An introduction

September 2010

1© CHARTER 2010

Contents

1. Introduction to Charter

2. ESAB

3. Howden

4. Charter – financial highlights

5. Appendices• Charter Chairman and CEO biographies

• Share price graphs

• Manufacturing locations

2© CHARTER 2010

Further information is available at www.charter.ie

Introduction to Charter

Charter International plc, headquartered in Ireland, owns (through a number of intermediate companies) two international engineering businesses, one focused on welding, cutting and automation (‘ESAB’), and the other on air and gas handling (‘Howden’).

3© CHARTER 2010

Five-year record

Notes: 1) The 2006 comparatives have been restated to reflect the change in accounting for post retirement benefits2) Before amortisation and impairment of acquired intangibles and goodwill and excluding exceptional item3) Before amortisation and impairment of acquired intangibles and goodwill, exceptional items and (losses)/gains on retranslations of intercompany loan balances4) Excluding exceptional items, gains or loses on inter-company loans and amortisation of goodwill. In 2006, earnings per share includes profit on property disposals

of 2.9 pence per share

99.2

51.8

578.3

212.5

211.2

1,887.0

2008£m

55.0

50.9

549.9

126.0

125.6

1,659.2

2009£m

84.7

88.2

426.4

181.1

173.8

1,451.1

2007£m

68.143.0Adjusted earnings per share (pence)4

43.1(6.5)Cash/(Debt)

246.1135.1Equity shareholders’ funds

145.899.9Adjusted profit before tax3

144.697.5Adjusted operating profit2

1,257.9

20061

£m1,065.7Revenue

2005£m

4© CHARTER 2010

Charter’s Global Presence

In 2009, Charter’s global sales amounted to £1,659.2 million, split broadly equally between the developed economies of Western Europe and North America, and the emerging economies of Central and Eastern Europe, Asia and South America

Charter’s 2009 global presence

Europe36%

North America22%

South America12%

China9%

Rest of World21%

5© CHARTER 2010

ESAB: Overview

• World leading manufacturer and supplier of:– welding consumables

– welding equipment (standard and bespoke); and

– cutting equipment

• Revenue (£1,031.4 million in 2009) spread approximately equally between developed economies (Western/Northern Europe and North America) and developing economies (Central/Eastern Europe, South America and Asia)

• Key end user markets are energy, infrastructure and shipbuilding

• Adjusted operating margin of 6.3 per cent (2009) and 9.0 per cent (1H2010); average adjusted operating margin 2005 – 2009 was 10.7 per cent

• Manufacturing footprint– Predominantly low cost locations (Central/Eastern Europe, Asia and

South America)

ESABWelding and cutting

6© CHARTER 2010

Major cutting and welding end users

Mobile machinery

All otherAutomotiveInfrastructure constructionShipbuilding & offshore

Oil, gas & process EnergyPipeline and pipe mills

7© CHARTER 2010

Market profile – welding and cutting1 2009: $12.8 billion globally

By region By end user segment

EnergyOil, gas & processes 9.5%Power 4.2%Petrochemicals 5.8%Pipelines & pipe mills 6.0%Total energy 25.5%

Infrastructure construction

18.0%

Shipbuilding9.0%

Automotive/ mobile

machinery14.0%

All other (including

repairs and maintenance)

33.5%

Europe19%

North America16%

China21%

Japan10%

All Others11%

Russia & CIS7%

Other Asia6%

South America6%

India4%

Notes: 1 The global welding and cutting market in which ESAB operates excludes welding robots and automation products.

8© CHARTER 2010

Global steel consumption – a leading indicator of the demand for welding products

• The World Steel Association (“WSA”) estimates steel use of 1,241 million metric tons (“MMT”) during 2010 and it is expected to increase to 1,306 MMTs (up 5.3%) in 2011.

• Figures by region are set out below:2009

% change2010

% change2011

% change

U.S.A. -42% +27% +8%

EU (27) -35% +14% +8%

China +25% +7% +3%

Asia (ex China) -18% +13% +6%

South America -24% +20% +7%

RoW -17% +11% +8%

World -7% +11% +5%

World excluding China -25% +14% +7%

9© CHARTER 2010

Source: ESAB estimates

Worldwide weld metal consumption – by weld process

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009E 2010F

Thou

sand

s of

met

ric to

nnes

Electrodes Solid wire Sub Arc wire Flux cored wire

10© CHARTER 2010

Source: ESAB estimates

Worldwide weld metal consumption – by region

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009E 2010F

Thou

sand

s of

met

ric to

nnes

N. America Europe Asia Other

11© CHARTER 2010

ESAB: Welding consumables – the electrode

• The traditional welding consumable used in manual welding applications.

• The welding electrode can be a very advanced product; approximately 60% of ESAB’s electrode sales are in welding critical applications requiring advanced technology and stringent process control.

• In Europe and North America, process conversion away from electrodes to wire is advanced, however a core volume of electrode demand remains for specialist applications.

• In emerging markets, usage of electrodes is more widespread and ESAB is looking to grow market share in these markets, partly through technology transfer.

12© CHARTER 2010

ESAB: Welding consumables – welding wire

• The welding consumable used in automated welding applications.

• Includes solid wires, and also flux-cored wires.

• A more standardised product than electrodes, but ESAB has developed a range of technologically advanced proprietary products.

• The Marathon PacTM wire delivery system can offer truly non-stop production in robot applications, such as automotive production lines.

13© CHARTER 2010

Mass produced welding equipment, generally for manual welding applications

• ESAB provides a range of standard equipment for manual and semi automatic welding applications

• The range covers most welding processes including welding with electrodes, solid or cored wires and TIG.

• There are a number of equipment families suitable for all requirements and environments, including Caddy™, Origo™ and Aristo™

MIG weldingMMA welding (electrodes) TIG Welding

ESAB: Standard welding equipment

14© CHARTER 2010

ESAB: Automated equipment

• ESAB offers a wide range of solutions for mechanised and automated welding

• ESAB is well positioned for growth in the energy segment, which is further supported by the acquisition of Romar and the development of the new telescopic Column & Boom

• The new telescopic Column & Boom provides increased safety, accuracy and efficiency while consuming significantly less space then existing solutions

ESAB’s new telescopic boom in a “see through pipe”

15© CHARTER 2010

ESAB: Cutting equipment

• Cutting techniques include oxy fuel, plasma, laser and water-jet, according to the type of steel being cut and the precision required.

• ESAB has developed a comprehensive range of machines, including a new range for emerging markets (FALCON), made in China.

• Aftermarket business now contributing >30% of sales – strong focus to build rapidly.

16© CHARTER 2010

0

400

800

1,200

1,600

2,000

2,400

LINCOLN

ESAB

ITW

ALWBOHLER

MEC - Mes

ser

Thermad

yne

KOBETian

jin G

BHyu

ndaiPan

asonic

Tianjin

Brid

geNitte

tsuAtla

ntic C

hinaOTC D

aihen

Binzel

Kiswel

Fronius

Kemppi

US$

m

ESAB SeAH

Major welding and cutting companies

Source: ESAB estimates

Based on estimated 2008 turnover

17© CHARTER 2010

ESAB and Lincoln

Based on estimated 2009 turnover

Source: ESAB estimates

Turnover by geography

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

LINCOLN ESAB

US$

M

ESAB SeAH Cutting & brazingSouth AmericaAsia PacificEuropeNorth America

Turnover by product

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

LINCOLN ESAB

US$

M

ESAB SeAH

Welding equipment,cutting and automationWelding consumables

18© CHARTER 2010

ESAB: key end users – wind energy

• Wind tower manufacture requires extensive investment in welding equipment and continued expenditure on welding consumables.

• Wind energy capacity extension in 2007 was 27,000MW

• By 2012 this could well be 60,000MW

• Each MW of wind power consumes 700kg of weld metal and 600kg of welding flux.

• This would require 49,000t of weld metal and 42,000t of welding flux which equals €100m of total consumable spend

Source: Frost & Sullivan estimates

19© CHARTER 2010

ESAB: destination of sales – 2009 V 2002

Emerging Europe comprises Central/Southern/Eastern Europe

Developed Europe comprises Western/Northern Europe and Iberia

2009 (total sales £1,031.4 million) 2002 (total sales £581.9 million)

Europe (developed)

25%

North America23%

South America16%

Rest of World9%

India5%

China3%

Russia6%

Europe (emerging)

13%

Europe55%

North America33%

South America9%

Rest of World3%

20© CHARTER 2010

ESAB: worldwide consumables manufacturing capacity

• Since 2002, ESAB has increased its manufacturing capacity by over 250,000 tonnes to 700,000 tonnes principally through investment in emerging markets

Asia

Central/Eastrn Europe

(inc Russia)

South America

Western/Northern Europe

North America

Asia

Central/Eastern Europe (inc Russia)

South America

Western/Northern Europe

North America

2002 Capacity2009 Capacity

Western/ Northern

Europe

Central/ Eastern Europe(inc Russia)

Central/ Eastern Europe(inc Russia)

Western/ Northern

Europe

21© CHARTER 2010

ESAB: impact of economic downturn

• Sharp reversal in the fourth quarter of 2008, most marked in Europe and North America

• Relative stability in the first quarter of 2009, but further volume declines in April and May 2009

• Second half of 2009 was generally stable in terms of prices and volumes; operating result underpinned by benefit of cost savings

• Recovery in the first half of 2010 was led by welding consumables and standard equipment; consumables volume up 9.3%; standard equipment also improving; cutting and automation performance stabilised, improvement likely in 2011

• Recovery expected to be led by BRIC economies. Western Europe/ North America flat

22© CHARTER 2010 22

ESAB: restructuring process

• Since the commencement of the downturn in October 2008, ESAB has:

– Reduced headcount by 1,600 people (equivalent to 17% of the peak workforce), reducing manned

capacity by around one-third (consumables) and one-half (equipment)

– Closed three consumables factories (Finland, Italy and Sweden)

– Mothballed one consumables factory (Italy) and an equipment factory (China)

– Implemented measures to improve procurement and reduce business overheads

– Commenced restructuring of US equipment business, with production moving to Europe, China and

South America (nearing completion)

– Commenced restructuring of European supply chain to improve efficiency and customer service

(continuing)

• Since 31 December 2010, ESAB:

– Restored manned capacity in line with demand in first half 2010

– Closed capacity re-installation will complete during 3Q2010

23© CHARTER 2010

ESAB: restructuring

24.32009

£m

2008 6.2

2010 (expected; including £6m from 2009) 15.0

Total restructuring charge 45.5

Savings achieved (2009) 50.0+

24© CHARTER 2010

ESAB: manufacturing locations

Traverse CityAshtabula

HanoverFlorence

Monterrey

Belo Horizonte

St Luis

Chascomus

Jakarta

SingaporeChennai(2 factories)

CalcuttaNagpur

ShanghaiZhangjiagangWeihaiWuxi

IhtimanTerni

Karben

Mor

KatowiceOpoleVamberk

St PetersburgLaxa

Perstorp

Current manufacturing siteCurrently mothballed

Global R&D centre

Gothenburg

25© CHARTER 2010

ESAB: continuing development during the downswing

Capital expenditure £40 million in 2009 (2x depreciation)Will remain well in excess of depreciation in 2010Emphasis on efficiency and cost-saving measures

R&D expenditure Will maintain at current levels

Acquisitions Continue to look at incremental, bolt-on acquisitions at appropriate prices

26© CHARTER 2010

ESAB: Revenue by destination (£m)

540.895.414.281.8

118.7230.7

£m

6 monthsto 30.06.09

6 monthsto 30.06.10

12 monthsto 31.12.09

12 monthsto 31.12.08

£m £m £m

Europe 214.6 424.6 594.7North America 109.7 218.6 238.6South America 114.9 171.9 198.0China 16.6 27.1 36.4Rest of world 103.0 189.2 192.1Total sales 558.8 1,031.4 1,259.8

27© CHARTER 2010

ESAB: revenue (£m)

540.8108.2432.6

£m

6 months to 30.06.09

6 months to 30.06.10

12 months to 31.12.09

12 months to 31.12.08

£m £m £mWelding 494.5 846.7 1,042.2Cutting and automation 64.3 184.7 217.6Revenue 558.8 1,031.4 1,259.8

28© CHARTER 2010

ESAB: adjusted operating profit (£m)

11.9%

12.2%

11.8%

3.1

150.026.6

123.4£m

12 months to 31.12.08

6.7%

7.3%

6.6%

1.4

36.47.9

28.5£m

6 months to 30.06.09

6 months to 30.06.10

12 months to 31.12.09

£m £mWelding 52.4 55.6Cutting and automation (2.3) 10.4Adjusted operating profit1 50.1 66.0

Share of profits of associates and joint ventures (post tax) 1.8 3.5

Adjusted operating margins

Welding 10.6% 6.6%

Cutting and automation -3.6% 5.6%

Overall 9.0% 6.4%

1 before exceptional items, acquisition costs and amortisation and impairment of acquired intangibles and goodwill

29© CHARTER 2010 29

ESAB: 2010 outlook

• Continuing lack of clarity in economic outlook:– Many positive indicators but government-led austerity in developed markets

– Western Europe / North America: flat

– Russia, South America and India are best performing markets

• WSA has forecast a 14 per cent increase in global steel use (excluding China)– Will first be reflected in volumes of consumables, followed by standard equipment

– Potential for significant ‘drop through’ from higher consumables volumes

– Steel prices and volumes likely to fluctuate; pricing discipline and capacity management will be

key

• Cutting and automation– Cutting performance stabilised but improvement unlikely until 2011

– Prospects good in automation, but orders are being deferred due to uncertainty

30© CHARTER 2010

ESAB: “the welding authority”

• Invest in brand, customer service and technology

• In developed markets, build on strong positions; emphasize high growth, welding

intensive sectors, such as nuclear, pipelines and offshore

• In developing markets, build upon leading positions in Brazil, Russia and India, and

grow elsewhere (e.g. China, Asia and Africa)

• Act as an industry consolidator

31© CHARTER 2010

Howden: Overview

HowdenAir and gas handling equipment• A world-leading international applications engineer

• Designs, manufactures, installs and services air and gas handling equipment– Centrifugal and axial fans

– Air and gas rotary heat exchangers

– Turbo-blowers and compressors

• After-market revenues are around 30 per cent of total

• Revenue (£627.8 million in 2009) split between Europe, North America, China and the rest of the world (predominantly the remainder of Asia and South Africa)

• Adjusted operating margin of 11.2 per cent in 2009; 10.2 per cent in 1H 2010

• Customers in the power and energy industries account for over three quarters of sales, in particular coal-fired power stations

32© CHARTER 2010

Howden: Products and services

• Howden supplies high integrity – Fans

– Rotary heat exchangers

– Compressors

for use in power generation and industrial

applications which demand extremely high

levels of efficiency, reliability and

availability.

Rotary heat exchanger Cooling fanAxial fanCentrifugal fan

Compressor Aftermarket

33© CHARTER 2010

Howden: Supply chain management

Our manufacturing and sub-contracting networks span the globe

34© CHARTER 2010

Howden: major market – coal fired boiler with FGD

35© CHARTER 2010 35

Howden: future of coal

• According to the IEA, coal is expected to have an increased share of world primary energy demand.

• By 2030, fossil fuels will still provide for some 80 per cent of primary world energy.

World primary energy demand by fuel (Mtoe)

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

1980 2000 2007 2015 2030

Co al Oil Gas Nuclear Renewab les

36© CHARTER 2010 36

Howden: electricity generation

• The IEA expects coal-fired electricity generation to almost double between 2007 and 2030.

31.9%1,4402007 2015 2030

Coal-fired generation (GW) 1,897 2,705As percentage of total 33.1% 34.6%

Projected global electricity generation capacity by fuel - GW

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

2007 2015 2030

Coal Oil Gas Nuclear Renewables

37© CHARTER 2010 37

Howden: coal-fired generating capacity

Projected coal-fired electricity generation capacity by region (IEA)

0

50

100

150

200

250

300

350

400

North America Europe

200720152030

38© CHARTER 2010 38

Howden: coal-fired generating capacity (continued)

0

200

400

600

800

1000

1200

1400

North America Europe India China

200720152030

Projected coal-fired electricity generation capacity by region (IEA)

39© CHARTER 2010

Howden: market opportunities

• The potential sales value for Howden equipment on a large plant varies significantly by industry

0.85,000MT/yr cement plant in Europe0.3Large coal mine in China

2.0Major sinter plant in China (UK supply) **4.2Retrofit FGD plant on large boiler in Europe

1.0

5.5

£m

Large coal fired boiler in Europe*

Large waste water treatment plant

Plant type

* Excludes FGD. Prices in China are 50-65% of those in Europe** Includes drive system

40© CHARTER 2010

Howden: Sales analysis

Notes: New equipment plus aftermarketExternal sales only

2009 sales by industry type 2009 sales by region

Power55%

Mining8%

Petrochemical13%

Iron & Steel7%

Other 17%

Europe27%

North America24%

China20%

South America5%

Rest of World24%

41© CHARTER 2010

Howden: Market share – engineered fans and heat exchangers

Howden’s principal competitors

• Fans– TLT Turbo

– TLT Babcock

– Shanghai Blowers

– Fläkt Woods

– Chengdu

• Rotary Heat Exchangers– Alstom

– Shanghai Boiler

– Harbin

– Balcke Dürr

Source: Howden estimates (based on 2008 figures)

In-house market:Certain equipment companies use their in-house capability to manufacture fans and heaters without seeking external tenders.

Total market (£1.4 billion)

Competitors60%

Howden 24%

In-house16%

42© CHARTER 2010

Howden: Market share – compressors

Howden’s principal competitors– HV-Turbo

– Kobelco

– Enerflex

– Mycom

Compressors include– Turbo compressors

– Screw compressors

– Piston compressors

Potentially available:Includes market niches currently served by Howden and other markets where Howden technology is considered suitable

Unavailable:The unavailable market is due to customers requiring packages of compressors, where Howden is unable to supply the full range Source: Howden estimates (based on 2008 figures)

Total market (£1.0 billion)

Howden 9%

Potentially available

83%

Unavailable8%

43© CHARTER 2010

Howden: The aftermarket – segments and characteristics

The aftermarket• All activities to maintain, modify, upgrade and extend the product performance

and operational life• Selling new equipment creates a potential revenue stream at higher margin over

the operating life, typically 30 to 40 years, normally commencing around 4 years after original equipment has been installed

2%Screw compressor3%Turbo compressor

4%VP axial fan8%Centrifugal fan, steel

6%

4%

Annual revenue

Centrifugal fan, power

Rotary heat exchanger

Product

Annual revenue as a percentage of the original capital cost

44© CHARTER 2010

Howden: The aftermarket – market size

Aftermarket by product

177

187

39

117

FanHeaterCompressorOther

96

140

130

154

ChinaEuropeNorth AmericaRest of World

Aftermarket by region

Estimated total market £600 millionSource: Howden estimates; the estimated total market comprises

the market for the maintenance and servicing of Howden equipment together with certain equipment supplied by other companies; excludes retrofit.

45© CHARTER 2010

Howden: The aftermarket – Howden sales

Aftermarket sales by product Aftermarket sales by region

50%

17%

16%

17%FanHeaterCompressorOther

8%

35%

23%

34%

ChinaEuropeNorth AmericaRest of World

46© CHARTER 2010

Howden: summary of results (£m)

11.7%

73.6627.2162.2465.0

£m

12 months to 31.12.08

11.7%

35.7305.4

94.1211.3

£m

6 monthsto 30.06.09

6 monthsto 30.06.10

12 months to 31.12.09

£m £mNew equipment 186.5 438.6Aftermarket 95.1 189.2Revenue 281.6 627.8Adjusted operating profit1 28.8 71.5

Adjusted operating margin1 10.2% 11.4%

1 before exceptional items, acquisition costs and amortisation and impairment of acquired intangibles and goodwill

47© CHARTER 2010

Howden: revenue by destination (£m)

305.465.915.356.580.787.0

£m

6 monthsto 30.06.09

6 monthsto 30.06.10

12 monthsto 31.12.09

12 monthsto 31.12.08

£m £m £m

Europe 71.0 171.1 165.3North America 69.1 149.0 181.5China 43.7 123.1 136.6South America 18.4 31.7 30.3Rest of world 79.4 152.9 113.5Total sales 281.6 627.8 627.2

48© CHARTER 2010 48

Howden: order book composition (£m)

0

100

200

300

400

500

600

31 Dec 2008 30 Jun 2009 31 Dec 2009 30 Jun 2010

£m

Rest of WorldChinaNorth AmericaEurope

£441m

£536m£499m

£439m

49© CHARTER 2010 49

Howden: order book movements (£m)

Six months

ended

Six months ended

Six months ended

30.06.10 31.12.09 30.06.09Order book £m £m £m

Balance brought forward 441.1 535.7 499.3Orders booked* 269.8 239.9 273.7Sales (281.6) (322.4) (305.4)Orders cancelled (1.2) (5.0) (6.0)Foreign exchange impact 10.8 (7.1) 74.1Balance carried forward 438.9 441.1 535.7

* includes £2.2 m on the acquisition of AustCold

50© CHARTER 2010 50

Howden: order intake

Orders received: 2008 vs 2009

0

10

20

30

40

50

60

70

80

90

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

£m

20082009

51© CHARTER 2010

Howden: steps taken to reposition the business

• Rationalised product range– 2002: wide range of fans (including HVAC) and other products

– 2010: tightly focussed on engineered fans and compressors

• Coal-fired power– 2002: depressed conditions

– 2010: strong long-term outlook for power

• Compressor business– 2002: small

– 2010: investment in acquisition of HCL and the Chinese factory, with strong demand

outlook from oil/gas/petrochemicals, and new industries (e.g. waste water treatment)

52© CHARTER 2010

Howden: steps taken to reposition the business (continued)

• Manufacturing– 2002: integrated general manufacturing from steel fabrication to assembly

– 2010: emphasis on design, value-added manufacture, installation and service, with

extensive outsourcing

• Aftermarket– 2010: revenues represent 30 per cent of Howden’s total; the business is well

positioned to benefit from high sales of new equipment in recent years

• Restructuring– Restructuring undertaken to ensure that capacity is in line with prevailing levels of

demand

53© CHARTER 2010

Howden: corporate developments

• India – joint venture with Larsen & Toubro– 50/50 joint venture will give access to the Indian power market

– Howden and L&T will each invest £2 million in the JV which will be used to build a

new specialist factory; production to start in 2011

– India is seen as being a major investor in coal-fired generating plants over the next 20

years

• AustCold– Acquisition of Australian compressor packager for A$5.6 million

– Increases Howden’s presence in the compressor industry in Australia

– Significant potential opportunities exist in this market; e.g. unconventional gas

54© CHARTER 2010 54

Howden: 2010 outlook

• 2010 to be in line with our earlier expectations– New equipment sales

– Good visibility from order book

• Aftermarket– Improved performance in second half from the US

– Business remains capable of generating 10% year-on-year growth

• Bookings– Level of enquiries remains good but continuing customer delays in orders due

to uncertainties

• Business likely to become more focused on emerging markets where coal-fired new build programmes will be more extensive in the coming years

Financial highlights Charter International plc

56© CHARTER 2010

Charter: Income statement

(1.9) (2.5) (3.9)Amortisation and impairment of acquired intangibles and goodwill

(0.7)(7.7)(2.1)Net financing charge – retirement benefit obligations

99.2p90.1p158.7(39.0)

1.5(2.4)

-0.4

(38.5)213.2

4.60.78.31.9

197.7197.7

3.2(6.5)(4.6)(1.2)

201.0-

(8.3)211.2

1,887.0

Year ended 31.12.08 £m

1.10.5Taxation on net financing charge – retirement benefit obligations

7.72.1Net finance charge – retirement benefit obligations

(0.3)(0.1)Other adjustments

32.8p30.4p56.0

(13.7)(1.8)

-

0.8(13.2)

73.3(1.9)

(0.5)3.9

69.769.71.8

(1.4)

69.3

0.672.7

840.4

Six months ended 30.06.10 £m

27.1Exceptional items and other adjustments

(26.8)Exceptional items

(4.0)Net (gains)/losses on retranslation of intercompany loan balances

2.5Amortisation and impairment of acquired intangibles and goodwill

126.0Adjusted profit before tax

92.7Profit before tax

AdjustedBasic

1,659.2Revenue125.6Adjusted operating profit

96.0Operating profit

(3.1)(1.2)Other financing charge before retranslation of intercompany loan balances 4.01.9Gains/(losses) on retranslation of intercompany loan balances

(6.8)Net financing charge3.5Share of post tax profits of associates and joint ventures

92.7Profit before tax

(22.7)Taxation on adjusted profit0.7Taxation on amortisation and impairment of acquired intangibles and goodwill

(1.2)Taxation on net gains/(losses) on intercompany loan balances4.2Taxation on exceptional items

(17.9)Taxation74.8Profit after tax

38.1pEarnings per share55.0p

Year ended 31.12.09 £m

57© CHARTER 2010 57

Charter: adjusting items

--(5.1)(8.5)Post retirement benefits curtailment gain

4.67.71.32.1Net finance charge – retirement benefit obligations

6 months to 30.06.10 12 months to 31.12.09

EarningsEarnings per

share EarningsEarnings per

share£m pence £m pence

Unadjusted results 50.8 30.4 63.5 38.1Exceptional items

Restructuring* 7.9 4.7 26.3 15.7

Business disposal - - 0.5 0.3Acquisition costs 0.1 0.1 0.3 0.2Amortisation and impairment of acquired goodwill and intangibles 3.9 2.3 2.5 1.5

Retranslation of intercompany loan balances (1.9) (1.1) (4.0) (2.4)

Taxation on adjusting items 0.5 0.3 (4.8) (2.9)Non-controlling share of adjusting items (0.1) (0.1) (0.2) (0.1)Adjusted results 54.8 32.8 91.8 55.0

* 2009 restructuring charge is split ESAB £24.3 million; Howden £2.0 million

58© CHARTER 2010

Charter: Cash generation

0.4

(34.9)

(0.8)

(34.1)

58.2%

40.3

0.5

(1.0)

(17.7)

(32.7)

58.3

(48.0)

(43.0)

21.9

69.3

6 months ended 30.06.09

£m

1.7

(110.3)

(39.4)

(70.9)

79.4%

159.5

1.1

2.2

(16.0)

(55.7)

29.8

(28.1)

(57.4)

26.9

201.0

Year ended 2008

£m

178.6%Cash conversion percentage

(17.9)Movement in net retirement benefit obligations

96.0 Operating profit

37.3 Depreciation and amortisation

37.7(Increase)/reduction in inventories

132.1(Increase)/reduction in receivables

(119.1)Increase/(reduction) in payables

50.7Net working capital (increase)/decrease

4.0Movement in other provisions

1.4Other items1

171.5 Cash generated from operations

(65.7)Capital expenditure (including capitalised development costs)

(2.6)Acquisitions

(68.3)

2.2Disposals

Year ended 2009

£m

Notes: 1 Other items include share based payments, loss/(profit) on sale of business and fixed assets

59© CHARTER 2010

Charter: Balance sheet

608.4

52.2

556.2

608.4

(6.7)

(74.8)

14.3

(52.5)

(180.7)

331.0

(440.7)

483.9

287.8

577.8

As at 30.06.10£m

618.3

40.0

578.3

618.3

(7.7)

(74.9)

51.8

(93.6)

(139.3)

353.0

(512.2)

573.2

292.0

529.0

As at 31.12.08£m

(53.9)Derivative financial instruments and tax liabilities

591.3Total equity

547.2Non-current assets (excluding retirement benefit assets)

238.5Inventory

426.5Current trade and other receivables

(378.8)Current trade and other payables

286.2Current net working capital

(162.2)Net retirement benefit obligations

50.9Net cash

(73.9)Provisions

(3.0)Other long-term liabilities (excluding borrowings)

591.3Net assets

549.9Equity shareholders' funds

41.4Non-controlling interests

As at 31.12.09£m

60© CHARTER 2010

Charter: Summary

• Market leadership

– ESAB: a world leader in welding with growing market share

– Howden: the global leader in air and gas handling

• Well positioned

– Business spread between developed and emerging economies

– Approximately 70 per cent of sales going either to emerging markets or the energy sector

• Manufacturing footprint

– Predominantly in low cost areas

– Timely restructuring of ESAB’s manufacturing base

• Charter – strong balance sheet

– Total Equity Shareholders’ Funds of £557 million and net cash of £14.3 million at 30 June 2010

• Dividend

– Increased dividend covered over 2.5 times by earnings

• Well positioned to deliver growth potential in both businesses

Appendix 1

62© CHARTER 2010

Chairman: Lars Emilson

Lars Emilson, 68, has led a distinguished international

business career, having held a number of senior executive

positions over many years. He has lived and worked in

Sweden, the United States and the United Kingdom. He

joined PLM AB, a Swedish pan-European packaging group

in 1970 after graduating in economics from Lund

University, Sweden and was appointed Chief Executive of

PLM in 1999 shortly before it was acquired by Rexam plc.

In 2000 he joined the Board of Rexam with responsibility

for the worldwide beverage can business, becoming Chief

Executive from 2004 to 2007. He retired from Rexam on

31 January 2007 and has subsequently become a non-

executive director of Filtrona plc.

63© CHARTER 2010

Chief Executive Officer: Michael Foster

Michael Foster, 57, joined Charter plc as a Non-

Executive Director in December 2001 and became an

Executive Director on 1 January 2005. He became

Chief Executive on 1 July 2006. He was formerly

Executive Director, responsible for UK, USA and

Ireland at RMC Group plc. He gained an Honours

Degree in Engineering and Electrical Sciences at

Cambridge University and is qualified as a solicitor.

Appendix 2

65© CHARTER 2010

Charter share price – 1 year performance

Performance of share price measured against various indexes (from 1 January 2009)

200

300

400

500

600

700

800

900

Jan-0

9Feb

-09Mar-

09Apr-

09May

-09Ju

n-09

Jul-0

9Aug

-09Sep

-09Oct-

09Nov-0

9Dec-0

9Ja

n-10

Feb-10

Mar-10

Apr-10

May-10

Jun-1

0Ju

l-10

Aug-10

Clos

ing

shar

e pr

ice

(pen

ce)

Charter FT All Share FT All Engineering FT Mid 250

66© CHARTER 2010

Charter share price – 5 year performance

Performance of share price measured against various indexes (from 1 January 2005)

0

200

400

600

800

1,000

1,200

1,400

Jan-0

5May

-05Sep

-05Ja

n-06

May-06

Sep-06

Jan-0

7May

-07Sep

-07Ja

n-08

May-08

Sep-08

Jan-0

9May

-09Sep

-09Ja

n-10

May-10

Clos

ing

shar

e pr

ice

(pen

ce)

Charter FT All Share FT All Engineering FT Mid 250

67© CHARTER 2010

Charter share price – versus Lincoln Electric

Performance of share price measured against Lincoln Electric Inc

0

100

200

300

400

500

600

700

800

900

Jan-0

9Feb

-09Mar-

09Apr-

09May

-09Ju

n-09

Jul-0

9Aug

-09Sep

-09Oct-

09Nov-0

9Dec-0

9Ja

n-10

Feb-10

Mar-10

Apr-10

May-10

Jun-1

0Ju

l-10

Aug-10

Clo

sing

sha

re p

rice

(pen

ce)

Charter Lincoln Electric

Appendix 3

69© CHARTER 2010

ESAB: Europe – manufacturing locations

St Petersburg

KatowicePerstorp

VamberkMór

Ihtiman

Karben

Opole

Laxå

Cutting and equipment factoryConsumables factory

Global R&D centre

Linkweld

Gothenburg

70© CHARTER 2010

Traverse CityAshtabula

HanoverFlorence

Monterrey

ESAB: North America – manufacturing sites

71© CHARTER 2010

Belo Horizonte

Chascomus

San LuisBuenos Aires – Acquired 2007

ESAB: South America – manufacturing sites

72© CHARTER 2010

Weihai – Consumables (2008)

Shanghai – Cutting factoryZhangjiagang – Consumables Zhangjiagang – Equipment (2008)

ESAB: China – manufacturing sites

Wuxi – two automation factories

73© CHARTER 2010

ESAB: India – manufacturing sites

74© CHARTER 2010

Howden: Europe principal locations

Coswig (fans)

Hengelo (fans)

Glasgow (Head office and compressors)Belfast (fans)

Paris (compressors)

Cartagena (heat exchangers)

Naestved (design and fans)

75© CHARTER 2010

New Philadelphia (fans)

Mexico City (fans)

Howden: North America manufacturing locations

76© CHARTER 2010

Howden: China manufacturing locations

Weihai (existing fans and heat exchangers factories)Weihai (compressors opened September 2007)

77© CHARTER 2010

JohannesburgMelbourne

Sao Paulo

Howden: rest of world

Port Elizabeth

78© CHARTER 2010

Howden: The compressor business

HCL – Acquired December 2006Paris

HCL – Acquired December 2006

Johannesburg

Glasgow

WeihaiOpened September 2007