ams Q2 and H1 2014 results Kirk Laney, CEO Michael Wachsler-Markowitsch, CFO Moritz Gmeiner, Head of IR July/August 2014 Confidential © ams AG 2014 What we do for our customers ams provides innovative analog solutions to the most challenging applications in sensors, sensor interfaces, power management, and wireless. Confidential © ams AG 2014 Page 2 ams overview At a glance • Focus on high performance analog semiconductors • Sensor solutions, sensor interfaces, power management, wireless • Ultra-low power, highest accuracy, sensitivity and integration • Analog IDM: world class design + in-house manufacturing • Best-in-class solutions for leading OEMs worldwide By the numbers • 350+ analog engineers • Over 30 years of design experience • Revenues Q2 2014 EUR 106m/$146m (Q2 2013: EUR 85m/$112m) FY2013 EUR 378m/$502m (2012: EUR 388m/$498m) • More than 1,500 employees worldwide • Over 7,800 customers Confidential © ams AG 2014 Page 3 Our focus High performance sensors and analog ICs Target markets Core expertise Consumer and Communications Industrial, Medical, Automotive 59% of revenues (H1 2014) 41% of revenues (H1 2014) Sensor solutions, sensor interfaces Power management Wireless Confidential © ams AG 2014 Page 4 OUR MARKETS CONSUMER AND COMMUNICATIONS INDUSTRIAL, MEDICAL, AUTOMOTIVE Consumer and Communications Sensor solutions and sensor interfaces, power management, wireless Sensors Power management Wireless Specialty solutions • Light sensors, gesture sensors • MEMS microphone ICs • Hall/inductive/ capacitive sensors • Power management ICs • Lighting management ICs • NFC antenna booster, front ends • RFID readers (UHF/HF/NFC) • LF/HF/UHF transceivers/smart tags • Active noise cancellation (ANC) • Wireless sensors (lightning sensor) • Specialty sensor interfaces Confidential © ams AG 2014 Page 6 Light sensors Worldwide leader in intelligent integrated light sensors Sensor solutions • RGB color - for full analysis of light spectrum and temperature; enhance display picture quality • Ambient light (ALS) - measure monochromatic ambient light to control display brightness • Proximity (Prox) - detect proximity of user’s ear to control display/touchscreen on-state • Gesture - sense hand movement in proximity of device surface to create touchless interface Gesture 4-in-1 module at very high run rates Consumer electronics • Smartphones, tablet PCs, other mobile devices • HDTV, PCs, notebooks Sensor-driven lighting • Major light sensor applications for the future • Smart, dynamically managed home, industrial, and outdoor lighting • First solutions under development Confidential © ams AG 2014 Page 7 Success: Gesture recognition sensor Simplifying the human-machine interface (HMI) with high performance touchless technology Highly integrated gesture sensor innovation • ams’ leading photodiode technology adapted In successful to provided highly reliable, precise touchless Asian OEM user interface for consumer, communications, smartphone medical, automotive, and industrial markets platforms • Sophisticated gesture engine accommodates complex IR-based gesture sensing • TMG3993 IR gesture, color ambient light sensing (ALS) and proximity detection 4-in-1 module with mobile coupon redemption • Industry standard module package size with <10mm2 footprint Benefits • Highly integrated solution for maximum system value • Configurable gesture commands provide application flexibility • Reduces system BOM cost and board space requirements • MobeamTM bar code functionality simplifies mobile commerce • Enables next generation user interface applications Confidential © ams AG 2014 Page 8 Wireless solutions Mobile transactions: NFC solutions • Solutions for smartphone embedded NFC and complete NFC on SIM/microSD card • Antenna booster technology analog front-ends with auto antenna tuning • World-leading expertise in NFC technology • OEM relationships build market acceptance Mass production of NFC booster at high run rates Authentication: RFID solutions • Integrated one-chip UHF reader solutions offer low solution cost for cost-effective RFID deployment • Other RFID: HF readers, smart tags, LF/HF/UHF transceivers • Applications: consumables, goods tracking and authentication, retail shrinkage prevention Confidential © ams AG 2014 Page 9 Success: NFC antenna booster Reliable near field communication (NFC) to assure worry-free mobile transactions Wireless innovation • Advanced active tag analog front end (AFE) • Active antenna boost overcomes reception problems in smartphones or for small form factor antennas • Designed for ultra small form factor applications Major global device launches driving H2 growth Benefits • World’s first High Frequency (HF) active booster amplifies the antenna by >80x for NFC in small areas • Overcomes field-dampening metal environments to ensure 100% read rate • Extends range up to 10cm (free air) for NFC on SIM cards • Accelerating NFC smartphone adoption via large scale OEM engagement Confidential © ams AG 2014 Page 10 MEMS microphone ICs MEMS microphone interfaces for smartphones, handsets, tablet PCs, notebooks, and other mobile devices • • • • • Over 1.6 billion MEMS microphone ICs shipped in 2013 Market leader with over 60% market share Extensive product portfolio based on more than 10 years of expertise Dynamic market driven by device adoption/penetration, audio quality and cost optimizations Leader in low noise focusing on higher value market segments High volume shipments of MEMS mic ICs Confidential © ams AG 2014 Page 11 Power management solutions for mobile devices PMIC solutions enable optimum battery life and system performance Power management innovation • High performance PMIC design delivers PMIC ramp-up for superior value for clamshell and other first clamshell mobile devices utilizing multicore processor devices ongoing designs • Supports leading mobile graphics processor’s current and upcoming platforms • Patent pending unique technology to manage high speed, high current power stages Benefits • Enables highest frame rates at maximum screen resolutions for mobile devices while maximizing battery life • Industry’s first programmable and scalable converter solution supporting up to 20 amps load in 10 microseconds • Industry’s smallest total size multiphase DC/DC design, resulting in a PCB area savings of 50% Confidential © ams AG 2014 Page 12 Industrial Sensor solutions and sensor interfaces Industrial automation and control • Motion control • Industrial sensors • Drives and electrical motors 2D and 3D position encoders • Magnetic rotary and linear encoders • Integrated high performance Hall sensors • Broad portfolio for widest range of applications Building automation and security • HVAC • Safety • Bus systems Seismic sensor interfaces • Highest sensitivity sensor solutions Confidential © ams AG 2014 Page 13 Medical Sensor solutions and sensor interfaces, power management, wireless Medical imaging: Leader in lowest noise sensor solutions • Computed tomography – supplier to #1 • Digital X-ray – supplier to #1 • Mammography – supplier to #1 • Ultrasound – supplier to market leaders Personal health devices • Diabetes management • Heart rate monitors Robotic surgical solutions • Encoder-driven accuracy Confidential © ams AG 2014 Page 14 Automotive Sensor and sensor interfaces, bus systems, power management, wireless Position sensing • Pedal & throttle position • Transmission (clutch, gear shift) • Steering wheel angle and torque • Brushless motor control applications Battery power management • Battery management for conventional, hybrid, and electric vehicles • Highly-efficient power management Safety systems • Collision avoidance LIDAR systems (object detection) • ESP (Electronic Stability Program) • FlexRay® high bandwidth data network Confidential © ams AG 2014 Page 15 Success: Laser-based LIDAR collision avoidance Enables automatic braking for accident avoidance and pedestrian protection Automotive innovation • Obstacle distance detection by laser pulse time-of-flight measurement • Laser beam scans area in front of vehicle, beam reflection is measured with highest speed and accuracy • Chip set comprising three channel high bandwidth amplifier and high speed pipelined ADC • In volume production, additional car platforms launching 2014, second generation nearing release Benefits • Very cost-effective active safety feature • Allows for fully automatic braking in dense city traffic • Simple assembly close to rear view mirror • Seamless integration with vehicle stability system via standard CAN bus Confidential © ams AG 2014 Page 16 Scalable and profitable manufacturing model In-house capacity + manufacturing partnerships: proven excellence for profitable growth Wafer manufacturing • 200mm in-house fab (2014E 155k wafers p.a.) • CMOS nodes: 0.18µm – 0.35µm – 0.8µm • Specialty analog processes • Best-in-class efficiency • Multi-source security: TSMC, UMC, IBM Assembly and test • In-house test in Austria and the Philippines • In-house TSV 3D packaging line in Austria, mass production expected 2014 • Multi-source assembly locations • End-to-end fully integrated supply chain Expansion of wafer fab capacity progressing to plan Additional growth-driven test expansion planned in H2 Confidential © ams AG 2014 Page 17 Global value chain Headquarters Design centers Test center Sales offices • • • 9 design centers Austria, Switzerland, Italy (2), Spain, Slovenia, USA (2), India High volume test center Philippines Continuing growth in distribution design-ins and revenues Over 30 distributors worldwide including Future Electronics, Digi-Key, Mouser Confidential © ams AG 2014 Page 18 Quality and responsibility commitment Quality commitment • Certified under - ISO/TS16949 (automotive) - ISO/TS13485 (medical) - ISO 14001 (environment) • Zero defect commitment with industry-leading field failure rates • Global quality systems with local resources/labs in key markets • Top rankings by customers Corporate responsibility • Member of the UN Global Compact • CDP (Carbon Disclosure Project) participant • Conflict metals/hazardous-use materials program implemented • 70% reduction of CO2 footprint since 2003; mid-term goal to be a carbon-neutral company Confidential © ams AG 2014 Page 19 ams - shaping the world with sensor solutions Company highlights Confidential © ams AG 2014 Page 20 Key figures EURm (IAS) Total revenues Gross margin (excl. acquisition-related costs) (incl. acquisition-related costs) H1 2014 H1 2013 Q2 2014 Q2 2013 192.6 + 9% 176.1 106.3 + 17% 91.2 56% 54% 54% 51% 57% 55% 54% 51% 44.3 39.4 24.7 19.6 26.4 24.0 11.6 9.1 36.9 + 95% 18.9 22.2 + 148% 9.0 3.32 / 3.17 2.72 / 2.60 1.73 / 1.66 1.41 / 1.35 1.99 / 1.91 1.64 / 1.57 0.83 / 0.79 0.67 / 0.64 Result from operations (EBIT) (excl. acquisition-related costs) (incl. acquisition-related costs) Net result EPS (basic/diluted) CHF EUR Confidential © ams AG 2014 Page 21 Financial results EURm Total revenues Total revenues by market H1 2014 250 + 9% 200 150 100 + 17% 192.6 41% 59% 176.1 91.2 50 0 Industrial, Medical, Automotive H1 2013 H1 2014 106.3 Q2 2013 Q2 2014 Total revenues by region 2013 / H1 2014 100% Total backlog 120 80% 59% 48% Asia/Pacific 90 107.1 60% 40% 6% 20% 35% 0% Consumer & Communications 2013 5% Americas 60 47% Europe (EMEA) 30 H1 2014 0 85.5 Mar 31 2014 Consignment stock agreements approx. EUR10-12m Jun 30 2014 Confidential © ams AG 2014 Page 22 Financial results EURm, % of revenues Gross profit, gross margin R&D 60 150 53.7%1) 100 56.5%1) 104.6 90.2 19.5% 53.7%1) 50 46.8 0 H1 2013 H1 2014 56.6%1) 40 19.6% 34.4 58.1 17.8% 16.8% 34.4 20 17.9 17.9 Q2 2013 Q2 2014 SG&A 0 H1 2013 H1 2014 Q2 2013 Q2 2014 EBIT 23.0%1) 60 60 20.7% 40 36.4 14.0%1) 17.8% 40 20.6% 34.2 12.7%1) 17.2% 20 20 18.8 24.8%1) 44.31) 26.41) 24.61) 18.2 11.61) 0 H1 2013 H1 2014 1) Q2 2013 Q2 2014 excl. acquisition-related costs 0 H1 2013 H1 2014 1) Q2 2013 Q2 2014 excl. acquisition-related costs Confidential © ams AG 2014 Page 23 Financial results EURm, % of revenues Net result, EPS (basic/diluted) Operating cash flow 60 60 CHF 3.32/3.17 EUR 2.72/2.60 40 20 CHF 1.73/1.66 EUR 1.41/1.35 36.9 0 22.2 9.0 H1 2013 H1 2014 Q2 2013 Q2 2014 Net cash, cash + short term investments 120 Net cash 90 36.9 CHF 1.99/1.91 EUR 1.64/1.57 CHF 0.83/0.79 EUR 0.67/0.64 18.9 Cash + short term invest. 94.1 34.2 20 0 23.2 H1 2013 H1 2014 Q2 2013 Q2 2014 Capital expenditures 60 40 40.0 71.9 60 48.5 40 32.8 20 30 0 34.0 19.3 11.2 0 Q1 2014 Q2 2014 Q1 2014 Q2 2014 H1 2013 H1 2014 17.0 Q2 2013 Q2 2014 Confidential © ams AG 2014 Page 24 Thank you Please visit our website www.ams.com Confidential © ams AG 2014 Profit and loss statement EURm (IAS) H1 2014 H1 2013 Q2 2014 Q2 2013 192.6 172.3 20.3 176.1 158.3 17.8 106.3 95.5 10.8 91.2 81.5 9.8 Gross profit • Gross margin incl. acquisition-related 104.6 54.3% 90.2 51.2% 58.1 54,7% 46.8 51.3% Research and development Selling, general and administrative Other operating income/expenses - 34.4 - 34.2 3.4 - 34.4 - 36.4 0.2 - 17.9 - 18.2 2.0 - 17.9 - 18.8 - 1.0 Result from operations (EBIT) Operating margin 39.4 20.5% 19.6 11.1% 24.0 22.6% 9.1 10.0% Net financing costs - 0.8 - 0.1 - 0.7 0.0 Result before tax Income tax result 38.6 - 1.7 19.5 - 0.6 23.3 - 1.1 9.1 - 0.2 Net result 36.9 18.9 22.2 9.0 3.32 / 3.17 2.72 / 2.60 1.73 / 1.66 1.41 / 1.35 1.99 / 1.91 1.64 / 1.57 0.83 / 0.79 0.67 / 0.64 Total revenues • Products • Foundry (incl. acquisition-related costs) • EPS (basic/diluted) CHF EUR Confidential © ams AG 2014 Page 26 Balance sheet EURm Jun 30, 2014 Dec 31, 2013 Liabilities and equity Jun 30, 2014 71.9 68.7 50.9 11.6 104.3 63.7 40.5 10.5 Interest-bearing debt Trade liabilities Provisions Other liabilities 5.3 36.7 24.7 30.2 0.8 28.3 23.2 24.1 Total current assets 203.0 219.1 Total current liabilities 97.0 76.3 Fixed assets Intangible assets Investments Deferred tax asset Other non-current assets 182.2 257.8 5.7 33.6 8.1 145.4 243.0 5.1 33.3 7.1 Interest-bearing debt Employee benefits Provisions Deferred tax liabilities Other liabilities 55.4 24.6 23.5 14.5 13.8 59.3 23.6 22.9 13.6 12.6 Total non-current assets 487.4 433.9 Total non-current liabilities Shareholders’ equity 131.7 132.0 461.8 444.7 Total liabil. and equity 690.4 653.0 Assets (IAS) Cash and short term invest. Trade receivables Inventories Other current assets Total assets 690.4 653.0 Dec 31, 2013 Confidential © ams AG 2014 Page 27 Cash flow statement EURm (IAS) H1 2014 H1 2013 Q2 2014 Q2 2013 Income before tax Depreciation 38.6 17.2 19.5 18.0 23.3 8.8 9.1 9.0 Cash flow from operations 48.5 36.9 34.2 23.2 Capital expenditures - 40.0 - 32.8 - 17.0 - 19.3 Cash flow from investing activities - 55.1 - 33.4 - 32.2 - 18.9 Proceeds from borrowings Repayment of borrowings Dividends paid Changes resulting from capital increase 1.0 - 0.4 - 14.1 2.6 0.4 - 2.6 - 19.4 7.9 1.0 - 0.4 - 14.1 1.2 0.1 - 0.7 - 19.4 0.1 Cash flow from financing activities - 26.2 - 16.2 - 24.3 - 23.0 Change in cash and cash equivalents - 32.8 - 12.7 - 22.3 - 18.8 50.5 55.2 50.5 55.2 Cash and cash equivalents at end of period Confidential © ams AG 2014 Page 28