Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Q4 2014 Earnings Presentation
41 slides from Be Semiconductor Industries's earnings presentation, February 2015
Slide 1: Investor Presentation February 2015
INVESTOR PRESENTATION FEBRUARY 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 February 2015 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW February 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 400 € 378.8 45% Die Attach Acquisitions 43.8% 40% 300 • 2000 2002 2005 2009 Restructuring Revenue (€ millions) Gross Margin (%) • 2006 Dragon I complete: € 6 million cost savings 35% • 2008 Dragon II complete: € 15 million cost savings • 2010 Plan: € 7.0 million cost savings. Headcou
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 customers represented 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 • L
Slide 10: Global Operations
Global Operations Duiven & Drunen, (The Netherlands)* Cham, Radfeld, (Austria)* (Switzerland)* Salem* Chandler Suzhou Chengdu Korea Shanghai Leshan Sales Office Taiwan Shenzhen Production Site Malaysia Philippines Sales & Production Site Singapore* * R&D Site as of 31 December 2014 • Development act
Slide 11: Summary Historical Financials
Summary Historical Financials • Strategic positioning in advanced packaging has yielded benefits: Year Ended December 31, (€ millions, except share data) 2012 2013 2014 • Enhanced top line and market share • Increased gross margins Revenue 273.7 254.9 378.8 • Operating initiatives have supported gro
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% Dividend yield 1.20 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
BeSi asm Il. MARKET February 2015
Slide 14: Assembly Equipment Market Trends
Assembly Equipment Market Trends Assembly Equipment Market Size YoY Growth Rate 5.0 150% 4.3 3.9 4.0 124.0% 3.9 3.0 3.7 100% 4.7 (US$ billions) 3.0 50% 2.0 24.3% 0% 1.0 3.4% -7.7% -9.6% -23.1% - -50% 2010 2011 2012 2013 2014E 2015F Besi Revenue Revenue YoY Growth Rate 450.0 150% 137.4% 378.8 326.9 3
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 • Multi Module:
Slide 18: And Is 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% Internet Auto 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 February 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 2013* 2019* Wire Bonding Flip Chip Bonding Flip Chip Flip Chip $250 $428 26% Wire 32% Bonding Wire $929 Bonding 68% $695 74% Flip Chip Advantages Reduces board area Offers higher speed CAGR 2013 – 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 February 2015 24
Slide 25: Operations Agenda
Operations Agenda 2015 2016 Operational Objectives Expansion of Asian supply chain. System module outsourcing Transfer of certain Swiss Die Attach software, logistics and administrative functions to Singapore Development Objectives Advanced TCB die bonding development Introduction of next generation
Slide 26: 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% 1,000 927 963 80.0% % Direct Shipments 68.0% 70.0% 800 Shipments 60.0% 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 27: Leading to Lower European Headcount
Leading to Lower European Headcount Europe/NA Fixed HC Asia Fixed HC Total 1,800 1,600 1,510 1,543 1,510 1,479 1,434 1,400 1,200 • Fixed European/North American 772 802 799 headcount reduction: Headcount 51% 52% 54% 810 908 1,000 60% • Down 18.8% since 2011 56% • Down 3.5% since 2013 800 • Declined
Slide 28: 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 February 2015 28
Slide 29: Workforce Has Become More Scalable and Flexible
Workforce Has Become More Scalable and Flexible 2,500 12.0% 10.0% 2,000 1,704 1,607 1,632 1,539 8.0% 194 64 1,458 122 • 2014 revenue ramp achieved Temp % of Total 1,500 60 24 using primarily Asian Headcount production temps 6.0% 772 802 799 1,000 810 908 • Aggregate Headcount varies with cyclicality
Slide 30: 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 31: 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 32: IV. Financial Review
IV. FINANCIAL REVIEW February 2015 32
Slide 33: Revenue Growth and Operating Leverage Yield Increased Profitability in 2014
Revenue Growth and Operating Leverage Yield Increased Profitability in 2014 Q4-14/Q4-13 FY 2014/FY 2013 Revenue Net Income Revenue Net Income 95% 400 € 95% 90% € 378.8 90% € 100 85% +48.6% 85% € 89.0 350 € +67.8% 80% 80% 75% 75% 300 € 70% 70% € 53.1 € 254.9 Gross Margin 65% € 75 Gross Margin 65% 40.
Slide 34: Besi Order Trends Highly Correlated to Assembly Equipment Industry
Besi Order Trends Highly Correlated to Assembly Equipment Industry 1.75 1.50 Assembly Market 1.26 1.25 0.97 1.03 1.01 1.10 1.00 0.94 0.95 0.81 1.00 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 Dec 14 Ja
Slide 35: Revenue/Gross Margin Trends
Revenue/Gross Margin Trends Revenue Orders Gross Margin • Quarterly revenue/order patterns show cyclicality of semiconductor business: 140 60.0% • Three cycles past 3 years 124 • Short term patterns due to customer 120 116 caution and increased seasonality 111 55.0% • 2014 year end shows higher base
Slide 36: Net Income Trends
Net Income Trends 26 25.0% Net Income ex. NR Net Income 24 Net Margin Net Margin ex. NR 22.2% • Quarterly net income trends reflect 22 20.8% industry and seasonal volatility 19.7% 20.0% 20 18 • Net margins of 22.2% in Q4-14 (euro in millions) 16 15.0% • Profit growth aided by through cycle 14 gross
Slide 37: Liquidity Trends
Liquidity Trends Quarterly Trends Cash Debt Net Cash 160 • Solid liquidity position 140 135.3 • € 135.3 million cash at 12/31/14 • € 3.59 per share vs. € 18.53 price (as of 120 December 31, 2014) 118.0 • Net cash reached € 118.0 million at year 105.4 end 2014 100 91.9 91.9 (euro in millions) 89.6 83
Slide 38: V. Outlook & Summary
V. OUTLOOK & SUMMARY February 2015 38
Slide 39: 2015 Industry Outlook
2015 Industry Outlook Global Market Environment Remains Positive 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 and capacity automotive, IOT TCB flip chip is
Slide 40: Q1-15 Guidance
Q1-15 Guidance Revenue Gross Margin Operating Expenses* Capex € 89.0 43.8% € 24.6 € 2.9 Down Up 46% Up € 0.8 - MM 0-5% 5-10% 48% Q4 Q1 Q4 Q1 Q4 Q1 Q4 Q1 *excluding restructuring • Year end backlog of € 78.7 million is 58% higher than year end 2013 despite typical H2 seasonal downturn • Revenue up ap
Slide 41: 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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