Vat Group Ag · SIX:VACN
Vat — FY2017 Earnings Presentation
34 slides from Vat's earnings presentation, Mar 12, 2018
Slide 1: Fourth quarter and full-year 2017 results
F ourt h quart er and f ul l -year 2017 resul t s F OURTH Q UARTER AND F ULL -Y EAR 2017 R ESULTS No. 1 global market position in high-end vacuum valve technology March 12, 2018 1
Slide 2: Agenda
PASSION. PRECISION. PURITY. Agenda F ourt h quart er and f ul l -year 2017 resul t s 1 Highlights Heinz Kundert, CEO 1 2 Fourth quarter and full-year 2017 financial results Andreas Leutenegger, CFO 3 Strategic drivers and outlook for 2018 Mike Allison, CEO 2 1 until March 12, 2018 2 effective March
Slide 3: Record 2017 results on growing demand and expanding no. 1 global market position
PASSION. PRECISION. PURITY. Record 2017 results on growing demand and expanding no. 1 global market position F ourt h quart er and f ul l -year 2017 resul t s Seven consecutive Expansion of leadership § Record performance quarters of growth on a position in vacuum valves driven by strong year-on-yea
Slide 4: Strong performance supported by all market segments
PASSION. PRECISION. PURITY. Strong performance supported by all market segments F ourt h quart er and f ul l -year 2017 resul t s VAT Group AG Valves Global Service Industry (80%) (14%) (6%) Segment (% of total net sales) Net sales CHF 692m / +36% CHF 554m / +40% CHF 99 / +21% CHF 40m / +26% Adj. EB
Slide 5: Key growth trends for VAT continued to drive business development
PASSION. PRECISION. PURITY. Key growth trends for VAT continued to drive business development Semiconductors Displays Solar Industry & Research F ourt h quart er and f ul l -year 2017 resul t s Picture Picture Picture End-market growth trend 2017 vs. 2016 § Investments in § Transition to OLED § Inve
Slide 6: VAT's three growth dimensions delivered results
PASSION. PRECISION. PURITY. VAT’s three growth dimensions delivered results F ourt h quart er and f ul l -year 2017 resul t s 1st Dimension 2nd Dimension 3rd Dimension End market Equipment Vacuum valve growth growth growth § End markets growing at § Volume § Shift into vacuum unprecedented speed § T
Slide 7: No. 1 market position further expanded
PASSION. PRECISION. PURITY. No. 1 market position further expanded Market share all industries 1 Market share semi & related 2 Market share semi 3 F ourt h quart er and f ul l -year 2017 resul t s Total vacuum valve market size Total vacuum valve market size Total vacuum valve market size 2015: USD
Slide 8: VAT market share all industries
PASSION. PRECISION. PURITY. VAT Market share all industries 1 Market share all industries 1 F ourt h quart er and f ul l -year 2017 resul t s Total Vacuum Valves market size 45% 2014: USD 767m 2015: USD 804m 2016: USD 977m 2017: USD 1’200m 2014 2015 2016 2017 25% 6% 5% 5% 4% 4% 3% 3% other Source: V
Slide 9: Agenda
PASSION. PRECISION. PURITY. Agenda F ourt h quart er and f ul l -year 2017 resul t s 1 Highlights Heinz Kundert, CEO 1 2 Fourth quarter and full-year 2017 results Andreas Leutenegger, CFO 3 Strategic drivers and outlook for 2018 Mike Allison, CEO 2 1 until March 12, 2018 2 effective March 13, 2018 9
Slide 10: Full-year 2017 – Group key figures
PASSION. PRECISION. PURITY. Full-year 2017 – Group key figures F ourt h quart er and f ul l -year 2017 resul t s Adj. EBITDA margin Third party net sales Adj. EBITDA 31.1% (unchanged) CHF 692 m CHF 215 m +36% +36% EBIT margin 25.8% (+2.5pp) Free cash flow Net debt/EBITDA Free cash flow margin 16% 0.
Slide 11: Full year order intake in line with sales increase
PASSION. PRECISION. PURITY. Full year order intake in line with sales increase; Q4 order development not indicative of fundamentals in CHF million F ourt h quart er and f ul l -year 2017 resul t s 736 Full-year 2017 +31% 562 Q4 2017 168 +11% 186 166 122 2016 2017 Q4 order intake Full-year order inta
Slide 12: Strong full-year net sales increase; adj. EBITDA margin flat
PASSION. PRECISION. PURITY. Strong full-year net sales increase; adj. EBITDA margin flat despite significant investments in future growth in CHF million F ourt h quart er and f ul l -year 2017 resul t s 31.1% adj. EBITDA margin 31.1% 692 +36% 508 199 215 143 158 2016 2017 Q4 net sales Full-year net
Slide 13: Net sales bridge
PASSION. PRECISION. PURITY. Net sales bridge F ourt h quart er and f ul l -year 2017 resul t s 100 692 (12) (1) 97 508 2016 Volume Product mix Price FX 2017 § Volume and product mix increases both drive top line growth § Negative price impact only due to volume rebates to large customers 13
Slide 14: Full-year 2017 net sales
PASSION. PRECISION. PURITY. Full-year 2017 net sales CHF 692 million F ourt h quart er and f ul l -year 2017 resul t s Net sales by segment Net sales by region 80% Valves 51% Asia 33% North America 14% Global Service 6% Industry 16% EMEA 14
Slide 15: Valves – 80% of net sales
PASSION. PRECISION. PURITY. Valves – 80% of net sales in CHF million Q4 2017 Q4 2016 Change Semiconductors F ourt h quart er and f ul l -year 2017 resul t s Order intake 152.7 139.7 9.3% § Record results driven by demand for etch and Net Sales 159.7 116.4 37.2% deposition wafer fabrication equipment
Slide 16: Global Service – 14% of net sales
PASSION. PRECISION. PURITY. Global Service – 14% of net sales in CHF million Q4 2017 Q4 2016 Change Growing installed base spurs F ourt h quart er and f ul l -year 2017 resul t s Order intake 21.5 20.9 2.9% substantial growth Net Sales 28.6 20.4 40.2% § Ongoing investments in manufacturing capacity
Slide 17: Industry – 6% of net sales
PASSION. PRECISION. PURITY. Industry – 6% of net sales in CHF million Q4 2017 Q4 2016 Change Investments in future growth F ourt h quart er and f ul l -year 2017 resul t s Order intake 11.6 7.5 54.7% § Accelerated growth in net sales to third parties, Net Sales 10.8 5.9 83.1% combined with rising in
Slide 18: Substantially reduced finance cost impacted by non-cash unwinding cost
PASSION. PRECISION. PURITY. Substantially reduced finance cost negatively impacted by non-cash cost of unwinding finance structure in CHF million 2017 2016 Change F ourt h quart er and f ul l -year 2017 resul t s EBIT 178.7 118.3 51.1% Finance net -44.1 -30.4 45.0% EBT 134.7 87.9 53.2% Income tax ex
Slide 19: Unwinding of the finance structure and impact on 2017 income statement
PASSION. PRECISION. PURITY. The unwinding of the finance structure and its impact on 2017 consolidated income statement Old structure Simplified structure § Unwinding of financing structure set up by the F ourt h quart er and f ul l -year 2017 resul t s 100% former private equity owners VAT Group AG
Slide 20: Investments in growth impacted free cash flow
PASSION. PRECISION. PURITY. Investments in growth impacted free cash flow Free cash flow Free cash flow conversion F ourt h quart er and f ul l -year 2017 resul t s 88% 86% 156 (47) +6% +158% 146 (18) 128 109 -15% 51% 2016 2017 2015 2016 2017 Cash flow from operating activities Cash flow from invest
Slide 21: Year-end net debt further reduced
PASSION. PRECISION. PURITY. Year-end net debt further reduced Net debt development Year-end leverage development F ourt h quart er and f ul l -year 2017 resul t s 2161 (72) 1.9x2 +10% +25% 1971 (63) 144 134 +7% 0.9x 0.7x December 31, 2015 December 31, 2016 December 31, 2017 Gross debt Cash and cash
Slide 22: Initiatives to mitigate the foreign exchange exposure
PASSION. PRECISION. PURITY. Initiatives to mitigate the foreign exchange exposure FX Status on FX exposure initiatives F ourt h quart er and f ul l -year 2017 resul t s § Ongoing initiative to increase global sourcing (mainly Asia and Eastern Europe) USD § Nomination of debt in USD § FX hedging of u
Slide 23: VAT's financial mid-term guidance
PASSION. PRECISION. PURITY. VAT’s financial mid-term guidance Mid-term guidance (amended to former guidance at time of IPO) F ourt h quart er and f ul l -year 2017 resul t s § Net sales growth: high single digit over the cycle at constant FX rates § EBITDA margin target: 33% of sales by 2020 § Effec
Slide 24: Agenda
PASSION. PRECISION. PURITY. Agenda F ourt h quart er and f ul l -year 2017 resul t s 1 Highlights Heinz Kundert, CEO 1 2 Fourth quarter and full-year 2017 results Andreas Leutenegger, CFO 3 Strategic drivers and outlook for 2018 Mike Allison, CEO 2 1 until March 12, 2018 2 effective March 13, 2018 2
Slide 25: VAT's growth drivers remain intact – data generation continues to grow
PASSION. PRECISION. PURITY. VAT’s growth drivers remain intact – data generation continues to grow exponentially A city of 1 million people is expected to generate 200m GB of F ourt h quart er and f ul l -year 2017 resul t s data per day by 20201 Smart Smart Public safety Autonomous Smart Social fac
Slide 26: Strong growth forecast for the IC market with reduced cyclicality
PASSION. PRECISION. PURITY. Strong growth forecast for the IC market with reduced cyclicality 1'400 F ourt h quart er and f ul l -year 2017 resul t s 50% 1'200 40% 1'000 30% 20% 800 10% 600 0% 400 -10% -20% 200 -30% - -40% 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 20
Slide 27: Capital intensity is increasing across all WFE markets
PASSION. PRECISION. PURITY. Capital intensity is increasing across all WFE markets Market NAND 2 DRAM 2 Logic 2 Display 3 F ourt h quart er and f ul l -year 2017 resul t s segments1 ~425% ~100% ~60% ~40% Planar 3D 25nm <16nm 28nm <7nm LCD OLED Technologies • Etching incl. ALE • Etching • Etching • O
Slide 28: Driving share gains through customer intimacy and trusted partnerships
PASSION. PRECISION. PURITY. Driving share gains through customer intimacy and trusted partnerships § Strong key account teams § Focus on integration, software, F ourt h quart er and f ul l -year 2017 resul t s § Industry leading applications and modules and controls engineering capabilities § Joint
Slide 29: Leveraging our core competencies to exceed industry requirements
PASSION. PRECISION. PURITY. Leveraging our core competencies to exceed industry requirements VAT Relevance to F ourt h quart er and f ul l -year 2017 resul t s core competencies industry segments Semi Display Solar R&D Technology enablers Sealing technology üüü üüü üü üüü Contamination management (z
Slide 30: Priorities for 2018 and beyond
PASSION. PRECISION. PURITY. Priorities for 2018 and beyond – Harvest the incredible market opportunities F ourt h quart er and f ul l -year 2017 resul t s Drive innovation Trusted partnership Organization and across all market with customers – solve people development segments their biggest problems
Slide 31: Conclusion & Outlook 2018
PASSION. PRECISION. PURITY. Conclusion & Outlook 2018 F ourt h quart er and f ul l -year 2017 resul t s § The era of Big Data, augmented by rapid advances in artificial intelligence (AI), is gaining momentum, leading the company into a new phase of sustainable growth § Leading market position in vac
Slide 32: Q&A Session
F ourt h quart er and f ul l -year 2017 resul t s F OURTH Q UARTER AND F ULL -Y EAR 2017 R ESULTS Q&A Session August 25, 2016 32
Slide 33: Information
PASSION. PRECISION. PURITY. Information F ourt h quart er and f ul l -year 2017 resul t s Investor information Contact information Listing: SIX Swiss Exchange Michel Gerber Currency: CHF Head of Corporate Communications & Ticker symbol: VACN Investor Relations ISIN: CH 031 186490 1 Phone: +41 81 772
Slide 34: Forward looking statements
PASSION. PRECISION. PURITY. Forward looking statements F ourt h quart er and f ul l -year 2017 resul t s Forward-looking statements contained herein are qualified in their entirety as there are certain factors that could cause results to differ materially from those anticipated. Any statements conta