SNS SECURITIES SMALL & MIDCAP SEMINAR,21 JUNE 201221 June 2012                             1
SAFE HARBOR STATEMENTThis presentation contains statements about managements future expectations, plans and prospects of o...
AGENDA I.       Company Overview II.      Market III.     Strategy IV.      Financial Review V.       Summary21 June 2012 ...
I. COMPANY OVERVIEW21 June 2012            4
I. COMPANY OVERVIEW                                • Leading assembly equipment supplier with #1 and #2                   ...
I. BESI PRODUCT POSITIONING                          Back-end Semiconductor Assembly Process   Dicing            Die Attac...
I. BESI EQUIPMENT PORTFOLIODie Attach                                Packaging & Plating                    Wire Bonding  ...
I. CORPORATE TRANSFORMATION                                                                                               ...
I. CUSTOMER ECOSYSTEM Customers                       End Products                    End Use  • Blue chip customer base, ...
I. PRODUCT SHIFT TO ADVANCED PACKAGING   END USER APPLICATIONS                                                            ...
II. MARKET21 June 2012   11
II. ASSEMBLY EQUIPMENT MARKET FORECAST                            Assembly Equipment Market Size (Apr 2012 VLSI)          ...
II. BESI COMPETITIVE POSITION                                          2011     2010     2009     2008Source: VLSI January...
II. ADVANCED PACKAGING IS THE FUTURE                                                                        Greater       ...
II. SMART PHONE / TABLET MARKET TRENDS                                              Smart Phones 2011-2016                ...
II. SMART PHONE ILLUSTRATIONMain Components                                             Manufacturer   Country        Besi...
III. STRATEGY21 June 2012      17
III. BUSINESS STRATEGYVision         World class assembly               equipment manufacturerMarketpositioning    Fast gr...
III. STRUCTURAL TRANSFORMATION CONTINUES                                                2011            2012              ...
III. AQUISITION STRATEGY    Packaging & Plating                  Die AttachPackaging        Plating   Leadframes   Flip Ch...
IV. FINANCIAL REVIEW21 June 2012             21
IV. SUMMARY FINANCIAL HIGHLIGHTSYear Ended December 31,                                                           • Financ...
IV. LIQUIDITY TRENDS                                                                                              Cash    ...
V. SUMMARY21 June 2012   24
V. SUMMARY• Leading semi assembly equipment supplier with #1 or #2 positions in fastest  growing segments (smart phones/ta...
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Presentation SNS Seminar, 21 June 2012

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Presentation SNS Seminar, 21 June 2012

  1. 1. SNS SECURITIES SMALL & MIDCAP SEMINAR,21 JUNE 201221 June 2012 1
  2. 2. SAFE HARBOR STATEMENTThis presentation contains statements about managements future expectations, plans and prospects of our business thatconstitute forward-looking statements, which are found in various places throughout the press release, including, but notlimited to, statements relating to expectations of orders, net sales, product shipments, backlog, expenses, timing ofpurchases of assembly equipment by customers, gross margins, operating results and capital expenditures. The useof words such as “anticipate”, “estimate”, “expect”, “can”, “intend”, “believes”, “may”, “plan”, “predict”, “project”, “forecast”,“will”, “would”, and similar expressions are intended to identify forward looking statements, although not all forward lookingstatements contain these identifying words. The financial guidance set forth under the heading “Outlook” constitute forwardlooking statements. While these forward looking statements represent our judgments and expectations concerning thedevelopment of our business, a number of risks, uncertainties and other important factors could cause actual developmentsand results to differ materially from those contained in forward looking statements, including our inability to maintaincontinued demand for our products; the impact on our business of potential disruptions to European economies from Eurozone sovereign credit issues; failure of anticipated orders to materialize or postponement or cancellation of orders,generally without charges; the volatility in the demand for semiconductors and our products and services; failure toadequately decrease costs and expenses as revenues decline, loss of significant customers, lengthening of the sales cycle,incurring additional restructuring charges in the future, acts of terrorism and violence; risks, such as changes in traderegulations, currency fluctuations, political instability and war, associated with substantial foreign customers, suppliers andforeign manufacturing operations; potential instability in foreign capital markets; the risk of failure to successfully manageour diverse operations; those additional risk factors set forth in Besis annual report for the year ended December 31,2011 and other key factors that could adversely affect our businesses and financial performance contained in our filings andreports, including our statutory consolidated statements. We are under no obligation to (and expressly disclaim any suchobligation to) update or alter our forward-looking statements whether as a result of new information, future events orotherwise.21 June 2012 2
  3. 3. AGENDA I. Company Overview II. Market III. Strategy IV. Financial Review V. Summary21 June 2012 3
  4. 4. I. COMPANY OVERVIEW21 June 2012 4
  5. 5. I. COMPANY OVERVIEW • Leading assembly equipment supplier with #1 and #2 positions in key products. 27% addressable market share • Broad portfolio: die attach, packaging, plating, wire bond Corporate Profile • Strategic positioning in wafer level and substrate packaging • Global manufacturing operations in 7 countries; 1,618 employees worldwide. HQ in Duiven, the Netherlands • 2011 revenue and net income of € 326.9 and € 26.7 million Financial Highlights • Cash at 3/31/12: € 93.5 million • Total debt at 3/31/12: € 23.1 million • 2009 acquisition, restructuring and Asian production transfer Investment have transformed company and earnings potential • Advanced packaging, smart phone/tablet growth and Asian Considerations production transfer offer significant upside potential • Stock market valuation at significant discount to peers21 June 2012 5
  6. 6. I. BESI PRODUCT POSITIONING Back-end Semiconductor Assembly Process Dicing Die Attach Wire Bond Packaging Plating Die Sort Die Bond Wire Bond Molding Trim & Form Plating Leadframe Assembly Singulation Substrate Ball Grid Array Wire Bond Assembly Die Sort FC Die Bond Molding Singulation Ball Grid Array Substrate Flip Chip Assembly Die Sort FC Die Bond Molding Singulation Wafer Level Packaging Flip Chip Assembly Die Attach Packaging Ball Attach21 June 2012 6
  7. 7. I. BESI EQUIPMENT PORTFOLIODie Attach Packaging & Plating Wire Bonding • Die Sorting • Molding • 3100 - DS 9000E New - AMS series • 3100 - CS 1250 - AMS Foil Smart Card - DS 11000 - AMS WLM New • 3200 Smart Card • Die Bonding • Trim & Form - 2100 xP - Compact series - 2009 series - Power series - 2100 hS New - Compact Line - 2100 sD New New XHD • Component • Singulation In Development Packaging - FSL New - 2200 evo • Common die attach platform • Common packaging platform • Flip Chip • Plating - 8800 Quantum - Leadframe - 8800 Chameo - Solar - "Smart Line" - Film & foil - 2100FC21 June 2012 7
  8. 8. I. CORPORATE TRANSFORMATION Record Revenue: 400 € 351 million Record Profit: € 47 million Die Attach Acquisitions 350 300 Restructuring Dragon I Dragon II € 8.5 million complete: complete: cost savingsRevenue (€ million) 250 € 6 million € 15 million plan cost savings cost savings initiated Asian Production Transfer 200 Esec 2100 transfer completed Initial 150 shipments Dutch tooling & Hungarian of Esec die bonding transferred 2100 from Malaysia 100 Standard packaging and DC die bonding systems transferred to Malaysia Expanding Asian 50 € 14 million spent to build, expand and equip Malaysian system and Chinese capacity in tooling operations ‘12/’13 Asian headcount increased from 34% in ‘06 to 51% in ‘11 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 21 June 2012 8
  9. 9. I. CUSTOMER ECOSYSTEM Customers End Products End Use • Blue chip customer base, top 10 customers represent 44.7% of 2011 revenue • Leading IDMs and Asian Subcontractors. 41%/59% split in 2011 • Long term relationships, some exceeding 45 years21 June 2012 9
  10. 10. I. PRODUCT SHIFT TO ADVANCED PACKAGING END USER APPLICATIONS 2011 Service • Tablets and 12% Computer, LED wireless devices PCs 2008 5% 21% now represent Service 35% of estimated Industrial 2% 10% end user revenue LED Industrial 3% 10% • Automotive has Tablets & Wireless also grown AutoAuto 17% Devices significantly in13% Computer, 35% recent years PCs 50% • Service/spare Tablets & parts has grown Wireless Devices to 12%. Less 22% cyclical revenue streamSource: 2011 Company Estimates21 June 2012 10
  11. 11. II. MARKET21 June 2012 11
  12. 12. II. ASSEMBLY EQUIPMENT MARKET FORECAST Assembly Equipment Market Size (Apr 2012 VLSI) YoY Growth Rate (Apr 2012 VLSI) 6 160% CAGR ‘11-’16: 3.6% 140% 120,5% 5,0 5 4,8 4,5 4,4 120% 4,3 4,2 4,0 100% 4 80% 3 2,9 60% 2,1 40% 2 11,7% 15,6% 7,4% 20% -7,8% -5,3% -9,2% 0% 1 -26,2% -28,2% -20% 0 -40% 2008 2009 2010 2011 2012E 2013E 2014E 2015E 2016E Source: VLSI April 2012 • 2011 assembly market revised growth revised downwards by VLSI to -7.8% • 2012 looks much better than initial forecasts. -5% vs. initial forecast of -21%21 June 2012 12
  13. 13. II. BESI COMPETITIVE POSITION 2011 2010 2009 2008Source: VLSI January 2012 2011 Market Market Market Market Company (In US$ millions) Market Size Share Share Share Share Competition Position Die Attach 1,015.2 32% 29% 29% 27% Die Bonding 749.7 33% 28% 27% N/A ASM-PT, Shinkawa, #1 Panasonic, Renesas, K/S Multi Module N/A N/A N/A N/A N/A Panasonic #1 Flip Chip 207.7 29% 33% 32% N/A Panasonic, ASM-PT #1 Die Sorting 57.8 30% 26% 11% N/A Muhlbauer, ASM-PT #2 Packaging 668.0 12% 10% 13% 12% Molding 407.2 15% 9% 13% 13% Towa, ASM-PT, Yamada, Dai #2 Ichi Seiko T&F 113.9 11% 19% 17% 12% ASM-PT, Gallant #2 Saw/Laser Singulation 138.2 4% 4% 8% 13% Hanmi, Rocco #3 Plating 25.9 92% 90% 98% 38% AGM, Technic #1 Total Addressable Mkt 1,700 27% 24% 27% 21% ASM-PT, Panasonic #1 Total Assembly Mkt 4,192 14% 14% 11% 12% ASM-PT, K/S #3• Gained market share in 2011 particularly in molding, die sorting and die bonding products• 27% addressable market share. Well positioned in highest growth areas• Accuracy, precision and speed distinguishes Besi vs. competition, particularly for mainstream market21 June 2012 13
  14. 14. II. ADVANCED PACKAGING IS THE FUTURE Greater Miniaturization Greater High Growth End Higher Accuracy Complexity User Areas: Die Attach • Die Sorting: DS 9000 • Die Bonding: ES 2009, 2100 Media Tablets, • Flip Chip: DC 8800 FC • Multi Module: DC EVO 2200 Smart phones, Digital set top Lower Power Increased boxes, Autos, Mems Consumption Packaging Density • Molding: AMS-W • Singulation: FCL Higher Performance• High growth applications require ever smaller, denser and more complex chips with increased performance, all at lower energy usage.• <40 nanometer geometry will be the standard chip design over the next 3-5 years• System on Chip or System in Package via substrate and wafer level packaging process is the only answer• Besi has full range of AP systems. 2011E revenue: 70% substrate/wafer level vs. 30% leadframe21 June 2012 14
  15. 15. II. SMART PHONE / TABLET MARKET TRENDS Smart Phones 2011-2016 2,500 76.4% 2,000 30.8% 62.5%million phones 1,500 • Rapid unit growth in smart 850 1,500 phones and tablets forecast 400 650 1,000 over next 5 years 500 1,050 900 850 • Estimated unit growth rates: 600 0 2011 2012 2013 2014 2015 2016 • Smart phones: Basic Phones Smart Phones • 2012: 62.5% • 2016: 3.5x Tablets 2011 - 2014 • Tablets: • 2012: 120% • 2014: 4x • Significant potential revenue growth driver Source: Prismark 21 June 2012 15
  16. 16. II. SMART PHONE ILLUSTRATIONMain Components Manufacturer Country Besi Systems Utilized Processor Samsung South Korea 8800FCQ, AMS-W, Singulation DRAM Memory Samsung South Korea 2100sD, AMS-W, Singulation Flash Memory Chip Samsung South Korea 2100sD, AMS-W, Singulation Battery Samsung South Korea N/A Power Management Dialog Germany 2100sD, 2009 Compass AKM Japan N/A Accelerator/Gyroscope ST Micro Italy/France 2100sDCommunications Radio Frequency Memory Intel USA 8800FCQ, Singulation Wi-Fi/Bluetooth/GPS Broadcom USA 2200 evo, AMS-W, Singulation Receiver/Transceiver Infineon Germany 8800FCQ, AMS-I, Singulation Skyworks, 2200 evo, AMS-W, Singulation, 8800 PA Module Triquint USA ChameoVideo/Audio Touch Screen Control TI USA 2100sD, AMS-W, Singulation Audio Codec Cirrus Logic USA 2100sD, AMS-W, Singulation LCD Display LG South Korea N/A Touch Screen Wintek USA N/A LG, Foxconn, South Korea, Camera – 5/8 megapixel/VGA CoWell China 2200 evoBesi systems are capable of assembling components representing up to 50% of smart phone content 21 June 2012 16
  17. 17. III. STRATEGY21 June 2012 17
  18. 18. III. BUSINESS STRATEGYVision World class assembly equipment manufacturerMarketpositioning Fast growing, leading edge market segmentsHow to win Technology-led, mainstream supplier of substrate and wafer level packaging solutions Enter selected Maximize product Exit when markets with value with transfer technology becomes leading technology into mainstream “commoditized”Actions (I) (II) (III) (IV) (V) Maintain Accelerate Reduce Transfer Acquire leading edge revenue structural costs production to complementary technology growth Asia companies Leverage "One Besi" Strategy21 June 2012 18
  19. 19. III. STRUCTURAL TRANSFORMATION CONTINUES 2011 2012 2013Key Operational Objectives ES 2100 production transfer to Malaysia ES 2009 production transfer to Malaysia 50% MY/100% China capacity expansion 12% HC reduction plan• Keys: transfer of production and personnel to Asia. Increased efficiency of euro operations• Asian production transfer on schedule • 32% YOY increase in Malaysian shipments in 2011. 2x increase in direct shipments • Transfer of ES 2100 production from Switzerland to Malaysia completed in 2011• 12% headcount reduction plan initiated October 2011: € 8.5 million savings targeted. On hold given Q1 order ramp• € 60 million quarterly break even revenue target bettered in Q1-1221 June 2012 19
  20. 20. III. AQUISITION STRATEGY Packaging & Plating Die AttachPackaging Plating Leadframes Flip Chip Chip Sorting Flip Chip/ Single Chip Multi Chip 1993 1995 1997 2000 2002 2005 2010• € 50 million packaging company has become € 327 million assembly equipment supplier• Acquisitions since 2000 totaling € 80 million, net have created Die Attach leader• Seeking technology led companies which increase advanced packaging presence and can be incorporated into One Besi platform21 June 2012 20
  21. 21. IV. FINANCIAL REVIEW21 June 2012 21
  22. 22. IV. SUMMARY FINANCIAL HIGHLIGHTSYear Ended December 31, • Financial transformation since 2008(€ millions, except share data) 2009 2010 2011 • Scale and market presence have changed due to Esec acquisition:Revenue 147.9 351.1 326.9 • Expanded mainstream presenceOrders 162.5 376.5 301.1 • Leveraged revenue potentialGross margin 28% 39% 40% • Strategic positioning in advanced packaging has yielded benefits:EBITDA 17.9 60.5 45.8 • Enhanced top line growthPretax income 4.9 47.4 34.6 • Increased gross marginsNet income 5.4 47.3 26.7EPS (diluted) 0.16 1.25 0.73 • Solid gross margins and profits in 2011 despite downturn due to:Net margin 4% 13% 8% • Advanced packaging presence • Ongoing Asian production transferAdj. net income (loss) (28.0) 41.6 27.4 • 2010 product line restructuringsAdj. EPS (diluted) (0.85) 1.11 0.75 • Solid liquidity base. Expanding net cashNet Cash 19.6 22.9 62.7 • Dividend initiated in 2010Dividend per share - 0.20 0.22 21 June 2012 22
  23. 23. IV. LIQUIDITY TRENDS Cash Debt 100 93.5 • Net cash position has grown to 90 87.5 € 70.4 million from € 19.6 million at year end 2009 • Significant increase in 80 76.6 profitability 69.3 • Redemption and share 70 65.5 conversion of 5.5% convertible 61.8 notes in Q2 2011 60 • Improved inventory (euro in millions) 55.0 49.4 47.7 49.9 management 50 48.1 46.8 46.4 45.9 • Includes € 20.2 million for share repurchases and cash 40 dividends in 2011 • € 1.92 per share relative to 30 27.0 24.8 share price of € 5.70 at end of 23.1 Q1-12 20 16.1 10 • Strong balance sheet supports future organic growth and 0 acquisition strategy Q1-10 Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12Net Cash 0.9 (1.3) 5.1 22.9 19.6 45.7 49.6 62.7 70.4 21 June 2012 23
  24. 24. V. SUMMARY21 June 2012 24
  25. 25. V. SUMMARY• Leading semi assembly equipment supplier with #1 or #2 positions in fastest growing segments (smart phones/tablets). Gaining share• Structural transformation continues. Scalability of business model seen in recent industry cycle• Solid profit in 2011 in challenging environment. Shareholder value enhanced through € 20.2 million share repurchases and dividends• Strong liquidity. € 70.4 million net cash at 3/31/12 (€ 1.92 per share)• Business outlook for 2012 improving. 50% sequential revenue growth and substantial profit improvement forecast for Q2-12• Advanced packaging presence, smart phone/tablet growth and Asian production transfer offer significant upside potential• Attractive stock market valuation relative to peers21 June 2012 25

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