2018: A N EXCELLENT YEAR ... OPERATING MARGIN SALES ROCE* BEFORE - PowerPoint PPT Presentation

S HAREHOLDERS ’ A NNUAL G ENERAL M EETING M AY 17, 2019

A GENDA ▪ I NTRODUCTION ▪ S TRATEGY : A SUSTAINABLE GROWTH TRAJECTORY ▪ 2018 R ESULTS ▪ R EPORT BY THE B OARD AND THE C OMMITTEES ▪ R EPORT BY THE STATUTORY A UDITORS ▪ S UMMARY PRESENTATION OF RESOLUTIONS ▪ D IALOG WITH SHAREHOLDERS ▪ V OTE OF RESOLUTIONS Shareholder’s Annual General Meeting – May 17, 2019 2

A SUSTAINABLE GROWTH TRAJECTORY

2018: A N EXCELLENT YEAR ... OPERATING MARGIN SALES ROCE* BEFORE NON-RECURRING ITEMS +10% vs. 2017 +120 points vs. 2017 +200 points vs. 2017 Like-for-like growth 879 92 809 759 800 775 759 75 11.8% 57 9.8% 10.4% 9.2% 7.3% 7.5% 2016 2017 2018 2016 2017 2018 2016 2017 2018 Sales (€m) Operating income before Capital employed in €m non- recurring items (€m) * Operating income before non-recurring items/average weighted capital employed Shareholder’s Annual General Meeting – May 17, 2019 4

... B USY IN TERMS OF EXTERNAL GROWTH FTCAP CALY MERSEN GALAXY LGI CIRPROTEC TECHNOLOGIES IDEALEC 100% Acquisition Joint venture Partnership 100% Acquisition Minority stake 60% Mersen To develop Mersen’s To step up global To capture the solar To look to the future To drive innovation services for the sales market growth chemicals industry Shareholder’s Annual General Meeting – May 17, 2019 5

G ROWTH ACROSS ALL REGIONS LEADING TO A BALANCED BREAKDOWN … +8% +8% NORTH AMERICA EUROPE 33%* 34%* vs. 2017 vs. 2017 SOUTH AMERICA - +17% AFRICA vs. 4%* 2017 +13% ASIA-PACIFIC 29%* vs. 2017 * % of total sales Like-for-like growth in 2018 (as a %) Shareholder’s Annual General Meeting – May 17, 2019 6

... THANKS TO A BRISK MOMENTUM IN ALL MARKETS , PARTICULARLY OUR GROWING MARKETS G ROWING MARKETS ~40% 19% 34% ENERGY PROCESS INDUSTRIES +12%* VS. IN 2017 +7%* VS. 2017 RENEWABLE ENERGIES 19% ELECTRONICS 2018 SALES +13%* VS. 2017 SEMICONDUCTORS POWER ELECTRONICS 17% 11% TRANSPORTATION CHEMICALS +13%* VS. 2017 +6%* VS. 2017 AERONAUTICS *Like-for-like growth ELECTRIC VEHICLES Shareholder’s Annual General Meeting – May 17, 2019 7

F OCUS ON CERTAIN GROWING MARKETS

S OLAR : AN ENERGY SEING STRONG GROWTH NUMBER OF PANEL INSTALLATIONS GROWING SHARPLY 2018-2022 CAGR (est.) +5-7% Annual (GW) 2018 Forecasts 140 [115-125]* 120 2011-2017 CAGR 109 +23% 100 80 2016 Forecasts 60 40 20 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 est. 2020 est. 2021 est. 2022 est. Source: IHS Markit, Exawatt, Mersen estimates * New forecasts early 2019 Shareholder’s Annual General Meeting – May 17, 2019 9

H IGH GROWTH POTENTIAL IN THE SOLAR SECTOR PARTICULARLY FOR PROTECTION AND CONVERSION SOLUTIONS PROTECTION 19% CONVERSION 12% €90m - €100m 2023 (est) Solar sales POLYSILICON 19% 2018 €58m INGOTS 50% 2018 Shareholder’s Annual General Meeting – May 17, 2019 10

A STATIONARY BATTERY MARKET DRIVEN BY SOLAR AND WIND POWER IN THE MEDIUM TERM ANNUAL INSTALLED CAPACITY OF STATIONARY BATTERIES IN MWH 2018-2023 CAGR 35000 +50% 30000 Direct current grids (industrial buildings, utilities) 25000 20000 Solar, wind 15000 10000 5000 Power quality 0 2017 2018 2019 2020 2021 2022 2023 Source: Yole Development, 2017 – residential segment excluded (< 20 kWh) Shareholder’s Annual General Meeting – May 17, 2019 11

M ERSEN SOLUTIONS FOR STATIONARY STORAGE BATTERIES Protection Connection Protection Protection Mersen solutions Li-ion Battery Battery Battery Battery Power battery module rack pack container conversion cell DC AC 10-100kW 2.6W 10-100W 1000W 1 to 100MW Shareholder’s Annual General Meeting – May 17, 2019 12

C HANGE IN OUR OFFER FOR E - VEHICLES BUSBARS – CAPACITOR- COOLING HYBRID PROTECTION FUSES DEVICES End to technical development partnership Strong demand for battery Clear increase in demand for with the VW Group protection solutions and battery connection solutions auxiliary circuits ( including monitoring functions) following changes in specifications from 150 V and up Expansion of our range Developments to be continued with four for 500 V and similar leading international manufacturers Development of a dual offer: New innovative design [busbars + capacitors] at 800 V Product changes planned for the VW Group for power converters Shareholder’s Annual General Meeting – May 17, 2019 13

S TRONG POTENTIAL IN ENERGY STORAGE E-VEHICLES STATIONARY 80% BATTERIES 20% €40m - €60m 2023 (est.) €15m 2018 Shareholder’s Annual General Meeting – May 17, 2019 14

S TRONG POSITION ON THE FAST - GROWING S I C SEMICONDUCTORS MARKET COMPOUND SEMICONDUCTORS MATURE MATURING OTHER MARKET MARKET TECHNOLOGIES RAW MATERIAL/ GaN/ Silicon SiC GaN GaAs InP Sapphire SUBSTRATE Memory Power component RF Opto COMPONENTS Microprocessor LED chip (IGBT, MOSFET, JFET) component electronic Networks and Speed Energy Renewable END-MARKET EV Lighting Communications computers drives storage energies Shareholder’s Annual General Meeting – May 17, 2019 15

S I C SEMICONDUCTORS MARKET SET TO ACCELERATE AFTER 2020-2022 IN LINE WITH EV MARKET GROWTH SIC COMPONENTS MARKET IN USD MILLIONS 1200 2020-2022 CAGR +30%-40% Other 1000 Speed drivers 800 EV 2016-2019 CAGR 600 +18% Renewables 400 Rail 200 Power supply 0 2016 2017 2018 2019 2020 2021 2022 Source: Yole Development, Power SiC 2017 – Materials, Devices and Applications Shareholder’s Annual General Meeting – May 17, 2019 16

M ERSEN MONOCRYSTALLINE S I C SOLUTIONS Induction coil €50m - €60m 2,400°C +/- 2°C Quartz tubing 2023 (est.) SiC INSULATION GRAPHITE CRUCIBLE Reservoir of SiC powder €20m 2018 Shareholder’s Annual General Meeting – May 17, 2019 17

2019 O BJECTIVES Like-for-like growth* Operating margin before in sales versus 2018 non-recurring items Between 10.5 and 10.7% Between 2% and 5% (vs. 10.4% in 2018) 2019 Contribution from 2018 Capex acquisitions ~2% Between €60m and €70m * At constant exchange rates and scope of consolidation Shareholder’s Annual General Meeting – May 17, 2019 18

P ROGRAM OF INVESTMENTS TO UNDERPIN GROWTH IN 2020-2022 2019 €60m - €70m SiC semiconductors Solar power 45% Growing markets EV SiC laser mirrors Digital 5% Information systems transformation Reduced 10% Environment, Safety, Compliance environmental footprint 40% Other Maintenance, Productivity Shareholder’s Annual General Meeting – May 17, 2019 19

A MEDIUM - TERM GROWTH BASED ON AN AMBITIOUS APPROACH OF SOCIAL AND ENVIRONMENTAL RESPONSIBILITY A SOCIALLY RESPONSIBLE FOCUSING ON MARKETS AND REDUCING ENVIRONMENTAL A SHARED CSR CULTURE GROUP PRODUCTS FOOTPRINT Autonomy of the teams to implement the policy Strengthen best practices Building on Mersen’s Sustainable development markets fundamentals High performance, innovative products Shareholder’s Annual General Meeting – May 17, 2019 20

O UR CSR MEDIUM - TERM AMBITIONS Ecological footprint 55% of sales linked to sustainable development by 2021 of our products Ecological products Improve by +15 pts the part of waste recovered by 2021 of our facilities CSR footprint of our Improve and secure the social and environmental suppliers performance of our supplier base Develop and consolidate a culture of health and safety Health and safety of within the Group our employees Human capital success rate: +3 pts by 2021 Human capital 25 to 30% female managers and professionals by 2022 100% trained in Open Manager by 2021 Shareholder’s Annual General Meeting – May 17, 2019 21

2018 R ESULTS

S HARP RISE IN PROFITABILITY 10.4% +120 bp As a % Higher prices to 2017 operating margin before 9.2% 9.2% non-recurring items offset the increase in the cost of raw Volume/mix effects +1.7% materials: +1.2% Price effect net positive -0.8% Raw material impact 92 Increase in costs +1.8% 75 Impact of the competitiveness plan* (mainly payroll) -1.5% Inflation, costs offset by the Impact of exchange rates, change in scope and other -1.2% competitiveness plan 2018 operating margin before non-recurring 10.4% items 2017 2018 Operating income before non- recurring items (€m) Shareholder’s Annual General Meeting – May 17, 2019 23

C ONTRASTED PERFORMANCES BY SEGMENT ELECTRICAL POWER ADVANCED MATERIALS 69 Operating income before Operating income before 40 39 non- recurring items (m€) non- recurring items (m€) 50 Operating margin before Operating margin before 10.0% 14.1% 11.0% 11.1% non-recurring items (%) non-recurring items (%) 2017 2018 2017 2018  Positive volume effect  Positive volume effect  Dilutive effect of acquisitions and exchange rates  Productivity gains that outperform inflation  Increase in the cost of certain raw materials with no  Price increases are higher than the increase in raw increase in prices materials costs  Additional resources set aside for energy storage and power electronics Shareholder’s Annual General Meeting – May 17, 2019 24