The Role of Engineering Tools in the Rise of Smart Connected Products

Changes, Implications & Insights

Blue Ocean Equities Technology Conference 2016

5 April, Sydney

2

Future performance - Forward looking statements, opinions and estimates

provided in this presentation are based on assumptions and contingencies

which are subject to change without notice, as are statements about market

and industry trends, which are based on interpretations of current market

conditions. Forward looking statements including projections, guidance on

future earnings and estimates are provided as a general guide only and

should not be relied upon as an indication or guarantee of future

performance. An investment in Altium shares is subject to investment and

other known and unknown risks, some of which are beyond the control of

Altium Limited. No representation or warranty, express or implied, is made

as to the fairness, accuracy, completeness or correctness of the information,

opinions and conclusions contained in this presentation. To the maximum

extent permitted by law, none of Altium employees, its directors, employees

or agents, nor any other person accepts any liability, including, without

limitation, any liability arising out of fault or negligence, for any loss arising

from the use of the information contained in this presentation. In particular,

no representation or warranty, express or implied is given as to the accuracy,

completeness or correctness, likelihood of achievement or reasonableness of

any forecasts, prospects or returns contained in this Presentation nor is any

obligation assumed to update such information. Such forecasts, prospects or

returns are by their nature subject to significant uncertainties and

contingencies. Before making an investment decision, you should consider,

with or without the assistance of a financial adviser, whether an investment is

appropriate in light of your particular investment needs, objectives and

financial circumstances.

Financial dataAll dollar values are in US dollars (US$) unless as otherwise presented.

Disclaimer

This presentation has been prepared by Altium Limited (ACN 009 568 772)

and is for information purposes only. It does not constitute financial product

or investment advice or a recommendation to acquire Altium shares and

has been prepared without taking into account the objectives, financial

situation or needs of individuals. Before making an investment decision

prospective investors should consider the appropriateness of the

information having regard to their own objectives, financial situation and

needs and seek legal and taxation advice appropriate to their jurisdiction.

Altium is not licensed to provide financial product advice in respect of Altium

shares.

Altium, Altium Designer, Altium Vault, Ciiva, Circuitmaker, Circuistudio,

Octopart, PCBWorks, Protel and Tasking, and their respective logos, are

trademarks or registered trademarks of Altium Limited, or its subsidiaries.

All other registered or unregistered trademarks mentioned in this

presentation are the property of their respective owners, and no trademark

rights to the same are claimed

Agenda

2 Internet of Things (IOT) & Engineering Tools

3 The Future of the Electronic Design Automation (EDA) Industry

4 Altium is Well Positioned to Emerge as a Leader

1 Introduction to Altium

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2

2011 2012 2013 2014 2015 2016 2017

4

Sustained Growth & Profitability - Altium’s Financial Metrics

50M

40M

30M

20M

Sales

$100M

> 30%EBITDA

Expense

Revenue

$42.6M Revenue (up 13% pcp)

$46.4MCash

$9.1M NPAT

(up 35% pcp)

7.12EPS

(up 26%)

13%CAGR

29,300 Subscribers(42% of Revenue)

Debt Free

$41.1M Sales (up 22% pcp)

AU10c Dividend(up 25% pcp)

$10.7MEBITDA

(up 6% pcp)

EBIT Margin 23% (down from 26%) *

Altium’s H1 FY16 Financial Metrics

* Includes revenue and costs from acquisitions

5

Altium's Journey - a Long History and a Promising Future

2010

1985

1991

1999

The company was founded by creating the first version of Altium Designer, Protel PCB

Altium Launches Protel for Windows - World's first Microsoft Windows-based PCB design system

Altium Successfully completes an IPO on Australian Stock Exchange

2006

Altium launches Altium Designer 6, the world’s first Native 3D PCB design software

Altium launches Altium Designer 13 introducing DXP 2.0, its next generation integration platform opening up Altium Designer to third-party developers

Altium partners with Dassault Systemes SOLIDWORKS to Deliver a

specialized version of its PCB Design Software for SolidWorks users

Now

Successful Capital Raising of 44M on ASX

6

Printed Circuit Board Design and Manufacturing Process

PCB FabricationPCB Design PCB AssemblyCircuit Design

Design Capture Physical Layout Fabrication Assembly

7

Altium Products

Electronic Design

Design Data Management & Collaboration Software

Embedded Software Development Tools

3D Printed Circuit Board Design Software Solution

Vault

8

Diversity of Applications

Automotive

Electronics &High-Tech

Life SciencesAerospace & Defence

Consumer-Electronics

SemiconductorsIndustrial Controls Automation

Research & Education

Mobile Devices & Communications

Computers

9

Market Segmentation & Altium’s Product Offering

High-End Tools - large engineering teams designing complex products

Low-End Tools - simple designs carried out by multi-skilled engineers

Mainstream Tools - moderate to high design complexity, carried out by small teams of specialist engineers

ATINA

X2

16

10

Altium’s Strategy for Market Leadership

Closing Advanced Capability Gaps in High-end PCB Design

Maintaining Leadership in Large-scale Transactional Sales

Delivering the Next Generation Enterprise Solution with Agility

Well Executed M&A Strategy and Partnership

Leveraged Sales and a Multi-Product, Multi-Channel Strategy

7

1

2

3

45

6

Web-based Collaboration & Smart Workflow

Monetization Through Smart Delivery of Content

11

The Altium Advantage

Aligned Leadership Customer Centricity

Core Strengths

Competitive Advantages

Enterprising Spirit

Altium’s Secret Sauce

Agenda

2 Internet of Things (IOT) & Engineering Tools

3 The Future of the Electronic Design Automation (EDA) Industry

4 Altium is Well Positioned to Emerge as a Leader

1 Introduction to Altium

13

Mega Trends

Information is IndexedSearch & Discovery1990’sWeb 1.0

Social Networking2000’s

Web 2.0

People are Networked

Internet of Things2010’sWeb 3.0

Web 2.0

Things are Connected and Intelligent

14

At the Heart of All Intelligent Systems is Electronics

Printed Circuit Boards Central to Electronics

Designing Smart Connected ProductsDesigning Smart Connected Products

Cloud System EngineeringCloud application development and Infrastructure management

Development of Control Systems in Electromechanical devices

Embedded System Engineering

Creation of high-performance electronic hardware with complex form factor

Electronics Engineering

Mechanical EngineeringDesigning complex objects with sophisticated electromechanical behaviour

Electrical EngineeringDevelopment of wire harness and electrical systems in Electromechanical devices

The Future is Multidisciplinary…

16

Current Generation of Engineering Tools Fall Short

The current model for tool integration is old and has evolved around the notion of “tool-chains”

CA

M

CA

E

PLM

MCAD - Mechanical Computer Aided Design

ECAD - Electronic Computer Aided Design

CAE - Computer Aided Engineering - Analysis and Simulation

CAM - Computer Aided Manufacturing

PLM - Product Lifecycle Management

17

Gartner’s New Technology Adoption Curve for IOT

TECHNOLOGY TRIGGER

PEAK OF INFLATED

EXPECTATIONS

TROUGH OF DISILLUSIONMENT

SLOPE OF ENLIGHTENMENT

PLATEAU OF PRODUCTIVITY

Gartner's 2015 Hype Cycle for IOT (5-10 years)

Internet of Things

• Benefits better understood

• New methodologies developed

• Best Practices identified

• Startups formed• Early adopters found• First generation

products produced

• Next generation products are produced

• Mainstream adoption

• Unfulfilled promises

• Only a few successes

• Scores of failure

Next Generation Engineering Tools

18

Intelligent Tools are Needed to Build Intelligent Products

System Engineering is at the heart of building intelligent products

• learn from experience

• search for knowledge intelligently

• enable collaboration

• operate at a higher level of abstraction

• be context-aware

• minimize chances of errors

Future engineering tools will:

Agenda

2 Internet of Things (IOT) & Engineering Tools

3 The Future of the Electronic Design Automation (EDA) Industry

4 Altium is Well Positioned to Emerge as a Leader

1 Introduction to Altium

20

EDA Industry is at a Crossroad

Chip Design

System DesignEDA

21

Financial Strategy Will Determine Success

Support of the

investment community

is fundamental to

success

There will be a shake-up

within the engineering

software industry

Those who “win the war”

are financed the best!

Agenda

2 Internet of Things (IOT) & Engineering Tools

3 The Future of the Electronic Design Automation (EDA) Industry

4 Altium is Well Positioned to Emerge as a Leader

1 Introduction to Altium

23

Altium’s Roadmap to Transformation

2015 2017 2020 2025

Strong Strategy, Strong Balance

Sheet & Revenue Momentum

$100 MillionRevenue & Further

Acquisitions

PCB Market Leadership

at $150 Million PCB Revenue

Emerging as a Global Leader in System

Design Automation

Thank you