First  Quarter  2016  Earnings  Conference

28  April,  2016

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Today’s  presenters

JOHAN  MENCKEL

CEO

Since:  2012Gränges  since:  2004

OSKAR  HELLSTRÖM

CFO

Since:  2011

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Gränges  is  the  global  leader  with  a  market  share  of  20%

Sales  and  Technical  support

Sales  destinations

Percentage  of  sales  volume  FY  2015

FINSPÅNG,SWEDEN

SHANGHAI,  CHINA

38%16% New  York

Sao  Paolo

Pune

Seoul

Tokyo

46%

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� Sales  volume  increased  by  5.7%  

� Adjusted  operating  profit  was  unchanged  at  SEK  155  million

� Tailwind   from  favorable  exchange  rates  was  offset  by  negative  price  and  mix  effects  and  the  aluminium  premium  price  lag

� Earnings  per  share  of  SEK  1.25  

� Cash  flow  before  financingactivities  of  SEK  -­22  million

� Strong  financial  position

Summary  Q1  2016  – Volume  growth  and  stable  profit

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Source:  IHS  Automotive,  April  11,  2016

Market  growth  of  3%  expected  for  full  year  2016

Light  vehicle  production  growth  (YoY)

Region

Asia

Europe

Americas

Global

Q1  2016 Q2  2016  outlook FY  2016  outlook

+1%

+2%

+1%

0%

+4%

+4%

+6%

+2%

+3%

+2%

+4%

+2%

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Europe  and  North  America  show  good  growth  whereas  sales  volume  in  Asia  remained  flat  in  the  first  quarter

Asia Europe Americas

� Increased  sales  to  domestic  heat  exchanger  producers  in  China

� Lower  sales  to  costumers  in  other  Asian  markets

� Continued  growth  for  heat  exchanger  materials

� Increased  sales  of  scrap  based  products

� Higher  contracted  volumes  with  several  customers

20.7 19.6 17.6 17.520.8

Q1 Q2 Q3 Q4 Q1

16.0 16.4 14.9 15.4 16.6

Q1 Q2 Q3 Q4 Q1

5.9 7.4 6.5 6.0 7.8

Q1 Q2 Q3 Q4 Q1

20162015

Gränges  sales volume (ktonnes)

+0% +3%

+32%

20162015 20162015

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2020  goal  and  strategy

� Grow  significantly  above  the  market  rate

� Become  the  market  leader  in  all  geographical  regions

� Maintain  good  and  sustainable  profitability

Drive  growth throughinnovation

• Lead  the  development  of  heat  exchanger  materials

• Offer  the  most  advanced  solutions

• Be  the  preferred  partner  for  our  customers

Create value from  sustainability

• Zero  accident  target• Reduce  waste• Increase  recycling• Ensure  diversity• Be  an  attractive  employer

Increase  efficiencythrough  continuous  improvements

• Improve  process  stability• Increase  productivity• Increase  energy  efficiency• Improve  metal  management

Grow  presencethrough  structural  

expansion  

• Add  production  capacity  in  North  America

• Increase  production  capacity  in  Asia

• Expand  into  adjacent  market  segments

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Volume  growth  and  stable  profit  in  first  quarter

Rolling  12  months  sales  volume  and  adjusted  operating  profit

160 160 160 160 161 163 163 164 166

152 154 155159158

147 149 148

362 374348

372 371401

437 444463

521 528 541 541494

245199

286

100

120

140

160

180

200

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q150

150

250

350

450

550 Adjusted  operating  profit  (SEK  million)

Sales  volume  (ktonnes)

Sales  Volume Adjusted  Operating  Profit

2012 2013 2014 2015 2016

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1.  Adjusted  for  items  affecting  comparability.2.  Basic,  historical  earnings  per  share  has  been  calculated  on  the  same  number  of  shares  as  of  today.  

Volume  growth  and  stable  profit  in  first  quarter

SEK  million Q1

Financial  overview  

Rolling  12  months

2016 2015 Change Mar  2016 Dec  2015 Change

Sales  volume  (ktonnes) 45.1 42.7 5.7% 166.4 163.9 1.5%

Net  sales 1,360 1,456 -­6.6% 5,398 5,494 -­1.7%

Adjusted  operating  profit1 155 155 0.3% 541 541 0.1%

Adjusted  operating  margin  (%) 11.4 10.6 0.8  ppt 10.0 9.8 0.2  ppt

Adjusted  operating  profit  per  tonne  (kSEK) 3.4 3.6 -­0.2 3.3 3.3 -­

Operating  profit 155 155 0.3% 539 538 0.1%

Profit  for  the  period 94 111 -­15.9% 361 379 -­4.7%

Earnings  per  share2  (SEK) 1.25 1.49 -­0.24 4.84 5.07 -­0.24

Cash  flow  before  financing  activities -­22 -­1 n/a 579 600 -­3.5%

Return  on  capital  employed,  R12  (%) 18.2 18.1 0.1  ppt

Net  debt  /  adjusted  EBITDA,  R12 0.4 0.4 -­

10

206

-­154

-­60-­19

-­14-­316

-­275

-­400

-­300

-­200

-­100

0

Cash  flow  before  financing  -­22

Net  debt  was  SEK  316  million  at  the  end  of  the  first  quarter

Change  in  net  debt  

Net  debt  position  (SEK  million)

Net  debtQ4  2015

Adjusted  EBITDA

Change  in  working  capital

Other  operating  items

Investments  &  divestments  of  fixed  assets

FX  &  other Net  debtQ1  2016

0.4 0.4

Net  debt  over  adjusted  EBITDA  (rolling  12  months)

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� Global  Light  Vehicle  Production  is  expected  to  grow  4.2%1 in  Q2  2016  

� Gränges’  sales  volume  is  expected  to  develop  in  line  with  the  market  during  Q2  2016

� The  aluminium  premium  has  stabilised  and  is  not  expected  to  have  any  substantial  effect  on  profitability  for  the  remainder  of  2016

� For  full  year  2016  global  Light  Vehicle  Production  is  expected  to  grow  3.0%1

with  growth  expected  in  all  geographical  regions

� Positive  outlook  for  2016  – more  stableconditions  in  China

� Price  competition  in  Asia  is  expected  to  have  some  impact  this  year

Outlook

1Source:   HIS  Automotive,  April  11,  2016

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� A  solid  quarter  with  good  sales  growth  and  stable  earnings

� Sales  volume  increased  by  5.7%

� Adjusted  operating  profitstable  at  SEK  155  million

� Solid  financial  position

� Well  positioned  for  profitable  growth

Summary  of  first  quarter

Q&AJohan  Menckel,  CEO

Oskar  Hellström,  CFO