Results
Q1 of 2012/13
1 April 2012 to 30 June 2012

Agenda1. LEM at a Glance
2. Highlights and Business Review
3. Financial Review
4. Strategy and Outlook2

1. About LEM■ LEM is the global market leader in providing innovative and high quality
solutions for measuring electrical parameters.
■ The current and voltage transducers are used in a broad range of industrial
and automotive markets.
■ LEM is a high growth global company with approximately 1’200 employees.
Production plants are in Beijing (China), Geneva (Switzerland) and Machida(Japan). With regional sales offices close to the clients’ locations, LEM
provides a seamless service.
■ LEM (SIX: LEHN) has been listed on the SIX Swiss Exchange since 1986
and has a market cap of CHF 549 million per 30.6.2012.

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1. LEM Applications: Robot To control the arm, power inverters drive amotor from one position to the next andstop precisely in position Accurate measurement of the current withtransducers needed to control the arm

A CASR
1 Control Unit
2 Inverter
3 Motor4

1. LEM Applications: Mobile Phone Base Station
 Transducers ensure stable power supplyand control in case of a failure Transducers used to control the charge
and discharge of power batteries forbackup

A HASS
B LTS
1 Antenna
2 Battery
3 Controller
4 Power supply

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1. LEM Applications: Electric Plug-in Car
 Battery management
 Electric motor management
 Charger management

1 High-voltage battery
2 Vehicle control unit
3 Charger
A HAH1B DHABC HC5F
D CAB

4 Motor controller
5 Electric motor and transaxle
6 DC/DC converter
7 Electric power steering

61. LEM Applications: Plasma Cutting
 To maintain the arc continuously, current
transducer measures the current throughthe arc
 Accuracy of measurement is important toguarantee accuracy and shape of cut

A LAH
1 Electronic
2 Motor
3 Torch
3 XY-table71. LEM Production & Logistics World-WideProduction Centers (PDCs)
Adaptation Centers
Sales Offices
Agents / Distributors
8

1. LEM at a Glance - Businesses
Industry segment
Drives & welding

Automotive segment
Conventional cars

■Motor drives■ Welding■ Miscellaneous■

Renewable energies &power supplies

Green cars (HEV, EV)

Solar■ Wind■ UPS■ Battery monitoring, processcontrol, energy metering■Lead battery management■ Start/stop application

Battery pack management■ Electric motor control■Traction
On-board applications■ Trackside■ Energy monitoring■High precision
Medical scanner■ Test & measurement■92. Highlights and Business Review

102. Highlights Q1 2012/13
In CHF millions, %Q1 2012/13

Q1 vs. Q1 2011/12

Q1 vs. Q4 2011/12

Orders

60.7

22.5%

10.3%

Sales

63.1

-6.7%

13.0%

Operational EBIT

11.4-2.1%

41.4%

Net earnings

10.7

48.6%

37.7%

■

Global economic uncertainty affects business development■

High competitive pressures■Continuing growth in Automotive businesses■Positive effects due to re-stocking of customers in Industry businesses■

Strong improvements in sales and bookings■

Careful short term outlook
112. Net Sales
In CHF millions

In CHF millions, %

300

Sales

Q1 vs. Q1

Q1 vs. Q4

275

Industry

53.5-13.6%

13.1%

250

Automotive

9.6

67.6%

12.5%

Total sales

63.1

-6.7%

13.0%

225200

■

175■

150

Slow restart in Q1 of 2012/13
Growth mainly in Asia (includingChina) and North America

125
100
7550
25008/09

09/10

10/11

11/12

Q1 12/13122. Quarterly View
In CHF millionsBook‐to‐bill ratio

100

1.690

1.480
70

75.0

77.0

77.4
1.2

67.7

66.8

63.1
57.960■ Customers’ inventory
corrections ended in Q4 of
2011/1255.055.7

1.00.85040■ Slow recovery of sales■ 3rd quarter in a row withgrowing orders

0.6

30
0.420

■ Book-to-bill ratio close to 1
for the second quarter

0.2

10

0.00
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
10/11 10/11 10/11 10/11 11/12 11/12 11/12 11/12 12/13

Orders received

Sales

Book-to-bill ratio13

2. Industry Segment: Regional MarketsIn CHF millions, %Sales

Q1 vs. Q1

Q1 vs. Q4

Europe26.5-16.8%

0.0%

N. America

7.5

3.4%

6.9%

Asia

18.2-14.2%

40.5%

ROW

1.3-16.9%

62.3%

Total

53.5

-13.6%

13.1%

EuropeNorth America
Asia

2%

Rest of the World

34%
50%



Positive effect from recovery in solar
markets
Strong growth in Asia, particularly in
China

14%

142. Industry Segment: Business Development
In CHF millions

Op. EBIT in % of sales
25280

20240

200
15160

10120

Businesses and Applications
Drives & welding Strong growth in Asia, particularly China
 New projects in the robot and elevator
markets
Renewable energies & power supplies
 Proved again its volatile nature – sales
grew by 32.8%
 Solar market shifts from Europe to Chinaand USATraction Additional trackside projects in UK China remains weak

80
540

00
08/09

09/10

10/11

11/12

Q1 12/13

High precision Decrease of sales due to delays in test
and measurement markets and relocationof LEM’s high precision production fromDenmark to Switzerland15

2. Automotive Segment: Regional Markets
EuropeIn CHF millions, %Sales

Q1 vs. Q1Q1 vs. Q4Europe

0.9

60.3%

0.9%

N. America

4.6

47.6%

9.3%

Asia andROW

4.1

100.0%

19.3%

Total

9.667.6%

12.5%

North America
Asia and Rest of World9%

43%

48%



Sales growth despite weak global car
industry in Q1 of 2012/13
Success due to strategic focus on
Asian and US car manufacturers
Continued investment in R&D

16

2. Automotive Segment: Business Development
In CHF millions

Op. EBIT in % of sales

3025252020

15

15
10

Businesses and Applications
Conventional cars
 Continued on positive sales trend
Green cars (HEV, EV)
 High level of activity
 Sustainable growth in LEM’s key
regions

10550008/09‐509/10

10/11

11/12

Q1 12/13-5‐10-10‐15-1517

2. Business Development ChinaProduction

Sales
■
■

Market share of over 50%
Sales impacted by slowing activity
especially in solar, wind and traction

LEM China expands its #1 position aslargest manufacturing site of the Group(first time ever over 50% of total
production)“Made by LEM” quality■■

In CHF millions
120In CHF millions
55100

45803560
2540
1520
50
‐508/0909/1010/11

11/12

Q1 12/13

08/09

09/10

10/11

11/12

Q1 12/13
18

3. Financial Review

193. Income Statement
Q1
2011/12

Change vs.
Q1 2013

Q4
2011/12

Change vs.
Q1 2013

Q1
2012/13

Sales

67’659-6.7%

55’844

13.0%

63’118Gross margin

42.4%-0.3%pt

37.0%

5.1%pt42.1%

Operating expenses-17’101-11.0%-12’61720.7%-15’224

Operational EBIT

11’600

-2.1%

8’030

41.4%

11’359Additional SOP
income / costs-121

N/A-322

N/A0EBIT

11’479

-1.0%

7’709

47.4%

11’359Financial expense (net)-2’339

N/A-1’090

N/A

1’501

Income tax-1’928

11.0%

1’189

N/A

-2’140Net profit

7’212

48.6%

7’808

37.3%

10’720

In CHF thousands, %203. Results by Quarter
In CHF millions

In % of sales

10030%

90
75.0

80
70

77.0

25%

77.4
67.7

66.8

63.1
57.9

60

■ Improved operating EBIT margin;
within target range

55.0

20%

55.8

5015%

■ High net profit in % of sales,
resulting from decreased tax
charge and positive foreignexchange effects

4010%

30
205%

1000%
Q1Q2
Q3Q4
Q1Q2Q3Q4
Q1
10/11 10/11 10/11 10/11 11/12 11/12 11/12 11/12 12/13

Orders received

Sales

Op. ROSNet Profit in % of sales

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3. Gross Margin
In CHF millions

In % of sales
46%

13545%
120
44%

105
90

43%

75

42%

60
41%
4540%
30

Gross margin

Q1
2011/12Q4
2011/12Q1
2012/13

28.7

20.6

26.6

42.4%

37.0%

42.1%

in CHF millions

Gross margin
in % of sales■ Negative impacts on gross margin in Q4
2011/12 (foreign exchange effects,increased price pressure, lower absorptionof fixed cost, impairment of CHF 2.1 million
in renewables energies production)■ Stabilization of gross margin in Q1 2012/13

39%

1538%

008/09

09/10

10/11

11/12

Q1
2012/13223. Operating Expenses
In CHF millions

In % of sales

7030%

60

25%

Operatingexpenses20%

Operatingexpenses

50

Q1
2011/12Q4
2011/12Q1
2012/13

17.1

12.6

15.2

25.3%

22.6%

24.1%

in CHF millions

in % of sales
4015%
30
10%
20

■ Ongoing strict cost control measures■ Operating expenses as a percentage ofsales remain on low levels compared tohistorical average

5%

1000%
08/09

09/1010/11

11/12

Q1 12/13
23

3. R&D Expenses
In CHF millions

In % of sales

1510%

R&D expenses
in CHF millions
12Q1
2011/12Q4
2011/12Q1
2012/13

3.7

2.6

3.5

5.5%

4.7%

5.5%

8%

R&D expenses
in % of sales
96%■ Continued investment in R&D for bothsegments
64%

32%

0

■ R&D expense at long-term average of
5.5%

0%
08/09

09/10

10/11

11/12

Q1 12/13

24

3. Operational EBIT
In CHF millions

In % of sales

7022%

OperationalEBIT

Q1
2011/12Q4
2011/12Q1
2012/13

11.68.1

11.4

17.1%

14.4%

18.0%

in CHF millions

6020%

5018%

in % of sales

16%■ Returned to operational EBIT-margin
within target range

14%■ Excluding additional SOP cost/income in2011/12

4030

2012%

10010%
08/09

09/10

10/11

11/12

Q1 12/13

OperationalEBIT■ All legacy stock option plans ended as
per 31 March 2012, LEM does not record
any additional stock option plans
cost/income as from 2012/1325

3. Legacy SOP Programs Expired per 31.03.2012■■■With the closing of fiscal year 2011/12, all legacy stock option plans are closedLEM will not record any additional stock option plan cost/income going forward
LEM has no further option based compensation programs# outstanding options

31.3.2008

31.3.200931.3.201031.3.2011

31.3.2012

70’45766’20740’7944’952

0Closure ofSOP 5

SOP 626

3. Financial Expense
In CHF thousands

Exchange effect*
Other financial expense & incomeTotal

Q1 2011/12

Q4 2011/12

Q1 2012/13-2’309-1’028

1’522

-30

-62

-21

-2’339-1’090

1’501

 Q1 of 2012/13 exchange effect mainly driven by USD & CNY appreciation
vs. EUR & CHF
 Foreign exchange hedging policy In general: 50% of net exposure on a rolling 3-9 month basis
 Euro: 100% of net exposure 12 months forward*The line “exchange effect” in the financial result is mainly due to currency volatility during the time between booking andsettling a receivable/payable. Over and above this line, foreign exchange rates impact every P&L line through the rate at
which each transaction is booked and at which it is consolidated into CHF.

27

3. Net Profit
CHF millions% of sales

Q1
2011/12Q4
2011/12Q1
2012/137.2

7.810.7

10.7%

14.0%

17.0%

Net profit
4520%

in CHF millions

Net profit
4018%

in % of sales

Q1 2011/12

35

‐0.1

16%

‐2.3
‐1.9

30
14%

11.6
7.3

2512%
20

Operational EBIT SOP inc./cost

FinancialexpenseIncome tax

+1.5

‐2.1

Net profit

10%
15
0.08%

106%

54%

008/09

09/10

10/11

11/12

Q1 12/13

Q1 2012/13

11.4

Operational EBIT SOP inc./cost

10.7

FinancialexpenseIncome tax

Net profit28

4. Strategy and Outlook29

4. Market Factors and Strategy■ We firmly believe in our strategicdirection and the 4 drivers for ourbusiness remain unchanged■ We will continue to capitalize on
the drivers of LEM’s markets
through pure play components company
 diversification across geographiesand markets30

4. Strategic Priorities to Extend Leadership Position
Increase technology leadership■ Established multidisciplinary innovation team
■ R&D roadmap foresees increased number of product launches■ Improve performance of products in terms of precision and functionalities■ Dedicated team of experts to manage LEM’s IP
Increase efficiency■ Improve product cost through low cost sourcing and manufacturing■ Reduce complexity of organization
Increase production flexibility■ Improve supply chain management■ Develop systems to better forecast demand fluctuations31

4. Outlook■ We expect the economic climate to remain challenging and uncertainty topersist in LEM’s markets■ In the next quarters we expect lower positive impacts from restocking
and higher negative impacts from competitive pressure■ For 2012/13 we expect:■ progressive restart in the Industry segment■ growth in the Automotive segment■ increasing competitive pressure■ Our ambition is to deliver a result within the operational EBIT margin
target range of 15 to 20%

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Financial Calendar and Contact Details
Financial calendar
13 November 2012
14 February 2013
5 June 201327 June 2013
2 July 2013
5 July 2013

Half-year results of 2012/13
Third quarter results of 2012/13
Year-end results and media and analyst conference
Ordinary shareholders’ meeting for the year 2012/13
Dividend ex-date
Dividend payment date

For further information
Julius Renk, CFO
Tel: +41 22 706 12 50
Email: investor@lem.com

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