H1/Q2 2017 Financial Results

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Forward-looking statement

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The statements on the future in this presentation, including expected sales and earnings, are associated with risks and uncertainties and may be affected by factors influencing the activities of the Group, e.g. the global economic environment, including interest and exchange rate developments, the raw material situation, production and distribution-related issues, breach of contract or unexpected termination of contract, price reductions due to market-driven price reductions, market acceptance of new products, launches of competitive products and other unforeseen factors.

In no event shall ROCKWOOL International A/S be liable for any direct, indirect or consequential damages or any other damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other action, arising out of or in connection with the use of information in this presentation.

Highlights H1

3

Sales of

EUR 1,118 million up 6.6% in reported figures

EBIT of

EUR 110 million up 5% compared to last year

Free cash flow of

EUR 13 million equal to last year

Sales increase in local currencies

5.0%

EBIT margin of

9.8% down 0.2 pp

Net profit

EUR 79 million improvement of EUR 6 million

Highlights Q2

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Sales of

EUR 584 million up 5.3% in reported figures

EBIT of

EUR 64 million up 1.1% compared to last year

Free cash flow of

EUR 64 million up by EUR 14 million over last year

Sales increase in local currencies

4.2%

EBIT margin of

10.9% down 0.5 pp

Net profit

EUR 47 million improvement of EUR 2 million

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H1 sales growth of 5%

Sales grew 5% in local currencies. Sales increased 6.6% in reported figures and reached EUR 1,118 million with a positive currency effect of 1.6%-points – primarily due to a stronger Russian rouble and to a lessor extent, the US dollar.

We have progressively improved pricing since the beginning of the year.

However, there is still a time gap between the significant input cost increases and sales prices increases, which we expect to gradually narrow during the coming periods.

Insulation up 5.2% in local currencies, and 7.0% in reported figures reaching EUR 839 million, owing mainly to the building insulation segment in Western and Eastern Europe and North America.

Systems continued the strong growth mainly stemming from the Grodan business in both North America and Europe. Systems sales up 4.7% in local currencies and 5.6% in reported figures amounting to EUR 279 million.

H1 2016 H1 2017

Reported figures

Local currencies

+5% +6.6%

Insulation Systems

2016

2017 Local currencies

2017 reported figures

+7.0% +5.2%

+4.7% +5.6%

H1 NET SALES EURm

H1 NET SALES PER BUSINESS AREA EURm

6

Q2 sales growth of 4.2%

Sales grew 4.2% in local currencies despite negative seasonal impact of around 2%-points. Sales increased 5.3% in reported figures and reached EUR 584 million with a positive currency effect of 1.1%-points.

Continued strong focus on increasing sales prices to offset significant inflation on input costs. As expected, prices increased at faster pace in Q2 over Q1, though still with a time lag relative to inflation, which we believe peaked in Q2.

Insulation up 4.2% in local currencies, and 5.7% in reported figures amounting to EUR 440 million, owing mainly to the building insulation segment in Western and Eastern Europe and North America.

Systems saw strong growth from the Grodan business while Rockfon had a slow quarter. Systems sales up 3.9% in local currencies and 4.4% in reported figures and reached EUR 144 million.

Q2 2016 Q2 2017

Reported figures

Local currencies

+4.2% +5.3%

Insulation Systems

2016

2017 Local currencies

2017 reported figures

+5.7% +4.2%

+3.9% +4.4%

Q2 NET SALES EURm

Q2 NET SALES PER BUSINESS AREA EURm

7

Regional developments Q2

Western Europe

1.1% 0.3% incl. FX effect

CEE incl. Russia

12.2% 21.8% incl. FX effect

North America, Asia and others

5.7% 6.4% incl. FX effect

Quarterly results negatively affected by the fewer sales days, but with overall good market developments.

Continued strong recovery in France. Good market development in Netherlands, UK, Germany, and

Sweden.

57%

Like-for-like growth Key developments

Satisfactory single-digit sales growth in Russia. Double-digit growth in local currencies in all other main

countries. Positive currency effect of 9.6%, owing primarily to the Russian

rouble.

Continued double-digit growth in US. Canada performed well in the quarter. Southeast Asia experienced negative sales growth. Positive currency effect of 0.7%.

19%

24%

Share of Sales

8

H1 profitability

EBITDA amounted to EUR 189 million, which was at level with last year.

EBITDA margin of 16.9% which is 1.3 %-points lower than H1 2016 due to time lag between the higher inflation on input costs and sales price increases.

The gap is expected to narrow during the coming periods.

Start-up costs in connection with the opening of the Rockfon factory in the United States.

EBIT increased 5% and reached EUR 110 million.

Corresponding to an 9.8% EBIT margin, a decrease of 0.2 %-points.

156 181 191 198 189

73 99 104

125 110

H1 15 H2 15 H1 16 H2 16 H1 17

EBITDA

EBIT

- 0.7%

+5%

14.7% 15.8%

18.2% 17.2% 16.9%

6.9% 8.6%

10.0% 10.8% 9.8%

H1 15 H2 15 H1 16 H2 16 H1 17

EBITDA-margin

EBIT-margin

EURm

9

Q2 profitability

EBITDA down 4% to EUR 103 million.

EBITDA margin of 17.7%, which is 1.7 %-points lower than Q2 2016.

Profitability impacted by time lag between the higher inflation on input costs and sales price increases as well as start-up costs in connection with the opening of the Rockfon factory in the United States.

Sales prices showed a positive development during the quarter.

EBIT increased slightly and reached EUR 64 million.

Results in a 10.9% EBIT margin, a decrease of 0.5 %-points.

89 92 89 83

108 105 94

86

103

47 53

46 41

63 67 58

46

64

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

EBITDA

EBIT

- 4%

+1%

16.0% 16.1% 15.4% 16.8%

19.4% 18.3% 16.1% 16.2%

17.7%

8.4% 9.3% 7.9% 8.4%

11.4% 11.8% 9.9%

8.6% 10.9%

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

EBITDA-margin

EBIT-margin

EURm

10

H1 segment profitability

Insulation EBIT increased 10% to EUR 70 million.

EBIT margin up 0.2%-points to 7.3%.

North America showed higher earnings level driven by sales growth, improved pricing quality and a better utilisation of the US factory.

Systems EBIT down 3% to EUR 39 million.

EBIT margin 14.0%, this is 1.3%-points lower than the same period in 2016 mainly from increasing input costs, especially on steel, as well as one-off costs in connection with the factory and IT projects for Rockfon North America.

64

40

70

39

Insulation Systems

H1 2016

H1 2017

+10%

-3%

3.9%

6.3% 7.1% 8.6%

7.3%

14.2% 12.6%

15.3%

13.2% 14.0%

H1 15 H2 15 H1 16 H2 16 H1 17

Insulation

Systems

H1 EBIT EURm

EBIT-MARGIN (%)

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Q2 segment profitability

Insulation EBIT increased 2% to EUR 43 million.

EBIT margin down 0.3%-points to 8.5%.

Heavy impact from inflation on input costs.

North America continued to perform well.

Systems EBIT was stable at EUR 21 million.

EBIT margin 14.5%, which is 0.6%-points lower than the same period in 2016, owing to one-off costs in connection with the factory and IT projects for Rockfon North America.

42

21

43

21

Insulation Systems

Q2 2016

Q2 2017

+1.7%

stable

5.6% 7.1%

5.5% 5.1%

8.8% 9.2% 8.0%

6.0%

8.5%

14.5% 13.9%

11.5%

15.5% 15.1% 15.8%

11.0%

13.6% 14.5%

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

Insulation

Systems

Q2 EBIT EURm

EBIT-MARGIN (%)

12

Free Cash Flow in H1 and Q2

Cash flow from operations before financial items and tax was EUR 103 million in H1 2017, which is EUR 8 million lower than same period last year mainly from net working capital. In Q2 2017 it amounted to EUR 97 million, which is EUR 14 million higher than same period last year.

NWC decreased to 10.6% of net sales, decreasing from EUR 247 million in Q2 2016 to EUR 241 million in H1 2017, as we saw an improvement in outstanding trade accounts receivables.

Free cash flow in H1 2017 reached EUR 13 million similar to last year, while it increased by EUR 14 million in Q2 2017 and reached EUR 64 million.

ROCKWOOL is net debt free with a net cash position end of second quarter of EUR 88 million, an improvement of EUR 192 million.

35 52

74

-37

50

127

97

-51

64

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

Q2: EUR 14m

H1 2016: EUR 13m

H1 2017: EUR 13m

stable

FREE CASH FLOW EURm

13

Investment activities in H1 and Q2

Capital expenditure totaled EUR 63 million in H1 2017 and EUR 28 million in Q2 2017, which is at level with last year for the quarter.

Capacity investment mainly relates to the new Rockfon production facility in US, which began production in July 2017.

19 10 7

31 21

9 5

20 19

21

24 29

11

7

12

5

15 9

31

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

Aquisitions

Capacity Program

Maintenance CAPEX

INVESTMENTS AND ACQUISITIONS EURm

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Outlook for 2017

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Guidance for 2017 upgraded

1. Sales

2. EBIT

3. INVESTMENT

Net sales are now expected to show positive growth of 5-7% in local currencies (previously 2-4%).

The EBIT margin is still expected to be slightly above 10%.

Investment expenditure excluding acquisitions is now expected at around EUR 150 million (previously EUR 130 million).

Key Figures for the Group

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EURm Q2 2017 Q2 2016 YoY (%) H1 2017 H1 2016 YoY (%) FY 2016

Income statement

Net Sales 584 555 5.3% 1,118 1,049 6.6% 2,202

EBITDA 103 108 -4.3% 189 191 -0.7% 389

EBITDA % 17.7% 19.4% -1.7pp 16.9% 18.2% -1.3pp 17.7%

EBIT 64 63 1.1% 110 104 5.0% 229

EBIT % 10.9% 11.4% -0.5pp 9.8% 10.0% -0.2pp 10.4%

Profit before tax 63 61 3.5% 106 100 6.2% 225

Profit for the period 47 45 3.6% 79 73 7.7% 166

Balance sheet

Total Assets 1,984 2,032 - 2.3% 1,999

Equity 1,533 1,421 7.9% 1,536

Equity ratio 77.3% 69.9% 7.4pp 76.8%

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Questions?

ROCKWOOL International A/S

Hovedgaden 584 DK-2640 Hedehusene Denmark CVR No. 54879415 Tel: +45 46 56 03 00 www.ROCKWOOL.com

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