Slide 1: 3Q 2020 Presentation
3Q 2020 PRESENTATION RENESAS ELECTRONICS CORPORATION OCTOBER 29, 2020 © 2020 Renesas Electronics Corporation. All rights reserved.
Slide 2: 3Q 2020 Earnings Presentation
3Q 2020 EARNINGS PRESENTATION In this section, Renesas Electronics Group (hereinafter “the Group”) applies Non-GAAP financial measures (hereinafter “Non-GAAP basis”) used for management’s decision making. The Group defines the Non-GAAP consolidated financial results as financial accounting figures (
Slide 3: Disclaimer
DISCLAIMER Adoption of IFRS: With the outlook that the Group will continue to expand its business globally and to provide financial information that can be compared on a global scale, the Group discloses its consolidated financial statements in accordance with the International Financial Reporting
Slide 4: 3Q 2020 Financial Snapshot
Non-GAAP 3Q 2020 FINANCIAL SNAPSHOT IFRS, NON-GAAP *1*2 YoY and QoQ revenue as well as the changes from FCTs of the revenue are rounded off to one decimal place. 2019 2020 (B yen) 3Q 3Q Change 9 months Change 3Q 9 months 2Q (Jul-Sep) (Jul-Sep) YoY QoQ from (Jan-Sep) YoY from (Jul-Sep) (Jan-Sep) (Apr
Slide 5: Quarterly Revenue Trends
Non-GAAP QUARTERLY REVENUE TRENDS IFRS, NON-GAAP *1*2 Automotive Industrial/Infrastructure/IoT Others Revenue (B yen) 203.3 YoY: -2.6% 192.6 192.0 QoQ: +7.2% 200 185.6 5.3 187.7 183.4 179.9 4.6 4.2 178.7 178.7 4.4 5.2 4.4 166.7 5.3 2.6 2.5 2.5 Automotive 150.3 150 4.2 YoY: -14.6% 103.8 94.5 QoQ: +9.
Slide 6: 3Q 2020 Gross/Operating Margin
Non-GAAP 3Q 2020 GROSS/OPERATING MARGIN IFRS, NON-GAAP*1*2 Operating Margin vs FCST ＋5.9pts 2Q 2020 3Q 2020 3Q 2020 Actual Forecast Actual Gross Margin (Apr-Jun 2020) (Jul-Sep 2020) (Jul-Sep 2020) Currency Impact Product Mix Gross Margin Production Recovery vs FCST: +2.0pts 47.5％ 45.5％ 47.5% Product
Slide 7: Gross Margin, Operating Margin and Opex Trajectory
Non-GAAP GROSS MARGIN, OPERATING MARGIN AND OPEX TRAJECTORY IFRS, NON-GAAP *1*2 Before reclassification of expenses After reclassification of expenses YoY: +3.7pts YoY: -0.4pt Gross Margin (%) QoQ: +0.0pt R&D Ratio (%) QoQ: -1.1pts 50 20 19.7 17.2 17.4 17.6 17.5 18.1 17.0 46.0 44.8 45.0 45 18.5 47.3
Slide 8: Inventory
INVENTORY *1 In-house Inventory*2 (Settlement basis) Sales Channel Inventory*3 (Managerial basis) (B yen) (B yen) 150 150 100 100 Automotive Finished Goods 50 50 Industrial. Infrastructure, Work in Process IoT 0 0 18/3 18/6 18/9 18/12 19/3 19/6 19/9 19/12 20/3 20/6 20/9 18/3 18/6 18/9 18/12 19/3 19/
Slide 9: Quarterly Trends in Front-End Utilization Rate
QUARTERLY TRENDS IN FRONT-END UTILIZATION RATE WAFER INPUT BASIS Total 6-inch line 8-inch line 12-inch line 100% 80% 60% 40% 20% 0% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2017 2018 2019 2020 © 2020 Renesas Electronics Corporation. All rights reserved. Page 9
Slide 10: Non-GAAP EBITDA and GAAP Cash Flows
Non-GAAP (EBITDA) GAAP IFRS (Cash Flows) NON-GAAP*1 EBITDA*2*3 AND GAAP*4 CASH FLOWS Non-GAAP EBITDA GAAP Cash Flows EBITDA Cash flows from operating activities (B yen) (B yen) Cash flows from investing activities 79.2 EBITDA margin 70 50% 75 Free cash flows*5 67.1 64.9 61.2 60 57.1 56.0 57.6 57.3 6
Slide 11: Quarterly Revenue, Profit, and EBITDA Trends by Segment
Non-GAAP QUARTERLY REVENUE, PROFIT, AND EBITDA*1 TRENDS BY SEGMENT IFRS, NON-GAAP *2*3*4 Automotive Industrial, Infrastructure, IoT (B yen) Revenue EBITDA GM OM (B yen) Revenue EBITDA GM OM 120 70% 120 70% 103.8 102.0 100.8 60% 96.7 60% 100 94.5 93.1 100 94.3 93.5 93.6 93.5 91.6 90.4 90.8 50% 85.9 8
Slide 12: 4Q and Full Year 2020 Forecast
Non-GAAP 4Q AND FULL YEAR 2020 FORECAST IFRS, NON-GAAP *1*2 YoY and QoQ results of the revenue are rounded off to one decimal place. 2019 2020 (B yen) 4Q Full year 4Q Full year 3Q (Oct-Dec) YoY QoQ (Jan-Dec) YoY (Oct-Dec) (Jan-Dec) (Jul-Sep) Forecast Forecast 183.0 -4.7% +2.4% 707.1 -1.6% Revenue 19
Slide 13: Appendix
APPENDIX The figures in this section are mainly based on segment disclosure and GAAP (IFRS) stated on a financial reporting basis and are provided as additional information. © 2020 Renesas Electronics Corporation. All rights reserved. Page 13
Slide 14: Revenue and Operating Profit by Segment
Non-GAAP REVENUE AND OPERATING PROFIT BY SEGMENT NON-GAAP BASIS *1*2 2019 2020 (B yen) 1Q 2Q 3Q 9 months 4Q 1Q 2Q 3Q 9 months YoY QoQ YoY (Jan-Mar) (Apr-Jun) (Jul-Sep) (Jan-Sep) (Oct-Dec) (Jan-Mar) (Apr-Jun) (Jul-Sep) (Jan-Sep) Revenue 150.3 192.6 183.4 526.2 192.0 178.7 166.7 178.7 -2.6% +7.2% 524.
Slide 15: GAAP (IFRS) / Non-GAAP Reconciliation
GAAP (IFRS) / NON-GAAP RECONCILIATION Non-GAAP Basis: Non-GAAP figures are calculated by adjusting or removing non-recurring items and other adjustments from GAAP figures following a certain set of rules. The Group believe non-GAAP measures provide useful information in understanding and evaluatin
Slide 16: GAAP (IFRS) / Non-GAAP Reconciliation
GAAP (IFRS) / NON-GAAP*1 RECONCILIATION*2 2019 2020 (B yen) 1Q 2Q 3Q 4Q 1Q 2Q 3Q Operating Profit/Loss (GAAP/After PPA) -1.4 -10.9 8.1 10.4 13.3 17.3 17.2 Reconciliations in Gross Profit Level +1.9 +10.8 +0.9 -0.2 +2.2 +0.1 +0.5 PPA Effects*3 (Amortization of Intangible Assets: SG&A*4) +3.8 +14.2 +1
Slide 17: GAAP (IFRS) / Non-GAAP Reconciliation
GAAP (IFRS) / NON-GAAP*1 RECONCILIATION*2 2019 2020 (B yen) 1Q 2Q 3Q 4Q 1Q 2Q 3Q Profit/Loss attributable to owners of parent -1.9 -9.1 4.0 0.7 11.3 11.9 15.3 (GAAP/After PPA*3) Reconciliations in Operating Profit/Loss Level +8.5 +38.0 +18.8 +21.0 +20.4 +13.0 +19.2 Reconciliations in Net Profit/Loss
Slide 18: 3Q 2020 Financial Snapshot (GAAP)
GAAP 3Q 2020 FINANCIAL SNAPSHOT IFRS GAAP (IFRS) *1 YoY and QoQ results of the revenue are rounded off to one decimal place. 2019 2020 (B yen) 3Q 9 months 2Q 3Q 9 months YoY QoQ YoY (Jul-Sep) (Jan-Sep) (Apr-Jun) (Jul-Sep) (Jan-Sep) Revenue 183.4 526.2 166.7 178.7 -2.6% +7.2% 524.1 -0.4% Gross Margin
Slide 19: Statement of Financial Position
GAAP STATEMENT OF FINANCIAL POSITION IFRS GAAP(IFRS) *1 (B yen) 19/3 19/6 19/9 19/12 20/3 20/6 20/9 Total Assets 1,876.7 1,697.9 1,666.3 1,668.1 1,657.8 1,634.5 1,620.4 *2 Cash and Cash Equivalents 196.7 116.5 124.3 146.5 136.9 148.5 175.9 Inventories 129.7 100.8 95.5 90.8 95.7 101.8 96.9 Goodwill 6
Slide 20: Capital Expenditures
CAPITAL EXPENDITURES*1*2 (B yen) Capital Masks and Tools Sales Ratio 12.5 5.0% 4.4% 10.0 3.7% 4.0% 3.3% 3.5% 3.2% 8.0 3.2% 3.3% 7.6 2.9% 7.5 2.4% 2.6% 3.0% 6.1 2.5% 6.1 6.3 5.9 2.2% 5.3 4.9 4.6 5.0 2.0% 3.9 3.3 2.5 1.0% 0.0 0.0% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Forecast 2018 2019 2020 *1:The figu
Slide 21: Major Announcements from 3Q 2020
MAJOR ANNOUNCEMENTS FROM 3Q 2020 New Products and Solutions Selected Andes RISC-V 32-Bit CPU core as Renesas’ first RISC-V implementations of ASSPs Introduced JEDEC-compliant DDR5 data buffer 5DB0148 for high performance servers and data centers Strengthened active antenna system market leader
Slide 22: Renesas.com (Forward-Looking Statements)
Renesas.com (FORWARD-LOOKING STATEMENTS) The statements in this presentation with respect to the plans, strategies and forecasts of Renesas Electronics and its consolidated subsidiaries (collectively “we”) are forward-looking statements involving risks and uncertainties. Such forward- looking statem