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ROFIN-SINAR Technologies
Nasdaq RSTI US 7750431022
FY 2015 / 9 M
Investor Presentation, August 2015
Page 2
During the course of this presentation, we will make projections or other forward-looking statements regarding future events or the future financial performance of the Company. We wish to caution you that such statements reflect only our current expectations, and that actual events or results may differ materially.
We refer you to the risk factors and cautionary language contained in the documents that the Company files from time to time with the U.S. Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2014. Such documents contain and identify important factors that could cause our actual results to differ materially from those contained in our projections or forward-looking statements.
We undertake no obligation to update such projections or such forward-looking statements in the future.
.
„Safe Harbor“ Statement Under the Private Securities Litigation Reform Act
SAFE HARBOR STATEMENT
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Standort Hamburg
Company Brief Revenue Snapshot
- Headquartered in Plymouth, MI,
and Hamburg (Germany)
- Worldwide over 2,230 employees
- Over 4,000 customers around the globe
- Global production, sales & service network
- Installed base of 52,000 laser units
- Focus on three primary laser applications:
MACRO, MICRO & MARKING
is a global leader in the development and manufacture of lasers and laser-based technologies for industrial material processing applications
Asia34% Europe
44%North America
22%
Split by region 9M/FY2015
FY 2015/9M: $377.7 million FY 2014 : $530.1 million
INDUSTRY & MARKET LEADER
Macro38% Micro &
Marking47%Com-
ponents15%
Split by application 9M/FY2015
Page 4
Additional Group Brands
such as NUFERNComplement The Group’s
Laser & Component Portfolio
INDUSTRY‘S BROADEST PRODUCT OFFERING
Primary applications:
Cutting, Welding, Surface TreatmentWith High Output
Powers
Primary applications:
Fine Cutting & WeldingMicro Structuring
Perforating With Low To Medium Output Powers
Primary applications:
Marking & EngravingWith Low Output Powers
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CURRENT MARKETS & GROWTH DRIVERS
Total Net Sales: FY 2015/9M: $377.7 million (thereof laser-related: $217.2 million)FY 2014: $530.1 million (thereof laser-related: $308.7 million)
Primary Markets
Machine tool 37%
Automotive & Sub-Suppliers 12%
Consumer electronics
Photovoltaics 22%
Semiconductor
Medical device industry
Flexible packaging 29%
Others (i.e. M&D, Watch, Jewelry)
Current Market Situation
As
per
cent
age
ofla
ser-
rela
ted
sale
s
High-power fiber laser sales continue to gain momentum & stable business for high-power CO2 lasers – not only in China
Good demand across a wide range of applications. Outlook strongbased on good project base
New projects with focus on USPL; First orders from potential volumecustomers f. cutting of brittle materials w. FiLaser technology
Solar business: Excellent sales level in Q3 for thin film & crystalline solar cell applications
Business level increased in Q3; stable marking business & higherrequests for micro applications also with ultrashort pulse lasers
Good business level across all continents
Stable, project-based business
M&D: Depending on US programsWatch: Switzerland-based; Jewelry sector: very stable demand
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GLOBAL PRODUCTION, SALES & SERVICE NETWORK
Appendix - Company
- More than 20 production facilities in North America, Europe & Asia - Customer service support in over 50 countries - Over 150 sales engineers & approx. 430 customer service personnel- Regional & industry specialized sales engineers
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STRATEGIC BENEFITS OF GLOBAL REACH
Global production flexibility
Global sales and service capabilities combined with ability to deliver local
customer focus and solutions
Global application centres
Large, global installed base of approximately 52,000 units drives strong
recurring service and parts business
Revenues from service and spare parts typically > 25% of revenues
Local management with in-depth market know-how
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~ US$ 2.6 billion + 6%
Thereof:
* Source: Industrial Laser Solutions (1/2015): The presentation mode of ILS has changed – category „other“ includes i.e. direct diode lasers. * Data for revenueswith laser units only! All industrial lasers excluding excimer!
Leader in CO₂ lasers and #2 in faster growing fiber lasers, by revenue
Fiber laser market projected to grow at approx. 14% annual rate
~ US$ 2.8 billion + 5%Thereof:
34%
17%
36%
13%
CO2
SSL
FL
Other
32%
16%
39%
13%
CO2
SSL
FL
Other
Global Laser Revenues 2014* Global Laser Revenues 2015 E*
GLOBAL GROWING INDUSTRIAL MATERIALS PROCESSING MARKET IN 2014
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GSI
C02 laserincl. Slab Technology
Lamp/Diode-pumped SSL
Fiber laser
Diode laser
Ultra-short pulse
*
()
()
Main competitor in terms of:
- fiber lasers (#1)- global presence- market share
*
?
Covering alltechnologies
#2 in fiber lasers
Main competitorin terms of:- portfolio- global presence- market share
* Fiber laser = SPI Laser& JK Laser
Strong in micro-electronics withUV and excimerLasers
#1 in low-powerCO2 lasers byunits (Synrad)
Changing tosystemmanufacturer; less lasermanufacturer
Strong in science& research; lessin industrial app-lications
High power
Low power
High power
Low power
High power
Low power
High power
Low power
High power
Low power
High power
Low power
High power
Low power
MOST DIVERSE IN COMPETITIVE LANDSCAPE
Company
Industrial Lasers
CompetitivePosition
Capabilities across all important industrial laser technologies position ROFIN todeliver solutions to a global customer base
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ROFIN’s Comprehensive Range of Fiber Lasers
Fiber laser-related figures FY2015/9M: Sales: 873 Units (USD 62.2 million)Order Entry: 944 Units (USD 72.5 million)Backlog: 457 Units (USD 47.6 million)
MEDIUM-POWER SERIESHIGH-POWER SERIES LOW-POWER SERIES & AMPLIFIERS
POSITIONED TO TAKE SHARE OF GROWING$950MM+ FIBER LASER MARKET
Supported by internally developed and acquired technologies
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ROFIN’s FIBER LASER TECHNOLOGY
PRODUCTION OF DIODESPRODUCTION OF DIODES
LOW IMPACT
LOW RISK
WAFER
1
LOW IMPACT
LOW RISK
DIODE PACKAGE
23
LOW IMPACT
LOW RISK
FIBER PREFORM4
LOW IMPACT
LOW RISK
ACTIVE FIBER 5
LOW IMPACT
LOW RISK
FIBER LASER MODULE
From Chips toMulti-kW Fiber Lasers
Technology
Vertical integration!
VERTICALLY INTEGRATED FIBER LASER PRODUCTION
6
LOW IMPACT
LOW RISK
FIBER LASER UNIT w. PUMP MODULE
LOW IMPACT
LOW RISK
7
FIBER LASER
Positioned to benefit from substantial investment made to achieve vertical integration
Page 12
PUMP MODULE & FIBER LASER UNIT
300 W pumping modules used in production
12 x 300 W Pump Modules
POWER SCALING BY POWER COMBINING
2 kW fiber laser units used in production
Scaling Fiber Laser Units to Multi-kW
ROFIN‘s PROPRIETARY FIBER LASER DESIGN
IMPROVED COMMERCIAL PRODUCTION OF HIGH-POWER FIBER LASERS
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Potential for ”Cold Material Processing” with Ultrashort Pulse Lasers
Suitable for bio-absorbable polymers
Ultrashort pulse lasers such asfemto- and picosecond lasersopen up new applications in various markets, i.e. in themedical device, semiconductor orsolar sector
So-called „cold lasers“ processmaterials faster than energy candiffuse within the atomic lattice. Therefore no heat is transferredto the surrounding material, whicheliminates any recast and burr. Dramatically reduced post-processing is the consequence.
2nd GROWTH FOCUS USPL: NEW PRODUCTS & APPLICATIONS
ROFIN one of first companies to commercialize technology for industrial applications
Page 14
Applications
Consumer electronics
Automotive
Semiconductor
Medical device
PV
Filament cutting of brittle material with ROFIN‘sproprietary and IP protected smart cleave process
High precision drilling, like GDI, injector nozzle, also used in medical device
Ablation of layers
Cutting
USPL: MARKETS & APPLICATIONS
Markets
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KEY DRIVERS OF MARGIN IMPROVEMENT
Blended fiber laser gross margin improvement through optimized design and vertical integration
25% reduction in high-power fiber laser product cost projected for 2015, significantly improving gross margins, with further improvement expected in 2016
Gross margin improvement based on current pricing outlook
Incremental benefits from growing scale in fiber lasers & ultrashort pulse lasers
Greater absorption of fixed costs
Introduction of new applications with ultrashort pulse lasers
New product introductions across existing technologies
Projecting to achieve consolidated gross margins of approximately 40% by the end of FY 2015
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511
602
294
475
612
534 531553
394
480
575
350
424
598
540560
530
378
117143
88
139 153 147118
141158
0
10
20
30
40
50
60
70
0
100
200
300
400
500
600
700
2007 2008 2009 2010 2011 2012 2013 2014 2015/9M
Order Entry Revenue Order Backlog Net Income *
Financial Crisis
FY2015/9M
US$/Euro: 0,75 0,67 0,74 0,74 0,72 0,77 0,76 0,74 0,86 * Attributable to RSTI
In Mio. USD
KEY FINANCIALS – HISTORICAL OVERVIEW
Net Income: 26.5 Mio.
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KEY FINANCIALS – HISTORICAL OVERVIEW
* Excl. intangibles amortization - ** Except per share amounts
KEY FIGURES (in US$ million**) 2009 2010 2011 2012 2013 2014 2015/9M
CASH FLOW (in US$ million) 2009 2010 2011 2012 2013 2014 2015/9M
Revenue 349.6 423.6 597.8 540.1 560.1 530.1 377.7Cost of goods sold * 217.5 257.3 365.7 343.8 363.6 341.2 237.4Gross profit 132.1 166.3 232.1 196.4 196.5 188.9 140.3Selling, general & administrative * 88.9 89.9 107.5 101.1 101.7 106.1 73.2Research & development* 31.5 30.1 38.3 42.6 43.0 45.9 30.2Income from operations 8.1 44.0 83.7 50.4 49.2 34.1 34.5Interest expense net 0.3 0.4 (0.1) 0 0.1 0.2 0.0Taxes 5.2 15.4 26.1 17.2 14.1 11.5 10.3Net income (attributable to RSTI) 9.2 29.8 60.0 34.5 34.8 25.2 26.5EPS diluted 0.31 1.02 2.06 1.20 1.22 0.89 0.94Order entry 293.7 474.9 612.1 533.9 531.1 553.4 393.9Order backlog 87.6 138.9 153.2 147.0 118.0 141.3 157.5Weighted average s/o in million 29.2 29.2 29.1 28.7 28.4 28.2 28.3
Cash flow from operations 55.4 36.8 50.0 22.0 57.0 35.5 57.8Cash flow from investing (18.2) (8.3) (28.5) (39.4) (15.5) (24.2) (24.1)
Thereof Capex (7.8) (8.6) (21.8) (27.3) (16.2) (10.4) (28.9)Depreciation/Amortization 13.0 11.6 13.0 13.9 15.3 17.3 12.3
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*** Equity excl. minority interest
FINANCIAL METRICS – HISTORICAL OVERVIEW
KEY FIGURES (as percentage of net sales) 2009 2010 2011 2012 2013 2014 2015/9MRevenue 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%Cost of goods sold 62.2% 60.7% 61.2% 63.6% 64.9% 64.4% 62.9%Gross profit 37.8% 39.3% 38.8% 36.4% 35.1% 35.6% 37.1%Selling, general & administrative 25.4% 21.2% 18.0% 18.7% 18.2% 20.0% 19.4%Research & development 9.0% 7.1% 6.4% 7.9% 7.7% 8.7% 8.0%Income from operations 2.3% 10.4% 14.0% 9.3% 8.8% 6.4% 9.1%Interest expense / (Income) 0.1% 0.1% 0.0% 0,0% 0.0% 0.0% 0.0%Net income (attributable to RSTI) 2.6% 7.0% 10.0% 6.4% 6.2% 4.7% 7.0%
Effective Tax Rate 36.1% 34.1% 29.9% 32.8% 28.8% 31.4% 28.0%Revenue from service, training, spare parts 30% 30% 26% 28% 26% 29% 28%Revenue from components 12% 10% 10% 12% 13% 13% 15%
EBIT 4.2% 10.8% 14.4% 9.6% 8.7% 7.0% 9.7%EBITDA 7.9% 13.5% 16.6% 12.1% 11.5% 10.2% 13.0%
ROE*** 2.2% 7.2% 12.7% 7.1% 6.4% 4.7%ROWC 3.3% 10.4% 18.0% 10.8% 9.3% 6.7%
RETURN ANALYSIS 2009 2010 2011 2012 2013 2014
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STRONG BALANCE SHEET
ASSETS (in US$ thousands) 06/30/2015 09/30/2014
Topic Four
Total current assets 478,978 473,875Including:Cash, cash equivalents & short term investments 172,279 141,658Trade accounts receivable, net 86,410 108,026Inventories, net 184,328 190,321Total non-current assets 216,461 214,710Total assets 695,439 688,585
Total current liabilities 110,103 99,853Including:Short-term debt 5,230 3,255Trade accounts payable 23,869 22,702Total non-current liabilities 53,321 50,023Including:Long-term debt 18,416 11,511Net stockholders' equity 532,015 538,709Total liabilities and stockholders’ equity 695,439 688,585
Days Sales Outstanding 63 74Equity Ratio 77% 78%
LIABILITIES & STOCKHOLDERS’ EQUITY 06/30/2015 09/30/2014
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Marking Housing & SIM CardDP SSL, FL
Degating of Poly-carbonate Display
CO2 Laser
Battery Welding /Marking
FL
Surface FinishingDP SSL
Cutting of Mem/SD Card
DP SSLLithographyExcimer, DP SSL, CO2
Flat Panel/Screen Patterning
USPL, DP SSL, Excimer
Plastic Welding Diode Laser
Wafer AnnealingCO2 Laser, Diode
Laser
Welding MetalFrame
DP SSL, FL
Spot WeldingHousing
LP SSL, FL
Cutting ofSapphire Glas
FL, USPL
LASERS FOR COMMUNICATION DEVICES
Mobile & Smart Communication Devices Make Use of Different
Laser Technologies
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Packaging ProcessingLeather Processing
Cutting of Wood Glas/Acrylics Cutting
Cutting & Marking of Textiles & Other Tissues
Cutting & Marking of Paper & Adhesive Foils
Infinite applicationpossibilities for low-/medium power CO2 lasers due to their
wavelength
Vast Market for CO2 Laser Processing: Organic Materials
LASERS FOR ORGANIC MATERIALS
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Engine Ventilation Components Car Key Housings Press Taps
(Packaging Industry)SupplementaryWater Pumps
Potential for polymer welding in various industrial sectors
LASER POLYMER WELDING
By courtesy of By courtesy of Bühler Motor GmbH
Page 23
Glass processing portfolio further enhanced through the acquisition of FiLaser‘s
unique singulation technology for brittle materials like glass &
sapphire
Strong IP Portfolio for glass & sapphire processing applications
SPECIAL LASER APPLICATIONS
ROFIN‘s Existing Glass Applications Portfolio
ROFIN‘s Expanded Applica-tion Portfolio for Glass & Co.
Page 24
… at all times … for our loved ones … in communications … while having a snack
LASERS IN DAILY LIFE
… with good company …for keeping food fresh … enjoying leisure time … creating masterpieces
... and Last but not Least ...Laser applications light up our lives ...
Page 25
Standort Hamburg
Industry leader in growing industrial laser market
‒ Greatest breadth of product portfolio
‒ Largest global footprint and customer reach
‒ Leader in technological innovation and acquisition integration
Use of industrial lasers expanding significantly across multiple end markets
Clear path to enhanced profitability driven by new products, new
configurations, improving designs in fiber lasers and ultrashort pulse lasers
KEY STRATEGIC & INVESTMENT HIGHLIGHTS
Page 26
Nasdaq: since 1996 “RSTI”
Frankfurt Stock Exchange: since July 2001 ISIN: US7750431022
Indices: Russell 2000, S&P SmallCap 600
Shares O/S (diluted): ~ 28.3 million (9 M/FY2015)
Float: ~ 90%
Share distribution: ~ 80% USA, ~ 20% Europe/ROW
Fiscal year ends Sept. 30
Earnings results 4th quarter FY 2015: November 12, 2015
ROFIN-SINAR Technologies Inc. Investor Relations Contact:c/o ROFIN-SINAR Laser GmbH Katharina ManokBerzeliusstrasse 87 Tel.: +49-40-73363-425622113 Hamburg, Germany Fax: +49-40-73363-4138
email: [email protected]
Common Stock
ROFIN‘s Common Stock
THE ROFIN SHARE
Page 27
COMPANY HISTORY – MILESTONES
Appendix - Company
1975 - Founding of ROFIN-SINAR Laser 1987 - Acquired by Siemens 1988 - Acquisition of Spectra Physic’s Industrial Laser Division in the US 1989 - Acquisition of Laser-Optronic in Germany (laser marking systems) 1996 - Spun off from Siemens (IPO on Nasdaq Stock Exchange) 1997 - Acquisition of Dilas Diodenlaser, Germany 1998 - Acquisition of Palomar Technology UK (today Rofin-Sinar UK) 2000 - Acquisition of Carl Baasel Lasertechnik, Germany 2001 - Acquisition of Z-Laser S.A., Spain 2001 - Secondary listing at the Frankfurt Stock Exchange (TecDAX 2004 - 2010) 2002 - Expansion in Asia; Founded subsidiaries in Taiwan and Korea 2004 - Acquisition of Optoskand, Sweden 2004 - Secondary offering of 2.86 Mio shares at $28 2004 - Acquisition of PRC and Lee Laser, USA 2005 - Founded subsidiaries in China, Canada and USA (Dilas Diode Laser, Inc.) 2007 - Acquisition of Corelase Oy, m2k-laser GmbH, ES Technology 2008 - Acquisition of Nufern, USA (fibers and fiber laser technology) 2008 - Foundation of ROFIN-BAASEL Swiss AG 2008 - Formed Nanjing Eastern Technologies and Dilas Diodelaser China 2009 - Closed acquisition of China-based NELC 2010 - Acquired LASAG AG (Thun/Switzerland) and its worldwide activities 2011 - Formed subsidiary in India 2014 - Acquisition of FiLaser’s assets to commercialize technology
