HAMON : 2013 consolidated annual results

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● First mega order in the US market for the ReACT TM technology.

● Sales growth + 11% compared to 2012 but still below our expectations.
● The Group growth activities (i.e. mostly Dry Cooling and APC outside NAFTA) had a much lower negative impact on the Group's profitability than in 2012 (EBITDA of EUR -6,7 million compared to EUR -14,0 million in 2012).
● High tax rates in some countries like the USA and the prudent decision not to recognize Tax Assets in some loss-making subsidiaries lead to an excessive tax burden and a net loss of EUR -5,7 million (Group share).

In view of the general economic environment, Hamon does not release any guidance on its future results.

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Table of Contents

I. REVIEW OF THE YEAR 2013 ..........................................................................................2
1. Commercial activities ......................................................................................................2
2. Consolidated income statement .......................................................................................2
3. Overview by business unit ...............................................................................................3 a) Cooling Systems ..........................................................................................................3
b) Process Heat Exchangers .............................................................................................4 c) Air Pollution Control EMEA - Brazil .........................................................................4 d) Air Pollution Control & Heat Recovery NAFTA ........................................................5 e) Chimneys .....................................................................................................................5
4. Consolidated balance sheet ..............................................................................................6
5. Post balance sheet events .................................................................................................6
6. Auditor's report................................................................................................................6

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limited and sporadic domestic market.
With EUR 678,3 million of bookings, the Group registered in 2013 its best performance of the last ten years. Moreover, new orders were well spread across all Business Units except Chimneys which still has to operate in a
Traditional markets (i.e. Western economies) which recently represented less than fifty percent of our total bookings thanks to the success of our commercial developments in emerging markets, finally stood at 59% in 2013 thanks to several major orders in the energy sector in the US and Europe.
The backlog, at EUR 748,2 million, benefited from this very high level of bookings. New orders and backlog shown above exclude intersegment activities.

Results in EUR per share

Average number of shares 7.189.772 7.191.472

EBITDA per share 2,74 2,36

Earnings per Share (EPS) -0,78 -0,36

EBITDA in % of revenue 3,8% 3,6% EBIT in % of revenue 1,9% 1,9%

Revenue increase (+11% compared to

2012) combined with a noticeable decrease of our Net operating expenses (thanks to higher volume and heavy workload) and a much lower cost of our Growth activities more than compensated the gross margins decrease (-2,4%) linked to the constantly increasing share of large and/or turn-key contracts in our revenue.
All of those, together with a relatively stable impact of foreign currency exchange on trading activities (respectively EUR +0,3 million and EUR
-0,4 million for the years 2013 and 2012) allowed the Group to increase its EBITDA by 16,1% or EUR 2,7 million compared to last year.
However, higher non-recurring items, finance costs (mostly related to un-

Result before tax (continued operation)

in % revenue

-0,2% 0,5%

realized currency translation losses on
inter-company loans) and an excessive

Net result for the year in % revenue -1,4% -0,4%

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tax burden did unfortunately not allow to end the year with a net profit.
Detailed explanations of the activities during this year are available in the analysis by Business Unit.

The new orders booked by the Cooling Systems in 2013 amounted to EUR 253,7 million, including inter alia:

 A turnkey contract for the construction of a Natural Draft Cooling Tower with gas injection in
Poland;
 3 contracts signed in China for the engineering and equipment of 6 Natural Draft Cooling Towers;
 2 contracts for the construction of air-cooled condensers for two power plants of 2 x 660 MW each in China;
 Contracts signed with Korean EPCs for the construction of Mechanical Draft Cooling Towers in
Korea and Central Asia;
 2 contracts signed for the construction of air cooled condensers in the UK and Mexico;
 Multiple service contracts consolidating our position in customer service in Western Europe.
Thanks to this excellent commercial performance, the backlog end of 2013 still represents more than one year of activity.
Revenue, at EUR 262,3 million, confirms our market leader position and the growing trend in our bookings despite the global economic situation. This increase in revenue is mostly driven by the timely execution of our two major dry contracts in the Middle East.
The relaunch of the dry cooling activity starts to bear its fruits with an organization which is now stabilized, however the Business Unit EBITDA decreased compared to last year mainly due to a difficult economic situation in India (financial crisis, Rupee depreciation,…) and difficulties to manage export contracts with Korean EPCs.
The additional headcount is mostly explained by the development of our plant in China, which is fully loaded, and by site personnel for the execution of our big projects.

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New orders booked by the Process Heat Exchangers BU have improved even if the second half of the year was affected by longer lead times taken by most customers to finalize their decisions to order.

Revenue have been slightly affected by the lower bookings of the second part of the year and by a longer execution of some contracts.

The closure of the JV in Korea and start-up of our own production facility in Korea led to costs that also substantially affected the Business Unit EBITDA margin.

The headcount increase comes from the start-up of our own production plant in Korea.

Nevertheless, the gross profit and EBITDA margins remained at a good level when considering the difficult global economy.

As anticipated at mid-year, the booking level of the Business Unit has reached a record high level with an increase of
135% compared to the previous year bookings. This has been achieved by:
 Major successes in our traditional markets in Europe where, although the market level is low, our share has been very high both in France, thanks to a major award from EDF, and in Eastern Europe where our Business Unit has been awarded one of the biggest Electrostatic Precipitators ("ESP") for a 1.050 MW Coal Fired Boiler in Poland.
 The increase of our presence in the promising Asian markets with the award of a large Fabric
Filter for a Coal Fired Boiler.
 Diversification of the activities of our Chinese office into the ESP market with several contracts awarded in the domestic Oil & Gas market.
 Success with Korean EPC contractors for equipment to be supplied for an Oil fired Power
Plant in Vietnam.
Although the bookings are at historically high level, the timing and schedule of execution of these projects did not allow much revenue recognition during the year. Combined with a low opening backlog, the total revenue of 2013 stayed at a level that did not generate enough contribution to cover our fixed costs.

Nevertheless, the last quarter of 2013 has seen the return to profit of the Business Unit.
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During the year, resources have been re-allocated to the active markets allowing us to be prepared for the execution of the large backlog without increasing the BU net operating costs.

The good level of backlog and nice level of potential orders to come are nevertheless extremely encouraging and augur well for a return to profitability.

The Business Unit continues to generate outstanding results despite the limited coal fired opportunities in the NAFTA region. Bookings increased more than seventy percent and EBITDA increased by over sixty percent when compared with 2012. Backlog is also at an all-time high.
Bookings include the first order for ReACT™ in the NAFTA region as well as orders for Heat Recovery Steam Generators, Recuperators, Industrial Boilers, ESP Upgrades and multiple After Market services awards.
The BU continues to produce strong EBITDA margins at 12,4%.

Nuclear Power Plant.
Despite the fact that the market for new chimneys remains in a state of flux, this Business Unit continues to produce good results. Also, its strategic regional presence results in a steady flow of after- market business.
In addition to chimneys, the Business Unit is currently erecting two natural draft cooling towers at the Vogtle

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The additional working capital needs requested by the growth of our activities in new markets and products were successfully financed through a non- recourse receivable disposal programs. As a result, the net working capital decreased compared to last year despite those extra needs.

Equity, at EUR 68,1 million, was impacted both by the net loss of the year and the exchange rate fluctuations that reduced the reporting value in EUR of the assets and liabilities of our foreign operations (mainly USA).

On January 24, Hamon completed the offering of EUR 55 million senior bonds due in 2020 and guaranteed by some of its subsidiaries. The offering was oversubscribed. The Bonds have been issued at 100 per cent of the par on 30 January 2014 and will be redeemed at par on 30 January 2020.
The proceeds of the offering will be used in full in partial prepayment and cancellation of the revolving credit facility of the 2011 facility agreement, allowing a corresponding increase of the letters of credit facility in order to support the development of the Group's activities.
For more information about this transaction, please refer to the Press Release issued on January 24 which is available on our website.

The auditor, Deloitte Reviseurs d'entreprises SC s.f.d. SCRL represented by Pierre-Hugues Bonnefoy, confirmed that the accounting information included in this press release does not require any qualification and is in accordance with the financial statements approved by the board of directors.

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in EUR '000'

2012

Revenue

Cost of sales

Gros s profit

474.408 (397.766)

Sales & marketing costs General & administrative costs Research & development costs

Other operating income / (expenses)

Ope rating profit be fore non-re curring ite m s (REBIT)

Depreciation & amortisation

EBITDA

Restructuring costs

Impact of Changes in consolidation scope

Impairment / reversal of impairment on non-current assets

Other non-recurring items

Ope rating profit (EBIT)

Interest income

Interest charges

Re s ult be fore tax

Income taxes

Ne t re s ult from continue d ope rations

Net result of discontinued operations

Ne t re s ult

Equity holders of the company

Non controlling interests

Ear nings pe r s har e

Continue d and dis continue d ope rations

Basic earnings per share (EUR) Diluted earnings per share (EUR)

Based on their strike price, the stock options granted to Group employees have no dilutive impact at period(s) end.

Continue d ope rations

Basic earnings per share (EUR) Diluted earnings per share (EUR)

in EUR '000'

Ne t re s ult

2012

Ite m s that m ay be re clas s ifi e d s ubs e que ntly to re s ult Reclassif ication of previously recognized changes in f air value of available-f or-sale assets to net result

Change in f air value of hedging instruments Changes in currency translation reserve Actuarial gains/loss on def ined benef it plan Com pre he ns ive incom e

Equity holders of the company

Non controlling interests

7

(6.783)

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in EUR '000'

31/12/2012

ASSETS

Non-curre nt as s e ts Intangible assets Goodw ill

Property, plant & equipment

Def erred tax assets

Available-f or-sale f inancial assets

Trade and other receivables

Derivative f inancial assets

21.957

53.219

43.548

14.973

2.351

2.724

-

Curre nt as s e ts

Inventories

Amount due f rom customers f or contract w ork

Trade and other receivables Derivative f inancial assets Cash and cash equivalents

Current tax assets

Available-f or-sale f inancial assets

Total as s e ts

EQUITY

Share capital Reserves Retained earnings

Equity attributable to the e quity holde rs of the com pany

Non controlling inte re s ts

Total e quity

1.892

15.102

54.475

LIABILITIES

Non-curre nt liabilitie s Financial liabilities Provisions f or pensions

Provisions f or other liabilities and charges

Def erred tax liabilities

Other non-current liabilities

Curre nt liabilitie s

Financial liabilities

Amount due to customers f or contract w ork

Trade and other payables Current tax liabilities Derivative f inancial liabilities

Provisions f or other liabilities and charges

Total liabilitie s

Total e quity and liabilitie s

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in EUR '000'

Share capital

Legal reserve

Share premium

Retained earnings

own shares

AFS

reserve

Share- based payments

Hedging reserve

defined benefit pension plan

Currency translation reserves

Equity - Attribuable to equity holders of the parent

Non controlling Interests

Total equity

Balance at 1 January 2011 1.892 671 14.550 58.519 - 2.275 108 (16) - 1.601 79.600 6.538 86.138

Balance at 1 January 2011 1.892 671 14.550 58.519 - 2.275 108 (16) (405) 1.601 79.195 6.473 85.669 after restatement

Capital increases - - - - - - - - - - - 1.028 1.028

Comprehensive income - - - 2.843 - (1.148) - - (18) 1.637 3.314 419 3.733

Dividends paid to shareholders - - - (3.380) - - - - - - (3.380) (44) (3.424) Change in share based payments reserve - - - - - - 45 - - - 45 - 45

Other movements - - - 12 - - - 16 - (16) 12 (14) (2)

Balance at 31 December 2011 1.892 671 14.550 57.993 - 1.127 153 - (422) 3.222 79.186 7.863 87.049

Balance at 1 January 2012 1.892 671 14.550 57.980 - 1.127 153 - - 3.222 79.595 7.927 87.522

Balance at 1 January 2012 1.892 671 14.550 57.993 - 1.127 153 - (422) 3.222 79.186 7.863 87.049 after restatement

Capital increases - - - - - - - - - - - 581 581

Comprehensive income - - - (2.584) - (1.123) - (1.177) (274) (1.625) (6.783) 43 (6.740) Dividends paid to shareholders - - - (935) - - - - - - (935) (251) (1.186) Other movements - - - 1 - - - - - - 1 (2) (1) Balance at 31 December 2012 1.892 671 14.550 54.475 - 4 153 (1.177) (696) 1.597 71.469 8.234 79.703

Balance at 1 January 2013 1.892 671 14.550 54.522 - 4 153 (1.177) - 1.597 72.212 8.291 80.503

Balance at 1 January 2013 1.892 671 14.550 54.475 - 4 153 (1.177) (696) 1.597 71.469 8.234 79.703 after restatement

Capital increases - - - - - - - - - - - 834 834

Comprehensive income - - - (5.625) - - - 420 346 (2.873) (7.732) (2.950) (10.682) Dividends paid to shareholders - - - - - - - - - - - (29) (29) Other movements - - - - (92) - - - - (2) (93) (1.614) (1.707) Balance at 31 December 2013 1.892 671 14.550 48.850 (92) 4 153 (757) (350) (1.278) 63.644 4.475 68.119

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in EUR '000'

Cash flows from operating activities

Cash received from customers

Cash paid to suppliers and employees

2012

448.906 (432.800)

Cash generated from operations before taxes

Other financial expenses and income (paid)/received

Income taxes paid

16.106 (1.937) (7.768)

Net cash from operating activities

Restructuring costs

Net cash from operations after restructuring

6.401

(1.018)

Cash flows from investing activities

Dividends received

Proceeds on disposal of PP&E

Proceeds/(Purchase) of available for sale financial assets Acquisition of Subsidiaries (net of cash acquired) Acquisition of PP&E

Disposal/(purchase) of other intangible assets

Capitalized development costs

Net cash from investing activities

Cash flows from financing activities

Dividends paid to shareholders

Dividends paid to non controlling interests

Proceeds from issuance of shares to non controlling interests

Interest received

Interest paid

Proceeds from new bank borrowings

Repayment of borrowings

Net cash from financing activities

Other cash flow mouvements

Other variations from discontinued operations

Other net cash flows

Net variation of cash and cash equivalents

Cash and cash equivalents at beginning of period

Impact of translation differences

Cash and cash equivalents at end of period

Net variation of cash and cash equivalents

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This presentation contains forward-looking information that involves risks and uncertainties, including statements about Hamon's plans, objectives, expectations and intentions. Readers are cautioned that forward-looking statements include known and unknown risks and are subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of Hamon. Should one or more of these risks, uncertainties or contingencies materialize, or should any underlying assumptions prove incorrect, actual results could vary materially from those anticipated, expected, estimated or projected. As a result, neither Hamon nor any other person assumes any responsibility for the accuracy of these forward-looking statements.

For all additional information, please contact :

Publication of the full year 2013 results 28/02/2014
Annual Shareholders Meeting 2014 22/04/2014

Trading update Q1 2014 22/04/2014

The Hamon Group is a world player in engineering & contracting (design, installation and project management). Its activities include the design, the manufacturing of critical components, the installation and the after-sale services of cooling systems, process heat exchangers, air pollution control (APC) systems, heat recovery steam generators and chimneys, used in power generation, oil

& gas and other heavy industries like metallurgy, glass, chemicals.

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