Brooks Automation Needham Healthcare Conference

Transcription

1 Brooks Automation Needham Healthcare Conference March 27,

2 Safe Harbor Statement Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995; certain matters in this presentation, including forecasts of future demand and future Company performance, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to materially differ, either better or worse, from those projected. Further discussions of risk factors are available in the Company s most recent SEC filings, including the annual report on Form 10-K for the fiscal year ended September 30, 2017 and any subsequent quarterly reports on Form 10-Q. The Company assumes no obligation to update the information in this presentation. Regulation G This presentation contains certain non-gaap measures which are provided to assist in an understanding of the Brooks business and its operational performance. These measures should always be considered in conjunction with the appropriate GAAP measure. Reconciliations of all non-gaap amounts to the relevant GAAP amount are provided as an attachment to this presentation. 2

3 Brooks Automation at a Glance Semiconductor Capital Equipment 79% of Revenue Fab Automation Solutions Contamination Control Solutions Cryogenic Vacuum Products Global Service Support Life Sciences Sample Management 21% of Revenue End-to-End Cold Chain Management Automated Ultra Cold Storage Products Sample Storage Consumables Sample Management Outsourced Services FY17 Revenue of $693M, +24% YoY Based in Chelmsford, MA ~2,000 employees $0.40/share annual dividend Sales in 50 countries Operations in 11 countries > 500 base patents 3 * Summary data shown as of Fiscal Year ending September 30, 2017.

4 BROOKS AUTOMATION Driving Performance. Delivering Profitable Growth. Driving performance Building on two strong platforms Inflection point for profitable growth 4

5 EXECUTION A Company on the Move to Higher Value and Higher Growth Acquisitions Life Sciences Semi Dividends Paid ~$355M ~$100M ~$153M 2013 / / 16 FluidX for $16M BioStorage Technologies for $125M 2017 / 18 BioCision add l $11M PBMMI for $34M FreezerPro software for $5M 4titude Ltd. for $66M 2011 / 12 RTS for $3M Nexus for $85M Matrical for $9M 22% of BioCision for $4M Contact for $7M 2011 In Semi market with a range of offerings Divested of Contract Manufacturing for $78M Crossing Automation for $59M Divested of Granville- Phillips instrumentation for $87M DMS for $32M 2018 In Semi and Life Sciences markets with leadership offerings 5

6 Track Record of Growth and Improving Profitability $M except EPS Revenue Earnings Per Share* $693 $1.23 $553 $560 $422 $483 $0.25 $0.45 $0.47 $0.12 FY13 FY14 FY15 FY16 FY17 FY13 FY14 FY15 FY16 FY17 And positioned for continued profitable growth 6 * Non-GAAP financial measures see reconciliation tables in the attached appendix.

7 BROOKS AUTOMATION Driving Performance. Delivering Profitable Growth. Driving performance Building on two strong platforms Inflection point for profitable growth 7

8 Building on Two Strong Platforms Life Sciences Sample Management Semiconductor Capital Equipment FY17 Revenue: $149M Q1 18 Revenue: $47M FY17 Revenue: $544M Q1 18 Revenue: $142M Core Competencies Robotic automation Cryogenics 8

9 Building on Two Strong Platforms Life Sciences Sample Management Today s Samples Highly Strategic Assets Critical to Speed of Research FY17 Revenue: $149M Q1 18 Revenue: $47M Information Rich Core Competencies Robotic automation Cryogenics 9

10 Science Demands Continuous Care of the Sample Collect Research and Analyze Identify Transport Process/ Freeze Track and Store Cold Chain of Custody 10

11 Life Sciences Offerings Proven Success and Market Leadership $M +38% $149 Automation Infrastructure Storage Services $108 Infrastructure Services Consumables & Instruments Informatics FY16 FY17 Organic growth = 27% The Leader in Comprehensive Sample Management 11

12 Momentum of Growth $M Revenue $32 $33 $35 $29 $27 $21 $48-50 $44 $47 $ Growth and Momentum Revenue +38% Organic +27% Bookings +30% Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Operating Profit* Forecast Op Profit Increase of $11M 2018 Progress Continues >30% Growth Expected $(4) $(2) $0 $1 $1 $2 $2 $2 $1 Q4 10% Operating Profit Target Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 12 * Non-GAAP financial measures see reconciliation tables in the attached appendix.

13 Life Sciences Growth Business Model with Strong Foundation of Recurring Revenue $M $240 $149 >30% Systems / Instruments / Genomics $108 Services / Consumables $43 $63 $68 53% 42% Guidance Target Acquisitions will be Additional to the Target 13

14 Clients Are the World s Premier Healthcare Organizations Pharmaceutical / Biotech 14 Healthcare / BioBanks Academic / Gov t

15 Building on Two Strong Platforms Today s Semiconductor Manufacturing Semiconductor Capital Equipment Vacuum Environments Engineering for Precision & Throughput Efficiencies Contaminant Free Yields FY17 Revenue: $544M Q1 18 Revenue: $142M Core Competencies Robotic automation Cryogenics 15

16 BROOKS SEMICONDUCTOR SOLUTIONS OFFERINGS Proven Success and Market Leadership $M +20% $544 #1 Vacuum Automation #1 Contamination Control $452 #1 Cryogenic Pumping and Cooling Trusted Global Service Platform FY16 FY17 Organic growth = 20% Enabling a Process Advantage 16

17 Semi Growth Portfolio Transformed and Biased for Growth $M +20% $ % CAGR $560-$630 $379 +6% CAGR $ % 0-5% Stable Leadership Atmos Dstn / IP Cryopumps Service / Other Auto Column2 +39% +4-12% Tech Column1 Drivers Wafer-Level Packaging Contamination Control Deposition & Etch FY13 FY16 FY17 FY19 FY19 Modeled for a Modest Semi Cycle Brooks Automation, Inc. Proprietary Information

18 Semi Revenue Growth Extending Leadership Positions in Current Technology Trends $M $99 $109 $118 $126 $127 Semi Revenue $135 $145 $138 Stable Leadership CY17 +15% Growth (+21% Excl ATM / IP) $142 Overall Growth CY17 +17% Growth (+23% Excl ATM / IP) Stable Leadership Atmos Dstn / IP Cryopumps Service / Other Auto Other?? Tech Column1 Drivers Contamination Control Wafer-Level Packaging Deposition & Etch Tech Drivers CY17 +18% Growth Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 18

19 More than 50% of Revenue in High Growth Applications Deposition & Etch Advanced Packaging Contamination Control TEL NEXX, Inc. Expanding Applications and Customer Base 19

20 BROOKS AUTOMATION Driving Performance. Delivering Profitable Growth. Driving performance Building on two strong platforms Inflection point for profitable growth 20

21 Strategy Going Forward 1 Extend leadership in core markets Advance the rapid growth of Life Sciences with 2 organic and acquisition investments 3 Drive margin expansion Utilize balanced and disciplined capital 4 deployment 21

22 2019 Target Model Semiconductor Drivers Product revenue growth 2-4 percentage points faster than WFE rate Gross margin expansion to 41% Operating expense productivity Life Sciences Drivers Revenue growth to $240M Gross margin of 42-44% Operating expense productivity 16-19% Operating Margins ~70% of Brooks revenue >15% Operating Margins ~30% of Brooks revenue Operating Margins in high teens ROIC >13% 22

23 2019 Target Model $M FY 2013 FY 2015 FY 2017 FY 2019 Total Revenue Semi Life Sciences % of total $422M $379M $43M 10% $553M $485M $68M 12% $693M $544M $149M 21% $800-$870M $560-$630M $240M ~30% Gross Margin* 33.5% 35.4% 39.2% ~41% Operating Expenses* % of Revenue $136M 32.2% $159M 28.8% $179M 25.8% $190-$200M ~24% Operating Income* % of Revenue $5M 1.2% $37M 6.7% $93M 13.5% $ M ~18% EBITDA* EPS* $29M $0.12 $64M $0.45 $131M $1.23 $170-$200M $1.50-$1.80 ** Excludes the impact of future acquisitions. 23 * Non-GAAP financial measures see reconciliation tables in the attached appendix.

24 Balanced and Disciplined Capital Deployment Disciplined Capital Deployment Over last five fiscal years, >$700M of capital deployed to enhance shareholder returns Organic Growth Acquisitions Shareholder Return $300M 42% Invest in R&D, ~$50M annually ~$10M+ CAPEX annually $288M 40% Semiconductor and Life Sciences Divestitures of $85M ROIC focus $127M 18% Quarterly dividend of $0.10 per share Note: Figures referenced represent the period from FY13 through FY17. 24

25 Acquisition Priorities Focus: Life Science Expansion Storage Services, Informatics Expanding Cold Chain Capability Semi will be Opportunistic Criteria: ROIC hurdles 25

26 Guidance Q2 18 $M except EPS Q2 17 Q3 17 Q4 17 Q1 18 Guidance Mar Q2 18 Brooks Revenue Adj. Gross Margin* $ % $ % $ % $ % $ ~41% Adjusted EBITDA* Op Cash Flow $31 $25 $37 $18 $37 $35 $36 $3 $39-$46 Non-GAAP EPS* $0.28 $0.36 $0.35 $0.32 $0.33-$0.41 Dividends Per Share Returned to Shareholders $0.10 $0.10 $0.10 $0.10 $0.10** ** The Board of Directors has approved a dividend of $0.10 per share payable on March 23, 2018 to stockholders of record on March 2, * Non-GAAP financial measures see reconciliation tables in the attached appendix.

27 IN SUMMARY Driving Performance. Delivering Profitable Growth. Improving Financial Performance Attractive Long Term Financial Model Track Record of Effective Capital Deployment Revenue growth Margin expansion EPS acceleration Semi margin leverage and productivity Life Sciences high growth Internal investment Successful acquisitions Capital to shareholders Life Sciences Semiconductors 27

28 28 GAAP to Non-GAAP Reconciliations

29 Non-GAAP Operating Performance Consolidated $ millions FY13 FY14 FY15 FY16 FY17 Revenue Gross profit* Gross profit margin* 33.5 % 36.2 % 35.4 % 36.2 % 39.2 % R&D expenses SG&A expenses* Operating income * Operating margin* 1.2 % 4.2 % 6.6 % 6.4 % 13.5 % Other income (expense) (0) (1) Tax benefit (provision)* (2) (5) (10) (5) (15) JV earnings (losses)* Net income* Net income margin* 1.8 % 3.6 % 5.5 % 5.8 % 12.6 % Diluted Non-GAAP EPS - Continuing Ops* Diluted GAAP EPS - Continuing Ops (0.11) (1.01) 0.89 Adjusted EBITDA* * Non-GAAP financial measures see reconciliation tables within this appendix and 2014 results shown on continuing operations basis.

30 Non-GAAP Segment Operating Performance Brooks Semiconductor Solutions $ millions FY13 FY14 FY15 FY16 FY17 Revenue Gross profit* Gross profit margin* 32.5 % 35.5 % 36.2 % 35.9 % 39.6 % Operating expenses Operating income * Operating margin* 4.1 % 6.7 % 11.1 % 9.1 % 16.4 % Brooks Life Science Systems $ millions FY13 FY14 FY15 FY16 FY17 Revenue Gross profit* Gross profit margin* 42.2 % 41.1 % 29.8 % 37.5 % 38.0 % Operating expenses Operating income * (8) (6) (17) (5) 7 Operating margin* (19.1)% (9.4)% (25.0)% (4.6)% 4.4 % 30 * Non-GAAP financial measures see reconciliation tables within this appendix and 2014 results shown on continuing operations basis.

31 FY13 GAAP to Non-GAAP Reconciliation Consolidated $ millions, except EPS GAAP Acquisition- Related Costs Amortization Expense Restructuring Charges Impairment Charges Gain from Asset Disposal Non-GAAP Revenue Gross profit Gross profit margin 31.3% 33.5% Research and development (46.2) (46.2) Selling, general and administrative (96.5) (89.8) Restructuring charges (6.4) Operating profit (16.8) Operating profit margin (4.0%) 1.3% Interest income, net Other income, net (1.0) 0.2 Income tax benefit (provision) 5.0 (1.1) (3.0) (1.8) (0.7) 0.4 (1.2) JV and noncontrolling interests Net Income (7.2) (0.7) 7.7 Diluted earnings per share (0.11) (0.01) shown on continuing operations basis.

32 FY14 GAAP to Non-GAAP Reconciliation Consolidated $ millions, except EPS GAAP Acquisition- Related Costs Amortization Expense Restructuring Charges Impairment Charges Non-GAAP Revenue Gross profit Gross profit margin 34.7% 36.2% Research and development (52.6) (52.6) Selling, general and administrative (111.1) (101.6) Restructuring charges (6.3) Operating profit (2.7) Operating profit margin (0.6%) 4.2% Interest income, net Other income, net Income tax benefit (provision) 2.0 (0.8) (3.5) (2.1) (1.1) (5.4) JV and noncontrolling interests Net Income Diluted earnings per share shown on continuing operations basis.

33 FY15 GAAP to Non-GAAP Reconciliation Consolidated $ millions, except EPS GAAP Acquisition- Related Costs Amortization Expense Restructuring Charges JV Liquidation Asset Held for Sale Non-GAAP Revenue Gross profit Gross profit margin 34.2% 35.4% Research and development (52.2) (52.2) Selling, general and administrative (115.3) (106.9) Restructuring charges (4.7) Operating profit Operating profit margin 3.1% 6.6% Interest income, net Other income, net Income tax benefit (provision) (3.4) (0.4) (4.0) (1.5) - (0.5) (9.7) JV and noncontrolling interests (0.2) Net Income Diluted earnings per share

34 FY16 GAAP to Non-GAAP Reconciliation Consolidated $ millions, except EPS GAAP Acquisition- Related Costs Amortization Expense Restructuring Charges Tax Valuation Reversal Other Special Charges Non-GAAP Revenue Gross profit Gross profit margin 35.4% 36.2% Research and development (51.5) (51.5) Selling, general and administrative (130.3) (115.3) Restructuring charges (12.0) Operating profit Operating profit margin 0.8% 6.4% Interest income, net Other income, net (0.6) (0.6) Income tax benefit (provision) (75.8) (0.8) (4.9) (3.0) 79.3 (0.3) (5.5) JV and noncontrolling interests Net Income (69.5) Diluted earnings per share (1.01)

35 FY17 GAAP to Non-GAAP Reconciliation Consolidated $ millions, except EPS GAAP Merger and Aquistion Costs Amortization Expense Restructuring Charges Other Special Charges Non-GAAP Revenue Gross profit Gross profit margin 38.6% 39.2% Operating Expenses (200.1) (178.5) Restructuring charges (3.2) Operating profit Operating profit margin 9.3% 13.5% Interest income, net Other income (expense), net (1.8) (0.6) Income tax provision (12.1) (1.0) (1.9) (0.3) 0.1 (15.3) JV and noncontrolling interests Net Income (1.5) 87.0 Diluted earnings per share (0.02)

36 Q1 17 GAAP to Non-GAAP Reconciliations Consolidated $ millions, except EPS GAAP Acquisition- Related Costs Amortization Expense Q1 FY17 Restructuring Charges Other Special Charges Non-GAAP Revenue Gross profit Gross profit margin 35.6% 36.3% Operating Expenses (42.8) (39.5) Restructuring charges (1.0) Operating profit Operating profit margin 8.2% 11.6% Interest income, net (0.0) (0.0) Other income, net (1.8) (0.3) Income tax benefit (provision) (2.8) (0.0) (0.3) (0.1) 0.1 (3.1) JV and noncontrolling interests Net Income (1.5) 17.3 Diluted earnings per share (0.02)

37 Q2 17 GAAP to Non-GAAP Reconciliations Consolidated $ millions, except EPS GAAP Merger and Aquistion Costs Amortization Expense Q2 FY17 Restructuring Charges Other Special (Gains) Charges Non-GAAP Revenue Gross profit Gross profit margin 38.1% 39.0% Operating Expenses (48.9) (44.6) Restructuring charges (0.9) Operating profit Operating profit margin 8.7% 12.6% Interest income, net Other income, net (0.3) (0.3) Income tax benefit (provision) (3.4) (0.1) (0.5) (0.1) - (4.1) JV and noncontrolling interests Net Income Diluted earnings per share

38 Q3 17 and Q4 17 GAAP to Non-GAAP Reconciliations Consolidated $ millions, except EPS GAAP Q3 FY17 Merger and Aquistion Costs Q3'17 Amortization Expense Restructuring Charges Non-GAAP Q3 FY17 GAAP Q4 FY17 Merger and Aquistion Costs Q4'17 Amortization Expense Restructuring Charges Non-GAAP Q4 FY17 Revenue Gross profit Gross profit margin 39.4% 40.0% 40.9% 41.3% Operating Expenses (52.0) (45.0) (56.4) (49.4) Restructuring charges (0.8) (0.6) Operating profit Operating profit margin 10.3% 15.2% 9.6% 14.2% Interest income, net (0.1) (0.1) Other income (expense), net (0.3) (0.3) Income tax provision (3.7) (0.4) (0.4) (0.1) (4.6) (2.2) (0.5) (0.7) (0.1) (3.5) JV and noncontrolling interests Net Income Diluted earnings per share

39 GAAP to Non-GAAP Reconciliation Quarterly EBITDA and Adjusted EBITDA $ millions Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Net income attributable to Brooks Non-GAAP adjustments: Interest income (0.1) (0.2) (0.1) (0.0) (0.1) Interest expense Income tax provision Depreciation Amortization of intangible assets EBITDA Purchase accounting impact on inventory and contracts acquired Stock-based compensation Restructuring charges Merger and acquisition costs/ Other (1.4) Adjusted EBITDA

40 GAAP to Non-GAAP Reconciliation Annual EBITDA and Adjusted EBITDA $ millions FY13 FY14 FY15 FY16 FY17 Net income (loss) attributable to Brooks (2.2) (69.5) 62.6 Non-GAAP adjustments: Interest income (1.0) (1.0) (0.9) (0.5) (0.5) Interest expense Income tax provision (5.0) (2.0) Depreciation Amortization of intangible assets EBITDA Purchase accounting impact on inventory and contracts acquired Stock-based compensation Restructuring charges Merger and acquisition costs / Other Adjusted EBITDA

41 FY13 FY17 GAAP to Non-GAAP Reconciliation Semiconductor Solutions Brooks Semiconductor Solutions $ millions FY13 FY14 FY15 FY16 FY17 GAAP gross profit Non-GAAP adjustments: Amortization of intangible assets Impairment of completed technology intangible assets Inventory write-downs related to restructuring programs Purchase accounting impact on inventory and contracts acquired Non-GAAP gross profit Operating expenses Non-GAAP operating profit

42 FY13 FY17 GAAP to Non-GAAP Reconciliation Life Science Systems Brooks Life Science Systems $ millions FY13 FY14 FY15 FY16 FY17 GAAP gross profit Non-GAAP adjustments: Amortization of intangible assets Impairment of completed technology intangible assets Inventory write-downs related to restructuring programs Purchase accounting impact on inventory and contracts acquired Non-GAAP gross profit Operating expenses Non-GAAP operating profit (8.3) (5.9) (17.0) (5.0)

43 FY16 FY17 GAAP to Non-GAAP Reconciliation Quarterly BLSS Brooks Life Science Systems $ millions Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP gross profit Non-GAAP adjustments: Amortization of intangible assets Purchase accounting impact on inventory and contracts acquired Non-GAAP gross profit Operating expenses Non-GAAP operating profit (4.2) (1.9) (0.4)

44 GAAP to Non-GAAP Reconciliation Quarterly Operating Performance $ millions, except EPS GAAP Q4 FY17 Merger and Acquisition Costs Q4 FY17 Amortization Expense Restructuring Charges Non-GAAP Q4 FY17 GAAP Q1 FY18 Merger and Acquisition Costs Q1 FY18 Amortization Expense Tax Reform Non-GAAP Q1 FY18 Revenue Gross profit Gross profit margin 40.9% 41.3% 39.7% 40.8% Operating Expenses (56.4) (49.4) (54.4) (49.2) Restructuring charges (0.6) Operating profit Operating profit margin 9.6% 14.2% 11.0% 14.8% Interest expense, net (0.1) (0.1) (2.0) (2.0) Other income (expense), net (1.7) (1.7) Income tax expense (2.2) (0.5) (0.7) (0.1) (3.5) (2.8) (0.3) (0.3) (0.7) (4.1) JV and noncontrolling interests Net Income (0.7) 22.5 Diluted earnings per share (0.01)

45 GAAP to Non-GAAP Reconciliation Quarterly Segment Gross Profit and Operating Profit $ millions, except EPS Q4 FY17 Q1 FY18 GAAP Q4 FY17 Merger and Acquisition Costs Amortization Expense Restructuring Charges Non-GAAP Q4 FY17 GAAP Q1 FY18 Merger and Acquisition Costs Amortization Expense Restructuring Charges Non-GAAP Q1 FY18 BSSG Revenue Gross profit Gross profit margin 41.9% 42.3% 41.9% 42.3% Operating expenses (34.6) (34.6) (33.1) (33.1) Operating profit Operating profit margin 16.8% 17.2% 18.6% 19.0% BLS Revenue Gross profit Gross profit margin 37.7% 38.2% 33.2% 36.5% Operating expenses (14.4) (14.4) (15.9) (15.9) Operating profit (loss) (0.1) Operating profit margin 4.9% 5.3% (0.3%) 2.9% Unallocated Corporate Revenue Gross profit Gross profit margin Operating expenses (7.9) (0.3) (5.4) (0.2) Operating (loss) profit (7.9) (0.3) (5.4) (0.2) Brooks Consolidated Revenue Gross profit Gross profit margin 40.9% 41.3% 39.7% 40.8% Operating expenses (57.0) (49.4) (54.4) (49.2) Operating profit Operating profit margin 9.6% 14.2% 11.0% 14.8% 45

46 Brooks Semiconductor Offering Examples MagnaTran 7 BiSymmetrik Marathon Express Jet Atmospheric Transport System M2 Reticle Changers M800 FOUP Cleaner M1900 Reticle Stockers 46

47 Brooks Life Sciences Offerings BioStore II BioStore III Cryo BioStorage Services 47 Cool Lab Workflow Products 4titude Consumables FluidX Consumables