The Future of Vacuum Technology Sustainable Growth

Transcription

1 The Future of Vacuum Technology Sustainable Growth Thomas Babacan, CEO Oerlikon Vacuum Oerlikon Capital Market Days 2008 Zurich, September 25-26, 2008

2 Disclaimer This presentation is based on information currently available to management. The forward-looking statements contained herein could be substantially impacted by risks and influences that are not foreseeable at present, so that actual results may vary materially from those anticipated, expected or projected. Page 2 Oerlikon Capital Market Days 2008

3 Oerlikon Textile Oerlikon Coating Oerlikon Solar Oerlikon Vacuum Oerlikon Drive Systems Oerlikon Components Page 3 Oerlikon Capital Market Days 2008

4 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 4 Oerlikon Capital Market Days 2008

5 Oerlikon Leybold Vacuum Today s Positioning We are the leading Total Vacuum Solution Provider with best Application Know How and Service Capabilities We deliver Premium Quality Products for mid- and high-end Applications Customer Proximity - We are close to the Customer with our Global Sales & Service Footprint Time Tested products lead to Excellent Brand Image We innovate Vacuum Technology Page 5 Oerlikon Capital Market Days 2008

6 At a glance Sales 2007: CHF 458m Employees: 1,511 as of June 30, 2008 Products: Dry and oil-sealed fore vacuum pumps, roots pumps, pumping systems, turbomolecular pumps, cryo pumps, cryostats, gauges, leak detectors, accessories Market Segments: Process Industry Coating Technology Analytical & Medical Research & Development Semiconductor Page 6 Oerlikon Capital Market Days 2008

7 Production locations in Germany, France and China CoC Cryo: Coolvac Manufacturing Site Asia: Ruvac, Trivac C, Sogevac, Solutions Dresden, Germany Tianjin, China CoC Rotary Vane Pumps: Sogevac, Trivac NT CoC Dry (HQ): Screwline, Ruvac, Turbovac, Solutions Valence, France Oerlikon Leybold Vacuum Production Sites Cologne, Germany Page 7 Oerlikon Capital Market Days 2008

8 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 8 Oerlikon Capital Market Days 2008

9 Importance of vacuum technology Enabling Technology for many Manufacturing Processes & Analytical Methods Process Industry Solar Cell Production Research & Development Analytics & Life Style Wear Protection Large Area Coatings Decorative Coatings Space Simulation Page 9 Oerlikon Capital Market Days 2008

10 We are focusing R&D and operations on four technologies targeted on five application segments Industrial Furnaces & Metallurgy Dry Fore Vacuum Pumps Screw and Booster Technology Rotary Vane Pumps Oil-Sealed Displacement Pump Turbomolecular Pumps Turbines at Ultrasonic Speed System Solutions Process Industry Coating Technology Analytical R & D Automotive, Lighting, Refrigeration Laser, Energy & Electro Chemistry & Pharmacy Industrial Machinery Solar Technology Architectural Glass, Coatings Data Storage Displays Mass Spectrometers Electron Microscopes Leak Detectors and Residual Gas Analyzers R&D Equipment Manufacturers Universities & National Labs Space & Defense Semiconductor Manufacturers & End Users of Chip Production Equipment Page 10 Oerlikon Capital Market Days 2008

11 Solutions and services complementing our offer Components Solutions Services Rotary Vane Vacuum Pumps Scroll and Piston Vacuum Pumps Diaphragm Vacuum Pumps Screw Vacuum Pumps Roots Pumps Turbomolecular Pumps Oil Diffusion Pumps Cryo Pumps Turboradial Blowers Valves und Fittings Total Pressure Gauges Customized Experimentation Systems Customized Vacuum Solutions Standard Vacuum Pump Systems Worldwide Service Network After Sales Service Installation and Training Maintenance and Repair,on-site or in our Service Centers Replacement and Back-up Pool Service Across All Brands Decontamination Calibration of Measurement Systems in our DKD Certified Laboratory Page 11 Oerlikon Capital Market Days 2008

12 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 12 Oerlikon Capital Market Days 2008

13 Total vacuum pump market 2007 by application Total Market = CHF 4.6bn CAGR : 4-5% Pick & Place Print & Paper Wood Non-Focus Market Process Industry Focus Markets Industry Profit Pool Accessible with Oerlikon Vacuum s Four Core Technologies Differentiation via Application Know-how Semi Non-Focus Markets: Solar Analytics R&D Coating Low-Margin Markets Non Oerlikon Vacuum Technologies (Side Channel Blower, Liquid Ring Pump) Differentiation via Price Page 13 Oerlikon Capital Market Days 2008

14 High growth potential in Asia and Americas Addressed Market = CHF 3.6bn CAGR : ~ 4-5% Oerlikon Vacuum Sales = ~ CHF 500m Grow double market Europe 27% Asia 24% Asia 50% Americas 23% Americas 17% Europe 59% Page 14 Oerlikon Capital Market Days 2008

15 Solar, PI, and analytical most attractive markets basic growth drivers very healthy Solar / Coating Process Industry Analytical Instruments / R&D Market 2007 CHF ~ 530m CHF ~ 1,400m CHF ~ 930m CAGR (08-11) ~ + 13% ~ + 3-4% ~ + 5-6% Key Attractions Strong Growth in Renewable Energies, Solar biggest Opportunity Key Players inside Oerlikon Group (Solar and Wear Protection) Few Customers with Global Footprint Largest Market, Solid Growth Lower Price Pressure due to Broad Customer Base Premium Price Level in Chemical Technology Driven with High Entry Barriers in Analytical Stable Growth Rate Few Players in Analytical Broad Customer Base in R&D Overall Medium Price Sensitivity Key Industry Drivers High Oil & Gas Prices Global Warming Need to Save Energy due to Limited Fossil Energy Resources Global Government Incentives Growth of Producing Industries in Asia, Eastern Europe Analytical Driven by Rising Demand for Health Care, Life Style Products and Environmental Control R&D Market Based on Government Funding Source: Frost & Sullivan; VDMA; Gartner; Oerlikon; Bain Analysis Page 15 Oerlikon Capital Market Days 2008

16 Main industry trends coincide with Oerlikon vacuum strengths Industry Entry Barriers intact due to Advanced Technology, Global Distribution & Service Network and High Qualification Cost in OEM Business No Disruptive Replacement Technology for Vacuum Equipment in Sight Importance of Cost of Ownership will Increase in Line with our Product Roadmap > More Request for Dry Technology > Trend to Small / Mid-Size MAG Technology in Coating Applications Increased Demand for Complete Vacuum Solutions fits to our Core Competence Price Pressure to be addressed by Expansion of China Factory which is also a Hub for Low Cost Country Sourcing Overcapacities in Semi Down cycles give Opportunities to Drive Industry Consolidation Page 16 Oerlikon Capital Market Days 2008

17 Oerlikon vacuum on track to become #2 in growth markets Market Share by Addressed Market Segments 2007 PI COA Solar ANA R&D SEMI Busch OLV Pfeiffer Vacuum Varian Edwards Others Pfeiffer Edwards OLV Adixen Busch Shimadzu Others OLV Busch Ulvac Others Edwards Pfeiffer OLV Varian Others Pfeiffer Varian OLV Adixen Edwards Others Edwards Ebara Brooks / CTI / GP Adixen Shimadzu Busch Others OLV OLV: Oerlikon Leybold Vacuum Source: Oerlikon, Company and analyst reports, Bain analysis Page 17 Oerlikon Capital Market Days 2008

18 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 18 Oerlikon Capital Market Days 2008

19 Focused organic growth drives scale and profitability Based on Innovative Products & Cost Competitiveness Focusing on Product Innovations and Core Market Segments Simplification Drives Cost Reduction Product Innovations Become No. 1 in Solar Gain Market Share in PI, R&D and ANA Positioning as Total Solutions Provider Screening for Industry Consolidation EBIT Growth by Almost 100% Platform Based Cost Reduced Product Portfolio Supply Chain Management (Supplier & Logistics) Extend China Production Site Streamlined Overhead Structure CAGR = 2 x Market Growth Substantial Cost Reductions Page 19 Oerlikon Capital Market Days 2008

20 Innovation at the edge of physics: the vacuum systems of the CMS detector at CERN Challenges for the Pumping System: Operation in a magnetic field of 4T (50,000 times stronger than natural field of earth) extremely complicated installation behind a 7m thick wall of concrete for radiation protection. Based on our experience with the Large Hadron Collider and the ATLAS detector, Oerlikon Leybold Vacuum mastered this challenge and obtained the CMS Gold Award 2008 for the successful design and installation of the requested vacuum system Page 20 Oerlikon Capital Market Days 2008

21 Product innovations Enhancement of four Core Technologies in order to meet Future Market Needs Dry Fore Vacuum Pumps Turbomolecular Pumps - Customizing requirements for vacuum processes - Optimizing capacities Rotary Vane Pumps - TRIVAC NT - Generic platforms for sizes 30-40% Complexity and up to 50% Cost Reduction with new Product Platforms - Mechanical Turbopumps - MAG Pump series - Generic platforms for sizes System Solutions - Customer Benefit through design and application Know-How - SOLAR Systems Page 21 Oerlikon Capital Market Days 2008

22 Vacuum - key technology for solar Crystalline Silicon Vacuum required Production of Silicon Ingots & Wafers Production Coating of Wafers Thin Film Technology Production of Modules incl. Lamination Installation of Modules Cleaning of Glass Generation of TCO & Photo Electric Layers Page 22 Oerlikon Capital Market Days 2008

23 Vacuum systems for sustainability All solar modules require vacuum processing at multiple stages of production Oerlikon Leybold Vacuum has specially engineered products that are helping to make solar modules more affordable by reducing equipment downtime and improving process performance Our industry experience and vacuum innovations have enabled us to make design decisions, large and small, that directly address the needs of the solar power market Enabling Customers in Seeking Grid Parity Vacuum Solutions Meeting Demands Fast and Efficiently Page 23 Oerlikon Capital Market Days 2008

24 Strengthening customer proximity / customer interfaces Further Market Penetration in Process Industry, R&D and Solar - Additional direct sales force esp. in Asia (+50%) and USA (+30%) - Expansion of distributor network and E-Shop implementation Increasing Customer Proximity and Loyalty by enhanced Sales Support - Increase local engineering and application Know-how - Roll-Out of worldwide customer training program (Vacuum Academy) Grow Double than Market Gain Share in PI and R&D, Market Leader in Solar Services - Increase of services & repair facilities and local customer approach - Increase of market share in spare parts business with new pricing strategy Solutions - Build up hubs in the regions - Establish global processes and workflows to secure cost and quality - Roll out engineering know-how and synergies to strengthen the customer interface Page 24 Oerlikon Capital Market Days 2008

25 Realizing sales growth with lower breakeven and costs Optimized Worldwide Logistics Concept - Establishment of a worldwide Logistic Concept focussing on: > Freight Cost Reduction > Delivery Performance > Complexity Reduction Sourcing - Enhancement of LCC Sourcing from 7% to 20% - Reduction of Supplier Base by 30% Realizing Sales Growth with a Simplified Supply Chain Locations - Factory Expansion China in order to Double Volume by Reduction of Manufacturing Depth by 10 % Key Investments - Solar Growth - Facility Expansion China Page 25 Oerlikon Capital Market Days 2008

26 Buildings extension in Tianjin (CN) for local production 2,400 square meters 10,200 square meters under roof Page 26 Oerlikon Capital Market Days 2008

27 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 27 Oerlikon Capital Market Days 2008

28 Strategic target - accelerate organic growth (in CHF m) +6% ,8% ,8% 10.3% 250 1,5% 6-1,3% HY 2008 Total Sales EBIT EBIT Margin [%] Page 28 Oerlikon Capital Market Days 2008

29 Operational target improve working capital (WC) DIO WC Management Initiatives started mid 2007 Project Inventories ww (lifetime project) act DPO Achievements YTD 2008 DIO -11% DPO + 27% DSO +2 % vs. Sales +7% act DSO act Page 29 Oerlikon Capital Market Days 2008

30 Agenda Segment Description Technology Market Description Strategy Financials Summary & Outlook Page 30 Oerlikon Capital Market Days 2008

31 Executive summary key take aways Oerlikon Vacuum Sustainable Strategic Position Strengthened with New Products in Dynamic Markets Top Line Growth at Twice the Market Mainly Driven by Solar and Enforced Market Penetration in Fragmented Markets like Process Industry and R&D Complexity Reduction by New Product Platforms Expansion of China Factory (100% Increase Output profitability Increase to by 16% 2011) EBIT Sustainable Level of Double Digit Profitability Page 31 Oerlikon Capital Market Days 2008