BE Semiconductor Industries N.V. · EURONEXT:BESI
BE Semiconductor Industries — Shareholder Meeting (April 2023)
33 slides from BE Semiconductor Industries's shareholder meeting presentation, Apr 26, 2023
Slide 1: Annual General Meeting of Shareholders
ANNUAL GENERAL MEETING OF SHAREHOLDERS April 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: Agenda
Agenda I. Company Overview II. Market III. Strategy IV. Financial Review V. Q1-23 Results & Outlook April 26, 2023 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW April 26, 2023 4
Slide 5: Key Highlights 2022 - 2021
Key Highlights 2022 - 2021 2022/21 € millions except % and EPS 2022 2021 Variance Revenue € 722.9 € 749.3 -3.5% Orders € 663.7 € 939.1 -29.3% Gross Margin 61.3% 59.6% +1.7 Net Income € 240.6 € 282.4 -14.8% Net Margin 33.3% 37.7% -4.4 EPS (Basic) € 3.03 € 3.70 -18.1% Return on Average Equity 38.6% 57
Slide 6: Through Cycle Revenue and Gross Margin Trends
Through Cycle Revenue and Gross Margin Trends € millions Revenue Gross Margin Gross Margin 800 70% 700 749 723 60% 58.0% 600 51.1% 50% 593 516 500 39.5% 40% 424 400 34.1% 379 30% 300 4 year 302 averages 351 20% 200 164 191 10% 100 0 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Slide 7: Performance Significantly Above Last Industry Downturn
Performance Significantly Above Last Industry Downturn Revenue (€MM) Orders (€MM) 1000 1,000 939 900 749 900 800 723 800 700 681 593 700 664 600 525 600 500 483 500 400 400 300 300 200 200 100 100 0 2017 2018 2021 2022 - 2017 2018 2021 2022 Operating Profit (€MM) Operating Margin 350 45% 42.4% 318 4
Slide 8: End-User Market Trends 2021/2022
End-User Market Trends 2021/2022 2021 Spares/ Industrial/ 2022 Mobile Computing Automotive Revenue Service Other Revenue April 26, 2023 8
Slide 9: Capital Allocation More Than Doubled vs. 2021
Capital Allocation More Than Doubled vs. 2021 Share Buybacks Increased to € 146.8 million 500 € 1.6 Billion Distributions Since 2011* 416.3 400 Dividends • Record € 416.3 million distributed Share Repurchases 146.8 298.8 300 • New € 300 million share buyback € millions 77.8 program: 209.5 • Started
Slide 10: Peer Leading Financial Metrics
Peer Leading Financial Metrics Key Financial Metrics (LTM*) Worst BESI Best Peer Peer Revenue Growth 18.3% -28.7% -28.7% -25.2% -3.5% 18.3% Besi’s margins and ROE have exceeded direct peers through Gross Margin cycles: 44.6% 64.0% 44.6% 50.3% 61.3% 64.0% • Investment in business model has yielded hi
Slide 11: Total Return Outperformance Versus Peers and SOX Index
Total Return Outperformance Versus Peers and SOX Index in 2022 and For Past 3 Years 2022 Total Shareholder Return 3 Year Cumulative Shareholder Return Besi vs. Peers, REM Reference Group & SOX Index Besi vs. Peers, REM Reference Group & SOX Index Besi Peer Group Average PHLX Semiconductor (SOX) REM
Slide 12: Besi Market Cap & Liquidity Has Expanded
Besi Market Cap & Liquidity Has Expanded Shareholdings Migrated from NL to US/UK over Past Years Avg. Daily Volume and Liquidity Symbol/ • BESI Index • Euronext AEX 1,400 80 1,200 Avg Vol * Avg Price (€ thousands) 60 Market 1,000 Volume (thousands) Market • € 6.2 billion 800 40 ($ 6.7 billion) 600 C
Slide 13: II. Market
II. MARKET April 26, 2023 13
Slide 14: Assembly Market Estimates Reduced
Assembly Market Estimates Reduced Rebound Forecast 2024-2025 8.0 68.0% 80% Market Size YoY Growth Rate 7.0 6.5 6.1 5.8 60% 6.0 TechInsights now forecasts 23.2% 5.2 40% downturn in 2023 US$ billions 5.0 4.4 3.9 • Versus -16.8% prior forecast 4.0 3.2 21.2% 17.0% 18.1% 20% • Market decreases to $4.4 bi
Slide 15: Industry Downturn Continues in 2023
Industry Downturn Continues in 2023 TechInsights Global Chip Making Climate Trend Index 120 2/21: Intel, TSMC, 7/22: Memory 110 Samsung hike capex Inventory Correction 100 Temperature in Degrees F 90 2/20: COVID-19 outbreak 80 70 Growth Decline Line 60 5/19: U.S.- China trade war escalates 50 40 30
Slide 16: Long-Term Semiconductor Demand Growth Continues
Long-Term Semiconductor Demand Growth Continues 1,400 2030 1,200 Semi revenue > $1T 2018 1,000 Machine generated data > • Market required 50 years to reach human generated data $500 billion in sales Semi revenue = $469 bn 800 • 10 years estimated to reach $ billion 2002 Quantum Era First Blackberry
Slide 17: Long Term Secular Growth Drivers
Long Term Secular Growth Drivers Mobile: 5G Wearables 3D sensors Advanced cameras New Features Technology: Well Computing: New chiplet & 3D Positioned for AI goes Next mainstream architectures, Generation Big data High bandwidth Edge computing memory Opportunities Silicon photonics Automotive: Auton
Slide 18: Growth Expected to Favor Besi's Product Portfolio, Particularly Die Attach
Growth Expected to Favor Besi’s Product Portfolio, Particularly Die Attach CAGR (2020-2025) Die Attach 12.2% Packaging & Plating* 9.8% 7,000 6,490 6,145 Other Assembly 8.7% 5,785 6,000 Total 9.7% 1,566 5,202 1,621 1,349 5,000 4,445 799 1,353 3,863 $ millions 767 784 4,000 1,139 911 663 566 3,000 491
Slide 19: Hybrid Bonding Market Potential
Hybrid Bonding Market Potential Total # of installed hybrid bonding systems 2000 1800 High case OSATS likely Cumulative Total: € 3.0B 1600 to follow when technology Mid case • Hybrid now on radar of all major semi 1400 matures Cumulative Total: € 2.4B producers Hybrid bonding 1200 adopted for 1000 m
Slide 20: Hybrid Bonding 2022 Update
Hybrid Bonding 2022 Update Industry Adoption Besi Progress • Active development by leading • 35 units shipped since Q4-21 semiconductor producers • 28 units shipped in 2022 • Full scale commercial production for • 14 new orders post Q3-22 high performance CPUs • 3 to date in Q1-23 • Memory applicati
Slide 21: III. Strategy
III. STRATEGY April 26, 2023 21
Slide 22: Strategy Update
Strategy Update • Responded effectively to industry downturn • Expanded R&D investment for next generation applications Business • Significant progress on wafer level assembly portfolio • Key ESG targets exceeded • Capital allocation to shareholders increased • Gross R&D spending increased 23% in 20
Slide 23: Key Business Objectives 2025
Key Business Objectives 2025 Business Model Objectives Revenue € 1 billion++ Addressable Market Share 40%+ Gross Margin 57-62% Net Margin 30-35% Headcount Split 80% Asia/20% Europe/NA Scope 1 and 2 Emissions 62% reduction Global Energy Needs 75% from renewable sources April 26, 2023 23
Slide 24: Significant ESG Progress. Key Targets Met or Exceeded
Significant ESG Progress. Key Targets Met or Exceeded Process Pillar 2022 Target 2022 Progress 15% Reduction in Scope 1 & 2 64% Reduction in Scope 1 & 2 emissions intensity vs 2021 emissions vs. 2019 index 5% reduction in hazardous waste Relative and absolute reduction in hazardous waste Environment
Slide 25: Enhanced ESG Targets
Enhanced ESG Targets 2024 2030 75% renewable sources for 90% renewable sources for global energy needs global energy needs 62% reduction in Scope 1 and 2 58% reduction in Scope 1 and 2 carbon emissions* carbon emissions* 12% reduction in Scope 3 58% reduction in Scope 3 carbon emissions* carbon emis
Slide 26: IV. Financial Review
IV. FINANCIAL REVIEW April 26, 2023 26
Slide 27: Key Metrics 2018 – 2022
Key Metrics 2018 – 2022 Revenue & Baseline Opex Headcount Net Income Gross Margin 800 250 240.6 40% 160 149.0 2,000 722.9 1,819 68% 1,759 700 1,800 140 17.9 67 1,618 144 35% 125.7 200 600 1,600 33.3% 95 525.3 120 11.3 108.7 30.5% 1,400 30% 500 62% 100 11.9 150 433.6 61.3% 1,200 136.3 132.3 € million
Slide 28: Through Cycle Gross Margin Resilience
Through Cycle Gross Margin Resilience Revenue Gross Margin Gross Margin adjusted 250 80% 226.1 208.3 214.0 Industry Downturn 202.4 75% 200 171.7 168.8 70% Gross Margin % 143.2 € millions 150 137.7 133.4 65% 64.2% 100 62.1% 62.3% 62.3% 61.0% 61.0% 60.4% 60.1% 60% 58.2% 56.7% 50 55% 0 50% Q1-21 Q2-21
Slide 29: Strong Liquidity Position
Strong Liquidity Position Cash and Deposits Net Cash 800 700 672.2 671.7 • Solid cash flow generation: • Net cash of € 346.5 million at year end (-6.5%) 598.7 600 • Includes outflows of € 416.3 million for dividends and share repurchases (+131.9%) 500 475.5 • Attractive funding to help finance growt
Slide 30: V. Q1-23 Results & Outlook
V. Q1-23 RESULTS & OUTLOOK April 26, 2023 30
Slide 31: Strong Performance In Current Industry Downturn
Strong Performance In Current Industry Downturn Guidance € millions Q1-23* Q1-23 ∆ Q4-22 ∆ Q1-22 Revenue Down 0%-10% 133.4 -3.1% -34.1% Orders 142.0 -21.3% -30.7% Gross Margin 61-63% 64.2% +1.9pts +4.1pts Opex +15-20% 44.0 +18.6% +10.3% Operating Income 37.6*** 41.7 -14.4% -49.0% Net Income 34.5 -14
Slide 32: Guidance Q2-23 & H1-23
Guidance Q2-23 & H1-23 € in millions Revenue Gross Margin Total Operating Expenses Flat Q2-23 € 133.4 +15% - 64.2% 62%-64% € 44.0 - -5% +25% Q1-23 Q2-23 Q1-23 Q2-23 Q1-23 Q2-23 Flat +/- 5% Revenue Gross Margin Total Operating Expenses HY1-23 € 416.4 -30% 60.5% ~63.5% € 77.9 +12% HY1-22 HY1-23* HY1-2
Slide 33: 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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