Vat Group Ag · SIX:VACN
Vat — Q2 2024 Earnings Presentation
31 slides from Vat's earnings presentation, Jul 18, 2024
Slide 1: Second quarter and half-year 2024 results
WAT PASSION. PRECISION. PURITY. VAT - We change the world with vacuum solutions Second quarter and half-year 2024 results
Slide 2: Agenda
Agenda WAT Highlights Urs Gantner, CEO Second quarter and half-year 2024 financial review Fabian Chiozza, CFO Sustainability update 2024 Fabian Chiozza, CFO 2024 / 2025 market expectations and outlook Urs Gantner, CEO Q&A July 18, 2024 VAT - We change the world with vacuum solutions 2
Slide 3: Highlights
OT Highlights Urs Gantner, CEO
Slide 4: Working together in the semiconductor industry
Working together in the semiconductor industry WAT The industry is working together to solve four key challenges in order to grasp the opportunities of Al, mobility, and high-performance computing The semiconductor industry faces ... while dealing with external .. resulting in close collaboration cl
Slide 5: Orders considerably higher vs. 2023, with sales flat on previous year
Orders considerably higher vs. 2023, with sales flat on previous year Our business segments Delivering outstanding performance (Share of H1 2024 net sales) Valves (81%) Global Service (19%) 450 ay Y ee H1 2024 sales & 7 ; ' in M CHE (-1% vs. H1 2023) oe ¢ 26 48 ae : H1 2024 free cash flow Spec-wins
Slide 6: Highlights H1 2024
Highlights H1 2024 Cyclical recovery continues in semi, however inflection point for growth not reached yet Orders — recovery since Q2 2023 Sales — on track Profitability ERP - on track Ramp readiness and future growth Order intake up significantly vs. 2023 on overall more optimistic WFE forecast fo
Slide 7: Sales breakdown by markets and regions
Sales breakdown by markets and regions WAT Semiconductor end-markets remain core focus — sales to Asian customers remain strong Sales breakdown by market segment H1 2024 Regional sales breakdown H1 2024 ~80% of VAT’s ~28% of VAT’s Global Sevice sales are ewea sales originate 19% semiconductor 7% fro
Slide 8: Observed market trends 2024 YTD
Observed market trends 2024 YTD End-markets remain constrained, but good basis being established for 2025 ramp in semi Semiconductors Solar and energy transition Industry and scientific instruments Consumer/end-user market demand Memory: DRAM recovery underway, driven by HBM; NAND slowly recovering
Slide 9: Second quarter and half-year 2024 financial review
QO2 Second quarter and half-year 2024 financial review Fabian Chiozza, CFO
Slide 10: Group key figures H1 2024 compared to H1 2023
Group key figures H1 2024 compared to H1 2023 Net income CHF 94 million +12% Net sales CHF 450 million -1% Free cash flow CHF 26 million -29% EBITDA CHF 135 million (+2%) EBITDA margin 30.1% (+0.9ppt) Leverage (Net debt/LTM EBITDA) 0.8x
Slide 11: Order intake
Order intake WAT Q2 2024 orders up 75% y-o-y and H1 2024 orders up 74% up y-o-y as recovery accelerates (in CHF million) 507 292 6M order backlog +2% y-o-y 6M order intake +74% y-0-y 155 Q2 order intake +75% y-0-y 6M 2023 6M 2024 @ Q2 order intake W Half-year order intake @ Order backlog ee July 18,
Slide 12: Orders and sales through the cycle
Orders and sales through the cycle WAT Order momentum rebounded since Q1 2023 with book-to-bill remaining above 1.0x since Q3 2023 (in CHF million) 500 18x 450 16x 400 14x 350 12x 300 1.0x 250 08x 200 150 0.6x | order intake - -po ee Oe ee ee Ge oe ee eee Oe ee ee eee eee trough 2019 100 0.4% | leve
Slide 13: EBITDA and EBITDA-margin
EBITDA and EBITDA-margin WAT Despite flat sales, EBITDA margin increased year-on-year (in CHF million) Sales -0.9% 454 450 EBITDA margi 6M 2023 6M 2024 ™ Q2 net sales @H1net sales MHIEBITDA * FX movements (mainly USD/CHF) had a negative impact on 6M 2024 sales of about 4% ee July 18,2024 VAT - We ch
Slide 14: EBITDA margin
EBITDA margin VAT EBITDA margin below bottom end of margin band; operating leverage yet to kick-in Net sales (in CHF million) 700 40% 600 EBITDA 35% | margin band (32-37%) 500 400 300 20 hl (tkirhlCUAYA_ Sa Ce. Le. e..LUOULe ee Oe SCOUT 100 20% H12018 =H22018 = H12019.--H22019 = H12020. -H22020) =-H
Slide 15: Value creation
Value creation Despite sector downturn, VAT’s business model generates consistently high returns (in CHF million) 700 600 500 400 300 WAT - Leta te 2015 2016 2017 2018 2019 2020 lll Invested capital CHF M WE NOPAT (LTM) CHF M ll Free cash flow (LTM) CHF M * The return on invested capital (ROIC) and
Slide 16: Below the EBIT line
Below the EBIT line VAT Lower EBITDA, higher finance costs yield in lower net income Gn CHE ion om 2024 6m 2023 135.3 132.4 +2.2% reciation, amortizatio -21.5 -20.7 +3,9% 113.8 7 +19% Net come 94.0 84.2 +11.6% * Net finance results reflects FX related revaluation of bank loans and bank balances as w
Slide 17: Free cash flow
Free cash flow WAT Free cash flow lower as expected on slightly lower operating cash flow coupled with high capex Free cash flow development (in CHF million) 67 66 | 7 26 Free cash flow conversion (%) 100% 88% 70% Average free cash flow conversion of 65% 6M 2024 I Cash flow from investing activities
Slide 18: Net debt
Net debt WAT Net debt and leverage increased due to dividend payment - VAT retains conservative balance sheet Net debt development Leverage development (CHFm) 19 347 319 231 198 -116 “2 oe 7s 88 03 01 6M 2023 6M 2024 6M'5 6M'G6 =6M'I7, ~6M'8 6M'19_ 6M'20 6M'21 6M'22) 6M'23 6M'24 MM Gross debt Mil Ca
Slide 19: Finance summary
Finance summary WAT Business and FX environment remains challenging, but on course to achieve mid-term guidance ° VAT weathered the worst of the downturn during 2023 and has seen a marked improvement in the business conditions in H1 2024 * Semiconductor orders are improving, driving operating levera
Slide 20: ESG update
O03 ESG update Fabian Chiozza, CFO
Slide 21: VAT Sustainability Report 2023
VAT Sustainability Report 2023 WAT Overview of changes compared to the 2022 report and ESG highlights of 2023 edition Improvements compared to the 2022 report CREATING VALUE SUSTAINABLY Y Incorporating additional information as requested by ESG ratings Y Implementation of the Swiss KVI requirements
Slide 22: 2024 market expectations and outlook
O4 2024 market expectations and outlook Urs Gantner, CEO
Slide 23: Short term market outlook
Short term market outlook H2 2024 - preparing for 2025 ramp WAT H2 2024 expected market growth VAT H2 2024 expectations * Demand from China, especially related to ICAPS, expected to remain at high levels but unlikely to grow further * Investments continue to grow due to demand for high-end memory an
Slide 24: 2024/2025 forecasts firming up
2024/2025 forecasts firming up WAT WFE estimates show a wide range — but the direction of travel is up 16% 133 120 103 2026 2027 —®Growth y-o-y % 2025 lll WFE Consensus ‘Source: Techinsights, Yole, SEMl.org, Banks. Key drivers r Leading edge logic - Al driving demand for high-end computing power at
Slide 25: Mid-term pathway to capacity build-out
Mid-term pathway to capacity build-out WAT ~100 fabs are coming online in the next 2 to 3 years - to achieve USD 1 trillion semi market by 2030 Fab status: 79 - in progress 22 -in operation 14 - equipping 43- under construction 24 - planned 7 ‘Source: Semiorg (March 2024) ~ ee July 18,2024 VAT - We
Slide 26: R&D remains VAT's differentiator
R&D remains VAT’s differentiator VAT’s focus and leadership on vacuum technology demonstrated by our spec-win rate H1 2024 spec-wins continue at high level 120, 5-year average: 2019 2020 2021 2022 12023 2023 * Spec-wins have increased 17% y-o-y vs. H1 2023 * 2/8rds of all spec-wins in semi applicati
Slide 27: Qualitative FY outlook and guidance for Q3 2024
Qualitative FY outlook and guidance for Q3 2024 WAT H2 order flow and sales to grind higher - sequentially and continuously growing Q3 2024 guidance At constant foreign exchange rates. Investment conditions for Semiconductor segment expected to grind higher over H2 2024, similar to the run-rate for
Slide 28: Q&A
OS Q&A Second quarter and half-year 2024 results
Slide 29: Additional information
Additional information VAT Investor information Contact information Listing: SIX Swiss Exchange Michel Gerber Christopher Wickli Currency: CHF VP Investor Relations & Investor Relations Ticker symbol VACN Sustainability Manager ISIN CH 031 186490 1 Phone: +41 81553 70 13 Phone: +41 81553 75 39 E-mai
Slide 30: Forward looking statements
Second quarter and half-year 2024 results WAT Forward looking statements Forward-looking statements contained herein are qualified in their entirety as there are certain factors that could cause results to differ materially from those anticipated. Any statements contained herein that are not stateme
Slide 31: Thank you!
Thank you! VAT Group AG Investor Relations investors@vat.ch WAT PASSION. PRECISION. PURITY.