%

5.9%

EBITDA

55

67

53

64

EBITDA margin

7.1%

10.2%

6.9%

9.8%

ROCE

7.9%

13.7%

7.6%

13.4%

  • Steel Wire Solutions reported -15% lower consolidated sales. This stemmed from a volume decline of -11%,passed-on wire rod price changes and other price-mix effects (-1%) and unfavorable currency movements (-3%).
  • Gross profit increased by 12.6% to € 93 million due to an improved business mix and footprint optimization, stringent cost control, and impactful Covid-19 mitigation actions.
  • Underlying EBIT increased by +44% to reach a solid margin on sales of 6% and underlying EBITDA improved accordingly to a double- digit margin of more than 10%.

29

Specialty Businesses: continued strong profit contribution

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Consolidated third party sales

202

185

202

185

Consolidated sales

208

188

208

188

Gross profit

60

57

54

56

EBIT

25

24

18

23

EBIT margin

12.0%

12.9%

8.6%

12.0%

EBITDA

33

31

27

30

EBITDA margin

15.7%

16.6%

13.2%

15.7%

ROCE

20.7%

20.1%

14.7%

18.7%

  • Specialty Businesses reported a decrease of -8.5%in sales, driven by lower demand in the second quarter, both in Building Products (-10%) and Fiber Technologies (-10%). Combustion Technologies reported a moderate decrease and sales in Sawing Wire activities remained limited.
  • Underlying EBIT was slightly below last year but the margin on sales improved to 12.9% and the underlying EBITDA margin increased to a robust 16.6%.

30

Bridon-Bekaert Ropes Group (BBRG): exceptionally strong step-up in performance

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Consolidated third party sales

242

229

242

229

Consolidated sales

244

230

244

230

Gross profit

41

50

43

50

EBIT

6

24

8

24

EBIT margin

2.6%

10.3%

3.4%

10.3%

EBITDA

19

39

19

39

EBITDA margin

8.0%

17.2%

7.9%

17.2%

ROCE

2.6%

10.0%

3.4%

10.0%

  • BBRG reported a sales decline of -5.6%, driven by lower volumes. Part of the volume decrease was a result of BBRG's strategy to reduce its presence in lower margin applications.
  • The business unit delivered an underlying EBIT of € 24 million, four times the result of the same period last year and reaching an underlying EBIT margin on sales of 10.3% (versus 2.6% in the same period last year). Underlying EBITDA reached an exceptionally strong margin of 17.2%.

31

Consolidated income statement: key figures

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Sales

2 218

1 770

2 218

1 770

Cost of sales

(1 909)

(1 518)

(1 916)

(1 521)

Gross profit

309

252

302

249

  • Sales decreased by -20.2%:
    • -17.7%organic volume decline (-26.5% in Q2)
    • -1.1%passed-on wire rod price changes and other price-mix elements
    • -1.4%unfavorable impact of exchange rate movements
  • Underlying Gross profit decreased by € -56.7million (-18.3%) but increased as a margin on sales to 14.3% (13.9% in H1 last year):
    • adverse cost of sales and margin impact from a significant decrease in volumes
    • positive mix effects from growth in good margin businesses
    • robust progress in the profit restoration of BBRG and Steel Wire Solutions
    • mitigation actions in response to COVID-19 impact
    • unfavorable impact from currency movements

32

Consolidated income statement: key figures

(in mio €)

Underlying

Reported

H1 2019

H1 2020

H1 2019

H1 2020

Gross profit

309

252

302

249

Selling expenses

(88)

(81)

(89)

(81)

Administrative expenses

(70)

(59)

(71)

(60)

R&D expenses

(33)

(25)

(33)

(26)

Other operating revenue and expenses

8

4

7

4

EBIT

126

92

115

87

EBIT margin

5.7%

5.2%

5.2%

4.9%

EBITDA

239

194

226

188

EBITDA margin

10.8%

11.0%

10.2%

10.6%

  • Overheads decreased by € -25.9 million.
    • full impact of restructuring and structural savings actions implemented in the second half of 2019
    • mitigation actions taken in response to COVID-19 (€ -17.6 million)
  • Underlying EBIT decreased by € -34.5 million to € 91.5 million
  • Underlying EBIT margin on sales was 5.2%, a relatively slight decrease on 20% lower sales.
  • Underlying EBITDA margin improved to 11.0%.

33

Other information

  • CAPEX in PP&E: € 37 million, € -11 million below the level in H1 last year
  • In July 2020, Bekaert reached final agreements with buyers on the sale of properties in Belgium:
    • Hemiksem land: net cash impact of € +23 million and income statement impact of € +36 million in Q4
    • Moen plant and small factory building in Zwevegem: net cash impact of € +10 million in Q4

34

Outlook

  • We project a gradual recovery in tire markets in the remainder of the year
  • Demand evolutions in other markets are more difficult to project in the current economic environment
  • We will continue to implement mitigating actions and other improvement measures
  • We expect continued impact from the progress made in strengthening our resilience

The current evolutions and potential second wave risk of the Covid-19 pandemic continue to create a high level of uncertainty.

In this context, we have limited visibility on the full-year impact in our markets and our business.

35

Debt management: new bond issue - strong liquidity - reducing debt & net debt leverage

  • New retail bond issue (€ 200 mln - 7 years - 2.75% annual gross coupon): (over)subscribed in one day - settlement date is 23 October. Proceeds will be used to pay back the convertible bond (€ 380 mln) maturing in June 2021.
  • Liquidity and cash generation are strong and allow:
    • Pay-backof EIB loan in early October 2020 without refinancing (€ 75 mln)
    • Pay-backof retail bond on 17 October 2020 without refinancing (€ 46 mln)
    • Pay-backof € 190 mln drawdown on credit lines
    • Pay-backof part of the convertible bond maturing in 2021 from cash (€ 180m)

36

Investor presentation - Bekaert

Debt maturity table

600 000 000

60 mio € will be paid back on 24/12/2020

400 000 000

Pay-back on 9 June 2021

200 000 000

0

2020

2021

2022

2023

2024

2025

2026

2027

-200 000 000

-400 000 000

-600 000 000

-800 000 000

-1 000 000 000

Bond Convertible LT ST Schuldschein Cash

37

Investor presentation - Bekaert

Net debt and leverage evolution

1200

In millions of €

1000

2.7

2.6

800

2.3

2.1

600

400

200

1151

1153

1253

977

0

2017

2018

1H 2019

2019

Net debt

Net debt/EBITDA-Underlying

2.5

955

1H 2020

3

2.5

2

1.5

1

0.5

0

38

Investor presentation - Bekaert

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt maturity profile - Net debt leverage

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

39

Investor presentation - Bekaert

Investing in Bekaert is taking part in

  • The growth ambitions of a world market and technology leader
  • A transformation towards 7% underlying EBIT margin over the medium term and higher beyond
  • A high-tech solution provider focusing on product and application innovations in attractive growth markets
  • Technology and Innovation priorities aligned with the megatrends that will shape our future
  • Our drive to develop durable solutions for renewable energy projects, carbon-free heating systems and

a significant emission reduction of vehicles

  • Ambitious targets to reduce the company's carbon footprint
  • A corporate socially responsible company with 28 000 motivated employees worldwide
  • Bekaert's commitment to return value to its shareholders

40

Investor presentation - Bekaert

41

Investor presentation - Bekaert

The Bekaert journey since 2013 + Our Ambition

5,2%

2013

Negative:

Volatility of wire rod prices and inflationary costs

Uncertainty related to US trade policy changes and Brexit

Difficult business climate in Latin America

Very limited demand for our sawing wire

2020

Start-up issues in expansion projects

Unfavorable one-time effects in BBRG

Downsides:

Positive:

Impact of Covid-19

Growth and strengthening position in tire markets

Political & economic uncertainty

Tire/Automotive demand strong on a global scale

Impact of transformation programs

Better market position in Tire cord China

Benefits of ongoing expansion investments

Upsides:

Customer excellence program

Benefits from restructurings 2019-2020

Bridon added as from H2 16

Benefits of turnaround/profit restoration actions

Pricing discipline & mix improvement

8,2%

Strong global response to Covid-19 crisis

Environmental regulations

2016

Innovation opportunities

7,3%

7%

6,3%

2017

2015

5,6%

5,1%

2019

2014

Negative

4,9%

Negative:

Bridon for full year (still below average margin) 2018

Trade war, Brexit, …

Deconsolidation Sumaré: integration in JV

Inventory valuation impact of steep decline in wire rod prices

Pirelli Tire Cord acquisition Q4 ´14

Brazil (45% BEK)

Softening OEM tire cord markets in H2

Fast changing raw materials prices & pricing

Portfolio optimization: exit stainless,

Lower demand in agricultural, industrial and automotive

dynamics

carding, Xinyu China

Positive :

Better market position in RR China

Positive :

Pricing and mix improvement in BBRG & Building Products

Tire cord India and SEAS picking up

Market share and volume growth in Tire Cord China

Tire/Construction remain strong

Sawing wire 2nd generation

Profit restoration programs in weaker business areas

Transformation programs

Manufacturing excellence program

Manufacturing cost & overhead cost savings

42

Investor presentation - Bekaert

= Underlying EBIT-margin

Dividend policy

In millions of €

400

80%

300

60%

out-Pay

44%

200

40%

40%

ratio

100

20%

-

0%

2009

2010

2011

2013

2014

2015

2016

2017

2018

2019

Result Attributable to the Group

Dividend pay-out

Pay-out policy over the years

Average pay-out % over the years

It is the policy of the Board of Directors to propose a profit appropriation to the General Meeting of Shareholders which, insofar as the profit permits, provides a stable or growing dividend while maintaining an adequate level of cash flow in the company for investment and self-financing in order to support growth.

In practice, this means that the company seeks to maintain a pay-out ratio of around 40% of the result for the period attributable to equity holders of Bekaert, over the longer term.

In view of all measures taken by Bekaert to mitigate, as far as possible, the impact of the Covid-19 pandemic on the Group's profitability and liquidity, the Annual General Meeting approved to halve the initially proposed dividend to 35 eurocent and to postpone the dividend payment to November 2020.

43

Investor presentation - Bekaert

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt maturity profile - Net debt leverage

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

44

Investor presentation - Bekaert

2019 Sales

Consolidated third party sales

2018

2019

Share

Variance

Organic

FX

Rubber Reinforcement

1 908

1 953

45%

+2%

+1%

+2%

Steel Wire Solutions

1 497

1 448

34%

-3%

-4%

+1%

Specialty Businesses

411

414

10%

+1%

=

+1%

BBRG

463

489

11%

+5%

+4%

+1%

Group

26

19

-

-

-

-

Total

4 305

4 322

100%

+0.4%

-0.7%

+1.3%

Combined third party sales

5 074

5 132

+1.1%

+0.5%

+0.7%

45

Investor presentation - Bekaert

2019 Financial Highlights

2018

2019

yoy

%

Sales

4 305

4 322

+17

+0.4%

EBITDA-underlying

426

468

+42

+9.9%

EBIT-underlying

210

242

+32

+15.1%

One-off items

(63)

(87)

-24

37.4%

Result of the period

3

48

+45

-

% EBITDA-underlying

9.9%

10.8%

0.9pp

+9.1%

% EBIT-underlying

4.9%

5.6%

0.7pp

+14.7%

% ROCE-Underlying

8.0%

9.5%

1.5pp

+18.8%

Working Capital

875

699

-176

-20.1%

Net Financial Debt

1 153

977

-176

-15.3%

Change in Working Capital

(13)

(176)

-163

-

Net debt on EBITDA-underlying

2.7

2.1

-22.2%

CAPEX (PP&E)

198

98

-100

-50.5%

Improvement Actions and Results

  • Market share increase RR China
  • Better pricing
  • Improved mix from better segmentation
  • Cost savings from manufacturing excellence programs
  • Organizational efficiencies from deploying new organizational structure
  • Turnaround and restructuring programs
  • Overhead reduction
  • Less interest expenses from refinancing
  • Strong reduction working capital
  • Stringent CAPEX control
  • Net debt / underlying EBITDA at 2.1

46

Investor presentation - Bekaert

EBIT-Underlying bridge: by result driver

47

Investor presentation - Bekaert

Consolidated income statement: key figures

(in mio €)

Underlying

Reported

2018

2019

2018

2019

EBIT

210

242

147

155

EBIT margin

4.9%

5.6%

3.4%

3.6%

EBITDA

426

468

387

403

EBITDA margin

9.9%

10.8%

9.0%

9.3%

ROCE

8.0%

9.5%

5.6%

6.1%

  • Improvement in EBIT, EBITDA and ROCE
  • The difference between Underlying and Reported is due to one-off elements. Full disclosure of one-offs: cf page 39.

48

Investor presentation - Bekaert

Consolidated income statement: one-off items

(in mio €)

2018

2019

EBIT - Underlying

210

242

Restructuring programs

(62)

(82)

Rubber Reinforcement

(25)

(15)

Steel Wire Solutions

2

(23)

Specialty Businesses

(18)

(16)

Bridon-Bekaert Ropes Group (BBRG)

(13)

(5)

Group

(8)

(23)

Other

(1)

(4)

EBIT

147

155

2018:

  • -63 million one-off items:
    • -62 million from restructuring programs and € -1 million other
    • net effect of € -108 million one-off costs and € +45 million one-off revenues
  • Main elements in one-off costs:
    • RR: Figline (Italy plant closure)
    • SWS: restructurings in Latin America and Shah Alam Malaysia
    • SB: asset impairments sawing wire + closure of Dramix plant in Costa Rica
    • BBRG: expenses turnaround program and restructuring Brazil
  • Main elements in one-off revenues:
    • RR: the gain on the sale of land and buildings of Huizhou (China)
    • SWS: the gain on the sale of land and buildings in Shah Alam (Malaysia)

2019:

  • -87 million one-off items:
    • -82.4 million related to restructuring
    • -4.4 million from losses incurred as a result of go-slow actions in a number of sites, partly offset by positive depreciation adjustments in BBRG
  • Main elements in one-off costs:
    • RR: Rome (US, relocation)
    • SWS: plant closures Ipoh (Malaysia) and Shelbyville (US)
    • SB: Dramix plant closures in Costa Rica and Belgium
    • BBRG: restructuring programs in EMEA
    • Lay-offsin Group functions (mainly Belgium)
  • No one-off revenues in 2019

49

Investor presentation - Bekaert

Ratios: key figures

Underlying

Reported

2018

2019

2018

2019

Gross profit margin

13.6%

13.6%

12.2%

12.2%

EBITDA margin

9.9%

10.8%

9.0%

9.3%

EBIT margin

4.9%

5.6%

3.4%

3.6%

Sales on capital employed (asset rotation)

1.6

1.7

1.6

1.7

Return on capital employed (ROCE)

8.0%

9.5%

5.6%

6.1%

Return on equity (ROE)

0.2%

3.2%

(in mio €)

2018

2019

Net financial debt

1 153

977

Gearing (net debt to equity)

76.0%

63.8%

Net debt on EBITDA (underlying)

2.7

2.1

Net debt on EBITDA (reported)

3.0

2.4

  • As per introduction of IFRS 16 (Leases), € 83.5 million additional net debt was recognized.
  • Improvement of Underlying EBITDA following IFRS 16: € 25.1 million.
  • Impact IFRS 16 on Net Debt to EBITDA (underlying): would have been 2.0 instead of 2.1.

50

Investor presentation - Bekaert

Content

BEKAERT IN BRIEF

4

Fact sheet

  1. High-techsolution provider
  2. Sustainability ambitions and actions

8

Global presence

9

Technological and Market leadership

SEGMENT PERFORMANCE

13

Leadership team

14

Segmentation and sectorial breakdown

15

Segment profile sheets

19

1H2020 Sales

GROUP RESULTS H1/2020

  1. Market developments and Covid-19 impact
  2. Our response + Financial highlights

26

uEBIT bridge

28

Segment reports + Consolidated statements

35

Outlook

36

Debt maturity profile - Net debt leverage

INVESTMENT CASE

Investing in Bekaert

40

Strategy - Blue Slide

41

Profitability: journey and ambition

42

Dividend policy

43

FINANCIALS FY2019

2019 performance

45

2019 EBIT bridge

47

Income statement Key figures

48

Ratios

50

OTHER

News updates

52

History

53

Product and Market Portfolio

54

Contact information

61

51

Investor presentation - Bekaert

News updates:https://www.bekaert.com/en/about-us/news-room

€ 200 million bond (over) subscribed in one day

Launch of € 200 million retail bond - 7 years

Merger of steel wire players in Colombia

Floating offshore wind partnership with Ideol

H1 2020 results

Sale of real estate: € +36 million P&L impact

Entering VPPA to source 55% of US electricity needs from wind energy

Move of Dramix activities to BBRG plant in US

52

Investor presentation - Bekaert

History

pioneering

innovating

growing

diversifying

BRIC

transforming

1880

Leo Leander Bekaert starts a small business in barbed wire in Zwevegem, Belgium

1922

First investment abroad: Tréfileries de Bourbourg, France

1948

First investments in Latin America: Argentina and Chile

1952

Early 1970s

Early 1980s

Steel cord production

New steel cord plant

Bekaert moves into

start

openings and

composite materials,

expansions in US,

non-ferrous forged

Brazil, Belgium, Japan

products, vacuum

coatings and filtration

1964

1972

1988

Establishment of R&D

Listing on the Brussels

New plant openings in the

center in Deerlijk,

stock exchange to fund

US in response to local

Belgium

continued growth

demand

1965

1975-1977

1990

Start-up of Engineering

Establishment of joint

Bekaert has become a truly

facility for machine

ventures in Ecuador

international company with

design and manufacture

and Brazil

15000 employees worldwide

1993

Bekaert recognizes China's huge market potential and builds a first steel cord plant in Jiangyin, Jiangsu Province

Mid 90s

Investments and expansions in Brazil, India, Indonesia, China, Peru and Chile

2000-2010

Strong growth in China, Central Europe, and start-up production in Russia

2013

Bekaert lifts its ambition level and deploys global excellence programs across the business

2014-2016

Bekaert concludes its largest acquisition (Pirelli) and merger (Bridon) ever

2019

The company implements a new organizational structure to revitalize its performance

53

Investor presentation - Bekaert

Tire & Automotive (46%)

In the tire & automotive sector, we set ourselves apart by consistently creating high-quality and innovative products that are tailored to our customers' needs. We supply specialized wire products that meet the highest quality standards.

tire cord

clutch spring wire

bead wire

wheel weights

wires for windscreen wiper arms and blades

steering column profiles

wires and cables for window systems

insulation wire and fiber yarns for car seat heating

heating cord

conductive yarns in tires

heating cables for SCR tubes and tanks

metal fiber media for exhaust filtration, etc.

54

Construction (18%)

By offering wire, mesh and fiber products in numerous construction applications, we seek out more environment-friendly solutions with a focus on better materials, greater safety, improved ease-of-use and lower energy consumption, all with an eye on cost-efficiency.

Dramix® steel fibers for concrete reinforcement

gabions

Stucanet® plaster lath

steel strands for cable stay bridges

Mesh Track® and Fortifix® road reinforcement

prestressed concrete strands

Murfor® and Murfor® Compact masonry reinforcement

post-tensioning strands

wires and cables for hoisting applications

environmentally friendly gas burners

a-cords for elevators

residential, public and industrial fencing solutions

welded mesh

etc.

55

Agriculture (8%)

Across the agricultural sector, Bekaert provides innovative solutions that make day-to-day work easier. Through our global footprint and our mix of trading and manufacturing, we can offer total packages to our customers.

tensioning wire for plant support and binding

fencing systems

vineyard wire

fishing ropes

spiral wire for the livestock feed industry

etc.

  • barbed wire

56

Energy & Utilities (8%)

Whether it concerns onshore or offshore oil extraction, gas mining, power transmission, solar energy, or even telecommunications, Bekaert products are key contributors to sustainable, safer and more cost-efficient operations.

wire and ropes for oil and gas exploration

profiled wires for wedge filters

steel wires and strands for overhead power lines

sawing wire / diamond wire

telecom armoring wire

hose coupling

profiled wires for flexible pipes

etc.

57

Consumer goods (7%)

As ever higher quality and comfort standards and functionalities are required, the demand for more advanced coated steel wire products evolves accordingly.

Often unknown, but always there: Bekaert is a part of the products we all use every day.

champagne cork wire

bookbinding and stitching wire

wire for kitchen utensils

Bezinal® XP/XC spring wire for medical instruments

spring wire for bedding and seating

stainless steel fibers for smart clothing

brassiere wire

stainless steel fibers for composite materials

staple wire

etc.

58

Basic Materials (7%)

Many Bekaert products are used in exploring and producing raw materials, from coal and metals to pulp and paper, to chemicals and textiles. We make cable and wefts for conveyor belts that are used across many industries. We continue to find new ways to span every step of the value chain.

steel ropes for mining applications

pulp baling wire

sintered metal fiber filtration media

Fleximat® steel cord fabric for mining belts

heat-resistant separation materials

etc.

  • fibers for conductive and protective clothing

59

Equipment (6%)

Bekaert supplies heavy equipment makers and operators with a range of specialized steel wire products. As we build our own proprietary machinery, we know exactly what it means to make high-performance equipment. This allows Bekaert to focus on innovation and machine makers to focus on operational excellence.

hoisting ropes for cranes

hose reinforcement wire

shovel ropes

Syncrocord® a-cords reinforcing synchronous belts

Bezinal® XP/XC coated spring wires

customized profiled components

brush wire

fiber media for sound attenuation

Fleximat® for conveyor belts

etc.

60

Contact

Investor Relations :

Katelijn Bohez

+32 56 76 66 10

katelijn.bohez@bekaert.com

Documentation :

Dries Van Hamme

+32 51 33 34 23

dries.vanhamme@bekaert.com

Christine Clarysse

+32 56 76 66 13

christine.clarysse@bekaert.com

Shareholders, investors and other interested parties wishing to receive the Group's annual report, the shareholders guide, the annual accounts of NV Bekaert SA or other information published by the Group may contact the Investor Relations department at any time.

Agenda:

Dividend payable (new date)

20

November

2020

Third quarter trading update 2020

20

November

2020

Disclaimer

This presentation may contain forward-looking statements. Such statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Bekaert is providing the information in this brochure as of its date and does not undertake any obligation to update any forward-looking statements contained in this brochure in light of new information, future events or otherwise. Bekaert disclaims any liability for statements made or published by third parties and does not undertake any obligation to correct inaccurate data, information, conclusions or opinions published by third parties in relation to this or any other publication issued by Bekaert.

61

Investor presentation - Bekaert

Investor section online @ www.bekaert.com

62

Investor presentation - Bekaert

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Bekaert NV published this content on 23 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 October 2020 16:19:07 UTC