Michelin : 2020 3rd Quarter and 9 Months Sales – Presentation

OCTOBER 22, 2020

SALES AT SEPTEMBER 30, 2020

Nine months 2020: €14.9bn in sales, down 15% at constant exchange rates,

with a turnaround in Q3 (down 5% at constant exchange rates)

• After falling steeply in Q2 due to the health crisis, global tire demand picked up in Q3:
• • PC/LT: demand plunged 17% over the first nine months, with a 6% decline in Q3 reflecting a better-than-expected recovery.
  • Truck: markets ended the first nine months down 14%, with strong OE demand in China in particular limiting the Q3 decline to 6%.
  • Specialties: markets remained in line with H1 trends, with the rebound in Agricultural and 2W offsetting a slowdown in the Mining business, which felt the effects of the health crisis with a lag of a few months.
• Sales for the full nine months were down by 16.8% year-on-year (including a 1.7% decline from the currency effect), reflecting:
• • A 17% decline in volumes, cushioned by a stronger than expected third quarter (down 6.7%). The Automotive and Specialty businesses gained market share, but the Road Transportation business was hurt by an unfavorable geographic mix.
  • A 1.7% improvement in the price-mix, attributable to:
  • • the strength of the MICHELIN brand in a crisis environment and market share gains in the 18"+ segment
    • disciplined price management in response to declines in certain currencies, which offset the negative impact of raw materials-based price indexation clauses
  • A 0.3% net increase from changes in the scope of consolidation (first-time inclusion of Multistrada and Masternaut and deconsolidation of BookaTable)
• Michelin refinanced its syndicated credit line and raised it to €2.5bn. Actual cost will depend on the Group's ability to meet social and environmental targets.
• The Group is revising its guidance for 2020 upwards, taking into consideration new market forecasts and the cost reductions linked to the circumstances.

2	Sales at September 30, 2020 - October 22, 2020

Q3 2020: global demand picked up, particularly in China, but remained relatively weak in the mature regions

PC/LT: -17%

-14	-33	-6
		Q3
Q1
	Q2

	-10	-39	-8
				Q1		Q3
					Q2
	-10	-41	+6
						Q3
				Q1
					Q2
					+4	+9
	-38
					Q2	Q3
3				Q1
Sales at September 30, 2020 - October 22, 2020

	TRUCK: -14%	SPECIALTIES
-19	-16	-6
		Q3
Q1	Q2
-3	-24	-4
Q1		Q3
	Q2
-5	-26	-3
Q1		Q3

Q2

+10 +10

-32

Q2Q3

Q1

Source: Michelin

* Including Central America for OE

Nine-month sales were hard hit by the fall-off in volumes; firm prices and the enhancement of the mix offset unfavorable exchange rate movements

Sales, 9 Months 2020 vs. 9 Months 2019

(in € millions and %)

		-15.1%
17,897	+48	-3,046
	External growth
	Changes in scope
	of consolidation*			15,196
	(+0.3%)		+297	-308	14,888
		Organic growth	Price-mix		Currency effect
		Volumes	(+1.7%)		(-1.7%)
		(-17.0%)	o/w mix +1.3%

9M 20199M 20209M 2020 at constant

exchange rate

* In particular, the inclusion of Multistrada and Masternaut and the deconsolidation of BookaTable

4	Sales at September 30, 2020 - October 22, 2020