Siltronic Ag · XETR:WAF

Siltronic — Q3 2020 Earnings Presentation

34 slides from Siltronic's earnings presentation, Oct 29, 2020

Slide 2: Increasing demand for electronic devices drives semiconductor growth and silicon demand
Increasing demand for electronic devices and new applications drive semiconductor growth, which in turn fuels silicon demand Electronics value chain 2019 Electronics USD 1,680 bn Semiconductors USD 400 bn Semiconductor silicon wafers USD 11.2 bn Silicon for electronic applications USD 1.1 bn Source:
Slide 3: Siltronic has a relevant global market share…
Siltronic has a relevant global market share… Top 5 wafer producers serve more than 90% of market across all diameters 17% 12% 13% 25% 33% SK Siltron Siltronic Shin Etsu Sumco GlobalWafers Sources: reported company revenues Q1 2020, converted to USD million Siltronic AG – Investor Presentation Q3 20
Slide 4: ... and an international manufacturing network
... and an international manufacturing network Freiberg CP* 300 mm Germany Portland 200 mm United States Burghausen CP* 300 mm SD* ► Central R&D hub in Burghausen ► High volume facilities for 300 mm in Germany and Singapore ► Among world’s newest & largest SSW CP* 300 mm SSP 200 mm fabs in Singapore
Slide 5: Siltronic is focused on growing 300 mm and attractive 200 mm business
Siltronic is focused on growing 300 mm and attractive 200 mm business. Development of Total Wafer Demand per Diameter, in mn 300 mm equivalents per month Strong 7 demand 300 mm 200 mm SD (pol/epi) & 6 growth 5 4 3 Stable & attractive 2 1 Mid-term decline 0 2010 2011 2012 2013 2014 2015 2016 2017 201
Slide 6: Cost-competitiveness a pre-requisite
Cost-competitiveness a pre-requisite Major cost items Cost development 2020  Productivity improvement  Labour  Supply savings  Recycling  Energy efficiency  Supplies COLA (cost of living  Lower success adjustment) sharing  Automation  Depreciation Freight Costs  Polysilicon  Energy Unit c
Slide 7: Overview Financials
Overview Financials Adjusted financial figures Q1-Q3 (EUR million) 2016 2017 2018 2019 2020 Sales 933.4 1,177.3 1,456.7 1,270.4 922.5 EBIT 27.0 235.7 497.7 298.3 163.8 EBIT margin in % 2.9 20.0 34.2 23.5 17.8 EBITDA 146.0 353.1 589.3 408.7 264.8 EBITDA margin in % 15.6 30.0 40.5 32.2 28.7 Earnings p
Slide 8: Creating value for all stakeholders
Creating value for all stakeholders ... its customers and suppliers … its shareholders  Quality & Innovation  Long-term value enhancement  Technology leadership  Attractive return  Customer service  On-going cost reduction Siltronic offers … its employees ... the environment and society  Occu
Slide 9: Clear commitment to sustainability
Clear commitment to sustainability Sustainability at Siltronic AG  Claim: We understand sustainability not only as responsible action, but also want to generate competitive advantages through our sustainable actions.  Strategy: We plan resource-saving right from the start, based on product and pro
Slide 10: Environment - Efficiency as a success factor
Environment - Efficiency as a success factor Selection of non-financial performance indicators in 2019 Raw Material Energy Energy efficiency Silicon yield savings (GWh) improved by 4% 4.5 vs. 2018 in 2019 Waste Recycling Occupational Safety Waste Recycling Ratio Working accidents with lost days per
Slide 11: CSR targets until 2030
CSR targets until 2030 Consistently sustainable action secures long-term competitive advantages for Siltronic Reduce specific greenhouse gas emissions by 20%1 Reduce specific energy consumption by 20%1 Reduce specific water consumption by 20%1 Increase water recycling by 25%1 Increase waste recyclin
Slide 12: Investor structure well diversified with a strong anchor shareholder
Investor structure well diversified with a strong anchor shareholder Identified free float by region (as of August 2020) 42.2 % 24% 30% 69.2 % 11% 35% 100 % USA UK Germany Other 57.8 % Significant notifications of voting rights (as of October 27, 2020) 30.8 % Allianz Global Investors 5.13% State of
Slide 13: Siltronic strategy - capitalize on market opportunities while focusing on 300 mm
Siltronic strategy - capitalize on market opportunities while focusing on 300 mm & technological leadership Optimize returns, stay ahead in technology and grow with the market Strategic Focus Grow Ensure Improve Execute with the market technology & financial performance cost reduction quality leader
Slide 15: Q3 sales down due to FX and product mix
Q3 sales down due to FX and product mix Sales, in EUR m Ø FX rates Q3/19 Q4 Q1/20 Q2 Q3 EUR / USD 1.11 1.11 1.10 1.10 1.17 EUR / JPY 119 120 120 118 124 Comments  Wafer area up q-o-q and y-o-y  Flattish price trend q-o-q 323.1 299.8 304.3 300.1 299.2  Strong headwind from:  EUR strength (negativ
Slide 16: Positive cost trend per wafer area despite higher depreciation
Positive cost trend per wafer area despite higher depreciation Cost of sales, in EUR m Gross profit, in EUR m / Gross margin, in % 34.6 31.8 29.8 30.7 26.1 196.1 207.4 210.8 224.0 221.0 103.7 96.9 89.3 99.1 78.2 Q3 2019 Q4 Q1 2020 Q2 Q3 Q3 2019 Q4 Q1 2020 Q2 Q3 Selling, R&D and admin expenses, in EU
Slide 17: High US-Dollar and Japanese Yen exposure
High US-Dollar and Japanese Yen exposure FX exposure, in % FX sensitivity ~ 10% Sales EBITDA unhedged ~ 25% 1 USD-cent change ~ EUR 6 million ~ EUR 4.5 million ~ 65% ~ 65% 1 JPY change ~ EUR 2.5 million ~ EUR 2 million Sales Costs USD SGD JPY EUR Other currency effects (mostly hedging), Comment in E
Slide 18: Strong Euro and change in product mix negative for earnings
Strong Euro and change in product mix negative for earnings EBITDA, in EUR m / EBITDA margin, in % Depreciation, in EUR m 30.5 29.6 31.1 28.1 26.8 91.5 90.0 84.2 100.4 80.1 -27.9 -33.3 -30.9 -33.5 -36.5 Q3 2019 Q4 Q1 2020 Q2 Q3 Q3 2019 Q4 Q1 2020 Q2 Q3 EBIT, in EUR m / EBIT margin, in % Comments  S
Slide 19: Net profit of EUR 39 million
Net profit of EUR 39 million Net profit, in EUR m EPS, in EUR 59.5 60.8 1.65 1.80 45.4 46.0 39.1 1.21 1.32 1.08 Q3 2019 Q4 Q1 2020 Q2 Q3 Q3 2019 Q4 Q1 2020 Q2 Q3 Dividend payment, in EUR m Comments  Net profit of EUR 39m in Q3  Q3 tax rate of 9%  Q1-Q3 tax rate down from 12% to 8% y-o-y 150 75 90
Slide 20: Working capital significantly up due to higher trade receivables and lower trade liabilities
Working capital significantly up due to higher trade receivables and lower trade liabilities Working capital, in EUR m Inventories and contract assets, in EUR m Working capital ratio to quarterly sales, in % Inventories Contract assets 73 80 69 60 58 55 60 40 19.2 14.6 14.6 14.2 15.2 207.0 188.6 218
Slide 21: Equity decreased due to dividend payment and higher pension obligations
Equity decreased due to dividend payment and higher interest- related pension obligations Equity, in EUR m Provisions for pensions, Net financial assets, Equity ratio, in % in EUR m in EUR m 52.8 47.8 45.4 43.7 42.4 Interest rates IFRS 2.99% 2.98% 2.88% 2.46% 2.41% USA Germany 0.97% 1,24% 1.92% 1.23
Slide 22: Pension reserves up due to lowest IFRS interest rate in Germany
Pension reserves up due to lowest IFRS interest rate in Germany in Siltronic history DBO and pension reserves, in EUR m Comment  DBO of EUR 1,256m ./. assets of EUR 650m = EUR 606m 1,256 ~870 650  Pension reserves @3% = DBO of EUR ~870m ./. assets EUR 650m = USA mostly EUR~220m funded 146 2.41% 13
Slide 23: Capex 2020 significantly down vs. 2019
Capex 2020 significantly down vs. 2019 Investment, in EUR m Comment  Q1 included some roll-over from 2019 projects  Planned capability and capacity expansion projects should be mostly completed by year- end  Epi expansion in H2 to accommodate demand and market growth 96.4 88.6 46.0 48.3 35.1 Q3 2
Slide 24: Net cash flow clearly positive
Net cash flow clearly positive Operating cash flow (OCF), in EUR m Customer prepayments net (PP), in EUR m 100.7 74.4 85.6 58.6 60.9 3.6 -15.5 -21.6 -16.9 -10.5 Q3 2019 Q4 Q1 2020 Q2 Q3 Q3 2019 Q4 Q1 2020 Q2 Q3 CF Capex, in EUR m Net cash flow (NCF), in EUR m 8.9 40.9 26.7 28.6 -66.3 -48.8 -42.8 -8.
Slide 26: Siltronic Outlook 2020 (as of July 21, 2020) - unchanged
Siltronic Outlook 2020 (as of July 21, 2020) - unchanged Sales − mid-single digit %-range below 2019 with a slight sequential decrease in H2 vs. H1 EBITDA margin − mid-single digit percentage points below 2019 Depreciation − around EUR 140m EBIT − significantly below 2019 due to higher depreciation
Slide 27: Positive development of wafer volume in Q4 2020
Positive development of wafer volume in Q4 2020 − Strong foundry and logic business 300 mm − Uncertainty due to US-China trade tensions might lead to elevated inventories − Digestion of server components − High exposure to automotive and industry where end markets are 200 mm mixed − Assume some inve
Slide 28: What to expect in the short-term and medium-term
What to expect in the short-term and medium-term Short-term development  Foundry and logic business to stay strong  In memory, server-related inventories seem to be in a digestion phase  Smartphones should see a recovery driven by 5G  Server market seems to be softening  Demand from automotive
Slide 30: Production process - ingot growing
Production process - ingot growing Siltronic AG – Investor Presentation Q3 2020 October 29, 2020 30 of 34
Slide 31: Production process - wafering
Production process - wafering Siltronic AG – Investor Presentation Q3 2020 October 29, 2020 31 of 34
Slide 32: Contact and Additional Information
Contact and Additional Information Issuer and Contact Additional Information Siltronic AG ISIN: DE000WAF3001 Hanns-Seidel-Platz 4 WKN: WAF300 D-81737 München Deutsche Börse: WAF Listing: Frankfurt Stock Exchange Investor Relations: Prime Standard Petra Mueller email: [email protected] Tel.
Slide 33: Disclaimer
Disclaimer The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements contained in this presentation may be statements of future expectations, future financial performance and other forward-looking statements

Siltronic — Q3 2020 Earnings Presentation on 6ix

Siltronic — Q3 2020 Earnings Presentation

Slide 1: Investor Presentation – Q3 2020

Slide 2: Increasing demand for electronic devices drives semiconductor growth and silicon demand

Slide 3: Siltronic has a relevant global market share…

Slide 4: ... and an international manufacturing network

Slide 5: Siltronic is focused on growing 300 mm and attractive 200 mm business

Slide 6: Cost-competitiveness a pre-requisite

Slide 7: Overview Financials

Slide 8: Creating value for all stakeholders

Slide 9: Clear commitment to sustainability

Slide 10: Environment - Efficiency as a success factor

Slide 11: CSR targets until 2030

Slide 12: Investor structure well diversified with a strong anchor shareholder

Slide 13: Siltronic strategy - capitalize on market opportunities while focusing on 300 mm

Slide 14: Financials Q3 2020

Slide 15: Q3 sales down due to FX and product mix

Slide 16: Positive cost trend per wafer area despite higher depreciation

Slide 17: High US-Dollar and Japanese Yen exposure

Slide 18: Strong Euro and change in product mix negative for earnings

Slide 19: Net profit of EUR 39 million

Slide 20: Working capital significantly up due to higher trade receivables and lower trade liabilities

Slide 21: Equity decreased due to dividend payment and higher pension obligations

Slide 22: Pension reserves up due to lowest IFRS interest rate in Germany

Slide 23: Capex 2020 significantly down vs. 2019

Slide 24: Net cash flow clearly positive

Slide 25: Outlook

Slide 26: Siltronic Outlook 2020 (as of July 21, 2020) - unchanged

Slide 27: Positive development of wafer volume in Q4 2020

Slide 28: What to expect in the short-term and medium-term

Slide 29: Appendix

Slide 30: Production process - ingot growing

Slide 31: Production process - wafering

Slide 32: Contact and Additional Information

Slide 33: Disclaimer

Slide 34: Siltronic AG