Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Investor Presentation (March 2017)
44 slides from Be Semiconductor Industries's investor presentation, March 2017
Slide 1: Investor Presentation March 2017
INVESTOR PRESENTATION March 2017 1
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 ex
Slide 3: Agenda
Agenda I. Company Overview II. Market III. Strategy IV. Financial Review V. Outlook & Summary March 2017 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW March 2017 4
Slide 5: Besi Overview
Besi Overview • Leading assembly equipment supplier with #1 and #2 positions in key products. 30% addressable market share • Broad portfolio: die attach, packaging and plating Corporate Profile • Strategic positioning in substrate and wafer level packaging • Global mfg. operations in 6 countries; 1,
Slide 6: Company History
Company History 60% Die Attach Acquisitions 400 € 375.4 55% •2000 2002 2005 2009 50% 51.0% 300 Revenue (€ millions) Restructuring Gross Margin (%) 45% • European production transferred to Asia • Intellectual property remains in Europe • European headcount and footprint reduced 40% 200 • Break even r
Slide 7: Best in Class Product Portfolio
Best in Class Product Portfolio Die Attach Die Bonding Multi Module Attach Flip Chip Die Sorting Die Lid Attach • 2100 xP / hS plus • 2009 SSI • 2200 evo • 8800 CHAMEO advanced New • DS9000e • DLA New • 2100 sD plus / PPP plus • 2100 DS New • 2200 evo plus • 8800 TCB advanced New • WTT New • 2100 sD
Slide 8: Product Positioning
Product Positioning Semiconductor Manufacturing Equipment (2016: $ 42.8B)* Front end: $ 35.3B Assembly: $ 3.7B Test: $ 3.8B (82%) (9%) (9%) * Source: VLSI January 2017 Semiconductor Assembly Process Dicing Die Attach Wire Bond Packaging Plating Die Sort Die Bond Wire Bond Molding Trim & Form Plating
Slide 9: Customer Ecosystem
Customer Ecosystem Customers OEMs End Products IDMs Subcontractors • Diversified, blue chip customer base, top 10 = 47% of 2016 revenue • Leading IDMs and subcontractors. 51/49% split in 2016 • Assemble chips for leading fabless companies: Qualcomm, Broadcom, MediaTek • Long term relationships, some
Slide 10: Current Operational Profile
Current Operational Profile Duiven & Drunen, (The Netherlands) Cham, Radfeld, (Austria) (Switzerland) Chandler Suzhou Chengdu Korea Shanghai Leshan Sales Office Taiwan Shenzhen Production Site Philippines Malaysia Sales, Production & R&D Singapore Site YTD (as of December 31, 2016) • Development act
Slide 11: Summary Historical Financials
Summary Historical Financials • 2016 Results: • Renewed revenue growth (7.5%): Year Ended December 31, • Asian capacity build (€ millions, except share data) 2014 2015 2016 • New advanced packaging capacity • Increased investment in smart phone Revenue 378.8 349.2 375.4 features and sensors Orders 4
Slide 12: Shareholder Returns 2011-2016
Shareholder Returns 2011-2016 80 Cumulative: € 186.0 MM 70 67.8 60.9 60 4.0 22.4 50 € in millions 40 30 56.9 21.9 45.4 20 14.0 15.1 12.4 9.0 2.7 10 0.9 11.3 12.4 6.8 8.1 0 2011 2012 2013 2014 2015 2016 Dividends Share Repurchases • At February 22, 2017, Besi held approximately 2.8 million shares in
Slide 13: Dividend Trends
Dividend Trends Since 2011, € 5.29/Share Paid in Dividends* 2.00 1.89 12.0% 1.80 1.74 1.74 10.0% 1.60 1.50 1.40 8.1% 1.29 8.0% 1.20 1.20 Dividend Yield Dividend (€) 6.5% 1.00 6.0% 5.2% 5.5% 0.80 0.73 4.3% 4.0% 4.0% 0.60 0.42 0.43 0.40 0.30 0.33 0.22 2.0% 0.20 Payout Ratio: 30% 71% 77% 79% 93% 100% 0
Slide 14: Besi Market Information
Besi Market Information Symbol/ • BESI Average Daily Volume Index • Euronext AMX Index (shares in thousands) 400 Market • € 1,267 MM ($1,332 300 Market Profile Cap* MM) 200 100 Dividend • Pay out 40-80% of net 0 Policy income per annum 2013 2014 2015 2016 Top 10 Shareholders By Geography (% of share
Slide 15: II. Market
Besi m= - LU < ox =e = March 2017
Slide 16: Assembly Equipment Market Trends
Assembly Equipment Market Trends Assembly Equipment Market Market Size YoY Growth Rate 5.0 3.9 40% 3.1 4.1 4.2 30% 4.0 3.3 3.7 (US$ billions) 27.8% 20% 3.0 10% 12.5% 9.3% 0% 2.0 3.5% -10% 1.0 -16.3% -20% -21.9% 0.0 -30% 2013 2014 2015 2016E 2017E 2018E Source: VLSI January 2017 Besi Revenue Revenue
Slide 17: Assembly Equipment Market Composition
Assembly Equipment Market Composition Assembly Equipment Market * Besi Addressable Market * (2015: $3.3 billion) (2015: $1.3 billion) Lead Trim & Plating Form 2.3% Other Assembly 6.6% Wire Bonding Molds (Inspection, 21.5% 8.9% Dicing) 31.3% Die Attach 38.8% Presses 14.5% Die Attach 60% Plating 0.9%
Slide 18: Internet of Tomorrow Drives New Innovation Cycle
Internet of Tomorrow Drives New Innovation Cycle SoC Connectivity 5G Mobile Revolution Digital Society Requiring Increased Will Drive Functionality and Internet of Innovation in Many Leading Edge Tomorrow End User Advanced Applications Packaging Solutions March 2017 18
Slide 19: Growth in Internet Connected Devices Requires Changes in Process/Equipment
Growth in Internet Connected Devices Requires Changes in Process/Equipment Front End Today => Tomorrow Transistor scaling Lithography New structures 3D Back End Assembly More contacts Smaller pitches Thinner/denser more complex packages From simple Wire Bond to BGA/Flip Chip to complex 3D structures
Slide 20: Advanced Packaging Is the Future
Advanced Packaging Is the Future Greater Miniaturization Higher Accuracy Greater Complexity Fico Sawing Line High Growth Areas: Esec DB2100 • Mobile internet • Auto electronics • Driverless cars Esec DB2009 • Data Mining • Cloud Servers • IoT, Digital Society • Wearable devices FML wafer molding • A
Slide 21: 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 2011 - 2021 45 45.0% 40.1% 38.9% 40 37.8% 40.0% 36.7% 34.2% 35.8% • 34% of wafers use advanced packaging 35 32.4% 35.0% interconnects currently 30.6% • Rapid expansion in mobile fea
Slide 22: And Is Reflected in Besi End User Application Trends
And Is Reflected in Besi End User Application Trends 2016 35% 30% 30% 25% 24% • Mobile internet devices are 30% of revenue 20% 18% 15% • Automotive has grown 15% to 18% 10% 10% • Computer/PCs holding up due to high end 5% 3% server market 0% • Service/spare parts has increased to 15% Source: Company
Slide 23: New Smart Phone Designs Increase Besi's Addressable Market Potential
New Smart Phone Designs Increase Besi’s Addressable Market Potential Generation Generation Main Components Manufacturer IDM/OSAT Besi system Utilized 2012 2016 Processor X X Apple TSMC ->TSMC 8800CHM, MMS-LM Hynix/Micron/Sams DRAM Memory X X Hynix/Micron/Hanamicro 2100sD, FSL ung NAND Flash X X Hyni
Slide 24: Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity
Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity 2015 2021 Wire Bonding Flip Chip Bonding Flip Chip Flip Chip $265 $392 27% 30% Wire Wire Bonding Bonding $712 $896 73% Flip Chip Advantages 70% Reduces board area Offers higher speed CAGR 2015 - 2021 by up to 95%. electrical Flip Chip
Slide 25: TCB/TSV and Fan Out WLP Are Emerging Process Technologies
TCB/TSV and Fan Out WLP Are Emerging Process Technologies TCB/TSV (Substrate Based) Fan Out WLP (Wafer Level) Enabling technology for high Preferred process for high data end memory and optical transfer and optical devices in applications IoT, mobile and power Next step beyond Flip Chip 32 Stacked D
Slide 26: Besi Has Gained Share In Its Addressable Markets
Besi Has Gained Share In Its Addressable Markets Besi Market Share Source: VLSI, May 2016 and Besi estimates 2012 2013 2014 2015 Total Assembly Equipment Sales 8.5% 10.5% 12.7% 11.7% Besi Addressable Market 21.4% 25.9% 29.3% 29.6% Total Die Attach Equipment 26.8% 31.0% 36.1% 36.1% Die Bonding 29.7%
Slide 27: Besi Share of Wallet Increasing
Besi Share of Wallet Increasing Die Attach Packaging In USD 2012 2013 2014 2015 2012 2013 2014 2015 • Customers are largest semi mfrs. Subcontractors • Most advanced packaging applications ASE 65% 60% 70% 80% 35% 65% 35% 25% Amkor 75% 85% 90% 95% 45% 10% 20% 25% JCET (a) 75% 50% 70% 30% 0% 10% 0% 5%
Slide 28: III. Strategy
III. STRATEGY March 2017 28
Slide 29: Summary Strategy
Summary Strategy Maintain best in class tech leadership. Expand capabilities for: • TCB, ultra thin die, eWLB die bonding • Large area, ultra thin, wafer level molding • Solar and battery plating Increase market presence and share in addressable markets • Increase mainstream penetration with high qu
Slide 30: Besi Revenue Growth Drivers
Besi Revenue Growth Drivers World tooling up for new tech cycle <20 Higher % of nano mainstream Increased assembly smart phone equipment functionality applications Increased % Emerging of Chinese Revenue Growth process market and deployment Asian Drivers WLP and supply TCB chains New device Solar ce
Slide 31: Asian Production Transfer Has Helped Reduce Break Even Revenue Levels
Asian Production Transfer Has Helped Reduce Break Even Revenue Levels Asian Production Has Leading to Lower Fixed And Reduced Break Even Significantly Expanded European + NA Headcount Revenue Levels 1,800 847 1,586 300 900 120.0% 1,543 270 1,600 800 100.0% 1,400 250 98% 700 1,200 194 600 80.0% 802 2
Slide 32: Workforce Has Become More Asia Centric, Scalable and Flexible
Workforce Has Become More Asia Centric, Scalable and Flexible Fixed Headcount 1,800 1,586 70% 1,543 1,510 1,499 68% 1,600 1,479 1,434 63% 1,400 60% 60% 1,200 56% Headcount 54% 1,000 52% 50% 800 48% 46% 600 44% 400 40% 40% 200 37% • Asia now represents 68% of total 0 32% 30% fixed headcount 2011 2012
Slide 33: Materials Cost Reduction Is Also a Key Priority
Materials Cost Reduction Is Also a Key Priority Material costs = 40% of revenue. Largest single cost Supply Chain Actions • 75% of material now purchased in Asia • Reduced personnel, transport, logistics and inventory • Enhanced cycle time/revenue ramping capability • Will consolidate # of vendors 5
Slide 34: IV. Financial Review
IV. FINANCIAL REVIEW March 2017 34
Slide 35: Solid Q4-16 and 2016 Results
Solid Q4-16 and 2016 Results Industry Benchmark Margins Q3-16/Q4-16 2015/2016 Revenue Net Income Revenue Net Income € 100 400 € € 94.3 -1.3% € 93.1 +7.5% € 375.4 90% 90% € 349.2 350 € 80% 80% € 80 70% 300 € 70% Gross Margin Gross Margin 50.5% +2.7 points 53.2% 60% 48.8% +2.2 points 51.0% 60% 250 € €
Slide 36: Quarterly Book to Bill Ratio
Quarterly Book to Bill Ratio 1.75 1.63 Besi Assembly Equipment 1.49 1.50 1.34 1.26 1.25 1.25 1.15 1.11 1.10 1.10 1.04 1.06 1.05 1.08 1.00 1.00 0.97 0.94 Total Semi Equipment 0.86 0.75 0.72 0.68 0.69 0.50 Mar 13 Jun 13 Sept 13 Dec 13 Mar 14 Jun 14 Sept 14 Dec 14 Mar 15 Jun 15 Sept 15 Dec 15 Mar 16 Ju
Slide 37: Quarterly Revenue/Order/Gross Margin Trends
Quarterly Revenue/Order/Gross Margin Trends Revenue Orders • Cyclical quarterly revenue/order Gross Margin Adjusted Gross Margin patterns: 120.0 70.0% • Short term patterns due to customer 109 109 104 104 104 roadmaps, global GDP trends and 101 65.0% increased seasonality 100.0 95 93 92 94 • Renewed
Slide 38: Currency Exposure Trends
Currency Exposure Trends Revenue Expenses 2016 ∆ 2016 ∆ 2013 2014 2015 2016 2013 2014 2015* 2016 vs. €** vs. €** Currency Exposure (2015) Forex Financial Impact Euro 28% 34% 29% 25% 34% 32% 30% 26% US dollar 71% 65% 70% 74% 7% 4% 5% 5% Swiss franc - - - - 26% 18% 23% 21% Malaysian ringgit - - - - 22
Slide 39: Base Line Operating Expense Trends
Base Line Operating Expense Trends Base Opex Other Opex 35 32.0 29.2 29.1 29.8 28.7 28.2 30 26.5 6.3 25.3 4.3 5.5 5.1 5.7 4.1 25 4.1 3.5 20 15 25.7 24.8 24.1 24.3 23.6 22.4 23.5 21.8 10 5 0 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Baseline Opex 21.8 25.7 23.6 22.4 23.5 24.8 24.1 24.3 Other Op
Slide 40: Net Income Trends
Net Income Trends Quarterly Trends Net Income Net Margin 27 40% € 24.0 24 21 • Through cycle net margins now range 30% € 17.5 between approximately 9%-22% (euro in millions) 18 € 16.6 € 16.7 € 15.5 22.0% 15 20% • Business model more efficient through 12 18.4% 18.0% € 9.7 17.6% operating initiatives
Slide 41: Liquidity Trends
Liquidity Trends Cash and Deposits Debt Net Cash 350 304.8 300 Besi has significantly increased cash flow generation over past 5 years • Increased profits, faster cycle times, Asian 250 supply chain transfer € 56.9 MM € 45.4 MM Dividend Dividend Q4-16 vs. Q3-16 (euro in millions) 2014 2015 200 • Net
Slide 42: V. Outlook & Summary
V. OUTLOOK & SUMMARY March 2017 42
Slide 43: Q1-17 Guidance
Q1-17 Guidance Revenue Gross Margin € 93.1 53.2% 15% 54% to - 20% 52% Q4-16 Q1-17 Q4-16 Q1-17 Operating Expenses € 29.8 5% to 10% Q4-16 Q1-17 March 2017 43
Slide 44: Summary
Summary Leading semi assembly equipment supplier with #1 Technology leader. Best in Gaining market share in or #2 positions in fastest class product portfolio advanced packaging growing segments Significant upside potential Scalability and profitability Committed to enhancing of business model great
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