INVESTOR PRESENTATION

Transcription

1 INVESTOR PRESENTATION Asher Levy, CEO January 2016 THE LANGUAGE OF ELECTRONICS

2 Disclaimer Private Securities Litigation Reform Act of 1995 Safe Harbor and Industry Information Except for historical information, the matters discussed in this presentation are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of These statements relate to, among other things, future prospects, developments and business strategies and involve certain risks and uncertainties. The words anticipate, believe, could, will, plan, expect and would and similar terms and phrases, including references to assumptions, have been used in this press release to identify forward-looking statements. These forward-looking statements are made based on management s expectations and beliefs concerning future events affecting Orbotech and are subject to uncertainties and factors relating to Orbotech s operations and business environment, all of which are difficult to predict and many of which are beyond the Company s control. Many factors could cause the actual results to differ materially from those projected including, without limitation, timing and extent of achieving the anticipated benefits of the acquisition of SPTS, the timing and impact of conversion of SPTS s financial statements from U.K. GAAP to U.S. GAAP and the Company s ability to convert SPTS to a U.S. GAAP reporting regime, including its internal control over financial reporting; Orbotech s ability to effectively integrate and operate SPTS s business, the timing, terms and success of any strategic or other transaction, cyclicality in the industries in which the Company operates, the Company s production capacity, timing and occurrence of product acceptance (the Company defines bookings and backlog as purchase arrangements with customers that are based on mutually agreed terms, which, in some cases for bookings and backlog, may still be subject to completion of written documentation and may be changed or cancelled by the customer, often without penalty), fluctuations in product mix, worldwide economic conditions generally, especially in the industries in which the Company operates, the timing and strength of product and service offerings by the Company and each of its competitors, changes in business or pricing strategies, changes in the prevailing political and regulatory framework in which the relevant parties operate or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis, the level of consumer demand for sophisticated devices such as smartphones, tablets and other electronic devices, the timing for a verdict in the ongoing appeal of the criminal matter and ongoing investigation in Korea, the final outcome and impact of this matter, including its impact on existing or future business opportunities in Korea and elsewhere, any civil actions related to the Korean matter brought by third parties, including the Company s customers, which may result in monetary judgments or settlements, expenses associated with the Korean matter, ongoing or increased hostilities in Israel and other risks detailed in the Company s SEC reports, including the Company s Annual Report on Form 20-F for the year ended December 31, 2014, and subsequent SEC filings. The Company assumes no obligation to update the information in this press release to reflect new information, future events or otherwise, except as required by law. 2 Investor Presentation

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4 Mission Make smart, digital production a reality through continuous technology innovation for a better tomorrow Vision Be the global leader in advanced micro manufacturing solutions for electronics and adjacent markets that ensure greater production efficiencies for sustainable profitability 4 Investor Presentation

5 Orbotech Key Facts Markets: Products: Company: Printed Circuit Boards Flat Panel Display MEMS, RF, Power Advanced Packaging ~ 2,200 Employees 50 Offices 3 Divisions Multiple Industries Solar THE LANGUAGE OF ELECTRONICS 5 Investor Presentation

6 At a Glance We enable the transformation of the electronics industry with innovative manufacturing processes & solutions 6 Investor Presentation

7 Our Markets Key Markets: I Printed Circuit Boards (PCB) $400M I Flat Panel Displays (FPD) $300M I MEMS*, RF, Power $390M I Advanced Packaging $200M vs. total electronics market expected CAGR of ~4% Source: Company estimates, partially based on Yolé, Prismark Partners, HIS *Micro-Electro-Mechanical Systems 7 Investor Presentation

8 Key Growth Drivers Increasing uptake of smart mobile devices Internet of Things becomes a reality Mobile TVs Networked Devices Automotive Ever more sensors in smart cars 8 Investor Presentation

9 Expressing designers dreams through the Language of Electronics 9 Investor Presentation 9 Investor Presentation

10 Core Assets Leading technology and innovation Large installed base with close relationships Repeatedly first to market Global infrastructure 10 Investor Presentation

11 Our Positions Over 80% Serving New purchases from the Top 50 Printed Circuit Boards makers in the past 3 years every major display panel manufacturer Serving the world s Top 5 OSATs Serving 28 of the top 30 MEMS manufacturers Leadership Positions in all the markets we serve 11 Investor Presentation

12 Strategic Focus I Organic growth I Adjacent markets Innovation Drivers Designer Vision Primarily advanced packaging I Moving up the value chain I Becoming a process innovator I Growing in Additive Manufacturing Consumer Demand Manufacturing Capabilities 12 Investor Presentation

13 Long Term Operating Model < $900 Million 48% - 50% ~30% Service revenues 12% - 14% 21% - 23% 17% - 19% Revenues Gross Margin Net R&D Adjusted EBITDA Margin Non-GAAP Net Income Margin 13 Investor Presentation

14 Expecting Progress On All Fronts Expecting continued growth New products innovation I I I Printed Circuit Boards forecast to recover Flat Panel Displays wave of investments Semiconductor Devices to benefit from Fan Out Wafer Level Packaging growth ~30% Service revenues Profitability supported by operating leverage and business mix Balancing debt pay-down and additional acquisitions 14 Investor Presentation

15 Summary Growth Leadership Diversified driven by increasing complexity and functionality of electronics through technology and innovation product portfolio, customer base, end markets and geographic exposure We enable the transformation of the electronics industry with innovative manufacturing processes & solutions 15 Investor Presentation

16 Appendices

17 Product Portfolio - Printed Circuit Boards Automated Optical Inspection (AOI) Inspection and identification of defects in the artwork design master, production phototools and PCBs at various stages of production Automated Optical Repair (AOR) Automatic repair of defects known as shorts and excess copper Laser Direct Imaging (LDI) Transfer of digital image data directly from electronic media on to the photoresist Inkjet (IJ) PCB legend printing and die marking and other advanced production applications UV Drilling (UV) Generation of the interconnection between different layers in interconnect substrates advanced packaging applications 17 Investor Presentation

18 Outlook - Printed Circuit Boards I Historically outperformed the market growth I Main growth drivers: Smart Mobile Devices Automotive 4G in China Wearable Electronics 18 Investor Presentation

19 Product Portfolio - Flat Panel Displays Array Checker Detection, location, quantification and characterization of electrical, contamination and other defects Automated Optical Inspection (AOI) Automatic detection of flaws and defects Array Saver Repair of short defects during and after array fabrication 19 Investor Presentation

20 Outlook - Flat Panel Displays Main growth drivers: China TVs (large panel displays) New display technologies - drives more inspection, testing and repair demands 20 Investor Presentation

21 Product Portfolio - Semiconductor Devices Physical Vapor Deposition (PVD) Deposition of thin layers of metals that are used as interconnects, barrier layers or functional layers Chemical Vapor Deposition (CVD) Low temperature deposition of insulators for the MEMS and packaging markets Plasma Etch Removal of material to form a pattern or a shape in a substrate or layer, using plasma containing reactive gases Vapor Release Etch Removal of material to release flexures or other MEMS devices) from a substrate, using gasses 21 Investor Presentation

22 Outlook - Semiconductor Devices Increasing consumer product functionality in various industries drives demand for MEMS, RF and Power devices Staying on Moore s Law and More than Moore curves drive demand for Advanced Packaging Strong long-term growth drivers in: Reducing energy consumption Renewable power Automotive Industrial automation Wireless communication Smart mobile devices 22 Investor Presentation

23 Operating Leverage Gross Profit ($M) and Margin (%) Adjusted EBITDA ($M) and Margin (%) %44.4% 43.6% 43.0% 44.2% 43.0% 45.0% 45.4%45.3% % 40% % 18.3% 16.7% 19.4%19.5% 15.1% 15.2% % 12.4% % 18% % 20% % -2% 20 10% 10-12% 5 0 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 0% 0 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q % Leveraging core technologies and global infrastructure 23 Investor Presentation

24 Thank You