Dec.3 - 4 2018 ULVAC Inc. · 1975: World 1st auto semiconductor equipment order from IBM ... Smart Glass Flexible Devices Packaging Next-Generation Lighting. 8 ... aExpansion of business

1 © 2018 ULVAC, Inc. | Confidential and Proprietary Information

Global Mizuho Investors Conference NY 2018

ULVAC Inc.Dec.3 - 4，2018

(Securities code: 6728)


1. Footsteps of ULVAC


Ulvac：A Venture Established in 1952

Yoshijiro Ishikawa

Yoshio Osawa

First President ULVAC

President Osawa Shokai

AiichiroFujiyama

TamesaburoYamamoto

GenHirose

ChairmanChamber of

Commerce & Industry

PresidentAsahi Beer

President Nissay

Kohnosuke Matsushita

FounderPanasonic

The Six Founders (Angels) of ULVAC


Business History

Smart Society1952

Vacuum Equipment business

Vacuum Application business

1960 1970

Ultra fine particleMaterial

1980 2000 2010

Equipmentcontrol

Surface Analysis

Metallurgy/Chemical

Coating business

Scientific Instruments

Small Flat PanelDisplay

1990

Hybrid EV

1952: 1st order evaporation system for automotive parts plating

Food ▽Barrier packaging ▽ Freezedry

1975: World 1st auto semiconductor equipment order from IBM

Semi-conductorElectrical device

Automotive

▽▽

Photo Voltaic

Pharmaceutical

Large Flat PanelTV

Future Display

Enhanced Info.

Process

EnergySave

Create

High resolution Display

New Energy

Advanced Electronics

Listed on TSE Restructure


2. ULVAC Today


• ULVAC Equipment Sales• ULVAC Techno• ULVAC KIKO• ULVAC Kyushu• Tigold• ULVAC Coating• ULVAC Cryogenics• ULVAC-PHI

• ULVAC Tohoku• Reliance Electric• Showa Shinku• Fine Surface Technology• ULVAC Human Relations• Shinku Ceramics• Nissin Seigyo

• ULVAC China Holding• ULVAC Suzhou• ULVAC Orient• ULVAC Automation Technology• ULVAC Vacuum Furnace• ULVAC Shanghai Trading• ULVAC Material• ULVAC Ningbo• ULVAC Tianma Electric• ULVAC Cryogenics Ningbo• ULVAC Nonferrous Metal• ULVAC Research Center Suzhou• Hong Kong ULVAC• ULVAC Vacuum Equipment• ULVAC Opto-electronics Thin Film Technology

• ULVAC GmbH • ULVAC Technologies• Physical Electronics USA

• ULVAC Taiwan• Ultra Clean Precision Technologies• ULCOAT Taiwan• ULVAC Automation Taiwan• ULVAC Software Creative Technology• ULVAC Materials Taiwan

• ULVAC Korea• ULVAC Korea Precision• Pure Surface Technology• ULVAC Cryogenics Korea• ULVAC Materials Korea• UF Tech

• ULVAC Singapore• ULVAC Malaysia• ULVAC Thailand• ULVAC India Branch

Japan

Japan

Germany

ChinaKorea

Taiwan

North America

Southeast Asia

ULVAC, Inc. siteGroup companiesSales and CS center

• ULVAC India BranchIndia

JapanJapan1616

ChinaChina1515

SEASEA33

KoreaKorea66

TaiwanTaiwan66

USAUSA22

4949

EUEU11

Total Employee6,439

Employee3,208

Employee1,757

Employee616

Employee551

Employee135

Employee156

Employee15

The 66th AnniversaryGlobal Network

As of June 30, 2018


ULVAC, leading the world in vacuum technology

The photos used here are for reference purposes only.

Automobiles Semiconductors Flat Panel TVs Solar Cells Food Products

Aircraft Biotechnology Smart Phones Electromagnetic Devices Consumer Electronics

Space Industry Healthcare & Pharmaceutical Wearable/VR Devices Power Devices MEMS Devices

Fiber-opticsBuilding Materials/ Smart Glass Flexible Devices Packaging Next-Generation Lighting


OLED

NVM3D Xpoint

PCRAM

PowerDevice

IOTDevice

Advanced Materials

Control & Software

Surface Analysis

Equipment /Components

Coating Business

Customer Support

MaterialService

FPDPV

Control / Analysis

Related Business

Vacuum Business

VacuumTechnology

ULVAC’s Product Portfolio


FPD・PV Equipment44%

Semiconductor & Advanced Electronics Equipment

21%

Components13%

Industrial Equipment

9%

Materials6%

Others7%

249.3JPY Billion

VacuumRelated

13%32.6Billion

Vacuum Equipment

87%216.7Billion

FY 2017(Jul. 2017-Jun. 2018) Sales by Segments


249.3JPY Billion

Overseas JapanJapan

30%

China38%

Korea15%

Taiwan7%

Other Asia3% EU, etc.

7%

70%174.5 Billion

30%74.8 Billion

FY 2017(Jul. 2017-Jun. 2018) Sales by Region


ULVAC’s Value Creation

AdvancedTechnology Development

Realize a Spiritual rich & Safe living Environment


High-resolutionLTPS & IGZO

Flexible displayOLED

Large capacity & Low power memory for Big

data/IoT

Communication devices & sensors to

realize IoT

High speed information processing

High end Semiconductor

device

Next Gen.Display

Next Gen.Non Volatile

Memory

AdvancedElectronics,

MEMS

High DensityPackaging

Ultra fine Wiring

Priority Area：Advanced Information Society (IoT)


High PerformanceLow Power

LED

High-efficiencyPhoto Voltaic

EV, Hybrid Automobile Solid stateThin Film Li

Secondary Battery

Si, SiCTransportation,

Consumer Electronics

AdvancedLED

High-efficiencySolar cells

Next Gen.Automobile

SecondaryBattery Power Device

Priority Area：Energy Saving Society


3. Review of Medium-Term Plan


5G accelerates the development of a smart society

Ultra fast x100Ultra low latency x1/10Massive connectivity x100

Increase in multiple connection data

Higher capacity servers, high-speed processing, lower energy consumption

Devices that are multi-functional, environmentally tolerant, small, low-cost, self-powered, and use new energy

Sensors, communication devices, batteries

Cloud computing

Edge computing

Technical innovations required for a smart society

Review of Medium-Term Plan (Business Environment)

Big opportunity seen only once every few decades


High capacityHigh-speed processing

Low power consumption

Multifunctional, environmentally tolerantSmall, low cost

Self-powered, new energies

Next generation non-volatile

memoryNVM

3D-NAND

Logic

High frequency devices

Multi-bandSAW, BAW

Base stationGaN

RF devices

Multifunctional sensorsMEMS

Communication infrastructure

Fiber-optic waveguides

DRAM

High efficiency solar cells

Power storageTFB

Capacitors

Power devicesSiCGaN

High-precision displays, flexibleOLEDs

Imaging devices

Big opportunity seen only once every few decadesTrends in technical innovations

Review of Medium-Term Plan(Business Environment)


108.5 105.0

51.6 56.0

32.8 34.0

23.7 24.015.2 18.017.4 18.0

FY2019 net sales plan (Unit: ¥1 billion)Growth strategy• Semiconductors are poised to grow in

tandem with memory and logic.• Electronics are expected to grow owing

to the business opportunities in technical innovation presented by 5G.

• In FPDs, continued long-term investment is expected primarily in large-screen TVs and OLEDs.

• Growth in components, materials, and customer support (stable base).

• Growth in the China market

Review of FY2019 plan:Net sales of ¥265.0 billion (+¥15.0 billion), operating profit of ¥38.0 billion (+¥3.0 billion)• Review only the plan figures with no changes to the framework of the current medium-term plan.

2017

249.3 255.0

2018

265.0

Other

Materials

General industrial equipment

Components

Semiconductor and electronicdevice production equipment

FPD and PV production equipment

2019 (FY)

Review of Medium-Term Plan (FY2019 Plan)


110.9 108.5 105.0

36.4 51.6 56.0

31.832.8 34.0

21.523.7 24.014.615.2 18.016.717.4 18.0

2017 2018 20192016 (FY)

Net Sales: ¥1 billionOperating profit margin: %

Other

MaterialsGeneral industrial equipmentComponentsSemiconductor and electronic device production equipmentFPD and PV production equipment

231.8249.3 255.0 265.0

Aim for net sales of ¥300.0 billion and an operating profit margin of 16% in FY2022.• Growth based on multiple business lines with high profit margins, such as semiconductors (growth in logic

together with memory), electronic parts (growth due to development of smart equipment), and components

the current medium-term plan

300.0

2022

Review of Medium-Term Plan (Goals)

12.714.2 14.3 14.3

16.0


0

1,000

2,000

2016 2017 2018 2019 2020 2021 2022

OLED LCD

0

100

200

2016 2017 2018 2019 2020 2021 2022

OLED LCD

Continued long-term investment in FPDs is expected

• Continued investment in large-screen TVs

• OLED production equipment for smartphones Restraint in South Korea on near term investmentContinued capex in China

Future OLED market expected to use flexibility and expand to TVs, etc.

(Million m2) (Million Units)TV panel demand forecast Mobile phone panel demand forecast

(Prepared using IHS Markit materials)

Review of Medium-Term Plan(FPD and PV Growth Strategy)


Continued investment in large-screen TVs and OLEDs, more active investment in high efficiency solar cells as well in China

Large-screen TVs

• High productivity: G10.5 substrate compatible→maintain a share near 100%

• High precision: Particle strategy→magnetic suspension system

• Oxide semiconductors: Increase in sputtering→Higher demand for equipment and materials

Large-screen 4K/8K, low-cost, high-precision

OLED Flexible, high-precision

Solar cellsImprovement in conversion efficiency

Sputtering

Vacuum evaporationSputtering

P-CVD

Cat-CVDSputtering

• Process development: Including main units→Support system including processes

• High precision: Particle strategy→Thorough testing on in-house evaluation

equipment

• Capital investment in high-efficiency SHJ*Success in commercial mass production of the world's only SHJ in low-damage Cat-CVD

→Achieve conversion efficiency exceeding 23% by using SHJ

Review of Medium-Term Plan(FPD and PV Growth Strategy)


Poised to grow in tandem with memory (NAND, DRAM, PcRAM) and logic

DRAM, NAND Provide equipment for wiring andrewiring to memory makers

Servers, edge computing, mobile

Next generation non-volatile

memory PcRAM

Deliveries of equipment for mass production are underway.Other memory makers are also thinking about entering the market → market expansion expected in the future

Servers, DIMM/SSD

Logic/foundryNew delivery on major logic lines aincrease share

*Advanced miniaturization process via EUV introduction

MPU/GPU

Wiring film deposition TSV/UBM/RDLNatural oxide layer stripping

MemoryCell film deposition

Wiring film depositionEUV generation MHM*

Review of Medium-Term Plan(Semiconductor and Electronic Parts Growth Strategy)


Technical innovation accelerated by 5G a Expansion of business opportunities in electronic parts production equipment

Power devices

Energy efficiency→Energy saving, high efficiency, low loss

IGBT, SiC, GaN

Communi-cation

devices

Expansion of frequency bandsIncrease in base stations due to higher frequencies→Shift to multi-band

SAW, BAWRF devices

Sensors IoT expansion, installation in cars→ Smaller, higher-performance

MEMS sensors and infrared

sensors

High density packaging

High density packaging→ Smaller, higher-performance

WLP*PLP**

Smaller, more refined, higher density, higher capacity, energy-efficient electronic devicesa Provide an extensive equipment lineup with sputtering target materials and processes

Supporting equipmentSputteringVacuum evaporationCVDEtchingAshingIon implantation

Film deposition materials and processes

Review of Medium-Term Plan(Semiconductor and Electronic Parts Growth Strategy)


By using its characteristics as a vacuum manufacturer, ULVAC is developing diverse businesses in general industry a Globalization

Heat exchangersRadiators, EGR coolers, electronic parts cooling, etc.→ Vacuum brazing furnaces, vacuum leak

testing

Rare-earth magnets for electric motorsHV, EV, and similar vehiclesWind power, home appliances→ Vacuum sintering furnaces and melting

furnaces

High efficiency solar cellsFor high efficiency SHJ*→ Cat-CVD equipment

The world’s only commercial mass production facility

*Silicon heterojunction

High function filmsHigh efficiency capacitors in HV, EV, and similar vehicles→ Share of more than 90% in evaporation roll

coater

Drugs and foodGeneric drug manufacturingExtraction of high purity substances→ Vacuum freeze-drying equipment

Vacuum distillation equipment

Resin fuel tanks→ Vacuum leak testing

Review of Medium-Term Plan(Growth Strategy in Diverse Fields)


Component growth strategy• Expansion of vacuum applications (general industry)• Expansion of refrigeration business (advanced

technology)• Demand due to expansion of device market in China• Expansion of production and sales due to group

synergies• Improved lineup by means of alliances

*Components: Components essential to vacuum equipmentVacuum pumps, vacuum gauges, vacuum valves, vacuum leak testers, gas analyzers, power supply for film formation, etc.Delivery to vacuum device makers, device customers, etc.

Cryo pumpsVacuum valves

Film deposition controllersDry pumps

Vacuum evaporation equipment for OLED

manufacturing

Medical MRI example

4K refrigerators for cooling superconductive magnets

Component* strengths• In-house manufacture of various equipment• Diverse lineup• High reliability by linking with vacuum equipment• Diverse customers• Production of vacuum pumps in China for more than

20 years

Liquid nitrogen generators that manufacture and store liquid nitrogen from airUse in research and medical settings

Review of Medium-Term Plan(Component Growth Strategy)


Strengths in materials*• Production locations near customers (Japan, China, South

Korea, Taiwan)• Material development in conjunction with the deposition

process→Ultra-materials research lab

• Sampling system using mass production machines• Development of new materials and applications

Materials growth strategy• Meet the demand due to increased equipment operation in

China→Suzhou, China plant (FPDs, semiconductors, etc.)

• Meet the increasingly sophisticated demand for FPD and semiconductor manufacturing processes→High definition (wiring material AL→Cu, thicker film)→Increased mobility (a-Si→oxide IGZO, etc.)→Foldability

• Provide support for high-tech applications→(Nb materials, etc. for high-performance accelerators)

Target used in sputtering

Acceleration cavity for high-performance accelerators

(Use high-purity Nb materials)Sputtering systems for

large-screen TV manufacturing

*Materials businessUse in sputtering, i.e., the main method of vacuum depositionDevelop business based primarily on targeted materialsWork also on developing and manufacturing function materials

Sputtering systems for semiconductor manufacturingTarget used

in sputtering

Review of Medium-Term Plan(Materials Growth Strategy)


Field support (maintenance)

Parts sales

Cleaning and surface

treatment

Sales of refurbished

used machines

Modification/improvement

Growth strategy in the customer support business• Global deployment• Upgrading and expansion of the field support

system• Maintenance of products made by other companies• Expansion of used machine sales business• Expansion of proposals for

modification/improvement

(Strengths in the customer support business)• Support throughout the life cycle• Domestic/overseas network (near customers)

71 locations in 14 countries(33 in Japan, 15 in China)

• Comprehensive maintenance including components• Continuous improvement including processes,

proposals for change

Before refurbishing

After refurbishing

Review of Medium-Term Plan(Growth Strategy in the Customer Support Business)


Shenyang

DalianBeijing

Xian

Chengdu

HefeiNingbo

JingjiangSuzhou

Shanghai

Shenzhen

Hong Kong

0%

20%

40%

60%

80%

100%

2005 2010 2015 2017

日本台湾韓国中国その他アジア欧米

Percentage of sales to China

• Revitalization of investment in FPDs (large-screen TVs and OLEDs), semiconductors, and electronics due to policies advocating domestic production

• Increase in demand for components, materials, and customer support

Strengths of the China market• Network

→Approximately 1,600 employees in 15 companies• Supply chain

→Local production of G8.5 sputtering equipment• Local management

Growth strategy• Reinforcement of the sales and production system• Growth in FPDs, semiconductors, and electronics• Expansion of the component, material, and customer

support business in tandem with an increase in delivery equipment

Service locationsMajor manufacturing locations

# of employees

Guangzhou

Amoy

WuhanChongqing

Ordos

15Group companies

in China

1,588

13Manufacturing locations

in China

15Service locations

in China

# of employees

Japan

China

Taiwan KoreaOther Asian N. A. & EU

Review of Medium-Term Plan(Growth Strategy in the China Market)


Strengths in production and procurement• Production locations and supply chains have been built

in Japan, China, and Taiwan(1) Flexible coordination of production among locations(2) Engineers at each location respond across borders

a Increase in sales, response to delivery requests

Growth strategy• Production near customers• Collaborative manufacturing among our facilities• Further expansion of local suppliers

Kagoshima, Kyushu

Fuji Susono

Hachinohe, Tohoku

Suzhou, China

Pyeongtaek, South Korea

Tainan, Taiwan

Major production locations

ChigasakiHeadquarters

and Plant

Mega factory

Review of Medium-Term Plan(Strengths of the Production System)


４. Review of FY2017 (Jul.2017-Jun.2018) Consolidated Business Results


June '17

Result Plan*1 Revised*2 Result

Ordersreceived 235.5 245.0 265.0 243.0 7.5 3.2%

Orders back-log 106.3 - - 100.0 - -

Net Sales 231.8 239.0 250.0 249.3 17.4 7.5%

OperatingProfit 29.5 31.0 35.5 35.4 5.9 20.0%

Ratio 12.7% 13.0% 14.2% 14.2% + 1.5 pt

Net Income 24.5 25.5 30.5 35.9 11.4 46.7%

Ratio 10.6% 10.7% 12.2% 14.4% + 3.8 pt

June '18 Y-o-Y

(Change)

(Unit: ¥1 billion)

• Orders received, net sales, and profits were up year-on-year• The operating profit margin also increased 1.5 points year-on-year, owing to semiconductor and

electronic parts production equipment etc.• Net profit increased by 47% due to deferred tax assets and gains on sales of stocks

*2: Figures published in February 2018*1: Figures published in August 2017

112.0 119.8 125.3 124.0

14.4 15.1 18.7

16.7

0

15

30

45

0

50

100

150

Operating profit

Net sales

1H FY2016

Net sales and operating profits (by semi-annual period)

2H 1H 2H FY2017

Summary of FY2017 Consolidated Business Results


Highest sales ever, record-breaking profits for three consecutive termsOrders received: ¥243.0 billion (+3% year-on-year)- Owing to an increase in capital expenditures for memory, orders for semiconductor and

electronic parts increased significantly, and orders for components were higher year-on-year.

Net Sales: ¥249.3 billion (+8% year-on-year)- Net sales of semiconductors and electronic parts were up year-on-year.

Operating Profit: ¥35.4 billion (+20% year-on-year)- Operating profit was up year-on-year, with all profit categories at high levels.

Dividends- Dividend (per share): ¥95 (+¥45 year-on-year)

Summary of FY2017 Consolidated Business Results Highlights


• Because of an increase in the weight of semiconductor and electronic parts production equipment, which has high profit margins, both the gross profit margin and operating profit margin rose.

24.5 24.3

26.627.5

29.3

20

25

30

35

Gross profit margin(Unit: %)

FY2017FY2016FY2015FY2014FY2013

6.9 6.2

9.3

12.7

14.2

5

10

15

20

Operating profit margin(Unit: %)

FY2017FY2016FY2015FY2014FY2013

Summary of FY2017 Consolidated Business Results Highlights(Profit Margins)


0

50

100

150

200

250

110.9 108.5

36.4 51.6

31.832.8

21.523.714.615.216.717.4231.8249.3

0

50

100

150

200

250

113.7 93.0

37.654.1

31.1 33.1

22.7 29.415.1 15.415.3 18.0235.5

243.0

FY2017

Other

Materials

General industrial equipment

Components

Semiconductor and electronicparts production equipment

FPD and PVproduction equipment

FY2016 FY2017FY2016

(Unit: ¥1 billion) (Unit: ¥1 billion)Orders Received Net Sales

• FPD and PV production equipment: Investment in LCDs for large-screen TVs and OLEDs for smart phones, particularly in China, remains high

• Semiconductor and electronic parts production equipment: Backed by strong server demand, there was an increase in production equipment for memory (NAND, DRAM, next generation non-volatile memory). Up significantly year-on-year

Summary of FY2017 Consolidated Business Results(Orders Received and Net Sales by Segment)

34 © 2018 ULVAC, Inc. | Confidential and Proprietary InformationOtherMaterialsGeneral industrial equipment

ComponentsSemiconductor and electronic parts production equipmentFPD and PV production equipment

• Net sales continued to perform at a high level.• Orders received: Sales negotiations are expected to be concentrated in the 1Q more than initially planned

(1H ¥140.0 billion, 2H ¥105.0 billion).• Large deals expected in June ended up sliding to the next term, which caused a temporary decline (expected

to recover in 1Q of the next term).

0

20

40

60

80

100

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

28.8 20.6

40.8

21.2 22.7 30.9 27.3

32.8

47.5

17.3 11.9 16.2

7.5

8.0

8.5

7.4 8.2

10.6 8.9

9.8

9.3

23.1

13.3 8.4

6.6

6.3

7.5

7.7 6.7

7.4 9.1

7.8

8.0

7.9

8.7 8.5

5.0

5.3

4.8

5.4 5.1

5.2 7.0

5.5

8.5

7.0

7.9 6.0

4.4

4.6

3.5

3.3 3.7

4.2 3.4 3.8

4.0

5.0

3.3 3.1

4.2

4.7

4.1

3.4 3.6

3.4 3.7 4.6

3.7

5.0

3.8 5.5

Orders Received (Unit: ¥1 billion)

FY2015 FY2016 FY2017

0

20

40

60

80

100

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

20.6 24.1 20.4 17.8 22.7 29.4 29.4 29.4 28.9 28.1 28.3

23.2

9.1 8.0

8.15.7

8.2

9.6 9.5 9.1 10.9 13.4 14.9

12.46.3 6.4

6.66.8

7.2

8.5 8.8 7.3 8.6 7.8 8.2

8.36.0 5.4 5.3

4.1

4.2

6.0 5.4 5.9 5.3 5.6 6.3

6.54.2 4.1

3.43.4

3.8

4.0 3.4 3.4 4.0 4.3 3.1

3.84.0 4.7

4.33.9

3.9

4.5 3.8 4.4 3.2 5.2 4.14.9

Net Sales (Unit: ¥1 billion)

FY2015 FY2016 FY2017

Summary of FY2017 Consolidated Business Results(Orders Received and Net Sales by Segment: Quarterly)


• Total assets increased due to increases in orders received and net sales, but net assets also increased by ¥49.2 billion and the equity ratio improved to 49.5% due to increases in net profit and in the market valuation of investment securities.

• Interest-bearing debt decreased by ¥7.0 billion, and net cash improved to ¥21.4 billion.

78.0 104.9

154.1 12.1

11.9

10.7

31.4

36.9

41.7

62.7

42.7

35.7 35.3

48.8

55.6

0

100

200

300Notes and accountspayable, trade

Interest-bearingdebt

Other currentliabilities

Other long-termliabilities

Net assets

(Unit: ¥1 billion)Liabilities and Net Assets

FY2015 FY2016 FY201715.6 15.3

36.4

60.4 60.3 64.3

10.5 12.5

13.6 29.5 30.2

39.1 58.0 70.5

87.3 45.7 56.4

57.1

0

100

200

300Cash on hand and inbanks

Notes and accountsreceivable, trade

Inventories

Other current assets

Property, plant andequipment

Investment securities,etc.

(Unit: ¥1 billion)

FY2015

Assets

FY2016 FY2017

Summary of FY2017 Consolidated Business Results(Consolidated Balance Sheet)


５．FY2018 (Jul.2018-Jun.2019) Consolidated Earnings Forecast


• Orders received, net sales, and operating profit are expected to increase year-on-year• Net profit is expected to decrease in reaction to the posting of deferred tax assets last year

125.3 124.0 125.5 129.5

18.7 16.7

19.5 17.0

0

15

30

45

0

50

100

150Forecast

Operating profit

Net sales

1H FY2017

Net sales and operating profits (by semi-annual period)

2H 1H 2H FY2018

FY2018 Forecast

1H Full Year ChangesY-o-Y17.0

+7.0％

Orders back-log 100.0 94.5 105.0

5.7+2.3％

1.1+3.3％

Ratio 14.2% 15.5% 14.3%▲ 10.4

-29.0%

FY2017Results

Net Income

Ordersreceived

Net Sales

Operating profit

14.0 25.5

243.0

249.3

35.4

35.9

120.0 260.0

125.5 255.0

19.5 36.5

(Unit: ¥1 billion)

FY2018 Consolidated Earnings Forecast


0

50

100

150

200

250

300

66.7

111.4 113.793.0 106.0

35.9

31.4 37.654.1

55.526.2

28.131.1 33.1

35.0

23.9

20.422.7 29.4

26.5

13.1

15.815.1 15.4

19.5

16.8

16.415.3 18.0

17.5

(Unit: ¥1 billion)

2014 2015 2016 2017

Forecast

2018

182.7

223.6235.5

243.0260.0

Other

MaterialsGeneral industrial equipmentComponents

Semiconductor and electronicparts production equipment

FPD and PVproduction equipment

Orders Received

FY

• FPD and PV manufacturing equipment orders received and net sales are expected to continue at the ¥100.0 billion level

• Almost all other product categories, including semiconductor and electronic parts production equipment and components, are expected to exceed last year's performance

0

50

100

150

200

250

300

59.782.8

110.9 108.5 105.0

36.0

30.9

36.4 51.6 56.0

26.526.0

31.832.8 34.0

25.520.7

21.523.7 24.0

14.415.1

14.615.2 18.0

17.116.9

16.717.4 18.0

(Unit: ¥1 billion) Forecast

179.2192.4

231.8249.3 255.0

Net Sales

2014 2015 2016 2017 2018FY

FY2018 Consolidated Earnings Forecast(Orders Received and Net Sales by Segment)


24.3

26.627.5

29.3 29.6

20

25

30

35

Progression of gross profit margin

(Unit: %)

FY2018FY2017FY2016FY2015FY2014

Forecast

6.2

9.3

12.7

14.2 14.3

5

10

15

20

Progression of operating profit margin

(Unit: %)

Forecast

FY2018FY2017FY2016FY2015FY2014

• Gross profit margins and operating profit margins are expected to remain at high levels

FY2018 Consolidated Earnings Forecast(Profit Margins)


• R&D investments (capital expenditures for R&D + R&D expenses) are expected to continue increasing• Active development is expected to lead to future growth, along with efforts in next generation

displays/logic, next generation non-volatile memory

0

5

10

5.66.3

6.9

8.3

9.7

(Actual and forecast R&D expenses)

Forecast

FY2014 FY2015 FY2016 FY2017 FY2018

(Unit: ¥1 billion)

0.0

5.0

10.0

15.0

20.0

3.9 4.1 4.1

7.2 9.6

7.6 6.9 6.4 6.5 7.6

Depreciation

R&D

Building, Repair etc.

6.7

8.37.0

12.9

15.6

(Actual and forecast capital expenditures)

FY2014 FY2015 FY2016 FY2017 FY2018

(Unit: ¥1 billion)

Forecast

Total Investment

FY2018 Consolidated Earnings Forecast(Progression of Capital Expenditures and R&D Expenses)


(¥)

The dividend payout ratio (actual) is calculated based on profit after deducting additional deferred tax assets and gains from sales of stocks

Dividends are implemented giving full consideration to factors such as expansion of the financial base for further investment in growth, consolidated performance each year, and dividend payout ratio.

• The FY2017 dividend is ¥95 per share, in line with the forecast• The dividend is forecast to increase by ¥10 to ¥105 in FY2018• Since the recovery in FY2014, the dividend has continued to increase

(¥)

FY2016 FY2017(Plan)

FY2018(Forecast)

Dividend per share(vs. last year)

¥50(+¥20)

¥95(+¥45)

¥105(+¥10)

10 3050

95 10513.0%

5.8%

8.9%10.1%

16.4%20.3%

0%

6%

12%

18%

24%

0

30

60

90

120

FY2014 FY2015 FY2016 FY2017(Plan)

FY2018(Forecast)

Dividend per share Payout ratio Payout ratio (actual)

*

FY2018 Consolidated Earnings Forecast(Year-end Dividend)


６．Business Results of 1Q FY2018（July-September 2018)

43 FY181QPSN20181109E© 2018 ULVAC, Inc. | Confidential and Proprietary Information

Orders Received: ¥77.7 billion (-4% year-on-year, +63% vs. 4Q FY2017)- Incoming orders were sluggish at one point in the second half of last year, but they

recovered in the current quarter.

Net Sales: ¥61.7 billion (+1% year-on-year, +4% vs. 4Q FY2017)- Net sales continue at a high level.

Operating Profit: ¥8.7 billion (-3% year-on-year, +56% vs. 4Q FY2017)- Operating profit recovered after a temporary decline in the previous quarter.

Earnings forecasts for the year ending June 2019 remain unchanged from the figures released in August.

Highlights of First Quarter FY2018 Business Results


FY2017 1Q

Results Results Y-o-Y (Changes)

Orders Received 81.0 77.7 -4.0%

Net Sales 60.9 61.7 1.3%

Operating Profit 8.9 8.7 -2.6%

Ratio 14.6% 14.0%

Net Income 6.3 6.1 -4.0%

Ratio 10.4% 9.9%

FY2018　1Q60.9

64.3 64.9 59.1 61.7

8.99.8

11.1

5.6

8.7

0

5

10

15

20

0

20

40

60

80(Unit: ¥1 billion)

• Orders received were flat compared with the same period last year due to large orders for FPD production equipment.• Net sales were flat compared with the same period last year due to contributions from semiconductor and electronic

device production equipment.• Operating profit recovered to the level of the same period last year.

Operating profit

Net sales

Progression of net sales and operating profit (quarterly)

1Q 2Q 3Q 4Q 1Q

FY2017 FY2018

Overview of First Quarter FY2018 Business Results


0

50

100

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q

22.7 30.9 27.3

32.8

47.5

17.3 11.9 16.2

42.4 8.2

10.6 8.9

9.8

9.3

23.1

13.3 8.4

11.3

6.7

7.4 9.1

7.8

8.0

7.9

8.7 8.5

10.5

5.1

5.2 7.0

5.5

8.5

7.0

7.9 6.0

5.5

3.7

4.2 3.4 3.8

4.0

5.0

3.3 3.1

3.8

3.6

3.4 3.7

4.6

3.7

5.0

3.8 5.5

4.3

50.0

61.8 59.4 64.3

81.0

65.4

48.9 47.7

77.7

0

50

100

47.5 42.4

9.311.3

8.0 10.5

8.5 5.54.0

3.83.7

4.3

81.0 77.7

FY20181Q

Other

MaterialsGeneral industrial equipmentComponents

Semiconductor and electronic device production equipmentFPD and PV production equipment

FY20171Q

(Unit: ¥1 billion)Vs. same period last year

• FPD and PV production equipment: Orders received were at a high level due to large orders of large-screen LCD production equipment for China• Semiconductor and electronic device production equipment:

Overview of First Quarter FY2018 Business Results (Orders received by segment)

Quarterly change (Unit: ¥1 billion)

FY2016 FY2017 FY2018

Semiconductor production equipment orders for memory and logic contributed, and orders for telecom devices and power semiconductors were also strong.


0

50

100

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q

22.7 29.4 29.4 29.4 28.9 28.1 28.3 23.2 26.4

8.2

9.6 9.5 9.1 10.9 13.4 14.912.4

12.77.2

8.5 8.8 7.3 8.6 7.8 8.2

8.39.4

4.2

6.0 5.4 5.9 5.3 5.6 6.3

6.56.0

3.8

4.0 3.4 3.4 4.0 4.3 3.1

3.83.8

3.9

4.5 3.8 4.4 3.2 5.2 4.14.9

3.550.1

61.9 60.4 59.5 60.964.3 64.9

59.161.7

Other

MaterialsGeneral industrial equipmentComponentsSemiconductor and electronic device production equipment:FPD and PV production equipment

(Unit: ¥1 billion)

• FPD and PV production equipment: LCD production equipment for large-screen TVs and OLED production equipment for smartphones contributed.

• Semiconductor and electronic device production equipment: Mainly equipment for memory and telecom devices performed at high levels.

Overview of First Quarter FY2018 Business Results (Net sales by segment)

(Unit: ¥1 billion)

FY2018FY2016 FY2017

Vs. same period last yearQuarterly change

FY20181Q

FY20171Q

0

50

100

28.9 26.4

10.9 12.7

8.6 9.45.3 6.04.0 3.83.2 3.5

60.9 61.7


23.924.6

26.326.9 27.627.2

29.6 29.731.0

26.9

28.7

15

25

35

Gross profit margin Operating profit margin(Unit: %) (Unit: %)

• Profit margins recovered after declining at one point in the previous quarter due to an increase in research and development expenses.

FY2018FY2017FY2016

1H 1Q 2Q 3Q 4Q2H 1H 2H 1H 2H 1Q

FY2014 FY2015 FY2018FY2017FY2016

1H 1Q 2Q 3Q 4Q2H 1H 2H 1H 2H 1Q

FY2014 FY2015

5.86.5

10.48.7

12.9

12.6

14.615.2

17.1

9.4

14.0

0

10

20

Overview of First Quarter FY2018 Business Results (profit margins)


154.1 151.2

10.4 10.2

41.7 38.8

35.7 33.7

55.6 56.5

0

100

200

300

Note and accountspayable, trade

Interest-bearing debt

Other current liabilities

Other long-termliabilities

Net Assets

41.1 35.9

64.3 64.1

8.6 6.4

39.1 41.6

87.3 84.6

57.1 57.9

0

100

200

300

Cash on hand and inbanks

Notes and accountsreceivable, trade

Inventories

Other current assets

Property, plant andequipment

Investment securities,etc.

Overview of First Quarter FY2018 Business Results (consolidated balance sheet)

(Unit: ¥1 billion) (Unit: ¥1 billion)

FY2017

Assets Liabilities and Net Assets

FY20181Q

• Notes and accounts receivable plunged by ¥2.6 billion, while inventory assets grew by ¥2.5 billion, and interest-bearing debt was reduced by ¥2.0 billion.

• The equity ratio improved to 49.9% and net cash to ¥24.2 billion.

FY2017 FY20181Q

“Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28, Feb. 16, 2018) was adopted at the beginning of the first quarter. Figures for the prior consolidated fiscal year were restated after retrospective application of said accounting standard.


Topic “Stronger Corporate Governance”Introduction of New Directors• We now have four external directors serving on the board, which exceeds one-third of the 10 directors.• Three directors each were appointed from development, production, and sales.

Yoshimi Nakajima

New directors and managing executive officers

Dr. Choong Ryul Paik (General Manager, R&D

Headquarters)

Shigemitsu Sato (General Manager,

Advanced Manufacturing Division)

Masahiko Ishiguro (General Manager, Corporate Sales & Marketing Division)

New director (independent external)


Topic “Industry-Academia Collaboration: Opening a Lab in Osaka University”• The ULVAC-Osaka University Joint Research Laboratory for Future Technology opened on November 1, 2018 on the

campus of Osaka University.• Through a collaboration between industry and academia, ULVAC and Osaka University will exchange researchers and

build an R&D network, as well as develop scholarly work in the medical and bio-engineering field, solve technical issues, and contribute to the training of innovative university personnel.

• ULVAC will be positioned as a place for basic research, with an eye on investigating next-generation FPD applications based on ULVAC’s pioneering technology and on creation of semiconductor quantum dots for artificial photosynthesis, along with their enabling mass production technologies, and as a place for generating new value in areas such as medical applications (cell preservation) for ultra high-speed freeze drying technology.

Overview of the ULVAC-Osaka University Joint Research Laboratory for Future TechnologyName: ULVAC-Osaka University Joint Research Laboratory for Future Technology

(ULVAC Future Technology Research Laboratory, Osaka Research Division)

Location: Osaka University, Suita Campus, Suita Welfare Center, 4th Floor

Organization: Lab Director - Takao Yamamoto(Professor, Osaka University, Graduate School of Engineering)

Deputy Director - Hirohiko Murakami(Head and Senior Fellow, ULVAC Future Technology Research Laboratory)

Including the above, there will be 11 faculty and researchers (including adjuncts)

Osaka University, Suita Campus, Suita Welfare Center


ULVAC, leading the world in vacuum technology


Leading the World

In Vacuum Technology

Documents

Dec.3 - 4 2018 ULVAC Inc. · 1975: World 1st auto semiconductor equipment order from IBM ... Smart Glass Flexible Devices Packaging Next-Generation Lighting. 8 ... aExpansion of business