Life  Energy  Motion
Agenda

9 Months Results 2021/22    04.02.2022
2 Leading the world in electrical measurement, LEM engineers the best solutions for energy and mobility, ensuring that our customers' systems are optimized, reliable and safe.
>  Continued strong momentum from the first half of the year >  We could have sold even more and were disappointed not to be able to satisfy customer demand, despite our best efforts to overcome the ongoing supply chain challenges >  Our global bookings remain at record levels, with customers firmly committing to orders over longer time horizons >   China, Europe and Asia continue to lead our growth >  Industry segment is benefitting from acceleration of decarbonization across the world >  Investment confidence remains solid in all our businesses, helped by government policies and infrastructure development >  Automotive segment particularly hampered by shortages of semiconductors and other components >  We remain encouraged by the fundamental transition towards Electric Vehicles
9 Months Results 2021/22    04.02.2022

Source: World Bank, January 2022 >  Growth to decelerate to 4.1 percent in 2022, reflecting continued COVID-19 flare-ups, diminished fiscal support, and lingering supply bottlenecks > Global growth is projected to soften further to 3.2 percent in 2023, as pent-up demand wanes and supportive macroeconomic policies continue to be unwound >  Growth in China is set to ease to 5.1% this year, partly due to the lingering effects of the pandemic as well as additional regulatory tightening from Beijing
9 Months Results 2021/22    04.02.2022
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>  Continue to trouble-shoot and find alternatives >  Continue to collaborate with customers and suppliers for long-term solutions >  Further develop semiconductor capabilities over the coming 3 years >  Design, Packaging, Testing >  Ultimate bottleneck for all players is wafer manufacturing capacity >  Demand is strong across all our businesses >  We invest into further production capacity >  Sales growth hampered throughout 2022
9 Months Results 2021/22    04.02.2022
Agenda

9 Months Results 2021/22    04.02.2022

Core applications

9 Months Results 2021/22    04.02.2022
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> China and Europe lead growth > Balanced exposure > Close to customers on the ground in all key markets
* +24.3% at constant currency rates
9 Months Results 2021/22    04.02.2022
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>  All businesses continue to benefit from the return of investment confidence and customer demand, although our sales were held back by capacity constraints >  The fundamentals remain strong, as decarbonization and electrification accelerates across the world
9 Months Results 2021/22    04.02.2022
11 Industry segment Regional markets > Europe, China and RoW benefited from demand across Drives, Renewables, and High Precision > Europe continues to be largest market >  North America benefited from the demand for Drives, but less so for Renewables
* +27.0% at constant currency rates
9 Months Results 2021/22    04.02.2022
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Drives Renewables Traction Smart Grid HTRS ARH Automotives segments performance. Dynamism Persistence
Sales performance CHF m
> Output constrained by continued supply chain issues for semiconductors and other components > Q3 bookings back to more realistic levels, although for the full 9 months bookings more than doubled compared with 9 months 2020/21 > Bookings reflect strong fundamental demand for EV solutions and customers’ commitments to orders over longer time horizons
9 Months Results 2021/22    04.02.2022

Regional markets >  China grew due to consumer appetite for EVs and the launch of several new vehicles >   Electrification grows in Europe, although Q3 sales suffered due to component shortages >   North America transition to EVs not quick enough to compensate for decline in combustion engine battery sensors >   Rest of World increased slightly, as it had been less impacted by the pandemic
* +15.9% at constant currency rates
9 Months Results 2021/22    04.02.2022

Battery management Motor control Charging systems HSBBV HST CDT Series
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Agenda

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>  Global bookings remain at record levels >  Sales at constant exchange rates improved by 24.3% >  EBIT and net profit improved mainly due to the increase in revenue
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CHF m 160 50%
Gross margin increased by 110 basis pts: > Higher sales volumes >  Improved economies of scale > 80% of sales produced in China and Bulgaria – Full year GM in % of sales ー ● − 9M GM in % of sales
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SG&A CHF m
> Costs increased in absolute terms to support extra demand >  ... but in relative terms fell to 15.8% of sales
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CHF m
> R&D increased in absolute terms by 13.6% > Investment continues to bear fruit with additional new products launched successfully > Long-term strategy ensures targeted new technologies and applications for customers
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>  Negative foreign currency effect mainly on EUR accounts receivables following recent EUR depreciation >  Marginally compensated by EUR hedges >  Low financial expenses due to low interest rates
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> Effective tax rate lower due to favorable geographic profit mix and tax credits from R&D center in France >  LEM China benefits from the HNTE (High & New-Technology Enterprise) reduced tax rate of 15% >  Withholding taxes mainly on dividends paid from China to Switzerland

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Agenda

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>  We continue to benefit from the fundamental drivers of electrification, renewable energy and mobility >  We still face headwinds from the impact of the pandemic on different markets, including shortages for components f such as semiconductors >  For the full financial year 2021/22, the company is > slightly increasing its sales outlook to around CHF 360 million (CHF 301.0 million for 2020/21) >  raising its forecast EBIT margin to around 22% (20.2% for 2020/21)
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/ミッションQ&A 9 Months Results 2021/22    04.02.2022    28
The financial year runs from 1 April to 31 March
For further information Andrea Borla, CFO Phone: +41 22 706 12 50 E-mail: investor@lem.com
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life energy motion