Financial Services. Facts & Figures siemens.com/finance

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1 Financial Services Facts & Figures 2015 finance

2 Introduction The Siemens Financial Services Division (SFS) provides business-to-business financial solutions. Aligning ourselves with the growth fields of electrification, automation and digitalization, we support customer investments with leasing solutions and equipment, project and structured financing. We provide capital for Siemens customers as well as external companies and serve as an expert advisor for financial risks within Siemens. Our financial and industry know-how creates customer value and enhances customer competitiveness while building trust in new technologies and facilitating their market launch. We know our customers markets from years of firsthand experience gained as a part of Siemens. This means we can create solutions that help our customers become more successful in their markets. We are uniquely placed to understand risk, enable opportunity and support long-term business performance. Our people, our engineering heritage and our financial expertise allow growth to happen in new ways. Roland Chalons-Browne CEO of Siemens Financial Services 2 3

3 Financial Services at a glance Combining engineering and financing excellence. A competitive edge for Siemens. Financial Services business performance Financing solutions: Equity participations demonstrate commitment to our technology Financial solidity, structuring and risk expertise support infrastructure projects Total assets 1 [in billions of ] Integrated technology and financing solutions enable new business models Fiscal Year Prudent risk management and a well diversified portfolio with close Siemens proximity Allocated equity 1 [in millions of ] 1,459 1,593 1,790 1,938 2,148 Income before income taxes, IBIT [in millions of ] Employees 2,082 2,604 2,916 3,007 3,140 1 At end of fiscal year 2 October 1 to September 30 SFS one Division of Siemens Siemens AG Divisions Power and Gas Wind Power and Renewables Power Generation Services Energy Management Building Technologies Mobility Digital Factory Process Industries and Drives Healthcare [separately managed business] Financial Services Power generation Power transmission, power distribution and smart grid Energy application Imaging and in-vitro diagnostics We create value for Siemens by enabling new technology models through our financial expertise 4 5

4 Global presence Employing more than 3,000 people globally, SFS provides capital for Siemens as well as for other organizations across the world. Europe, Africa, Middle East, CIS [Total assets 2, in billions of ] North and South America [Total assets 2, in billions of ] Asia, Australia [Total assets 2, in billions of ] 1 As of September 30, Changed reporting methodology: Until 09/2013 assets reported according to the booking entity. Since 10/2013 assets reported according to the customer domiciles. 6 7

5 Did you know? Customer Example Infrastructure finance SFS has more than 200,000 customers in 55 countries More than 3,100 experts work worldwide for SFS European Locomotive Leasing, Germany /Austria We have more than 25,000 healthcare assets in our portfolio Technology and financing simply go hand in hand at Siemens and it has been that way for more than 150 years now Electrification 1887 Foundation of Siemens lighting company in St. Petersburg and beginning of infrastructure financing in Russia Digitalization We finance more than 4,000 software projects In our portfolio we have financing volumes from 1,000 to over 1,000,000, Siemens developed and financed the first elevated and underground railway in Berlin Financing for European Locomotive Leasing European Locomotive Leasing (ELL) is a provider of full-service locomotive leasing solutions to freight and passenger operators throughout continental Europe. With rail traffic liberalization across the continent and the growing prominence of private rail operators more likely to favor leasing over owning locomotives, the locomotive leasing sector benefits from highly attractive market dynamics. The business outlook is set on expansion which is why ELL signed a framework agreement for up to 50 Vectron locomotives from Siemens, with financing secured inter alia by SFS. Christoph Katzensteiner, founder and CEO of ELL: The versatile Vectron locomotives are particularly well suited to the European market and are proving to be very popular with our lessees. 6,400 [kwh] maximum output rating Several consignments of Vectron locomotives have already been ordered, and the first locomotives went operational for ELL customers in July Locomotive leasing is a capital-intensive business. ELL at that point still in a dynamic start-up phase envisaged an extremely short timeframe to close the deal, especially for any debt provider to familiarize themselves with the under lying asset values and challenges of the entire business model. This is where Siemens in-house financial expertise came into play. This major order was secured thanks to an 8-year asset-based Senior Term Loan Financing of million set up by SFS based on SFS expertise of managing and evaluating rolling stock assets. The loan is mutually provided by SFS and DVB Bank SE. Furthermore, the equity sponsor is the global investment firm Kohlberg Kravis Roberts (KKR). 8 9

6 Customer Example Energy finance Customer Example Healthcare finance The Gemini Project, Netherlands Siemens provides 150 wind turbines for largest Dutch offshore project Changchun Orthopedics Hospital, China 100 [million, SFS equity investment] 60 % Northland Power 20 % Siemens Financial Services 10 % HVC 10 % Van Oord The Gemini wind power plant will be located in the North Sea, 85 km off the Dutch coast of Groningen. With a total installed capacity of 600 MW Gemini will yield 2.6 terawatt hours (TWh) of electricity per year. The wind power plant with 150 Siemens wind turbines will supply clean energy for one and a half million people after being fully commissioned. Financial Services contributed to securing the Siemens bid by participating in the Gemini consortium via an equity investment of 20 percent (around 100 million). The multi-source financing model used in the project can help meet the increased capital investment required to finance the next stage in the offshore wind market s development. The winning combination of technological innovation and tailored financial solution has helped to secure the largest order for Siemens Power Generation Services to date. Long-term support for hospital expansion Changchun Orthopedics Hospital needed new, more advanced equipment to meet the demands of a rising number of patients. The hospital was already investing heavily in the development of several branches in different locations and required financing to underpin its expansion plans. With a lease from Siemens, I receive everything from a single source covering both equipment and the financing. That is why I would like to continue working with Siemens and Siemens Financial Services in the future. Chen Wei, Director at Changchun Orthopedics Hospital with SFS in the past, it once again turned to its long-standing financing partner for support. As a result, SFS designed a five-year leasing solution tailored to the hospital s requirements and development plans. The financing agreement aligned expected income generated by the use of the new equipment with financing payments so the arrangement was in effect selffinancing. The private clinic particularly wanted to expand its diagnostic imaging equipment through the acquisition of two computed tomographs, a magnetic resonance tomograph and three x-ray units, worth a total of CNY 15 million (approx. 1.8 million). Since the hospital had already leased equipment Over the years SFS in China has established a long-term partnership with the hospital. The financial solutions have helped to complete several expansion projects, improving its capacity to provide quality healthcare to the local population

7 Customer Example Venture Capital & Private Equity Customer Example Industry finance AK Steel, USA Customer Focused Solutions for AK Steel AK Steel is a leading producer of flatrolled carbon, stainless and electrical steel products with headquarters in the Greater Cincinnati area. The corporate venture capital organization of Siemens invests in early-stage technology companies, established growth companies and offers asset management services for private equity and venture capital fund portfolios. The aim is to identify innovative solutions from which Siemens can profit, especially in the growth markets of digitalization, electrification and automation. To date, the company has invested more than 800 million and in over 170 companies worldwide. Following are some selected examples of the portfolio: 800 [million invested] Siemens Financial Services has invested in over 170 companies worldwide. 100 [million US$] Siemens Financial Services committed US$ 100 million in a multi-lender ABL revolver. It was unique to have a member of the syndicate that wasn t a financial bank it brought a personalized and fresh angle to the relationship. Roger Newport, Chief Financial Officer 12 AK Steel was seeking to increase operational flexibility, obtain cost-based synergies, enhance its earnings and reduce constraints to better serve customers. As one of North America s premier steel manufacturers, the company is focused on expanding its production capabilities and developing new products to meet their customers needs. Acquiring Severstal s Dearborn operations provides opportunities for AK Steel to further grow with its customers, including automotive customers, and advance AK Steel s strong position within the steel industry. Siemens Financial Services committed US$100 million in the US$1.5 billion multilender ABL revolver to help facilitate AK Steel s acquisition of the Severstal Dearborn facility. As a result, AK Steel increased its shipment capabilities by over 40 %. PE INTERNATIONAL was founded in 1991 and today is the international market leader in software solutions, stra tegic and expert services in the field of sustainability management. Augmate has a platform as a service that creates digital eyewear applications for the desk-less worker. They provide the essential building blocks necessary for customizable and scalable business efficiency solutions. ChargePoint is the largest and most open electric vehicle charging network in the world, with more than 20,000 charging locations. Bayeco is an industrial air pollution control solution provider focusing on industrial volatile organic compound abatement and vapor recovery systems, e. g. for refineries or gas stations. 13

8 Financial Services Products & Solutions Our financial products reflect the needs and expectations of our customers both inside and outside Siemens. Equipment Finance & Leasing Vendor Finance Financial Advisory & Structuring Equity Investments Debt Financing Leveraged Finance Working Capital Finance Venture Capital & Private Equity Trade Finance Advisory Treasury Insurance Solutions Private Finance Solutions Pension Management Investment Management & Services 14 15

9 Equipment Finance & Leasing Financial Advisory & Structuring leasing We offer a comprehensive range of equipment finance and leasing solutions to organizations of all sizes requiring financing for equipment from Siemens or third-party providers. Our customers range from large and medium-sized companies, international corporations, municipalities and public-sector entities to small, privately owned businesses. Our innovative portfolio of products and services comprises various financing options such as finance lease, operating lease, hire purchase, rental, loans and software financing as well as managed services. We also offer our customers flexible, usage-based financing for their equipment investments, such as pay-per-use programs. Our services cover the management of financed assets as well as end-of-term issues, including logistics, equipment servicing and remarketing. financial-advisory We act as a financial adviser to Siemens businesses and we structure, arrange and im plement financing for Siemens customers worldwide. Specifically, we review alternative financing solutions and risk-mitigation concepts for projects. We are typically engaged in the early stages of project development in order to ensure financial aspects are taken into consideration from day one. We develop solutions on behalf of Siemens that balance the requirements of the project participants, meaning customers, suppliers and capital providers. We have created and greatly benefit from our well- and long-established relationships with members of the global financial community in order to realize projects. Vendor Finance vendor-finance We support the business-finance needs of national and international manufacturers, vendors and channel sales partners with vendor financing programs. Our specialized financing solutions are tailored to suit individual vendors and their markets. Our aim is to ensure that businesses have the sales financing tools needed to drive sales and improve their competitiveness. We combine specialized vendor financing knowledge with vendor-oriented processes and products to deliver an expert, performance-focused service. Equity Investments equity Jointly with our partners, we invest in promising infrastructure projects across a variety of industries worldwide. We focus on projects in which Siemens plays a key technological role in construction, operation or maintenance usually as a general contractor or supplier of core components. We support projects that promise an appropriate return in terms of the project s risk profile, which means having to consider country and market risks and project specifics such as construction and operating risks

10 Debt Financing Working Capital Finance debt Leveraged Finance Our structured financing solutions combine in-depth industry know-how and financial expertise. We provide tailored solutions for Healthcare finance, Energy finance, Industry finance and Infrastructure finance covering both the public and private sectors. The spectrum of our solutions ranges from senior secured loans to mezzanine debt and from structured asset financing to various forms of project financing including different procurement schemes. Offered worldwide, our structured finance solutions are tailored to the individual needs of our customers and help them enhance their competitiveness and exploit growth opportunities. working-capitalfinance Our working capital finance solutions are designed to help our clients manage their cash flow through revolving lines of credit, term loans and trade finance facilities. Our solutions are offered mainly to customers in the United States, Canada, the United Kingdom and Australia. Asset-Based Lending Asset-Based Lending (ABL) is a specialized loan product that provides fully collateralized credit facilities to borrowers with high financial leverage and marginal cash flows. Trade finance Our trades payables program in the United States increases cash flow and significantly reduces our clients days sales outstanding (DSO) by offering immediate payment of approved invoices at a competitive cost of capital. leveraged-finance We have the flexibility to meet the challenges of today s complex lending environment. With our leveraged finance solutions, we provide our global private-equity and corporate clients with cash-flow loans to help support their needs and strategic goals. With a deep understanding of leveraged lending, we offer financing solutions for leveraged buyouts, follow-on acquisitions, expansion capital, mergers and recapitalization. We provide a wide array of financing products to address our clients needs, including senior debt as well as structured products and equity co-investments. Venture Capital & Private Equity venturecapital We invest in emerging technology companies. In this way, we supply Siemens with innovative solutions and play a key role in Siemens global innovation network. We offer asset management services for private equity fund portfolio building. Our goal is to identify and finance emerging innovative companies worldwide during the start-up phase (venture capital) and to provide established companies with additional capital for their growth plans during the expansion phase (growth capital)

11 Trade Finance Advisory In our capacity as a center of competence with global functional leadership responsibility for the trade finance business, we advise Siemens entities on all matters concerned with letters of credit, guarantees and sureties. Insurance Solutions We support Siemens and selected third-party companies as a competent partner for all aspects relating to the management of insurable risks, including their transfer to the insurance and financial markets. tradefinanceadvisory Within the scope of our governance duties for the Siemens Group, we act exclusively as an internal service provider for Siemens AG as well as for all Siemens Group affiliates worldwide. We provide individual risk management consulting services and tailor-made insurance solutions to our clients, which have proven their worth on many occasions both inside and outside Siemens. Treasury industrialinsurance Our portfolio covers a wide range of services, from qualified risk analyses to implementing global industrial insurance solutions and hand - ling claims. treasury-solutions On behalf of Siemens, we act as a center of expertise for all aspects of financial risk management, Company financing and payment transactions. We concentrate Company-wide liquidity on a daily basis, effect global internal and external payment transactions, optimize financial risks and manage the treasury-related processes and activities of Siemens. Private Finance Solutions We provide a comprehensive portfolio of attractive and high-quality financial services products in the fields of insurance, retirement planning and residential mortgage financing for employees and retirees of Siemens (and their dependents) and for employees of unaffiliated companies in Germany. siemens.de/spf [user name: spf password: Vorsorge!] We offer our customers the following benefits: Quality-checked offers Products exclusively from recognized providers Attractive conditions and favorable premiums with group discounts Professional advisory services and customer support at three Siemens locations in Germany 20 21

12 Pension Management Equipment Finance and Leasing contacts pension-management Corporate Pensions has the financial responsibility for the Company-wide pension management. Its responsibilities range from the definition and review of the strategy, to risk management and consolidation of Siemens pension accounts. This also includes the global coordination of pension topics for Siemens M&A activities. Furthermore Corporate Pensions holds the governance function for global pension management, as defined in the Corporate Pension Policy. China Phone siemens.com.cn/finance Denmark Phone siemens.dk/finance Finland Phone siemens.fi/finance France Phone [email protected] siemens.fr/finance Poland Phone [email protected] siemens.pl/leasing Russia Phone [email protected] siemens.ru/finance Spain Phone [email protected] siemens.es/renting Sweden Phone [email protected] siemens.se/finance Investment Management & Services We are a provider of a high quality asset management and exclusive services. We offer: asset management with a systematic, quantitative investment process, customized fund solutions (AIF), a variety of mutual funds (OGAW), over 20 years of experience with occupational pension schemes, a broad service approach e. g. as masterservice-kvg with a strong focus on new regulations. Germany Phone [email protected] siemens.de/leasing India Phone [email protected] siemens.co.in/finance Norway Phone [email protected] siemens.no/finance Project and Structured Finance contacts Project and Structured Finance Power, Oil & Gas Phone [email protected] energy-finance Turkey Phone [email protected] siemens.com.tr/leasing United Kingdom Phone [email protected] siemens.co.uk/ financialservices United States Phone [email protected] usa.finance Project and Structured Finance Healthcare and Leveraged Finance Phone [email protected] healthcare-finance investment Aside from Siemens AG and its subsidiaries, our customers include well-known corporations, insurers, banks, foundations and private investors. Project and Structured Finance Energy Management, Mobility and Industries Phone [email protected] industry-finance [email protected] leveraged-finance SFS Headquarter contact Phone [email protected] finance 22 23

13 This brochure contains only general, nonbinding information. Its contents are based on information available at the time of publication and can change at any time without prior notice. The contents of this brochure in no way represent an offer to conclude a contract. All products and solutions offered in this brochure are subject to the legal requirements of the respective country Siemens Financial Services GmbH Publisher: Siemens Financial Services GmbH Strategic Development (SD) Munich, Germany Phone [email protected] Status (unless stated otherwise): December 31, 2014 As of 2007, all figures based on IFRS (until 2006: U.S. GAAP) Order No. L1-Z 1001 finance Follow us! linkedin.com/company/ siemens-financial-services twitter.com/siemens_sfs fb.com/siemensfinancialservices