investor presentation – half-year results 2015...investor presentation – half-year results 2015...
TRANSCRIPT
Investor presentation – Half-Year Results 2015
The following documentation contains forward-looking statements that are subject to certain risks and uncertainties. Actual results may differ materially from those anticipated in this presentation.
2
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
Agenda
3
Micronas at a glance
4
About 900 employees worldwide
Leading supplier of Hall sensors for the automotive industry
Core business Automotive Focus on sensors and sensor-based solutions
Full in-house production with own waferfab and backend operations including testing and packaging
zero ppm quality to ensure customer satisfaction
Commitment to environmental protection
Most Preferred Partner for Sensing and Control
Sales offices across Europe
Micronas Ltd. Glenrothes, Scotland
Test center, Production
Micronas New Technologies GmbH, Munich, Germany
Research & Development Sales
5
Group structure and locations
Micronas GmbH Freiburg, Germany
Research & Development Marketing & Sales Production
Micronas Japan K.K. Tokyo, Japan, Sales office
Micronas Semiconductor Holding AG, Zurich, Switzerland
Headquarters
Sales office Shanghai, China
Sales office Detroit, USA
Sales office Seoul, Korea
Business update
Group sales up by 2 percent after currency adjustments
Earnings negatively impacted: EBIT hurt by the switch to 8-inch Net profit influenced by cash holdings in euro
A total of 510 396 shares were repurchased, equivalent to 1.7 percent of the Company's share capital
Capacity utilization at own manufacturing facilities stood at around 85 percent
The combined heat and power plant achieved very high overall efficiency and is exceeding target levels
6
Removal of the minimum exchange rate between the euro and the franc reduced figures in the income statement and balance sheet
Product innovations
Great customer interest in the new Hall-effect sensor products announced last year
Extension of our clear market leadership in China by acquiring additional platforms for gas pedal applications
More projects involving our 2D-HAL products started up for new applications such as valve control and coolant valves
New contracts with Rutronik, Digi-Key and Mouser to further boost sales in the automotive and industrial sectors 7
"Global Cooperation Award" from our largest customer Denso in recognition of the reliability of our supplies and our excellent support
Product announcements
Announcement of first redundant Linear Hall-effect sensor family, produced on a package less than 1 millimeter thick with two completely independent silicon chips integrated
First member of the new embedded motor controller generation with integrated power bridges offers a unique level of integration and unprecedented flexibility for the direct control of compact, cost-effective electric motors (BLDC, BDC and stepper motors) 8
Micronas was present at the most important trade fairs, including Sensor+Test in Nuremberg and Automotive Engineering Exhibition in Yokohama to present its latest product innovations to an interested specialist audience
Agenda
9
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
Micronas has a long history in Automotive with a very large customer base
Micronas maintains full control of production from wafer fab, assembly and final testing providing highest flexibility to meet automotive quality and to offer unique customization capability
Micronas offers the world´s largest Hall sensor portfolio covering most automotive applications
Micronas also provides innovative fully integrated servo-drive solutions for motor control applications
Markets Automotive
Automotive
10
Powertrain
Chassis and safety
Body and comfort
Intelligent sensor and actuator solutions for smart automation networks to enable increased comfort and lifestyle
Highly reliable and robust sensors to meet the demands for long lifetime within harsh environments
Wide range of cost-effective sensor solutions for eco-friendly home appliances with small form factor
Markets Industrial
Industrial
11
Building, home and office Automation
Home appliance and white goods
Factory and process automation
Garden and power tools
Agricultural and heavy machinery Mobility and robotics
Markets and technology drivers
Comfort and lifestyle
High levels of functionality, low power and small form factor enable new applications and comfort features
Economy
Reduced overall system cost enabled by highly integrated sensors and embedded controllers, e.g. increasing magnet costs can be compensated by higher sensitivity
12
Increased safety demand drive growth for novel, intelligent and redundant products and system solutions
Increased demand for high energy efficiency and CO2 reduction needs optimized sensors and actuator solutions, e.g. for engines, BLDC motors and HVAC systems
Environmental protection
Safety
8%
5% 4%
7%
-12% -20%-15%-10%-5%0%5%10%15%20%25%30%35%
0
2
4
6
8
10
WesternEurope
thereofGermany
USA China Japan
Registration in Mil./units
Growth (1st half 15/14)
New passenger car registration first six months 2015
13
Market development
Source: VDA – Verband der Automobilindustrie, July 2015
100%
110%
120%
130%
140%
150%
160%
170%
2015 2016 2017 2018 2019 2020
BLDC motors Automotive (Mil. USD)
Hall sensors Automotive (Mil. USD)
Elektronc systems Automotive (Mil. USD)
Vehicle production (Mil. units)
Market development
14 Source: Strategy Analytics / IHS / WSTS / Micronas, July 2015
Mar
ket f
igur
es n
orm
aliz
ed to
201
5
CAGR 2015 – 2020 = 4%
CAGR 2015 – 2020 = 6%
CAGR 2015 – 2020 = 7%
CAGR 2015 – 2020 = 10%
Hall sensors and BLDC motors will continue to outgrow vehicle production and electronic systems in cars
15 15
Customer and distributor base
16 16
Automotive manufacturers – OEMs
Agenda
17
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
Micronas product portfolio
Embedded motor controllers Hall-effect sensors
Gas sensors
Up to 100 electric motors per vehicle Market growth dominated by BLDC and
stepper motors All-in-one solution
provides higher system efficiency to reduce motor size and weight
Major automotive trends for CO2 reduction and car electrification are asking for tighter controls, thus increasing the demand for magnetic sensors
More than 85% of magnetic sensors in cars are based on the Hall effect
Micronas offers the broadest portfolio of Hall sensors for automotive applications covered by switches, linear, direct angle and current sensors
Multi-parameter gas, temperature and relative humidity sensor
Single-chip sensor results in small and low power solution
Applications include fire detection, HVAC and leakage
18
Safety
New product development and documentation are meeting the requirements of ISO26262, the de-facto standard for automotive functional safety
Micronas has developed a concept for its devices to become insensitive against disturbing magnetic stray fields caused by the increased car electrification (HEV/EV)
Capacitors are integrated into the sensor package in order to fulfill stringent EMC/ESD requirements and to reduce overall system costs
Two silicon dies are integrated into a single package to respond efficiently to redundancy requirements for most critical applications (pedal, throttle, steering)
Redundancy
Robustness Integration
Hall-effect sensors – trends
19
Easy to implement contact-less switch Replacement of microswitches
Hall-effect sensors – products
Switches
20
power tools
Precise angle detection with a single sensor
Replacement of inductive or optical angle encoders
Angular steering angle
Highly accurate position detection
Replacement of conventional potentiometers
Linear bending lights
pressure
Small form factor contact-less current transducer
Replacement of shunt-based solutions
Current battery management
current monitor joystick
buckle switch throttle flap
Micronas offers the broadest portfolio of Hall sensors for automotive and industrial
Cost effectiveness
Reducing Cost of Ownership and software development time is a major concerns for our customers. Our products are flexible and configurable to drive different type of motors.
Micronas products are enabling different driving schemes and optimization functions enabling smaller motors to reach higher torque requirements.
Micronas is focusing on enabling complex drive to ever smaller motors with small footprint, reducing the number of necessary external components to a minimum.
BLDC motors enables weight, space and noise reduction in interior applications. Micronas products ensure a smooth transition from BDC and Stepper motors towards BLDC motors.
Weight and noise reduction
Efficiency Miniaturization
Embedded motor controllers – trends
21
HVC 2480B All-in-one
Embedded motor controllers – products
Micronas solutions are single-chip, high voltage controllers with flexible peripherals and direct motor driving capabilities.
22
Higher efficiency
32-bit ARM CortexTM-M3 core enables high end motor control strategies to further reduce noise and increase efficiency
Smaller footprint
Integration of digital logic as well as analog, HV and NVM capabilities in a dedicated CMOS process in co-operation with X-FAB
next
Application fields Automotive
Active pedal Powertrain valves Battery management Gear position Water/oil pumps Shift lever position Turbo charger Liquid level Thermo management/
valves
Steering torque Steering angle Steering motor position Chassis position sensor Braking pedal
Window lift/sun roof LED fans Door lock Buckle switch Adaptive headlights HVAC Blower and flap control Seat position/climate Grill shutter Climate flaps
Hall-effect sensors (switches, linear, direct angle, current) and embedded motor controllers
23
Chassis and safety Body and comfort Powertrain
Application fields Industrial
HVAC Rolling shutter/
blinders Door/window locks Water metering
Hall-effect sensors (switches, linear, direct angle, current) and embedded motor controllers
24
Joystick/pedal Throttle/valve Cylinder position Proximity switch
Building, home and office automation
Factory and process automation
Door lock Flow measurement Motor commutation Push button
Home appliance and white goods
Factory and process automation
E-bike Wheel chair Utility tractor Robot
Mobility and robotics
Mower Chain saw Trimmer Blower
Pedal sensor Throttle sensor Transmission
shifter Joystick
Garden and power tools
Agricultural and heavy machinery
Agenda
25
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
Currency exposure
26
Selected effects EUR/CHF first half-year 2015 vs. full year 2014:
Translation effects balance sheet and income statement = -12 to -14%
Competitive effects = 0
EBIT margin effect = ~0 percentage points
Equity effect = CHF -13 mil. / Equity ratio = -4 percentage points
85%
1%
7% 5% 2%
Cost base per currency, forecast 2015
EURJPYUSDGBPCHF
81%
13%
6% Net sales per currency, forecast 2015
EURJPYUSD
Micronas Group – income statement
27
Mil./CHF in % of Mil./CHF in % ofnet sales net sales
Net sales 70.8 81.1Gross margin 19.4 27.3% 24.7 30.4%
Research and development expenses -10.8 15.3% -13.4 16.5%Marketing and sales expenses -4.6 6.5% -5.1 6.3%Administrative and general expenses -2.6 3.7% -3.1 3.8%Other operating income/expenses 0.5 0.7% 0.2 0.2%Operating profit (EBIT) 1.9 2.7% 3.3 4.1%
Financial income/expenses/FX net. -7.6 -0.9Pretax profit/loss -5.7 -8.0% 2.4 3.0%Income taxes 0.5 -0.1
Profit/loss for the period -5.2 -7.3% 2.3 2.8%
EBITDA 6.7 9.5% 8.9 11.0%
Earnings per share in CHF -0.18 0.08
1st half 2015 1st half 2014
28
Micronas Group – segment information
Decrease in Automotive sales of 12 percent on the first half of 2014
The currency-adjusted figure shows a slight increase of 3 percent
The Industrial segment achieved sales of CHF 4.4 million compared with CHF 5.5 million in the equivalent prior-year period
After currency adjustment a decline of 7 percent was recorded
Mil./CHF 1st half 2015 1st half 2014
Automotive
Net sales 66.5 75.6
Gross margin 18.0 22.5in % of sales 27.1% 29.7%
Operating profit (EBIT) 1.6 3.2in % of sales 2.5% 4.2%
Mil./CHF 1st half 2015 1st half 2014
Industrial
Net sales 4.4 5.5
Gross margin 1.3 2.2in % of sales 30.2% 39.6%
Operating profit (EBIT) 0.3 0.1in % of sales 6.0% 1.9%
88%
6% 6%
Sensors Automotive Controllers Automomotive Sensors Industrial
29
Micronas Group – product lines
Automotive sensor sales were down by 13 percent, currency adjusted, there was a growth of 2 percent
Overall controller sales for the first time grew due to embedded motor controllers by 5 percent, currency adjusted even by 25 percent
Industrial sales of hall sensors declined by 20 percent, currency adjusted by 7 percent
Sales part by product lines
Mil./CHF 1st half 2015 1st half 2014 Change in % Change in %currency adjusted
Sensors Automotive 62.4 71.8 -13% 2%Controllers Automotive 4.0 3.8 5% 25%Sensors Industrial 4.4 5.5 -20% -7%
Total sales 70.8 81.1 -13% 2%
54% 21%
4% 6% 15%
Sales in Europe
Germany Hungary Czech Republic France Others
83%
13% 4%
Sales in Asia
Japan China Others
58%
33% 9% 0%
Sales total
Asia Europe America Others
30
Micronas Group – regional information
Mil./CHF 1st half 2015 1st half 2014 Change in % Change in %Currency adjusted
Europe 23.6 26.8 -12% 4%Asia 40.9 46.7 -12% 3%America 6.2 7.5 -17% -3%Others 0.1 0.1 0% 0%
Total sales 70.8 81.1 -13% 2%
Micronas Group – balance sheet
31
Equity at CHF 94 million – decline due to currency effects on valuations
Equity ratio at 37 percent
Mil./CHF 26.6.2015 31.12.2014
Total non-current assets 82.9 95.9Cash, cash equivalents and short-term financial investments 126.6 152.1Other current assets 45.7 49.7
Total assets 255.2 297.7
Total shareholders' equity 94.1 109.8in % of total assets 36.9% 36.9%Total long-term liabilities 143.6 167.7Total current liabilities 17.5 20.2Total liabilities 161.1 187.9
Total shareholders' equity and liabilities 255.2 297.7
Cash, cash equivalents and short-term financial cash deposits 126.3 151.4
Mil./CHF 26.6.2015 31.12.2014
Inventories 27.1 33.5Accounts receivable 14.8 14.6
Accounts payable 6.1 9.2
Trade net working capital 35.8 38.9
Trade net working capital represents 24 percent of LTM net sales
Micronas Group – cash flow statement
32
Mil./CHF 1st half 2015 1st half 2014
Net cash at the beginning of the period 151.4 170.4
Cash flow from operating activities -4.4 -2.2
Cash flow from investing activities -3.4 -9.0
Cash flow from financing activities -4.4 -1.50Exchange effect on cash -12.9 -0.7Change in net cash -25.1 -13.4
Cash, cash equivalents and short-term financial cash deposits 126.3 157.0
Net liquidity went down by CHF 25 million to CHF 126 million – this decrease is mainly due to currency effects
0.0
0.2
0.4
0.6
0.8
1.0
1.2
Q3-14 Q4-14 Q1-15 Q2-15
Book-to-bill
33
Micronas Group – order book
ratio
Mil./CHF 1st half 2015 1st half 2014
Orders on hand, beginning of period 49.0 48.1
Net sales 70.8 81.1Order intake 65.7 80.8Translation adjustments -6.5 -0.4
Orders on hand, end of period 37.4 47.4
Book-to-bill 0.93 1.00
Orders on hand at the end of the period of CHF 37 million – book-to-bill ratio for first half-year at 0.93
Agenda
34
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
The decline in demand for cars in Japan is hitting Japanese automobile manufacturers as well as their suppliers, so Micronas Group's sales in the second half of year will not be as high as in the first
With an EUR/CHF exchange rate of 1.05, for the full year sales of ca. CHF 135 million are expected Currency adjusted, this means a decline in sales of 2
percent compared with the prior year
The EBIT-margin, still affected by the change in manufacturing processes, will be in the low single-digit percentage range
Owing to the valuation of cash holdings denominated in foreign currencies, the net result is still expected to be negative
Outlook for full year 2015
35
Grow faster than the Automotive market Grow sales in Europe and America above
average Ensure leading position for Hall-sensors in the
automotive market
Capture new markets with our sensor based solutions like our embedded motor controllers
Keep high investments in innovation while increasing profitability
Long-term targets
36
We believe that despite the short-term negative effects of manufacturing changes and of the franc shock, Micronas, thanks to its strategy and innovative product portfolio, is on track to achieve the long-term goals announced in February
Year-on-year sales growth of > 8 %
Gross margin of > 40 %
R&D expenditures of 16 – 18 %
EBIT margin of 15 %
Summary
37
Our customers trust us. More than 3 billion sensors sold from the world market leader of linear Hall-effect sensors.
Quality without compromises. Our products are known for superior quality, functional safety and excellent reliability.
All under one roof. More flexibility and fast time-to-market.
Excellence by experience. Innovative solutions and excellent support, based on deep market and broad system know-how.
Agenda
38
Company overview
Markets and customers
Products and applications
Financial details
Outlook and summary
Backup information
Total shares outstanding as at June 30, 2015: 29 757 930
Shareholder structure
Shareholders by country Shareholders by category
29.3%
18.1%
1.9%
7.2%
2.4%
0.2%
40.9%
Switzerland
Great Britain
Germany
Rest of Europe
USA
Rest of world
Shares notregistered
22.2%
5.0%
8.4%
0.1% 0.5%
0.3% 22.6%
40.9%
Persons
Companies
Funds
Foundations
Pension funds
Insurance comp.
Banks
Shares notregistered
39
Major shareholders
40
Number of shares
Brandes Investment Partners, L.P.1 San Diego, USA 3 155 277 10.60
RBC Dexia Investor Services Trust2 London, Great Britain 2 381 658 8.00
Nortrust Nominees Ltd.2 London, Great Britain 2 141 058 7.19
Sparinvest Holdings SE1 Luxembourg 1 583 383 5.33
Black Creek Investment Management Inc.1 Toronto, Canada 1 495 070 5.04
Wellington Management Group LLP1 Boston, USA 1 065 105 3.58
As at June 30, 2015, the Company is aware of the following shareholders holding 3 percent or more of the capital and/or voting rights of the Company:
Shareholder Registered office Percentage
1 The above figures (number of shares and percentages) conform to the figures contained in the respective notifications to the Company and the Disclosure Office of the SIX Swiss Exchange; they may not be accurate as at June 30, 2015.
2 Nortrust Nominees Ltd. and RBC Dexia Investor Services Trust are acting in their capacity as nominees for other investors. The above figures (number of shares and percentages) conform to the figures as at June 30, 2015.
October 22, 2015 Quarterly key figures Q3-2015
February 25, 2016 Publication of financial year 2015
February 25, 2016 Closing date of share register
March 30, 2016 Ordinary Shareholders’ Meeting
10 a.m., Technopark, Zurich
IR calendar
41
IR contact Susy Krucker, Head of Investor Relations, [email protected] for further information, please check: www.micronas.com / Investor