Be Semiconductor Industries N.v. · EURONEXT:BESI
Be Semiconductor Industries — Investor Presentation (May 2022)
62 slides from Be Semiconductor Industries's investor presentation, May 2022
Slide 1: Investor Presentation May 2022
INVESTOR PRESENTATION May 2022
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements about management's future expectations, plans and prospects of our business that constitute forward-looking statements, which are found in various places throughout the presentation, including, but not limited to, statements relating to exp
Slide 3: Agenda
Agenda I. Company Overview II. Market III. Strategy IV. Financial Update and Summary V. Appendix May 2022 3
Slide 4: I. Company Overview
I. COMPANY OVERVIEW May 2022 4
Slide 5: Besi Overview
Besi Overview • Leading assembly equipment supplier with #1 and #2 positions in key markets. ~30% addressable market share • Broad portfolio: die attach, packaging and plating Corporate Profile • Strategic positioning in substrate and wafer level packaging • ~75% of systems used for advanced packagi
Slide 6: Company History
Company History 900 70% Consistent Focus on Advanced Packaging Has Created an Industry Leader € 808.5 65% 800 •Focus on most rapidly growing segments of assembly market •Growth organically and via acquisitions •Expanded share of wallet with key industry leaders each cycle 60% 700 •Expansion of custo
Slide 7: History of Superior Long-Term Value Creation
History of Superior Long-Term Value Creation Capital Allocation Strategic/Financial Shareholder Return Superior Total Returns **: Disciplined execution has Attractive capital created leader in • 55% (1 year) allocation program advanced packaging • 357% (3 year) • 498% (5 year) Superior through cycle
Slide 8: Industry Leading Equipment Portfolio
Industry Leading Equipment Portfolio Die Attach (82% of 2021 Revenue) Direct Lid Embedded Thermo Hybrid Multi-Module Attach Epoxy / Soft Solder Flip-chip Attach Bridge Attach Compression Bonding • 2200 evo • 2100 hS • 2009 SSI • 8800 CHAMEO advanced / PLP • 2200 evo plus • 2100 hS i • 2100 SSI New •
Slide 9: Customer Ecosystem
Customer Ecosystem Customers OEMs End Products IDMs Subcontractors • Diversified, blue chip customer base, top 10 = ~53% of 2021 revenue • Leading IDMs and subcontractors. 55%/45% order split in 2021 • Also supply leading fabless companies: Qualcomm, AMD, Broadcom, MediaTek via subcontractors • Long
Slide 10: From Processed Wafer to Assembled Chip
From Processed Wafer to Assembled Chip Semiconductor Manufacturing Equipment 2021: $101.2B* Front end: $88.9B Assembly: $6.5B Test: $5.8B (88%) (6%) (6%) Assembly Process Dicing Die Attach Wire Bond Packaging Plating Leadframe Wire Bond - - Substrate Wire bond - - - Substrate Flip chip/TCB - - - Waf
Slide 11: Current Operational Profile
Current Operational Profile (NL) Duiven and ‘s-Hertogenbosch Steinhausen, Radfeld, (AT) (CH) Chandler Suzhou Chengdu Korea Shanghai Leshan Taiwan Shenzhen Sales Office Thailand Philippines Malaysia Production Site Singapore Sales and R&D Site LTM March 31, 2022 Europe/NA Asia • Development activitie
Slide 12: Summary Financials
Summary Financials Long term, step function growth in cyclical business Year Ended December 31, (€ millions, ex share data) 2019 2020 2021 Q1-21 Q1-22 • Increased revenue, profitability and market share per cycle • Peer leading financial metrics Revenue 356.2 433.6 749.3 143.2 202.4 Strong upturn in
Slide 13: Through Cycle Revenue and Gross Margin Trends
Through Cycle Revenue and Gross Margin Trends € millions Revenue Gross Margin Gross Margin 900 70% 800 60% 58.0% 700 51.1% +73% 50% 805 600 500 39.5% 516 40% 593 34.1% 424 400 30% 4 year 379 300 averages 302 351 20% 200 164 10% 100 191 0 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Slide 14: Business Model Objectives
Business Model Objectives Revenue € 1 billion++ Addressable Market Share 40%+ Gross Margin 57-62% Net Margin 30-35% Headcount Split 80% Asia/20% Europe/NA Scope 1 and 2 Emissions 60% reduction Global Energy Needs 65% from renewable sources May 2022 14
Slide 15: Shareholder Friendly Capital Allocation. €1.2 Billion Since 2011
Shareholder Friendly Capital Allocation. €1.2 Billion Since 2011* 300 288.1 Dividends Share Repurchases 18.6 250 209.5 200 35.5 179.5 167.1 150 50.1 € millions 44.7 269.5 100 88.8 91.3 174.0 17.8 23.5 122.4 129.4 50 65.3 73.5 0 2017 2018 2019 2020 2021 2022 17% 27% 19% 28% 26% 74% 83% 73% 81% 72% *
Slide 16: II. Market
II. MARKET May 2022 16
Slide 17: What Drives Besi's Business?
What Drives Besi’s Business? Selection of Timing of Macro GDP IDM and supply customer trends chain partners roadmaps Meeting Performance in Competitive demanding 24/7 production cycle times and technical specs environments scalability May 2022 17
Slide 18: Assembly Equipment Forecast
Assembly Equipment Forecast 8.0 7.2 80% Market Size YoY Growth Rate 71.1% 7.2 7.0 6.5 60% 6.0 4.5 4.5 40% 5.0 US$ billions 25.0% 3.8 4.0 3.2 20% 18.8% 10.8% 3.0 0.0% 0.0% 0% 2.0 -20% 1.0 -28.9% 0.0 -40% 2017 2018 2019 2020 2021E 2022E 2023E Source: Tech Insights, May 2022. Assembly equipment revenue
Slide 19: Industry Upturn Continues in H1-22
Industry Upturn Continues in H1-22 Source: Tech Insights, April 2022 May 2022 19
Slide 20: Assembly Equipment Market Composition
Assembly Equipment Market Composition Assembly Equipment Market (2021) Besi Addressable Market (2021) Plating Wire 1% Inspection, Bonding Dicing,Other 26% 30% Packaging 33% $6.5 billion $2.8 billion Plating 0% Die Attach 66% Packaging 14% Die Attach 29% Source: Tech Insights, May 2022 May 2022 20
Slide 21: Digital Society Drives Greater Computing and Data Needs
Digital Society Drives Greater Computing and Data Needs Technology Drivers 5G AI IoT On the road to augmented intelligence Imaging HD voice Augmented Driverless human processing Audio Motion sensing Olfactometry Disruptive technology Next gen Robot Hyper data Holographic assistant home interaction c
Slide 22: Semiconductor Demand Growing as Everything Gets Smarter
Semiconductor Demand Growing as Everything Gets Smarter Semiconductor 2015 2020 2025E ∆’20-’25E Content/Unit High End Smartphone $100 $170 $275 +61.7% Automotive $310 $460 $690 +50.0% (Global Average) Datacenter Server $1,620 $2,810 $5,600 +99.3% (CPU + Accelerator) Smartphone $2 $4 $9 +125.0% (Glob
Slide 23: Advanced Packaging Critical to Next Generation Applications
Advanced Packaging Critical to Next Generation Applications Growth Drivers Enablers Greater Mobile Revolution miniaturization • Mobile internet • Messaging • Social media Higher Greater • Shared economy accuracy complexity • Gaming • Geo-location • Audio/video Die Bonding and • Auto electronics Pack
Slide 24: Requiring Increased Density, Higher Accuracy and Smaller Form Factors
Requiring Increased Density, Higher Accuracy and Smaller Form Factors for Next Generation Devices Front-End Wafer Fab • Transistor scaling • Lithography • New 3D structures Source: Samsung Source: ASML 2021 Back-End Assembly • More contacts • Smaller pitches • Thinner, denser and more complex packag
Slide 25: Besi Portfolio Well Positioned by Node Size and Accuracy
Besi Portfolio Well Positioned by Node Size and Accuracy Estimated % of 2020 Revenue Typical Application Besi Equipment Accuracy Size 100% Micron NM Die Attach 90% 10+ 28+ Automotive, SiP 25% Packaging Power 80% Plating 70% Die Attach 20% IOT 60% 10 28 Packaging General ICs Plating 50% 40% Computer,
Slide 26: Addressable Market Share Increasing, Particularly in Die Attach
Addressable Market Share Increasing, Particularly in Die Attach 2016 2017 2018 2019 2020 ∆ ‘20/‘19 ∆ ‘20/’16 Assembly Market ($MM) 3,587 4,503 4,391 2,998 3,603 +20.1% +0.4% Besi Market Share 9.9% 13.1%% 11.6% 10.8% 11.4% +0.6pts +1.5pts Addressable Market ($MM) 1,507 1,942 1,850 1,247 1,399 +12.2%
Slide 27: Leader in Addressable Market, Die Attach Market and Advanced Die Placement
Leader in Addressable Market, Die Attach Market and Advanced Die Placement Die Attach Advanced (82% of Revenue) Die Placement** Besi Other 33% 2020 Addressable Market* $911 37% $236 Million Million Other Besi 63% 67% Besi 29% $1.4 Billion Packaging & Plating (18% of Revenue) Other Besi 71% 15% $488
Slide 28: Growth Expected to Favor Besi's Product Portfolio
Growth Expected to Favor Besi’s Product Portfolio, Particularly Die Attach 8,000 CAGR (2020-2023) Die Attach 26.6% 7,229 7,221 7,000 Packaging & Plating 18.7% 6,522 Other Assembly 22.8% 6,000 2,304 2,463 Total 23.4% 1,894 Besi 5,000 Addressable $ millions 1,016 1,015 Market 3,844 954 4,000 1,214 3,0
Slide 29: Growth of Hybrid Bonding Reflects Industry Shift
Growth of Hybrid Bonding Reflects Industry Shift To Smaller, Integrated, Heterogeneous Chip Designs. Besi Has Leading Position Direct Cu-Cu Interconnect Ultra-High Bandwidth & Speed Eliminates need for interposer Results in smaller, thinner form factor Contact density increased by factor of 1000x by
Slide 30: Facilitates New 3D Structures and Growth Of Other Wafer Level Assembly Processes
Facilitates New 3D Structures and Growth Of Other Wafer Level Assembly Processes 2 3 3D Chiplet 5 1 Chiplet Chiplet Hybrid Bond Bridge Die Interposer 6 4 Bridge die Package Substrate 1 2 3 4 5 6 Chip to Wafer TCB Hybrid Bonding High Bandwidth Embedded Bridge Wafer Level HD Interposer to Memory Stack
Slide 31: Hybrid Bonding Adoption Leads to Higher Capital Intensity per UPH
Hybrid Bonding Adoption Leads to Higher Capital Intensity per UPH 8800 FC Quantum 8800 Ultra Accurate Chip to Wafer Hybrid Bonder 3 micron accuracy <200 nanometer accuracy Pricing: $1.5MM-2.5MM ASP: $500k Configuration dependent ~9,000uph ~1,500uph May 2022 31
Slide 32: Estimated Timetable Per Application
Estimated Timetable Per Application 2022 2023 2024 2025 2026 2027 2028 Computing Consumer Servers Datacenters Memory/Mobile PC High performance Laptop Auto/Industrial computing High bandwidth memory Gaming High-end smartphone Artificial Intelligence Autonomous driving Entertainment Smart watch Vehic
Slide 33: Hybrid Die Bonding Market Estimate
Hybrid Die Bonding Market Estimate June 2020 estimate Market tracking towards high case developed in June 2020 • High level of customer engagement • Interest expressed by both logic and memory players • AMD recently announced first hybrid bonded 3D chiplet-based processor • Collaboration with Applie
Slide 34: Besi End-User Markets
Besi End-User Markets Other Other 12% 10% Mobile Internet 39% Mobile Internet Spares/Service Spares/Service 43% 17% 13% 2020 Revenue 2021 Revenue Automotive Automotive 13% 13% Computing Computing 19% 21% Source: Company estimates May 2022 34
Slide 35: Mobile: Besi's Largest End-User Market
Mobile: Besi’s Largest End-User Market Besi Involved in Almost All Components RF Front End Antennas GPS RF Tranceiver Modem Local Connectivity WiFi/NFC Microphone Cameras Application Sensors Processor Display TouchScreen Power Lidar Battery Memory Source: Unitedlex.com and ifixit.com and System plus
Slide 36: Mobile: 5G Adoption Increasing
Mobile: 5G Adoption Increasing Driven By New Smartphone Applications and Features Growing 5G Smartphone Penetration Number of mobile phones sold per year fairly constant at ~1.7 billion of which 80%+ are represented by smart phones Growth driven by new features and innovation: 5G broader spectru
Slide 37: Computing Demand Expanding Rapidly
Computing Demand Expanding Rapidly Data volumes growing Advanced computing expanding to many commercial applications exponentially Information Created, Captured, Copied and Consumed 200 AI/Vision/Recognition Industry 4.0 Zetabytes 181 150 Autonomous 147 Medical Driving 120 100 97 Super Computers Dat
Slide 38: Automotive: Semiconductor Content and Cost per Car Increasing
Automotive: Semiconductor Content and Cost per Car Increasing Growth in Automotive Semiconductors Source: IHS Markit, October 2020 May 2022 38
Slide 39: EV Adoption Will Further Increase Semi Content and Cost/Car
EV Adoption Will Further Increase Semi Content and Cost/Car May 2022 39
Slide 40: III. Strategy
III. STRATEGY May 2022 40
Slide 41: Summary Strategy
Summary Strategy Maintain best in class technology leadership Reward Expand shareholders presence in via capital wafer level allocation assembly policy Strategic Acquire Objectives Increase companies with market complementary presence in technologies addressable and products markets ESG Integration
Slide 42: Strategy Update
Strategy Update • Supply chain constraints and selected component shortages persist both at Besi and at customer manufacturing sites Production • Impacts H1-22 quarterly delivery schedules • Began Hybrid Bonding shipments to customer in Q4-21 • Ramping capacity for 2022/2024 demand • Gross R&D inves
Slide 43: Revenue Growth Initiatives
Revenue Initiatives Pick the winners Expand wafer level assembly engagement New 5G, AI and HPC applications Revenue Growth Increase penetration of Korean and Chinese android markets Initiatives Expand Chinese market presence Wire bonding to flip chip conversion Expand automotive market share May 202
Slide 44: Asian Production Transfer Has Improved Profitability and Cash Flow
Asian Production Transfer Has Improved Profitability and Cash Flow Leading to Lower And Reduced Break Asian Production Has Fixed European and Even Revenue And Improved Cash Significantly Expanded NA Headcount Levels Generation Shipments € millions € millions 2,000 99% 2,000 300 300 278 270 1,730 1,6
Slide 45: Flexible Production Model Has Generated Consistent Gross Margins
Flexible Production Model Has Generated Consistent Gross Margins in Market Cycles Revenue Gross Margin Gross Margin adjusted 250 80% 226.1 208.3 202.4 75% 200 171.7 70% Gross Margin % € millions 150 143.2 124.3 65% 108.3 109.7 100 62.0% 62.1% 61.0% 60.8% 60.4% 60.1% 60% 58.3% 58.2% 56.7% 50 55% 0 50
Slide 46: Flexible Asian Workforce Has Significantly Enhanced Scalability
Flexible Asian Workforce Has Significantly Enhanced Scalability Fixed Headcount 1,800 1,692 1,645 1,686 100% 1,534 1,523 1,600 90% 1,400 80% 1,200 Headcount 73% 70% 70% 70% 70% 70% 1,000 60% 800 50% 600 400 40% 200 27% 30% 30% 30% 30% 30% 0 20% • Increasing fixed headcount to support R&D 2018 2019 2
Slide 47: Structural, Through Cycle Outperformance Achieved vs. Direct Peers
Structural, Through Cycle Outperformance Achieved vs. Direct Peers Return on Average Equity 60.0 Gross Margin Besi Δ 2016 2021 2016/ 50.0 2021 Besi’s margins and ROE have exceeded direct peers through cycles: Besi 51.0% 59.6% +8.6% 40.0 K&S* ASM PT • Investment in business model has 43.4% 43.8% +0.4
Slide 48: Significant ESG Progress Achieved in 2021
Significant ESG Progress Achieved in 2021 Process Pillar Progress Reduced Scope 1 & 2 and 3 emissions intensity by 27% and 4%, respectively Environmental Impact Relative reductions in fuel, energy, hazardous waste and water consumption Launched sustainable design initiatives for die bonding platform
Slide 49: ESG Ambitions and Targets
ESG Ambitions and Targets Key Targets 2022 Key Targets 2030 100% renewable sources for European 65% renewable sources for global energy needs energy needs 15% reduction in Scope 1 and 2 60% reduction in Scope 1 and 2 carbon emissions* carbon emissions* Above-benchmark employee engagement Reduce ener
Slide 50: IV. Financial Update and Summary
IV. FINANCIAL UPDATE AND SUMMARY May 2022 50
Slide 51: Strong Business Execution Keeps Profit Efficiency at High Levels
Strong Business Execution Keeps Profit Efficiency at High Levels Q1-21/Q1-22 Q4-21/Q1-22 Revenue Net Income Revenue Net Income € 202.4 € 202.4 + 17.9% 200 200 + 41.3% € 171.7 € 143.2 Gross Margin Gross Margin 160 58.2% + 1.9 points 60.1% 160 56.7% + 3.4 points 60.1% OPEX OPEX € 34.9 MM + 14.3% € 39.
Slide 52: Liquidity Position Enhanced
Liquidity Position Enhanced 800 Cash and Deposits Net Cash Q1-22 vs. Q4-21 696.6 700 672.2 • Total cash up € 24.4 million (3.6%) • +€ 45.0 million cash flow from operations 598.7 • - € 14.1 million share repurchases 600 • - € 5.7 million capitalized development 527.8 500 475.5 • Net cash of € 407.0
Slide 53: Guidance Q2-22 & H1-22
Guidance Q2-22 & H1-22 € in millions Revenue Gross Margin Total Operating Expenses Q2-22 € 202.4 +10% (+/- 5%) 60.1% 59%-61% € 39.9 Flat to -5% Q1-22 Q2-22 Q1-22 Q2-22 Q1-22 Q2-22 Flat +/- 5% Revenue Gross Margin Total Operating Expenses HY1-22 € 369.3 +15% 60.5% 60% € 68.6 +15% HY1-21 HY1-22* HY1-2
Slide 54: Investment Considerations
Investment Considerations Assembly market Long term secular Disciplined strategic Wafer level assembly ever more critical in trends drive focus has created an new growth semiconductor value advanced packaging industry leader opportunity chain growth Market presence has Tech leadership and Commitment
Slide 55: V. Appendix
V. APPENDIX May 2022 55
Slide 56: IDM/Subcontractor Order Trends
IDM/Subcontractor Order Trends € millions 1,000 939.1 IDMs Subcontractors 900 816.8 800 700 600 483.1 Orders 500 472.1 400 348.7 300 39% 53% 39% 200 100 61% 61% 47% - 2018 2019 2020 2021 LTM* 32% 39% 41% 45% 55% 45% 68% 61% 55% 59% * Last twelve months ended March 31, 2022 May 2022 56
Slide 57: Baseline Operating Expense Trends
Baseline Operating Expense Trends Baseline Opex Other Opex* Baseline Opex % of Revenue 60.0% 39.9 40.0 50.0% 34.9 Operating Expenses (€ millions) 33.6 9.4 40.0% 3.6 30.4 30.3 30.0 28.6 8.9 30.0% 3.6 23.9 23.3 0.8 20.1% 21.3% 21.3% 30.3 18.2% 20.0% 20.0 30.0 30.4 17.6% 30.5 14.6% 15.1% 25.0 26.0 13.3
Slide 58: Net Income Trends
Net Income Trends Quarterly Trends Net Income Net Margin Adj. Net Margin 100 € 93.5 60% € 84.2 Q1-22 vs. Q4-21 80 • € 67.5 million (+€ 0.4 million) € 67.1 € 67.5 • +€ 9.2 million (+13.9%) on adjusted basis* • +17.9% revenue increase 60 • Baseline opex under control € millions 41.3% • Adjusted net ma
Slide 59: Cash Flow Efficiency Trends
Cash Flow Efficiency Trends € millions % of Revenue 350 296.2 300 278 37.4% 37.1% 36.6% 250 35.0% 33.7% 200 28.4% 184.1 168.2 162.0 150 120.1 100 50 0 2017 2018 2019 2020 2021 LTM Total Cash Flow from Operations As % of Revenue May 2022 59
Slide 60: Dividend Trends
Dividend Trends Cumulative dividends of € 969.8 million since 2011, or € 12.78 per share Dividend Dividend (€) Payout Ratio 3.50 100% 3.33 100% 98% 98% 3.00 96% 2.50 2.32 95% 94% 2.00 92% 1.67 1.70 90% 90% 90% 1.50 1.01 88% 1.00 86% 0.50 84% 0.00 82% 2017 2018 2019 2020 2021 Dividend Dividend Payout
Slide 61: Share Repurchase Activity
Share Repurchase Activity Share Repurchases Average Cost per Share 60 90.0 50.1 80.0 50 € 72.82 44.6 € 69.84 70.0 Avg Cost per Share 40 60.0 35.5 50.0 € millions 30 40.0 € 38.05 20 17.8 18.6 30.0 € 24.31 € 21.86 20.0 10 10.0 0 0.0 2018 2019 2020 2021 2022* • Approximately 220,000 treasury shares at
Slide 62: Besi Market Cap & Liquidity Has Expanded
Besi Market Cap & Liquidity Has Expanded Shareholdings Migrated from NL to US/UK over Past 5 Years Symbol/ • BESI Avg. Daily Volume and Liquidity Index • Euronext AEX Avg Vol * Avg Price (€ millions) 1,500 100 Market Volume (thousands) 80 1,000 Market • € 4.8 billion 60 Cap* ($ 5.0 billion) Profile
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