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Royal Ten Cate Half-yearly results 2013 Outlook 2013

Ir L. de Vries, President and CEO Royal Ten Cate Amsterdam, Thursday 25 juli 2013

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1. Profile, trends and market themes

2. Market drivers

3. Core activities

4. Financial developments half-year 2013

5. Developments per sector

6. Outlook 2013

Half-yearly results TenCate 2013 2

Agenda Presentation half-yearly results Royal Ten Cate 2013

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Two megatrends: Safety & Sustainability

Half-yearly results TenCate 2013 3

Profile, trends and market themes

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Market drivers

• Safety and protection

• Carbon footprint

• Infrastructural developments

• Water management

• Sustainability

• Corporate social responsibility

TenCate operates at growth markets

Half-yearly results TenCate 2013 4

• Modernisation army (safety, weight reduction, mobility)

• New specifications materials

• Modern mobility concepts

• Dewatering and detection systems

• Synthetic turf / water retention and filtration systems

• Process innovations

• Multi-risk solutions in personal safety

DEVELOPMENTS SOLUTIONS

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Core activities Protecting people

Half-yearly results TenCate 2013 5

Technologies Markets Products

Extrusion technology with Textile technologies

Weaving technology and Finish & coating technology

• Specialist fabrics • Composites

• Geotextiles • Synthetic turf

• Defense and special units • Industry and emergency respons • Outdoor • Space and aerospace • Automotive • Armour

• Infrastructure • Environment and watermanagement • Sports and landscaping

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• Revenues € 514 million (-5%; organic -6%; currency effect -1%; acquisitions / divestments +2%) • EBITA € 29 million (-8%; organic -9%; currency effect -1%; acquisitions / divestments +2%) • Net profit drops by 7% to € 13 million • Adverse market circumstances in defence market and badweather circumstances had a negative

impact on revenues; recovery started in second quarter

• Sector Advanced Textiles & Composites: decrease of revenues and results due to shrinking defense expenditures; positive developments TenCate Adanced Composites

• Sector Geosynthetics & Grass: Slow start with recovery during first half-year

• Significant decrease interest bearing debt (- € 74 million) to € 238 million despite acquisition • Net interest bearing debt / EBITDA 2,8

Half-yearly results TenCate 2013

First half-year 2013 Summary

6

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512

434

455 59

2

540

514

521

408 53

0 546

509

0

200

400

600

800

1000

1200 20

08

2009

2010

2011

2012

2013

Revenues and EBITA development Royal Ten Cate

7 Half-yearly results TenCate 2013

Revenues (€ m) 45

21 38

56

31

29

50

21

47

46

19

0

20

40

60

80

100

120

1H 2H

EBITA (€m)

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Revenues by end-market Indicative

Half-yearly results TenCate 2013 8

20%

15%

21%9%

29%

6%

1H12

22%

9%

23%11%

28%

7%

1H13

Personal protection

Defence

Sports & Leisure

Aerospace & Automotive

Infra & Environment

Other

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2009 2010 2011 2012 2013

Defense-revenues* Protecting People – at work

Half-yearly results TenCate 2013 9

Index 2009 = 100 1H

1H

2H

Defense-revenues decreased by 40% compared to 2012

* Protective Fabrics for defense / armour composites

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Other financial information

• Reduction fte’s circa 470 since June 2012, corrected for acquisitions

• Operational cash flow: € 29 million (+56% compared to H1 2012) • Investments: € 4.8 million (H1 2012: € 9.6 million)

• Investments in acquisitions € 22 million

• Net interest bearing debt: € 238 million (H1 2012: € 312 million) • Decrease net interest bearing debt position by € 74 million despite acquisition of Amber

Composites • Net interest bearing debt/ EBITDA ratio H1 2013: 2.8 (well within the covenant: 3.5)

Half-yearly results TenCate 2013 10

PROTECTIVE FABRICS

Developments per sector Sector Advanced Textiles & Composites

Half-yearly results TenCate 2013 11

CORPORATE

248

215

193 29

0

241

228

233

182

255

249

220

0

100

200

300

400

500

600 20

08

2009

2010

2011

2012

2013

Revenues and EBITA developments Advanced Textiles & Composites

12 Half-yearly results TenCate 2013

Revenues (€ m) 31

20

16

41

19

14

31

11 28

29

5

0 10 20 30 40 50 60 70 80

1H 2H

EBITA (€ m)

Protective fabrics • Army and special (police) forces

• Industry and emergency response

• Outdoor

Aerospace and space composites • Commercial aircraft, military aircraft, satellites

• Radomes

Armour composites • Vehicles, airplanes, missiles

• Personal protection

Industrial composites • Automotive, energy etc.

• Parts & components

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Course of events first half-year 2013

• Decrease revenues and results TenCate Protective Fabrics due to decreased deliveries to US army • Revenue growth TenCate Tecasafe™ partly compensates drop TenCate Defender™ M

• Revenues TenCate Advanced Composites increase further

• Revenue increase space and aerospace composites in USA; temporary delay Airbus A380 and A350

• Acquisition Amber Composites supports entrance automotive market

• TenCate Advanced Armour suffers from low government spending • Revenues USA recover in second quarter with well-filled orderbook • TenCate ABDS™ active blast countermeasure system in qualification phase USA government

organisations

Sector Advanced Textiles & Composites

Half-yearly results TenCate 2013 13

TenCate Protective Fabrics

TenCate Advanced Composites

TenCate Advanced Armour

H1 2013 H1 2012

Indicative revenue breakdown sector Advanced Textiles & Composites

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Market group TenCate Protective & Outdoor Fabrics

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• Revenues TenCate Defender™ M below last year • Improvement supplies to US army did not progress in second

quarter • Dozens of armies globally conducting wearing-trials

• Strong growth (>20%) of TenCate Tecasafe™ offers partly compensation • Margins outside defense market are at lower levels

• Introduction inkjet machine protective and outdoor fabrics

TenCate Protective Fabrics

Half-yearly results TenCate 2013 15

Main developments per market group

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CLIP TenCate Outdoor Fabrics Development digital inkjettechnology

Half-yearly results TenCate 2013 16

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Market group TenCate Advanced Composites and TenCate Advanced Armour

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• Growth TenCate Advanced Composites • Revenues space and aerospace composites USA increased • Programs Airbus A380 en A350 below expectations

• Long term outlook unchanged

• TenCate Armor USA recovers in second quarter • Revenue growth in first half-year 2013

• Delayed orders for aerospace armour • European defense spendings are at 10-year low

• Development TenCate ABDS ™ active blast countermeasure

system entered official qualification phase of US government organisations

TenCate Advanced Composites and TenCate Advanced Armour

Half-yearly results TenCate 2013 18

Main developments per market group

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• Strategic focus on components and structural parts

• One stop shop: thermoset and thermoplastic composites

• Optimalisation of choice of materials (broad productportfolio)

• Total solution for OEM by combining knowledge of materials,

process knowledge and design

• Co-operation with OEM and other partners within the

production chain

• Amber Composites offers support to growth ambitions

• Partnerships with BASF and Owens Corning develop

according plan • From October 2013 BASF offers an integral approach for

thermoplastic composites solutions; TenCate is supplier of a portfolio of thermoplastic composites

TenCate Advanced Composites

Half-yearly results TenCate 2013 19

Development automotive composites

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Developments automotive composites

CLIP automotive composites

Half-yearly results TenCate 2013 20

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Developments survivability solutions TenCate ABDS™ active blast countermeasure system

Half-yearly results TenCate 2013 21

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Development survivability solutions

Half-yearly results TenCate 2013 22

TenCate ABDS ™ active blast countermeasure system Te

chno

logy

dev

elop

men

t

Evolve concept to product

Eval

uatio

n Introduce capabilities & assess applications C

omm

erci

aliz

atio

n Enter volume production

Serv

ice

and

enha

nce

Maintenance sustainment and product line expansion

2011 – 2013 2013 – 2016 2016 – 2020

PROTECTIVE FABRICS

Developments per sector Sector Geosynthetics & Grass

Half-yearly results TenCate 2013 23

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237

193

227

268

262

250

261

199 24

3 258

257

0

100

200

300

400

500

600 20

08

2009

2010

2011

2012

2013

Revenues and EBITA development Geosynthetics & Grass

24 Half-yearly results TenCate 2013

Revenues (€ m) 17

5

19

14

16

15

21

12

13

12 16

0 5

10 15 20 25 30 35 40

1H 2H

EBITA (€ m)

Geosynthetics • Infrastructure, agribusiness

• Environmental and water management

Synthetic turf • Sports and landscaping

• Infrastructure

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Course of events first half-year 2013

• Late start of revenue development TenCate Geosynthetics in first half year: • Europe (more specific Eastern Europe) and the USA recovered during the second quarter • Revenues from Asia lagged behind

• Sales organisation within TenCate Geosynthetics reinforced with focus on water management and environmental solutions

• TenCate Grass benefited from improved utilisation rate and lower cost base

Sector Geosynthetics & Grass

Half-yearly results TenCate 2013 25

Geosynthetics

Grass Upstream

Grass Downstream

Indicative revenue breakdown sector Geosynthetics & Grass

H1 2013 H1 2012

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Market group TenCate Geosynthetics

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• Revenues and results TenCate Geosynthetics in first half-year lower than in 2012

• Revenue growth TenCate Geotube® systems 20 percent • Adverse weather circumstances resulted in delay for

infrastructural projects • Recovery in Europe and USA during second quarter

• Focus is on growth of the private sector • Water & Environment and Mining • Oil & gas exploration

TenCate Geosynthetics Main developments per market group

Half-yearly results TenCate 2013 27

Asia

Public Private

Americas Europe

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TenCate Geotube® in Brazil

CLIP Canal do Fundão en Lagunar de Barra in Rio de Janeiro

Half-yearly results TenCate 2013 28

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Market group TenCate Grass

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• Revenue decrease TenCate Grass due to late start of the season in downstream; revenue growth in upstream

• Utilisation rate production first half-year gradually increased; • Improved integration upstream activities and downstream

activities

• TenCate Grass will supply a number of clubs in Dutch first division with synthetic turf pitches; a breakthrough for the professional football sport • Positive for exposure synthetic turf in professional football • Successfull introduction of GreenFields™ MX, woven

synthetic turf pitch

TenCate Grass

Half-yearly results TenCate 2013 30

Main developments per market group

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CLIP GreenFields™ MX Developments integrated synthetic turf systems

Half-yearly results TenCate 2013 31

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Traffic Circle with synthetic turf near Riyadh in Saudi-Arabia Developments landscaping synthetic turf

Half-yearly results TenCate 2013 32

PROTECTIVE FABRICS

Developments per sector Sector Other

Half-yearly results TenCate 2013 33

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• Strategic review Xennia Technology • Reorganisation started in fourth quarter of 2012 finalised

• Emphasis on commercialisation of developed products, knowledge and capabilities

• Result improves despite lower revenues (business focus)

• TenCate Enbi • Improvement of revenues as well as results

TenCate Enbi and Xennia Technology

Half-yearly results TenCate 2013 34

Main developments per market group

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Outlook 2013

Half-yearly results TenCate 2013 35

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Outlook 2013

• Market circumstances remain challenging for the rest of the year • TenCate has confidence in the second half of the year of 2013

• Increased order positions

• More positive picture in respect of sector Advanced Textiles & Composites for second half of the year • Revenue growth in protective fabrics for global industrial markets will continue • Supply TenCate Defender™ M to US army remains at current low level • Revenues aerospace composites for Airbus A380 and A350 increase

• Outlook revenue development sector Geosynthetics & Grass favourable • Increased utilisation rate and cost savings in TenCate Grass will positively contribute to further

profit recovery

Royal Ten Cate NV

Half-yearly results TenCate 2013 36

Protecting people