Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Investor Presentation (June 2017)
44 slides from Be Semiconductor Industries's investor presentation, June 2017
Slide 1: Investor Presentation June 2017
INVESTOR PRESENTATION June 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 June 2017 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW June 2017 4
Slide 5: Besi Overview
Besi Overview • Leading assembly equipment supplier with #1 and #2 positions in key markets. 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; 1,8
Slide 6: Company History
Company History 500 60% Die Attach Acquisitions 55% € 406.7 •2000 2002 2005 2009 400 Products 50% •Expanded advanced packaging leadership position and market share Revenue (€ millions) 52.6% organically and via acquisitions Gross Margin (%) 45% 300 •Gained mindshare with key industry leaders •Growth
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 • 2009 SSI • 2200 evo • 8800 CHAMEO advanced New • WTT New • DLA New • 2100 xP plus / hS • 2100 sD plus / PPP plus • 2100 DS New • 2200 evo plus • 8800 TCB advanced New • TTR New • 2100 sD
Slide 8: Product Positioning
Product Positioning Semiconductor Manufacturing Equipment (2016: $43.2B)* Front end: $35.5B Assembly: $3.7B Test: $3.9B (82%) (9%) (9%) * Source: VLSI May 2017 Semiconductor Assembly Process Dicing Die Attach Wire Bond Packaging Plating Die Sort Die Bond Wire Bond Molding Trim & Form Plating Leadfra
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 LTM (as of March 31, 2017) • Development activi
Slide 11: Summary Historical Financials
Summary Historical Financials • Renewed revenue growth since 2015: • New advanced packaging (A/P) capacity Year Ended December 31, (€ millions, except share YTD* YTD* • More investment in smart phone data) 2014 2015 2016 2016 2017 features and sensors • Asian capacity build Revenue 378.8 349.2 375.4
Slide 12: Shareholder Returns 2011-2017
Shareholder Returns 2011-2017* 80 Cumulative: € 258.7 MM Dividends and 72.7 Share Repurchases 70 67.8 7.4 Dividends Share Repurchases 60.9 60 4.0 22.4 50 euro in millions 40 65.3 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 2017 YTD * * As of J
Slide 13: Besi Market Information
Besi Market Information Symbol/ • BESI Avg. Daily Volume & Liquidity Index • Euronext Midcap AMX Avg Vol * Avg Price (€ thousands) 350 8,000 300 7,000 Volume (thousands) 250 6,000 Market • € 1,915 MM ($2,139 5,000 Market Profile Cap* MM) 200 4,000 150 3,000 100 2,000 Dividend • Pay out 40-80% of net
Slide 14: II. Market
II. MARKET June 2017 14
Slide 15: Assembly Equipment Market Trends
Assembly Equipment Market Trends Assembly Equipment Market Market Size YoY Growth Rate 5.0 30% 3.9 4.1 4.3 4.0 3.7 20% (US$ billions) 27.1% 3.0 3.2 15.4% 10% 3.0 11.8% 5.0% 0% 2.0 -10% 1.0 -20% -22.0% -17.3% 0.0 -30% 2013 2014 2015 2016E 2017E 2018E Source: VLSI May 2017 Besi Revenue Revenue YoY Gro
Slide 16: Assembly Equipment Market Composition
Assembly Equipment Market Composition Assembly Equipment Market * Besi Addressable Market * (2016: $3.6 billion) (2016: $1.4 billion) Lead Trim & Plating Other Form 2.0% Assembly 6.6% Wire Bonding Molds (Inspection, 21.8% 9.8% Dicing) 29.7% Die Attach 41.0% Presses 16.8% Die Attach 55% Plating 0.8%
Slide 17: 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 June 2017 17
Slide 18: 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 19: 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 20: 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% 35.8% • 34% of wafers use advanced packaging 34.2% 35 32.4% 35.0% interconnects currently 30.6% • Rapid expansion in mobile fea
Slide 21: Besi End User Application Trends
And Is Reflected in Besi End User Application Trends 2016 % of Revenue 35% 30% 30% • Mobile Internet 25% 24% devices, Computing and Automotive are 20% 18% Besi’s three largest 15% and most rapidly 15% growing end user 10% markets 10% 5% 3% • Computer/PCs holding up due to high end 0% server market •
Slide 22: New Smart Phone Designs Increase 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 23: Expanding Chinese Market Presence Is a Priority
Expanding Chinese Market Presence Is a Priority China Customer Revenue and Units Shipped 100% 200 20% 23% 30% 80% 50% 150 % of total revenue 139 60% Units 100 40% 80% 77% 70% 50% 50 20% 33 0% 0 0 2014 2015 2016 Objective Other Besi Revenue China Revenue Units shipped from Chinese plant • Chinese gov
Slide 24: Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity
Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity 2016 2021 Wire Bonding Flip Chip Bonding Flip Chip $340 Flip Chip 30% $535 Wire Wire 35% Bonding Bonding $805 $989 70% 65% Flip Chip Advantages Reduces board area Offers higher speed CAGR 2016 - 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 Source: VLSI, May 2017 and Besi estimates~ 2012 2013 2014 2015 2016 2017E* Besi Addressable Market 21.7% 26.4% 30.5% 31.3% 29.8% ~35% Total Die Attach 27.5% 31.9% 37.1% 37.5% 37.2% Die Bonding 29.7% 39.1% 40.3% 38.9% 37.5% Flip Chip 22.2% 24.1% 33.2%
Slide 27: And Has a Large Share of Wallet at Key Customers
And Has a Large Share of Wallet at Key Customers Die Attach Packaging 2014 2015 2016 2017 2014 2015 2016 2017 • Customers are largest YTD* YTD* semi mfrs. engaged in Subcons most advanced packaging ASE 70% 80% 70% 40% 35% 25% 15% 20% applications Amkor 90% 95% 95% 100% 20% 25% 10% 35% JCET/Stats 70%
Slide 28: III. Strategy
III. STRATEGY June 2017 28
Slide 29: Summary Strategy
Summary Strategy Maintain best in class tech leadership. Expand capabilities for: • eWLB, TCB, ultra thin die bonding • Large area, ultra thin, wafer level molding • Solar and battery plating Increase market presence and share in addressable markets • Increase addressable market share to 35-40% over
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 1,800 847 300 900 120.0% 1,543 1,549 270 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 1,549 1,617 80% 1,543 1,489 1,489 1,600 1,475 1,404 1,400 69% 70% 67% 1,200 64% Headcount 60% 60% 1,000 57% 54% 800 52% 50% 600 48% 46% 43% 400 40% 40% 200 36% • Asia now represents 69% of total 0 33% 31% 30% fixed h
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 June 2017 34
Slide 35: Strong Q1-17 and 2016 Results. Industry Benchmark Margins
Strong Q1-17 and 2016 Results. Industry Benchmark Margins Q1-17/Q1-16 2015/2016 Revenue Net Income Revenue Net Income 100% 400 € € 110.2 +7.5% € 375.4 90% +39.5% 90% € 349.2 € 100 350 € 80% 80% € 79.0 Gross Margin 300 € 70% € 80 49.2% +6.5 points 55.7% 70% Gross Margin OPEX +2.2 points 48.8% 51.0% 6
Slide 36: Quarterly Semi Equipment Book to Bill Ratios
Quarterly Semi Equipment Book to Bill Ratios 1.75 Besi Assembly 1.63 Equipment 1.50 1.34 1.25 1.25 1.25 1.10 1.10 1.05 1.06 1.02 1.00 1.00 1.06 0.98 1.00 Total Semi 0.86 Equipment 0.92 0.90 0.75 0.50 Dec 13 Mar 14 Jun 14 Sept 14 Dec 14 Mar 15 Jun 15 Sept 15 Dec 15 Mar 16 Jun 16 Sep 16 Dec 16 Total E
Slide 37: Quarterly Revenue/Order/Gross Margin Trends
Quarterly Revenue/Order/Gross Margin Trends • Cyclical quarterly revenue/order Revenue Orders Gross Margin patterns: • Short term patterns due to customer roadmaps, global GDP trends and 300.0 70.0% increased seasonality • Industry growth accelerated in H2-16 65.0% • Q1-17 orders rose 162.4% vs. Q4-
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: Quarterly Base Line Operating Expense Trends
Quarterly Base Line Operating Expense Trends Base Opex Other Opex 35 29.8 30.5 29.2 29.1 28.2 30 4.9 4.3 5.5 5.7 4.1 25 20 15 24.8 24.1 24.3 25.6 23.5 10 5 0 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Baseline Opex 23.5 24.8 24.1 24.3 25.6 Other Operating Expenses Capitalization of R&D (1.8) (1.5) (1.6) (1.9) (1
Slide 40: Net Income Trends
Net Income Trends • Through cycle net margins now range between approximately 10%-22% Net Income Net Margin • Business model more efficient through 27 40% operating initiatives € 24.0 € 24.3 • Gross margin range has steadily improved 24 despite revenue volatility • Baseline quarterly opex of € 24 -
Slide 41: Liquidity Trends
Liquidity Trends Cash and Deposits Net Cash 350 304.8 309.0 300 Besi has significantly increased cash flow generation over past five years • Net cash up > 2x between 2012 and 250 2016 • Despite €164.1 million of dividends and share repurchases € in millions 200 • Increased profits, faster cycle time
Slide 42: V. Outlook & Summary
V. OUTLOOK & SUMMARY June 2017 42
Slide 43: Q2-17 Guidance
Q2-17 Guidance Revenue Gross Margin € 110.2 55.7% 40% 54% to - 50% 56% Q1-17 Q2-17 Q1-17 Q2-17 Operating Expenses € 30.5 10% to 15% Q1-17 Q2-17 June 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 grea
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