November 5th, 2019

CONFERENCE CALL DETAILS

LIVE EVENT:

The Company will host a conference call for investors and analysts today at 18:30 (Spanish time).

Please find below conference call telephone numbers:

Spain: +34 911140101

France: +33 170710159

UK: +44 2071943759

US: +1 6467224916

Acces Code::17964390#

Access to the live event:

https://event.on24.com/wcc/r/2104989-1/0049126FD2CDFC587E669CD6A80E3B0D?partnerref=rss-events

WEBCAST REPLAY:

A recording of the conference call will be available for 30 days on the following telephone numbers:

Replay dial number:

Spain: +34 910387491

France: +33 (0)170710160

UK: +44 2033645147

US: +1 (646) 722-4969

Access code: 418878556#

Access to the Webcast Replay:

https://event.on24.com/wcc/r/2104989-1/0049126FD2CDFC587E669CD6A80E3B0D?partnerref=rss-events

2

This presentation has been produced by Indra for the sole purpose expressed therein. Therefore, neither this presentation nor any of the information contained herein constitutes an offer sale or exchange of securities, invitation to purchase or sale shares of the Company or any advice or recommendation with respect to such securities.

Its content is purely for information purposes and the statement it contains may reflect certain forward-looking statements, expectations and forecasts about the Company at the time of its elaboration. These expectations and forecasts are not in themselves guarantees of future performance as they are subject to risks, uncertainties and other important factors beyond the control of the Company that could result in final results materially differing from those contained in these statements. The Company does not assume any obligation or liability in connection with the accuracy of the mentioned estimations and is not obliged to update or revise them.

This document contains information that has not been audited. In this sense, this information is subject to, and must be read in conjunction with, all other publicly available information.

This disclaimer should be taken into consideration by all the individuals or entities to whom this document is targeted and by those who consider that they have to make decisions or issue opinions related to securities issued by Indra.

3

  1. 9M19 Backlog +9% and Order Intake +7%, both above revenue growth (+5%)
  2. Revenues up +6% in local currency in 9M19 , both T&D and Minsait posted growth. America stood out (+15% in local currency)
  3. EBITDA up +22% in 9M19 (+7% excluding the IFRS 16 impact)
  4. EBIT grew +10% in 9M19, pushed by Minsait (3.1% EBIT margin), despite the lower contribution from the Election Business
  5. Net profit improved +18% in 9M19
  6. FCF almost flat in 3Q19 (€-1m) vs (+€15m) in 3Q18, backed by working capital normalization in the quarter
  7. Indra maintains its 2019 guidance
  8. Indra, nominated as national industrial coordinator of the FCAS (Future Combat Air System) Program

4

9M19 Sales Growth

3Q19 Sales Growth

Reported

+5%

Reported

+4%

Local Currency

+6%

Local Currency

+4%

Organic1

+5%

Organic1

+4%

€m

€m

1. Excluding the ACS acquisition and the FX impact

5

Order Intake (€m)

Local Currency / Reported

2,632

2,466

+7% / +7%

1,245 47%

50%1,233

+1%

601

23%

22%

547

+11% / +10%

15%

366

455

17%

+24% / +24%

13%

319

13%

+3% / +4%

331

9M18

9M19

Revenues (€m)

Local Currency /Reported

2,288

2,174

+6% / +5%

Spain

1,147

51%

1,112

+3%

50%

America

20%

431

+15% / +12%

484

21%

Europe

17%

363

+7%

/ +7%

390

17%

AMEA

12%

268

-1%

/ -1%

266

12%

9M18

9M19

6

Indra backlog (€m)

+9%4,378

4,032

9M189M19

Indra backlog/revs LTM

1.31

+4%

1.36

9M18

9M19

T&D backlog (€m)

2,720 +4%2,820

9M189M19

T&D backlog/revs LTM

2.37-3%2.30

9M18

9M19

Minsait backlog (€m)

1,312 +19%1,558

9M189M19

Minsait backlog/revs LTM

0.68 +14%0.78

9M189M19

7

49,082

5,375

1,900

Totalworkforce

43,707

-43

Overheads & Others

1,943

7,327

T&D

6,900

427

4,991

39,855

Minsait

34,864

o/w >3,000 BPO

o/w >700 Digital

o/w >2,500 in

BPO Latam

Services

dic.-18

sep.-19

2018

9M19

8

9M19 EBITDA and Margin

3Q19 EBITDA and Margin

9.7%

10.9%

8.4%

9.4%

9M19 EBIT and Margin3Q19 EBIT and Margin

5.3%

5.5%

6.5%

6.0%

9

Guidance 2019

9M19

Revenue growth

Low single digit

+6%

(in constant currency)

EBIT growth

>10%

+10%

(in absolute terms)

FCF before NWC*

>100 m€

€93m

*Excluding IFRS 16 impact

10

T&D

9M19 Order Intake (€m)

9M19 Revenues (€m)

3Q19 Revenues (€m)

Local Currency / Reported

Local Currency / Reported

Local Currency / Reported

902

907

+0% / +1%

262

814

259

+2% / +2%

777

354

+5% / +5%

39%

+25% / +25%

442

49%

45%

117

118

45%

-0% /-0%

389

48%

50%

389

+0% / +0%

61%

547

465

52%

55% 141

145

55%

+3% / +3%

-15% /-15%

426

51%

50%

388

+10% / +10%

9M18

9M19

9M18

9M19

3Q18

3Q19

Defence & Security

Transport & Traffic

11

T&D

9M19 EBITDA and Margin

3Q19 EBITDA and Margin

16.2%

16.7%

14.0%

15.8%

12.8%

9M19 EBIT and Margin

3Q19 EBIT and Margin

10.0%

12.6%

11.4%

12

9M19 Order Intake (€m)

9M19 Revenues (€m)

Local Currency / Reported

Local Currency / Reported

1,564

1,725

+11% / +10%

1,473

491

28%

1,396

+6% / +6%

32%

507

-2% /-3%

464

32%

30%

417

+

12% / +11%

574

33%

-5% /-5%

39%

602

34%

481

510

35%

+6% / +6%

421

24%

18%

+52% / +52%

23%

313

21%

277

321

-2% /-2%

239

14%

11%

186

177

13%

178

13%

+37% / +35%

+6% / +5%

9M18

9M19

9M18

9M19

Energy & Industry

Financial Services

PPAA & Healthcare

Telecom & Media

MINSAIT

3Q19 Revenues (€m)

Local Currency / Reported

479

452

+6% / +6%

30%

+

11% / +11%

149

31%

134

34%

+8% / +8%

34%

152

165

24%

21%

109

-7% /-7%

102

13%

13%

57

+11% / +10%

63

3Q18

3Q19

13

MINSAIT

9M19 Operating Margin1

3Q19 Operating Margin1

4.6%-0.1pp 4.5%

64

66

9M18 Op. Margin (€m)

9M19 Op. Margin (€m)

9M19 EBIT and Margin

3.1%

+1.9pp

1.1%

45

16

9M18 EBIT (€m)

9M19 EBIT (€m)

7.1%

-1.8pp

5.3%

32

25

Significant

lower

3Q18 Op. Margin (€m)

3Q19 Op. Margin (€m)

contribution

from the

3Q19 EBIT and Margin

Election

Business

3.8%

2.2%

+1.6pp

10

18

3Q18 EBIT (€m)

3Q19 EBIT (€m)

1. EBIT before Other Operating Income & Expenses, which includes: staff reorganization, integration and acquisition costs, fines, amortization of intangible assets (PPA from acquisitions) and equity based compensation.

14

Quarterly FCF (€m)

FY15 €-50m

137

-23

-79-85

1Q15

2Q15

3Q15

4Q15

FY16 €184m

140

47

2

-5

1Q16 2Q16 3Q16 4Q16

FY18 €168m

9M19 €-238m

FY17 €186m

213

142

75

15

-5

-26

-6

-1

-55

-108

-129

1Q17

2Q17

3Q17

4Q17

1Q18

2Q18

3Q18

4Q18

1Q19

2Q19

3Q19

Accumulated FCF LTM (€m)

163181 184132 104184 186 185 1579616866

76

-9-25

-114

-50

-136

1H15

9M15

FY15

1Q16

1H16

9M16

FY16

1Q17

1H17

9M17

FY17

1Q18

1H18

9M18

FY18

1Q19

1S19

9M19

FCF before WC* (€m)

9393

0%

9M18

9M19*Excluding IFRS 16 impact

15

Net Debt Bridge - Cash Flow (€m)

FCF = €-238m

o/w -26 M€ IFRS 16

Working Capital Normalization in 3Q: €-38m(1)in 3Q19 vs €-29m in 3Q18.

o/w +26 M€ IFRS 16

Main Working Capital Items

Shorter term items (likely to

reverse by YE)

• Seasonality of concentration of project milestones

  • Anticipation of cash collections from 2020
  • Cash collections linked to delayed payments

Medium to longer term items

  • Pending cash collections from delayed payments
  • Financing of sales growth
  • Inventories associated to IFRS 15
  • Higher inventories linked to improve Time To Market
  1. €-43including IFRS 16 (€-9m impact)

16

Net Working Capital (DoS)

Inventory

Accounts Reveivable

Accounts payable

47

+7

37

+11

40

37

36

46

+9

+10

+4

+13

-70

-74

-82

2018

9M19

9M18

17

837

Net Debt (€m)

(173)

730

Net Debt

(Factoring)1

700

680

686

(187)

666

(187)

(187)

(187)

(187)

3Q15 4Q15 3Q16 3Q17 3Q18 3Q19

6.6x

Net Debt/EBITDA LTM (Times)

5.4x

3.1x

2.7x

2.5x

2.4xND/ EBITDA LTM

Ex IFRS 16

3Q15 4Q15

3Q16

3Q17

3Q18

3Q191. Non-recourse factoring

18

Gross and Net Debt Structure

9M19 % total 2018 % total

Corporate Bonds

Convertible Bonds

R+D Loans

Bank Loans

EIB1Loans

€1,486m

354

247

90

715

80

€756m

569

187

€730m

Factoring

730

L/T Debt

1,437

97%

1,359

97%

S/T Debt

49

3%

42

3%

Gross Debt

1,486

100%

1,401

100%

Cost of Gross Debt

1.8%

2.0%

Cash & Others

756

n.m.

918

n.m.

Net Debt

730

n.m.

483

n.m.

Cost of Net Debt

2.7%

3.2%

Gross Debt

Cash & Cash

Net Debt

Equivalents

9M18

2018

Average life (years)

3,5

4,0

Other available credit facilities: €190m

Gross Debt

Maturity Profile

775

335

320

12

43

2019

2020

2021

2022

2023 and

2

1. European Investment Bank . 2. Including €246m Convertible Bond with 2023 maturity and €296m Corporate Bond with 2024 maturity

beyond

19

Investor Relations irindra@indra.es

Avenida de Bruselas, 35 28108 Alcobendas Madrid Spain

T +34 91 480 98 00 www.indracompany.com

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Disclaimer

Indra Sistemas SA published this content on 05 November 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 November 2019 23:24:01 UTC