Slide 1: 3Q 2022 Interim Management Statement
3Q 2022 Interim Management Statement Ray Smets CEO 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 2: Q&A Session at the end of the presentation
Q&A Session at the end of the presentation DK: +45 89 87 50 45 NO: +47 81 50 33 08 US: +1 646 664 1960 UK: +44 20 3936 2999 Participant Access Code: 829975 To ask a question, press ZERO ONE on your telephone keypad. To withdraw your question, press ZERO TWO. Texted question can be submitted using th
Slide 3: Safe Harbor Statement
Safe Harbor Statement This presentation has been prepared by Napatech A/S (the “Company”) solely for information purposes. The presentation does not constitute an invitation or offer to acquire, purchase or subscribe for securities. Certain statements included in this presentation contain various fo
Slide 4: 3Q 2022 IMS Topics
3Q 2022 IMS Topics • YTD Financial Results Summary • Strategic Breakthrough & Commercial Success • Strategic Process Update • Market Outlook 4 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 5: Q3 2022 Financial Results
Q3 2022 Financial Results 5 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 6: YTD Financial Results Summary
YTD Financial Results Summary • YTD Revenue decline of 11% in DKK • YTD Gross Margin is 56% • YTD Staff costs up 12% YoY • YTD EBITDAC negative 34.7mDKK – down 46.8mDKK compared to ’21 • YTD Net Cash Flow is negative 12.8mDKK • Cash and cash equivalents of 27.9mDKK end of Q3 22 compared to 40.6mDKK
Slide 7: Gross Margin Impacts in 2022 Expected to be Temporary
Gross Margin Impacts in 2022 Expected to be Temporary 69-71% Higher Component Costs* *Temporary Reduced 2022 GM • Q3 GM heavily impacted by global shortage of specific Revenue Mix* in 2022 components, which we had Accentuates Lower GM 57-61% to purchase at very high prices. • 2022 OEM revenues are a
Slide 8: Annual Guidance for 2022 Updated
Annual Guidance for 2022 Updated Key Highlights • Market conditions have affected our 2022 revenue growth as we revise Guidance Previous Updated revenue guidance downward by 13%. • Gross Margins are affected by Revenue DKK 195-220m DKK 170-200m abnormally higher costs of a specialized component due
Slide 9: Strategic Breakthrough & Commercial Success
• Strategic Breakthrough & Commercial Success 9 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 10: Napatech Has Been Keenly Focused on Enhancing R&D
Napatech Has Been Keenly Focused on Enhancing R&D Over the Last 18 Months to Capture More Growth Faster • Napatech increased investments in software • We see a large opportunity in fast- development to accelerate feature velocity growing virtual use-cases targeting within this evolving market modern
Slide 11: Napatech's Never Been in a More Strategically Important Position
Napatech’s Never Been in a More Strategically Important Position Napatech has been intensively focused on driving long-term value with highly-innovative FPGA-based SmartNICs and Software 2023-2026 “Lift-Off” Growth From New 2022 Revenue Streams 2021 Expanding Partnerships Execute “Go Big” and Buildi
Slide 12: Lenovo OEM Design Win Partnership Launched to Expand APAC Service Provider Access
Lenovo OEM Design Win Partnership Launched to Expand APAC Service Provider Access • Joint Product Development • Focused on Virtualization Solution • Delivering improved Data Center performance for 5G telecom and Cloud SP’s • Lenovo branded • Napatech designed 12 30 November 2022 COPYRIGHT © 2022 NAP
Slide 13: The 5G Era is Changing Everything in Telecom Infrastructure
The 5G Era is Changing Everything in Telecom Infrastructure • 5G is a massive business • Reducing cost-per-subscriber for challenge for all telcos infrastructure enables significant • Major capital investments in improvements in telco ROI for new spectrum and their 5G deployments infrastructure • UP
Slide 14: AMD/Xilinx Partnership is Starting to Generate Sales Leads
AMD/Xilinx Partnership is Starting to Generate Sales Leads • Launched September 2022 • Sales and marketing collaboration agreement • AMD direct & channel sales activated for Napatech solutions • Targeted accounts in all global geos and customer types • Early mileposts being hit for engagements and m
Slide 15: Intel IPU Partnership
Intel IPU Partnership Microsoft FPGA + CPU • Programmable NICs evolve to include both SmartNICs and IPUs • IPUs build upon SmartNICs, adding general purpose CPU cores • Unlocks new customers, applications and use cases • Napatech and Intel partner to deliver market-leading IPU design • Napatech soft
Slide 16: Landmark Win On Track for Significant 2023+ Revenue Growth
Landmark Win On Track for Significant 2023+ Revenue Growth • Customer: a multi-billion dollar global leader in network and security solutions selling its solutions to the world’s largest enterprises, financial institutions, service providers and governments • Napatech delivering it’s newest Intel FP
Slide 17: Strategic Process Update
• Strategic Process Update 17 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 18: Strategic Process Update
Strategic Process Update • Napatech is well positioned amongst others within this market with its FPGA- based SmartNIC HW and SW solution. • Napatech has had inbound interest from several large players within our market domain. • Napatech’s Board announced in Q3 that we initiated a strategic review
Slide 19: Market Outlook
• Market Outlook 19 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 20: Napatech is Addressing Highest Growth Segment of the Industry of Programmable NICs
Napatech is Addressing Highest Growth Segment of the Industry of Programmable NICs Server shipment forecast Ethernet adapter revenue forecast Server shipments to grow at 5% CAGR out to CY26 SmartNICs Revenue to grow at 31% CAGR out to CY26 Market Share EoY’21 SmartNICs - Server Vendors Only* Share G
Slide 21: Industry Insiders Take Notice
Industry Insiders Take Notice Light Reading Article Found Here 21 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S
Slide 22: Q&A Session at the end of the presentation
Q&A Session at the end of the presentation DK: +45 89 87 50 45 NO: +47 81 50 33 08 US: +1 646 664 1960 UK: +44 20 3936 2999 Participant Access Code: 829975 To ask a question, press ZERO ONE on your telephone keypad. To withdraw your question, press ZERO TWO. Texted question can be submitted using th
Slide 23: Consolidated Income Statement Q3 & YTD 2022
Consolidated Income Statement Q3 & YTD 2022 Q3 YTD Q3 YTD Key Highlights DK K '000 2022 2021 2022 2021 ∆ ∆ • Revenue in Q3 down 22% compared to Revenue 36,976 47,247 124,697 140,479 -22% -11% Q3’21. Revenue YTD in USD down 21% Cost of goods sold (18,730) (12,699) (54,858) (39,808) compared to ‘21 (d
Slide 24: Consolidated Cash Flow Statement Q3 & YTD 2022
Consolidated Cash Flow Statement Q3 & YTD 2022 Q3 YTD DK K '000 2022 2021 2022 2021 Key Highlights Earnings befo re tax ( EBT) ( 12,680) 7,941 ( 30,632) 19,663 • Net Cash flow from operating activities in Q3 Adjustments to reconcile profit before tax to net cash flows 7,390 5,390 19,189 12,537 negat
Slide 25: Thank You
Q3 Thank You 25 30 November 2022 COPYRIGHT © 2022 NAPATECH A/S