Siltronic AG — Investor Presentation 2021

Jul 1, 2021

Siltronic – Factbook

Investor Relations July 2021

Content

• Company and market overview
• Siltronic – one of the industry technology leaders
• Strategy
• Sustainability
• Employees
• Financials & investment rationale
• Siltronic share & tender offer of GlobalWafers
• Corporate Governance
• General information

COMPANY AND MARKET OVERVIEW

Siltronic at a glance

4 world-class production sites

~ 3,800 employees

global scale and reach

50+ years of history in silicon technologies

Key financial figures 2020

• Sales: EUR 1,207.0 million
• EBITDA: EUR 332.0 million
• EBITDA margin: 27.5%
• Net cashflow: EUR 77.4 million
• Net financial assets: EUR 499.2 million

More than 50 years of experience in the semiconductor industry

International manufacturing network supports strong market position and business focus

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Consolidated market with 5 major wafer manufacturers

Top 5 wafer producers serve more than 90% of market across all diameters

Sources: reported company revenues Q1-Q4 2020, converted to USD million

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Electronics value chain 2020

Increasing demand for electronic devices and new applications drive semiconductor growth, which in turn fuels silicon demand

Source: Electronics (IC Insights), Semiconductors (WSTS, only silicon-based), Silicon wafers (SEMI SMG), Electronic applications (estimate)

Siltronic is focused on growing 300 mm and attractive 200 mm business.

Development of total wafer demand per diameter, in mn 300 mm equivalents per

Source: SEMI up to June 2021

A broad product portfolio covers standard and leading-edge requirements of the customers

Note: CZ: Czochralski crystal growing, FZ: float zone technology

Electronic equipment contains multiple devices built on tailormade silicon substrates

Pictures: AdobeStock_181844841; AdobeStock_55587517; AdobeStock _218649399

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Industrial semiconductor segment comprises a wide range of applications

Medical

• diagnostics and control
• imaging equipment
• laboratory test

• patient monitoring

• equipment for energy production and distribution

• industrial power supplies
• energy meters

Building & Home Manufacturing

• built in climate control
• lighting
• safety & security equipment

Power & Energy Aerospace & Military Other Industrial

• aircraft systems
• radar, sonar, avionics
• missile guidance

• military grade computers

• manufacturing equipment

• robotics
• process control equipment
• measurement instruments

• motor controls

• power tools

• ATMs
• ships, golf cars, electric bikes and trains

Pictures: appliedmaterials.com; AdobeStock_356279818; AdobeStock_240858509; AdobeStock_101580295; AdobeStock_216164502; AdobeStock_282814163

New applications for electronic devices and the infrastructure to support them continue to drive silicon demand

Current growth drivers include

Pictures: coolhand118/stock.adobe.com, tippapatt/stock.adobe.com, monsitj/stock.adobe.com, Wellnhofer Designs/stock.adobe.com, 安琦 王/stock.adobe.com, AdobeStock_101580295

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Global megatrends drive sustained increase in wafer area

Devices become increasingly intelligent and see continuous improvement in functionality and energy efficiency

Estimated silicon area market development in 2021

SILTRONIC - ONE OF THE INDUSTRY TECHNOLOGY LEADERS

Wafer production process

Top technology position complemented with a high level of quality

A leading position in wafer technology

• First supplier to ship 300 mm wafers
• Development of 3 nm design rule started in 2019 (commercialization expected to start in 2022)
• Concurrently optimizing on 50+ wafer parameters of each design rule
• Single wafer traceability for 300 mm
• Standardized processes across sites enabling "copy exactly" at product level

R&D expenditure, in EUR million (% of sales)

400 engineers worldwide

Approximately 1,850 pending and active patents in almost 370 patent families*

Quality awards from several top semiconductor customers received over the years

*as of December 31, 2020

Siltronic is continuously improving its wafer solutions to match customer needs

A number of key ingot & wafer properties define the wafer specification and its further use by the customer

2 key requirements – purity and flatness

Purity of 1 ppt "parts per trillion" prerequisite for semi applications

1 ppt = 3 – 4 dissolved sugar cubes (~ 10 grams of sugar)

Flatness of a wafer – another key requirement

Image source: AdobeStock_13405644; AdobeStock_242331781; AdobeStock_242331781; adrian-infernus-jzfokcIaRlw-unsplash

Capital-intensive industry with capex mainly in capabilities and cost savings but also in some capacity over the cycle

Siltronic Capex, in EUR million

Strategy based on four pillars

Optimize returns, stay ahead in technology and grow with the market

Our objectives and values

Short innovation cycles characterize the semiconductor industry

Siltronic wants to take advantage of growth opportunities by focusing on innovative solutions that add value and thereby help to meet customers' new requirements

Cost-competitiveness a pre-requisite in the wafer industry

SUSTAINABILITY

Sustainability at Siltronic

Clear commitment to sustainability

• Claim: We understand sustainability not only as responsible action, but also want to generate competitive advantages through our sustainable actions.
• Strategy: We plan resource-saving right from the start, based on product and production safety as well as health and environmental protection.
• Voluntary commitments: We follow the principles of the Responsible Business Alliance (RBA) and the United Nations Global Compact.
• Goal: We want to reconcile the effects of our business activities with the expectations and needs of society.

CSR targets until 2030

Reduce specific energy consumption by 20%¹

Increase waste recycling by 25%¹

Reduce specific water consumption by 20%¹

Increase water recycling by 25%¹

Reduce specific greenhouse gas emissions by 20%¹

Ratings

Climate Change "B | Management" Water Security "B | Management"

"Prime" rating

CSR track record 2020

CSR topic	Target 2020	Status	Notes
	Reduce energy intensity by 1.5%		Energy consumption reduced by 7.1 GWh in 2020 with energy efficiency program
	Increase waste recycling ratio by 1.5%		With a waste recycling ratio of 70.3% target for 2020 was reached. Since base year 2015 recycling ratio has increased >10%
	Reduce specific water usage in production by 1.5%		Specific water consumption decreased by 5.4% in 2020
	Increase water reuse ratio by 1.5%		Slight decrease of water reuse ratio in 2020; however increase of > 10% since base year 2015
	Reduce CO emission 2 intensity by 1.5%		Reduction of absolute Scope 1 and 2 emissions by 2.2% p.a. compared with base year 2015

Siltronic enables technologies for a sustainable future

Resource efficency

Innovation driver for environmentally friendly and resource-saving technologies

Industrial automation and smart factories

Increasing wafer content

Raw materials

• Energy consumption
• Water recycling
• Emissions

Sustainable mobility

Reduction of transport emissions and carbon footprint to achieve climate targets

Increasing safety and efficiency

EV´s with substantially higher wafer content

Clean energy

Wafer as a foundation for semiconductors enable clean, renewable energy sources and improving energy efficiency

Renewable energy needs more and more wafer content

Change in global electricity, 2000 - 2019 vs. 2019 - 2040

Source: IEA Global EV Outlook 2021; IEA 2020 World Energy Outlook

Employees

HR Strategy

Global HR strategy supported by decentralized organization

Attractive remuneration Basic salary with vacation and Christmas bonuses and additional variable compensation components

Diversity and equal opportunity Diverse workforce with a wide range of skills and talents

Contemporary working models Flexible working hours and home office

Personnel development opportunities Education, training and support programs

Occupational safety, plant safety, health Extensive preventive measures and high

safety standards; Employee health prevention programs

Work-Life balance Various support options (like extra vacation for parents) to combine

work and personal life planning

Global HR Strategy

Various social benefits Insurance, healthcare and pension offers

Diversity at Siltronic

all figures relate to FY 2020

Occupational health and safety is a key focus

Responsibility towards the entire workforce plays a major role within the Siltronic organization

Occupational safety

• Continuously improving safety standards
• Key Measures:
• Safety officers, safety inspection tours, training courses, emergency drills

Working accidents

• Regularly reported with special focus on injuries involving chemicals
• No fatal accidents occurred in the last few years
• Global system to report near-miss incidents

Health protection

• Company programs for health prevention of our employees
• Various healthcare offers for employees

Plant safety

• Safe operation of our production facilities
• No event in 2020 was classified as an incident or as an hazardous incident ordinance
• Systematic safety analyses to determine risks

Corona Pandemic

• Successful hygiene measures meeting legal requirements; home office, adapted shift models and video conferences
• Vaccination and testing
• No severe cases at Siltronic

FINANCIALS & INVESTMENT RATIONALE

Attractive margins and strong cash flows through the cycle

Strong equity ratio and solid net financial assets

Key investment highlights

Market Position

Strong market position in the semiconductor and wafer industry

Customers

Supplier to all top 20 silicon wafer consumers

Products

High-quality wafers made of hyper pure silicon

Strategy

Best-in-class technology and quality

Financials

Profitable sales increase and ongoing efficiency improvement

Management

Experienced management team and highly skilled workforce

Creating value for all stakeholders

SILTRONIC SHARE & TENDER OFFER OF GLOBALWAFERS

Siltronic shares at a glance

Broker	Analyst
Berenberg	Gustav Froberg
Citigroup	Amit Harchandani
Commerzbank	Florian Treisch
Deutsche Bank	Rob Sanders
Jefferies	Constantin Hesse
Kepler Cheuvreux	Martin Jungfleisch
Stifel	Jürgen Wagner
Nord LB	Thorsten Strauß
Oddo BHF	Stephane Houri
UBS	Francois-Xavier Bouvignies

Share price more than quadrupled since IPO Dividend payment per share, in EUR

Year end closing share price, in EUR; Market cap in EUR billion

Coverage Consensus

Our full consensus is available here: Information on the share – Siltronic / perfect silicon solutions

Share information

ISIN / Symbol: DE000WAF3001 / WAF300 ISIN tendered shares / Symbol: DE000WAF3019 / WAF301 Trading platform: Prime Standard - Xetra, Frankfurt Indices: SDAX, TecDAX No. of shares: 30.000.000.000 (registered shares; one share = one vote)

General dividend policy established in 2017: payout ratio = around 40% of net income attributable to

Siltronic shareholders

Executive Board and Supervisory Board welcome the tender offer of GlobalWafers

Industry Strategy	− Create one of the leading players in the industry with a comprehensive and technologically sophisticated product portfolio for customers worldwide − Expanded production and technology capabilities to satisfy growing demand − Allow combined business to expand capacity at the right time − Significantly increased financial and operational capabilities
Shareholders	− EUR 145 per share in cash − Wacker Chemie tendered its entire stake of approx. 30.8%
Siltronic	− Burghausen site to remain Siltronic R&D hub − Sufficient investment budgets to maintain and further develop existing production capacities − Continue Siltronic under existing name and preserve Siltronic brand
Employees	− Comprehensive protection clauses for employees and sites in Germany − Corporate co-determination remains unchanged − Existing pension plans remain unchanged

Tender offer of GlobalWafers changed shareholder structure

Significant notifications of voting rights (>3%) (as of June 18, 2021)

Sino-American Silicon Products	13.67%
JP Morgan Chase & Co.	6.50%
Goldman Sachs	4.86%
UBS Group AG	4.18%
Bank of America Corporation	4.01%
Morgan Stanley	4.07%
BlackRock	3.85%
Alex Litowitz (Magnetar)	3.84%
Capital Group	3.03%

CORPORATE GOVERNANCE

Dual management system with a balanced Supervisory Board

Two-tier system

Dual Board

In accordance with German Corporate Law (codetermination) and Corporate Governance Code 2020 both bodies cooperate closely and in a spirit of trust in managing and overseeing the company.

Supervisory Board composition

Shareholder representatives: 4 male & 2 female members Employee Representatives: 4 male & 2 female members

Independence: At least 4 shareholder representatives within the meaning of the German Corporate Governance Code.

Preparation of Supervisory Board Meetings: Separate preparatory meetings of the shareholder and employee representatives

Supervisory Board committees

Audit Committee	prepares Supervisory Board decisions on financial reporting and deals with issues concerning risk management & compliance
Executive
Committee	deals with personnel matters of the Executive Board and its compensation
Nomination	responsible for proposing suitable
Committee	candidates to be elected as shareholder
	representatives on the Supervisory Board
Conciliation Committee	formed pursuant to German Co determination Act

Skilled Supervisory Board with majority of shareholder representatives being independent

Shareholder representatives		Employee representatives
Dr. Tobias Ohler	Prof Dr. Gabrijela Dreo Rodosek	Gebhard Fraunhofer	Johann Hautz
Member of the Executive Board of Wacker Chemie AG	Executive Director of CODE research institute and Chair for	Chairman of Siltronic AG General Works Council of Siltronic AG	Exempted works council of Siltronic AG, Burghausen
Since 2013 (Chair since 2015) until 2023	Communication Network Security at Universität der Bundeswehr	Since 2016 until 2023	Since 2003 (Deputy chair since 2016)
Conciliation Committee (Chair), Audit Committee, Executive Committee, Nomination Committee (Chair)	Since 2018 until 2023 independent	Conciliation Committee, Audit Committee	until 2023 Conciliation Committee, Executive Committee
Sieglinde Feist Head of Sales & Distribution Wacker Chemie AG	Dr. Hermann Gerlinger Managing Partner of GeC GmbH	Mandy Breyer Deputy chairman of General Works Council of Siltronic AG, Freiberg	Klaus-Peter Estermaier Head of Supply Chain Management Siltronic AG
Since 2014 until 2023	Since 2011 until 2023	Since 2018 until 2023	Since 2018 until 2023
Conciliation Committee	Executive Committee (Chair), Nomination Committee independent
Michael Hankel	Bernd Jonas	Lina Ohltmann	Markus Hautmann
former member of the Executive Board of ZF Friedrichshafen AG	Independent Lawyer	Specialized Secretary of Mining, Chemical and Energy Industrial Union (IG BCE), Union Pay Policies	District Manager of Mining, Chemical and Energy Industrial Union (IG BCE) Altötting
Since 2018 until 2023	Since 2015 until 2023	Department
Executive Committee	Audit Committee (Chair)	Since 2021 until 2023	Since 2021 until 2023
independent	independent

Highly experienced Executive Board

Dr. Christoph von Plotho CEO

Born: October 16, 1955, Beuel/Bonn German

Professional Career

Since October 2010: Siltronic AG Executive Board Chair Appointed until December 31, 2023

Rainer Irle CFO

Born: March 17, 1970, Bergneustadt German

Professional Career

Since January 2013: Chief Financial Officer in Siltronic AG Executive Board Appointed until December 31, 2025

• 2005: Head of WACKER SILICONES business unit
• 2003: Head of WACKER SPECIALTIES business unit
• 2000: Business Unit Head Fluids; Emulsions at WACKER SILICONES
• 1999: Management Spokesperson at Elektroschmelzwerk Kempten GmbH
• 1996: Business Unit Head of Elastomers as Wacker Silicones Corporation, Adrian, USA
• 1995: Direttore Tecnico at Silmix SpA, Peschiera, Italy
• 1994: Project Supervision Silmix SpA; Peschiera, Italy
• 1992: Directeur Technique et Chef de Marche at Wacker Chimie S.A., Lyon
• 1984: Initial position as laboratory director at Wacker Chemie GmbH

2008: Head of Corporate Controlling, Wacker Chemie AG, Munich 2006: Chief Financial Officer at Siltronic Corporation, Portland, USA

• 2003: Joined Wacker Siltronic AG as Director Strategic Planning
• 1997: Management consultant at A.T. Kearney GmbH, Düsseldorf 1989: Trainee at Deutsche Bank

Siltronic incentivizes the Executive Board appropriately and with long-term and ESG orientation

Compensation system of Executive Board has received high approval from shareholder with 98.8% majority in AGM 2020

Overall-Cap

Contact and Additional Information

Issuer and Contact

Siltronic AG Einsteinstraße 172 D-81677 München

Investor Relations: email: investor.relations@siltronic.com

Additional Information

WKN:	WAF300
Deutsche Börse:	WAF

ISIN: DE000WAF3001 Listing: Frankfurt Stock Exchange Prime Standard

Financial Calendar 2021

Q2 Interim Report July 28, 2021 Q3 Quarterly Statement October 26, 2021

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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