technology Bond investor presentation May 7 & 8, 2018 1 - PowerPoint PPT Presentation

PASSION. PRECISION. PURITY. Bond investor presentation PASSION. PRECISION. PURITY. No. 1 global market position in high-end vacuum valve technology Bond investor presentation May 7 & 8, 2018 1

PASSION. PRECISION. PURITY. Today’s presenters Bond investor presentation Michael Allison, Chief Executive Officer  CEO of VAT since 2018, previously served in various leadership roles at Edwards/Atlas Copco, most recently as President of the Semiconductor Division, as well as at KLA-Tencor Corp.  More than 30 years of industry experience ranging from process engineering to business development, service & marketing, turnarounds and M&A Andreas Leutenegger, Chief Financial Officer  CFO of VAT since 2015, previously served as Head of Group Controlling at Holcim and CFO at Siam City Cement Public Company Limited  Significant global experience in finance and treasury, controlling and accounting, capital investment and strategy and business development 2

PASSION. PRECISION. PURITY. Agenda Bond investor presentation 1 VAT overview 2 Key credit highlights 3 Financial performance 4 Bond offering 3

PASSION. PRECISION. PURITY. VAT – enabling innovation in your daily life and facilitating the digitalization of the world Without VAT we wouldn’t have any of these… Bond investor presentation  We are the global leader in high-end vacuum valves with a strong brand reflecting our reputation for technology, know-how and innovation  High vacuum processes are key enablers of the technological evolution Flatscreens and Smartphones Electric cars displays  VAT valves are mission-critical components in the high vacuum process technology  We drive innovation with R&D spending that is unmatched in our industry  We transform our success into best-in-class financial performance Solar panels Healthcare Microchips 4

PASSION. PRECISION. PURITY. VAT at a glance (FY 2017) – The global leader in high-end vacuum valve technology Bond investor presentation Valves VAT Group AG Global Service Industry (14%) (6%) (80%) Segment (% of total net sales) 16% EMEA 51% Asia 33% North America CHF 692m / +36% CHF 554m / +40% CHF 99 / +21% CHF 40m / +26% Net sales Adj. EBITDA 1 CHF 215m / 31.1% CHF 189m / 31.7% CHF 48m / 48.2% CHF 13m / 21.5% / margin 2 1 Adjustment on Group level only 2 Segment margin based on segment net sales 5

PASSION. PRECISION. PURITY. VAT offers valves, modules and services for three key markets Bond investor presentation Semiconductors Display & Solar Bellows General Vacuum Modules Services 6

PASSION. PRECISION. PURITY. PASSION. PRECISION. PURITY. VAT has an unparalleled portfolio of high-end vacuum valves Bond investor presentation  VAT’s product portfolio Isolation valves encompasses more than 150 valve series All-metal Large gate with more than 8,000 Angle valves Gate valves Pendulum valves valves valves customized and 2,500 standard products Transfer  Lifetime of up to 5 valves million cycles  Allow for lowest ATM Doors MONOVAT L-Motion XL-VAT TwinVAT particle contamination Control valves Controlled Controlled Symmetrical Butterfly valves Combo valves pendulum angle valves flow systems valves 7 7

PASSION. PRECISION. PURITY. Vacuum valves are mission-critical components in high-tech production processes  VAT high-end vacuum valves, standing for close to zero Bond investor presentation particles, highest purity and reliability, control and regulate flows and pressures in advanced production processes  Closest component to the process  Leak tightness over specified lifetime  Zero particle generation in order to enable zero defect production of micro-electronics  Highest cleanliness level in order to prevent any organic and / or inorganic impurities coming into the process environment  Reliable and reproducible open / close sequence over total lifetime of valve to match control sequences of complete process tool  Shortest open / close times in order to maximize throughput of total system 8

PASSION. PRECISION. PURITY. VAT is attractively positioned in the value chain of the vacuum / process industry Vacuum system Equipment Bond investor presentation Material suppliers component manufacturers Device manufacturers manufacturers (OEMs) Valves 9

PASSION. PRECISION. PURITY. Agenda Bond investor presentation 1 VAT overview 2 Key credit highlights 3 Financial performance 4 Bond offering 10

PASSION. PRECISION. PURITY. VAT – Key credit highlights Bond investor presentation 1 Pure play business model as the technology leader in mission-critical vacuum valves 2 Long-term strategic partner for a diversified blue-chip customer base 3 Digitalization of the world drives growth and stability for VAT 4 Undisputed no. 1 market position protected by high entry barriers 5 Attractive financial profile with strong resilience supported by flexible cost structure 11

PASSION. PRECISION. PURITY. Pure play business model as the technology 1 leader in mission-critical vacuum valves Bond investor presentation Pure play on mission-critical vacuum valves Technology leadership  Low operational complexity and high  Over a three year cycle 2/3 rd of the flexibility revenues are generated with products developed or revised within this period  Broadest product portfolio of valves for a  10% of VAT staff engaged in the R&D huge range of applications process  Mission-critical nature of high-end vacuum valves makes innovation, quality, reliability c.540 96% 96% 72% 72% and performance the key drivers of 58% 58% 48% customers’ buying decision, well ahead of c.72 6% c.60 c.60 c.48 c.48 c.36 c.36 price VAT 2017A R&D expenses in % of Vacuum valve sales (USD million) own/competitors ’ vacuum valve sales Source: VLSI Research March 2018, 2017 full year preliminary data 12

PASSION. PRECISION. PURITY. Leveraging our core competencies to exceed 1 industry requirements Relevance to Bond investor presentation VAT core competencies industry segments Semi Display Solar R&D Technology enablers     Sealing technology     Contamination management (zero defects)     Material & coating competence     High speed control technology     Module solutions     Precision motion components     Vacuum design (total cost of ownership)     IP management     Manufacturing, assembling and machining expertise 13

PASSION. PRECISION. PURITY. 2 Long-term strategic partner for a diversified blue-chip customer base Bond investor presentation Semiconductors Display & Solar Ever increasing technological requirements resulted in consolidation and symbiotic partnerships Lintott Engineering Plating Implant PV SEZ AG Equipment manufacturers division Opal / Orbot Metrology Mask making Emcor (OEMs) General Vacuum Modules + Consolidation of OEMs driven by end-user consolidation 90nm 65/55nm 45/40nm 32/28nm 22/20nm 14nm Device manufacturers 14

PASSION. PRECISION. PURITY. 3 Digitalization of the world drives growth and stability for VAT Bond investor presentation … fosters future growth while reducing the cyclicality of the Ubiquitous presence of electronic devices … industry 1'600 1'400 Cellular Handsets 1'200 Other 1 16% IC unit shipments (billion) IC Sales (USD billion) 21% 1'000 800 600 400 Tablets 3% 200 PCs WW Electronics 14% Peripherals Production 2017 0 4% 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2’066B$ Wired IT 60% 4% 40% Wireless IT Industrial 5% 11% 20% Storage 0% 5% Audio/Vide Servers & Automotive o -20% Mainframes 6% 5% 6% % change of IC unit shipments % change of IC sales (USD) -40% Source: VLSI Research March 2018 Source: VLSI Research April 2018 1 Includes Other IT, Other Personal Devices, Other Electronics 15