Viscom AG — Annual Report 2017

Mar 21, 2018

Viscom AG: Annual Financial Statement 2017

Hanover, 21 March 2018

Disclaimer

This presentation is not directed to the investment goals or financial position of any specific individual person or legal person. Investors should obtain independent expert counsel regarding the question of an investment in shares of the Viscom AG and carry out an analysis of the particular situation themselves.

Although Viscom has endeavored to deliver reliable, complete and up-to-date information with this presentation, the company can accept no liability for the accuracy, completeness or topicality of this information.

Certain statements in this presentation which are based on information available at present are forward-looking statements or contain specific expectations for the future. Such statements, by their nature, are subject to risks and uncertainties. Circumstances such as the general economic development, future market conditions, changes in the capital markets and other circumstances can lead to significant deviation of the actual events or results.

The information in this presentation serves general informational purposes and is neither an offer nor part of an offer or any other request to acquire, subscribe to or sell securities issued by Viscom.

Content Overview

Strategy and Market

• Key Company Figures 2017
• Technology and Outlook

2017 – A Successful Year for Viscom

2017 Annual Forecast

Revenue: € 87 – 92 million EBIT-Margin: 14 – 16 %

Viscom AG: Unique Selling Points and Strengths

USPs in the current market:

• Highest inspection quality in all inspection sectors (SPI, AOI, AXI)
• Market leader in the demanding automotive electronics segment
• Excellent reputation due to good market positioning
• Software Networking with own and open interfaces, plus participation in international standardization committees
• Systematic, consistent maintenance of technological leading position

Strategy

• Consolidate and expand market position in automotive sector
• Autonomous vehicles and electro mobility
• Expand market position in high-volume production
• Open new application areas
• Inspection of modern batteries
• Leading-edge software technologies
• Expand market position, especially in Asia

Market: Regional – Asia

• Branches in Singapore and Shanghai
• Increased sales through local distributors in China
• Participation in leading Chinese trade fairs NEPCON Shanghai and NEPCON Shenzhen
• Steadily running benchmarks and evaluations

Market: Technologies

Strong demand for X-ray inspection:

• Optical 3D inspection
• 3D inspection with X-ray technology
• Rapid growth for 3D X-ray technology, especially in Asia

Networking in SMT Production

Industry 4.0

Intelligent inspection technology – Networked inspection quality:

• Viscom Quality Uplink with Closed Loop connection
• Multiline Verification within one or several lines
• Remote Multiline Verification of several lines

Leading-Edge Software Technologies

• Artificial intelligence
• Big data

• Deep learning

• Integration of data infrastructures on customer location (IPC/CFX, Hermes standard)

• Further automation of high-end operations

Content Overview

• Strategy and Market
• Key Company Figures 2017
• Technology and Outlook

Incoming orders and order backlog

Incoming orders according to regions

		FY 2016	FY 2017
Incoming orders	K€	83,498	90,250	8.1%
thereof Europe	K€	55,017	56,609	2.9%
thereof Americas	K€	11,578	13,928	20.3%
thereof Asia	K€	16,903	19,713	16.6%
Order backlog*	K€	18,069	19,777	9.5%

Group revenue by years

EBIT and EBIT-Margin

Segment information for business units

Segment information for regions

* consolidation differences in EBIT taken into account

Employees

Employee distribution for regions Employee distribution by full/part time

* in terms of annual averages 19

Important Variables of the Group Overall Result Calculation

	FY 2016		FY 2017		Change to the previous
	K€	% to Gr	K€	% to Gr	year
Group revenue (Gr)	77,245	98.7 %	88,542	95.2 %	14.6 %
changes in finished goods and work in progress	-461	-0.6 %	2,104	2.3 %
other capitalised company produced assets	1,450	1.9 %	2,317	2.5 %
Total output*	78,234	100%	92,963	100%	18.8 %
Cost of materials	-26,022	-33.3 %	-34,051	-36.6 %	30.9 %
Staff cost	-26,918	-34.4 %	-28,724	-30.9 %	6.7 %
Other operating expenses	-15,550	-19.9 %	-16,882	-18.2 %	8.6 %
EBIT **	10,497	13.6 %	13,829	15.6 %	31.7 %
Net profit for the period **	7,129	9.2 %	9,073	10.2 %	27.3 %

* Total output = Group revenue + changes in finished goods and work in progress + other capitalised company-produced assets ** related to Group revenue

Core indicators of balance sheet and cash flow statement

Consolidated balance sheet	31.12.2016 K€	31.12.2017 K€
Cash and cash equivalents	6,517	11,506
Current liabilities	12,047	11,804
Non-current liabilities	2,298	2,778
Interest-bearing liabilities	0	0
Total shareholders' equity	52,292	56,760
Consolidated cash flow statement	31.12.2016 K€	31.12.2017 K€
Cash flow from operating activities	95	12,752
Cash flow from investing activities	-1,968	-3,428

Key figures on net assets, financial position and results

Key figures	31.12.2016	31.12.2017
Return on equity Net profit for the period / shareholder's equity	13.6%	16.0%
Return on investment (ROI) Net profit for period / total assets	10.7%	12.7%
Return on sales EBT / revenue	13.6%	15.6%
Return on capital employed (ROCE) EBIT / (total assets - cash and cash equivalents - current liabilities and provisions)	21.8%	28.8%
Equity ratio Equity / total assets	78.5%	79.6%

Dividends

Share	2016	2017
Earnings per share	€ 0.80	€ 1.02
Dividend per share*	€ 0.45	€ 0.60

* Dividend proposal 2017

• Dividend policy: Distribution of at least 50 % of the attained period result
• Suggested dividend for 2017 with € 0.60 per ordinary share represents a dividend ratio of about 59 %
• Dividend yield of about 2 % at 2017 year-end price

The Viscom Share

Shareholder structure Basic information

119 % share price increase for 2017

Content Overview

• Strategy and Market
• Key Company Figures 2017
• Technology and Outlook

Electro mobility: Application area with Demanding Requirements

Inspection requirements from the e-mobility market

• Various assemblies
• Battery management
• Control modules
• DC/DC converters
• Inverters
• Properties
• Heavier weights (up to 20 kg)
• Large heat sinks (aluminum, copper)
• Non-standard components (connectors)
• Workpiece carrier handling
• Sought: Highly flexible and economical solutions for multifaceted, comprehensive inspection requirements
• Maximum dependability and quality in the process chain

X8068SL: The solution for E-Mobility

Solution for flexible in-line X-ray inspection:

• Inspection system for X-ray inspection of assemblies in workpiece carriers
• Versatile irradiation of the objects with full range of rotation and inclination angles
• Maximum geometrical magnification: 2500x
• Highly precise analysis of solder connections in power electronics
• Fully automatic inspection with powerful analysis software

Wire Bond: The e-mobility Connections

Connection technology often used in power components: wire bonds

• Bond connections between different units of a control device
• At some locations, several parallel bond wires
• Thin wire connections to dies
• Solid conductors of flat material
• Some wires do cross in the view, but must not touch in space

Wire Bond XM camera with 3D camera technology

Powerful inspection module:

• High resolution up to 2.5 µm per pixel
• High-speed MP camera
• Multi-spectral/multi-angle illumination
• Field of view size: 21 mm x 21 mm
• 3D projector optional
• Evident increase in inspection speed means short inspection times
• Best image quality
• Most precise check of safety-related thin wires (diameter only about 20 µm)

3D AXI: High-End printed circuit board inspection

X7056-II – 3D X-ray inspection system:

• Developed for the demands of high-end electronics production
• Extremely high throughput and outstanding image quality: 4 s PCB changing time
• Combined system: AOI in front, 3D AXI in rear section
• Precise inspection of hidden solder joints and components by slice image analysis
• Winner of the "productronica innovation award 2017"
• Various sensor configurations in the X-ray section (fixed detector, movable detector)

3D AXI Sensor Technology: XXL Flat Panel Detector

Application in systems X7056-II and X8068

• 1 to 5 flat panel detectors (XXL FPD)
• High resolution of > 6 MP each FPD
• Pixel size: 50x50 µm
• 8 fps at full resolution
• Optional X/Y positioning system for FPD
• Improved image quality compared to classical image intensifiers
• 3D AXI through multiple image acquisitions

6 MP detector

What information does 3D AXI deliver?

View from above

View from below

3D slice image

The vVision App

All the information for production managers at a glance

• Convenient control of key variables like throughput and production performance
• Display of all production lines
• Offers support in process optimization and defect avoidance
• Systematic errors in placement and soldering are immediately detected
• Increases transparency in internal company coordination and logistics

Executive Board of Viscom AG as of June 1, 2018

V	Carsten Salewski
i	Board Member: Sales and International Buisiness
-	- 1968: Dipl.-Ing. (Electrical Engineering)
-	- Employed at Viscom since 1993
-	- Since 2003, President of Viscom Inc., Atlanta/USA
V	Peter Krippner
i	Board Member: Operative Business, Units SP, NP and Service
-	- 1964: Dipl.-Ing. (Electrical Engineering)
-	- Employed at Viscom since 1988
-	- Since 2001, Vice President of Business Unit Serial Products SP
V	Dr. Martin Heuser
i	Executive Board: Development and Production
-	- 1957: Dr.-Ing. (Electrical Engineering)
-	- 1984: Co-founder of today's Viscom AG
-	- Since 2001: Executive Board, Viscom AG
V i - - -	Dirk Schwingel Executive Board: Finances, Human Resources and Investor Relations - 1963: Dipl.-Kaufmann - Employed at Viscom since 2010 - Since 2011: Executive Board, Viscom AG

Changes in the Viscom AG Supervisory Board

Supervisory Board until May 30, 2018

Supervisory Board as of May 30, 2018

Bernd Hackmann Chairman

V N.N.*

Klaus Friedland Deputy Chairman

Prof. Dr. Ludger Overmeyer Member of the Supervisory Board

V Prof. Dr. Ludger Overmeyer

* Subject to consent through the General Meeting on May 30, 2018

Outlook

What the future offers us and how we will reach our goals:

• Leverage megatrends and profit from current directions
• Autonomous vehicles, electro mobility, miniaturization of electronic components
• Strongly advance software development
• Industry 4.0, big data and artificial intelligence
• Further strengthen and expand global presence

Guidance 2018

REVENUE

2018 Annual Forecast