Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Q3 2023 Earnings Presentation
28 slides from Be Semiconductor Industries's earnings presentation, Oct 26, 2023
Slide 1: Investor Presentation Q3-23 Results
INVESTOR PRESENTATION Q3-23 RESULTS October 26, 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements about management's future expectations, plans and prospects of our business that constitute forward-looking statements, which are found in various places throughout the presentation, including, but not limited to, statements relating to exp
Slide 3: Table of Contents
Table of Contents I. Key Highlights II. Market & Strategy III. Outlook IV. Financial Appendix October 26, 2023 3
Slide 4: I. Key Highlights
I. KEY HIGHLIGHTS October 26, 2023 4
Slide 5: Q3-23 Revenue and Operating Profit Above Mid-point of Guidance
Q3-23 Revenue and Operating Profit Above Mid-point of Guidance Orders Up 13.1% Sequentially Due to Advanced Computing Applications Guidance € millions Q3-23* Q3-23 ∆ Q2-23 ∆ Q3-22 Revenue Down 20%-30% 123.3 - 24.1% - 27.0% Orders 127.3 + 13.1% + 1.6% Gross Margin 62%-64% 64.6% - 1.0pts + 2.3pts Opex
Slide 6: YTD-23 Results Reflect Challenging Market, Particularly for Computing
YTD-23 Results Reflect Challenging Market, Particularly for Computing Applications. However, Profit Level Remains Elevated Q2-23/Q3-23 YTD-22/YTD-23 Revenue Net Income Revenue Net Income 200 600 € 585.1 - 28.4% € 162.5 - 24.1% 500 160 € 419.2 Gross Margin € 123.3 Gross Margin 65.6% - 1.0 points 64.6
Slide 7: Besi Continues Significant Outperformance vs. Last Industry Downturn
Besi Continues Significant Outperformance vs. Last Industry Downturn Revenue (€MM) Orders (€MM) 1,000 1,000 939 900 900 800 749 800 681 700 700 593 600 557 600 562 500 500 400 356 400 331 300 300 200 200 100 100 0 - 2017 LTM Q3-19 2021 LTM Q3-23 2017 LTM Q3-19 2021 LTM Q3-23 Operating Profit (€MM) O
Slide 8: 2023 Capital Allocation Exceeds Prior Year Levels
2023 Capital Allocation Exceeds Prior Year Levels. €1.8 Billion Distributed Since 2011 500 € 1.8 Billion Distributions Since 2011* 416.3 412.4 400 Dividends • € 412 million distributed YTD-23 Share Repurchases 146.8 190.3 300 • € 300 million share buyback program: € millions • ~4.1 million shares pu
Slide 9: Strong Liquidity Position Maintained
Strong Liquidity Position Maintained 800 Q3-23 vs. Q2-23 Cash and Deposits Net Cash • Cash and deposits of € 391.2 million 700 672.2 671.7 • +€ 12.9 million, or 3.4% vs. Q2-23 due to: 644.9 • + € 65.1 million cash flow from operations 598.7 • - € 45.5 million capital allocation 600 • - € 4.7 million
Slide 10: II. Market & Strategy
II. MARKET & STRATEGY October 26, 2023 10
Slide 11: New Industry Upturn Forming Post Q2-23 Trough
New Industry Upturn Forming Post Q2-23 Trough TechInsights Global Chip Making Climate Trend Index 120 7/22: Memory Inventory 110 Correction 2/21: Intel, TSMC, Samsung hike capex 100 Temperature in Degrees F 90 2/20: COVID-19 80 outbreak 70 Growth Decline Line 60 5/19: U.S.- China trade war escalates
Slide 12: Assembly Market Rebound Forecast 2024-2025
Assembly Market Rebound Forecast 2024-2025 8.0 68.5% 80% Market Size YoY Growth Rate 7.1 7.0 6.6 6.5 5.5 60% 6.0 5.4 40% US$ billions 5.0 4.3 3.9 24.3% 4.0 3.2 20.0% 20% 22.5% 9.0% TechInsights forecasts 21.4% downturn 3.0 0% in 2023 2.0 • Versus -23.4% last forecast -16.2% -21.4% -20% 1.0 -29.7% •
Slide 13: Strategy Update
Strategy Update • Effectively navigating industry downturn at high profitability levels Business • Overhead aligned with market conditions • • LTM revenue and operating profit up 56.5% and 115.4% versus 2019 trough Signs of industry improvement appearing • Prepared for next industry upturn with wafe
Slide 14: III. Outlook
III. OUTLOOK October 26, 2023 14
Slide 15: Guidance Q4 and FY 2023
Guidance Q4 and FY 2023 € in millions Q3-23 Q4-23 FY 2023E* vs. FY 2022 +25% Revenue € 123.3 - € 567.2 -22% +15% 64.6% 62% - 64% 64.4% +3.1 Gross Margin pts Operating Expenses € 36.9 +~5% € 163.4 +10% * Assumes midpoint of guidance for Q4-23 October 26, 2023 15
Slide 16: Financial Calendar
Financial Calendar 6-Nov-23 Roadshow New York, organized by Morgan Stanley 15/16-Nov-23 European TMT conference Morgan Stanley, Barcelona 21-Nov-23 ING Benelux conference, Brussels 21-Nov-23 Euronext Tech Leaders Campus, Paris 22-Nov-23 Van Lanschot Kempen conference, London 29-Nov-23 BofA Tech Hybr
Slide 17: IV. Financial Appendix
IV. FINANCIAL APPENDIX October 26, 2023 17
Slide 18: Through Cycle Revenue and Gross Margin Trends
Through Cycle Revenue and Gross Margin Trends € millions Revenue Gross Margin Gross Margin 800 70% 64.4% 700 60% 58.0% 600 51.1% 749 50% 500 516 567 593 39.5% 40% 424 400 34.1% 379 30% 300 302 4 year 351 averages 20% 200 164 191 10% 100 0 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 201
Slide 19: Revenue/Order Trends
Revenue/Order Trends Quarterly Trends Q3-23 vs. Q2-23 350 Revenue Orders • Revenue: -€ 39.2 million (-24.1%) 300 • Lower mobile shipments post H1 seasonal build 250 • Partial offset: increased computing/automotive 202 205 214 200 169 181 • Orders: +€ 14.7 million (+13.1%) € millions 153 163 150 125
Slide 20: IDM/Subcontractor Order Trends
IDM/Subcontractor Order Trends € millions 1,000 939.1 IDMs Subcontractors 900 800 45% 663.7 700 562.4 Orders 600 483.1 472.1 45% 500 39% 53% 39% 46% 400 32% 348.7 55% 300 39% 61% 55% 61% 47% 200 68% 55% 54% 100 61% 45% - 2018 2019 2020 2021 2022 LTM* * Last twelve months ended September 30, 2023 Oct
Slide 21: Gross Margin Trends
Gross Margin Trends Quarterly Trends 250 75% Revenue Gross Margin 214.0 202.4 Q3-23 vs. Q2-23 200 70% • 64.6% vs. 65.6% (-1.0 points) 168.8 133.4 162.5 • Above prior guidance (62-64%) due to net forex benefit 137.7 65.6% • Net forex positive: Revenue - USD vs. EUR € millions 150 64.6% 65% 64.2% 123.
Slide 22: Baseline Operating Expense Trends
Baseline Operating Expense Trends Baseline Opex Other Opex* Baseline Opex % of Revenue 50.0 50.0% 44.0 45.0% 43.7 39.9 40.0% 40.0 Operating Expenses (€ millions) 37.9 9.5 37.1 11.2 36.9 35.0% 9.4 4.7 34.0 2.8 3.3 0.9 30.0% 30.4 30.3 27.3% 30.0 24.9% 24.6% 25.0% 21.0% 19.6% 20.0% 17.6% 15.1% 15.5% 34
Slide 23: Headcount Trends
Headcount Trends 2,500 30.0% 2,141 1,994 1,968 1,973 25.0% 2,000 496 1,819 312 279 248 1,596 1,618 144 • HC aligned with market conditions: 20.0% 62 95 • Temporary HC down 60% from Q1-22 1,500 • Total HC down 15% from Q1-22 Headcount 15.0% 1,193 • Increasing European and Asian fixed 1,154 1,162 1,16
Slide 24: Net Income Trends
Net Income Trends Quarterly Trends 80 € 75.6 Net Income 60% Q3-23 vs. Q2-23 € 67.5 Net Margin • € 35.0 million (-€ 17.6 million or -33.5%) Adj. Net Margin • -24.1% lower revenue € 57.3 60 € 52.6 • -1.0 point gross margin decrease • Partial offset: Opex down 15.6% € millions € 40.2 40 € 34.5 € 35.0 4
Slide 25: Cash Flow Efficiency Trends
Cash Flow Efficiency Trends € millions % of Revenue 350 300 277.9 271.9 43.4% 250 241.9 200 37.4% 37.1% 37.6% 162.0 33.7% 150 120.1 100 50 0 2019 2020 2021 2022 LTM Total Cash Flow from Operations As % of Revenue October 26, 2023 25
Slide 26: Dividend Trends
Dividend Trends Cumulative dividends of € 1.2 billion since 2011, or € 15.63 per share Dividend (€) Dividend Payout Ratio Dividend 3.50 3.33 100% Dividend Payout Ratio 98% 98% 3.00 2.85 96% 2.50 95% 94% 2.00 92% 92% 1.67 1.70 90% 90% 90% 1.50 1.01 88% 1.00 86% 0.50 84% 0.00 82% 2018 2019 2020 2021 2
Slide 27: Share Repurchase Activity
Share Repurchase Activity Share Repurchases Average Cost per Share 200 190.3 120.0 100.0 150 146.8 € 81.59 Avg Cost per Share 80.0 € 69.84 € millions 100 60.0 € 54.38 € 38.05 40.0 50.1 50 44.6 35.5 € 24.31 € 21.86 20.0 17.8 0 0.0 2018 2019 2020 2021 2022 2023 • Approximately 4.0 million treasury sha
Slide 28: Investment Considerations
Investment Considerations Assembly market Long term secular Disciplined strategic Wafer level assembly ever more critical in trends drive focus has created an new growth semiconductor value advanced packaging industry leader opportunity chain growth Market presence has Tech leadership and Commitment
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