4Q.2013 Investor Conference

Transcription

1 Inotera Memories, Inc. 4Q.2013 Investor Conference Charles Kau, Chairman Scott Meikle, President Peter Shen, CFO 28 th January, 2014

2 AGENDA Highlights Financial i Review Operations & Outlook Q & A 2

3 Disclaimer i This presentation contains some forward-looking statements that are subject to substantial risks and uncertainties. Typically, these statements contain words such as anticipate, believe, could, estimate, expect, intend, plan, forecast, project, predict, potential, continue, may, should, will, and would or similar words. You should consider these forward-looking statements carefully because such statements are only our expectations or projections about future events, and actual results may differ materially from those expressed or implied by such statements. The forwardlooking statements in this presentation include, but are not limited to, growth rates for various markets estimated by third party sources, future products and technology development, widespread market acceptance of the hosted delivery model, future revenue growth and profitability. You should be cautioned that the forward-looking statements are no guarantee of our future performance. The forward- looking statements contained in this presentation are made only as of the date of this presentation and we undertake no obligation to update the forward-looking statements to reflect subsequent events or circumstances, except as required by law. This presentation and the information contained herein are the property of Inotera Memories, Inc. 3

4 HIGHLIGHTS 4

5 Y2013 Earnings Recap 1Q' Q'13 3Q'13 4Q'13* Sales Revenues (Million NT$) Net Income (Million NT$) EPS (NT$) 20, ,944 12,747 8,632 7,290 11, ,472 (0.11) -613 Y 2013* NT$ 58,993 Million Y2013* NT$ 21,200 Million Y2013* NT$ 3.66 weighted avg. outstanding shares of 5,789 million * 4Q 13 & Y2013 numbers are unaudited 5

6 Transfer Pricing 3-month rolling avg. of MU s ASP (1) Sales Revenues (Million NT$) Gross Margin (%) 20,669 Variable % of ASP (2) (based on EBITDA in the preceding quarter) 16,944 53% MU s Back-end Cost 12,747 45% 45% (3) (+/- 3%) 8,632 28% Inotera s Selling Price per wafer -3% 1Q'13 2Q'13 3Q'13 4Q'13* 1Q'14E 1Q 14E Note (1): based on current and the preceding two months starting from 1Q 14, to better match market price movements to costs occurred in delivery time. Note (2): to be adjusted up and down quarterly according to EBITDA in the preceding quarter starting from 1Q 14 as per original contract. Note (3): 1Q 14E gross margin guidance will be subject to market ASP movements from January to March, * 4Q 13 & Y2013 numbers are unaudited 6

7 FINANCIAL REVIEW 7

8 Income Statement 4Q 13* % 3Q 13 % Y2013* % (Unit: Million NT$, except for EPS in NT$) QoQ (1) YoY (1) Net Operating Revenues 20, % 16, % 22% 127% 58, % Gross Profit (Loss) Gross Margin (%) 10,902 53% 7,659 45% 42% N/M 21,908 37% Operating Income (Loss) Operating Margin (%) 10,712 52% 7,511 44% 43% N/M 21,300 36% Income (Loss) before Income Tax 11,051 7,290 52% N/M 21,200 Income Tax Benefit (Expense) 0 0 N/M N/M 0 Net Income (loss) Net Margin (%) 11,051 53% 7,290 43% 52% N/M 21,200 36% EPS (Loss) $1.82 $ % N/M 3.66 Weighted Average Outstanding Shares (million shares) 6,058 6,043 5,789 Note (1) : A positive percentage value in the columns QoQ and YoY indicates improvement in 4Q 13, while a negative value indicates the opposite. * 4Q 13 & Y2013 numbers are unaudited 8

9 Operating Expenses Research and Development Expenses (Unit: Million NT$) General and Administration Expenses (Unit: Million NT$) Q*, 99 3Q, 76 1QE, 2Q, Q, 61 ~ 200 Y2011 Y2012 Y2013* Y2014E 4Q*, 91 3Q, 73 2Q, 76 1Q, 69 1QE, Y2013* Y2014E * 4Q 13 & Y2013 numbers are unaudited 9

10 Non-Operating Income / Exp. (Unit: Million NT$) Net Non-Operating Income (Expenses) therein Interest Expenses Others 4Q 13* 3Q 13 4Q (221) (227) (295) (332) (338) FX: USD/NTD SMA, QTWD=TP, Trade Price(Last), /1/2, Q Q Q Q Q Q Q Q Q Q Source: Reuters * 4Q 13 & Y2013 numbers are unaudited 10

11 Balance Sheet & Key Indices Selected Items from Balance Sheet Dec 13* Sep 13 Dec 12 (Unit: Million NT$) Cash & Marketable Securities 15,460 9,764 2,928 Inventories 3,583 3,930 4,262 Current Assets 35,252 27,488 12,711 Net PP&E 66,802 69,282 76,452 Total Assets 102,380 97,091 89,484 Current portion of L/T Debt 13,973 13,974 11,650 Current Liabilities 39,079 40,112 50,552 L/T Debt 11,748 16,869 14,971 Total Liabilities 52,940 59,147 67,840 Total Equity 49,440 37,943 21,644 Key Indices Book Value per Share (NT$) Current Ratio (times) Debt-Equity Ratio (times) * Dec 13 numbers are unaudited 11

12 Cash Flows (Unit: Million NT$) Net Cash Provided by Operating Activities 4Q 13* 3Q 13 4Q 12 11,741 9,420 7,005 therein depreciation & amortization 3,619 3,707 7,363 Net Cash Used in Investing Activities (317) (2,001) (839) Free Cash Flow 11,424 7,419 6,166 Free Cash Flow =Net Cash Provided by Operating Activities + Net Cash Used in Investing Activities Net Cash Provided by Financing Activities (5,844) (2,098) (5,022) * 4Q 13 & Y2013 numbers are unaudited 12

13 Capital Expenditures (Booking Basis) Y2013 * Capex of NT$ 6.4 B Y2014E Capex of NT$15.0B, Including: Capex E (Unit: Billion NT$) Tools for 20nm pilot run Facility enhancement 15.0 Early prep for 20nm ramp * 2014E * 4Q 13 & Y2013 numbers are unaudited 13

14 OPERATIONS & OUTLOOK 14

15 Wafer Shipments 15

16 Bit Shipments 16

17 2013 Operational Highlights Annual bit shipments increase by 39% YoY in 2013 Annual fully-loaded bit cost reduction by 44% in 2013 Outstanding achievement in 30nm productivity Bit output of Non-PC DRAM products tripled in 2013 Growing number of products for server, mobile and consumer applications 17

18 2014 Business Outlook Board approved the equity fundraising plan of up to 450 million new common shares From 2014, 100% wafer shipments to Micron Continue to extend 30nm capability for automobile, high- end server, networking and other consumer applications 20nm pilot run & prep of volume ramp by end of

19 Thank You. Questions & Answers For More Information Please Visit Our IR Website at: 19