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AT&S Company Presentation January 2015
AT&S is a leading high-tech printed circuit board company with a global footprint. It has production facilities in Europe and Asia focused on high mix/low volume and high volume/low mix respectively. In the first half of 2014/15, AT&S continued its sound top-line growth and above industry margins. It is entering a new high-end business segment of IC substrates with a new plant in Chongqing, China starting production in 2016. AT&S aims to leverage its technological leadership to capitalize on growing trends in areas like the Internet of Things.
AT&S Company Presentation January 2015
- 1. AT & SAustria Technologie & Systemtechnik Aktiengesellschaft | Fabriksgasse13 | A-8700 Leoben Tel +43 (0) 3842 200-0 | E-Mail info@ats.net www.ats.net AT&S first choice for advanced applications Company Presentation January 2015
- 2. 1 Company Overview Strategy &Market Annex Financials Table of Contents
- 3. 2 AT&S – aworld leading high-tech PCB company Megatrend-driven markets with attractive growth potential Entering a new high-end business segment by 2016 Pure high-end segment play Technology & quality leader Largest European PCB producer Partner of choice for blue chip customer base Balanced industry portfolio Strong Asian production footprint with focus on high volume/low mix European footprint: high mix/low volume Operational excellence: Outstanding process know-how, productivity and efficiency One of the most profitable players in the industry: above industry EBITDA margins Strong cash flow generation Proven long term successful financial track record
- 4. 3 AT&S – KeyFacts Strong track record1 Balanced portfolio/Global customer base2 Distribution Revenue: Business Unit Distribution Revenue: Customer Region 488 514 542 590 96 103 102 127 47 42 31 54 2010/11 2011/12 2012/13 2013/14 Revenue EBITDA EBIT +5% +5% +9% Revenue growth 7% InEURm 27% 7% 19% 47% Germany/Austria Other European countries Asia Americas 52%48% Mobile Devices & Substrates Industrial & Automotive (inkl. Medical) 3
- 5. 4 Global footprint ensurescost efficiency European production facilities: high mix/low volume Asian production facilities: high volume/low mix Sales network spanning three continents About ~7,400 employees Plant Shanghai, China Staff: ~4.250 Plant Ansan, Korea Staff: ~250 Plant Nanjangud, India Staff: ~1.100 Plant Chongqing, China under construction Staff: ~400 AT&S Sales OfficesAT&S Plants Plant Leoben, Austria Headquarters Staff: ~ 800 Plant Fehring, Austria Staff: ~350
- 6. ►► volatility dueto seasonal effects 5 Balanced high-end product portfolio to level seasonality CharacteristicCharacteristic Selected ApplicationsSelected ApplicationsSegmentSegment 1) Based on external revenue EUR m in H1 2014/15 Mobile Devices & Substrates Advanced Packaging Selected Market Leaders Selected Market Leaders GoPro Sony LG Canon Qualcomm Blackberry Lenovo Huawei Samsung Xiaumi ZTE Intel Apple ►► stable business due to longer product life time Includes the segment Advanced Packaging (still in the process of being established) as well as group management and financial activities Others (Revenue in EUR m) (Revenue in EUR m) 52% 48% 74.5 90.1 87.7 69.0 68.0 88.7 Q1 13/14 Q2 13/14 Q3 13/14 Q4 13/14 Q1 14/15 Q2 14/15 66.4 66.3 62.9 69.7 72.6 71.7 Q1 13/14 Q2 13/14 Q3 13/14 Q4 13/14 Q1 14/15 Q2 14/15 Industrial & Auto- motive & Medical Revenue Share1) Revenue Share1) Communication Computing Automotive: Lighting, thermal, sensors, safety, infotainment, powertrain Medical: Patient monitoring, Therapy, diagnostic Industrial: Instrumentation & Control, power solutions, lighting Consumer Electronics Osram Hella Siemens General Electric Continental Harmann EADS Texas Instruments ST Microelectronics Freescale Semiconductor RFMD TDK-Epcos Qualcomm
- 7. 6 Company Overview Strategy &Market Annex Financials Table of Contents
- 8. 7 Convincing Business Model Levelof complexity Strategic focus on high-end segments „Market intelligence“ – anticipate and industrialise future leading-edge trends and technologies by defining high-end applications and technology niches Focus on profitable segments with sustainable growth perspectives Continuous technological process development Successfully leveraging technology between business segments Sustainable profitability with strong cash flow out of core business Continously improve product mix and capacity utilisation for on-going above industry margins Strict working capital management / Operational Cash Flow driven decision making EBITDA margin target corridor of 18-20% Accelerate growth by entering a new high-end business segment IC-substrates with start of production in 2016 Joint-development with leading semiconductor company Cost advantage: one of the first companies operating a high-end IC Substrate manufacturing facility in China 1 2 3
- 9. 8 PCB Market Growthoutperforms E-Systems Market 1) Market Size 2013 , in USD bn / Source: Prismark, April 2014 2) AT&S addressable Market Size 2013, in USD bn / Source: BPA, Prismark, AT&S, 2013-2014 3)excl. IC Substrates Business Unit Industry/E-Systems Market Selected Applications E-Systems Market 1) CAGR 2013-2018 PCB Market Size 2) CAGR 2013-2018 Mobile Devices & Substrates Computing Notebooks, PCs, Server 490 bn 2.7% 17.0 bn 3.1% Communications Smartphones, Tablets 482 bn 3.1% 15.3 bn 3.7% Consumer Electronics Cameras 147 bn 3.5% 6.4bn 3% Substrates Microprocessors, Graphic Processors 7.6 bn 4.9% Industrial & Automotive & Medical Industrial & Medical Instrumentation & Control, Therapy, Diagnostic 253 bn 5.8% 3.2 bn 12.9% Medical 1.3 bn 6.8% Automotive Lighting, sensors, safety, infotainment, powertrain 178 bn 6.5% 4.3 bn 7.1% Total Market Size3) CAGR 2013-2018 1,678 bn 3.8% 47.5 bn 4.4%
- 10. 9 Market Player/Position HDITechnology Source: Prismark, August 2014; NTI CY2013; AT&S Strategy Market position HDI Technology Revenue (in USD m) Rank Supplier HDI Non HDI PCB´s IC-Substrates Total revenue 1 Unimicron 682 671 795 2.148 2 Compeq 538 509 - 1.047 3 AT&S 530 248 - 778 4 SEMCO 480 173 1.212 1.865 5 Ibiden 426 - 1.080 1.506 6 TTM 406 962 - 1.368 7 Zhen Ding 343 1.774 - 2.117 8 Tripold 305 1.077 - 1.382 9 DAP 279 21 - 300 10 Unitech 236 304 - 540
- 11. (as of 30/09/2014) Completionof Infrastructure Start Equipment Characterisation Certification Start Training Start Equipment Ordering Plant Lay-out Product- Specification Start of Production 10 Q4 Q1 Q2 Q3 FY 2013/14 Q4 Q1 Q2 Q3 FY 2014/15 Q3 FY 2012/13 Q4 Q1 Q2 Q3 FY 2015/16 Q4 Q1 Q2 Q3 FY 2016/17 Q4 Focus on high-end segment of IC Substrates Development in close cooperation with a world leading semiconductor company Investment as at 30/09/2014: EUR 163.1 m1) Equipment for first line installed and internal qualification process finished Characterisations and certification has started, production of samples started Start of production is scheduled for 2016 Project Status IC Substrate plant Chongqing 1)Additions to tangible fixed assets as of 30/09/2014 Start Equipment Installation
- 12. 11 Driving Future Trends:Internet of Things (IoT) and Application Structures Healthcare Glasses Wearable ElectronicsWearable Electronics Smart MobilitySmart Mobility Autonomous Driving Car2Car Communication Smart CitySmart City Smart Lighting Smart BuildingsSmart Buildings Home/Building Automatisation Energy Management Smart Production/Industry 4.0Smart Production/Industry 4.0 Automatisation/Robotics Production Control Systems Smart HealthcareSmart Healthcare Connectivity (e.g. online patient monitoring) Smart EnergySmart Energy Smart Metering 30-50 Billion of „Things“ will be connected in 2020 Wearables market forecast: USD 10 – 60 bn by 2018 Source: IHS, 2013
- 13. 12 Company Overview Strategy &Market Annex Financials Table of Contents
- 14. 13 Sound top-line growth,above industry margins and increasing cash conversion 2010/11 2011/12 2012/13 2013/14 Continuous growth path up to full capacity utilisation Revenue with products out of Asian production increased from 69% in 2010/11 to 76% in 2013/14 Next significant step-up in growth: start of production of IC-substrate in Chongqing in 2016 EBITDA AND EBITDA-MARGIN OPERATING CASH FLOW / Y-O-Y DEVELOPMENT EBITDA increase due to high capacity utilisation Continuous conversion to more high-end product mix EBITDA margin guidance: 18-20% Operating cash flow generation driven by strong EBITDA performance 488 514 542 590 71 87 72 105 Selected Key Financials (EUR m)Selected Key Financials (EUR m) REVENUE / Y-O-Y GROWTH 96 103 102 127 19,7% 20,0% 18,8% 21,5%
- 15. 14 Efficient operational costbase 106 75 82 96 106 114 23,6% 20,1% 16,8% 18,6% 19,5% 19,3% Working Capital Working Capital % of Sales Working Capital Development in EUR m 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
- 16. 15 Staff and Capex STAFF1) Decreasednumber of staff in core business reflects improved productivity. CAPEX (in EUR m) CAPEX increase includes technology process developments in existing locations and investments in Chongqing project. Regular Business Employees Project Chongqing 1) incl. leased personel, average for the period 6,987 7,417 7,321 7,027 2010/11 2011/12 2012/13 2013/14 54 123 115 113 40 90 2010/11 2011/12 2012/13 2013/14
- 17. Financials H1 2014/15 16 EURthousands (unless otherwise indicated) 01.04.2014- 30.09.2014 01.04.2013 – 30.09.2013 STATEMENT OF PROFIT OR LOSS Revenue 302,077 299,933 produced in Asia 76% 75% produced in Europe 24% 25% EBITDA 72,297 65,412 EBITDA margin 23.9% 21.8% EBIT 39,928 30,567 EBIT margin 13.2% 10.2% Profit for the period 28,445 21,957 Cash Earnings 60,785 56,785 EPS (average number of shares outstanding)1) 0.73 0.94 1) 2014/15: Lower result substantially due to issue of new shares and sale of own shares in Sept. and Oct. 2013 Same basis of number of shares than in comparison period would reflect EPS of EUR 1.21
- 18. Financials H1 2014/15 17 EURthousands (unless otherwise indicated) 30.09.2014 31.03.2014 STATEMENT OF FINANCIAL POSITION Non-current assets 603,549 483,858 Currents assets 453,641 432,201 Equity 465,141 390,680 Non-current liabilities 398,701 370,336 Current liabilites 193,348 155,043 Total assets 1,057,190 916,059 Net debt 179,989 110,874 Net gearing 38.7% 28.4% Net working capital 126,226 91,722 Net working capital per revenues 20.9% 15.6% Equity ratio 44.0% 42.7%
- 19. Financials H1 2014/15 18 EURthousands 01.04.2014 – 30.09.2014 01.04.2013 – 30.09.20131) STATEMENT OF CASH FLOWS Profit for the period 28,445 21,957 Non cash bearing of profit or loss 40,312 34,337 Changes in Working Capital (35,107) (15,967) Net cash generated from operating activities 33,650 40,327 Net cash used in investing activities (88,699) (40,079) Net cash generated from financing activities 12,618 24,246 Net increase/decrease in cash and cash equivalents (42,431) 24,494
- 20. 19 Overview Debt PortfolioDuration Maturity EUR m < 1 Year 1-5 Years > 5 Years Total Corporate Bond 4.3 99.6 - 103.9 Export Loans 32.0 - - 32.0 Public funds and other - 2.4 1.1 3.5 Bank Borrowings 13.2 200.4 49.1 262.7 Total 30/09/2014 49.5 302.4 50.2 402.1 Total 31/03/2014 46.0 282.9 43.0 371.9
- 21. AT&S - StockProfile Listing Vienna Stock Exchange, Prime Standard Indices ATX Prime, WBI ThomsonReuters (A) ATSV.VI Bloomberg (A) ATS AV # of shares outstanding 38.85m Avg. daily volume 65,000 1 year abs performance 24.51% Dividend 2013/14: EUR 0.20 Dividend yield: 2.3% Calendar 3rd Quarter Results 2014/15 27 January 2015 Annual Results 2014/15 7 May 2015 21st Annual General Meeting 9 July 2015 20 YTD price development/liquidity & Shareholder structure *including direct and indirect holdings * * ATX Prime AT&S
- 22. 21 Outlook FY 2014/15 Basedon the strong demand in the industry in the second half of the calendar year 2014 – particularly in the mobile devices segment – and the low visibility in respect to the first quarter of the calendar year 2015 we are assuming that, provided the macro-economic environment remains stable and considering todays foreign exchange rates, business development will continue to be on a satisfactory level. For the full year 2014/15 we expect revenues in line with prior year and an EBITDA margin on the upper level of our target corridor of 18-20%.
- 23. 22 Company Overview Strategy &Market Annex Financials Table of Contents
- 24. 23 HDI microvia printed circuitboards HDI any-layer printed circuit boards IMS printed circuit boards Multilayer printed circuit boards AT&S Product Portfolio Double-sided printed circuit boards Flexible printed circuit boards Semiflexible printed circuit boards Rigid-flexible printed circuit boards Flexible printed circuit boards on aluminium HDI rigid-flex printed circuit boards
- 25. Management 24 Andreas Gerstenmayer, CEO JoinedAT&S as CEO in 2010 Previous positions include: − 18 years of work experience at Siemens, including Managing Director with Siemens Transportation Systems GmbH Austria and CEO of the Drive Technology business unit in Graz from 2003 to 2008 − Partner at FOCUSON Business Consulting GmbH after leaving Siemens Education and other positions: − Member of the Research Council of Styria − Degree in Production Engineering from Rosenheim University of Applied Sciences Heinz Moitzi, COO COO since 2005; with AT&S since 19811) Previous positions include: − Various management positions within AT&S − Measurement engineer with Leoben University of Mining and Metallurgy Education: − Degree from Higher Technical College of Electrical Engineering − Studied electrical installation with Stadtwerke Judenburg (Judenburg municipal utility company) Karl M. Asamer, CFO Joined AT&S as CFO in 2014 Previous positions include: − Managing Director of GEKA Group in Germany − Managing Director of Sell GmbH in Germany Education: − Degree: doctorate in business administration in Linz, Austria 1)He was already with the founding company of AT&S
- 26. 1) High DensityInterconnect (laser-drilled printed circuit boards) 25 History 2013 Collaboration agreement with leading semiconductor manufacturer to enter IC substrate market 2011 Acquisition of land and start of construction of a high-end plant in Chongqing, China 2010 Relocation of Group Headquarters from Vienna to Leoben Ramp-Up plant II in Nanjangud 2009 Restructuring and reorientation of Leoben plant towards high- value industrial business Focusing Shanghai on high-end mobile devices segment 2008 Relisting on the Vienna Stock Exchange (Prime Market) 2006 AT&S buys flexible plant in Korea 2002 Start of production in new AT&S plant in Shanghai – one of the world’s leading HDI1) facilities 1999 AT&S listed on the Neuer Markt at the Frankfurt Stock Exchange AT&S buys PCB plant in India 1994 Privatisation and acquisition by Hannes Androsch, Willibald Dörflinger and Helmut Zoidl 1987 Foundation of AT&S
- 27. Five core dimensionsof sustainability within AT&S Energy and carbon footprint Water AT&S – a learning organisationResources Thinking ahead – shaping the future CSR gains importance in long term success Improving efficiency Motivated and qualified staff CSR as a key to sustainable business success 26 The importance of sustainability is rising within: Authorities (basis for securing operation licences) Customers (relevant for placing orders)
- 28. AT&S saves CO2and Water… 27 Sustainability – Figures and Fields of Action AT&S aims to minimise its environmental footprint by reducing the CO2 emissions per m2 PCB attributable to production processes by 5% a year. AT&S aims to reduce the Group‘s annual fresh water consumption per m2 PCB by 3%.
- 29. Visit: www.ats.net; Twitter@AT&S IR_PR; YouTube AtundS 28 AT&S – first choice for advanced applications IR Contact: Elke Koch Fabriksgasse 13, 8700 Leoben/Austria Tel: +43 3842 200 5925 Mobile: +43 676 8955 5925 Fax: +43 3842 200 15909 e.koch@ats.net www.ats.net
- 30. Disclaimer 29 This presentation isprovided by AT & S Austria Technologie & Systemtechnik Aktiengesellschaft, having its headquarter at Fabriksgasse 13, 8700 Leoben, Austria (“AT&S”), and the contents are proprietary to AT&S and for information only. AT&S does not provide any representations or warranties with regard to this presentation or for the correctness and completeness of the statements contained therein, and no reliance may be placed for any purpose whatsoever on the information contained in this presentation, which has not been independently verified. You are expressly cautioned not to place undue reliance on this information. This presentation may contain forward-looking statements which were made on the basis of the information available at the time of preparation and on management‘s expectations and assumptions. However, such statements are by their very nature subject to known and unknown risks and uncertainties. As a result, actual developments, results, performance or events may vary significantly from the statements contained explicitly or implicitly herein. Neither AT&S, nor any affiliated company, or any of their directors, officers, employees, advisors or agents accept any responsibility or liability (for negligence or otherwise) for any loss whatsoever out of the use of or otherwise in connection with this presentation. AT&S undertakes no obligation to update or revise any forward- looking statements, whether as a result of changed assumptions or expectations, new information or future events. This presentation does not constitute a recommendation, an offer or invitation, or solicitation of an offer, to subscribe for or purchase any securities, and neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever. This presentation does not constitute any financial analysis or financial research and may not be construed to be or form part of a prospectus. This presentation is not directed at, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.