Full Year Results 2020/21
1 April 2020 to 31 March 2021

AgendaOpening Remarks

Frank Rehfeld

Business PerformanceFrank Rehfeld

Financial Results

Andrea Borla

OutlookFrank Rehfeld

Proposal to Shareholders

Andreas Hürlimann

Full Year Results 2020/21

19.05.2021

2

Robust financial results for full year 2020/21
Robust results, top-line revenue up 0.4% in constant currencies, EBIT up 4.4%

Better shape than we could have foreseen, due to the resilience and agility of ourtalent, and the long-standing relationships with our customers and suppliers
Fundamental strengths remain:
diversity of business across sectors and regions,
exposure to both mature industries and novel technologies.

Leveraging new technologies through R&D investment rate of above 9% of sales;
We launched ten new products during the last 12 months
Despite the global attention on the pandemic, the underlying challenges ofclimate change remain, and this is a key area where LEM is making its mark

Full Year Results 2020/21

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4

Dealing with Covid-19:
Stories of resilience and agility
Our teams are to be congratulated on their performance thispast year
We are working smarter, adapting to new ways of remotecollaboration, and identifying new processes which will benefit
us and our customers for the future“With top management’s support, we set up a special squad in
China to organize all resources, from supply to production.
Everything ran just-in-time to shorten process lead time. And
we delivered on time.”

Full Year Results 2020/21

19.05.2021

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AgendaOpening Remarks

Frank Rehfeld

Business PerformanceFrank Rehfeld

Financial Results

Andrea Borla

OutlookFrank Rehfeld

Proposal to Shareholders

Andreas Hürlimann

Full Year Results 2020/21

19.05.2021

6A leading company in electrical measurement
Core applications

MotorDrives

Segments

Automotive
Motor control

FY 2020/21 Sales
CHF mPower Storage, Generation,Conversion

Batterymanagement

EnergyMeasurement

Industry
Charging
systems

Drives & Welding

Renewable energies

Traction

High-Precision

Full Year Results 2020/21

19.05.2021

75.7

225.2

Δ CHF

+12.1%-6.3%

Δ constant currency+14.8%-3.7%

7

Global sales spread

GrowthChina with largest share
37.6%
22%

Balanced exposure
Close to customers on
the ground in all keymarkets

38%
10%

30%

Sales

FY 20/21

Q4 20/21

CHF mvs 19/20

vs 19/20

China

113.1

+14.6%+53.2%

Europe

90.9

-7.1%

+5.1%

North America

30.4-18.6%

-4.2%

RoW

66.5

-10.1%

-0.9%

Total

301.0-2.3%*+14.7%* +0.4% at constant currency rates

Full Year Results 2020/21

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Industrysegment

Industry segment
Sales performance
CHF mBusinesses

2020/212019/20

ChangeComments

Drives98.0

99.5-1.5%••

Growth in automation and energy savings applications
Asia and USA recovering

Renewable Energy

81.6

78.7+3.6%••

China solar driven by infrastructure
Europe boosted by DC meterTraction

38.0

51.0

-25.5%••

Longer-term investment cycles
India and China rail traffic impacted by Covid-19

High precision

7.7

11.1

-31.0%••

Budgets switched to Covid needs
Lack of investment confidence for test benches & medical
equipment

Total Industry

225.2

240.4

-6.3%

Full Year Results 2020/21

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10

Industry segment
Regional markets

GrowthChina continues to growdue to renewableenergyCovid-19 continues toimpact sales
Customers remain
hesitant to invest incertain areas like High
Precision and Traction

19%35%
10%36%Sales

FY 20/21

Q4 20/21

CHF mvs 19/20

vs 19/20

China

79.4

+8.5%

+16.8%

Europe81.7-11.4%-1.1%

North America

21.9-16.4%

-5.6%

RoW

42.2

-13.5%

-2.2%

Total

225.2

-6.3%*+2.8%* -3.7% at constant currency rates

Full Year Results 2020/21

19.05.2021

11

Industry next generation products
DrivesTraction

Renewables

HMSR

DCBM

Smart Grid

CDSR
TOP-90ARU

Full Year Results 2020/21

AI-P1A

19.05.2021

12

E-mobility infrastructure
DC charging takes the entire process ofconverting AC current into DC outside ofthe carSensors need to measure within the norms
and standards that have been set

Only one disadvantage of EV– lack ofinfrastructure
If we all drive EVs, it will harmonize power
production and power usage

Government support and investments inthe new technology very important

Full Year Results 2020/21

19.05.2021

13

Automotive segment
Sales performance
CHF mBusinesses

2020/212019/20

ChangeComments

Battery Management

45.7

44.9

+1.7%

••

US reduction in 12V demand
Increased demand for High Voltage productsucts

Motor Control

26.7

19.7

+35.0%•Strong demand spurred by EV cars

Charging Systems

3.4

2.9+16.1%•Continued momentum for battery electric and hybridvehicles

Total Automotive

75.7

67.6+12.1%

The Q4 sales of CHF 22.9 million (+64.5%) are the highest quarterly sales yet achievedby the businessWith the acceleration of the deployment of EV platforms by carmakers, our products
have been designed-in for several vehicles which entered production in 2020

Full Year Results 2020/21

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15

Automotive segment
Regional markets

China YoY sales up +32.2%,driven by consumer demand forEVs and the launch of several
new vehicles
Europe grew due to OEMs
continuing to ramp-up
production operations
North America transition togreen cars still at a slower pace
RoW declined, with strong sales
in Korea offset by Japan

Growth32%
45%

11%
12%

Sales

FY 20/21

Q4 20/21

CHF mvs 19/20

vs 19/20

China

33.7

+32.2%+208.9%Europe9.2+63.5%+125.2%

North America

8.6-23.8%

-1.2%

RoW

24.3

-3.7%

+1.5%

Total

75.7

+12.1%*+64.5%* +14.8% at constant currency rates

Full Year Results 2020/21

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16

Automotive next generation products
Battery management

CAB 1500 SF

Motor control

HC16F

Full Year Results 2020/21

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17

Driving forces on current sensing technologies

Battery management: functionalintegration

Motor control: physical integration

Full Year Results 2020/21

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18

AgendaOpening Remarks

Frank Rehfeld

Business PerformanceFrank Rehfeld

Financial Results

Andrea Borla

OutlookFrank Rehfeld

Proposal to Shareholders

Andreas Hürlimann

Full Year Results 2020/21

19.05.2021

19Performance at a glance

CHF m

FY 2020/21

FY 20/21

Q4 20/21

vs 19/20

vs 19/20

Orders received

362.0+12.3%+72.8%

Sales301.0-2.3%*+14.7%

EBIT

60.9+4.4%+44.9%Net profit

55.6-8.4%+125.2%* +0.4% at constant currency rates

Sales at constant exchange rates increased by 0.4%

EBIT improved mainly due to improved gross margin and reduction in SG&A
Last year’s net result boosted by a non-recurring positive tax impact
Net profit margin decreased to 18.5% compared with 19.7% (excluding thepositive tax impacts the net profit margin last year was 15.2%)

Full Year Results 2020/21

19.05.2021

20Gross margin
CHF m

160

FY50%Q4Q42020/21 2019/20 2020/21 2019/20

14048%
120

FYIn CHF m

140.6

142.7

40.0

31.9

In % of sales

46.7%

46.4%

48.3%

44.2%

46%
10080

44%

60
42%

Gross margin increased by 30 basis pts:

Higher supply chain costs due to Covid-19

4040%
20

038%
16/17

17/18

18/19

19/20

Full year GM in % of sales

20/21

Offset by improved purchasing efficiencies andother improvement programs
83% of sales produced in China and Bulgaria

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21

SG&A
CHF m60

FY30%

Q4FY

Q4

2020/21 2019/20 2020/21 2019/20

5040

In CHF m

52.6

56.5

14.3

13.8

In % of sales

17.5%

18.3%

17.3%

19.2%

20%

30

2010%

Reduced marketing and travel expenses andchanges in working practices
SG&A costs fell to 17.5% of sales

1000%
16/17

17/18

18/19

19/20

Like-for-like decrease CHF 3.9m

20/21

Full year SG&A in % of sales

Full Year Results 2020/21

19.05.2021

22R&D
CHF m

30

FY10%

FY

Q4

Q4

2020/21 2019/20 2020/21 2019/20

258%

In CHF m

28.2

28.0

8.4

6.1

In % of sales

9.4%

9.1%

10.2%8.5%

206%
154%
1050

16/17

17/18

18/19

19/20

20/21

R&D expenses basically stable

2%

Investment continues to bear fruit with anotherten new products launched successfully0%Long-term strategy ensures targeted newtechnologies and applications for customers

Full year R&D in % of sales

Full Year Results 2020/21

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23

Financial expense
FYFY

Q4

Q4

2020/212019/20

2020/212019/20

Exchange effect

0.4

(2.4)

0.2

(1.5)

Other financial expense & income

(0.4)

(0.3)

(0.1)

(0.1)

Total

(0.0)

(2.7)

0.1(1.6)

CHF m

Financial expenses offset by foreign exchange gains

USD, EUR and JPY cash flows are hedged
Interest costs relate mainly to expenses on lease liabilities

Full Year Results 2020/21

19.05.2021

24Income taxes
FY
2020/21FY
2019/20

Expected income tax rate

13.7

15.8

Expected withholding tax rate

2.2

1.0

Expected tax rate

15.9

16.8

Other differences(7.2)(25.9)

Effective tax rate

8.7

(9.1)

%

Group tax expenses 2020/21 represent a tax rate of only 8.7%, mainly due to thetransfer of the trademark usufruct from LEM HOLDING to LEM International
Excluding this non-recurring tax benefit, the underlying tax rate would amount to17.4%
Last year as well included a non-recurring tax benefit of CHF 14.0m following theIP transfer from LEM IP to both LEM China and LEM International
Full Year Results 2020/21

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25

Income statement
Q4

Q4

Change2020/21

2019/20

307.9

-2.3%

82.8

72.2

46.7%

46.4%

+0.3%pt

48.3%

44.2%

Operating expenses(79.7)(84.4)-5.6%(22.7)(19.9)

EBIT

60.9

58.3

+4.4%

17.3

11.9

EBIT margin %

20.2%

18.9%

+1.3%pt

20.9%

16.5%

Net financial expenses

(0.0)

(2.7)

n/a

0.1

(1.6)

Income tax

(5.3)

5.1

n/a

2.1

(1.7)

Net profit

55.6

60.7

-8.4%

19.6

8.7

18.5%

19.7%

-1.2%pt

23.6%

12.0%

FY

FY

CHF m

2020/212019/20

Sales

301.0

Gross margin %Net profit margin %Full Year Results 2020/21

19.05.2021

26

Balance sheet

CHF m

31.3.2021

31.3.2020

Net working capital

25.8

7.2

Fixed assets

122.6

114.9

Noncurrent liabilities(14.9)(15.0)Net operating assets

133.5

107.1

Net cash/(debt)

(1.6)

10.2

Equity

131.9

117.4

Equity ratio

49.9%

51.0%

Days of sales outstanding

7467

Days of inventory outstanding

10886

Days of payables outstanding48

43• Balance sheet remains
strong with practicallyzero net debt

• Net working capitalincrease due to higher
receivables from strong
Q4 sales and built-up ofsafety stock• Equity ratio basicallystable at 50%

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Cash flow

CHF mFY
2020/21FY
2019/20

Profit before taxes

60.9

55.6 •

Adjustment for non-cash items and taxes paid

5.0

8.1

Cash flow from changes in net working capital(15.0)

9.9

Cash flow from operating activities

50.9

73.6

Cash flow from investing activities(13.5)(14.7)

Free cash flow

37.4

58.9

Cash flow from financing activities(35.0)

Change in cash and cash equivalents

2.4

Cash and cash equivalents at the end of the period

22.4

Cash flow from operating
activities was CHF
50.9m (-30.9%) and free
cash flow was CHF 37.4
million (-36.4%)• Net working capitalincrease of CHF 15.0m(51.3)and one-off CHF 6.4m
tax payment have
7.6
lowered free cash flow
19.2

Full Year Results 2020/21

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28

AgendaOpening Remarks

Frank Rehfeld

Business PerformanceFrank Rehfeld

Financial Results

Andrea Borla

OutlookFrank Rehfeld

Proposal to Shareholders

Andreas Hürlimann

Full Year Results 2020/21

19.05.2021

29

Outlook – Financial Year 2021-22
Cautiously optimistic for the 12 months to comeLEM benefits from geographic and sector diversity;
however, China production is dependent on demand
from other economies
Shortages and supply chain issues for components
and ongoing trade disputes to impact business

Fundamental long-term prospects remain strong,driven by renewable energy, mobility and automation
Continued investment in R&D between 8-10% ofsales

Impacts of the pandemic will reverberate acrossmarkets and society for many months if not years
Full Year Results 2020/21

19.05.2021

30

AgendaOpening Remarks

Frank Rehfeld

Business PerformanceFrank Rehfeld

Financial Results

Andrea Borla

OutlookFrank Rehfeld

Proposal to Shareholders

Andreas Hürlimann

Full Year Results 2020/21

19.05.2021

31

The long-term view

Share price development from 31 March 2011 to 31 March 2021: +220%

Distributed dividends over the last 10 years: CHF 344m
Full Year Results 2020/21

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32

Proposal to shareholders
Dividend policy of distributing significantly
more than 50% of consolidated net profit

53,347,840,035,038,235,048,842,046,040,042,039,1

Consideration of financial strength and difficult
economic environment

Proposed ordinary dividendof CHF 42 per share, up from CHF 40
Payout ratio of 86.1%, up from 75.1%
Represents a dividend yield of 2.3% (as per 31March 2021)
Sign of trust in the Company’s future

15/16

16/17

17/18
Dividend

18/19

19/20

20/21

Earnings per share

Full Year Results 2020/21

19.05.2021

33

Thank you

Full Year Results 2020/21

19.05.2021

34

Q&A

Full Year Results 2020/21

19.05.2021

35

lifeenergy
motionFinancial calendar and contact details
The financial year runs from 1 April to 31 March

For further information

24 June 2021

Annual General Meeting 2020/21

Andrea Borla, CFO

1 July 2021

Dividend ex-date

Phone: +41 22 706 12 50

6 July 2021

Dividend payment dateE-mail: investor@lem.com

28 July 2021

First-quarter results 2021/22

8 November 2021

Half-year results 2021/22

4 February 2022

Third-quarter results 2021/22

24 May 2022

Year-end results 2021/22

30 June 2022

Annual General Meeting FY 2021/22

5 July 2022

Dividend ex-date

7 July 2022

Dividend payment date
Full Year Results 2020/21

19.05.2021

37