ROCK DRILLING TOOLS

Helena Hedblom, President

COMMITTED TO SUSTAINABLE PRODUCTIVITY

We stand by our responsibilities towards our customers,

towards the environment and the people around us.

We make performance stand the test of time. This is what

we call – Sustainable Productivity.

HOW TO DEVELOP SERVICE AND CONSUMABLE BUISNESS ?

SAFETY SHARE Safer, more productive and improved working environment

February 24, 2014

Atlas Copco Group Presentation

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Atlas Copco Mine Safety

CUSTOMER-FOCUSED STRUCTURE

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Industrial Technique

Industrial Technique Service

MVI Tools and Assembly Systems

General Industry Tools and Assembly Systems

Chicago Pneumatic Tools

Group Management and corporate functions

Compressor Technique Service

Industrial Air

Oil-free Air

Vacuum Solutions

Gas and Process

Quality Air

Airtec

Compressor Technique

Mining and Rock Excavation Technique

Mining and Rock Excavation Service

Underground Rock Excavation

Surface and Exploration Drilling

Drilling Solutions

Rock Drilling Tools

Rocktec

Common service providers

President and CEO

Board of Directors

Construction Technique

Construction Technique Service

Specialty Rental

Portable Energy

Road Construction Equipment

Construction Tools

ROCK DRILLING TOOLS DIVISION

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3800 EMPLOYEES

HEADQUARTERS Fagersta

MANUFACTURING UNITS Sweden, USA, China, India, South Africa,

Australia, Canada

DISTRIBUTION CENTERS Sweden, South Africa,

A complete drill string within all areas

Drill meter contracts

A global service organization

Grinding and maintenance

OUR BUSINESS CONCEPT

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PRODUCT PORTFOLIO

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Tophammer Down-the-hole Rotary Raiseboring

PDC Pneumatic rock drills

§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§

Geotechnical drilling Ground support eqpt

Exploration eqpt

PRODUCT PORTFOLIO

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Tophammer Down-the-hole Rotary Raiseboring

PDC Pneumatic rock drills

§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§

Geotechnical drilling Ground support eqpt

Exploration eqpt

APPLICATION AREAS

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Underground Surface Exploration Wells / Energy holes

Oil and Gas Construction

Just about anywhere

VALUE ORIENTED BUISNESS

Partnership - long term

Guaranteed performance contract

Cost per meter

Incl Service and consignment stock

Common goal – Customer’s success

COMMITTMENT TO OUR CUSTOMERS

Strong application know how in all Sales Companies

– Spending time on site

– Listening and learning how to improve productivity

Intensive training packages

– Sell value

– Application and product know how

ESSENTIAL REQUIREMENTS FOR CONTRACT SUCCESS

Continuous Improvement

Supply & Logistics

Quality Products

Skilled Professionals

Team Approach

SUSTAINABLE PRODUCTIVITY

Product development

– High predictable quality

– Increase penetration rates

– Decrease use of lubricants

– Increase working life of the entire drill strings

EFFECTIVE SUPPLY CHAIN

Short lead time

Availability > 90 %

On Time Deliveries > 90%

Transport cost balanced

Product company Distribution center Customer center

End users

Sweden / North America

– Focus on advanced processes and global products

– Infrastructure & economy of scale

– Global R&D teams

– Automation

China / India / Africa

– Focus on local products

– Local R&D teams

– Larger manual content

MANUFACTURING STRATEGY

RDT - SWEDEN

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Fagersta

Fagersta • Headquarter

• Production

Fagersta • Production

• Distribution

Fagersta • Production

Ockelbo • Production

Salt Lake City • Production

RDT - NORTH AMERICA

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Grand Prairie • Production

Fort Loudon • Production

Langley, Canada • Production

RDT - ASIA

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Fagersta

CHINA – Shandong • Production

CHINA – Shenyang • Production

INDIA - Hyderabad • Production

CHINA – Xuanhua • Production

RDT - AFRICA AND AUSTRALIA

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Fagersta

SOUTH AFRICA – Springs • Production

• Distribution

AUSTRALIA – Perth • Production

RDT / GDE INTEGRATION

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Fagersta

CANADA – North Bay • Production

• Distribution

FINLAND – Tampere • Production

CHINA – Wuxi • Production

HISTORICAL PERSPECTIVE

2000- 2012

Strong demand mining

Increased metal prices

RDT

Strong volume growth 10 % / year

Capacity issues

Investments – 1,5 BSEK

Acqusitions – 9 companies

Slow down in the market

Reduce Inventories

Efficiency is the main theme for 2014

Restructuring to get cost down

MAIN CHALLENGES 2014

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LONG TERM OUTLOOK

2015-2020

Metal prices to start increase from 2015

Ore production continue to grow from 2015

Construction market – started to grow already

RDT

Profitable organic growth

– Market leaders

– Global Market share 30%

Acqusitions

HOW TO GROW SERVICE AND CONSUMABLE BUISNESS

COMMITTED TO

SUSTAINABLE PRODUCTIVITY.