January 2014 J.S. Whang Executive Chairman Fokko Pentinga President & CEO Brad Anderson Executive VP & CFO 2
Forward-looking statements Certain statements in the following presentation relate to future results that are forward looking statements. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to, changes in the technologies used by Amtech s customers, change and volatility in the demand for its equipment, the effect of changing worldwide political and economic conditions on government-funded solar initiatives, capital expenditures, production levels, including those in Europe and Asia, the effect of overall market conditions, market acceptance, risks associated with dependence on suppliers, the impact of competitive products and pricing, technological and product development risks (including the risks inherent in launching new products) and other risk factors noted in our forms 10-K, 10-Q, and other filings with the SEC. This presentation includes historical and forward-looking pro forma information. The Company assumes no responsibility to update the information contained in this presentation. This presentation and the information contained herein is the property of Amtech Systems, Inc. 3
Amtech markets SOLAR SEMICONDUCTORS LED 4
Solar value chain Our integrated offering Silicon Ingot / Wafer Solar Cell Module AMTECH GROUP Products Cleaning Texturing Diffusion Doping PSG Etching Removal AR Coating Technology Integrated Offering Partnerships Screen Printing Metallization Edge Isolation Testing Sorting 5
Amtech Products & Applications Process Equipment Furnace Automation & Wafer Handling Systems Wafer Carriers, Templates & Polishing Tools Diffusion, Annealing Furnace Furnace Automation Templates PECVD Furnace Ion Implanter S-300 Carriers Solar Cells & Semiconductor Chips LED & Silicon Wafers 6
Amtech group at glance Global supplier of solar & semiconductor process equipment technology and automation systems Headquartered in Tempe, AZ Global presence in NA, Europe, Asia Leading supplier of solar & semiconductor diffusion furnaces Leading edge platform driven by acquisition of technology and continuous innovation Successful deployment of next generation n-type cell Transformed from equipment supplier to technology provider 7
Business Model Successful acquisitions & technology innovation Acquisition ATMOSCAN (from Intel) 1981 1983 1994 1997 2004 2006 2007 2008 2009 2011 2012 2013 Company Founded Joint Development Agreement with ECN for n-type Diffusion Technology 3-party Collaboration Agreement: focused on innovative n-type technology 600 MW completion of n-type PANDA at Yingli Ion implant system introduction 2 nd N-type Customer + PECVD Innovation Batch PECVD system introduction 8
Reliable industry player & provider of Technology Solutions 25 Total Shipped Production Capacity (cumulative) [GW] based on 45 MW/system installed base of 1800 reactors Production capacity of >21 GW Solar Diffusion Market share >35% 20 15 10 5 0 2005 2006 2007 2008 2009 2010 2011 2012 Market share Tempress 38% 62% Rest Sources: Internal data center Market share by SolarBuzz Research 9
Solar PV About To Enter Third Growth Phase : Deutsche Bank Three-quarters of the world s market will be available for sustainable solar within 18 months. The market for solar will have flipped from one largely unsustainable needing big subsidies to one mostly sustainable. 0,08/kWh non-subsidy multi-megawatt project has started in south of Rome. (Subsidy) (No Subsidy) Competitive bidding in California on 20-30MW projects is in the $0.07/kWh range. Source: Deutsche Bank, Vishal Shah, 8/2013 / Stifel, Jeff Osborne, 7/15/2013 10
Supply & Demand: Equilibrium in Sight (2015) The solar industry is on the rebound. Worldwide PV installations are set to rise by double digits in 2014, solar manufacturing is recovering, module prices are stabilizing and emerging markets are on the rise. The PV industry has reached a tipping point that will propel the sector to an unprecedented demand in 2014. The PV industry is said to be heading into its second gold rush with a base demand of 46GW in 2014, and an expected 56GW of demand in 2015. Will push production utilization rates above 90% for tier-1 manufacturers. Emerging markets are expected to make a considerable contribution, ranging from 12GW to 17GW of demand. Expect PV demand in 2013 to have hit 36GW, with the fourth quarter exceeding the 12GW for the first time ever. Sources: NPD Solarbuzz, Deutsche Bank, IHS 11
China market Attractive incentives expected to push around 12GW to be installed in 2014. IHS warns: China 12 GW might be too optimistic, because IHS does not believe the government targets of 8GW of distributed PV being installed is feasible. Counter signs to IHS its warning : China is half way through a US$100 billion ultra-high voltage (UHV) JREF) banked by Japanese giant Softbank, proposed connecting renewable power from Mongolia to Japan Tier 1 PV manufacturers embrace the downstream project business model, Chinese government announced 50% tax rebates for Chinese PV manufacturers, PV policies and trade war standpoint prove a strong focus on renewables, also because of the recent pollution apocalypses. China's on-grid solar power capacity will amount to 10 GW by the end of 2013 Harbin, China on 21 October 2013: It s getting colder, which means firing up the coal plants, turning the atmosphere into a toxic sauna. 12
Capacity & Consolidations Top 20 capacity installed by Tempress Yingli Tempress is well positioned at the tier 1 manufacturers Recent EU trade settlement with China provides clarity and improves position of Tier 1 Chinese manufacturers. Tianwei 5% Topcell 6% Talesun 3% CSI 3% CPIC 4% Inventec Juli 2% 3% Shangrao 4% BYD 6% Hanwha 7% ETON 7% Yingli 22% Trina 10% Jinko 10% Jinko Trina ETON Hanwha BYD CPIC CSI Talesun Topcell Tianwei Shangrao Juli Inventec Solartech Samsung Rongma Mosel CNPV TIER 1 TIER 2 13
Cost Reduction is NOT the Only Way! Operating cost reduction is mostly exhausted Low efficiency panels are more difficult to sell Chinese projects DEMAND > 15% module efficiency for crystalline panels. The Japan government will reportedly hike energy efficiency standards for imported PV modules in 2013 - mono cells from 18.2% currently to 18.8%, - multi cells from 16.8-17.1% to 17.4% Large field installers sell kwh Future expansion calls for higher efficiency product 14
Price of modules Focus on cost and efficiency 1 0.9 0.8 Module price Q3 '12 Module price 2015 Module price for same $ct/kwh system cost Demand driven price increase? Quality Limited area kwh optimization Price Euro / Wp 0.7 0.6 Supply-demand imbalance? Quality perception 0.5 0.4 Focus on cost and efficiency 0.3 12 13 14 15 16 17 18 19 20 21 Module efficiency 215 230 250 265 280 300W 15
Goals and Strategies Capitalize on next growth opportunities in the solar industry by: Technology Innovation - Execute n-pasha high efficiency roadmap and continue collaboration with top-tier customers and research institutes New Products Develop next technology product and integrated solutions to expand our market Acquisitions Longer term, pursue strategic acquisitions that complement our strong platform for both solar and non-solar growth 16
Next Generation Solar and Growth Technologies Supporting Solar Growth to Date: P-Type (~90% of market) cell with up to 18.5% efficiency N-Type (~10% of market) cell with 19% to 22% efficiency itrpv.net Technologies to Fuel Next Solar Growth: P-Type (~90% of market) cell with up to 20% efficiency N-Type (~10% of market) cost effective cell with 20% to 22% efficiency P-Type can dominate for the next 5 years, or so N-Type Mono to catch up and surpass P-type Mono in the future 17
Next Generation Solar and Growth n-pasha Technology Over 20% n-type Tempress PECVD Anti reflective coating passivation Tempress Diffusion POCl3 BBr3 Annealing Oxidation Implantation Technology Up to 20% p-type Kingstone IonSolar p-type / n-type IBC 18
Semiconductor & LED Analog / Power Chip Sector Serve top players in Analog and Power Chip Sectors, including #1 Infineon, Texas Instruments, Analog Devices (ADI) Potential migration from 6 (2/3 rd ) to 8 (1/3 rd ) to 12 wafers Longer term opportunity LED & Optics LED consumable growth LED and Optics equipment opportunities 19
Take Away! Catalyst for recovery (CAPEX) Global solar expansion Tier 1 getting even bigger Tier 1 technology buying Surviving old production lines (2003-2008) could well require line upgrades to meet efficiency criteria Semiconductor (Analog & Power Chip) migration to larger wafer diameter We stay current with customers We have technology and products for upcoming expansion We double our Total Available Market 20
Management Overview Member Position Experience J.S. Whang Executive Chairman 37 years of semiconductor & solar experience Siltronics U.S. Quartz Fokko Pentinga President & CEO 30 years of semiconductor and solar experience Tempress Systems Brad Anderson Chief Financial Officer 28 years of financial and public company experience Deloitte Zila Dr. James Hwang Vice President, Technology 22 years of semiconductor and solar experience Westinghouse Texas Instruments 21
Financial Overview 22
Annual Order Trend (solar/semi) 200 Solar Semi $188M $240M 150 100 50 0 $107M 73 $35M 34 22 13 26 200 162 $44M $44M 13 22 40 31 22 2008 2009 2010 2011 2012 2013 Fiscal Year (Oct. 1 Sept. 30) 23
Balance Sheet Financial Strength 9/30/2013 Cash unrestricted $37.2 Working Capital $42.9 Total Assets $110.9 Total Debt $0.0 Total Liabilities $44.1 Stockholders Equity $66.8 24
Maintaining Financial Strength Diligent cash deployment Continuous investment in new technologies/product development Aggressive cost management Further streamlined costs Focused management of working capital Receivables: Strong customer relationships; diligent processes Payables: Work-outs with suppliers; re-negotiated contracts Inventory: Reduced purchase commitments 25
Investment Highlights Proven market leader; higher efficiency next generation technology solutions Collaborative relationships with strong core customers Financial strength supports selective investment in R&D Longer term goal to expand solar and non-solar technology portfolio through highly relevant acquisitions Forward-thinking management with well-defined plan Strong execution track record 26
THANK YOU FOR YOUR ATTENTION. 27