Penguin Solutions, Inc. · NASDAQ:PENG
Penguin Solutions — Cowen 50th Annual Technology, Media & Telecom Conference (June 2022)
23 slides from Penguin Solutions's conference presentation, Jun 1, 2022
Slide 1: SGH - A Platform for Growth
SGH - A PLATFORM FOR GROWTH NASDAQ: SGH JUNE 2022
Slide 2: Agenda
01 Our Transformational Growth AGENDA 02 How We Got Here 03 The Results 04 Where We’re Going 2
Slide 3: SGH at a Glance
SGH at a Glance Powering growth. Expanding possibilities. SGH 1988 NASDAQ Year Founded SGH is a technology holding company with three lines of business: Intelligent Platform Solutions, Memory Solutions, and LED Solutions ‒ all focused on serving our ~4,000 $1.5B customers by delivering advanced Empl
Slide 4: What We Set Out To Do
What We Set Out To Do § Diversify our businesses § Increase our SAM § Build a diverse experienced leadership team § Revitalize our brand with a new purpose and mission § Focus on execution § Invest in Environment, Social, and Governance Programs 4
Slide 5: Our Lines of Business
Our Lines of Business Our diverse businesses design and manufacture technologies that support and advance the world. Intelligent Platform Solutions Memory Solutions LED Solutions Accelerating the digital transformation Enabling high performance computing Providing application-optimized LED with the
Slide 6: Expanding Serviceable Addressable Market (SAM)
Expanding Serviceable Addressable Market (SAM) SGH Total SAM1 has increased by ~$17B in the past 4 years Intelligent Platform Solutions Memory Solutions LED Solutions ~$12B SAM2 ~$8B SAM3 ~$4.5B SAM4 June 2018 – July 2019 Pre – 2018 March 2021 ~$25B CUMULATIVE SAM 1. $17B incremental SAM represents
Slide 7: Some of Our Valued Partners
Some of Our Valued Partners Expanding position in existing markets with defensible value proposition Intelligent Platform Solutions Memory Solutions LED Solutions Single Board Single Board Computers VME Computers © 2022 SGH Confidential ― Limited Access and Use | 7
Slide 8: How We Got Here
HOW WE GOT HERE 8
Slide 9: Our Team
Our Team MARK ADAMS JACK PACHECO KEN RIZVI President & CEO COO of SGH Senior Vice & President, President & Chief SMART Modular Financial Officer Technologies CLAUDE DEMBY Kiwan Kim Anne Kuykendall Senior Vice Executive Vice President President & Vice President General Counsel President, CreeLED of E
Slide 10: Our Operating System
Our Operating System Quality Corporate Supply Culture/ Chain As a holding company invested in the Human Excellence Capital long term, we support our businesses so they’re always running at their best and SGH empowered to consistently and efficiently Operating System deliver for our customers. Global
Slide 11: Our Acquisition Model
Our Acquisition Model When we look for a business that fits our model, we pay attention to: Compete in high- Serve strategic Leverage our Create Embody SGH value specialty customers proven operating shareholder corporate culture markets and partners system value and values 11
Slide 12: The Results
> >THE RESULTS SGHI
Slide 13: Driving Revenue Growth and Diversification
Driving Revenue Growth and Diversification 8 Quarters of YoY Revenue Growth Revenue Growth Diversification IPS and LED Solutions driving double-digit CAGR Continued diversification strategy beyond Memory Solutions $800 $700 $600 1 nuali z ed CAGR 5% An $500 $400 2 18% 15% 24% 24% $300 FY FY FY Q2 FY
Slide 14: Strong Momentum in Gross Profit and EBITDA
Strong Momentum in Gross Profit and EBITDA LTM Q2 FY22 Adjusted EBITDA: $270M Gross Profit1 Adjusted EBITDA1 > $1.6B in cumulative Gross Profit since FY 16 > $900M in cumulative Adjusted EBITDA since FY 16 ~7.3x Adjusted EBITDA growth from Q2 FY16 – Q2 FY22 $140 $100 $120 2 GR 3 ed CA $80 d C AGR An
Slide 15: The Proof: SGH Then and Now
The Proof: SGH Then and Now FY 2016 Q2 FY 2022 Other US LED 3% 20% 24% Other Memory 16% USA FY Diversification Solutions 2016A Brazil 46% FY 2016A Asia 27% Memory Intelligent Platform Q2 2022A Memory Brazil Q2 2022A 35% 100% Solutions ~58% Solutions 27% Asia Europe 5% 18% 58% 15% Europe 7% FY2016 Re
Slide 16: What We Did
What We Did ü Diversify our businesses ü Increase our SAM ü Build a diverse experienced leadership team ü Revitalize our brand with a new purpose and mission ü Focus on execution ü Invest in Environment, Social, and Governance Programs 16
Slide 17: Where We Are Going
WHERE WE ARE GOING 17
Slide 18: What's Next
What’s Next § Grow faster than the market, remaining focused on specialized solutions § Generate higher margins, earnings and, cash flow through disciplined execution § Deliver increasing value to our customers, suppliers, shareholders, and employees 18
Slide 19: Powering Growth. Expanding Possibilities.
POWERING GROWTH. EXPANDING POSSIBILITIES. 19
Slide 20: Appendix
» APPENDIX SGHI
Slide 21: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations (in millions) Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 GAAP gross profit $ 23.3 $ 23.1 $ 30.6 $ 29.9 $ 29.7 $ 37.2 $ 47.4 $ 48.0 $ 57.8 $ 73.0 $ 78.1 $ 82.7 Share-based compensation expense 0.2 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2 0.4 0.
Slide 22: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations (in millions) Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 GAAP gross profit $ 85.1 $ 57.1 $ 43.0 $ 52.3 $ 54.3 $ 51.5 $ 54.2 $ 56.3 $ 52.6 $ 53.5 $ 84.5 $ 117.8 $ 122.2 $ 112.7 Share-based compensation expense 0.5 0.6 0.7 0.7 0
Slide 23: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations (in millions, except per share data) FY 21 Reconciliation of net income and earnings per share (diluted): GAAP net income $ 21.3 Adjustments to GAAP net income: Share-based compensation expense 33.9 Amortization of acquisition-related intangibles 20.3 Change in fair