Lasertec : Presentation Material - Fiscal Year Ended June 2020 Financial Results（PDF：1,000KB）

Fiscal Year ended June 2020

Financial Results

August 5, 2020

Osamu Okabayashi

President, Lasertec Corporation

(Tokyo Stock Exchange 6920)

Contents

1. Results of Fiscal Year ended June 2020
2. Mid-TermBusiness Plan
3. Forecast of Fiscal Year ending June 2021

1

1. Results of Fiscal Year ended June 2020
2. Mid-TermBusiness Plan
3. Forecast of Fiscal Year ending June 2021

2

Fiscal Year ended June 2020 (FY2020)

We achieved record sales, profits, and

orders

		(Consolidated, in millions of yen)
	FY2020
	YoY change
	Result	Last forecast
			(Feb. 4, 2020)
Net Sales	42,572	+48.0%	40,000
Operating	15,062	+89.7%	14,000
Income
Net Income	10,823	+82.4%	10,000
Orders	80,175	+80.4%	85,000 *
			* As of April 28, 2020

3

Sales and Profits in Last 5 Years

We achieved record sales and profits for the fourth consecutive year while maintaining high profit margins.

(Consolidated, in millions of yen)				42,572
40,000
30,000			28,769
		21,252
20,000	17,278				50%
15,291
			35.4%	40%
29.0%	28.4%	26.8%	27.6%	15,062
			30%
10,000
					20%
			7,941	10,823
		5,685		10%
4,428	4,901	5,933
4,366
3,227	3,534
0					0%
FY2016	FY2017	FY2018	FY2019	FY2020

Sales		Operating income		Net income		Operating income margin

4

FY2020 Earnings Results

Sales exceeded 40 billion yen. We achieved nearly 90% increase YoY in operating income.

Consolidated	FY2019		FY2020
(in millions of yen)	Actual	Margin	Last forecast	Actual		Margin	YoY
		(Feb. 4, 2020)				Change
Net sales	28,769	100.0%	40,000	42,572		100.0%	48.0%
Cost of sales	12,853	44.7%	－	19,581		46.0%	52.3%
Gross profit	15,916	55.3%	－	22,991		54.0%	44.5%
SG&A expenses	7,975	27.7%	－	7,929		18.6%	▲0.6%
Operating income	7,941	27.6%	14,000	15,062		35.4%	89.7%
Ordinary income	7,834	27.2%	14,000	15,115		35.5%	92.9%
Net income	5,933	20.6%	10,000	10,823		25.4%	82.4%

(In millions of yen)			42,572
40,000
28,769
30,000
					Net sales
20,000			15,062
				Operating
10,000		7,941				income
0
	FY2019	FY2020

5

FY2020 Operating Income - Comparison with FY2019

We achieved 7,121 million-yen increase YoY in operating income while proactively making R&D investment.

(Consolidated, in millions of yen)

Increase in gross	Decrease in R&D	FY2020
profit mainly due	Operating
expenses
to sales increase	income
+ 292
＋7,075		15,062
			Increase in
			other SG&A
FY2019			expenses
		▲246
Operating
income
7,941

YoY increase 7,121

0

FY2019

FY2020

6

FY2020 Financial Position

Work in process and advances received increased due to increased orders

(In millions of yen )		Non-current assets
Assets				Current assets

	80,000
	60,000
	40,000		70,002
		39,841
	20,000
	0	10,214	11,791
	June 30, 2019	June 30, 2020
Liabilities and	(In millions of yen)	Net assets
Net Assets		Non-current liabilities
80,000	Current liabilities
	60,000		42,058
	40,000	18,433	559
	514
	20,000	31,107	39,175
	0
	FY2019	FY2020
			7

• Major changes】

		(In millions of yen)
(Current assets)
Work in process	14,603
Cash and deposits	11,537
Other	1,973

		(In millions of yen)
(Current liabilities)
Advances received	13,420
Other	4,091
Income taxes payable	3,147

FY2020 Consolidated Cash Flows

Operating Cash Flow was a surplus of 16,486 million yen

			Operating CF			Investing CF			Financing CF			Cash and cash equivalents, end of year
(In millions of yen)
25,000															24,660
20,000
				16,486
15,000
10,000
5,000
0
(5,000)										▲ 2,038	▲ 2,800

FY2020

• Major factors】

Operating CF： Income before income taxes (15,115), Increase in advances received (13,438), Increase in other, net (5,033) Increase in inventories (▲15,294), Income taxes paid (▲2,556), Increase in accounts receivable-trade (▲1,333)

Investing CF： Purchase of property, plant and equipment (▲1,178), Purchase of intangible assets (▲620)

Financing CF： Cash dividends paid (▲2,795)

8

FY2020 Sales by Product Category

Sales of semiconductor-related products achieved a significant increase and surpassed 34 billion yen, driven by the strong sales of EUV-related systems.

Consolidated	FY2019		FY2020
		Last forecast				YoY
(in millions of yen)	Actual	Ratio	Actual		Ratio
(Feb. 4, 2020)		Change
Semiconductor-related products	19,762	68.7%	30,700	34,372		80.7%	73.9%
Other products	4,409	15.3%	3,000	2,150		5.1%	▲51.2%
Services	4,597	16.0%	6,300	6,049		14.2%	31.6%
Total	28,769	100.0%	40,000	42,572		100.0%	48.0%

(In millions of yen)			42,572
40,000						Services
28,769
30,000
					Other products
20,000						Semiconductor-
						related products
10,000
0
		FY2019	FY2020

9

FY2020 Orders and Backlog by Product Category

Orders and backlog increased in all categories and surpassed the past record. The main driver is EUV-related systems.

Orders

Consolidated	FY2019		FY2020
(in millions of yen)	Actual	Last forecast	Actual	YoY
	(April 28, 2020)	change
Semicondutor-related products	37,338	76,000	70,157	87.9%
Other products	2,329	3,500	3,490	49.8%
Services	4,781	5,500	6,527	36.5%
Total	44,449	85,000	80,175	80.4%

(In millions of yen) 100,000
	80,175			Services
80,000
						Other products
60,000
44,449
40,000							Semiconductor-
						related products
20,000
0

FY2019

FY2020

Backlog

FY2019	FY2020
Actual	Actual	YoY
change
52,041	87,826	68.8%
2,597	3,937	51.6%
921	1,398	51.9%
55,560	93,163	67.7%

10

FY2020 Other Indicators

We made R&D investment and hired more employees proactively.

Consolidated		FY2019		FY2020
(in millions of yen)		Actual	Actual	Percentage	YoY
					of sales	Change
R&D expenses		3,590	3,297	7.7%	▲8.2%
Depreciation and amortization		499	881	2.1%	76.4%
Capital expenditure *1		2,097	1,103	2.6%	▲47.4%
*1 Including intangible assets
Total number of employees *2			375	448	－	73
*2 Not including the members of the board

11

FY2020 New Products

	ACTIS A150 Actinic EUV Patterned Mask Inspection System was
	released
	This is the world's first EUV patterned mask inspection system
Sept	using EUV light, whose wavelength is much shorter than
2019	DUV light, for inspection light. It achieves a
	higher level of defect sensitivity and enables the
	detection of printable phase defects. It is also capable of
	performing through-pellicle EUV mask inspection.

	OPTELICS® HYBRID+ Hybrid Laser Microscope was released
	This microscope achieves both multi-functions and high performance with two
Jan	sets of optics - laser confocal and white light confocal - integrated on a single
platform. It adopted hardware improvements such as LED light source for longer
2020
lifetime as well as new software programs for such functions
	as measurement assist and AI inspection.

12

FY2020 Topics (Awards and Recognition)

Sept	ACTIS presentation won BEST ORAL PRESENTATION
at SPIE Photomask Technology + EUV Lithography
2019
2019
Jan	ACTIS A150 Actinic EUV Patterned Mask Inspection System won 10
Best New Products Award "Japan Brand Prize" from Nikkan Kogyo
2020
Shimbun (Business & Technology Daily News)
Mar	Lasertec won Supplier Achievement Award (SAA)
from Intel, being recognized as a supplier who made
2020
an outstanding achievement
June	ACTIS A150 Actinic EUV Patterned Mask Inspection System won the
grand prize of Semiconductor of the Year 2020 from Electronic Device
2020
Industry News
June	Lasertec was selected among 100 Global Niche Top Enterprises by the
2020	Ministry of Economy, Trade and Industry

13

FY2020 Topics (Investor Relations)

Aug	Lasertec stock was selected as a constituent of JPX-NikkeiIndex 400,
which consists of 400 stocks highly attractive to investors and
2019
meeting its global investment standard

Apr	Lasertec was ranked third overall in the electronics/precision
instruments sector in 2020 All Japan Executive Team Rankings
2020
released by Institutional Investor

	Lasertec stock was selected as a constituent of MSCI* Global
May	Standard Index, a globally-renowned stock index used as a
benchmark by pension and investment fund managers engaged in
2020
global investments.
	* MSCI: Morgan Stanley Capital International

14

1. Results of Fiscal Year ended June 2020
2. Mid-TermBusiness Plan
3. Forecast of Fiscal Year ending June 2021

15

Mid-Term Business Plan

Basic Policy

"Focus our resources on business areas where we excel and expect high growth"

Phase 0	July 2009	Get Ready for New Chapter
through	・ Focus on select business areas where we excel and
	expect growth
	June 2012
	・ Reinforce financial strength

Phase 1	July 2012	Take on New Challenges
	through	・ Reinforce core business
	June 2015
	・ Create a pillar of new business
Phase 2	July 2015	Establish Solid Foundation of New Business
	through	Core Business・ Enhance competitive edge
	June 2018	・ Increase market share
		New Business・ Establish a foundation for EUV/wafer
		inspection business growth
		・ Find new business areas by
		microscope marketing

16

Mid-Term Business Plan - Phase 3

We are in Phase 3, the fourth stage of Mid-Term Business Plan. We will achieve large sales increase in this stage.

Phase 3	July 2018
	through
	June 2021
	1st year: FY2019
	2nd year： FY2020
This year	3rd year: FY2021

On Growth Trajectory with New Business

Core Business・ Further enhance competitive edge

• Get overwhelming market share

New Business・ Achieve large sales growth

• Find new needs and new applications

Service

・ Global service enhancement

17

Strategy and Target Market

Focus on market segments where our strengths can be used effectively, where our solutions are differentiated from others, and where the customers appreciate the value we offer.

Target a market where:

• The customer has an advanced technical requirement in the area of inspection and measurement, and Lasertec has a chance to offer differentiated solutions.

• The customer appreciates the value of inspection and measurement.
  ③ There is potential for future investment.

＊Offer optimum solutions in a market segment that large companies find not large enough to justify entry (if the market is large, target a segment where we have a competitive advantage).

＊Capture a large market share in the segment.

＊Enter neighboring segments to expand the area of business.

＊Have multiple market segments like this to pursue multi niche champion strategy.

18

Growth in Phase 3

We keep aiming to achieve high-quality(high-value, high-

profit-margin) growth.

Sales growth concept

New business

New business

(wafer inspection)

New area

New business (EUV-related)

New business

(wafer inspection)

(wafer inspection）

ExistingExisting

businessbusiness

Existing business

Phase 0	Phase 1	Phase 2	Phase 3
July 2009 to June 2012	July 2012 to June 2015	July 2015 to June 2018	July 2018 to June 2021

(Note) Sales growth concept only. Not drawn to scale.

19

Mid-Term Business Plan: Sales and Operating Income Results

(Sales)											(Operating income)
											42,572
40,000		Sales (left-hand scale)							20,000
		Operating profit (right-hand scale)
										28,769
30,000											15,000
											15,062
									21,252
20,000								17,278			10,000
					13,607	15,187	15,291
		12,722	12,337
		11,397
									7,941
9,266	8,931
									5,000
10,000									5,685
								4,901
						4,722	4,428
		2,441	3,088		3,097
			2,149
0										0
746
▲ 657											(2,500)
FY2009	FY2010	FY2011	FY2012	FY2013	FY2014	FY2015	FY2016	FY2017	FY2018	FY2019	FY2020
	Phase 0	Phase 1	Phase 2	Phase 3

(Consolidated, in millions of yen)

20

1. Results of Fiscal Year ended June 2020
2. Mid-TermBusiness Plan
3. Forecast of Fiscal Year ending June 2021

21

Market Trend

Mobile・5G/		Data Center		AI	Automotive
IoT
Pursuit of		Massive data		Innovation centered		Widespread use of
			electric vehicles and
convenience		storage		on Deep Learning
			self-driving
5G penetration rate:
	33 ZB (2018)				EV&PHV market
48% (2025)			Jobs replace by AI:		penetration rate:
5G investment ratio:		↓		49%		20 to 30% (2030) ＊4
80% (2020 to 2025)		175 ZB (2025)		(circa 2025 to 2035)		Self-driving installation
＊１		＊2		＊3		rate: 17% or higher(2030) ＊5
Logic		CPU, GPU				CPU, GPU, FPGA
3D-NAND, DRAM			CPU, GPU, FPGA		Image Sensor
	3D-NAND, DRAM
Image Sensor					SiC

Source: ＊１ GSMA 2020 (5G penetration rate of North America, and total global 5G capital investments by mobile carriers),＊2 IDC 2018、＊3 Nomura Research Institute 2015,＊4 Future Investment Strategy 2018 (Data of Japan), ＊5 Frost & Sullivan 2019 (Installation of self-driving system level 3 or higher on new vehicles)

22

Business Environment

Semiconductor

Others

Segment	Business environment
Logic	Investment in leading-edge technology nodes, mainly EUV-related, is
expected to continue to meet demand for 5G and HPC.
Memory	Investment in leading-edge production facilities for 3D-NAND and DRAM
is expected to resume.
	The market is expected to grow in the medium to long term, driven by
Image sensor	the adoption of multiple lenses on smartphones and the growth of
	automotive applications.
Power device	The market is expected to grow as manufacturers accelerate efforts to
introduce SiC devices to electric vehicles.
Segment	Business environment
FPD	Large LCD panel investment is forecast to decrease. OLED investment
is resuming to meet demand for mobile applications.
LiB	The consumer product market is growing slowly, driven mainly by
mobile-related applications. The market growth driven by the
	electrification of vehicles is anticipated.

23

Global Semiconductor Equipment Market (SEMI July 2020)

The market grows 6% YoY to US$63.2 billion in 2020 and 10% YoY to

US$70 billion, the highest level ever, in 2021, driven by resumed memory investment and investment in leading-edge processes.

In billions of US dollars

80
		$70.0
	$64.4	$63.2
60		$56.6	$59.6

$41.2

40

20

0

Others

Europe

Japan

N. America

Korea

Taiwan

China

2016

2017

2018

2019

2020 forecast 2021 forecast

Source: SEMI July 2020

24

FY2021 Goals and Actions (1)

EUV-related systems

Keep improving product performance and enhance competitive advantage to solidify our market position

Wafer inspection systems

Achieve large sales increase mainly by promoting SiC wafer inspection systems

Global service

Establish a solid global maintenance infrastructure that enables local engineers at overseas subsidiaries to perform system installation and maintenance without relying on HQ engineers

25

FY2021 Goals and Actions (2)

Mask blank manufacturing	Mask manufacturing	Mask defect inspection at wafer fabs
(Device manufacturing)

New

MAGICS M9650

Mask Blanks

Inspection and

Review System

DUV

ABICS E120	ACTIS A150	MATRICS	BASIC Series
EUV Mask Blanks	Actinic EUV	X8ULTRA	EUV Mask Backside
Inspection and	Patterned Mask	Mask Inspection	Inspection and
Review System	Inspection System	System	Cleaning System
EUV light	EUV light
(13.5nm)	(13.5nm)
Multilayer	Pellicle

EUV substrate

EUV mask blank	• Patterned EUV mask with pellicle
• Patterned EUV mask without pellicle
	Inspection is possible with or
	without pellicle
	＊Picture above shows EUV mask with
	pellicle

Patterned EUV mask without pellicle

26

Forecast of Fiscal Year ending June 2021 (FY2021)

Aiming to achieve new record sales and profits

Consolidated				FY2020		FY2021
					Forecast					YoY
(in millions of yen)		Actual	Margin			Margin
	(Aug. 5, 2020)			Change
Net sales		42,572	100.0%	57,000	100.0%		33.9%
Operating income		15,062	35.4%	17,000	29.8%		12.9%
Ordinary income		15,115	35.5%	17,000	29.8%		12.5%
Net income		10,823	25.4%	12,500	21.9%		15.5%
(In millions of yen)	60,000			57,000
	42,572
	40,000							Net sales
	20,000			15,062	17,000			Operating
						income

0

FY2020 FY2021

Actual Forecast

27

FY2021 Forecast - Operating Income Comparison with FY2020

Aiming to achieve 1,937 million-yen increase YoY while proactively making R&D investment

Increase in gross profit mainly

due to sales increase(Consolidated, in millions of yen) ＋6,067

							FY2021
							Operating income
FY2020					17,000
Increase in
Operating income
	R&D	Increase in
15,062
	expenses	other SG&A
				▲3,414	expenses
						▲715

YoY increase 1,937

FY2020	FY2021
Actual	Forecast

28

FY2021 Forecast - Sales by Product Category

Sales growth to be driven by EUV-related systems

Consolidated	FY2020	FY2021
		Forecast		YoY
(in millions of yen)	Actual	Ratio	Ratio
(Aug. 5, 2020)	Change
Semiconductor-related products	34,372	80.7%	46,000	80.7%	33.8%
Other products	2,150	5.1%	3,500	6.1%	62.7%
Services	6,049	14.2%	7,500	13.2%	24.0%
Total	42,572	100.0%	57,000	100.0%	33.9%

(In millions of yen) 60,000			57,000
					Services
	42,572
40,000					Other products
					Semiconductor-
					related products
20,000

0

FY2020 Actual

FY2021 Forecast

29

FY2021 Forecast - Orders and Backlog by Product Category

Aiming to achieve orders and backlog at a high level mainly from EUV-related systems

	Orders							Backlog
	Consolidated		FY2020	FY2021	FY2020	FY2021
	(in millions of yen)		Actual	Forecast			YoY	Actual	Forecast	YoY
						(Aug 5, 2020)			Change	(Aug 5, 2020)	Change
	Semiconductor-related products		70,157	70,000			▲0.2%			87,826	111,826	27.3%
	Other products		3,490	2,500			▲28.4%	3,937	2,937	▲25.4%
	Services		6,527	7,500	14.9%			1,398	1,398	0.0%
	Total		80,175	80,000			▲0.2%			93,163	116,163	24.7%
(In millions of yen) 100,000				80,000			Services
80,000		80,175
								Other products
60,000
								Semiconductor-
40,000
								related products
20,000

0

FY2020 Actual FY2021 Forecast

30

FY2021 Forecast - Other Indicators

We will continue to make R&D investment and hire more employees proactively for future growth.

Consolidated		FY2020		FY2021
		Forecast	Percentage	YoY
(in millions of yen)		Actual
		of sales	Change
		(Aug 5, 2020)
R&D expenses		3,297	6,712	11.8%	103.6%
Depreciation and amortization		881	1,030	1.8%	16.9%
Capital expenditure *1		1,103	1,093	1.9%	▲0.9%
*1 Including intangible assets
Total number of employees *2		448	549	-	101
*2 Not including the members of the board

31

Dividend Policy

We plan to pay record annual dividends for FY2021

Dividend Policy

・Steady income distribution to shareholders and flexible payment based on performance ・35% dividend payout ratio on a consolidated basis is the guideline (since FY2015)

History of Dividends

		FY2019	FY2020	FY2021 (Forecast)
	Interim		Year-end	Interim	Year-end	Interim	Year-end
						(planned)
Dividend per	16			31	31	27	20	29
				Total is not shown because it
share (yen)		Total 47	Total 49
	cannot be obtained in simple
					calculation due to stock split
Total amount
of dividends			2,119		3,832		4,418
(million yen)
Dividend	35.7%	35.4%	35.4%
payout ratio

Note) Effective January 1, 2020, the company split its common stock 2 for 1. The figures of year-end dividend for FT2020 and interim and year-end dividends for FY2021 (forecast) are calculated based on the number of issued shares after the stock split. The figure of year-end dividend per share for FY2020 would be 54 yen if it were calculated using the number of issued shares before the stock split.

32

Contact Information

・Lasertec Corporation

Yutaro Misawa, General Manager, Corporate Planning Office ・Phone: [phone]

・E-mail: yutaro.misawa＠ lasertec.co.jp

Rounding of figures in this presentation:

Figures less than a million yen are rounded down where the financial results and forecasts are presented. The sum of component figures may not be equal to the total figure due to round-off error.

This presentation is compiled from information available to us as of the date of release. Actual results may differ materially from the forecast of this presentation due to various factors.

33