Materion Corporation · NYSE:MTRN
Materion — Brush Engineered Materials — Jefferies 6th Annual Global Industrial and A&D Conference 2010
47 slides from Materion's conference presentation, Aug 6, 2010
Slide 1: Jefferies 6th Annual Global Industrial and A&D Conference
Jefferies 6th Annual Global Industrial and A&D Conference August 12, 2010 .... a leader in creating innovative engineered material solutions and services to make our customers competitive on a global basis .... while enhancing earnings growth, shareholder value, and stability ... by broadening techn
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements These slides contain (and the accompanying oral discussion will contain) "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could
Slide 3: Brush Engineered Materials Inc. Profile
3 Brush Engineered Materials Inc. Profile A leading manufacturer of high performance advanced engineered materials and services ... an enabling materials technology company Four segments ... with operations, service centers and major office locations in North America, Europe and Asia Serving long-te
Slide 4: Company Overview
4 Company: Brush Engineered Materials Inc. founded 1931, publicly traded since 1956 NYSE Ticker: BW Shares Outstanding: Approximately 20.3 million at 7/02/10 Market Cap: Approximately $387 million at 7/02/10 Component of: S&P Super Composite 1500, Russell 2000 S&P SmallCap 600, Russell 3000 2009 Rev
Slide 5: BEM....the transformation
BEM....the transformation From Metals & Mining through Specialty Metals to Advanced Materials From an "old industrial" to a "new age materials technology" company 5
Slide 6: BEM....the transformation (cont.)
BEM....the transformation (cont.) Broaden the base...focused on > GDP opportunities new technologies new markets new products expanded geography Target fastest growing segments of fast growing markets First Priority.....organic growth Second Priority...."manageable" acquisitions All while building a
Slide 7: BEM....the transformation (cont.) Targeted business model
BEM....the transformation (cont.) Investments...prioritizing a targeted business model Low capital intensity...both working capital and reinvestment capital High IP....technology driven business Non-commodity products...high margins Good growth potential in >> GDP opportunities Acquisition goals Acc
Slide 8: BEM....the transformation (cont.)
BEM....the transformation (cont.) 8 Integrated Metals Advanced Materials 29% 71%
Slide 9: Targeted acquisitions increasingly important to total sales
Targeted acquisitions increasingly important to total sales 9 $ in millions 26% 100% 74%
Slide 10: Acquisitions
Acquisitions 2005 OMC Shield kit cleaning services (technology buy) 2005 TFT Thin film vacuum sputtered coatings 2006 CERAC Inorganic chemicals ... powders and evaporative targets (optics, security, solar, semiconductor) 2008 Techni-Met Thin film roll to roll flexible substrate vacuum sputtered coat
Slide 11: Barr Associates, Inc.
Barr Associates, Inc. Acquisition announced on October 23, 2009 Based in Westford, Massachusetts with approximately 300 employees in three leased facilities in the Westford area Leading manufacturer of precision thin film optical filters that enable complex technologies and components throughout the
Slide 12: Academy Corporation
Academy Corporation Acquisition announced on January 5, 2010 Based in Albuquerque, New Mexico with approximately 150 employees in four leased facilities in Albuquerque and Gallup, New Mexico Leading provider of precious and non-precious metals and refining services to customers in a number of techni
Slide 13: Brush Engineered Materials - Major Segments
13 Brush Engineered Materials - Major Segments Williams Advanced Materials PVD Targets Optical Coatings Refining Electronic Packaging 67% Alloy (Cu based Be and Ni Alloys) Electronic Connectors Industrial Components 23% Be Products Defense/Aerospace Specialty Commercial Products 5% TMI (Specialty Cl
Slide 14: Revenue by Market
BEM YTD Q2 2010 14 Consumer Electronics 27% Telecom Infrastructure 7% *Value-added revenue, excludes high value metals Revenue by Market* Automotive Electronics 8% Appliance 7% Other 6% Services 4% Energy 6% Medical 6% Defense and Science 15% Industrial and Commercial Aerospace 14%
Slide 15: 2009 Recap
15 2009 Recap Sales of $715 million Diluted earnings per share of $(0.61) Acquisition of Barr Associates, Inc. for $55.2 million Barr produces precision thin film optical filters that enable complex technologies and components throughout the defense, aerospace, medical, energy, semiconductor, teleco
Slide 16: YTD Q2-2010
16 YTD Q2-2010 Sales of $621 million Diluted earnings per share of $1.00 Acquisition of Academy Corporation for $23 million Academy is a leading provider of precious and non- precious metals and refining services to customers in a number of technically demanding end-use markets including architectur
Slide 17: 2010 Outlook
17 2010 Outlook Demand has increased across the Company's key markets including consumer electronics, telecom infrastructure, automotive electronics, industrial and commercial aerospace, defense and energy Demand was stronger than expected in the second quarter and the strength has continued into th
Slide 18: Strength in Challenging Times
Strength in Challenging Times Balance Sheet Revolver $240 mm committed facility, matures November 2012 Debt Debt to total capital of 25% 18
Slide 19: Brush Engineered Materials ... core competency
19 Brush Engineered Materials ... core competency Collaborating with customers worldwide to solve material application challenges ... with a focus on enabling technology and services "Own" a Niche orientation ... non-commodity Focus on global growth and service Constantly looking ahead to realign pr
Slide 20: Global Sales and Distribution Network
20 Global Sales and Distribution Network Operations in the U.S. and eleven foreign countries International sales are approximately 29% of the Company (YTD Q2 2010) Act globally ... service locally! ?-------------- Asia / Pacific ------------? ? ---------------- Europe -------------- ? ? - Exports fr
Slide 21: Strong customer collaboration
21 Strong customer collaboration ... providing enabling technology solutions and service Materials that meet design challenges requiring - Strength - Reliability - Electrical conductivity - Miniaturization - Weight reduction - Corrosion resistance - Reflectivity - Thermal conductivity Targeting prof
Slide 22: Typical End Uses
22 Typical End Uses Data Storage Industrial products for Oil & Gas and Mining Medical Devices Cellular phones, i-Pods(tm) and other wireless communication devices Notebook computers and network servers Electronic components in cars and trucks Commercial Aerospace Defense
Slide 23: Applications - Cell Phones
23 Applications - Cell Phones I/O Connector Contacts (Alloy): Brush 60/17410 Alloy 25/190/290 Battery Contacts (Alloy): Brush 60 Alloy 25/190/290 Internal Antenna Contacts (Alloy): Brush 60/17410 Alloy 25/190/290 Grounding Clips and Audio Jacks (Alloy): Brush 60 Alloy 25/190/290 Micro Mezzanine Conn
Slide 24: Applications - Photovoltaic (Solar)
Applications - Photovoltaic (Solar) Technology: Amorphous Silicon (a-Si, tandem and multi- junction) Thin Film (PVD) Materials Silicon based photovoltaic cells Front and back contact layers TCO Transparent Conductive Oxide layers Technology: Cadmium Telluride (CdTe) Thin Film (PVD) Materials Cadmium
Slide 25: Applications - Hard Disk Drives
25 Thin film materials for the read/write head. (WAM) Sputtering Targets/Evaporation Materials (Precious Metals, Alloys, Non-Precious Metals, Alloys, Magnetic Materials, Heusler Alloys and Oxides) Applications - Hard Disk Drives Disk Drive Arm (TMI) Clad Materials (Aluminum and Stainless Alloys) App
Slide 26: Applications - Oil & Gas
26 Applications - Oil & Gas Under Water Wellhead Equipment (Alloy): Brush Alloy 25 ToughMet(r) 3 Blow out preventers, hydraulic actuators Directional Drilling Equipment (Alloy): Brush Alloy 25 ToughMet(r) 3 MWD, LWD, MPT systems Drill Bits (Alloy): Brush Alloy 25 ToughMet(r) 3 Structural Rig Compone
Slide 27: Applications - Aerospace
27 Applications - Aerospace Avionics/Electrical Systems (Alloy): Alloy 25 Airframe (Alloy): Alloy 25 Landing Gear Attachments (Alloy): Alloy 25 ToughMet(r) 3 Engine and Pylon Attachments (Alloy): Alloy 25 ToughMet(r) 3 Flight Control Mechanisms (Alloy): Alloy 25 ToughMet(r) 3 Horizontal Stabilizer &
Slide 28: Applications - Medical
28 Applications - Medical Cardiac Rhythm Management (TMI): Electronic Interconnects/Components Niobium/Titanium Electron Beam Weld Insulin Pump (Alloy): EMI Shielding Electrical Terminals in Connectors Mechanical Chips Connector Systems for equipotential grounding Seizure Control (WAM/TFT): Thin Fil
Slide 29: AMTS Operating Locations
29 AMTS Corporate Thin Film Products Electronic Packaging Products Advanced Material Technologies and Services Business Structure Today and Evolving Thin Film Services Shield Cleaning Services Specialty Inorganic Materials Wheatfield, NY Ireland Czech Republic Brewster, NY Buffalo, NY Albuquerque, N
Slide 30: Williams Advanced Materials capabilities
30 Williams Advanced Materials also has broad capabilities in precious and non-precious materials Comprehensive product line High purity / proprietary PVD targets Micro-electronic packaging materials Specialty inorganic chemicals Strong end use markets Data storage Wireless/handsets Semiconductor Op
Slide 31: Key Markets - Wireless and Photonics
31 Key Markets - Wireless and Photonics Thin Film and Packaging materials for varied wireless and photonic applications including RF Power Amplifiers, HBT's, SAW Devices, Light Emitting Diodes (LEDs), Laser Recorders and Micro Electro Mechanical Systems (MEMS)
Slide 32: Key Markets - Semiconductor Wafer Fabrication
32 Key Markets - Semiconductor Wafer Fabrication Thin film materials and chamber services for silicon wafer and UBM (Under Bump Metallization) technologies. Numerous commercial and military microelectronic applications. Under bump metallization
Slide 33: Key Markets - Semiconductor Packaging
33 Key Markets - Semiconductor Packaging High reliability semiconductor packaging materials. Applications focused in space, military and satellite market segments. Solder preforms and clad materials
Slide 34: New Product and Technology Development - Advanced Material Technologies
34 New Product and Technology Development ADVANCED MATERIAL TECHNOLOGIES AND SERVICES Magnetic Media and Head Materials, Eco-Ru(tm) Sputter Targets Under Bump Metallization (UBM) for Flip Chip FCCL Materials Optics Coating Materials Precision Optical Thin Film Coatings (specialty filters) High Value
Slide 35: New Product and Technology Development - Specialty Engineered Alloys
35 New Product and Technology Development SPECIALTY ENGINEERED ALLOYS ToughMet(r) Alloy for High Volume Bearing Applications Cupronickel alloy rod for offshore and marine seawater systems Alloy 390E and Alloy 25BiQ High Performance Copper Beryllium Strip Alloy for Burn in and Test Sockets (BiTS) app
Slide 36: Physical Vapor Deposition (PVD) Process
36 Physical Vapor Deposition (PVD) Process
Slide 37: World's only Fully Integrated Beryllium Producer
37 World's only Fully Integrated Beryllium Producer Bertrandite Ore Mining & Extraction Delta, UT Casting, Rolling & Finishing Elmore, OH Thin Gauge Rolling & Finishing Reading, PA Service & Distribution Centers Global Network New Beryllium Pebbles Plant underway with DoD Title III funding, targeted
Slide 38: Strip Alloy Applications
38 Strip Alloy Applications (strength, conductivity, spring characteristics ... typically 1% to 2% Beryllium) Current Carrying Springs and Relays Integrated Circuitry Sockets Electrical and Electronic Connectors Air Bag Sensors Pressure Responsive Devices Fire Extinguisher Sprinkler Heads EMI shield
Slide 39: Bulk Alloy Applications
39 Bulk Alloy Applications (strength, corrosion resistance, non-galling, conductivity ... typically 1% to 2% Beryllium) Aircraft Bushings Heavy Equipment Bearing and Wear Applications Oilfield well drilling, completion and production equipment Plastic Injection & Blow Molds Power Generation Tooling
Slide 40: ToughMet - a new unique solution
40 Toughmet(r) - a new unique solution for the most challenging wear and load conditions Oil & Gas...deeper drilling...tougher conditions Rotary steering drills Sour well drilling and completion tools Sub-sea control valves Blow-out preventions Heavy equipment ... larger equipment ... critical uptim
Slide 41: Beryllium Products - Applications
41 Beryllium Products - Applications (lightweight, strength, dimensional, stability...typically 40% to 100% Beryllium) - - Optical mirrors for NASA space-based telescopes - - Infrared sensors for fighter jet optical targeting, radar and navigation/guidance systems and special ops (FLIR) -Structural
Slide 42: Technical Materials, Inc. - engineered strip metals
42 Technical Materials, Inc. - solving customers' problems with engineered strip metals Mill Products Specialty cladding and inlay Electron beam welding of dissimilar materials Profiling shapes by milling and/or grinding Close tolerance rolling Electroplating Precious and non-precious metals Overall
Slide 43: BEM - Execution Initiatives
43 BEM - Execution Initiatives Profitable organic growth through new products, new applications, and new services Close collaboration with customers Expansion of international base and sales Broaden markets and technology Leverage above through "smart" acquisitions No let up in manufacturing excelle
Slide 44: Annual Revenue
44 Annual Revenue Our diversification and value creation initiatives are leading to strong growth in revenue and profitability Growth % +24% -16% -21% +8% +24% +9% +41% +25% -5% -21% +75% Telecom Crash Global Economic Recession - - acquisitions 26%
Slide 45: Ongoing value creation initiatives
45 Our ongoing value creation initiatives are focused in three key areas Growth Expanding and diversifying the revenue base Targeting profitable niche growth applications in growing markets New product innovation and service Ongoing global expansion Strategic acquisitions, fast accretion Margin Impr
Slide 46: Strategic Highlights
46 Strategic Highlights The Company is well positioned; strong balance sheet and revolver capacity to operate in this severe economic environment and to take advantage of strategic opportunities as they arise Strong, diverse set of markets served Global market reach New products and services ... a c
Slide 47: Vision · Mission · Values
Vision · Mission · Values 47 Vision We will be a leader in creating innovative engineered material solutions and services that make our customers competitive in global markets Mission ...in support of our vision: We bring value to our customers, globally, through innovative technology, service, and
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