Slide 1: Investor Presentation March 2010
Investor PresentationMarch 2010 .... a leader in creating innovative engineered material solutions and services to make our customers competitive on a global basis... while enhancing earnings growth, shareholder value, and stability ... by broadening technology, market, and geographic reach Exhibit
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements These slides contain (and the accompanying oral discussion will contain) "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could
Slide 3: Brush Engineered Materials Inc. Profile
3 Brush Engineered Materials Inc. Profile A leading manufacturer of high performance advanced engineered materials and services ... an enabling materials technology companyFour segments ... with operations, service centers and major office locations in North America, Europe and AsiaServing long-term
Slide 4: Overview
4 Company: Brush Engineered Materials Inc. founded 1931, publicly traded since 1956NYSE Ticker: BWShares Outstanding: Approximately 20.2 million at 12/31/09Market Cap: Approximately $375 million at 12/31/09Component of: S&P Super Composite 1500, Russell 2000 S&P SmallCap 600, Russell 30002009 Revenu
Slide 5: BEM....the transformation
BEM....the transformation From Metals & Mining through Specialty Metals to Advanced MaterialsFrom an "old industrial" to a "new age technology" company 5
Slide 6: BEM....the transformation (cont'd)
BEM....the transformation (cont'd) Broaden the base...focused on > GDP opportunities new technologies new markets new products expanded geographyTarget fastest growing segments of fast growing marketsFirst Priority.....organic growthSecond Priority...."manageable" acquisitionsAll while building and
Slide 7: BEM....the transformation (cont.)
BEM....the transformation (cont.) Investments...prioritizing a targeted business modellow capital intensity...both working capital and reinvestment capital high IP....technology driven business non-commodity products...high margins good growth potential in >> GDP opportunitiesAcquisition goals Accre
Slide 8: BEM....the transformation (cont.) Performance Materials Advanced Materials
BEM....the transformation (cont.) 8 Performance Materials Advanced Materials
Slide 9: Targeted acquisitions increasingly important to total sales
Targeted acquisitions increasingly important to total sales 9 $ in millions
Slide 10: Acquisitions
Acquisitions Acquisitions 10
Slide 11: Barr Associates, Inc.
Barr Associates, Inc. Acquisition announced on October 23, 2009Based in Westford, Massachusetts with approximately 300 employees in three leased facilities in the Westford areaLeading manufacturer of precision thin film optical filters that enable complex technologies and components throughout the d
Slide 12: Academy Corporation
Academy Corporation Acquisition announced on January 5, 2010Based in Albuquerque, New Mexico with approximately 150 employees in four leased facilities in Albuquerque and Gallup, New MexicoLeading provider of precious and non-precious metals and refining services to customers in a number of technica
Slide 13: Brush Engineered Materials - Major Segments
13 Brush Engineered Materials - Major Segments Alloy Be Products TMI Other WAM East 0.24 0.07 0.05 0 0.64 West North Williams Advanced MaterialsPVD TargetsOptical CoatingsRefiningElectronic Packaging 64% Alloy (Cu based Be and Ni Alloys)Electronic ConnectorsIndustrial Components 24% Be ProductsDefen
Slide 14: 2009 Recap
14 2009 Recap Sales of $715 millionDiluted earnings per share of $(0.61)Acquisition of Barr Associates, Inc. for $55.2 millionBarr produces precision thin film optical filters that enable complex technologies and components throughout the defense, aerospace, medical, energy, semiconductor, telecommu
Slide 15: 2010 Outlook
15 2010 Outlook Order entry has continued to improve, especially in the consumer electronics-oriented and wireless infrastructure- oriented marketsRecently, we are seeing improvement in the medical, defense and industrial markets (oil and gas and aerospace)2010 sales are expected to improve 55%-65%;
Slide 16: Q1 2010 Outlook
Q1 2010 Outlook The level of overall business activity improved sequentially in 2009, quarter over quarter, as the year progressed. The improving trend has continued throughout the fourth quarter of 2009 and into the first quarter of 2010Q1 2010 sales are expected to be in the range of $275.0 millio
Slide 17: Strength in Challenging Times
Strength in Challenging Times Balance SheetRevolver$240 mm committed facility, matures November 2012DebtDebt to total capital of 16% Working Capital Turnover improved from 164 days in 2008 to 132 days in 2009 17
Slide 18: Global Leader in High Performance Engineered Materials
Global Leader in High Performance Engineered Materials 2009 Revenue by Market 18 Consumer32% Infrastructure21%
Slide 19: Brush Engineered Materials ... core competency
19 Brush Engineered Materials ... core competency Collaborating with customers worldwide to solve material application challenges ... with a focus on enabling technology and services"Own" a Niche orientation ... non-commodityFocus on global growth and serviceConstantly looking ahead to realign produ
Slide 20: Global Sales and Distribution Network
20 Global Sales and Distribution Network Operations in the U.S. and eleven foreign countries International sales are approximately 35% of the CompanyAct globally ... service locally! ?-------------- Asia / Pacific ------------? ? ---------------- Europe -------------- ? ? - Exports from USA -? Singa
Slide 21: Strong customer collaboration
21 Strong customer collaboration ... providing enabling technology solutions and serviceMaterials that meet design challenges requiring - Strength - Reliability - Electrical conductivity - Miniaturization - Weight reduction - Corrosion resistance - Reflectivity - Thermal conductivityTargeting profit
Slide 22: Typical End Uses
22 Typical End Uses Data Storage Industrial products for Oil & Gas and Mining MedicalDevices Cellular phones, i-Pods(tm) and other wireless communication devices Notebook computers and network servers Electronic components in cars and trucks CommercialAerospace Defense
Slide 23: Applications - Cell Phones
23 Applications - Cell Phones I/O Connector Contacts (Alloy): Brush 60/17410 Alloy 25/190/290 Battery Contacts (Alloy): Brush 60 Alloy 25/190/290 Internal Antenna Contacts (Alloy): Brush 60/17410 Alloy 25/190/290 Grounding Clips and Audio Jacks (Alloy): Brush 60 Alloy 25/190/290 Micro Mezzanine Conn
Slide 24: Applications - Photovoltaic (Solar)
Applications - Photovoltaic (Solar) Technology: Amorphous Silicon (a- Si, tandem and multi-junction) Thin Film (PVD) MaterialsSilicon based photovoltaic cellsFront and back contact layersTCO Transparent Conductive Oxide layers Technology: Cadmium Telluride (CdTe) Thin Film (PVD) MaterialsCadmium bas
Slide 25: Applications - Hard Disk Drives
25 Thin film materials for the read/write head. (WAM)Sputtering Targets/Evaporation Materials (Precious Metals, Alloys, Non-Precious Metals, Alloys, Magnetic Materials, Heusler Alloys and Oxides) Applications - Hard Disk Drives Example - Hard Disk Drive Media PMR Material Stack Disk Drive Arm (TMI)C
Slide 26: Applications - Oil & Gas
26 Applications - Oil & Gas Under Water Wellhead Equipment (Alloy): Brush Alloy 25 ToughMet(r) 3Blow out preventers, hydraulic actuators Directional Drilling Equipment (Alloy): Brush Alloy 25 ToughMet(r) 3MWD, LWD, MPT systems Drill Bits (Alloy): Brush Alloy 25 ToughMet(r) 3 Structural Rig Component
Slide 27: Applications - Aerospace
27 Applications - Aerospace Avionics/Electrical Systems (Alloy): Alloy 25 Airframe (Alloy): Alloy 25 Landing Gear Attachments (Alloy): Alloy 25ToughMet(r) 3 Engine and Pylon Attachments (Alloy): Alloy 25ToughMet(r) 3 Flight Control Mechanisms (Alloy): Alloy 25 ToughMet(r) 3 Horizontal Stabilizer & R
Slide 28: Applications - Medical
28 Applications - Medical Cardiac Rhythm Management (TMI): Electronic Interconnects/ComponentsNiobium/Titanium Electron Beam Weld Insulin Pump (Alloy): EMI Shielding Electrical Terminals in Connectors Mechanical Chips Connector Systems for equipotential grounding Seizure Control (WAM/TFT): Thin Film
Slide 29: Advanced Material Technologies and Services Business Structure
29 AMTSCorporate Thin Film Products Electronic Packaging Products Advanced Material Technologies and Services Business Structure Today and Evolving Thin Film Services Shield Cleaning Services Specialty Inorganic Materials Wheatfield, NYIrelandCzech Republic Brewster, NYBuffalo, NYAlbuquerque, NM Buf
Slide 30: Williams Advanced Materials capabilities
30 Williams Advanced Materials also has broad capabilities in precious and non-precious materials Comprehensive product lineHigh purity / proprietary PVD targetsMicro-electronic packaging materialsSpecialty inorganic chemicalsStrong end use marketsData storageWireless/handsetsSemiconductorOptical me
Slide 31: Key Markets - Wireless and Photonics
31 Key Markets - Wireless and Photonics Thin Film and Packaging materials for varied wireless and photonic applications including RF Power Amplifiers, HBT's, SAW Devices, Light Emitting Diodes (LEDs), Laser Recorders and Micro Electro Mechanical Systems (MEMS)
Slide 32: Key Markets - Semiconductor Wafer Fabrication
32 Key Markets - Semiconductor Wafer Fabrication Thin film materials and chamber services for silicon wafer and UBM (Under Bump Metallization) technologies. Numerous commercial and military microelectronic applications. Under bump metallization
Slide 33: Key Markets - Semiconductor Packaging
33 Key Markets - Semiconductor Packaging High reliability semiconductor packaging materials. Applications focused in space, military and satellite market segments. Solder preforms and clad materials
Slide 34: New Product and Technology Development - Advanced Material Technologies
34 New Product and Technology Development ADVANCED MATERIAL TECHNOLOGIES AND SERVICESMagnetic Media and Head Materials, Eco-Ru(tm) Sputter TargetsUnder Bump Metallization (UBM) for Flip ChipFCCL MaterialsOptics Coating MaterialsPrecision Optical Thin Film Coatings (specialty filters)High Value Optic
Slide 35: New Product and Technology Development - Specialty Engineered Alloys
35 New Product and Technology Development SPECIALTY ENGINEERED ALLOYSToughMet(r) Alloy for High Volume Bearing ApplicationsCupronickel alloy rod for offshore and marine seawater systemsAlloy 390E and Alloy 25BiQ High Performance Copper Beryllium Strip Alloy for Burn in and Test Sockets (BiTS) applic
Slide 36: Physical Vapor Deposition (PVD) Process
36 Physical Vapor Deposition (PVD) Process
Slide 37: World's only Fully Integrated Beryllium Producer
37 World's only Fully Integrated Beryllium Producer Bertrandite Ore Mining & Extraction Delta, UT Casting, Rolling & Finishing Elmore, OH Thin Gauge Rolling & Finishing Reading, PA Service & Distribution Centers Global Network New Beryllium Pebbles Plant underway with DoD Title III funding, targeted
Slide 38: Strip Alloy Applications
38 Strip Alloy Applications (strength, conductivity, spring characteristics ... typically 1% to 2% Beryllium) Current Carrying Springs and RelaysIntegrated Circuitry SocketsElectrical and Electronic ConnectorsAir Bag SensorsPressure Responsive DevicesFire Extinguisher Sprinkler HeadsEMI shieldingApp
Slide 39: Bulk Alloy Applications
39 Bulk Alloy Applications (strength, corrosion resistance, non-galling, conductivity ... typically 1% to 2% Beryllium) Aircraft BushingsHeavy Equipment Bearing and Wear ApplicationsOilfield well drilling, completion and production equipment Plastic Injection & Blow MoldsPower GenerationTooling for
Slide 40: ToughMet - a new unique solution
40 Toughmet(r) - a new unique solution for the most challenging wear and load conditions Oil & Gas...deeper drilling...tougher conditionsRotary steering drillsSour well drilling and completion toolsSub-sea control valvesBlow-out preventionsHeavy equipment ... larger equipment ... critical uptimeCrit
Slide 41: Beryllium Products - Applications
41 Beryllium Products - Applications (lightweight, strength, dimensional, stability...typically 40% to 100% Beryllium) - - Optical mirrors for NASA space-based telescopes- Infrared sensors for fighter jet optical targeting, radar and navigation/guidance systems and special ops (FLIR) -Structural and
Slide 42: Technical Materials, Inc. - engineered strip metals
42 Technical Materials, Inc. - solving customers' problems with engineered strip metals Mill ProductsSpecialty cladding and inlayElectron beam welding of dissimilar materialsProfiling shapes by milling and/or grindingClose tolerance rollingElectroplatingPrecious and non-precious metalsOverall and se
Slide 43: BEM - Execution Initiatives
43 BEM - Execution Initiatives Profitable organic growth through new products, new applications, and new servicesClose collaboration with customersExpansion of international base and salesBroaden markets and technologyLeverage above through "smart" acquisitionsNo let up in manufacturing excellence .
Slide 44: Annual Revenue
44 Annual Revenue Our diversification and value creation initiatives are leading to strong growth in revenue and profitability Growth % +24% -16% -21% +8% +24% +9% +41% +25% -5% -21% +55-65% Telecom Crash Expected Global Economic Recession Recent acquisitions 30%
Slide 45: Our ongoing value creation initiatives are focused in three key areas
45 Our ongoing value creation initiatives are focused in three key areas GrowthExpanding and diversifying the revenue baseTargeting profitable niche growth applications in growing marketsNew product innovation and serviceOngoing global expansionStrategic acquisitions, fast accretionMargin Improvemen
Slide 46: Strategic Highlights
46 Strategic Highlights The Company is well positioned; strong balance sheet and revolver capacity to operate in this severe economic environment and to take advantage of strategic opportunities as they ariseStrong, diverse set of markets servedGlobal market reachNew products and services ... a cult
Slide 47: Vision · Mission · Values
Vision · Mission · Values 47 VisionWe will be a leader in creating innovative engineered material solutions and services that make our customers competitive in global markets Mission ...in support of our vision:We bring value to our customers, globally, through innovative technology, service, and co