Click to add headline - Global Manufacturing Solutions Briefing 2017... · Global Economy AN UPSWING Undergoing a cyclical recovery, reflecting a rebound in investment, manufacturing

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CONFIDENTIAL AND PROPRIETARY

Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited.

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. CONFIDENTIAL AND PROPRIETARY


A member of

Analyst BriefingIntegrated Micro-electronics Inc.

February 12, 2018

Tower Club, Ayala Avenue, Makati City

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. |

Section

Global Economy I

Our Portfolio II

Updates III

Overall Financials IV

Updates per Region V

2

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. Source:

Global Economy

AN UPSWING

Undergoing a cyclical recovery, reflecting a rebound in investment, manufacturing activity and trade

3

3.7%

2017

3.9%

2019

Advanced

Economies

2.3%

2017

2.3%

2018

2.2%

2019

3.9%

2018

4.7%

2017

4.9%

2018

5.0%

2019

Global Economy

Growth in

emerging market

and developing

economies continue to recover

amid firming prices

2017 2018 2019

US Euro Area Japan

3

2

1

0

6.8% 6.6% 6.4%

2017 2018 2019

China

8

6

4

2

0

Source: International Monetary Fund, and World Bank

3International Monetary Fund

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. |Source:

• Autonomous

driving

• Connectivity

• Ride Sharing

• Electrification

• Rising

electrification

• Green Energy

• Implementation

of regulations

• Increasing

adoption to

small cars

• Advanced driver

assistance

system 19%

CAGR from

2016-2025

• 2017 revenues at

$446M, increased

18% y-o-y

• Automotive 41% of

Total IMI revenues

KEY TRENDS MARKET DRIVERS

Automotive Electronics

4

$

FORECAST PERFORMANCE

Grand View Research

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. |Source: 5

• Emergence of IoT and

related connected

technologies

• Cargo and trailer

tracking devices will

grow at a CAGR

23.2% from 2015-

2020

• Electronic access

control system 9.3%

CAGR 2016-2024

• 2017 revenues at

$189M, increased

25% y-o-y

• Industrial 17% of

IMI Total revenues

• Need for supply chain

visibility and transport

security

$

KEY TREND MARKET DRIVERS FORECAST PERFORMANCE

Industrial Electronics

Berg Insight, Research and Markets Report

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Any use or dissemination of this material without the expressed written permission of AC Industrial Technology Holdings Inc. is strictly prohibited. |Source: 6

• Satellite

communication

systems are

becoming more

capable

• User terminals

becoming smaller

• Low-cost satellite

communication

devices

• Increase in

demand by

various end-use

industries

• Remote sensing

satellite 5.59%

CAGR 2017-

2021

• Aerospace

2017 revenue

at $25M, 2%of Total IMI

revenues

KEY TREND MARKET DRIVER

Aerospace

$

FORECAST PERFORMANCE

Future Market Insights

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RISE OF ELECTRIC VEHICLES

AUTOMOTIVE

Sales of EV will surpass ICE sales by 2038

7Source: Bloomberg New Energy Finance; Europe Autonews

Electric Vehicle (EV)

Internal

Combustion

Engine (ICE)

▪ Average EV assembly time is 40% lesser than conventional ICE

▪ Up to 90% fewer moving parts than ICEs

▪ EV batteries that cost $1000 in 2010 could fall to $70+ by 2030

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Industry 4.0 Revolution

INDUSTRIAL

Disrupting manufacturing standards and expectations

8

• Manufacturing, logistics,

quality & maintenance by

10-20%

• Inventory by 30-50%

• Complexity by 60-70%

COST REDUCTIONS

Source: Boston Consulting Group

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| 9

OVERALL FINANCIALS

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New Program Wins in 2017: $314M58% of New Wins are in Automotive

10

205

314

2014 2015 2016 2017

New Program wins have a CAGR of

15.3% from 2014 to 2017

58%17%

25%

Automotive Industrial Others

Notable Wins in 2017

Controls & Indicators Industrial China

Power Modules Industrial / Automotive Philippines

Steering ECU Automotive China / Mexico

Body Control Automotive Bulgaria

ADAS Automotive Czech Republic

49%

27%

24%

2016 2017

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Automotive Emerging Technologies

11

Battery Management

Next Generation

Displays

Steering/Braking Gear ECU Modules

Body Control

Sensing Camera

Power Modules

Powertrains

EV Charging Modules

LED Lighting

ADAS ECUs and Controls

• PCBA

• Sub-assembly

• Sensors

• Controllers

Power Converter

s

Engine Controls

Total Wins –$314 M

Automotive $181.2 M

Emerging Tech $150 M

$83.1 MEV and ADAS

19% of Total Automotive

Revenue

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|Source:

65.0 70.3

7.7%

6.4%

0.0 %

1.0 %

2.0 %

3.0 %

4.0 %

5.0 %

6.0 %

7.0 %

8.0 %

20.0

30.0

40.0

50.0

60.0

70.0

80.0

2016 2017

EBITDA

EBITDA EBITDA%

843.0 1,091.0 -0.05

-0.03

-0.01

0.0 1

0.0 3

0.0 5

10.0

210 .0

410 .0

610 .0

810 .0

1,01 0.0

1,21 0.0

2016 2017

Revenue

Revenue

28.1 34.0

3.3%3.1%

0.0 %

0.5 %

1.0 %

1.5 %

2.0 %

2.5 %

3.0 %

3.5 %

-

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

2016 2017

Net Income

Net Income NIAT%

101.3 129.6

12.0% 11.9%

0.0 %

2.0 %

4.0 %

6.0 %

8.0 %

10. 0%

12. 0%

-

20.0

40.0

60.0

80.0

100 .0

120 .0

140 .0

2016 2017

Gross Profit

Gross Profit GP%

Year on Year Profit Growth

IMI

▲+27.9%▲+29.4%

▲+20.9%

12

▲+8.3%

▪ $7.7M expense related to transfer of SZ operating site to new Pingshan location

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|Source:

Capital Structure

IMI

Common Shares

48%Short-Term

Debt23%

Long-TermDebt29%

(US$ Millions) Dec

2017

Post-

SRO

Short-term debt 135.1 105.1

Long-term debt 160.0 160.0

Total Bank Debts 295.1 265.1

Cash 90.6 158.1

Net Debt 204.5 107.0

Common Equity 273.7 371.2

Key financial ratios Dec

2017

Post-

SRO

Current ratio 1.28 1.38

Bank Debt/Equity 1.08 0.71

Book value/share ($) 0.147 0.168

Return on common equity

(TTM)

13.3% 11.2%

P/E (TTM) @ ₱20.8 and

TERP

22.7 25.6

13

Common Shares

58%Short-TermDebt16%

Long-TermDebt26%

Dec

2017

Post-

SRO

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|Source:

9.0 7.7

19.59.6

17.6

19.5

9.7

10.6

16.4

5.3

11.0

7.6

1.4

1.9

0.71.5

0.8

3.4

0

10

20

30

40

50

60

70

2015 2016 2017

Philippines China Europe Mexico PSI VIA STI Others

Disciplined Capital Investments

IMI

65.352.2

35.8

Machinery & equipment…..53%

Construction in progress…..20%

Furniture & fixtures...…...…..6%

Buildings & improvements.…10%

PPE - Others.........................12%

$65M2017

14

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|Source: 15

UPDATE BY REGION

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|Source: 16

PHILIPPINES

4.2%

YTD

Sep’17

• Set-up captive camera

lens assembly for new

customer

• Better product mix

leading to lower material

cost ratio

• $98M Won ARP projects;

Significant wins from Auto

Power Module

• Exploring new business

opportunities within

ASEAN and China

REVENUECAPEX

20172016

$9.6

Million

$19.5

Million

Integrated Micro-Electronics, Inc.

$254

Million

2016

$265

Million

2017

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|Source:

CHINA

$271

Million

$261

Million

4.0%

2016 2017

• Shift to higher margin auto

business with 34% y-o-y

growth leading to

increased profitability

• Operations relocation to

Pingshan completed in

early Nov

• $116M Total Won ARP

projects; Significant wins

from Auto Steering,

Braking and Controls

20172016

$17.6

Million

$19.5

Million

REVENUE


CAPEX

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|Source:

18

EUROPE

$244

Million

$278

Million

14%

20162017

• Strong demand by

automotive customers in

Europe

• IMI (BG) recognized as

the 2nd Most Profitable

Company in the Machines

Sector of Bulgaria

• On going construction of

Serbia facility

• $79M Total Won ARP;

Significant wins in

Automatic body and

mirror controls

• Full Year utilization at

90%

20172016

$10.6

Million

$16.4

Million

REVENUE


CAPEX

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|Source: 19

MEXICO

$65

Million

$84

Million

29%

2016 2017

REVENUE

20172016

$11

Million $7.6

Million


CAPEX• Completed purchase and

setup of new building to

accommodate increased

business

• Increased utilization

driving better margins

• Multiple high value

automotive and Industrial

projects undergoing NPI

• $21M Total Won ARP;

Significant wins in

Steering, Braking and

Lighting

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|Source:

• Consolidation of German facilities

• $40M of automotive revenue wins

• Increased utilization from 25% pre-acquisition to 58%

• First time in VIA´s history to exceed EUR 100 mn in revenues

20

VIA

REVENUE

2017

CAPEX

$148M

up 664%

vs 2016

$1.3

Million


Optical bonding

Touch capabilities

Display head assembly

Automotive

Industrial &

Commercial

Consumer

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|Source:

• Active revenue pipeline of up to $200M p.a.; ~50% in Aerospace and Defense

• New quotations ongoing for electric car chargers

• New business won for Smart Metering

• Ongoing integration with IMI

Satellite Communications

Wireless Technologies

Aerospace & Defense

Industrial & Commercial

Research &

Development

21

STI

$45

Million

$0.2

Million


REVENUE

2017

CAPEX

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Thank you.

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Direct line: +63 49 544 0312

https://www.global-imi.com/

IMI IS FUTURE-READY.

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Click to add headline - Global Manufacturing Solutions Briefing 2017... · Global Economy AN UPSWING Undergoing a cyclical recovery, reflecting a rebound in investment, manufacturing