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Asetek A/S

Quarterly Report Apr 29, 2015

6301_rns_2015-04-29_a358f52e-b5da-4235-a577-601ebcbd6e6e.pdf

Quarterly Report

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FirstQuarter 2015

PublishedApril 29, 2015

Disclaimer

This presentation and its enclosures and appendices (jointly referred to as the "Presentation") has been produced by Asetek A/S (the "Company") and has been furnished to a limited audience (the "Recipient[s]")on a confidential basis in connection with a potential securities issue by the Company. The content of this Presentation is not to be construed as legal, business, investment or tax advice, and has not been reviewed by any regulatory authority. Each Recipient should consult with its own legal, business, investment and tax adviser as to legal, business, investment and tax advice. The information cannot standalone but must be seen in conjunction with the oral presentation and are expressed only as of the date hereof.

The Presentation may include certain statements, estimates and projections with respect to the business of the Company and its anticipated performance, the market and the competitors. However, no representations or warranties, expressed or implied, are made by the Company, its advisors or any of their respective group companies or such person's officers or employees as to the accuracy or completeness of the information contained herein and such statements or estimates, no reliance should be placed on any information, including projections, estimates, targets and opinions contained herein, and no liability whatsoever is accepted by the Company as to any errors, omissions or misstatements contained herein. The information contained herein is subject to change, completion, or amendment without notice and the Company does not assume any obligation to update or correct the information included in this Presentation. Neither the delivery of this presentation nor any further discussions by the Company or any if its advisors with any of the Recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date of thePresentation.

This presentation may contain certain forward‐looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward‐looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", "will", "should", "may", "continue" and similar expressions. Forward‐looking statements include statements regarding: objectives, goals, strategies, outlook and growth prospects; future plans, events or performance and potential for future growth; liquidity, capital resources and capital expenditures; profit; margin, return on capital, cost or dividend targets; economic outlook and industry trends; developments of the Company's markets; the impact of regulatory initiatives; and the strength of the Company's competitors. The forward‐looking statements contained in this presentation, including assumptions, opinions and views of the Company, are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in the Company's records and other data available from third party sources. Although the Company believes that these assumptions were reasonable when made, the statements provided in this presentation are solely opinions and forecasts which are uncertain and subject to risks, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. A multitude of factors can cause actual results to differ significantly from any anticipated development expressed or implied in this document. No representation is made that any of these forward‐looking statements or forecasts will come to pass or that any forecast result will be achieved and you are cautioned not to place any undue reliance on any forward‐looking statement. he distribution of this Presentation and the offering, subscription, purchase or sale of securities issued by the Company in certain jurisdictions is restricted by law. Persons into whose possession this Presentation may come are required by the Company to inform themselves about and to comply with all applicable laws and regulations in force in any jurisdiction in or from which it invests or receives or possesses this Presentation and must obtain any consent, approval or permission required under the laws and regulations in force in such jurisdiction, and the Company shall not have any responsibility or liability for these obligations. In particular, neither this presentation nor any copy of it may be taken or transmitted or distributed, directly or indirectly, into Australia, Canada, Hong Kong, Japan, Switzerland, United Kingdom or the United States unless pursuant to available exemptions from registration requirements.

In relation to the United States and U.S. persons, this Presentation is strictly confidential and is being furnished solely in reliance on applicable exemptions from the registration requirements under the U.S. Securities Act of 1933, as amended. The shares of the Company have not and will not be registered under the U.S. Securities Act or any state securities laws, and may not be offered or sold within the United States, or to or for the account or benefit of U.S. persons, unless an exemption from the registration requirements of the U.S. Securities Act is available. Accordingly, any offer or sale of shares in the Company will only be offered or sold (i) within the United States, or to or for the account or benefit of U.S. persons, only to qualified institutional buyers ("QIBs") in private placement transactions not involving a public offering and (ii) outside the United States in offshore transactions in accordance with Regulation S. Any purchaser of shares in the United States, or to or for the account of U.S. persons, will be deemed to have made certain representations and acknowledgements, including without limitation that the purchaser is a QIB. This Presentation and its contents are confidential and its distribution (which term shall include any form of communication) is restricted pursuant to section 21 (restrictions on financial promotion) of the Financial Services and Markets Act 2000 (as amended). In relation to the United Kingdom, this Presentation is only directed at, and may only be distributed to, persons who fall within the meaning of article 19 (investment professionals) and 49 (high net worth companies, unincorporated associations, etc.) of the Financial Services and Markets Act 2000 (financial promotion) Order 2001 (as amended) or who are persons to whom the document may otherwise lawfully be distributed. This Presentationmay only be distributed in circumstances which do not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995 (as amended).

The contents of this Presentation shall not be construed as legal, business or tax advice. Each reader of this Presentation should consult its own legal, business or tax advisor as to legal, business or tax advice. Ifyou are in doubt about the contents of this Presentation, you should consult your stockbroker, bank manager, lawyer, accountant or other professional adviser.

This Presentationis subject to Danish law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of the Danish courts.

WebPresentation

Presentation by: André S. EriksenCEO & Founder Peter D. MadsenCFO

[email protected]

I. Operations

  • II. Financials
  • III. Summary and outlook
  • IV. Q&A session

Awarded first production order under Fujitsu OEMagreement

OEM agreement and production order validates data center strategy pursued since 2012

  • • Fujitsu to incorporate RackCDU liquid cooling in its High Performance Computing product line
  • •Fujitsu will rollout RackCDU globally as part of the agreement
  • • Asetek's first design win with a global top 5 server OEM, the second agreement in total
  • • Asetekproducts will be sold under Fujitsu's brand and channel
  • •First Fujitsu product launch based on RackCDU expected in Q3 2015

AsetekRackCDU D2C™

RackCDUProduction Order impact

  • • Largest single order Asetek has received so far on its RackCDUproducts
  • • Value in excess of USD550K
  • •Approximately 40 racks worth of cooling
  • • Delivery and revenue is currently scheduled for Q2 2015

Awarded\$3.5m CEC project

Liquid Cooling

• Asetek Selected for \$3.5M USD Project for Two Major California Energy Commission to be completed over 24 months starting in 2015

Pipeline pointing to further OEM agreements

du
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Testing and development may affect timing and realization of technology adoption and sales

Desktop

Operational highlights

  • Desktop revenues increased 11% from Q1 2014
  • Strong increase in DIY sales, offset by decline in Workstations andGaming/Performance PCs
  • Gross margins declined to 36.4%
  • Explained by the change in mix of products shipped; more low margin (DIY) and less high margin products (Workstation and Gaming/Performance)
  • Four new products utilizing Asetek liquid cooling were released to the market in Q1 2015:
  • Do‐It‐Yourself products:
    • Corsair H80i GT
    • Corsair H100i GTX
    • EVGAGeForce Hybrid graphics cooler
  • Workstation:
    • Dell PrecisionTower

Newproduct launches

CorsairH100i GTX

  • I. Operations
  • II. Financials
  • III. Summary and outlook
  • IV. Q&A session

Earnings development

Desktop revenue and EBITDA margin Group EBITDA development

USD(000's)

USD(000's)

IncomeStatement – segment breakdown

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  • Desktop revenue increase of 11%
  • Offset by decrease in data center revenues
  • Due totiming of shipments on a U.S. Government contract
  • Gross margin down from Q1 14, affected by:
  • Increasedsales in lower margin DIY market
  • Lower sales inhigher margin Workstation and Gaming/Performance Desktop PC markets

Cash FlowStatement

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  • Raised a USD 12.4m in gross proceeds through a private placement in march (USD 11.6m net)
  • Raisedadditionally USD 0.6m gross in subsequent offering in April
  • USD 14.7mof cash on hand as of September 30, 2014

Balancesheet

(
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Balancesheet composition – Q1 2015

  • Inventory turns: ~13 times per year
  • Trade receivables DSO: ~44days at Q1 2015

  • I. Operations

  • II. Financials
  • III. Summary and outlook
  • IV. Q&A session

Summary and outlook

  • Fujitsu OEM agreement key milestone
  • Confirms datacenter strategy potential
  • Received first production order from Fujitsu in April
  • Value in excess of USD550 thousand
  • Strengthened financial growth platform and partner capacity trough equity raise in March and April
  • 105mat NOK10 per share (~USD 12m net proceeds)
  • USD 3.5 million project by the California Energy Commission
  • Will install RackCDUliquid cooling in two large scale data centers
  • Revenues expected to pick up
  • Expect Q2 2015 desktop revenue upwards of 40% higher than the average revenue levels achieved recent quarters
  • Over time, Asetek anticipates significant data center revenue growth to be derived fromRackCDU sales on Fujitsu platforms

Cray installation at Mississippi State University withAsetek RackCDU

Q&A

[email protected]

Appendix

Incomestatement

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