SLM Solutions Group a leader in metal based 3D printing

Transcription

1 SLM Solutions Group a leader in metal based 3D printing Company presentation 7 April 2014

2 Disclaimer This Presentation has been produced by SLM Solutions Group AG (in the course of formation) (the Company ) and no one else and is furnished to you solely for your information. This document contains certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which the Company operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words believes, expects, predicts, intends, projects, plans, estimates, aims, foresees, anticipates, targets, and similar expressions. The forward-looking statements, including assumptions, opinions and views of the Company or cited from third party sources, contained in this Presentation are solely opinions and forecasts which are uncertain and subject to risks. A multitude of factors can cause actual events to differ significantly from any anticipated development. None of the Company or any other person guarantees that the assumptions underlying such forward-looking statements are free from errors nor do they accept any responsibility for the future accuracy of the opinions expressed in this Presentation or the actual occurrence of the forecasted developments. No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and, accordingly, none of the Company or any other person or any of its parent or subsidiary undertakings or any of such person s officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document. By reviewing this Presentation you acknowledge that you will be solely responsible for your own assessment of the Company, the market and the market position of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. This publication constitutes neither an offer to sell nor an invitation to buy securities. This Presentation speaks as of 07-Apr-14. Nothing shall under any circumstances, create any implication that there has been no change in the affairs of the Company since such date. This presentation is not for publication or distribution, directly or indirectly, in or into the United States of America. This presentation is not an offer of securities for sale into the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States. No offer or sale of transferable securities is being, or will be, made to the public outside Germany and Luxembourg. Offers in Germany and Luxembourg will be made exclusively by means of and on the basis of a prospectus that will be published and will be available free of charge inter alia at the Company. 1

3 1 SLM Solutions Group overview 2

4 Experienced and dedicated management team Dr Markus Rechlin CEO Uwe Bögershausen CFO Henner Schöneborn EVP, Founder / Shareholder Hans Ihde Founder / Shareholder Chairman of Supervisory Board Responsibilities Research & Development Purchasing and Logistics Production Quality Service Key client accounts Corporate Finance Accounting and Controlling IT, Facility Management Legal, Compliance Investor Relations Sales and Product Marketing Technology Innovation Application Technology Key Account Management Market Development, PR Key client relationships Relevant experience 22 Years 15 Years 28 Years 43 years Prior Professional Experience Bain Capital Boston Consulting Draeger Medical PhD in Engineering from RWTH Aachen CFO Derby Cycle AG (IPO) CFO aleo solar AG (IPO) Roland Berger Master degree in Economics from University of Oldenburg Hydraulic and Pneumatic Engineer Application Consultant Master degree in Technology Economics and in Mechanical Engineering and Design CEO MCP Group CEO MTT Group CEO SLM Solutions Group Commercial education Balanced mix of industry veterans and highly experienced management with complementary technological, operational and capital markets skill sets 3

5 SLM Solutions Group a leader in metal 3D printing Key products A leading metal 3D printing company Historical origins in rapid prototyping technology (a) Paved the way for today s primary focus: 3D printing for industrial volume production and prototyping A leader in selective laser melting technology SLM 125 HL SLM 280 HL Installed base of 133 (b) SLM systems as per 31-Dec SLM machines sold in 2013 >80 employees in 2 locations as of 31-Dec-13 SLM 500 HL (a) As subsidiary of MCP group (b) Number of machines brought to market via SLM HL : 76 thereof 4 demo machines, via Fockele & Schwarze: 5, via MTT: 6, 46 Realizer machines were brought to market and serviced by SLM Solutions Group 4

6 SLM Solutions Group a global company Revenue split by region (a) Revenue split by segment US 16.9% RoW 7.7% Germany 32.9% Rapid Prototyping 23% EU ex Germany 20.0% International revenues: 67.1% Asia/ Pacific 22.5% Selective Laser Melting 77% Total 2013: 21.6m Total 2013: 21.6m (a) Bonuses and discounts not allocated to regions. Based on IFRS financials 5

7 SLM Solutions Group rapid and profitable growth Strong revenue growth and margin expansion ( m) # of SLM machines sold CAGR: 35% Strong organic growth with CAGR of approx. 35% % Healthy and increasing adjusted EBITDA margin % 11.1% % Disciplined fixed cost base and asset light business model support profitability and returns (a) (a) Growth resulting in scale effects in production and raw materials procurement Revenue Adjusted EBITDA Adjusted EBITDA margin Note: Based on IFRS financials (a) EBITDA adjusted for one-off costs related to entry of Parcom Deutschland I GmbH & Co. KG, one-off costs related to IPO and other non-recurring costs. 6

8 SLM Solutions Group a deep rooted 3D printing heritage SLM 280 HL SLM 125 HL Hull Core technology SLM 500 HL Multi laser technology & automated powder handling devices 2013 Drive industrial application of 3D metal based printing technology 2014 onwards SLM 250 HL 2011 First company to process aluminum and titanium 400 Watt technology Development of SLM technology Fibre Laser technology Rapid prototyping Since 1970 Note: History of SLM Solutions Group and its predecessors 7

9 Minimal penetration to date of an enormous addressable market 3D printing today as a % of the manufacturing market $10.5tn $2bn Implied metal 3D printing market size of $0.2bn (~9% of 3D printing is metal based 3D printing) 100% The global economy is worth about $70 trillion, and manufacturing accounts for more than 15%, which is $10.5tn. Opportunity If AM grows to capture just 1% of this global manufacturing market, that s $105bn Source: Wohlers < 0.1% Manufacturing market (2012) 3D printing market (2012) Source: CODEX Partners, Wohlers 8

10 Metal 3D printing is believed to be at an inflection point Phases of customer adoption process Revenue opportunity Industrial companies for volume production Industrial companies for prototyping Academic and R&D Source: Roland Berger, Broker research Time Today 9

11 SLM Solutions Group one of few pure play metal 3D players Name HQ Steel Titanium Materials Industries Revenues Aluminum Nickel Cobalt-Chrome Precious alloys Other materials Dental Healthcare Automotive Aerospace Tool making Jewelry 2012 in m Number of metal 3D printing systems sold in 2012 (a) EOS DE x x x x x x x x x x x x x nm 44 DE x x x x x x x x x x Key considerations SLM Solutions Group one of few pure play 3D metal printing companies Our solutions provide readyto-use parts in volume and excel across speed, quality and cost Concept Laser DE x x x x x x x x x x x x x Arcam SE x x x x x Density grade of up to 99.9%, comparable to the highest quality of traditional manufacturing processes Realizer DE x x x x x x x x x x x 4 14 Renishaw UK x x x x x x x nm 12 Phenix Systems (b) FR x x x x x x x x 4 10 Main competitors are Concept Laser and EOS Different technology than Arcam (a) Sorted by estimated revenues of metal 3D printing systems sold in 2012 (b) Acquired by 3D Systems in July 2013, company register, Creditreform, CODEX Partners, Wohlers 10

12 Our flagship product: The SLM 500 HL Key considerations Designed for industrial applications Developed since 2010 with early involvement of key customers during development Highest build rate among laser technologies available in the market today (a) Build chamber has been designed according to the advice of automotive and Build chamber of 500 x 280 x 325 mm Multi laser technology with up to 4 scan heads (4x400W) Hull-core technology with 2 scan heads (2x400W and 2x1000W) Optional Beam Switch (400W/1000W) for hull-core strategy Automatically exchangeable build chamber to allow for continuous machine usage, ie no time required for cooldown of object ( Wechselbauraum ) Latest generation turbine blades Titanium Hip Implant Impeller Automatic powder handling / sieving station Strong interest from customers 4 prototypes sold Mid 2014 start of serial production planned (a) Source: CODEX partners 11

13 2 Key investment highlights 12

14 SLM Solutions Group a leader in metal 3D printing 1 Massive market potential 3D Printing: Massive addressable market nearing inflection point with a long runway for growth 2 Superior positioning Sweet spot positioning in the 3D printing industry targeting the most attractive segments 3 A technology leader A leader in 3D metal printing market with excellent technology and differentiated solution 4 Barriers to entry Excellent IP portfolio and application know-how 5 Proven technology Diverse and growing blue chip customer base 13

15 1 3D printing is a highly disruptive technology Rapidly growing expanding market opportunity (global market size) (US$bn) The 3D Printing market is expected to grow at 25% CAGR, partially by replacing traditional manufacturing processes but also by creating its own unique applications D Printing awareness has significantly increased over time = Google trends development (a) February 10, 2011 The Economist published cover article Print me a Stradivarius: How a new manufacturing technology will change the world November 12, 2012 GE Aviation acquired the assets of Morris Technologies, and its sister company, Rapid Quality Manufacturing Rapid Quality Manufacturing, Inc (a) Represents Google search popularity of 3D printing over time (searches done for a particular term, relative to the total number of searches done on Google over time) Source: Wohlers Associates, Google, press articles, Broker research 14

16 2 Sweet spot positioning targeting the most attractive segments Strong and accelerating growth in metal 3D printing Direct parts production has been increasing (New system units sold) Estimated revenue growth significantly higher, as capabilities and prices of units sold have increased Direct parts production as a % of overall 3D Printing market 4% 7% 8% 10% 12% 14% 17% $0.2bn 20% 24% $0.4bn $0.3bn 28% $0.6bn 3D printed direct parts production (US$bn) SLM covers all relevant end markets (Metal 3D printing systems installed by industry worldwide in 2012) Automotive 6% Academic Institutions 13% Others 16% Aerospace 20% Service center 18% Dental 13% Healthcare 14% Source: Wohlers Associates, CODEX Partners, Broker research, Company presentations = SLM Solutions Group end market SLM s target segments represent ca. 84% of total end market 15

17 2 Substantial upside opportunities for SLM Solutions Group 3D metal printing offers most attractive opportunities (Worldwide, in # of systems and m, 2012) Number of units Revenues 7, m Significant upside from developing consumables and service business (Worldwide, in m and %, 2012) All materials Only metal 1,701m 161m 3% (207) Metal 9% 19% 31m Contract manufacturing (job shop) 18% 85m Metal 17% 27m 12% 19m Services (maintenance etc.) Metal sales (material) 97% (7,563) Other 91% 82% 375m Other materials 53% 85m Systems SLM Solutions Group operates in the 3D metal market which is characterised by high value-added printers. Within this market, the Company is focused on printer systems and will develop the consumables business Source: CODEX Partners, Wohlers 16

18 2 3D metal printing with different value proposition compared to plastics Consumer plastic Industrial plastic Industrial metal Customer segments Output example Machines Consumers Professionals (eg architects) SMEs Industrial companies Service bureaus Research institutes Industrial companies Service bureaus Research institutes Industrial application Note: Plastics cover broader range of applications 17

19 2 The power of metal 3D printing vs traditional manufacturing methods Additive Manufacturing + Optimized Part Design Same or superior part properties Higher speed & flexibility Lower total cost of ownership Materials/alloys Prototyping Direct part cost Sizes & shapes Repair Weight Density Lower capex Maintenance Stability Flexible location Part integration Surface No storage cost Eco balance Biocompatibility Material saving Texture Source: Company estimate for illustrative purposes 18

20 3 Powder Bed Fusion technology is most relevant for metal 3D printing Technology Materials Relevance for metal Companies with this technology Powder bed fusion Thermal energy selectively fuses regions of a powder bed Key technologies: Selective Laser Melting, EBM Metals, polymers 81% (a) Arcam AB EOS Concept Laser Renishaw Phenix Systems Metal technologies Directed energy deposition Focused thermal energy is used to fuse materials by melting as the material is deposited Metals Sheet lamination Sheets of material are bonded to form an object Metals, paper TRUMPF Optomec DMG Mori Seiki Mcor Technologies Binder jetting Liquid bonding agent is selectively deposited to join powder material Metals, polymers, foundry sand voxeljet ExOne Material jetting Droplets of build material are selectively deposited Polymers, waxes Material extrusion Material is selectively dispensed through a nozzle or orifice Polymers Others Vat photopolymerization Liquid photopolymer in a vat is selectively cured by light-activated polymerization Photopolymers (a) Powder bed fusion technology accounting for 81% of metal based 3D systems sold as per CODEX Partners analysis Source: ASTM International Committee F42 on Additive Manufacturing Technologies; Roland Berger, CODEX Partners 19

21 3 Selective Laser Melting and EBM are complementary powder bed fusion technologies Selective laser melting Electron beam melting Pitot tube Pitot tube Split of powder bed systems sold (2012): EBM 14% Dental caps Selective Laser Melting 86% Acetabular cups Suited for complex parts and geometries Suited for a broad range of weldable materials, particularly well suited for aluminum, titanium, cobalt chrome, tool steel and nickel based materials Better surface finish Higher resolution Higher build rates but comparable overall processing time due to higher post processing requirements Especially suited for some materials with high melting temperature, e.g. titanium, cobalt chrome Minimize post processing High recycle rate at consumables Note: Split of powder bed systems sold based on CODEX (2012 data) 20

22 3 SLM Solutions Group delivers top quality at high speed Illustrative build-up speed and resolution of selected powder bed fusion systems (a) High Maximum build-up speed in cm³/h EBM Build speed advantage due to multi laser technology Functionality Speed Surface finish Accuracy Performance Low Low Resolution (b) High (a) Based on 2012 Wohlers report (b) Measured by layer thickness Source: CODEX Partners, company estimates 21

23 3 SLM Solutions Group well positioned due to its technological advantages SLM Solutions Group has recently shown high growth Market share expansion (SLM HL systems sold globally p.a.) SLM 250HL/SLM 280HL SLM 125HL SLM 500HL 2 SLM machine ASP ( 000): CAGR: +7% Revenue growth significantly higher driven by average sales price growth due to larger size and capabilities 35% growth based on powder bed systems SLM Solutions' key differentiators Highest build rate in its class due to multi laser technology (a) Patented bi-directional loader movement Automated powder and build part handling Large build chamber size appropriate to address many common product dimensions Open architecture allowing for diverse applications and materials used (a) According to CODEX Partners (b) Based on company estimate, CODEX Partners, Wohlers, broker research (New system units sold) SLM market share (of total metal market) 166 Powder Bed: Total market Powder Bed: 167 SLM Solutions ~4% ~10% ~13% (b) 22

24 3 SLM Solutions Group with powerful multi laser technology Multiple laser SLM Solutions Group early adopter of technology Established SLM technology: Up to 200% Up to 400% Build rate (a) 100% Advanced exposure strategy for overlapping areas Laser beams positioned next to each others in gas stream 2x 400W 2 Scanner SLM 280 HL 4x 400W 4 Scanner SLM 500 HL Monolaser 400W Hull-Core Technology Beam switch patent ~ % (b) Other companies focused on hullcore with single laser ~ % (b) 1x 400W 1x 1000W 1 Scanner SLM 280 HL 2x 400W 2x 1000W 2 Scanner SLM 500 HL (a) Productivity accounted without powder deposition time (b) Productivity depending on number of layers melted with 1000W laser 23

25 4 Excellent IP portfolio and application know-how Excellent proprietary IP portfolio SLM Solutions Group holds a number of key patents, providing an excellent level of protection for its technology Dr. Dieter Schwarze and his team are renowned researchers and developers of the SLM technology. He and his team transferred all rights to the company More than 30 patent applications since 2009; approx. one patent application filed per month in 2013 Extensive process knowhow Strong experience and knowledge Exclusive experience with innovative solutions e.g. laser parameter settings History of technology leadership Research & Development Key targets: Increase efficiency Improve robustness and reliability Reduce total operating risk for customers Selected R&D focus areas: New powder cassette Tailored microstructure production Melt pool temperature monitoring Laser power management and control 24

26 5 SLM Solutions Group has a blue chip customer base and its global reach is expanding SLM Solutions Group is already operating in key industries Selected blue chip customers Aerospace Automotive General Electric Global Research Aviation General Electric Aviation General Electric Energy Healthcare Energy Alstom Siemens BMW Airbus Innovation Works (EADS) NASA SpaceX SLM Solutions Group has exposure to attractive end markets and has longstanding relationships with blue chip customers The market continues the shift from rapid prototyping to industrial applications SLM Solutions Group is well positioned to capitalise on this trend given SLM Solutions' technology and customer base BEGO More than 60 universities and research institutes Polyshape Citim Fruth Source: Company website 25

27 5 with key customers advancing from prototyping to volume production General Electric Jet Engines GE is one of SLM Solutions' largest customers and an important development partner GE makes significant effort in 3D printing Product examples: Fuel nozzles for Jet Engines and Ultrasound Transducers GE has a global team of 600 engineers at 21 sites driving additive manufacturing technologies Operates a full-scale additive manufacturing facility in Ohio SLM Solutions' machines help GE to increase precision and productivity in this field and the company s benefit from a strong partnership GE forecasts to manufacture 100k additive parts for GE Aviation by 2020 GE believes that ~450kg weight reduction per aircraft engine can be achieved through 3D direct manufacturing Source: GE company data 26

28 3 Business model and strategy 27

29 SLM Solutions Group is focused on the core of 3D printing 3 rd party manufacturers Materialise 3D Printing solution providers Software / design libraries Materialise Shapeways Stratasys Proto Labs Stratasys 3D Systems EOS 3D Systems EnvisionTEC ExOne voxeljet Concept Laser 3 Shape NetFabb Arcam Stratasys Service bureaus ExOne 3D Systems Materialise Note: Represents selected 3D printing companies Solution includes primarily systems but also accessories and associated services and consumables and public information voxeljet 28

30 Core SLM business leveraging rapid prototyping experience Rapid Prototyping (Casting) Selective Laser Melting (Metal Printing) Metal casting machines Metal-based 3D printing systems Equipment Vacuum casting Complementary equipment All using Selective Laser Melting Complementary equipment Automation equipment Deep rooted heritage in selling metal-based systems Consumables Metal alloys Resins Nylon Metal powders Other consumables like filter, recoater blades, etc. Experienced in capturing recurring consumables revenues Jobshop Benchmarks Services Small-batch production Prototyping Maintenance of machines Engineering Maintenance of machines Jobshop Service experience helps understand the needs of 3D printing customers Sales 2013A: 4.9m Sales 2013A: 16.6m 23% of total sales 77% of total sales Note: Based on IFRS financials 29

31 We strive to become a global leader in metals based 3D printing for industrial applications Sales force and services network Capitalize on platform expansion to catalyze larger machine sales Develop a global platform with local presence Build sales force exclusively focused on selling our 3D printing solutions Expand sales presence in North America and establish a sales presence in Asia Develop new demo centers to promote brand awareness Focus on expanding service offering pre- and post sales Strengthen offering of service / maintenance contracts and trainings for customers Develop metal powder business Develop metal powder business by adding manufacturing capabilities through acquisitions or partnerships Continued focus on R&D Offer even more productive and excellent solutions to customers Continued investment in R&D especially around developing in-house capabilities and expanding current offerings Further enhancement of IP portfolio Investments in software development to further enhance our solutions applicability and user experience 30

32 Highly attractive business model focused on building the installed base and driving recurring revenue Sale of 3D printers Drive market adoption Installed base of 133 (a)(b) Build installed base Drive recurring revenue R&D Industrial customers Continued innovation Provide materials and services support (a) As per December 2013 (b) Number of machines brought to market via SLM HL: 76 thereof 4 demo machines, via Fockele & Schwarze: 5, via MTT: 6, 46 Realizer machines were brought to market and serviced by SLM Solutions Group 31

33 Further expand global sales, application and service footprint Lübeck, Germany APAC Americas Set up 2 additional sales and service offices in California and the South East Hire 2 more sales and 3 more service and application professionals Hire 1 COO / General Manager Detroit EMEA Expand sales offices in Spain, Italy Hire 2 sales professionals in Italy and Spain Hire professionals and trainees for backup in sales, application and material science in Lübeck Add distribution partners Invest in additional demo centers Establish on site service centers for multiple production machine orders Ability to seize on selected sales and service network acquisitions Setup Singapore subsidiary as a sales, application and service hub in Asia Qualify Japanese distributor with full sales application and service facility Renew agency / distributor in Australia / New Zealand Headquarters US subsidiary Distribution partners 32

34 Reduced unit costs expand SLM Solutions Group s addressable market Illustrative development of cost per part and addressable market Cost per part early machines Cost per part current machines Addressable Market Today Cost Industrial companies for prototyping Industrial companies for volume production Traditional Manufacturing Further reduction of cost per part Complexity Source: Company estimate for illustrative purposes 33

35 4 Operations 34

36 Production capability Production area expanded in July 2013 from 200m 2 to over 600m 2 28 FTE (including 12 purchasing and logistics FTEs) 8 assembly stations with power, gas and water supply Current production area sufficient to produce up to 100 machines p.a. 20 days per machine times 8 assembly stations = 100 machines p.a. (one shift) given 250 working days p.a. Opportunity to improve flow of material (Kanban, SAP, flow assembly) and to reduce cycle time to below 20 working days per machine 8 machines already delivered in December 2013 Each machine is thoroughly tested (including test runs) before shipment Close collaboration with R&D to capture opportunities for cost reduction and reduced cycle times Joint effort between production, logistics and purchasing to implement lean manufacturing concepts, e.g. 5S, CIP manufacturing processes 35

37 Quality management ISO 9001 certified since 1995 Continuous improvement of quality management system 7 new quality procedures and 25 new forms released in 2013 End control of every machine produced Self control by assembly workers Systematic functional test by dedicated end control team Significant reduction of installation effort since introduction in Q4 / 2012 Six sigma initiative recently launched 36

38 Well diversified supplier base SLM segment: top 15 suppliers make up for 68% of total purchasing value in % Sourcing strategy Sourcing of primarily standard off-the-shelf-components, e.g. electrical / pneumatic components, PC Sourcing value % of total (2013) 13% Partnering with local suppliers for special mechanical parts and components Sourcing of high value parts and components (e.g. laser and optical components) from preferred partners Top 15 suppliers Sourcing of complete preassembled modules instead of single parts, e.g. recoater Laser and optical components Other parts and components Licenses Powder Software Note: Selective Laser Melting makes up for more than 75% of the total purchasing value in

39 R&D the backbone of SLM Solutions Group Process Input: voice of customers and other stake holders Close relationships to customers R&D pipeline Recent examples Adapting products to customer needs Collecting feedback from sales, marketing, production and service 12 new technologies Methods / know-how Patent applications Laser power management, melt pool monitoring, Quasi monocrystalline microstructure Ongoing consideration of new technologies 17 new products Innovations Options / upgrades Enhancements / facelifts SLM 500 HL, PSA 500 Twin optics, new recoater SLM 280 HL Resources & organization 12 FTE (or 15% of SLM Solutions Group (a) ) in process, system, materials, SW / electronics and mechanical engineering Additional contracted resources (mechanical engineering, SW and research institutions) Investments in prototypes, equipment and tools 1.6m (b) spent on R&D in 2013 (a) Represents figures as of December 31, 2013 (b) Includes approx. 165k for testing laboratory 38

40 5 Products and intellectual property 39

41 SLM Solutions Group and its predecessors have a history of innovation Basic Research F&S Stereolithography GmbH, Trumpf GmbH and Fraunhofer Institute for Laser Technology (ILT) Fockele & Schwarze (F&S) research leading to IP with today more than 30 own patents and applications 2002 F&S/SLM Solutions (a) partner to develop, produce and market the SLM Technology to industrial requirements 2003 Launch of first Fibre Laser technology with the MCP SLM Launch of SLM 100 as an entry model 2007 Launch of the 400 Watt technology 2009 Launch of the new SLM 250 HL World Wide cross license agreement with Trumpf, EOS and Fraunhofer ILT 2011 Launch of SLM 125 HL and SLM 280 HL with hull and core (400W & 1000W) technology and 3D laser technology 2012 Introduction of SLM 500 HL and the multi laser technology 2013 Launch of SLM 500 HL with additional automated powder handling devices (a) In 2002 SLM Solutions Group was known as MCP. MCP changed its name to MTT Technologies Group in MTT Technologies GmbH, Lübeck was renamed into SLM Solutions GmbH in

42 and created a technology leader in metal 3D printing with a differentiated solution Key technological highlights and USPs Highest build rate in its class due to multi laser technology and 3D optics. Laser options: - Twin laser technology: 2x 400 Watt lasers - Quadruple laser technology: 4x 400 Watt lasers - Hull & core double laser technology: two sets of 1x1000 Watt + 1x400 Watt lasers each Patented bi-directional loader movement Closed loop powder cycle Layer control system (LCS) Automated exchangeable build chamber to allow for continuous machine usage Open architecture allowing for diverse applications and materials used Latest generation turbine blades Titanium Hip Implant Impeller Comparable density, resistance and accuracy of cast components 41

43 Excellent IP portfolio and clear R&D roadmap High tech ecosystem Long-term relationships with universities and R&D institutes Shared projects create synergies for innovation Feedback from other clients also translates into future improvements Excellent IP position SLM Solutions Group holds a number of key patents, providing an excellent level of protection for its technology Strong brand attracts engineering talent Strong R&D investment Continued R&D spending Hiring of human capital key focus Excellent track record of R&D department Dr. Dieter Schwarze and his team are renowned researchers and developers of the SLM technology. He and his team transferred all rights to the company History of innovation At the fore front of the industry for certain key milestones: Multi laser strategies Automated powder handling 3D optics Bi-directional loader movement Automated exchangeable build chamber More than 30 patent applications since 2009; approx. one patent application filed per month in

44 R&D focus areas Enlarged build envelope Higher build rate faster recoating & multilaser Robustness 24/7 New powder cassette Tailored microstructure production Functionality Speed Surface finish Accuracy Performance Melt pool temperature monitoring Laser power management and control Process monitoring & control Optimized powder and build part handling Data management storage & export User friendliness Easy maintenance Cost of machine and associated peripherals Standardization, modularization and flexible customization Remote operation and service 43

45 Selected relevant R&D focus areas New powder cassette (powder conveyor/container) Tailored microstructure production (quasi single crystalline) Higher operating speed Weight reduction more than 60% Operable under higher temperature Strengthens part robustness for high temperature applications eg turbine blades Quasi single crystalline structure Requires correct parameters (power, speed, layer thickness, beam diameter) to be used with 1000W laser 44

46 Selected relevant R&D focus areas (continued) Process monitoring and control Laser power management and control Real time heat map Improved real time laser power monitoring Monitoring of melt pool temperature for quality assurance Improved quality assurance Start End 45

47 SLM Solutions Group s technology covers the most relevant metals... Aluminium Cobalt-Chrome Inconel Titanium Tool Steel and Stainless Steel Material Properties Light weight Good alloying properties Good processability (casting and pressing etc) Good electrical conductivity High toughness High strength Good bio-compatibility Good corrosion resistance High corrosion resistance Excellent mech.strength High creep rupture strength up to 700 C Outstanding weldability High strength, low weight High corrosion resistance Good bio-compatibility Low thermal expansion Good machinability High hardness and toughness High corrosion resistance Good machinability Applications Alloys Aerospace Automotive General industrial applications AlSi12 AlSi10Mg AlSi7Mg AlSi9Cu3 AlMg4,5Mn0,4 Other Materials on request Dental Medical implants High temperature Aerospace Gas turbines Rocket motors Nuclear reactors Pumps Turbo pump seals Tooling Co212-f acc to ASTM F75 Inconel 625 Inconel 718 Inconel HX (2.4665) Bio-material for implants Aerospace F1 motor sport Maritime applications Pure titanium Ti6Al7Nb Ti6Al4V Grade X materials on request Plastic injection and pressure diecasting moulds Medical implants Cutlery and kitchenware Maritime Spindles and screws (316L) (H 13) (15-5PH) Other Materials on request Propeller for racing boats as scaled model for flow measurements Dental caps and crowns in cobalt-chrome Turbine blade of latest generation with internal conformal cooling channels to improve performance of jet engines Individual Hip Implant in Titanium made for an Australian patient Mould inserts with integrated, surface conformal cooling channels. Photo with kind permission of Gardena AG 46

48 ...with a diverse and competitive product portfolio SLM produces excellent metal printers based on powder bed fusion technology SLM 125 HL SLM 280 HL SLM 500 HL Key differentiators vs. direct competition include multilaser systems and quality of output SLM systems 125 x 125 x 75mm chamber Entry level tool able to handle broad range of metal components 280 x 280 x 350mm chamber Multi laser technology 500 x 280 x 325mm chamber Automates the management of powder and eliminates manual handling of loads Multi laser technology Functionality Max. build speed 15 ccm / h 35 ccm / h 70 ccm / h Speed Surface finish Units sold 13E (a) 5 19 SLM 280 HL 2 SLM 250 HL 2 (launch in Dec-13) Accuracy Performance Other/ additional products PSM 100 PSH 100 PSX Powder recovery for each system for emptying the process chamber and refilling the powder container (a) Invoiced machines 47

49 Next step: Integrating SLM machines into complex production processes Example: PSX automated powder handling Inert atmosphere Safe powder handling Short processing times Closed-loop powder cycle Automatic sieving and feeding PSA 500 prototype fully automated powder handling Example: Process set up Schematic of process enhancing integration 48

50 6 Financial overview 49

51 Attractive financial profile and outlook Attractive sales growth 35% CAGR achieved between on group level 99% CAGR achieved between in the SLM Segment Stable and increasing margin profile Strong and growing adj. EBITDA margin in the range from approx % from on group level Strong and growing EBITDA margin of 14% achieved in 2013 in the SLM segment Asset light business model Tangible asset light business model with low ongoing capex requirement Strong order pipeline Currently in discussions with potential customers for a total of 133 SLM machines Outlook Positive outlook on key metrics for 2014 and beyond 50

52 Strong revenue, adjusted EBITDA and margin growth Revenue Adjusted EBITDA (a) Adj. EBITDA (a) (% of revenue) in m in m in % 35% p.a. 45% p.a % 11.5% % A 2012A 2013A SLM segment RP segment Other / consolidation 2011A 2012A 2013A 2011A 2012A 2013A Strong revenue growth achieved with 35% growth p.a. 77% of revenue in 2013 generated by SLM segment vs. 23% in RP segment Revenue increase generated from organic growth only Adjusted EBITDA grew by 45% p.a. and thus even higher than revenue as economies of scale start to be realized and a mix in products is shifted towards SLM 500 HL Unadjusted EBITDA of 2.3m in SLM segment and 0.2m in RP segment (bridge effects of - 0.4m) in 2013 Note: Based on IFRS financials Figures for 2011 and 2012 based on SLM Solutions GmbH and for 2013 based on SLM Solutions Holding GmbH. (a) EBITDA adjusted for one-off costs related to financing, one-off costs related to IPO and other non-recurring costs (unaudited). Increasing margin 51

53 Operating expenses primarily related to raw materials and consumables used Adjusted operating expenses as % of total output Comments 13.3% 23.3% 54.0% 16.2% 16.9% 19.5% 20.8% 54.1% 51.2% Raw materials and consumables used are the largest individual cost position Continued potential to decrease raw material costs given economies of scale from higher purchasing volumes and less expenses related to the prototype of the SLM 500 HL as it is entering series production Share of personnel costs relatively stable over the observed period Share of other operating expenses is increasing over the observed period, particularly given an increase of the overall organization and setup 2011A 2012A 2013A SLM Solutions GmbH SLM Solutions GmbH SLM Solutions Holding GmbH Other operating expense (net of other operating income) Personnel costs Raw materials and consumables used Note: Based on IFRS financials Total output includes revenue, changes in inventories and internally produced and capitalized development costs Based on adjusted costs. Other operating expenses 2013A adjusted for one-off costs related to financing ( 0.2m) and one-off costs related to IPO ( 0.1m) and personnel costs in 2013A adjusted for other non-recurring costs ( 0.1m) 52

54 Strong balance sheet and tangible asset light business Balance sheet SLM Solutions Holding GmbH Comments 35.6m 35.6m Strong capitalisation with 14.7m equity (approx. 41% of total liabilities and equity) per December % 41% Solid cash position with cash and cash equivalents of 2.4m per December 2013 and undrawn credit lines of up to 3m 6% 53% 7% 2013A Assets 28% 9% 22% 2013A Equity & Liabilities Financial liabilities of 8.0m per December 2013 attributable to a shareholder loan by Parcom Deutschland I GmbH & Co. KG; amount converted into capital reserves in Q Tangible asset light financial model with only 2.1m (approx. 6% of total assets) per December 2013 Intangible assets of 19.0m (approx. 53% of assets) per December 2013, thereof the vast majority attributable to PPA effects of 17.6m Others (particularly trade receivables and inventories etc.) Tangible assets Intangible assets Cash and cash equivalents Equity Other liabilities Pension plans and similar commitments Financial liabilities Note: Based on IFRS financials 53

55 Trade working capital at year end driven by a strong Q4 low capex before one-time effects Trade working capital overview in m 30.2% 35.6% (a) 43.7% 9.8 Comments Trade receivables driven by strong Q4 sales that lead to high trade receivables at year end Shortening of production lead times is secured by inventory Prototype production of new SLM 500 HL also caused an increase in inventory in A 2012A 2013A SLM Solutions GmbH SLM Solutions Holding GmbH SLM Solutions Holding GmbH Trade receivables Inventories Trade payables Total trade working capital as % of total output Capex overview in m 0.4% 0.9% % 1.9 Comments Increase in capex in 2013 primarily driven by activated development costs, the expansion of the production facility in Luebeck, the set up of a consumables testing laboratory in Luebeck and a demo center in the USA 2011A 2012A 2013A SLM Solutions GmbH Capex SLM Solutions GmbH Capex as % of total output SLM Solutions Holding GmbH Generally low capex requirement observed historically Note: Based on IFRS financials Total output includes revenue, changes in inventories and internally produced and capitalized development costs (a) Based on total output in 2012A of SLM Solutions GmbH 54

56 Seasonality of business Q4 generally the strongest in terms of revenue Quarterly revenue distribution as % of total respective yearly revenue 50% 45% Comments Quarterly revenue pattern shows seasonality, which is driven by various effects such as budget spending of clients at year end and an important trade fair (Euromold) in Q4 40% 35% 30% 25% 20% 24% 23% 38% Q1 typically is the weakest quarter; Q4 generally is the strongest quarter, accounting for approx % of total revenue recorded in the respective year It is expected that the revenue development throughout the year will continue to show a seasonal pattern going forward 15% 15% 10% 5% 0% Q1 Q2 Q3 Q4 Note: The numbers in this graph are not audited and are derived solely from our internal accounting records, which are in accordance with the German Commercial Code ( HGB ). Deviations of the numbers shown in this graph from sales numbers determined, or to be published, in accordance with IFRS for the first, second, third and / or fourth quarter of the years 2011, 2012 and / or 2013 are likely, in particular due to different methods used for accruals. Historical seasonality is no guaranty of similar seasonal patterns in the future. Investors should not rely on our past results as an indication of our future performance. Midpoint based on average derived from internal reporting for the years 2011, 2012 and 2013; revenue recognition based on date of invoice 55

57 Considerations on taxes and pensions Tax considerations German statutory tax rate relevant for SLM Solutions Holding GmbH: approx. 31% (15% for corporate income tax, 15% for trade tax purposes) SLM Solutions Holding GmbH may benefit from tax loss carry forwards in Germany reducing the effective tax rate Expected effective tax rate of SLM Solutions Holding GmbH (current income taxes + deferred taxes): approx. 30% Pension liabilities As per 2013, SLM Solutions Holding GmbH is expected to have a approx. 3.1m pension and similar commitment deficit Net pension costs amounted to approx. 0.2m in 2013 ( 0.1m service costs, 0.1m interest costs) Note: Based on IFRS financials 56

58 IPO proceeds finance our clearly defined strategy 1 Capitalize on platform expansion to catalyze larger machine sales Develop a global platform with local presence Strengthening of sales force and services network Build sales force exclusively focused on selling our 3D printing solutions Expand sales presence in North America and establish a sales presence in Asia Develop new demo centers to promote brand awareness Focus on expanding service offering pre- and post sales Strengthen offering of service / maintenance contracts and trainings for customers IPO proceeds 2 Develop consumables business Develop metal powder business by adding manufacturing capabilities through acquisitions or partnerships 3 Continued focus on R&D Offer even more productive and excellent solutions to customers Continued investment in R&D especially around developing in-house capabilities and expanding current offerings Further enhancement of IP portfolio Investments in software development to further enhance our solutions applicability and user experience Financing of working capital Financing of the 3 initiatives and growth leads to increase in working capital requirements 57

59 Strong sales pipeline in place SLM machine split in 2013 vs. current pipeline (per Feb-14) Comments # of machines % 13% 102 (a) Strong pipeline in place that already today reflects a shift towards the SLM 500 HL machine 75% (a) 77% 14 18% 11% SLM machine pipeline (per Feb-14) (a) 2013 Current pipeline SLM 500 HL SLM 280 HL SLM 125 HL SLM 125 SLM 280 # of machines (1) SLM 500 HL HL HL Total 133 Pipeline contains 17 SLM 500 HL machines, constituting approx. 13% of the total pipeline already as per February 2014 vs. approx. 7% in 2013 Currently in discussions with potential customers for a total of 133 SLM machines Pipeline of 133 machines equals currently installed base Lead / first offer Serious offer stage Benchmark ordered Positive feedback on benchmark Verbal confirmation Won Total Note: All machines with expected delivery in 2014 (a) Includes also a few units of the old SLM 250 machines 58

60 Management outlook positive on all key metrics 2013A Comments Outlook Revenue Revenue: 21.6m Continued growth expected given our strong order pipeline and given shipments of the SLM 500 HL which is entering series production Benefits from expansion of our sales network already visible EBITDA EBIT Adjusted EBITDA (a) : 2.5m (margin of 11.5%) Adjusted EBIT (a) : 1.9m (margin of 8.8%) Scale benefits from higher number of machines and increased purchasing volumes EBITDA margin in line with competitors Net income Adjusted net income (b) : 1.0m Benefits from EBITDA development expected to flow through to net income No external financing post the IPO expected Potential benefits from tax loss carry forwards Note: Based on IFRS financials (a) EBITDA and EBIT adjusted for one-off costs related to financing, one-off costs related to IPO and other non-recurring costs (b) Net income adjusted for one-off costs related to financing, one-off costs related to IPO, other non-recurring costs and PPA related deferred taxes 59

61 7 Summary 60

62 SLM Solutions Group a leader in metal 3D printing 1 Massive market potential 3D Printing: Massive addressable market nearing inflection point with a long runway for growth 2 Superior positioning Sweet spot positioning in the 3D printing industry targeting the most attractive segments 3 A technology leader A leader in 3D metal printing market with excellent technology and differentiated solution 4 Barriers to entry Excellent IP portfolio and application know-how 5 Proven technology Diverse and growing blue chip customer base 61

63 Appendix Financials 62

64 Adjustments relate to acquisitions effects impacting 2013 financials Adjustment bridge in m SLM Solutions Holding GmbH 2013A Reported EBITDA 2.1 One-off costs related to financing 0.2 One-off costs related to IPO 0.1 One-off other non-recurring costs 0.1 Comments Adjustments include the following items: 1 2 One-off costs related to financing result from the stake acquired by Parcom Deutschland I GmbH & Co. KG for structuring of financing One-off costs related IPO are mainly audit related and related to the transition of IFRS accounting standards Adjusted EBITDA 2.5 Depreciation and amortization expense -0.6 Adjusted EBIT 1.9 Interest expense Other one-off non-recurring costs related to the board formation PPA related deferred taxes 4 Income taxes 0.2 Deferred tax relating to PPA -0.5 Adjusted net income 1.0 Adjusted EBITDA, adjusted EBIT and adjusted net income are proxies for the financial performance in the absence of any acquisition / transaction related effects Note: Based on IFRS financials 63

65 Seasonality of business Quarterly distribution of machine sales Quarterly shipment of machines and equivalent value Comments Number of machines shipped In 2012, the number of machines shipped increased gradually from Q1 to Q4 m 7.6 The average selling prices increased due to a shift towards more SLM 280 HL being sold towards the end of the year 4.9 In 2013, the number of machines sold from Q1-Q3 was relatively stable and increased significantly in Q Q1 Q2 Q3 Q4 The average selling prices from Q1-Q3 varied significantly due to the sales mix The average selling prices were highest in Q4 as the majority of machines sold were SLM 280 HL and due to the introduction of the SLM 500 HL Historically relatively low predictability of quarterly distribution of machine sales Note: Numbers represent only machine numbers and equivalent shipping value and can therefore differ from quarterly reporting going forward. This information is derived from internal accounting records for the years 2012 and The numbers are not audited and are derived solely from our internal accounting records. Deviations from numbers published for the first, second, third or fourth quarter in 2013 are possible due to different methods used for accruals. Historical seasonality is no guaranty of similar seasonal patterns in the future. Investors should not rely on our past results as an indication of our future performance derived from internal reporting for the years 2012 and 2013; numbers are unaudited; revenue recognition based on shipment date 64

66 Income statement SLM Solutions GmbH SLM Solutions GmbH SLM Solutions Holding GmbH in m 2011A 2012A 2013A CAGR Revenue % growth (%) 46.7% 23.2% Changes in inventories Internally produced and capitalized development costs Total output % Raw materials and consumables used Gross profit % Gross profit margin (% of revenue) 49.2% 49.9% 50.6% Personnel costs Other operating income Other operating expense EBITDA % Adjusted EBITDA % Adjusted EBITDA margin (% of revenue) 10.0% 11.1% 11.5% Depreciation & amortization expense Amortization PPA related Operating result (EBIT) n.m. Adjusted Operating result (EBIT) % Adjusted EBIT margin (% of revenue) 7.0% 8.6% 8.8% Interest income Interest expense Income before income taxes (EBT) EBT margin (% of revenue) 5.1% 7.1% -2.8% Income taxes Net income n.m. Adjusted net income % Adjusted net income margin (% of revenue) 3.6% 5.2% 4.7% Note: Based on IFRS financials 65

67 Information regarding changes in the reporting entities and acquisition effects Description SLM Solutions Holding GmbH, predecessor of the listing entity SLM Solutions Group AG (in the course of formation), has acquired SLM Solutions GmbH, the operating business, with financial effect at the end of 2012 SLM Solutions Group AG (in the course of formation) holds 100% in SLM Solutions GmbH, which is the only subsidiary of SLM Solutions Holding GmbH SLM Solutions GmbH consolidated financial statements based on IFRS for 2012 for all figures shown, except for balance sheet data, with comparative figures for 2011, with both years being audited Structure SLM Solutions Group AG 100% SLM Solutions GmbH 100% SLM Solutions NA Inc. (a) In addition, SLM Solutions Holding GmbH consolidated financial statements based on IFRS are shown for 2013 for all figures and 2012 for balance sheet data, with both years being audited Due to the acquisition of SLM Solutions GmbH at the end of 2012, the figures shown for SLM Solutions Holding GmbH are impacted by effects related to the Purchase Price Allocation ( PPA ) (a) In the course of formation. 66