Rohm and Haas Company

Transcription

1 Rohm and Haas Company Appendix Overview of Strategic Core Businesses 1 Electronic Materials Group 2

2 Electronic Materials Group Electronic Technologies Semiconductor Technologies Circuit Board Technologies Packaging & Finishing Technologies Electronic Materials Group Display Technologies Strategic Intent Double Electronic Materials sales by 21, to $3.5 Billion Grow current core Electronic Technologies segment Semiconductor, Packaging and Circuit Board Businesses Technology-driven organic growth Bolt-on acquisitions Expand into other attractive areas Build robust Display Technologies segment, 21 target $5 million Establish new platforms beyond current scope through M&A 3 Electronic Materials Group Track Record Group Sales Group After-Tax Operating Earnings (1,NG) $ million 1,75 1,5 1,25 1, % CAGR $ million % of sales 5 years of expanding margins! 11% 13% 15% 17% of sales (1) Excluding restructuring and asset impairments (NG) Non-GAAP measure 4

3 Electronic Technologies Segment Our Historic Core Semiconductor Technologies Packaging & Finishing Technologies Circuit Board Technologies Global leader in CMP (Pads and Slurries) #2 Worldwide in Photolithography Materials Advanced packaging Solderable lead-free finishes Durable finishes for connectors Decorative finishes Materials for metallization and imaging Environmentally friendly product focus New area: photovoltaics 5 Driving Growth in Semiconductor Key Drivers Semiconductor Sales Increased use of CMP, particularly in memory Strong growth in photolithography Share gain in 193nm, particularly immersion Expansion of process chemicals required for advanced litho (e.g. ARCs) Leverage Asian infrastructure and close customer relationships Growth disproportionately in Asia Joint development approach Aggressive technology introduction continue to obsolete ourselves Semiconductors: invest >1% of sales in R&D 1,5 1,25 1, % CAGR % CAGR

4 Major Investments in Semiconductor Leading Edge Technology, Close to Industry Leaders CMP Technology and Manufacturing Center Hsinchu, Taiwan Microelectronics Technology and Mfg Center Cheonan, Korea 193nm Immersion Lithography System Marlborough, MA $5 million $3 million $6 million 7 Key Driver: Silicon Units (Area) Shipped Indexed Comparison of Silicon Units (Area) Shipped vs. ROH Semi Sales 1.8 ROH Semiconductor Sales Si Units (Area) Shipped (MSI) 1..8 Q4/8 Q3/8 Q2/8 Q1/8 Q4/7 Q3/7 Q2/7 Q1/7 Q4/6 Q3/6 Q2/6 Q1/6 Q4/5 Q3/5 Q2/5 Q1/5 Q4/4 Q3/4 Q2/4 Q1/4 Index (Q14 = 1.) Source: Gartner DataQuest, ROH 8

5 Display Technologies Segment New Growth Platform Large, growing market Very materials intensive Over half of display cost is materials Insertion points for new entrants Performance: speed, contrast ratio, viewing angle, brightness Cost: yield, materials reduction, throughput, reliability Multi-function: combine functions of multiple components Asia focus Why is the Flat Panel Market Attractive to ROH? 9 Overview of the Flat Panel Market >$12B Market in 21, Dominated by LCD Though OLED Growing Very Rapidly LCD PDP Flat Panel Technology CAGR 27 to 21 $ Basis m 2 Basis OLED LCD PDP 8% 2% 2% 17% OLED 75% 87% Source: DisplaySearch Q4 7 Quarterly Worldwide Flat Panel Forecast Report: Pivot Tables 1

6 LCD Growth Driven by TV Applications LCD Area Shipments (million m2) Other Notebook Monitor Television CAGR % 19% 9% 26% Source: DisplaySearch Q4 7 Quarterly Worldwide Flat Panel Forecast Report: Pivot Tables 11 A Typical LCD Display Many Layers, Many Materials Polarizer Polarizer Protection films Treated TAC Release Layers LCD Cell Polarizer LCD Cell TFT and MVA Resist Color Filter Pigment Dispersions Backlight Unit Backlight Unit Brightness Films Microlens Films Diffusers Reflectors 12

7 LCD Value Chain Materials Specification BLU Performance Specification Final Performance Specification Backlight Materials Backlight Unit Manufacturers Display Panel Manufacturers Brand Owner / Integrator Reflectors Diffuser films Brightness films Light guides CCFL lamps Assembled backlight units Assembled displays (backlight unit + back plate + front plate + driver IC + frame + ) Finished, retail-ready displays Rohm and Haas 3M Shinwha E-fun Wooyoung Harrison Toshiba Sankan Nichia OSRAM Keiwa Tsujiden Teijin-DuPont Radiant Coretronics Heesung Taesan LCD Forhouse K-Bridge Stanley Sharp Mitsubishi Nippon Denyo Samsung Sony Sharp AUO CMO LG Philips Samsung Sony Bravia Sharp Aquos LG Panasonic Vizio Philips Toshiba Hitachi JVC 13 Building a $5 + MM Display Materials Business Objectives for Display Technologies Segment Build a $5 million business by 21 in LCD and PDP display materials Driven by technology differentiation Multi-functional films LED backlight-optimized films Process chemicals Leveraging SKC and Kodak synergies SKC: cost position, manufacturing infrastructure, market presence Kodak: technology pipeline, technical expertise, IP Expand into materials for OLED displays 6 Sales $MM Process Chemicals Kodak LMF SKC Haas PDP Films SKC Haas LCD Films OLED and Other Materials Process Chemicals New Films for LCD & PDP Existing Films for LCD & PDP Today s FPD portfolio (1) (1) Annualized run-rate of sales 14

8 Targeting ~$8B of >$5B Materials Market 1% 8 ~$6.5B Process Chemicals Specialty Films ~$1B ~$.5B 6 4 Polarizer Films Optical Filter Functional Materials 2 Backlight Films LCD PDP OLED Source: DisplayBank, DisplaySearch, Yano Reasearch and Internal Estimates. 15 Why Can We Succeed in Displays? Industry leading portfolio of enabling display materials Focus in LCD: backlight films, polarizer components, specialty film applications and process chemicals Strong position in PDP: optical filters Targeted position in OLED: functional materials World-class manufacturing competencies and Asian-based footprint and supply chain Strong Intellectual Property portfolio Customer intimacy leveraging Rohm and Haas Electronic Materials and SKC Haas relationships History of success in markets that place a premium on innovation and advanced technology 16

9 Building a $3.5B Electronic Materials Group Broader Portfolio Increasingly Asia Focused 3,5 3, New Areas TBD (M&A) 3,5 3, NAR 2,5 Displays 2,5 ER 2, Circuit Board 2, 1,5 1, 5 Circuit Board Pkg. & Fin. Pkg. & Fin. Semiconductor Semiconductor 1,5 1, 5 NAR ER APR APR 26 21E 26 21E 17 Success Breeds Success in Electronics Driven by innovation technology roadmap Asia presence Infrastructure Customer relationships Strong local leadership Proven M&A track record Capacity and willingness to invest Deep application knowledge Strong collaboration / early customer engagements Healthy paranoia 18

10 Paint & Coatings Materials 19 Paint and Coatings Materials Overview Our Business Today $2.1 billion in annual sales 3 plant sites in 22 countries 4 R&D centers: U.S., China, France and Brazil 5 years experience and expertise in this market Valued supplier to global, regional and local paint and coatings companies for both binders and additives ROH Position Acrylic Binders #1 Additives for #1 Architectural Coatings Market Attractiveness Market growth > GDP Consumers demanding better performance Environmental trends drive need for new technologies 2

11 Paint and Coatings Materials End Use Markets Decorative Coatings % of Total ~7% 27: Sales $2,12 MM EUROPEAN REGION Industrial and other Coatings Building Products ~2% ~1% NORTH AMERICAN REGION $1,258 59% $396 19% $326 15% $14 7% ASIA PACIFIC REGION LATIN AMERICAN REGION 21 The World In Which We Live The coatings market is consolidating Growth is occurring disproportionately in Rapidly Developing Economies Consumers are willing to pay for differentiation Regulatory and consumer preference for low VOC solutions continue 22

12 Paint and Coatings Materials Strategic Intent Build a $3+ Billion Paint & Coating Materials Business by 21 Strengthen position in Architectural and Industrial Acrylic Coating markets Broaden market participation and technology base Grow in Rapidly Developing Economies Leverage relationships with key customers to capitalize on industry consolidation 23 The Right Chemistry For Five Decades! Specialty, Designer Polymers Consistent Flow of Product Innovation Multilobe Morphology Multi Domain Morphology Core/Shell Morphology Bimodal Particle Size Polymer Blends Hollow Sphere Polymers TiO 2 Polymer-Pigment Composite Monodispersed Latex The World Leader in Coatings Technology Formulated savings better performance Formaldehyde free Elastomeric coatings for walls and roofs High durability exterior coatings Biobased raw materials Improved efficiency better hiding Low VOC paints High-scrub interior paints Water-based, high-gloss paints Solvent-free binders Quick-set, water-based traffic paints Multilobed binders for better film build Stain blocking primers Acrylic durability Water-based technology that adheres to metal, wood, cement and more 24

13 Broaden Participation in the ~$48B Global Coatings Materials Market Broaden Market Participation Broaden Technology Base Automotive Industrial Solvents Pigments Binders ~$23 B Acrylic Polyurethane Vinyl Alkyd Epoxy Polyester Other ROH ROH Architectural Additives ~$4 B Rheology Other Binders Additives Pigments Solvents Architectural beyond decorative Industrial Coatings Continue to improve acrylic technology Expand beyond acrylics 25 Drive Growth in RDEs Moscow Gebze Querétaro Sanshui Taloja Chennai Newest manufacturing sites 4 $MM Paint & Coatings RDE Sales 25% Growth Key Drivers Broad and expanding manufacturing footprint Regional technical infrastructure, especially China R&D Center Products tailored to local needs broader technology base, more local development 26

14 Deep Customer Relationships Open New Growth Opportunities Helped Jotun develop a premium interior paint that is easy to clean and ensures the vibrancy of color 15 months from conception to launch ROH a partner throughout development cycle Helped a leading multinational paint company in China create a functional architectural paint that addresses consumer desire for healthy living Formaldehyde-absorbing interior paint Leading Asian Paint Company 27 Must Leverage Relationships with Industry Leaders Global Paint and Coatings Market Sales of Largest Producers 45% 45% 45 $42B $4B 4 42% $34B 35 38% % share 38% $29B $28B 3 Akzo Nobel 25 ICI PPG 2 SigmaKalon Dupont Sherwin-Williams Valspar BASF Nippon Paint Kansai Behr E Top 11 coatings players in 2 had ~38% share Top 9 in 28 will have ~45% share Critical to play with the leaders 28

15 Building a $3 + Billion Coatings Platform More Balanced Portfolio Broader Geographic Mix 3,5 3, M&A Construction 3,5 3, LAR 2,5 RDEs Industrial 2,5 APR 2, 1,5 Construction Industrial Organic * 2, 1,5 LAR APR EMEAR EMEAR 1, 5 Architectural Architectural 1, 5 NAR NAR 26 Sales 21 Sales 26 21V 29 (1) Organic* including pricing and currency Succeeding in Paint and Coatings Leading market positions in Architectural Coatings Technology base well suited to increased environmental performance demands Expertise to tailor products to customer / regional needs, coupled with a supply chain that can make and deliver them anywhere in the world Industry knowledge and strong channel to market that can be leveraged to expand beyond the current space 3

16 Niche Businesses 31 Niche Businesses Overview Our Business Today Leading market positions and unique solutions for bioprocessing, water treatment, antimicrobial, and food markets The base for expanding beyond today s core New-to-the-company technologies Different business models Addressing key global mega trends ROH Position Ion exchange resins #1 Biocides #2 Sodium borohydride #1 Market Attractiveness Diverse, profitable, global end markets Fast-growing niches exist, requiring new technologies Opportunities to play in different steps in the value chain 32

17 Building a $1.5 + Billion Niche Portfolio 26 Sales: $.8B Other Businesses Process Chemicals & Biocides Business Area Ion Exchange Resins Alignment With Mega-Trends Water Energy Hygiene Food 21 Sales: $1.5 + B Biocides A diverse portfolio of differentiated niche businesses aligned with mega trends and leveraging existing positions of strength AgroFresh New TBD 33 Niche Businesses Strategic Intent Build a $1.5+ billion portfolio of differentiated niche businesses by 21 Expand key existing business lines into new areas and new steps in the value chain Develop new businesses focused on fastgrowing market segments and geographies requiring new technologies Water, energy, hygiene, food Continuously manage the portfolio performance vs. potential 34

18 Driving Growth in Ion Exchange Resins Bio-Energy and Water Applications a $2B Addressable Market Energy Water Rohm and Haas is a leader in solutions for purification of biodiesel Provide complete offering of process technology, equipment, purification media, and support services Recently introduced catalyst for biodiesel production Enables use of lower cost feedstocks Improve processing efficiency and yield Recently announced strategic alliance with Basin Water for potable water applications in the US and Canada ROH: IER technology, R&D strength, and Global infrastructure BWTR: systems design, deployment and operating strength Serving public and private sector groundwater treatment needs Will also conduct R&D in groundwater contaminant removal and residual management 35 Driving Growth in Biocides Broadening the Addressable Market JV combines ROH wood biocides and CSI wood protection chemicals and services Serves $1.4 Billion wood protection market, with current annual sales >$2MM Future growth from introduction of new technologies and broader product portfolio Transition industry from metallic to organic wood preservatives New preservative technology for wood with a positive environmental profile Incorporates a stabilizer system proven in field use to improve weathering performance of treated wood Recently received EPA approval 36

19 Potential Breakout Business: Leveraging Patented 1-MCP Technology Developing on Our Own Maintains and extends the freshness, flavor and appearance of fresh fruits and vegetables Commercializing in Partnership Helps manage fruit maturation, aiding crop quality and scheduling of harvest labor Keeps flowers, potted and bedding plants fresh throughout shipping and distribution Products / services for the specialty crop & floral industries $12 - $16 million revenue potential at maturity Very high gross profit margins Reinvesting virtually all profits in growth of the overall business Protects crop yields during periods of heat and drought stress Expanding 1-MCP to pre-harvest use in agronomic crops Global strategic alliance with Syngenta combines resources and capabilities to further develop, register and commercialize Invinsa technology Blockbuster potential based on initial testing and market assessments Expect to commercialize within 2 years 37 Driving to 21: Niche Businesses Sales Growth , in millions of dollars 1, (1) 26 Sales Organic* Acquisitions 21 Sales (1) Organic* including pricing and currency in developed world and RDEs 38

20 Niche Businesses: Why Will We Succeed? Existing leading technology platforms and market presence in targeted segments Deep expertise in materials science Willingness to take risks and be more creative with business models Play in different steps in the value chain Critical mass all new platform efforts in one group 39 Thank you. 4