HEALTH NUTRITION MATERIALS

ROYAL DSM

MaterialsDimitri de Vreeze | Member of the Managing Board

Safe harbor statement

▪ This presentation may contain forward-looking statements with respect to DSM’s future (financial) performance and

position. Such statements are based on current expectations, estimates and projections of DSM and information

currently available to the company. DSM cautions readers that such statements involve certain risks and uncertainties

that are difficult to predict and therefore it should be understood that many factors can cause actual performance and

position to differ materially from these statements. DSM has no obligation to update the statements contained in this

presentation, unless required by law.

▪ A more comprehensive discussion of the risk factors affecting DSM’s business can be found in the company’s latest

Annual Report, which can be found on the company's corporate website, www.dsm.com

An attractive Materials portfolio was created

Page 1

1. Whilst not part of the cluster, the Emerging Business Areas of DSM Biomedical and DSM Advanced Solar are also related to Materials and represent promising

growth platforms for the longer term

▪ Transformed portfolio

– Focus on sustainable specialty

products

– Exit of Bulk Chemicals via

partnership

▪ Differentiated approach to drive

growth

▪ Optimized portfolio via cost savings

and efficiency improvements

▪ Increased application development

capabilities

High Low DSM’s capability to extract value

Mark

et

gro

wth

- DSM Engineering Plastics

- DSM Dyneema

- DSM Resins & Functional Materials

- Emerging Business Areas

High

High Performance

Plastics

Biomedical

Functional

Materials

Dyneema® Fiber

Solutions

Specialty

Coating

Resins

Solar

Dyneema®

Life Protection

Strengthen

Accelerate

Powder

Coating Resins

PA6

Polymers

PA6

Compounds

Acrylonitrile

Composite

Resins

Caprolactam

Restructure

High-quality Materials portfolio now ready for accelerated growth

Page 2

1. Divestitures include Composite Resins (~€300m sales), Euroresins (~€80m sales) and Synres (~€60m sales)

CAGR ~2.5% per annum Adj. EBITDA up almost 50% Strong progress margin &

ROCE

Adj. EBITDA margin:

12%ROCE: 10%

2010

Adj. EBITDA margin:

15.2%ROCE: 14.4%

2015

~€2.1bn2010

>€2.5bn2015

€259m2010

€384m2015

Divested

~€0.4bn1

Divested

~€24m1

2010-15 performance

Using a differentiated approach, Strategy 2018 focused on the higher-

growth, specialty segments

Page 3

1. Whilst not part of the cluster, the Emerging Business Areas of DSM Biomedical and DSM Advanced Solar are also related to Materials and represent promising

growth platforms for the longer term

High Low

High-Performance

Plastics

Biomedical1

Functional

Materials

Specialty Coating

Resins

DSM’s capability to extract value

Mark

et

gro

wth

Solar1

Dyneema® Life

Protection

Growth

Accelerated

growth

Powder

Coating Resins

PA6 HV

Film & extrusion

PA6

Injection molding

- DSM Engineering Plastics

- DSM Dyneema

- DSM Resins & Functional Materials

- Emerging Business Areas

High

Maximize

returnsDyneema®

Fiber Solutions

Strategy 2018 aspirations

▪ High single-digit percentage

annual Adjusted EBITDA

growth

▪ High double-digit basis point

annual ROCE growth

▪ EBITDA margins >15% over the

period

▪ Above-market sales growth (at

stable prices)

Prudent capital allocation: capex and R&D investments shifted to the

high-growth segments

Page 4

Accelerated growth Maximize returnsGrowth

0

50

100

150

2011 2015 2017E

0

100

200

300

400

500

2011 2015 2017E

0

50

100

150

2011 2015 2017E

Capex (€m) Capex (€m) Capex (€m)

0

50

100

150

2011 2015 2017E

0

50

100

150

2011 2015 2017E

0

50

100

150

2011 2015 2017E

R&D (€m) R&D (€m) R&D (€m)

Differentiated growth approach is further enhancing the mix

Page 5

Accelerated growth Maximize returnsGrowth

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

0

200

400

600

800

1,000

1,200

1,400

2011 2015 2017E

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

0

100

200

300

400

500

600

2011 2015 2017E

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

0

200

400

600

800

1,000

1,200

1,400

2011 2015 2017E

Net sales (€m) Net sales (€m) Volume (kt)

6%~7% 5%

~7%

1%~-1%

x% CAGR

30% 34% 35% 38% 41% 42% 32% 25% 23%

x% % of total Materials salesEBITDA%

Target

>15%

Very good progress on executing Strategy 2018 actions

Page 6

1. As reported

✓ ✓Above market growth Adj. EBITDA margin >15% over the period

12.0%

17.3% 16.9%

0%

5%

10%

15%

20%

25%

30%

Avg. 2010-15 2016 H1 2017

~2.0%

4.0%

8.0%

0%

2%

4%

6%

8%

10%

2011-15CAGR

Market2016-18

2016 H1 2017 1

Resulting in outperformance of the Strategy 2018 aspirations

Page 7

✓ ✓High single-digit percentage annual

Adjusted EBITDA growth

High double-digit basis point annual

ROCE growth

384435

212241

0

100

200

300

400

500

2015 2016 H1 2016 H1 2017

14%

13%

14.4%

17.6% 16.9%19.5%

0%

5%

10%

15%

20%

25%

2015 2016 H1 2016 H1 2017

€m

260bps320bps

Materials aims to continue sales growth and operating leverage

improvements

Page 8

▪ Sales growth driven by:

– Demand shifts from macro trends

– Substitution growth

– Innovation driven growth

– New applications

1 2▪ Improving operating leverage through:

– Maximizing returns in PA6 HV film &

extrusion and powder coating resins

– Prudent cost and capital allocation

Materials positioned to profit from demand shifts as a result of

the (societal) megatrends

Page 9

1

Future of transport Eco-materialsRenewable energy

Higher performance and

more complex materials

needed for use in new

designs, energy storage,

autonomous systems and

light weighting

Advanced healthcare Sustainable packagingCustomization & connectivity

Increasing complexity and

electronics integration

drives material performance

requirements for materials

used inside and outside the

body

Demand for materials that

contribute to material

properties for each

technology generation in

wind, solar, and energy

storage

Shift towards bio-based, re-

usable, recyclable,

degradable, no VOCs and

other green materials and

design for a circular

economy

Need for new types of

performance materials e.g.,

for 3D printing and possibly

new business models (e.g.,

direct access for

personalized product

design)

Higher barrier properties,

recyclability and bio-

degradability (incl. design

for circular economy)

becoming more important

for packaging materials

‘Winning segments’ selected to further drive differentiated

growth from substitution-based development

Page 10

Automotive ElectronicsLife

ProtectionFiber

SolutionsSustainable

CoatingsFunctional Materials

Replace metals &

hazardous materialsReplace steel/aluminum & aramids Environmentally friendly solutions

DSM Engineering Plastics DSM Dyneema DSM Resins & Functional Mat.DSM

Biomedical

Replace traditional

solutions

Regenerative Biomaterials

DSM Advanced

Solar

Fossil fuel

replacement

Solar

Growth via end markets and substitution based on application development

1

Strong innovation pipeline driven by application development

with/ for customers driving longer-term growth

Page 11

Engineering Plastics Resins & Functional MaterialsDyneema

▪ Bio-based

resins

▪ Recyclable

carpets

▪ 3D printing▪ Synthetic

chains

▪ Carbon hybrid

composites

▪ Performance

fabrics

▪ HPPO

polymers

▪ Printed

electronics

▪ High-heat

thermoplastics

▪ High-pressure

composite

tanks

1

▪ ‘Haptics – the

feel of

coatings’

Continue cost and capital discipline to further improve operating

leverage

Page 12

2

Improve operating leverage through:

▪ Maximizing returns in PA6 HV film & extrusion

and powder coating resins

– Fully utilize/ optimize the assets

– Drive internal compound demand

(Engineering Plastics)/ sustainable

substitution demand (Resins)

▪ Prudent cost and capital allocation

– Continue cost, capex and working capital

discipline in Materials

▪ Sales growth driven by:

– Demand shifts from macro trends

– Substitution growth

– Innovation driven growth

– New applications

1 2▪ Improving operating leverage through:

– Maximizing returns in PA6 HV film &

extrusion and powder coating resins

– Prudent cost and capital allocation

Materials is confident it can continue its value enhancing ‘silent’

transformation

Page 13

▪ Delivering sales growth of ~5%

▪ Continuation of the ‘silent’ transformation in Materials with the aim to deliver

resilient margins above the Strategy 2018 aspiration of 15%