1

Turning around Lumileds

Pierre-Yves Lesaicherre, CEO Lumileds

Philips Lumileds Penang

New Manufacturing Facility

2

Key takeaways

• Lumileds is a leader in High-Power LEDs

with global top 3 position in Flash,

Automotive and General Illumination

• Broad LED portfolio optimized per application

• Leading edge technology with a strong IP

portfolio and a leading patent portfolio related

to LED technology

• We are on track to be profitable in the fourth

quarter of 2012

Luxeon K LED Family

Altilon Automotive Solution

3

Philips Lumileds serves 4 major markets Leveraging technology and scale across multiple segments

Display

• High Power direct

backlight

• Leading Lm/$

• Volume segment

• Level 1 and level 2

• Backlight, DRL,

headlamps, turn

signals

• IP innovation

• Quality, Reliability

• Level 1 and level 2

Automotive Flash

• Market leader

• Patent portfolio

• IP innovation

• Level 1 and level 2

• Fastest growing

• Multiple segments

• Level 1 and Level 2

Illumination

4

Packaged LED industry landscape

Packaged LED 2010-2015 CAGR 15% 4 players share ~80% of the Illumination

market

14%25%

10%

29%21%

B Philips D A Rest of Market

Source: Strategies Unlimited, LEDs in Lighting 2012

33%

67%

High power Medium power

2012 Est. 2012 Est.

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Packaged LED industry landscape HP / MP / LP Share in Illumination

SnapLED Automotive Solution

Luxeon H – High Voltage Solution

Luxeon M Outdoor Solution

Source: Strategies Unlimited, LEDs in Lighting 2012

0.4

0.1

1.5

2010

1.4

0.3

1.1

2012 Est.

2.2

0.4

0.2

1.6

2011

2.0

Low Power

Medium Power

High Power

Market expected to grow at a CAGR of 15% towards 2016

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We have a broad LED portfolio optimized per application End2End roadmaps through joint innovation with Philips application teams

Outdoor

Street, Tunnel,

Parking and Area

Lighting

Industry

High Bay, Low Bay

Lighting

Retail &

Hospitality

Downlights,

Spotlights

LED Retrofit

bulbs

A-style, Directional

and Decorative

lamps

Segments Characteristics

Efficiency,

directional, high

lumen

System cost,

directional, high

lumen

Quality of light,

high CRI, narrow

beam

Single optics, high

lumen density,

system cost

LUXEON K

LUXEON H

LUXEON Mid-Power

LUXEON M

LUXEON R

LUXEON M

LUXEON R

LUXEON S

LUXEON K

Solutions

launched in 2012

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We have a broad LED portfolio optimized per application End2End roadmaps through joint innovation with Philips application teams

Office

Troffers, TLEDs

Architecture /

Entertainment

Color Wall Washers,

Color Moving Heads

Homes

Ceiling and home

fixtures

Segments Characteristics

Efficiency, system

cost, lumen

maintenance

Color maintenance,

lumen density, small

form factor

Color quality &

consistency,

system cost

LUXEON H

LUXEON Mid-Power

LUXEON Z

Solutions

launched in 2012

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We will further strengthen our technology leadership By winning four key-battles

Core Competency in

Conversion Efficiency

Device Architecture

Leadership

Epitaxy Enables

Breakthrough in lm/W

Efficacy

Optimized Package

Solutions

World Class Epitaxial Growth Delivers

• Leading Wall Plug Efficiency

• Superior Hot / Cold Factor

• Leading Reliability & Lumen Maintenance

Phosphor Drives Conversion Efficiency

• Focused on Advanced Phosphor Materials

• Leading in Ceramic Phosphor Integration

• Optimized Solutions for Illumination, Flash and

Automotive

Thin Film Flip Chip (TFFC) is a Driver for

• Efficacy (lm/W)

• Superior Luminance (lm/mm2)

• Unique platform for Phosphor Application

Application-Optimized Package Solutions

• Ceramic Solutions for High Power

• Lead-Frame for Mid-Power

• Investing in Next-Generation Packaging

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Lumileds turnaround actions

+2%

+2%

Q4’12 Est. Q3’12 Est. Q2’12

PLL annual EPI volume

Million mm2

+59%

2012 Est. 2011 2010 2009

• Significant changes to management team

over last nine months. New hires with

deep Semiconductor expertise.

– New CFO, Head of Operations,

Head of Marketing, Head of sales

• Operational excellence and cost

improvements

– Full conversion to 6”, integral yield,

factory utilization, product quality,

narrowing bin distribution

– Improving capacity utilization and

economies of scale by delivering on

latest design wins

Quarterly integral yield improvement

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Lumileds turnaround actions

Indexed Annual Capex Spend (2010 = 100) • R&D roadmaps and execution

– Joint roadmaps with key customers

– Portfolio optimization: Balancing high

margin and high volume segments

– Targeted innovation in Epitaxy,

Phosphor and packaging

• Sales and marketing reorganization:

Stronger customer focus

– Go to Market strategy changes for

broader market access

– Margin management: ASP, focused

cost reduction, mix optimization

• IT Infrastructure upgrade

Indexed Quarterly Gross Margin trend

+124%

Q4’12 Est. Q3’12 Est.

Q2’12

2011 2010 2012 Est.

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• Lumileds is a leader in High-Power LEDs

with global top 3 position in Flash,

Automotive and General Illumination

• Broad LED portfolio optimized per application

• Leading edge technology with a strong IP

portfolio and a leading patent portfolio related

to LED technology

• We are on track to be profitable in the fourth

quarter of 2012

Key takeaways

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