HORNBACH Factbook 2 nd Quarter / 1 st Half-Year 2016/2017

HORNBACH Factbook 2 nd Quarter / 1 st Half-Year 2016/2017 Page 1

History HORNBACH Group 1877 Foundation 1968 1st DIY store with garden center 1980 1st DIY megastore 1987 Going public HORNBACH HOLDING Group 1993 Going public HORNBACH- Baumarkt Subgroup 1996 Austria 1997 Netherlands 1998 Czech Republic 2001 Zuckerhut Award 2002 Switzerland 2003 Sweden 2004 Slovakia 2004 Emission High Yield bond (6.125%) 2006 HORNBACH wins German Handelspreis 2007 Romania 2007 Lifetime Award for Otmar Hornbach 2008 Retailer of the Year in Germany 2010 Start of Multi-Channel Retailing 2013 Emission Eurobond (3.875%) 2015 Change in legal form of HORNBACH Holding AG into KGaA Page 2

Shareholder Structure HORNBACH Group Free Float HORNBACH Familien Treuhand GmbH 100% 56.25% 43.75% HORNBACH Management AG since October 24, 2015 Free Float 23.6% HORNBACH Holding AG & Co. KGaA HORNBACH Baumarkt AG³ Bornheim Listed Ordinary Shares² (ISIN DE0006084403) Neustadt/Weinstraße Listed Ordinary Shares 1 (ISIN DE0006083405) c 76.4% 100% 100% HORNBACH Immobilien AG 3 Bornheim Not listed HORNBACH Baustoff Union GmbH 3 Neustadt/Weinstraße Not listed (General Partner) Management 1 Number of shares: 16,000,000 / Stock market code: HBH 2 Number of shares: 31,807,000 / Stock market code: HBM 3 plus other subsidiary companies in Germany and abroad Page 3

Group Structure HORNBACH Group Neustadt/Weinstrasse August 31, 2016 100% 76.4% 100% Property Development within HOLDING Group 154 DIY and garden stores 1.8 million sqm sales area in 9 countries Germany (98) Austria (14), Netherlands (11), Czech Republic (10), Luxembourg (1), Switzerland (6), Sweden (5), Slovakia (3), Romania (6) 27 Outlets Builders merchant business South-West Germany (25) France (2) Page 4

Network HORNBACH Group Germany 98 stores 1,049,000 sqm 25 x 2 x August 31, 2016 154 DIY stores in 9 countries sales area: 1.8 million sqm store size: Ø 11,600 sqm Austria 14 stores 168,600 sqm Czech Republic 10 stores 139,000 sqm Romania 6 stores 86,600 sqm Slovakia 3 stores 46,300 sqm Luxembourg 1 store 12,100 sqm Sweden 5 stores 73,100 sqm Netherlands 11 stores 137,700 sqm Switzerland 6 stores 78,000 sqm Page 5

2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 /198 /198 /199 /199 /199 /199 /199 /199 /199 /199 /199 /199 /200 /200 /200 /200 /200 /200 /200 /200 /200 /200 /201 /201 /201 /201 /201 /201 /201 Sales Growth HORNBACH Group 3.76 bn 132 m Page 6

Expansion HORNBACH Baumarkt AG FY 2015/2016: 4000 SK 3500 SE CH 3000 Net Sales in million 3.54 bn RO 2500 NL L CZ 43% A 2000 35% 1500 57% 65% 1000 500 0 1994/1995 1997/1998 2000/2001 2003/2004 Germany 2006/2007 2009/2010 2012/2013 2015/2016 International Page 7

Jobmachine HORNBACH Group 17,373 12,014 7,386 3,924 1,372 613 1987/1988 1995/1996 2000/2001 2005/2006 2015/2016 Page 8

Market Position Strategy Growth Opportunities Page 9

Top 6 Ranking (2015): German DIY Retailers HORNBACH Baumarkt AG 5,623 5,230 Net Sales (Europe): HORNBACH ranks #3 3,535 2,462 2,277 Net Sales in million 1,410 OBI Bauhaus HORNBACH ZEUS/Hagebau but is #1 in sales per store ( million) 19.8 2,023 1,709 1,683 8.9 4.5 Bauhaus Globus/Hela and sales per sqm ( ) 23.1 13.6 OBI Toom HORNBACH Zeus/Hagebau 1,201 1,114 1,049 Zeus/Hagebau Toom 6.7 Toom Globus/Hela OBI Bauhaus HORNBACH Globus/Hela [Source: Dähne, Company information] Page 10

Top 10 Ranking (2015): European DIY Retailers HORNBACH Baumarkt AG 15,306 Net Sales in million 14,257 5,762 5,231 3,535 Groupe Adeo Kingfisher OBI Bauhaus Hornbach 3,209 Kesko 2,469 2,440 2,277 1,988 DT Group Zeus/Hagebau Toom Bricomarché [Source: Dähne, Company information] Page 11

Average store size, net sales and sales densities (2015): HORNBACH Baumarkt AG Bubble size = total net sales (Europe) average store size (in sqm) 14.000 OBI 12.000 Bauhaus Megastore HORNBACH 10.000 Toom 8.000 Globus/Hela Zeus/Hagebau 6.000 Eurobaustoff EMV-Profi 4.000 Hellweg 2.000 0 750 1.000 1.250 1.500 1.750 2.000 Net Sales / sqm [Source: Dähne, HORNBACH] Page 12

Like-for-like Sales in Germany HORNBACH Baumarkt AG 140 130 + 33% DIY-Sector (D) HORNBACH (D) 1998 = 100% 120 110 100 90-12% 80 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 [Source: BHB, HORNBACH] Page 13

Market Share (Germany) HORNBACH Baumarkt AG 11.0 in % of DIY store sales 10.0 8.5 7.1 4.9 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 [Source: BHB/GfK DIY-Panel (until 2013), GfK DIY-TSR (from 2014), HORNBACH] Page 14

Strategy HORNBACH Baumarkt AG HORNBACH is the top address for DIY projects Every-daylow-price Superior product offering Project-oriented services Megastore network & multi-channel retailing Sophisticated logistics & IT Continuing internationalisation Outperforming the DIY market & delivering a unique customer experience Page 15

We re a Project DIY Store HORNBACH Baumarkt AG Partner for project customers and professionals. Top quality specialist advice. Added value with our product range and service offerings. Everything in stock. Making shopping easier. Unique advertising campaigns. Every-Day-Low-Price. Page 16

Customers across Europe honor HORNBACH s concept HORNBACH Baumarkt AG Page 17

Store Formats HORNBACH Baumarkt AG Prime locations Focus on big catchment areas Large store format Homogeneous store network Store Type Generates economies of scale in store operation and store development Meets customers needs and provides superior shopping experience Selling Space CapEx 1) (BHB weighted) HORNBACH4 HORNBACH5 HORNBACH6 HORNBACH Typ 2 1) 2) Type 4 8,500 10,999 sqm (incl. drive thru) 15 20 m Type 5 11,000 14,999 sqm 20 25 m Type 6 15,000 sqm (incl. drive thru) 25 30 m Type 2 ( HORNBACH Compact ) 2) ~ 800 sqm ~ 2 m average CapEx for property and building currently in trial phase Page 18

Property Ownership and Hidden Reserves HORNBACH Group Property HI Property HBM Operating Leases Finance Lease Others No. of stores Sales area in % 11 8% 2% 4 Febraury 29, 2016 44 29% 34% 53 27% 41 FY 15/16 ( million) Book value Yield value (x13) Hidden Reserves (x13) Baumarkt Subgroup 545 823 278 Immobilien Subgroup 446 805 359 HORNBACH Group 991 1,628 637 Page 19

Online share of DIY retail market (Deutschland) HORNBACH Baumarkt AG Online share of DIY retail market (Germany) In 2014, online retail accounted for around 5% of DIY sales in Germany. Industry experts expect e-commerce to account for 25% of sales by 2030. 25.0% 5.0% 2014 2030e [Source: IFH, BHB, Roland Berger] Page 20

Sustainable Multichannel Strategy HORNBACH Baumarkt AG Since launching its webshop in December 2010, HORNBACH has Germany s most extensive online range of construction and renovation products. Catalyst for EDLP transparency and price awareness Time-saving: Reserve online & collect in-store Spill-over benefits for our stores Additionally addressing customers living outside of the catchment areas of our stationary stores International roll-out Page 21

Going Live Road-Map HORNBACH Baumarkt AG Country Start of Online Shop Number of SKUs (May 2016) Germany December 2010 120,000 Austria January 2013 87,000 Switzerland November 2014 70,000 Netherlands March 2015 34,000 Czech Republic December 2015 12,500 Luxembourg December 2015 56,000 Romania / Slovakia / Sweden scheduled for 2017/2018 Advantages of stationary retail Advantages of online retail Page 22

Elaborated Supply Chain Management Ensures Europe-wide Logistics (B2B) Sophisticated merchandise management in conjunction with our homogeneous store network Our logistics system combines direct supplies to stores and indirect deliveries via logistics centers Enhanced import possibilities Group-wide integrated IT and merchandise systems Page 23

B2B Logistics HORNBACH Baumarkt AG LC: Lehrte (1994) Import warehouse: Soltau (2012) Berlin (2015)* Castrop-Rauxel (2015)* Nürnberg (2015)* Lorsch (2015)* LC: Essingen (1999) * Special warehouse for long and bulky goods LC: Vilshofen (2005) Page 24

B2C Logistics HORNBACH Baumarkt AG Pure online business: 3 ways to customers Store as e-commerce service partner Home delivery service Reserve & collect at store Direct shipment supplier Collect products ordered online at store Fulfillment HORNBACH DVZ Fulfillment service provider HORNBACH4 HORNBACH6 MVZ Store HORNBACH mailing center Page 25

Private Label Strategy HORNBACH Baumarkt AG Benefits of private labels Private labels share of sales* USP compared with competitors. 35% Lower dependency on national manufacturer brands. 30% Exclusive control over market launch and market positioning. 20% Active management of product lifecycle. Significantly higher gross margins! Successful way to counter downward price pressure from internet! 30.0% 25% 18.9% 15.0% 15% 10% 8.2% 10.3% 05% 00% * year-end figure Page 26

Growth Drivers HORNBACH Group Cocooning New target groups (retreat-to-home lifestyle trend) ( women-at-work, Do-it-for-me, seniors) Increasing need for renovation Multichannel retailing (80% of houses/flats > 20 years) Sustainability and energy efficiency Insulation of facades Replacement of outdated boilers Use of rainwater FSC timber products Strong private labels International expansion Page 27

Financial Year 2015/2016 Page 28

Highlights Financial Year 2015/2016 HORNBACH-Gruppe Like-for-like sales growth (+2.6 %); especially internationally (+4.9 %), Germany +0.8 % Slightly regressive gross margin (37.7 % vs. 38.0 % HBM; 37.0 % vs. 37.3 % HH) Disproportional rising store expenses (primarily maintenance and advertising) Disproportional rising administration expenses (online, IT, customer service center etc.) EBIT clearly below previous year s level, also due to extraordinary depreciations (Impairment tests according to IAS 36) 30 % pay-out ratio results in higher dividends Page 29

Sustainable Sales Growth HORNBACH Group %yoy 3,572 +5.1% +2.3% 2,011 million 1,966 3,755 +9.6% 1,524 1,390 +2.4% 213 218 2014/2015 2015/2016 HORNBACH Baustoff Union HORNBACH Baumarkt AG [International] HORNBACH Baumarkt AG [Germany] rounding differences Page 30

EBIT HORNBACH Group million Margin 4.6% 165 2014/2015 3.7% 138 2015/2016 HORNBACH Baumarkt Subgroup 3.3% 110 2014/2015 2.6% 90 2015/2016 based on International Financial Reporting Standards (IFRS) Page 31

Group Net Income HORNBACH Group 3.0% 2.6% 2.1% 2.0% million Margin HORNBACH Baumarkt Subgroup 107 2014/2015 98 2015/2016 70 72 2014/2015 2015/2016 Page 32

Capital Expenditures HORNBACH Group 156 119 139 million 100 10 5 2014/2015 2015/2016 others HORNBACH Immobilien AG HORNBACH Baumarkt AG Olomouc Page 33

2nd Quarter / 1st Half-Year 2016/2017 Page 34

Highlights 1st Half-Year 2016/2017 HORNBACH Group Pleasing like-for-like sales growth both in Germany and other European countries Like-for-like sales in H1: Germany +2.5% International +7.1% Store openings in Prag, Innsbruck, closing Mannheim, new HBU branch Gross margin below previous year Earnings deficit made up in the second quarter Disproportional rising store expenses Pre-opening expenses significantly down on previous year Swap of operating leases into finance leases reflects a positive EBIT effect, but higher interest expenses Page 35

Growth in Net Sales six months HORNBACH Group 1,831 971 986 million 1,798 1,976 1,084 2,055 2,187 +6.4% 1,143 1,116 +2.4% 920 771 817 711 727 115 117 120 120 123 2012/13 2013/14 2014/15 2015/16 2016/17 HORNBACH Baustoff Union +12.5% HORNBACH Baumarkt AG [International] +2.6% HORNBACH Baumarkt AG [Germany] [rounding differences] Page 36

Growth in Net Sales Q1 and Q2 HORNBACH Group HORNBACH Holding Group 1,052.1 1,116.1 1,002.5 1,070.5 2015/16 million 2016/17 + 6.1% Q1 HORNBACH Baumarkt Subgroup 995.2 1,058.9 938.2 + 6.8% Q2 HORNBACH Baustoff Union Subgroup 1,003.6 56.8 56.4 + 6.4% Q1 + 7.0% Q2 +0.8% Q1 66.5 63.9 + 4.1% Q2 Page 37

Like-for-like Sales* HORNBACH Baumarkt AG Subgroup Q3 2015/16 9M 2015/16 Q4 2015/16 FY 2015/16 Q1 2016/17 Q2 2016/17 H1 2016/17 Total 2.9 1.8 5.6 2.6 4.4 4.5 4.5 previous year 1.0 4.9 2.4 4.4 (1.1) 4.0 1.3 Germany (0.2) 0.4 2.5 0.8 2.7 2.2 2.5 previous year 1.4 6.5 1.8 5.5 (2.4) 4.0 0.6 International 7.0 3.7 9.7 4.9 6.6 7.7 7.1 previous year 0.6 2.6 3.4 2.8 0.7 4.0 2.3 * in constant currencies Page 38

EBIT HORNBACH Group six months + 0.9% 2015/2016 million 2016/2017 76.8 76.5 74.4 76.0-0.3% + 2.2% Q1 Q2 151.1 152.5 2015/2016 2016/2017 based on International Financial Reporting Standards (IFRS) Page 39

EBIT - Breakdown HORNBACH Group 2015/16 2016/17-2.4% million 122.4 119.5 + 9.3% + 6.9% 5.4 HBM 29.6 27.1 5.8 HBU HI HBM: HORNBACH Baumarkt Subgroup HBU: HORNBACH Baustoff Union Subgroup HI: HORNBACH Immobilien Subgroup Page 40

Net Income six months HORNBACH Baumarkt Subgroup million HORNBACH Holding Group 105-3.1% 102 90-9.8% 2015/2016 2016/2017 2015/2016 81 2016/2017 Page 41

In % of net sales Gross Margin six months HORNBACH Group 38.1 38.0 37.4 37.3 37.8 37.4 37.0 36.6 2012/13 37.2 36.5 2013/14 2014/15 HORNBACH Holding Group 2015/16 2016/17 HORNBACH Baumarkt Subgroup Page 42

Earnings per Share six months HORNBACH Group 4.93 4.81 5.22 5.16 4.38 2.59 2.54 2.16 2012/13 2013/14 2014/15 HORNBACH Holding Group* 2.84 2015/16 2.56 2016/17 HORNBACH Baumarkt Subgroup *until FY 2014/2015 average earnings per share Page 43

Cash Flow Statement HORNBACH Group Cash flow statement (abridged) 2016/2017 2015/2016 1. Half 1. Half 198.1 174.4 million Cash flow from operating activities of which: funds from operations 152.5 145.3 of which: change in working capital 45.6 29.2 Cash flow from investing activities -141.5-81.5 Cash flow from financing activities -137.3-27.0 Cash-effective change in cash and cash equivalents -80.7 65.9 Change in cash and cash equivalents due to changes in exchange rates -0.1-0.1 Cash and cash equivalents at March 1 349.7 400.9 Cash and cash equivalents at August 31 268.9 466.7 rounding differences Page 44

Cash Flow Statement HORNBACH Baumarkt AG Cash flow statement (abridged) 2016/2017 2015/2016 1. Half 1. Half 169.1 165.4 million Cash flow from operating activities of which: funds from operations 122.2 121.0 of which: change in working capital 46.9 44.5 Cash flow from investing activities -122.3-73.5 Cash flow from financing activities -103.1-18.3 Cash-effective change in cash and cash equivalents -56.2 73.6 Change in cash and cash equivalents due to changes in exchange rates -0.1-0.1 Cash and cash equivalents at March 1 283.0 334.8 Cash and cash equivalents at August 31 226.7 408.3 rounding differences Page 45

Group Balance Sheet Structure (IFRS) HORNBACH Holding ASSETS Total assets 2,713 Liquid funds 269 2,680 350 million 735 1,595 EQUITY and LIABILITIES Inventories, accounts receivable and other assets Non-current assets 2,713 Total assets 2,680 572 Current liabilities 741 Non-current liabilities 806 1,638 1,400 Shareholders equity 51.6% February 29, 2016 608 August 31, 2016 August 31, 2016 738 1,334 49.8% February 29, 2016 rounding differences Page 46

Group Balance Sheet Structure (IFRS) HORNBACH Baumarkt AG ASSETS 1,986 million 283 665 1,039 EQUITY and LIABILITIES Total assets 2,030 Liquid funds 227 487 Inventories, accounts receivable and other assets Non-current assets Total assets 2,030 Current liabilities 520 711 1,092 515 Non-current liabilities 1,028 Shareholders equity 50.7% February 29, 2016 1,986 August 31, 2016 August 31, 2016 494 973 49.0% February 29, 2016 rounding differences Page 47

Capital Expenditures six months HORNBACH Group 67 83 84 74 73 9 3 11 2014/15 2015/16 2016/2017 64 54 35 53 43 26 11 2012/13 others 2013/14 HORNBACH Immobilien Subgroup HORNBACH Baumarkt Subgroup Olomouc Page 48

Employees HORNBACH Group 17,373 7,034 17,691 7,231 International Germany 10,339 10,460 February 29, 2016 August 31, 2016 Page 49

Outlook Page 50

New Store Openings and Outlook 2016/2017 HORNBACH Group Amsterdam Prag-Chuchle Prag-Chuchle HBU 27th outlet opened (Q2) Capex FC 2016/2017: HBM 120 m / HH 150 m Sales and earnings forecast for FY 2016/2017 unchanged: Sales to increase in a medium single-digit percentage range EBIT FC: HH -> adjusted EBIT 15/16 (151 m) HBM -> ~ adjusted EBIT 15/16 (99 m) Innsbruck Innsbruck Amsterdam-Sloterdijk Mannheim-Käfertal store closed HBM Page 51

Financial Calender 2016 Contact Disclaimer HORNBACH Group December 22, 2016 Financial Update: 3rd Quarter of 2016/2017 as of November 30, 2016 March 23, 2017 Trading Statement for the 2016/2017 Financial Year May 30, 2017 Publication of Annual Report 2016/2017 and DVFA Analysts Conference HORNBACH Baumarkt AG DISCLAIMER This presentation is to be read in the context of the audited financial data of the HORNBACH Holding Group and the disclosures made in the notes to the consolidated financial statements contained in the annual report. It contains statements relating to the future based on assumptions and estimates made by HORNBACH s Board of Management. Forward-looking statements are only valid at the time at which they are made. Although we assume that the expectations reflected in these forecast statements are realistic, the company can provide no guarantee that these expectations will turn out to be accurate. The assumptions may involve risks and uncertainties which could result in actual events differing significantly from the forecast statements. Such factors include those discussed in the Risk Report and Outlook of the annual report. We do not assume any obligation to update the forward-looking statements contained in this presentation. Page 52