BUYING TOMORROW’S FUTURE … TODAY

Marketing document intended

exclusively for Professional Investors

Past performance is no guarantee

of future results and is not constant over time

Johan VAN DER BIEST, Senior Fund Manager

Zurich, January 16th 2018

Robotics and Innovative Technology

The world is changing faster than everCombining AI and IoT: intelligent KONE elevators talk in human language

January 2018 Marketing document intended exclusively for Qualified Investors 2

Source: ©Kone Corporation

Why is the technological revolution still accelerating?Moore’s law

Prices of memory and storage have declined

dramaticallyComputing power doubles every 2 year

3Marketing document intended exclusively for Qualified Investors

year Average cost Per Gigabyte

1980 $ 437 500

1985 $105 000

1990 $11 200

1995 $ 1 120

2000 $ 11

2005 $ 1,24

2010 $ 0,09

2013 $ 0,05

2014 $ 0,03

2015 $ 0,022

2016 $ 0,019

Source: Statistic Brain Research Institute

Moore’s law

January 2018

What is the impact of Moore’s law?The wide availability of memory and computing power will enable a myriad of disruptive applications

Marketing document intended exclusively for Qualified Investors

10xmore viewership thanks to AI use by Youtubecompared to 2010 (source Wall Street Journal)

15 secondsis what it takes IBM Watson to ‘read’ 500k medical research papers (source IBM)

750krobo-assisted procedures in 2016 compared to 1k in 2000 (source Intuitive Surgical)

66%of US farmers is using self-driving technology (source John Deere)

$47bnestimated size of AI solutions in 2020 compared to $8bn in 2016 (source IDC)

500 millionpeople are using this translation app to talk in their native language to non-native speakers

4January 2018 4

1800 1900 2000

The world is changing, investors have to adaptFrom investing in steam power to investing in robotics and other innovative technology

Investors need to adapt, as they did in former industrial revolutions

FIRST

Industrial Revolution

Mechanical production

equipment driven by water

and steam power

e.g.: CONSOLIDATED EDISON

THIRD

Industrial Revolution

Use of electronics and

IT to further automate

production

e.g.: IBM, INTEL

SECOND

Industrial Revolution

Mass production

driven by the use of

electrical energy

e.g.: GE, SIEMENS

FOURTH

INDUSTRIAL REVOLUTION

integration of smart,

internet-connected machines and human

labour

e.g. AMAZON, ALPHABET,

YASKAWA

Marketing document intended exclusively for Qualified Investors 5January 2018

Equity investors have taken notice of the opportunityRobotics and Automation stocks have consistently outperformed

Marketing document intended exclusively for Qualified Investors 6January 2018

Robotics and automation index vs MSCI World on 10Y horizonCandriam

Robotics Fund Robo Index MSCI World

P/E 12M FWD 25.25 24.5 17

FCF yield 3.2% 3.1% 4.5%

Gross Margin 42% 35% 31.5%

R&D/Sales 12% 8.7% 5.9%

LT EPS growth (3y) 16.6% 13.8% 11.5%

Net Debt/EBITDA -1.16 -0.72 1.45

source: Bloomberg as of Jan 3rd 2018

0

50

100

150

200

250

300

350

400

ROBO Index (PI) MXWO Index (PI)

What’s the link between robotics and innovative technology?Robots have been among the biggest beneficiaries of disruptive technology

Robotics cannot be isolated from the technology sectoras machine learning and advanced robot tasks need sophisticated data centers.

The advanced robot is the ultimate fusion of state of the art hardware, software, engineering and artificial intelligence

Programming

Rockwell

Automation

Advanced

sensor

technology

Keyence

Mechatronics

Fanuc

Factory

automation

ABB

Mapping

technology

Hexagon

Cloud

computing:

Amazon

Speech

technology

Nuance

Artificial

Intelligence

Google

Marketing document intended exclusively for Qualified Investors 7Sources: company websites

January 2018

Why will robotics remain a growth sector? Some major countries and industries are still behind the curve

Marketing document intended exclusively for Qualified Investors 8

Source: IFR 2017

January 2018

631

309 303

189

68

0

100

200

300

400

500

600

700

Korea Germany Japan USA China

Robot density per 10 000 workers in 2016

Can the USA and

China afford to not

catch up?

2145

475

1261

93

1240

214

1131

181

505

180

500

1000

1500

2000

2500

Robot density per 10 000 workers automotive vs non automotive in 2016

* 2015 data

Service robots will outgrow industrial robotsThe use of robotics in healthcare is accelerating

The number of robot assisted procedures has more than doubled over the last 6 years

Sources: Intuitive Surgical

Marketing document intended exclusively for Qualified Investors 9January 2018

Long Short DigitalRobotics and Innovative Technology

10Marketing document intended exclusively for Qualified Investors

Why Candriam?A long experience in turning strong secular trends into successful investment strategies

César ZeitouniHead of Long Short Equity

22 years experience

1 year with the firm

Johan Van der BiestSenior Fund Manager

24 years experience

24 years with the firm

Candriam Technology Analysis

1 expert Automotives

4 experts Biotechnology /Health Care

2 experts Industrials/Utilities

2 experts Consumer

2 experts Financials

1 expert Energy

Candriam Advisory Board

Innovative Technologies and Robotics

Professor

Jeremy L WyattUniversity Of

Birmingham

Professor

Takeo KanadeCarnegie Mellon

University

Professor

Peter Allen Columbia

University

January 2018

The investment processA 3 stage approach

Investment universe: Global Equities, All caps

Idea generation from the Advisory Board:

• Industry Trends

• Technological Trends

At least 30% of revenues related to one or more of these thematics and market cap>250 mio USD

Robotics and Innovative Technology Screening

Industrial Robots Service Robots

Sensors Mechatronics Artificial Intelligence

Security Virtual Reality Leapfrogging Technologies

Internet of Things / Big Data

Smart Factory

Company Scorecard

Innovation Financials CompetitionManagement + Valuation

Co

mp

an

y M

eetin

gs

Sele

cte

d B

roker In

pu

t

Ind

ustry

co

nfe

ren

ces

Final portfolio30-50 stocks

Internal Risk LimitsUCIT Fund Rules

Sharpe optimisation

11Marketing document intended exclusively for Qualified InvestorsJanuary 2018

Candriam Equities L Robotics and Innovative TechnologyIndustrials and IT are prominent sectors

Marketing document intended exclusively for Qualified Investors 12

Source Candriam as 29/12/2017

January 2018

Information Technology

64%

Industrials24%

Consumer Discretionary

6%Health Care

6%

Sector distribution

Americas55%

EMEA22%

Pacific Rim23%

Regional distribution

Industrial Robots

7.1%

Service Robots

8.9%

Smart Factory29.2%

Sensors/Me-chatronics

11.4%

A.I.3.4%

I.o.T./Big Data16.2%

Security4.4%

VR/AR0.8%

Leapfrogging Technology

18.6%

Thematic exposure

Active share vs MSCI World 92.4% - Tracking Error (ex ante): 4.92% - Total risk: 10.6%

Candriam Equities L Robotics and Innovative TechnologyIndustrials and IT are prominent sectors (top 20)

Marketing document intended exclusively for Qualified Investors 13January 2018

Name Country Name Main active segments Industry Group Weight

ALPHABET INC A UNITED STATES A.I./Big Data/V.R./Leapfrogging Tech Software & Services 4.39%

FACEBOOK INC UNITED STATES A.I./Big Data/V.R./Leapfrogging Tech Software & Services 3.64%

ROCKWELL AUTOMATION INC UNITED STATES Smart Factory Capital Goods 3.42%

INTUITIVE SURGICAL INC UNITED STATES Service Robot Health Care Equipment & Servic 3.42%

SALESFORCE COM INC UNITED STATES Leapfrogging Tech/AI Software & Services 3.35%

MICROSOFT UNITED STATES A.I./Big Data/V.R./Leapfrogging Tech Software & Services 3.14%

SMC CORP JAPAN Sensors/Mechatronics Capital Goods 2.97%

OMRON JAPAN Smart Factory/Sensors/Mechatronics Technology Hardware & Equipmen 2.95%

APTIV PLC UNITED STATES Leapfrogging Tech Automobiles & Components 2.67%

APPLIED MATERIALS INC UNITED STATES Smart Factory/Leapfrogging Tech Semiconductors & Semiconductor 2.64%

KEYENCE JAPAN Sensors Technology Hardware & Equipmen 2.59%

PAYPAL HOLDINGS INC UNITED STATES Leapfrogging Tech Software & Services 2.59%

SIEMENS GERMANY Smart Factory Capital Goods 2.37%

SCHNEIDER ELECTRIC FRANCE Smart Factory/Big Data Capital Goods 2.33%

FANUC CORP JAPAN Industrial Robots/Sensors Technology Hardware & Equipmen 2.26%

IROBOT CORP UNITED STATES Service Robot Consumer Durables & Apparel 2.22%

ABB LTD SWITZERLAND Industrial Robots/Smart Factory Capital Goods 2.21%

HOLLYSYS AUTOMATION CHINA Smart Factory Technology Hardware & Equipmen 2.18%

ASML HOLDING NETHERLANDS Leapfrogging Tech Semiconductors & Semiconductor 2.11%

INFINEON GERMANY Sensors/Security/Leapfrogging Tech Semiconductors & Semiconductor 2.10%

Source Candriam as 29/12/2017

Candriam Equities L Robotics and Innovative Technology

General PhilosophyThe fund offers exposure to the secular growth theme of

robotics and innovative technology

Disciplined Investment

Process

The robotics advisory board ensures the exchange of key

strategic insights in the broad area of robotics and innovative

technology

An Experienced

Investment Team

The Thematic Global Equity team consists of seasoned

investment professionals with a proven track record.

Industry Experts

interaction

14Marketing document intended exclusively for Qualified Investors

A disciplined bottom-up process focussing on companies with

above average revenue growth, strong competitive

positioning and innovative technologies

January 2018

This document is provided for information purposes only, it does not constitute an offer to buy or sell financial instruments, nor does it represent an investment

recommendation or confirm any kind of transaction, except where expressly agreed. Although Candriam selects carefully the data and sources within this document,

errors or omissions cannot be excluded a priori. Candriam cannot be held liable for any direct or indirect losses as a result of the use of this document. The

intellectual property rights of Candriam must be respected at all times, contents of this document may not be reproduced without prior written approval.

Warning: Past performances of a given financial instrument or index or an investment service, or simulations of past performances, or forecasts of future

performances are not reliable indicators of future performances. Gross performances may be impacted by commissions, fees and other expenses. Performances

expressed in a currency other than that of the investor's country of residence are subject to exchange rate fluctuations, with a negative or positive impact on gains. If

the present document refers to a specific tax treatment, such information depends on the individual situation of each investor and may change.

The present document does not constitute investment research as defined by Article 24, paragraph 1 of the Commission Directive 2006/73/EC. Candriam stresses

that this information has not been prepared in compliance with the legal provisions promoting independent investment research, and that it is not subject to any

restriction prohibiting the execution of transactions prior to the dissemination of investment research.

Candriam consistently recommends investors to consult via our website www.candriam.com the key investor information document, the prospectus, and all other

relevant information prior to investing in one of our funds. These documents are available either in English or in local languages for each country where the fund’s

marketing is approved.

Specific information for Swiss investors: The appointed representative and paying agent in Switzerland is RBC Investors Services Bank S.A., Esch-sur-Alzette, Zürich

branch, Badenerstrasse 567, CH-8048 Zürich. The prospectus, the key investor information, the articles of association or the management rules as well as the annual

and semi-annual reports, each in paper form, are made available free of charge at the representative and paying agent in Switzerland.

15January 2018 Marketing document intended exclusively for Qualified Investors

www.candriam.com