investors meeting 9 september 2015
TRANSCRIPT
ENTER IN THE WORLD OF NANO AND MICROSYSTEMS
Investors meeting9 September 2015
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DISCLAIMER
This presentation does not contain or constitute an offer of securities for sale or an invitation or
inducement to invest in securities in France, the United States or any other jurisdiction.
This presentation may contain information expressed as forward-looking statements. Forward-looking
statements are statements that are not historical facts. Forward-looking statements may include
anticipations, projections and their underlying assumptions, statements (regarding plans, objectives,
expectations and intentions, future financial results, potential events, operations, services, products).
Such information concerns either trends or targets and cannot be regarded as results forecasts or as
any other performance indicator.
This information is by nature subject to risks and uncertainties, that may cause the actual results to
differ from those mentioned in the forward-looking statements. Even though Tronics’ management
believes that the expectations reflected as of the date of this presentation in such forward-looking
statements are reasonable, this information does not reflect the company's future performance and are
not intended to give any assurances or comfort as to future results. Therefore no-one should unduly
rely on these forward-looking statements. Tronics makes no commitment to update this information.
More comprehensive information about Tronics may be obtained on its website
(www.tronicsgroup.com).
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1 Tronics overview
2 First half 2015 results
3 Projects underway and objectives
AGENDA
Enter the world of nano and microsystems
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NANO AND MICROSYSTEMS ARE PERVADINGALL SECTORS OF ACTIVITY
Main application domains:
Smartphones, Tablets & Wearable electronics
Automotive
Life Sciences
Aeronautics
Defense
Other
Main functions:Accelerometers, gyroscopes, pressure sensors, optical components, other
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Nano and microsystems are miniaturized devices enabling sensor and/or actuator functions
Packaging
MEMS/NEMSelement
Control, digitizationand communicationelectronics
EXAMPLE OF A MICROSYSTEM: GYPRO
Mobilemicrostructure
Nano-wire
Inertial Sensors: orientation, speed and position of an object in space
Optical Microsystems: integration of miniaturized optical systems
RF Components: management of Radio-Frequency signals
BioMEMS: compact devices for biology or pharmacology analysis
Miniaturization, power savings and system cost optimization
WHAT IS THE PURPOSE OF NANO ANDMICROSYSTEMS?
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Tronics (Dallas)
Tronics (Crolles)
2 direct production sites
Listed onAlternext Paris
since February 2015
92 employeesincluding 55 engineers
and scientists
Leading customer references
2014 revenue:$20 M
15 years of R&D25 active patent
families
Distributors in Japan, China, Israel
TRONICS OVERVIEW
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A company focused on technology
A NEW PHASE OF GROWTH
Accelerated monetization of
technologyexpertise
First promising results
Becoming a major worldwide player
Development of a strong and patented technology expertise
Constitution of technology platforms
International development
One major customer (Sercel) representing more than half of total revenue
1997
Strengthened management team
Launch of new solutions and acceleration of marketing initiatives
Willingness to diversify customer portfolio
More than 85% of revenue outside of Sercel in 2014
Growth: 14% in 2014 (54% excluding Sercel)
13 new customers
Unique positioning on the most promising segments
Ambitious product roadmap
Disruptive technology: M&NEMS
2013 2014 20152012 ….
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UNIQUE POSITIONING ACROSS THEWHOLE VALUE CHAIN
From engineering … … to manufacturing
QualificationDesign and simulation
Manufacturing processes
Specifications and managementof control electronics
Tests andcharacterization
A FULL RANGE OF SERVICES WITH HIGH ADDED VALUE
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REUSABLE TECHNOLOGY BLOCKS TOACCELERATE TIME TO MARKET
CORTO: Tronics capitalizes on its leadership in high
performance inertial sensors
M&NEMS: disruptive technology developed by LETI (15 patent families)
6 patents from Tronicsat various steps of validation
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PORTFOLIO OF CUSTOMER REFERENCES
SAMPLE OF CUSTOMERS
A portfolio of close to 50 active customers
Aeronautics & Security
IndustryRepresentatives
/ DistributorsMedical
Consumer electronics
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First half 2015 results
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21%
79%Manufacturing
Engineering
Pre-sales
3 to 6 months
Concept & prototyping
9 months
Industrialization
6 to 9 months
Multi-year production
REVENUE ANALYSIS
CYCLE TIME FROM SALES TO PRODUCTION
FIRST HALF 2015 REVENUE: €4,197KBREAKDOWN BY NATURE
Manufacturing (sale of end-use products)Engineering (sale of services)
Products currently in the development phasewill generate manufacturing revenue
within the next 12-24 monthswhen they enter into production
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70%18%
12%
Europe
Asia
Americas
63%37%
Crolles
Dallas
REVENUE ANALYSIS
FIRST HALF 2015 REVENUE BREAKDOWNBY GEOGRAPHICAL AREA
FIRST HALF 2015 REVENUE BREAKDOWNBY PRODUCTION UNIT
International represented
43% of total revenue in H1 2015, versus 21% in H1 2014
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SIMPLIFIED INCOME STATEMENT
€K - IFRSH1 2015Not audited
H1 2014
Revenue 4,197 6,001
Production 6,019 7,447
Purchases consumed 1,672 2,110
External costs 1,280 1,222
Staff costs 3,470 3,266
Current operating income (1,070) 219
Financial income (22) (84)
Income before tax (1,092) 136
Income taxes (104) (35)
Share in income of associated companies
(11) (19)
Group share of net income (1,200) 79
CONSOLIDATED INCOME STATEMENT
- Gross margin at 60.2% versus 64.8% in n-1
- Gross margin integrating R&D revenue widened from 71.7% in n-1 to 72.2%
- Structural costs held stable in order to pursue the development plan
- Production volumes by a significant customer much lower than announced at the beginning of the year -Sercel: lack of revenue vs. €1.5M in n-1
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A SOUND BALANCE SHEET
Capital increase related to the IPO:€11M
Non-current assets
Other current assets
Current assets
Cash 11,377
2,091
5,063
6,264 Equity16,784
Financial debt
Other liabilities
5,007
3,004
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CASH FLOW TABLE
€K 30/06/2015 30/06/2014
Variation deriving from operations -1,756 190
Of which WCR variation -1,299 -563
Variation deriving from investments -963 -598
Variation deriving from financing 10,299 238
Variation in cash 7,600 -170
Closing cash 11,377 3,790
Projects underway and objectives
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REMINDER OF PROJECTS UNDERWAY PRESENTED AT THE IPO
˃ Accelerate business development by strengthening the Sales & Marketing staff
and the distribution networks
˃ Increase the number of active programs with existing customers
˃ Enlarge the pipeline of business opportunities
˃ Target leaders in each of the sectors addressed
1/ BUSINESS DEVELOPMENT
2/ PRODUCT RANGE DEVELOPMENT
˃ Penetrate the segment of single-use medical devices
˃ Capitalize on our leadership in inertial sensors for the aeronautics industry
˃ Reinforce the range of standard products
3/ TAKE ADVANTAGE OF ACQUISITION OPPORTUNITIES
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2 customer projects with TSV under finalization of prototyping
In progress jointly with Leti, magnetometer prototypes in Q3
Concept developed through 1 project –start in H2 2015
In progress jointly with Leti -operational prototypes in Q3
Concept developed through 1 project –start in H1 2016
Start of the conceptual phase in 2016 in order to integrate the GYPRO
Progress report:
TECHNOLOGY ROADMAP (R&D/IP)
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NEW SALES & MARKETING DIRECTOR
Very strong experience at international levelin the sector of MEMS and semiconductors
Francois Vieillard ● Sales & Marketing Director
• More than 25 years of experience in Sales & Marketing at executive positions for significant semiconductor companies such as National Semiconductor, Toshiba, Cirrus Logic
• Strong expertise in selling MEMS, software at global level
• Negotiation of large business deals (>$100M) with European, US and Japanese groups
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DEVELOPMENT OF THE MEDICAL SECTOR
ACCELERATION OF BUSINESS DEVELOPMENT IN APPLICATIONS FOR LIFE SCIENCES (BioMEMS)
- First commercial successes with major players at global level:
- Strong revenue growth on this segment in first half of 2015
(12% of total revenue, versus 2% at the end of 2014)
- Presence at the Sensors Expo conference in June 2015 at Long Beach, California
- 2 new customer programs, including one significant project with an international
player in medical devices
According to a study published by Yole in May 2015, the BioMEMS market will reach $6.6 Bn in 2020.
Accelerometers, pressure sensors and microfluidic devices will represent $800 M
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STRENGTHENING OF THE RANGE OF STANDARD INERTIAL PRODUCTS: GYROS
STRONG COMMERCIAL DEVELOPMENT OF THE GYPRO®* PRODUCT RANGE
* Miniaturized high performance inertial sensors
Commercial agreement with AVNET Israel(April 2015)
Partnership with THALES to qualify the GYPRO3300 for civil aviation
applications
November 2014 June 2015 July 2015
2 new products even better than previous versions: GYPRO2300LD and GYPRO3300
Active participation at the Paris Air Show
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TRONICS, INITIATOR OF THE “STARS” PROJECT: PROVIDE AN ACCELEROMETER BASED ON TRONICS’ PRODUCT AND TESTED IN REAL CONDITIONS
- Considerable gains in terms of cost, weight and
footprint
STRATEGIC AIM OF THE PROJECT: MARKET DEVELOPMENT OF MEMS INERTIAL SENSORS
- Reliability level enabling measurement of
acceleration in harsh environments
(aeronautics, rail transport, industrial)
- Project support by the Government and the
Rhone-Alpes region
INDUSTRIAL PARTNERS:
Pictures to scale
OTHER PARTNERS :
Current solutions
STRENGTHENING OF THE RANGE OF STANDARD INERTIAL PRODUCTS: ACCELEROMETERS
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ATTRACTIVITY OF THE M&NEMS TECHNOLOGY FOR THE INTEGRATION OF VARIOUS SENSORS
Accelero
Gyro
Compass
Pressure
Strong potential of development especially in the Asian area
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SUCCESS IN THE SECTOR OF MICROSYSTEMS
Enlargement of the pipeline of business opportunities in key segments with deals recently signed in the sectors of mobility, aeronautics, life
sciences (medical devices), watchmaking, etc.
COMMERCIAL SUCCESSES CONFIRMED THROUGH SIGNIFICANT DEVELOPMENT PROJECTS WITH:
- One of the top 5 worldwide providers of mobile solutions
- One of the major players in the sector of watchmaking
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2018 objectives
- €40 M revenue- Improvement in profitability
For 2015
- Net income: improvement expected in H2
- A solid pipeline of new businesses with key players
UNCHANGED AMBITIONS FOR 2018
The stock exchange
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28
52.42
5.48
15.43
20.49
6.24 Institutional
Founders
Other shareholders
31.88
4.95
20.96
9.180.26
12.20
3.96
10.79
5.82Institutional
Founders
Other shareholders
Public
Treasury shares
Before IPO As of 31 July 2015
CAPITAL BREAKDOWN (%)
29
TRONICS’ STOCK
Alternext Paris
IPO date: 10 February 2015
Label: TRONICS
ISIN code: FR0004175099
Mnemonic code: ALTRO
ICB classification: 9576 – Semiconductors
Introduction price: €13.20 by share
Price on 1 September 2015: €11.58 per share
Market capitalization on 1 September 2015: €38.17 M
Next release:
2015 revenue,16 February 2016
(after Alternext market close)
www.tronicsgroup.com