Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Besi — Investor Presentation (June 2015)
46 slides from Be Semiconductor Industries's investor presentation, June 2015
Slide 1: Investor Presentation June 2015
INVESTOR PRESENTATION JUNE 2015
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 press release, including , but not limited to, statements relating to e
Slide 3: Agenda
Agenda I. Company Overview II. Market III. Strategy IV. Financial Review V. Outlook & Summary June 2015 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW June 2015 4
Slide 5: Besi Overview
Besi Overview • Leading assembly equipment supplier with #1 and #2 positions in key products. 28.5% addressable market share • Broad portfolio: die attach, packaging and plating Corporate Profile • Strategic positioning in substrate and wafer level packaging • Global mfg. operations in 7 countries;
Slide 6: Company History
Company History 55% Die Attach Acquisitions € 403.7 400 50% • 2000 2002 2005 2009 45.3% 45% 300 Restructuring Revenue (€ millions) Gross Margin (%) • 2006 Dragon I complete: € 6 million cost savings • 2008 Dragon II complete: € 15 million cost savings 40% • 2010 Plan: € 7.0 million cost savings. Hea
Slide 7: Best in Class Product Portfolio
Best in Class Product Portfolio Die Attach Packaging & Plating In Development • Die Bonding • Molding - 2100 xPplus - AMS series • Next generation Die Attach - 2100 sDplus - AMS LM 95 - 2100 sD PPPplus - MMS series • Next generation Packaging - 2100 hS New - FML New • Common modules Esec - 2009 SSI
Slide 8: Product Positioning
Product Positioning Semiconductor Manufacturing Equipment (2014: $40.1B) Front end: $32.2B (80%) Assembly: $4.0B (10%) Test: $3.9B (10%) Semiconductor Assembly Process Dicing Die Attach Wire Bond Packaging Plating Die Sort Die Bond Wire Bond Molding Trim & Form Plating Leadframe Assembly Singulation
Slide 9: Customer Ecosystem
Customer Ecosystem Customers OEMs End Products IDMs Subcontractors • Blue chip customer base, top 10 = 60% of 2014 revenue • Leading IDMs and subcontractors. 60/40% split in 2014 • Equipment utilized to produce chips for leading fabless companies: Qualcomm, Broadcom, MediaTek • Long term relationshi
Slide 10: Current Operational Profile
Current Operational Profile Duiven & Drunen, (The Netherlands)* Cham, Radfeld, (Austria)* (Switzerland)* Chandler Suzhou Chengdu Korea Shanghai Leshan Sales Office Taiwan Shenzhen Production Site Malaysia Philippines Sales & Production Site Singapore* * R&D Site as of 31 March 2015 • Development act
Slide 11: Summary Historical Financials
Summary Historical Financials • Record 2014 Results: Year Ended December 31, • Revenue and orders +48.6% and 61.8% (€ millions, except share data) 2012 2013 2014 • Gross Margin +4.0% to 43.8% • Net Income +341% to € 71.1 million • Net cash +€ 47.0 million Revenue 273.7 254.9 378.8 Orders 276.1 251.9
Slide 12: Stock Price Information
Stock Price Information Market profile has improved: • Approximate € 900 million market capitalization • Upgraded to Euronext AMX mid cap index in March 2015 Liquidity has increased significantly over past three years: • Average daily volume: • 2013: 99,811 • 2014: 117,084 • 2015: 219,887 Share conc
Slide 13: Dividend Trends
Dividend Trends Dividend EPS (diluted) Total Dividend Yield (a) 2.00 12.0% 1.87 1.80 10.0% 1.60 1.50 1.40 8.1% 1.25 8.0% Dividend yield 1.20 Dividend (€) 1.00 5.2% 6.0% 0.80 0.73 4.0% 4.0% 4.3% 4.0% 0.60 0.42 0.43 0.40 0.30 0.33 0.22 2.0% 0.20 0.20 Payout Ratio: 16% 30% 71% 77% 80% 0.00 0.0% 2010 20
Slide 14: II. Market
BeSi asm Il. MARKET June 2015
Slide 15: Assembly Equipment Market Composition
Assembly Equipment Market Composition Assembly Equipment Market * Besi Addressable Market * (2014: $4.0 billion) (2014: $1.7 billion) Lead Trim & Plating Other Form 2.0% Assembly 5.5% (Inspection, Wire Bonding Molds Dicing) 21.7% 13.5% 25.9% Die Bonding 39.7% Presses Plating 11.2% Die Attach 0.9% 59
Slide 16: Assembly Equipment Market Trends
Assembly Equipment Market Trends Market Size Assembly Equipment YoY Growth Rate 6.0 40% 5.0 29.1% 30% 4.9 (US$ billions) 4.6 20% 4.0 4.4 4.0 4.0 4.0 3.9 10% 16.3% 7.7% 3.0 3.1 1.6% 0% -2.5% • VLSI forecasts flat growth next 2 2.0 -9.2% -10% years post big 2014 increase as 1.0 -20% capacity is digest
Slide 17: Advanced Packaging Unit Volume and Market Share Are Increasing
Advanced Packaging Unit Volume and Market Share Are Increasing Advanced Packaging Silicon Demand Growth & Market Share 2010 - 2019 45 Advanced Packaging Wafers 38% 40% 37% Advanced Packaging Unit Market Share (%) 35% 40 34% 32% 35% 31% 35 CAGR 2010-2019: 21.1% 30% M wafers, 300MM Eq. 26% AP Market S
Slide 18: Driven Primarily by Growth in Internet Connected Devices
Driven Primarily by Growth in Internet Connected Devices • Key End Use Applications: • Mobile internet devices, connectivity, computing power, Big Data analytics, automotive • 35% CAGR device growth forecast over next 5 years • Powered primarily by devices used for IoT • Positive trajectory for smar
Slide 19: Requiring Changes in Process/Equipment Development
Requiring Changes in Process/Equipment Development Front End Today=> Tomorrow Transistor Scaling Lithography New Structures 3D Back End Assembly More Contacts Smaller Pitches Thinner/denser more complex packages From Simple Wire Bond to BGA/Flip Chip to Complex 3D structures with TSVs, Stacked Struc
Slide 20: Which Has Significantly Increased Semi Equipment Spending for <25 Nano Nodes
Which Has Significantly Increased Semi Equipment Spending for < 25 Nano Nodes • Spending on <25 nano nodes has increased from ~15% in 2011 to an estimated 70% of total spending in 2015 • Node shift below 20 nano = new assembly equipment capacity June 2015 20
Slide 21: Advanced Packaging Growth Favors Besi
Advanced Packaging Growth Favors Besi Greater Miniaturization High Growth End Greater Higher Accuracy Complexity User Areas: Datacon Esec Fico Die Attach • Die Sorting: DS 9000 Mobile internet • Die Bonding: ES 2009, ES2100 • Flip Chip: DC 8800, ES2100 devices, Autos, • TCB: DC 8800 TCB • Multi Modu
Slide 22: And Is Reflected in Besi End User Application Trends
And Is Reflected in Besi End User Application Trends 2014 Spares/ Service Computer, 15% PCs LED 20% 3% • Mobile internet devices Industrial now equal 35% of 2008 10% Besi’s end user Service revenue 2% LED Industrial 3% Mobile 10% Internet Auto Devices • Automotive has also 17% 35% increased signific
Slide 23: New Smart Phone Designs Increase Besi's Addressable Market Potential
New Smart Phone Designs Increase Besi’s Addressable Market Potential Generation Generation Main Components Manufacturer IDM/OSAT Besi system Utilized - New 2012 2014 Processor X X Apple TSMC ->Amkor/Stats/ASE 8800FCQ, AMS-W/LM DRAM Memory X X Hynix/Micron Hynix/Micron 2100sD, FSL NAND Flash X X Hyni
Slide 24: Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity
Flip Chip/Wire Bond Process Shift Is Another Revenue Opportunity 2014* 2019* Wire Bonding Flip Chip Bonding Flip Chip Flip Chip $356 Wire $508 29% Bonding 34% Wire Bonding $994 $861 66% 71% Flip Chip Advantages Reduces board area Offers higher speed CAGR 2014 - 2019* by up to 95%. electrical Flip Ch
Slide 25: Thermo Compression Bonding Is An Emerging Assembly Technology
Thermo Compression Bonding Is An Emerging Assembly Technology TCB: Next Die Bonding Process Evolution: • Besi has most advanced concept in the industry • 7 Axis bondhead • 2 bond heads per system • High throughput => 2x competition • Compact design • User friendly • Orders/production significantly e
Slide 26: Besi Has Gained Share In Its Addressable Markets
Besi Has Gained Share In Its Addressable Markets Besi Market Share Source: VLSI, May 2015 and Besi estimates 2012 2013 2014 Total Assembly Equipment Sales 8.6% 10.6% 12.7% Besi Addressable Market 21.4% 26.0% 28.4% Total Die Attach Equipment 26.8% 31.2% 34.7% Die Bonding 29.7% 39.2% 38.7% Flip Chip 2
Slide 27: And With Leading Edge Technology Customers
And With Leading Edge Technology Customers Die Attach Packaging In USD 2012 2013 2014 2015 (a) 2012 2013 2014 2015 (a) • Customers are largest semi mfrs. • Engaged in most advanced Subcontractors ASE 67% 59% 69% 74% 36% 65% 36% 28% packaging applications Amkor 75% 84% 89% 100% 45% 11% 22% 38% JCET (
Slide 28: III. Strategy
BeSi asm Il. STRATEGY June 2015
Slide 29: Summary Strategy
Summary Strategy Develop new products and markets • Maintain best in class tech leadership in advanced packaging • Expand tech capabilities and applications for TCB, thin die, eWLB die bonding; large area, ultra thin and wafer level molding Increase market share in addressable markets • Leverage lea
Slide 30: Besi Revenue Growth Drivers
Besi Revenue Growth Drivers World tooling up for new tech cycle <20 nano Solar cell plating Increased transition from smart phone copper to functionality silver Revenue Growth TCB Drivers New device expansion to introductions: memory and IoT, wearables logic devices Increased share of Wire bond/flip
Slide 31: Operations Agenda
Operations Agenda 2015 2016 Operational Objectives Transfer of certain Swiss Die Attach software, logistics and administrative functions to Singapore Transfer of certain die bonding production from Malaysia to China Transfer of Plating Production from NL to Malaysia Further reduction of European bas
Slide 32: Asian Production Has Significantly Expanded
Asian Production Has Significantly Expanded Total Asian Shipments Direct Asian Shipments % Direct 1,200 96.3% 100.0% 84.0% 86.0% 90.0% 1,000 927 963 80.0% % Direct Shipments 68.0% 70.0% 800 Shipments 60.0% 42.9% 600 658 673 50.0% 579 553 40.0% 487 400 396 30.0% 331 20.0% 200 170 10.0% - 0.0% 2010 20
Slide 33: Leading to Lower European Headcount
Leading to Lower European Headcount Europe/NA Fixed HC Asia Fixed HC Total 1,800 1,600 1,543 1,510 1,530 1,479 1,434 1,400 1,200 • Fixed European/North American 802 799 933 headcount reduction: Headcount 52% 54% 810 908 1,000 60% 61% • Down 19.4% since 2011 56% • Declined from 56% of total in 2009 t
Slide 34: And Also Reduced Break Even Revenue Levels
And Also Reduced Break Even Revenue Levels 300 (13.0%) 270 250 235 (9.8%) (2.4%) 200 212 207 (€ millions) 150 100 50 - 2011 2012 2013 2014 June 2015 34
Slide 35: Workforce Has Become More Scalable and Flexible
Workforce Has Become More Scalable and Flexible 2,500 12.0% 10.0% 2,000 1,680 1,607 1,632 1,539 8.0% 64 1,458 122 150 • 2014 revenue ramp achieved Temp % of Total 1,500 60 24 using primarily Asian Headcount production temps 6.0% 802 799 1,000 810 908 933 • Aggregate headcount varies with cyclicality
Slide 36: Materials Cost Reduction Is Also a Key Priority
Materials Cost Reduction Is Also a Key Priority Supply Chain Actions • Qualify and Select Asian Vendors • 75% of material is now purchased in Asia • Significant potential cost savings Estimated savings 2014 2015E 2016/17E Headcount € 0.9 MM € 2.8 MM € 1.0 MM Materials Cost € 2.7 MM € 1.6 MM € 1.5 MM
Slide 37: Partially Achieved Through Common Parts Product Redesign
Partially Achieved Through Common Parts Product Redesign Potential Unit Cost Savings DB2100 (7%) • Magazine handler • Wafer gripper 2200evo (11%) • Dispenser Areas of focus: • Wafer table • Wafer Cassette Handler • Die Ejector 8800FCQ (11%) • Control Platform Average (9%) • Development efforts under
Slide 38: IV. Financial Review
IV. FINANCIAL REVIEW June 2015 38
Slide 39: Revenue Growth and Margin Expansion Yield Increased Profitability
Revenue Growth and Margin Expansion Yield Increased Profitability Q1-15/Q1-14 FY 2014/FY 2013 Revenue Net Income Revenue Net Income 95% 400 € 95% 90% € 378.8 90% € 94.9 € 100 85% +48.6% 85% 350 € +35.6% 80% 80% 75% 75% € 70.0 70% 300 € 70% € 254.9 € 75 Gross Margin 65% Gross Margin 65% 42.3% +6.7 po
Slide 40: Quarterly Book to Bill Trends Reflect Seasonality and Volatility
Quarterly Book to Bill Trends Reflect Quarterly Seasonality and Volatility 1.75 1.50 Assembly Market 1.34 1.26 1.25 1.10 0.97 1.04 1.01 1.10 1.00 0.94 0.99 0.95 0.81 0.75 Total Semi 0.71 Equipment 0.69 0.68 0.50 Mar Jun Sept Dec Mar Jun Sept Dec Mar Jun Sept Dec Mar Jun Sept Dec Mar Apr May 11 11 11
Slide 41: Revenue/Order/Gross Margin Trends
Revenue/Order/Gross Margin Trends Revenue Orders Gross Margin Adjusted Gross Margin • Cyclical quarterly revenue/order patterns: 140 60.0% • Three cycles past 3 years 116 124 • Short term patterns due to customer 120 caution and increased seasonality 111 55.0% • 2014 year end shows higher base line
Slide 42: Net Income Trends
Net Income Trends Net Income ex. NR Non Recurring Net Margin 24 22.9 21.5 35% 21 19.7 17.5 18 25% • Quarterly net income trends reflect industry 22.2% 3.3 and seasonal volatility 20.8% 19.7% 15 18.5% 7.5 • Profit/margin increase aided by revenue 15% (euro in millions) growth, through cycle gross mar
Slide 43: Liquidity Trends
Liquidity Trends Cash Debt Net Cash 180 161.6 160 • Solid liquidity position 135.3 • € 161.9 million cash at 3/31/15 140 133.1 • € 4.29 per share vs. € 29.87 price (as of March 31, 2015) 120 118.0 • Net cash reached € 133.1 million at end of 105.4 Q1 2015 (euro in millions) 100 91.9 89.6 81.1 83.8 7
Slide 44: V. Outlook & Summary
V. OUTLOOK & SUMMARY June 2015 44
Slide 45: Q2-15 Guidance
Q2-15 Guidance Revenue Gross Margin* Operating Expenses* € 94.9 48.2% € 28.3 Up 48% Up - 10-15% 5-7% 46% Q1 Q2 Q1 Q2 Q1 Q2 *excluding restructuring benefit • Underlying business growth continues • Revenue up approximately 10-15% vs. Q1-15 • Gross margins of 46-48% • Opex up 5-7% vs. Q1-15 due primar
Slide 46: Summary
Summary Leading semi assembly equipment supplier with #1 Technology leader. Best in Gaining market share in or #2 positions in fastest class product portfolio advanced packaging growing assembly segments Significant upside potential. Scalability and profitability Committed to enhancing of business m