Sogefi (SGF) Status Update summary

Business unit performance and market dynamics

• Stabilizer bars account for 70% of suspension turnover, with major new projects tied to German OEMs and platform changes expected to impact volumes from 2027-2028.

• High cost pressure is present due to European OEMs' response to Chinese competition, leading to aggressive cost reduction efforts.

• Exposure to Chinese customers is split 54% air and cooling, 44% suspension, with focus on emerging OEMs like Xiaomi and XPeng rather than established players.

• Stellantis exposure is roughly 50/50 between divisions, with compensation for project cancellations managed through new nominations or cash settlements.

• Air and cooling division is ramping up new battery vehicle programs, but current exposure to BEVs remains low.

Operational efficiency and capacity utilization

• Suspension plant saturation is around 60-63%, with ongoing footprint optimization and automation to improve efficiency.

• Romanian suspension plant turnaround is complete, with capacity for an additional 30% volume.

• Air and cooling plants are at full capacity in China, North America (Montreal), and Romania, with expansion planned in China and India; only France has spare capacity (60-65%).

Financial management and cost pass-through

• Suspension division has contractual compensation for raw material and energy cost fluctuations, with most costs passed through to customers based on indices.

• Air and cooling division uses indexed contracts for plastics, minimizing raw material exposure.

• CapEx allocation is about 60% to air and cooling, driven by North American capacity needs and new product launches.

• Working capital requirements are higher in suspension due to raw material intensity.