BE Semiconductor Industries N.V. · EURONEXT:BESI
BE Semiconductor Industries — Shareholder Meeting (April 2024)
40 slides from BE Semiconductor Industries's shareholder meeting presentation, Apr 25, 2024
Slide 1: Annual General Meeting of Shareholders
ANNUAL GENERAL MEETING OF SHAREHOLDERS April 25, 2024
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 presentation, including, but not limited to, statements relating to exp
Slide 3: Agenda
Agenda I. Company Overview II. Market III. ESG IV. Financial Review V. Q1-24 Results & Outlook April 25, 2024 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW April 25, 2024 4
Slide 5: Key Business Highlights 2023
Key Business Highlights 2023 Key Highlights ✓ Navigated industry downturn at high profitability levels ✓ Increased orders for next generation AI, HBM and photonics applications ✓ Well positioned for next upturn with leading advanced packaging portfolio ✓ Progress continues on hybrid bonding adoption
Slide 6: Key Financial Highlights 2023
Key Financial Highlights 2023 2023/22 € millions except % and EPS 2023 2022 Variance Revenue € 578.9 € 722.9 -19.9% Orders € 548.3 € 663.7 -17.4% Gross Margin 64.9% 61.3% +3.6 Net Income € 177.1 € 240.6 -26.4% Net Margin 30.6% 33.3% -2.7 EPS (Basic) € 2.28 € 3.03 -24.8% Return on Average Equity 33.7
Slide 7: End-User Market Trends 2022/2023
End-User Market Trends 2022/2023 Other 11% Mobile Spares/ 30% Service 17% 2023 Revenue Automotive 18% Computing 24% April 25, 2024 7
Slide 8: Performance Significantly Above Last Industry Downturn
Performance Significantly Above Last Industry Downturn € MM Revenue € MM Orders 600 578.9 600 548.3 500 500 400 356.2 400 348.7 300 300 200 200 100 100 0 0 2019 2023 2019 2023 € MM Operating Profit Operating Margin 250 40% 36.9% 213.4 35% 200 30% 25.8% 150 25% 20% 100 91.9 15% 10% 50 5% 0 0% 2019 20
Slide 9: Through Cycle Revenue and Gross Margin Trends
Through Cycle Revenue and Gross Margin Trends € millions Revenue Gross Margin Gross Margin 800 70% 64.9% 700 60% 58.0% 600 51.1% 749 50% 516 579 500 593 39.5% 40% 424 400 34.1% 379 30% 300 4 year 302 351 averages 20% 200 164 191 10% 100 0 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 201
Slide 10: Leader in Addressable Market, Die Attach Market and Advanced Die Placement
Leader in Addressable Market, Die Attach Market and Advanced Die Placement Die Attach Advanced (79% of Revenue) Die Placement** Other 26% Besi 2022 Addressable Market* 40% $1.3 Billion $400 Other Million 60% Besi 74% Besi 32% $2.0 Billion Packaging & Plating (21% of Revenue) Other 68% Besi 18% $683
Slide 11: Peer Leading Financial Metrics
Peer Leading Financial Metrics Key Financial Metrics (LTM*) Worst Besi Best Peer Peer Revenue Growth 1.3% -39.5% -39.5% -37.0% -19.9% 1.3% Besi’s margins and ROE have exceeded direct peers through Gross Margin cycles: 44.6% 44.6% 47.4% 66.8% 64.9% 66.8% • Investment in business model has yielded hig
Slide 12: Share Price Outperformance vs. Peers
Share Price Outperformance vs. Peers 2023 Total Shareholder Return 3 Year Cumulative Shareholder Return Besi vs. Peers, REM Reference Group & SOX Index Besi vs. Peers, REM Reference Group & SOX Index Besi Peer Group Average REM Reference Group PHLX Semiconductor (SOX) Besi Peer Group Average REM Ref
Slide 13: Besi Market Cap and Liquidity Has Expanded
Besi Market Cap and Liquidity Has Expanded Shareholdings Migrated from NL to US/UK over Past 5 Years Avg. Daily Volume and Liquidity* Symbol/ • BESI Index • Euronext AEX 1,400 100 1,200 80 Avg Vol * Avg Price (€ thousands) Market 1,000 Volume (thousands) 60 Market • € 10.5 billion 800 ($ 11.6 billio
Slide 14: Attractive Capital Allocation Policy Continues
Attractive Capital Allocation Policy Continues 500 Dividends € 2.0 Billion Distributions Since 2011* 435.5 Share Repurchases 416.3 400 • € 435.5 million distributed in 2023 146.8 213.4 300 • € 300 million buyback program completed: • ~4.3 million shares purchased € millions 189.7 • Average price: €
Slide 15: Business Model
Business Model Business Model Revenue € 1 billion+++ Addressable Market Share 40%+ Gross Margin 60-64% Operating Margin 30-45% Headcount Split 80% Asia/20% Europe/NA Scope 1 & 2 Emissions 62% reduction Global Energy Needs 75% from renewable sources April 25, 2024 15
Slide 16: II. Market
Besi comm Il. MARKET April 25, 2024
Slide 17: Market Conditions Reached Trough in 2023. Slow Recovery of Assembly Market
Market Conditions Reached Trough in 2023. Slow Recovery of Assembly Market TechInsights Global Chip Making Climate Trend Index 120 7/22: Memory Inventory 110 Correction 2/21: Intel, TSMC, Samsung hike capex 100 Temperature in Degrees F 90 2/20: COVID-19 outbreak 80 70 Growth Decline Line 5/19: U.S.-
Slide 18: Assembly Equipment Market Trends 2019-2026E
Assembly Equipment Market Trends 2019-2026E 8.0 80% Market Size YoY Growth Rate 7.6 68.5% 7.0 6.5 6.6 60% 6.0 5.5 5.1 US$ billions 40% TechInsights now forecasts 21% downturn 5.0 3.9 4.4 27.2% in 2023 22.5% 4.0 3.2 16.3% 16.8% 20% • Versus -26% last forecast 3.0 • ~34% decrease from 2021 peak 0% 2.0
Slide 19: Growth Expected to Favor Besi's Product Portfolio, Particularly Die Attach
Growth Expected to Favor Besi’s Product Portfolio, Particularly Die Attach CAGR (2023-2026) Die Attach 28.0% 7,574 8,000 Packaging & Plating* 19.4% 6,485 7,000 Other Assembly 17.3% 1,971 Total 20.0% 6,000 5,097 1,610 965 5,000 4,382 $ millions 1,222 822 939 4,000 644 567 3,000 4,638 4,053 2,000 3,23
Slide 20: Besi's Advanced Packaging Systems Critical for Next Generation Applications
Besi’s Advanced Packaging Systems Critical for Next Generation Applications • New generative AI engines • Edge/AI Enabled Phones • Advanced Cameras and 3D imaging Mobile • Under display biometric ID • New AR/VR devices • 5G advanced devices Solutions • New generative AI engines • Supercomputers • Hy
Slide 21: Advanced Packaging Revenue Growing Rapidly
Advanced Packaging Revenue Growing Rapidly 2.5D/3D Fastest Growing Segment 90.0 Market Revenue CAGR 78.6 80.0 Advanced Packaging 10.0% 2.5D/3D 19.7% 72.9 Besi Portfolio Well Positioned by 70.0 64.4 Node Size and Accuracy 60.0 56.9 51.9 • 70% of Besi equipment revenue $ billions 50.0 44.3 46.8 define
Slide 22: New Wafer Level Assembly Technologies Extend Moore's Law
New Wafer Level Assembly Technologies Extend Moore’s Law Moore’s Law Scaling Is Slowing Cost Per Transistor Is Increasing Traditional transistor scaling Traditional transistor scaling 3D Chiplets with hybrid bonding Source: Qualcomm and Besi April 25, 2024 22
Slide 23: Chiplet Adoption Increasing Rapidly
Chiplet Adoption Increasing Rapidly Wafer Foundry Addressable Market 300 30% 26% 250 25% 25% 70 200 20% 55 20% USD billions 37 150 15% 15% 24 1 11 100 197 10% 8% 168 149 129 126 131 50 5% 1% 0 0% 2022 2024 2026 2028 2030 2032 Monolithic Chiplet Chiplet Share Source: CSM foundry model, ISM foundry mo
Slide 24: Chiplet Adoption Drives Higher Capital Intensity
Chiplet Adoption Drives Higher Capital Intensity Single Chip Design Multi Chip Module Multi Chiplet System Monolithic: Integrated SoC Multiple Dies: process optimized Individual IPs: process optimized Source: Intel 1 Step More die attach steps Dozens 10µm Higher accuracy 100nm April 25, 2024 24
Slide 25: Key Mobile Market Drivers
Key Mobile Market Drivers Drivers Assembly solutions • New generative AI engines • Heterogeneous chiplet architectures • Edge/AI enabled phones • Co-packaged optics • Advanced cameras and 3D imaging • Periscope camera modules • Under display biometric ID • Integrated sensing/camera/display • New AR/
Slide 26: Premium Smart Phone Market Share Growing Rapidly
Premium Smart Phone Market Share Growing Rapidly *Premium segment of smart phone market= ≥$600 wholesale price Source: Counterpoint Research’s Market Pulse Service, Jan 2024 April 25, 2024 26
Slide 27: Key Computing Market Drivers
Key Computing Market Drivers Drivers Assembly solutions • Data volumes growing exponentially • New generative AI engines • 2.5D/3D chiplet architectures • Supercomputers • HBM memory stacking • Datacenters • Co-packaged optics • Edge AI tablets, PCs, laptops • Optical transceivers Computing • Gaming
Slide 28: Edge AI Computing Drives Next Generation Consumer Applications
Edge AI Computing Drives Next Generation Consumer Applications Edge AI Use Cases Mobile Phones Text Generation Audio and Video Creation XR Laptops Image and Video Enhancement Glasses Edge AI Code Generation Medical Diagnostics IoT Auto Auto Self-Driving Environmental Monitoring April 25, 2024 28
Slide 29: Key Automotive & Industrial Market Drivers
Key Automotive & Industrial Market Drivers Drivers Assembly solutions • Sinter bonding • EV adoption • Soft solder die attach • Edge AI enhanced features • Diffusion bonding • SiC and GaN power devices • Multi module die attach • Advanced camera modules and sensors • Power module molding • Autonomou
Slide 30: III. ESG
Besi comm April 25, 2024 30
Slide 31: Progress Continues on Besi's ESG Agenda
Progress Continues on Besi’s ESG Agenda 2023 Highlights ✓ Progress continues versus Besi’s 2024 ESG targets ✓ Completed 76% of ESG initiatives developed since 2020 ✓ Scope 1 & 2 emissions intensity declined by 38% versus 2021 ✓ Energy from renewable sources increased to 71% versus 20% in 2021 ✓ Set
Slide 32: New ESG Initiatives to Reduce Besi's Environmental Impact
New ESG Initiatives to Reduce Besi’s Environmental Impact Malaysia Netherlands Austria China Switzerland • Fewer shipments from the • Increased lighting energy • Expanded existing solar • Installed centrifuge to • Collaborated with Netherlands to reduce efficiency PV system increase water recycling
Slide 33: Enhanced ESG Targets
Enhanced ESG Targets 2024 2030 75% renewable sources for 100% renewable sources for global energy needs global energy needs 62% reduction in Scope 1 & 2 Carbon neutral for Scope 1 & 2 emissions* emissions* 12% reduction in Scope 3 20% reduction in Scope 3 emissions* emissions* Above-benchmark employ
Slide 34: IV. Financial Review
IV. FINANCIAL REVIEW April 25, 2024 34
Slide 35: Key Financial Metrics 2019 – 2023
Key Financial Metrics 2019 – 2023 Revenue & Baseline Opex Headcount Net Income Gross Margin 800 75% 300 40% 749.3 180 2,500 282.4 162.4 37.7% 700 2,141 160 250 35% 70% 26.2 600 578.9 2,000 1,870 140 129.2 496 134 30.6% 12.1 1,596 200 30% 500 120 177.1 64.9% 65% 106.9 62 1,500 10.0 € millions 400 100
Slide 36: Through Cycle Gross Margin Resilience and Growth
Through Cycle Gross Margin Resilience and Growth Revenue Gross Margin Gross Margin adjusted 250 80% Industry Downturn 214.0 202.4 200 75% 168.8 162.5 159.6 Gross Margin % 146.3 146.3 € millions 150 137.7 70% 133.4 123.3 67.2% 65.6% 100 64.6% 65.1% 65% 64.2% 64.0% 62.3% 62.3% 61.0% 50 60.1% 60% 0 55%
Slide 37: Strong Liquidity Position Maintained. Cash and Net Cash Increasing
Strong Liquidity Position Maintained. Cash and Net Cash Increasing 800 Cash and Deposits Net Cash 700 672.2 671.7 • Solid cash flow generation: • Net cash of € 113.0 million at year end (-67.4%) 598.7 • Includes outflows of € 435.5 million for dividends 600 and share repurchases (+ € 19.2 million vs
Slide 38: V. Q1-24 Results & Outlook
V. Q1-24 RESULTS & OUTLOOK April 25, 2024 38
Slide 39: Q1-24 Revenue and Operating Income Above Midpoint of Guidance
Q1-24 Revenue and Operating Income Above Midpoint of Guidance Guidance € millions Q1-24* Q1-24 ∆ Q4-23 ∆ Q1-23 Revenue Down 5%-15% 146.3 -8.3% +9.7% Orders 127.7 -23.3% -10.1% Gross Margin 64-66% 67.2% +2.1pts +3.0pts Opex +50-55% 57.6 +52.4% +30.9% Operating Income 35.8*** 40.7 -38.4% -2.4% Net Inc
Slide 40: Guidance Q2-24 & H1-24
Guidance Q2-24 & H1-24 € in millions Revenue Gross Margin Total Operating Expenses -15% +5 Q2-24 € 146.3 to 67.2% 63%-65% € 57.6 to -20% -5% Q1-24 Q2-24 Q1-24 Q2-24 Q1-24 Q2-24 Flat +/- 5% Revenue Gross Margin Total Operating Expenses HY1-24 € 295.6 -1% 65.0% +0.6pts € 87.7 +20%** HY1-23 HY1-24* HY1
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