OSRAM pushes on company transformation Q3 FY14 Management - PowerPoint PPT Presentation

www.osram-licht.ag OSRAM pushes on company transformation Q3 FY14 Management Presentation (preliminary figures) OSRAM Licht AG July 29, 2014

Safe Harbor Statement This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. OSRAM Licht AG has based these forward-looking statements on its views and assumptions with respect to future events and financial performance. Actual financial performance could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and OSRAM Licht AG does not undertake any duty to update the forward- looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. 2 2 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

Group highlights Q3 FY14 Modest topline decline – LLS, SP and OS stay growth engines • € 1,203m revenue (-1% comp.) • 8.6% Adj. EBITA margin 1) (+120bps y-o-y) OSRAM Push Wave 1 on track; targets for Wave 2 defined • € 118m Wave 1 benefits in Q3 • 8th plant closed, remaining 3 plants in Americas for closure in Q4 FY14 announced, in implementation and on track • Additional € 260m cum. gross savings 2) from Wave 2 until FY17 Business Units CLB and LLS implemented, management fully in control • Q3 FY14: profit & loss reporting • Q4 FY14: full segment reporting Outlook FY14 confirmed • Revenue expected on the last year's level, at best a modest revenue increase, on a comparable basis • We expect an adjusted 1) EBITA margin of more than 8% in FY14 • Profitability: EBITA margin of >8% as average over the cycle from FY15 3) Adjusted for “Special items” - "Special items” in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods 1) 2) Expected cum. gross savings based on Wave 2 restructuring part Depending on the implementation speed of the measures and the restructuring costs’ effect on earnings, the reported EBITA mar gin could be below this average value in FY15 3) 3 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

Segment highlights Q3 FY14 LED Lamps & Systems (LLS) • Sharp growth rate of 68% (comparable) • Break-even target LEDr lamps in Q1 FY15 on track Classic Lamps & Ballasts (CLB) • Market shares in EMEA and Americas kept stable • Pricing strategy with good results in selected markets Luminaires & Solutions (LS) • Repositioning LS shows first effects – trough in topline in Q2 passed • LS in line with plan to break-even in FY15 • Majority of Services lay-offs completed Specialty Lighting (SP) • Strong growth in Automotive; Display/Optics growth trend continues • OSRAM headlamp laser technology introduced with BMW / Audi Opto Semiconductors (OS) • 9 quarters of growth (yoy) in a row, 5% growth in Q3 FY14 despite tough comps • High operational performance – driven by product mix and OSRAM Push • Successful ramp-up of back-end facility Wuxi, start of first deliveries to customers 4 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

Split of LC to address the need of different business models CLB - Classic Lamps & Ballasts LLS - LED Lamps & Systems Our focus / products Our focus / products  LED Lamps, Spots and Tubes (ex LP)  Thermal, CFLi, LPD, HPD  Light Management Systems  Outdoor Systems /  Traditional ECGs (ex LE) Indoor SSL-ECG Market (mid-term outlook) Market (mid-term outlook)  Continuous strong decline  Ongoing double-digit growth prospects Our Goals Our Goals  Keep EBITA positive, pay its restructuring and  Continue double digit growth return cash  Reach break even (LEDr lamps in Q1 FY15 on track) Key measures Key measures OSRAM Push  OSRAM Operations Project  Benefitting from OSRAM SG&A project  OSRAM SG&A Project  Innovation through efficient R&D, roadmapping and platform concept  GI Sales Streamlining  4-Pillar strategy for manufacturing, purchasing,  Global Shared Services & Process Excellence Quality & Supply Chain  Lean Headquarters (incl. logistics) 5 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

OSRAM Push Wave 1 continues to deliver on plan OSRAM Push: Overall, comprehensive, continuous performance improvement program OSRAM Push Wave 1 execution track record EBITA Margin: As of Q1-Q3 >8% as average FY 13 cum. Progress Target over the cycle Transformation costs ( € m) 94% 498 64 ~ 600 (FY12 – 14) Plant reductions 7 1 73% 11 (FY12 – 14) Headcount reduction (‘000) 6.6 2) 1.4 c.8.7 92% (FY12 – 14) OSRAM Push gross 63% savings, cum. ( € m) 433 328 c.1,200 (FY13 – 15) OSRAM Push: Wave 2 initiated OSRAM Push Wave 1 targets:  Cum. gross savings of € 1.2bn by FY15 unchanged  Headcount reduction of 8,700 by FY14 unchanged  Reduction of manufacturing sites unchanged  OPEX targets unchanged:  SG&A 1) : Reduce by ~8-10% by FY14 vs. FY12  R&D: Keep absolute terms flat until FY14 vs. FY12 1) w/o logistics costs 2) Including impact of Tangerang (closure of production) Cum. Q4 FY13 Q1 FY14 Q2 FY14 Q3 FY14 6 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

OSRAM Push Wave 2: restructuring part adapted to accelerated traditional GI market decline FY 2012 - 2015 FY 2015 - 2017 2 nd Details to wave 1 st come in Q4 wave GI Sales Streamlining / Global Shared Services Transformation : SG&A ~ € 1.2bn 2) & process excellence / Lean HQs ~ € 0.26bn 2) € 0.45bn 1) ~ € 0.6bn 1) Manufacturing footprint / Transformation: ~ € 0.2bn 2) Transformation : Operations continued - Operations Adapt to market situation Details to New product platforms / Organic growth Organic growth continued come in Q4 Sales share of new products ~ € 1.0bn 2) Operational Purchasing optimization / Operational Details to continued performance Productivity improvements come in Q4 performance Key targets Wave 2 Key data Wave 2 (restructuring part only) Make the whole company leaner and more responsive Cum. expected gross savings of ~ € 0.260bn, FY15 - FY17 Get closer to the customer (Delayer) Headcount 3) reduction of ~ 7.800, FY15 - FY17 • Thereof ~ 1.700 within Germany Clear profit & loss and strengthen entrepreneurship of • Thereof ~ 1.900 non-manufacturing segments (Dematrix) Get affordable cost & right- sized “back - pack” Exp. transformation costs of ~ € 0.450bn, FY15 - FY17 1) Gross expense 2) Gross savings 3) Full-time equivalent 7 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014

Modest revenue decline, Ongoing strong growth in SSL Group ( € m) Revenue development 1) Comments Q3 y-o-y Quarterly revenue  SSL share now 38%, up from 31% in the past year 1,332 1,326 1,278 1,278 1,203  LLS sales with 68% comparable growth  SP again with double digit comp. growth; OS Revenue (in € m) shows moderate comp. growth on strong prior 4 2 year quarter 2 Comp. 1 growth (%)  As communicated, decline of CLB business -1 accelerated (-14% comp. y-o-y) Q3 Q4 Q1 Q2 Q3  Moderate revenue decline in Americas due to FY13 FY13 FY14 FY14 FY14 Nom. (3) (2) (2) (3) (6) restructuring of Services Growth (%) Revenue by Segment 2) Q3 Revenue by Region Q3 Opto Semiconductors Americas Classic Lamps & Ballasts comp. 5% nom. 2% 22% 32% 33% comp. (14)% nom. (19)% EMEA nom. (11)% 43% comp. (4)% nom. 0% 8% Specialty Lighting 29% 8% comp. 2% LED Lamps & Systems 25% comp. 10% nom. 5% comp. 68% nom. 60% APAC Luminaires & Solutions nom. (8)% comp. (13)% nom. (16)% comp. (2)% 1) nom. (nominal growth) / comp. (comparable growth), adjusted for FX and portfolio effects 2) based on sum of Segments ´ revenue, w/o considering corp. items & consolidation 8 Management presentation Q3 FY14 (preliminary figures) | July 29, 2014