Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Q1 2015 Earnings Presentation
42 slides from Be Semiconductor Industries's earnings presentation, May 2015
Slide 1: Investor Presentation May 2015
INVESTOR PRESENTATION MAY 2015
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements about management's future expectations, plans and prospects of our business that constitute forward-looking statements, which are found in various places throughout the press release, including , but not limited to, statements relating to e
Slide 3: Agenda
Agenda I. Company Overview II. Market III. Strategy IV. Financial Review V. Outlook & Summary May 2015 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW May 2015 4
Slide 5: Besi Overview
Besi Overview • Leading assembly equipment supplier with #1 and #2 positions in key products. 32% addressable market share • Broad portfolio: die attach, packaging and plating Corporate Profile • Strategic positioning in substrate and wafer level packaging • Global mfg. operations in 7 countries; 1,
Slide 6: Company History
Company History 55% € 403.7 Die Attach Acquisitions 400 50% • 2000 2002 2005 2009 45.3% 45% 300 Restructuring Revenue (€ millions) Gross Margin (%) • 2006 Dragon I complete: € 6 million cost savings • 2008 Dragon II complete: € 15 million cost savings 40% • 2010 Plan: € 7.0 million cost savings. Hea
Slide 7: Product Positioning
Product Positioning Back-end Semiconductor Assembly Process Dicing Die Attach Wire Bond Packaging Plating Die Sort Die Bond Wire Bond Molding Trim & Form Plating Leadframe Assembly Singulation Substrate Ball Grid Array Wire Bond Assembly Die Sort FC Die Bond Molding Singulation Ball Grid Array Subst
Slide 8: Best in Class Product Portfolio
Best in Class Product Portfolio Die Attach Packaging & Plating In Development • Die Bonding • Molding - 2100 xPplus - AMS series • Next generation Die Attach - 2100 sDplus - AMS LM 95 - 2100 sD PPPplus - MMS series • Next generation Packaging - 2100 HS New - FML New • Common modules Esec - 2009 SSI
Slide 9: Customer Ecosystem
Customer Ecosystem Customers OEMs End Products IDMs Subcontractors • Blue chip customer base, top 10 = 60% of 2014 revenue • Leading IDMs and subcontractors. 60/40% split in 2014 • Equipment utilized to produce chips for leading fabless companies: Qualcomm, Broadcom, MediaTek • Long term relationshi
Slide 10: Global Operations
Global Operations Duiven & Drunen, (The Netherlands)* Cham, Radfeld, (Austria)* (Switzerland)* Chandler Suzhou Chengdu Korea Shanghai Leshan Sales Office Taiwan Shenzhen Production Site Malaysia Philippines Sales & Production Site Singapore* * R&D Site as of 31 March 2015 • Development activities in
Slide 11: Summary Historical Financials
Summary Historical Financials • Record 2014 Results: Year Ended December 31, • Revenue and orders +48.6% and 61.8% (€ millions, except share data) 2012 2013 2014 • Gross Margin +4.0% to 43.8% • Net Income +341% to € 71.1 million • Net cash +€ 47.0 million Revenue 273.7 254.9 378.8 Orders 276.1 251.9
Slide 12: Dividend Trends
Dividend Trends Dividend EPS (diluted) Total Dividend Yield (a) 2.00 12.0% 1.87 1.80 10.0% 1.60 1.50 1.40 8.1% 1.25 8.0% 1.20 Dividend yield Dividend (€) 1.00 5.2% 6.0% 0.80 0.73 4.0% 4.0% 4.3% 4.0% 0.60 0.42 0.43 0.40 0.30 0.33 0.22 2.0% 0.20 0.20 Payout Ratio: 16% 30% 71% 77% 80% 0.00 0.0% 2010 20
Slide 13: II. Market
II. MARKET May 2015 13
Slide 14: Assembly Equipment Market Trends
Assembly Equipment Market Trends Assembly Equipment Market Size YoY Growth Rate 5.0 30% 24.3% 4.0 20% 4.3 (US$ billions) 3.9 3.7 3.9 10% 3.0 3.4% 3.0 0% 2.0 -9.6% -10% 1.0 -20% -23.1% - -30% 2011 2012 2013 2014E 2015F Source: VLSI January 2015 Besi Revenue Revenue YoY Growth Rate 400.0 150% 378.8 30
Slide 15: Assembly Equipment Market Composition
Assembly Equipment Market Composition Assembly Equipment Market * Besi Addressable Market * (2014: $3.7 billion) (2014: $1.6 billion) Lead Trim & Plating Other Form 1.3% Assembly 6.3% (Inspection, Wire Bonding 22.3% Molds Dicing) 16.1% 28.1% Die Bonding 38.4% Presses 8.9% Die Attach Plating 59% 0.6%
Slide 16: Advanced Packaging Unit Volume and Market Share Are Increasing
Advanced Packaging Unit Volume and Market Share Are Increasing Advanced Packaging Silicon Demand Growth & Market Share 2010 - 2019 45 Advanced Packaging Wafers 38% 40% 37% Advanced Packaging Unit Market Share (%) 35% 40 34% 32% 35% CAGR 2010-2019: 21.1% 31% 35 30% M wafers, 300MM Eq. 26% AP Market S
Slide 17: Advanced Packaging Growth Favors Besi
Advanced Packaging Growth Favors Besi Greater Miniaturization High Growth End Greater Higher Accuracy Complexity User Areas: Datacon Esec Fico Die Attach • Die Sorting: DS 9000 Mobile internet • Die Bonding: ES 2009, ES2100 • Flip Chip: DC 8800, ES2100 devices, Autos, • TCB: DC 8800 TCB • Multi Modu
Slide 18: Reflected in Besi End User Application Trends
And Is Reflected in Besi End User Application Trends 2014 Spares/ Service Computer, 15% PCs LED 20% 3% • Mobile internet devices Industrial now equal 35% of 2008 10% Besi’s end user Service revenue 2% LED Industrial 3% Mobile 10% Auto Internet Devices • Automotive has also 17% 35% increased signific
Slide 19: Driven Primarily by Growth in Internet Connected Devices
Driven Primarily by Growth in Internet Connected Devices • 35% CAGR device growth forecast over next 5 years • Powered by devices used for Internet of Things (IoT) • Positive trajectory for smart phone, tables, wearables, and automotive • Significant potential revenue growth driver May 2015 19
Slide 20: New Smart Phone Designs Increase Addressable Market Potential
New Smart Phone Designs Increase Addressable Market Potential Generation Generation Main Components Manufacturer IDM/OSAT Besi system Utilized - New 2012 2014 Processor X X Apple TSMC ->Amkor/Stats/ASE 8800FCQ, AMS-W/LM DRAM Memory X X Hynix/Micron Hynix/Micron 2100sD, FSL NAND Flash X X Hynix/Toshi
Slide 21: Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity
Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity 2014* 2019* Wire Bonding Flip Chip Bonding Flip Chip Flip Chip $311 $428 27% 32% Wire Wire Bonding Bonding $929 $833 68% 73% Flip Chip Advantages Reduces board area Offers higher speed CAGR 2014 – 19* by up to 95%. electrical Flip Chip
Slide 22: Besi Has Gained Market Share In Its Addressable Markets
Besi Has Gained Market Share In Its Addressable Markets Besi Market Share Source: VLSI, Jan 2015 and Besi estimates 2012 2013 2014 Total Assembly Equipment Sales 8.6% 10.8% 13.4% Besi Addressable Market 21.8% 27.0% 31.7% Total Die Attach Equipment 27.7% 33.1% 38.7% Die Bonding 29.7% 39.6% 44.0% Flip
Slide 23: And With Leading Edge Technology Customers
And With Leading Edge Technology Customers Die Attach Packaging In USD 2012 2013 2014 2012 2013 2014 Subcontractors • Customers are largest producers. ASE 67% 59% 69% 36% 65% 24% • Engaged in most advanced Amkor 75% 84% 89% 45% 11% 22% packaging applications STATSChippac 95% 100% 85% 28% 100% 100% S
Slide 24: III. Strategy
III. STRATEGY May 2015 24
Slide 25: Summary Strategy
Summary Strategy Develop new products and markets • Continue enhancing best in class <20 nano assembly equipment portfolio • Expand tech capabilities and applications for TCB line • IoT and wearables have potential to significantly expand addressable market Increase market share in addressable marke
Slide 26: Operations Agenda
Operations Agenda 2015 2016 Operational Objectives Expansion of Asian supply chain. System module outsourcing Transfer of certain die bonding production from Malaysia to China Transfer of certain Swiss Die Attach software, logistics and administrative functions to Singapore Development Objectives Ad
Slide 27: Asian Production Has Significantly Expanded
Asian Production Has Significantly Expanded Total Asian Shipments Direct Asian Shipments % Direct 1,200 96.3% 100.0% 84.0% 86.0% 90.0% 1,000 963 927 80.0% 68.0% % Direct Shipments 70.0% 800 60.0% Shipments 42.9% 600 658 673 50.0% 579 553 40.0% 487 400 396 30.0% 331 20.0% 200 170 10.0% - 0.0% 2010 20
Slide 28: Leading to Lower European Headcount
Leading to Lower European Headcount Europe/NA Fixed HC Asia Fixed HC Total 1,800 1,600 1,543 1,510 1,530 1,479 1,434 1,400 1,200 • Fixed European/North American 802 52% 799 908 933 headcount reduction: Headcount 1,000 54% 810 56% 60% 61% • Down 19.4% since 2011 • Declined from 56% of total in 2009 t
Slide 29: And Also Reduced Break Even Revenue Levels
And Also Reduced Break Even Revenue Levels 300 (13.0%) 270 250 235 (9.8%) (2.4%) 200 212 207 (€ millions) 150 100 50 - 2011 2012 2013 2014 May 2015 29
Slide 30: Workforce Has Become More Scalable and Flexible
Workforce Has Become More Scalable and Flexible 2,500 12.0% 10.0% 2,000 1,680 1,607 1,632 1,539 8.0% 64 1,458 122 150 • 2014 revenue ramp achieved Temp % of Total 1,500 60 24 using primarily Asian Headcount production temps 6.0% 802 799 1,000 810 908 933 • Aggregate headcount varies with cyclicality
Slide 31: Materials Cost Reduction Is Also a Key Priority
Materials Cost Reduction Is Also a Key Priority Supply Chain Actions • Qualify and Select Asian Vendors • 50% of the way there +5% Gross Margin Upside Development Actions • Redesign products • Increase standardization of systems • Component parts • Modules • Material costs represent approximately 45
Slide 32: Partially Achieved Through Common Parts Product Redesign
Partially Achieved Through Common Parts Product Redesign Potential Unit Cost Savings DB2100 (7%) • Magazine handler • Wafer gripper 2200evo (11%) • Dispenser Areas of focus: • Wafer table • Wafer Cassette Handler • Die Ejector 8800FCQ (11%) • Control Platform Average (9%) • Development efforts under
Slide 33: IV. Financial Review
IV. FINANCIAL REVIEW May 2015 33
Slide 34: Revenue Growth and Margin Expansion Yield Increased Profitability
Revenue Growth and Margin Expansion Yield Increased Profitability Q1-15/Q1-14 FY 2014/FY 2013 Revenue Net Income Revenue Net Income 95% 400 € 95% 90% € 378.8 90% € 94.9 € 100 85% +48.6% 85% 350 € +35.6% 80% 80% 75% 75% € 70.0 70% 300 € 70% € 254.9 € 75 Gross Margin 65% Gross Margin 65% 42.3% +6.7 po
Slide 35: Quarterly Book to Bill Trends Reflect Seasonality and Volatility
Quarterly Book to Bill Trends Reflect Quarterly Seasonality and Volatility 1.75 1.50 Assembly Market 1.34 1.26 1.25 1.10 0.97 1.01 1.10 1.00 0.94 0.95 0.81 0.75 Total Semi Equipment 0.71 0.68 0.69 0.50 Sept Sept Sept Sept Mar 11 Jun 11 Dec 11 Mar 12 Jun 12 Dec 12 Mar 13 Jun 13 Dec 13 Mar 14 Jun 14 D
Slide 36: Revenue/Order/Gross Margin Trends
Revenue/Order/Gross Margin Trends Revenue Orders Gross Margin Adjusted Gross Margin • Cyclical quarterly revenue/order 140 60.0% patterns: 124 • Three cycles past 3 years 116 120 • Short term patterns due to customer 111 caution and increased seasonality 104 55.0% 104.2 • 2014 year end shows higher
Slide 37: Net Income Trends
Net Income Trends Net Income ex. NR Non Recurring Net Margin 24 22.9 21.5 35% 21 19.7 17.5 18 25% • Quarterly net income trends reflect industry 22.2% 3.3 and seasonal volatility 20.8% 19.7% 15 18.5% 7.5 • Profit increase aided by revenue growth, 15% through cycle gross margin expansion and (euro in
Slide 38: Liquidity Trends
Liquidity Trends Cash Debt Net Cash 180 161.6 160 140 135.3 • Solid liquidity position 133.1 • € 161.9 million cash at 3/31/15 • € 4.29 per share vs. € 29.87 price (as of 120 118.0 March 31, 2015) 105.4 • Net cash reached € 133.1 million at year (euro in millions) 100 91.9 end of Q1 2015 89.6 81.1 8
Slide 39: V. Outlook & Summary
V. OUTLOOK & SUMMARY May 2015 39
Slide 40: 2015 Industry Outlook
2015 Industry Outlook Market Environment Remains Positive Although Mixed Picture by Supplier and Application VLSI sees assembly system growth in 2015 driven by advanced packaging apps Strength in smart Die bonding and flip Companies with New tech/device phones, chip are positive. thin package buys a
Slide 41: Q2-15 Guidance
Q2-15 Guidance Revenue Gross Margin* Operating Expenses* € 94.9 48.2% € 28.3 Up 48% Up - 10-15% 5-7% 46% Q1 Q2 Q1 Q2 Q1 Q2 *excluding restructuring benefit • Underlying business growth continues • Revenue up approximately 10-15% vs. Q1-15 • Gross margins of 46-48% • Opex up 5-7% vs. Q1-15 due primar
Slide 42: Summary
Summary Leading semi assembly Scalability and profitability Strong 2014 growth. equipment supplier with #1 of business model greatly Gaining market share in or #2 positions in fastest enhanced in cyclical advanced packaging. growing assembly industry Positive outlook for 2015 segments Significant up
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