Investor Presentation West Coast Roadshow August 26-27, 2015 - PowerPoint PPT Presentation

Investor Presentation West Coast Roadshow August 26-27, 2015

Forward-looking statements and non-GAAP financial information This presentation includes “forward - looking” statements within the meaning of the federal securities laws. You can generally identify the company’s forward -looking statements by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “outlook,” “intend,” “may,” “ pos sible,” “potential,” “predict,” “project,” “seek,” “target,” “could,” “may,” “should” or “would” or other similar words, phrases or expressions that convey t he uncertainty of future events or outcomes. The company cautions readers that actual results may differ materially from those expressed or implied in forward-looking statements made by or on behalf of the company due to a variety of factors, such as: the company’s ability to realize the expected benefits of the spi noff; the costs associated with being an independent public company, which may be higher than anticipated; deterioration in world economic conditions, or in economic conditions in any of the geographic regions in which the company conducts business, including additional adverse effects from global economic slowdown, terrorism or hostilities, including political risks associated with the potential instability of governments and legal systems in countries in which the company or its customers conduct business, and changes in currency valuations; the effects of fluctuations in customer demand on sales, product mix and prices in the industries in which the company operates, including the ability of the company to respond to rapid changes in customer demand, the effects of customer bankruptcies or liquidations, the impact of changes in industrial business cycles, and whether conditions of fair trade continue in U.S. markets; competitive factors, including changes in market penetration, increasing price competition by existing or new foreign and domestic competitors, the introduction of new products by existing and new competitors, and new technology that may impact the way the company’s products are sold or distributed; changes in operating costs, including the effect of changes in th e company’s manufacturing processes, changes in costs associated with varying levels of operations and manufacturing capacity, availability of raw materials and ener gy, the company’s ability to mitigate the impact of fluctuations in raw materials and energy costs and the effectiveness of its surcharge mechanism, changes in the expected costs associated with product warranty claims, changes resulting from inventory management, cost reduction initiatives and different levels of customer demands, the effects of unplanned work stoppages, and changes in the cost of labor and benefits; the success of the company’s operating plans, announced programs, i nitiatives and capital investments (including the jumbo bloom vertical caster and advanced quench-and-temper facility), the ability to integrate acquired companies, the ability of acquired companies to achieve satisfactory operating results, including results being accretive to earnings, and the company’s ability to maintain appropriate relations with unions that represent its associates in certain locations in order to avoid disruptions of business; and changes in worldwide financial markets, including availability of financing and interest rates, which affect the company’s cost of funds and/or ability to raise capital, the company’s pension obligations a nd investment performance, and/or customer demand and the ability of customers to obtain financing to purchase the company’s products or equipment that contain its products, and the amount of any dividend declared by the company’s board of directors on its common shares. Additional risks relating to the company’s business, the industries in which the company operates or the company’s common shares may be described from time to time in the company’s filings with the SEC. All of thes e risk factors are difficult to predict, are subject to material uncertainties that may affect actual results and may be beyond the company’s control. Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results and that the above list should not be considered to be a complete list. Except as required by the federal securities laws, the company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. The unaudited pro forma consolidated financial data in this presentation is subject to assumptions and adjustments described in the company’s registration statement on Form 10. TimkenSteel Corporation’s (“TimkenSteel”) management believes these assumptions and adjustments are reasonable unde r the circumstances . The unaudited pro forma consolidated financial data does not purport to represent what TimkenSteel’s financial position and resul ts of operations actually would have been had the spinoff occurred on the dates indicated, or to project TimkenSteel’s financial performance for any future period following the spinoff. This presentation also includes certain non-GAAP financial measures as defined by SEC rules. A reconciliation of those measures to the most directly comparable GAAP equivalent is contained in the Appendix. Please see discussion of non-GAAP financial measures in the Appendix. 2

Today’s presenters Chris Holding Executive Vice President & Chief Financial Officer Tina Beskid Director, Investor Relations 3

Business overview

TimkenSteel: At a glance Key facts 2014 sales split by product • $1,674 million in 2014 sales Value added solutions (precision machining, supply chain management, • $211 million in 2014 adjusted EBITDA 1 cutting and drilling) 17% • 2014 shipments: 1,094k tons Alloy steel bars (SBQ) • Annual melt capacity of ~2 million tons Seamless 63% mechanical tubing • Headquartered in Canton, Ohio 20% • ~3,000 employees 2014 sales split by business segment 2014 OEM sales split by end market 2 Other 3 10% Rail 4% Passenger car 21% Industrial 11% Energy & distribution Industrial & Machinery 4 mobile 43% 9% 57% Light truck 21% Oil & gas 24% Source: TimkenSteel 1 See Appendix for Adjusted EBITDA reconciliation 2 Excludes distribution sales which were 24% of 2014 sales 3 Other: ≤ 2% each of construction, mining, military/defense, heavy and medium truck, agriculture, metals recycling, power gene ration, marine and aerospace 4 Machinery includes historic intercompany sales to Timken 5

Focused in niche market sectors where we have competitive strength Global finished steel products USA finished steel products Our core product lines Other Asia 15% Special Bar Seamless China 47% Quality Mechanical Other Long EU-28 9% 5% Tubing Products² 1% 26% NAFTA 9% Our home market Flat-Rolled 69% Others¹ 9% Japan 4% Other Europe CIS 4% 3% World: 1,633 mm tons USA: 107 mm tons Source: World Steel Association; American Iron and Steel Institute ¹ Others: Middle East 3.2%, Central & South America 3.3%, Africa 2.0%, Australia & New Zealand 0.4% 2 Other Long Products: Light Shapes, Reinforcing Bars, Merchant Bars, Wire, Pipe & Tubing 6

Emphasis on high-end value-added products capabilities TimkenSteel Applications Bearings Fuel injectors HIGH Gun barrels (SBQ) Crankshafts Tri-Cone bits Percussion bits Energy CRA Performance Production CV joints Quality Value Gears Non TimkenSteel Applications Fasteners Hand tools Leaf springs Shopping carts Table legs LOW Reinforcing bar (Not SBQ) 7

High-quality, reliable steel our customers value Effect of steel cleanness on fatigue performance Cleanness and consistency 0.5 Cleaner 0.4 Product life index 0.3 Cleanness 0.2 0.1 Dirtier 0 Low quality Medium quality High quality TimkenSteel Less Consistency More quality Competitor material DTH Hammer Piston Source: TimkenSteel 8

Providing enhanced capabilities that customers value Advanced Heat Treat Value Add Advanced Heat Treat Small Quantity Advanced Heat Treat Single Thermal Large Quantity Treat Customer value level Value Add Single Thermal Treat Single Small Thermal Treat Quantity Large Hot Roll Quantity Small Quantity Hot Roll Large Quantity Material and service level Source: TimkenSteel 9

Industrial & Mobile segment 2014 sales mix 1 Overview • Mobile: Steel most often used in critical automotive Metals recycling 3% applications where high performance is required • Industrial: Steel used for a variety of industrial applications where performance is critical Industrial  Manufacturing flexibility allows production of 41% Mobile 56% many grades in small quantities • Sales are ~90% contract and ~10% spot pricing • Metals recycling: Full service scrap metal 2014 sales: US$962mm management company recycling ferrous and non- ferrous metals Key customers HHI Ford Honda Nissan Ellwood National Crankshaft Timken CAT Chrysler GM Nexteer Toyota General Dynamics Brenco AJAX 1 Based on full year 2014 Steel segment sales 10