Entegris, Inc. · NASDAQ:ENTG
Entegris — Investor Day (July 2015)
47 slides from Entegris's investor day presentation, Jul 14, 2015
Slide 1: Entegris: creating a material advantage
iz) Entegris creating a material advantage
Slide 2: Agenda
Agenda Agenda 1:30 PM Welcome, Agenda, Safe Harbor Steven Cantor VP, Corporate Relations 1:35 PM A Premier Materials and Solutions Provider Bertrand Loy President and CEO 1:50 PM A Platform for Growth and Stability Todd Edlund SVP and COO Differentiation in a Disruptive Environment James O’Neill CTO
Slide 3: Safe Harbor
Safe Harbor Safe Harbor Certain information contained in this presentation may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current management expectations only as of the date of this p
Slide 4: A Premier Materials and Solutions Provider
Bertrand Loy President and CEO Bertrand Loy President and CEO A Premier Materials and Solutions Provider A Premier Materials and Solutions Provider
Slide 5: Key Takeaways
Key Takeaways Key Takeaways The ATMI acquisition has been a success and is creating significant value for all stakeholders IoT and new technology trends will continue to drive growth in our end markets Positioned to outperform market by leveraging our unique combination of technology breadth, global
Slide 6: Entegris Today
Entegris Today Entegris Today Revenues $1.1 Billion * EBITDA Margin 22% * EPS $0.78 * Unit-Driven Sales 77% *Trailing twelve months, as reported, Non-GAAP, ending 3/28/15
Slide 7: ATMI – A Transformational Deal
ATMI – A Transformational Deal ATMI – A Transformational Deal We’re not just a bigger platform, we’re a better company Enhanced scale and growth potential Significant cost synergies Efficient balance sheet EPS expansion Transaction closed April 2014, one year later… Complementary platforms fully int
Slide 8: Positive Unit Growth in the Industry
Positive Unit Growth in the Industry Positive Unit Growth in the Industry Over time, unit growth (MSI) far exceeds industry capital spending (WFE) MSI = millions of square inches of silicon; WFE = wafer fab equipment Source: Gartner, April 2015 2001-2018 CAGR: MSI 6.5% WFE 2.8% 0.0 0.5 1.0 1.5 2.0 2
Slide 9: Entegris will Benefit from the Internet of Things
Entegris will Benefit from the Internet of Things Entegris will Benefit from the Internet of Things Servers/Storage Sensors Devices Hyperconnectivity and big data are driving IC growth More powerful and ubiquitous server farms PC | mobile | wearable Infrastructure | health | auto home | everywhere
Slide 10: A Unit-Driven Model + Sticky Solutions = Greater Stability
A Unit-Driven Model + Sticky Solutions = Greater Stability A Unit-Driven Model + Sticky Solutions = Greater Stability MSI = millions of square inches of silicon; nm = nanometer Source: Gartner, April 2015 Semiconductor Industry Year-End Capacity by Linewidth (MSI/Year) Growth at the leading edge Sta
Slide 11: Uniquely Diverse Customer Mix
Uniquely Diverse Customer Mix Uniquely Diverse Customer Mix Equipment Makers Device Makers Materials Suppliers 57.0% 10% 5% 5% 6% 14% 3% Supplying solutions across the ecosystem *Trailing twelve months, as reported, Non-GAAP, ending 3/28/15 6-10 All others Customer Rank Top 10 Customers Comprise App
Slide 12: The Three Pillars of Our Organic Growth Strategy
The Three Pillars of Our Organic Growth Strategy The Three Pillars of Our Organic Growth Strategy Customer Value Proposition: Higher yields, improved performance, reduced costs Leveraging technology, people and processes to address customer needs Global Infrastructure Operational Excellence Technolo
Slide 13: Leveraging the Platform to Adjacent Markets
Leveraging the Platform to Adjacent Markets Leveraging the Platform to Adjacent Markets Entegris Entegris Non-Semi 21% Semiconductor 79% *Trailing twelve months, as reported, ending 3/28/15 LED Data Storage Flat Panel Resource Efficiency Other Industrial Solar Life Sciences Revenue by Market*
Slide 14: Going Forward – Creating Value for Stakeholders
Going Forward – Creating Value for Stakeholders Going Forward – Creating Value for Stakeholders Growth in excess of market (100-200 bps) Achieve target model Pay down debt EPS growth Growth in excess of market (100-200 bps) Achieve target model Pay down debt EPS growth Financial objectives Investmen
Slide 15: Entegris: creating a material advantage
CO. Entegris creating a material advantage
Slide 16: The Three Pillars of Our Organic Growth Strategy
The Three Pillars of Our Organic Growth Strategy The Three Pillars of Our Organic Growth Strategy Customer Value Proposition: Higher yields, improved performance, reduced costs Leveraging technology, people and processes to address customer needs Global Infrastructure Operational Excellence Technolo
Slide 17: Breadth of Entegris Portfolio
Breadth of Entegris Portfolio Breadth of Entegris Portfolio Advanced Photoresist Packaging Advanced Photoresist Packaging Filtration and Dispense Filtration and Dispense Gas/Liquid Purification Gas/Liquid Purification Gas Filters and Diffusers Gas Filters and Diffusers Gas Purification Gas Purificat
Slide 18: Deepening Our Collaboration with Strategic Customers
Direct engagement by engineering teams Pilot capability at most sites Direct engagement by engineering teams Pilot capability at most sites Deepening Our Collaboration with Strategic Customers Deepening Our Collaboration with Strategic Customers Relevant, Trusted Technology Partner Relevant, Trusted
Slide 19: Entegris Has a Full Product Pipeline
Entegris Has a Full Product Pipeline Entegris Has a Full Product Pipeline 6.4% 7.1% 8.0% 9.1% 9.8% 2011 2012 2013 2014 2015 YTD Entegris R&D/Sales* Half of increase focused on advanced research and core science Technical resources in Asia have grown by 30% Actively engaged with customers defining nm
Slide 20: Technology Breadth and Depth: Unlocking the Power of the New Entegris
Gases and Gas- Wetted Surfaces Solids and Solid Materials Delivery Wet Chemistries and Wetted Surfaces Technology Breadth and Depth: Unlocking the Power of the New Entegris Technology Breadth and Depth: Unlocking the Power of the New Entegris Entegris has unique ability to “put the pieces together”
Slide 21: New Initiatives Beginning on Many Levels
New Initiatives Beginning on Many Levels New Initiatives Beginning on Many Levels Taking advantage of our unique breadth of knowledge and product portfolio to move faster for our customers Value-added cross-selling of existing products Value-added cross-selling of optimized products New product deve
Slide 22: Global Infrastructure with Local R&D, Manufacturing and Support
Global Infrastructure with Local R&D, Manufacturing and Support Global Infrastructure with Local R&D, Manufacturing and Support Invested in infrastructure to serve global customer base Deep technical expertise and application knowledge Unique capabilities to enhance speed, effectiveness and efficien
Slide 23: Evolving Requirements for Operational Excellence
Evolving Requirements for Operational Excellence Evolving Requirements for Operational Excellence ISO 14000 On-Time Delivery Cost Competitive Roadmap Alignment ISO 9001 EICC ISO 14000 On-Time Delivery Cost Competitive Roadmap Alignment ISO 16949 ISO 9001 EICC ISO 14000 Conflict Minerals On-Time Deli
Slide 24: Entegris Received Intel's 2014 Preferred Quality Supplier Award
Entegris Received Intel’s 2014 Preferred Quality Supplier Award Entegris Received Intel’s 2014 Preferred Quality Supplier Award One of only 19 suppliers to receive this award for 2014 “Intel recognizes Entegris’ dedication in providing excellent performances across cost, quality, availability, techn
Slide 25: Differentiation in a Disruptive Environment
James A. O’Neill, Ph.D. Chief Technology Officer James A. O’Neill, Ph.D. Chief Technology Officer Differentiation in a Disruptive Environment Differentiation in a Disruptive Environment
Slide 26: Technology Inflection Points Keep Moore's Law Moving Ahead
Technology Inflection Points Keep Moore’s Law Moving Ahead Technology Inflection Points Keep Moore’s Law Moving Ahead Increased complexity, shortening lead times, yield sensitivity Keeping on Moore’s Law has required innovations in: Lithography (Multi-patterning and EUV) 3D Device Structures (3D NAN
Slide 27: Why Materials Matter: Advanced Electronics Require Advanced Materials
Why Materials Matter: Advanced Electronics Require Advanced Materials Why Materials Matter: Advanced Electronics Require Advanced Materials Positioned to benefit from increased reliance on formulated materials and growing complexity Increasing impact of materials innovation on chip performance Sourc
Slide 28: Insuring Contamination-Free Materials From Production to Consumption
Insuring Contamination-Free Materials From Production to Consumption Insuring Contamination-Free Materials From Production to Consumption Entegris has the technology to control contamination across the fluidics stream – from production to consumption Contamination can occur at multiple points in a c
Slide 29: Key Disruptive Technologies Below 14 nm
Key Disruptive Technologies Below 14 nm Key Disruptive Technologies Below 14 nm Metal gate Ge/Si S/D PMOS Litho 1 Right image: Intel High-k Penryn microchip 2009 Multi Patterning and EUV New Structures FinFET Device New Materials High-k metal gate transistor New defect sources, greater sensitivity t
Slide 30: Process Implications of Inflection Point Innovations
Process Implications of Inflection Point Innovations Process Implications of Inflection Point Innovations Advanced Photoresist Packaging Advanced Photoresist Packaging Filtration and Dispense Filtration and Dispense Gas/Liquid Purification Gas/Liquid Purification Gas Filters and Diffusers Gas Filter
Slide 31: Process Implications of Inflection Point Innovations
Process Implications of Inflection Point Innovations Process Implications of Inflection Point Innovations Advanced Photoresist Packaging Advanced Photoresist Packaging Filtration and Dispense Filtration and Dispense Gas/Liquid Purification Gas/Liquid Purification Gas Filters and Diffusers Gas Filter
Slide 32: Process Implications of Inflection Point Innovations
Process Implications of Inflection Point Innovations Process Implications of Inflection Point Innovations Advanced Photoresist Packaging Advanced Photoresist Packaging Filtration and Dispense Filtration and Dispense Gas/Liquid Purification Gas/Liquid Purification Gas Filters and Diffusers Gas Filter
Slide 33: Introduction of Cobalt Drives a New Product Cycle
Introduction of Cobalt Drives a New Product Cycle Introduction of Cobalt Drives a New Product Cycle Copper interconnect resistivity and reliability degrades as linewidth decreases – new metallurgy needed Copper Interconnect Copper Interconnect TaN/Ta Barrier Cobalt barrier, via, cap Cobalt contact E
Slide 34: Wet Process Sector Example
Wet Process Sector Example Wet Process Sector Example What matters to the customer Yield Metal contamination Organic contamination Particle contamination Wet Etch and Clean Performance Advanced process materials Device composition, geometry, properties Material compatibility Throughput Cost Lifetime
Slide 35: Entegris Wet Etch and Clean Roadmap Example
Entegris Wet Etch and Clean Roadmap Example Entegris Wet Etch and Clean Roadmap Example Performance Yield Cost Peroxide Monitor - - Bath Life 2016 Formulated Chemistry Cooptimized Filtration Peroxide Monitor Integrated capabilities roadmap: copper post-etch residue removal Customer Benefit InVue™ CR
Slide 36: What these Inflection Point Technologies Mean for Entegris
What these Inflection Point Technologies Mean for Entegris What these Inflection Point Technologies Mean for Entegris Key inflection point technologies represent an incremental revenue opportunity well in excess of $100M by 2018 Technology Commentary Multi- patterning More process steps drives incre
Slide 37: Financial Perspective
Greg Graves Executive Vice President and CFO Greg Graves Executive Vice President and CFO Financial Perspective Financial Perspective
Slide 38: Going Forward – Creating Value for Stakeholders
Going Forward – Creating Value for Stakeholders Going Forward – Creating Value for Stakeholders Growth in excess of market (100-200 bps) Achieve target model Pay down debt EPS growth Growth in excess of market (100-200 bps) Achieve target model Pay down debt EPS growth Financial objectives Investmen
Slide 39: Our Scorecard
Our Scorecard Our Scorecard Financial Objectives FY14 Q115 Growth in excess of market Achieve target model Pay down debt EPS growth
Slide 40: Target Model and Historical Performance
Target Model and Historical Performance Target Model and Historical Performance Quarterly Revenue Level Proven execution and leverage in the operating model Represents range of adjusted operating margin based on respective quarterly revenue levels. Adjusted for amortization of intangible assets and
Slide 41: Balance Sheet
Balance Sheet Balance Sheet $2.43 in cash per share Net leverage of 1.7x EBITDA $76 million in debt repayment since close of acquisition Commitment to repay an additional $75 million by end of Q3 $ and share data in millions March 28, 2015 December 31, 2014 Assets Cash and cash equivalents $341 $390
Slide 42: Entegris Financial Results
Entegris Financial Results Entegris Financial Results ATMI acquisition has driven significant EPS growth 2012-2014 Revenue and Non-GAAP EPS as reported. 2015 and 2016 Revenue and Non-GAAP EPS based on analysts estimates as of June 15, 2015. Non-GAAP EPS excludes acquisition-related costs and integra
Slide 43: EPS Growth Formula
2014 Non-GAAP As Reported 2014 Pro Forma Combined Two-Year Industry Growth 3 2.4% Growth > Industry 1.25% Operating Leverage Interest Expense Reduction 4 EPS Growth Formula EPS Growth Formula Revenue $962 $1,076 $1,128 $1,156 $1,156 $1,156 Operating Income $161 $222 $222 % of revenue 17% 19% 19% Int
Slide 44: Projected Cash From Operations and Free Cash Flow
Projected Cash From Operations and Free Cash Flow Projected Cash From Operations and Free Cash Flow By 2016, three-year cumulative cash from operations is estimated to reach more than $465 million 2014 2015P 2016P Capex FCF Total Cash Flow From Operations ($ in millions) $126 $160 $180 Note: 2014 is
Slide 45: Capital Allocation
Capital Allocation Capital Allocation Flexibility EPS Growth Our strategy to date has been focused on debt repayment Buyback Shares Repurchase 6% Notes Repay 3.5% Term Loan Retain Cash; Build Liquidity Balancing Priorities M&A
Slide 46: Key Takeaways
Key Takeaways Key Takeaways The ATMI acquisition has been a success and is creating significant value for all stakeholders IoT and new technology trends will continue to drive growth in our end markets Positioned to outperform market by leveraging a unique combination of technology breadth, global c
Slide 47: Entegris ® ,
Entegris ® , the Entegris Rings Design ® and Creating a Material Advantage ® are trademarks of Entegris, Inc. ©2015 Entegris, Inc. All rights reserved.