AVGOL Non wovens

Avgol

A leading global manufacturer of nonwoven fabrics

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Company founded (producing industrial gases)

Began production of Spunbond Nonwovens

Bought Mocksville (North Carolina) plant from Unifi

Started joint venture (with a local partner) in China in Hubei Province

Milestones in Avgol’s Growth

(one line, 50% ownership)

Listed on the Israeli Stock Exchange (Tel – Aviv 100)

Started greenfield production plant in Russia

Increased holdings in JV china to 83%

1953

1988

Mid-2001

2004

Jan 2007

Nov 2008

2009-2011

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~~~L Nonwovens

An Extremely Focused Strategy

• A single target market – the Diaper market

• A single technology – Spunmelt

• A single raw material – PP

• A single technology vendor – Reicofil

A Pioneering company, with a strategy of Global Presence, Cost Leadership and Technology Superiority

Deployed globally, both in developed and developing markets

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The benefit to our global customers - we develop once, deploy in multiple locations simultaneously and uniformly

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Our Mission

To be the Vendor of Choice

Today

Tomorrow

• Highest Quality

• Uncompromising Reliability

• High level of Flexibility

• Competitiveness

Identify & Develop the Next Generations

of Solutions & Products that will allow

our customers to lead their markets

3

Shuki Goldwasser Achai Bonneh Arie Silverberg Eran Schwartz

Michaela Chartof Meir Jacobson

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AVGOL Nonwovens

Strong Leadership

Board of Directors Management team

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Global Footprint

80%100%100% China

Market: Asia

Capacity 24,000 ton

2 Lines

+ 1 new line in 2012

Avgol Around the World

Russia Market: East Europe

Capacity 11,000 ton

1 Line

Israel Market: EMEA

Capacity 31,000 ton

6 Lines

USA Market: North America

Capacity 45,000 ton

3 Lines

+ 1 new line in 2012

Global company with capacity of 111,000 tons in 12 production lines, located in 4 sites and employs 560 employees around the world

In 2012, 2 new lines will start operating, adding 30,000 tons

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160

140

120

100

80

60

40

20

0 2003 2004 2005 2006 2007 2008 2009 2010 2011

• EU-IL • NA-US • APAC-CH • E.EU-RU

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2011 Global Capacity Footprint

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Production Assets Profile

#14 CHINA - Jul ‘12 Reico 3 Hygiene 165” SSMMXS 15,000

#13 NC USA - Apr '12 Reico 3 Hygiene 165” SSMXS 15,000

#12 CHINA- Jun ‘10 Reico 3 Hygiene 165” SSMMXS 15,000

#11 RUSSIA - Mar ‘08 Reico 3 Hygiene & Industrial 126” SMMS 11,000

#10 CHINA - Jan ‘05 Reico 3 Hygiene & Industrial 126” SMXS 8,000

#9 NC USA - Oct ‘05 Reico 3 Hygiene 165” SSMMMS 15,000

#8 NC USA - Oct ‘04 Reico 3 Hygiene 165” SSMMXS 15,000

#7 NC USA - Jun ‘01 Reico 3 Hygiene 165” SSMMS 15,000

#6 Israel ‘03 Perfojet Hygiene & Consumer 82” Hydro Entanglement 6,000

#5 Israel ’99 Reico 3 Hygiene 165” SMMS 11,000

#4 Israel ’97 Reico 3 Hygiene 161” SMS 8,000

#3 Israel ’93 Reico 3 Hygiene 157” SS 7,000

#2 Israel ’91 Reico 2 Ind & Ag & Hygiene 122” S 3,000

#1 Israel ‘88 Reico 2 Industrial & Ag 122” S 3,000

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AVGOL Nonwovens

Sales (M$)

70.290.4

104.9122.8

163.5

229.1 236.8254.2

211.4

277.5

329.6

0

50

100

150

200

250

300

350

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

M$

Continued Growth, 16.7% CAGR 2001-2011

Top 5 customers 2011 ~ 76% of sales (PG 40%, KC 24%)

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AVGOL Nonwovens

Financials 2003-2011

EBITDA Net Income

0

10

20

30

40

50

60

70

2003 2004 2005 2006 2007 2008 2009 2010 2011

0

5

10

15

20

25

30

2003 2004 2005 2006 2007 2008* 2009 2010 2011

(*) not including 4.5 M$ one-time expenses (Fiberweb)

Assets

0

100

200

300

400

2004 2005 2006 2007 2008 2009 2010 2011

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- Net debt ~ Net debt to EB ITDA

180

160

140

120

~ 100 C Ill 80 ::>

60

40

20

0 Q4 Q4 Ql Q2 Q3 Q4 Ql Q2

2008 2009 2010 2010 2010 2010 2011 2011

4.0

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0.0 Q3 Q4

2011 2011

- Net debt -&- Net debt to Assets

180 ~------------------------, 45.0%

160

140 +--- -=- ---- ~ ---,.- ----::=- 7111"

120 -r----

~ 100 C ~ 80

60

40

20

0

Q4 Q4 Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 2008 2009 2010 2010 2010 2010 2011 2011 2011 2011

40.0%

35.0%

30.0%

25.0%

20.0%

AVGOL Nonwovens

Financial Highlights

(*) Calculated based on the LTM results (Last Twelve Months)

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20.0% 19.9%

18.7%

15.0%

10.0%

5.0% 6.7% 5.7%

0.0%

2006 2007 2008* 2009 2010 2011

--- % EBITDA -+- % Net Income

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EBITDA & Net Income Trends

(*) not including 4.5 M$ one-time expenses (Fiberweb)

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AVGOL Nonwovens

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Financial Highlights

(*) Return on Capital Employed

USD '000 2009 2010 2011

Revenue 211.4 277.5 329.6

EBIT 29.2 35.5 41.3

% 13.8% 12.8% 12.5%

EBITDA 42.0 52.0 58.9

% 19.9% 18.7% 17.9%

Net Income 15.6 21.0 24.7

% 7.4% 7.6% 7.5%

Net Debt 119 134 154

Net Debt/EBITDA 2.84x 2.58x 2.62x

Total Assets 207 346 373

Net Debt/Assets 0.58x 0.39x 0.41x

Capital Employed 213.3 263.6 298.0

ROCE* 13.7% 13.5% 13.9%

Sales/CE ratio 0.99x 1.05x 1.11x

% Equity 32.9% 31.5% 34.0%

Dividend Payout 57.7% 47.6% 48.6%

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Profit Development 2008-20 11

80 69 70

60 47

50 ~ 0 40 \/'I ::::>

30

20 26 25 10 21

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2008 2009 2010 2011

~ Gross - EBIT ~ EBITDA ~ Net

AVGOL Nonwovens

Key Highlights

Continued year over year growth during 2011

2011 Compared to 2010:

18.8% growth in Revenues to 329.6 M$.

14.6% growth in Gross Profit to 69.0 M$.

16.2% growth in EBIT to 41.3 M$.

13% growth in EBITDA to 58.9 M$.

17.6% growth in Net Profit to 24.7 M$. Source: Company Financial Reports

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Revenue Breakdown by G,eogra 1phy

Nort h Am er i:ca Europe & Russia Ch"ina

• 2010 • 2011

Ot her

AVGOL Nonwovens

Revenue Breakdown

5%

94%

Avgol increasing its sales in China by 94% compared to 2010

70%

Source: Company Financial Reports

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2010 COGS Breakdown 2011 COGS Breakdown

• Materials • Materials

• Labor • Labor

• Electricity & Local Taxes • Electr icity & Local Taxes

• Maintenance & Insurance • Maintenance & Insurance

• Freight • Freight

• Depreciation • Depreciat ion

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Cost of Goods Sold (COGS)

The rise in Polypropylene prices during the beginning of 2011,

increased the materials portion from the total COGS expenses in 2011

compared to 2010.

Source: Company Financial Reports

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20,500

18,500

16,500

14,500

g 12,500 0 lll 10,500 :J

8,500

6,500

4,500

2,500 00 0 0 N M Cf

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G1ross Profit & Ope 1rat ing Profit devel lopment

• Gross • Operating

00 00 00 m m m m 0 0 0 0 0 0 0 0 0 0 0 M M M M 0 0 0 0 0 0 0 0 0 0 0 N N N N N N N N N N N

c1 m q- M c1 m q- M c1 m q-Ci CJ Ci Ci CJ Ci Ci CJ

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AVGOL Nonwovens

Quarterly Profit Development

Source: Company Financial Reports

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Cash Flow

USD Million 2010 2011

Current Operations

Net Income 21.2 24.7

Depreciation/Amortization 16.7 17.7

Other non-CF income/expenes 3.5 4.8

Change in Working Capital -5.6 -9.5

Net CF from Current Operations 35.9 37.7

Investments Activities

CAPEX -35.1 -40.9

Purchase of Intangible assets -1.5 -0.9

Other - -2.5

Net CF from Investments Activities -36.6 -44.3

Financing Activities

Increase (decrease) in ST Bank Loans 4.7 18.0

Repayment of LT Bank Loans & Bonds -33.9 -34.0

Receipt of LT Bank Loans & Bonds 45.0 35.0

Purchase of Minority Intrests -2.9 -

Dividend Paid -8.0 -10.0

Net CF from Financing Activities 4.9 9.0

Increase in Cash & Cash equivalents 4.1 2.4

Closing Balance 17.0 19.1

FY

Source: Company Financial Reports ST = Short Term; LT = Long Term

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• The hygiene industry is one of the most stable, non-cyclical industries in the global

economy.

Hygiene Market Highlights

• Baby diaper penetration globally is at 23% (2010)!! Great opportunity for growth.

NA, EU, Japan ~ 100%. LatAm ~ 65%, China ~ 20%, India ~ 3%, Africa ~1%

• Aging population in developed world is creating growth also in mature markets.

In some countries fabric demand for Adults > Baby diapers.

• Altogether the market is growing at ~4% / year. China, Russia, LA growing faster

• 2010 market size - ~1,200,000 MT.

Avgol - ~8.5% in 2010, ~10% in 2013.

• 5 global customers represent ~75% Market Share

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Courage and Pioneering Spirit

Our Strengths

Able to “Genetically Reproduce”

Our Model, Products and Service Globally, Even in Tough Geographies

Global Presence Customer Focus

Technology Mastery & Innovation

AVGOL Non wovens

Thank you