Siltronic Ag · XETR:WAF

Siltronic — Non-Deal Roadshow (May 2017)

27 slides from Siltronic's roadshow presentation, May 2017

  1. Slide 1: Siltronic – a leading producer of silicon wafers

    Siltronic – a leading producer of silicon wafers Roadshow Presentation April/May, 2017 © Siltronic AG 2017

  2. 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 2016 Electronics USD 1,457 bn Semiconductors USD 327 bn Semiconductor silicon wafers USD 7.2 bn Silicon for electronic applications USD 1.2 bn Source:

  3. Slide 3: Siltronic is a strong wafer supplier with leading-edge technology

    Siltronic is a strong wafer supplier with leading-edge technology Top 5 wafer producers serve more than 90% of market across all diameters 16% 10% 15% 28% 31% LG Siltron Siltronic Shin Etsu Sumco GlobalWafers Sources: Companies’ revenue reports 2016, converted to USD mn © Siltronic AG 2017 3 of 27

  4. Slide 4: 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 million 300mm equivalents per month Strong 6 demand & 300 mm 200 mm SD growth 5 4 3 Stable & 2 attractive 1 Mid-term decline 0 2010 2011 2012 2013 2014 2015 2016 2017 Source: SEMI

  5. Slide 5: 300mm demand is expected above industry capacity

    300mm demand is expected above industry capacity, after almost a decade of over-supply 300mm effective capacity vs. demand, kpcs per month ~5.3mn wafers Comments per month  Extension not considered at current price levels  ~30% to 35% overall empty shell capacity estimated to be available  Would

  6. Slide 6: Market highlights

    Market highlights Silicon wafer demand  Wafer demand stays strong, exceeding supply  Siltronic’s 300mm and 200mm production fully utilized since Q3/2016  Demand in SD wafers (<200mm) picked up; high utilization by now  Customers want to negotiate expiring contracts at earlier stages and ask for

  7. Slide 7: Silicon area demand continues to grow

    Silicon area demand continues to grow Silicon wafer demand, in bn in2 +5% 11.3e 10.7 10.4 10.1 9.4 9.0 9.0 9.1 2010 2011 2012 2013 2014 2015 2016 2017 Source: SEMI (Silicon Area until 2016), IHS Markit Technology (Semiconductor Silicon Demand Forecast Tool, Q1‘17 Update, Estimate 2017) © Siltronic A

  8. Slide 8: IHS Markit forecasts silicon wafer demand growth of 4.9% in 2017

    IHS Markit forecasts silicon wafer demand growth of 4.9% in 2017 Wafer Demand 2000/2016, in bn. cm² 2000 2016 Growth 2017 / 2016 Total market 33.6 66.4 4.9% Mobile phones / Smartphones 2.6 17.6 -1% Desktop, Notebook & Server PC 8.7 9.0 0% Industrial 5.6 7.1 9% Solid State Drives (SSD) 5.6 22% Automo

  9. Slide 9: International manufacturing network supports market leadership and business focus

    International manufacturing network supports market leadership and business focus US Germany Portland Freiberg Burghausen 200 mm 300 mm 150 200 300 mm Wafer Crystal(1) + Wafer Crystal(1) + Wafer High volume facilities for 300 mm in Germany and Singapore Among world’s newest & largest fabs in Singapo

  10. Slide 10: Customer base well diversified across all major semiconductor silicon wafer consumers

    Customer base well diversified across all major semiconductor silicon wafer consumers Siltronic is a supplier to all top 20 silicon wafer consumers Siltronic well positioned at all Top 10 customers represent ~65% major silicon consumers of 2016 revenues Source: Siltronic © Siltronic AG 2017 10 of 27

  11. Slide 11: Financials improved strongly over the last years

    Financials improved strongly over the last years Adjusted1 financial figures (EUR mn) 2012 2013 2014 2015 2016 Sales 1030.0 875.5 853.4 931.3 933.4 EBIT (75.5) (87.3) (31.6) 2.7 27.0 EBIT margin in % (7.3) (10.0) (3.7) 0.3 2.9 EBITDA 122.5 112.6 117.7 124.0 146.0 EBITDA margin in % 11.9 12.9 13.8 13

  12. Slide 12: Successful cost reduction programs continue

    Successful cost reduction programs continue Cost savings, in EUR mn1 ~55 Additional savings levers: ~45  Investing in automation in Germany  Investing in new pullers to ~30 improve yields and capabilities 15-20e  Poly cost optimization ongoing  Further productivity increases through various init

  13. Slide 13: CapEx: spending mostly for capability and cost reductions

    CapEx: spending mostly for capability and cost reductions Adjusted1 CapEx and D&A, in EUR mn CapEx 2015 and 2016  New crystal pulling hall in Freiberg  Exhange of old crystal pullers vs. state-of-the-art equipment  Automation projects in Germany ~115 ~100 2017 focus on 158.3  Capability improvem

  14. Slide 14: Siltronic Outlook 2017 (Update as of April 27, 2017)

    Siltronic Outlook 2017 (Update as of April 27, 2017) EBITDA margin at least 23%: update ROCE substantially higher than in 2016, considerably higher than WACC: update Free Cash Flow clearly positive; by far above 2016 Sales at least EUR 1.06bn: update R&D unchanged at approx. 7% of sales Cost Positio

  15. Slide 15: Appendix

    Appendix © Siltronic AG 2017 15 of 27

  16. Slide 16: Continuous improvement of key ingot and wafer properties

    Continuous improvement of key ingot and wafer properties to meet customers‘ requirements Improvement of key ingot and wafer properties Ingot Wafer doping level mechanical stability edge flatness flatness purity uniformity resistivity surface cleanliness oxygen content shape homogeneity © Siltronic A

  17. Slide 17: Financial Year 2016: Highlights

    Financial Year 2016: Highlights Sales Sales of EUR 933.4mn (2015: EUR 931.3mn) EUR 146.0mn (2015: EUR 124.0mn), EBITDA Without negative FX effects* EBITDA would have been EUR 166.9mn EBITDA margin 15.6% (2015: 13.3%) Margin Without negative FX effects* EBITDA margin would have been 17.9% EBIT positi

  18. Slide 18: Highlights Q1/2017: Financials

    Highlights Q1/2017: Financials Sales of EUR 258.0m (Q4/2016: EUR 246.3m) Sales +4.8% q-o-q EUR 53.0mn (Q4/2016: EUR 50.5m) EBITDA +5.0% q-o-q EBITDA margin of 20.5% (Q4/2016: 20.5%) Margin stable despite the usual higher cost base in Q1 compared to Q4 EUR 23.4m (Q4/2016: EUR 20.0m) EBIT +17.0% q-o-q

  19. Slide 19: Q1 sales development driven by increased prices, higher volumes and USD

    Q1 sales development driven by increased prices, higher wafer volumes and some tailwind from USD Sales, in EUR million +4.8% 258.0 246.3 Comments 237.0 229.6 220.6  Positive  Volume growth y-o-y  Higher wafer prices for 300mm and to some extent for 200mm in Q1  ASP up y-o-y and q-o-q  Some tail

  20. Slide 20: Positive development of EBITDA and EBITDA margin

    Positive development of EBITDA and EBITDA margin due to higher ASP, cost reductions and decreasing hedging expenses EBITDA margin in %; EBITDA in EUR million Comments 20.5 20.5  Positive  Higher ASP y-o-y and q-o-q 15.6 15.3  Successful cost reduction program continued 10.7  Lower hedging expens

  21. Slide 21: Positive development of net result

    Positive development of net result due to price increases, higher wafer volumes and lower costs per wafer area Result and income tax, in EUR million Comments -4.0  Net profit of EUR 17.0m in Q1/2017  Driven by price increases, higher wafer volumes and 21.0 lower manufacturing costs 17.0 per wafer

  22. Slide 22: Equity ratio of 43.3%, net financial assets of EUR 209m

    Equity ratio of 43.3% Net financial assets of EUR 209m Balance sheet, in EUR million Mar 31, Dec 31, Comments Equity and Mar 31, Dec 31, Comments Assets 2017 2016 Mar 31, 2017 liabilities 2017 2016 Mar 31, 2017 Non-current 547.0 554.1 Equity 475.1 425.3 PP&E 514.6 519.8 Siltronic 481.4 431.9 25 inta

  23. Slide 23: Pension provision increased y-o-y due to lower interest rates

    Pension provision increased y-o-y due to lower interest rates; however down q-o-q Pension provision, in EUR million 496 473 429 395 379 371 Comments 292 294 299  Changes in interest rates influence evaluation of pension provision  Change in interest rates directly reflected in equity (OCI) Q1 2015

  24. Slide 24: Payments for CapEx partly financed by customer prepayments

    Payments for CapEx partly financed by customer prepayments Cash flow, in EUR million Comments  CapEx for investments in: Q1/ Q4/ Q1/ 2017 2016 2016 − state-of-the-art crystal pullers and further automation of Cash flow from operating activities 48.7 28.7 26.8 production sites − product mix thereof

  25. Slide 25: 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: petra.mueller@siltronic.com Tel.

  26. Slide 26: 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 and other forward-looking statements that are based on management's

  27. Slide 27: SILTRONIC AG | Hanns-Seidel-Platz

    SILTRONIC AG | Hanns-Seidel-Platz 81737 München 4 Deutschland © Siltronic AG 2017

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