KUKA AG

Small/Mid-Cap: Capital Goods & Industrial Engineering

Systems deconsolidation fully priced in

We increase our KUKA price target by 10.3% to EUR32 on adjusted

estimates and an update to our SOTP model. However, we maintain our Hold recommendation. We believe KUKAs share price already fully reflects any initial benefit from potential deconsolidation of the systems business. Valuation appears full: We believe the shares are fully valued for the following reasons: 1) the benefit from a potential deal with Swisslog for KUKAs systems business is fully priced in; 2) even a scenario assuming a take-out multiple leaves only 16% upside in our view; and 3) FY 2013 does not leave room for consensus upgrades while KUKA is trading at peak earnings and multiples. While a pure-play robotics KUKA would be an attractive take-over target, the likelihood and timing of such a scenario materialising are highly uncertain. To argue for a premium to the current share price based on fundamentals, we would have to value KUKA by discounting back FY15E sales and earnings (both at peak levels) and using multiples above the current peak levels. In light of decreasing earnings visibility for a standalone robotics business (lower order book and lead times than systems), we see this as unjustified. No earnings upgrades expected: Furthermore, we do not see room for further FY13 earnings upgrades as robotics margins are set to decrease on mix effects and upside to peak systems margins appears limited. Consensus already reflects the full margin and growth potential in our view. Rich multiples: The KUKA share price has increased 21% year to date after rising 92% in 2012. At forward multiples of 18x P/E and 10.5x EV/EBIT, KUKA is trading at five-year (excluding the crisis) highs. Furthermore, EV/sales of 0.7x versus an EBIT margin of 6.4% does not leave further upside in our view. Based on our updated SOTP assumptions (multiples, net debt) and minor earnings adjustments, our new price target is EUR32.
2009 2010 1,142 1.06x 1,079 47 25 -9 60 -0.28 0.29 0.00 18.9% 4.4% 2.3% 0.0% 4.4% 0.5 10.8 20.4 42.2 5.2% 2011 1,553 1.08x 1,436 99 73 30 33 0.89 0.89 0.00 19.6% 6.9% 5.1% 0.0% 13.0% 0.4 6.5 8.8 18.2 8.1% 2012E 1,890 1.09x 1,739 137 110 59 23 1.75 1.75 0.25 19.4% 7.9% 6.3% 0.8% 16.8% 0.7 8.9 11.1 18.9 6.2% 2013E 1,768 0.99x 1,783 142 114 63 -3 1.86 1.86 0.30 20.4% 8.0% 6.4% 0.9% 15.4% 0.7 8.4 10.5 17.8 6.5% 2014E 1,813 0.98x 1,845 154 122 70 -25 2.06 2.06 0.40 20.4% 8.3% 6.6% 1.2% 14.8% 0.6 7.6 9.6 16.2 7.3%

Hold
Rating system Current price Absolute Price target

EUR 34.11

EUR 32.00

08/03/2013 XETRA Close Market cap EUR 1,126 m Reuters KU2G.DE Bloomberg KU2 GY Changes made in this note Rating Hold (no change) Price target EUR 32.00 (29.00) Chg
2012e 2013e old % old % 1714 1775 0.5 Sales 103 112 2.2 EBIT 1.54 1.76 5.7 EPS Source: Berenberg Bank estimates 2014e old % 1836 0.5 119 3.0 1.93 6.6

Share data

Shares outstanding (m) Enterprise value (EUR m) Daily trading volume

34 1,220 120,400 35 15 SDAX 5.6 % 5.1 % 101.0 % 3.7 7.4 % 8.7% 32.2%

Performance data
High 52 weeks (EUR) Low 52 weeks (EUR) Relative performance to SXXP 1 month 4.2 % 3 months 18.0 % 12 months 107.9 %

Key data
Price/book value Net gearing CAGR sales 2011-2014 CAGR EPS 2011-2014

Y/E 31.12., EUR m

Order intake 903 Book-to-bill 1.00x Sales 902 EBITDA -29 EBIT -53 Net profit -76 Y/E net debt (net cash) 48 EPS (reported) -2.95 EPS (recurring) -0.54 DPS 0.00 Gross margin 17.7% EBITDA margin -3.3% EBIT margin -5.8% Dividend yield 0.0% ROCE -10.8% EV/sales 0.4 EV/EBITDA -13.5 EV/EBIT -7.5 P/E -20.0 Cash flow RoEV -8.8% Source: Company data, Berenberg Bank

Business activities:
Plant engineering of automated production lines () and industrial robots (1/3)

Non-institutional shareholders:
Grenzebach Maschinenbau 24.4% Wyser-Pratte 4.7% Rinvest 1.8%

11 March 2013 Benjamin Glaeser

Analyst +44 20 3207 7918
benjamin.glaeser@berenberg.com

Felix Wienen
Analyst +44 20 3207 7915 felix.wienen@berenberg.com

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

No upside left on fundamentals on a 12-month view

We have consistently highlighted the potential deconsolidation of KUKAs systems business into Swisslog, which shares its largest shareholder (Grenzebach) with KUKA. Such a deal would in our view allow KUKA to focus on growth in its robotics division, lead to a re-rating of the remaining business towards robotics multiples and make the company an attractive take-over target. Considering the current share price, we believe most of these potential benefits have already been factored in. We use two valuation scenarios to demonstrate this: 1) a fair value valuation following deconsolidation of systems; and 2) a take-out valuation following successful deconsolidation. The deconsolidation case In our view, the most likely case for a deconsolidation of the systems business into Swisslog would leave KUKA with a share in the new business. This would allow KUKA to retain access to the intricate details of production set-ups at its largest OEM clients and allow it to continue to benefit from growth of the business, in which it has invested heavily in recent years (we would expect c.EU10m investment income initially). In this scenario, we arrive at a fair value of EUR33.15 per share, implying a slight discount to the current share price. Valuation for pure-play robotics KUKA
Robotics Swisslog stake KTPO Group EV Net debt Fair share price EUR990m EUR140m EUR90m EUR1,220m -EUR96m EUR33.15 Assuming 11x EV/EBIT; EUR750m in sales and the 12% margins based on our assumption of 35% share in new Swisslog business based on DCF fair value Group EV ex systems prepayments and including pension provisions Equity value per share

Source: Berenberg Bank estimates

Robotics EV: The remaining robotics business would have around EUR750m in sales with a target margin of 12%. Assuming KUKA is able to achieve this margin and using a through-the-cycle EV/EBIT peer multiple of 11x (Fanuc, Yaskawa, ABB), this would imply a fair robotics EV of EUR990m. Swisslog stake: We believe it is reasonable to assume that KUKA would hold 35% of the new Swisslog business (splitting it by recurring EBIT contribution). This would increase by c.EUR140m if the new Swisslog business were valued at 16x P/E (with a new EPS of CHF0.12). KTPO: Furthermore, we believe KUKA would retain its KTPO business (operating body-in-white production for the Jeep Wrangler). We estimate an annual EBIT contribution of EUR15m, as currently consolidated in the systems business. Since KUKA has a contract to operate this until 2020, we calculate a simple DCF value of EUR90m for this income stream. Net debt: While KUKA moved to a net cash position at the end of 2012 (EUR45m), we also take into account the EUR71m pension obligation and our belief that most prepayments are related to the systems business. At the end of FY 2011, these amounted to c.EUR67m but should be higher now considering systems sales growth of 22% in FY 2012 (we estimate EUR70m). Overall, we therefore arrive at a net debt position including pension liabilities of EUR96m.

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

The take-out scenario Following this deconsolidation, a pure-play robotics KUKA could be an attractive take-over target for e.g. Siemens (which uses KUKA robots in its Healthcare division and supplies a number of components) or an international industrial conglomerate looking to broaden its exposure to automation in China in particular. As a blue sky take-out assumption, we apply a 1.6x EV/sales multiple to current robotics sales of EUR750m. KUKA currently trades at 0.7x sales with a mediumterm margin target of 12% in robotics. EV/sales of 1.6x thus presents a decent premium to current levels. We would thereby arrive at a robotics EV of EUR1,170m. Using the above assumptions for net debt and the remaining business (Swisslog stake and KTPO), we derive a take-out price of EUR39. Given the level of uncertainty attached to this scenario (whether a deal with Swisslog happens, and if and when KUKA could be taken over), we would not regard the implied 17% upside as sufficient to justify buying the share. Valuation our actual price target, not accounting for any of the above We slightly adjust our estimates following the FY 2012 results (see segment estimates on next page). Our Robotics margin forecast is now 11.5% for FY 2015, with Systems margins improving to 5.2%. On adjusted estimates and an update to our SOTP assumptions, our 12-month price target increases to EUR32 (weighting FY 2013 and FY 2014 results equally). At 18x FY13 P/E and EV/sales of 0.7x compared to 6.4% EBIT margins, we believe valuation appears stretched. SOTP model
FY13E ROBOTICS ADVANCED ROBOTICS SYSTEMS KTPO ./.. Consolidation Enterprise Value KUKA + + Liquid funds Financial assets Interest bearing liabilities Pension provisions Prepayments Minorities Fair Equity Value KUKA Numbers of shares Fair value per share 933 266 96 -108 1,187 262 8 266 72 55 1 1062 33.9 31.33 FY14E Valuation EV/EBIT '13 11.5 7.0 5.0 EV/EBIT '14 12.0 7.0 5.0 1070 EV/EBIT-multiple EV/EBIT-multiple 270 EV/EBIT-multiple 96 DCF -122 EV/EBIT-multiple 1,315 278 8 265 73 55 1 1206 33.9 35.57

Source: Berenberg Bank

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Segment forecasts
in EURm ROBOTICS Order intake yoy book-to-bill Order backlog yoy Revenues yoy EBIT yoy margin SYSTEMS Order intake yoy book-to-bill Order backlog yoy Revenues yoy EBIT yoy margin Consolidation Order intake Revenues EBIT KUKA GROUP Order intake yoy book-to-bill Order backlog yoy Revenues yoy EBITDA yoy margin EBIT yoy margin Source: KUKA AG, Berenberg Bamk Source: KUKA AG, Berenberg Bank 2008 2008 464 6.8% 0.98x 100 -3.6% 474 14.9% 42.0 25.0% 8.9% 2008 855 -8.8% 1.02x 450 6.0% 839 -6.8% 26.8 -28.0% 3.2% 40 -47 -16.8 1,280 -4.8% 1.01x 542 2.6% 1,266 -1.6% 78.0 -21.6% 6.2% 52.0 -26.1% 4.1% 2009 2009 324 -30.2% 0.98x 100 0.0% 331 -30.3% -11.5 -127.4% -3.5% 2009 615 -28.0% 1.02x 460 2.2% 606 -27.8% -29.1 -208.6% -4.8% 36 -34 -12.3 903 -29.4% 1.00x 544 0.2% 902 -28.7% -29.8 -138.2% -3.3% -52.9 -201.7% -5.9% 2010 2010 486 49.9% 1.12x 149 48.7% 436 31.8% 20.8 -280.9% 4.8% 2010 717 16.5% 1.03x 500 8.6% 695 14.8% 20.0 -168.7% 2.9% 61 -52 -16.0 1,142 26.5% 1.06x 631 16.0% 1,079 19.6% 39.8 -233.8% 3.7% 24.8 -146.9% 2.3% 2011 2011 654 34.6% 1.06x 184 23.8% 616 41.5% 51.0 145.2% 8.3% 2011 917 27.9% 1.08x 545 9.0% 851 22.4% 33.7 68.5% 4.0% 4.0% 18 -31 -12.1 1,553 36.0% 1.08x 724 14.8% 1,436 33.1% 90.3 126.7% 6.3% 72.6 192.7% 5.1% 2012E 2012E 803 22.7% 1.08x 249 34.9% 743 20.5% 80.2 57.3% 10.8% 10.8% 2012E 1,115 21.7% 1.09x 666 22.2% 1,025 20.5% 47.7 41.5% 4.7% 5.0% 29 29 -18.1 1,890 21.7% 1.09x 909 25.6% 1,739 21.1% 123.4 36.7% 7.1% 109.8 51.2% 6.3% 2013E 2013E 776 -3.3% 1.01x 256 3.1% 769 3.5% 79.2 -1.3% 10.3% 11.3% 2013E 1,031 -7.5% 0.99x 653 -2.0% 1,045 1.9% 53.0 11.1% 5.1% 5.3% 40 -30 -18.2 1,768 -6.4% 0.99x 894 -1.7% 1,783 2.5% 135.1 9.5% 7.6% 114.0 3.8% 6.4% 2014E 2014E 796 2.5% 1.00x 253 -1.4% 799 4.0% 87.9 11.1% 11.0% 12.0% 2014E 1,057 2.5% 0.98x 634 -2.9% 1,076 3.0% 56.0 5.6% 5.2% 0.055 40 -30 -21.6 1,813 2.6% 0.98x 861 -3.6% 1,845 3.5% 146.6 8.5% 7.9% 122.2 7.2% 6.6%

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Financials
Profit and loss account
Year-end December (EUR m) Sales Cost of sales Gross profit Sales and marketing General and administration Research and development Other operating income Other operating expenses Unusual or infrequent items EBITDA Depreciation EBITA Amortisation of goodwill Amortisation of intangible assets Impairment charges EBIT Interest income Interest expenses Other financial result Financial result Income on ordinary activities before taxes Extraordinary income/loss EBT Taxes Net income from continuing operations Income from discontinued operations (net of tax) Net income Minority interest Net income (net of minority interest) Source: Company data, Berenberg Bank estimates 2009 902 743 159 85 78 36 25 39 0 -29 16 -46 0 7 0 -53 10 21 0 -11 -64 0 -64 11 -76 0 -76 0 -76 2010 1,079 875 204 87 76 30 30 24 7 47 15 25 0 7 0 25 9 31 0 -22 -5 0 -5 4 -9 0 -9 0 -9 2011 1,436 1,154 282 100 79 38 43 44 8 99 16 75 0 10 0 73 10 27 -1 -18 46 0 46 16 30 0 30 0 30 2012e 1,739 1,401 338 111 90 40 40 41 7 137 17 107 0 11 0 110 8 20 0 -12 91 0 91 31 59 0 59 0 59 2013e 1,783 1,420 363 116 95 42 47 50 7 142 17 118 0 11 0 114 8 21 0 -13 94 0 94 30 63 0 63 0 63 2014e 1,845 1,468 377 119 98 43 49 51 7 154 18 128 0 13 0 122 6 21 0 -15 100 0 100 30 70 0 70 0 70

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Balance sheet
Year-end December (EUR m) Intangible assets Property, plant and equipment Financial assets Fixed assets Inventories Accounts receivable Other current assets Liquid assets Deferred taxes Other accruals Current assets TOTAL Shareholders' equity Minority interest Long-term debt Pensions provisions Other provisions Deferred taxes Non-current liabilities Short-term debt Accounts payable Advance payments Other liabilities Deferred taxes Other accruals Current liabilities TOTAL Source: Company data, Berenberg Bank estimates 2009 79 90 11 181 104 114 223 61 26 17 546 726 159 1 64 70 127 13 274 46 73 27 126 19 0 291 726 2010 77 86 10 172 158 126 264 203 35 27 812 985 197 1 193 70 102 14 380 71 149 49 120 18 0 407 985 2011 79 88 8 174 195 146 359 169 35 0 904 1,078 251 1 194 70 90 6 361 7 167 67 203 20 0 465 1,078 2012e 93 91 8 192 238 181 345 185 34 0 984 1,176 305 1 194 71 91 8 364 14 203 67 200 20 0 505 1,176 2013e 104 97 8 209 244 195 332 269 33 0 1,074 1,283 355 1 254 72 92 10 428 12 214 55 197 20 0 498 1,283 2014e 109 106 8 223 256 215 319 290 32 0 1,113 1,337 410 1 254 73 93 12 432 11 213 55 195 20 0 494 1,337

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Cash flow statement

EUR m Net profit/loss Depreciation of fixed assets Amortisation of goodwill Amortisation of intangible assets Other Cash flow from operations before changes in w/c Change in inventory Change in accounts receivable Change in accounts payable Change in other working capital positions Change in working capital Cash flow from operating activities Maintenance capex Cash flow from operating activities after maintenance Capex, excluding maintenance Payments for acquisitions Financial investments Income from asset disposals Cash flow from investing activities Cash flow before financing Increase/decrease in debt position Purchase of own shares Capital measures Dividends paid Others Effects of exchange rate changes on cash Cash flow from financing activities Increase/decrease in liquid assets Liquid assets at end of period Source: Company data, Berenberg Bank estimates 2009 -76 16 0 7 13 -39 48 110 -113 0 44 5 19 -14 8 0 1 1 -27 -22 15 0 27 0 0 0 42 20 61 2010 -9 15 0 7 -19 -5 -52 -45 78 0 -19 -25 10 -35 5 0 0 3 -13 -37 134 0 43 0 0 2 177 142 203 2011 30 16 0 10 -13 43 -36 -84 113 0 -7 36 20 17 11 0 0 0 -30 6 -65 0 24 0 0 1 -42 -35 169 2012e 59 17 0 11 10 97 -43 -36 36 0 -42 55 29 26 16 0 0 0 -45 10 7 0 0 0 0 0 7 17 185 2013e 63 17 0 11 10 101 -6 -14 11 -12 -22 79 32 48 14 0 0 0 -45 34 58 0 0 8 0 0 50 100 269 2014e 70 18 0 13 10 111 -12 -19 -1 0 -32 79 32 46 14 0 0 0 -46 33 -1 0 0 10 0 0 -11 42 290

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Ratios
Ratios Asset utilisation efficiency Capital employed turnover Operating assets turnover Plant turnover Inventory turnover (sales/inventory) Operational efficiency Operating return Total operating costs / sales Sales per employee EBITDA per employee EBIT margin Return on capital EBIT/ Y/E capital employed EBIT / avg. capital employed EBITDA/ Y/E capital employed EBITDA / avg. capital employed Return on equity Net profit / Y/E equity Recurring net profit / Y/E equity Net profit / avg. equity Recurring net profit / avg. equity Security Net debt (if net cash=0) Debt / equity Net gearing Equity ratio Interest cover EBITDA / interest paid Book value of equity/book value of debt Altman's z-score Dividend payout ratio Liquidity Current ratio Acid test ratio Free cash flow Funds management Avg. working capital / sales Cash flow / sales Free cash flow/sales Inventory processing period (days) Receivables collection period (days) Payables payment period (days) Cash conversion cycle (days) Trade creditors / trade debtors Other Interest received / avg. cash Interest paid / avg. debt Capex / dep'n Cost per employee Capex / sales Maint. capex / sales Cash flow Cash ROCE Free cash flow yield Source: Company data, Berenberg Bank estimates 2009 1.9 4.3 10.0 8.7 -14.3% 23.5% 0.2 -0.01 -5.8% -10.9% -10.8% -6.1% -6.0% -47.5% -8.7% -40.8% -7.5% 48 68.8% 30.4% 22.0% 0 0 1.5 2.4 0% 1.9 1.5 -22.4 22.9% -3.8% -2.5% 51 46 36 61 64.2% 20.1% 21% 122.5% 0 3.1% 2.1% -34 -6.9% -8.1% 2010 1.7 6.3 12.6 6.8 23.2% 17.3% 0.2 0.01 2.3% 3.8% 4.4% 7.3% 8.3% -4.4% 4.5% -4.8% 5.0% 60 134.1% 30.7% 20.0% 1 2 0.7 1.9 0% 2.0 1.6 -40.2 16.9% 2.4% -3.7% 77 43 72 47 118.2% 6.8% 17% 69.1% 0 1.4% 0.9% 26 4.6% -10.7% 2011 2.3 7.4 16.4 7.3 46.5% 15.2% 0.2 0.01 5.1% 11.7% 13.0% 15.9% 17.6% 11.9% 11.8% 13.3% 13.3% 33 80.3% 13.0% 23.3% 4 4 1.2 2.6 0% 1.9 1.5 6.1 12.4% 3.6% 0.4% 94 37 80 51 114.9% 5.3% 12% 116.1% 0 2.1% 1.4% 51 9.2% 1.1% 2012e 2.5 7.3 19.1 7.3 51.4% 13.9% 0.3 0.02 6.3% 16.0% 16.8% 20.0% 21.0% 19.5% 19.5% 21.4% 21.4% 23 68.2% 7.4% 26.0% 9 7 1.5 3.0 14% 2.0 1.5 9.8 12.0% 4.3% 0.6% 112 38 96 54 112.4% 4.5% 10% 163.6% 0 2.6% 1.7% 76 11.6% 0.9% 2013e 2.2 6.7 18.4 7.3 50.5% 14.4% 0.3 0.02 6.4% 14.3% 15.4% 17.8% 19.2% 17.8% 17.8% 19.2% 19.2% -3 75.0% -0.8% 27.7% 9 7 1.3 2.9 16% 2.2 1.7 34.0 13.5% 4.3% 1.9% 112 40 98 54 109.5% 3.5% 9% 161.0% 0 2.5% 1.8% 77 10.4% 3.0% 2014e 2.2 6.0 17.4 7.2 47.4% 14.2% 0.3 0.02 6.6% 14.3% 14.8% 18.0% 18.6% 17.0% 17.0% 18.2% 18.2% -25 64.8% -6.1% 30.6% 8 7 1.5 3.1 19% 2.3 1.7 32.5 14.5% 4.6% 1.8% 115 43 96 62 99.2% 2.1% 8% 146.1% 0 2.5% 1.8% 85 10.3% 2.9%

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Contacts: Investment Banking

Equity Research
BANKS Nick Anderson James Chappell Andrew Lowe Eleni Papoula BEVERAGES Philip Morrisey Josh Puddle BUSINESS SERVICES William Foggon Simon Mezzanotte Arash Roshan Zamir Konrad Zomer CAPITAL GOODS Frederik Bitter Benjamin Glaeser William Mackie Margaret Paxton Alexander Virgo Felix Wienen CHEMICALS Jade Barkett Asad Farid John Philipp Klein Jaideep Pandya CONSTRUCTION Chris Moore Robert Muir Michael Watts DIVERSIFIED FINANCIALS Pras Jeyanandhan Richard Perrott +44 (0) 20 3207 7838 +44 (0) 20 3207 7844 +44 (0) 20 3465 2743 +44 (0) 20 3465 2741 ECONOMICS Dr. Holger Schmieding Dr. Christian Schulz Robert Wood FOOD MANUFACTURING Fintan Ryan James Targett +44 (0) 20 3207 7889 +44 (0) 20 3207 7878 +44 (0) 20 3207 7822 E-mail: firstname.lastname@berenberg.com; Internet www.berenberg.de MID-CAP GENERAL Gunnar Cohrs Bjoern Lippe Anna Patrice Alexandra Schlegel Stanislaus von Thurn und Taxis REAL ESTATE Kai Klose Estelle Weingrod TECHNOLOGY Adnaan Ahmad Sebastian Grabert Daud Khan Ali Khwaja Tammy Qiu TELECOMMUNICATIONS Wassil El Hebil Usman Ghazi Stuart Gordon Laura Janssens Paul Marsch Barry Zeitoune TOBACCO Erik Bloomquist Kate Kalashnikova UTILITIES Robert Chantry Andrew Fisher Lawson Steele +44 (0) 20 3207 7894 +44 (0) 20 3207 7845 +44 (0) 20 3207 7863 +44 (0) 20 3207 7896 +44 (0) 20 3207 2631

+44 (0) 20 3207 7892 +44 (0) 20 3207 7881

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GENERAL RETAIL & LUXURY GOODS Bassel Choughari +44 (0) 20 3465 2675 John Guy +44 (0) 20 3465 2674 HEALTHCARE Scott Bardo Alistair Campbell Charles Cooper Louise Hinds Adrian Howd Tom Jones

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+44 (0) 20 3207 7851 +44 (0) 20 3207 7834 +44 (0) 20 3465 2638 +44 (0) 20 3207 7852 +44 (0) 20 3465 2673

HOUSEHOLD & PERSONAL CARE Seth Peterson +44 (0) 20 3207 7891 Andrew Steele +44 (0) 20 3207 7926 INSURANCE Tom Carstairs Peter Eliot Matthew Preston Sami Taipalus MEDIA Emma Coulby Laura Janssens Sarah Simon

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Sales
Specialist Sales CONSUMER Rupert Trotter INSURANCE Trevor Moss LONDON Miel Bakker John von Berenberg-Consbruch Ronald Bernette Matt Chawner Toby Flaux Sean Heath David Hogg Ben Hutton James Matthews David Mortlock Peter Nichols George Smibert Max von Doetinchem Paul Walker +44 (0) 20 3207 7815 HEALTHCARE Frazer Hall TECHNOLOGY Jean Beaubois HAMBURG Susette Mantzel Marco Weiss PARIS Christophe Choquart Dalila Farigoule Clmence La Clavire-Peyraud Olivier Thibert ZURICH Stephan Hofer Carsten Kinder Gianni Lavigna Benjamin Stillfried CRM FRANKFURT Michael Brauburger Nina Buechs Andr Grosskurth Boris Koegel Joachim Kopp LONDON Greg Swallow Laura Cooper CORPORATE ACCESS LONDON Patricia Nehring +44 (0) 20 3207 7833 +44 (0) 20 3207 7806 +44 (0) 20 3207 7875 E-mail: firstname.lastname@berenberg.com; Internet www.berenberg.de UTILITIES Benita Barretto +44 (0) 20 3207 7829 INDUSTRIALS Chris Armstrong Kaj Alftan Sales Trading HAMBURG Paul Dontenwill Christian Endras Gregor Labahn Chris McKeand Fin Schaffer Lars Schwartau Marvin Schweden Tim Storm Philipp Wiechmann LONDON Stewart Cook Simon Messman Stephen O'Donohoe PARIS Sylvain Granjoux EVENTS LONDON Natalie Meech Charlotte Kilby Hannah Whitehead

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+49 (0) 40 350 60 694 +49 (0) 40 350 60 719

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US Sales
BERENBERG CAPITAL MARKETS LLC Member FINRA & SIPC Andrew Holder Colin Andrade Cathal Carroll Burr Clark Julie Doherty +1 (617) 292 8222 +1 (617) 292 8230 +1 (646) 445 7206 +1 (617) 292 8282 +1 (617) 292 8228

E-mail: firstname.lastname@berenberg-us.com Kelleigh Faldi Kieran O'Sullivan Emily Mouret Jonathan Saxon +1 (617) 292 8288 +1 (617) 292 8292 +1 (646) 445 7204 +1 (646) 445 7202

KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Please note that the use of this research report is subject to the conditions and restrictions set forth in the General investment-related disclosures and the Legal disclaimer at the end of this document. For analyst certification and remarks regarding foreign investors and country-specific disclosures, please refer to the respective paragraph at the end of this document.

Disclosures in respect of section 34b of the German Securities Trading Act (Wertpapierhandelsgesetz WpHG)
Company KUKA AG (1) (2) (3) (4) (5) (6) Disclosures 1, 2, 3, 5

Berenberg Bank or its affiliate(s) was Lead Manager or Co-Lead Manager over the previous 12 months of a public offering of this company. Berenberg Bank acts as Designated Sponsor for this company. Over the previous 12 months, Berenberg Bank and/or its affiliate(s) has effected an agreement with this company for investment banking services or received compensation or a promise to pay from this company for investment banking services. Berenberg Bank and/or its affiliate(s) holds 5% or more of the share capital of this company. Berenberg Bank holds a trading position in shares of this company. Berenberg Bank and/or its affiliate(s) holds a net short position of 1% or more of the share capital of this company, calculated by methods required by German law as of the last trading day of the past month.

Historical price target and rating changes for KUKA AG in the last 12 months (full coverage) Date 28 March 12 24 April 12 09 May 12 07 August 12 12 September 12 08 January 13 11 March 13 Price target - EUR 18.00 20.00 22.00 25.00 27.50 29.00 32.00 Rating Hold Buy Buy Buy Buy Hold Hold Initiation of coverage 16 September 04

Berenberg distribution of ratings and in proportion to investment banking services Buy Sell Hold 45.25 % 16.77 % 37.98 % 70.37 % 3.70 % 25.93 %

Valuation basis/rating key

The recommendations for companies analysed by Berenberg Banks equity research department are either made on an absolute basis (absolute rating system) or relative to the sector (relative rating system), which is clearly stated in the financial analysis. For both absolute and relative rating system, the three-step rating key Buy, Hold and Sell is applied. For a detailed explanation of our rating system, please refer to our website at http://www.berenberg.de/research.html?&L=1 NB: During periods of high market, sector or stock volatility, or in special situations, the rating system criteria as described on our website may be breached temporarily.

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KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

Competent supervisory authority

Bundesanstalt fr Finanzdienstleistungsaufsicht -BaFin- (Federal Financial Supervisory Authority), Graurheindorfer Strae 108, 53117 Bonn and Lurgiallee 12, 60439 Frankfurt am Main

General investment-related disclosures

Joh. Berenberg, Gossler & Co. KG (Berenberg Bank) has made every effort to carefully research all information contained in this financial analysis. The information on which the financial analysis is based has been obtained from sources which we believe to be reliable such as, for example, Thomson Reuters, Bloomberg and the relevant specialised press as well as the company which is the subject of this financial analysis. Only that part of the research note is made available to the issuer (who is the subject of this analysis) which is necessary to properly reconcile with the facts. Should this result in considerable changes a reference is made in the research note. Opinions expressed in this financial analysis are our current opinions as of the issuing date indicated on this document. The companies analysed by Berenberg Bank are divided into two groups: those under full coverage (regular updates provided); and those under screening coverage (updates provided as and when required at irregular intervals). The functional job title of the person/s responsible for the recommendations contained in this report is Equity Research Analyst unless otherwise stated on the cover. The following internet link provides further remarks on our financial analyses: http://www.berenberg.de/research.html?&L=1&no_cache=1

Legal disclaimer
This document has been prepared by Berenberg Bank. This document does not claim completeness regarding all the information on the stocks, stock markets or developments referred to in it. On no account should the document be regarded as a substitute for the recipient procuring information for himself/herself or exercising his/her own judgements. The document has been produced for information purposes for institutional clients or market professionals. Private customers, into whose possession this document comes, should discuss possible investment decisions with their customer service officer as differing views and opinions may exist with regard to the stocks referred to in this document. This document is not a solicitation or an offer to buy or sell the mentioned stock. The document may include certain descriptions, statements, estimates, and conclusions underlining potential market and company development. These reflect assumptions, which may turn out to be incorrect. Berenberg Bank and/or its employees accept no liability whatsoever for any direct or consequential loss or damages of any kind arising out of the use of this document or any part of its content. Berenberg Bank and/or its employees may hold, buy or sell positions in any securities mentioned in this document, derivatives thereon or related financial products. Berenberg Bank and/or its employees may underwrite issues for any securities mentioned in this document, derivatives thereon or related financial products or seek to perform capital market or underwriting services.

Analyst certification

I, Benjamin Glaeser, hereby certify that all of the views expressed in this report accurately reflect my personal views about any and all of the subject securities or issuers discussed herein. In addition, I hereby certify that no part of my compensation was, is, or will be, directly or indirectly related to the specific recommendations or views expressed in this research report, nor is it tied to any specific investment banking transaction performed by Berenberg Bank or its affiliates.

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KUKA AG
Small/Mid-Cap: Capital Goods & Industrial Engineering

I, Felix Wienen, hereby certify that all of the views expressed in this report accurately reflect my personal views about any and all of the subject securities or issuers discussed herein. In addition, I hereby certify that no part of my compensation was, is, or will be, directly or indirectly related to the specific recommendations or views expressed in this research report, nor is it tied to any specific investment banking transaction performed by Berenberg Bank or its affiliates.

Remarks regarding foreign investors

The preparation of this document is subject to regulation by German law. The distribution of this document in other jurisdictions may be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions.

United Kingdom
This document is meant exclusively for institutional investors and market professionals, but not for private customers. It is not for distribution to or the use of private investors or private customers.

United States of America

This document has been prepared exclusively by Berenberg Bank. Although Berenberg Capital Markets LLC, an affiliate of Berenberg Bank and registered US broker-dealer, distributes this document to certain customers, Berenberg Capital Markets LLC does not provide input into its contents, nor does this document constitute research of Berenberg Capital Markets LLC. In addition, this document is meant exclusively for institutional investors and market professionals, but not for private customers. It is not for distribution to or the use of private investors or private customers. This document is classified as objective for the purposes of FINRA rules. Please contact Berenberg Capital Markets LLC (+1 617.292.8200), if you require additional information.

Third-party research disclosures Company

KUKA AG (1) (2) (3) (4) (5)

Disclosures
no disclosures

Berenberg Capital Markets LLC owned 1% or more of the outstanding shares of any class of the subject company by the end of the prior month.* Over the previous 12 months, Berenberg Capital Markets LLC has managed or co-managed any public offering for the subject company.* Berenberg Capital Markets LLC is making a market in the subject securities at the time of the report. Berenberg Capital Markets LLC received compensation for investment banking services in the past 12 months, or expects to receive such compensation in the next 3 months.* There is another potential conflict of interest of the analyst or Berenberg Capital Markets LLC, of which the analyst knows or has reason to know at the time of publication of this research report.

* For disclosures regarding affiliates of Berenberg Capital Markets LLC please refer to the Disclosures in respect of section 34b of the German Securities Trading Act (Wertpapierhandelsgesetz WpHG) section above.

Copyright

Berenberg Bank reserves all the rights in this document. No part of the document or its content may be rewritten, copied, photocopied or duplicated in any form by any means or redistributed without Berenberg Banks prior written consent. June 2012 Berenberg Bank

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