Analyst and Media Conference Results Fiscal Year 2011 22 March 2012
Highlights in 2011 Peter M. Wagner, Chairman of the Board of Directors
Excellent Results in a Difficult Industry Environment 59% growth in net sales; 44% organic growth MBTN reached its high targets (guidance) in net sales and EBITDA EBIT, profit for the year weakened by special items due to acquisition of Roth & Rau Environment in our industry remains difficult in 2012, recovery expected in 2013 Focussing on our strengths in 2012 Net sales MCHF 1500 1000 500 0 208 448 421 826 1315 2007 2008 2009 2010 2011 +44% organic growth +15% 200 acquisition of R&R EBITDA MCHF Note: 2008-2011 in accordance with IFRS; 2007 in accordance with Swiss GAAP FER 300 100 0 28 83 63 188 278 2007 2008 2009 2010 2011 3
Strategically Complementing Our Technologies Roth & Rau AG Invested MCHF 287.9 (cash flow) in fiscal year 2011 for the purchase of 89.17% of capital and voting rights of Roth & Rau AG (participation as of 31.12.2011) Closed previously existing «gap» between wafer and solar module Today, Meyer Burger Group is the full line system provider in photovoltaics Increasingly important to link production processes in order to further reduce Total Cost of Ownership Note: Illustration drawn from the Annual Report 2011 Roth & Rau 4
Strategic Investments in R&D and in the New Headquarters in Thun Research and Development Approximately MCHF 67.5, i.e. 5.1% of net sales invested in R&D New headquarters in Thun (MB Wafertec and MB Technology Ltd) Invested approximately MCHF 27.5 in 2011 Production / office facility for 600-700 employees, relocation starting in May 2012 Focussing on one location from currently 17 sites in and around Thun Proposal to the Annual General Meeting to change the registered office of Meyer Burger Technology Ltd to Thun 5
Passionate about PV Committed to systems and processes Peter Pauli, Chief Executive Officer
Challenges Opportunities Challenges Opportunities Fiscal political difficulties Political disputes on international levels regarding Feedin-Tarif programmes (Switzerland has made significant improvements in the past) Ongoing consolidation process in the photovoltaic market - this is also valid for Meyer Burger Unique and leading technology and system offering Full concentration / focus on technologies Demand for advanced technologies (diamond wire, heterojunction, new cell connecting technologies) New emerging markets with need for local value creation Supply existing markets with advanced and cutting edge technologies Advances in technology and initiation of replacement investment Ability to develop new markets with a very wide system offering Today Meyer Burger is the only technology group in the industry, which is influencing the market and is pro-actively providing new system offerings. 7
The Future is Now The 5th industrial revolution is here We aspire to be the leader in technology, sytem integration and the continuing reduction of process costs We know and own the most important key technologies and processes We develop technologies and systems which significantly reduce and sustainably influence our customers production costs We pursue a group-wide supply chain management system to ensure economies of scale 8
Consolidation of Sales and Service Organisations Future Footprint Taiwan, Zhubei City Singapore China, Shanghai Korea, Seoul Malaysia, Kuala Lumpur India, Pune Oregon, USA Merger Takeover Opening Note: Whether merger or takeover depends on local legal and business requirements 9
Pro-active Consolidation Process Market needs differ in their depth of their Wafer Process processes technologies products systems applications and market access The Meyer Burger Group possesses the ability and the offering for the entire industry. A strategic milestone has been reached. Cell Process Module Process 10
Focussing our Strengths: Combined Offering Processes Technologies Technology brands Wafer Cropping Bricking / Squaring Wafering Deglueing Separation Final Cleaning Inspection Cell Texturing PECVD-Coating PVD-Coating/ Anti-Reflection Coating Contact Printing Test /Sort Module Soft Touch Soldering Interconnection / Lay-up Laminating Final Assembling Perfomance Measuring Sorting Systems BIPV System Shading Roof Mounting System Free field Off grid 11
MB System Offering Flexible Market and Cluster Offering From ingot to solar module to complete BIPV energy system Cropping Bricking Squaring Wafering Cleaning Separating Inspection Texturing Coating Printing Testing Process Control Stringing Laminating Encapsulation 12
Wafer Process Key Performance Indicators (KPI) Process Control Cropping Detailled accuracy Wafering Speed Yield Surface quality Geometry FabEagle Bricking/Squaring Wafer geometry Separating/Cleaning Stress free and without breakage Spotless cleanliness Highlight: Diamond Wire Environmentally friendly Productivity doubled through a water based environmentally friendly cost efficient procedure. Inspecting 30 criteria Qualification Classification 13
Cell Process Key Performance Indicators (KPI) Texturing Surface structure Light reflection Electricity yield PECVD - Coating Emitter Electricity transmission Highlight: Heterojunction//LoBaCo Combined advantages of crystalline silicon cells and thin film technologies Increased efficiency Lower production costs PVD-Coating/ Antireflection Coating Translucence Conductivity Electricity transmission Contact Printing Test/Sort Conductors Environmentally friendly Contact printing Performance Classification 14
Module Process Key Performance Indicators (KPI) Soft Touch Soldering Productivity Soft touch soldering Electriciy flow - power Highlight: Stringing Soft Touch soldering for maximum productivity Interconnection/Lay-up Quality of connection Lifecycle Laminating / Encapsulation Material costs Lifecycle Highlight: Flashing Best-in-class performance measurement 3.5% more accurate than competitors Performance Measuring Performance Qualification Final Assembling Qualifizierung Efficient electrical connections 15
Broad System Offering Wafer Cell Module 1. Dimension: vertical integration Modul process 3. Dimension: System offering + Wafer process + Cell process Potential for wafer systems Potential for cell systems Potential for cooperation 2. Dimension: horizontal integration 16
System Offering Key Performance Indicators (KPI) Process stability: Integrated, harmonised processes Uptime / Utilisation: Optimised thoughput and production volume Simplified handling Yield / Uptime: Centralised process and service support Simplified processes 17
Learnings Market and market environment is changing fast and dramatically The next level of industrialisation in photovoltaics is in progress Political awareness and acceptance is increasing Solar energy is no longer the playground of environmentally focussed political parties only Solar energy has become an economical and sustainable key energy technology for the future Passionate about PV and committed to systems and processes 18
Focussing our Strengths Campus for Solar Technology Consolidating 17 locations in the Thun area into one centre of competence for technology 19
Focussing our Strengths Campus for Solar Technology The future solar research and development centre in Switzerland Stringing Interconnection Lay-up Laminating Lamination Final Assembly Bricking / Diamond squaring Wafering wire Cleaning Inspection 20
Financial Statements 2011 in Detail Michel Hirschi, Chief Financial Officer
Incoming Orders / Order Backlog Incoming orders FY 2011 Volume of new orders MCHF 876.8 Orders mainly received during H1 2011 MCHF 787.6 Very high demand in Asia, especially in China during H1 2011 Strong shakeout throughout the solar industry in H2 2011, customers reluctant to order new production equipment Order backlog as of 31 Dec 2011 Order backlog MCHF 909.9 (31 Dec 2010: MCHF 1,048.5) Various deliveries postponed for the time being Incoming orders MCHF 1400 1329.8 1200 1000 876.8 800 600 400 193.7 200 0 2009 2010 2011 22
Net Sales 59.2% increase in net sales (+44.0% in organic growth) Guidance for net sales 2011 reached Good order backlog from 2010 and incoming orders during H1 2011 are the main reasons for the growth Growth in nominal terms mainly in China and Germany Wafer process was the growth driver USA -40% (organic -64 %) Change in net sales by region Europe +60% (organic +39 %) Asia +68% (organic +55 %) MCHF 1400 1200 1000 Net sales 800 600 400 200 0 420.9 826.0 1315.0 2009 2010 2011 R&R MCHF 125.9 23
Split of Net Sales MCHF 1,315.0 By region 17% 3% 80% Asia USA Europe By type of sales 6% 2% 92% Machines / systems Spare parts / consumables Services By currencies 4% 2% 20% 74% CHF EUR USD Other 24
Operating Income after Costs of Products and Services Operating income after costs of products and services increased by 48.8% to MCHF 608.0 Margin declined by 3.3 percentage points compared to the previous year mainly due to Accruals on product commitments (MCHF 58.5) Depreciation / impairments of products (MCHF 12.7) Lower contribution to the margin by R&R companies Operating income after costs of products and services MCHF 49.5% % 700 46.2% 50 40.4% 608.0 600 40 500 400 300 200 100 0 170.1 408.8 2009 2010 2011 Op. Income* Margin 30 20 10 * Operating income after costs of products and services 0 25
Development of Personnel Employees Increase in personnel (FTE) + 1,300 through acquisition R&R + 215 new full-time positions Reduction in temporarily employed staff at MB companies Total 3,058 employees at year-end 2011 Personnel expenses MCHF 194.7 (2010: MCHF 133.9) Increase mainly due to Personnel expenses R&R Aug-Dec 2011 MCHF 38.6 New full-time positions Increase in other personnel expenses (recruitment, employee training, travelling expenses) No. of employees (incl. temporary staff) FTE 3500 3000 2500 2000 1500 1000 500 0 255 1276 215-212 224 1300 Employees (permanent contracts) Temporary employees 267 2791 26
EBITDA Other operating expenses Total other operating expenses MCHF 134.9 (2010: MCHF 87.4), includes MCHF 28.0 of other operating expenses by R&R Higher expenses for rent (MCHF +5.2 compared with FY 2010) Higher external R&D costs (MCHF +10.4 compared with FY 2010) Transaction expenses re R&R (MCHF 5.1) Expansion of the Group results in higher operating expenses EBITDA EBITDA margin 21.2% (without pro-rata results R&R: 23.5%) EBITDA guidance 2011 reached OPEX as a percentage of net sales was 25.1% in 2011 compared with 26.8% in 2010 EBITDA MCHF % 300 22.7% 278.4 25 250 21.2% 20 200 15.0% 187.5 15 150 10 100 63.3 50 5 0 0 2009 2010 2011 EBITDA EBITDA margin 27
EBIT Depreciation, amortisation / impairments of MCHF 161.7 in total (2010: Depreciation, amortisation of MCHF 59.7) Property, plant and equipment Depreciation, amortisation of MCHF 19.9 Intangible assets Impairment on goodwill of Roth & Rau / OTB Solar of MCHF 73.6 Impairment on R&R CTF thin-film technology of MCHF 7.0 Amortisation of intangible assets related to acquisitions in 2011 (MCHF 19.4) and acquisitions of previous years (MCHF 41.7) EBIT MCHF % 140 127.9 25 120 116.7 20 100 15.5% 80 15 60 9.8% 10 41.3 8.9% 40 5 20 0 0 2009 2010 2011 EBIT EBIT margin 28
Income Statement 2011 Effects EBITDA to Profit for the Year MCHF 300 278-62 250-19 -74 200 150-7 117-25 100 50 0-21 -34 36 29
Financial Result and Taxes Financial result Financial result, net of MCHF -21.4 (2010: MCHF -34.5) Includes foreign currency translation effects of MCHF -16.8 in financial expenses. These resulted mainly from the valuation of intercompany loans to foreign subsidiaries (which had been granted during fiscal year 2011) Taxes Income taxes amounted to MCHF 34.2 and include several one-off effects Tax rate of 48.8% for 2011 was substantially higher than the expected tax rate of 22.5% Negative tax effects in FY 2011 in an amount of MCHF 44.5 due to Expenses that are not tax-deductible (goodwill impairment R&R and OTB, fair value adjustment in investments in associated companies of R&R) Adjustment of capitalised tax loss carry-forwards at OTB Positive tax effects from tax reliefs granted to Swiss subsidiaries and tax losses at foreign subsidiaries with higher tax rates 30
Profit for the Year Profit for the year Attributable to shareholders of MBTN MCHF 40.8 Attributable to non-controlling interests MCHF -5.0 Earnings per share EPS CHF 0.86 (2010: CHF 2.18) Ø number of outstanding shares 47,355,000 (2010: 44,992,000) Cash EPS CHF 4.62 (2010: CHF 7.72) Proposal by the Board of Directors Profit for the year MCHF 0 Retained earnings to be carried forward 2009 2010 2011 Note: EPS and average number of outstanding shares on diluted basis Cash EPS = Operating cash flow / average number of outstanding shares (diluted) 120 100 80 60 40 20 29.2 97.9 35.8 31
Income Statement TCHF 2011 in % 2010 in% Net sales 1 315 039 100.0% 826 005 100.0% Other income 20 254 14 935 Income 1 335 293 849 728 Costs of products and services thirds -721 290-563 511 Changes in inventories of finished products and work in process -28 055 122 535 Capitalised services 22 078 8 788 Operating income after costs of products and services 608 026 46.2% 408 752 49.5% Personnel expenses -194 739-133 859 Other operating expenses -134 920-87 357 EBITDA 278 367 21.2% 187 535 22.7% Depreciation and amortisation -161 681-59 684 EBIT 116 686 8.9% 127 851 15.5% Financial income 4 087 3 122 Financial expenses -25 467-37 604 Result from investments in associated companies -25 298 - Earnings before taxes EBT 70 009 5.3% 93 369 11.3% Income taxes -34 184 4 580 Profit for the year 35 825 2.7% 97 949 11.9% 32
Balance Sheet Cash and cash equivalents of MCHF 260.2 Net cash position of MCHF 250.3 (interestbearing liabilities MCHF 9.9) Inventories and machines in production are reported at net value within balance sheet: directly allocable customer prepayments are deducted Increase in property, plant and equipment due to acquisition R&R and new building complex in Thun Intangible assets from acquisitions of previous years 2008-2011 55.4% equity ratio TCHF 31.12.2011 in % 31.12.2010 in% Cash and cash equivalents 260 180 393 543 Trade and other receivables 165 966 91 678 Inventories 212 005 139 028 Other current assets 3 787 314 Total current assets 641 938 46.6% 624 564 58.5% Property, plant and equipment 132 824 34 171 Investments in assoc. companies 177 - Intangible assets 540 195 395 385 Other long-term assets 62 218 12 678 Total long-term assets 735 414 53.4% 442 234 41.5% Total assets 1 377 352 100% 1 066 799 100% Current financial liabilities 1 608 582 Trade payables 65 555 77 565 Customer prepayments 229 367 231 087 Other current liabilities 190 369 63 066 Total current liabilities 486 898 35.3% 372 300 34.9% Non-current financial liabiliities 8 257 310 Other non-current liabilities 119 663 51 261 Total non-current liabilities 127 920 9.3% 51 572 4.8% Total equity incl. non-controlling interests 762 534 55.4% 642 927 60.3% Total liabilities and equity 1 377 352 100% 1 066 799 100% 33
Cash flow High operating cash flow due to positive business development and strong sales growth One-off, non-cash effects on profit for the year Slight increase in NWC mainly due to decrease in customer prepayments and increase in finished products Investment activities reflect acquisition of shares in R&R and investments in new building complex in Thun Financing activities reflect acquisition of additional shares in R&R after 9 Aug 2011 and repayment of financial liabilities Repayment of major part of debt certificates at R&R TCHF FY 2011 FY 2010 Profit for the year 35 825 97 949 Reversal of non-cash income/expenses 196 321 56 082 Change in NWC -13 388 193 489 Cash flow from operating activities 218 758 347 520 Investments in property, plant, equipment, net -56 491-13 257 Investments in intangible assets -2 372-1 256 Increase in cash from merger with 3S - 46 924 Purchase of Roth & Rau shares until 09.08.2011-261 253 - Purchase of remaining participation in Hennecke - -24 912 Other 21 2 649 Cash flow from investing activities -320 096 10 147 Capital increases (incl. premium) 8 285 3 460 Purchase of Roth & Rau shares after 09.08.2011-26 664 - Repayment of financial liabilities, net -19 480-57 018 Other -161 - Cash flow from financing activities -38 020-53 557 Cash, cash equivalents at beginning of period 393 543 96 610 Change in cash and cash equivalents -139 358 304 109 Currency translation differences on cash and cash equivalents 5 995-7 177 Cash, cash equivalents at end of period 260 180 393 543 34
Cautious Outlook for 2012 Focussing on our strengths Program to optimise and refocus Program is targeted to lower the operating cost base by MCHF 20-30 (effects mainly visible from 2013 onwards) Non-recurring expenses and accruals in CHF single-digit million are expected to be incurred in the income statement 2012 for the implementation of the program Forecasting the market development in 2012 remains difficult When will the overcapacities be eliminated and cell and module producers re-start their investment programmes? Giving guidance for 2012 is therefore extremely difficult Net sales of between MCHF 600-800 EBITDA margin of between 4-8% 35
Meyer Burger is prepared High net liquidity, available credit lines and high equity ratio Net liquidity of MCHF 250.3 Additional credit lines of MCHF 180 and MEUR 50, of which MCHF 162.6 and MEUR 29 are still available Solid balance sheet structure with comfortable equity ratio (55.4%) Priorities are set for 2012 Strict cost control Efficient management of our cash flows Business with updates (possible even without increase in capacities) Push technology developments and improvements Focus on our strengths and make use of synergies within our Group We expect demand for production equipment to increase again substantially from 2013 onwards Meyer Burger Group is well positioned with its unique technology and service portfolio to profit from the expected upturn in the market 36
We thank you for your kind attention 37
Disclaimer Information in this presentation may contain forward-looking statements, such as guidance, expectations, plans, intentions or strategies regarding the future. These forward-looking statements are subject to risks and uncertainties. The reader is cautioned that actual future results may differ from those expressed in or implied by the statements, which constitute projections of possible developments. All forward-looking statements included in this presentation are based on data available to Meyer Burger Technology Ltd as of the date that this presentation is released. The company does not undertake any obligation to update any forward-looking statements contained in this presentation as a result of new information, future events or otherwise. This presentation is not being issued in the United States of America and should not be distributed to U.S. persons or publications with a general circulation in the United States. This presentation does not constitute an offer or invitation to subscribe for, exchange or purchase any securities. In addition, the securities of Meyer Burger Technology Ltd have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and may not be offered, sold or delivered within the United States or to U.S. persons absent registration under an applicable exemption from the registration requirements of the Securities Act or any state securities laws. The information contained in this presentation does not constitute an offer of securities to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995. No prospectus offering securities to the public will be published in the United Kingdom. Persons receiving this presentation in the United Kingdom should not rely on it or act on it in any way. In addition, the presentation is not for release, distribution or publication in or into Australia, Canada or Japan or any other jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. 38