AT & S Austria Technologie & Systemtechnik Aktiengesellschaft | Fabriksgasse13 | A-8700 Leoben Tel +43 (0) 3842 200-0 | E-Mail [email protected]
www.ats.net
AT&S first choice for advanced applications
Company Presentation
April 2016
1
Company Overview
Strategy & Market
Annex
Financials
Table of Contents
2
AT&S – a world 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
AT&S – Key Facts
Strong track record 1 Balanced portfolio / Global customer base 2
7%
€ in millions
3
Split revenue: Business Unit, Q1-Q3 2015/16
Split revenue: Customer Region, Q1-Q3 2015/16 based on sold to party
23%
6%
14%
57%
Germany/Austria
Other Europeancountries
Asia
Americas
488 514
542 590
667
489
584
96 103 102 127
168 127 140
47 42 31 54
90 71 76
2010/11 2011/12 2012/13 2013/14 2014/15 Q1-Q32014/15
Q1-Q32015/16
Revenue EBITDA EBIT
+5% +5% +9% +13%
+19%
Revenue growth
60%
40% Mobile Devices &Substrates
Automotive,Industrial, Medical
4
Global footprint ensures proximity to supply chain & cost efficiency
European production facilities: high mix/low volume Asian production facilities: high volume/low mix
Sales network spanning three continents 8,688 employees*
Plant Shanghai, China Staff: 4,636*
Plant Ansan, Korea Staff: 276*
Plant Nanjangud, India Staff: 1,167*
Plant Chongqing, China under construction Staff: 1,289*
Plant Leoben, Austria Headquarters Staff: 911*
Plant Fehring, Austria Staff: 373*
AT&S sales offices AT&S plants
*Average, FTE, Q1-Q3 2015/16; 36 employees in other locations
► volatility due to seasonal effects
5
Balanced high-end product portfolio to level seasonality
Characteristic
Selected Applications
Segment
1) Based on external revenue € in millions in Q1 2015/16
Mobile Devices & Substrates
Advanced Packaging
Selected Market Leaders
GoPro
Sony
LG
Canon
Qualcomm
Blackberry
Lenovo
Huawei
Samsung
Xiaomi
ZTE
Intel
Apple
► stable business due to longer product life time
Includes the segment Advanced Packaging (in the process of being established) as well as group management and financial activities
Others
(Revenue € in millions)
(Revenue € in millions)
Automotive, Industrial, Medical
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
60%
40%
68.0 88.7
120.9 104.5 115.9 112.2 123.4
Q1 14/15 Q2 14/15 Q3 14/15 Q4 14/15 Q1 15/16 Q2 15/16 Q3 15/16
72.6 71.7 65.9 72.6 77.8 79.5 72.7
Q1 14/15Q2 14/15Q3 14/15Q4 14/15Q1 15/16Q2 15/16Q3 15/16
6
Company Overview
Strategy & Market
Annex
Financials
Table of Contents
AT&S Positioning Strategy
Strategic focus on high-end technologies
High-end HDI PCBs and IC-Substrates
~30%
High-end technology share > 70% HDI and Anylayer PCBs, Embedding
Complementary technology share: <30%
SS, DS, ML, Flex, RF
Structure of general PCB market – based on technologies
Single-sided (SS), double-sided (DS), multilayer- (ML), flex and rigid-flex (RF) PCBs
~70%
AT&S Revenue structure in 2014/15 - based on technologies
7
Strategy: Selecting segments and applications
Market segments – selected by AT&S:
Mobile Devices & Substrates Automotive Industrial Medical
Attractive, specific application growth:
> 10 %
Potential for sustainable high EBITDA margins :
> 20 %
Technological fit: dense structures:
35 - 60 micrometer
Criteria for selection
Smartphones, Tablets, Ultrabooks, Wearables ..
Navigation, Advanced Driver Assistance Systems, Infotainment..
Machine-2-Machine Communication, Industrial Computer…
Hearing Aids, Patient Monitoring ..
1 2 3
Specific applications that show attractive, overall growth within our addressed market segments :
8
9
Market Player/Position HDI Technology
Source: Prismark, August 2014; NTI CY2013; AT&S Strategy
Market position HDI Technology
Revenue (US$ in millions)
Rank Country Supplier HDI Non HDI
PCBs IC-
Substrates Total
revenue
1 TWN Unimicron 682 671 795 2,148
2 TWN Compeq 538 509 - 1,047
3 AUT AT&S 530 248 - 778
4 KOR SEMCO 480 173 1,212 1,865
5 JPN Ibiden 426 - 1,080 1,506
6 USA TTM 406 962 - 1,368
7 TWN Zhen Ding 343 1,774 - 2,117
8 TWN Tripod 305 1,077 - 1,382
9 KOR DAP 279 21 - 300
10 TWN Unitech 236 304 - 540
Source: AT&S; Prismark (2015), JMS (2014), YOLE (2015) Advanced Packaging represents the “Embedded die – package” forecast. FC-Substrates represents “FC-BGA” and “FC-CSP” package substrates.
Market per Segments 2014 – 2019 [US$ in millions]
The Total PCB & Substrate Market will reach around 70 bn US $ in 2019
Overall Market development
Market per Technology 2014 – 2019 [US$ in millions]
10
CAGR 4% CAGR 4%
The world is changing – miniaturisation & modularisation as main drivers
11
2003/04 2013 2016 2024
?
Type Mobile Phone Smartphone System in Package All in One
PCB 125x55mm 85x20mm 30x30mm 20x20 ?
Form Factor 1 0.25 0.13 0.06 ?
Line/Space 100/100µm 40/40µm 30/30µm 20/20µm ?
Technology 1-n-1 Anylayer Anylayer&Embedding ?
12
AT&S’ advanced technology solutions
General Description & Technology Application Areas Customer Base Market Size
High-End (HDI) PCBs
PCBs are the interconnection platform for electric, electronic & mechanical components (such as resistors , capacitors, IC’s,
connectors; etc.) Density: Line/ Space > 35 micron
Computer, Consumer, Communication, Automotive
Industrial, Medical
OEM´s Tier 1 Tier 2
AT&S addresses a market of
USD 5.8bn *
Substrate-like PCBs
Substrate-like PCBs are the next evolution of high-end HDI PCBs with higher density: Line/Space 20-30micron
Wearables and applications of the “Internet of Things”
OEM’s Tier 1 Tier 2
Technology in introduction, part of High –end HDI
and Low-end Substrate market
* AT&S addresses part of a total market of USD 47.5bn/ source: Global Production Value 2014, Prismark, March 2015
13
* AT&S addresses part of a total market of USD 7.6bn/ source: Global Production Value 2014, Prismark, March 2015;) ** Source: AT&S; Prismark (2015), JMS (2014), YOLE (2015); Advanced Packaging represents the “Embedded die – package” forecast. IC (FC)-Substrates represents “FC-BGA” and “FC-CSP” package substrates.
General Description & Technology Application Areas Customer Base Market Size
IC Substrates
IC-Substrates serve as interconnection platform with higher density (Line/Space < 15 micron) between
semiconductors (Chips) & PCBs
High-end processors for Computer, Communication,
Automotive, Industrial
OEM’s Semiconductor
Industry
AT&S addresses a market of
USD 5.1bn *
Embedded Component Packaging
(ECP®)
Embedded Component Packaging allows to embed active/passive components (e.g. wafer level dies) within the
layers of a PCB – contributes to miniaturisation
Power Electronics, e.g. for
Automotive, Industrial
OEM’s
Semiconductor Industry
AT&S addresses a
market of USD 210m **
AT&S’ advanced technology solutions
Growth Project Chongqing – IC-S & Substrate-like PCBs
Building 1: IC Substrate plant Specifications: Clean Room Class < 100
Building 2: Substrate-like PCB plant Specifications: Clean Room Class < 10,000 to
< 1,000 in special areas
14
Growth Project Chongqing – Overview
15
Location: Chongqing, Central China
Total investment: € 480m in first phase (until mid 2017)
Expected CAPEX-revenue ratio: mean of 0.9 (at full expansion – incl. second phase)
Start of High Volume Mass Production > IC Substrates: February 2016 > Substrate-like PCBs: expected second half 2016
* at full expansion (incl. a second phase not yet scheduled) ** Capex for tangible fixed assets
Plant I Plant II
Products: IC Substrates Substrate-like PCBs
Capacity: 150,000 sqm/p.a.* 200,000 sqm/p.a.* Investment** Phase 1: ~ € 280m ~ € 200m Investment** as of 31/12/2015: € 195.6m € 45.3m
16
Driving Future Trends in Customer Segments: Internet of Things (IoT) and Application Structures
Healthcare
Glasses Wearable Electronics
Smart Mobility Autonomous Driving
Car2Car Communication
Smart City Smart Lighting
Smart Buildings Home/Building Automatisation
Energy Management
Smart Production/Industry 4.0 Automatisation/Robotics
Production Control Systems
Smart Healthcare Connectivity (e.g. online patient monitoring)
Smart Energy Smart Metering
30-50 billion of „Things“ will be connected in 2020
Wearables market forecast: USD 10 – 60 billion by 2018 Source: IHS, 2013
17
Company Overview
Strategy & Market
Annex
Financials
Table of Contents
18
Sound top-line growth, above industry margins and increasing cash conversion
488 514
542 590
667
489
584
96 103 102
127
168
127
140
19.7% 20.1% 18.9%
21.6%
25.1% 26.0% 24.0%
€ in millions
71
87
72
105
144
95
130
Revenue Y-O-Y growth
Operating Cash Flow Y-O-Y development
EBITDA and EBITDA-margin
Continuous growth path up to full capacity utilisation
Revenue with products out of Asian production increased from 69% in 2010/11 to 81% in Q1-Q3 2015/16
EBITDA increase due to good product mix and high capacity utilisation
EBITDA margin guidance FY 2015/16: >19% due to impact from ramp-up Chongqing plant
Operating cash flow generation driven by strong EBITDA performance
€ in millions € in millions
19
Capex & Staff
CAPEX CAPEX reflects investments in Chongqing project (whereof € 122.1m) and technology investments in existing locations .
113
40
90
165
130
177
2011/12 2012/13 2013/14 2014/15 Q1-Q32014/15
Q1-Q32015/16
STAFF* The increased headcount is primarily based on the Chongqing project.
7,417 7,321 7,027
7,638
8,688
2011/12 2012/13 2013/14 2014/15 Q1-Q3 2015/16
123 609 54 1,289
* incl. leased personnel, FTE, average for the period (€ in millions)
Core business Employees project Chongqing
Financials Q1-Q3 2015/16
20
€ in thousands (unless otherwise indicated)
01.04.2015 – 31.12.2015 01.04.2014 – 31.12.2014
STATEMENT OF PROFIT OR LOSS
Revenue 584,333 489,416
produced in Asia 81% 79%
produced in Europe 19% 21%
EBITDA 140,233 127,284
EBITDA margin 24.0% 26.0%
EBIT 76,074 70,811
EBIT margin 13.0% 14.5%
Finance costs - net (2,664) (4,376)
Income Taxes (13,182) (16,097)
Profit for the period 60,228 50,338
Cash Earnings 124,292 106,751
EPS in € 1.55 1.29
EBITDA increase of 10.2% based on high capacity utilisation and good product mix; Positive FX effects of € 10.9m included.
Revenue increase of 19.4%: 7.6% from organic growth and 11.8% from FX effects.
Higher interest expenses overcompensated by higher interest income and capitalised interests for qualified assets
EBITDA margin decline in comparison to very high benchmark of 26.0% in Q1-Q3 2014/15
21
Profit for the period and earnings per share
Earnings per share increased by 19.6%
23.3 23.3 23.3
30.8
38.9 38.9 38.9
1.51 1.14 0.62 1.24 1.78 1.29 1.55
-20
-15
-10
-5
0
0
10
20
30
40
50
2010/11 2011/12 2012/13 2013/14 2014/15 Q1-Q32014/15
Q1-Q32015/16
Number of shares, average number; in million pcs. Earnings per share; in €
Financials Q1-Q3 2015/16
22
€ in thousands (unless otherwise indicated) 31.12.2015 31.03.2015
STATEMENT OF FINANCIAL POSITION
Non-current assets 836,746 712,757
Current assets 639,343 508,055
Equity 599,649 604,358
Non-current liabilities 548,189 413,070
Current liabilities 328,251 203,384
Total assets 1,476,089 1,220,812
Net debt 192,420 130,510
Net gearing 32.1% 21.6%
Net working capital 81,271 95,319
Net working capital per revenue 10.4% 14.3%
Equity ratio 40.6% 49.5%
Improvement of net income was overcompensated by negative FX effects
23
Financial debt, cash and net debt
212
273 299
372
405
18 31
82
261 274
194
243
217
111 131
2010/11 2011/12 2012/13 2013/14 2014/15
Gross debt Cash Net debt
24
Net debt/EBITDA
2.0
2.3 2.1
0.9 0.8
2010/11 2011/12 2012/13 2013/14 2014/15
Expected multiple in temporary peak of Chongqing investments: < 3.5x
25
Overview Debt Portfolio Duration
Maturity
€ in millions < 1 Year 1-5 Years > 5 Years Total
Corporate Bond 82.3 - - 82.3
Export Loans
32.0 - - 32.0
Public funds and other - 2.7 1.4 4.1
Bank Borrowings 16.8 381.9 102.3 501.0
Total 31/12/2015 131.1 384.6 103.7 619.4
Total 31/03/2015 46.0 321.6 37.7 405.3
Average debt portfolio duration: 4.0 years (2014/15: 3.8 years) Average financing costs of 2.7% 153m € of credit lines not utilised
Refinancing 2015/16
Financials Q1-Q3 2015/16
26
€ in thousands 01.04.2015 – 31.12.2015 01.04.2014 – 31.12.2014)
STATEMENT OF CASH FLOWS
Profit for the period 60,228 50,338
Non cash bearing of profit or loss 63,195 65,442
Changes in Working Capital 6,475 (20,406)
Cash flow from operating activities 129,898 95,374
Cash flow from investing activities (175,667) (130,433)
Cash flow from financing activities 204,117 16,838
Change in cash and cash equivalents 158,348 (18,221)
Decrease in Net Working Capital due to improved customer payment term.
Continuous planned high CAPEX based on investments in Chongqing and continuous upgrades of existing production facilities.
27
Net Working Capital Management
Net Working Capital Development - € in millions and in % of revenue
92
103
92 95
81
18.0% 19.0%
15.6%
14.3%
10.4%
2011/12 2012/13 2013/14 2014/15 Q3 2015/16
Net Working Capital development Net Working Capital % of revenue
AT&S - Stock Profile
Listing: Vienna Stock Exchange,
Prime Standard
Indices: ATX, WBI
ThomsonReuters (A): ATSV.VI
Bloomberg (A): ATS AV
Annual Results 2015/16 10 May 2016
Record Date Annual General Meeting 27 June 2016
22nd Annual General Meeting 07 July 2016
Ex-Dividend Day 26 July 2016
Record Date Dividend 27 July 2016
Dividend Payment Day 28 July 2016
Results for the first quarter 2016/17 28 July 2016
Results for the first half-year 2016/17 03 November 2016
28
Financial Calendar 1 year development / Daily volume
ATX
AT&S
# of shares outstanding 38.85m
Avg. daily volume: 65.400 shares
Performance ytd: -11.40%
Performance 1 year: -11.76%
Dividend 2014/15: EUR 0.36/per share
Dividend yield: 2.5%
29
14.9% of Free Float not identified
AT&S – Shareholder structure
30
Outlook FY 2015/16
Management expects the satisfactory capacity utilisation to continue for the financial year 2015/16 provided that the macroeconomic environment remains stable and customer demand continues at a good level.
On the basis of the organic growth in the first nine months, an expected seasonality in the next three months, management confirms its revenue guidance of EUR 740 million.
Influenced by the expected costs of the start-up of the new plants in Chongqing, the EBITDA margin should exceed 19% (guidance at the beginning of the financial year: 18-20%). This includes an EBITDA margin in the core business at a similar level of the previous year.
31
Company Overview
Strategy & Market
Annex
Financials
Table of Contents
32
AT&S Product Portfolio
HDI any-layer printed circuit
boards
HDI microvia printed circuit boards – high density interconnect
Multilayer printed circuit boards
Double-sided printed circuit boards
IMS printed circuit boards – insulated
metal substrate
Further technological enhancement to HDI microvia: All electrical connections in HDI any-layer boards consist of laser-drilled microvias. Advantage: further miniaturisation, and higher performance and reliability. AT&S produces HDI any-layer in 4 to 12 layers.
HDI: high density interconnect, meaning laser-drilled connections (microvias). HDI is first step towards miniaturisation. AT&S can produce 4-layer laser PCBs up to 6-n-6 HDI multi layer PCBs.
Found in almost every area of industrial electronics. AT&S produces printed circuit boards with 4 to 28 layers, in quantities from individual prototypes to small batches and mass production.
Used in all areas of electronics. AT&S focuses on double-sided printed circuit boards with thicknesses in the range of 0.1-3.2 mm.
IMS: insulated metal substrate. Primary function: heat dissipation for use mainly with LEDs and power components.
Production site Shanghai
Shanghai, Leoben
Leoben, Nanjangud, Fehring
Fehring, Nanjangud
Fehring
Applications Smartphones, Tablets, Notebooks
Mobile phones and nearly all electronic applications including automotive (navigation, infotainment and driver assistance systems)
Used in all electronic applications including touch panels, and in products ranging from aircraft to motorcycles, from storage power plants to solar arrays
Primarily industrial and automotive applications
Lighting industry
33
AT&S Product Portfolio
Flexible printed circuit boards
Semi-flexible printed circuit boards
Rigid-flex printed circuit boards
Flexible printed circuit boards on aluminium
AT&S patented technologies
Used to replace wiring and connectors, allowing for connections and geometries that are not possible with rigid printed circuit boards.
More limited bend radius than flexible printed circuit boards. The use of a standard thin laminate makes them a cost-effective alternative.
Combine the advantages of flexible and rigid printed circuit boards, yielding benefits for signal transmission, size and stability.
Used when installing LEDs in car headlights, for example, where the printed circuit board is bonded to an aluminium heat sink to which the LEDs are then attached.
Production site Ansan, Fehring
Fehring
Leoben, Ansan
Ansan
Applications Nearly all areas of electronics, including measuring devices and medical applications
Automotive applications
Industrial electronics, such as production machines and industrial robots
Lighting, automotive, building lighting
ECP: Embedded Component Packaging ECP® is a patented AT&S packaging technology used to embed active and passive electronic components in the inner layers of a printed circuit board. ECP® technology is used in ever smaller, more efficient and more powerful devices, such as smartphones, tablets, digital cameras and hearing aids. Production site: Leoben
2.5D® Technology Platform Combines mechanical and electronic miniaturisation, and enables partial reduction of the thickness of a circuit board. Advantage: populated assemblies have a thinner profile. Can be also used to make cavities in the printed circuit board, e.g. for acoustic channels. Major application for this technology is the 2.5D® rigid-flex printed circuit board, a lower cost alternative for flex-to install applications. Production sites: Leoben, Shanghai
Management
34
Andreas Gerstenmayer, CEO
Joined AT&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
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
35
Milestones
Five core dimensions of sustainability within AT&S
Energy and carbon footprint
Water
AT&S – a learning organisation
Resources
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
36
The importance of sustainability is rising within:
Authorities (basis for securing operation licences)
Customers (relevant for placing orders)
AT&S saves CO2 and Water…
37
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%.
765.2
834.7
783.9
734.0
2011/12 2012/13 2013/14 2014/15
Freshwater consumption
In liters per sqm weighted PCB
1)
47.4
51.0 50.7
49.0
2011/12 2012/13 2013/14 2014/15
CO2-Footprint
1)
In kg per sqm weighted PCB
1) Since 2012/13 calculation according to EICC standards before that AT&S internal calculation
Visit: www.ats.net; Twitter @AT&S IR_PR; YouTube AtundS
38
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 [email protected] www.ats.net
Disclaimer
39
This presentation is provided 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
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