Siltronic AG

Q3 2023 Conference Call Presentation

In line with expectations

October 26, 2023

Development in Q3 in line with expectations

Q3 2023 still impacted by industry weakness, but on a solid level

28.4 EBITDA Margin in % Q2 2023: 29.4

Stable Pricing environment

-215 Net Cash Flow in EUR mn Q2 2023: -310

318 Capex in EUR mn Q2 2023: 366

Nov 30 Capital Markets Day London

Siltronic AG – Q3 2023 Conference Call October 26, 2023 3

Financials Q3 2023

Sound and expected performance in a still challenging environment

Q3 in line with expectations, pricing sentiment stable

Profit & Loss, in EUR million Comments

	Q3 2023	Q2 2023	Q1-Q3 2023
Sales	349.1	403.7	1,157.2
Gross profit	75.7	101.1	293.0
Gross margin, in %	21.7	25.0	25.3
EBITDA	99.1	118.6	342.8
EBITDA margin, in %	28.4	29.4	29.6
EBIT	46.4	70.3	194.5
EBIT margin, in %	13.3	17.4	16.8
Net Income	35.1	61.4	169.0
EPS, in EUR	1.10	1.83	5.13

Sales: -14% qoq

Lower wafer area sold
Stable prices and FX

EBITDA: -16% qoq, solid margin

Stable unit cost for materials and energy
Lower fixed cost dilution, but no negative inventory effects (like in Q2)
Positive FX result of EUR 10 mn

EBIT: -34% qoq

Expected increase in depreciation

Net income: -43% qoq

Reduced interest income due to lower cash position
Increase in tax rate due to shift in site mix

Some insights into our FX effects

FX Exposure 2023, in % FX Impacts

USD Sensitivity, based on 2023 exposure (EUR/USD 1.10)

Change EUR/USD ± 1 USD-ct

EUR 10 mn in Sales
EUR 7 mn in EBITDA, unhedged (including highly correlated SGD-effect)

USD Hedging strategy

Operational hedging
Strategic hedging: gradual hedging up to 18 months ahead, based on net FX exposure

FX result (in other operating income/expenses)

Mostly FX hedging
Other valuation effects (trade receivables, payables)

Strong balance sheet – expected shift between cash & securities and fixed assets

Balance Sheet Composition Comments

	Sep 30, 2023	Dec 31, 2022
Assets, in EUR mn	4,326	4,051
Fixed Assets	73%	58%
Inventories	7%	7%
Receivables	8%	9%
Cash & Securities	12%	26%
Liabilities, in EUR mn	4,326	4,051
Equity	49%	51%
Provisions	5%	5%
Financial Liabilities	21%	19%
Liabilites & Prepayments	25%	25%

Fixed assets: + EUR 795 mn vs. Dec 31, 22

Increase to EUR 3.2 bn due to high capex

Cash & Securities: - EUR 543 mn vs. Dec 31, 22

Decline to EUR 506 mn
Operating cash flow < payments for capex and dividend

Equity Ratio: 49%

Healthy level

Financial Liabilities

Last drawdown of Singapore Dollar loan in Q3 23

Liabilities/Prepayments

Customer prepayments received: EUR 79 mn
Provisions for pensions: slight decline to a historically low level

Major Capex in 2023 (mostly for FabNext) will fuel future growth

Capex

Capex 2023 for FabNext, extension of crystal pulling hall in Freiberg (inaugurated in September) and capability enhancement
Capex 2024 will be reduced by more than half

Conservative Financing Approach

Existing cash and future operating cash flows
Customer prepayments

High Capex covered by strong financing base

Net Financial Debt, in EUR mn

Comments

Four financing instruments in place

Fully drawn
ESG linked promissory note loan
Singapore Dollar bilateral loan
European Investment Bank loan
Not drawn
Syndicated loan (term loan and RCF) EUR 380 mn

Net financial assets Dec 31, 2022, turning into net financial debt Sep 30, 2023

Solid operating cash flow
Peak invest outflow, mainly for FabNext
Dividend payment
Change in net financial position EUR -689 mn

Outlook 2023 and beyond

We are consistently preparing for the next profitable growth phase

Market environment still challenging nevertheless stable pricing and solid profitability

End markets are expected to stagnate in 2023 (before inventory effects)

Growth in demand for wafer area 2023 vs. 2022, in %

Source: Siltronic estimates, ¹ Infrastructure Telecommunications, game consoles, consumer electronics such as televisions, white goods such as refrigerators

Siltronic AG – Q3 2023 Conference Call October 26, 2023 12

Consumption of wafers

Wafer demand in 2023 will be down around 15% due to inventory reductions; soft demand trailing into 2024

Zusammensetzung der Wachstumstreiber für S vs. TAM, Composition of growth drivers for wafer market 2023 vs. 2022, in %

The crystal ball has not cleared yet!

Inventory status:

Memory peaked but still elevated, DRAM and NAND prices stabilizing

Logic close to normal levels

Power increasing, Auto forecast positive has to be watched

Economic and geopolitical uncertainties persist:

Consumer sentiment in China
Persistant inflation
Geopolitical risks

Typical time-lag for wafer industry to turnaround: 6 months

Source: nigel-tadyanehondo/unsplash.com

FabNext first wafers to be produced soon - Freiberg pulling hall inaugurated in September

First wafers to be produced soon
Focus on qualifying customers
High share of LTA, 80% during ramp phase
Ramp speed for 2024 and 2025 slightly adjusted as communicated in Q2
EBITDA-Margin above 50% mid-term with growing impact on Group Margin during ramp
Extension of crystal pulling hall inaugurated
Several hundred million euros invested
Product mix improvement

Source: Siltronic

Outlook 2023 confirmed and substantiated on the upper range of the bandwidths

FY 2023

Sales 15% 17% below 2022

EBITDA Margin 28% 30%

Depreciation around EUR 200 mn

Capex around EUR 1.3 bn

Net Cash Flow significantly below 2022

Tax Rate around 15%

Based on FX assumption EUR/USD at 1.10

Next highlight: Capital Markets Day in London on November 30, 2023

Venue: Andaz Hotel, 40 Liverpool Street, London Time: Start 9 am until around 3 pm CMT

Main Topics:

Strategy update and mid-term outlook
Industry and technology deep-dives

Presenters:

Dr. Michael Heckmeier, CEO
Claudia Schmitt, CFO
Head of Marketing & Sales
Head of Application Technology
Head of Marketing & Global Power Business

Further Information:

https://www.siltronic.com/en/investors/capit al-markets-day.html

Contact and Additional Information

Issuer and Contact

Siltronic AG Einsteinstraße 172 D-81677 München

Investor Relations:

Verena Stütze E-mail: [email protected] Tel: +49 89 8564-3133

Additional Information

WAF300
WAF

ISIN: DE000WAF3001 Listing: Frankfurt Stock Exchange Prime Standard

Financial Calendar 2024

March 12 FY 2023 results May 2 Q1 2024 results
July 25 Q2 2024 interim results
October 24 Q3 2024 results

Disclaimer

The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements contained in this presentation may be statements of future expectations, future financial performance and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties. In addition to statements which are forward-looking by reason of context, including without limitation, statements referring to risk limitations, operational profitability, financial strength, performance targets, profitable growth opportunities and risk adequate pricing, words such as "may", "will", "should", "expects", "plans", "intends", "anticipates", "believes", "estimates", "predicts", "continue", "projects" or "seeks", "potential", "future", or "further" and similar expressions may identify forwardlooking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions which could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These include, among other factors, changing business or other market conditions, currency and interest fluctuations, introduction of competitive products, poor acceptance of new products and services, change of the corporate strategy and the prospects for growth anticipated by the management. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Siltronic AG does not undertake and does not intent to undertake any obligation to update or revise any statements contained in this presentation, whether as a result of new information, future events or otherwise. In particular, you should not place any reliance on forwardlooking statements which speak only as of the date of this presentation.

SILTRONIC AG | Einsteinstrasse 172

81677 Munich Germany