Bruker Corporation · NASDAQ:BRKR
Bruker — Investor Day (June 2019)
128 slides from Bruker's investor day presentation, Jun 20, 2019
Slide 1: Bruker Corporation Investor Day
Bruker Corporation Investor Day June 20, 2019 © Bruker Corporation Innovation with Integrity
Slide 2: Safe Harbor Statement
Bruker Corporation Safe Harbor Statement Any statements contained in this presentation that do not describe historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Security Exchange Act of 1934, as
Slide 3: Agenda
Agenda Time Subject Presenter 7:45am Registration and breakfast 8:00am 1) Bruker Transformation & New Strategy (30 min) Frank H. Laukien, President & CEO 8:30am 2) Neuroscience & Cell Microscopy Initiative Mark R. Munch, PhD, President, Bruker NANO Group 3) Semicon Metrology & Nanotech Initiative (2
Slide 4: 1) Bruker Transformation & New Strategy
1) Bruker Transformation & New Strategy Frank H. Laukien President and CEO © Bruker Corporation Innovation with Integrity
Slide 5: Bruker Mission, Purpose & Culture
Bruker Mission, Purpose & Culture Our values: Innovation with Integrity Our Mission Our Values Our high-performance scientific instruments, We value integrity, respect and trust within a analytical and diagnostic solutions, and fast-paced and dynamic environment built comprehensive support, enable t
Slide 6: Unique Culture and Proven Bruker Management Process
Unique Culture and Proven Bruker Management Process Adopted in 2014, our unique Bruker Management Process has been steadily refined over the last 5 years. It has helped create a novel strategy, repositioned our portfolio, accelerated growth and expanded margins. Our culture fosters Combined with our
Slide 7: Bruker History
Bruker History Approaching 60 years of Innovation 2013-today Acquires multi- 2008 photon, super-res Bruker Corp. and light-sheet FM; 1960 2000 merges with Bruker forms Semi Bruker co-founded Biospin into one division, acquires by Prof. G. Laukien Bruker Nasdaq-traded 1980s-today Jordan Valley & Rave
Slide 8: Bruker Overview: 2018 revenue mix
Bruker Overview Our 2018 revenue mix Business Group Mix Geographic Mix Bruker Scientific Segment Market Mix Academic & 47% Govnmt Research BIOSPIN Industrial Research 21% Group 31% NANO & Other Industrial 30% Group Pharma & 14% 30% 37% 29% Biopharma 10% 29% Microbiology & 7% BEST Molecular DX Segmen
Slide 9: Bruker Overview: people, production and R&D
Bruker Overview Our people, production and R&D 6,900 14 1,200 4,000 + Employees Major manufacturing Employees dedicated Patents pending or sites in N. America, to R&D granted Europe and Asia 9
Slide 10: Market leading positions
Bruker Overview Market leading positions Bruker holds #1 or #2 market positions in ~70% of our portfolio NMR and EPR Preclinical Imaging: MRI, Mass Spec Imaging, Atomic Force Spectroscopy MPI, PET/MR, microCT MALDI-TOF and MRMS Microscopy (AFM) FT-IR/NIR Spectroscopy X-Ray Diffraction (XRD) Next-Gen
Slide 11: BEST Segment
BEST Segment Technology, customers & markets Technology Areas of Bruker EST Segment Key Customers BEST Revenue 2018: $189m • Low-Temperature Superconductors (LTS) for Clinical MRI Industry • High-performance superconductors for NMR, EPR, MRI, 6% MRMS, as well as for fusion research and ‘Big Science’
Slide 12: Selected Acquisitions in Recent Years
Selected Acquisitions in Recent Years Strategically focused expansion and synergistic ‘bolt-on’ M&A Neuroscience & Biopharma & Microbiology & Consumables & Semi Metrology & Cell Microscopy Applied Diagnostics Scientific Software NANO Group ‘bolt-on’ Bruker Molecular Diagnostics (Glasgow) 12
Slide 13: Bruker's New Strategy
Bruker’s New Strategy Project Accelerate & Operational Excellence drive customer success and profitable growth • Transforming our portfolio for attractive secular growth trends • Driving key product innovation cycles Profitable • Advancing six high-growth, high- Growth margin Project Accelerate init
Slide 14: Bruker Repositioned for Key Secular Growth Trends
Bruker Repositioned for Key Secular Growth Trends Crucial growth drivers do not depend significantly on macro or geography Next-generation proteomics Beyond ss-RNA-Seq: Human Brain Project drives Precision Medicine drives In vivo life-cell microscopy, and phenomics; emergence Human Cell Atlas & neur
Slide 15: Bruker Scientific Instruments Innovation
Bruker Scientific Instruments Innovation: Compelling new product cycles and superior solutions innovation timsTOF Pro & flex, MALDI Biotyper, Molecular GHz-class NMR, Unique NMR & MS rapiflex, scimaX DX & LiquidArray SPs UHF MRI , Avance NEO biopharma solutions Unique NMR & MS Super-resolution, ligh
Slide 16: Project Accelerate
Project Accelerate Seeking faster revenue growth from six targeted high-growth, Proteomics & high-margin initiatives Phenomics After Market & Scientific Software Proteomics & Phenomics After Market & Biopharma & Services, consumables for Bruker LST & Scientific Software Applied High-performance NMR
Slide 17: Project Accelerate Portfolio Roadmap
Project Accelerate Portfolio Roadmap Reshaping our portfolio for faster growth and higher margins* 2018 2019E 2020E 2021E 2022E 2023E Proteomics & timsTOF Pro 4D Proteomics, 4D Lipidomics; 1.0 GHz NMR Phenomics Mass spec-based Phenomics, 1.1-1.2 GHz NMR Biopharma & Advanced NMR and MS solutions for
Slide 18: Bruker Goals: Key Objectives for 2019-2022
Bruker Goals: Deliver industry-leading non-GAAP operating Key Objectives for 2019 –2022 margin expansion and strong earnings growth 1. Accelerate high-quality revenue growth • Enhance growth with Project Accelerate, drive key secular growth opportunities, further advance innovative product cycle, de
Slide 19: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 19
Slide 20: 2) Neuroscience and Cell Biology 3) Semiconductor and Nanotech Initiative
2) Neuroscience and Cell Biology 3) Semiconductor and Nanotech Initiative Mark R. Munch, PhD President, Bruker NANO Group © Bruker Corporation Innovation with Integrity
Slide 21: Mark R. Munch, PhD
EXECUTIVE BIO Mark R. Munch, PhD President, Bruker NANO Group • President, Bruker Nano Group, consisting of four global divisions • Executive Vice President of Bruker Corporation, focus on Bruker Management Process and IT oversight • Over 25 years managing significant businesses of multi-national co
Slide 22: Bruker NANO Group Overview
Bruker NANO Group Overview Bruker NANO Revenue (in $M) Technology Areas of Bruker NANO Group • X-ray Diffraction and Elemental Analysis 2017-18 10.7% • Surface and Dimensional Analysis • X-Ray Microscopy • Semiconductor Metrology • Advanced Fluorescence Microscopy (FM) 2016-17 12.8% Market leader in
Slide 23: Bruker NANO Group Overview: excellence and growth initiatives
Bruker NANO Group Overview Commercial, operations, and product development excellence: • Continuous stream of new products > 20 new products • Top-line growth while delivering op profit launched over last expansion 3 years • Best-cost manufacturing strength, including Bruker Penang • Supplemented ac
Slide 24: 2) Neuroscience and Cell Biology
2) Neuroscience and Cell Biology Fluorescence Microscopy Initiative
Slide 25: Neuroscience and Cell Biology Fluorescence Microscopy Initiative
Neuroscience and Cell Biology Fluorescence Microscopy Initiative Helping visualize how life works 3D Cell Spheroid Growth Segment with Focus on Advanced Technologies • Trend towards live-cell, in vivo imaging • Strong trend towards more spatial and temporal information • Strong funding for neuroscie
Slide 26: Expand our Fluorescence Microscopy Portfolio
Expand our Fluorescence Microscopy Portfolio To See Spatial Relationships in Live Cells Advanced Technologies for Live-Cell Imaging Across Spatial Length Scales Localized 3D organoids Whole tissue regions and single cell Molecular Light Sheet Light Sheet Confocal and Light Multiphoton Super Resoluti
Slide 27: Advanced Portfolio for In Vivo and Live-Cell Imaging
Advanced Portfolio for In Vivo and Live-Cell Imaging Leveraging the trend towards ‘Seeing’ Living Specimens, 3D Cultures, In Vivo HIGH GROWTH MARKET • Strategic acquisitions of key technologies • High growth market (strong publication rate) Total available $0.8B market • Advanced technology portfoli
Slide 28: Recent FM Highlights
Recent FM Highlights Continued Product Innovation Continued Sales and Sales Applications Expansion 5 years ago End of 2018 2 2X 4 • Launched Ultima 2Pplus for leading neuroscience microscopy microscopy • Launched light-sheet MuVi CS (cleared sample) for platforms platforms neuroscience and whole tis
Slide 29: Multi-Photon Imaging in Neuroscience
Enabling visual understanding of brain function and neurological diseases: Multi-Photon Imaging in Neuroscience Leader in innovation for imaging in neuroscience: KEY OPINION LEADER SPOTLIGHT Deisseroth Lab, Stanford University Multi-photon imaging for optogenetics, deep-tissue imaging, and neuro-pho
Slide 30: Light-Sheet Imaging in Developmental Biology
Helping visualize how life develops: Light-Sheet Imaging in Developmental Biology Leader in low phototoxicity, long-time studies: KEY OPINION LEADER SPOTLIGHT Hufnagel and Ellenberg Lab, EMBL, High resolution, fast imaging that is gentle Heidelberg • Light-sheet solutions (Luxendo MuVi, Invi and QuV
Slide 31: Super-Resolution Imaging in Genomics
Helping visualize how molecular life works: Super-Resolution Imaging in Genomics Leader in multiplex labeling experiments: KEY OPINION LEADER SPOTLIGHT Wu Lab, Harvard University Imaging with coordinated automated fluidics • Key opinion leaders using 3D super-resolution Vutara Imaging DNA Compartmen
Slide 32: What Differentiates Bruker
What Differentiates Bruker Well-funded end markets ~$3B / year Continued collaboration and innovation with Key Opinion Leaders Focus on unique, advanced technologies Continued expansion of channel Leverage best-cost supply chain 32
Slide 33: 3) Semiconductor and Nanotech Initiative
3) Semiconductor and Nanotech Initiative
Slide 34: Market Driver: Growth in distributed computing and storage
Semiconductor Metrology and Nanotech Initiative Market Driver: Growth in “distributed computing and storage” Tremendous growth in need for distributed computing and data storage… …demands development of “faster/more compact” chips… Computational Processing Chips DRAM Memory Chips 3D NAND Memory Chip
Slide 35: Semiconductor Metrology: internet growth
Semiconductor Metrology and Nanotech Initiative Market Driver: Growth in “distributed computing and storage” Tremendous growth in need for distributed computing and data storage… 30% CAGR in internet growth 35
Slide 36: Growth drives increase in fab equipment spend
Semiconductor Metrology and Nanotech Initiative Growth in “distributed computing and storage” will drive increase in fab equipment spend Wafer process equipment spend increasing …demands development of “faster/more compact” chips… DRIVE TO IMPROVE: Speed • Computational Processing Chips Bit density
Slide 37: Where Nanotech meets manufacturing – 3D and new materials
Semiconductor Metrology and Nanotech Initiative Where Nanotech meets manufacturing – 3D and new materials complex Where Bruker NANO fits in: 3D structure characterization New chip structures/materials pose measurement and characterization challenges: • more complex, 3D Structures • extremely small d
Slide 38: Measurements at nanoscale
Semiconductor Metrology and Nanotech Initiative Where Nanotech meets manufacturing – measurements at nanoscale X-Ray and AAFM Estimated 5-yr >12% Semi 10nm, 7nm, 5nm, 3nm nodes business CAGR Human hair Red blood cell Mitochondria Flu virus 0.1nm 100,000nm 10,000nm 1000nm 100nm 10nm 1nm (1 angstrom)
Slide 39: Recent Semi/Nano Highlights
Recent Semi/Nano Highlights Continued Product Innovation Continued Application/Insertion Point Penetration 5 years ago End of 2018 Semi Division • Revenue growth of 24% over 2017 on new automated AFM No Bruker Semi with Dedicated Insight CAP tool Division Sales and R&D • Greater than 20% revenue gro
Slide 40: Photomask Defect Review, Characterization and Repair
Semiconductor Metrology and Nanotech Initiative Photomask Defect Review, Characterization and Repair Automated AFM defect review and characterization: Drivers: Smaller nodes Complex masks Extreme UV (EUV) 3D characterization of photomask defect Rave nano-repair tools, including nanomachining: CAGR N
Slide 41: X-Ray Critical Dimension (XCD) Metrology
Semiconductor Metrology and Nanotech Initiative X-Ray Critical Dimension (XCD) Metrology >$100M opportunity Need to Characterize High Aspect Ratio Dimensions Using X-Ray Determines profiles 3D vertical NAND memory design 41
Slide 42: What Differentiates Bruker
What Differentiates Bruker Extend technology lead and Market leader in Technology brand in Semi adaptation of Automated AFM leader in Semi X- X-Ray and AFM Ray Leverage innovations from Market leader in Highest number our strong X-Ray and AFM scientific AFM of X-Ray research segments modalities Dire
Slide 43: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 43
Slide 44: 4) Pharma & Biopharma Initiative 5) After-Market & Scientific Software Initiative
4) Pharma & Biopharma Initiative 5) After-Market & Scientific Software Initiative Dr. Falko Busse President, Bruker BioSpin Group © Bruker Corporation Innovation with Integrity
Slide 45: Dr. Falko Busse
EXECUTIVE BIO Dr. Falko Busse President, Bruker BioSpin Group • 20 years of experience in management of significant growth opportunities in Philips healthcare business • Strong record in building new businesses & creating new markets with novel market insights and technology innovation • Deep expert
Slide 46: Bruker BioSpin Group Overview
Bruker BioSpin Group Overview Technology Areas for Bruker BioSpin Group BioSpin Revenue in $M BioSpin Non-GAAP Operating Margin • Nuclear Magnetic Resonance (NMR) Spectroscopy $591 • Electron Spin Resonance (EPR) $572 Strong BioSpin • Preclinical Magnetic Resonance Imaging (MRI) $563 • Preclinical P
Slide 47: Bruker BioSpin Group Overview: excellence
Bruker BioSpin Group Overview Commercial, operations and product development excellence driven by Bruker Management Process Strong in Aca/Gov Product Leadership Strategic Software M&A Aftermarket Growth Higher margins and Life-Science research cash generation core markets • BioSpin portfolio reorien
Slide 48: First 1.2 GHz magnet has reached field
Bruker BioSpin Group Overview Breaking news: First 1.2 GHz magnet has reached field in our Swiss factory When Order Backlog Expected Delivery Manufacturing Capacity Stabilization Time May 2019 9 systems Q1 2020 3 / year 6 months 48
Slide 49: 4) Pharmaceuticals & Biopharma Initiative
4) Pharmaceuticals & Biopharma Initiative
Slide 50: Pharma/Biopharma market dynamics
Pharma/Biopharma market dynamics LST TAM in Pharma $16B CAGR 6.5% * (TAM = Total Addressable Market) Attractive opportunities for Bruker’s unique, high- value NMR, MS and FT-IR/NIR solutions Bruker Est. SAM in Pharma ~$3B Estimated CAGR > 12% (SAM = Served Addressable Market) Fundamental trends in P
Slide 51: Key BioPharma Growth Initiatives
Key BioPharma Growth Initiatives Leverage unique Bruker Pharma/Biopharma solutions, as well as Bruker macro-molecule core competencies in NMR and MS 1 Serve broader value chain 2 Expand to specialty CROs and clinical trials 3 Grow with Biologics High-end NMR and MS for Discovery, Development and PAT
Slide 52: BioPharma Horizon Strategy
BioPharma Horizon Strategy Leverage footprint in drug discovery and big pharma to expand into biologics, CROs and adjacent markets DISRUPTIVE SOLUTIONS continuous modular quality assurance structure elucidation • Implemented 3-horizon and metabolite innovation model for identification faster growth
Slide 53: Serve Broader Value Chain
1 Serve Broader Value Chain Leverage existing Bruker customer partnerships to grow into drug development, pharmaco-proteomics, and manufacturing High performance Discovery High performance Development Integrated solutions for pharma PAT and QC • Label-free uHT MS screening • Superior biosimilars ass
Slide 54: Label-Free Ultra-High Throughput Screening by MALDI PharmaPulse
1 Serve Broader Value Chain Label-Free Ultra-High Throughput Screening by MALDI PharmaPulse™ MS offers direct, label-free readout for primary library screening and secondary validation assays • Dose-response curves • Drug profiling Bruker’s rapifleX Maldi PharmaPulse system benefits: Speed: 1536 sam
Slide 55: Label-Free Drug and Metabolite Distribution by MS Imaging
1 Serve Broader Value Chain Label-Free Drug and Metabolite Distribution by MS Imaging • Drug-to-target engagement • Toxicology during drug development • Drug efficacy for immuno-oncology Bruker’s MS Imaging systems provide: SpatialOMx™ for inter- and intra-cellular networks ✓ lower cost and greater
Slide 56: Process Analytical Technology (PAT)
1 Serve Broader Value Chain From testing quality to building quality Process Analytical Technology (PAT) into products and processes by NIR, NMR & MS Process Process understanding optimization Bruker’s instrumentation delivers multi-quality attributes for PAT process optimization and control: Bio-PA
Slide 57: Expand to Specialty CROs and Clinical Trials
2 Expand to Specialty CROs and Clinical Trials Typically 90% drop in drug sales 3 years Polymorphs by NMR & XRD after patent expires - a billion $ IP ‘war’ Combo Bio availability Polymorph patents are a key strategy for both: -66% Line extension i. Innovators: to extend market exclusivity — Lipitor®
Slide 58: Growth with Biologics
3 Growth with Biologics Cost of drug development has doubled Unique NMR and MS Capabilities Accelerate over the past decade Drug Releases 12 YEARS 8 YEARS As a technology leader in NMR and MS, Bruker provides the AVG TIME TO MARKET MARKET EXCLUSIVITY <12% superior data needed to accelerate discovery
Slide 59: Identify and Quantify Impurities in Bioproduction by TIMS/PASEF
3 Growth with Biologics Identify and Quantify Impurities in Bioproduction by TIMS/PASEF • Host Cell Proteins (HCP) are low-level impurities, derived from the host organism during bioproduction • HCP control is a regulatory requirement for drug safety timsTOF Pro for fast and comprehensive HCP screen
Slide 60: 5) Aftermarket and Software Initiative
5) Aftermarket and Software Initiative
Slide 61: Build an industry-leading aftermarket business
Build an industry-leading Bruker Aftermarket is sizeable aftermarket business With SAM >$1.2B CAGR 5-9% Long-term sustainable growth & margin engine Double digit growth examples: • Continuous growth of services & aftermarket • LabScape service contracts 2016 - 2019E • Consumables & accessories 2016
Slide 62: Proprietary remote service solution with IoT approach
Proprietary remote service Predictive Service paradigm: Sell uptime! solution with IoT approach Increase attach rate and enable new biz models • Increasing portion of NMR installed base protected by remote magnet monitoring • Design for data-driven services via intelligent devices • High-value feedb
Slide 63: Aftermarket Portfolio Transformation
Aftermarket Portfolio Transformation From ‘repair/fix’ to trusted business partnering Horizon 1 Horizon 2 Horizon 3 Increase Coverage Beyond Repair/Fix Beyond installed base … 6363
Slide 64: Building a Unique Scientific Software & Lab Informatics business
Building a Unique Scientific Software & Lab Informatics business Create value from end-to-end data integration enterprise set of fully informatics integrated software • Attractive market fundamentals of lab informatics with suites intelligent data TAM size of $1.2B and CAGR of 12% * acquisition anal
Slide 65: What Differentiates Bruker
What Differentiates Bruker Aftermarket & software solutions for today’s and tomorrow’s customers Track record of strongly growing BioSpin aftermarket business with growing portfolio of services and aftermarket products Innovation pipeline of digital services, driven by disciplined entrepreneurship V
Slide 66: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 66
Slide 67: 6) Microbiology & Diagnostics Initiative 7) Applied Markets Initiative
6) Microbiology & Diagnostics Initiative 7) Applied Markets Initiative Juergen Srega President, Bruker CALID Group Innovation © Bruker Corporation with Integrity
Slide 68: Juergen Srega
EXECUTIVE BIO Juergen Srega President, Bruker CALID Group • Over 30 years of experience managing global businesses of multi-national corporations with strong leadership and broad technical and financial skills. • Strong track record of building high-growth organizations that foster organizational, o
Slide 69: CALID Group is Accelerating Revenue Growth and Expanding OPM
CALID Group is Accelerating Revenue Growth and Expanding OPM Building market-leading positions in attractive segments Technology Areas for Bruker CALID Group CALID Group Revenue (in $M) Revenue Growth YoY • Life Science Mass Spectrometry $548 9.8% 2017–18 • Microbiology & Diagnostics $499 • Vibratio
Slide 70: Driving Project Accelerate with Leading Product Innovation
Driving Project Accelerate with Leading Product Innovation Complemented by key strategic acquisitions timsTOF Pro & fleX scimaX rapifleX MALDI ALPHA II INVENIO Major product innovations and BioTyper FT-IR FT-IR strategic acquisitions drive above market growth: • Continuous stream of differentiated n
Slide 71: 6) Microbiology & Diagnostics Initiative
6) Microbiology & Diagnostics Initiative © Bruker Corporation
Slide 72: Global market for microbiology and infectious disease
Global market for microbiology and infectious disease In 2018, TAM >$20B with 5-7% CAGR I N F EC T I O U S D I S EA S ES / F O O D P RO D U C T I O N INFECTIOUS DISEASES A N T I B I OT I C ST E WA R D S H I P F O O D M I C RO B I O LO GY/ H YG I E N E Growing Population Aging Population Spreading of
Slide 73: Bruker Microbiology & Molecular DX SAM Greatly Increased
Bruker Microbiology & Molecular DX SAM Greatly Increased by in-house developments and acquisitions Bruker Microbiology & Infectious Disease Molecular Diagnostics Market Identification Antibiotic Hospital Hygiene, Molecular Syndromic ~$800m Testing* Infection Control Diagnostics Panels >$2.5B > $200m
Slide 74: Bruker Microbiology & molDX SAM Systematically Increased
Bruker Microbiology & molDX SAM Systematically Increased by in-house developments and acquisitions Existing Products New Products New Bruker Diagnostics - Glasgow Fast ID Market Product • Specialty real-time PCR assays for Existing MALDI Biotyper (MBT) Penetration Development invasive fungal disease
Slide 75: MALDI Biotyper Installed Base Growing Globally
MALDI Biotyper Installed Base Growing Globally MALDI ID is new ‘gold-standard’ for fast ID from cultures Installed MALDI Biotyper base • >3,500 MBT units end of Q2-19 • Estimated >150 million IDs per year on MBTs • Growing by >400 units annually 665 • Great collaborations with major DX partners 1740
Slide 76: Growing MALDI Biotyper Base Accelerating Recurring Revenue
Growing MALDI Biotyper Base Accelerating Recurring Revenue Growth with new kits, consumables and services Estimated IDs on installed Microbiology Aftermarket revenue mix: global MALDI Biotyper base: 70% 45% 160M 83% 86M 40M 55% 2013 2016 2019E 30% 17% 2013 2016 2019E Systems and Accessoires Aftermar
Slide 77: Increasing Diversification from Microbial Identification
Increasing Diversification from Microbial Identification Growth in antibiotic resistance testing, hygiene and molecular diagnostics Roadmap: MBT fast AST on Maldi Biotyper, LiquidArray™ Syndromic Panels on Fluorocycler XT platform Microbiology & Diagnostics revenue mix: 65% 90% 100% 35% 10% 2016 201
Slide 78: What Differentiates Bruker
What Differentiates Bruker Bruker changing microbiology by highly differentiated, disruptive innovations MALDI Biotyper IR Biotyper Micronaut AST Bruker-Hain Diagnostics Microbial Identification Hospital Hygiene/ Antibiotic Resistance/ Molecular Diagnostics/ Epidemiology Susceptibility Testing Multi
Slide 79: 7) Applied Markets Initiative
7) Applied Markets Initiative © Bruker Corporation
Slide 80: Bruker Focused on Attractive and Differentiated Applied Segments
Bruker Focused on Attractive and Differentiated Applied segments1 Large $2.5B market for LST in food & environmental analysis Quality Assurance/ Food Food Environmental Quality and Freshness Control Authenticity Safety • Oxidation • Origin and variety • Pesticides • AgroChem • Corking • Aging • Myco
Slide 81: Bruker Plans Double Digit Growth in Applied Market Revenue
Bruker Plans Double Digit Growth in Applied Market Revenue Bruker Applied SAM1 (in $M) Major market drivers • Globalization of food market and food supply chain • Food fraud costs are multi-billion per year • Brand protection +5% • Stronger regulations and controls • Consumer and public awareness 94
Slide 82: Broad Bruker Instruments and Applied Applications Portfolio
Broad Bruker Instruments and Applied Applications Portfolio Serve broader value chain for selected, high-value Applied solutions Bruker instruments & applied solutions PRODUCT INNOVATION BASIC RESEARCH VOLUME MFG; PILOT MFG SOURCING FINISHED GOODS In/At-line Process Control PRODUCT DEVELOPMENT • Dai
Slide 83: What Differentiates Bruker
What Differentiates Bruker Bruker offers unique solutions in Applied markets by setting new standards in information content, automation and cost/sample Quality Assurance/ Food Authenticity Food Safety Quality and Freshness Control • A leading supplier of FT-NIR and TD-NMR • Leader in food screening
Slide 84: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 84
Slide 85: 8) Proteomics & Phenomics Initiative
8) Proteomics & Phenomics Initiative - includes Structural Biology - now also includes Spatialomics Frank H. Laukien, Ph.D. Innovation with Integrity © Bruker Corporation 85
Slide 86: A) Functional Structural Biology
A) Functional Structural Biology • Avance NEO and proprietary CryoProbes on GHz-class NMR systems can provide dynamics and function of proteins and macromolecular complexes • Unlike crystallography and cryoEM, most NMR data is acquired at physiological conditions (pH, temperature) in April 2019: Bru
Slide 87: A) Functional Structural Biology: GHz-class NMR customers
A) Functional Structural Biology Key Opinion Leaders demonstrate 1.2 GHz Customers in Europe Scientific Benefits of GHz-class NMR Utrecht University; Max Planck Institute for “We appreciate this important milestone in UHF NMR. The Netherlands Biophysical Chemistry in The 1.1 GHz results we achieved
Slide 88: B) Precision Medicine & Phenomics
B) Precision Medicine & Phenomics Disease prevention, diagnosis & therapy Aging population Increasing health monitoring supported by phenomics demographics care costs • Analyze dynamic interactions between genes, diets, environments and lifestyles • Longitudinal epidemiology studies for improved hea
Slide 89: Key Technologies: Fusion of NMR & MS
B) Precision Medicine & Phenomics: Key Technologies: Fusion of NMR & MS Information and Insights Avance IVDr NMR UPLC-QTOF MS/MS FIA-MRMS • Robust targeted and untargeted • Deep UPLC-QTOF detection of 10,000+ • High sample throughput: ~5 min cycle quantification of top 100+ metabolites annotations (
Slide 90: Establishing Avance IVDr NMR as standard
B) Precision Medicine & Phenomics International Phenome Establishing Avance IVDr Center Network (IPCN) & NMR as standard in • Global IPCN network of phenome centers, all standardized on Avance IVDr 600 MHz platform • Large-scale human metabolomics for biomarker discovery and validation • Coordinated
Slide 91: Four Major Mass Spec Metabolomics Initiatives
B) Precision Medicine & Phenomics Four Major Mass Spec Metabolomics Initiatives at ASMS 2019 and SpatialOMx Metabolomics 2019: 4D Metabolomics with focus on 4D Lipidomics FIA –MRMS for high-throughput Phenomics Phenomics ‘Workhorse’ QTOF impact II © Bruker Corporation 91
Slide 92: Next-Gen Phenomics by Integrated NMR and MS Insights
B) Precision Medicine & Phenomics “Such precise data will allow clinicians to better Next-Gen Phenomics by Integrated predict health problems and intervene earlier, saving time, money and lives. The potential of NMR and MS Insights this research to provide truly personalized care is remarkable.” Pro
Slide 93: Next-Generation Biobank Monitoring by NMR
B) Precision Medicine & Phenomics Next-Generation Biobank Establishing Avance IVDr NMR as de facto standard in biobanks Monitoring by NMR Medical research more effective with reliable biomaterials and harmonization of data • Quality management of biomaterials — identifies contaminations, robust quan
Slide 94: ASMS 2019 Innovations in Phenomics on timsTOF Pro
B) Precision Medicine & Phenomics ASMS 2019 Innovations in Phenomics on timsTOF Pro: 4D Lipidomics and Ultra-high Sensitivity Lipidomics Dr. Florian Meier et al., Max-Planck Institute of Biochemistry, Martinsried, Germany Routine workflows Low sample amounts 1µl 0.01µl 416 lipids identified (SRM 195
Slide 95: C) Next-gen 4D Proteomics
C) Next-gen 4D Proteomics Ushering in the Era of 4D Proteomics for translational research TIMSCCS Ultra-High Sensitivity Duty-Cycle Proven Speed Robustness Machine Learning Innovation Supported Discovery Lasting Impact 95 © Bruker Corporation
Slide 96: WEHI & The Royal Melbourne Hospital
C) Next-gen 4D Proteomics The Walter and Eliza Hall Institute & The Royal Melbourne Hospital “We have been completely blown away with how it can generate such deep analysis in such a short period of time. This, in combination with the robustness, is a true game changer for us, and it will fundamenta
Slide 97: University of Oxford & Nuffield Department of Medicine
C) Next-gen 4D Proteomics University of Oxford & Nuffield Department of Medicine, Medical Sciences Division ‘At 11.5 min run time and CCS-aware ‘match between runs’ software, the timsTOF Pro with Evosep is amazing for high throughput clinical samples with deeper proteomic depth!’ Dr. Roman Fischer,
Slide 98: Kyoto University
C) Next-gen 4D Proteomics Kyoto University & Our primary target is to do kinase activity assay with multiple drugs or different doses. Our fast-LC strategy could be the solution for this. High-throughput and targeted LCMS proteomics analysis will open the new applications, I believe. Dr. Yasushi Ish
Slide 99: CCS Aware Match Between Runs
C) Next-gen 4D Proteomics NEW: ‘CCS Aware’ Match Between Runs for DDA 4D Proteomics in Translational Proteomics >2x Prot. Quant. 7% in ID Replicates Courtesy Prof. J. Cox and Dr. Roman Fischer 208 plasma samples (11.5min runtime) © Bruker Corporation 99
Slide 100: Introducing diaPASEF
C) Next-gen 4D Proteomics New: Introducing diaPASEF Enabling Matthias Mann’s ‘rectangular strategy’ for 4D Proteomics Vision for translational proteomics with diaPASEF: Courtesy Prof. M. Mann & Dr. Florian Meier doi: https://doi.org/10.1101/656207 100 © Bruker Corporation
Slide 101: Next-gen 4D Proteomics: Market Expectations
C) Next-gen 4D Proteomics: Market Expectations Proteomics held back for last decade compared to NGS and RNA-Seq, due to slow, irreproducible tools and methods that have lacked robustness & sensitivity Research proteomics mass spectrometry market today ~$500M p.a. • Dominated by single vendor with es
Slide 102: D) Label-free Spatialomics
D) Label-free Spatialomics ASMS 2019: Introducing timsTOF fleX Uncompromised 4D Omics Performance Body fluids & In LC-TIMS-MS/MS Tissue & Cell culture Tumor Molecular Expression timsTOF fleX High Speed High Spatial Resolution MALDI Imaging 102 © Bruker Corporation
Slide 103: timsTOF fleX enabling MALDI-Guided SpatialOMx
D) Label-free Spatialomics timsTOF fleX enabling MALDI-Guided SpatialOMxTM: SpatialOMx is like a GPS to locate specific cellular sub- populations based on molecular expression of endogenous molecules such as glycans or lipids, …..and then use specific cells for deeper cross-omics analyses… © Bruker
Slide 104: MALDI-Guided SpatialOMx workflow
D) Label-free Spatialomics timsTOF fleX enabling MALDI-Guided SpatialOMxTM: Uncompromised MALDI Guided Laser Micro- 4D Omics Performance Dissection Glycans based mol. Exp. In LC-TIMS-MS/MS timsTOF fleX LCM Sections High Speed Questions from Histopath High Spatial Resolution MALDI Imaging © Bruker Co
Slide 105: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 105
Slide 106: 9) Bruker Corporation Medium-Term Financial Outlook
9) Bruker Corporation Medium-Term Financial Outlook Gerald Herman Chief Financial Officer © Bruker Corporation Innovation with Integrity
Slide 107: Full Year 2019 Guidance
Full Year 2019 Guidance Unchanged from May 2, 2019 2019 Guidance YOY Change Revenue $2.03B – $2.05B 7% – 8% Organic Revenue Growth 4.5% – 5.5% Non-GAAP Operating Margin 17.7% – 18.0% 90 bps – 120 bps Non-GAAP EPS $1.57 – $1.61 12% – 15% *2019 Guidance provided in Q1 2019 Earnings Presentation on May
Slide 108: Historical Growth
Historical Growth Solid Revenue Growth Driven Organically and by Acquisitions Revenue Growth By Geography By Business Group $2.04B BIOSPIN Group APAC $1.9B 29% 31% 30% NANO Group Europe 37% $1.8B $1.6B 4% 10% 30% Rest of World 29% BEST Group Americas CALID Group 2016A 2017A 2018A 2019G Drivers Marke
Slide 109: Medium-Term Growth Outlook
Medium-Term Growth Outlook Greater than Market Growth Driven by Project Accelerate and Strong Product Cycles Organic Revenue Growth Growth Assumptions: $2.4–$2.5B • LST & DX Market Growth of 3 - 5% $2.04B • Incremental M&A Not $1.6B Included 2016A 2019G 2022F Drivers Project Accelerate Key Product C
Slide 110: Project Accelerate Medium-Term Outlook
Project Accelerate Medium-Term Outlook Expanding Organic Revenue Growth Across the Initiatives Project Accelerate Est. Growth Initiative Rate After Market & Scientific Software HSD Key Product Accelerate Products 2019-2022 • timsTOF Pro & Flex Next-gen Nanotech & Semi Tools HSD-DD • GHz-class NMR •
Slide 111: Historical Profitability
Historical Profitability Operating Margin Expansion and EPS Growth Led by Mix and Operational Excellence Non-GAAP Operating Profit Margin Non-GAAP EPS (OPM) $1.59 17.85% 16.8% 15.9% $1.40 15.05% $1.19 $1.21 2016A 2017A 2018A 2019G 2016A 2017A 2018A 2019G Drivers Volume and Product Mix Operational Ex
Slide 112: Medium-Term Profitability Outlook
Medium-Term Profitability Outlook Continuing Operating Margin Expansion at 75-100 bps annually, on average Non-GAAP OPM Outlook Non-GAAP EPS Outlook Assumptions: • LST & DX Market 20.1%–20.8% $2.18–$2.42 Growth of 3 - 5% 17.85% • Incremental M&A not $1.59 Included 15.05% $1.19 2016A 2019G 2022F 2016
Slide 113: Free Cash Flow Improvement
Free Cash Flow Improvement Free Cash Flow $191M $111M $94M 2016A 2017A 2018A Summary • Recent improvements in Free Cash Flow generation • Continued focus on reducing working capital from 2019 to 2022 • Capital expenditures expected around 3% of revenue for period 2020 to 2022 A reconciliation non-GA
Slide 114: Capital Deployment Strategy
Capital Deployment Strategy Leading ROIC Performance 2016 – 2018: >20% Invest Maintain Return in Growing the Business Financial Flexibility Capital to Shareholders • R&D investments • Strong, flexible balance sheet • Annual dividend of $0.16 per • Market Development • Conservative debt levels share
Slide 115: R&D Investment
R&D Investment Focus on profitable organic growth driven by above-peer R&D Investment R&D Investment – to be maintained: Accelerating Revenue Growth 2016 – 2018 Average Percent of Revenue through Product Innovation 9% 6 – 7% Peers (1) Bruker MALDI Biotyper timsTOF GHz-class NMR Lattice light-sheet F
Slide 116: Medium-Term Outlook Summary
Medium-Term Outlook Summary Driving Shareholder Value 5-7% Organic Revenue CAGR 75-100 bps Non-GAAP OPM 11-15% Non-GAAP EPS CAGR Expansion Annually $2.4B–$2.5B 20.1%–20.8% $2.18–$2.42 $2.04B 17.85% $1.59 2019G 2022F 2019G 2022F 2019G 2022F Bruker Financial Outlook* • Higher than market organic reven
Slide 117: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 117
Slide 118: Key Takeaways and Wrap-up
Key Takeaways and Wrap-up Frank H. Laukien President & CEO Gerald Herman Chief Financial Officer © Bruker Corporation Innovation with Integrity
Slide 119: Questions and Answers
Questions and Answers Bruker Senior Management Team © Bruker Corporation Innovation with Integrity
Slide 120: Innovation with Integrity
Innovation with Integrity © Bruker Corporation 120
Slide 121: Appendix
Appendix © Bruker Corporation 121
Slide 122: Financial Medium-Term Outlook Model – Key Assumptions
Financial Medium-Term Outlook Model – Key Assumptions Assumptions: R&D Investment as a % of Revenue 9% per year Non-GAAP Effective Tax Rate Decreases from ~25% in 2019 guidance to ~23% by 2022 Interest / Other Expense Grows to 1.4% of revenue or 20 bps from 2019 to 2022 M&A Incremental M&A not inclu
Slide 123: Non-GAAP Financial Reconciliation of Forward-Looking Statements
Non-GAAP Financial Reconciliation of Forward-Looking Statements With respect to the Company’s guidance for 2019 and outlook for 2020 through 2022 non-GAAP organic revenue growth, non-GAAP operating margin, non-GAAP EPS and non-GAAP tax rate, and ROIC we are not providing the most directly comparable
Slide 124: Reconciliation of GAAP to Non-GAAP Financial Measures
Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited) (1)The Company adopted Accounting Standards Update (ASU) 2017-07 as of January 1, 2018 under the retrospective approach. Accordingly, the 2016 and 2017 income statement accounts have been restated to reflect ASU 201
Slide 125: Reconciliation of GAAP to Non-GAAP Financial Measures
Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited) (in millions, except per share amounts) Twelve Months Ended December 31, 2016 (1) 2017 (1) 2018 Reconciliation of GAAP and Non-GAAP Gross Profit GAAP Gross Profit $ 745.3 $ 816.0 $ 900.0 Non-GAAP Adjustments: Restru
Slide 126: Reconciliation of GAAP to Non-GAAP Financial Measures
Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited) (in millions, except per share amounts) Twelve Months Ended December 31, (1) (1) 2016 2017 2018 Reconciliation of GAAP and Non-GAAP Earnings Per Share (Diluted) GAAP Earnings Per Share (Diluted) $ 0.95 $ 0.49 $ 1.14
Slide 127: Reconciliation of GAAP to Non-GAAP Financial Measures
Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited) (in millions, except per share amounts) Twelve Months Ended December 31, (1) (1) 2016 2017 2018 Reconciliation of GAAP Operating Cash Flow and Non-GAAP Free Cash Flow GAAP Operating Cash Flow $ 130.8 $ 154.4 $ 239.7
Slide 128: Reconciliation of GAAP to Non-GAAP Financial Measures
Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited) (in millions, except per share amounts) Twelve Months Ended December 31, (1) (1) 2016 2017 2018 (2) Reconciliation of Impact of Adoption of ASU 2017-07 Cost of revenues (2.8) (3.0) (2.1) Selling, general and adminis