ROCE 5.1% 8.7% 10.0% S&T AG Net Debt Equity -0.1 -0.2 -0.3 20 · 2019-03-03 · SWOT Analysis 16 Financials 17 Segment sales 17 Earnings development 19 Cash Flow Analysis 20 ... Check

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Full Company Report Reason: Initiation of Coverage 28 November 2017

Rapid evolution of the IoT and Embedded market

S&T AG (SANT) is an Austrian company listed in the German TecDax index.

The company grew via acquisitions in the past and operates now under three

pillars: IT Consulting and Services (40% of FY17 revenue), IoT (40%) and

Embedded Solutions (20%), the latter of which is comprised of its latest

Kontron acquisition. SANT operates in robustly growing Eastern European

markets as well as in the DACH region and high growth areas such as IoT and

embedded technologies, in which we see CAGRs of 10% to 15% for FY17-21e.

We believe that SANT can expand its gross margin from currently 34% to 40%

by FY21 and switch to a recurring revenue model with 60-70% of total group

revenues. We initiate coverage with a BUY rating and a DCF-based target

price of EUR 21.00 per share.

In our base case scenario we see SANT´s revenue to increase in the FY17-21e

period by 10% p.a. EBITDA should rise over-proportionally (CAGR FY17-21e:

18%) as SANT currently streamlines Kontron´s operations and should

significantly benefit from its partnership with Foxconn/Ennoconn in cross-selling

their product pipeline with more than 1,000 designs p.a.

A healthy balance sheet (net cash: FY19 EUR 140m+) and future high cash

conversion (EUR 50-75m p.a.) should help SANT to further consolidate the IT

services market in the DACH and EE region. Bolt on acquisitions will then help

to penetrate more into key customer groups for machine to machine

communication and connectivity in industrials, automation, gaming, avionics or

health and medical sectors. SANT´s IoT products and embedded solutions

should help bring Industry 4.0 forward.

Currently, we view SANT as a pure growth play and market share gainer with its

strong foothold in the DACH and EE region. With its Foxconn/Ennoconn

partnership and the successful roll-out of new products such as smart metering

devices, we estimate that SANT is able to keep capex, R&D spend as well as

depreciation levels low (1-2% p.a. on sales) and turn into a highly cash

generative entity by FY18. The successful turnaround of Kontron enables SANT

to cross-sell its embedded as well as security and Industry 4.0/IoT appliances to

Kontron´s vast customer base with more than 4m installed hardware devices.

We have conducted a DCF, a peer group valuation and a SOTP valuation for

SANT´s three different business units. In our opinion, a DCF based target price

of EUR 21.00 per share is the most suitable valuation method for SANT, as the

company transforms from a pure low growth IT services firm into a high growth

IoT and Embedded solutions provider, with high recurring software revenue

streams and predictability of cash flows going forward.

We view SANT as a highly attractive growth story for the next five years with

1) a growing IoT and embedded market 2) Kontron´s successful turnaround in

FY17 3) move into software solutions and hence recurring revenue streams and

4) further margin expansion in coming years. Additionally, SANT could be seen

as an attractive M&A target for Ennoconn, holding already 22% of SANT

shares. Hence, we initiate coverage on SANT with a BUY rating and DCF-

based target price of EUR 21.00 per share.

S&T AG

Germany | Technology Hardware & Equipment Investment Research

Analyst(s)

Cengiz Sen

[email protected]

+4969 58997 435

Buy

17.53closing price as of 27/11/2017

21.00

19.8%Upside/Downside Potential

Target Price unchanged

Recommendation unchanged

Target price: EUR

Share price: EUR

Reuters/Bloomberg SANT1.DE/SANT GY

Market capitalisation (EURm) 1,009

Current N° of shares (m) 58

Free float 63%

Daily avg. no. trad. sh. 12 mth 206

Daily avg. trad. vol. 12 mth (m) 2,187.76

Price high/low 12 months 8.25 / 19.08

Abs Perfs 1/3/12 mths (%) 4.75/4.44/80.39

Key financials (EUR) 12/16 12/17e 12/18e

Sales (m) 504 870 1,001

EBITDA (m) 34 63 78

EBITDA margin 6.8% 7.2% 7.8%

EBIT (m) 24 44 55

EBIT margin 4.8% 5.0% 5.5%

Net Profit (adj.)(m) 15 31 43

ROCE 5.1% 8.7% 10.0%

Net debt/(cash) (m) (32) (79) (101)

Net Debt Equity -0.1 -0.2 -0.3

Net Debt/EBITDA -0.9 -1.3 -1.3

Int. cover(EBITDA/Fin.int) 8.5 18.9 37.4

EV/Sales 0.9 1.2 1.1

EV/EBITDA 12.8 16.4 14.2

EV/EBITDA (adj.) 12.8 16.4 14.2

EV/EBIT 18.2 23.6 20.2

P/E (adj.) 26.3 32.2 26.1

P/BV 2.5 3.8 3.7

OpFCF yield 12.6% -3.4% 2.6%

Dividend yield 0.5% 0.4% 0.5%

EPS (adj.) 0.33 0.54 0.67

BVPS 3.50 4.63 4.76

DPS 0.08 0.08 0.08

Shareholders

Ennoconn Corp. 22%; JPMorgan Asset Management (UK) Ltd.

5%; Allianz Global Investors GmbH 4%;

8

10

12

14

16

18

20

Okt 16 Nov 16 Dez 16 Jan 17 Feb 17 Mrz 17 Apr 17 Mai 17 Jun 17 Jul 17 Aug 17 Sep 17 Okt 17 Nov 17

vvdsvdvsdy

S&T AG Tec Dax (Rebased)

Source: Factset

S&T AG

Page 2

CONTENTS

Investment Case and Market Environment 5

Kontron´s turnaround and IoT market growth 5

Moving into recurring revenue streams 6

Gross margin improvement program 8

Valuation 10

DCF valuation assumptions 10

Multiple comparison 11

- Peer group constituents: IT Services 13

- Peer group constituents: Smart Metering 13

- Peer group constituents: Appliance Security 14

- Peer group constituents: Embedded Solutions 15

Triggers & Swot Analysis 16

SWOT Analysis 16

Financials 17

Segment sales 17

Earnings development 19

Cash Flow Analysis 20

Working Capital 21

Equity & Debt 22

ROE 22

Company Profile & Market Environment 24

Company overview 24

Management 25

Shareholder structure 26

Divisional set up 26

S&T AG

Page 3

Investment case in six charts

Exhibit 1: Turnaround success at Kontron Exhibit 2: Foxconn / Ennoconn partnership and synergies

Source: equinet research Source: equinet research

Exhibit 3: Full project pipeline and scheduled orders Exhibit 4: Revenue split and EBIT margin development

Source: S&T AG, equinet research Source: equinet research

Exhibit 5: Total IoT market expectation Exhibit 6: Connected devices

Source: S&T AG, equinet research Source: Ericsson, equinet research

Backlog EUR m

(wo Kontron)

Dec-13 Dec-14 Dec-15 Dec-16 Mar-17 Jun-17

Project Pipeline 308 644 701 1002 1012 1016Scheduled Orders 97 157 181 306 320 463

0.00

5.00

10.00

15.00

20.00

25.00

30.00

2014 2015 2016 2017e 2018e 2019e 2020e 2021e

Celular IoT

Non-cellular IoT

PC/laptop/tablet

Mobile phones

Fixed phones

Program Description Status Completed Impact on financials

Dragon 2Outsourcing of manufacturing

to Foxconn/Ennoconn30% implemented Dec 2018

EUR 200m material cost

reduction with 300bps GM

improvement

Dragon 4

Foxconn delivers HW

embedded products, SANT

provides SW solution

Open 2021 EUR 400m revenue addition

Dragon 5

Leverage Foxconn R&D

design and new product

offensive

15% completed Dec 2017 EUR 4m R&D cost savings

Rising Sun

Market penetration into China

via IoT volume products via

Ennoconn, non-volume and

high margin products via

Kontron China


Dragon 6

Address large accounts, sell

volume IoT products via

Foxconn, high margin

services and upgrades via

SANT

Started 2018 EUR 4m in cost savings

Op. loss 2016

Head cost

reduction

Consultant

reduction

Gross Margin

improvements

Merger

synergies Profit 2017

-29

12

6

14

8 11

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

4.0%4.4%

4.8%5.0%

5.5%

6.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

0

200

400

600

800

1,000

1,200

IoT Solutions Embedded Systems

IT Services EBIT margin

Products available in 2016 Expected market size CAGR Significance for SANT

Embedded boards US$ 3.2bn 8% low

Embedded systems US$ 3.5bn 10% middle

Connectivity US$ 16bn 17% high

Services US$ 58bn 16% important

Total IoT market by 2020 US$ 9,400bn 18% significant

S&T AG

Page 4

S&T at a glance

Exhibit 7: Business units and other valuable tidbits

Source: S&T AG, equinet research

Business Units

Guidance (15/05/2017): equinet Estimates

Revenue: Revenue:y/y y/y

EBIT EBIT

CEO CEO CFO

COO Managing Dir.

# of employees FY

2016

Only reasonable data from SANT`s prospectus reveals market share for Advantech of 8%,

Siemens 6% and AdLink of 3% in the European Econimc Area (EWR)

Outsourcing and cost cutting main drivers for GDP-like growth for SANT in IT Services.Connectivity of devices and increased need for secure platforms in M2M, smart metering

and other applications drive market growth and innovation in IoT.

System-on-a Chip, enhanced software solutions and niche but customized solutions in the

automation, infotainment, medical and transportation segments.

Bechtle, Cancom, HPE, IBM, Accenture, Asseco, Capgemini, Atos and other IT services

companies

Check Point Software, Intel, FireEye, Imperva, Secunet, Compugroup, Vitec Software AB

Smart Energy: Landis & Gyr, Schneider Electric, Siemens, Itron, IBM, Cisco, ABB Advantech, AdLink and Siemens

3,786

Shareholder

structure &

management

Hannes Niederhauser Michael Jeske Richard Neuwirth

CEO (since 2011)

• Hannes Niederhauser joined the company in 2011 as

CEO. Following his studies in electrical engineering at the

Graz University of Technology, the Austrian-born manager

worked as a developer of microchips and in the embedded

computer segment. Prior he has been the main shareholder

and CEO of Kontron AG from 1999 to 2007, which became

the world’s largest provider in the field of embedded

computing.

COO (since 2009)

• Michael Jeske - CEO of S&T AG since mid-2009 -

gathered extensive experience in the area of technology

after obtaining a technical degree at the university and was

also Vice President Operations at Kontron AG. He has

years of management experience in the IT industry behind

him and has distinguished himself professionally, particularly

in the areas of development, production and quality

assurance.

Carlos Queiroz

CFO (since 2013)

• Richard Neuwirth has degrees in jurisprudence and business

administration. He began his career as a lawyer working for a Vienna-

based firm. He joined S&T in 2006, and has held a variety of

management positions at it, with these including managing director of S&T

Bulgaria and country manager and sales director of S&T Austria.

As of July 2013, Neuwirth became the company's CFO.

Shareholder structure

Dr. Peter Sturz

COO (since 2008)

•Dr. Peter Sturz is responsible for Eastern Europe. He

joined the group in 2007 and was initially appointed

regional manager for the Adriatic region. Before joining

S&T, Dr. Sturz was the member of the management board

of the US IT-services provider CSC, responsible for Austria

and Eastern Europe. His professional career began in

1983 at the Allgemein Bausparkasse, where he finally

served as the management board member responsible for

sales, marketing and IT. Dr. Sturz is a qualified lawyer and

holds a doctorate from the University of Vienna.

Managing Director (since 2015)

•Carlos Queiroz has been active in the embedded industry

for over 30 years and started his career as a development

engineer. At Kontron he held a variety of management

positions and was the Managing Director of the German

GmbH organization from 2000 to 2015. In 2015 he joined

the S&T Group assuming a Managing Director position

before he was appointed to the Management Board

Sales & EBIT Split

Sales split by region Sales split by division EBIT split by region Group financial development

Margin 4.8% Organic growth y/y 13.5%

EBIT adj. (EURm) 24.1 Sales 5Y hist. CAGR 26.9%2016

Sales (EURm) 503.7 EBITDA (EURm) 34.4

y/y Margin 6.8%

73.0%

14.0% - 15.0% 5.0% 3.6%

EUR 865m EUR 871m17.3% 73.0%

Main competitors

EUR 871m

Drivers

Market share/

positioning

Customers

Below 1% in SANT´s footprint Below 1% in SANT´s footprint

Communications and avionics customersIndustrial applications such as robotics, automotive, health care, avionics, gaming and

other high-end niche IoT marketsSmall and mid-sized enterprises in DACH and Eastern European region

Entry barriers/

competitive

advantage

High personnel and R&D intensive business, especially in IT Services (personnel) and Embedded Systems (R&D/pre-financing). SANT has high economies of scale/scope once embedded products are developed and software products included . SANT has a low cost

base (c. 50% of workforce is located in low cost Eastern European countries), highly outsourced production to Foxconn and Ennoconn in China and Canada respectively, a strong customer retention effort (e.g. trying to become single source supplier for automotive,

industrial, aerospace and energy sector), only embedded and smart metering supplier and services provider with a strong Eastern European production footprint, strong IP portfolio.

Strategy & Guidance

Strategy:

(I) Profitable and cash generating growth

(II) Benefit from megatrends (increased device and machine connectivity, security/firewall requirements, outsourcing)

(III) Further develop new innovative software solutions in embedded computing, security applications and smart metering

(IV) Maintain & strengthen cost and quality leadership and bring gross margin to 40%+ levels

Consensus

Products/

applications

IT services to small and mid-sized enterprises, IT integration and focus on security

applications

Applications dedicated to vertical markets with e.g. security offerings for machines (IoT),

software in IoT grid, operation of IoT services (cloud, on-premise)

Embedded hardware and software solutions, customized products for niche applications

with long-term recurring contracts

IT Services IoT Solutions Embedded Systems

8%

10%

9%

6%

55%

12%

Germany

Poland

Romania

Russia

RoW

Austria

32%

8%

24%

18%

14%

4%

IT Services

Services DACH

Services EE

IoT Solutions

AppliancesSecurity

Appliances SmartEnergy

32%

8%

24%

18%

14%

4%

IT Services

Services DACH

Services EE

IoT Solutions

AppliancesSecurity

Appliances SmartEnergy

4.0%4.4%

4.8%5.0%

5.5%6.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

0

200

400

600

800

1,000

1,200

IoT Solutions Embedded Systems

IT Services EBIT margin

22.4%

5.1%

3.8%

3.2%

2.9%

2.0%

60.7%

Ennoconn Corp.

JPMorgan AssetManagement

(UK) Ltd.Allianz GlobalInvestors GmbH

Dorval AssetManagement SA

Erhard F.Grossnigg

HannesNiederhauser

(CEO)

S&T AG

Page 5

Investment Case and Market Environment

We have identified three main pillars for investors to bet on our investment case and a further re-rating of SANT shares. The first pillar of SANT´s continued success story is Kontron´s return to its growth path utilizing its huge installed base of more than four million embedded computers and SANT´s expertise in software deployment on Kontron´s hardware solutions. The second pillar is based on the success of penetrating the Internet of Things market and expansion of SANT´s gross margin via value added software solutions and transformation of Kontron into a full hardware and software solutions provider. Our third investment pillar for SANT is a successful implementation of business opportunities with recurring revenues and cash flow streams for the group. This should be realized via its Appliances Security and Smart Metering business unit.

Kontron´s turnaround and IoT market growth

According to a research paper released by Ericsson in mid-2017, mobile phones continue to be the largest category of connected devices. It seems that 2018 they are expected to be surpassed by IoT devices, which include connected cars, machines, utility and smart meters, medical devices, consumer electronics, military and defence applications. IoT devices are expected to increase at a CAGR of 22% from 2015 to 2021. In total, around 28bn connected devices are forecasted by 2021 according to SANT estimates with a total IoT market size of around US$ 9.4tn in 2020. The average value of embedded systems is currently EUR 948 per device but should significantly increase with all connected devices and software solutions in an IoT world to more than EUR 2,200 by 2020.

Exhibit 8: IoT market size in 2020 Exhibit 9: Connected devices by 2021

Source: S&T AG, equinet research Source: S&T AG, Ericsson, equinet research

SANT should clearly benefit from this ongoing trend and take a good chunk of market share in this segment. Currently, we estimate that Kontron´s total market share in this embedded segment is around or below 1%. With a combined effort and partnership with Foxconn / Ennoconn, we estimate that Kontron could fetch a market share of above 3% worldwide in IoT and embedded solutions. Contrary, Foxconn / Ennoconn target the Western and Eastern European markets with the distribution power and alliance of SANT. Here we estimate that Advantech is the clear market leader with a 8% market share, followed by Siemens (6%) and AdLink at around 3%.

Within IoT, two major market segments with different requirements are emerging: massive and critical applications.

Products available in 2016 Expected market size CAGR Significance for SANT

Embedded boards US$ 3.2bn 8% low

Embedded systems US$ 3.5bn 10% middle

Connectivity US$ 16bn 17% high

Services US$ 58bn 16% important

Total IoT market by 2020 US$ 9,400bn 18% significant

Connected devices in bn units FY15 FY21e CAGR 2015-2021e

Celular IoT 0.4 1.5 27%

Non-cellular IoT 4.2 14.2 22%

PC/laptop/tablet 1.7 1.8 1%

Mobile phones 7.1 8.6 3%

Fixed phones 1.3 1.4 0%

S&T AG

Page 6

Massive IoT connections are characterized by low cost, low energy consumption and small data traffic volumes. Examples include smart buildings, transport and logistics, fleet management, smart meters and agriculture.

Critical IoT connections are characterized by requirements for ultra-reliability and availability, with ultra-low latency. Examples include traffic safety, autonomous cars, industrial applications, remote manufacturing and healthcare, including remote surgery. For example, in today´s world, LTE’s share of cellular IoT device penetration is around five percent. Cost reductions will make LTE-connected devices increasingly viable, enabling new, very low latency applications. 5G capabilities are expected to extend the range of addressable applications for critical IoT deployments. With increased deployments, companies such as SANT / Kontron will benefit further as between 2015 and 2021, IoT connections are expected to grow with a CAGR of 22%. Over that time, Western Europe will add the most connections, led by growth within the connected car segment and industrial applications such as connected and intelligent automation processes.

Kontron is now in a comfortable situation after SANT management turned around the company and paved the way for future growth. SANT immediately tackled working capital issues and stopped liquidity drain while renegotiating bank loans to hold key customers on board.

Exhibit 10: EBIT improvement of Kontron in FY17

Source: S&T AG, equinet research

We expect Kontron to contribute around EUR 11m in EBIT and EUR 15m in EBITDA to SANT´s FY17 P&L and reach an EBIT margin of around 8-10% in coming years with new product offerings in embedded hardware and software and the partnership with Ennoconn.

Moving into recurring revenue streams

With the successful turnaround of Kontron, we feel that Kontron is well prepared to move from a pure hardware to an IT and Industry 4.0 machine integrator as more and more machines require integration and communication between each other.

The ultimate goal of this trend is to switch from a pure “box-seller” of hardware devices in the “old-embedded” world, to a full embedded software and cloud IT integrator with recurring revenue streams. This trend should be enabled via its Ennoconn partnership, to provide OEMs with an individual/customized and coordinated product and service portfolio

Op. loss 2016

Head cost

reduction

Consultant

reduction

Gross Margin

improvements

Merger

synergies Profit 2017

-29

12

6

14

8 11

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

S&T AG

Page 7

that enables them to offer their customers all tools necessary for future-proof Industry 4.0 and IoT applications.

In an IoT and Industry 4.0 scenario, all product, process and production data is aggregated. The challenge for companies here is combining data from very different sources such as CAD, product data, ERP systems and CRM systems in general. Under such circumstances, the applications of enterprise IT (information technology) and OT (operational technology/production environment) eventually merge. In Industry 4.0 application computers deployed on-premise form an embedded cloud. Real-time requirements and security considerations result in data storage processing on-site. Most computing tasks are therefore performed in an embedded cloud within the physical boundaries of the company.

All equipment used outside the data center (i.e. somewhere on campus) must be suited for use in an industrial environment. In addition, the entire embedded cloud must have a thorough security concept. Currently two types of companies are providing to the emerging field of embedded cloud applications: vendors of generic IT and automation technology providers. Both are only addressing part of the embedded cloud sphere.

Kontron in contrast, together with its partners Ennoconn and S&T, covers the whole range of products and requirements. Kontron covers the whole value chain from the embedded computer systems (hardware) on the factory floor right up to the cloud servers of the IT world (software and security appliances). This is a unique advantage because not only do customers benefit from an in-depth understanding of industrial requirements. IT also helps to overcome barriers between IT and OT departments that currently exist within many organizations. Now they have one single partner and supplier at hand who thoroughly understands the challenges and requirements of both sides, which can turn out to be a key success factor.

With its current product range, Kontron is already well equipped for the embedded cloud. When planning industrial 4.0 architectures, however, customers have expressed the clear need for an integrated, scalable and networked solution: the embedded server.

Kontron is working on an implementation of this concept that combines the computing and storage capacity of cloud servers (300+ cores and a storage capacity of 100+ TB) with the robustness of industrial servers (extended temperature range, shock and vibration resistance). Kontron in the longer term will benefit from these outsourcing trends and should benefit from its installed base of embedded computers of more than four million devices worldwide. This should help to achieve recurring revenues of 60% of total revenues by FY20 and start significant cross-selling potential of Kontron´s and SANT´s diverse customer base.

Exhibit 11: Project pipeline, scheduled orders and gross margin development

Source: S&T AG, equinet Research

Gross Margin32.9% 33.0% 33.9% 33.5% 35.0%

Backlog EUR m

(wo Kontron)

Dec-13 Dec-14 Dec-15 Dec-16 Mar-17 Jun-17

Project Pipeline 308 644 701 1002 1012 1016Scheduled Orders 97 157 181 306 320 463

2013 2014 2015 2016 2017e

Embedded

IoT Appliances

Services

338338

EUR m

504

> 860

385468

S&T AG

Page 8

Gross margin improvement program

SANT offers appliances dedicated to special and niche vertical markets such as aviation, POS, medical, automation, robotics, gaming and other business and consumer electronics. SANT targets to expand its gross margin via Kontron´s strong foothold and current collaboration with Ennoconn/Foxconn to widen its product range and cross-sell Foxconn´s product pipeline and design wins for over 1,000 new launches p.a. The partnership foresees a conversion of Kontron´s embedded technology into IoT applications with two-to-three year recurring revenue for service, maintenance and up-grading contracts. We feel that Foxconn will support SANT to achieve leadership in IoT and Industry 4.0 with Germany and Western Europe as a prime target for Foxconn/Ennoconn and exploit significant future synergy potential to further leverage its operations and enhance gross margins as well as EBITDA margins to levels of its Security Appliance business (gross margin FY16: 48% vs. 34% for the group).

Exhibit 12: Gross margin and EBITDA group target Exhibit 13: Synergy potential with Foxconn partnership

Source: S&T AG, equinet research Source: S&T AG, equinet research

We estimate that the total impact will be around EUR 430m in additional revenue for SANT by FY21. Savings of up to EUR 200m in production and material cost with a decent gross margin improvement of 300bps by end FY18 and smaller savings in R&D of around EUR 8m during the course and implementation phase of these different programs. Foxconn/Ennoconn will, in our view, support SANT to achieve leadership in IoT and Industry 4.0 in the long run and enhance its footprint in the European Smart Metering as well as embedded market.

M&A transaction and full take-out of SANT

The outlook for owners in IT services firms is excellent as acquirers are looking more and more for M&A transactions in cyber security, cloud computing, embedded security and software solutions companies. These areas are critical and have highest investment priorities for management and underpin strong demand for relevant M&A opportunities from buyers across industries over 2017.

Notable transactions in the IT services world are listed below and reveal a healthy premium regarding different deal sizes with an average EV/Sales multiple of around 2-3x and 15x EV/EBITDA paid.

SANT could be worth EUR 2bn to EUR 3bn on our FY18 sales estimates of EUR 1bn or around EUR 1.2bn on our FY18 EBITDA estimates of EUR 78m.

FY16 Gross margin EBITDA

Security Appliances 48% 15%

S&T group 34% 7%

Deviation 1480 BP 790 BP

Program Description Status Completed Impact on financials

Dragon 2Outsourcing of manufacturing

to Foxconn/Ennoconn30% implemented Dec 2018

EUR 200m material cost

reduction with 300bps GM

improvement

Dragon 4

Foxconn delivers HW

embedded products, SANT

provides SW solution


Dragon 5

Leverage Foxconn R&D

design and new product

offensive

15% completed Dec 2017 EUR 4m R&D cost savings

Rising Sun

Market penetration into China

via IoT volume products via

Ennoconn, non-volume and

high margin products via

Kontron China


Dragon 6

Address large accounts, sell

volume IoT products via

Foxconn, high margin

services and upgrades via

SANT

Started 2018 EUR 4m in cost savings

S&T AG

Page 9

Exhibit 14: Notable IT Services M&A transactions and paid multiples

Source: Solganick & Co., equinet Research

Deal Date Target Buyer Description Deal Size (US$ m) EV/ Revenue EV/ EBITDA

Apr 17 SinnerSchrader AccentureProvider of project management

and consulting services100 2.8x 23.0x

Apr 17 DXC TechnologyComputer

Sciences

Provider of next-generation

information technology services

intended to offer outsourcing and

information technology

transformation services

7,607 1.0x 12.6x

Dec 16 ASG Group

Nomura

Research

Institute

Provider of information technology

services in Australia.256 1.8x 13.0x

Dec 16 StratoUnited

Internet

Provider for the hosting of cloud

computing services.633 4.7x 12.4x

Average 2.6x 15.3x

w /o SinnerSchrader 12.7x

S&T AG

Page 10

Valuation

We value SANT at EUR 21.00 per share and rate the stock as a BUY. This valuation is derived from our DCF (fair value: EUR 21.00 per share) model. Due to SANT´s different segments, we also show a SOTP valuation with different implied valuations using different peer companies as described in the Peer Multiples section and shown in the table below using EV/Sales, EV/Gross Profit, EV/EBIT and P/E multiples for our FY17-19e estimates.

DCF valuation assumptions

Sales development: We expect SANT’s group sales to increase by 15% to EUR 1bn in FY18e which is in line with the management guidance, and realistic in our view as we believe that management is overly cautious after the Kontron merger. For the FY17-26e period, we expect the company to show a CAGR of 7% in our DCF model based on further growth in embedded solutions, cross-selling impact via its IT services segment used as a “door-opener” for additional IoT and embedded business as well as due to new account and design wins going forward. In Phase II of the DCF model, sales growth fades down to 4% (FY21-26e).

Profitability: Earnings will benefit from economies of scale and SANT´s outsourcing production agreement with Foxconn as well as Ennoconn´s large embedded IP engineering potential with more than 1,000 designs p.a. In Phase I of our DCF model, we use an average EBIT margin of 6.3%. For Phase II we have applied an average operating margin level of 8.4%, which might appear too conservative.

Capex: Capex requirements of SANT´s business model are usually low. We assume that SANT will not spend more than 1.5% of sales over the periods displayed in our DCF model.

WACC: Using a beta of 1.15 and a target equity ratio of 70%, we arrive at a WACC of 7.9%.

Perpetuity: We calculate with 2% cash flow growth into perpetuity.

DCF fair value: Based on our DCF calculation, we see SANT’s fair share value at EUR 21.00.

Exhibit 15: DCF valuation and equinet assumptions

Source: equinet Research

Phase III

EUR m 2017e 2018e 2019e 2020e 2021e 2022e 2023e 2024e 2025e 2026e

Revenues 870 1,001 1,101 1,189 1,278 1,362 1,439 1,507 1,565 1,611

growth rate 72.7% 15.0% 10.0% 8.0% 7.5% 6.6% 5.7% 4.8% 3.8% 2.9%

EBIT 44 55 66 83 102 111 119 126 133 139

EBIT margin 5.0% 5.5% 6.0% 7.0% 8.0% 8.1% 8.2% 8.4% 8.5% 8.6%

Tax -3.3 -4.7 -6.3 -8.7 -12.3 -13.8 -15.4 -17.0 -18.6 -20.1

Tax rate 8% 9% 10% 11% 12% 13% 13% 14% 14% 15%

Depr. & Amort. 19.1 23.0 27.5 23.8 19.2 19.9 20.8 21.7 22.4 23.0

% of sales 2.2% 2.3% 2.5% 2.0% 1.5% 1.5% 1.4% 1.4% 1.4% 1.4%

Capex -18.6 -18.8 -18.8 -19.0 -19.2 -20.4 -21.6 -22.6 -23.5 -24.2

% of sales 2.1% 1.9% 1.7% 1.6% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5%

Change in WC & P -71.7 -23.7 -16.0 -12.5 -11.9 -12.7 -13.4 -14.0 -14.6 -15.0

% of sales 8.2% 2.4% 1.5% 1.1% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9%

Free Cash Flow -31.0 30.9 52.5 66.7 78.1 83.6 89.0 94.0 98.5 102.3 1,773.0

growth rate nm nm 70.0% 27.1% 17.1% 7.1% 6.5% 5.7% 4.8% 3.8% 2.0%

Present Value FCF -30.7 28.4 44.7 52.7 57.2 56.8 56.0 54.9 53.3 51.3 888.5

PV Phase I 152 Risk free rate 3.5% Targ. equity ratio 70%

PV Phase II 272 Premium Equity 5.0% Beta 1.15

PV Phase III 888 Premium Debt 2.0% WACC 7.9%

Enterprise value 1,313 Sensitivity

- Net Debt (Cash) -85 1.0% 1.5% 2.0% 2.5% 3.0%

- Pension Provisions 2 7.1% 21 23 24 26 29

- Minorities & Peripherals 87 7.5% 20 21 22 24 26

+ MV of financial assets 0 WACC 7.9% 18 19 21 22 24

- Paid-out dividends for last FY 6 8.3% 17 18 19 20 22

+/- Other EV items 8.7% 16 17 18 19 20

Equity value 1,303

Number of shares 63.4

Value per share (€) 21

Current Price (€) 18.1

Upside 14%

Phase I Phase II

Growth in phase III

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Multiple comparison

We have applied a classical peer analysis consisting of SANT´s closest peers and competitors from Germany, Eastern Europe and Asia pacific. Additionally we have split peers into four different segments and applied a SOTP valuation taking different metrics and multiples reflecting SANT`s IT Services, IoT, Smart Metering and Embedded Solutions divisions. Nevertheless, we have based our target price on our DCF calculation. Our DCF-based target price implies an upside potential of c. 20%.

Exhibit 16: Peer Group Valuation


Fair value: On average, the peer group consideration results in a fair value for SANT between EUR 17.00 to EUR 40.00 on our FY18e estimates.

Exhibit 17: Peer Group Valuation


SOTP valuation: Subtracting Kontron minorities (see Exhibit 19), we derive a fair value for SANT´s business on our FY18 EBITDA estimates and multiple assumptions of EUR 21.00 per share. In our bull and bear case scenario with different growth assumptions and operating margin expectations our fair value range for SANT is between EUR 13.00 and EUR 22.50 per share on our FY18 estimates.

Exhibit 18: Peer Group Valuation by segments


Peer-group multiples

2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e

ACP-WAR 0.6 0.6 0.6 5.8 5.7 5.5 11.4 11.7 11.2 3.2 3.1 2.9

BC8-ETR 0.8 0.8 0.7 17.6 15.8 14.4 25.9 23.1 20.9 5.5 5.1 4.7

COK-ETR 1.0 0.9 0.9 17.8 14.7 12.6 26.0 21.7 18.9 3.5 3.1 2.9

D6H-ETR 1.4 1.1 1.0 17.2 11.9 10.6 30.0 20.4 17.8 1.9 1.5 1.4

BMI-USA 3.3 3.1 3.0 23.3 20.7 19.5 35.7 31.8 28.1 8.6 8.1 7.9

ITRI-USA 1.3 1.2 1.1 16.2 12.6 9.0 21.4 18.3 14.6 3.9 3.6 3.2

LAND-SWX 1.3 1.3 1.2 17.7 14.7 12.7 18.7 15.5 13.6 4.1 3.9 3.7

SMS-LON 10.3 8.6 7.4 33.0 25.7 20.0 33.9 27.1 22.7 20.5 16.9 14.2

YSN-ETR 4.2 3.8 3.4 29.2 25.9 22.4 46.0 40.8 35.3 16.8 14.5 12.4

SOPH-LON 4.8 4.1 3.5 137.2 71.0 36.5 101.9 63.9 41.2 6.3 5.3 4.5

2395-TAI 3.1 2.8 2.5 19.5 16.5 14.6 23.4 20.7 18.3 7.7 6.8 6.0

6166-TAI 1.2 1.1 1.0 20.3 13.2 10.6 28.7 17.4 13.9 3.1 2.7 2.4

Sector Min 1.5 1.3 1.2 13.0 12.6 11.8 22.5 19.2 17.0 4.3 3.9 3.6

Sector average 2.8 2.4 2.2 29.6 20.7 15.7 33.6 26.0 21.4 7.1 6.2 5.5

Sector Max 4.1 3.5 3.1 46.1 28.8 19.6 44.7 32.8 25.8 9.9 8.5 7.5

S&T multiples 1.2 1.0 0.9 23.9 18.5 14.8 35.7 26.3 21.1 3.3 2.9 2.5

% premium to sector average -56.9% -58.4% -59.4% -19.1% -10.5% -5.9% 6.4% 1.0% -1.1% -54.1% -54.0% -54.2%

EV/Sales EV/EBIT P/E EV/GP

S&T implied valuation (EUR m)

2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e

equinet estimates 870 1001 1101 44 55 66 31 43 53 320 356 387

EV Min 1270 1347 1368 565 694 778 703 818 899 1381 1395 1383

EV average 2413 2446 2401 1285 1138 1036 1051 1107 1131 2266 2211 2129

EV Max 3556 3544 3434 2005 1581 1294 1400 1397 1364 3152 3028 2875

Net (debt)/cash 79 101 144 79 101 144 79 101 144

Equity Value 2493 2547 2545 1365 1239 1180 1051 1107 1131 2346 2312 2273

No. of shares (m) 63 63 63 63 63 63 63 63 63 63 63 63

Implied average price (EUR) 39 40 40 22 20 19 17 17 18 37 36 36

Sales EBIT Net income GP

Peer-group multiples IT Services

2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e 2017e 2018e 2019e

ACP-WAR 0.6 0.6 0.6 4.1 4.1 4.0 5.8 5.7 5.5 11.4 11.7 11.2 3.2 3.1 2.9

BC8-ETR 0.8 0.8 0.7 14.9 13.5 12.3 17.6 15.8 14.3 25.8 23.0 20.9 5.5 5.1 4.7

COK-ETR 1.0 0.9 0.9 13.4 11.4 10.1 17.8 14.7 12.6 26.0 21.7 18.9 3.5 3.1 2.9

D6H-ETR 1.4 1.1 1.0 12.6 9.5 8.6 17.1 11.8 10.6 29.8 20.3 17.7 1.9 1.5 1.4

Sector average 0.9 0.9 0.8 11.3 9.6 8.8 14.6 12.0 10.8 23.3 19.2 17.2 3.5 3.2 3.0

Peer-group multiples Smart Metering


BMI-USA 3.3 3.1 3.0 17.7 16.2 15.0 23.3 20.7 19.5 35.7 31.8 28.1 8.6 8.1 7.9

ITRI-USA 1.3 1.2 1.1 11.0 9.3 7.7 16.2 12.6 9.0 21.4 18.3 14.6 3.9 3.6 3.2

LAND-SWX 1.3 1.3 1.2 10.9 9.6 8.7 17.7 14.7 12.7 18.7 15.5 13.6 4.1 3.9 3.7

SMS-LON 10.3 8.6 7.4 20.7 15.9 12.8 33.0 25.7 20.0 33.9 27.1 22.7 20.5 16.9 14.2

Sector average 4.1 3.6 3.2 15.1 12.7 11.0 22.5 18.4 15.3 27.4 23.1 19.7 9.3 8.1 7.2

Peer-group multiples Appliance Security


YSN-ETR 4.2 3.7 3.3 25.8 22.9 19.9 29.0 25.7 22.3 45.8 40.6 35.1 16.7 14.4 12.4

SOPH-LON 4.8 4.1 3.5 16.7 14.0 11.6 137.2 71.0 36.5 101.9 63.9 41.2 6.3 5.3 4.5

Sector average 4.5 3.9 3.4 21.3 18.5 15.7 83.1 48.3 29.4 73.8 52.3 38.1 11.5 9.8 8.4

Peer-group multiples Embedded Solutions


2395-TAI 3.1 2.8 2.5 17.7 14.8 13.2 19.5 16.5 14.6 23.4 20.7 18.3 7.7 6.8 6.0

6166-TAI 1.2 1.1 1.0 15.9 10.6 8.9 20.3 13.2 10.6 28.7 17.4 13.9 3.1 2.7 2.4

Sector average 2.2 1.9 1.8 16.8 12.7 11.1 19.9 14.9 12.6 26.1 19.0 16.1 5.4 4.7 4.2

EV/Sales EV/EBITDA EV/EBIT P/E EV/GP




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Exhibit 19: SOTP valuation for SANT (excl. Kontron minorities)

Source: FactSet, equinet Research

Upside case (EUR 22.50): We assume 300 bps faster organic growth in both divisions, IoT and embedded technology, as well as a group EBIT margin 200 bps higher than our base case for 2018ff. This scenario could materialize if SANT`s major ramp-ups occur in coming quarters and years with the Foxconn/Ennoconn partnership and successful commercialization of new designs resulting from this. An acceleration of growth as well as a better than expected execution on further cost reduction and cross-selling effects could help bring EBIT margin up rather sooner than later. An expanded 33x P/E multiple, assumed at the high end of the peer group range shown in Exhibit 16, seems fair to us in this scenario. On P/E, SANT would then trade at a ~25% premium to the sector.

Base case (EUR 21.00): Our base case assumes 15% organic growth in FY18 and 10% organic growth in FY19, as well as a 5.5% group EBIT margin in 2018.

Downside case (EUR 13.00): We assume 300 bps slower organic growth in its main divisions, IoT and embedded technology as well as a group EBIT margin 200 bps lower than our base case for 2018. This scenario could materialize if SANT suffers from contract cancellations and lower purchase volumes on the part of its customers than expected – similar to issues SANT already experienced in 2015/16. Operating cost reduction would automatically become more difficult in this lower growth scenario, so the EBIT margin would be lower. A 19x P/E multiple, well below the FY18 PE multiple for SANT, seems fair to us in this de-rating scenario. On a P/E multiple basis, SANT would then trade at a ~25% discount to the sector.

Exhibit 20: Bull & Bear case with fair value at EUR 21.00


Business unit Method used EV/EBITDA EBITDA 2018 (EUR m) in EUR m in % of total per share in EUR

IT Services Peer multiple based on FY18 11 19 218 18% 3

IoT Peer multiple based on FY18 19 46 849 69% 13

Embedded Solutions Peer multiple based on FY18 (excl. min.) 13 13 164 13% 3

Group 78

Enterprise Value (EV) 1,230 100% 19

Net (debt)/cash incl. pensions Estimate for FY18e 99 2

Equity Value EV plus cash 1,329 21

Number of shares [million] Fully diluted after Nov 2017 cap increase 63

Fair Value 12 Month est.0.00

5.00

10.00

15.00

20.00

25.00

0

500,000

1,000,000

1,500,000

2,000,000

13.11.2016 13.01.2017 13.03.2017 13.05.2017 13.07.2017 13.09.2017 13.11.2017

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- Peer group constituents: IT Services

Asseco Poland (ACP PW): ACP is a Poland-based integrator of information technology (IT) solutions. Its business is divided into three segments, including Finance & Banking; Public Administration and Industry. It offers software and hardware consultancy, production and application of software, data communication infrastructure, administrative services, as well as supply of software and hardware. It provides its solutions for banking sector, as well as for insurance institutions, utilities sector, telecommunication, healthcare, local administration, agriculture and international organizations and institutions. It is operational on such markets as Poland, Balkan, Germany, Slovakia and Israel, among others.

Bechtle (BC8 GY): BC8 is a Germany-based provider of information technology (IT) systems and technology. The Company operates through two segments: IT System House and Managed Services, and IT E-Commerce. The IT System House and Managed Services segment comprises the sale of hardware, software and applications, as well as project planning and roll-out, system integration, maintenance and training, the provision of cloud services and the operation of customer IT. The IT E-Commerce segment focuses on marketing hardware and standard software through the Internet and telesales under the Bechtle direct and ARP brands, as well as providing software asset management services under the Comsoft brand. The Company through subsidiaries operates across Europe and through a network of partners in the Americas, Africa, Asia and Australia.

Cancom (COK GY): COK is a German provider of Information Technology (IT) systems and services. The Company diversifies its activities into two business segments: e-commerce and IT Solutions. The e-commerce business segment comprises CANCOM Deutschland GmbH, CANCOM Computersysteme GmbH, CANCOM a + d IT solutions GmbH, CANCOM (Switzerland) AG and CANCOM Ltd. It mainly comprises the transaction-focused activities of the Company's Group based on online, catalogue, telephone sales and direct sales. The IT Solutions business segment includes CANCOM IT Solutions GmbH, CANCOM NSG GmbH, CANCOM NSG GIS GmbH and acentrix GmbH, among others. It offers IT infrastructure and applications support. The range of services provided by the Company's IT Solutions segment includes IT strategy advice, project planning and implementation, system integration, maintenance, training and other IT services, including operation of entire IT departments. In February 2014, the Company acquired all of shares of HPM Networks.

Datagroup (D6H GY): D6H is a Germany-based information technology (IT) service provider. Its service and product portfolio includes IT Consultation, including IT landscape transformation and IT landscape consulting; System Integration, such as mobile solutions, software development and interactive voice response language portals; Systems, Application and Product (SAP) solutions, including SAP application lifecyle management, SAP business solutions, SAP Hana and SAP landscape transformation, and training and workshops. The Company offers CORBOX, a modul-based solution for IT outsourcing, including data center services, network services, end user services, application management services, SAP services, printing services, communication and collaboration services, big data services, service desk, security services, monitoring services, and continuity services.

- Peer group constituents: Smart Metering

Badger Meter (BMI US): BMI is a manufacturer and marketer of products incorporating flow measurement, control and communication solutions, serving water utilities, municipalities, and commercial and industrial customers around the world. The Company's products measure water, oil, chemicals and other fluids, provide and communicate timely measurement data. Its product lines include two categories: sales of water meters and related technologies to municipal water utilities (municipal water), and sales of meters to various industries for water and other fluids (flow instrumentation). The municipal water offering includes mechanical and ultrasonic (electronic) water meters and related technologies and services used by water utilities as the basis for generating water and

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wastewater. The flow instrumentation category includes the sale of meters and valves around the world to measure and control materials flowing through a pipe or pipeline, including air, steam, oil, and other liquids and gases.

Itron (ITRI US): ITRI is a technology and service company. The Company provides solutions that measure, manage and analyze energy and water use. The Company operates through three segments: Electricity, Gas and Water. It provides a portfolio of products, solutions, software and services to electric, gas and water utility customers across the globe. It offers solutions that enable electric and natural gas utilities to build smart grids to manage assets. It offers a product portfolio, including standard meters and smart metering products, systems and services, for applications in the residential and commercial industrial markets for water and heat. The Company operates under the Itron brand across the world. Its Gas and Water manufacturing facilities are located throughout the world, while its Electricity manufacturing facilities are located in Europe, Middle East and Africa (EMEA), and North America.

Landis+Gyr (LAND SW): LAND provides metering solutions. It offers electricity meters, including commercial and industrial meters, grid meters, residential meters and accessories; communication network and personal energy management products; and grid management solutions for load management, distribution automation and grid analytic applications. The company also provides smart grid solutions for metering, demand response, distribution automation, outage management, prepayment, remote service connection. Landis & Gyr was founded in 1896 and is headquartered in Zug, Switzerland.

Smart Metering Systems (SMS LN): SMS is a United Kingdom-based company, which connects, owns, operates and maintains metering systems. The Company provides an integrated service from beginning to end, from project managing the installation of the gas and/or electricity supply and connection through to the procurement, installation and management of the meter asset, data collection and ongoing energy management services. Its divisions include Asset Management, which consists of regulated management of gas meters, electric meters and ADM units within the United Kingdom; Asset Installation, which consists of installation of domestic and industrial and commercial (I&C) gas meters and electricity meters throughout the United Kingdom, and Energy Management, which consists of the provision of energy advice. The ADM device is SMS's metering solution, which allows for remote meter reading on a half-hourly basis.

- Peer group constituents: Appliance Security

Secunet Security Networks (YSN GY): YSN is a Germany-based provider of information technology (IT) security solutions. The Company develops and IT infrastructure solutions for businesses, authorities and international organizations. It offers solutions in the areas of automotive security, biometrics, cloud security, compliance, cyber security, e-government, electronic billing processes, border control, information security, critical infrastructure, secure inter-network architecture, crypto systems, network security, e-mail, authentication, classified information and public key infrastructure (PKI), among others. The Company has offices in Berlin, Bonn, Borchen, Dresden, Eschborn, Essen, Hamburg, Munich and Siegen in Germany.

Sophos Limited (SOPH LN): SOPH is a United Kingdom-based cyber security company. The Company is engaged in the provision of information technology (IT) security solutions. Its security suites protect organizations by defending against known and unknown malware, spyware, intrusions, unwanted applications, spam, policy abuse and data leakage while providing network access control (NAC). It offers network protection through unified threat management (UTM) and next generation (Next-Gen) firewall, secure Web gateway, secure wireless fidelity (Wi-fi) and secure e-mail gateway; end user protection through end user protection bundles, Sophos cloud, SafeGuard Encryption, endpoint protection and mobile control, and server protection through virtualization security, SharePoint security, PureMessage, server security and network storage antivirus. The Company offers its

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solutions in the United Kingdom, North America and Europe, among others. It also offers around the clock support and upgrades for its products.

- Peer group constituents: Embedded Solutions

Advantech Co. (2395 TT): AVT is a Taiwan-based company principally engaged in the manufacturing, assembling and distribution of industrial computers and related accessories. The Company provides industrial computers, which are applied in the industrial production process; industrial controlling products, which include remote measuring and controlling modules for field signal collection and control; industrial application computers, which include industrial computer platforms such as medical equipment, digital monitoring systems, electronic players, industrial automotive products and network application platforms, among others, as well as embedded cards and computer cases, which are mainly applied in personal computers (PCs). On June 27, 2014, it merged with ISL International Standards Laboratory.

ADLINK TECHNOLOGY (6166 TT): ADL is a Taiwan-based company principally engaged in the provision of measurement and automation products, as well as communication and computer products. The Company’s primary products include high speed data acquisition cards, high speed data recorder systems, industrial control software solutions systems, moving control cards, real-time remote control modules, remote data acquisition modules, machine vision solutions, digital image acquisition cards, embedded control systems, communications cards, embedded computer products, compact personal computer bus (PCI) platforms, advanced telecommunications association (TCA) platforms, industrial single-board computer platforms, embedded module solutions products, as well as modular computer products. The Company mainly operates through four business segments: Asia-Pacific segment, the Mainland China segment, the Americas segment and Europe segment.

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Triggers & Swot Analysis

The first trigger we clearly see for the next twelve month is the successful integration of Kontron and the first positive signs in terms of a turnaround. We feel that SANT is currently in discussion with Foxconn/Ennoconn to exploit further business opportunities and benefit from Foxconn´s vast product pipeline with over 1,000 designs that should help Kontron to fill its product range and massively cross-sell these designs into its existing footprint, where Foxconn lacks distribution power and customer ownership.

The second most important trigger we could anticipate, although for the next years, is a full takeover by Ennoconn, who owns already 22.4% in SANT and is the main shareholder with representatives in the supervisory board. Ennoconn is also familiar with Kontron`s operations and R&D pipeline (having bought Kontron Canada in 2016) and keen to use Kontron´s expertise in industrial, gaming, aviation and automation embedded technology.

In a takeout scenario we would apply similar multiples that were paid in the past for smart metering, security appliances or embedded solutions companies and see a fair M&A multiple at EV/Sales of 2-3x or EV/EBITDA of 14-16x our FY18 estimates.

Exhibit 21: M&A multiples for peer companies


SWOT Analysis

Exhibit 22: Strength & Opportunities outweigh Weakness & Threats


Deal Date Target Buyer Description Deal Size (US$ m) EV/ Revenue EV/ EBITDA

Apr 17 SinnerSchrader AccentureProvider of project management

and consulting services100 2.8x 23.0x

Apr 17 DXC TechnologyComputer

Sciences

Provider of next-generation

information technology services

intended to offer outsourcing and

information technology

transformation services

7,607 1.0x 12.6x

Dec 16 ASG Group

Nomura

Research

Institute

Provider of information technology

services in Australia.256 1.8x 13.0x

Dec 16 StratoUnited

Internet

Provider for the hosting of cloud

computing services.633 4.7x 12.4x

Average 2.6x 15.3x

w /o SinnerSchrader 12.7x

Strenghts Weaknesses

Opportunities Threats

Active in grow th segments such as embedded products

w ith customized solutions on hardw are and softw are side

for automation, industrial, medical and infotainment

segment.

Roll-up model and operational issues of SANT are fully

dependent of current CEO Hannes Niederhauser.

Ow n technology know -how and IP based on standardized

product groups are key elements of SANT´s success and

barriers to entry for competitors.

Revenue stream is highly dependent of project business and

recurring revenue is increasing but still low er w ith risk of

missing on revenue projections going forw ard due to

cancellation or postponement of certain IT projects.

SANT has sales and distribution locations in 25 countries

and is w ell diversif ied w ithin Eastern European countries.

Payments by milestones only especially in the Embedded

Systems segment w ith signif icant investments into design

w ins by SANT.

Embedded Cloud and specialized security solutions for

cloud applications are main requests of SANT´s clients in

the enterprise w orld.

SANT operates in niche markets and regions that are not

attractive for larger players w ith high entry barriers and

long-term customer relationships.

R&D expenses and ow n w ork capitalized might not result in

revenue streams and have to be fully w ritten-off, impacting

SANT´s equity and liquidity positions.

Further penetration into new customer segments w ith its

IT services business and cross-selling potential of IoT and

Embedded solutions.

SANT is located in 25 countries and it is essential to have a

reliable ERP systems tracking inventory, receiveable and

other assets w ithin the group.

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Financials

We expect SANT to grow its group top line by 10% on average over the FY17-21e time span, which is mainly derived from its IoT and Embedded Solutions business. DACH and the Eastern European area should contribute to this development based on further market penetration with newly added product and service offering via cross-selling and distribution efforts of its IoT and Embedded technology products. Additionally, we expect operating results to increase even more on improved cost structures, economies of scale in its embedded and smart metering division, value-added software solutions with higher margins than hardware products and its future synergy potential with Foxconn/Ennoconn with benefits stemming from decreased manufacturing costs (24% EBIT CAGR17-21e vs. 10% Sales CAGR 17-21e).

Segment sales

Regional split: SANT reports revenues in a regional split where DACH generates around 30% and Eastern Europe (EE) 70% of total group revenue. SANT is active in the following regions: Poland, Romania, Bulgaria, Slovakia, Czech Republic, Hungary and with the embedded business of Kontron also in Canada and the US. Poland, Canada and Russia are by far the largest single country contributors with 12%, 15% and 10% of total revenue by 2019 respectively.

Exhibit 23: Growth continues in Eastern Europe and RoW (former Kontron US/Canada)


Volatile project business: The roots of SANT lie in the IT-systems integration world with its own distribution channel for hardware solutions. Management successfully transformed all units, that suffered from one-time and volatile project businesses, into well-established segments with recurring revenues that are based on initial hardware purchases by SANT´s customer but are bundled into three-year maintenance contracts with further cross-selling and margin enhancing potential. However, we feel that SANT is currently well on track to further transform its business and revenue stream towards stable and recurring revenue with higher margin solutions. Embedded solutions and software service for smart grid and electricity should gain ground compared to its more traditional and old-fashioned IT services segment growing modestly with 4-5% p.a. while IoT grows 10-15% and embedded systems 8-10% p.a.

6% 8% 7% 6% 5%9%

14% 9% 10% 11% 12%9%

12%9% 7% 6% 4%6%

8%6% 8% 9% 10%

59%

49%55% 57% 58% 61%

17% 11% 12% 11% 10% 8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014 2015 2016 2017e 2018e 2019e

Germany Poland Romania Russia RoW Austria

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Exhibit 24: IoT and Embedded Solutions taking higher share in revenue


Eastern Europe still growing: Thanks to its transformation, Eastern European markets now account for around 70% of IT services sales in FY17 as the market still grows in that segment (4-5% p.a.) and smart metering solutions. For FY18e, we expect similar growth rates in Eastern Europe of around 4-5%, supported by cross-selling potential of security appliances and smart grid technology. This trend should support its market leader position in Eastern Europe with above 3% market share in IT services.

Positive sales outlook for 2018e and beyond: Management guided for group revenues to surpass EUR 1bn FY18. This translates into a growth rate of around 15% for the group with IoT and Embedded Solutions clearly outpacing group revenue growth. We expect that both segments will contribute significantly to this increase while for IT Services, we have opted for a slower growth rate in-line with local GDP growth of around 4-5%.

Building up product category: We estimate that currently non-recurring revenues (product only sales) stands for about 60% of revenues and recurring with mainly 2-4 year contracts is around 40% for FY17. This ratio should change quickly and revert with upcoming IoT and security applications demanding customized hardware and software solutions to various vertical niche markets.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2014 2015 2016 2017e 2018e 2019e

IT Services IoT Solutions Embedded Systems

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Earnings development

Gross margin: Since taking over the helm at SANT, the current CEO Hannes Niederhauser transformed the old Gericom/Quanmax group via several M&A transaction into a profitable company again. Following the dismal gross margin performance in the past, SANT acquired several software companies such as CBC-X, a pioneer in POS betting terminals, online gambling automation software as well as risk management and monitoring systems for betting shops and bookmakers with a high margin contribution to group earnings. Since 2011 gross margin almost tripled to 33.5% in 2016. We expect a continuation of this trend albeit at a slower pace as shown in Exhibit 25, with gross margin continuously climbing towards 40% by FY21ff. The further up-rise in gross margin stems from the aforementioned focus on customized hardware and software solutions and concentration of high margin products/projects in IoT as well as Embedded Solutions. In our planning period, we assume a cautious step-up of gross margin for SANT by 50-100bps p.a. going forward.

Exhibit 25: GM (lhs), EBITDA and EBIT margin development


EBITDA: The low and declining EBITDA development of the past was mainly attributable to low margin hardware solutions, restructuring expenses as well as limited new product releases with high contribution margins. We see a slight EBITDA margin expansion this year towards 7.2% (FY16: 6.8%). With continued progress in integrating Kontron and first new product releases with the Ennoconn partnership (> 1,000 designs p.a.), we expect an over-proportional increase for the operating results in FY19ff. We forecast the EBITDA margin to rise to 8.5% in FY19e and with continued focus on the cost base and general economies of scale due to manufacturing / outsourcing to Foxconn, an improved EBITDA margin of 9.5% by FY21.

D&A and EBIT: The historically low depreciation should, in our view, continue, as SANT´s business model is not capital intensive and has been in a range of c. 1%-2% of sales in terms of D&A and around 2% in terms of capex. Going forward we assume an almost balanced depreciation/capex level compared to sales. Goodwill amortisation was not an issue in the past but could be an issue with the consolidation of Kontron and the goodwill and intangible level of EUR 97m and EUR 86m respectively. Given the projected stable level of expected depreciation, EBIT growth should outperform EBITDA increases by 500bps as can be seen in the table below.

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

30.0%

32.0%

34.0%

36.0%

38.0%

40.0%

42.0%

2015 2016 2017e 2018e 2019e 2020e 2021e

Gross margin EBITDA margin EBIT margin

S&T AG

Page 20

Exhibit 26: FY17-21e Sales, EBITDA, EBIT and Net Profit CAGR


Financial result: We do not anticipate SANT to earn or pay significant interest in this interest rate environment and do not expect SANT to leverage its business going forward. Relevant for SANT is a good net cash position to convince partners to assign design wins, as SANT as well as Kontron pre-finance any design wins and R&D expenses.

Taxes: As SANT has tax-loss carry-forwards in the amount of EUR 130m, we expect, going forward, a tax rate of 10-15% p.a.

EPS: Based on our assumptions, we expect an EPS of EUR 0.54 in FY17e which is in line with the management forecast. The FY17-21e adjusted EPS CAGR of 28% is significantly higher as 1/we expect the tax rate to remain at low 8-10%-levels in that timespan as mentioned before and 2/as we assume good leverage on the operating side spilling over to bottom line results from FY18 onwards with potential to increase its dividend by 20% p.a. after FY19.

Cash Flow Analysis

Operating CF: With the Kontron acquisition this year and the full consolidation, we expect an increase in net working capital of almost 100% to above EUR 200m compared to last year negatively affecting the cash generation for FY17. OCF should come in around minus EUR 15m and be seen as an outlier due to the aforementioned reason. Management is keen to reverse the balance sheet and working capital deterioration and scale down these positions further to reach a positive OCF by next year. In FY18e, OCF should be again positive at EUR 48m as SANT should benefit from its Ennoconn/Foxconn partnership and outsourcing impact. Going forward we anticipate a 60% OCF/EBITDA conversion rate and develop more in line with the operating result. We forecast a level of 6% of sales to EUR 78m by FY21e, almost doubling from FY18e levels of EUR 48m.

6%

9%

15%

10%12%

18%

24%

28%

0%

5%

10%

15%

20%

25%

30%

S&T AG

Page 21

Exhibit 27: Operating CF to EBITDA conversion ratio


OpFCF and FCF: FCF in the past was volatile, partly due to investments into new ventures and capex. We expect a more balanced development of OpFCF and FCF going forward as we assume no acquisitions or large fluctuations in working capital positions. As stated before, capex should be about EUR 18m to EUR 19m p.a. until FY21e.

Working Capital

Net working capital: As mentioned above, FY17 is distorted by extraordinary effects in working capital due to the Kontron merger. In the following years net working capital should gradually decrease to levels of around 20% in terms of total sales, up from 15%-levels seen in the past. The reason for this increase stems from net working capital requirements of the combined business model to invest into future business with stocking of high rolling standardized embedded hardware products with customized software solutions. Quick and uncomplicated delivery of embedded solutions is essential to win new customers.

Exhibit 28: NWC/sales development


-80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

2017e 2018e 2019e 2020e 2021e

Conversion ratio

00%

05%

10%

15%

20%

25%

2014 2015 2016 2017e 2018e 2019e 2020e 2021e

NWC as a % of sales

S&T AG

Page 22

NWC/sales delta: We see NWC relative to sales delta at 1% or around EUR 10-12m p.a. in our DCF modelling over the FY17-26e planning period.

Equity & Debt

Net Cash: After the successful placement of 5.76m shares at EUR 15.30 per share, SANT received gross proceeds of around EUR 88m. Even with the distortion in net working capital in FY17, SANT is again net cash positive for FY17 and onwards and should hold above EUR 200m in cash by FY19, that is essential for SANT´s embedded business to win new designs and fulfil customer requirements. We view SANT as a growth story and do not anticipate in the near future any meaningful pay-out ratios and expect a ratio of 20% on net earnings going forward.

Exhibit 29: EPS and DPS development


Gearing: As a result of the net cash level, gearing will remain negative and come in at c. 20-30% in our planning period.

ROE

Equity: With the contribution in kind transaction of Kontron into SANT, SANT issued additional 8.6m shares and increased its equity to EUR 182m (57m shares) from EUR 154m before (49m shares) in FY16. SANT again raised cash via a cash-based capital increase in November 2017 with gross proceeds of EUR 88m. Due to the tax effect mentioned before, equity should further increase to levels above EUR 500m by FY21. Beyond FY21 we expect a meaningful pay-out ratio of almost 50% thanks to SANT´s strong balance sheet ratios, generally low capex requirements of its business model and enormous cash on balance of above EUR 200m or 20% of its current market capitalization.

ROE development: In FY16 ROE declined from 17% to 12% due to falling net income and higher equity ratio at that time, coming from the first capital increase of SANT due to the Ennoconn participation deal in FY16. Going forward, we expect ROE to improve relative to our optimistic operating and equity development. For our planning period from FY17-21e our model targets c. 16-23% ROE.

Price/Book: As of end FY17 the book value of SANT should be around EUR 4.60-4.70 per share. Tangible book value per share is forecasted to be around EUR 3.20 with EUR 97m coming from the Kontron acquisition in FY16/17.

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

70%

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

2014 2015 2016 2017e 2018e 2019e 2020e 2021e

EPS (EUR) DPS (EUR) EPS % yoy Payout ratio (%)

S&T AG

Page 23

Exhibit 30: equinet vs. consensus estimates


2017e 2018e 2019e

equinet Cons. Delta equinet Cons. Delta equinet Cons. Delta

Revenues 870.0 868.8 0.1% 1,000.5 970.5 3.1% 1,100.6 1,059.9 3.8%

EBITDA 62.6 61.9 1.3% 78.0 79.5 -1.8% 93.5 94.6 -1.1%

% of sales 7.2% 7.1% 8 BP 7.8% 8.2% -39 BP 8.5% 8.9% -42 BP

EBIT 43.5 36.8 18.1% 55.0 55.6 -1.0% 66.0 70.7 -6.6%

% of sales 5.0% 4.2% 76 BP 5.5% 5.7% -23 BP 6.0% 6.7% -67 BP

Adj. EBIT (PPA) 50.0 39.6 26.4% 60.3 55.4 8.9% 70.3 68.9 2.1%

% of sales 5.7% 4.6% 119 BP 6.0% 5.7% 32 BP 6.4% 6.5% -11 BP

EBT 40.2 31.6 27.4% 52.9 52.8 0.3% 65.0 68.3 -4.7%

Net result 31.3 23.2 35.2% 42.6 43.8 -2.8% 53.0 57.8 -8.3%

% of sales 3.6% 2.7% 93 BP 4.3% 4.5% -92 BP 4.8% 5.5% -186 BP

EPS 0.54 0.46 18.9% 0.67 0.71 -4.9% 0.84 0.93 -10.4%

EPS adj. 0.54 0.46 19.1% 0.67 0.71 -4.9% 0.84 0.93 -10.4%

S&T AG

Page 24

Company Profile & Market Environment

S&T AG provides information technology solutions and services. It operates through the following three segments: IT Services in the DACH and Eastern European market, Internet of Thing Appliances and Embedded Solutions via its latest Kontron acquisition.

Company overview

Company’s history

SANT is an internationally active supplier of IT products and IT system solutions with ca. 3,700 employees which are located in more than 25 countries. Its headquarters are in Linz, Austria. The activities of SANT are primarily concentrated on the DACH and Eastern European markets, where the company is present with its own local branches. SANT´s clients range from SMEs that are active in the widest variety of sectors to leading groups that operate on a world-spanning basis. SANT has been listed in the prime standard of the German Stock Exchange since June 2010 and is a member of the TecDAX since September 2016. The company has existed in its present legal form since 2012, which arose from the merger of S&T System Integration & Technology Distribution AG and Quanmax AG and a subsequent change in the legal form to S&T AG.

History

1990: Founding of S plus S Marketing, Engineering and Computer Production GmbH

1990: Founding of S+S Mobile Computer AG

2000: S plus S becomes GERICOM Mobile Computer GmbH

2000: Merger of GERICOM with S+S Mobile Computer AG and renamed GERICOM AG

11/2000: IPO of GERICOM AG in the regulated market of the Frankfurt Stock Exchange

8/2008: Entry of Quanmax Malaysia Sdn. Bhd. as new major shareholder

9/2008: Renamed Quanmax AG

3/2009: Merger of Chiligreen GmbH with Quanmax AG

4/2009: Merger of European Mobile Computer Service GmbH with Quanmax AG

11/2011: Acquisition of 36% of S&T System Integration & Technology Distribution AG

12/2012: Merger of S&T with QuanmaxAG and renamed S&T AG

The company has some 3,700 staff members working for the Group's subsidiaries and operations,

In 2016, SANT took a stake in Kontron AG, one of the leaders on the world's market for embedded computers and has now completely taken over Kontron except its Canadian business. This transaction enhanced SANT's already large portfolio of proprietary technologies. These are used in the areas of IT appliances, cloud security, software, software, smart energy, and Manufacturing 4.0 and the Internet of Things (IoT) – a sector in which SANT has modest market share currently but is fast growing and outpacing competition in many areas.

S&T AG

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Management

Hannes Niederhauser has been CEO since 2011. From 1999 to 2007 Mr. Niederhauser served as major shareholder and CEO of Kontron AG and was instrumental in this company’s leading market position in the area of embedded computing. Mr. Niederhauser graduated in Electrotechnology from TU Graz, Austria.

Michael Jeske has been COO of S&T AG since mid-2009 and is responsible for the DACH region. Previously Mr. Jeske held the post of VP Operations at Kontron AG and was Head of Operations at Funworld AG. Furthermore, he held various leadership positions in the IT industry in the areas of development, production and quality control.

Richard Neuwirth was appointed CFO of S&T AG in June 2013. He joined the company in 2006 and subsequently held various management positions in the group, such as Managing Director of S&T Bulgaria and Country Manager or Sales Director of S&T Austria. Mr. Neuwirth holds qualifications in law and business and started his career in a legal practice in Vienna.

Dr. Peter Sturz has been COO of S&T AG since 2008 and is responsible for Eastern Europe. He joined the group in 2007 and was initially appointed regional manager for the Adriatic region. Before joining S&T, Dr. Sturz was the member of the management board of the US IT-services provider CSC, responsible for Austria and Eastern Europe. His professional career began in 1983 at the Allgemein Bausparkasse, where he finally served as the management board member responsible for sales, marketing and IT. Dr. Sturz is a qualified lawyer and holds a doctorate from the University of Vienna.

Carlos Queiroz has been active in the embedded industry for over 30 years and started his career as a development engineer. At Kontron he held a variety of management positions and was the Managing Director of the German GmbH organization from 2000 to 2015. In 2015 he joined the S&T Group assuming a Managing Director position before he was appointed to the Management Board.

S&T AG

Page 26

Shareholder structure

The main shareholders of SANT after the Kontron contribution-in-kind merger and the capital increase by SANT in FY16 and FY17 are the Taiwanese Ennoconn Corp., J.P. Morgan Asset Management, Allianz Global Investors, Dorval Asset Management and private investors such as Dr. Erhard Grossnigg (via his family holding grosso Holding), who acts as SANT´s supervisory board chairman and CEO Hannes Niederhauser, who holds around 2% of all outstanding shares. The remainder of the shares are freefloat.

Exhibit 31: Shareholder structure

Source: S&T, equinet Research

Divisional set up

SANT reports revenues within its three segments: IT Services, IoT/Industry 4.0 and Embedded Systems, which contains mainly Kontron´s former businesses. IT Services is split into two regions with Services EE (Eastern Europe) and Services DACH (Germany, Austria, Switzerland). The revenue split for FY17 is as following:

IT Services: EUR 336m, market growing 4-5% p.a.

IoT & Industry 4.0: EUR 341m (including Kontron Europe), market growing 10-15% p.a.

Embedded Systems: EUR 191m (including Kontron US), market growing 8-10% p.a.

22.4%

5.1%

3.8%

3.2%

2.9%

2.0%

60.7%

Ennoconn Corp.

JPMorgan AssetManagement (UK) Ltd.

Allianz Global InvestorsGmbH

Dorval AssetManagement SA

Erhard F. Grossnigg

Hannes Niederhauser(CEO)

Free Float

S&T AG

Page 27

Exhibit 32: Sales split by segment Exhibit 33: Sale split by region

Source: S&T, equinet Research Source: S&T, equinet Research

Geographical split of sales and profit

Germany, Austria and Switzerland account for roughly 30% of revenue within its IT services segment (70% Eastern Europe) and with a stable gross margin of around 25-30% translating into 5% EBITDA margin for SANT. Growth in this segment and region is however limited with a market growth expectation of around 4-5% p.a. SANT already installed a cost efficiency program that targets SANT´s cost structure (EBITDA margin > 5%) and increase its market share above 3% with 50% of recurring years due to enhanced contract duration of two-to-four years.

Rest of Europe is mainly Eastern Europe where SANT tries to leverage its Eastern Europe exposure into the DACH region to win new tenders and enlarge its market share further.

The US segment is addressed via Kontron´s former business and partly outsourced to Ennoconn, which bought Kontron´s Canada business in FY16.

Asia is currently non-existent but could become one of the fastest growing regions for SANT via its partnership with Foxconn/Ennoconn and cooperation plans in mainland China to sell non-volume, customized embedded and IoT products. We feel that SANT will extensively use Foxconn´s R&D capabilities in coming quarters/years and benefit from an enlarged product offering.

15%

49%

27%

9% Services DACH

Services EE

AppliancesSecurity

AppliancesSmart Energy

6% 8% 7% 6% 5%9%

14% 9% 10% 11% 12%9%

12%9% 7% 6% 4%6%

8%6% 8% 9% 10%

59%

49%55% 57% 58% 61%

17% 11% 12% 11% 10% 8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014 2015 2016 2017e 2018e 2019e

Germany Poland Romania Russia RoW Austria

S&T AG

Page 28

Exhibit 34: End user market and products examples


Industry (CAGR 2015-2020) Consumer Business Potential

Automotive EUR 103bn, 12.2% Engine control Unit, Other control units,

Infotainment, Transport Telematics, Security,

Navigation etc.

Fleet Management & Control, Route

optimisation, Fuel consumption.

A typical car now has 65 Microprocessor

control units covering most of its systems

and infotainment. Embedded systems

represent 25%+ of its cost. Electric vehicle

systems,

Avionics & Aerospace EUR 150bn, 12% Infotainment Navigation, Instrumentation, Propulsion,

Scientific, Security, satellite.

Commercial aircraft R & D as well as

subsystem cost is now the significant cost

for security, safety, reliability. The same can

be said for satellite and space exploration.

Flight control represents hundreds of

millions of embedded lines of code on each

craft.

Industrial Automation EUR 207bn, 9.4% Robotics, Process control, Environmental

control

Automation of tasks impossible for humans,

higher quality, consistency & productivity in

Industrial environments. Safety, Security &

Reliability

Healthcare and Medical EUR 75bn, 11.4% Tele-health, Integrated Diagnostic, Imaging,

Health, Health monitoring devices

Diagnostic, Imaging, Therapeutic, Implanted

devices

Technology has enabled significant

advances in genetics, diagnosis and

treatment. Intelligent medical devices are

worn or implanted on patients

Energy EUR 181bn, 34% Energy monitoring and management Smart Grid, Smart metering, Green energy

devices and control

Optimising the supply of cost effective green

energy requires many new intelligent

devices on the networks talking to each

other and automated control systems

coupled with user systems to conserve and

manage their energy usage. Smart meters

and controllers. Vehicle to Grid for EV’s.

Communications EUR 614bn, 13.2% Smart mobile devices. The internet of things

(e.g. white goods connected to apps)

Infrastructure Fixed, Mobile, Satellite.

Machine to machine communications and

intelligence.

Machine to machine communications with

every conceivable consumer and business

device having connectivity to the internet.

Giving us huge amounts of devices and data

which require applications and systems that

allow us access valuable information and

control devices and systems.

Consumer Goods EUR 333bn, 6.3% White goods, Consumer electronics Food production, Food distribution,

Agribusiness

Veterinary tele-health, crop planting and

productivity, satellite data to guide food

production. Connected consumer devices

and infotainment creating autonomous or

remote control. Systems for back office and

consumer settlement relating to

eTransactions e.g. charging an EV, Travel

card etc

Military & Defence EUR 1trn, 5% Security and warning systems Communications, Intelligence, Guidance

and Navigation , etc.

Virtually every device/product for military

application and many technology

innovations were born in military product R &

D.

S&T AG

Page 29

S&T AG : Summary tables

PROFIT & LOSS (EURm) 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Sales 386 468 504 870 1,001 1,101

Cost of Sales & Operating Costs -364 -440 -469 -807 -922 -1,007

Non Recurrent Expenses/Income 1.2 0.0 0.0 0.0 0.0 0.0

EBITDA 22.9 28.4 34.4 62.6 78.0 93.5

EBITDA (adj.)* 21.7 28.3 34.4 62.6 78.0 93.5

Depreciation -7.5 -7.7 -10.3 -12.6 -17.7 -23.2

EBITA 15.4 20.6 24.1 50.0 60.3 70.3

EBITA (adj)* 14.2 20.6 24.1 50.0 60.3 70.3

Amortisations and Write Downs 0.0 0.0 0.0 -6.5 -5.3 -4.3

of which PPA amortisation 0.0 0.0 0.0 -6.5 -5.3 -4.3

EBIT 15.4 20.6 24.1 43.5 55.0 66.0

EBIT (adj.)* 14.2 20.6 24.1 50.0 60.3 70.3

Net Financial Interest -0.3 -2.6 -4.0 -3.3 -2.1 -1.0

Other Financials 0.0 0.0 0.0 0.0 0.0 0.0

Associates 0.0 0.0 0.0 0.0 0.0 0.0

Other Non Recurrent Items 0.0 0.0 0.0 0.0 0.0 0.0

Earnings Before Tax (EBT) 15.1 18.0 20.1 40.2 52.9 65.0

Tax -1.0 -0.3 0.3 -3.0 -4.5 -6.2

Tax rate 6.9% 1.9% n.m. 7.5% 8.5% 9.5%

Discontinued Operations 0.0 0.0 0.0 0.0 0.0 0.0

Minorities -1.0 -1.8 -5.8 -5.8 -5.8 -5.8

Net Profit (reported) 13.0 15.8 14.6 31.3 42.6 53.0

Net Profit (adj.) 12.2 15.8 14.6 31.3 42.6 53.0

CASH FLOW (EURm) 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Cash Flow from Operations before change in NWC 21.9 17.5 132 56.3 71.5 86.4

Change in Net Working Capital -3.7 6.8 -74.5 -71.7 -23.7 -16.0

Cash Flow from Operations 18.2 24.3 57.5 -15.4 47.7 70.4

Capex -5.8 -9.5 -9.3 -18.6 -18.8 -18.8

Net Financial Investments 0.0 0.0 6.0 0.0 0.0 0.0

Free Cash Flow 12.4 14.8 54.1 -34.0 28.9 51.6

Dividends -2.6 -3.1 -3.5 -4.4 -5.3 -5.6

Other (incl. Capital Increase & share buy backs) 0.0 0.0 0.0 0.0 0.0 0.0

Change in Net Debt 9.8 11.7 50.6 -38.4 23.7 46.0

NOPLAT 9.9 14.4 16.9 35.0 42.2 49.2

BALANCE SHEET & OTHER ITEMS (EURm) 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Net Tangible Assets 11.4 15.2 27.5 27.2 24.7 19.5

Net Intangible Assets (incl.Goodwill) 57.1 72.8 183 183 181 178

Net Financial Assets & Other 3.8 3.1 12.1 12.1 12.1 12.1

Total Fixed Assets 72.3 91.0 223 222 218 209

Inventories 30.4 28.8 85.4 137 153 165

Trade receivables 95.7 86.4 169 270 303 326

Other current assets 34.8 51.7 62.8 62.8 62.8 62.8

Cash (-) -39.9 -61.2 -129 -177 -198 -241

Total Current Assets 201 228 446 646 717 795

Total Assets 273 319 669 868 935 1,004

Shareholders Equity 86.9 99.8 154 267 302 347

Minority 2.8 2.4 87.0 92.9 98.7 105

Total Equity 89.7 102 241 360 401 451

Long term interest bearing debt 31.0 40.0 85.2 84.2 83.2 82.2

Provisions 2.3 2.5 11.6 11.6 11.6 11.6

Other long term liabilities 15.5 21.2 47.9 47.9 47.9 47.9

Total Long Term Liabilities 48.8 63.6 145 144 143 142

Short term interest bearing debt 10.0 11.0 12.0 13.0 14.0 15.0

Trade payables 74.2 70.1 134 215 241 259

Other current liabilities 50.4 72.2 137 137 137 137

Total Current Liabilities 135 153 283 365 392 411

Total Liabilities and Shareholders' Equity 273 319 669 868 935 1,004

Net Capital Employed 109 116 269 340 359 367

Net Working Capital 51.9 45.1 120 191 215 231

GROWTH & MARGINS 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Sales growth 14.1% 21.4% 7.6% 72.7% 15.0% 10.0%

EBITDA (adj.)* growth 62.3% 30.7% 21.3% 82.3% 24.6% 19.9%

EBITA (adj.)* growth -0.7% 45.1% 17.0% 107.5% 20.7% 16.6%

EBIT (adj)*growth -0.7% 45.1% 17.0% 107.5% 20.7% 16.6%

S&T AG

Page 30

S&T AG : Summary tables

GROWTH & MARGINS 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Net Profit growth 3.5% 30.2% -7.9% 115.1% 36.0% 24.5%

EPS adj. growth -1.0% 22.7% -8.9% 64.3% 23.6% 24.5%

DPS adj. growth n.m. 9.9% 13.0% -4.5% 9.1% 5.6%

EBITDA (adj)* margin 5.6% 6.1% 6.8% 7.2% 7.8% 8.5%

EBITA (adj)* margin 3.7% 4.4% 4.8% 5.7% 6.0% 6.4%

EBIT (adj)* margin 3.7% 4.4% 4.8% 5.7% 6.0% 6.4%

RATIOS 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Net Debt/Equity 0.0 -0.1 -0.1 -0.2 -0.3 -0.3

Net Debt/EBITDA 0.0 -0.4 -0.9 -1.3 -1.3 -1.5

Interest cover (EBITDA/Fin.interest) 66.3 10.8 8.5 18.9 37.4 94.4

Capex/D&A 77.3% 122.6% 90.5% 97.2% 81.7% 68.3%

Capex/Sales 1.5% 2.0% 1.8% 2.1% 1.9% 1.7%

NWC/Sales 13.5% 9.6% 23.8% 22.0% 21.5% 21.0%

ROE (average) 15.6% 16.9% 11.5% 14.9% 15.0% 16.3%

ROCE (adj.) 8.3% 10.8% 5.1% 8.7% 10.0% 11.5%

WACC 7.9% 7.9% 7.9% 7.9% 7.9% 7.9%

ROCE (adj.)/WACC 1.0 1.4 0.6 1.1 1.3 1.5

PER SHARE DATA (EUR)*** 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Average diluted number of shares 41.0 43.5 44.0 57.6 63.4 63.4

EPS (reported) 0.32 0.36 0.33 0.54 0.67 0.84

EPS (adj.) 0.30 0.36 0.33 0.54 0.67 0.84

BVPS 2.12 2.29 3.50 4.63 4.76 5.47

DPS 0.06 0.07 0.08 0.08 0.08 0.09

VALUATION 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

EV/Sales 0.4 0.5 0.9 1.2 1.1 1.0

EV/EBITDA 5.9 8.9 12.8 16.4 14.2 11.5

EV/EBITDA (adj.)* 6.3 8.9 12.8 16.4 14.2 11.5

EV/EBITA 8.8 12.2 18.2 20.5 18.4 15.3

EV/EBITA (adj.)* 9.6 12.2 18.2 20.5 18.4 15.3

EV/EBIT 8.8 12.2 18.2 23.6 20.2 16.2

EV/EBIT (adj.)* 9.6 12.2 18.2 20.5 18.4 15.3

P/E (adj.) 10.9 16.4 26.3 32.2 26.1 20.9

P/BV 1.5 2.6 2.5 3.8 3.7 3.2

Total Yield Ratio 2.3% 1.4% 0.6% 0.5% 0.5% 0.6%

EV/CE 1.1 1.9 1.3 2.6 2.6 2.5

OpFCF yield 9.4% 5.7% 12.6% -3.4% 2.6% 4.6%

OpFCF/EV 9.2% 5.9% 11.0% -3.3% 2.6% 4.8%

Payout ratio 20.3% 19.5% 24.1% 14.0% 12.4% 10.5%

Dividend yield (gross) 2.0% 1.2% 0.5% 0.4% 0.5% 0.5%

EV AND MKT CAP (EURm) 12/2014 12/2015 12/2016 12/2017e 12/2018e 12/2019e

Price** (EUR) 3.22 5.95 8.70 17.53 17.53 17.53

Outstanding number of shares for main stock 41.0 43.5 44.0 57.6 63.4 63.4

Total Market Cap 132 259 383 1,009 1,111 1,111

Net Debt 1 -10 -32 -79 -101 -144

o/w Cash & Marketable Securities (-) -40 -61 -129 -177 -198 -241

o/w Gross Debt (+) 41 51 97 97 97 97

Other EV components 3 2 89 95 101 106

Enterprise Value (EV adj.) 136 251 440 1,025 1,110 1,073

Source: Company, equinet Bank estimates.

Notes* Where EBITDA (adj.) or EBITA (adj)= EBITDA (or EBITA) -/+ Non Recurrent Expenses/Income and where EBIT (adj)= EBIT-/+ Non Recurrent Expenses/Income - PPA amortisation

**Price (in local currency): Fiscal year end price for Historical Years and Current Price for current and forecasted years

Sector: Technology Hardware & Equipment/Technology Hardware & Equipment

Company Description: S&T AG provides information technology solutions and services. It operates through the following three

segments: IT Services in the DACH and Eastern European area, Internet of Thing Appliances and Embedded Solutions via its latest

Kontron acquisition.

S&T AG

Page 31

European Coverage of the Members of ESN

A ero space & D efense M em(*) Bankinter GVC Kws Saat EQB Campari BAK

Airbus Se CIC Bbva GVC Linde EQB Coca Cola Hbc Ag IBG

Dassault Aviation CIC Bcp CBI Siegfried Holding Ag EQB Corbion NIBC

Latecoere CIC Bnp Paribas CIC Symrise Ag EQB Danone CIC

Leonardo BAK Bper BAK Tikkurila OPG Ebro Foods GVC

Lisi CIC Bpi CBIElectro nic & Electrical

EquipmentM em(*) Enervit BAK

M tu Aero Engines EQB Caixabank GVC Areva CIC Fleury M ichon CIC

Ohb Se EQB Commerzbank EQB Euromicron Ag EQB Forfarmers NIBC

Safran CIC Credem BAK Legrand CIC Heineken NIBC

Thales CIC Credit Agrico le Sa CIC Neways Electronics NIBC Hkscan OPG

Zodiac Aerospace CIC Creval BAK Nexans CIC La Doria BAK

A lternat ive Energy M em(*) Deutsche Bank EQB Pkc Group OPG Lanson-Bcc CIC

Daldrup & Soehne EQB Deutsche Pfandbriefbank EQB Rexel CIC Laurent Perrier CIC

Gamesa GVC Eurobank IBG Schneider Electric Se CIC Ldc CIC

Sif Group NIBC Intesa Sanpaolo BAK Vaisala OPG Lucas Bols NIBC

Solaria GVC M ediobanca BAK Viscom EQB Naturex CIC

A uto mo biles & P arts M em(*) M erkur Bank EQB F inancial Services M em(*) Olvi OPG

Bittium Corporation OPG National Bank Of Greece IBG Anima BAK Pernod Ricard CIC

Bmw EQB Natixis CIC Athex Group IBG Raisio OPG

Brembo BAK Nordea OPG Azimut BAK Refresco Group NIBC

Continental EQB Piraeus Bank IBG Banca Generali BAK Remy Cointreau CIC

Daimler Ag EQB Poste Italiane BAK Banca Ifis BAK Suedzucker EQB

Elringklinger EQB Procredit Holding EQB Banca Sistema BAK Vidrala GVC

Faurecia CIC Rothschild & Co CIC Bb Biotech EQB Vilmorin CIC

Ferrari BAK Societe Generale CIC Bolsas Y M ercados Espanoles Sa GVC Viscofan GVC

Fiat Chrysler Automobiles BAK Ubi Banca BAK Capman OPG Vranken Pommery M onopole CIC

Groupe Psa CIC Unicredit BAK Christian Dior CIC Wessanen NIBC

Landi Renzo BAK B asic R eso urces M em(*) Cir BAK F o o d & D rug R etailers M em(*)

Leoni EQB Acerinox GVC Comdirect EQB Aholddelhaize NIBC

M ichelin CIC Altri CBI Corestate Capital Holding S.A. EQB Carrefour CIC

Nokian Tyres OPG Arcelormittal GVC Corp. Financiera Alba GVC Casino Guichard-Perrachon CIC

Norma Group EQB Corticeira Amorim CBI Deutsche Forfait EQB Dia GVC

Piaggio BAK Ence GVC Eq OPG Jeronimo M artins CBI

Plastic Omnium CIC Europac GVC Euronext CIC Kesko OPG

Pwo EQB M etka IBG Ferratum EQB M arr BAK

Sogefi BAK M etsä Board OPG Ffp CIC M etro EQB

Stabilus EQB M ytilineos IBG Finecobank BAK Sligro NIBC

Stern Groep NIBC Outokumpu OPG Grenke EQB Sonae CBI

Valeo CIC Semapa CBI Hypoport Ag EQB

Volkswagen EQB Ssab OPG M lp EQB

B anks M em(*) Stora Enso OPG Ovb Holding Ag EQB

Aareal Bank EQB Surteco EQB Patrizia EQB

Aktia OPG The Navigator Company CBI Rallye CIC

Alpha Bank IBG Tubacex GVC Tip Tamburi Investment Partners BAK

Banca Carige BAK Upm-Kymmene OPG Unipol Gruppo Finanziario BAK

Banca M ps BAK C hemicals M em(*) Wendel CIC

Banco Popular GVC Air Liquide CIC F o o d & B everage M em(*)

Banco Sabadell GVC Fuchs Petro lub EQB Acomo NIBC

Banco Santander GVC Holland Colours NIBC Atria OPG

Bankia GVC Kemira OPG Bonduelle CIC

S&T AG

Page 32

General Industria ls M em(*) Fila BAK Sampo OPG Brill NIBC

2G Energy EQB Philips Lighting NIBC Talanx Group EQB Cairo Communication BAK

Aalberts NIBC Seb Sa CIC Unipolsai BAK Cofina CBI

Accell Group NIBC Industria l Engineering M em(*)M aterials, C o nstruct io n &

InfrastructureM em(*) Cts Eventim EQB

Ahlstrom OPG Accsys Technologies NIBC Abertis GVC Digital Bros BAK

Arcadis NIBC Aixtron EQB Acs GVC Editoriale L'Espresso BAK

Aspo OPG Alstom CIC Aena GVC Gl Events CIC

Huhtamäki OPG Ansaldo Sts BAK Aeroports De Paris CIC Havas CIC

Kendrion NIBC Biesse BAK Astaldi BAK Impresa CBI

Nedap NIBC Cargotec Corp OPG Atlantia BAK Io l BAK

Pöyry OPG Cnh Industrial BAK Boskalis Westminster NIBC Ipsos CIC

Prelios BAK Danieli BAK Buzzi Unicem BAK Jcdecaux CIC

Saf-Holland EQB Datalogic BAK Caverion OPG Lagardere CIC

Serge Ferrari Group CIC Deutz Ag EQB Cramo OPG M 6-M etropole Television CIC

Tkh Group NIBC Duro Felguera GVC Eiffage CIC M ediaset BAK

General R etailers M em(*) Emak BAK Ellaktor IBG M ediaset Espana GVC

Beter Bed Holding NIBC Exel Composites OPG Eltel OPG Notorious Pictures BAK

Elumeo Se EQB Fincantieri BAK Ezentis GVC Nrj Group CIC

Fielmann EQB Gesco EQB Fcc GVC Publicis CIC

Folli Fo llie Group IBG Ima BAK Ferrovial GVC Rcs M ediagroup BAK

Fourlis Holdings IBG Interpump BAK Heidelberg Cement Ag CIC Relx NIBC

Groupe Darty CIC Kone OPG Heijmans NIBC Rtl Group EQB

Hornbach Holding EQB Konecranes OPG Imerys CIC Sanoma OPG

Inditex GVC M anz Ag EQB Lafargeholcim CIC Solocal Group CIC

Jumbo IBG M ax Automation Ag EQB Lehto OPG Spir Communication CIC

Rapala OPG M etso Corporation OPG Lemminkäinen OPG Syzygy Ag EQB

Stockmann OPG Outotec OPG M aire Tecnimont BAK Telegraaf M edia Groep NIBC

Tokmanni OPG Pfeiffer Vacuum EQB M ota Engil CBI Tf1 CIC

Windeln.De EQB Ponsse OPG Obrascon Huarte Lain GVC Ubisoft CIC

Yoox Net-A-Porter BAK Prima Industrie BAK Ramirent OPG Vivendi CIC

H ealthcare M em(*) Prysmian BAK Royal Bam Group NIBC Wolters Kluwer NIBC

4Sc EQB Smt Scharf Ag EQB Sacyr GVC Oil & Gas P ro ducers M em(*)

Amplifon BAK Technotrans EQB Saint Gobain CIC Eni BAK

Bayer EQB Valmet OPG Salini Impregilo BAK Galp Energia CBI

Biotest EQB Wärtsilä OPG Sias BAK Gas Plus BAK

Diasorin BAK Zardoya Otis GVC Srv OPG Hellenic Petro leum IBG

Epigenomics Ag EQB Industria l T ranspo rtat io n M em(*) Tarkett CIC M aurel Et Prom CIC

Genfit CIC Bollore CIC Thermador Groupe CIC M otor Oil IBG

Guerbet CIC Caf GVC Titan Cement IBG Neste Corporation OPG

Korian CIC Ctt CBI Trevi BAK Petrobras CBI

M erck EQB Logwin EQB Uponor OPG Qgep CBI

Orio la-Kd OPG Insurance M em(*) Vicat CIC Repsol GVC

Orion OPG Allianz EQB Vinci CIC Total CIC

Orpea CIC Axa CIC Yit OPG

Pihlajalinna OPG Banca M edio lanum BAK M edia M em(*)

Recordati BAK Catto lica Assicurazioni BAK Ad Pepper EQB

Wilex EQB Generali BAK Alma M edia OPG

H o useho ld Go o ds M em(*) Hannover Re EQB Atresmedia GVC

Bic CIC M apfre Sa GVC Axel Springer EQB

De Longhi BAK M unich Re EQB Axelero BAK

S&T AG

Page 33

Oil Services M em(*) Wcm Ag EQB Lassila & Tikanoja OPG Int. A irlines Group GVC

Bourbon CIC So ftware & C o mputer Services M em(*) Openjobmetis BAK Intralo t IBG

Cgg CIC Affecto OPG Teleperformance CIC Kotipizza OPG

Fugro NIBC Akka Technologies CICT echno lo gy H ardware &

EquipmentM em(*) M elia Hotels International GVC

Rubis CIC Alten CIC Asm International NIBC Nh Hotel Group GVC

Saipem BAK Altran CIC Asml NIBC Opap IBG

Sbm Offshore NIBC Assystem CIC Besi NIBC Snowworld NIBC

Technipfmc Plc CIC Atos CIC Ericsson OPG Sodexo CIC

Tecnicas Reunidas GVC Basware OPG Gigaset EQB Sonae Capital CBI

Tenaris BAK Cenit EQB Ingenico CIC Trigano CIC

Vallourec CIC Comptel OPG Kontron EQB Utilit ies M em(*)

Vopak NIBC Ctac NIBC Nokia OPG A2A BAK

P erso nal Go o ds M em(*) Digia Plc OPG Roodmicrotec NIBC Acciona GVC

Adidas EQB Docdata NIBC Slm Solutions EQB Acea BAK

Adler M odemaerkte EQB Econocom CIC Stmicroelectronics BAK Albioma CIC

Amer Sports OPG Ekinops CIC Suess M icrotec EQB Direct Energie CIC

Basic Net BAK Esi Group CIC Teleste OPG Edp CBI

Cie Fin. Richemont CIC Exprivia BAK Va-Q-Tec EQB Edp Renováveis CBI

Geox BAK F-Secure OPG T eleco mmunicat io ns M em(*) Enagas GVC

Gerry Weber EQB Gemalto CIC Acotel BAK Endesa GVC

Hermes Intl. CIC Gft Technologies EQB Bouygues CIC Enel BAK

Hugo Boss EQB Ict Group NIBC Deutsche Telekom EQB Erg BAK

Interparfums CIC Indra Sistemas GVC Dna OPG Eydap IBG

Kering CIC Nemetschek Se EQB Drillisch EQB Falck Renewables BAK

L'Oreal CIC Neurones CIC Elisa OPG Fortum OPG

Luxottica BAK Nexus Ag EQB Euskaltel GVC Gas Natural Fenosa GVC

Lvmh CIC Novabase CBI Freenet EQB Hera BAK

M arimekko OPG Ordina NIBC Kpn Telecom NIBC Iberdro la GVC

M oncler BAK Psi EQB M asmovil GVC Iren BAK

Puma EQB Reply BAK Nos CBI Italgas BAK

Safilo BAK Rib Software EQB Oi CBI Public Power Corp IBG

Salvatore Ferragamo BAK Seven Principles Ag EQB Orange CIC Red Electrica De Espana GVC

Sarantis IBG Software Ag EQB Ote IBG Ren CBI

Technogym BAK Sopra Steria Group CIC Tele Columbus EQB Snam BAK

Tod'S BAK Tie Kinetix NIBC Telecom Italia BAK Terna BAK

R eal Estate M em(*) Tieto OPG Telefonica GVC

Adler Real Estate EQB Tomtom NIBC Telefonica Deutschland EQB

Beni Stabili BAK United Internet EQB Telia OPG

Citycon OPG Visiativ CIC Tiscali BAK

Demire EQB Wincor Nixdorf EQB Vodafone BAK

Deutsche Euroshop EQB Suppo rt Services M em(*) T ravel & Leisure M em(*)

Grand City Properties EQB Amadeus GVC Accor CIC

Hispania Activos Inmobiliarios GVC Asiakastieto Group OPG Air France Klm CIC

Igd BAK Batenburg NIBC Autogrill BAK

Lar España GVC Cellnex Telecom GVC Beneteau CIC

M erlin Properties GVC Dpa NIBC Elior CIC

Realia GVC Edenred CIC Europcar CIC

Sponda OPG Ei Towers BAK Finnair OPG

Technopolis OPG Enav BAK I Grandi Viaggi BAK

Vib Vermoegen EQB Fiera M ilano BAK Iberso l CBI

LEGEND: BAK: Banca Akros; CIC: CM CIC Market Solutions; CBI: Caixa-Banco de Investimento; GVC: GVC Gaesco Beksa, SV, SA; EQB: Equinet bank; IBG: Investment Bank of Greece,

NIBC: NIBC Markets N.V: OPG: OP Corporate Bank:;as of 1st June 2017

S&T AG

Page 34

List of ESN Analysts (**)

Artur Amaro CBI +351 213 89 6822 [email protected] Konstantinos Manolopoulos IBG +30 210 817 3388 [email protected]

Helena Barbosa CBI +351 21 389 6831 [email protected] Katharina Mayer EQB +49 69 58997-432 [email protected]

Winfried Becker EQB +49 69 58997-416 [email protected] Fanny Meindre, PhD CIC +33 1 53 48 80 84 [email protected]

Jav ier Bernat GVC +34 91 436 7816 jav [email protected] Dario Michi BAK +39 02 4344 4237 [email protected]

Dimitris Birbos IBG +30 210 81 73 392 [email protected] Marietta Miemietz CFA EQB +49-69-58997-439 [email protected]

Agnès Blazy CIC +33 1 53 48 80 67 [email protected] José Mota Freitas, CFA CBI +351 22 607 09 31 [email protected]

Charles Edouard Boissy CIC +33 01 53 48 80 81 [email protected] Henri Parkkinen OPG +358 10 252 4409 [email protected]

Rafael Bonardell GVC +34 91 436 78 71 [email protected] Victor Peiro Pérez GVC +34 91 436 7812 [email protected]

Louise Boyer CIC +33 1 53 48 80 68 [email protected] Francis Prêtre CIC +33 4 78 92 02 30 [email protected]

Christian Bruns EQB +49 69 58997 415 [email protected] Francesco Previtera BAK +39 02 4344 4033 francesco.prev [email protected]

Giada Cabrino, CIIA BAK +39 02 4344 4092 [email protected] Jari Raisanen OPG +358 10 252 4504 [email protected]

Arnaud Cadart CIC +33 1 53 48 80 86 [email protected] Hannu Rauhala OPG +358 10 252 4392 [email protected]

Niclas Catani OPG +358 10 252 8780 [email protected] Matias Rautionmaa OPG +358 10 252 4408 [email protected]

Pierre Chedeville CIC +33 1 53 48 80 97 [email protected] Eric Ravary CIC +33 1 53 48 80 71 [email protected]

Emmanuel Chevalier CIC +33 1 53 48 80 72 [email protected] Iñigo Recio Pascual GVC +34 91 436 7814 [email protected]

David Consalvo CIC +33 1 53 48 80 64 [email protected] André Rodrigues CBI +351 21 389 68 39 [email protected]

Edwin de Jong NIBC +312 0 5508569 [email protected] John David Roeg NIBC +31 (0)20 550 86 46 [email protected]

Martijn den Drijver NIBC +312 0 5508636 [email protected] Jean-Luc Romain CIC +33 1 53 48 80 66 [email protected]

Christian Devismes CIC +33 1 53 48 80 85 [email protected] Vassilis Roumantzis IBG +30 2108173394 [email protected]

Andrea Devita, CFA BAK +39 02 4344 4031 [email protected] Sonia Ruiz De Garibay GVC +34 91 436 7841 [email protected]

Sebastian Droste EQB +49 69 58 99 74 34 [email protected] Zafer Rüzgar EQB +49 69 58 99 74 12 [email protected]

Enrico Esposti, CIIA BAK +39 02 4344 4022 [email protected] Antti Saari OPG +358 10 252 4359 [email protected]

Rafael Fernández de Heredia GVC +34 91 436 78 08 [email protected] Paola Saglietti BAK +39 02 4344 4287 [email protected]

Enrico Filippi, CEFA BAK +39 02 4344 4071 [email protected] Francesco Sala BAK +39 02 4344 4240 [email protected]

Gabriele Gambarova BAK +39 02 43 444 289 [email protected] Tim Schuldt, CFA EQB +49 69 5899 7433 [email protected]

Eduardo Garcia Arguelles GVC +34 914 367 810 [email protected] Cengiz Sen EQB +4969 58997 435 [email protected]

Alexandre Gérard CIC +33 1 53 48 80 93 [email protected] Pekka Spolander OPG +358 10 252 4351 [email protected]

Philipp Häßler, CFA EQB +49 69 58997 414 [email protected] Kimmo Stenvall OPG +358 10 252 4561 [email protected]

Simon Heilmann EQB +49 69 58 997 413 [email protected] Natalia Svyrou-Svyriadi IBG +30 210 81 73 384 [email protected]

Dr. Knud Hinkel, CFA EQB + 49 69 58997 419 [email protected] Manuel Tanzer EQB +49 69 58997-418 [email protected]

Carlos Jesus CBI +351 21 389 6812 [email protected] Luigi Tramontana BAK +39 02 4344 4239 [email protected]

Mark Josefson EQB +4969-58997-437 [email protected] Johan van den Hooven NIBC +312 0 5508518 [email protected]

Thomas Landemaine, PhD CIC +33 1 53 48 80 26 [email protected] Dylan van Haaften NIBC +312 0 611915485 [email protected]

Jean-Christophe Lefèvre-Moulenq CIC +33 1 53 48 80 65 [email protected] Kévin Woringer CIC +33 1 53 48 80 69 [email protected]

(**) excluding: strategists, macroeconomists, heads of research not covering specific stocks, credit analysts, technical analysts

S&T AG

Page 35

Recommendations and Disclosures

Coverage Analyst Target Rating Disc. Coverage Analyst Target Rating Disc.2G Energy Rüzgar 22.50 Neut ral 2/ 3/ 5 Norma Group Schuldt 61.00 Neut ral

4SC Miemiet z 3.50 Buy 7 OHB SE Rüzgar 40.00 Neut ral 7

Aareal Bank Häßler 38.00 Accumulat e OVB Holding AG Häßler 20.00 Accumulat e 2/ 5/ 7

adidas Josef son 211.00 Accumulat e Pat r izia Mayer 21.50 Accumulat e

Adler Modemaerkt e Josef son 7.50 Buy 7 Pf eif f er Vacuum Sen 162.00 Accumulat e 5

ADLER Real Est at e Mayer 15.20 Accumulat e Procredit Holding Häßler 15.60 Buy 2

Aixt ron Sen 11.60 Accumulat e 2/ 3 PSI SOFTWARE AG Drost e 20.00 Accumulat e 2/ 3

Allianz Häßler 200.00 Neut ral Puma Josef son 430.00 Accumulat e

Axel Springer Josef son 51.00 Neut ral PWO Schuldt 57.00 Buy 2/ 3

Bayer Miemiet z 118.00 Buy Rheinmet all Rüzgar 110.00 Accumulat e

BB Biot ech Miemiet z 60.00 Buy 7 RIB Sof t ware Drost e 16.50 Buy 2/ 3

Biot est Miemiet z 18.00 Neut ral 2/ 3 RTL Group Josef son 72.00 Accumulat e

BMW Schuldt 98.00 Accumulat e S&T AG Sen 21.00 Buy 2/ 3

Brennt ag Hinkel 53.00 Buy 2 SAF-Holland Schuldt 17.00 Accumulat e 7

Ceconomy AG Bruns 9.00 Reduce Siegf r ied Holding AG Miemiet z 295.00 Accumulat e

Cenit Drost e 22.50 Buy SLM Solut ions Sen 27.50 Reduce

comdirect Häßler 10.60 Neut ral SMT Scharf AG Rüzgar 15.00 Accumulat e 2/ 3

Commerzbank Häßler 11.50 Neut ral Sof t ware AG Drost e 30.00 Sell

Cont inent al Schuldt 270.00 Buy St abilus Tanzer 85.00 Accumulat e

CORESTATE Capit al Holding S.A. Mayer 69.00 Buy 2/ 5 Suedzucker Bruns 15.50 Reduce

CTS Event im Heilmann 40.00 Buy Suess MicroTec Sen 14.30 Reduce 2/ 3

Daimler AG Schuldt 76.00 Buy Surt eco Mildner 30.00 Buy 2/ 3

Daldrup & Soehne Becker 10.10 Buy 2/ 3/ 5 Symrise AG Hinkel 67.00 Neut ral

Demire Mayer 4.30 Accumulat e 2/ 5 Syzygy AG Heilmann 12.00 Accumulat e 2/ 3

Deut sche Bank Häßler 17.50 Buy TAKKT AG Bruns 18.70 Neut ral 2

Deut sche EuroShop Mayer 33.00 Neut ral Talanx Group Häßler 38.00 Accumulat e

Deut sche Pf andbrief bank Häßler 12.00 Neut ral Technot rans Becker 45.70 Neut ral 2/ 3

Deut sche Telekom Sen 15.50 Neut ral TELE COLUMBUS Sen 11.00 Buy

Drillisch Sen 66.00 Buy Telef onica Deut schland Sen 3.70 Sell

Elr ingKlinger Schuldt 12.40 Reduce Unit ed Int ernet Sen 63.00 Buy

elumeo SE Josef son 9.60 Buy Vapiano Bruns 26.50 Buy 2/ 7

Epigenomics AG Miemiet z 4.72 Accumulat e 2/ 3 va-Q-t ec Sen 17.00 Neut ral 2/ 3/ 5

Euromicron AG Drost e 13.00 Buy 2/ 3/ 5 Viscom Rüzgar 29.50 Accumulat e 2/ 3

Ferrat um Häßler 28.00 Buy Volkswagen Schuldt 166.00 Buy

Fielmann Heilmann 81.00 Accumulat e Wacker Neuson SE Becker 27.20 Neut ral

Freenet Sen 36.00 Buy 2 WCM AG Mayer 3.25 Neut ral 2/ 3

Fuchs Pet rolub Hinkel 47.00 Neut ral windeln.de Josef son 4.60 Buy 2

Gerry Weber Josef son 8.50 Neut ral XING AG Heilmann 315.00 Buy

Gesco Becker 35.20 Accumulat e 2/ 3/ 5 Zalando Josef son 44.50 Accumulat e

GFT Technologies Drost e 15.00 Buy 2/ 3

Gigaset Sen 0.85 Accumulat e 2/ 3

Grenke Häßler 83.00 Neut ral

Hannover Re Häßler 110.00 Neut ral

Heidelberg Pharma Miemiet z 3.50 Buy 2/ 3

Heidelberger Druck August in 3.70 Buy

HELLA GmbH & Co. KGaA Tanzer 55.00 Accumulat e

Hornbach Holding Bruns 89.00 Buy

Hugo Boss Josef son 80.00 Buy

Hypoport AG Häßler 164.00 Buy 7

INDUS Holding AG Becker 64.50 Neut ral

K+S AG Hinkel 24.40 Accumulat e

KWS SAAT Hinkel 348.00 Neut ral

Leoni Schuldt 57.00 Neut ral

Linde Hinkel 175.00 Neut ral

Logwin Mildner 148.00 Neut ral 2/ 3/ 5

Manz AG Rüzgar 37.00 Neut ral 2/ 3

MAX Aut omat ion AG Becker 9.20 Buy 2/ 3/ 5

Merck Miemiet z 112.00 Buy

Merkur Bank Häßler 9.30 Buy 2/ 7

Met ro AG Bruns 29.00 Buy 2

MLP Häßler 7.50 Buy 2/ 3

MTU Aero Engines Rüzgar 142.00 Neut ral 2

Munich Re Häßler 210.00 Accumulat e

Nemet schek SE Drost e 47.00 Reduce 5

Nexus AG Drost e 28.00 Buy

S&T AG

Page 36

Notice according to § 34 b (German) Securities Trading Act (“Wertpapierhandelsgesetz”) This document is issued by Equinet Bank AG (“Equinet Bank”). It has been prepared by its authors independently of the Company, and none of Equinet Bank, the Company or its shareholders has independently verified any of the information given in this document. Equinet Bank possesses relations to the covered companies as detailed in the table on the previous page. Additional information and disclosures will be made available upon request and/or can be looked up on our website http://www.Equinet Bank-ag.de 1 - Equinet Bank and/or its affiliate(s) hold(s) more than 5% of the share capital of this company calculated under computational methods required by German law. 2 - Equinet Bank acts as a designated sponsor for this company, including the provision of bid and ask offers. Therefore, we regularly possess shares of the company in our proprietary trading books. Equinet Bank receives a commission from the company for the provision of the designated sponsor services. 3 – The designated sponsor services include a contractually agreed provision of research services. 4 – Within the last twelve months, Equinet Bank was involved as a lead or co-lead manager in the public offering of securities which are/whose issuer is the subject of this report. 5 – Within the last twelve months, Equinet Bank and/or its affiliate(s) provided investment banking- and/or other consultancy services for this company and/or it’s shareholders. 6 - Equinet Bank and/or its affiliate(s) has/have other substantial financial interests in relation to this issuer. 7 – Equinet Bank has entered into an agreement with this company about the preparation of research reports and – in return - receives a compensation. Companies of the Equinet Bank group and/or its directors, officers and employees or clients may take positions in, and may make purchases and/or sales as principal or agent in the securities or related financial instruments discussed in our reports. The Equinet Bank group may provide investment banking and other services to and/or serve as directors of the companies referred to in our reports. In compliance with Para 5 Sec. 4 of the Ordinance on the Analysis of Financial Instruments (FinAnV) Equinet Bank has realized additional internal and organizational measures, such as specific research guidelines, to prevent or manage conflicts of interest. Neither the company nor its employees are allowed to receive donations from third parties with a special interest in the content of the analysis. The salary of the research analysts of Equinet Bank AG does not depend on the investment banking transactions of the company. Nevertheless, this does not rule out the payment of a bonus which depends on the overall financial performance of the bank. Particular care is taken that the individual performance of each research analyst of Equinet Bank AG is not being assessed by a manager of another business division with similar or same interests. To assure a highest degree of transparency Equinet Bank AG regularly provides - on a quarterly basis – a summary according to Para 5 Sec. 4 No. 3 of the Ordinance on the Analysis of Financial Instruments (FinAnV). It informs about the overall analysts recommendations and sets them in a relationship to those companies, for which Equinet Bank provided investment banking services within the last twelve months. This summary is published via our website http://www.Equinet Bank-ag.de. Furthermore, we refer to our conflict of interest policy as well as the German Securities Trading Act (WpHG) and the Ordinance on the Analysis of Financial Instruments (FinAnV) provided in the download area of our website http://www.Equinet Bank-ag.de.

Remarks

Recommendation System Buy - The stock is expected to generate a total return of over 20% during the next 12 months time horizon. Accumulate - The stock is expected to generate a total return of 10% to 20% during the next 12 months time horizon. Hold - The stock is expected to generate a total return of 0% to 10% during the next 12 months time horizon Reduce - The stock is expected to generate a total return of 0 to -10% during the next 12 months time horizon Sell - The stock is expected to generate a total return below -10% during the next 12 months time horizon Basis of Valuation

Equinet Bank uses for valuation purposes primarily DCF-Valuations and Sum-Of-The-Parts-Valuations as well as peer group comparisons. Share prices Share prices in this analysis are the German closing prices of the last trading day before the publication. Sources Equinet Bank has made any effort to carefully research all information contained in the analysis. The information on which the analysis is based has been obtained from sources which we believe to be reliable such as, for example, Reuters, Bloomberg and the relevant press as well as the company which is the subject of the analysis. Only that part of the research note is made available to the issuer, who is the subject of the analysis, which is necessary to properly reconcile with the facts. Should this result in considerable changes a reference is made in the research note. Actualizations Opinions expressed in this analysis are our current opinions as of the issuing date indicated on this document. We do not commit ourselves in advance to whether and in which intervals updates are made.

S&T AG

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DISCLAIMER

THE PREPARATION OF THIS DOCUMENT IS SUBJECT TO REGULATION BY GERMAN LAW. THIS DOCUMENT IS BEING SUPPLIED TO YOU SOLELY IN YOUR CAPACITY AS A PROFESSIONAL INSTITUTIONAL INVESTOR FOR YOUR INFORMATION AND MAY NOT BE REPRODUCED OR PASSED ON, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON OR PUBLISHED, IN WHOLE OR IN PART, FOR ANY PURPOSE. NEITHER THIS DOCUMENT NOR ANY COPY OF IT MAY BE TAKEN OR TRANSMITTED INTO AUSTRALIA, CANADA OR JAPAN OR DISTRIBUTED, DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA OR JAPAN OR TO ANY RESIDENT THEREOF. THE DELIVERY OF THIS RESEARCH REPORT TO U.S. PERSONS IN THE UNITED STATES OF AMERICA IS MADE BY AND UNDER THE RESPONSIBILITY OF GSN NA, INC. (REGISTERED WITH THE SEC). THIS RESEARCH REPORT IS ONLY INTENDED FOR PERSONS WHO QUALIFY AS MAJOR U.S. INSTITUTIONAL INVESTORS, AS DEFINED IN SECURITIES EXCHANGE ACT RULE 15A-6, AND DEAL WITH GSN NA, INC. HOWEVER, THE DELIVERY OF THIS RESEARCH REPORT OR SUMMARY TO ANY U.S. PERSON SHALL NOT BE DEEMED A RECOMMENDATION OF GSN NA, INC. TO EFFECT ANY TRANSACTIONS IN THE SECURITIES DISCUSSED HEREIN OR AN ENDORSEMENT OF ANYOPINION EXPRESSED HEREIN. GSN NA, INC. MAY FURNISH UPON REQUEST ALL INVESTMENT INFORMATION AVAILABLE TO IT SUPPORTING ANY RECOMMENDATIONS MADE IN THIS RESEARCH REPORT. ALL TRADES WITH U.S. RECIPIENTS OF THIS RESEARCH SHALL BE EXECUTED THROUGH GSN NA, INC. THIS DOCUMENT IS FOR DISTRIBUTION IN THE U.K. ONLY TO PERSONS WHO HAVE PROFESSSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE “ORDER”) OR (ii) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, NAMELY HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS ETC (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “RELEVANT PERSONS”). THIS DOCUMENT MUST NOT BE ACTED ON OR RELIED UPON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS DOCUMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THE DISTRIBUTION OF THIS DOCUMENT IN OTHER JURISDICTIONS OR TO RESIDENTS OF OTHER JURISDICTIONS MAY ALSO BE RESTRICTED BY LAW, AND PERSONS INTO WHOSE POSSESSION THIS DOCUMENT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, ANY SUCH RESTRICTIONS. BY ACCEPTING THIS REPORT YOU AGREE TO BE BOUND BY THE FOREGOING INSTRUCTIONS. YOU SHALL INDEMNIFY EQUINET BANK AGAINST ANY DAMAGES, CLAIMS, LOSSES, AND DETRIMENTS RESULTING FROM OR IN CONNECTION WITH THE UNAUTHORIZED USE OF THIS DOCUMENT. This report is for informational purposes only and has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. This publication is intended to provide information to assist institutional investors in making their own investment decisions, not to provide investment advice to any specific investor. Therefore, investments discussed and recommendations made herein may not be suitable for all investors: readers must exercise their own inde-pendent judgment as to the suitability of such investments and recommendations in the light of their own investment objectives, experience, taxation status and financial position. The information herein is believed by Equinet Bank to be reliable and has been obtained from sources believed to be reliable, but Equinet Bank makes no representation as to the accuracy or completeness of such information. The information given in this report is subject to change without notice; it may be incomplete or condensed and it may not contain all material information concerning the Company. Opinions expressed herein may differ or be contrary to opinions expressed by other business areas of the Equinet Bank group as a result of using different assumptions and criteria. Equinet Bank is under no obligation to update or keep the information current. Equinet Bank provides data concerning the future development of securities in the context of its usual research activity. However, if a financial instrument is denominated in a currency other than an investor’s currency, a change in exchange rates may adversely affect the price or value of, or the income derived from, the financial instrument, and such investor effectively assumes currency risk. In addition, income from an investment may fluctuate and the price or value of financial instruments de-scribed in this report, either directly or indirectly, may rise or fall. Furthermore, past performance is not necessarily indicative of future results. Neither the author nor Equinet Bank accepts any liability whatsoever for any loss howsoever arising from any use of this publication or its contents or otherwise arising in connection herewith, except as provided for under applicable regulations. Equinet Bank shall only be liable for any damages intentionally caused or which result from any gross negligence of Equinet Bank. Further Equinet Bank shall be liable for the breach of a material obligation of Equinet Bank, however, limited to the amount of the typical foreseeable which shall in no event exceed the amount of EUR 10,000. German law shall be applicable and court of jurisdiction for all disputes shall be Frankfurt/Main (Germany).

Competent Supervisory Authority: Bundesanstalt für Finanzdienstleistungsaufsicht -BaFin- (Federal Financial Supervisory Authority) Graurheindorfer Straße 108, 53117 Bonn and

Marie-Curie-Str. 24-28, 60439 Frankfurt am Main

S&T AG

Page 38

Source: Factset & ESN, price data adjusted for stock splits. This chart shows equinet Bank continuing coverage of this stock; the current analyst may or may not have covered it over the entire period. Current analyst: Cengiz Sen (since 27/11/2017)

Recommendation history for S&T AG

Date Recommendation Target price Price at change date24. Nov 17 Buy 21.00 17.67

6

8

10

12

14

16

18

20

22

Nov16

Dez16

Jan17

Feb17

Mrz17

Apr17

Mai17

Jun17

Jul17

Aug17

Sep17

Okt17

Nov17

Dez17

Buy Accumulat Neut Reduce Sell Not rated

Price history Target price history

S&T AG

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ESN Recommendation System

The ESN Recommendation System is Absolute. It means that each stock is rated on the

basis of a total return, measured by the upside potential (including dividends and capital

reimbursement) over a 12 month time horizon.

The ESN spectrum of recommendations (or ratings) for each stock comprises 5

categories: Buy (B), Accumulate (A), Neutral (N), Reduce (R) and Sell (S).

Furthermore, in specific cases and for a limited period of time, the analysts are allowed to

rate the stocks as Rating Suspended (RS) or Not Rated (NR), as explained below.

Meaning of each recommendation or rating:

Buy: the stock is expected to generate total return of over 15% during the next 12 months time horizon

Accumulate: the stock is expected to generate total return of 5% to 15% during the next 12 months time horizon

Neutral: the stock is expected to generate total return of -5% to +5% during the next 12 months time horizon

Reduce: the stock is expected to generate total return of -5% to -15% during the next 12 months time horizon

Sell: the stock is expected to generate total return under -15% during the next 12 months time horizon

Rating Suspended: the rating is suspended due to a change of analyst covering the stock or a capital operation (take-over bid, SPO, …) where the issuer of the document (a partner of ESN) or a related party of the issuer is or could be involved

Not Rated: there is no rating for a company being floated (IPO) by the issuer of the document (a partner of ESN) or a related party of the issuer

Certain flexibility on the limits of total return bands is permitted especially during higher phases of volatility on the markets

Equinet Bank Ratings Breakdown

For full ESN Recommendation and Target price history (in the last 12 months) please see ESN Website Link

Date and time of production: 28 November 2017: 7:22 CET First date and time of dissemination: 28 November 2017: 7:27 CET

Buy39%

Accumulate27%

Neutral26%

Reduce6%

Sell2%

http://www.esnpartnership.eu/research_and_database_access

S&T AG

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Disclaimer: These reports have been prepared and issued by the Members of European Securities Network LLP (‘ESN’). ESN, its Members and their affiliates (and any director, officer or employee thereof), are neither liable for the proper and complete transmission of these reports nor for any delay in their receipt. Any unauthorised use, disclosure, copying, distribution, or taking of any action in reliance on these reports is strictly prohibited. The views and expressions in the reports are expressions of opinion and are given in good faith, but are subject to change without notice. These reports may not be reproduced in whole or in part or passed to third parties without permission. The information herein was obtained from various sources. ESN, its Members and their affiliates (and any director, officer or employee thereof) do not guarantee their accuracy or completeness, and neither ESN, nor its Members, nor its Members’ affiliates (nor any director, officer or employee thereof) shall be liable in respect of any errors or omissions or for any losses or consequential losses arising from such errors or omissions. Neither the information contained in these reports nor any opinion expressed constitutes an offer, or an invitation to make an offer, to buy or sell any securities or any options, futures or other derivatives related to such securities (‘related investments’). These reports are prepared for the clients of the Members of ESN only. They do not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive any of these reports. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in these reports and should understand that statements regarding future prospects may not be realised. Investors should note that income from such securities, if any, may fluctuate and that each security’s price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in these reports. In addition, investors in securities such as ADRs, whose value are influenced by the currency of the underlying security, effectively assume currency risk. ESN, its Members and their affiliates may submit a pre-publication draft (without mentioning neither the recommendation nor the target price/fair value) of its reports for review to the Investor Relations Department of the issuer forming the subject of the report, solely for the purpose of correcting any inadvertent material inaccuracies. Like all members employees, analysts receive compensation that is impacted by overall firm profitability For further details about the analyst certification, the specific risks of the company and about the valuation methods used to determine the price targets included in this report/note, please refer to the specific disclaimer pages prepared by the ESN Members. In the case of a short note please refer to the latest relevant published research on single stock or contact the analyst named on the front of the report/note for detailed information on the valuation methods, earning estimates and risks. A full description of all the organisational and administrative measures taken by the Members of ESN to manage interest and conflicts of interest are available on the website of the Members. Research is available through the ESN Members sales representative. ESN will provide periodic updates on companies or sectors based on company-specific developments or announcements, market conditions or any other publicly available information. Unless agreed in writing with an ESN Member, this research is intended solely for internal use by the recipient. Neither this document nor any copy of it may be taken or transmitted into Australia, Canada or Japan or distributed, directly or indirectly, in Australia, Canada or Japan or to any resident thereof. This document is for distribution in the U.K. Only to persons who have professional experience in matters relating to investments and fall within article 19(5) of the financial services and markets act 2000 (financial promotion) order 2005 (the “order”) or (ii) are persons falling within article 49(2)(a) to (d) of the order, namely high net worth companies, unincorporated associations etc (all such persons together being referred to as “relevant persons”). This document must not be acted on or relied upon by persons who are not relevant persons. Any investment or investment activity to which this document relates is available only to relevant persons and will be engaged in only with relevant persons. The distribution of this document in other jurisdictions or to residents of other jurisdictions may also be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. 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www.bancaakros.it regulated by the CONSOB - Commissione Nazionale per le Società e la Borsa

www.caixabi.pt regulated by the CMVM - Comissão do Mercado de Valores Mobiliários

www.cmcicms.com regulated by the AMF - Autorité des marchés financiers

www.equinet-ag.de regulated by the BaFin - Bundesanstalt für Finanzdienstleistungsaufsicht

www.ibg.gr regulated by the HCMC - Hellenic Capital Market Commission

www.nibc.com regulated by the AFM - Autoriteit Financiële Markten

www.op.fi regulated by the Financial Supervision Authority

www.valores.gvcgaesco.es regulated by CNMV - Comisión Nacional del Mercado de Valores

Members of ESN (European Securities Network LLP)

Banca Akros S.p.A. Viale Eginardo, 29 20149 MILANO Italy Phone: +39 02 43 444 389 Fax: +39 02 43 444 302

GVC Gaesco Beka, SV, SA

C/ Marques de Villamagna 3 28001 Madrid Spain Phone: +34 91 436 7813

Caixa-Banco de Investimento Avenida João XXI, 63 1000-300 Lisboa Portugal Phone: +351 21 313 73 00

Fax: +351 21 389 68 98

CM - CIC Market Solutions 6, avenue de Provence 75441 Paris Cedex 09 France Phone: +33 1 53 48 81 93

equinet Bank AG

Gräfstraße 97 60487 Frankfurt am Main Germany Phone:+49 69 – 58997 – 212 Fax:+49 69 – 58997 – 299

OP Corporate Bank plc

P.O.Box 308 Teollisuuskatu 1, 00013 Helsinki Finland Phone: +358 10 252 011 Fax: +358 10 252 2703

NIBC Bank N.V.

Gustav Mahlerlaan 348 P.O.Box 235 1082 ME Amsterdam The Netherlands Phone: +31 20 550 8500 Fax: +31 20 626 8064

Investment Bank of Greece

32 Aigialeias Str & Paradissou, 151 25 Maroussi, Greece Phone: +30 210 81 73 383

http://www.bancaakros.it/

http://www.caixabi.pt/

https://mail.esnpartnership.eu/owa/redir.aspx?C=8Zt3eXAOIkqYEQDE_-yjO4gceHQnAtMIAKuq5wlXoeMctWfJzR5HnUAHD5WapHeCCa8AyfgTFB4.&URL=http%3a%2f%2fwww.cmcicms.com

http://www.equinet-ag.de/

http://www.ibg.gr/

http://www.op.fi/

http://www.valores.gvcgaesco.es/

Documents

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