Infineon Technologies Ag · XETR:IFX

Infineon Technologies — Q3 FY2014 Earnings Presentation

34 slides from Infineon Technologies's earnings presentation, Jul 30, 2014

  1. Slide 1: Third Quarter FY 2014 Quarterly Update

    Third Quarter FY 2014 Quarterly Update Infineon Technologies AG Investor Relations

  2. Slide 2: Table of Contents

    Table of Contents  Infineon at a Glance  Growth Drivers  Results and Outlook Disclaimer: This presentation contains forward-looking statements about the business, financial condition and earnings performance of the Infineon Group. These statements are based on assumptions and projections resting

  3. Slide 3: Average Cycle Financial Targets

    Average Cycle Financial Targets Historical Going forward CAGR(99-13) = ~8% Revenue Growth: FY99 FY02 FY04 FY06 FY08 FY10 FY12 FY14e ~8% 20% 15% 14.4% Segment Result Margin: 10% 5% 0% FY10 FY11 FY12 FY13 FY14e ~15% 25% 20% 15% 15.1% Investment-to-Sales: 10% 5% 0% FY09 FY10 FY11 FY12 FY13 FY14e ~13% 2

  4. Slide 4: Revenue Split by Division

    Revenue Split by Division Q3 FY 2014 revenue: EUR 1,110m ATV IPC €510m €200m Courtesy: BMW CCS PMM €123m €271m OOS+C&E* €6m * Other Operating Segments; Corporate and Eliminations. 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved. Page 4

  5. Slide 5: Tight Customer Relationships are Based on System Know-how and App Understanding

    Tight Customer Relationships are Based on System Know-how and App Understanding ATV IPC PMM CCS EMS partners Distribution partners 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved. Page 5

  6. Slide 6: Infineon Holds Top Positions in All Major Product Categories

    Infineon Holds Top Positions in All Major Product Categories Automotive Power Smart card ICs semiconductors semiconductors total market in 2013: total market in 2013: total market in 2012: $2.48bn $25.1bn $15.0bn Renesas 13.3% Infineon 11.8% NXP 32.3% Infineon 9.6% Toshiba 7.0% Infineon 21.7% STMicr

  7. Slide 7: Table of Contents

    Table of Contents  Infineon at a Glance  Growth Drivers  Results and Outlook 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved. Page 7

  8. Slide 8: Growth in Car Production and Content-per-Car Continues Unabated

    Growth in Car Production and Content-per- Car Continues Unabated Global car production (cars ≤ 6t) Semiconductor value per car [units m] [USD] CAGR(13-17) = 3.6% World 357 CAGR 324 +2.5% +3.7% 97.6 94.0 90.9 7.0 84.7 87.8 6.6 5.8 6.4 7.8 221 CAGR 6.0 8.3 7.9 Brazil 9.1 14.8 197 +2.9% 9.0 14.2 12.7 1

  9. Slide 9: In 2013, Infineon Gained Market Share in All Addressed Product Categories

    In 2013, Infineon Gained Market Share in All Addressed Product Categories 2013 automotive semiconductor  “Power” and “Sensors” were the fastest market by product category ($25.1bn) growing product categories with 8% and 7% growth y-y, respectively. Processor Power 25%  Infineon remained market lea

  10. Slide 10: Infineon's Basic LED Driver Family Powers Rear LED Lighting of Audi S1

    Infinon‘s Basic LED Driver Family Powers Rear LED Lighting of Audi S1  Rear lighting solution developed as part of our long-running partnership with Audi.  Infineon‘s Basic LED drivers already shipping in volume and are expected to ramp in the coming quarters as OEMs increasingly use LEDs for exte

  11. Slide 11: Wide Adoption of Premium Features, ADAS and CO2 Reduction Drive ATV's Growth

    Wide Adoption of Premium Features, ADAS and CO2 Reduction Drive ATV‘s Growth Vehicle Semiconductor content per car production Comfort, Premium ADAS CO2 reduction Courtesy: Bosch Courtesy: Bosch Courtesy: BMW ~4% p.a. 2 – 4% p.a. ATV: ~8%* p.a. * Targeted growth rate of ~8% reflects ATV’s expectation

  12. Slide 12: Drives, Home Appliances and Others Show Strongest Growth Rates

    Drives, Home Appliances and Others Show Strongest Growth Rates Home Drives Renewables Traction Others Appliances ~10% p.a. > 5% p.a. ~5% p.a. > 10% p.a. > 10% p.a. IPC: ~10% p.a. 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved. Page 12

  13. Slide 13: Infineon is Samsung's Partner of Choice for RF Components in its Flagship Smartphone

    Infineon is Samsung‘s Partner of Choice for RF Components in its Flagship Smartphone Infineon’s RF components in Samsung Galaxy S5  Infineon supports Samsung‘s flagship smartphone model Galaxy S5 with up to eight RF components:  multiple SiGe low-noise amplifiers (LNAs) for boosting LTE data rates

  14. Slide 14: PMM Aims to Outgrow Its Core Markets

    PMM Aims to Outgrow Its Core Markets Power Management Mobile Communications Computing Charger Lighting Mobile devices Cell. infrastructure TAM: > 7% p.a. TAM: > 7% p.a. PMM: ~10%* p.a. * Targeted growth rate of ~10% reflects PMM’s expectation that its strong competitive positioning will lead to mark

  15. Slide 15: Strong Growth in Payment Business and also in Multiple Implementations of NFC

    Strong Growth in Payment Business and also in Multiple Implementations of NFC Infineon’s main NFC offerings on the rise Strong momentum for Infineon’s payment business embedded SE in SIM card  Successful introduction and ramp of SLE 77-based products in 90nm technology.  Payment business grew by ~

  16. Slide 16: Growth in CCS Driven by All Application Segments

    Growth in CCS Driven by All Application Segments High-end Mobile Government Embedded Payment Communication Identification Security Expected growth [pieces] ~30% ~15% ~15% ~20% CCS: 6-9% p.a. Sources: IHS, ABI Research, Infineon. 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserv

  17. Slide 17: Expected Growth Broadly In Line With Historical Averages

    Expected Growth Broadly In Line With Historical Averages ATV IPC PMM CCS Courtesy: BMW Courtesy: Bosch Rexroth ~8% p.a. ~10% p.a. ~10% p.a. 6-9% p.a. Infineon: ~8% p.a. Sources: IHS, Strategy Analytics, ABI Research, Infineon. 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved

  18. Slide 18: Table of Contents

    Table of Contents  Infineon at a Glance  Growth Drivers  Results and Outlook 2014-07-30 Copyright © Infineon Technologies AG 2014. All rights reserved. Page 18

  19. Slide 19: Q3 FY14 Is Fifth Consecutive Quarter of Year-On-Year Growth

    Q3 FY14 Is Fifth Consecutive Quarter of Year-On-Year Growth Revenue and Segment Result [EUR m] +9% FY 2013 revenue split by product category 1.110 1.053 1.051 1.022 984 11% 14% 12% 14% 15% Power embed. Control RF others 117 148 116 146 170 Q3 FY13 Q4 Q1 FY14 Q2 Q3 FY14 Revenue Segment Result Segment

  20. Slide 20: Strong Growth in ATV, Margins in IPC Fully Recovered

    Strong Growth in ATV Margins in IPC Fully Recovered ATV IPC PMM CCS [EUR m] [EUR m] [EUR m] [EUR m] +11% 510 484 459 455 452 +2% +16% 266 271 271 252 238 197 200 +3% 173 179 185 17% 18% 17% 11% 13% 12% 14% 14% 12% 15% 119 129 108 121 123 8% 17% 15% 18% 20% 9% 7% 8% 8% 6% 52 57 55 66 70 13 33 33 40 4

  21. Slide 21: Guidance for Q4 FY14 and FY 2014

    Guidance for Q4 FY14 and FY 2014 Outlook Q4 FY14 Outlook FY 2014 (compared to Q3 FY14) (compared to FY 2013) Increase between Slightly above 11%. Revenue (previously: “at least at 3% and 7%. high end of 7-11% range”) Segment Slightly above 14%. Between Result (previously: “at least at 15% and 17%. M

  22. Slide 22: Investment-to-Sales Ratio Will Drop From ~15% in the Past to ~13% in the Future

    Investment-to-Sales Ratio Will Drop From ~15% in the Past to ~13% in the Future Investments and Investment-to-Sales Ratio [EUR m]  catch-up after downturn  lower capital intensity 300mm  pre-investments 300mm versus 200mm 1000  growth for FY11 – FY14  increasing FE outsourcing share 20%  incre

  23. Slide 23: Dividend Payments Will Rise by 4 to 6 €-Cents as Early as FY14

    Dividend Payments Will Rise by 4 to 6 €-Cents as Early as FY14 Dividend payments [€-Cents] 16 - 18  Investment-to-sales ratio reduced from ~15% to ~13%.  Higher sustainable 12 12 12 level of Free Cash 10 Flow frees up more cash for increased dividends. FY10 FY11 FY12 FY13 FY14e 2014-07-30 Copyrigh

  24. Slide 24: Infineon

    Cinfineon Innovative semiconductor solutions for energy efficiency, mobility and security.

  25. Slide 25: Opex-to-Sales-Ratio Well Within Target Range

    Opex-to-Sales-Ratio Well Within Target Range S, G&A1) R&D2) [EUR m] 139 140 141 140 133 136 15% 121 122 120 115 115 114 14% 100 80 13% 60 12% 40 11% 20 0 10% Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 FY13 FY14 FY13 FY14 General & Administration Selling R&D % of sales 1) Target range for SG&A: „Low teens percent

  26. Slide 26: DOI, DSO and DPO in Line With Our Targets

    DOI, DSO and DPO in Line With Our Targets Working capital* Inventories [EUR m] [EUR m] 654 674 680 [days] Q3FY13 Q4 Q1 FY14 Q2 Q3 589 609 100 0 600 80 -16 400 60 -50 -25 40 200 -75 20 -100 -92 0 0 -123 Q3 FY13 Q4 Q1 FY14 Q2 Q3 -150 Inventories DOI* Trade receivables Trade payables [EUR m] [days] [EU

  27. Slide 27: Investments Peaked in FY12, D&A Still Increasing

    Investments Peaked in FY12, D&A Still Increasing Investments* D&A [EUR m] 1000 30% 887 890 800 ~650 20% 600 15.1% ~500 15.1% 466 453 428 378 11.9% 364 400 11.6% 325 144 336 10% 131 200 154 126 115 129 120 0 0% FY09 FY10 FY11 FY12 FY13 FY14e FY09 FY10 FY11 FY12 FY13 FY14e Q1 Q2 Q3 Fiscal Year Guidanc

  28. Slide 28: Gross Cash and Net Cash Have Increased

    Gross Cash and Net Cash Have Increased Liquidity Development [EUR m] Gross Cash Debt Equity-linked Net Cash 108 38 0 0* 105 195 193 188 190 200 2286 2137 1832 1983 2279 2048 2198 2010 2263 2073 Q3 Q4 Q1 Q2 Q3 FY13 FY14 * The remaining outstanding convertible bonds were converted by the end of Januar

  29. Slide 29: Total Gross Capital Returns of EUR 851m Between FY 2011 and FY 2014

    Total Gross Capital Returns of EUR 851m Between FY 2011 and FY 2014 Total gross capital returns history [EUR m]  In November 2013, a new 687 EUR 300m capital returns program with a maturity 350 until September 2015 was 308 300 started.  Per 30 June 2014, put 250 109 options for buyback of 212 10.5

  30. Slide 30: Target: 'RoCE Above WACC' Over the Cycle

    Target: 'RoCE Above WACC' Over the Cycle RoCE* history WACC: low teens % 30% FY12: 22% 20% 27% 24% 27% 25% 20% 27% FY13: 14% 21% 10% 16% 17% 5% 7% 0% Q1 FY12 Q2 Q3 Q4 Q1 FY13 Q2 Q3 Q4 Q1 FY14 Q2 Q3 Capital Employed* history 2,500 [EUR m] 2,035 2,239 2,274 2,216 2,159 2,194 2,232 2,327 1,760 1,889 2,

  31. Slide 31: Notes

    Notes Investments = 'Purchase of property, plant and equipment' + 'Purchase of intangible assets and other assets' incl. capitalization of R&D expenses Capital Employed = 'Total assets' Please note: All positions in ' ' refer to the – 'Cash and cash equivalents' respective accounting position and –

  32. Slide 32: Infineon is a Long-standing Member of Europe's Leading Sustainability Indices

    Infineon is a Long-standing Member of Europe's Leading Sustainability Indices Infineon’s most recent achievements  October 2013: oekom research has classified Infineon as „Prime“, which serves as an indicator of the  January 2014: Infineon is quality of Infineon’s listed in the Sustainability perf

  33. Slide 33: Financial Calendar

    Financial Calendar Date Location Event 17 Sep 2014* Conference Call by Jochen Hanebeck, Division President Automotive 23 Sep 2014 Munich Baader Investment Conference 24 Sep 2014 Berenberg Bank and Goldman Sachs German Munich Corporate Conference 19 – 20 Nov 2014 Barcelona Morgan Stanley TMT Conferen

  34. Slide 34: Institutional Investor Relations Contact

    Institutional Investor Relations Contact Ulrich Pelzer Corporate Vice President  +49 89 234-26153 Finance, Treasury &  ulrich.pelzer@infineon.com Investor Relations Joachim Binder Senior Director  +49 89 234-25649 Investor Relations  joachim.binder@infineon.com Holger Schmidt Manager  +49 89 23

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