Investor presentation

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1 Investor presentation 4th Quarter 212 Annual Accounts 212 (preliminary) 8 th February 213

2 Disclaimer This presentation contains certain forward-looking information and statements. Such forward-looking information and statements are based on the current, estimates and projections of the Company or assumptions based on information currently available to the Company. Such forward-looking information and statements reflect current views with respect to future events and are subject to risks, uncertainties and assumptions. The Company cannot give assurance to the correctness of such information and statements. These forward-looking information and statements can generally be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use terminology such as "targets", "believes", "expects", "aims", "assumes", "intends", "plans", "seeks", "will", "may", "anticipates", "would", "could", "continues", "estimate", "milestone" or other words of similar meaning and similar expressions or the negatives thereof. By their nature, forward-looking information and statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements that may be expressed or implied by the forward-looking information and statements in this presentation. Should one or more of these risks or uncertainties materialize, or should any underlying assumptions prove to be incorrect, the Company's actual financial condition or results of operations could differ materially from that or those described herein as anticipated, believed, estimated or expected. Any forward-looking information or statements in this presentation speak only as at the date of this presentation. Except as required by the Oslo Stock Exchange rules or applicable law, the Company does not intend, and expressly disclaims any obligation or undertaking, to publicly update, correct or revise any of the information included in this presentation, including forward-looking information and statements, whether to reflect changes in the Company's expectations with regard thereto or as a result of new information, future events, changes in conditions or circumstances or otherwise on which any statement in this presentation is based. Given the aforementioned uncertainties, prospective investors are cautioned not to place undue reliance on any of these forward-looking statements. / 2 / 8-February-13

3 Agenda Financial status at Q4 212 Status - Business Areas Updates Appendix Speakers: Walter Qvam CEO Hans-Jørgen Wibstad CFO / 3 / 8-February-13

4 Highlights Solid quarter with important contract wins, confirming test results and important deliveries Operating Revenues MNOK 4 29 EBITA MNOK 48 Important contracts won in all business areas Successful live firings of NSM. Excellent test results for Medium Caliber Remote Weapon Station On plan on our large defence delivery programs High delivery activity on our offshore delivery contracts. Problem projects now under control Expansion of Oil & Gas portfolio through the acquisitions of Apply Nemo and Advali A year with good results and improved positions Operating Revenues MNOK EBITA MNOK Order backlog MNOK Approx. 1 % of revenues into R&D on promising new and improved solutions Further strengthened our position within several areas of the offshore market Confirmed the world leading position within the RWS-market Solid performance on large defence delivery projects are excellent references for future programs / 4 / 8-February-13

5 Financial status Q4 212 Quarterly trends in operating revenues Revenues Q4-11 Other KPS 95 KM KDS KPS 758 Revenues Q4-12 Other 15 5 KM 2 43 Q1-1 Q2-1 Q3-1 Q4-1 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 KDS / 5 / 8-February-13

6 Financial status Q4 212 Quarterly trends in EBITA EBITA Q KPS KM KDS EBITA Q KPS 155 KM 28 Q1-1 Q2-1 Q3-1 Q4-1 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 / 6 / 8-February-13 KDS 123

7 Financial status 212 Operating revenues Revenues 211 Other KPS KM KDS Revenues 212 Other KPS KM KDS / 7 / 8-February-13

8 Financial status 212 EBITA EBITA KPS KM KDS EBITA KPS 655 KM / 8 / 8-February-13 KDS 381

9 Financial status Q4 212 Quarterly trends in orders Backlog of orders Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q New orders per quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q % 4% => Backlog of orders 212 KPS Other 446 KDS KM 6 42 / 9 / 8-February-13 After sales and framework agreements not converted into delivery contracts are not included in the backlog

10 Financial status Q4 212 Cash Flow Q4-12 Q EBITDA ,38 2,394 Change in other operating related items 38 1,99 (2,11) (751) Cash flow from operating activities 884 1, ,643 Acquisition of fixed assets (165) (112) (523) (434) Acquisition of subsidiaries and non-controlling interests (56) (91) (69) (226) Other investment activities (22) (56) (121) (139) Cash flow from investing activities (243) (259) (713) (799) Cash flow from financing activities (2) (5) (49) (425) Impact of currency fluctuations on bank deposits and cash equivalents (1) 15 (19) 4 Net change, bank deposits and cash equivalents 629 1,472 (574) 423 / 1 / 8-February-13

11 Financial status Q4 212 Cash Flow Cash IB EBITDA Q4 Change in other operating related items Investments Q4-12 Q3-12 Q2-12 Q Cash and short-term deposits 2,59 1,88 1,59 1,92 3,83 Net changes in financing activities and exchange rates 2 59 Cash UB Working capital 3,528 3,549 2,187 2,27 1,928 Net interest bearing debt (1,198) (567) (491) (1,334) (2,191) KONGSBERG has unused credit lines of NOK 1 billion Equity ratio 38.6% 38.4% 38.1% 39.9% 35.1% / 11 / 8-February-13

12 Summary key figures Q4 212 Q Operating revenues 4,29 3,883 15,652 15,128 EBITDA ,38 2,394 EBITA ,985 2,132 EBITA margin 11.4% 14.% 12.7% 14.1% EBT ,831 2,8 EPS Equity % % 35.1% Backlog of orders ,523 17,839 New orders 3,717 3,97 14,65 15,16 Book/bill Number of employees - - 7,259 6,681 EBITDA/employee * (in NOK 1 ) * Based on average number of employees in the period / 12 / 8-February-13

13 Kongsberg Maritime Status

14 Kongsberg Maritime Quarterly trends in operating revenues and EBITA Operating revenues Revenues Subsea 26% Merchant 22% Offshore 52% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q EBITA Revenues Subsea 25% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Merchant 16% Offshore 59% / 14 / 8-February

15 Kongsberg Maritime 212 Operating revenues EBITA Backlog of orders New orders / 15 / 8-February-13

16 Kongsberg Maritime Q4 212 Quarterly trends in orders Backlog of orders 31% % 2 1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q => New orders per quarter New orders Subsea 24% 1 5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Merchant 14% Offshore 62% / 16 / 8-February-13 After sales and framework agreements not converted into delivery contracts are not included in the backlog

17 Strengthened backlog and market position Excellent order intake in 212 Book/Bill ratio at 1.13 High win-rate in the advanced offshore drilling segment Improved market positions for deliveries to advanced OSVs and standard PSVs Several contracts for deliveries to FPSO-vessels and LNG Carriers Our ebird concept goes into full rate production Growth in our AUV and hydro acoustics market Successful launch of our new life cycle support concept Follow the Sun Solid overall delivery performance, with a few exceptions Offshore vessels and rigs Full Picture deliveries meeting milestones BP Skarv our biggest Full Picture project ever completed Subsea instrumentation and hydro acoustics solutions increasing production Supplier bankruptcy and problematic project execution resulting in disappointing results for a couple of projects / 17 / 8-February-13

18 Kongsberg Defence Systems Status

19 Kongsberg Defence Systems Quarterly trends in operating revenues and EBITA Operating revenues Revenues 211 Comm. 5% Intergrate Def 28% Missile 31% 4 2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Naval sys 27% Aerost 9% EBITA Revenues 212 Comm. 7% Intergrate Def 33% Missile 28% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q / 19 / 8-February-13 Naval sys 22% Aerost 11%

20 Kongsberg Defence Systems 212 Operating revenues EBITA Backlog of orders New orders / 2 / 8-February-13

21 Kongsberg Defence Systems Q4 212 Quarterly trends in orders Backlog of orders Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q New orders per quarter 53% 47% => New orders Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Aerostr. 14% Missile Syst 16% Comm 13% Integrated Def. Sys 25% Naval Sys 32% / 21 / 8-February-13 Framework agreements not converted into delivery contracts are not included in the backlog

22 Good operations and important confirmations Good quarter Large delivery programs on track Strategic contract wins Contract for delivery of integrated systems to submarines to be built at DSME MNOK 14 contract for deliveries of ground station services to Indian Space Research Organisation 212 Solid contracts and important confirmations Important contract wins Penguin to Brasil Combat systems to the Norwegian CV9 Upgrade program Contract for deliveries to NATO s Alliance Ground Surveillance-program Several Satellite-contracts Several submarine contracts Confirmation of Norwegian and US support to Joint Strike Missile Successful live firings of Naval Strike Missile Important milestones successfully passed on all the large delivery programs / 22 / 8-February-13

23 Kongsberg Protech Systems Status

24 Kongsberg Protech Systems Quarterly trends in operating revenues and EBITA Operating revenues 35 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q EBITA Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q / 24 / 8-February-13

25 Kongsberg Protech Systems 212 Operating revenues EBITA Backlog of orders New orders / 25 / 8-February-13

26 Kongsberg Protech Systems Q4 212 Quarterly trends in orders Backlog of orders Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q % 33% => 3 New orders per quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q / 26 / 8-February-13 After sales and framework agreements not converted into delivery contracts are not included in the backlog

27 Confirming our world leading market position Good order intake in Q4 First order within CROWS III MNOK 6 contract with Textron for delivery of Dual RWS to the next generation of Tactical Armoured Patrol Vehicles (TAPV) 212 A challenging but also confirming year Our world leading market position has been confirmed CROWS III to US Army Canadian TAPV-program RWS bid invitations, campaigns and proposals in all relevant regions Medium Caliber Remote Weapon Station is now on the market Successful demonstrations and tests Increasing market attention Strong market potential Experiencing some delays in concluding the first contracts High level of activity within product development to include: Camp and facility protection solutions New RWS variant with increased elevation for urban scenarios / 27 / 8-February-13

28 KONGSBERG s position going forward

29 Our market view remains largely unchanged / 29 / 8-February-13

30 Adjusting and reinforcing Group set-up Adjusting the role of the Group Industrial Group Holding Strengthened Operating Companies governed within a corporation with a strong Group Glue Strengthening Group Business Development Industry focus M & A integration new ventures alliances & partners Driving a more proactive growth agenda Developing industry portfolios Defence Offshore/Maritime Oil & Gas Expanding scope and variety within each industry portfolio / 3 / 8-February-13

31 Outlook KONGSBERG has improved its positions in the maritime, offshore and defence markets in 212. The Group has a good order backlog moving into 213, providing a good foundation for the operations Kongsberg Maritime is expected to maintain it s strong market positions, and the level of activity will remain good also in 213 Kongsberg Defence Systems has several major, delivery programmes in the engineering and production phase, providing a good foundation for revenues in 213. The level of activity is expected to remain good also this year Kongsberg Protech Systems has built up a strong global market position, but the level of activity in 213 is expected to be somewhat lower compared to recent years. Deliveries from contracts more recently entered into, including CROWS III with lower margins, will start in 213 / 31 / 8-February-13

32 Appendix

33 DETERMINED INNOVATIVE COLLABORATIVE RELIABLE What we start we finish. We do not give in. We relentlessly pursue improvements, new ideas and new solutions. We collaborate as individuals and as an organisation. We are reliable people. We are responsible citizens. / 33 / 8-February-13

34 Solutions from deep sea to outer space - Extreme performance for extreme conditions KONGSBERG is a world leading supplier of high-technology solutions and advanced applications for the Maritime, Oil & Gas, Defence and Space industry. Our solutions creates safety and performance for people and companies operating in extreme conditions. / 34 / 8-February-13

35 Financial status at 31 December 212 Income statement MNOK. Q4-12 Q Operating revenues Operating expenses (3 633) (3 261) (13 344) (12 734) (13 12) Earnings before interest, tax, depreciation and amortisation (EBITDA) Depreciation (96) (78) (323) (262) (269) Earnings before interest, tax and amortisation (EBITA) Amortisation (33) (3) (119) (97) (13) Impairment (2) - (12) - - Earnings before interest and tax (EBIT) Net financial items (17) (23) (23) (27) (16) Earnings before tax Income tax (126) (138) (511) (578) (597) Earnings after tax Non-controlling interests (2) (5) (5) (1) 5 Equity holders of the parent Earnings per share (NOK) Earnings per share, diluted (NOK) New orders (MNOK) / 35 / 8-February-13

36 Financial status at 31 December 212 Balance sheet MNOK 31 Dec.12 3 Sept Dec.11 Property, plant and equipment Intangible assets Other non-current assets Total non-current assets Short-term assets Cash and short-term deposits Total current assets TOTAL ASSETS Paid-in capital Retained earnings Fair value, financial instruments Non-controlling interests Total equity Long-term interest-bearing debt Other non-current liabilities Total non-current liabilities Construction contracts, liabilities Other current liabilities Total current liabilities TOTAL EQUITY AND LIABILITIES / 36 / 8-February-13

37 Shares and shareholders 2 largest shareholders (25 January 213) Share price performance Shareholders # shares Stake 1 State repr. by the Ministry of Trade and Industry % - 2 National Insurance Fund % -.42 %p 3 Arendals Fossekompani % - 4 MP Pensjon % - 5 Skagen Vekst % -.11 %p Total for the 5 largest shareholders % 6 JP Morgan Chase bank - nominee % -.2 %p 7 Odin Norden % -.49 %p 8 Odin Norge % -.66 %p 9 Danske Invest Norske II %.74 %p 1 Aberdeen Asset Management %.55 %p 11 Danske Invest Norske %.51 %p 12 RBC Investor Service - nominee %.26 %p 13 Montague Place Custody Service %.9 %p 14 The Northern Trust C Non-treaty acc % New 15 Verdipapirfondet DNB %.36 %p 16 Odin Offshore % -.4 %p 17 KLP Aksje Norge Indeks Vpf %.8 %p 18 State Street Bank & Trust Co - nominee %.6 %p 19 DNB Livsforsikring %.14 %p 2 BNP Paribas Secs Service - nominee % New Total for the 2 largest shareholders % Total number of shares 12 1.% Index 1) 13, 12, 11, 1, 9, 8, 7, KOG compared with indices from 1 January 211 KOG Index OSEBX OSE Ind. 1) KOG's share price relative to the Oslo Stock Exchange Benchmark Index and the Industrials Index. Closing share price on 1 January 211 = 1 / 37 / 8-February-13

38 Currency Hedging portfolio at 31 December 212 (values in NOK) Hedging portfolio ==> Orders: All orders signed in foreign currencies are hedged, eliminating currency risk Prognosis: Prior to signature, probable contracts are also hedged pursuant to the guidelines stipulated in the Group's Foreign Exchange Policy USD Prognosis USD Ordres EUR Prognosis EUR Ordres Foreign exchange policy Foreign currency position Hedging of all signed contracts Partial hedging of anticipated revenues in foreign currencies two years ahead Goals: Create predictability and ensure profitability for the existing product portfolio Allow time for operational and strategic initiatives in the event of lasting changes in exchange rates 7-75 per cent of sales influenced by exchange rates 3-35 per cent of costs in foreign currencies About 35 per cent net exposure, primarily in USD and EUR Our competitiveness is influenced by: Changes in NOK exchange rates, NOK/EUR, against all foreign competitors Changes in the USD exchange rate, USD/EUR, against all competitors with their cost base in USD or currencies linked to the USD / 38 / 8-February-13

39 The Board of Directors of Kongsberg Gruppen ASA Finn Jebsen (62) Chair of the Board Self-employed CEO of Orkla from 21 to 25 Other directorships: Chair of the Board of Kavli Holding AS, deputy chair of KLP forsikring, director of Berner Gruppen AS, Anders Wilhelmsen & Co AS and Norsk Hydro ASA Irene Waage Basili (45) Director Chief Executive Officer GC Rieber Shipping Other directorships: Odfjell SE and North Sea Drilling Group Anne-Lise Aukner (56) Deputy chair Chief Executive Officer and Country Manager Nexans Norway AS Other directorships: EDB Business Partner ASA, Federation of Norwegian Industries, Europacable Norge AS, INTPOW, Nexans Norway AS, Aukner Holding AS and the Confederation of Norwegian Enterprise (NHO). Member of NHO's Ethics Committee and the Executive Management Forum at the Ministry of Petroleum and Energy Roar Marthiniussen (55) Director (employee representative) Sales and Marketing Manager, Kongsberg Maritime AS Engineer from the Horten College of Engineering Employee representative since 1999 Erik Must (7) Director Other directorships: Chair of the Board of Directors for Fondsfinans ASA, Fondsfinans Kapitalforvaltning Holding AS, Arendals Fossekompani ASA, Gyldendal ASA and Erik Must AS. Director of the NSTC Media Group AS, Norwegian Museum of Cultural History, the Arenzt Legacy and the Biotechnology Centre, University of Oslo, among others John Giverholt (6) Director CFO, Ferd AS Experience from Orkla ASA, DnB ASA and Norsk Hydro ASA Other directorships: Director of Telenor ASA Helge Lintvedt (55) Director (employee representative) Senior Project Engineer at Kongsberg Defence Systems Graduate of the Kongsberg College of Engineering Employee representative since 29 Head of the Norwegian Society of Engineers and Technologists' corporate chapter at KDA, Director, KDA Kai Johansen (45) Director (employee representative) Shop Steward in the Norwegian United Federation of Trade Unions, Kongsberg Protech Systems Training from Kongsberg Vocational School Guild certificate as a CNC operator Employee representative since 27 / 39 / 8-February-13

40 Financial calendar and Investor Relations contacts Financial calendar 213 Publication of quarterly figures Q1 3 April Q2 16 August Q3 31 October Capital Markets Day November IR contacts Hans-Jørgen Wibstad CFO Telephone: hans.jorgen.wibstad@kongsberg.com Jan Erik Hoff VP Investor Relations and Reporting Telephone: / jan.erik.hoff@kongsberg.com Tor Egil Kili IR Manager Telephone: tor.egil.kili@kongsberg.com Kongsberg Gruppen ASA Telephone: office@kongsberg.com For more information, see: / 4 / 8-February-13

41 kongsberg.com