ELMOS Roadshow Presentation Sept 2012

ELMOS Semiconductor AG September 2012

ELMOS at a glanceSeptember 2012 © ELMOS Group 2

Innovative mixed signal IC company  Leading automotive semiconductor company  ASSPs and ASICs with state‐of‐the‐art mixed signal technology roadmap  Growing sales in industrial and consumer goods  Strong competence in pressure sensors (MEMS)  More than 2 billion chips sold  Worldwide presence with German rootsSeptember 2012 © ELMOS Group 3

A Global ELMOS NetworkMajor Locations Sales R&D Production St.Petersburg Detroit Seoul Silicon Valley, Shanghai TokyoMEMS HQ Hong Kong Singapore Berlin Frankfurt Oder Dresden RoW Dortmund, Global HQ Pretoria Bruchsal 18% Munich 68%September 2012 © ELMOS Group 4

ELMOS Supplies To Nearly All Car OEMsSelected ELMOS automotive customers …ELMOS insideSeptember 2012 © ELMOS Group 5

ELMOS Industrial Segment Is GrowingSelected ELMOS industry customersSeptember 2012 © ELMOS Group 6

ProductsSeptember 2012 © ELMOS Group 7

ELMOS Product LinesOverview INTERFACE POWER LIN, FlexRay™, LIN SBC, PSI5, Converter, Controller and Smart Power Industrial BUS Supply, LED‐Driver MOTOR CONTROL SENSOR & SAFETY High Performance DC, Stepper and EC/BLDC Pressure‐, PIR‐, Hall‐, Sun angle‐ and Motor Driver Ultrasonic‐Sensors and Airbag SPECIAL PRODUCTS OPTICAL SENSORS & HALIOS® IGBT Driver, Glow Plug control, Discover HALIOS®: Gesture and Motion I/O devices Detection Long‐term experience paired with open‐mind for innovationsSeptember 2012 © ELMOS Group 8

ELMOS Is Driven By Innovation (1/3) Ultrasonic park assistance ICs AMR sensor ICs Motor Driver IC Advanced HMI ICsSeptember 2012 © ELMOS Group 9

ELMOS Is Driven By Innovation (2/3) PIR sensor ICs Airbag sensor ICs Power supply ICs Tire pressure sensor cellsSeptember 2012 © ELMOS Group 10

ELMOS Is Driven By Innovation (3/3) Networking ICs (Partial CAN) LED driver ICs KNX bus ICs Networking ICs (FlexRay)September 2012 © ELMOS Group 11

Asian Markets & ASSP businessSeptember 2012 © ELMOS Group 12

Asian Markets 2012  New offices and distributors  ELMOS Shanghai & ELMOS Singapur  WT Microelectronics & Technokey  1st Fair of the year: electronica Shanghai (March)  ELMOS builds on a strong know‐how network  On‐the‐spot application support  This leads to new projects  with local automotive and  industrial companiesSeptember 2012 © ELMOS Group 13

ASSP business 2012  ASSP strategy begins to pay off  Number of available ASSPs keeps growing  ASSPs for automotive and industrial as well as consumer goods  ASSP: today 15% of sales Number of ASSPs available from product catalog  New product catalog 81 96 scheduled to be published 53 63 October 2012  new section for industrial products 2009 2010 2011 2012 2013September 2012 © ELMOS Group 14

ProductionSeptember 2012 © ELMOS Group 15

Production 2012  8‐inch conversion in own fab  Planned Milestones achieved  … will be continued  Foundry partner MagnaChip started delivery to ELMOS  ELMOS can offer a risk‐mitigating production footprint: located in Germany, Asia and US  Product designs with next technology generation (0.18µ) startedSeptember 2012 © ELMOS Group 16

FinancialsSeptember 2012 © ELMOS Group 17

Sales & employees200 1.200150 900100 600 50 300 0 0 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012e Employees (as of year‐end) Sales (in million Euro) Sales growth in 2011 despite economic uncertaintySeptember 2012 © ELMOS Group 18

H1 2012: Sales and gross margin ‐5.1% 97.3 92.4 ‐3.0% 46.9 45.5 H1 2011 H1 2012 Q1 2012 Q2 2012Gross result 43.1m Euro 36.3m Euro 18.2m Euro 18.0m EuroGross margin 44.3% 39.2% 38.9% 39.6%  Sales below prior‐year’s level as expected due to weakness of the automotive market, especially of non‐premium carmakers  Cost of sales burdened by higher costs for assembly, 6 to 8 inch transition and higher energy costs  Gross margin impacted by under‐utilization of production capacity  Cost‐cutting measures showing first effects in the second quarter of 2012 September 2012 © ELMOS Group 19

H1 2012: Sales by regions and by segments H1 2011 H1 2012 Other Asia/Pacific 7.3% 6.8% Other EU countries 20.4% 15.2% 7.5% 35.4% 33.9% 8.3% U.S. Asia keeps 35.1% growing 30.1% Germany Micromechanics 10.7% 8.6% MEMS are 91.4% on the right SemiconductorSeptember 2012 track 89.3% 20 © ELMOS Group

H1 2012: EBIT 12.2 ‐64.6% 242.5% 3.3 4.3 1.0 H1 2011 H1 2012 Q1 2012 Q2 2012in % of sales 12.5% 4.7% 2.1% 7.3%  Increase of operating expenses weighs on EBIT  Research and development expenses expanded according to plan  New Asian locations successful  Q2 2012 EBIT supported by income from the revaluation of the former interest in MAZ due to first‐time consolidation effective from the beginning of the second quarter of 2012 (1.8m Euro) September 2012 © ELMOS Group 21

H1 2012: Net income and earnings per share 8.5 ‐58.5% 3.5 368.8% 2.9 0.6 H1 2011 H1 2012 Q1 2012 Q2 2012 % of sales 8.7% 3.8% 1.3% 6.4% Earnings per 0.44 0.18 0.03 0.15 share in Euro (basic) Low tax rate of 10.7% in H1 2012 is amongst others accounted for by the non‐taxable profit from the revaluation of the former interest in MAZ due to first‐time consolidationSeptember 2012 © ELMOS Group 22

OutlookSeptember 2012 © ELMOS Group 23

Economy loses its drive world‐wide (I) September 2012September 2012 © ELMOS Group

Economy loses its drive world‐wide (II)September 2012 © ELMOS Group

Outlook  Indications suggest that the economy will slow down worldwide  The German Association of the Automotive Industry (VDA) expects a “stronger headwind” for the European auto industry  ELMOS …  has been observing a defensive order behavior among our customers as a result of the economic uncertainty  responds quickly and flexibly to any positive or negative changes in the global economy  … and introduced a cost cutting program in April 2012  Reduction of the number of temporary employees  Short‐time working scheme started in May 2012  No negative influence on R&D and sales capabilities September 2012 © ELMOS Group 26

Outlook 2012 Outlook 2012 ⃰ (August 2012) Sales Slightly below 2011 level EBIT margin High single-digit percentage range Capex Less than 15% of sales Free Cash Flow Positive (adjusted) ⃰ based on an exchange rate of 1.35 US‐Dollar ∕ Euro  ELMOS …  has grown into a financially strong company with a broad range of know‐how  will continue to pursue its strategy  has made very good progress at acquiring new projects  will help to raise sales level in the mid‐termSeptember 2012 © ELMOS Group 27

Appendix

Shareholder structureShare capital: 19,571,385 Euro/shares (as of August 31, 2012)September 2012 © ELMOS Group 29

Research coverageClose Brothers Seydler Research Veysel TazeDZ Bank Harald SchnitzerHauck & Aufhäuser Tim WunderlichNatixis Securities Stéphane Houri, Maxime Mallet Mirabaud Securities Susan AnthonyWarburg Research Malte SchaumannWGZ Bank / Independent Research Matthias EngelmayerSeptember 2012 © ELMOS Group 30

Financials / Review 2011New sales record ‐ Quality of earnings improved  Sales increased to 194.3 million Euro  Growth of 8.8%, adjusted by the sale of the packaging business  Progress in Asia is encouraging  Improved profitability  Gross Margin 2011: 46.1% (2010: 45.3%)  EBIT Margin 2011: 13.7% (2010: 12.5%)  Net income 2011: 9.7% (2010: 9.6%)  Sustainable positive Operating & Free Cashflow  Dividend: 0.25 Euro/Share / increase +25%September 2012 © ELMOS Group 31

Key financials – Five‐year overview In million Euro unless otherwise indicated 2007 2008 2009 2010 2011 Sales 176.1 175.1 123.8 184.7 194.3 Gross profit 73.1 75.6 35.9 83.8 89.6 R&D 30.9 31.6 25.3 29.6 32.5 Operating income 14.5 15.4 -14.8 23.8 24.2 EBIT 15.2 16.5 -15.8 23.1 26.6 Net income attributable to owners of the parent 8.8 10.6 -12.2 17.8 18.9 Basic earnings per share (Euro) 0.45 0.55 -0.63 0.92 0.98 Operating cash flow 30.8 22.5 9.4 33.0* 33.2 Capital expenditures 24.5 20.8 7.4 12.4 19.4 for intangible assets and property, plant and equipment Free cash flow** 29.4 10.3 3.9 12.5 4.4 Adjusted free cash flow*** 6.4 1.7 2.1 20.2 10.7 Employees (annual average) 1,177 1,117 1,038 990 988 * Prior‐year figure adjusted due to reclassification of investments in marketable securities from operating cash flow to investing cash flow ** Cash flow from operating activities less cash flow from investing activities *** Cash flow from operating activities, less capital expenditure for intangible assets, less capital expenditure for property, plant and equipment, less payments for investments, plus disposal of investmentsSeptember 2012 © ELMOS Group 32

Regional sales development 194.3 184.7  Sales growth mainly due 23.7 +47% 34.8 to 13.1 14.5  Asian and 70.2 69.0  U.S. markets 63.7 62.9  Asian Markets are demanding at 14.0 13.1 2010 2011  Time‐to‐Market Asia/Pacific Other EU countries  Level of Innovation U.S. Other Germany Asia / Pacific region drives growthSeptember 2012 © ELMOS Group 33

Sales and Gross Margin +5.2% resp. +8.8% 184.7 194.3 6.1 48.1 49.2 48.0 49.0 178.6 2010 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2011Gross Margin 45.3% 46.1% 43.3% 45.3% 48.1% 47.7%  Sales increased by 5.2% in 2011  Adjusted by the special packaging business sold as of Dec 31, 2010, sales in 2011 gained +8.8% over 2010  Sales almost equally spread over the quarters 2011, with a slowdown visible towards the end of the year  Improvement in gross margin due to gains in production efficiency September 2012 © ELMOS Group 34

Research & Development +9.8% 32.5 29.6 8.2 8.4 8.3 7.7 2010 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2011% of sales 16.0% 16.7% 17.0% 17.0% 17.4% 15.6% New R&D resources have been added  Focus on energy efficient products, esp. ASSPs Technology development, also with partners (MagnaChip), is running according to plan Full year research grants materializing in Q4 2011 R&D activities expanded in 2011September 2012 © ELMOS Group 35

Marketing & Sales +28.4% 16.2 12.6 4.9 3.8 4.0 3.5 2010 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2011% of sales 6.8% 8.3% 7.4% 7.6% 8.3% 9.9% Asia growth: new locations in Shanghai and Singapore as well as expansion of South Korean office  Major part of the increase of marketing and selling expenses in Q4 2011 caused by a few one‐offs ELMOS´ growth will increasingly be driven by business in AsiaSeptember 2012 © ELMOS Group 36

Administrative expenses ‐6.0% 17.8 16.7 4.3 4.5 4.1 3.8 2010 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2011% ofSales 9.6% 8.6% 8.5% 8.7% 9.3% 7.8%  Administrative expenses well under control  Drop in Q4 2011 caused to a large extent by one‐offs September 2012 © ELMOS Group 37

EBIT +15.1% 26.6 23.1 7.5 6.9 6.3 5.8 2010 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2011% ofSales 12.5% 13.7% 12.1% 12.9% 14.5% 15.3%  Significant improvement of EBIT margin despite increase in functional costs due to expansion of development and sales, especially in Asia September 2012 © ELMOS Group 38

Net finance expenses and tax expenses Net finance expenses (in million Euro) Tax expenses (in million Euro) 1.4 6.6 0.8 3.9 2010 2011 2010 2011 Tax rate 18.1% 25.6% Significant decline of net finance expenses  Tax rate returning to rather normal level in achieved 2011 September 2012 © ELMOS Group 39

Net result & EPS +6.6% 18.9 17.8 2010 2011 % of Sales 9.6% 9.7% EPS 0.92 0.98 in Euro (basic) ELMOS paid out a dividend of 0.25 Euro per share September 2012 © ELMOS Group 40

Focus on cash flow generation … Operating Cash flow Capital expenditures 33.0* 33.2 30.8 28.5 26.4 24.5 22.5 20.8 19.4 12.4 9.4 7.4 2006 2007 2008 2009 2010 2011 2006 2007 2008 2009 2010 2011 % of 16.4% 13.9% 11.9% 6.0% 6.7% 10.0% Adjusted Free Cash flow** sales 20.2  Continued strong operating cash flow 10.7 6.4  Sustainable free cash flow generation 2.2 1.7 2.1 2006 2007 2008 2009 2010 2011 * Prior‐year figure adjusted due to reclassification of investments in marketable securities from operating cash flow to investing cash flow ** Cash flow from operating activities, less capital expenditure for intangible assets, less capital expenditure for property, plant and equipment, less payments for investments, plus disposal of investmentsSeptember 2012 © ELMOS Group 41

… leads to a comforting and continuously improving net cash position 35.7 26.8 6.0 1.8 -11.1 -48.4 2006 2007 2008 2009 2010 2011 Continuous improvements of cash positionSeptember 2012 © ELMOS Group 42

Net working capital +11.6% 47.3 40.0 42.4 35.8 28.7 25.3 21.3 18.8 2010 2011 2010 2011 Inventories Accounts receivable Accounts payable % of 22.9% 24.4% sales Limited cash drain from working capital needs despite business expansionSeptember 2012 © ELMOS Group 43

Balance sheet In million Euro unless otherwise indicated 2009 2010 2011 Intangible assets 33.7 30.6 29.2 Property, plant and equipment 72.8 69.5 71.8 Other non-current assets 8.3 14.3 17.5 Inventories 31.5 35.8 40.0 Trade receivables 20.0 25.3 28.7 Other current assets 55.4 73.7 82.8 Total assets 221.7 249.2 269.9 Equity 154.4 172.3 187.9 Non-current liabilities 43.0 43.6 36.0 Trade payables 12.9 18.8 21.3 Other current liabilities 11.4 14.5 24.6 Total equity and liabilities 221.7 249.2 269.9September 2012 © ELMOS Group 44

Cash flow data In million Euro unless otherwise indicated 2009 2010 2011 Cash flow from operating activities 9.4 33.0* 33.2 % of sales 7.6% 17.9% 17.1% Capital expenditures -7.4 -12.4 -19.4 for intangible assets and property, plant and equipment % of sales -6.0% -6.7% -10.0% Cash flow from investing activities -5.5 -20.5* -28.7 Free cash flow** 3.9 12.5 4.4 Adjusted Free cash flow*** 2.1 20.2 10.7 * Prior‐year figure adjusted due to reclassification of investments in marketable securities from operating cash flow to investing cash flow ** Cash flow from operating activities less cash flow from investing activities *** Cash flow from operating activities, less capital expenditure for intangible assets, less capital expenditure for property, plant and equipment, less payments for investments, plus disposal of investmentsSeptember 2012 © ELMOS Group 45

ELMOS Semiconductor AG Heinrich‐Hertz‐Str. 1 | 44227 Dortmund | Germany Telephone: + 49 231 75 49 0 | Telefax: + 49 231 75 49 0 info@elmos.com | www.elmos.com DISCLAIMER This presentation contains forward‐looking statements based on beliefs of ELMOS‘ management. Such statements reflect the company‘s current views with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results to be materially different, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products, lack of acceptance of new products or services and changes in business strategy. Actual results may vary materially from those projected here. ELMOS does not intend or assume any obligation to update these forward‐looking statements.September 2012 © ELMOS Group 46

ELMOS Roadshow Presentation Sept 2012

by Elmos Semiconductor AG on Sep 10, 2012

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ELMOS Roadshow Presentation Sept 2012 Presentation Transcript