Connecting the Physical & Digital Worlds and Enabling Direct Brand-to-Consumer Mobile Engagement. Corporate Presentation September 2017

Transcription

1 Connecting the Physical & Digital Worlds and Enabling Direct Brand-to-Consumer Mobile Engagement Corporate Presentation September 2017

2 Safe Harbor Statement This report includes forward-looking statements covered by the Private Securities Litigation Reform Act of Because such statements deal with future events, they are subject to various risks and uncertainties and actual results for fiscal year 2017 and beyond could differ materially from the Company's current expectations. Forward-looking statements, including estimates of capacity, selling price and other material considerations, are identified by words such as "anticipates," "projects," "expects," "plans," "intends," "believes," "estimates," "targets," and other similar expressions that indicate trends and future events. Factors that could cause the Company's results to differ materially from those expressed in forward-looking statements include, without limitation, variation in demand and acceptance of the Company's products and services, the frequency, magnitude and timing of raw-material-price changes, general business and economic conditions beyond the Company's control, timing of the completion and integration of acquisitions, the consequences of competitive factors in the marketplace including the ability to attract and retain customers, results of continuous improvement and other cost-containment strategies, and the Company's success in attracting and retaining key personnel. The Company undertakes no obligation to revise or update forward-looking statements as a result of new information, since these statements may no longer be accurate or timely. Thinfilm financial reports may be accessed via the following web page: 2

3 Thinfilm creates digital identities and actionable micro-connections to physical objects Thin Film Electronics ASA Thinfilm s solutions turn smartphones into intelligent agents Publicly listed OSE (THIN) OTCQX (TFECY) Revolutionary Silicon Valley fab for roll-based manufacturing of printed electronic devices Former Qualcomm facility 2,000 sq. m. state-of-the-art cleanroom 310 total patents 18 new patents issued in the first half of new patent families in the first half of employees worldwide Sales offices in San Francisco, London, Singapore, Shanghai 3

4 With Thinfilm, End-to-End NFC Cloud Solutions NFC touchpoints for physical goods Cloud-based triggers for dynamic user experience Back-end analytics to assess & integrate 4

5 Proof Points of NFC in Q2 Deployments Largest global deployment of NFC in wine & spirits industry (126,000 bottles) Consumer tapping activity in 50 US cities X increase in website conversions; 92% lift in mobile traffic Thinfilm NFC used with 20,000 emergency relief deliveries Total of 20 deployments and field-trials in-market or planned/signed in Q Plus: Shelf-talkers > OTC Pharma In-store Displays > Consumer Durables Metalized packaging (Tobacco) Specialty Foods Planned trials in Nutritionals and Cosmetics 5

6 Exponential Increase in Tapping Activity Coronado Brewing Co. In California Barbadillo In Spain Korean Red Cross In South Korea Oskar Blues Brewery In the USA Q2 deployments encompass uses in North America, Europe and Asia ranging from local to national distribution 6

7 NFC Increases Consumer Engagement Call-to-action for the Surfrider / Earth Day campaign 7

8 Largest NFC Deployment in the Wine and Spirits industry with Thinfilm s Speedtap labels Largest Wine & Spirits Campaign Castillo de San Diego White Wine distributed through 200+ major retail outlets nationally in Spain 126k Smart Bottles Instant Prize Campaign Objectives Improve Consumer Engagement Growth in New Brand Fans Increase Sell Through Consumers Tap to Win Prize Innovative Lottery style Campaign promoted through traditional Point of Sale + Print, TV, Radio media Channels 2017 Campaign judged by Barbadillo to be twice as effective as prior years because of SpeedTap NFC deployment NFC Tag Touchpoint Applied on reverse face of Neck Collar directly beneath Call-to-Action x >30% Thinfilm SpeedTap NFC enabled bottles tapped More MQLs* than any other channel Of bottles tapped were purchased and re-tapped at new location, generating location data in CNECT 8 *Marketing Qualified Lead

9 NFC drove brand engagement better than Facebook and Google Created higher quality traffic than display / banner ads Brand Engagement for Barbadilllo Dando-en-el-Blanco summer campaign on 126,000 Castillo de San Diego bottles 79% of all traffic from mobile % of mobile traffic is paid 54% of brand engagement came from NFC and Thinfilm SpeedTap enabled bottles 5% 16% 79% Mobile Desktop Tablet Mobile dominates Paid 75% Direct 25% Mobile is not free Search / Google 30% Social / Facebook 11% 61% Banner / 14% Display Ad 26% 54% Inner circle: Share of paid traffic Outer circle: Engagement per source Thinfilm - 10x more traffic than Social / Facebook - 4x more engagement than banner / display ads - Even better than Google NFC was the dominant channel for brand engagement 9

10 Supply Chain & Industrial Use Case Expansion New industrial customers signed in Q2 enabled by new ecosystem partners Single tap to authenticate delivery of goods and services to consumer recipients Enable insurance companies to directly on-board customers while maintaining brokerbased sales model Ideal for toxic, perishable and high-value pharma assets that must be checked in/out by qualified personnel Secure Delivery Verification Customer On-boarding for Insurance Industry Supply Chain Tracking 10

11 Supply Chain & Industrial Use Case Expansion New industrial customers signed in Q2 enabled by new ecosystem partners Machinery and equipment that requires regular inspection, maintenance, and replacement Alerts and guides technicians on troubleshooting and maintenance of industrial assets Inspection/Logging /Reorder Preventive Maintenance 11

12 CNECT Software Platform - Thinfilm Software team expanded to 16 FTEs, half in-house and half near-shore - 10 months after Sept kick-off, completed a total of 19 sprints, four major product releases, and supported specific customer applications for tag pairing, ios scanning and AR (augmented reality) 12

13 Apple Announcement Dramatically Expands NFC Opportunity for Consumers Apple update June 2017 Apple announced support for NFC tag WWDC System requirements: iphone 7 & higher ios 11 (available now in beta) Must be in Scan mode Apple requires use of approved apps and more user interaction Thinfilm CNECT opportunity CNECT registered companies increased from 68 at end Q1 to 260 by end July 2017 Beta version of Thinfilm NFC Tag Scanner app for ios devices developed and tested Solution supports conventional tags read by ios devices 13

14 Enabling Billions of Devices by Roll-Based Printing Successful grand opening event EAS requalified / NFC requalification on schedule First product shipped from new fab Roll-based capital expansion investment on budget Ordering of NFC line near complete, including testing/inspection Laser ROM unit for writing memory pending Not gating start date First equipment arrives August 2017 Roll-based production of EAS on schedule for end 2017 First production of NFC expected early Q3 2018, on schedule Thinfilm s BoD approved acceleration of capital program to fully complete line by mid 2018 Full line output by 2019 in the billions of units per year Mayor of San Jose and two Council Members showing first sheet shipped from new Junction Avenue facility on Opening Day, June The grand opening included keynote presentations from Gartner (Charles Golvin), and Google X (Raj Apte; Thinfilm Technical Advisory Committee, shown above) Broad coverage in Bay Area media and front page cover story in San Jose Mercury News 14

15 Thinfilm Q Financials 2,500 2,250 2,000 1,750 1,500 1,250 1, Revenue & Other Income* [kusd, LHS] LTM Revenue & Other Income* [kusd, RHS] 860 1,280 1, ,077 1,039 1,599 1, ,115 1,019 2,300 5,500 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Record quarter revenues as a result of: Total Revenue of USD 1.7 million 8.5M EAS tags shipped Milestone payments from Fortune 500 pharma JDA Doubling of NFC product deliveries Other income of USD 0.6 million, including USD 450k accounting gain because of disposal of fixed assets OPEX rose in the period as a result of: Increased manning by 10 FTEs related to field sales and engineering/manufacturing Higher manufacturing activity level and product deliveries Capital plan on budget; acceleration approved by Board based on market traction USD 9.5 million used in H1 on fixed and intangible assets, primarily related to the new roll-to-roll production line and facility upgrades USD 11.3 million pre-payments paid for equipment that has been ordered but not yet delivered related to the rollbased manufacturing capital plan 15 * excludes other income related to January 2014 recognition of badwill Cash balance of USD 28.2 million per end June 2017

16 Thank You Davor Sutija CEO