Slide 1: Siltronic – a leading producer of silicon wafers
Siltronic – a leading producer of silicon wafers Full Year Results 2015 © Siltronic AG 2016
Slide 2: Highlights 2015: Financials
Highlights 2015: Financials Sales of 931.3 mn EUR (2014: adjusted1 853.4 mn EUR) Sales Growth of 9.1% 124.0 mn EUR (2014: adjusted1 117.7 mn EUR), EBITDA Without negative FX effects2 EBITDA would have been 169.7 mn EUR EBITDA margin of 13.3% (2014: adjusted1 13.8%) Margin Without negative FX effects
Slide 3: Agenda
Agenda Market Overview Financials Outlook Appendix ( 3 © Siltronic AG 2016 3 of 31
Slide 4: What happened in 2015? - GDP growth slowed, electronics revenue went down
What happened in 2015? - GDP growth slowed, electronics revenue went down, and semiconductor revenue stayed flat. Worldwide GDP grew 3.1% in 2015 (0.3% pts. less than in 2014), according to IMF Electronic revenue Electronics revenue was USD 1,423 bn in 2015 (2.1% down from 2014), according to IC
Slide 5: Silicon area demand continues to grow
Silicon area demand continues to grow Silicon wafer demand, in bn in2 3% 3% 10.7e 10.1 10.4 9.4 9.0 9.0 9.1 2010 2011 2012 2013 2014 2015 2016 Source: SEMI SMG Silicon Area until 2015, IHS Semiconductor Silicon Demand Forecast Tool Q1 2016 (growth rates from 2016 onwards) 5 © Siltronic AG 2016 5 of
Slide 6: Agenda
Agenda Market Overview Financials Outlook Appendix ( 6 © Siltronic AG 2016 6 of 31
Slide 7: Financials improved strongly
Financials improved strongly Adjusted1 financial figures (EUR mn) 2015 2014 2013 2012 Sales 931.3 853.4 875.5 1030.0 EBIT 2.7 (31.6) (87.3) (75.5) EBIT margin in % 0.3 (3.7) (10.0) (7.3) EBITDA 124.0 117.7 112.6 122.5 EBITDA margin in % 13.3 13.8 12.9 11.9 CapEx (75.0) (40.7) (39.7) (144.3) Free cas
Slide 8: Sales development driven by higher wafer volumes and strong USD
Sales development driven by higher wafer volumes and strong USD Adjusted1 sales, in EUR mn +9.1% Comments 931.3 853.4 238.7 246.7 Volumes FY 2015 up y-o-y 230.6 223.2 Volumes Q4 decreased y- 216.0 215.3 203.81 210.4 o-y as well as compared to previous quarters Prices decreased q-o-q in contrac
Slide 9: EBITDA 2015 increased by 5%
EBITDA 2015 increased by 5% Adjusted1 EBITDA, in EUR mn +5.4% 124.0 Comments 117.7 17.6% Positive 16.8% • volume growth 15.4% • cost reduction 13.4% 12.7% • strong USD 12.7% Negative 10.8% • ASP decline 8.4% • hedging losses2 39.2 40.1 33.2 31.4 28.2 29.3 23.2 17.1 Q1 2014 Q2 2014 Q3 2014 Q4 201
Slide 10: EBITDA excluding FX and hedging improved by >50%
EBITDA excluding FX and hedging improved by >50% Adjusted1 EBITDA excl. +53.7% 169.7 FX effects2,in EUR mn 110.4 19.9% 19.4% Comments 17.7% 17.7% FX effects due to hedging 15.7% • positive EUR 7.3 mn in 2014 12.9% • negative EUR 45.7 mn 11.8% in 2015 9.0% 49.0 44.8 42.2 39.4 33.7 27.9 24.8 18.3 Q1
Slide 11: USD sales significantly higher than USD/SGD costs
USD sales significantly higher than USD/SGD costs Currency mix at Siltronic revenue cash costs USD exposure equaled around EUR 330 mn p.a. approx. 50% hedged using forwards and options correlated USD JPY EUR USD SGD JPY EUR © Siltronic AG 2016 11 of 31
Slide 12: Equity ratio of 48% and strong net cash position of EUR 156 mn
Equity ratio of 48% and strong net cash position of EUR 156 mn Balance sheet, in EUR mn Equity and Assets Dec 31, 2015 Comments Dec 31, 2015 Comments liabilities Non-current 579.1 Equity 497.3 PP&E 542.9 Siltronic 500.5 30 intangible (related Other Other fixed 36.2 -3.2 Samsung’s 22% in SSW to SSW)
Slide 13: Capital discipline supports positive free cash flow
Capital discipline supports positive free cash flow Cash flow, in EUR mn Comments 2014 2015 20141 • Prepayments of EUR 56 mn received Cash flow from operating activities 96.1 123.7 2015 Payments for CapEx (58.7) (37.4) • Repayment of around EUR 21 mn of prepayments Free cash flow 37.4 86.3 • clo
Slide 14: Pension provision decreased considerably
Pension provision decreased considerably Pension provision, in EUR mn 429 Comments decrease in Q2/2015 due 328 299 to changes in interest 292 294 rates stable since that time 185 changes shown in equity 2013 2014 Q1 2015 Q2 Q3 Q4 interest rates IFRS USA 4.8% 3.8% 3.6% 4.3% 4.2% 4.2% currentl
Slide 15: CapEx: spending mostly for capability and cost reductions
CapEx: spending mostly for capability and cost reductions Adjusted1 CapEx and D&A, in EUR mn CapEx focus on Capability improvement • New design rules 34.8 2.5 • New generation crystal pullers Cost reduction (e.g. 8.9 automation) Debottlenecking 198.0 199.9 149.3 No extensions planned 144.3 121
Slide 16: Siltronic continued successful track record of cost reduction
Siltronic continued successful track record of cost reduction Cost reduction, in EUR mn1 Additional Savings Levers: Additional Site closures Cost reduction roadmap defined savings Operational excellence for 2016 and beyond from SSW Investing in automation in ~80 Germany up to 500 employees to
Slide 17: Agenda
Agenda Market Overview Financials Outlook Appendix ( 17 © Siltronic AG 2016 17 of 31
Slide 18: 2016 expected to bring slightly better GDP growth, moderate growth for electronics
2016 is expected to bring slightly better GDP growth, driving moderate growth outlook for electronics and semiconductors. Worldwide GDP IMF is projecting 3.4% growth in 2016 (0.3% pts higher than in 2015) The importance of the Chinese economy will grow for consumer markets like personal computer
Slide 19: IHS expects silicon area demand to grow 3.3% in 2016
IHS expects silicon area demand to grow 3.3% in 2016. Main drivers are SSDs, industrial sector and automotive Wafer demand for key applications 2015, in bn in2 Estimated growth 2015/16, in % Smartphones -1% Desktop, Notebooks & Server PCs -1% Industrial +7% Automotive +8% Appliances, Video Players e
Slide 20: Silicon demand for Automotive is outgrowing the semiconductor market
Silicon demand for Automotive is outgrowing the semiconductor market, with the highest growth for 300 mm wafers. Wafer demand for automotive applications 2018 CAGR +5.3% 2014 CAGR +5.7% 2010 SD 200 mm 300 mm Silicon area consumption in the automotive sector is outgrowing the market. 300 mm
Slide 21: Industrial and automotive with higher growth rates than computing and mobile
Industrial and automotive with higher growth rates in next years compared to computing and mobile Silicon demand for main wafer consuming applications CAGR +3% +2% +7% +7% -1% +4% 2012 2015 2018 Computing Mobile Phones Industrial Automotive Others Source: IHS, Q1-2016; © Siltronic AG 2016 21 of 31
Slide 22: Silicon industry will experience challenges and opportunities in 2016
Silicon industry will experience challenges and opportunities in 2016 Inventory adjustments which occurred in 2nd half of 2015 in the value chain seem to be done Usual post-Chinese New Year increase in market activities has not happened yet Some economic uncertainties due to recent market rumo
Slide 23: Siltronic will continue to focus on topics under its control
Siltronic will continue to focus on topics under its control Stay ahead of the markets in technology development Ongoing strengthening of cost position Further improve manufacturing and logistics excellence Further strengthening customer service and support © Siltronic AG 2016 23 of 31
Slide 24: Siltronic Outlook 2016
Siltronic Outlook 2016 EBITDA margin slight improvement ROCE in the mid single-digit percentage range Free Cash Flow clearly positive, but below the 2015 figure Sales slight year-on-year decrease R&D unchanged at approx. 7% of sales Cost Position potential savings of around EUR 30-35 mn Hedging Loss
Slide 25: Appendix
Appendix ( 25 © Siltronic AG 2016 25 of 31
Slide 26: Strong #3 Wafer Supplier
Strong #3 Wafer Supplier Market Share by Wafer Revenues (Top 5 Suppliers only), USD basis 100% 90% 80% 70% stable market No.3 60% position 50% 40% 30% 16% 16% 16% 15% 20% 10% stable market 0% ~16% 2012 2013 2014 2015 share Sources: Companies’ revenue reports until Q3 2015, converted to USD using ann
Slide 27: Shareholder structure
Shareholder structure Freefloat by regions1 100 42.2 11% 20% 53% 57.8 16% USA UK Germany Rest of World Major shareholdings included in freefloat2 Baupost Securities Group 8.7% MainFirst Sicav 5.1% Wellington Management Co. 2.8% pre-IPO post IPO Morgan Stanley 1.8% Wacker Chemie Free Float 1 as at Ja
Slide 28: Siltronic Strategy: Improving returns and stay ahead in technology
Siltronic Strategy: Improving returns and stay ahead in technology Strategic Focus Our Actions Drive 300 mm and 200 mm utilization Benefit From Broaden market access Market Growth Improve product mix Cost Drive automation and optimization of polysilicon supply & usage Reduction Selectively
Slide 29: Investment Highlights – Siltronic Strengths
Investment Highlights – Siltronic Strengths 1 Strong market position in semiconductor silicon wafer manufacturing 2 Technology and quality leader Supplier to all top 20 silicon wafer consumers with 3 well-established relationships 4 Strong track record in efficiency improvement and cost reduction 5
Slide 30: Contact and Additional Information
Contact and Additional Information Issuer and Contact Additional Information Siltronic AG ISIN: DE000WAF3001 Hanns-Seidel-Platz 4 WKN: WAF300 D-81737 München Deutsche Börse: WAF Listing: Frankfurt Stock Exchange Investor Relations: Prime Standard Petra Mueller Tel. +49 89 8564-3133 Financial Calenda
Slide 31: Disclaimer
Disclaimer The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements contained in this presentation may be statements of future expectations and other forward-looking statements that are based on management's