COMPANY PRESENTATION EPTEMBER 2009 S VIDRALA SA DISCLAIMER This - - PDF document

S EPTEMBER 2009

VIDRALA SA

COMPANY PRESENTATION

DISCLAIMER

This presentation includes or may include representations or estimations concerning the future about intentions, expectations or forecasts of VIDRALA or its management which may refer to the evolution of its business performance and its results. These forward looking statements refer to our intentions, opinions and future expectations, and include, without limitation, statements concerning our future business development and economic performance. While these forward looking statements represent our judgment and future expectations concerning the development of our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to, (1) general market, macro-economic, governmental and regulatory trends, (2) movements in local and international securities markets, currency exchange rates and interest rates as well as commodities, (3) competitive pressures, (4) technological developments, (5) changes in the financial position or credit worthiness

• f our customers, obligors and counterparties.

The risk factors and other key factors that we have indicated in our past and future filings and reports, including those with the regulatory and supervisory authorities (including the Spanish Securities Market Authority – Comisión Nacional del Mercado de Valores

• CNMV), could adversely affect our business and financial
• performance. VIDRALA expressly declines any obligation or commitment to provide any update or revision of the

information herein contained, any change in expectations or modification of the facts, conditions and circumstances upon which such estimations concerning the future have been based, even if those lead to a change in the strategy or the intentions shown herein. This presentation can be used by those entities that may have to adopt decisions or proceed to carry out

• pinions related to securities issued by VIDRALA and, in particular, by analysts. It is expressly warned that this

document may contain not audited or summarised information. It is expressly advised to the readers of this document to consult the public information registered by VIDRALA with the regulatory authorities, in particular, the periodical information and prospectuses registered with the Spanish Securities Market Authority – Comisión Nacional del Mercado de Valores (CNMV).

• I ntroduction
• General Overview
• Business Performance
• Objectives

Description

:

A leading manufacturer of glass containers with international projection and a strategy focused on grow th, value creation and business specialisation. Supplier of glass containers for a w ide variety of products in the beverages and food industry. Vidrala produces m ore than 3 billion of bottles and jars per year

• btaining EUR 3 9 0 Million annual revenues.

Western Europe’s fourth m anufacturer through six com plem entary sites geographically located towards our strategic areas of sales.

Highlights

Southern Europe’s leading com pany in glass containers. Focused on strategic areas of sales through an

• ptim al

productive structure and com plem entary geographical organization. W ide custom er base through a balanced relationship betw een m ultinationals and sm all custom ers through a profitable selected product m ix and w ell positioned com m ercial strategy. Managem ent expertise and industrial know - how : strong track record in organic grow th and acquisitions. High im provem ent potential under the current process of integration of the recent acquisitions. Stable and sustainable dividend policy.

5

Brief History

Establishment of Vidrerías de Alava S.A. Vidrala goes public Industrial process innovation, energy optimization New Strategic Plan

Acquisition: GALLO VI DRO (Portugal)

Subsidiary CRI SNOVA, S.A. set up

Acquisitions: CORSI CO (Italy), CASTELLAR (Spain) 1965 1981 1985 1989 2001 2003

ORGANI C GROW TH ACQUI SI TI ONS

2005

Acquisition: MD VERRE (Belgium)

2007

6

100.000 200.000 300.000 400.000 500.000 600.000 700.000 800.000 900.000 1.000.000

1966 1981 1989 1995 1998 2003 2006

1 9 6 6 1 9 8 1 1 9 8 9 1 9 9 5 1 9 9 8 2 0 0 3 2 0 0 8 PRODUCTI ON ( VOLUME I N TONS OF GLASS)

C.A.G.R.: + 1 3 %

7

A History of Grow th

Productive Structure

6 Plants in 4 countries 1 3 Furnaces

Employing more than 1 ,8 0 0 people Market share in Iberia: 27% Market share in France: 6% Market share in Italy: 4% Market share in W. Europe: 8%

A COMPLEMENTARY FOOTPRI NT

8

• 1 0 0 ,0 0

2 0 0 ,0 0 3 0 0 ,0 0 4 0 0 ,0 0 5 0 0 ,0 0 6 0 0 ,0 0 7 0 0 ,0 0 sep-03 mar-04 sep-04 mar-05 sep-05 mar-06 sep-06 mar-07 sep-07 mar-08 sep-08 mar-09

14X 12X 10X

Value Creation

SHARE PRI CE PERFORMANCE

MARKET CAP ( in EUR m illions, left) and P/ E* RANGE LI NES

2 0 0 0 -2 0 0 7 share price perform ance: reflection of earnings progression

* Source: Reuters Consensus

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• Introduction
• General Overview
• Business Performance
• Objectives

Principles

I N THE PRODUCT I N THE MARKET I N OUR I NDUSTRY I N OUR PROJECT

W E BELI EVE:

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Glass is identified w ith the concepts of health ( safety, purity, inertity) , convenience ( flexibility, versatility) , sustainability ( respect to the environm ent) and prem ium im age.

Quality: Glass is natural, transparent, impermeable, nonporous, sanitary and completely inert. Safeguards against moisture and oxygen invasion. Is resistant, can be used to process foods and other products at high temperatures. It does not deteriorate, corrode, stain or fade maintaining the taste and quality of the original products. I m age: Glass is attractive, providing a image of quality for products. Can be labeled, colored and formed into various sizes and shapes enabling high product differentiation. More than 70% of consumers believe that glass packaging suggest quality. Ecological: Glass has intrinsic and unique features that make it the only fully and infinitely recyclable packaging m aterial. A used bottle can be employed to make a new bottle again and again without any loss in quality or quantity. Glass recycling saves energy, reduces emissions and helps to preserve natural resources also extending furnace life and reducing manufacturing costs.

The Product

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SHE SHELF LIFE F LIFE

PAPER 3% M ETAL 23% PLASTIC 1 2%

GL GLASS 62% 62%

QU QUALITY

PAPER 2%

GL GLASS 73% 73%

PLASTIC 21 % M ETAL 4%

HE HEALT ALTHIE IEST ST

PAPER 2% M ETAL 4% PLASTIC 1 2%

GL GLASS 82 82%

FLAV FLAVOUR

PAPER 5%

GL GLASS 75% 75%

PLASTIC 3% M ETAL 1 7%

PURI RITY TY

PAPER 2% M ETAL 6% PLASTIC 1 4%

GLA GLASS 78% 78%

Glass, the preferred packaging m aterial:

• Results of the “Consum er Preferences in Packaging Materials Survey 2 0 0 6 ” ( USA) :

Summary: “Glass packaging is the overwhelming first choice of consumers for preserving quality, purity, and taste. It is also seen as the all around most healthy form of packaging. When it comes to the “organic consumers,” the preference for glass packaging increases significantly. Respondents’ preference for glass does not alter by age, sex, or income.”

Preserves the purity of the product inside Presents the true flavour of the product Keeps food in its healthiest form Preserves the quality of the product inside Increases the shelf life of a product

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The Product

GLASS PET CAN I NSULATI NG QUALI TI ES TRANSPARENCY HOT PACKAGI NG CAPACI TY RECYCLABI LI TY FLEXI BI LI TY AND VERSATI LI TY W EI GHT AND RESI STANCE OPTI MAL ACCEPTABLE DEFI CI ENT

• STUDY BY SI EGEL+ GALE AND O-I . JULY 2 0 0 9 : : Consum er Preferences for Food and Beverage

Packaging

“ Consumer sumers Worldwide De

• rldwide Desire Fo

sire Food

• d and

and Be Bever erages in in Gla Glass.

• s. Consumers around the world overwhelmingly

prefer foods and beverages in glass to other packaging materials, but new research commissioned by Owens-Illinois, Inc. suggests consumers struggle to find their favorite brands packaged in glass on store

• shelves. In a global research study conducted by Siegel+Gale, one of the world’s premiere strategic

branding companies, more than 2,900 consumers in nine countries were polled about their preferences regarding food and beverage packaging. Designed to gauge how consumers choose among the various packaging alternatives and weigh criteria for packaging, the study found the preference for glass packaging is strong: 93.5 percent for wine to 66 percent for non-alcoholic beverages.

Glass, the preferred packaging m aterial:

The Product

COMPARI SON OF ATTRI BUTES

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The Product

… and m ore: I TS UNI QUE CHARACTERI STI CS I N I MAGE, TRANSPARENCY, ATTRACTI VE SHAPES AND COLOURS, VERSATI LI TY AND FLEXI BI LI TY HAVE BOOSTED GLASS AS A KEY MARKETI NG I NSTRUMENT. GLASS PACKAGI NG I S PART OF MODERN LI FE.

The Glass Packaging I ndustry: a m ature and resilient m arket

Forecasts indicate that GLOBAL demand for glass containers will remain stable, growing at annual rates close to 3% , extending the trend of the last decade

The Market

Global Packaging Market by Materials Past and forecasted sales by m aterials

Source: EUROMONITOR I ncludes packages made of plastic, glass, metal, paper, carton and wood in the categories of food, beverages, pharma,,healthcare and others.

Million illions of

• f units

its 2003 2003 Sh Share e 2003 2003 2008 2008 Sh Share e 2008 2008 CAGR CAGR 03- 03-08 08 Flexibles 1.485.658 47% 1.663.231 45% 2,3% Rigid plastic 525.528 16% 669.024 18% 4,9% Paper containers 371.282 12% 405.474 11% 1,8% Metal 341.201 11% 384.001 10% 2,4% Glass 306.190 10% 353.234 10% 2,9% Liquid cartons 110.214 3% 131.178 4% 3,5% Others 49.436 2% 55.116 2% 2,2% Tota Total 3.1 .189.509 89.509 10 100% 0% 3.6 3.661.258 61.258 10 100% 0% 2,8 2,8% Share by m aterial Grow th 2 0 0 3 -2 0 0 8

Cartons: 3% Others: 2% Flexibles: 45% Rigid Plastics: 45% Paper: 12% Metal: 11% GLASS GLASS: 10% 10%

0% 1% 2% 3% 4% 5%

Flexibles Rigid plastic Paper containers Metal Glass Liquid cartons Others

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200 400 600 800 1.000 1.200 1.400 1.600 1.800 2.000

1.989 1.990 1.991 1.992 1.993 1.994 1.995 1.996 1.997 1.998 1.999 2.000 2.001 2.002 2.003 2.004 2.005 2.006 2.007

OTHERS JUICES SOFT DRINKS BEER WATER FOOD PRESERVES OLIVE OIL SPIRITS WINE AND SIM.

Source: ANFEVI

Spain is the fourth producer of glass containers in Europe, behind France, Germany and Italy. Quality segments like Wine and Cava (+ 3% annual growth rate since 1989) and more specialized products like Olive Oils (+ 20% CAGR since 1989) lead demand growth in a market performing above European averages. Glass packaging is enjoying a healthy momentum in our natural markets on the back of rising energy prices affecting relatively more to other packaging materials, growing environmental regulations, and the beverage industry’s growing interest in marketing its products with better-quality containers.

The Market

Our Natural Markets: situation differs by regions and products

The Spanish glass containers m arket. Sales perform ance by segm ent in tons 8 9 -0 7 . Quality segm ents drive grow th under a m ature and stable m arket C.A.G.R.: + 2 ,3 %

17

The Market

20 40 60 80 100 5 10 15 20 25 30 35

GLASS PACKAGI NG PRODUCTI ON PER CÁPI TA

PORTUGAL PORTUGAL FRAN FRANCE SPAIN SPAIN ITAL ITALY GE GERMANY ANY USA USA BE BENE NELUX LUX JAPAN JAPAN UK UK POLAND POLAND ME MEXICO XICO RUSSIA RUSSIA CH CHILE ILE BRASIL BRASIL CH CHINA INA

OUR NATURAL MARKETS, OUR STRATEGI C MARKETS Developed m arkets QUALI TY Prevalence

Developed m arkets VOLUME Prevalence

Em erging m arkets GLASS PACKAGI NG PRODUCTI ON PER CÁPI TA ( KG) GDP PER CAPI TA ( $ 0 0 0)

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The I ndustry

Local and capital intensive business. Natural barriers. Resilient Markets. Moderate organic grow ths. Environm ental com m itm ent. Close to m arket needs. Flexibility, versatility. Margin for technological developm ent. Focus on I nnovation is crucial. Unique features of glass versus substitutive m aterials.

I NDUSTRY CHARACTERI STI CS

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The I ndustry: Europe

Main players in Europe

VIDRALA: 4th player 8% market share

The European sector:

Source: Vidrala

European market: EU15´ s + Switzerland + Turkey 0% 5% 10% 15% 20% 25% 30% 35% 40%

O- O-I Sain I Saint t Go Gobain bain Ardagh Ardagh Glass Glass VIDRALA Oth Others rs

20

The I ndustry: Europe

Plants locations

0% 5% 10% 15% 20% 25% 30% 35%

SAI NT GOBAI N VI DRALA B&A O- I SANTOS BAROSA

VIDRALA: Market share: 27%

The I berian m arket Main players

The I ndustry: I beria

Source: Vidrala

22

The I ndustry: I beria

Plants locations:

23

The I ndustry: I taly

Plants locations:

24

The I ndustry: France

Plants locations:

25

Our Project

Our AI MS, Corporate Responsibility:

TO CREATE W EALTH TO CREATE FUTURE TO BE ETHI CAL

26

Diversified profitable business I ncreased revenues & EBI TDA Enhanced EPS Strengthened Cash-flow generation Maxim ised ROCEs and Profitability

VALUE CREATI ON

Productive capacity

Expansion and increased versatility Standardization of processes Technological growth

Product

Improved product mix Increased product range Optimisation of resources

Logistics

Complementary logistics Centralized sales areas Lower transport & better service

Clients

Increased client base Improved service Better access to profitable markets

Our Project

Rationale for Grow th: Contribution of new plants

27

50 100 150 200 250 300 350 400

2 0 0 2 2 0 0 4 2 0 0 6 2 0 0 8

OTHERS I TALY PORTUGAL FRANCE SPAI N

WI NE 4 0 % CHAMPAGNE 8 % OLI VE OI L 7 % JUI CES 7 % WATER 1 % Othe r s 1 % SPI RI TS 1 0 % SOFT DRI NKS 6 % BEER 1 7 % PRESERVES 3 %

Tow ards an international projection.... SALES BREAKDOW N BY COUNTRY ( I N EUR THOUSANDS) ... optim izing the product m ix SALES BREAKDOW N BY PRODUCT

Our Project

Rationale for Grow th: Business Expansion

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10,00% 14,00% 18,00% 22,00% 26,00% 30,00%

2003 2004 2005 2006

75,00% 80,00% 85,00% 90,00%

EBITDA MARGIN (left) PACK TO MELT (right)

Rationale for Grow th: The exam ple of Gallo

The exam ple of the first acquisition ( m ade in 2 0 0 3 ) : success in the process of integration: GALLO VI DRO EBI TDA MARGI N SI NCE ACQUI SI TI ON

Our Project

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• Introduction
• General Overview
• Business Perform ance
• Objectives

FI RST QUARTER. Eur millions

Business perform ance

RESI LI ENT PERFORMANCE I N A DI FFI CULT BUSI NESS ENVI RONMENT Sales for the six m onths ended june 3 0 , dow n -5 .9 %

SALES BY QUARTER

SECOND QUARTER. Eur millions

20 40 60 80 100 120

Q1 2006 Q1 2007 Q1 2008 Q1 2009

20 40 60 80 100 120

Q2 2006 Q2 2007 Q2 2008 Q2 2009

31

FI RST QUARTER. Eur millions

Business perform ance

RESI LI ENT PERFORMANCE I N A DI FFI CULT BUSI NESS ENVI RONMENT EBI T for the six m onths ended june 3 0 , up + 0 .6 %

EBI T BY QUARTER

SECOND QUARTER. Eur millions

2 4 6 8 10 12 14 16 18

Q1 2006 Q1 2007 Q1 2008 Q1 2009

2 4 6 8 10 12 14 16 18

Q2 2006 Q2 2007 Q2 2008 Q2 2009

32

10 20 30 40 50 60 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 Net Profit (EUR Millions) Operating Income - EBIT (EUR Millions) 100 150 200 250 300 350 400 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8

SALES

Eur millions

*

EBI T, NET PROFI T

Eur millions

Sustainable solid grow th

33

• Introduction
• General Overview
• Business Performance
• Objectives

12,00% 13,00% 14,00% 15,00% 16,00% 2 0 0 8 2 0 0 7 2 0 0 6 2 0 0 5 2 0 0 4 2 0 0 3 2 0 0 2

OUR STRATEGI C OBJECTI VE: TO GROW TH W I THOUT OVERLAPI NG OUR EFFI CI ENCY ADVANTAGES

HI STORI CAL OPERATI NG MARGI NS 2 0 0 2 - 2 0 0 7

EBI T MARGI NS SI NCE THE I NI TI ATI ON OF THE EXTERNAL GROW TH STRATEGY

Our Aim : To m aintain our Strengths

1 st ACQUI SI TI ON – GALLO VI DRO ( PORTUGAL) ( I NI TI AL DI LUTI VE EFFECT ON MARGI NS) PLANT UNDER I NTEGRATI ON 2 nd and 3 rd ACQUI SI TI ONS – CASTELLAR AND CORSI CO ( I NI TI AL DI LUTI VE EFFECTS ON MARGI NS) 2 PLANTS UNDER FI RST STAGE OF I NTEGRATI ON + ENERGY I NFLATI ON EFFECT 4 rd ACQUI SI TI ON I NI TI AL DI LUTI VE EFFECTS ON MARGI NS + EXTRAORDI NARY ENERGY I NFLATI ON PRESSURES OFFSET BY EFFI CI ENCY I MPROVEMENTS AND SOLI D BUSI NESS PERFORMANCE. STARTI NG SI TUATI ON: 2 PLANTS W ELL OPTI MI SED.

35

OUR STRATEGI C OBJECTI VE: TO GROW TH W I THOUT OVERLAPI NG OUR EFFI CI ENCY ADVANTAGES

Our Aim : To m aintain our Strengths

2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 6 2 0 0 7 2 0 0 8 ASSETS 5 4 3 6 0 6 6 8 8 LI ABI LI TI ES 5 4 3 6 0 5 6 8 8 CURRENT ASSETS 160 191 223 SHAREHOLDERS EQUI TY 171 200 226 CASH AND EQUI VALENTS 1 SHARE CAPI TAL 22 22 23 RECEI VABLES 91 111 114 TREASURY STOCK

• 1
• 1
• 4

I NVENTORI ES 69 79 109 RETAI NED EARNI NGS 150 179 207 NON CURRENT LI ABI LI TI ES 383 415 465 LONG TERM LI ABI LI TI ES AND OTHERS 223 207 249 PROPERTY PLANT AND EQUI PMENT 264 293 342 DEFERRED I NCOME & DEFERRED TAX LI ABI LI TI ES 64 63 60 GOODWI LL 59 59 59 PROVI SI ONS 30 25 32 I NTANGI BLE ASSETS 14 8 17 LONG TERM BANK DEBT 129 120 158 DEFERRED TAX ASSETS 39 47 44 OTHER NON CURRENT ASSETS 7 7 2 CURRENT LI ABI LITIES 149 198 212 SHORT TERM BANK DEBT 68 92 93 PAYABLES 70 90 101 SHORT TERM TAX LI ABI LI TI ES AND PROVI SI ONS 11 16 18

FACI NG 2 0 0 9 W I TH A STRENGHTENED BALANCE SHEET

( EUR m illions)

36

Transport 11% Others 21% Personnel Expenses 26% Raw Materials 20% Energy (Gas + Electricity) 22%

Objectives

70% 75% 80% 85% 90% 95% 100%

• Avg. 0 6 - 0 8

2 0 0 9

CAPACITY UTILIZATION RATE % POTENTI AL VALUE COMPLEMENTARI TY = POTENTI AL SI NERGI ES EFFI CI ENCY COST CONTROL, I NNOVATI ON BENCHMARKI NG TARGET: TO CLOSE THE GAP FOCUS ON FREE CASH FLOW CAPACI TY CURTAI LED, TEMPORARI LY

0% 5% 10% 15% 20% 25%

LESS EFFI CI ENT PLANT MORE EFFI CI ENT PLANT

OPERATING MARGIN (% ) GROUP

CONSOLI DATED

37

Our Project

A solid industrial project:

Based on Clear Business and Market Definitions, w ith a vocation to custom ers service, supported by an optim al financial structure, and a strategy focused on our Shareholders interests.

W e Know and understand: The industry The packaging m arket The glass sector Our natural m arkets Our Com petitors Our Custom ers

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• ANNEX: CORPORATE

SOCI AL RESPONSI BI LI TY

Sustainability

Environm ental Com m itm ent

Glass, a unique m aterial w ith unique eco-friendly attributes:

I NTEGRAL RECI CLABI LI TY: 1 RECYCLED BOTTLE = 1 NEW BOTTLE 1 0 0 % unlim ited MULTI PLI ER EFFECT: Recycling helps to preserve natural resources, reduces em issions, reduces costs

3 0 % 4 0 % 5 0 %

1 9 9 9 2 0 03 20 07

A continuos com m itm ent VI DRALA CULLET RATI O PERFORMANCE

RECYCLED GLASS / TOTAL RAW MATERI ALS

Sustainability

Environm ental Com m itm ent

0,30 0,32 0,34 0,36 0,38 0,40 0,42 0,44 0,46 0,48 0,50 1 9 9 0 1 9 9 5 2 0 0 0 2 0 0 3 2 0 0 7

EMI SSI ONS. I NDI CATOR PERFORMANCE TONS OF CO2 PER TON OF GLASS PRODUCED

SECTOR 2 0 0 7 REGULATORY TARGET VI DRALA

A FI RM COMMI TMENT

• W e use m ore than 1 ,3 0 0 tons of recycled glass everyday

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