Eramet: Combined General Shareholders' Meeting of 26 May 2020

Combined General Shareholders' Meeting

Christel BORIES

Chairman and CEO

26 MAY 2020

Disclaimer

Certain information contained in this presentation including any information on Eramet's plans or future financial or operating performance and any other statements that express management's expectations or estimates of future performance, constitute forward-looking statements. Such statements are based on a number of estimates and assumptions that, while considered reasonable by management at the time, are subject to significant business, economic and competitive uncertainties. Eramet cautions that such statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Eramet to be materially different from the company's estimated future results, performance or achievements expressed or implied by those forward-looking statements.

Past performance information given in this presentation is solely provided for illustrative purposes and is not necessarily a guide to future performance. No representation or warranty is made by any person as to the likelihood of achievement or reasonableness of any forward-looking statements, forecast financial information or other forecast. Nothing contained in this presentation is, or shall be relied upon as, a promise, representation, warranty or guarantee as to the past, present or future performance of Eramet.

Nothing in this presentation should be construed as either an offer to sell or a solicitation to buy or sell securities nor shall there be any offer or sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful under the securities laws of any such jurisdiction.

2 Combined General Shareholders' Meeting - 26 May 2020

Summary

Introduction

1 - 2019 Financial results

2 - Q1 2020 - Point to date

3 - Strategic transformation

Conclusion and outlook

3 Combined General Shareholders' Meeting - 26 May 2020

Despite the environment, Eramet is delivering on its strategic roadmap

Operational performance

CSR

achievements

Strategic roadmap

Mining operational records in 2019

Continuing record production in Manganese ore

• +15% over 2 yrs (4.8 Mt in 2019 vs 4.1 Mt in 2017) Ongoing increase in nickel ore exports
• +80% over 2 yrs (1.6 Mwmt vs 0.9 Mwmt)

Constant progress in operating performance in Mineral Sands

New SLN Business model: an ore export strategy bearing fruit

Cash-costreduction in both H2 2019 (-5% vs H1), and Q1 2020 (-8% vs Q4 2019)

Progress on the CSR roadmap

High 2019 performance index at 112 pts in 2019, i.e. 12 pts > 2019 target 50% decrease in accident frequency over 2018-2019

New strategic milestones

Weda Bay Nickel: start of NPI production in April 2020

Continuing manganese ore organic growth in Gabon

Focus on the upstream mineral sands business after the announcement of an agreement for the sale of TiZir's Norwegian plant, subject to certain conditions

Lithium project currently mothballed

4 Combined General Shareholders' Meeting - 26 May 2020

Shareholding

Historic and stable shareholders

Shareholding at 31/12/2019

	32,1%
US institutional	6,4%
shareholders	Other float
UK institutional	1,0%	32.1%
shareholders
Other institutional	7,4%
shareholders
French institutional	4,0%
shareholders
Individual
shareholders/	11,6%
legal persons
Treasury shares
Others	1,0%	0,7%
		BRGM**
	2019

1.3%

Duval Family : SORAME + CEIR

36.9%

Number of

shares issued

26,636,000

APE 25.6%

STCPI*

4.0%

6 Combined General Shareholders' Meeting - 26 May 2020

• STCPI (Société Territoriale Calédonienne de Participation Industrielle): entity owned by the New Caledonian provinces
• BRGM (Bureau de Recherches Géologiques et Minières): the French Geological Survey Office

1

2019 Financial results

EBITDA showing solid operating performance, in a depressed price environment in 2019

Sales €3,671m

• -4%vs 2018

EBITDA €630m

• -25%vs 2018

COI €341m

(Current operating income)

Net debt €1,207m (excluding IFRS 16 impact)

High Performance	Erasteel	Mining and Metals
Alloys Division	6%	Division
23%		77%

Aubert & Duval 17%

Mineral Sands	€3,671m
BU	Manganese BU

8%	48%
	Nickel BU
	21%

Net income - Group share

€(184)m

Gearing174%

ROCE212%

8 Combined General Shareholders' Meeting - 26 May 2020

1. Net debt-to-equity ratio, excluding IFRS 16 impact
2. COI divided by capital employed for year N-1

A financial performance adversely impacted by manganese prices and non-recurring items

Deteriorated manganese price environment

-21% on average for manganese ore1 prices

-7% on average for refined manganese alloys'1 prices

-5% on average for standard manganese alloys'1 prices

A&D one-offs

Delivery and sales hampered by logistics issue, following quality review including in-depthrestructuring of former production and management routines

Exceptional payments to the Gabonese state

Advance payment of 2019 income tax and tax adjustment

-€268m

EBITDA impact

vs 2018

-€49m

EBITDA impact

-€160m

Net debt cash-outflows

-€114m

Net debt cash-outflows

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1 CRU index: manganese ore CIF China 44% ; MC FeMn (Europe) ; SiMn (Europe)

Key financial figures

€m	2019	2018
Sales	3,671	3,825
EBITDA	630	843
% Sales	17%	22%
Current operating income	341	581
% Sales	9%	15%
Net income - Group share	(184)	53
Net debt	1,304	717
Net debt, excl. IFRS 16 non cash impact	1,207	717
Gearing (Net debt-to-equity ratio), excl. IFRS 16 non cash impact	74%	38%
ROCE (COI / capital employed1 for previous financial year)	12%	22%

The data presented and commented on is adjusted data from Group Reporting, in which joint ventures are accounted for using proportionate consolidation until end-2018. The reconciliation with the published financial statements is presented in the appendices.

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1 Sum of shareholders' equity, net debt, provisions for site rehabilitation, restructuring and other social risks, less financial fixed assets, excluding Weda Bay Nickel capital employed

Net income-Group share at €(184)m, penalised by €(114)m of non- recurring items at High Performance Alloys Division and exceptionally high level of taxes

€m	2019	2018
Sales	3,671	3,825

Current operating income	1		341	581
Other operating income and expenses	1	(118)	(116)
Financial result			(134)	(95)
Pre-tax result 2			89	371
Share in income from associated companies	(7)	(3)
Income tax			(227)	(241)
Net income			(145)	126
o/w Minority interests' share			39	73
Net income - Group share			(184)	53

1

HP Alloys Division: €(114)m impact of non- recurring items, o/w €(49)m EBITDA, €(64)m of other operating expenses

2

Income tax includes €(147)m of taxes due to Gabon, o/w Comilog 2019 Income tax (€90m)

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Continued high liquidity at €2.3bn at 2019 end-year

Credit lines fully withdrawn as a precaution as of 31st March 2020

Revolving credit facility ("RCF")

• €981m RCF maturing 2024

Term loan:

• €350m loan granted in December with a 2- year maturity and an option to extend to January 2024 at Eramet hand
• Intended for general purposes and investment

European Investment Bank ("EIB") financing:

• €120m loan maturing in 2030
• Intended to support R&D expenditure, modernisation and digital transformation

Group financial liquidity (€m)

3,000	2,806
2,500		2,468	2,299
2,000	1,825		848
	1,367
1,500
1,000			981
500	981	981
			350
0		120	120
	31/12/2017	31/12/2018	31/12/2019
	pro forma*

Available cash

Withdrawn line at 31/03/20: Revolving Credit Facility ("RCF")

Withdrawn line at 31/03/20 : Term Loan

Withdrawn line at 31/03/20 : European Investment Bank ("EIB") financing

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• Pro forma of the repayment of the €250m RCF drawdown on 18 January 2018 and post-extension to 2023 of the RCF signed on 13 February 2018

No major debt maturity within the next 3 years

Group gross debt at €2,055m at 31 December 2019 (excl. IFRS 16 non cash items)

Extension of debt maturity in November 2019: repurchase of 2020 bonds for €227m and issuance of new bonds for €300m due May 2025

Average maturity of Group's 3-year debt; c. 90% at a fixed rate

685

15

Debt maturity at 31 December 2019 (€m)

Commercial papers, banks & operating debts

497		Eramet bonds

TiZir bond

500

French State Loan to SLN

231					317
		280
				17
		78
	169
233	37				300
	100	202		170					68
		17		6	6	10
33	32				68
	17			6	6	10
2020	2021	2022	2023	2024	2025	2026	2027	2028	>2028

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Strenghtened and accelerated cash control measures in 2020

Optimising cash flow and closely monitoring net debt level

High level of cash maintained, all credit lines drawn down as a precaution in Q1 2020

63%1 gearing (as calculated for covenant purposes) at 2019 year-end (74%, excl. IFRS 16 only)

2020 strict cash control plan

Cut in capex: modularity and flexibility; lithium project in Argentina currently mothballed

Tight control of opex and working capital: dedicated committee strictly and regularly monitoring all operating expenses

Partial unemployment arrangements for several sites in France in the context of the pandemic

No dividend to be paid in 2020

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1 Excl. IFRS 16 impact, excl. French state loan to SLN

2

Q1 2020 - Point to date

Eramet fully committed to face the Covid-19 health crisis

Safety and security: the Group's top priority

Daily mobilization of ExCom from the beginning of the crisis to take all the required sanitary and

operational measures

Strict health protocols rolled out on all sites; stringent guidelines applied to comply with health regulations

No serious case in Eramet's perimeter and further strong decline in accident frequency rate at 4.11 in Q1 2020: -24% vs FY 2019

Limited impact of Covid-19 pandemic in Q1 2020

Mining and Metals Division

• Operations at normal rate for all mines and plants with production and sales volumes in line with expectations
• Still very difficult to plan ahead for developments of the health crisis and customers' business levels

High-Performance Alloys Division

• Aubert & Duval (A&D): operating rate of c. 65% to date due to aeronautics orders' decline
• Erasteel: production contrasted, strongly affected in the automotive market
• Worsening outlook for the aeronautic sector

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1 TRIR (total recordable injury rate) = number of lost time and recordable injury accidents for 1 million hours worked (employees and subcontractors)

Covid-19: Implementation of an exceptional solidarity plan

Exceptional allocation: €1.5m	2/3		1/3
Group treasury
Contributions of Group executives:	Donations in kind		Financial support of
and equipment to		actors mobilized for the
CEO, Comex, Board members	communities		communities

Community investment expenditure: €8.5m

Strengthening actions in the health sector

Economic and social support initiatives for communities strengthened

Numerous solidarity actions already carried out (medical equipment, food and basic necessities donations…)

Prevent the spread and support the communities:

€10m to support projects in 2020

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Q1 2020 sales down 11%, affected by the sharp decline in material prices…

High Performance	Erasteel
Alloys Division	5%
25%

Mining and Metals

Division

75%

Aubert & Duval 20%

Mineral Sands

€774 m

Manganese BU

BU	46%
9%
	Nickel BU
	20%

Unfavourable price environment hitting the Metals & Mining division's turnover

-34% in manganese ore prices (CIF China 44%) in Q1 2020 yoy; steeper price decline for Eramet (-41%), as January & February sales were signed based on lower spot prices in Dec. 2019

Sharp decline in ferronickel prices, at a large discount to the LME reflecting the fall in demand for stainless steel

Conversely, average price of nickel seaborne ore (CIF China 1.8%) up +32% yoy to USD 67.7/wmt, following the Indonesian ban, effective as of 1st January 2020

Strong decline in Erasteel sales

Erasteel's sales down 34% to €40m, due to steeper slowdown in the automotive sector, worsened by the health crisis and declining raw material prices

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…but supported by new operational records for the Mining & Metals division

Mining and Metals division

New Q1 operational records in Q1 2020

• 1.3 Mt in produced manganese ore volumes (+28% vs. Q1 2019)
• 918 kwmt in produced nickel ore volumes (+5%)
• 331 kwmt in nickel ore exports (+41%)
• OEE1 up +12% for mineral sands production

Q1 2020 production volumes sold in full

High Performance Alloys division

Q1 aeronautical sales up 3% to €115m, owing the low comparison basis in Q1 2019, despite lower volumes of some aerospace programs ; sales up in land-based turbine, energy and defence

Contrasted production at Erasteel: Swedish sites' effective operations, thanks to high-speed steels made using powder metallurgy techniques. Weakness in France.

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1 OEE: Overall Equipment Efficiency, reflects the intensity of mining production (real production/maximum theoretical production)

3

Strategic transformation

1st metal tapping at Weda Bay

Nickel's NPI plant

Continuing Group strategic transformation : increasing cash generation and portfolio diversification

1

FIX / REPOSITION

our least performing assets

Nickel

• SLN new business model: decisive breakthroughs achieved
• Sandouville : recovery in progress

High Performance Alloys

• Restructuring to be redefined given the scale of the crisis in the aeronautics sector following the pandemic

2 GROW

in our attractive businesses

Manganese ore

• Continued growth in volumes in Gabon, based on a modular approach and supported by dry processing

Weda Bay Nickel (Indonesia)

• Start of mining operations in Q4 2019
• Ongoing NPI plant ramp-up

Mineral sands

• Focusing on the high growth potential mine in Senegal : continuous improvement of operational performance and debottlenecking options under review
• Agreement signed for the sale of the Norwegian plant in May
• Cameroon: exploration permits granted in rutile

3

EXPAND our portfolio in metals for the energy transition

Lithium:

• Project in Argentina currently mothballed
• Pilot plant on site confirming highest industry yield in real conditions

Nickel and cobalt salts

• Study of Weda Bay diversification towards products for EV batteries

Li-ion batteries' recycling

• R&D programme

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Agreement for the sale of TiZir's Norwegian plant, announced on May 14th

STRENGTHENING OF ERAMET'S BALANCE SHEET		CONTINUED DEVELOPMENT OF THE UPSTREAM BUSINESS
		IN MINERAL SANDS

Sale agreement signed on mid-May with Tronox, one of the main producers of pigments and titanium dioxide

Realization of the full value of TiZir's

Norwegian plant

100%	EBITDA
of TTI shares	multiple
sold	~ 8x1
Sale price	LT supply
contract to
300 M$	TTI
	(ilmenite)

Operation subject to the satisfaction of certain conditions including regulatory approvals

Strengthening of the Group's balance sheet with

significant debt reduction

Control of GCO by Eramet maintained2

A world-class deposit, located in Senegal, one of

the most stable countries in Africa:

• More than 50 years of resources (35 Mt of mineral sands3)
• 735 kt of mineral sands produced in 2019 : principally zircon and ilmenite

Integrated processing and logistics facilities

CSR : a model in terms of relationship with host communities

Development opportunities on the mining business, in line with the Group's strategy:

• Continued improvement of operational performance
• Debottlenecking options under review

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1. TTI's EBITDA calculated on the basis of exchange rates of May 12th 2020
2. At 90%, 10% being hold by the Senegalese State
3. Heavy mineral concentrates

Lithium project in Argentina: currently mothballed

HIGHLY VALUE-ACCRETIVE PROJECT

Long life low cost and scalable project, c.10 Mt

LCE1 drainable resources, c.50 years of resources

Battery grade lithium carbonate production (24 kt LCE1)

1st quartile cash-cost ($3.5k/t) amongst the best in the industry

Pilot plant on site (operating in real conditions since December 2019) to continue its activity in order to finish collecting the process results

Eramet lithium yield vs competition

90%

	70-75%
Evaporation process

50-55%50-55%

Comp. 1

Comp. 2

Comp. 3

Eramet

STATUS UPDATE: PROJECT MOTHBALLED

April 2020: decision not to engage the construction of the lithium production plant

• Considerable uncertainty in the global economy due to current sanitary crisis
• In such context, cash preservation measures to be strengthened and accelerated

As a result, in 2020:

• Expense of c. €150m, including an asset impairment charge
• Cash outflows of c. €90m

All measures taken to allow a restart in the best conditions when possible

(Comp: competitor)

Direct extraction process

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1 LCE = Lithium Carbonate Equivalent

A leap in corporate social responsibility (CSR) in 2019

Increase in the CSR Performance index*

Improvement of non-financial rating

112 representing +12 points compared with

2019 target

80%

of industrial sites	87%
ISO14001 certified
	of purchased electricity
1.2	produced with carbon-
free footprint
Ratio of
rehabilitated/cleared
areas

-35%	€20m
accidents	Invested in the
(employees, temps and
comunities' benefit **
subcontractors' FR2)

Vigeo Eiris rating's progression in

assessed ESG domains

• The CSR Performance index measures the annual progress of Eramet's 2018-2023 CSR programme
• Expenditures for local populations and sponsorship, including this year's

24 Combined General Shareholders' Meeting - 26 May 2020 exceptional contribution of Comilogto the financing of road rehabilitation in Moanda (€5m)

Conclusion and outlook

Committed to delivering our roadmap in 2020, despite the uncertainties related to the pandemic

Very low visibility for quarters ahead

Very tight operational management to face the crisis

Limited impact in Q1 2020 but extent and length of the pandemic still unknown

Decrease in demand and one-off restricted supply resulting in considerable unstable market equilibriums in the Mining & Metals division

Reduction in production rates recently announced in the aerospace sector as well as in the automotive's to have a deep and lasting impact on the High Performances Alloys division

Strict cash control

Implementation of 2020 cash control plan and strict control over net debt

Lithium project mothballed

Sale of TiZir's Norwegian plant for $300m, subject to conditions

New milestones for the Group's strategic roadmap

Ramp-upof Weda Bay's mining and metallurgical operations in 2020

Sustained growth in Manganese: strengthening of our leadership market positions

Suspension of the 2020 production and EBITDA guidance,

given the lack of visibility over the coming months

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Weda Bay Nickel mines, island of

Halmahera, Indonesia