Imagine  Memory  Everywhere™  

Thin Film Electronics ASA (“Thinfilm”): Bringing electronic functionality to new markets Jennifer Ernst EVP, Thin Film Electronics ASA Organic Electronics Association Working Group Meeting April 2013

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►  hasn’t this market gap been addressed? •  Cost & lack of scalability for silicon

electronics •  Device aggregators (e.g., smart phones)

only recently becoming widespread

The $100bn Market Gap

60 million [# cars sold in 2012]

1 Global semiconductor market (2012) Source: IDC; Gartner; World Bank; IMF; The Semiconductor Industry Association ; OICA; IC Insight; MarketLine; Apparel Market; Planet Forward

2.3 billion [# computing /mobile devices sold in 2012]

15 billion [# microcontrollers sold in 2012]

80 billion [# apparel items sold in 2012]

5-10 trillion [# disposable items sold in 2012]

Value of embedded electronic intelligence1:

$315bn [~21% of retail value]

Penetration of electronic intelligence in physical objects

Existing market

The market gap

Value potential of adding intelligence:

$100bn [~1% of retail value]

► Bringing intelligence to everything, including disposable products, would enable a for consumers

Why

smarter everyday

► This emerging world, where practically every item has intelligence, is supported by a megatrend – often referred to as the

Internet of Things (IoT)

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Thinfilm Uniquely Positioned For The $100bn Market Opportunity

Printed Electronics only way of enabling ubiquitous electronics: •  Ultra-scalable

manufacturing process and low CAPEX

•  Compatibility with silicon electronics (enabling all objects to communicate with each other)

…combined with…

•  Unparalleled product progression & technical achievements:

•  Strong IP position in unique and critical memory technology •  Secured other technology components for integrated systems:

•  Disruptive technology with unique cost/functionality trade-offs

Memory + Logic

Integrated systems - Sensor tags - Display tags - RFID & NFC

sensor battery display logic

Commercial target 2014: 30-50₵

Lowest cost alternative: $5-$15

Memory

Current pricing 5₵ Lowest cost alternative 6.5₵

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Commercialization Success Factors already demonstrated by Thinfilm

1. Significant customer pull with go-to-market partners secured

2. Proven mass production process; complete value chain established

3. Strong ecosystem of manufacturing and technology partners

[Placeholder Video]

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First product: Data Storage on a Label

20-bit w rewritable w non-volatile w disposable 5¢

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Commercial Manufacturing of Printed Memory

6

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Integration at all levels

Proof of Concept Demonstrated December 2012

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Anatomy of a Smart Label

substrate

gate dielectric

semiconductor drain source

Materials >> Inks >> Devices

Circuits >> Smart Label

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Thinfilm Tags

Devices

Software

Cloud

Addressable Market of $20-25bn S

E R

V I

C E

L A

Y E

R S

~40k

<1mm

~2bn

Trillions

Application

5-10

1-1.5 Personal health care

Dynamic price display

Interactive packaging 2-5

Monitoring of perishable goods 1-2

Market size ($ bn)

2-5

Anti-theft/ brand protection 2

Logistics (RFID)

NFC & "Internet of Things" 10+

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Contactless tags Dynamic display tags

Key product categories:

# tags sold (millions) 30 2,600 20,800

•  Change in product mix •  Increased price as more

functionality is added •  Shift to licensing model

<0.1

2020

~1,500

2016

~300

2014

9

2012A

0.7

Sensor tags

NFC & “Internet of things” (smart tags)

Application (examples) Market estimates (global) Thinfilm mkt. share

•  ~$12bn in 2019 (source: IDTechEx: Printed/chipless tags)

•  ~8% (2019)

•  ~$500 in 2010, ~$2.5bn in 2020 (source: ODIN, VDC Research)

•  Limited use tickets issued: ~9bn in 2009 (source: Innovision R&T)

•  ~5% (2020)

•  ~7% volume share (2020)1

RFID tags (retail/logistics, limited use ticketing etc.)

•  ~$10bn in 2020 (Thinfilm estimates)

•  ~3% (2020) Dynamic price displays (retail)

•  ~$5bn in 2020 (Thinfilm estimates)

•  ~2% (2020) Interactive packaging (FMCG/retail)

1  Assuming no growth in number of LU tickets issued worldwide from 2009 to 2020 2  Time-Temperature Indicators (used in transportation/packaging, i.e., excluding other industries, e.g., automotive, HVAC/refrigeration etc.)

Monitoring of perishable goods/drugs (temperature sensor)

•  TTI market2: ~$1.4bn in 2010, ~$3.2bn in 2020 (source: Frost & Sullivan, Freedonia, BCC+)

•  ~4% (2020)

Revenue Target of $1.5bn By 2020 Thinfilm revenue projections, 2012-2020; USD millions

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Commercial Agreements with Fortune 600 Companies

• Global leader in flexible packaging

• 78 manufacturing facilities worldwide

• ~200 billion packages per year

• 2011 net sales of $5.3 billion, mkt. cap. of $3.1 billion (Fortune 500 company)

“Our agreement with Thin Film Electronics ASA is an investment in technology that could eventually make printed electronics a component of every package we manufacture.” Henry Theisen, CEO, Bemis

Bemis Company, Inc. Hasbro, Inc.

• World’s 2nd largest toy and game company

• Known for household brands such as Monopoly, Transformer, Scrabble, Trivial Pursuit and Mr. Potato Head

• 2011 net sales of $4.3 billion (5 800 employees)

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Award Winning Technology Portfolio

► 2012 Wall Street Journal Innovation Awards

► 2012 World Technology Award, sponsored by CNN, Time, Science, and Technology Review

► 2012 IDTechEx Product Development (#1 consulting firm in Printed Electronics)

► 2012 FlexTech Innovation Award (US National Consortium on Printed and Flexible Electronics)

► 2010 Frost & Sullivan Product Development

► 2009 IDTechEx Manufacturing Award

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Thinfilm Recognized As One of The World’s Most Innovative Companies

18 September, 2012

“These are the companies that are changing or could potentially change the mobile landscape in the most profound ways”

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Printed Smart Tags – Why Now? The “Internet of Things”: a Megatrend

“….there has been an acceleration in the number and types of things that are being connected and in the technologies for identifying, sensing and communicating. These technologies are reaching critical mass and an economic tipping point over the next few years” October, 2011

Identifies Top 10 Strategic Technologies

“More objects are becoming embedded with sensors and gaining the ability to communicate. The resulting information networks promise to create new business models, improve business processes, and reduce costs and risks” McKinsey Quarterly, 2010

The Internet of Things

“The evolution of embedded systems from fixed function and disconnected systems to intelligent systems continues to gain momentum and puts intelligent systems on track to bring the Internet of Things to reality” September, 2011

Intelligent Systems: The Next Big Opportunity

2010

0.9 1.1

2011 2015

+19% 2.0

2014 2013

1.8

2012

1.5 1.3

CAGR, 2011-2015

Market size projections1

Intelligent system & Internet of Things, USD trillions

1 Based on numbers from IDC (Intelligent Systems) , September 2011 14

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Q & A