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Company Presentation

Company Presentation Mensch und Maschine Software SE July 2010 Business model Mensch und Maschine Software SE (M+M) is a leading vendor of CAD/CAM solutions in Europe (CAD/CAM = Computer Aided Design/Manufacturing) European CAD/CAM Market: M+M Market share ~7%

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Company Presentation

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  1. CompanyPresentation Mensch und Maschine Software SE July 2010

  2. Business model • Mensch und Maschine Software SE (M+M) is a leading vendor of CAD/CAM solutions in Europe(CAD/CAM = Computer Aided Design/Manufacturing) • European CAD/CAM Market: M+M Market share ~7% • Founded 1984 – 26 years market presence • Leading Value-Added Reseller/Distributor in Europe for global CAD market leader Autodesk • M+M share in Adsk sales: Europe 20-25% / global ~9% • M+M’s own CAD/CAM Software development for differentiation and profile in the market • Open Mind (CAM) & Dataflor (Gardening/Landscaping)

  3. M+MSoftware Development of CAD/CAM Software Worldwide sales Autodesk M+M VAR D/A/CH Value Added Reselling of CAD Software / Service M+M Distribution Europe Resellers End customers Business model SegmentM+M Software Low volume / High margin Sales 2009: EUR 21.8 mln Gross margin ~90% EBITDA margin 2009: 7.1% 2007/08 (=potential): 15-25% SegmentDistribution High volume / Low margin Sales 2009: EUR 106.2 mln Grossmargin ~17% EBITDA margin 2009: 0.8% 2007/08 (=potential): 3-4% SegmentVAR (new in 2009) Medium volume & margin Sales 2009: EUR 35.3 mln Grossmargin ~38% EBITDA margin 2009: -2.9% (Startup) Mid term potential: up to 10%

  4. Business model • Market Offensive 2009: Extensive change from Distribution (indirect) to VAR (Value-Added Reselling) in D/A/CH • Acquisitions of key VAR partners • Germany: Haberzettl, LeyCAD, AtWork, Dressler, BenCon 3D, customX, integra • Austria: IT Consulting, Personal-Entwicklung • Switzerland: CAD-LAN, CADiWare • Additional acquisitions in 2010: Zuberbuehler (CH), CAD-praxis (D), Scholle (D) • Share swap (founders become co-entrepreneurs, low cash requirement). Two step takeover, performance dependent valuation over 2-4 years • With 35 locations, M+M has approached full area coverage (Exception: Eastern Germany) • Added Value (=Gross Margin) ~50/50% from Service / CAD software sales

  5. Business model • Segmentation (group level): Distribution dominating sales, Added Value (Gross Margin) breakdown close to 50/50% 2008: Distribution still largest sales area, but Added Value (Gross Margin) breakdown evenly balanced over the three Segments 1-6/2010:

  6. Business model • Geographical markets: • Distribution & M+M Software in 16 European countries • D/A/CH: VAR Business • Sales offices in Japan, APAC and USA (M+M Software only) • Headcount: • June 30, 2010: 597 (PY: 503) • 110 / 18% Distribution • 292 / 49% VAR Business • 195 / 33% Software

  7. CAD/CAM in practice • Example Mechanical Engineering: Cheese manufacturing facility Customer: Kalt Maschinenbau AG, Luetisburg, Switzerland

  8. CAD/CAM in practice Custumor: Genesis-design GmbH, Munich, Germany • Example Industrial Design

  9. CAD/CAM in practice • Architecture: Klimahaus in Bremerhaven/Germany Customer: agn Niederberghaus und Partner GmbH,Ibbenbueren

  10. CAD/CAM in practice • Example Mechanical Engineering: Filling/sealing facilities for the food and cosmetic industry Customer: ROBOT FOOD Technologies GmbH, Wietze, Germany

  11. CAD/CAM in practice • Electrical Engineering • Product AutoCAD ecscad • Price region: approx. EUR 5,000 per seat • Technology sold to Autodesk on October 15, 2008 Project: Groupwide unique electrical documentation for INA-Schaeffler group, Herzogenaurach

  12. CAD/CAM in practice • Example parametric design: Customer specific configuration of heat exchangers with customX Customer:GEA Happel Klimatechnik Produktions- und Service gesellschaft mbH, Obershausen, Germany

  13. CAD/CAM in practice • Gardening and Landscaping • Subsidiary DATAflor • Price region: approx. EUR 5,000 per seat • Design and maintenance of GaLa Projects Project: Revitalizationof Waldsiedlung, Hanau-Grossauheim

  14. CAD/CAM in practice • CAM – Computer Aided Manufacturing • Subsidiary Open Mind – Product family hyperMill • Price range: EUR 15,000 to >100,000 per seat • Nearly 10% of group revenue / >30% of gross margin Project: CNC programming for the manufacturing of motorsport prototypes by Japanese DAISHIN SEIKI CORPORATION

  15. Sales development • Sales 2009: EUR 163.3 mln / -27% • M+M Software: EUR 21.8 mln / -13% • VAR Business: EUR 35.3 mln (PY: 1.5) • Distribution: EUR 106.3 mln / -46% • Currency effects approx. EUR -6.2 mln • Transition to VAR Business in D/A/CH • Outside D/A/CH: -25% in local currencies • Seasonality: Q1-Q3 -29% / Q4 -19.5% • Gross margin EUR 51.0 mln / -8.7% • Gross yield 31.2% (PY: 25.1%) • Sales 1-6/2010: EUR 97.43 mln / +14.5% • M+M Software: EUR 12.18 mln / +8% • VAR Business: EUR 27.23 mln / +79% • Distribution: EUR 58.02 mln / -1% • Gross margin 1-6/10: EUR 31.93 mln / +22% • Gross yield 32.8% (PY: 30.7%)

  16. Earnings development • Operating profit EBITDA 2009 EUR 1.38 mln (PY: 13.04 / -89%) • EBITDA margin 0.8% (PY: 5.8%) • Segmentation • M+M Software: EUR +1.54 mln • Distribution: EUR +0.86 mln • VAR Business: EUR -1.01 mln (Ramp up) • Seasonality: Bottom in Q3 • Net: EUR -4.78 mln (PY: +5.76) • Mainly from Depreciation/Amortization/Impairmt. • Cash flow: EUR +5.66 mln (PY: 9.32) • 1-6/2010: Positive development • EBITDA: EUR 2.90 mln / +21% • Software +1.44 / Distribution +1.83 / VAR Business -0.37 • Cash flow: EUR +2.72 mln (PY: -0.89)

  17. Balance sheet development • Total assets higher (market offensive): • Dec 31, 2009: EUR 101.15 mln (PY: 84.99) • June 30, 2010: EUR 103.92 mln Total assets • Net bank debt stays on low level: • Dec 31, 2009: EUR 12.39 mln (PY: 11.16) • June 30, 2010: EUR 10.47 mln • Shareholders‘ equity nominally lower: • Dec 31, 2009: EUR 24.22 mln (PY: 26.40) • Capital ratio 23.9% (PY: 31.1%) • June 30, 2010: EUR 25.18 mln / ratio 24.2% • IFRS special: Minority shares in VAR acquisitions have to be booked as non-current liabilities, though payable non-cash by share swaps • Adjusted Equity: EUR ~33.2 mln • Capital ratio ~32.0% Net bank debt

  18. Shareholder structure • # of shares at June 30, 2010: approx. 14.6 mln • Shareholder structure: • 53.1% Free float • 46.9% Management • CEO / Chairman of the Board Adi Drotleff 41.2% Purchase since beginning of 2006:>800,000 shares / Invest >4.0 MEUR • CTO Werner Schwenkert 5.7% • M+M is both a public and private company

  19. Investor Relations • Designated Sponsors: • LBBW, Stuttgart • Close Seydler, Frankfurt • Analyst coverage: • LBBW: „Buy“ - fair value EUR 4.50 • Independent Research: „Buy“ - fair value EUR 5.90 • SES Research: „Buy“ - fair value EUR 4.50 • Performaxx: „Buy“ – fair value EUR 8.54 • GSC Research: „Neutral“ – fair value EUR 3.90

  20. Change to m:access (Mar 31, 2010) • Primary motivation: • Unification of “Geregelter Markt” and “Amtlicher Handel” resulted in a regulatory environment lifted to DAX level • Estimated increase of opportunity costs:~ 1 MEUR p.a. primarily for audit / legal advisory and additional internal costs in legal / finance departments • m:access offers optimal cost/performance ratio including full consideration of shareholders’ transparency interests • Tradability through Xetra fully guaranteed • M+M will overfulfill m:access rules • Continued full quarterly reports, including Q1 and Q3 • German/English reporting und corporate news • Group financial statements according to IFRS

  21. Outlook • 2010E: H2 approx. mirrored to H1 • Sales: EUR 185-190 mln / +13-16% • EBITDA: EUR 4.5-6.5 mln / >+200% • Operating margin 2.5 to 3.5% • EPS: 3 to 14 Cents • Positive cash flows • If targets achieved: Dividend 10 Cents • Mid to long term targets: • Sales: Return to former CAGR path ~15% p.a. • 2011E: >200 mln / 2012E: >230 mln • More return from revenue due to higher margin in VAR business • EBITDA 2011E: >10 mln / Margin ~5.0%EBITDA 2012E: >15 mln / Margin ~6.5% • EPS 2011E: ~30 Cents / 2012E: >50 Cents

  22. Thank you for your attention !

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