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Investor Presentaiton

Reconciliation Between Adjusted and Reported GAAP Financials For the Twelve Months Ended December 31, 2020 As Reported, For the Twelve Months Ended December 31, 2019 As Reported, In thousands except per share data Lydall, Inc Adjustments Adjusted Results Lydall, Inc Adjustments Adjusted Results Net sales Cost of sales Gross profit $ 764,041 $ 764,041 $ 837,398 $ 837,398 619,166 (229) (a) 618,937 684,978 144,875 229 145,104 152,420 (987) (g) 987 683,991 153,407 Gross margin 19.0% 19.0% 18.2 % 18.3% Selling, product development and administrative expenses 129,928 (3,429) (b) 126,499 126,272 (4,671) (h) 121,601 Impairment of goodwill and other long-lived assets 61,109 (61,109) (c) 64,206 (64,206) (i) Restructuring expenses 15,903 (15,903) (d) 767 (767) (j) Operating (loss) income (62,065) 80,670 18,605 (38,825) 70,631 31,806 Operating margin (8.1)% 2.4% (4.6)% 3.8% Employee benefit plans settlement expenses 385 (385) (e) 25,247 (25,247) (k) Interest expense 15,979 15,979 14,262 14,262 Other expense (income), net 2,166 2,166 (1,257) 1,459 (1) 202 (Loss) income before income taxes (80,595) 81,055 460 (77,077) 94,419 17,342 Income tax (benefit) expense (6,833) 7,608 (f) 775 (6,416) 11,451 (m) 5,035 Income from equity method investment (37) (37) (148) (148) Net (loss) income (Loss) earnings per share: Basic Diluted (73,725) 73,447 (278) (70,513) 82,968 12,455 S9 S (4.24) (0.02) (4.24) (0.02) SS $ (4.08) (4.08) S9S9 0.72 0.72 Weighted average number of common shares outstanding: Basic Diluted 17,379 17,379 17,379 17,379 (a) Exclude the reduction-in-force severance expenses of $0.1 million related to the Thermal Acoustical Solutions segment. 17,271 17,271 (b) Exclude the corporate strategic initiatives expenses of $3.1 million and reduction-in-force severance expenses of $0.3 million related to the Thermal Acoustical Solutions segment. (c) Exclude the impairment of goodwill and other long-lived assets expense of $61.1 million related to the Performance Materials segment. (d) Exclude the restructuring expenses of $15.9 million, primarily related to the Performance Materials segment. (e) Exclude the employee benefit plan settlement expenses of $0.4 million. (f) Excludes the tax benefits and expenses realized on the adjustments in (a), (b), (c), (d), and (e) of $7.6 million. (g) Exclude the reduction-in-force severance expenses of $1.0 million across all segments. 17,271 17,326 (h) Exclude the CEO transition expenses of $2.3 million, corporate strategic initiatives expenses of $1.5 million, and reduction-in-force severance expenses of $1.0 million across all segments. (i) Exclude the impairment of goodwill and other long-lived assets expense of $64.2 million related to the Performance Materials segment. (j) Exclude the restructuring expenses of $0.8 million related to the Technical Nonwovens segment. (k) Exclude the employee benefit plans settlement expense of $25.2 million. (I) Exclude the gain on sale from divestiture of $1.5 million. (m) Exclude the tax benefits and expenses realized on the adjustments in (g), (h), (i), (j), (k), and (I) of $11.5 million. USE OR DISCLOSURE OF INFORMATION CONTAINED ON THIS SHEET IS SUBJECT TO THE RESTRICTIONS ON THE TITLE SLIDE Lydall 23
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