OSRAM Licht : Earnings Release Q320

www.osram.com

Third quarter dominated by active crisis management

Q3 FY20 Earnings Release (unaudited figures)

OSRAM Licht AG | July 29, 2020

Light is OSRAM

Disclaimer

This presentation as well as other reports, presentations, materials delivered to shareholders and press releases 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. In addition, our representatives may from time to time make oral forward-looking statements. 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 current views and expectations and on certain assumptions of which many are beyond OSRAM Licht AG's control. These are subject to a number of risks, uncertainties and factors, including, but not limited to those described in disclosures, in particular in the sub-chapter Risks in the Annual Report. 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.

This presentation includes references to non-IFRS financial measures, including, but not limited to: FCF, EBITDA, EBITDA margin, capital expenditure, capital expenditure as percentage of revenue, net financial debt and net working capital. We have provided these measures and other information in this presentation because we believe they provide investors with additional useful information to assess our performance. Our use of these supplemental financial measures may vary from others in our industry and should not be considered in isolation or as an alternative to our results as reported under IFRS.

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 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

Safeguarding profit and cash flow

Statement from the CEO

Q3 FY20 summary:

• Revenue of €606m
  (€-244m /-29.4% comp. vs. prior year)
• EBITDA (adj.) of €-27m /-4.5%
• FCF at €-7m thanks to active working capital management

"Thanks to the early and determined reaction, we were able to contain the impact of COVID-19 on profit and cash flow. I am especially pleased that the operating cash burn was negligible - despite a sequential revenue decline of more than 200 million euros. This is a true testimony to OSRAM's vigor and resilience.

Fiscal Q3 marked the low point in terms of revenue development. We will continue our strong crisis management while being on the lookout for business opportunities in the coming upswing.

On July 9, ams completed the acquisition of a majority share of OSRAM Licht AG following successful antitrust reviews. This is an important cornerstone on our way to creating a global leader in optical solutions."

3 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

Good cash protection despite 30% revenue decline

Revenue (€m) / comp. growth

			-29.4%				Demand drop
						across all business
	850
		606		units, low point
					predominantly in
							April/May
	Q3/19		Q3/20

Free cash flow (€m)

			-98				Limited cash burn
	91					thanks to NWC
								management and
								CapEx discipline
					-7
	Q3/19	Q3/20

EBITDA adj. (€m) / margin

			-85				Profit impact
	58
					mitigated by
	6.8%
					COVID-19
							measures
				-4.5%
				-27
	Q3/19		Q3/20

Comments:

• 20 to 35% comp. revenue decline across business units
• Toughest impact in cinema/entertainment; industrial and general illumination businesses with lowest effect
• Only modest profit drop-through, supported by performance measures
• Early focus on cash management is paying off

4 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

Economic impact from COVID-19 possibly deeper than 2008/2009 - cautious optimism for continued recovery

	OECD Leading Indicator1)
Global	101			OECD Composite Leading Indicator
Economics	100					Calendar months
	99
	98
	97
	96		Low point
		February 2009:
	95			95.8
	94
	93
	01/18 04/18	07/18	10/18	01/19 04/19	07/19	10/19	01/20	04/20	07/20

Global Manufacturing PMI2)

56		J.P. Morgan Purchasing Manager Index
54						Calendar months
52
50
48
46
44
42
40
38
01/18 04/18	07/18	10/18	01/19	04/19	07/19	10/19	01/20	04/20	07/20

Sources: 1) OECD Composite Leading Indicator (CLI) as published on data.oecd.org

2) JP Morgan Purchasing Manager Index, J.P. Morgan and IHS Markit in cooperation with ISM und IFPSM

5 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

Car production forecast stabilizing at ~20% YoY decline for FY20

Global light vehicle production by quarter		Light vehicle production by region (YoY, %)

Automotive

Market

Units (million)	Y/Y
30	FY20		10%
90m	72m		5%
	-4%		0%
25		-11%	-5%
	-10%
	22.8
		-15%
	-22%
		-20%
20		18.7	-25%
	17.8	-30%
			-35%
15	-45%		-40%
		-45%
	12.3		-50%
			-55%
10			-60%

Oct-	Jan-	Apr-	Jul-	Oct-	Jan-	Apr-	Jul-
Dec'18 Mar'19 Jun'19 Sep'19 Dec'19 Mar'20	Jun'20 Sep'20

World

-5.9

-20.3

FY19 FY20

NAFTA

-1.3

-23.0

FY19 FY20

Europe

-3.8

-24.2

FY19 FY20

China

-13.3-9.0

FY19 FY20

Source: Light vehicle production forecast based on monthly IHS Data, fiscal year based. As of: July 16, 2020

6 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

COVID-19 (SHIELD) savings status:
Implemented FCF measures at ~ €60m in Q3
					(€m)
HR measures (€m)
	Main elements:				~160
	 Reduction of time/holiday accounts		Status Q3:
~20
 Short-time work
	 Foreign governmental programs
	 Hiring freeze
Operations measures (€m)
~45	Main elements:			~60
 Investment cuts/postponements
		~30
	 Travel ban	Implemented
	 External spending e.g. consulting
Financing measures (€m)			EBITDA	FCF	Liquidity
~100	Main elements:
	FY20
	 Drawing of credit facilities	~50'	~100'	~220'
	Target
	 Tax deferrals
	 Procurement activities

Figures shown are cash and/or profit effective latest by June 30

7 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

Established performance programs already above full year ambition

		Gross savings		Gross savings
		Q3 FY201)		YTD FY201)	Comments
Overhead				• Performance program savings gained further
€16m		€48m
productivity		momentum; full year ambition level already
global
			reached after three quarters

Transformation	€19m		€44m
of plants

Total

€35m

€92m

1. Gross savings compared to FY19 baseline

• Major contribution in Q3 FY20 from corporate overhead adjustments (Lean HQ)
• Consolidation of traditional specialty lamp production in Germany successfully negotiated

8 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020

COVID-19 with substantial impact on revenue development

Revenue (€m) / Comp. growth (%)1)

OSRAM Group: Revenue bridge Q3 FY20 YoY

850 0.1% 0.6% -29.4%

606

Revenue	FX	Portfolio	Comparable	Revenue
Q3/19			growth	Q3/20

OSRAM Group: Revenue by Region Q3 FY20

OS Revenue Development (comp. growth)

-19.0%

	363	385	359	362		-17.8%
		297
	Q3/19	Q4/19	Q1/20	Q2/20		Q3/20

AM Revenue Development (comp. growth)

				-35.7%
			457	480
	432	431	-34.0%
	282

			Comp. growth	Q3/19	Q4/19	Q1/20	Q2/20		Q3/20
25%			DI Revenue Development (comp. growth)
30%	EMEA	-38.9%
		APAC	-12.5%			-31.3%
		AMERICAS	-39.3%	232	268	217		-19.9%
45%				200	159
1) On October 1, 2019, OSRAM made minor organizational changes involving reclassification between the reportable segments (OS, AM, DI, CIE)	Q3/19	Q4/19	Q1/20	Q2/20		Q3/20

9 OSRAM Licht AG

Q3 FY20 Earnings Release (unaudited figures) | July 29, 2020