Microsemi — Investor Day (March 2015)
107 slides from Microsemi's investor day presentation, Mar 18, 2015
Slide 1: Welcome to Microsemi's Analyst Day
Welcome to Microsemi’s Analyst Day New York, NY March 18, 2015
Slide 2: Disclaimer
Disclaimer This presentation contains projections or other forward-looking statements regarding future events or the future financial performance of Microsemi Corporation. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We re
Slide 3: Introduction
Introduction Rob Adams VP Corporate Development
Slide 4: Today's Agenda
Today’s Agenda 9:05-9:15 Analyst Highlights Jim Peterson, Chairman & CEO 9:15-9:35 60/30: How do we get there? John Hohener, EVP & CFO 9:35-9:55 FPGA Growth and Opportunity Esam Elashmawi, Corporate VP & GM, SoC Product Group 9:55-10:15 Timing Growth and Opportunity Roger Holliday, Senior VP & Gener
Slide 5: Today's Agenda
Today’s Agenda 10:35-10:45 Aerospace Siobhan Dolan Clancy, VP, Worldwide Business Development, Aerospace 10:45-10:55 Space/Satellite Siobhan Dolan Clancy, VP, Worldwide Business Development, Aerospace 10:55-11:00 Acquisition Overview Steve Litchfield, EVP & Chief Strategy Officer 11:00-11:15 Executi
Slide 6: Investor Highlights
Investor Highlights James J. Peterson Chairman & CEO
Slide 7: Microsemi Shareholder Value Proposition
Microsemi Shareholder Value Proposition Maximizing Profitability Focus Products Driving SAM Expansion Increasing Strategic Customer Importance End Markets Built for Growth, Stability, Cash Flow Commitment to Deliver Shareholder Value
Slide 8: 60/30: How do we get there?
60/30: How do we get there? John Hohener EVP & CFO
Slide 9: Maximizing Profitability
Maximizing Profitability Historical P&L, Q2 Guidance FY14 FY15 Q1 Q2 Q3 Q4 Q1 Q2 Guidance Net Sales 255.6 287.0 292.3 303.3 303.6 Revenue $289.9—303.6 Gross Profit 143.1 158.3 163.7 171.0 170.5 Gross Margin 56.5%—56.7% Gross Margin 56.0% 55.2% 56.0% 56.4% 56.2% EPS 0.64—0.68 Operating Income 54.1 59
Slide 10: Maximizing Profitability: The 60/30 Model
Maximizing Profitability The 60/30 Model FY15 FY15 2016 Q1 Q2* 60/30 Net Sales 303.3 297 325 Gross Profit 170.5 168 195 Gross Margin 56.2% 56.6% 60% Operating 96.3 92.5 97.5 Expense Operating Income 74.2 75.5 97.5 Operating Margin 24.4% 25.4% 30% *FQ2:15 guidance numbers reflect midpoint of guided r
Slide 11: Gross Margins
Gross Margins A History of Improving Acquired Margins GM acquisition acquisition acquisition guidance
Slide 12: Maximizing Profitability: Gross Margins, Getting There
Maximizing Profitability Gross Margins, Getting There 60% 50% 2014 2015YTD 2016E Consolidations
Slide 13: Maximizing Profitability: Gross Margins, Getting There
Maximizing Profitability Gross Margins, Getting There 60% Consolidations 50% 2014 2015YTD 2016E Consolidations
Slide 14: Maximizing Profitability: Gross Margins, Getting There
Maximizing Profitability Gross Margins, Getting There 60% Mix Consolidations 50% 2014 2015YTD 2016E Consolidations, mix
Slide 15: Maximizing Profitability: Gross Margins, Getting There
Maximizing Profitability Gross Margins, Getting There 60% Absorption Mix Consolidations 50% 2014 2015YTD 2016E Consolidations, mix, absorption
Slide 16: Maximizing Profitability: Operating Margins
Maximizing Profitability Operating Margins Majority GM fall through – Infrastructure already in place Targeted R&D reductions, redeployment – Focus groups: FPGA, timing, MS/RF Ongoing back end transfer offshore Real estate consolidations Strategic customer focus
Slide 17: 60/30 Drives 25% Increase in Profitability
Maximizing Profitability 60/30 Drives 25% Increase in Profitability FY15 2016 2016 Status Q1 Quo 60/30 Net Sales 303.6 325 325 Gross Profit 170.5 182.7 195 Gross Margin 56.2% 56.2% 60% Operating 74.2 79.3 97.5 Income Operating 24.4% 24.4% 30% Margin 110 FQ1:15A Status Quo 100 60/30 95 90 85 80 75 70
Slide 18: Growing Cash Flow
Maximizing Profitability Growing Cash Flow Trends, % of Revenue 30% OCF % 25% FCF % 20% 15% 10% 5% 0% Q1:13 Q2:13 Q3:13 Q4:13 Q1:14 Q2:14 Q3:14 Q4:14 Q1:15 *As percent of revenue on fiscal quarter year to date basis
Slide 19: Credit Facility Metrics
Credit Facility Metrics TLB-1 5.00% 3.75% 5.75% 4.00% 3.75% 3.25% TLB-2 3.50% Credit facility balance was $849.6 million at the acquisition of Zarlink in Q1 2012. Credit facility balance was $698.0 million at Q1 2015 – TLB-1 $646.4M and TLB-2 of 51.6M. Term loan matures in February 2020 and moved to
Slide 20: Uses of Cash
Uses of Cash Shares Repurchased & Withheld Benefit to Cash Activity Shares Diluted Notes Amount Share Count Shares Repurchased $25.0M 1.0M 0.7M Shares repurchased in October and November at an average price of $24.08 Shares Withheld for Taxes $16.4M 0.7M 0.5M Q1 Total $41.4M 1.7M 1.2M Q2 Shares Repu
Slide 21: FPGA Growth and Opportunity
FPGA Growth and Opportunity Esam Elashmawi Corporate VP & General Manager
Slide 22: FPGA SAM Growth: Density + Systems Integration
FPGA SAM Growth: Density + Systems Integration Logic Density ASSP, MSoC $5B FPGA TAM (KLE) Upside FPGA Competition (28nm, 20nm) FPGA (16nm) 3000+ KLE ARM A-Class Processors Roadmap Higher Performance Multi-SoC Higher Density 4x A-53 $1.5B FPGA SAM 2x R5 Graphic Proc 150 KLE IGLOO2 / SmartFusion2 2.5
Slide 23: Rad Tolerant FPGAs: Extending our SAM to High-Speed Processing
Rad Tolerant FPGAs: Extending our SAM to High-Speed Processing Applications $100M SAM Logic Density (KLE) 150 KLE High Speed Processing $100M SAM for Pay Load Applications 20 KLE RTAX-S / DSP (Sampling CQ2’15) Command and Control Medium Speed Processing >110 LCP Customer/Partners >80 Customers with
Slide 24: Customers Engaged on Roadmap
Customers Engaged on Roadmap Communications Aerospace & Defense Industrial
Slide 25: FPGA SAM Growth: Density + Systems Integration
FPGA SAM Growth: Density + Systems Integration Logic Density $5B FPGA TAM ASSP, MSoC (KLE) Upside High-End FPGAs FPGA vs 3000+ KLE $3B FPGA SAM ASSPs & Multi-SoCs Microsemi Next-Gen FPGAs Extend our SAM Maintain & Grow Differentiation Microsemi Differentiation 150 KLE Everything from the Competition
Slide 26: MSCC's Growing FPGA SAM (>$3B)
MSCC’s Growing FPGA SAM (>$3B) B) ( $ Next-Gen Billions IGLOO in SmartFusion Dollars 2 1 IGLOO2 SmartFusion2 2012 2013 2014 2015 2016 2017 FPGA TAM MSCC FPGA SAM FPGA SAM Growth Through Differentiation – Lowest power – Security integration – Reliability/SEU – Single-chip FLASH Expanding Density and
Slide 27: Differentiated Mainstream FPGAs
Differentiated Mainstream FPGAs Low Power 1/10th static power Reduce total power by ~30-50% Security & Reliability SEU immune FPGA configuration Highly secure: suitable for anti-cloning and authentication applications Extended temperature support (125C Junction) Lowest Total Cost of Ownership System
Slide 28: Why are we displacing SRAM FPGAs
Why are we displacing SRAM FPGAs You get everything you need in a mainstream FPGA application with significantly lower power, unmatched security and reliability for the same or lower total cost of ownership about 1000 -Care 100 Customer 1 1995 2000 2005 2010 2015 2020 2025 Time
Slide 29: SmartFusion2 Consumes 34-53% Less Power
SmartFusion2 Consumes 34-53% Less Power Total Power Consumption SRAM Competitor 2 Static power 113% more power HPS SerDes Math Block SRAM Competitor 1 Memory 52% more power I/O Logic Clock (mW) SmartFusion2 consumes less power Power 2000 1500 Additional 35% Lower With 1V devices (58-70% less power)
Slide 30: Wireless Connectivity – Are You SECURE?
Wireless Connectivity – Are You SECURE? You must be secure from: – Trojan Horses (Stuxnet Worm) Safety risk – Tampering/Phishing Stolen passwords/keys – Hacking (Blackhat 2011) Smart/Connected Car Financial Investments Insulin pumps Point-of-sale terminals – Industrial Espionage (Energetic Bear) IP
Slide 31: Scalable Security Solutions and Services
Scalable Security Solutions and Services Scalable Military-Grade Security NIST-certified, root-of-trust secure hardware Hard IP for design and data security – DPA, PUF, SHA, … Single-chip FLASH FPGAs – most secure key verification Tunable for evolving threats in all markets & applications Ecosystem
Slide 32: The Most Reliable FPGAs in the Industry
The Most Reliable FPGAs in the Industry Alpha / • Flash FPGA Fabric Neutron – SEU immune zero FIT rate particles configuration strike routing matrix • Error Corrected Memories Embedded 32 Kbyte SRAM – (eSRAM) – Built-in DDR controllers – MSS CAN, USB, TSE HPMS/MSS memories Flash FPGA SRAM FPGA const
Slide 33: Most Reliable Solution: No Configuration Failures
Most Reliable Solution: No Configuration Failures FIT = number of errors in 109 hours – Acceptable FIT rates for high-reliability applications are < 20 Testing of Microsemi FPGAs, Xilinx and Altera 90nm, 130nm, and 150nm performed by IROC Technologies Xilinx 45nm, 40nm, and 28nm based on Xilinx reli
Slide 34: Many Reasons Why Customers Engage, Many Reasons Why We Win
Many Reasons Why Customers Engage, Many Reasons Why We Win Geography Market Segment Primary Reason for Secondary Reasons for Win Engagement Americas Communications (Router) SEU More PCIe More I/O Americas Communications (Secure Router) Security Small parts with mainstream features Small footprint Ch
Slide 35: SmartFusion2 / IGLOO2 Design Win Rate
SmartFusion2 / IGLOO2 Design Win Rate FY13-FY15 ($) Opportunities Design Ins Design Wins Grand Total $337,001,918 $92,682,687 $40,626,274 Cumulative Design Opportunities 2500 2000 1500 1000 500 0 Growing Opportunities – >2500 count – $337M in value >$90M of Design Ins – Customers have chosen MSCC ov
Slide 36: High Win Rate at New Customer Base
High Win Rate at New Customer Base for SmartFusion2 / IGLOO2 Design In + Design Win Values by Market $2,023,179 $8,053,307 Commercial Aviation $30,213,513 Communications $51,224,022 Defense Industrial Space/Satellite $41,685,748 42% of opportunities are with new customers – 3,785 total opportunities
Slide 37: Communications Design Win Examples
Communications Design Win Examples Application Secure Boot CPU of Networking Equipment SFP Modules for Network Monitoring Small Cell / Backhaul Equipment Why We Win Highly secure FPGA with builtin clone resistance and tamper resistance Lower TCO Only FPGA that can enable 1.5W module Most logic (90KL
Slide 38: Defense & Security Design Win Examples
Defense & Security Design Win Examples Application Secure Boot SRAM FPGA of RADAR/EW Systems Secure Communications Secure Embedded Systems Why We Win Highly secure FPGA with Root-of-Trust capabilities Customized Security at a Lower Cost Lowest Power baseband processing solutions Lowest Power & Most
Slide 39: Timing Growth and Opportunity
Timing Growth and Opportunity Roger Holliday & Maamoun Seido Senior VP & General VP & Business Unit Manager, Manager, Communications Timing and Optical Products Product Group
Slide 40: Bandwidth Demand Driving Infrastructure Upgrade
Bandwidth Demand Driving Infrastructure Upgrade Wireless Backhaul $8.8B Backhaul Equipment Market 2015 23% LTE cellsite deployment CAGR Data Center Interconnect $600M DCI Market 2015 40% DCI CAGR Carrier Ethernet and Routing $14B Carrier Ethernet and Routing Equipment 2015 22% 10/40/100G ports CAGR
Slide 41: Applications Driving the Demand for Bandwidth
Applications Driving the Demand for Bandwidth Over 1B unique visitors per month 4.9M daily •Over 4B videos active users viewed per 1.39B active day with 6B users per month hours of video with 1.19B Over 1B hours watched per mobile users watched per month month Over 57M 300M users subscribers in 2014
Slide 42: Microsemi's End-to-End Precise Time Solutions
Microsemi’s End-to-End Precise Time Solutions GrandMaster Systems Uses GPS to distribute “Precise Time” using the IEEE 1588 protocol Network Supervision & Management Timing problem notification, analysis and SLA compliance Packet Timing ICs Field proven high performance Time and Frequency Synchroniz
Slide 43: Microsemi Timing & Synchronization Leadership
Microsemi Timing & Synchronization Leadership Market Leaders in Timing Broadest Product Portfolio Thoroughly Field Proven Industry 1st SyncE/IEEE 1588 Industry 1st Optimized OTN Clock Management Trusted long-term supplier 25M+ PLLs sold, with double digit year on year growth Leading ITU-T, Telcordia
Slide 44: Bandwidth Demand Driving Infrastructure Upgrade
Bandwidth Demand Driving Infrastructure Upgrade Wireless Backhaul “Precise Time” in basestations avoid dropped calls Bandwidth shared using multiple frequency bands and cannot collide LTE employs TDMA requiring accurate time Data Center Interconnect Frequency precision enables WDM interconnections (
Slide 45: Developing Leading Products and Solutions
Developing Leading Products and Solutions Packet Timing Solutions: Delivers Time and Frequency Synchronization through Packet Networks for use by the Wireless Infrastructure OTN Timing Solutions: Highly integrated clock synchronizer that accept, filter & generate any client frequency rate for differ
Slide 46: Competitive Landscape
Competitive Landscape “Precise Time” Solution (IEEE 1588 & SyncE) Jitter Performance – Clocks Driving 100G links Flexibility & Programmability End-to-End Timing Solutions Clock Management Solutions
Slide 47: Success in Delivering Precise Time Solutions to Market Makers
Microsemi’s Success in Delivering Precise Time Solutions to Market Makers Wireless Backhaul Data Center Interconnect Carrier Ethernet and Routing Other Other Other Macrocell Mobile Backhaul Market Share12 OTN Hardware Market Share13 Worldwide SP Edge+Core+ CES Market Share14
Slide 48: "Precise Time" Emerging Market Opportunities
“Precise Time” Emerging Market Opportunities Industry Mobile and IP Phones Cable Automotive Financial Market Shift Wide adoption of mobile phones and IP-based landline phones lead to: —degrading 911 service —limiting location based services Deployment of de-centralized modular CMTS and remote PHY sy
Slide 49: "Precise Time" Emerging Market Opportunities
“Precise Time” Emerging Market Opportunities Industry Power Industrial Automation Broadcast Video Market Transition Transition to Ethernet/IP-based communications (SmartGrid) in substations and across wide area network Transition to Ethernet/IP-based communications, replacing legacy process buses on
Slide 50: Microsemi Timing
Microsemi Timing Timing expertise and execution has provided growth Established leader and footprint in the market continues to expand vs. limited competition End-to-End engagement offering “Precise Time” solutions drives innovation Continued emergent markets requiring “Precise Time” will fuel quali
Slide 51: Driving Growth in Key Applications: Small Cell/Backhaul
Driving Growth in Key Applications: Small Cell/Backhaul Maamoun Seido VP & Business Unit Manager, Timing and Optical Products
Slide 52: Small Cells – Integral to Future Deployments
Small Cells – Integral to Future Deployments The existing macrocell infrastructure is not easily scalable for future 4G/LTE deployments Small Cells offer a way to complement the macrocell architectures providing cost effective, heterogeneous solutions for high user locations Small cells are defined
Slide 53: Why Small Cells
Why Small Cells Data hungry applications are driving the bandwidth growth Mobile users of these applications are driving the need for densification of the wireless infrastructure Over 1Bn unique visitors per month 4.9M Daily 1.39Bn active Active Users6 Users per month with Over 1Bn 1.19Bn mobile hou
Slide 54: Growth of Small Cells & Backhaul
Growth of Small Cells & Backhaul Small Cells Outdoor (rural/urban) 46% Small Cells Indoor (enterprise) CAGR Femtocell (home and 37% enterprise) CAGR Small Cell Backhaul Equipment 125% CAGR References: 2014 Infonetics Research: Small Cell Equipment Market Share and Forecast, 2 nd Edition; September 2
Slide 55: Small Cells Design & Deployment Challenges
Small Cells Design & Deployment Challenges Issue Challenge Locations • Complete lack of normal facilities for equipment installations Unusual and inaccessible locations • Alternatives required for power and synchronization Power • Power efficient designs for fanless Limited or no conventional power
Slide 56: Microsemi Product Solutions
Microsemi Product Solutions Enterprise Urban IEEE1588 SW Rural Home Network Synchronization Equipment, ICs and SW Power-over-Ethernet Equipment and ICs Secure FPGA ICs Focused on specific small cell applications Home, enterprise, urban and rural www.microsemi.com
Slide 57: Microsemi Value Proposition
Microsemi Value Proposition Integrated Grandmaster (IGM) Indoor GPS with low cost of deployment Local 1588 GM IEEE 1588 SW & PLL Well-established solutions with +5M devices shipped Synchronization End-to-end Power over Ethernet Simple, low cost and efficient Security Secure solutions at the network
Slide 58: Timing Solutions Synchronize Small Cells
Timing Solutions Synchronize Small Cells Integrated Circuits Industry’s broadest range of synchronization technologies for small cells, including GPS, SyncE, 1588, NTP Leader in SyncE and 1588 deployments with established solutions Highest density, lowest jitter PLL IC solutions with RF phase noise
Slide 59: PoE Solutions Power Small Cells
PoE Solutions Power Small Cells Integrated Circuits Most efficient Ideal diode bridge saves up to 2.5W per small cell PD devices save up to 300mW Single port PSE to power backhaul systems End-to-end support up to 95W per port Systems Complete portfolio for indoor and outdoor products 1, 2 & 4 port o
Slide 60: FPGAs Provide Security for Small Cells
FPGAs Provide Security for Small Cells Baseband Processor PHY RF Security and Management Timing PoE Most secure, clone and tamper resistant – Provides the ability to verify the authenticity of remotely located small cells – Provides the ability to defend against attempts at network intrusions Lowest
Slide 61: Driving Growth in Key Applications: Residential Gateway
Driving Growth in Key Applications: Residential Gateway Roger Holliday Senior VP & General Manager, Communications Product Group
Slide 62: Broadband Gateway
Broadband Gateway 101 The Broadband Gateway – Deployed by operators to terminate a packet-based access network Twisted pair (VDSL and G.Fast) Cable (DOCSIS) Fiber (PON) Wireless (LTE) Operators use the gateway to offer and bundle services – Voice over IP – High speed internet access – OTT (Over The
Slide 63: Why Gateways?
Why Gateways? Broadband Subscriptions 1,000 747 782 816 847 800 707 144 167 191 217 Millions 600 123 117 120 122 124 126 PON 400 CABLE Subscribers 200 467 483 494 501 504 DSL 2014* 2015* 2016* 2017* 2018* Operators transitioning from TDM to packet-based infrastructure New features to drive new servi
Slide 64: The Race to One Gigabit Continues
The Race to One Gigabit Continues DSL—40Mbps Cable – 300Mbps Fiber – 1Gbps Healthy competition between Operators driven by… – Triple play deployments Video, data, voice – Connected home MoCA, HPNA, G.hn, Wi-Fi, BLE, Zigbee… – Multi-screen services Video capable gateways – Cloud-based services DVR, b
Slide 65: Broadband Gateway Technology Evolution
Broadband Gateway Technology Evolution Low Power WiFi PC Wireless 802.11 Zigbee, BLE USB Broadband Internet 4 x SoC Printer RJ-45 2-CH FXS Line RJ-11 Circuit Ethernet F Switch / LAN Home Network Router MoCA, HPNA, Homplug, G.HN Powered Wireline Ethernet www.microsemi.com
Slide 66: MSCC SAM in Broadband Gateways
MSCC SAM in Broadband Gateways MSCC Gateway SAM $500 Strong roadmap alignment and increasing content $455 $450 $400 $356 $350 $300 $250 $250 $188 $200 $162 $150 $100 $50 $0 2014 2015 2016 2017 2018 www.microsemi.com
Slide 67: MSCC Solutions for Broadband Gateways
MSCC Solutions for Broadband Gateways Voice: – Dominant market share leader – Demand upside across all geographies WiFi PA/LNA: – Strong offering in high power, high efficiency, high integration Line Drivers: – VDSL and G.Fast – PLC – HomePlug® AV2, G.HN Powered Wireline Ethernet (PoE): – Pioneer an
Slide 68: Solidifying Microsemi's Market Leadership
Solidifying Microsemi’s Market Leadership Microsemi provides world class broadband gateway solutions Strong engagement with leading gateway suppliers Delivering voice solutions today – Over 1 billion lines shipped High performance Wi-Fi and 802.11AC Providing line driver and power solutions for tomo
Slide 69: Microsemi RPF Reference Design Activities
Microsemi RPF Reference Design Activities Broadcom VDSL2 DPU DPU—8 ports power aggregation – PD70101 Power share Broadcom G.FAST DPU DPU – 16 ports power aggregation – PD70101 Power share Broadcom G.FAST CPE – RPF Daughter Card 1 line RPF PSE IC – PD81001 12V to 55V isolated boost – LX7309 Marvell G
Slide 70: Strong Partnership Program and Go To Market
Strong Partnership Program and Go To Market www.microsemi.com
Slide 71: Microsemi Gateway Leadership
Microsemi Gateway Leadership Growing market – New subscribers – Existing subscriber hardware replacement needs – Increasing silicon content Systems engineering brings substantial value to operators. Roadmap and trends provide strong growth for the second half of the year and beyond www.microsemi.com
Slide 72: Driving Growth in Key Applications: Aerospace
Driving Growth in Key Applications: Aerospace Siobhan Dolan Clancy VP, Worldwide Business Development, Aerospace
Slide 73: Commercial Aviation Market Dynamics
Commercial Aviation Market Dynamics Market Demand World traffic annual growth predicted at 4.7% (Airbus GMF 2014-2033) Demand for 30K + new aircraft by 2033 Single-aisle aircraft represents 70% demand in units Fuel efficiency will continue to drive profitability Technology Drivers for “More Electric
Slide 74: More Electric Aircraft Driving Content
More Electric Aircraft Driving Content Aircraft Electrical Power Conversion Systems $20 $18 $16 $14 Bn) $12 $ ( $10 Revenue $8 $6 $4 $2 $0 2014 2015 2016 2017 2018 2019 2020 Power Generation Power Distribution Auxillary Power Unit (APU) Actuation Systems www.microsemi.com
Slide 75: Electrical Power Conversion System Drivers
Electrical Power Conversion System Drivers Power Generation Power Distribution Actuation Technology Drivers Power optimisation Reliability, safety, cost Power quality and thermal control Eco friendly, zero emissions www.microsemi.com
Slide 76: Challenges Facing More Electric Actuation
Challenges Facing More Electric Actuation Economic Cost effectiveness Design to cost Standardisation Reliability Heritage Maturity Technology Optimized for weight State of the art technology www.microsemi.com
Slide 77: Actuation Power Drive Electronics System
Actuation Power Drive Electronics System Single Aisle Content by 2020 PCM SAM $100M CMM + SAM $100M Increasing SAM from 15% of the PDE today to 90% by 2020 www.microsemi.com
Slide 78: Capturing a Growing Percentage of Value
Capturing a Growing Percentage of Value Actuation System Power Drive Electronics Million 500 $ US 400 in 300 Revenue 200 2014 2015 2016 2017 2018 2019 2020 TAM SAM Single aisle adoption of electrical actuators driving TAM Microsemi growth initiatives driving SAM www.microsemi.com
Slide 79: Technology Leadership Driving Content
Technology Leadership Driving Content FPGA Integration, power, reliability and security SEU immune Motor control IP and development platform Power Discretes SiC technology, extended temperature range Broadest portfolio of TVS technology Higher Level Integration ASIC/SoC Power core modules (PCM) & su
Slide 80: Aircraft Electrical Power Conversion System Revenue Projections
Microsemi Aircraft Electrical Power Conversion System Revenue Projections Millions 50 $ US 40 in Revenues 20 2015 2016 2017 2018 2019 2020 Actuation Power Distribution Power Generation www.microsemi.com
Slide 81: Solid Engagements with Market Leaders
Solid Engagements with Market Leaders Airframers Electrical Power Actuation www.microsemi.com
Slide 82: Competitive Landscape
Competitive Landscape Industry Competitors FPGA Xilinx, Altera ASICs BAE, Raytheon, Aeroflex TVS Vishay, Sensitron Power devices, MOSFETs, IGBTs Infineon, IXYS, Rohm Modules Semelab, Powerex, Fuji Customers Make or Buy Decision Microsemi Differentiation Building “solutions” capability based on core
Slide 83: Summary
Summary Microsemi is well positioned to be a key partner for aircraft electric power conversion systems Key growth initiatives based on double digit growth applications Microsemi a “solutions partner” Impressive technology and capabilities roadmap from semiconductor material to packaging, integratio
Slide 84: Driving Growth in Key Applications: Space/Satellite
Driving Growth in Key Applications: Space/Satellite Siobhan Dolan Clancy VP, Worldwide Business Development, Aerospace
Slide 85: Continued Growth in Satellite Demand
Continued Growth in Satellite Demand Two Decades of World Demand For Satellite Manufacturing & Launch Services # of Satellites 2004-2013 2014-2023 Growth (Completed) (Most Likely) Rate Satellites launched and to be launched* 817 satellites 1,155 satellites +41% Total mass launched and to be launched
Slide 86: Capitalizing on Growth Drivers in Space
Capitalizing on Growth Drivers in Space Remote Sensing Growing requirements for imaging for commercial and government purposes ? Increasingly complex sensor data processing on board the spacecraft Commercial Satellites Redesigns of GEO communications platforms to support larger payloads and greater
Slide 87: Microsemi Technology Leader in Space
www.microsemi.com Microsemi Technology Leader in Space www.microsemi.com
Slide 88: Growing Space Market
Growing Space Market www.microsemi.com
Slide 89: Microsemi Increasing our Content
Microsemi Increasing our Content Bus / Platform Payload Solar Electronic Main Power Bus Payload Power Array Power System Conditioning Telemetry Receive Tracking & RF Repeater Antenna Control Payload (“Bent Pipe”) Command & Interface Data Unit Transmit Handling Antenna Digital Communications Star / S
Slide 90: Growth Initiatives Driving Content
Growth Initiatives Driving Content Introducing High Speed Processing Radiation Tolerant FPGA Best-in-Class FPGA for Space – Size, performance, power – Radiation effects – Microsemi heritage in space Targeting Remote Sensing Payload Applications – Sensor resolution increasing, downlink bandwidth not
Slide 91: Growth Initiatives Driving Content
Growth Initiatives Driving Content Radiation Tolerant Telemetry Controller IC Provides key functions for sensor monitoring, attitude and payload control Weight reduction, board space savings, reliability Interfaces with a radiation tolerant FPGA Precise Timing and Frequency Solutions Crystal oscilla
Slide 92: Microsemi Growing Revenue
Microsemi Growing Revenue Revenue Projection in Millions 2014 2015 2016 2017 2018 2019 2020 FPGA Mixed Signal ASIC Power Supplies Hybrids Discretes Other Frequency & Timing www.microsemi.com
Slide 93: Established Global Customer Base
Established Global Customer Base World Map of Main Communication Payload Suppliers Long-standing industry relationships Leveraging the breadth of our product technology Heritage built over half a decade www.microsemi.com
Slide 94: Competitive Environment
Competitive Environment Microsemi positioning to capture an increasing share of payload signal processing applications – Replacing ASICs, SRAM FPGAs Higher levels of integration for telemetry applications – Replacing inefficient and expensive discrete and hybrid solutions Positioning as a credible “
Slide 95: Providing Solutions for Growth Applications
Providing Solutions for Growth Applications Remote Sensing Payload Increasing SAM by $120M from 2016 www.microsemi.com
Slide 96: Providing Solutions for Growth Applications
Providing Solutions for Growth Applications Satellite Telemetry Tracking & Control System Increasing SAM by $50M from 2016 www.microsemi.com
Slide 97: Space Satellite Summary
Space Satellite Summary Leadership in space Leveraging our product breadth Innovative new product introductions Focused on growth applications www.microsemi.com
Slide 98: Acquisition Overview
Acquisition Overview Steve Litchfield EVP & Chief Strategy Officer
Slide 99: Strategic Rationale: Microsemi + Vitesse
Strategic Rationale: Microsemi + Vitesse Addition of Vitesse: – Furthers strategy of growing silicon content in existing applications – Further penetration at strategic customers – Adds unique differentiated technology with large barriers to entry – Broadens communication portfolio – Leadership in c
Slide 100: Transaction Overview
Transaction Overview Total consideration per share: $5.28, all cash transaction Commence cash tender offer. Microsemi shareholder approval is not needed. 3.2x debt/TTM adj. EBITDA at close; reduce to <2.5x ending FY16 Anticipate closing mid Q3FY2015 www.microsemi.com
Slide 101: Strategic and Financial Compelling Transaction
Strategic and Financial Compelling Transaction - Accelerates carrier Ethernet penetration and industrial IoT expansion - Extends communication portfolio into existing strategic customers - Complementary with timing portfolio further extends leadership - Unique technology portfolio with significant b
Slide 102: Executive Summary
Executive Summary Paul Pickle President & COO
Slide 103: Microsemi Shareholder Value Proposition
Microsemi Shareholder Value Proposition Maximizing Profitability www.microsemi.com
Slide 104: Focus Products Driving SAM Expansion
Focus Products Driving SAM Expansion Microsemi offers tailored feature sets for targeted applications www.microsemi.com
Slide 105: Increasing Strategic Customer Importance
Increasing Strategic Customer Importance www.microsemi.com
Slide 106: Microsemi Shareholder Value Proposition
Microsemi Shareholder Value Proposition Maximizing Profitability Focus Products Driving SAM Expansion Increasing Strategic Customer Importance End Markets Built for Growth, Stability, Cash Flow Commitment to Deliver Shareholder Value www.microsemi.com
Slide 107: Management Luncheon
Q&A Management Luncheon Power Matters