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Investor Presentation

Greg Poux-Guillaume | CEO | January 11, 2017

Baader Helvea – Swiss Equity Conference

Investor Presentation January 20182

THE SAFE HARBOR STATEMENT UNDER THE US PRIVATE SECURITIES

LITIGATION REFORM ACT 1995

This presentation may contain forward-looking statements, including, but not limited

to, projections of financial developments and future performance of materials and

products, containing risks and uncertainties. These statements are subject to

change based on known and unknown risks and various other factors that could

cause the actual results or performance to differ materially from the statements

made herein. Furthermore, the information shown herein has been compiled to the

best knowledge of the authors. However, Sulzer Ltd. and its affiliated companies,

including all directors, officers and employees cannot assume any responsibility for

the quality of the information, and therefore any representations or warranties

(expressed or implied) as to the accuracy or completeness of the information is

excluded.


Agenda

3

1. Overview

2. Update on Sulzer Full Potential program

3. Financial review

4. Acquisitions

5. Outlook


Divisional split shows new structure; Aftermarket 54%1

4

Order intake H1 17

by division

Order intake H1 17

by region

Order intake H1 17

by type1

13%

17%

34%

36%

Applicator Systems

Chemtech

Rotating Equipment Services

Pumps Equipment

44%

23%

33%

Europe, Middle East, Africa

Asia-Pacific

Americas

54% 46%

Aftermarket

Equipment

1. Excluding APS division


Rebalancing continues: O&G 43% of order intake in H1

5

Power

Water

GI

17%

11%

29%

Oil & Gas

43% 1

Low O&G market impacting Power pricing

APAC remains the most active market

Price pressure in gas turbine service driven by OEMs

Solid growth in Waste Water

Engineered Water projects create volatility

Growth in GI driven by APS division (strong organic growth in

Dental and Adhesives plus Beauty segment consolidation)

Positive trend in Pulp and Paper

Market continues to be challenging, with capex of oil

companies settling at depressed levels

Upstream bottoming, slight rebound in Downstream and CPI

“Lower for Longer” setting in

1. Includes 7% Chemical Process Industry (CPI)


Agenda

6

1. Overview


3. Financial review

4. Acquisitions

5. Outlook


SFP ahead of schedule and on track for CHF 200m

7

CHF 150m P&L impact

achieved to date

All of the CHF 200m

savings targeted by

20181 secured through

actions already launched

Cost vs. benefit ratio

unchanged

Timing risk decreasing

(in CHF millions)

1. Gross savings, pre market impact

88

26

36

~20-40

124

~160-180

200

-80

-24

2018E2016A

~-55

2015A 2017E

-96

Cost savings

(excl. direct

procurement)

Implementation

costs

~ -10

H1 A

H2 E


All SFP savings categories progressing well

8

150

ChemtechRotating Eqt.

Services

Pumps

EquipmentSG&A

Indirect

Procurement

~200m

2017

(in CHF millions)

FY 16: 88m

FY 15: 36m

Highlights H1 2017

Procurement achieved considerable savings in direct (not included in SFP) and indirect

SG&A: leaner and progressing in new setup (Finance BPO, HR, IT)

Relocation of resources to low-cost countries improving overall cost structure

Product value engineering continuing to drive competitiveness

Cost savings by lever

H1 17: 26m


Agenda

9

1. Overview


3. Financial review

4. Acquisitions

5. Outlook


685

627

685

739

642

732758

837

790

Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17

Q3 17 orders grew by 22% YOY1 (7% organically)

10

(in CHF millions ) +22%

-6%

Quarterly order intake Commentary on Q3

Strong organic growth on low

2016 base in Pumps Equipment

(+14%) and Chemtech (+12%).

Organically, Rotating

Equipment Services up 4%,

Applicator Systems flat.

Acquisition impact of Geka,

Ensival Moret, Rotec, VIEC

was CHF89m in total

FX impact CHF +10m

1. Adjusted for currency effects


9 months order intake by division

11

45%

33%

22%

In CHF millions 9M 17 9M 16 YOY YOY adj.1 YOY org.2

Total Sulzer 2,385 2,065 15.5% 15.3% 3.7%

Total Divisions 2,423 2,095 15.7% 15.4% 3.9%

Pumps Equipment 900 818 10.1% 10.2% 4.0%

Rotating Equipment Services 838 761 10.2% 9.0% 1.9%

Chemtech 372 339 9.7% 9.8% 8.7%

Applicator Systems 313 177 76.7% 77.3% 3.3%

Adj./Eliminations -39 -29


2. Adjusted for currency and acquisitions effects

Order intake 9 months (Jan-Sep)

By region

Americas

Europe, Middle East, Africa

Asia-Pacific

FX impact CHF +4m

Total acquisition impact

CHF 239m

Commentary on 9M


H1 results

Order intake up 2% YOY organically for H1 and Q2

12

Q2 Order intake up 2% YOY

organically (10% adjusted)

Order intake gross margin

decreased on Oil & Gas and

Power orders

Sales declined because of

lower starting backlog and

timing of projects in Pumps

Equipment

opROSA improved despite

lower organic volumes on

positive SFP impact

EBIT 2016 includes 35.4m

Swiss pension plans gain

FTE increase driven by

acquisitions and APS

In CHF millions H1 17 H1 16 YOY YOY adj.1 YOY org.2

Order intake 1,595 1,423 12.0% 12.5% 1.9%

Order intake gross margin 34.2% 34.6%

Order backlog (Dec 31) 1,649 1‘ 381 14.6%

Sales 1,429 1381 3.4% 3.7% -6.7%

opEBITA 106 99 7.5% 7.7% -1.0%

opROSA % 7.4% 7.1%

EBIT 55 823 -32.3%

ROS % 3.9% 5.9%

Core net income 76 63 20.1%

Core EPS (in CHF) 2.2 1.9

Free cash flow -2.5 3.7 –

FTEs (Dec 31) 15,027 14,005 7.3%

Key figures Commentary


2. Adjusted for currency and acquisitions effects

3. Includes CHF 35.4m pension gain


SFP savings offset headwinds

13

9

22 26

9

106

9899

H1 16 H1 17

organic

SFPOther

costs

-24

MixMarginVolume

-33

H1 17Acquisitions

Headwinds

–1.5ppSFP cost savings

+2.0pp

opROSA% 7.6%7.1%

Lower opening

backlog in PE

Mainly under-

absorption

Operational EBITA

(in CHF millions )

Water and Pumps Services

compensate lower margins in

O&G and Power

7.4%


Agenda

14

1. Overview


3. Financial review

4. Acquisitions

5. Outlook


Executing on bolt-on acquisitions

15

Seven transactions since April 2016

Acquired at reasonable multiples

Total acquired sales of CHF ~435m

GT VIEC

2016 2017

Sales1

EBITDA margin

EV paid

EV/EBITDA

Consolidated from

20

~16%

22

7x

April 4

2016

160

~18%

280

9.6x

August 23

2016

120

break even

85

—

February 1

2017

35

~20%

28

4x

June 30

2017

mid single digit

—

4

—

February 1

2017

19

>30%

75

<10x2

Sept 29

2017

(in CHF millions )

1. Sales in 2016: Cox 15m; Geka 63m;

Sales in H1 2017: Cox 6m; Geka 92m; Ensival Moret 45m; Rotec 0.2m; VIEC 0.4m

2. Incl. synergies

3. Expected 2018 EBITDA; EV adjusted for tax asset of USD 25m

81

>20%

212

~10x3

Expected

Q1 2018


Building APS – shared industrial core

in a succession of niche markets

16

Production: high precision plastic injection molding

Mark

ets

Dental Healthcare Beauty Ind. Adhesives

Leading market positions in dental, industrial adhesives and beauty B2B verticals

Shared industrial core in innovative high-precision plastic injection molding

Differentiating scale and global presence

Mixpac


With Geka, the applicator and packaging solution

leader, APS enters cosmetics segment

17

Date August 23, 2016

Sales (EUR) ~150m

Profitability 18% EBITDA

Employees ~730

EV paid

(EUR)

260m

EV/EBITDA 9.6x

Rational Becoming leader in high-

precision injection molding

technologies for innovative B2B

mixing and applicator solutions

Significant cost synergies

Complementary regional

footprint


PC Cox – strengthens APS position in industrial segment

18

Date April 4, 2016

Sales (CHF) 20m

Profitability 16% EBITDA

Employees ~170

EV paid

(CHF)

22m

EV/EBITDA 7x

Rational Leading manufacturer of

dispensers for industrial

applications

Strengthened position as a

solution provider in the area of

mixing, dosing and application

systems

Complementary regional

footprint


Transcodent completes APS’s dental portfolio

Date September 29, 2017

Sales (CHF) 19m

Profitability >30% EBITDA

Employees 80

EV paid

(CHF)

75m

EV/EBITDA <10x (incl. synergies)

Rational Transcodent is the leading

provider of multiple dose and unit

dose application systems,

needles, tips and capsules for

the dental market.

Complementary product portfolio:

Transcodent rounds out APS’ s

dental portfolio

19


JWC expands Sulzer’s waste water treatment portfolio

20

Date Expected closing in Q1 2018

Sales (CHF) 81m

Profitability >20% EBITDA

Employees ~230

EV paid

(CHF)

212m

(incl. tax asset of 25m)

EV/EBITDA ~10x (adj. for tax asset)

Rational Complementary equipment in

waste water treatment

Improved access to key US

municipal waste water treatment

market

Growing aftermarket share:

55% of business


Ensival Moret strengthens pumps General Industry portfolio

21

Date February 1, 2017

Sales (CHF) 123m

Profitability breakeven

Employees ~730

EV paid

(CHF)

85m

EV/EBITDA –

Rational Complementary application

portfolio in fertilizers, sugar,

mining, and chemicals

Closes product gaps in axial

flow pumps, slurry pumps

Significant synergies, relutive

starting in year 2


Rotec GT brings gas turbine services in Russia to next level

22

Date June 30, 2017

Sales (CHF) 35m

Profitability ~20% EBITDA

Employees ~50

EV paid

(CHF)

28m

EV/EBITDA 4x

Rational Become a sizable player in the

Russian/CIS GT service market

with revenues of about CHF 40m

(incl. Sulzer Russia service)

Increase local content

(refurbishment of spare parts

in own facility)

GT


VIEC rounds out Chemtech’s upstream product portfolio

Date February 1, 2017

Sales (CHF) Mid-single digit

Profitability –

Employees 13

EV paid

(CHF)

4m

EV/EBITDA –

Rational Vessel Internal Electrostatic

Coalscer (VIEC) technology

complementary to Chemtech’ s

upstream portfolio for advanced

oil and water separation

Product well recognized in the

market with multiple references

23

VIEC


Agenda

24

1. Overview


3. Financial review

4. Acquisitions

5. Outlook


Financial guidance 2017 as of October 26

25

Order Intake1

Sales1

up 10–12%(previously up 7– 10%)

up 3–5%

Operational ROSA2 % around 8.5%


2. Operational EBITA divided by sales


Summary

26

Order intake grew 7% organically in Q3, 22% including acquisitions

SFP program well on track to reach CHF 200m from 2018 onwards

Achieved additional CHF 26m savings in H1 bringing total to CHF150m

H1 SFP savings more than offset market headwinds for opEBITA margin of 7.4%

All of the CHF 200m savings targeted by 2018 secured through actions already

launched

Solid order growth after 9 months – guidance increased again in October for

FY 2017 order intake

Guidance for order intake increased to +10% to +12% from +7% to +10%

previously (October 26, 2017)

Guidance confirmed for sales and opROSA

– Sales expected to be up 3% to 5%

– opEBITA margin expected to be around 8.5%

Q&A

Greg Poux-Guillaume | CEO

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