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7 March 2017

ANNUAL RESULTS 2016

| Annual Results 2016 | 07-03-2017 2

INHOUD

1 About TKH Group

2 Developments 2016

3 Notes to the results and balance sheet 2016

4 Strategic developments & outlook

5 Annex

| Annual Results 2016 | 07-03-2017 3

2016

Netherlands 19

Europe (other) 45

Asia 20

North America 13

Other 3

PROFILE

Turnover € 1.3 billion

Number of employees (FTE) 5,509

Technology company

Four core technologies

Vision & security, communication, connectivity and

manufacturing systems

The core technologies are combined with software and system

integration into total solutions in vertical focus and growth markets

within three business segments:

Telecom Solutions 13%

Building Solutions 43%

Industrial Solutions 44%

Geographical

distribution of turnover (in %)

| Annual Results 2016 | 07-03-2017 4

MISSION

TKH intends to be an innovative and leading technology (niche) player by creating combinations of it’s

four core technologies to total solutions that lead to larger efficiency, more comfort and larger safety for

customers. By offering ‘best in class’-solutions, TKH aims to continuously exceed customers’

expectations.

TKH aims to be an attractive employer and a solid investment for shareholders, whereby corporate

social responsibility is placed centrally.

| Annual Results 2016 | 07-03-2017 5

STRATEGY TKH

Focus on 4 core technologies in 3 business segments

Telecom

Solutions

Building

Solutions

Efficiency – comfort – safety – security

Industrial

Solutions

Value creation

Growth drivers

Innovations > 15% turnover

| Annual Results 2016 | 07-03-2017 6

0

2

4

6

8

10

12

14

16

0

20

40

60

80

100

120

140

160

2016201520142013201220112010200920082007

in mln € in %

EBITA and ROS development

DEVELOPMENTS 2007 - 2016

1) Excluding one-off income and expenses

1)

0

200

400

600

800

1,000

1,200

1,400

1,600

2016201520142013201220112010200920082007

in mln €

Revenue development

| Annual Results 2016 | 07-03-2017 7

HIGHLIGHTS 4th QUARTER 2016

Turnover up 5.1% at € 362.3 million, organic growth 4.8%

Telecom Solutions - 1.7%

Building Solutions + 4.5%

Industrial Solutions + 7.6%

Increase EBITA of 15,9% - mainly driven by Industrial Solutions due to increase production volume

Higher ROS of 12.8% - healthy mix in activities and high turnover level

Increase net profit before amortization and one-off income and expenses of 10.3%

Visible recovery in order intake tire building segment (Industrial Solutions) in Q4: € 89 million

1) Amortization of intangible fixed assets related

to acquisitions (after tax) 2) The one-off income and expenses in 2016

were impairments, on balance, of € 0.2 million

(2015: €1.5 million) and tax income of € 2.9

million (Q4 2015: € 0.8 million expense)

(in million € unless stated otherwise) Q4 2016 Q4 2015 Δ in %

Turnover 362.3 344.7 + 5.1%

EBITA 46.2 39.9 + 15.9%

ROS 12.8% 11.6%

Net profit before amortization and one-off income

and expenses attributable to shareholders 1) 2) 30.8 27.9 + 10.3%

| Annual Results 2016 | 07-03-2017 8

HIGHLIGHTS 2016

Turnover down 2.5% – organic decline of 0.8%

EBITA down 3.3% – lower production volumes in Industrial Solutions in the first nine months

Increase investments and R&D spending – further strengthening of technology base

Decline net profit before amortization and one-off income and expenses of 5.6% – slightly above previously communicated

bandwidth of € 88 - € 93 million

Robust ROS 10.9% – ROCE: 20.%

Share of innovations in turnover 19.0%

Dividend proposal € 1.10 per (depository receipt for an) ordinary share

1) Amortization of intangible fixed assets

related to acquisitions (after tax) 2) The one-off income and expenses in

2016 were impairments, on balance, of

€ 0.2 million (2015: €1.5 million) and tax

income of € 3.0 million (2015: € 0.3

million)

(in million € unless stated otherwise) 2016 H1 H2 2015 Δ in %

Turnover 1,341.0 650.1 690.9 1,375.2 - 2.5%

EBITA 146.5 64.8 81.7 151.5 - 3.3%

ROS 10.9% 10.0% 11.8% 11.0%

Net profit before amortization and one-off

income and expenses attributable to

shareholders 1) 2)

94.4 41.0 53.4 99.9 - 5.6%

| Annual Results 2016 | 07-03-2017 9

DEVELOPMENTS

SOLUTIONS SEGMENTS

2016

| Annual Results 2016 | 07-03-2017 10

HIGHLIGHTS 2016

SOLUTIONS SEGMENTATION

Telecom Solutions

Segment | Subsegment

Building Solutions

Industrial Solutions

Indoor telecom & Copper systems

Fibre network systems

Vision & Security systems

Connectivity systems

Connectivity systems

Manufacturing systems

Share Business model Markets

13%

43%

44%

5%

8%

26%

17%

18%

26%

R&

D a

nd

Sys

tem

en

gin

ee

ring

Inh

ou

se

Ma

nu

fac

turin

g

Ou

tso

urc

ed

Ma

nu

fac

turin

g

As

se

mb

ling

Se

rvic

e

• Telecom operators

• Cable operators

• Service providers

• Telecom installers

• Telecom retailers

• Housing associations

• Building construction (installers and wholesale)

• Government

• Traffic infrastructure

• Care institutions

• Parking organizations

• Marine and offshore

• Rail

• Energy companies

• Machine building industry

• Process industry

• Tire building industry

• Medical industry

• Robot industry

• Automotive industry

• Can making industry

| Annual Results 2016 | 07-03-2017 11

TELECOM SOLUTIONS

Organic turnover growth: 2.4% – realized in fibre network systems

Increase EBITA due to higher capacity utilization and efficiency

improvements in production

ROS improved to10.6%

0

2

4

6

8

10

12

0

5

10

15

20

25

30

20162015201420132012

in mln € in %

Telecom Solutions

(in million € unless stated otherwise) 2016 2015 Δ in %

Turnover 168.5 166.1 + 1.4%

EBITA 17.9 15.8 + 13.3%

ROS 10.6% 9.5%


1)

| Annual Results 2016 | 07-03-2017 12

Fibre network systems: turnover +5.7% Optical fibre (cable), connectivity systems and components, active equipment

Decline demand for copper networks in the Netherlands not yet compensated by

construction of optical fibre networks in rural areas

Decline in European subsidies negative impact on investments in Poland

Turnover growth in Germany

Growth due to scarcity of optical fibre in China

High capacity utilization and efficiency – positive impact on result

TELECOM SOLUTIONS

Indoor telecom & copper networks: turnover -4.0% Home networking systems, broadband connectivity, IPTV-software solutions, copper cable,

connectivity systems and components, active equipment

Decline investments in copper networks due to a shift of investments to optical fibre

networks

Margin increase on the back of an improved product mix

| Annual Results 2016 | 07-03-2017 13

BUILDING SOLUTIONS

Organic turnover growth: 1.5% – Q4 2016: +4.5%

Turnover decline Poland and China – reluctance for investments

Decline EBITA: 3.5% – start-up and development costs in subsea,

airfield ground lighting and machine vision

0

2

4

6

8

10

12

0

10

20

30

40

50

60

70

20162015201420132012

in mln € in %

Building Solutions


Turnover 574.9 581.6 - 1.2%

EBITA 62.4 64.6 - 3.5%

ROS 10.9% 11,1%


1)

| Annual Results 2016 | 07-03-2017 14

Vision & Security systems: turnover -0.3% Vision technology, systems for CCTV, video/audio analysis and detection, intercom, access controls

and registration, central control room integration, healthcare systems

Organic turnover growth: 1.8%

Organic turnover growth Q4 2016: +7.3% mainly in Parking and Machine Vision

Strong growth Parking with record high order book end of 2016

Significant milestones in development of 2D- and 3D-portfolio Machine Vision

Breakthrough in positioning at number of manufacturers of consumer electronics – as

from Q4 positive impact on turnover

Increase R&D spending – further extension of lead in technology and realization of growth

objectives

BUILDING SOLUTIONS

| Annual Results 2016 | 07-03-2017 15


Decreased market volume due to reduction of large-scale projects in construction and infra

sector

Growth energy- and data cable systems

Reluctance investments in oil- and gas sector and ship building industry – decline turnover

Marine & Offshore

Increase order book due to market share growth and focus on offshore wind industry

Start-up and development costs subsea cable systems and airfield ground lighting systems

Start production in series in Q2 2017 for subsea cables

Roll-out CEDD-technology scheduled in 2018

BUILDING SOLUTIONS

Connectivity systems: turnover -2.5% specialty cable (systems) for shipping, rail, infrastructure, wind energy, as well as installation and energy cable for

niche markets, structured cable systems, contactless energy and data distribution

| Annual Results 2016 | 07-03-2017 16

INDUSTRIAL SOLUTIONS

Organic turnover decline: 3.7%

Decline EBITA: 6.3% – due to effective cost management,

improved efficiency and more ‘in-house’-production limited impact

on ROS

Increase EBITA Q4 2016: 37.3% in comparison to Q4 2015

0

3

6

9

12

15

0

20

40

60

80

100

20162015201420132012

in mln € in %



Turnover 597.6 627.4 - 4.8%

EBITA 79.5 84.8 - 6.3%

ROS 13.3% 13.5%


1)

| Annual Results 2016 | 07-03-2017 17

Connectivity systems: turnover +3.7% specialty cable systems and modules for the medical, robot, automotive and machine

building industries


Positive developments medical and robot industry

R&D investments are paying off

Miniaturization of cable systems and increase life for advanced production systems

New market positions

Strong increase in demand for robot systems has positive impact


| Annual Results 2016 | 07-03-2017 18

Manufacturing systems: turnover -9.9% Tire manufacturing systems, can washers, machine control systems, product handling systems and test equipment


Organic turnover decline: 9.7% – Q4 2016: turnover growth 8.1%

Lower order intake 2016 – increase Q4 to € 89 million (cumulative: € 281 million)

Result negatively impacted due to lower production volumes in 1st half year

Production capacity increased towards H2 to meet higher production levels

Order book end of 2016 well filled – high capacity utilization expected in coming quarters

Relatively large proportion engineering activities prior to production

Newly developed technology and further breakthrough at top 5 tire manufacturers

Considerable interest in MILEXX

Solid progress UNIXX – building prototype in 2017 – expected delivery to launching

customer in 2018

Start-up activities Poland went well – completion construction new factory in 2017

NOTES TO

THE RESULTS

AND BALANCE SHEET

2016

| Annual Results 2016 | 07-03-2017 20

Change in turnover (in € million)

NOTES TO THE RESULTS 2016

1,375.2

- 5.6

- 12.4

- 7.4

- 10.9

2.1

1,341.0

1,300

1,310

1,320

1,330

1,340

1,350

1,360

1,370

1,380

1,390

| Annual Results 2016 | 07-03-2017 21

Geographical distribution of turnover (in %)


2016

Netherlands 19

Europe (other) 45

Asia 20

North America 13

Other 3

2015

Netherlands 19

Europe (other) 43

Asia 23

North America 12

Other 3

| Annual Results 2016 | 07-03-2017 22


(in € million unless stated otherwise)

Turnover

2016

Turnover

2015

Total

Growth

Impact

prices raw

materials

and foreign

currencies

Divest-

ments

Impact

acquisitions

Organic

growth

Telecom Solutions 168.5 166.1 +1.4% -1.0% - +2.4%

Building Solutions 574.9 581.6 -1.2% -2.1% -1.0% +0.4% +1.5%

Industrial Solutions 597.6 627.5 -4.8% -1.1% - -3.7%

Total 1,341.0 1,375.2 -2.5% -1.4% -0.4% +0.1% -0.8%

Gross margin rose to 47.1% (2015: 46.0%)

Improved productmix

Lower raw material prices

Development of turnover per solution

| Annual Results 2016 | 07-03-2017 23

(in € million unless stated otherwise) 2016 2015

EBITA ROS EBITA ROS

Telecom Solutions 17.9 10.6% 15.8 9.5%

Building Solutions 62.4 10.9% 64.6 11.1%

Industrial Solutions 79.5 13.3% 84.8 13.5%

Other -13.3 -13.7

Total 146.5 10.9% 151.5 11.0%

EBITA per Solution


EBITA down with 3.3%

Operating costs (as a % turnover) rose to

36.1% (2015: 34.9%)

Higher R&D spending, in particular in Building

Solutions to prepare for targeted growth in

vertical growth markets

More ‘in-house’ production and thus lower

outsourcing to third parties

Increase depreciation with € 0.7 million due to

high level of investments in recent years

Lower turnover

ROS:10.9% (2015: 11.0%)

| Annual Results 2016 | 07-03-2017 24

Increase amortization costs by € 1.0 million

Higher investments in research & development

Impairments of € -0.2 million (2015: € -1.5 million)

Impairments on capitalized R&D projects and tangible non-current assets of € 1.4 million

Badwill on acquisition of airfield ground lighting activities of € 0.6 million

Release for financial liabilities for earn-out and put-options of on balance € 0.6 million

Result from associates of € 0.9 million

Mainly 5%-interest in Nedap and 12.5%-interest in Chinese preform Joint Venture (ShinEtsu – Fasten)

Decrease tax rate to 18.4% (2015: 20.6%) – normalized 20.9%

Important share of profit is taxed in Dutch innovation box facility

Charge of € 2.6 million for withholding taxes to be paid due to internal transfers of foreign subsidiaries, whereas legal structure

has been simplified and is more in line with a country structure

Benefit of € 5.2 million due to recognition of deferred tax asset of previously unrecognized tax losses


| Annual Results 2016 | 07-03-2017 25

(in € million) Delta

2016 2015 %

Turnover 1,341.0 1,375.2 - 2.5

Raw materials and consumables -709.7 -743.2

Gross margin 631.3 47.1% 632.0 46.0% - 0.1

Operating costs -484.8 -480.5 + 0.9

EBITA 146.5 10.9% 151.5 11.0% - 3.3

Amortization -32.6 -31.6

One-off income and expenses -0.2 -1.5

Operating result 113.7 118.4

Financial expenses -7.6 -7.8

Result from associates 0.9 0,7

Result before taxes 107.0 111.3

Taxes 19.7 23.0

Net profit 87.3 6.5% 88.3 6.4% - 1.2

Net result before amortization and one-

off income and expenses 1) 94.4 7.0% 99.9 7.3% - 5.6

1) Net profit before amortization of acquistion-

related intangible fixed assets (after tax)

attributable to shareholdders


Profit and Loss account

| Annual Results 2016 | 07-03-2017 26

BALANCE SHEET AS OF 31 DECEMBER 2016

(in € million ) 31-12-2016 31-12-2015

Assets

Intangible non-current assets 395.5 400.3

Tangible non-current assets 213.1 192.2

Investment property 1.5 3.6

Financial non-current assets 25.2 22.7

Deferred tax assets 20.8 11.6

Inventories 206.9 194.2

Construction contracts 100.6 74.2

Receivables 194.4 172.9

Cash 88.5 179.0

Total 1,246.5 1,250.7

31-12-2016 31-12-2015

Liabilities

Equity 574.0 520.8

Non-Controlling interests 8.5 8.6

Non-current liabilities 213.9 223.1

Non-current financial liabilities 9.7 26.1

Non-current provisions 66.6 62.0

Borrowings 52.0 126.2

Construction contracts 45.8 54.1

Current financial liabilities 13.2 0.6

Current liabilities 262.8 229.2

Total 1,246.5 1,250.7

| Annual Results 2016 | 07-03-2017 27

156.0

- 1.2- 10.6

1.6 0.1 1.4 7.1 1.6

24.1 180.1

0

20

40

60

80

100

120

140

160

180

200 Working capital

Use of non-recourse factoring:

Use of supply chain finance:

Changes in working capital (in € million)

NOTES TO THE BALANCE SHEET 31 DECEMBER 2016

31 - 12 - 16 € 45.1 miljoen

31 - 12 - 15 € 43.0 miljoen

31 - 12 - 16 € 26.6 miljoen

31 - 12 - 15 € 11.8 miljoen

| Annual Results 2016 | 07-03-2017 28

Change in net debt (in € million)

Financial convenants

Net debt is based on financial

covenants as agreed with banks

Net debt / EBITDA: 1.0

Interest coverage ratio is no

longer applicable

NOTES TO THE BALANCE SHEET 31 DECEMBER 2016

161.0

- 140.5

- 2.7

- 1.3

7.5

29.6

45.3

28.8 0.8

34.1 3.5 166.1

0

20

40

60

80

100

120

140

160

180

| Annual Results 2016 | 07-03-2017 29

CASH FLOW STATEMENT

(in € million) 2016 2015

Operating result 113.7 118.4

Badwill -0.6

Depreciation, amortization and impairments 56.7 55.7

Result on divestments -0.7 -1.2

Share and option schemes 2.0 2.5

Change in provisions and financial liabilities -2.7 -0.7

Change in working capital -27.9 43.4

Cash flow from operations 140.5 218.1

Interest paid -7.5 -7.7

Tax paid -29.6 -28.8

Cash flow from operational activities 103.4 181.6

Acquisitions -0.8 -49.7

Divestment of subsidiaries 2.7

Cash flow from other investing activities -73.7 -62.9

Paid dividend -34.1 -28.7

Acquisition of non-controlling interests -0.1 -25.2

Settlement financial liabilities put options and earn-out -0.7 -2.2

Cash flow from other financing activities -3.3 -36.7

Exchange differences 0.6 -1.8

Change in available funds -6.0 -25.6

| Annual Results 2016 | 07-03-2017 30

RATIOS

1) On annual basis 2) Based on the financial covenants as agreed with the banks 3) Based on weighted average outstanding shares

2016 2015

Working capital / Turnover1) 13.4% 11.3%

Net debt / EBITDA 2) 1.0 0.9

Solvency 46.7% 42.2%

Earnings per ordinary share before amortization and one-off income

and expenses 3) € 2.25 € 2.40

Earnings per ordinary share 3) € 2.04 € 2.07

STRATEGIC

DEVELOPMENTS &

OUTLOOK

| Annual Results 2016 | 07-03-2017 32

BUSINESS DRIVERS

TKH focuses on distinguishing potential for an above-average performance

Niche player strategy – focus on high quality solutions with high margins

High pricing power by innovative unique solutions

Attractive margins because of high yield on investments for customers

Commodity products are mainly used as part of total solutions

Through outsourcing of more than 60% of manufacturing a more flexible capacity is

available and cost basis more variable

Focus on markets with high growth

Spread risk over a large number of product / market combinations

| Annual Results 2016 | 07-03-2017 33

BUSINESS DRIVERS

Focus on four core technologies

Vision & security, communication, connectivity and manufacturing systems

Merge the four core technologies into specific solutions for identified niche high growth vertical markets with

special focus on growth opportunities within the business segments Telecom, Building and Industrial Solutions:

Offer high level of service and integrated solutions

Offer highly innovative ‘best in class’ systems

High return on investment for the customer by focusing on improving efficiency, increasing the reliability of

processes and security levels

Focus on 7 vertical growth markets with growth potential in 3 - 5 years of € 300 - € 500 million

Fibre Optic Networks - Care - Tunnel & Infra - Parking - Marine & Offshore –

Industrial Machine Vision - Tire Building Industry

| Annual Results 2016 | 07-03-2017 34

TKH – VERTICAL GROWTH MARKETS – GROWTH DRIVERS

Advantage of focus on defined vertical growth markets

Focus leads to maximum traction to realize growth potential

Choice for growth verticals is determined on the return potential based on internal and

external benchmarking – ROS and ROCE in combination with organic growth opportunities

Defined turnover and return targets per segment

Executive Board directly involved in realization targets via Solution responsibility

One end-responsible per vertical market who reports directly to the Executive Board

Optimal use of R&D-resources and investments to markets with largest potential

Coordination of technology development priorities to growth verticals

Only acquisitions in defined growth verticals

| Annual Results 2016 | 07-03-2017 35

SOLID BASE GROWTH IN VERTICAL GROWTH MARKETS

WITH FOCUS OP 25 BUILDING BLOCKS

Fibre Optic

Networks Care Parking Tunnel & Infra

Marine &

Offshore Machine Vision Tire Building

Market share

growth France /

Germany / Nordics

/ Poland

Internationalization

Homecare &

Community

platform

Differentiation via

smart-sensor /

CCTV to

‘frictionless’

parking

Airfield Ground

Lighting-

technology based

on CEDD-

technology

Connectivity-

solutions for

subsea

High market

growth 2D-

inspectie in

combination with

innovations

Market share

growth within Top

5- tire

manufacturers

Robot solutions for

patching - SAODF


of integrated vision

& security

solutions for

hospitals



& security

solutions for

parking garages



& security

solutions for

tunnels



& security

solutions

High market

growth 3D-

inspection in

combination with

innovations

Market share

growth ‘tire

component

preparation’, Truck

Tires & ‘Light

Truck tire

manufacturing’

Smart security

solutions for POP’s

Blistering-

technology for

pharmacy –

INDIVION

Market growth and

TKH positioning

North-America /

Europe / Australia /

Middle East

Market share

growth Benelux /

Nordics


of connectivity-

solutions

Market share

growth North-

America / Europe /

Asia

New tire building

platform UNIXX &

MILEXX

Dispenser-

technology for

medicines

Special portfolio

‘mission critical’

communication

Medical and tire

building inspection

systems

Increase share in

turnover Service &

Spare parts

business

| Annual Results 2016 | 07-03-2017 36

GROWTH SCENARIO’S VERTICAL GROWTH MARKETS

Focus vertical growth markets – acceleration realization ROS and ROCE target

Negative short term impact on growth due to continuing reluctance investments China for Tire Building

Industry and decline investments in Marine & Offshore sector

Based on technology roadmaps and planned rollout of associated new business, growth will

materialize from 2018

Growth scenarios:

No specific year for realization

Mainly organic growth > 80%

Omzet (in € miljoenen) 2012 2014 2015 2016 Growth scenarios

Fibre Optics Network 80 99 101 109 120 150

Parking 20 35 50 55 75 100

Tunnel & Infra 30 25 42 43 100 150

Marine & Offshore 20 50 58 53 100 125

Care 30 34 39 43 70 100

Machine Vision 95 103 114 111 150 175

Tire Building Industry 175 338 291 259 450 550

Growth verticals 450 685 697 674 1.065 1.350

| Annual Results 2016 | 07-03-2017 37 0,5

1,0

1,5

2,0

2,5

3,0

0,0

10,0

20,0

30,0

40,0

50,0

60,0

2016201520142013201220112010200920082007

in mln € in %

R&D costs in P&L

HIGHER MARGINS DUE TO FOCUS ON TECHNOLOGIES

0

5

10

15

20

25

30

35

0

50

100

150

200

250

300

350

2016201520142013201220112010200920082007

in mln € in %

Turnover from innovations

1,0

1,5

2,0

2,5

3,0

3,5

4,0

0,0

10,0

20,0

30,0

40,0

50,0

60,0

2016201520142013201220112010200920082007

in mln € in %

R&D expenditure

As % of turnover

35

37

39

41

43

45

47

49

0

50

100

150

200

250

300

350

2016201520142013201220112010200920082007

in mln € in %

Innovations have positive impact on group added value

| Annual Results 2016 | 07-03-2017 38

FINANCIAL OBJECTIVES TKH

Progress realization targets on track

ROS:10.9% (2015: 11.0%)

ROCE: 20.1% (2015: 22.1%)

Targets (mid term)

ROS 11 - 12%

ROCE 20 – 22%

NET debt / EBITA <2.0

| Annual Results 2016 | 07-03-2017 39

OUTLOOK

The global economic outlook is generally positive

Uncertain geopolitical developments, economic developments in China and low oil prices have a negative impact on the

willingness to invest in certain sectors

In order to respond to the market developments, we decided in the course of 2016 to further increase our R&D efforts

and focus on acceleration of the growth programs within our vertical growth markets - this has created a strong

foundation to safeguard our growth ambitions for the coming years

Based on the implementation of our growth plans, together with the defined building blocks for growth and associated

roll-out of new technology, we see a better starting position for growth in 2017 - expectation is that growth will materialize

from 2018

Expected turnover growth in vertical growth markets in 3-5 years with € 300 to € 500 million

Telecom Solutions

Increase investments in optical fibre networks in Europe and China

Investments in market penetration within Europe in recent years – growth potential for TKH primarily in Europe

Scarcity of optical fibre in Chinese market will decline in course of 2017, which may result in pressure on margins

| Annual Results 2016 | 07-03-2017 40

Building Solutions

Reluctance to invest in oil and gas industry expected to continue

Growth in Marine & Offshore segment given start of subsea cable systems activities

Technological developments in Machine Vision portfolio will enable TKH to further expand its market share with

advanced technology


Investments in industrial sector combined with robotization and automation are increasing – expected growth in

sub-segment industrial connectivity systems

In sub-segment manufacturing systems continuing reluctance to invest in China – large number of projects outside

China expected to be realized in coming year

Order book at start of 2017 is better filled – on balance, higher order intake expected in 2017

TKH will give a concrete forecast for the full-year 2017 profit at the presentation of its interim results in August 2017

OUTLOOK

| Annual Results 2016 | 07-03-2017 41

ANNEX I:

CORE TECHNOLOGIES

BIJLAGE I:

TKH TECHNOLOGIEËN

| Annual Results 2016 | 07-03-2017 43

CORE TECHNOLOGIES VISION & SECURITY:

• Video surveillance

• safety cameras (explosion proof)

• Video management and –analysis

• Guiding & lighting systems

• Access control & registration systems

• Industrial inspection & automation

• Robot control and diagnostics

• Quality control systems

COMMUNICATION

• Optical fibre systems

• Mission critical communication

• Intercom systems

• (Personal) alarm systems

• Evacuation systems

• Emergency systems

• Building management & monitoring

• Public address

• Audio systems

CONNECTIVITY

• Sub-sea cable systems

• Marine cable systems

• Optical fibre connectivity

• Contactless energy & data

connectivity

• Specialty cable systems for

robot, medical & machine building

• Drag chain systems

• Multi-Media-Connect

• Energy, building & Infra and

installation connectivity

MANUFACTURING SYSTEMS

• Medicine distribution

• Tire assembling

• Tire component systems

• Passenger & Truck tire systems

• Vision inspection

• Product handling

• Production automation

• Scada systems

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ANNEX II:

VERTICAL

GROWTH MARKETS

| Annual Results 2016 | 07-03-2017 45

TKH – VERTICAL GROWTH MARKETS – FIBRE OPTIC

Growth drivers

Data use through the impact of information and communication

technology on the way we live our lives continues to grow

Internet has become a basic service, like gas, water and

electricity

Developments such as the 'Internet of Things', 'Industry 4.0'

and 'Internet of Vehicles' will require a high (mobile) internet

speed - emergence of 5G internet

24-hour availability is becoming more established and

accepted

Several European countries have announced investment plans

for rollout of FttH projects to meet the strong increasing need

for bandwidth

Position

Integrated solutions – connectivity – security

High knowledge level of network requirements customers

Cost leadership

Strong innovative power

Resources prepared for growth with available and exiting capacity

| Annual Results 2016 | 07-03-2017 46

TKH – VERTICAL GROWTH MARKETS – CARE

Growth drivers

Life expectancy is continually increasing and healthcare spending will increase

sharply due to more and better, but also more expensive care – therefore, the

demand for technologies for care solutions is increasing

Changing healthcare funding: shifting from the government to the institutions

and healthcare insurers

Innovation in the field of domotics, diagnostics, e-health and self-testing for

prevention and screening, provide new business in the sector.

Shortage of skilled workers

Informal caregivers play an important role and, together with the client and the

healthcare professionals, are equal partners - technology support is necessary

for the required information exchange

The demand for medicines (volume) has been growing as a result of

demographic developments, while the cost of care will have to be lowered

Increase central task of preparing medicines in a remote location - acceptance

of robotics in pharmacy wholesale

Position

Smart Care concept with centralized management and community platform

End to end, modular care platform including service concept with data hosting to increase care efficiency and quality

Viedome is leading care concept in NL with increasing service model – selected international roll-out (Germany, France)

| Annual Results 2016 | 07-03-2017 47

TKH – VERTICAL GROWTH MARKETS – PARKING

Growth drivers

Revenue from car parks is under pressure due to low supply and

mobility - need to reduce OPEX

Demand for providing a visual dashboard with parking information -

managers and car park operators can react faster and more

efficient to current situations

Increase capacity utilization and revenues by means of

differentiated parking fee

Demand for comfort and convenience for parkers.

Use of technologies to improve safety, access and payment

possibilities

Emergence of demand for frictionless parking can be achieved with

new technology solutions

Position

Efficiency through centralization, smart maintenance, yield management, modular parking solutions

Develop European Nr 1 position in parking and gain momentum in North America and top locations ME

Gain momentum on large 5 accounts and large spenders airports, shopping malls

| Annual Results 2016 | 07-03-2017 48

TKH – VERTICAL GROWTH MARKETS – TUNNEL & INFRA

Growth drivers

In Europe, investment in tunnel technology for new and

existing tunnel are planned for the next few years

Due to strict legislation and regulations in the field of security,

ever increasing demands are made on the technical

equipment

Increasing demand for technologies in order to comply with

strict requirements: evacuation - communication - detection -

identification – security

Principals are shifting responsibilities to the contractors -

formation of alliances between principals and contractor so

that parties have a common interest in cost control

Availability infrastructure - tunnels, airports and roads - is

increasing by the TKH advanced technologies that require

less maintenance with more efficiency

Position

Increasing demand for highly integrated security designed solutions for infrastructure tunnels

Total security concepts (video and communication) for tunnels

Disruptive airfield lighting concept based on CEDD technology

Number 1 position in Benelux for tunnel security concepts

| Annual Results 2016 | 07-03-2017 49

TKH – VERTICAL GROWTH MARKETS – MARINE & OFFSHORE

Growth drivers

Large increase global generated power by wind power

Demand for larger cargo ships and need for efficient external site

management

Increase in the building of quality ships, cruise liners and luxury yachts

Increase of remote control and secure of unmanned operations on

platforms

A lot of attention for safety on platforms via special ‘zone’ certification.

Modification of supply chain due to limited storage capacity on shipyards

and platforms and high cost of downtime

High demands on system availability under various environmental

conditions, such as extreme temperatures, humidity, oil, salt water

Position

Addressing Safety & Security in certification rich environment

Vessel attendance system

Subsea cable solutions

Smart camera solutions incl. thermal, leakage detection, ATEX housing

Mission critical communication

Completing portfolio in data connectivity, power cables and safety

Expanding in international large accounts

Marine & Offshore

| Annual Results 2016 | 07-03-2017 50

TKH – VERTICAL GROWTH MARKETS – MACHINE VISION

Growth drivers

Demand for vision technology is increasing due to trend towards

industrial automation and robotics need

Continue demand for more productivity and improvement of high

quality of produced products

Vision technology is a superior alternative for the inspection of

production systems and for detection, inspection and identification that

cannot be seen by the human eye

Strong increase of new applications where vision technology will be

applied

Because of strict regulations to the quality of food and medicines,

vision technology offers the solutions because of the 100% traceability

and ´fail / pass’ application

Position

Technology leadership in many application areas

Market leader for high-end systems

Strong innovation and R&D competence with breakthrough technology for 3D inspection

Strong worldwide sales organisation

Recognised by leading Industrial application companies worldwide as key supplier

| Annual Results 2016 | 07-03-2017 51

TKH – VERTICAL GROWTH MARKETS – TIRE BUILDING

Growth drivers

High priority of the tire manufacturing industry to replace existing technology with

an emphasis on high productivity, efficiency, waste reduction, quality

improvement and smaller batches

The number of types of tire for passenger cars has increased more than tenfold

in recent decades. This calls for more flexible production methods

The trend towards ever larger tire dimensions and towards safer, better-quality

tires requires technological developments

Local production - innovations have become essential to reduce the working

capital requirement in the supply chain of the tire manufacturing industry

Over 70% of the existing tire manufacturing systems are older than 15 years

Due to the high prices of raw materials, there is a need for a more efficient use

of materials in the production of tires which asks for high tech manufacturing

systems

Due to rising labour costs, demands for manufacturing systems with higher

productivity and high operator independence – ‘eyes & hands off’ manufacturing

Position

Market share TKH in outsourced market: > 70%

Total market share including top five tire manufacturers: > 20% – target >50%

Technology leadership through high level of R&D - protected with patents and high innovation level

Proprietary vision technology strong differentiator for the technology leadership

| Annual Results 2016 | 07-03-2017 52

EXPANSION PLANS TIRE BUILDING INDUSTRY WILL SUPPORT

INCREASED ORDER INTAKE TIRE BUILDING VERTICAL

Bridgestone - € 149m

passenger tire

manufacturing plant

Michelin - € 265m

modernise production

Michelin - €450m

production facility

passenger car and light

trucks

Goodyear - € 437m

expansion tire factory

in China (Pulandian).

Maxxis - € 364m

plant in India

Nokian Tires - € 90m

capacity increase

Apollo Tyres - €475m

investment

Shenzhou - expansion

Ningxia Province - total

RMB 1.65bn project

truck & passenger car tires

Sentury Tire - ~$100m

passenger tire plant

Michelin –expansion

plant to 10 to 18m tires

Bridgestone –CA$300m

passenger and light truck

tire manufacturing plant

Goodyear - Topeka

factory of $250 million

Pirelli - $200m new plant

Sumitomo - $141m

facility for truck and bus

tires

Yokohama - JPY3.7b

production capacity for

high-performance tires

Pirelli - €200m

production

plant

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